Exhibit 10.9


 


EXECUTION COPY


 




 





SECOND LIEN CREDIT AGREEMENT


 


dated as of


 


June 15, 2007


 


among


 


STR ACQUISITION, INC.,

(to be merged with and into SPECIALIZED TECHNOLOGY RESOURCES, INC.)


 


STR HOLDINGS LLC,


 


THE LENDERS PARTY HERETO,


 


CREDIT SUISSE,

as Administrative Agent and Collateral Agent


 






 


CREDIT SUISSE SECURITIES (USA) LLC


 


as Sole Bookrunner and Sole Lead Arranger




 





[CS&M
Ref. No. 5865-531]


 

















 


Table of Contents


 


	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  
	
  ARTICLE I

  
	
   

  	
   

  	
   

  
	
  Definitions

  
	
  SECTION 1.01.

  	
  Defined Terms

  	
  1

  
	
  SECTION 1.02.

  	
  Terms Generally

  	
  22

  
	
  SECTION 1.03.

  	
  Pro Forma Calculations

  	
  23

  
	
  SECTION 1.04.

  	
  Classification of Loans and Borrowings

  	
  23

  
	
   

  	
   

  	
   

  
	
  ARTICLE II

  
	
   

  	
   

  	
   

  
	
  The Credits

  
	
   

  
	
  SECTION 2.01.

  	
  Commitments

  	
  23

  
	
  SECTION 2.02.

  	
  Loans

  	
  23

  
	
  SECTION 2.03.

  	
  Borrowing Procedure

  	
  24

  
	
  SECTION 2.04.

  	
  Evidence of Debt; Repayment of Loans

  	
  25

  
	
  SECTION 2.05.

  	
  Fees

  	
  26

  
	
  SECTION 2.06.

  	
  Interest on Loans

  	
  26

  
	
  SECTION 2.07.

  	
  Default Interest

  	
  27

  
	
  SECTION 2.08.

  	
  Alternate Rate of Interest

  	
  27

  
	
  SECTION 2.09.

  	
  Termination and Reduction of Commitments

  	
  27

  
	
  SECTION 2.10.

  	
  Conversion and Continuation of Borrowings

  	
  27

  
	
  SECTION 2.11.

  	
  Optional Prepayment

  	
  29

  
	
  SECTION 2.12.

  	
  Mandatory Prepayments

  	
  30

  
	
  SECTION 2.13.

  	
  Reserve Requirements; Change in Circumstances

  	
  31

  
	
  SECTION 2.14.

  	
  Change in Legality

  	
  32

  
	
  SECTION 2.15.

  	
  Indemnity

  	
  33

  
	
  SECTION 2.16.

  	
  Pro Rata Treatment

  	
  33

  
	
  SECTION 2.17.

  	
  Sharing of Setoffs

  	
  34

  
	
  SECTION 2.18.

  	
  Payments

  	
  34

  
	
  SECTION 2.19.

  	
  Taxes

  	
  35

  
	
  SECTION 2.20.

  	
  Assignment of Commitments Under Certain
  Circumstances; Duty to Mitigate

  	
  37

  
	
   

  	
   

  	
   

  
	
  ARTICLE III

  
	
   

  	
   

  	
   

  
	
  Representations and
  Warranties

  
	
   

  	
   

  
	
  SECTION 3.01.

  	
  Organization; Powers

  	
  38

  
	
  SECTION 3.02.

  	
  Authorization

  	
  39

  
	
  SECTION 3.03.

  	
  Enforceability

  	
  39

  



 

















 


	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  
	
  SECTION 3.04.

  	
  Governmental Approvals

  	
  39

  
	
  SECTION 3.05.

  	
  Financial Statements

  	
  39

  
	
  SECTION 3.06.

  	
  No Material Adverse Change

  	
  40

  
	
  SECTION 3.07.

  	
  Title to Properties; Possession Under Leases

  	
  40

  
	
  SECTION 3.08.

  	
  Subsidiaries

  	
  41

  
	
  SECTION 3.09.

  	
  Litigation; Compliance with Laws

  	
  41

  
	
  SECTION 3.10.

  	
  Agreements

  	
  41

  
	
  SECTION 3.11.

  	
  Federal Reserve Regulations

  	
  41

  
	
  SECTION 3.12.

  	
  Investment Company Act

  	
  42

  
	
  SECTION 3.13.

  	
  Use of Proceeds

  	
  42

  
	
  SECTION 3.14.

  	
  Tax Returns

  	
  42

  
	
  SECTION 3.15.

  	
  No Material Misstatements

  	
  42

  
	
  SECTION 3.16.

  	
  Employee Benefit Plans

  	
  42

  
	
  SECTION 3.17.

  	
  Environmental Matters

  	
  43

  
	
  SECTION 3.18.

  	
  Insurance

  	
  43

  
	
  SECTION 3.19.

  	
  Security Documents

  	
  44

  
	
  SECTION 3.20.

  	
  Location of Real Property and Leased Premises

  	
  45

  
	
  SECTION 3.21.

  	
  Labor Matters

  	
  45

  
	
  SECTION 3.22.

  	
  Solvency

  	
  45

  
	
  SECTION 3.23.

  	
  Transaction Documents

  	
  45

  
	
  SECTION 3.24.

  	
  Sanctioned Persons

  	
  45

  
	
   

  	
   

  	
   

  
	
  ARTICLE IV

  
	
   

  	
   

  	
   

  
	
  Conditions of Lending

  
	
   

  	
   

  	
   

  
	
  ARTICLE V

  
	
   

  	
   

  	
   

  
	
  Affirmative Covenants

  
	
   

  	
   

  	
   

  
	
  SECTION 5.01.

  	
  Existence; Compliance with Laws; Businesses and
  Properties

  	
  49

  
	
  SECTION 5.02.

  	
  Insurance

  	
  49

  
	
  SECTION 5.03.

  	
  Obligations and Taxes

  	
  51

  
	
  SECTION 5.04.

  	
  Financial Statements, Reports, etc.

  	
  51

  
	
  SECTION 5.05.

  	
  Litigation and Other Notices

  	
  53

  
	
  SECTION 5.06.

  	
  Information Regarding Collateral

  	
  53

  
	
  SECTION 5.07.

  	
  Maintaining Records; Access to Properties and
  Inspections; Maintenance of Ratings

  	
  54

  
	
  SECTION 5.08.

  	
  Use of Proceeds

  	
  55

  
	
  SECTION 5.09.

  	
  Employee Benefits

  	
  55

  
	
  SECTION 5.10.

  	
  Compliance with Environmental Laws

  	
  55

  
	
  SECTION 5.11.

  	
  Further Assurances

  	
  55

  
	
  SECTION 5.12.

  	
  Interest Rate Protection

  	
  56

  



 

















 


	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  
	
  SECTION 5.13.

  	
  Post-Closing Items

  	
  56

  
	
  SECTION 5.14.

  	
  Funds Update

  	
  56

  
	
  SECTION 5.15.

  	
  Purchase Price Adjustments

  	
  56

  
	
   

  	
   

  	
   

  
	
  ARTICLE VI

  
	
   

  	
   

  	
   

  
	
  Negative Covenants

  
	
   

  	
   

  	
   

  
	
  SECTION 6.01.

  	
  Indebtedness

  	
  57

  
	
  SECTION 6.02.

  	
  Liens

  	
  58

  
	
  SECTION 6.03.

  	
  Sale/LeaseBack Transactions

  	
  59

  
	
  SECTION 6.04.

  	
  Investments, Loans and Advances

  	
  60

  
	
  SECTION 6.05.

  	
  Mergers, Consolidations, Sales of Assets and Acquisitions

  	
  62

  
	
  SECTION 6.06.

  	
  Restricted Payments; Restrictive Agreements

  	
  62

  
	
  SECTION 6.07.

  	
  Transactions with Affiliates

  	
  64

  
	
  SECTION 6.08.

  	
  Business of Holdings, Borrower and Subsidiaries

  	
  64

  
	
  SECTION 6.09.

  	
  Other Indebtedness and Agreements

  	
  64

  
	
  SECTION 6.10.

  	
  Capital Expenditures

  	
  65

  
	
  SECTION 6.11.

  	
  Maximum Total Leverage Ratio

  	
  65

  
	
  SECTION 6.12.

  	
  Fiscal Year

  	
  66

  
	
  SECTION 6.13.

  	
  Certain Equity Securities

  	
  66

  
	
   

  	
   

  	
   

  
	
  ARTICLE VII

  
	
   

  
	
  Events of
  Default

  
	
   

  
	
  ARTICLE VIII

  
	
   

  
	
  The
  Administrative Agent and the Collateral Agent

  
	
   

  
	
  ARTICLE IX

  
	
   

  
	
  Miscellaneous

  
	
   

  
	
  SECTION 9.01.

  	
  Notices

  	
  73

  
	
  SECTION 9.02.

  	
  Survival of Agreement

  	
  73

  
	
  SECTION 9.03.

  	
  Binding Effect

  	
  74

  
	
  SECTION 9.04.

  	
  Successors and Assigns

  	
  74

  
	
  SECTION 9.05.

  	
  Expenses; Indemnity

  	
  77

  
	
  SECTION 9.06.

  	
  Right of Setoff

  	
  79

  
	
  SECTION 9.07.

  	
  Applicable Law

  	
  79

  
	
  SECTION 9.08.

  	
  Waivers; Amendment

  	
  79

  



 

















 


	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  
	
  SECTION 9.09.

  	
  Interest Rate Limitation

  	
  80

  
	
  SECTION 9.10.

  	
  Entire Agreement

  	
  81

  
	
  SECTION 9.11.

  	
  WAIVER OF JURY TRIAL

  	
  81

  
	
  SECTION 9.12.

  	
  Severability

  	
  81

  
	
  SECTION 9.13.

  	
  Counterparts

  	
  81

  
	
  SECTION 9.14.

  	
  Headings

  	
  81

  
	
  SECTION 9.15.

  	
  Jurisdiction; Consent to Service of Process

  	
  82

  
	
  SECTION 9.16.

  	
  Confidentiality

  	
  82

  
	
  SECTION 9.17.

  	
  USA PATRIOT Act Notice

  	
  83

  
	
  SECTION 9.18.

  	
  Intercreditor Agreement

  	
  83

  



 

















 


	
   

  	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  	
   

  
	
  SCHEDULES

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Schedule 1.01(a)

  	
  -

  	
  Subsidiary Guarantors

  	
   

  
	
  Schedule 1.01(b)

  	
  -

  	
  Mortgaged Property

  	
   

  
	
  Schedule 2.01

  	
  -

  	
  Lenders and Commitments

  	
   

  
	
  Schedule 3.08

  	
  -

  	
  Subsidiaries

  	
   

  
	
  Schedule 3.09

  	
  -

  	
  Litigation

  	
   

  
	
  Schedule 3.17

  	
  -

  	
  Environmental Matters

  	
   

  
	
  Schedule 3.18

  	
  -

  	
  Insurance

  	
   

  
	
  Schedule 3.19(a)

  	
  -

  	
  UCC Filing Offices

  	
   

  
	
  Schedule 3.19(c)

  	
  -

  	
  Mortgage Filing Offices

  	
   

  
	
  Schedule 3.20(a)

  	
  -

  	
  Owned Real Property

  	
   

  
	
  Schedule 3.20(b)

  	
  -

  	
  Leased Real Property

  	
   

  
	
  Schedule 6.01

  	
  -

  	
  Existing Indebtedness

  	
   

  
	
  Schedule 6.02

  	
  -

  	
  Existing Liens

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  EXHIBITS

  	
   

  	
   

  	
   

  
	
   

  	
   

  
	
  Exhibit A

  	
  -

  	
  Form of Administrative Questionnaire

  	
   

  
	
  Exhibit B

  	
  -

  	
  Form of Assignment and Acceptance

  	
   

  
	
  Exhibit C

  	
  -

  	
  Form of Borrowing Request

  	
   

  
	
  Exhibit D

  	
  -

  	
  Form of Guarantee and Collateral Agreement

  	
   

  
	
  Exhibit E

  	
  -

  	
  Form of Mortgage

  	
   

  
	
  Exhibit F-1

  	
  -

  	
  Form of Opinion of Weil, Gotshal &
  Manges LLP

  	
   

  
	
  Exhibit F-2

  	
  -

  	
  Form of Opinion of Murtha Cullina LLP

  	
   

  
	
  Exhibit G

  	
  -

  	
  Form of Interest Election Request

  	
   

  
						



 

















 


SECOND LIEN CREDIT
AGREEMENT dated as of June 15, 2007, among STR ACQUISITION, INC., a
Delaware corporation, which substantially simultaneously with the execution
hereof shall be merged with and into SPECIALIZED TECHNOLOGY RESOURCES, INC., a
Delaware corporation (the “Borrower”), STR
HOLDINGS LLC, a Delaware limited liability company (“Holdings”),  the Lenders (as
defined in Article I), and CREDIT SUISSE, as administrative agent (in such
capacity, the “Administrative Agent”) and as collateral agent (in such
capacity, the “Collateral Agent”) for the Lenders.


 


The Borrower has
requested the Lenders to make Loans (such term and each other capitalized term
used but not defined in this introductory statement having the meaning given it
in Article I) on the Closing Date, in an aggregate principal amount not in
excess of $75,000,000. The proceeds of the Loans are to be used together with
the proceeds of the First Lien Loans and cash to be contributed by Holdings
solely (a) to pay consideration, fees and expenses related hereto and to
the Acquisition and (b) to refinance the Existing Debt.


 


The Lenders are willing
to extend such credit to the Borrower on the terms and subject to the
conditions set forth herein. Accordingly, the parties hereto agree as follows:


 


ARTICLE I


 


Definitions


 


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


 


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


 


“Acquisition”  shall mean the acquisition by
Holdings of the Company and its subsidiaries pursuant to the Merger Agreement,
pursuant to which on the Closing Date the Borrower will merge with and into the
Company with the Company surviving as a wholly owned direct subsidiary of
Holdings.


 


“Adjusted LIBO
Rate”  shall
mean, with respect to any Eurodollar Borrowing for any Interest Period, an
interest rate per annum equal to the product of (a) the LIBO Rate in
effect for such Interest Period and (b) Statutory Reserves.


 


“Administrative
Agent Fees”  shall
have the meaning assigned to such term in Section 2.05(a).


 

















 


“Administrative
Questionnaire”  shall
mean an Administrative Questionnaire in the form of Exhibit A, or such
other form as may be supplied from time to time by the Administrative Agent.


 


“Advisory
Services and Monitoring Agreements”  shall mean (i) the Advisory Services
and Monitoring Agreement dated as of the Closing Date, between the Borrower and
Evergreen Capital Partners, LLC and (ii) the Monitoring Agreement dated as
of the Closing Date, among the Borrower, DLJ Merchant Banking, Inc.,
Westwind STR Advisors, LLC and Dennis L Jilot.


 


“Affiliate”
shall mean, when used with respect to a specified person, another
person that directly, or indirectly through one or more intermediaries,
Controls or is Controlled by or is under common Control with the person
specified; provided, however, that,
(i) for purposes of Section 6.07, the term “Affiliate” shall also
include any person that directly or indirectly owns 5% or more of any class of
Equity Interests of the person specified or that is an officer or director of
the person specified and (ii) Credit Suisse and its Affiliates (other than
Permitted Investors, Parent and Parent’s subsidiaries) shall be deemed not to
be Affiliates of Parent or any of its subsidiaries.


 


“Alternate Base
Rate”  shall
mean, for any day, a rate per annum equal to the greater of (a) the Prime
Rate in effect on such day and (b) the Federal Funds Effective Rate in
effect on such day plus 1/2 of 1%. If the Administrative Agent shall have
determined (which determination shall be conclusive absent manifest error) that
it is unable to ascertain the Federal Funds Effective Rate for any reason,
including the inability or failure of the Administrative Agent to obtain
sufficient quotations in accordance with the terms of the definition thereof,
the Alternate Base Rate shall be determined without regard to clause (b) of
the preceding sentence until the circumstances giving rise to such inability no
longer exist. Any change in the Alternate Base Rate due to a change in the
Prime Rate or the Federal Funds Effective Rate shall be effective on the
effective date of such change in the Prime Rate or the Federal Funds Effective
Rate, as the case may be.


 


“Applicable Percentage”  shall mean, for any day (a) with
respect to any Eurodollar Loan, 7.00% per annum, and (b) with respect to
any ABR Loan, 6.00% per annum.


 


“Arranger”  shall mean
Credit Suisse Securities (USA) LLC.


 


“Asset Sale”  shall mean
the sale, transfer or other disposition (by way of merger, casualty,
condemnation or otherwise) by the Borrower or any of the Subsidiaries to any
person other than the Borrower or any Subsidiary Guarantor of (a) any
Equity Interests of any of the Subsidiaries (other than directors’ qualifying
shares) or (b) any other assets of the Borrower or any of the Subsidiaries
(other than (i) inventory, damaged, obsolete or worn out assets, scrap and
Permitted Investments, in each case disposed of in the ordinary course of
business, (ii) dispositions between or among Foreign Subsidiaries and (iii) any
sale, transfer or other disposition or series of related sales, transfers or
other dispositions having a value not in excess of $500,000).


 


2

















 


“Assignment and
Acceptance”  shall
mean an assignment and acceptance entered into by a Lender and an assignee, and
accepted by the Administrative Agent, in the form of Exhibit B or such
other form as shall be approved by the Administrative Agent.


 


“Attributable
Debt”  in
respect of a Sale/Leaseback Transaction means, as of the time of determination,
the present value (discounted at the interest rate borne by the Loans,
compounded annually) of the total obligations of the lessee for rental payments
during the remaining term of the lease included in such Sale/Leaseback
Transaction (including any period for which such lease has been extended); provided, however, that if such
Sale/Leaseback Transaction results in a Capital Lease Obligation, the amount of
Indebtedness represented thereby will be determined in accordance with the
definition of “Capital Lease Obligations”.


 


“Baseline EBITDA”  shall mean (i) for
the fiscal year ended December 31, 2007, $42,000,000, (ii) for the
fiscal year ended December 31, 2008, $45,000,000, (iii) for the
fiscal year ended December 31, 2009, $50,000,000, (iv) for the fiscal
year ended December 31, 2010, $55,000,000, (v) for the fiscal year
ended December 31, 2011, $60,000,000, (vi) for the fiscal year ended December 31,
2012, $65,000,000, and (vii) for the fiscal year ended December 31,
2013, $70,000,000.


 


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


 


“Borrowing”  shall mean Loans of the
same Type made, converted or continued on the same date and, in the case of Eurodollar
Loans, as to which a single Interest Period is in effect.


 


“Borrowing
Request”  shall
mean a request by the Borrower in accordance with the terms of Section 2.03
and substantially in the form of Exhibit C or such other form as shall be
approved by the Administrative Agent.


 


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


 


“Capital
Expenditures”  shall
mean, for any period, (a) the additions to property, plant and equipment
and other capital expenditures of the Borrower and its consolidated
Subsidiaries that are (or should be) set forth in a consolidated statement of
cash flows of the Borrower for such period prepared in accordance with GAAP and
(b) Capital Lease Obligations or Synthetic Lease Obligations incurred by
the Borrower and its consolidated Subsidiaries during such period, but
excluding in each case any such expenditure made to restore, replace or rebuild
property to the condition of such property immediately prior to any damage,
loss, destruction or condemnation of such property, to the extent such
expenditure is made with insurance proceeds, condemnation awards or damage
recovery proceeds relating to any such damage, loss, destruction or
condemnation.


 


3

















 


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


 


“Cash Interest”  shall have the meaning
assigned to such term in Section 2.06.


 


A. “Change in Control”  shall be deemed to have occurred if (a) prior
to a Qualified Public Offering, the Permitted Investors shall fail to own,
directly or indirectly, beneficially and of record, shares representing at
least 51% of each of the aggregate ordinary voting power represented by the
issued and outstanding Equity Interests of Holdings, (b) after a Qualified
Public Offering, any “person” or “group” (within the meaning of Rule l3d-5
of the Securities Exchange Act of 1934 as in effect on the date hereof), other
than the Permitted Investors, shall own, directly or indirectly, beneficially
or of record, shares representing more than 35% of the aggregate ordinary
voting power represented by the issued and outstanding capital stock of
Holdings, (c) a majority of the seats (other than vacant seats) on the
board of directors of Holdings shall at any time be occupied by persons who
were neither (i) nominated by the board of directors of Holdings nor (ii) appointed
by directors so nominated, (d) any change in control (or similar event,
however denominated) with respect to Holdings, the Borrower or any Subsidiary
shall occur under and as defined in any indenture or agreement in respect of
Material Indebtedness to which Holdings, the Borrower or any Subsidiary is a
party, or (e) Holdings shall cease to directly own, beneficially and of
record, 100% of the issued and outstanding Equity Interests of the Borrower.


 


“Change in Law”  shall mean (a) the adoption of any
law, rule or regulation after the date of this Agreement, (b) any
change in any law, rule or regulation or in the interpretation or
application thereof by any Governmental Authority after the date of this
Agreement or (c) compliance by any Lender (or, for purposes of Section 2.13,
by any lending office of such Lender or by such Lender’s holding company, if
any) with any request, guideline or directive (whether or not having the force
of law) of any Governmental Authority made or issued after the date of this
Agreement.


 


“Closing Date”  shall mean June 15,
2007.


 


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


 


“Collateral”  shall mean all the “Collateral” as
defined in any Security Document and shall also include the Mortgaged
Properties.


 


“Commitment”  shall mean, with
respect to any Lender, the commitment of such Lender to make Loans hereunder as
set forth on Schedule 2.01, or in the Assignment and Acceptance pursuant to
which such Lender assumed its Commitment, as applicable, as the same may be (a) reduced
from time to time pursuant to Section 2.09 and (b) reduced


 


4














 


or increased from time to time pursuant to assignments by or to such
Lender pursuant to Section 9.04.


 


“Company”  shall mean Specialized Technology Resources, Inc., a Delaware
corporation.


 


“Confidential Information Memorandum”  shall mean the Confidential Information
Memorandum of the Borrower dated May, 2007.


 


“Consolidated EBITDA”  shall
mean, for any period, Consolidated Net Income for such period plus (a) without
duplication and to the extent deducted in determining such Consolidated Net
Income, the sum of (i) consolidated interest expense for such period and
any commitment, agency, letter of credit or similar fees paid during such period
with respect to Indebtedness permitted pursuant to Section 6.01 and other
bank service fees, (ii) consolidated income tax expense for such period, (iii) all
amounts attributable to depreciation and amortization for such period, (iv) any
non-cash charges (other than the write-down of current assets) for such period,
(v) fees and expenses accrued during such period with respect to the
Transactions and to the extent not consummated, any acquisition, disposition,
equity issuance, investment or incurrence of Indebtedness that would have been
permitted under this Agreement, (vi) charges in respect of management,
monitoring, consulting and advising fees payable to the Sponsor pursuant to the
Advisory Services and Monitoring Agreements as in effect as of the Closing Date
in respect of such period, (vii) one-time costs, payments and expenses (including
severance costs) incurred during such period in respect of the termination of employment
of employees, officers and management of the Borrower or any Subsidiary outside
the ordinary course of business, (viii) all cash payments received during
such period on account of non-cash income deducted from Consolidated Net Income
pursuant to clause (b)(ii) below in a previous period, (ix) consulting,
legal, accounting, integration, brokerage and variable commission fees, costs
and expenses incurred in connection with any Permitted Acquisition, (x) consulting
fees incurred in connection with a one-time strategic review of the Borrower in
an aggregate amount not to exceed $1,000,000, (xi) net after-tax extraordinary
losses or charges, including any such losses or charges relating to relocation
costs, one-time compensation charges and the Transactions, (xii) non-recurring
or unusual cash charges for such period in an aggregate amount not to exceed $1,000,000
in any fiscal year, (xiii) non-cash compensation charges, (xiv) foreign currency
transaction and translation losses, and (xv) any net after-tax gains or losses
(less fees, expenses or charges related thereto) attributable to the early
extinguishment of Indebtedness pursuant to the agreement governing such
Indebtedness, and minus (b) without duplication (i) all cash payments
made during such period on account of reserves, restructuring charges and other
non-cash charges added to Consolidated Net Income pursuant to clause (a)(iv) above
in a previous period, (ii) foreign currency transaction and translation
gains, and (iii) to the extent included in determining such Consolidated
Net Income, any unusual and extraordinary gains and all non-cash items of
income for such period, all determined on a consolidated basis in accordance
with GAAP. For purposes of determining the Total Leverage Ratio as of or for
the periods ended on September 30, 2007 and December 31, 2007,
Consolidated EBITDA will be


 


5

















 


deemed to be equal
to (i) for the fiscal quarter ended December 31, 2006, $12,013,000,
and (ii) for the fiscal quarter ended March 31, 2007, $7,273,000.


 


“Consolidated
Interest Expense”  shall
mean, for any period, the cash interest expense (including imputed interest
expense in respect of Capital Lease Obligations and Synthetic Lease
Obligations) of the Borrower and the Subsidiaries for such period, determined
on a consolidated basis in accordance with GAAP. For purposes of the foregoing,
interest expense shall be determined after giving effect to any net payments
made or received by the Borrower or any Subsidiary with respect to interest
rate Hedging Agreements.


 


“Consolidated Net Income”  shall
mean, for any period, the net income or loss of the Borrower and the
Subsidiaries for such period determined on a consolidated basis in accordance
with GAAP (adjusted to reflect any charge, tax or expense incurred or accrued
by Holdings during such period as though such charge, tax or expense had been
incurred by the Borrower, to the extent that the Borrower has made or would be
entitled under the Loan Documents to make any payment to or for the account of
Holdings in respect thereof); provided that
there shall be excluded (a) the income of any Subsidiary to the extent
that the declaration or payment of dividends or similar distributions by the
Subsidiary of that income is not at the time permitted by operation of the
terms of its charter or any agreement, instrument, judgment, decree, statute, rule or
governmental regulation applicable to such Subsidiary, (b) the income or
loss of any person accrued prior to the date it becomes a Subsidiary or is
merged into or consolidated with the Borrower or any Subsidiary or the date
that such person’s assets are acquired by the Borrower or any Subsidiary, (c) the
income of any person in which any other person (other than the Borrower or a
wholly owned Subsidiary or any director holding qualifying shares in accordance
with applicable law) has a joint interest, except to the extent of the amount
of dividends or other distributions actually paid to the Borrower or a wholly
owned Subsidiary by such person during such period, and (d) any gains or
losses attributable to sales of assets (including pursuant to a Sale/Leaseback
Transaction) out of the ordinary course of business.


 


“Control”  shall mean the possession, directly or
indirectly, of the power to direct or cause the direction of the management or
policies of a person, whether through the ownership of voting securities, by
contract or otherwise, and the terms “Controlling”  and “Controlled”  shall have meanings correlative thereto.


 


“Credit Facility”  shall mean the term loan facility
provided for by this Agreement.


 


“Cure Amount”  shall have the meaning assigned to such
term in Article VII.


 


“Cure Right”  shall have the meaning assigned to such term
in Article VII.


 


“Current Assets”  shall mean, at any time, the consolidated
current assets (other than cash and Permitted Investments) of the Borrower and
the Subsidiaries.


 


6

















 


“Current
Liabilities”  shall
mean, at any time, the consolidated current liabilities of the Borrower and the
Subsidiaries at such time, but excluding, without duplication, (a) the
current portion of any long-term Indebtedness and (b) outstanding
Revolving Loans and Swingline Loans under the First Lien Credit Agreement (each
as defined therein).


 


“Default”  shall mean any event or condition that
upon notice, lapse of time or both would constitute an Event of Default.


 


“Discharge of First Lien Obligations”
shall have the meaning assigned to such term in the Intercreditor
Agreement.


 


“Disqualified
Stock”  shall
mean any Equity Interest that, by its terms (or by the terms of any security
into which it is convertible or for which it is exchangeable), or upon the
happening of any event, (a) matures (excluding any maturity as the result
of an optional redemption by the issuer thereof) or is mandatorily redeemable,
pursuant to a sinking fund obligation or otherwise, or is redeemable at the
option of the holder thereof, in whole or in part, or requires the payment of
any cash dividend or any other scheduled payment constituting a return of
capital, in each case at any time on or prior to the 91st day following the
Maturity Date, or (b) is convertible into or exchangeable (unless at the
sole option of the issuer thereof) for (i) debt securities or (ii) any
Equity Interest referred to in clause (a) above, in each case at any time
prior to the 91st day following the Maturity Date.


 


“dollars”  or “$” shall mean lawful money of the
United States of America.


 


“Domestic
Subsidiaries”  shall
mean all Subsidiaries incorporated or organized under the laws of the United
States of America, any State thereof or the District of Columbia.


 


“Eligible
Assignee”  shall
mean any commercial bank, insurance company, investment or mutual fund or other
entity (but not any natural person) that is an “accredited investor” (as
defined in Regulation D under the Securities Act of 1933, as amended) that
extends credit or invests in bank loans as one of its businesses; provided that neither the Borrower nor any
of its Affiliates shall be an Eligible Assignee.


 


“EMU”  shall mean the economic and monetary
union as contemplated in the Treaty on European Union.


 


“Environmental
Laws”  shall mean all applicable Federal, state,
local and foreign laws (including common law), treaties, regulations, rules,
ordinances, codes, decrees, judgments, directives and orders (including consent
orders), in each case, relating to pollution or protection of the environment,
natural resources, human health and safety as related to exposure to Hazardous
Materials, or the generation, use, treatment, storage, transport or handling
of, or the arrangement for such activities with respect to, Hazardous
Materials.


 


“Environmental
Liability”  shall mean all liabilities, obligations,
damages, losses, claims, actions, suits, judgments, orders, fines, penalties,
fees, expenses and costs


 


7

















 


(including administrative
oversight costs, natural resource damages and remediation costs), whether
contingent or otherwise, arising out of or relating to (a) requirements of
any Environmental Law, (b) the generation, use, handling, transportation,
storage, treatment or disposal of any Hazardous Materials, (c) exposure to
any Hazardous Materials, (d) the Release of any Hazardous Materials or (e) any
contract, agreement or other consensual arrangement pursuant to which liability
is assumed or imposed with respect to any of the foregoing.


 


“Equity
Contribution”  shall
mean the contribution by DLJ Merchant Banking Partners IV, L.P., its affiliated
funds, certain existing investors in the Company and certain other investors
reasonably acceptable to the Arranger of not less than 30.0% of the pro forma
consolidated capitalization of Holdings after giving effect to the Transactions
on the Closing Date in cash to Holdings as cash common equity and/or preferred
equity that does not provide for any cash dividends, redemption or other cash
payment at any time prior to 91 days after repayment in full in cash of the
Credit Facility.


 


“Equity
Interests”  shall
mean shares of capital stock, partnership interests, membership interests in a
limited liability company, beneficial interests in a trust or other equity
interests in any person, and any option, warrant or other right entitling the
holder thereof to purchase or otherwise acquire any such equity interest.


 


“ERISA”  shall mean the Employee
Retirement Income Security Act of 1974, as the same may be amended from time to
time.


 


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


 


“ERISA Event”  shall mean (a) any “reportable event”,
as defined in Section 4043 of ERISA or the regulations issued thereunder,
with respect to a Plan (other than an event for which the 30-day notice period
is waived), (b) prior to the effectiveness of the applicable provisions of
the Pension Act, the existence with respect to any Plan of an “accumulated
funding deficiency” (as defined in Section 412 of the Code or Section 302
of ERISA) or, on and after the effectiveness of the applicable provisions of
the Pension Act, any failure by any Plan to satisfy the minimum funding
standard (within the meaning of Section 412 of the Code or Section 302
of ERISA) applicable to such Plan, in each case whether or not waived, (c) the
filing pursuant to, prior to the effectiveness of the applicable provisions of
the Pension Act, Section 412(d) of the Code or Section 303(d) of
ERISA or, on and after the effectiveness of the applicable provisions of the
Pension Act, Section 412(c) of the Code or Section 302(c) of
ERISA, of an application for a waiver of the minimum funding standard with
respect to any Plan, (d) on and after the effectiveness of the applicable
provisions of the Pension Act, a determination that any Plan is, or is expected
to be, in “at-risk” status (as defined in Section 303(i)(4) of ERISA
or Section 430(i)(4) of the Code), (e) the incurrence by the
Borrower or any of its ERISA Affiliates of any liability under Title IV of
ERISA with respect to the termination of any Plan or the withdrawal or partial
withdrawal of the


 


8

















 


Borrower or any of its
ERISA Affiliates from any Plan or Multiemployer Plan, (f) the receipt by
the Borrower or any of its ERISA Affiliates from the PBGC or a plan
administrator of any notice relating to the intention to terminate any Plan or
Plans or to appoint a trustee to administer any Plan, (g) prior to the
effectiveness of the applicable provisions of the Pension Act, the adoption of
any amendment to a Plan that would require the provision of security pursuant
to Section 401(a)(29) of the Code or Section 307 of ERISA, (h) the
receipt by the Borrower or any of its ERISA Affiliates of any notice, or the
receipt by any Multiemployer Plan from the Borrower or any of its ERISA
Affiliates of any notice, concerning the imposition of Withdrawal Liability or
a determination that a Multiemployer Plan is, or is expected to be, insolvent
or in reorganization, within the meaning of Title IV of ERISA or, on and after
the effectiveness of the applicable provisions of the Pension Act, in
endangered or critical status, within the meaning of Section 305 of ERISA,
(i) any Foreign Benefit Event or (j) any other event (other than the
initial adoption or assumption of a Plan) or condition with respect to a Plan
or Multiemployer Plan that could result in liability of the Borrower or any
Subsidiary.


 


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


 


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


 


“Excess Cash
Flow”  shall
mean, for any fiscal year of the Borrower (or, in the case of the fiscal year
ended December 31, 2007 (except for purposes of determining changes in
noncash working capital), the portion thereof commencing on the Closing Date
and ending on December 31, 2007), the excess of (a) the sum, without
duplication, of (i) Consolidated EBITDA for such fiscal year and (ii) reductions
to noncash working capital of the Borrower and the Subsidiaries for such fiscal
year (i.e., the decrease, if any,
in Current Assets minus Current Liabilities from the beginning to the end of
such fiscal year) over (b) the sum, without duplication, of (i) the
amount of any Taxes payable in cash by the Borrower and the Subsidiaries or,
amounts payable pursuant to Sections 6.06(a)(iii)(y) or (iv) if
applicable, with respect to such fiscal year, (ii) Consolidated Interest
Expense for such fiscal year, (iii) Capital Expenditures made in cash in
accordance with Section 6.10 during such fiscal year, except to the extent
financed with the proceeds of Indebtedness, equity issuances, casualty
proceeds, condemnation proceeds or other proceeds that would not be included in
Consolidated EBITDA, (iv) permanent repayments of Indebtedness (other than
mandatory prepayments of Loans under Section 2.12) made in cash by the
Borrower and the Subsidiaries during such fiscal year, but only to the extent
that the Indebtedness so prepaid by its terms cannot be reborrowed or redrawn
and such prepayments do not occur in connection with a refinancing of all or
any portion of such Indebtedness and (v) additions to noncash working
capital for such fiscal year (i.e., the
increase, if any, in Current Assets minus Current Liabilities from the
beginning to the end of such fiscal year).


 


Excluded Taxes”  shall mean,
with respect to the Administrative Agent, any Lender or any other recipient of
any payment to be made by or on account of any


 


9

















 


obligation of the
Borrower hereunder, (a) income, franchise or other similar taxes imposed
on (or measured by) its income by (i) the jurisdiction 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 or (ii) by reason of a present or former connection between the
recipient and the jurisdiction of the Borrower (other than such connection
arising solely from such recipient having executed, delivered, or performed its
obligations under, or enforced, this Agreement or any other Loan Documents), (b) any
branch profits taxes imposed by the United States of America or any similar tax
imposed by any other jurisdiction described in clause (a) above, (c) in
the case of a Foreign Lender, any withholding tax that is imposed on amounts
payable to such Foreign Lender at the time such Foreign Lender becomes a party
to this Agreement (or designates a new lending office) or is attributable to
such Foreign Lender’s failure to comply with Section 2.19(e), except to
the extent that such Foreign Lender (or its assignor, if any) was entitled, at
the time of designation of a new lending office (or assignment), to receive
additional amounts from the Borrower with respect to such withholding tax
pursuant to Section 2.19(a), and (d) backup withholding taxes imposed
on amounts payable to a recipient at the time such Lender becomes a party
hereto (or designates a new lending office) or is attributable to such Lender’s
failure or inability (other than as a result of a Change in Law) to comply with
Section 2.19(e), except to the extent that such 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 backup withholding tax pursuant to Section 2.19(a).


 


“Existing Credit Agreement”  shall mean that certain Credit Agreement
dated as of September 29, 2005 among the Company, Webster Bank, National
Association, as Administrative Agent and L/C Issuer, Newstar Financial, Inc.,
as Syndication Agent, The Governor and Company of the Bank of Ireland and
National City Bank, as Co-Documentation Agents and the Lenders party thereto,
as amended.


 


“Existing Debt”  shall mean the indebtedness of the
Company under the Existing Credit Agreement.


 


“Federal Funds Effective Rate”  shall mean, for any
day, the weighted average of the rates on overnight Federal funds transactions
with members of the Federal Reserve System arranged by Federal funds brokers,
as published on the next succeeding Business Day by the Federal Reserve Bank of
New York, or, if such rate is not so published for any day that is a Business
Day, the average of the quotations for the day for such transactions received
by the Administrative Agent from three Federal funds brokers of recognized
standing selected by it.


 


“Fee Letter”  shall mean the Fee Letter dated April 21,
2007, among the Borrower, Holdings, the Arranger and the Administrative Agent.


 


“Financial Officer”  of any person shall mean the chief
financial officer, principal accounting officer, treasurer or controller of
such person.


 


10

















 


“First Lien
Credit Agreement”  shall
mean the First Lien Credit Agreement dated as of the date hereof, among the
Borrower, Holdings, Credit Suisse, as administrative agent and as collateral
agent, and the lenders from time to time party thereto.


 


“First Lien
Event of Default”  shall
have the meaning assigned to such term in Article VII.


 


“First Lien
Guarantee and Collateral Agreement”  shall mean the First Lien Guarantee and
Collateral Agreement dated as of the date hereof among the Borrower, Holdings,
the Subsidiaries party thereto and Credit Suisse, as first lien collateral
agent.


 


“First Lien
Loans”  shall
mean the loans made under the First Lien Credit Agreement.


 


“First Lien Loan
Documents”  shall
mean the First Lien Credit Agreement and all other instruments, agreements and
other documents evidencing or governing the First Lien Loans or providing for
any Guarantee or other right in respect thereof.


 


“First Priority
Liens”  shall
have the meaning assigned to such term in the Intercreditor Agreement.


 


“Foreign Benefit
Event”  shall
mean, with respect to any Foreign Pension Plan, (a) the existence of
unfunded liabilities in excess of the amount permitted under any applicable law,
or in excess of the amount that would be permitted absent a waiver from a
Governmental Authority, (b) the failure to make the required contributions
or payments, under any applicable law, on or before the due date for such
contributions or payments, (c) the receipt of a notice by a Governmental
Authority relating to the intention to terminate any such Foreign Pension Plan
or to appoint a trustee or similar official to administer any such Foreign
Pension Plan, or alleging the insolvency of any such Foreign Pension Plan or (d) the
incurrence of any liability in excess of $5,000,000 by Holdings, the Borrower
or any Subsidiary under applicable law on account of the complete or partial
termination of such Foreign Pension Plan or the complete or partial withdrawal
of any participating employer therein.


 


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


 


“Foreign Pension
Plan”  shall
mean any benefit plan that covers employees of the Borrower or any Subsidiaries
who are employed outside of the United States and that is subject to any
statutory funding requirement permitting any Governmental Authority to
accelerate the obligation of the Borrower or any Subsidiaries to fund all or a
portion of the unfunded accrued benefit liabilities under such plan.


 


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


 


11

















 


“GAAP”  shall mean United States generally
accepted accounting principles applied on a consistent basis.


 


“Governmental
Authority”  shall
mean any Federal, state, local or foreign court or governmental agency,
authority, instrumentality or regulatory body.


 


“Granting Lender”  shall have the meaning assigned to such
term in Section 9.04(i).


 


“Guarantee”  of or by any person shall mean any
obligation, contingent or otherwise, of such person guaranteeing or having the
economic effect of guaranteeing any Indebtedness or other obligation of any
other person (the “primary obligor”)  in any manner,
whether directly or indirectly, and including any obligation of such person,
direct or indirect, (a) to purchase or pay (or advance or supply funds for
the purchase or payment of) such Indebtedness or other obligation or to
purchase (or to advance or supply funds for the purchase of) any security for
the payment of such Indebtedness or other obligation, (b) to purchase or
lease properly, securities or services for the purpose of assuring the owner of
such Indebtedness or other obligation of the payment of such Indebtedness or
other obligation or (c) to maintain working capital, equity capital or any
other financial statement condition or liquidity of the primary obligor so as
to enable the primary obligor to pay such Indebtedness or other obligation; provided, however, that the term “Guarantee”
shall not include endorsements for collection or deposit in the ordinary course
of business.


 


“Guarantee and Collateral Agreement”  shall mean the Second Lien Guarantee and
Collateral Agreement, substantially in the form of Exhibit D, among the
Borrower, Holdings, the Subsidiaries party thereto and the Collateral Agent for
the benefit of the Secured Parties.


 


“Guarantors”  shall mean Holdings and the Subsidiary
Guarantors.


 


“Hazardous Materials”
shall mean (a) any
petroleum products or byproducts and all other hydrocarbons, radon gas,
asbestos, polychlorinated biphenyls, chlorofluorocarbons and all other ozone-depleting
substances and (b) any chemical, material, substance or waste that is
prohibited, limited or regulated by or pursuant to any Environmental Law.


 


“Hedging
Agreement”  shall
mean any interest rate protection agreement, foreign currency exchange
agreement, commodity price protection agreement or other interest or currency
exchange rate or commodity price hedging arrangement.


 


“Inactive Subsidiary”
shall mean any Subsidiary that (a) does not conduct any
business operations, (b) has assets with a book value not in excess of
$250,000 and (c) does not have any Indebtedness outstanding.


 


“Indebtedness”
of any person shall mean, without duplication, (a) all obligations of such
person for borrowed money or with respect to deposits or advances of any kind
(excluding customer advances or deposits received in the ordinary course of
business),


 


12

















 


(b) all obligations
of such person evidenced by bonds, debentures, notes or similar instruments, (c) all
obligations of such person upon which interest charges are customarily paid, (d) all
obligations of such person under conditional sale or other title retention
agreements relating to property or assets purchased by such person, (e) all
obligations of such person issued or assumed as the deferred purchase price of
property or services (excluding trade accounts payable and accrued obligations
incurred in the ordinary course of business), (f) all Indebtedness of
others secured by (or for which the holder of such Indebtedness has an existing
right, contingent or otherwise, to be secured by) any Lien on property owned or
acquired by such person, whether or not the obligations secured thereby have
been assumed, (g) all Guarantees by such person of Indebtedness of others,
(h) all Capital Lease Obligations and Synthetic Lease Obligations of such
person and all Attributable Debt in respect of Sale/Leaseback Transactions
entered into by such person, (i) all obligations of such person as an
account party in respect of letters of credit and (j) all obligations of
such person in respect of bankers’ acceptances. The Indebtedness of any person
shall include the Indebtedness of any partnership in which such person is a
general partner, to the extent such person is liable therefor as a result of
such person’s ownership interest in, or other relationship with, such other
person, except to the extent the terms of such Indebtedness expressly provide
that such person is not liable therefor. Notwithstanding the foregoing, “Indebtedness”
shall not include indemnification, adjustment of purchase price, earn out,
contingent purchase obligations, hold back or other similar obligations, in
each case, incurred or assumed in connection with an acquisition or disposition
permitted hereunder of any business, assets or a Subsidiary, except to the
extent not paid when due (unless the same are being contested in good faith).
The amount of Indebtedness for which recourse is limited to either a specific
amount or to identified assets shall be equal to the lesser of such specified
amount or the fair market value of such asset, as the case may be.


 


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


 


“Intercreditor
Agreement”  shall
mean that certain Intercreditor Agreement dated as of the date hereof, among
the Borrower, the Subsidiaries party thereto, the Collateral Agent and First
Lien Collateral Agent (as defined therein).


 


“Interest
Election”  shall
have the meaning assigned to such term in  Section 2.06.


 


“Interest Election Request”  shall mean a notice of Interest Election
in accordance with the terms of Section 2.06 and substantially in the form
of Exhibit G.


 


“Interest
Payment Date”  shall
mean (a) with respect to any ABR Loan, the last Business
Day of each March, June, September and December, commencing September 28,
2007 and (b) with respect to any Eurodollar Loan, the last day of the
Interest Period applicable to the Borrowing of which such Loan is a part and,
in the case of a Eurodollar Borrowing with an Interest Period of more than
three months’ duration, each day that would have been an Interest Payment Date
had successive Interest Periods of three months’ duration been applicable to
such Borrowing.


 


13














 


“Interest Period”  shall mean, with respect to any
Eurodollar Borrowing, the period commencing on the date of such Borrowing and
ending on the numerically corresponding day (or, if there is no numerically
corresponding day, on the last day) in the calendar month that is 1, 2, 3 or 6
months thereafter, as the Borrower may elect (provided
that for a Borrowing on the Closing Date, the Borrower may only
elect a 1 month Interest Period); provided,
however, that if any Interest Period would end on a day other than a
Business Day, such Interest Period shall be extended to the next succeeding
Business Day unless such next succeeding Business Day would fall in the next
calendar month, in which case such Interest Period shall end on the next
preceding Business Day. Interest shall accrue from and including the first day
of an Interest Period to but excluding the last day of such Interest Period.
For purposes hereof, the date of a Borrowing initially shall be the date on
which such Borrowing is made and thereafter shall be the effective date of the
most recent conversion or continuation of such Borrowing.


 


“Lenders”  shall mean (a) the persons listed on Schedule
2.01 (other than any such person that has ceased to be a party hereto pursuant
to an Assignment and Acceptance) and (b) any person that has become a
party hereto pursuant to an Assignment and Acceptance.


 


“LIBO Rate”
shall
mean, with respect to any Eurodollar Borrowing for any Interest Period, the
rate per annum determined by the Administrative Agent at approximately 11:00 a.m.
(London time) on the date that is two Business Days prior to the commencement
of such Interest Period by reference to the British Bankers’ Association
Interest Settlement Rates for deposits in dollars (as set forth by any service
selected by the Administrative Agent that has been nominated by the British
Bankers’ Association as an authorized information vendor for the purpose of
displaying such rates) for a period equal to such Interest Period; provided that, to the extent that an
interest rate is not ascertainable pursuant to the foregoing provisions of this
definition, the “LIBO Rate” shall be the interest rate per annum determined by
the Administrative Agent to be the average of the rates per annum at which
deposits in dollars are offered for such relevant Interest Period to major
banks in the London interbank market in London, England by the Administrative
Agent at approximately 11:00 a.m. (London time) on the date that is two
Business Days prior to the beginning of such Interest Period.


 


“Lien”  shall mean, with respect to any asset, (a) any
mortgage, deed of trust, lien, pledge, encumbrance, charge or security interest
in or on such asset, (b) the interest of a vendor or a lessor under any
conditional sale agreement, capital lease or title retention agreement (or any
financing lease having substantially the same economic effect as any of the
foregoing) relating to such asset and (c) in the case of securities, any
purchase option, call or similar right of a third party with respect to such
securities.


 


“Loan Documents”  shall
mean this Agreement, the Security Documents and the promissory notes, if any,
executed and delivered pursuant to Section 2.04(e).


 


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


 


14

















 


“Loans”  shall mean the term loans made by the
Lenders to the Borrower pursuant to Section 2.01.


 


“Margin
Stock”  shall have the meaning assigned to such
term in Regulation U.


 


“Material Adverse Effect”  shall mean (a) a materially adverse
effect on the business, assets, liabilities, operations, financial condition or
operating results of the Borrower and the Subsidiaries, taken as a whole or (b) a
material impairment of the rights and remedies of or benefits available to the
Lenders under any Loan Document.


 


“Material Indebtedness”  shall mean Indebtedness (other than the Loans), or
obligations in respect of one or more Hedging Agreements, of any one or more of
Holdings, the Borrower or any Subsidiary in an aggregate principal amount exceeding
$9,000,000. For purposes of determining Material Indebtedness, the “principal
amount” of the obligations of Holdings, the Borrower or any Subsidiary in
respect of any Hedging Agreement at any time shall be the maximum aggregate
amount (giving effect to any netting agreements) that Holdings, the Borrower or
such Subsidiary would be required to pay if such Hedging Agreement were
terminated at such time.


 


“Material Subsidiary”  shall mean, at any time, any Subsidiary that at such
time shall have assets in excess of $10,000,000 or shall have $10,000,000 in
revenues in the most recently ended fiscal year.


 


“Maturity
Date”  shall mean December 15, 2014.


 


“Merger Agreement”  shall mean the Agreement and Plan of
Merger dated as of April 21, 2007, among the Borrower, the Company and
Parent.


 


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


 


“Mortgaged
Properties”  shall mean, initially, the owned real properties of
the Loan Parties specified on Schedule 1.01(b), and shall include each other
parcel of real property and improvements thereto with respect to which a
Mortgage is granted pursuant to Section 5.11.


 


“Mortgages”  shall mean the mortgages, deeds of trust,
assignments of leases and rents, modifications and other security documents delivered
pursuant to clause (i) of paragraph (j) of Article IV or
pursuant to Section 5.11, each substantially in the form of Exhibit E.


 


“Multiemployer Plan”  shall mean a multiemployer plan as
defined in Section 4001(a)(3) of ERISA.


 


“Net Cash Proceeds”  shall mean (a) with respect to any
Asset Sale, the cash proceeds (including cash proceeds subsequently received
(as and when received) in respect of noncash consideration initially received),
net of (i) selling expenses (including reasonable broker’s fees or
commissions, legal fees, transfer and similar taxes and the Borrower’s good
faith estimate of income taxes paid or payable in connection with such


 


15

















 


sale), (ii) amounts
provided as a reserve, in accordance with GAAP, against any liabilities under
any indemnification obligations or purchase price adjustment associated with
such Asset Sale (provided that, to the extent and at
the time any such amounts are released from such reserve, such amounts shall
constitute Net Cash Proceeds) and (iii) the principal amount, premium or
penalty, if any, interest and other amounts on any Indebtedness for borrowed
money that is secured by the asset sold in such Asset Sale and that is required
to be repaid with such proceeds (other than any such Indebtedness assumed by
the purchaser of such asset); provided,
however, that, if (x) the Borrower shall deliver a certificate
of a Financial Officer to the Administrative Agent at the time of receipt
thereof setting forth the Borrower’s intent to reinvest such proceeds in
productive assets of a kind then used or usable in the business of the Borrower
and its Subsidiaries within 365 days of receipt of such proceeds and (y) no
Default or Event of Default shall have occurred and shall be continuing at the
time of such certificate or at the proposed time of the application of such
proceeds, such proceeds shall not constitute Net Cash Proceeds except to the
extent not so used at the end of such 365-day period, at which time such
proceeds shall be deemed to be Net Cash Proceeds; and (b) with respect to
any issuance or incurrence of Indebtedness or any Specified Equity Issuance,
the cash proceeds thereof, net of all taxes and customary fees, commissions,
costs and other expenses incurred in connection therewith.


 


“Obligations”  shall
mean all obligations defined as “Obligations” in the Guarantee and Collateral
Agreement and the other Security Documents.


 


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


 


“Parent”  shall mean STR Holdings, Inc. and its successors
and assigns.


 


“PBGC”  shall mean the Pension Benefit Guaranty
Corporation referred to and defined in ERISA.


 


“Pension Act”  shall
mean the Pension Protection Act of 2006, as amended from time to time.


 


“Perfection Certificate”  shall mean the Perfection Certificate substantially in
the form of Exhibit B to the Guarantee and Collateral Agreement.


 


“Permitted
Acquisition”  shall have the meaning assigned to such term in Section 6.04(g).


 


“Permitted
Investments”  shall mean:


 


(a) direct obligations of, or obligations the
principal of and interest on which are unconditionally guaranteed by, the
United States of America (or by any agency thereof to the extent such
obligations are backed by the full faith and credit of the United States of
America), in each case maturing within one year from the date of acquisition
thereof;


 


16

















 


(b) direct obligations of, or obligations the
principal of and interest on which are unconditionally guaranteed by, any
participating member state of the EMU (or by any agency thereof to the extent
such obligations are backed by the full faith and credit of such participating
member state of the EMU), in each case with a rating equal to or higher than
Baa3 by Moody’s and BBB- by S&P (or the equivalent rating and rating agency
applicable for such member state) and maturing within one year from the date of
acquisition thereof;


 


(c)  investments in commercial paper maturing
within 270 days from the date of acquisition thereof and having, at such date
of acquisition, the highest credit rating obtainable from S&P or from Moody’s;


 


(d) investments in certificates of deposit,
banker’s acceptances, time deposits and eurodollar time deposits maturing
within one year from the date of acquisition thereof issued or guaranteed by or
placed with, and money market deposit accounts issued or offered by, the
Administrative Agent or any domestic office of any commercial bank organized
under the laws of the United States of America or any State thereof or any
foreign commercial bank organized under the laws of a participating member
state of the EMU that has a combined capital and surplus and undivided profits
of not less than $500,000,000 in the case of U.S. banks (or the dollar
equivalent as of the date of determination in the case of non-U.S. banks);


 


(e) fully collateralized repurchase agreements
with a term of not more than 30 days for securities described in clause (a) above
and entered into with a financial institution satisfying the criteria of clause
(d) above;


 


(f) investments in “money market funds” within
the meaning of Rule 2a-7 of the Investment Company Act of 1940, as
amended, substantially all of whose assets are invested in investments of the
type described in clauses (a) through (e) above;


 


(g) investments in so-called “auction rate”
securities rated AAA or higher by S&P or Aaa or higher by Moody’s and which
have a reset date not more than 90 days from the date of acquisition thereof;
and


 


(h) other short-term investments utilized by Foreign Subsidiaries
in accordance with normal investment practices for cash management in
investments of a type analogous to the foregoing and denominated in dollars or
foreign currencies.


 


“Permitted Investors”  shall mean DLJ Merchant Banking Partners IV, L.P. and
its affiliated funds.


 


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


 


 “PIK
Interest”  shall have the meaning assigned to such term in Section 2.06.


 


17

















 


“Plan”  shall mean any employee pension benefit plan (other
than a Multiemployer Plan) subject to the provisions of Title IV of ERISA or Section 412
of the Code or Section 302 of ERISA, and in respect of which the Borrower
or any ERISA Affiliate is (or, if such plan were terminated, would under Section 4069
of ERISA be deemed to be) an “employer” as defined in Section 3(5) of
ERISA.


 


“Pledged Collateral”  shall have the meaning assigned to such
term in the Guarantee and Collateral Agreement.


 


“Prime Rate”  shall
mean the rate of interest per annum determined from time to time by Credit
Suisse as its prime rate in effect at its principal office in New York City and
notified to the Borrower.


 


“Qualified Capital
Stock”  of any person shall mean any Equity
Interest of such person that is not Disqualified Stock.


 


“Qualified Public
Offering” shall
mean the initial underwritten public offering of common Equity Interests of
Holdings or the Borrower pursuant to an effective registration statement filed
with the Securities and Exchange Commission in accordance with the Securities
Act of 1933, as amended, that results in at least $50,000,000 of Net Cash
Proceeds to Holdings.


 


“Register” shall have the meaning assigned to such term in Section 9.04(d).


 


“Regulation
T” shall
mean Regulation T of the Board as from time to time in effect and all official
rulings and interpretations thereunder or thereof.


 


“Regulation
U” shall
mean Regulation U of the Board as from time to time in effect and all official
rulings and interpretations thereunder or thereof.


 


“Regulation
X”  shall mean Regulation X of the Board as
from time to time in effect and all official rulings and interpretations
thereunder or thereof.


 


“Related
Fund”  shall
mean, with respect to any Lender that is a fund or commingled investment
vehicle that invests in bank loans, any other fund that invests in bank loans
and is managed or advised by the same investment advisor as such Lender or by
an Affiliate of such investment advisor.


 


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


 


“Release”  shall mean any release, spill, emission, leaking,
dumping, injection, pouring, deposit, disposal, discharge, dispersal, leaching
or migration into or through the environment or within or upon any building,
structure, facility or fixture.


 


18

















 


“Required
Lenders” shall
mean, at any time, Lenders having Loans and Commitments representing more than
50% of the sum of all Loans outstanding and Commitments at such time.


 


“Required
Prepayment Percentage”  shall mean in the case of any Excess Cash Flow, 50%
or, if on the date of the applicable prepayment (and after giving effect
thereto, in whole or in part), the Total Leverage Ratio is less than 5.25 to
1.00 but greater than or equal to 4.50 to 1.00, 25%, or, if on the date of the
applicable prepayment, the Total Leverage Ratio is less than 4.50 to 1.00, 0%.


 


“Responsible
Officer”
of any person shall mean any executive officer or Financial Officer of such
person and any other officer or similar official thereof responsible for the
administration of the obligations of such person in respect of this Agreement.


 


“Restricted Indebtedness”  shall mean Indebtedness of Holdings, the Borrower or
any Subsidiary, the payment, prepayment, repurchase or defeasance of which is
restricted under Section 6.09(b).


 


“Restricted
Payment”  shall mean any dividend or other
distribution (whether in cash, securities or other property (other than
Qualified Capital Stock)) with respect to any Equity Interests in Holdings, the
Borrower or any Subsidiary, or any payment (whether in cash, securities or
other property (other than Qualified Capital Stock)), including any sinking
fund or similar deposit, on account of the purchase, redemption, retirement,
acquisition, cancellation or termination of any Equity Interests in Holdings,
the Borrower or any Subsidiary. For greater certainty, the payment of fees
pursuant to the Advisory Services and Monitoring Agreements shall not
constitute a Restricted Payment under Section 6.06(a).


 


“Sale/Leaseback
Transaction” means an arrangement, directly or indirectly, with any person relating
to property, real or personal or mixed, used or useful in the business of the
Borrower or any Subsidiary, whether now owned or acquired after the Closing
Date, whereby the Borrower or any Subsidiary sells or transfers such property
to a person and thereafter rents or leases such property or other property
which it intends to use for substantially the same purpose or purposes as the
property being sold or transferred.


 


“Secured
Parties”  shall have the meaning assigned to such term in the
Guarantee and Collateral Agreement.


 


“Security
Documents” shall mean the Mortgages, the Guarantee and Collateral Agreement, the
Intercreditor Agreement and each of the security agreements, mortgages and
other instruments and documents executed and delivered pursuant to any of the
foregoing or pursuant to Section 5.11.


 


“Significant
Asset Sale” shall mean the sale, transfer, lease or other disposition by Holdings
or any Subsidiary to any person other than the Borrower or a Subsidiary
Guarantor of all or substantially all of the assets of, or a majority of the
Equity Interests in, a person, or a division or line of business or other
business unit of a person.


 


19

















 


“S&P”  shall mean Standard &  Poor’s Ratings Service, or any successor
thereto.


 


“Spanish Subsidized
Loans”  shall mean government-subsidized loans in advance made
as part of an official program of the Ministry of Economic Development of Spain
(the “Spanish
Ministry”), representing funds pledged to STR España
as incentive for economic development in the country of Spain and/or the region
of Asturias, Spain, the interest and principal of which are relieved by the
Spanish Ministry upon completion of STR España’s approved development program
(capital investment, job creation, employee training, etc.).


 


“SPC” shall have the meaning assigned to such
term in Section 9.04(i).


 


“Specified
Equity Issuance”  shall mean any public issuance or sale by
Holdings, the Borrower or any of their respective subsidiaries of any Equity
Interests of Holdings, the Borrower or any such subsidiary, as applicable,
other than public offerings with respect to Holding’s, the Borrower’s or any of
their respective subsidiaries’ Equity Interests registered on Form S-4 or Form S-8.


 


“Statutory Reserves”  shall mean a fraction (expressed as a
decimal), the numerator of which is the number one and the denominator of which
is the number one minus the aggregate of the maximum reserve percentages
(including any marginal, special, emergency or supplemental reserves) expressed
as a decimal established by the Board and any other banking authority, domestic
or foreign, to which the Administrative Agent or any Lender (including any branch,
Affiliate or other fronting office making or holding a Loan) is subject for
Eurocurrency Liabilities (as defined in Regulation D of the Board). Eurodollar
Loans shall be deemed to constitute Eurocurrency Liabilities (as defined in
Regulation D of the Board) and to be subject to such reserve requirements
without benefit of or credit for proration, exemptions or offsets that may be
available from time to time to any Lender under such Regulation D. Statutory
Reserves shall be adjusted automatically on and as of the effective date of any
change in any reserve percentage.


 


“STR
España”  shall mean Specialized Technology Resources España
S.A., a stock corporation formed under the laws of Spain and wholly owned by
the Borrower.


 


“subsidiary”  shall mean, with respect to any person
(herein referred to as the “parent”),  any corporation, partnership, limited
liability company, association or other business entity (a) of which
securities or other ownership interests representing more than 50% of the
equity or more than 50% of the ordinary voting power or more than 50% of the
general partnership interests are, at the time any determination is being made,
owned, Controlled or held, or (b) that is, at the time any determination
is made, otherwise Controlled, by the parent or one or more subsidiaries of the
parent or by the parent and one or more subsidiaries of the parent.


 


“Subsidiary”  shall mean any subsidiary of the
Borrower.


 


20

















 


“Subsidiary
Guarantor”  shall mean each Subsidiary listed on
Schedule 1.01(a), and each other Subsidiary that is or becomes a party to the
Guarantee and Collateral Agreement.


 


“Synthetic
Lease” shall
mean, as to any person, any lease (including leases that may be terminated by
the lessee at any time) of any property (whether real, personal or mixed) (a) that
is accounted for as an operating lease under GAAP and (b) in respect of
which the lessee retains or obtains ownership of the property so leased for
U.S. federal income tax purposes, other than any such lease under which such
person is the lessor.


 


“Synthetic
Lease Obligations”  shall mean, as to any person, an amount
equal to the capitalized amount of the remaining lease payments under any
Synthetic Lease that would appear on a balance sheet of such person in
accordance with GAAP if such obligations were accounted for as Capital Lease
Obligations.


 


“Synthetic
Purchase Agreement”  shall mean any swap, derivative or other
agreement or combination of agreements pursuant to which Holdings, the Borrower
or any Subsidiary is or may become obligated to make (a) any payment in
connection with a purchase by any third party from a person other than
Holdings, the Borrower or any Subsidiary of any Equity Interest or Restricted
Indebtedness or (b) any payment (other than on account of a permitted
purchase by it of any Equity Interest or Restricted Indebtedness) the amount of
which is determined by reference to the price or value at any time of any
Equity Interest or Restricted Indebtedness; provided
that no phantom stock or similar plan providing for payments only to
current or former directors, officers or employees of Holdings, the Borrower or
the Subsidiaries (or to their heirs or estates) shall be deemed to be a
Synthetic Purchase Agreement.


 


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


 


‘‘Total
Debt”  shall mean, at any time, the total
Indebtedness of the Borrower and the Subsidiaries at such time (excluding
Indebtedness of the type described in clause (i) of the definition of such
term, except to the extent of any unreimbursed drawings thereunder).


 


“Total Leverage Ratio”  shall mean, on any date, the ratio of
Total Debt (net of unrestricted cash and cash equivalents of the Borrower and
the Subsidiaries (in each case in the amount determined by GAAP)) on such date
to Consolidated EBITDA for the period of four consecutive fiscal quarters most
recently ended on or prior to such date. In any period of four consecutive
fiscal quarters in which a Permitted Acquisition or Significant Asset Sale
occurs, the Total Leverage Ratio shall be determined on a pro forma basis in
accordance with Section 1.03.


 


“Transactions”  shall mean, collectively, (a) the
execution, delivery and performance by Parent, the Company and the Borrower of
the Merger Agreement and the consummation of the transactions contemplated
thereby, (b) the execution, delivery and performance by Holdings, the
Borrower and the Subsidiaries party thereto of the First


 


21

















 


Lien Loan Documents and
the incurrence of the First Lien Loans, (c) the execution, delivery and
performance by the Loan Parties of the Loan Documents to which they are a party
and the making of the Borrowings hereunder, (d) the repayment of all
amounts due or outstanding under or in respect of, and the termination of, the
Existing Credit Agreement and (e) the payment of related fees and
expenses.


 


“Type”, when used in respect of any Loan or Borrowing, shall
refer to the Rate by reference to which interest on such Loan or on the Loans
comprising such Borrowing is determined. For purposes hereof, the term “Rate” shall
mean the Adjusted LIBO Rate and the Alternate Base Rate.


 


“USA PATRIOT Act”  shall mean The Uniting and Strengthening
America by Providing Appropriate Tools Required to Intercept and Obstruct
Terrorism Act of 2001 (Title III of Pub. L. No. 107-56 (signed into law October 26,
2001)).


 


“wholly
owned Subsidiary”  of any person shall mean a subsidiary of such person
of which securities (except for directors’ qualifying shares) or other
ownership interests representing 100% of the Equity Interests are, at the time
any determination is being made, owned, Controlled or held by such person or
one or more wholly owned Subsidiaries of such person or by such person and one
or more wholly owned Subsidiaries of such person.


 


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


 


SECTION 1.02. Terms
Generally. The
definitions in Section 1.01 shall apply equally to both the singular and
plural forms of the terms defined. Whenever the context may require, any
pronoun shall include the corresponding masculine, feminine and neuter forms.
The words “include”, “includes” and “including” shall be deemed to be followed
by the phrase “without limitation”. The word “will” shall be construed to have
the same meaning and effect as the word “shall”; and the words “asset” and “property”
shall be construed as having 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. All references herein to Articles,
Sections, Exhibits and Schedules shall be deemed references to Articles and
Sections of, and Exhibits and Schedules to, this Agreement unless the context
shall otherwise require. Except as otherwise expressly provided herein, (a) any
reference in this Agreement to any Loan Document shall mean such document as
amended, restated, supplemented or otherwise modified from time to time and (b) all
terms of an accounting or financial nature shall be construed in accordance
with GAAP, as in effect from time to time; provided,
however, that if the Borrower notifies the Administrative Agent that
the Borrower wishes to amend any covenant in Article VI or any related
definition to eliminate the effect of any change in GAAP occurring after the
date of this Agreement on the operation of such covenant (or if the
Administrative Agent notifies the Borrower that the Required Lenders wish to
amend Article VI or any related definition for such purpose), then the
Borrower’s compliance with such covenant shall be determined on the basis of
GAAP in effect immediately


 


22

















 


before the
relevant change in GAAP became effective, until either such notice is withdrawn
or such covenant is amended in a manner satisfactory to the Borrower and the
Required Lenders.


 


SECTION 1.03. Pro Forma Calculations. With respect to
any period of four consecutive fiscal quarters during which any Permitted
Acquisition or Significant Asset Sale occurs (and for purposes of determining
whether an acquisition is a Permitted Acquisition under Section 6.04(g) or
would result in a Default or an Event of Default), the Total Leverage Ratio
shall be calculated with respect to such period on a pro forma basis after
giving effect to such Permitted Acquisition or Significant Asset Sale
(including, without duplication, (a) all pro forma adjustments permitted
or required by Article 11 of Regulation S-X under the Securities Act of
1933, as amended and (b) pro forma adjustments for cost savings (net of
continuing associated expenses) to the extent such cost savings are factually
supportable, are expected to have a continuing impact and have been realized or
are reasonably expected to be realized within 12 months following such Permitted
Acquisition; provided that all
such adjustments shall be set forth in a reasonably detailed certificate of a
Financial Officer of the Borrower), using, for purposes of making such
calculations, the historical financial statements of the Borrower and the
Subsidiaries which shall be reformulated as if such Permitted Acquisition or
Significant Asset Sale, and any other Permitted Acquisitions and Significant
Asset Sales that have been consummated during the period, had been consummated
on the first day of such period.


 


SECTION 1.04. Classjfication
of Loans and Borrowings. For
purposes of this Agreement, Loans may be classified and referred to by Type (e.g., a
“Eurodollar Loan”). Borrowings also may be classified and referred to by Type (e.g., a
“Eurodollar Borrowing”).


 


ARTICLE II


 


The Credits


 


SECTION 2.01. Commitments.  Subject to the terms and conditions and
relying upon the representations and warranties herein set forth, each Lender
agrees, severally and not jointly, to make a Loan to the Borrower on the
Closing Date in a principal amount not to exceed its Commitment. Amounts paid
or prepaid in respect of Loans may not be reborrowed.


 


SECTION 2.02. Loans.
(a) Each Loan shall be made as part of a Borrowing consisting
of Loans made by the Lenders ratably in accordance with their applicable
Commitments; provided, however, that
the failure of any Lender to make any Loan shall not in itself relieve any
other Lender of its obligation to lend hereunder (it being understood, however,
that no Lender shall be responsible for the failure of any other Lender to make
any Loan required to be made by such other Lender). The Loans comprising any
Borrowing shall be in an aggregate principal amount that is an integral
multiple of $100,000 and not less than $500,000.


 


23














 


(b)   Subject
to Sections 2.08 and 2.14, each Borrowing shall be comprised entirely of ABR
Loans or Eurodollar Loans as the Borrower may request pursuant to Section 2.03.
Each Lender may at its option make any Eurodollar Loan by causing any domestic
or foreign branch or Affiliate of such Lender to make such Loan; provided that any exercise of such option
shall not affect the obligation of the Borrower to repay such Loan in
accordance with the terms of this Agreement. Borrowings of more than one Type
may be outstanding at the same time; provided,
however, that the Borrower shall not be entitled to request any
Borrowing that, if made, would result in more than five Eurodollar Borrowings
outstanding hereunder at any time. For purposes of the foregoing, Borrowings
having different Interest Periods, regardless of whether they commence on the
same date, shall be considered separate Borrowings.


 


(c)   Each
Lender shall make each Loan to be made by it hereunder on the proposed date
thereof by wire transfer of immediately available funds to such account in New
York City as the Administrative Agent may designate not later than 1:00 p.m.,
New York City time, and the Administrative Agent shall promptly credit the
amounts so received to an account designated by the Borrower in the applicable
Borrowing Request or, if a Borrowing shall not occur on such date because any
condition precedent herein specified shall not have been met, return the
amounts so received to the respective Lenders.


 


(d)   Unless the
Administrative Agent shall have received notice from a Lender prior to the date
of any Borrowing that such Lender will not make available to the Administrative
Agent such Lender’s portion of such Borrowing, the Administrative Agent may
assume that such Lender has made such portion available to the Administrative
Agent on the date of such Borrowing in accordance with paragraph (c) above
and the Administrative Agent may, in reliance upon such assumption, make
available to the Borrower on such date a corresponding amount. If the
Administrative Agent shall have so made funds available then, to the extent
that such Lender shall not have made such portion available to the
Administrative Agent, such Lender and the Borrower severally agree to repay to
the Administrative Agent forthwith on demand such corresponding amount together
with interest thereon, for each day from the date such amount is made available
to the Borrower to but excluding the date such amount is repaid to the
Administrative Agent at (i) in the case of the Borrower, a rate per annum
equal to the interest rate applicable at the time to the Loans comprising such
Borrowing and (ii) in the case of such Lender, a rate determined by the
Administrative Agent to represent its cost of overnight or short-term funds
(which determination shall be conclusive absent manifest error). If such Lender
shall repay to the Administrative Agent such corresponding amount, such amount
shall constitute such Lender’s Loan as part of such Borrowing for purposes of
this Agreement.


 


SECTION 2.03. Borrowing Procedure.  In order to request a Borrowing, the
Borrower shall notify the Administrative Agent of such request by telephone (a) in
the case of a Eurodollar Borrowing, not later than 12:00 (noon), New York City
time, three Business Days before a proposed Borrowing, and (b) in the case
of an ABR Borrowing, not later than 12:00 noon, New York City time, one
Business Day before a proposed Borrowing. 
Each such telephonic Borrowing Request shall be irrevocable, and shall
be


 


24

















 


confirmed
promptly by hand delivery or fax to the Administrative Agent of a written
Borrowing Request and shall specify the following information: (i) whether
such Borrowing is to be a Eurodollar Borrowing or an ABR Borrowing; (ii) the
date of such Borrowing (which shall be a Business Day); (iii) the number
and location of the account to which funds are to be disbursed; (iv) the
amount of such Borrowing; and (v) if such Borrowing is to be a Eurodollar
Borrowing, the Interest Period with respect thereto; provided, however, that, notwithstanding any contrary
specification in any Borrowing Request, each requested Borrowing shall comply
with the requirements set forth in Section 2.02. If no election as to the
Type of Borrowing is specified in any such notice, then the requested Borrowing
shall be an ABR Borrowing. If no Interest Period with respect to any Eurodollar
Borrowing is specified in any such notice, then the Borrower shall be deemed to
have selected an Interest Period of one month’s duration. The Administrative
Agent shall promptly advise the applicable Lenders of any notice given pursuant
to this Section 2.03 (and the contents thereof), and of each Lender’s
portion of the requested Borrowing.


 


SECTION 2.04. Evidence of Debt;  Repayment of
Loans.  (a) The
Borrower hereby unconditionally promises to pay to the Administrative Agent for
the account of each Lender the principal amount of each Loan of such Lender on
the Maturity Date.


 


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


 


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


 


(d)   The entries made in the
accounts maintained pursuant to paragraphs (b) and (c) above shall be
prima facie evidence of the
existence and amounts of the obligations therein recorded; provided, however, that the failure of any
Lender or the Administrative Agent to maintain such accounts or any error
therein shall not in any manner affect the obligations of the Borrower to repay
the Loans in accordance with their terms.


 


(e)   Any Lender may request
that Loans made by it hereunder be evidenced by a promissory note. In such
event, the Borrower shall execute and deliver to such Lender a promissory note
payable to such Lender and its registered assigns and in a form and substance
reasonably acceptable to the Administrative Agent and the Borrower. Notwithstanding
any other provision of this Agreement, in the event any Lender shall request
and receive such a promissory note, the interests represented by such note
shall at all times (including after any assignment of all or part of such
interests pursuant to


 


25

















 


Section 9.04)
be represented by one or more promissory notes payable to the payee named
therein or its registered assigns.


 


SECTION 2.05. Fees.
(a) The Borrower agrees to pay to the Administrative Agent, for
its own account, the administrative fees set forth in the Fee Letter at the
times and in the amounts specified therein (the
“Administrative Agent Fees”).


 


(b)   All fees shall be paid
on the dates due, in immediately available funds, to the Administrative Agent
for distribution, if and as appropriate, among the Lenders. Once paid, none of
the fees shall be refundable under any circumstances.


 


SECTION 2.06. 
Interest on
Loans.  (a) Upon the terms and subject to the conditions of this
Agreement, the Lenders grant the Borrower, for any Interest Period commencing
prior to the fifth anniversary of the Closing Date, an option to pay interest
on the Loans (i) entirely in cash (“Cash Interest”)  or (ii) entirely by increasing the
outstanding principal amount of the Loans by the amount of interest accrued
during such Interest Period (“PIK Interest”). The
Borrower must elect (the “Interest
Election”)  the
form of payment of interest with respect to each Interest Period by delivering
an Interest Election Request to the Administrative Agent no later than five
Business Days prior to the start of such Interest Period. The Administrative
Agent shall promptly deliver a corresponding notice to each Lender. In the
absence of such an Interest Election for any Interest Period, interest on the
Loans shall be payable as Cash Interest.


 


(b)   Subject to the
provisions of Section 2.07, Cash Interest on Loans comprising each ABR
Borrowing shall bear interest (computed on the basis of the actual number of
days elapsed over a year of 365 or 366 days, as the case may be, when the
Alternate Base Rate is determined by reference to the Prime Rate and over a
year of 360 days at all other times and calculated from and including the date
of such Borrowing to but excluding the date of repayment thereof) at a rate per
annum equal to the Alternate Base Rate plus the Applicable Percentage in effect
from time to time.


 


(c)   Subject to the
provisions of Section 2.07, Cash Interest on Loans comprising each
Eurodollar Borrowing shall bear interest (computed on the basis of the actual
number of days elapsed over a year of 360 days) at a rate per annum equal to
the Adjusted LIBO Rate for the Interest Period in effect for such Borrowing
plus the Applicable Percentage in effect from time to time.


 


(d)   Notwithstanding anything
to the contrary in this Section 2.06, PIK Interest on the Loans shall bear
interest at the rate otherwise applicable to such Loan pursuant to Section 2.06(c) or
(d), as applicable, plus 1.50% per annum.


 


(e)   Interest on each Loan shall
be payable on the Interest Payment Dates applicable to such Loan except as
otherwise provided in this Agreement. The applicable Alternate Base Rate or
Adjusted LIBO Rate for each Interest Period or day within an Interest Period,
as the case may be, shall be determined by the Administrative Agent, and such
determination shall be conclusive absent manifest error.


 


26

















 


SECTION 2.07. Default Interest.  If
the Borrower shall default in the payment of any principal of or interest on
any Loan or any other amount due hereunder, by acceleration or otherwise, or
under any other Loan Document, then, until such defaulted amount shall have
been paid in full, to the extent permitted by law, all overdue amounts
outstanding under this Agreement and the other Loan Documents shall bear
interest (after as well as before judgment), payable on demand, (a) in the
case of principal, at the rate otherwise applicable to such Loan pursuant to Section 2.06
plus 2.00% per annum and (b) in all other cases, at a rate per annum
(computed on the basis of the actual number of days elapsed over a year of 365
or 366 days, as the case may be, when determined by reference to the Prime Rate
and over a year of 360 days at all other times) equal to the rate that would be
applicable to an ABR Loan plus 2.00% per annum.


 


SECTION 2.08. Alternate Rate of Interest.  In the event, and on each occasion, that
on the day two Business Days prior to the commencement of any Interest Period
for a Eurodollar Borrowing the Administrative Agent shall have determined that
dollar deposits in the principal amounts of the Loans comprising such Borrowing
are not generally available in the London interbank market, or that the rates
at which such dollar deposits are being offered will not adequately and fairly
reflect the cost to any Lender of making or maintaining its Eurodollar Loan
during such Interest Period, or that reasonable means do not exist for
ascertaining the Adjusted LIBO Rate, the Administrative Agent shall, as soon as
practicable thereafter, give written or fax notice of such determination to the
Borrower and the Lenders. In the event of any such determination, until the
Administrative Agent shall have advised the Borrower and the Lenders that the
circumstances giving rise to such notice no longer exist, any request by the
Borrower for a Eurodollar Borrowing pursuant to Section 2.03 or 2.10 shall
be deemed to be a request for an ABR Borrowing. Each determination by the
Administrative Agent under this Section 2.08 shall be conclusive absent
manifest error


 


SECTION 2.09. Termination
and Reduction of Commitments. (a) The Commitments shall
automatically terminate upon the making of the Loans on the Closing Date.
Notwithstanding the foregoing, all the Commitments shall automatically
terminate at 5:00 p.m., New York City time, on June 30, 2007, or such
earlier date on which the Merger Agreement terminates, if the Borrowing of the
Loans shall not have occurred by such time.


 


(b)   Upon at least three
Business Days’ prior irrevocable written or fax notice to the Administrative
Agent, the Borrower may at any time in whole permanently terminate, or from
time to time in part permanently reduce, the Commitments; provided, however,  that each
partial reduction of the Commitments shall be in an integral multiple of
$1,000,000 and in a minimum amount of $1,000,000.


 


(c)   Each reduction in the
Commitments hereunder shall be made ratably among the Lenders in accordance
with their respective applicable Commitments.


 


SECTION 2.10. Conversion and Continuation of Borrowings.
The Borrower shall have the right at any time upon prior irrevocable
notice to the Administrative Agent (a) not later than 12:00 (noon), New
York City time, one Business Day prior to


 


27

















 


conversion,
to convert any Eurodollar Borrowing into an ABR Borrowing, (b) not later
than 12:00 (noon), New York City time, three Business Days prior to conversion
or continuation, to convert any ABR Borrowing into a Eurodollar Borrowing or to
continue any Eurodollar Borrowing as a Eurodollar Borrowing for an additional
Interest Period, and (c) not later than 12:00 (noon), New York City time,
three Business Days prior to conversion, to convert the Interest Period with
respect to any Eurodollar Borrowing to another permissible Interest Period,
subject in each case to the following:


 


(i)   until
the Administrative Agent shall have notified the Borrower that the primary
syndication of the Commitments has been completed (which notice shall be given
as promptly as practicable and, in any event, within 30 days after the Closing
Date), no LIBOR Borrowing may have an Interest Period in excess of one month;


 


(ii)   each
conversion or continuation shall be made pro rata among the Lenders in
accordance with the respective principal amounts of the Loans comprising the
converted or continued Borrowing;


 


(iii)   if
less than all the outstanding principal amount of any Borrowing shall be
converted or continued, then each resulting Borrowing shall satisfy the
limitations specified in Sections 2.02(a) and 2.02(b) regarding the
principal amount and maximum number of Borrowings of the relevant Type;


 


(iv)   each
conversion shall be effected by each Lender and the Administrative Agent by
recording for the account of such Lender the new Loan of such Lender resulting
from such conversion and reducing the Loan (or portion thereof) of such Lender
being converted by an equivalent principal amount; accrued interest on any
Eurodollar Loan (or portion thereof) being converted shall be paid by the
Borrower at the time of conversion;


 


(v)   if any
Eurodollar Borrowing is converted at a time other than the end of the Interest
Period applicable thereto, the Borrower shall pay, upon demand, any amounts due
to the Lenders pursuant to Section 2.15;


 


(vi)   any
portion of a Borrowing maturing or required to be repaid in less than one month
may not be converted into or continued as a Eurodollar Borrowing;


 


(vii)   any
portion of a Eurodollar Borrowing that cannot be converted into or continued as
a Eurodollar Borrowing by reason of the immediately preceding clause shall be
automatically converted at the end of the Interest Period in effect for such
Borrowing into an ABR Borrowing;


 


(viii)   no
Interest Period may be selected for any Eurodollar Borrowing that would end
later than the Maturity Date; and


 


(ix)   upon
notice to the Borrower from the Administrative Agent given at the request of
the Required Lenders, after the occurrence and during the


 


28

















 


continuance of a Default or Event of Default, no outstanding Loan may
be converted into, or continued as, a Eurodollar Loan.


 


Each notice pursuant to this Section 2.10 shall
be irrevocable and shall refer to this Agreement and specify (i) the
identity and amount of the Borrowing that the Borrower requests be converted or
continued, (ii) whether such Borrowing is to be converted to or continued
as a Eurodollar Borrowing or an ABR Borrowing, (iii) if such notice
requests a conversion, the date of such conversion (which shall be a Business
Day) and (iv) if such Borrowing is to be converted to or continued as a
Eurodollar Borrowing, the Interest Period with respect thereto. If no Interest
Period is specified in any such notice with respect to any conversion to or
continuation as a Eurodollar Borrowing, the Borrower shall be deemed to have
selected an Interest Period of one month’s duration. The Administrative Agent
shall advise the Lenders of any notice given pursuant to this Section 2.10
and of each Lender’s portion of any converted or continued Borrowing. If the
Borrower shall not have given notice in accordance with this Section 2.10
to continue any Borrowing into a subsequent Interest Period (and shall not
otherwise have given notice in accordance with this Section 2.10 to
convert such Borrowing), such Borrowing shall, at the end of the Interest
Period applicable thereto (unless repaid pursuant to the terms hereof),
automatically be continued into an ABR Borrowing.


 


SECTION 2.11. Optional Prepayment.  (a) Subject to
payment of any applicable premium as set forth in paragraph (b) below, the
Borrower shall have the right at any time and from time to time to prepay any
Borrowing, in whole or in part, upon at least three Business Days’ prior
written or fax notice (or telephone notice promptly confirmed by written or fax
notice) in the case of Eurodollar Loans, or written or fax notice (or telephone
notice promptly confirmed by written or fax notice) at least one Business Day
prior to the date of prepayment in the case of ABR Loans, to the Administrative
Agent before 12:00 (noon), New York City time; provided,
however,  that each partial prepayment shall
be in an amount that is an integral multiple of $100,000 and not less than
$1,000,000.


 


(b)   Each prepayment of Loans
made pursuant to Section 2.11(a) shall be made together with a
prepayment premium in an amount equal to (i) if such prepayment is made
prior to the first anniversary of the Closing Date, 2.00%, and (ii) if
such prepayment is made on or after the first anniversary of the Closing Date
but prior to the second anniversary of the Closing Date, 1.00%, in each case of
the aggregate principal amount of Loans being prepaid.


 


(c)   Each notice of
prepayment shall specify the prepayment date, the principal amount of each
Borrowing (or portion thereof) to be prepaid, shall be irrevocable (unless such
notice is expressly conditioned upon a refinancing of the Credit Facility, in
which case such notice may be rescinded if such refinancing shall not be consummated
or shall otherwise be delayed) and shall commit the Borrower to prepay such
Borrowing by the amount stated therein on the date stated therein. All
prepayments under this Section 2.11 shall be subject to paragraph (b) above
(if applicable) and to Section 2.15 but otherwise without premium or penalty.
All prepayments under this Section 2.11 shall be


 


29

















 


accompanied
by accrued and unpaid interest on the principal amount to be prepaid to but
excluding the date of payment.


 


SECTION 2.12. Mandatory Prepayments.  (a) Subject
to paragraph (f) of this Section 2.12, not later than the third
Business Day following the receipt of Net Cash Proceeds in respect of any Asset
Sale, the Borrower shall apply 100% of the Net Cash Proceeds received with
respect thereto to prepay outstanding Loans.


 


(b)   Subject to paragraph (f) of
this Section 2.12, in the event and on each occasion that an Specified
Equity Issuance occurs, the Borrower shall, substantially simultaneously with
(and in any event not later than the third Business Day next following) the
occurrence of such Specified Equity Issuance, apply 50% of the Net Cash
Proceeds therefrom to prepay outstanding Loans.


 


(c)   Subject to paragraph (f) of
this Section 2.12, no later than the later of (i) 120 days after the
end of each fiscal year of the Borrower, commencing with the fiscal year ending
on December 31, 2007, and (ii) the 10th day subsequent to the date on
which the financial statements with respect to such period are delivered
pursuant to Section 5.04(a), the Borrower shall prepay outstanding Loans
in an aggregate principal amount equal to the Required Prepayment Percentage of
Excess Cash Flow for the fiscal year then ended.


 


(d)   Subject to paragraph (f) of
this Section 2.12, in the event that any Loan Party or any subsidiary of a
Loan Party shall receive Net Cash Proceeds from the issuance or incurrence of
Indebtedness for money borrowed of any Loan Party or any subsidiary of a Loan
Party (other than any cash proceeds from the issuance or renewal of
Indebtedness permitted pursuant to Section 6.01), the Borrower shall,
substantially simultaneously with (and in any event not later than the third
Business Day next following) the receipt of such Net Cash Proceeds by such Loan
Party or such subsidiary, apply an amount equal to 100% of such Net Cash
Proceeds to prepay outstanding Loans.


 


(e)   Notwithstanding the
foregoing, any Lender may elect, by written notice to the Administrative Agent
at the time and in the manner specified by the Administrative Agent, to decline
all (but not less than all) of its pro rata share of such mandatory prepayment
of its Loans pursuant to this Section 2.12 (such declined amounts, the “Declined Proceeds”). Any
Declined Proceeds shall be offered to the Lenders not so declining such
prepayment (with such Lenders having the right to decline any prepayment with
Declined Proceeds at the time and in the manner specified by the Administrative
Agent). To the extent such Lenders elect to decline their pro rata shares of
such Declined Proceeds, such remaining Declined Proceeds may be retained by the
Borrower.


 


(f)   Notwithstanding anything
to the contrary in this Section 2.12, until the Discharge of First Lien
Obligations shall have occurred, no mandatory prepayments of outstanding Loans
that would otherwise be required under this Section 2.12 shall be required
to be made, except with respect to the portion (if any) of the proceeds of the
event giving rise to such mandatory prepayment as shall have been rejected by
the


 


30

















 


lenders
under the First Lien Credit Agreement (and which is not required to be applied
to reduce outstanding Revolving Facility Loans and Swingline Loans thereunder
and as defined therein or to fund a cash collateral account with the
administrative agent under the First Lien Credit Agreement in an amount up to
the aggregate L/C Exposure (as defined in the First Lien Credit Agreement) at
such time), in each case in accordance with and as required by Section 2.13
of the First Lien Credit Agreement. If at the time of any prepayment pursuant
to this Section 2.12 there shall be outstanding Borrowings of different
Types or Eurodollar Borrowings with different Interest Periods, and if some but
not all Lenders shall have accepted such mandatory prepayment, then the
aggregate amount of such mandatory prepayment shall be allocated ratably to
each outstanding Borrowing of the accepting Lenders. If no Lenders exercise the
right to waive a given mandatory prepayment of the Loans pursuant to Section 2.12(e),
then, with respect to such mandatory prepayment, the amount of such mandatory
prepayment shall be applied first to Loans that are ABR Loans to the full
extent thereof before application to Loans that are Eurodollar Loans in a
manner that minimizes the amount of any payments required to be made by the
Borrower pursuant to Section 2.15.


 


(g)   The Borrower shall
deliver to the Administrative Agent, at the time of each prepayment required
under this Section 2.12, (i) a certificate signed by a Financial
Officer of the Borrower setting forth in reasonable detail the calculation of
the amount of such prepayment and (ii) to the extent practicable, at least
three days prior written notice of such prepayment. Each notice of prepayment
shall specify the prepayment date, the Type of each Loan being prepaid and the
principal amount of each Loan (or portion thereof) to be prepaid. All
prepayments of Borrowings under this Section 2.12 shall be subject to Section 2.15,
but shall otherwise be without premium or penalty, and shall be accompanied by
accrued and unpaid interest on the principal amount to be prepaid to but
excluding the date of payment.


 


SECTION 2.13. Reserve
Requirements; Change in Circumstances.  (a) Notwithstanding any other provision of this
Agreement, if any Change in Law shall impose, modify or deem applicable any
reserve, special deposit or similar requirement against assets of, deposits
with or for the account of or credit extended by any Lender (except any such
reserve requirement which is reflected in the Adjusted LIBO Rate) or shall
impose on such Lender or the London interbank market any other condition
affecting this Agreement or Eurodollar Loans made by such Lender, and the
result of any of the foregoing shall be to increase the cost to such Lender of
making or maintaining any Eurodollar Loan or to reduce the amount of any sum
received or receivable by such Lender hereunder (whether of principal, interest
or otherwise) by an amount deemed by such Lender to be material, then the
Borrower will pay to such Lender upon demand such additional amount or amounts
as will compensate such Lender for such additional costs incurred or reduction
suffered.


 


(b)   If any Lender shall have
determined that any Change in Law regarding capital adequacy has or would have
the effect of reducing the rate of return on such Lender’s capital or on the
capital of such Lender’s holding company, if any, as a consequence of this
Agreement or the Loans made pursuant hereto to a level below that which such
Lender or such Lender’s holding company could have achieved but for such


 


31

















 


Change
in Law (taking into consideration such Lender’s policies and the policies of
such Lender’s holding company with respect to capital adequacy) by an amount
deemed by such Lender to be material, then from time to time the Borrower shall
pay to such Lender such additional amount or amounts as will compensate such
Lender or such Lender’s holding company for any such reduction suffered.


 


(c)   A certificate of a
Lender setting forth the amount or amounts necessary to compensate such Lender
or its holding company, as applicable, as specified in paragraph (a) or (b) above
shall be delivered to the Borrower and shall be conclusive absent manifest
error. The Borrower shall pay such Lender the amount shown as due on any such
certificate delivered by it within 10 Business Days after its receipt of the
same.


 


(d)   Failure or delay on the
part of any Lender to demand compensation for any increased costs or reduction
in amounts received or receivable or reduction in return on capital shall not
constitute a waiver of such Lender’s right to demand such compensation; provided that the Borrower shall not be
under any obligation to compensate any Lender under paragraph (a) or (b) above
with respect to increased costs or reductions with respect to any period prior
to the date that is 120 days prior to such request if such Lender knew or could
reasonably have been expected to know of the circumstances giving rise to such
increased costs or reductions and of the fact that such circumstances would
result in a claim for increased compensation by reason of such increased costs
or reductions; provided further that
the foregoing limitation shall not apply to any increased costs or reductions
arising out of the retroactive application of any Change in Law within such 120-day
period. The protection of this Section 2.13 shall be available to each
Lender regardless of any possible contention of the invalidity or
inapplicability of the Change in Law that shall have occurred or been imposed.


 


SECTION 2.14. Change in Legality.  (a) Notwithstanding any other
provision of this Agreement, if any Change in Law shall make it unlawful for
any Lender to make or maintain any Eurodollar Loan or to give effect to its
obligations as contemplated hereby with respect to any Eurodollar Loan, then,
by written notice to the Borrower and to the Administrative Agent:


 


(i)   such
Lender may declare that Eurodollar Loans will not thereafter (for the duration
of such unlawfulness) be made by such Lender hereunder (or be continued for
additional Interest Periods) and ABR Loans will not thereafter (for such
duration) be converted into Eurodollar Loans, whereupon any request for a
Eurodollar Borrowing (or to convert an ABR Borrowing to a Eurodollar Borrowing
or to continue a Eurodollar Borrowing for an additional Interest Period) shall,
as to such Lender only, be deemed a request for an ABR Loan (or a request to continue
an ABR Loan as such for an additional Interest Period or to convert a
Eurodollar Loan into an ABR Loan, as the case may be), unless such declaration
shall be subsequently withdrawn; and


 


(ii)   such
Lender may require that all outstanding Eurodollar Loans made by it be
converted to ABR Loans, in which event all such Eurodollar Loans shall


 


32

















 


be automatically converted to ABR Loans as of the effective date of
such notice as provided in paragraph (b) below.


 


In
the event any Lender shall exercise its rights under (i) or (ii) above,
all payments and prepayments of principal that would otherwise have been
applied to repay the Eurodollar Loans that would have been made by such Lender
or the converted Eurodollar Loans of such Lender shall instead be applied to
repay the ABR Loans made by such Lender in lieu of, or resulting from the
conversion of, such Eurodollar Loans.


 


(b)   For purposes of this Section 2.14,
a notice to the Borrower by any Lender shall be effective as to each Eurodollar
Loan made by such Lender, if lawful, on the last day of the Interest Period
then applicable to such Eurodollar Loan; in all other cases such notice shall
be effective on the date of receipt by the Borrower.


 


SECTION 2.15. Indemnity.
The Borrower shall indemnify each Lender against any loss or expense
that such Lender may sustain or incur as a consequence of (a) any event,
other than a default by such Lender in the performance of its obligations
hereunder, which results in (i) such Lender receiving or being deemed to
receive any amount on account of the principal of any Eurodollar Loan prior to
the end of the Interest Period in effect therefor, (ii) the conversion of
any Eurodollar Loan to an ABR Loan, or the conversion of the Interest Period
with respect to any Eurodollar Loan, in each case other than on the last day of
the Interest Period in effect therefor, or (iii) any Eurodollar Loan to be
made by such Lender (including any Eurodollar Loan to be made pursuant to a
conversion or continuation under Section 2.10) not being made after notice
of such Loan shall have been given by the Borrower hereunder (any of the events
referred to in this clause (a) being called a “Breakage Event”)  or
(b) any default in the making of any payment or prepayment required to be
made hereunder. In the case of any Breakage Event, such loss shall include an
amount equal to the excess, as reasonably determined by such Lender, of (i) its
cost of obtaining funds for the Eurodollar Loan that is the subject of such
Breakage Event for the period from the date of such Breakage Event to the last
day of the Interest Period in effect (or that would have been in effect) for
such Loan over (ii) the amount of interest likely to be realized by such
Lender in redeploying the funds released or not utilized by reason of such
Breakage Event for such period. A certificate of any Lender setting forth any
amount or amounts that such Lender is entitled to receive pursuant to this Section 2.15
shall be delivered to the Borrower and shall be conclusive absent manifest
error.


 


SECTION 2.16. Pro Rata Treatment.  Except as required under Section 2.12(e) or 2.14,
each Borrowing, each payment or prepayment of principal of any Borrowing, each
payment of interest on the Loans, each reduction of the Commitments and each
conversion of any Borrowing to or continuation of any Borrowing as a Borrowing
of any Type shall be allocated pro rata among the Lenders in accordance with
their respective applicable Commitments (or, if such Commitments shall have
expired or been terminated, in accordance with the respective principal amounts
of their outstanding Loans). Each Lender agrees that in computing such Lender’s
portion of any Borrowing to be made hereunder, the Administrative Agent may, in
its discretion, round each Lender’s percentage of such Borrowing to the next
higher or lower whole dollar amount.


 


33














 


SECTION 2.17.
Sharing of Setoffs.  Each Lender agrees that if it shall,
through the exercise of a right of banker’s lien, setoff or counterclaim
against the Borrower or any other Loan Party, or pursuant to a secured claim
under Section 506 of Title 11 of the United States Code or other security
or interest arising from, or in lieu of, such secured claim, received by such
Lender under any applicable bankruptcy, insolvency or other similar law or
otherwise, or by any other means, obtain payment (voluntary or involuntary) in
respect of any Loan or Loans as a result of which the unpaid principal portion
of its Loans shall be proportionately less than the unpaid principal portion of
the Loans of any other Lender, it shall be deemed simultaneously to have purchased
from such other Lender at face value, and shall promptly pay to such other
Lender the purchase price for, a participation in the Loans of such other
Lender, so that the aggregate unpaid principal amount of the Loans and
participations in Loans held by each Lender shall be in the same proportion to
the aggregate unpaid principal amount of all Loans then outstanding as the
principal amount of its Loans prior to such exercise of banker’s lien, setoff
or counterclaim or other event was to the principal amount of all Loans
outstanding prior to such exercise of banker’s lien setoff or counterclaim or
other event; provided, however, that
if any such purchase or purchases or adjustments shall be made pursuant to this
Section 2.17 and the payment giving rise thereto shall thereafter be
recovered, such purchase or purchases or adjustments shall be rescinded to the
extent of such recovery and the purchase price or prices or adjustment restored
without interest. The Borrower and Holdings expressly consent to the foregoing
arrangements and agree that any Lender holding a participation in a Loan deemed
to have been so purchased may exercise any and all rights of banker’s lien,
setoff or counterclaim with respect to any and all moneys owing by the Borrower
and Holdings to such Lender by reason thereof as fully as if such Lender had
made a Loan directly to the Borrower in the amount of such participation.


 


SECTION 2.18.
Payments. (a) The Borrower shall make each payment (including principal of
or interest on any Borrowing or any fees or other amounts) hereunder and under
any other Loan Document not later than 12:00 (noon), New York City time, on the
date when due in immediately available dollars, without setoff, defense or
counterclaim. Each such payment shall be made to the Administrative Agent at
its offices at Eleven Madison Avenue, New York, NY 10010. The Administrative
Agent shall promptly distribute to each Lender any payments received by the
Administrative Agent on behalf of such Lender


 


(b)   Except as otherwise expressly provided herein,
whenever any payment (including principal of or interest on any Borrowing or
any fees or other amounts) hereunder or under any other Loan Document shall
become due, or otherwise would occur, on a day that is not a Business Day, such
payment may be made on the next succeeding Business Day, and such extension of
time shall in such case be included in the computation of interest or fees, if
applicable.


 


(c)   Unless the Administrative Agent shall have
received notice from the Borrower prior to the date on which any payment is due
to the Administrative Agent for the account of the Lenders hereunder that the
Borrower will not make such payment, the Administrative Agent may assume that
the Borrower has made such payment on such date in accordance herewith and may,
in reliance upon such assumption, distribute to the


 


34

















 


Lenders the amount due.
In such event, if the Borrower does not in fact make such payment, then each of
the Lenders severally agrees to repay to the Administrative Agent forthwith on
demand the amount so distributed to such Lender, and to pay interest thereon,
for each day from and including the date such amount is distributed to it to
but excluding the date of payment to the Administrative Agent, at a rate
determined by the Administrative Agent to represent its cost of overnight or
short-term funds (which determination shall be conclusive absent manifest
error).


 


SECTION 2.19.
Taxes.  (a) Any and all payments by or on
account of any obligation of the Borrower or any other Loan Party hereunder or
under any other Loan Document shall be made free and clear of and without
deduction for any Indemnified Taxes or Other Taxes; provided that, if the Borrower or any other Loan Party shall
be required to deduct any Indemnified Taxes or Other Taxes from such payments,
then (i) the sum payable shall be increased as necessary so that after
making all required deductions (including deductions applicable to additional
sums payable under this Section 2.19) the Administrative Agent or 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 or such Loan Party
shall make such deductions and (iii) the Borrower or such Loan Party shall
pay the full amount deducted to the relevant Governmental Authority in
accordance with applicable law.


 


(b)   The Borrower shall pay any Other Taxes to the
relevant Governmental Authority in accordance with applicable law.


 


(c)   The Borrower shall indemnify the Administrative
Agent and each Lender, within 10 Business Days after written demand therefor,
for the full amount of any Indemnified Taxes or Other Taxes paid by the
Administrative Agent or such Lender, as the case may be, on or with respect to
any payment by or on account of any obligation of the Borrower or any other
Loan Party hereunder or under any other Loan Document (including Indemnified
Taxes or Other Taxes imposed or asserted on or attributable to amounts payable
under this Section 2.19) and any penalties, interest and reasonable
expenses arising therefrom or with respect thereto (other than penalties,
interest or other expenses payable by reason of the deliberate action or
inaction of the Administrative Agent or such Lender, as the case may be),
whether or not such Indemnified Taxes or Other 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
by the Administrative Agent on behalf of itself or a Lender, shall be
conclusive absent manifest error.


 


(d)   As soon as practicable after any payment of
Indemnified Taxes or Other Taxes by the Borrower or any other Loan Party 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 reporting such payment
or other evidence of such payment reasonably satisfactory to the Administrative
Agent.


 


35

















 


(e)   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 located, or any treaty to which such
jurisdiction is a party, with respect to payments under this Agreement or 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, such properly completed
and executed documentation prescribed by applicable law or reasonably requested
by the Borrower as will permit such payments to be made without withholding or
at a reduced rate. 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 Borrower or the Administrative Agent
as will enable the Borrower or the Administrative Agent to determine whether or
not such Lender is subject to withholding or information reporting
requirements. Without limiting the generality of the foregoing, 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), two of whichever of the following is applicable:


 


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


 


(ii)    duly
completed original signed copies of IRS Form W-8ECI,


 


(iii)   in the
case of a Foreign Lender claiming the benefits of the exemption for portfolio
interest under Section 881(c) of the Code, (x) a certificate to the
effect that such Foreign Lender is not (A) a “bank” within the meaning of Section
881(c)(3)(A) of the Code, (B) a “10 percent shareholder” 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 original signed copies of IRS Form W-BEN, or


 


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


 


(f)   Any Lender that is a “United States person”, as
defined in Section 7701(a)(30) of the Code, 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 Lender becomes a Lender under
this Agreement (and from time to time thereafter upon the request of the
Borrower or the Administrative Agent) duly completed original signed copies of
IRS Form W-9, or any successor form, in order to comply with U.S. backup
withholding requirements. 


 


(g)   If the Administrative Agent or any Lender receives
a refund of any Indemnified Taxes or Other Taxes as to which it has been
indemnified by the Borrower


 


36

















 


or with respect to which
the Borrower has paid additional amounts pursuant to this Section 2.19, it
shall promptly notify the Borrower of such refund and shall, within 30 days
after receipt of such refund, pay to the Borrower an amount equal to such
refund, net of all out-of-pocket expenses of the Administrative Agent or such
Lender, as the case may be; provided,
however, that the Borrower, upon the request of the Administrative
Agent or such Lender, as applicable, agrees to repay the amount paid over to
the Borrower to the Administrative Agent or such Lender, as applicable, in the
event of the Administrative Agent or such Lender is required to repay such
refund. This paragraph shall not be construed to require the Administrative Agent
or any Lender to make available its tax returns (or any other information
relating to its taxes that it deems confidential) to the Borrower or any other
person.


 


SECTION 2.20.
Assignment of Commitments Under
Certain Circumstances; Duty to Mitigate.  (a) In the event (i) any Lender
delivers a certificate requesting compensation pursuant to Section 2.13, (ii) any
Lender delivers a notice described in Section 2.14, (iii) the
Borrower is required to pay any additional amount to any Lender or any
Governmental Authority on account of any Lender pursuant to Section 2.19
or (iv) any Lender refuses to consent to any amendment, waiver or other
modification of any Loan Document requested by the Borrower that requires the
consent of a greater percentage of the Lenders than the Required Lenders and
such amendment, waiver or other modification is consented to by the Required
Lenders, the Borrower may, at its sole expense and effort (including with
respect to the processing and recordation fee referred to in Section 9.04(b)),
upon notice to such Lender and the Administrative Agent, require such Lender to
transfer and assign, without recourse (in accordance with and subject to the
restrictions contained in Section 9.04), all of its interests, rights and
obligations under this Agreement to an Eligible Assignee that shall assume such
assigned obligations and, with respect to clause (iv) above, shall consent
to such requested amendment, waiver or other modification of any Loan Document
(which Eligible Assignee may be another Lender, if a Lender accepts such
assignment); provided that (x) such
assignment shall not conflict with any law, rule or regulation or order of
any court or other Governmental Authority having jurisdiction, (y) the
Borrower shall have received the prior written consent of the Administrative
Agent, which consent shall not unreasonably be withheld or delayed, and (z) the
Borrower or such Eligible Assignee shall have paid to the affected Lender in
immediately available funds an amount equal to the sum of the principal of and
interest accrued to the date of such payment on the outstanding Loans of such
Lender, plus all fees and other amounts accrued for the account of such Lender
hereunder with respect thereto (including any amounts under Sections 2.13 and
2.15 and, in the case of clause (iv) above, if such assignment occurs
prior to the first anniversary of the Closing Date, the prepayment fee that
would be payable pursuant to Section 2.11(b) if the Loans of such
Lender subject to such assignment had been prepaid by the Borrower pursuant to Section 2.11,
such amount to be payable by the Borrower); provided
further that, if prior to any such transfer and assignment the
circumstances or event that resulted in such Lender’s claim for compensation
under Section 2.13, notice under Section 2.14 or the amounts paid
pursuant to Section 2.19, as the case may be, cease to cause such Lender
to suffer increased costs or reductions in amounts received or receivable or
reduction in return on capital, or cease to have the consequences specified in Section 2.14,
or cease to result in amounts being payable under Section 2.19, as the
case may be (including as a


 


37

















 


result of any action
taken by such Lender pursuant to paragraph (b) below), or if such Lender
shall waive its right to claim further compensation under Section 2.13 in
respect of such circumstances or event or shall withdraw its notice under Section 2.14
or shall waive its right to further payments under Section 2.19 in respect
of such circumstances or event or shall consent to the proposed amendment,
waiver, consent or other modification, as the case may be, then such Lender
shall not thereafter be required to make any such transfer and assignment
hereunder. Each Lender hereby grants to the Administrative Agent an irrevocable
power of attorney (which power is coupled with an interest) to execute and
deliver, on behalf of such Lender as assignor, any Assignment and Acceptance
necessary to effectuate any assignment of such Lender’s interests hereunder in
the circumstances contemplated by this Section 2.20(a).


 


(b)   If (i) any Lender shall request compensation
under Section 2.13, (ii) any Lender delivers a notice described in Section 2.14
or (iii) the Borrower is required to pay any additional amount to any
Lender or any Governmental Authority on account of any Lender, pursuant to Section 2.19,
then such Lender shall use reasonable efforts (which shall not require such
Lender to incur an unreimbursed loss or unreimbursed cost or expense or
otherwise take any action inconsistent with its internal policies or legal or
regulatory restrictions or suffer any disadvantage or burden deemed by it to be
significant) (x) to file any certificate or document reasonably requested
in writing by the Borrower or (y) to assign its rights and delegate and
transfer its obligations hereunder to another of its offices, branches or
affiliates, if such filing or assignment would reduce its claims for
compensation under Section 2.13 or enable it to withdraw its notice
pursuant to Section 2.14 or would reduce amounts payable pursuant to Section 2.19,
as the case may be, in the future. The Borrower hereby agrees to pay all
reasonable costs and expenses incurred by any Lender in connection with any
such filing or assignment, delegation and transfer.


 


ARTICLE III 


 


Representations and Warranties


 


Each
of Holdings and the Borrower represents and warrants to the Administrative
Agent, the Collateral Agent and each of the Lenders that:


 


SECTION 3.01.
Organization; Powers.  Holdings, the Borrower and each of the
Subsidiaries (a) is duly organized, validly existing and in good standing
under the laws of the jurisdiction of its organization, (b) has all
requisite power and authority to own its property and assets and to carry on
its business as now conducted and as proposed to be conducted, (c) is
qualified to do business in, and, to the extent such concept is applicable in
such jurisdiction, is in good standing in, every jurisdiction where such
qualification is required, except where the failure so to qualify could not
reasonably be expected to result in a Material Adverse Effect, and (d) has
the power and authority to execute, deliver and perform its obligations under
each of the Loan Documents and each other agreement or instrument contemplated
thereby to which it is or will be a party and, in the case of the Borrower, to
borrow hereunder.


 


38

















 


SECTION 3.02.
Authorization.  The Transactions (a) have been duly
authorized by all requisite corporate and, if required, stockholder action and (b) will
not (i) violate (A) any provision of law, statute, rule or
regulation in a manner that could reasonably be expected to result in a
Material Adverse Effect, or of the certificate or articles of incorporation or
other constitutive documents or by-laws of Holdings, the Borrower or any
Subsidiary, (B) any order of any Governmental Authority in a manner that
could reasonably be expected to result in a Material Adverse Effect, or (C) any
provision of any indenture, agreement or other instrument to which Holdings,
the Borrower or any Subsidiary is a party or by which any of them or any of
their property is or may be bound in a manner that could reasonably be expected
to result in a Material Adverse Effect, (ii) be in conflict with, result
in a breach of or constitute (alone or with notice or lapse of time or both) a
default under, or give rise to any right to accelerate or to require the
prepayment, repurchase or redemption of any obligation under any such
indenture, agreement or other instrument in a manner that could reasonably be
expected to result in a Material Adverse Effect, or (iii) result in the
creation or imposition of any Lien upon or with respect to any property or
assets now owned or hereafter acquired by Holdings, the Borrower or any
Subsidiary (other than any Lien created hereunder or under the Security
Documents or any First Priority Lien).


 


SECTION 3.03.
Enforceability.  This
Agreement has been duly executed and delivered by Holdings and the Borrower and
constitutes, and each other Loan Document when executed and delivered by each
Loan Party party thereto will constitute, a legal, valid and binding obligation
of such Loan Party enforceable against such Loan Party in accordance with its
terms.


 


SECTION 3.04.
Governmental Approvals.  No action, consent or approval of,
registration or filing with or any other action by any Governmental Authority
is or will be required in connection with the Transactions, except for (a) the
filing of Uniform Commercial Code financing statements and filings with the
United States Patent and Trademark Office and the United States Copyright
Office, (b) recordation of the Mortgages, (c) such as have been made
or obtained and are in full force and effect and (d) those that, if not
obtained or made, could not reasonably be expected, individually or in the
aggregate, to have a Material Adverse Effect.


 


SECTION 3.05.
Financial Statements.  (a)
The Borrower has heretofore furnished to the Lenders its consolidated balance sheets
and related statements of income, stockholder’s equity and cash flows: (i) as
of and for the fiscal years ended December 31, 2004, 2005 and 2006,
audited by and accompanied by the opinion of UHY LLP, independent public
accountants, (ii) as of and for the fiscal quarter and the portion of the
fiscal year ended March 31, 2007, certified by a Financial Officer, and (iii) as
of and for each fiscal month ended after March 31, 2007 and at least 30 days
before the Closing Date, certified by a Financial Officer. Such financial
statements present fairly the financial condition and results of operations and
cash flows of the Borrower and its consolidated Subsidiaries as of such dates
and for such periods. Such balance sheets and the notes thereto disclose all
material liabilities, direct or contingent, of the Borrower and its
consolidated Subsidiaries as of the dates thereof. Such financial statements
were prepared in accordance with GAAP applied on a consistent basis, subject,
in the case of


 


39

















 


unaudited financial
statements, to year-end audit adjustments, the absence of footnotes and an
exception for the calculation of taxes and tax accruals.


 


(b)   The Borrower has heretofore delivered to the
Lenders its unaudited pro forma consolidated balance sheet and related pro
forma statements of income, as of March 31, 2007, prepared giving effect
to the Transactions as if they had occurred, with respect to such balance
sheet, on such date and, with respect to such other financial statements, on
the first day of the 12-month period ending on such date. Such pro forma
financial statements have been prepared in good faith by the Borrower, based on
the assumptions used to prepare the pro forma financial information contained
in the Confidential Information Memorandum (which assumptions are believed by
the Borrower on the date hereof and on the Closing Date to be reasonable), are
based on the best information available to the Borrower as of the date of
delivery thereof, accurately reflect all adjustments required to be made to
give effect to the Transactions and present fairly on a pro forma basis the
estimated consolidated financial position of the Borrower and its consolidated
Subsidiaries as of such date and for such period, assuming that the
Transactions had actually occurred at such date or at the beginning of such
period, as the case may be.


 


SECTION 3.06.
No Material Adverse Change.  No event, change or condition has
occurred that has had, or could reasonably be expected to have a material
adverse effect on the business, assets, liabilities, operations, financial
condition or operating results of Holdings, the Borrower and the Subsidiaries,
taken as a whole, since December 31, 2006.


 


SECTION 3.07.
Title to Properties; Possession
Under Leases.  (a) Each
of Holdings, the Borrower and the Subsidiaries has good and marketable title to,
or valid leasehold interests in, all its material properties and assets
(including all Mortgaged Property), except for minor defects in title that do
not interfere in any material respect with its ability to conduct its business
as currently conducted or to utilize such properties and assets for their
intended purposes. All such material properties and assets are free and clear
of Liens, other than Liens expressly permitted by Section 6.02.


 


(b)   Except to the extent that failure to do so could
not reasonably be expected to result in a Material Adverse Effect, (i) each
of Holdings, the Borrower and the Subsidiaries has complied with all obligations
under all leases to which it is a party and all such leases are in full force
and effect and (ii) each of Holdings, the Borrower and the Subsidiaries
enjoys peaceful and undisturbed possession under all such leases.


 


(c)   As of the Closing Date, neither Holdings nor the
Borrower has received any notice of, nor has any knowledge of, any pending or
contemplated condemnation proceeding affecting the Mortgaged Properties or any
sale or disposition thereof in lieu of condemnation.


 


(d)   As of the Closing Date, none of Holdings, the
Borrower or any of the Subsidiaries is obligated under any right of first
refusal, option or other contractual right to sell, assign or otherwise dispose
of any Mortgaged Property or any interest therein.


 


40

















 


SECTION 3.08.
Subsidiaries.  Schedule 3.08 sets forth as of the
Closing Date a list of all Subsidiaries and the percentage ownership interest
of Holdings or the Borrower therein. The shares of capital stock or other
ownership interests so indicated on Schedule 3.08 are fully paid and
non-assessable and are owned by Holdings or the Borrower, directly or
indirectly, free and clear of all Liens (other than Liens created under the
Security Documents or any First Priority Lien).


 


SECTION 3.09.
Litigation; Compliance
with Laws.  (a) Except
as set forth on Schedule 3.09, there are no actions, suits or proceedings at
law or in equity or by or before any Governmental Authority now pending or, to
the knowledge of Holdings or the Borrower, threatened against or affecting
Holdings or the Borrower or any Subsidiary or any business, property or rights
of any such person (i) that involve any Loan Document or the Transactions
or (ii) as to which there is a reasonable possibility of an adverse determination
and that, if adversely determined, could reasonably be expected, individually
or in the aggregate, to result in a Material Adverse Effect.


 


(b)   Since the date of this Agreement, there has been
no change in the status of the matters disclosed on Schedule 3.09 that,
individually or in the aggregate, has resulted in, or materially increased the
likelihood of, a Material Adverse Effect.


 


(c)   None of Holdings, the Borrower or any of the
Subsidiaries or any of their respective material properties or assets is in
violation of, nor will the continued operation of their material properties and
assets as currently conducted violate, any law, rule or regulation
(including any zoning, building, Environmental Law, ordinance, code or approval
or any building permits) or any restrictions of record or agreements affecting
the Mortgaged Property, or is in default with respect to any judgment, writ,
injunction, decree or order of any Governmental Authority, where such violation
or default could reasonably be expected to result in a Material Adverse Effect.


 


(d)   Certificates of occupancy and permits are in
effect for each Mortgaged Property as currently constructed, and true and
complete copies of such certificates of occupancy have been delivered to the
Collateral Agent as mortgagee with respect to each Mortgaged Property.


 


SECTION 3.10.
Agreements.  (a) None of Holdings, the Borrower
or any of the Subsidiaries is a party to any agreement or instrument or subject
to any corporate restriction that has resulted or could reasonably be expected
to result in a Material Adverse Effect.


 


(b)   None of Holdings, the Borrower or any of the
Subsidiaries is in default in any manner under any provision of any indenture
or other agreement or instrument evidencing Indebtedness, or any other material
agreement or instrument to which it is a party or by which it or any of its
properties or assets are or may be bound, where such default could reasonably
be expected to result in a Material Adverse Effect.


 


SECTION 3.11.
Federal Reserve Regulations.  (a) None of Holdings, the Borrower
or any of the Subsidiaries is engaged principally, or as one of its important


 


41

















 


activities, in the
business of extending credit for the purpose of buying or carrying Margin
Stock.


 


(b)   No part of the proceeds of any Loan will be used,
whether directly or indirectly, and whether immediately, incidentally or
ultimately, for any purpose that entails a violation of, or that is
inconsistent with, the provisions of the Regulations of the Board, including
Regulation T, U or X.


 


SECTION 3.12.
Investment Company Act. None of Holdings, the Borrower or any
Subsidiary is an “investment company” as defined in, or subject to regulation
under, the Investment Company Act of 1940.


 


SECTION 3.13.
Use of Proceeds. The Borrower will use the proceeds of
the Loans only for the purposes specified in the introductory statement to this
Agreement.


 


SECTION 3.14.
Tax Returns. Each of Holdings, the Borrower and the
Subsidiaries has filed or caused to be filed all Federal, and all material
state, local and foreign tax returns or materials required to have been filed
by it and has paid or caused to be paid all material taxes due and payable by
it and all assessments received by it, except taxes that are being contested in
good faith by appropriate proceedings and for which Holdings, the Borrower or
such Subsidiary, as applicable, shall have set aside on its books adequate
reserves.


 


SECTION 3.15.
No Material Misstatements. None of (a) the Confidential
Information Memorandum or (b) any other information, report, financial
statement, exhibit or schedule furnished by or on behalf of Holdings or the
Borrower to the Administrative Agent or any Lender in connection with the
negotiation of any Loan Document or included therein or delivered pursuant
thereto contained, contains or will contain any material misstatement of fact
or omitted, omits or will omit to state any material fact necessary to make the
statements therein, in the light of the circumstances under which they were,
are or will be made, not misleading; provided
that to the extent any such information, report, financial statement,
exhibit or schedule was based upon or constitutes a forecast or projection,
each of Holdings and the Borrower represents only that it acted in good faith
and utilized reasonable assumptions (based upon accounting principles
consistent with the historical audited financial statements of the Borrower)
and due care in the preparation of such information, report, financial
statement, exhibit or schedule.


 


SECTION 3.16.
Employee Benefit Plans. (a) Each of the Borrower and its
ERISA Affiliates is in compliance with the applicable provisions of ERISA and
the Code and the regulations and published interpretations thereunder, except
as could not reasonably be expected to have a Material Adverse Effect. No ERISA
Event has occurred or is reasonably expected to occur that, alone or when taken
together with all other such ERISA Events, could reasonably be expected to
result in a Material Adverse Effect. The fair market value of all the assets
under each Plan (based on the assumptions used for purposes of Statement of
Financial Accounting Standards No. 87) was not, as of the last annual
valuation date applicable thereto, less than 80% of the present value of all
benefit


 


42

















 


liabilities under such
Plan, and the fair market value of all assets of all underfunded Plans (based
on the assumptions used for purposes of Statement of Financial Accounting
Standards No. 87) was not, as of the last annual valuation dates
applicable thereto, less than 80% of the present value of all benefit
liabilities of such underfunded Plans.


 


(b)   Each Foreign Pension Plan is in compliance in all
material respects with all requirements of law applicable thereto and the
respective requirements of the governing documents for such plan, except as,
individually or in the aggregate, could not reasonably be expected to result in
a Material Adverse Effect. With respect to each Foreign Pension Plan, none of
Holdings, its Affiliates or any of their respective directors, officers,
employees or agents has engaged in a transaction that could subject Holdings,
the Borrower or any Subsidiary, directly or indirectly, to a tax or civil
penalty that could reasonably be expected, individually or in the aggregate, to
result in a Material Adverse Effect. With respect to each Foreign Pension Plan,
reserves have been established in the financial statements furnished to Lenders
in respect of any unfunded liabilities in accordance with applicable law and
prudent business practice or, where required, in accordance with ordinary
accounting practices in the jurisdiction in which such Foreign Pension Plan is
maintained, except as could not reasonably be expected to have a Material
Adverse Effect. The aggregate unfunded liabilities with respect to such Foreign
Pension Plans could not reasonably be expected to result in a Material Adverse
Effect; the fair market value of the assets of all such Foreign Pension Plans
(based on those assumptions used to fund each such Foreign Pension Plan) was
not, as of the last annual valuation date applicable thereto, less than 80% of
the present value of all the aggregate accumulated benefit liabilities of such
Foreign Pension Plans.


 


SECTION 3.17.
Environmental Matters. (a) Except
as set forth in Schedule 3.17 and except with respect to any other matters
that, individually or in the aggregate, could not reasonably be expected to
result in a Material Adverse Effect, none of Holdings, the Borrower or any of
the Subsidiaries (i) has failed to comply with any Environmental Law or to
obtain, maintain or comply with any permit, license or other approval required
under any Environmental Law, (ii) has become subject to any Environmental
Liability, (iii) has received notice of any claim with respect to any
Environmental Liability or (iv) knows of any basis for any Environmental
Liability.


 


(b)   Since the date of this Agreement, there has been
no change in the status of any matters disclosed on Schedule 3.17 or any new
matters that, individually or in the aggregate, have resulted in, or materially
increased the likelihood of, a Material Adverse Effect.


 


SECTION 3.18. Insurance. Schedule
3.18 sets forth a true, complete and correct description of all insurance
maintained by the Borrower or by the Borrower for its Subsidiaries as of the
date hereof and the Closing Date. As of each such date, such insurance is in
full force and effect and all premiums have been duly paid. The Borrower and
its Subsidiaries have insurance in such amounts and covering such risks and
liabilities as are in accordance with normal industry practice for each
applicable jurisdiction.


 


43














 


SECTION 3.19. Security Documents.  (a) The Guarantee and
Collateral Agreement, upon execution and delivery thereof by the parties
thereto, will create in favor of the Collateral Agent, for the ratable benefit
of the Secured Parties, a legal, valid and enforceable security interest in the
Collateral (as defined in the Guarantee and Collateral Agreement) and the
proceeds thereof and (i) when the Pledged Collateral (as defined in the
Guarantee and Collateral Agreement) is delivered to the collateral agent under
the First Lien Guarantee and Collateral Agreement (who will hold such Pledged
Collateral as bailee for perfection for the Collateral Agent), the Lien  created under Guarantee and Collateral
Agreement shall constitute a fully perfected first priority (subject to the
Intercreditor Agreement) Lien on, and security interest in, all right, title
and interest of the Loan Parties in such Pledged Collateral, in each case prior
and superior in right to any other person other than, pursuant to the terms of
the Intercreditor Agreement, the First Lien Secured Parties (as defined in the
Intercreditor Agreement), and (ii) when financing statements in
appropriate form are filed in the offices specified on Schedule 3.19(a), the
Lien created under the Guarantee and Collateral Agreement will constitute a
fully perfected Lien on, and security interest in, all right, title and
interest of the Loan Parties in such Collateral (other than Intellectual
Property, as defined in the Guarantee and Collateral Agreement), in each case prior
and superior in right to any other person, other than with respect to Liens
expressly permitted by Section 6.02.


 


(b)   Upon the recordation of
the Guarantee and Collateral Agreement (or a short-form security agreement in
form and substance reasonably satisfactory to the Borrower and the Collateral
Agent) with the United States Patent and Trademark Office and the United States
Copyright Office, together with the financing statements in appropriate form
filed in the offices specified on Schedule 3.19(a), Lien created under the
Guarantee and Collateral Agreement shall constitute a fully perfected Lien on,
and security interest in, all right, title and interest of the Loan Parties in
the Intellectual Property (as defined in the Guarantee and Collateral Agreement)
in which a security interest may be perfected by filing in the United States
and its territories and possessions, in each case prior and superior in right
to any other person other than, pursuant to the terms of the Intercreditor
Agreement, the First Lien Secured Parties (as defined in the Intercreditor
Agreement) (it being understood that subsequent recordings in the United States
Patent and Trademark Office and the United States Copyright Office may be
necessary to perfect a Lien on registered trademarks and patents, trademark and
patent applications and registered copyrights acquired by the Loan Parties
after the date hereof).


 


(c)   The Mortgages are
effective to create in favor of the Collateral Agent, for the ratable benefit
of the Secured Parties, a legal, valid and enforceable Lien on all of the Loan
Parties’ right, title and interest in and to the Mortgaged Property thereunder
and the proceeds thereof, and when the Mortgages are filed in the offices
specified on Schedule 3.19(c), the Mortgages shall constitute a fully perfected
Lien on, and security interest in, all right, title and interest of the Loan
Parties in such Mortgaged Property and the proceeds thereof, in each case prior
and superior in right to any other person, other than with respect to the
rights of persons pursuant to Liens expressly permitted by Section 6.02.


 


44

















 


SECTION 3.20. Location of Real Property and Leased
Premises.  (a) Schedule 3.20(a) lists
completely and correctly as of the Closing Date all real property owned by the
Borrower and the Subsidiaries and the addresses thereof. The Borrower and the
Subsidiaries own in fee all the real property set forth on Schedule 3.20(a).


 


(b)   Schedule 3.20(b) lists completely
and correctly as of the Closing Date all real property leased by the Borrower
and the Subsidiaries and the addresses thereof. The Borrower and the
Subsidiaries have valid leases in all the real property set forth on Schedule
3.20(b).


 


SECTION 3.21.
Labor Matters.  As of the date hereof and the
Closing Date, there are no strikes, lockouts or slowdowns against Holdings, the
Borrower or any Subsidiary pending or, to the knowledge of Holdings or the
Borrower, threatened that, individually or in the aggregate, could reasonably
be expected to result in a Material Adverse Effect. Except to the extent that
the same could not reasonably be expected to result in a Material Adverse
Effect, the hours worked by and payments made to employees of Holdings, the
Borrower and the Subsidiaries have not been in violation of the Fair Labor
Standards Act or any other applicable Federal, state, local or foreign law
dealing with such matters.


 


SECTION 3.22.
Solvency.  Immediately after the consummation of the
Transactions to occur on the Closing Date and immediately following the making
of each Loan and after giving effect to the application of the proceeds of each
Loan, (a) the fair value of the assets of the Loan Parties, taken as a
whole, at a fair valuation, will exceed their debts and liabilities,
subordinated, contingent or otherwise; (b) the present fair saleable value
of the property of the Loan Parties, taken as a whole, will be greater than the
amount that will be required to pay the probable liability of their debts and
other liabilities, subordinated, contingent or otherwise, as such debts and
other liabilities become absolute and matured; (c) the Loan Parties, taken
as a whole, will be able to pay their debts and liabilities, subordinated,
contingent or otherwise, as such debts and liabilities become absolute and
matured; and (d) the Loan Parties, taken as a whole, will not have
unreasonably small capital with which to conduct the business in which they are
engaged as such business is now conducted and is proposed to be conducted
following the Closing Date.


 


SECTION 3.23.
Transaction Documents.  Holdings and the Borrower have delivered
to the Administrative Agent a complete and correct copy of the Merger Agreement
(including all schedules, exhibits, amendments, supplements and modifications
thereto). Neither Holdings, the Borrower nor any Loan Party or, to the
knowledge of Holdings or the Borrower, any other person party thereto is in
default in the performance or compliance with any material provisions thereof.


 


SECTION 3.24. Sanctioned
Persons.  None of
Holdings, the Borrower or any Subsidiary nor, to the knowledge of the Borrower,
any director, officer, agent, employee or Affiliate of Holdings, the Borrower
or any Subsidiary is currently subject to any U.S. sanctions administered by
the Office of Foreign Assets Control of the U.S. Treasury


 


45

















 


Department (“OFAC”);  and the
Borrower will not directly or indirectly use the proceeds of the Loans or
otherwise make available such proceeds to any person, for the purpose of
financing the activities of any person, currently subject to any U.S. sanctions
administered by OFAC.


 


ARTICLE IV


 


Conditions of
Lending


 


The obligations of
the Lenders to make Loans hereunder on the Closing Date are subject to the
satisfaction of the following conditions:


 


(a)  The Administrative Agent shall have received a notice of
such Borrowing as required by Section 2.03.


 


(b)  (i) The representations and warranties set forth in
Sections 3.01, 3.02, 3.03, 3.11, 3.12, 3.19 (subject to paragraph (j) below)
and 3.24 shall be true and correct in all material respects on the Closing Date
with the same effect as though made on and as of such date, except to the
extent such representations and warranties expressly relate to an earlier date
and (ii) the condition relating to the accuracy of the representations and
warranties of the Company in the Merger Agreement as are material to the
interests of the Lenders shall have been satisfied.


 


(c)  At the time of and immediately after the making of such
Loans, no Default or Event of Default shall have occurred and be continuing.


 


(d)  The Administrative Agent shall have received, on behalf
of itself and the Lenders, a written opinion of (i) Weil,
Gotshal & Manges LLP, counsel for Holdings and the Borrower,
substantially to the effect set forth in Exhibit F-1 and (ii) Murtha
Cullina LLP, substantially to the effect set forth in Exhibit F-2, in each
case (A) dated the Closing Date, (B) addressed to the Administrative
Agent and the Lenders, and (C) covering such other matters relating to the
Loan Documents and the Transactions as the Administrative Agent shall
reasonably request, and Holdings and the Borrower hereby request such counsel
to deliver such opinions.


 


(e)  The Administrative Agent shall have
received (i) a copy of the certificate or articles of incorporation (or
other similar formation document), including all amendments thereto, of each
Loan Party, certified as of a recent date by the Secretary of State (or
equivalent) of the state of its organization, and a certificate of legal
existence and, if available in such jurisdiction, certificate as to the good
standing of each Loan Party as of a recent date, from such Secretary of State;
(ii) a certificate of the Secretary or Assistant Secretary of each Loan
Party dated the Closing Date and certifying (A) that attached thereto is a
true and complete copy of the by-laws (or equivalent) of such Loan Party as in
effect on the Closing Date and at all times since a date prior to the date of the
resolutions described in clause (B) below, (B) that attached thereto
is a true and complete copy of resolutions (or equivalent) duly adopted by the
Board of Directors of such Loan Party authorizing the execution, delivery and
performance of the Loan Documents to


 


46

















 


which such person is a
party and, in the case of the Borrower, the borrowings hereunder, and that such
resolutions have not been modified, rescinded or amended and are in full force
and effect, (C) that the certificate or articles of incorporation of such
Loan Party have not been amended since the date of the last amendment thereto
shown on the certificate of legal existence or good standing (or equivalent) or
state certified copies of such documents furnished pursuant to clause
(i) above, and (D) as to the incumbency and specimen signature of
each officer executing any Loan Document or any other document delivered in
connection herewith on behalf of such Loan Party; and (iii) a certificate
of another officer as to the incumbency and specimen signature of the Secretary
or Assistant Secretary executing the certificate pursuant to clause
(ii) above.


 


(f)  The
Administrative Agent shall have received a certificate, dated the Closing Date
and signed by a Responsible Officer of the Borrower, confirming compliance with
the conditions precedent set forth in paragraph (b) of this
Article IV as of the Closing Date.


 


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


 


(h)  The
Security Documents shall have been duly executed by each Loan Party that is to
be a party thereto and shall be in full force and effect on the Closing Date.
The Collateral Agent on behalf of the Secured Parties shall have been granted a
security interest in the Collateral of the type and priority described in each
Security Document.


 


(i)  The
Collateral Agent shall have received a Perfection Certificate with respect to
the Loan Parties dated the Closing Date and duly executed by a Responsible
Officer of Holdings and the Borrower, and shall have received the results of a
search of the Uniform Commercial Code filings (or equivalent filings) made with
respect to the Loan Parties in the states (or other jurisdictions) of formation
of such persons, in which the chief executive office of each such person is
located and in the other jurisdictions in which such persons maintain property,
in each case as indicated on such Perfection Certificate, together with copies
of the financing statements (or similar documents) disclosed by such search,
and accompanied by evidence satisfactory to the Collateral Agent that the Liens
indicated in any such financing statement (or similar document) would be
permitted under Section 6.02 or have been or will be contemporaneously released
or terminated.


 


(j)  Except as otherwise specifically
contemplated hereunder or by the Security Documents, (i) each of the
Security Documents, in form and substance satisfactory to the Lenders, relating
to each of the Mortgaged Properties shall have been duly executed by the
parties thereto and delivered to the Collateral Agent and shall be in full
force and effect, (ii) each of such Mortgaged Properties shall not be
subject to any Lien other than those permitted under Section 6.02 or Liens
which shall be paid from the proceeds of the First Credit Event and for which
the Borrower has received a commitment from the holder thereof to release the
same upon payoff from the proceeds of the First Credit Event and
(iii) each of such Security Documents shall be in proper form for filing
and


 


47

















 


recording in the
recording office as specified on Schedule 3.19(c); provided that to the extent a perfected security interest in
any assets of a type that cannot be perfected by the filing of a UCC financing
statement or the delivery of stock certificates is not able to be provided on
the Closing Date after the Borrower’s use of commercially reasonable efforts to
do so, the providing of a perfected security interest in such assets shall not
constitute a condition precedent to the Borrowing on the Closing Date but such
requirement to create a perfected security interest in such assets shall be
satisfied after the Closing Date pursuant to Section 5.13.


 


(k)  The
Administrative Agent shall have received a  copy
of, or a certificate as to coverage under, the insurance policies required by
Section 5.02 and the applicable provisions of the Security Documents, each
of which shall be endorsed or otherwise amended to include a customary lender’s
loss payable endorsement and to name the Collateral Agent as additional
insured, in form and substance satisfactory to the Administrative Agent.


 


(l)  The
Acquisition and the other Transactions shall be consummated substantially
simultaneously with the initial funding of Loans on the Closing Date in
accordance with applicable law and on the terms in this Agreement and in the
Merger Agreement (without any amendment, modification or waiver thereof that is
materially adverse to the Lenders (as reasonably determined by the
Administrative Agent) without the prior written consent of the Administrative
Agent). The Administrative Agent shall have received copies of the Merger
Agreement and all certificates, opinions and other documents delivered
thereunder, certified by a Financial Officer as being complete and correct.


 


(m)  The
Equity Contribution shall have been made and the Administrative Agent shall be
satisfied with the capitalization and structure of Holdings and the Borrower.


 


(n)  All
principal, premium, if any, interest, fees and other amounts due or outstanding
under the Existing Debt shall have been, or substantially simultaneously with
the initial funding of Loans on the Closing Date shall be, paid in full, the
commitments thereunder terminated and all guarantees and security in support
thereof discharged and released, and the Administrative Agent shall have
received reasonably satisfactory evidence thereof. Immediately after giving
effect to the Transactions and the other transactions contemplated hereby,
Holdings, the Borrower and the Subsidiaries shall have outstanding no
Indebtedness or preferred stock other than (a) Indebtedness outstanding
under this Agreement, (b) the First Lien Loans, (c) Indebtedness set
forth on Schedule 6.01 and (d) other Indebtedness in an outstanding
principal amount not to exceed $100,000 in the aggregate.


 


(o)  The Administrative Agent shall have
received a certificate from the chief financial 
officer  of Holdings  certifying 
that  Holdings  and 
its  subsidiaries,  on  a
consolidated basis after giving effect to the Transactions to occur on the
Closing Date, are solvent.


 


48

















 


(p)  The
Lenders shall have received, to the extent reasonably requested, at least five
Business Days prior to the Closing Date, all documentation and other
information required by regulatory authorities under applicable “know your
customer” and anti-money laundering rules and regulations, including the
USA PATRIOT Act.


 


(q)  The
Administrative Agent shall have received a certificate, dated the Closing Date
and signed by a Responsible Officer of the Company, certifying that not less
than $10,000,000 in aggregate cash liquidity is in bank accounts in
jurisdictions appropriate for carrying out the Company’s operational objectives
(which, for greater certainty, shall not include financing in whole or in part
any Permitted Acquisition), including planned Capital Expenditures, during the
period from the Closing Date to the first anniversary of the Closing Date.


 


The Borrowing of
the Loans on the Closing Date shall be deemed to constitute a representation
and warranty by the Borrower and Holdings on such date as to the matters
specified in paragraphs (b) of this Article IV.


 


ARTICLE V


 


Affirmative
Covenants


 


Each of Holdings
and the Borrower covenants and agrees with each Lender that so long as this
Agreement shall remain in effect and until the Commitments have been terminated
and the principal of and interest on each Loan, all fees and all other expenses
or amounts payable under any Loan Document shall have been paid in full, unless
the Required Lenders shall otherwise consent in writing, each of Holdings and
the Borrower will, and will cause each of the Subsidiaries to:


 


SECTION 5.01.
Existence; Compliance with
Laws; Businesses and Properties.  (a)  Do or
cause to be done all things necessary to preserve, renew and keep in full force
and effect its legal existence, except as otherwise expressly permitted under
Section 6.05.


 


(b)   Do
or cause to be done all things necessary to obtain, preserve, renew, extend and
keep in full force and effect the rights, licenses, permits, franchises,
authorizations, patents, copyrights, trademarks and trade names material to the
conduct of its business; maintain and operate such business in substantially
the manner in which it is presently conducted and operated; comply in all
material respects with all applicable laws, rules, regulations and decrees and
orders of any Governmental Authority, whether now in effect or hereafter enacted;
and at all times maintain and preserve all property material to the conduct of
such business and keep such property in good repair, working order and
condition and from time to time make, or cause to be made, all needful and
proper repairs, renewals, additions, improvements and replacements thereto
necessary in order that the business carried on in connection therewith may be
properly conducted at all times.


 


SECTION 5.02. Insurance.
(a)  Keep its  insurable properties adequately insured at all
times by financially sound and reputable insurers; maintain such other
insurance, to


 


49

















 


such
extent and against such risks, including fire and other risks insured against
by extended coverage, as is customary with companies in the same or similar
businesses operating in the same or similar locations or jurisdictions,
including, where applicable, public liability insurance against claims for
personal injury or death or property damage occurring upon, in, about or in
connection with the use of any properties owned, occupied or controlled by it;
and maintain such other insurance as may be required by applicable law.


 


(b)   Cause all such policies
covering any Collateral to be endorsed or otherwise amended to include a
customary lender’s loss payable endorsement, in form and substance satisfactory
to the Administrative Agent and the Collateral Agent, which endorsement
(subject to the Intercreditor Agreement) shall provide that, from and after the
Closing Date, if the insurance carrier shall have received written notice from
the Administrative Agent or the Collateral Agent of the occurrence of an Event
of Default, the insurance carrier shall pay all proceeds otherwise payable to
the Borrower or the Loan Parties under such policies directly to the Collateral
Agent; cause all such policies to provide that neither the Borrower, the
Administrative Agent, the Collateral Agent nor any other party shall be a
coinsurer thereunder and to contain a “Replacement Cost Endorsement”, without
any deduction for depreciation, and such other provisions as the Administrative
Agent or the Collateral Agent may reasonably require from time to time to
protect their interests; deliver evidence reasonably satisfactory to the
Collateral Agent of all such policies; cause each such policy to provide that
it shall not be canceled or not renewed (i) by reason of nonpayment of
premium upon not less than 10 days’ prior written notice thereof by the insurer
to the Administrative Agent and the Collateral Agent (giving the Administrative
Agent and the Collateral Agent the right to cure defaults in the payment of
premiums) or (ii) for any other reason upon not less than 30 days’ prior
written notice thereof by the insurer to the Administrative Agent and the Collateral
Agent; deliver evidence reasonably satisfactory to the Administrative Agent and
the Collateral Agent, prior to the cancellation or nonrenewal of any such
policy of insurance, of renewal of a policy previously delivered to the
Administrative Agent and the Collateral Agent, together with evidence
reasonably satisfactory to the Administrative Agent and the Collateral Agent of
payment of the premium therefor.


 


(c)   If at any time the area
in which the Premises (as defined in the Mortgages) are located is designated
(i) a “flood hazard area” in any Flood Insurance Rate Map published by the
Federal Emergency Management Agency (or any successor agency), obtain flood
insurance in such total amount as the Administrative Agent, the Collateral
Agent or the Required Lenders may from time to time reasonably require, and
otherwise comply with the National Flood Insurance Program as set forth in the
Flood Disaster Protection Act of 1973, as it may be amended from time to time,
or (ii) a “Zone 1” area, obtain earthquake insurance in such total amount
as the Administrative Agent, the Collateral Agent or the Required Lenders may
from time to time reasonably require.


 


(d)   With
respect to any Mortgaged Property, carry and maintain comprehensive general
liability insurance including the “broad form CGL endorsement” or its
equivalent and coverage on an occurrence basis against claims made for personal
injury (including bodily injury, death and property damage) and umbrella
liability insurance against any


 


50

















 


and
all causes of loss, in no event for a combined single limit of less than $10,000,000
naming the Collateral Agent as an additional insured (subject to the
Intercreditor Agreement), on forms satisfactory to the Collateral Agent.


 


(e)   Notify the Administrative Agent and the Collateral
Agent promptly whenever any separate insurance concurrent in form or
contributing in the event of loss with that required to be maintained under
this Section 5.02 is taken out by any Loan Party; and promptly deliver
evidence reasonably satisfactory to the Administrative Agent and the Collateral
Agent of such policy or policies.


 


SECTION 5.03. Obligations
and Taxes.  Pay
its Indebtedness and other material obligations promptly and in accordance with
their terms and pay and discharge all material taxes, assessments and
governmental charges or levies imposed upon it or upon its income or profits or
in respect of its property, before the same shall become delinquent or in
default, as well as all lawful claims for labor, materials and supplies or
otherwise that, if unpaid, might give rise to a Lien upon such properties or
any part thereof; provided, however, that
such payment and discharge shall not be required with respect to any such tax,
assessment, charge, levy or claim so long as the validity or amount thereof
shall be contested in good faith by appropriate proceedings and the Borrower
shall have set aside on its books adequate reserves with respect thereto in
accordance with GAAP


 


SECTION 5.04. Financial
Statements, Reports, etc.  In
the case of the Borrower, furnish to the Administrative Agent, which shall
furnish to each Lender:


 


(a)   within 120 days after
the end of each fiscal year, its consolidated balance sheet and related
statements of income, stockholders’ equity and cash flows showing the financial
condition of the Borrower and its consolidated Subsidiaries as of the close of
such fiscal year and the results of its operations and the operations of such
Subsidiaries during such year, together with comparative figures for the
immediately preceding fiscal year, all audited by UHY LLP or other independent
public accountants of recognized national standing and accompanied by an
opinion of such accountants (which opinion shall be without a “going concern”
or like qualification or exception and without any qualification or exception
as to the scope of such audit) to the effect that such consolidated financial
statements fairly present the financial condition and results of operations of
the Borrower and its consolidated Subsidiaries on a consolidated basis in
accordance with GAAP consistently applied;


 


(b)   within
45 days after the end of each of the first three fiscal quarters of each fiscal
year, its consolidated balance sheet and related statements of income,
stockholders’ equity and cash flows showing the financial condition of the
Borrower and its consolidated Subsidiaries as of the close of such fiscal
quarter and the results of its operations and the operations of such
Subsidiaries during such fiscal quarter and the then elapsed portion of the
fiscal year, and comparative figures for the same periods in the immediately
preceding fiscal year, all certified by one of its Financial Officers as fairly
presenting the financial condition and results of operations of the Borrower
and its consolidated Subsidiaries on a consolidated basis in accordance with
GAAP consistently applied, subject to normal year-end audit adjustments and the
absence of footnotes;


 


51

















 


(c)   concurrently with any delivery of financial
statements under paragraph (a) or (b) above, a certificate of the
accounting firm (in the case of paragraph (a)) or Financial Officer (in the
case of paragraph (b)) opining on or certifying such statements (which
certificate, when furnished by an accounting firm, may be limited to accounting
matters and disclaim responsibility for legal interpretations)
(i) certifying that no Event of Default or Default has occurred or, if
such an Event of Default or Default has occurred, specifying the nature and
extent thereof and any corrective action taken or proposed to be taken with
respect thereto and (ii) setting forth computations in reasonable detail
satisfactory to the Administrative Agent demonstrating compliance with the
covenants contained in Sections 6.10 and 6.11 and, in the case of a certificate
delivered with the financial statements required by paragraph (a) above,
setting forth the Borrower’s calculation of Excess Cash Flow;


 


(d)   within 90 days after the beginning of each fiscal
year of the Borrower, a detailed consolidated budget for such fiscal year
(including a projected consolidated balance sheet and related statements of
projected operations and cash flows as of the end of and for such fiscal year
and setting forth the assumptions used for purposes of preparing such budget)
and, promptly when available, any significant revisions of such budget;


 


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


 


(f)   promptly after the receipt thereof by Holdings or
the Borrower or any of their respective subsidiaries, a copy of any “management
letter” received by any such person from its certified public accountants and
the management’s response thereto;


 


(g)   promptly after the request by any Lender, all
documentation and other information that such Lender reasonably requests in
order to comply with its ongoing obligations under applicable “know your
customer” and anti-money laundering rules and regulations, including the
USA PATRIOT Act;


 


(h)   promptly
after the request by the Administrative Agent or any Lender, on and after the
effectiveness of the applicable provisions of the Pension Act, copies of
(i) any documents described in Section 101(k)(l) of ERISA that
the Borrower or any of its ERISA Affiliates may request with respect to any
Multiemployer Plan and (ii) any notices described in
Section 101(1)(1) of ERISA that the Borrower or any of its ERISA
Affiliates may request with respect to any Multiemployer Plan; provided that if the Borrower or any of
its ERISA Affiliates has not requested such documents or notices from the
administrator or sponsor of the applicable Multiemployer Plan, the Borrower or
the applicable ERISA Affiliate shall promptly make a request for such documents
or notices from such administrator or sponsor and shall provide copies of such
documents and notices promptly after receipt thereof; and


 


52

















 


(i)   promptly,
from time to time, such other information regarding the operations, business
affairs and financial condition of Holdings, the Borrower or any Subsidiary, or
compliance with the terms of any Loan Document, as the Administrative Agent or
any Lender may reasonably request.


 


Documents required to be
delivered pursuant to Section 5.04(e) may be delivered electronically
and if so delivered, shall be deemed to have been delivered on the date (i) on
which the Borrower posts such documents, or provides a link thereto at
http://www.strlab.com/www/strlab/; or (ii) on which such documents are
posted on the Borrower’s behalf on an Internet or intranet website, if any, to
which each Lender and the Administrative Agent have access (whether a
commercial, third-party website or sponsored by the Administrative Agent); provided that: (x) the Borrower shall
deliver paper copies of such documents to the Administrative Agent if it so
requests or to any Lender that so requests the Borrower to deliver such paper
copies and (y) the Borrower shall notify the Administrative Agent and each
Lender of the posting of any such documents and provide to the Administrative
Agent by electronic mail electronic versions (i.e., soft copies) of such documents.


 


SECTION 5.05.
Litigation and Other Notices.  Furnish to the Administrative Agent and
each Lender prompt written notice of the following:


 


(a)   any
Event of Default or Default, specifying the nature and extent thereof and the
corrective action (if any) taken or proposed to be taken with respect thereto;


 


(b)   the
filing or commencement of, or any written threat or written notice of intention
of any person to file or commence, any action, suit or proceeding, whether at
law or in equity or by or before any Governmental Authority, against the
Borrower or any Affiliate thereof that could reasonably be expected to result
in a Material Adverse Effect;


 


(c)   the occurrence of any ERISA Event that, alone or
together with any other ERISA Events that have occurred, could reasonably be
expected to result in a Material Adverse Effect;


 


(d)   any development that has resulted in, or could
reasonably be expected to result in a Material Adverse Effect; and


 


(e)   any change in the Borrower’s corporate rating by
S&P, in the Borrower’s corporate family rating by Moody’s or in the ratings
of the Credit Facility by S&P or Moody’s, or any notice from either such
agency indicating its intent to effect such a change or to place the Borrower
or the Credit Facility on a “CreditWatch” or “WatchList” or any similar list,
in each case with negative implications, or its cessation of, or its intent to
cease, rating the Borrower or the Credit Facility.


 


SECTION 5.06.
Information Regarding
Collateral.  (a) Furnish
to the Administrative Agent prompt written notice of any change (i) in any
Loan Party’s corporate name, (ii) in the jurisdiction of organization or
formation of any Loan Party, (iii) in any Loan Party’s identity or
corporate structure or (iv) in any Loan Party’s Federal


 


53

















 


Taxpayer Identification
Number. Holdings and the Borrower agree not to effect or permit any change
referred to in the preceding sentence unless all filings have been made under
the Uniform Commercial Code or otherwise that are reasonably required in order
for the Collateral Agent to continue at all times following such change to have
a valid, legal and perfected security interest in all the Collateral. Holdings
and the Borrower also agree promptly to notify the Administrative Agent if any
material portion of the Collateral is damaged or destroyed.


 


(b)   In
the case of the Borrower, each year, at the time of delivery of the annual
financial statements with respect to the preceding fiscal year pursuant to
Section 5.04(a), deliver to the Administrative Agent a certificate of a
Financial Officer (i) setting forth the information required pursuant to
Section 2 of the Perfection Certificate or confirming that there has been
no change in such information since the date of the Perfection Certificate
delivered on the Closing Date or the date of the most recent certificate
delivered pursuant to this Section 5.06 and (ii) to the extent
applicable, certifying that all Uniform Commercial Code financing statements (including
fixture filings, as applicable) or other appropriate filings recordings or
registrations, including all refilings, recordings and registrations,
containing a description of the Article 9 Collateral (as defined in the
Guarantee and Collateral Agreement) have been filed of record in each
governmental, municipal or other appropriate office in each jurisdiction
identified pursuant to clause (i) of this Section 5.06(b) to the
extent necessary to protect and perfect the security interest for a period of
not less than 18 months after the date of such certificate (except as noted
therein with respect to any continuation statements to be filed within such
period). Each certificate delivered pursuant to this
Section 5.06(b)(ii) shall identify in the format of Section 13
of the Perfection Certificate all Intellectual Property of any Loan Party in
existence on the date thereof and not then listed on the Perfection Certificate
or previously so identified to the Collateral Agent.


 


SECTION 5.07.
Maintaining Records; Access to
Properties and Inspections; Maintenance of Ratings.  (a) Keep proper books of record and
account in which full, true and correct entries in conformity with GAAP and all
requirements of law are made of all dealings and transactions in relation to
its business and activities. Each Loan Party will, and will cause each of its
subsidiaries to, permit any representatives designated by the Administrative
Agent or any Lender to visit and inspect the financial records and the
properties of such person at reasonable times and as often as reasonably
requested and to make extracts from and copies of such financial records, and
permit any representatives designated by the Administrative Agent or any Lender
to discuss the affairs, finances and condition of such person with the officers
thereof and independent accountants therefor; provided
that as long as no Default or Event of Default shall have occurred
and shall be continuing, no more than one such site inspection may be conducted
in any calendar year (which shall be conducted by representatives designated by
the Administrative Agent).


 


(b)   In the case of Holdings and the
Borrower, use commercially reasonable efforts to cause the Credit Facility to
be continuously rated by S&P and Moody’s, and in the case of the Borrower,
use commercially reasonable efforts to maintain a corporate rating from S&P
and a corporate family rating from Moody’s, in each case in respect of the
Borrower.


 


54














 


SECTION 5.08.
Use of Proceeds.  Use the proceeds of the Loans only for
the purposes specified in the introductory statement to this Agreement.


 


SECTION 5.09.
Employee Benefits.  (a) With respect to any Plan or
Foreign Pension Plan sponsored or maintained by Borrower or any Subsidiary,
comply in all material respects with the applicable provisions of ERISA and the
Code and the laws applicable to any Foreign Pension Plan and (b) furnish
to the Administrative Agent as soon as possible after, and in any event within
ten days after any responsible officer of Holdings, the Borrower or any ERISA
Affiliate knows or has reason to know that, any ERISA Event has occurred that,
alone or together with any other ERISA Event could reasonably be expected to
result in a Material Adverse Effect, a statement of a Financial Officer of
Holdings or the Borrower setting forth details as to such ERISA Event and the
action, if any, that Holdings or the Borrower proposes to take with respect
thereto.


 


SECTION 5.10.
Compliance with Environmental
Laws.  Comply, and
use commercially reasonable efforts to cause all lessees and other persons
occupying its properties to comply, in all respects with all Environmental Laws
applicable to its operations and properties; obtain and renew all environmental
permits necessary for its operations and properties; and conduct any remedial
action in accordance with Environmental Laws, except where the failure to
comply therewith, either individually or in the aggregate, could not reasonably
be expected to have a Material Adverse Effect; provided,
however, that none of Holdings, the Borrower or any Subsidiary shall
be required to undertake any remedial action required by Environmental Laws to
the extent that its obligation to do so is being contested in good faith and by
proper proceedings and appropriate reserves are being maintained with respect
to such circumstances in accordance with GAAP.


 


SECTION 5.11.
Further Assurances.  Execute any and all further documents,
financing statements, agreements and instruments, and take all further action
(including filing Uniform Commercial Code and other financing statements,
mortgages and deeds of trust) that may be required under applicable law, or
that the Required Lenders, the Administrative Agent or the Collateral Agent may
reasonably request, in order to effectuate the transactions contemplated by the
Loan Documents and in order to grant, preserve, protect and perfect the
validity and first priority (subject to the Intercreditor Agreement) of the
security interests created or intended to be created by the Security Documents.
The Borrower will cause any subsequently acquired or organized Domestic
Subsidiary to become a Loan Party by executing the Guarantee and Collateral
Agreement and each applicable Security Document in favor of the Collateral
Agent. In addition, from time to time, the Borrower will, at its cost and
expense, promptly secure the Obligations by pledging or creating, or causing to
be pledged or created, perfected security interests with respect to such of its
assets and properties as the Administrative Agent or the Required Lenders shall
designate (it being understood that it is the intent of the parties that the
Obligations shall be secured by substantially all the assets of the Borrower
and its Domestic Subsidiaries (including real and other properties acquired
subsequent to the Closing Date)). Such security interests and Liens will be
created under the Security Documents and other security agreements, mortgages,
deeds of trust, leasehold mortgages, assignments of leases and rents,
modifications and other


 


55

















 


instruments and documents
in form and substance satisfactory to the Collateral Agent, and the Borrower
shall deliver or cause to be delivered to the Lenders all such instruments and
documents (including lien searches, surveys, abstracts, appraisals, legal
opinions and a policy or policies of title insurance issued by a nationally
recognized title insurance company, together with such endorsements, coinsurance
and reinsurance as may be requested by the Collateral Agent and the Lenders,
insuring the Mortgages as valid first liens, free of Liens other than those
permitted under Section 6.02) as the Collateral Agent shall reasonably
request to evidence compliance with this Section. The Borrower agrees to
provide such evidence as the Collateral Agent shall reasonably request as to
the perfection and priority status of each such security interest and Lien. In
furtherance of the foregoing, the Borrower will give prompt notice to the
Administrative Agent of the acquisition by it or any of the Subsidiaries of any
real property (or any interest in real property) having a value in excess of
$1,000,000.


 


SECTION 5.12.
Interest Rate Protection.  No later than the 90th day after the
Closing Date, the Borrower shall enter into, and for a minimum of three years
thereafter maintain, Hedging Agreements acceptable to the Administrative Agent
that result in at least 50% of the aggregate principal amount of its funded
long-term Indebtedness being effectively subject to a fixed or maximum interest
rate acceptable to the Administrative Agent.


 


SECTION 5.13.
Post-Closing Items.  Holdings and the Borrower shall, and
shall cause each of the Subsidiaries to, take all necessary actions to satisfy
the requirements set forth on Schedule 5.13 within the period specified on such
schedule (or such longer period as may be consented to by the Administrative
Agent).


 


SECTION 5.14.
Funds Update.  The Borrower shall, with respect to each
of the first four fiscal quarters ending after the Closing Date, provide the
Administrative Agent with reasonably detailed information about the uses of the
$10,000,000 described in paragraph (q) of Article IV, all of which
such uses to be consistent with those contemplated by paragraph (q) of Article IV.


 


SECTION 5.15.
Purchase Price Adjustments.  Holdings and the Borrower shall, take all
actions reasonably necessary to ensure that all purchase price adjustments
related to the Transactions payable by the sellers shall be paid to the
Borrower.


 


ARTICLE VI


 


Negative
Covenants


 


Each of Holdings
and the Borrower covenants and agrees with each Lender that, so long as this
Agreement shall remain in effect and until the Commitments have been terminated
and the principal of and interest on each Loan, all fees and all other expenses
or amounts payable under any Loan Document have been paid in full, unless the
Required Lenders shall otherwise consent in writing, neither Holdings nor the
Borrower will, nor will they cause or permit any of the Subsidiaries to:


 


56

















 


SECTION 6.01.
Indebtedness.  Incur, create, assume or permit to exist
any Indebtedness, except:


 


(a)   Indebtedness existing on the date hereof and set
forth in Schedule 6.01 and any extensions, renewals or replacements of such
Indebtedness to the extent the principal amount of such Indebtedness is not
increased, neither the final maturity nor the weighted average life to maturity
of such Indebtedness is decreased, such Indebtedness, if subordinated to the
Obligations, remains so subordinated on terms no less favorable to the Lenders,
and the original obligors in respect of such Indebtedness remain the only
obligors thereon;


 


(b)   Indebtedness created hereunder and under the other
Loan Documents;


 


(c)   intercompany Indebtedness of the Borrower and the
Subsidiaries to the extent permitted by Section 6.04(c);


 


(d)   Indebtedness of the Borrower or any Subsidiary
incurred to finance the acquisition, construction or improvement of any fixed
or capital assets, and extensions, renewals and replacements of any such
Indebtedness that do not increase the outstanding principal amount thereof; provided that (i) such Indebtedness
is incurred prior to or within 90 days after such acquisition or the completion
of such construction or improvement and (ii) the aggregate principal
amount of Indebtedness permitted by this Section 6.01(d), when combined
with the aggregate principal amount of all Capital Lease Obligations and
Synthetic Lease Obligations incurred pursuant to Section 6.01(e), shall
not exceed $10,000,000 at any time outstanding;


 


(e)   Capital Lease Obligations and Synthetic Lease
Obligations in an aggregate principal amount, when combined with the aggregate
principal amount of all Indebtedness incurred pursuant to Section 6.01(d), not
in excess of $10,000,000 at any time outstanding;


 


(f)   Attributable Debt in respect of Sale/Leaseback
Transactions; provided, however, that
the aggregate principal amount of all Indebtedness then outstanding and
incurred pursuant to this clause (f) does not exceed (i) $6,000,000
in respect of property owned by the Borrower or any Subsidiary on the Closing
Date or (ii) $6,000,000 in respect of any property acquired by the
Borrower or any Subsidiary after the Closing Date;


 


(g)   Indebtedness under performance bonds or with
respect to workers’ compensation claims, in each case incurred in the ordinary
course of business;


 


(h)   Indebtedness incurred by Foreign Subsidiaries in
an aggregate principal amount not exceeding $12,000,000 at any time
outstanding;


 


(i)   Indebtedness under the First Lien Credit Agreement
and any refinancings thereof in an aggregate principal amount at any time
outstanding not


 


57

















 


to exceed the Cap
Amount as permitted under and as defined in the Intercreditor Agreement;


 


(j)   Indebtedness under the Spanish Subsidized Loans in
an aggregate principal amount not exceeding $5,000,000 at any time outstanding;
and


 


(k)   other unsecured Indebtedness of the Borrower or
the Subsidiaries in an aggregate principal amount not exceeding $6,000,000 at
any time outstanding.


 


SECTION 6.02.
Liens.  Create, incur, assume or permit to exist
any Lien on any property or assets (including Equity Interests or other
securities of any person, including the Borrower or any Subsidiary) now owned
or hereafter acquired by it or on any income or revenues or rights in respect
of any thereof, except:


 


(a)   Liens on property or assets of the Borrower and
its Subsidiaries existing on the date hereof and set forth in Schedule 6.02; provided that such Liens shall secure only
those obligations which they secure on the date hereof and extensions, renewals
and replacements thereof permitted hereunder;


 


(b)   any Lien created under the Loan Documents;


 


(c)   any First Priority Liens;


 


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


 


(e)   Liens for taxes not yet due or which are being
contested in compliance with Section 5.03 or are immaterial in amount;


 


(f)   carriers’, warehousemen’s, mechanics’, materialmen’s,
repairmen’s or other like Liens arising in the ordinary course of business and
securing obligations that are not due and payable or which are being contested
in compliance with Section 5.03;


 


(g)   pledges and deposits made in the ordinary course
of business in compliance with workmen’s compensation, unemployment insurance
and other social security laws or regulations;


 


(h)   deposits to secure the performance of bids, trade
contracts (other than for Indebtedness), leases (other than Capital Lease Obligations),
statutory


 


58

















 


obligations,
surety and appeal bonds, performance bonds and other obligations of a like
nature incurred in the ordinary course of business;


 


(i)   zoning restrictions, easements, rights-of-way,
restrictions on use of real property and other similar encumbrances incurred in
the ordinary course of business which, in the aggregate, are not substantial in
amount and do not materially detract from the value of the property subject
thereto or interfere with the ordinary conduct of the business of the Borrower
or any of its Subsidiaries;


 


(j)   purchase money security interests in real
property, improvements thereto or equipment hereafter acquired (or, in the case
of improvements, constructed) by the Borrower or any Subsidiary; provided that (i) such security
interests secure Indebtedness permitted by Section 6.01, (ii) such
security interests are incurred, and the Indebtedness secured thereby is
created, within 90 days after such acquisition (or construction), (iii) the
Indebtedness secured thereby does not exceed 100% of the lesser of the cost or
the fair market value of such real property, improvements or equipment at the
time of such acquisition (or construction) and (iv) such security
interests do not apply to any other property or assets of the Borrower or any
Subsidiary;


 


(k)   Liens arising out of judgments or awards in
respect of which Holdings, the Borrower or any of the Subsidiaries shall in
good faith be prosecuting an appeal or proceedings for review in respect of
which there shall be secured a subsisting stay of execution pending such appeal
or proceedings; provided that the
aggregate amount of all such judgments or awards (and any cash and the fair
market value of any property subject to such Liens) does not exceed $6,000,000
at any time outstanding;


 


(l)   any Lien securing Indebtedness incurred by the
Borrower or any Subsidiary pursuant to Section 6.01(f); provided that any such Liens attach only
to the property that is the subject of, and proceeds thereof in connection
with, the applicable Sale/Leaseback Transaction and shall not attach to any
other property of the Borrower or any Subsidiary theretofore existing or
(except for any such proceeds) which arises after the date thereof;


 


(m)   Liens on assets of Foreign Subsidiaries; provided that (i) such Liens do not
extend to, or encumber, assets that constitute Collateral or the Equity
Interests of the Borrower or any of the Subsidiaries, and (ii) such Liens
extending to the assets of any Foreign Subsidiary secure only Indebtedness
incurred by such Foreign Subsidiary pursuant to Section 6.01(h); and


 


(n)   other Liens that do not, individually or in the
aggregate, secure obligations (or encumber property with a fair market value)
in excess of $3,000,000 at any one time.


 


SECTION 6.03.
Sale/LeaseBack Transactions.  Enter into any Sale/Leaseback
Transaction unless (a) the sale or transfer of such property is permitted
by Section 6.05


 


59

















 


and (b) any Capital
Lease Obligations, Synthetic Lease Obligations or Liens arising in connection
therewith are permitted by Sections 6.01 and 6.02, as the case may be.


 


SECTION 6.04.
Investments, Loans and Advances.  Purchase, hold or acquire any Equity
Interests, evidences of indebtedness or other securities of, make or permit to
exist any loans or advances to, or make or permit to exist any investment or
any other interest in, any other person, except:


 


(a) (i)   investments by Holdings, the Borrower and
the Subsidiaries existing on the date hereof in the Equity Interests of the
Borrower and the Subsidiaries, (ii) additional investments by Holdings,
the Borrower and the Subsidiaries in the Equity Interests of the Borrower and
the Subsidiaries and (iii) investments in STR India Pvt. Ltd. in an amount
not to exceed $5,000,000 in the aggregate; provided
that (A) any such Equity Interests held by a Loan Party other
than Equity Interests in Excluded Assets (as defined in the Guarantee and
Collateral Agreement) shall be pledged pursuant to the Guarantee and Collateral
Agreement (subject to the limitations applicable to voting stock of a Foreign
Subsidiary referred to therein) and (B) the aggregate amount of
investments made after the Closing Date (other than pursuant to clause (iii) above)
by Loan Parties in, and loans and advances made after the Closing Date by Loan
Parties to, Subsidiaries that are not Loan Parties (determined without regard
to any write-downs or write-offs of such investments, loans and advances) shall
not exceed $12,000,000 at any time outstanding;


 


(b) Permitted Investments;


 


(c) loans or advances made by the Borrower to any Subsidiary and
made by any Subsidiary to Holdings, the Borrower or any other Subsidiary; provided that (i) any such loans and
advances made by a Loan Party to Subsidiaries that are not Loan Parties shall
be evidenced by a promissory note pledged to the Collateral Agent for the
ratable benefit of the Secured Parties pursuant to the Guarantee and Collateral
Agreement and (ii) the amount of such loans and advances made by Loan
Parties to Subsidiaries that are not Loan Parties shall be subject to the
limitation set forth in clause (a) above;


 


(d) investments received in connection with the
bankruptcy or reorganization of, or settlement of delinquent accounts and
disputes with, customers and suppliers, in each case in the ordinary course of
business;


 


(e) the Borrower and the Subsidiaries may make
loans and advances in the ordinary course of business to their respective
employees so long as the aggregate principal amount thereof at any time
outstanding (determined without regard to any write-downs or write-offs of such
loans and advances) shall not exceed $2,000,000;


 


(f) the Borrower and the Subsidiaries may enter
into Hedging Agreements that (i) are required by Section 5.12 or (ii) are
not speculative in nature and are


 


60

















 


related to income derived from foreign operations of the Borrower or
any Subsidiary or otherwise related to purchases from foreign suppliers;


 


(g) the Borrower or any Subsidiary may acquire
all or substantially all the assets of a person or line of business of such
person, or not less than 85% of the Equity Interests (other than directors’
qualifying shares) of a person (referred to herein as the “Acquired Entity”); provided that (i) such
acquisition was not preceded by an unsolicited tender offer for such Equity
Interests by, or proxy contest initiated by, Holdings, the Borrower or any
Subsidiary; (ii) the Acquired Entity shall be in a similar or reasonably
related or incidental line of business to those of the Borrower and the
Subsidiaries as conducted during the current and most recently concluded
calendar year; and (iii) at the time of such transaction (A) both before and
after giving effect thereto, no Default or Event of Default shall have occurred
and be continuing; (B) the Borrower would be in compliance with the
covenant set forth in Sections 6.11 as of the most recently completed period of
four consecutive fiscal quarters ending prior to such transaction for which the
financial statements and certificates required by Section 5.04(a) or
5.04(b), as the case may be, and 5.04(c) have been delivered, after giving
pro forma effect to such transaction and to any other event occurring after
such period as to which pro forma recalculation is appropriate (including any
other transaction described in this Section 6.04(g) occurring after
such period) as if such transaction had occurred as of the first day of such
period; (C) the total consideration paid in connection with such
acquisition and any other acquisitions pursuant to this Section 6.04(g) (including
any Indebtedness of the Acquired Entity that is assumed by the Borrower or any
Subsidiary following such acquisition and any payments following such
acquisition pursuant to earn-out provisions or similar obligations) shall not
in the aggregate exceed $50,000,000 and (D) the Borrower shall have
delivered a certificate of a Financial Officer, certifying as to the foregoing
and containing reasonably detailed calculations in support thereof, in form and
substance satisfactory to the Administrative Agent; (iv) the Borrower
shall comply, and shall cause the Acquired Entity to comply, with the
applicable provisions of Section 5.11 and the Security Documents; and (v) if
the Acquired Entity would not constitute a wholly owned Subsidiary of the
Borrower and would be required to become a Subsidiary Guarantor hereunder, each
holder of an Equity Interest therein (other than the Borrower or any wholly
owned Subsidiary) shall have executed and delivered to the Collateral Agent a
consent and waiver in form and substance reasonably satisfactory to the
Collateral Agent permitting such Acquired Entity to become a Subsidiary
Guarantor hereunder and a party to the Security Documents (any acquisition of
an Acquired Entity meeting all the criteria of this Section 6.04(g) being
referred to herein as a “Permitted
Acquisition”);  and


 


(h) in addition to investments permitted by
paragraphs (a) through (g) above, additional investments, loans and
advances by the Borrower and the Subsidiaries so long as the aggregate amount
invested, loaned or advanced pursuant to this paragraph (h) (determined
without regard to any write-downs or


 


61

















 


write-offs of such investments, loans and advances) does not exceed $6,000,000
in the aggregate.


 


SECTION 6.05.
Mergers, Consolidations, Sales
of Assets and Acquisitions.  (a) Merge
into or consolidate with any other person, or permit any other person to merge
into or consolidate with it, or sell, transfer, lease or otherwise dispose of
(in one transaction or in a series of transactions) all or substantially all
the assets (whether now owned or hereafter acquired) of the Borrower or less
than all the Equity Interests of any Subsidiary, or purchase, lease or otherwise
acquire (in one transaction or a series of transactions) all or any substantial
part of the assets of any other person, except that (i) the Borrower and
any Subsidiary may purchase and sell inventory in the ordinary course of
business and (ii) if at the time thereof and immediately after giving
effect thereto no Event of Default or Default shall have occurred and be
continuing (u) any wholly owned Subsidiary may merge into the Borrower in
a transaction in which the Borrower is the surviving corporation, (v) Holdings
may merge, liquidate, reorganize or otherwise be restructured into a
newly-formed Loan Party in a transaction the purpose of which is to re-organize
Holdings as a corporation; provided that
(1) such transaction (or series of transactions) does not result in a
material increase in the Tax obligations payable in cash (on a consolidated
basis) for Holdings, the Borrower, each Subsidiary of the Borrower and the
holders of Equity Interests in Holdings and (2) immediately following such
transaction, Holdings is in compliance with all requirements of the Guarantee
and Collateral Agreement and has satisfied its obligations under Section 5.11
(including the execution of any further documents, financing statements,
agreements and instruments, and the taking of all other actions, that may be
reasonably requested by the Required Lenders, the Administrative Agent or the
Collateral Agent), (w) any wholly owned Subsidiary may merge into or
consolidate with any other wholly owned Subsidiary in a transaction in which
the surviving entity is a wholly owned Subsidiary and no person other than the
Borrower or a wholly owned Subsidiary receives any consideration (provided
that if any party to any such transaction is a Loan Party,
the surviving entity of such transaction shall be a Loan Party), (x) the
Borrower and the Subsidiaries may make Permitted Acquisitions and (y) any
Inactive Subsidiary of the Borrower may be dissolved or liquidated.


 


(b)  Make
any Asset Sale otherwise permitted under paragraph (a) above unless (i) such
Asset Sale is for consideration at least 75% of which is cash, (ii) such
consideration is at least equal to the fair market value of the assets being
sold, transferred, leased or disposed of and (iii) the fair market value
of all assets sold, transferred, leased or disposed of pursuant to this
paragraph (b) shall not exceed (x) $10,000,000 in any fiscal year or (y) $50,000,000
in the aggregate.


 


SECTION 6.06.
Restricted Payments; Restrictive
Agreements.  (a) Declare
or make, or agree to declare or make, directly or indirectly, any Restricted
Payment (including pursuant to any Synthetic Purchase Agreement), or incur any
obligation (contingent or otherwise) to do so; provided,
however, that (i) any Subsidiary may declare and pay dividends
or make other distributions ratably to its equity holders, (ii) so long as
no Event of Default or Default shall have occurred and be continuing or would
result therefrom, the Borrower may, or the Borrower may make distributions to
Holdings


 


62

















 


so that Holdings may,
repurchase its Equity Interests owned by employees of Holdings, the Borrower or
the Subsidiaries or make payments to employees of Holdings, the Borrower or the
Subsidiaries upon termination of employment in connection with the exercise of
stock options, stock appreciation rights or similar equity incentives or equity
based incentives pursuant to management incentive plans or in connection with
the death or disability of such employees in an aggregate amount not to exceed
$2,000,000 in any fiscal year, (iii) the Borrower may make Restricted
Payments to Holdings (x) in an amount not to exceed $500,000 in any fiscal
year, to the extent necessary to pay general corporate and overhead expenses
incurred by Holdings in the ordinary course of business and (y) if
Borrower is a member of a consolidated, combined or unitary group of which
Borrower is not the common parent, in an amount necessary to pay the Tax
liabilities of the common parent (the “Common Parent”)  of
the consolidated, combined or unitary group of which Borrower is not the common
parent directly attributable to (or arising as a result of) the operations of
the Borrower and the Subsidiaries; provided,
however, that (A) the amount of such dividends shall not exceed the
amount that the Borrower and the Subsidiaries would be required to pay in
respect of Federal, state and local taxes were the Borrower and the
Subsidiaries to pay such taxes as members of a consolidated, combined or
unitary group of which Borrower is the common parent and (B) all
Restricted Payments made to Holdings pursuant to this clause (iii) are
used by Holdings to make Restricted Payments as specified in clause (iv) within
20 days of the receipt thereof and (iv) if Borrower is a member of a
consolidated, combined or unitary group of which Borrower is not the common
parent, then Holdings may make Restricted Payments to the Common Parent (x) in
an amount not to exceed $500,000 in any fiscal year, to the extent necessary to
pay general corporate and overhead expenses incurred by the Common Parent in
the ordinary course of business and (y) in an amount necessary to pay the
Tax liabilities of the Common Parent directly attributable to (or arising as a
result of) the operations of the Borrower and the Subsidiaries; provided, however, that (A) the
amount of such dividends shall not exceed the amount that the Borrower and the
Subsidiaries would be required to pay in respect of Federal, state and local
taxes were the Borrower and the Subsidiaries to pay such taxes as members of a
consolidated, combined or unitary group of which Borrower is the common parent
and (B) all Restricted Payments made to the Common Parent pursuant to this
clause (iv) are used by the Common Parent for the purposes specified herein
within 20 days of the receipt thereof.


 


(b)   Enter
into, incur or permit to exist any agreement or other arrangement that
prohibits, restricts or imposes any condition upon (i) the ability of
Holdings, the Borrower or any Subsidiary to create, incur or permit to exist
any Lien upon any of its property or assets to secure the Obligations, or (ii) the
ability of any Subsidiary to pay dividends or other distributions with respect
to any of its Equity Interests or to make or repay loans or advances to the
Borrower or any other Subsidiary or to Guarantee Indebtedness of the Borrower
or any other Subsidiary; provided that
(A) the foregoing shall not apply to restrictions and conditions imposed
by law or by any Loan Document or any First Lien Loan Document, (B) the
foregoing shall not apply to customary restrictions and conditions contained in
agreements relating to the sale of a Subsidiary pending such sale, provided such restrictions and conditions
apply only to the Subsidiary that is to be sold and such sale is permitted
hereunder, (C) the foregoing shall not apply to restrictions and
conditions imposed on any Foreign Subsidiary by the terms of any


 


63

















 


Indebtedness of such
Foreign Subsidiary permitted to be incurred hereunder, (D) clause (i) of
the foregoing shall not apply to restrictions or conditions imposed by any
agreement relating to secured Indebtedness permitted by this Agreement if such
restrictions or conditions apply only to the property or assets securing such
Indebtedness and (E) clause (i) of the foregoing shall not apply to
customary provisions in leases and other contracts restricting the assignment
thereof.


 


SECTION 6.07.
Transactions with Affiliates.  Except for transactions between or among
Loan Parties and transactions pursuant to the Advisory Services and Monitoring
Agreements as in effect as of the Closing Date, sell or transfer any property
or assets to, or purchase or acquire any property or assets from, or otherwise
engage in any other transactions with, any of its Affiliates, except that the
Borrower or any Subsidiary may engage in any of the foregoing transactions in
the ordinary course of business at prices and on terms and conditions not less
favorable to the Borrower or such Subsidiary than could be obtained on an arm’s-length
basis from unrelated third parties.


 


SECTION 6.08.
Business of Holdings,  Borrower and Subsidiaries.
(a) With respect to Holdings, engage in any business activities
or have any assets or liabilities other than its ownership of the Equity
Interests of the Borrower and liabilities incidental thereto, including its
liabilities as a Guarantor pursuant to the Guarantee and Collateral Agreement
and its Guarantees of obligations under the First Lien Loan Documents.


 


(b)   With
respect to the Borrower and its Subsidiaries, engage at any time in any
business or business activity other than the business currently conducted by it
and business activities reasonably incidental thereto.


 


SECTION 6.09.
Other Indebtedness and Agreements.  (a) Permit (i) any waiver,
supplement, modification, amendment, termination or release of any indenture,
instrument or agreement pursuant to which the First Lien Loan or any
subordinated Material Indebtedness of Holdings, the Borrower or any of the Subsidiaries
is outstanding if the effect of such waiver, supplement, modification,
amendment, termination or release would materially increase the obligations of
the obligor or confer additional material rights on the holder of such
Indebtedness in a manner adverse to Holdings, the Borrower, any of the
Subsidiaries or the Lenders; provided that
the First Lien Loan Documents may be amended in accordance with the
Intercreditor Agreement, or (ii) any waiver, supplement, modification or
amendment of its certificate of incorporation, by-laws, operating, management
or partnership agreement or other organizational documents to the extent any
such waiver, supplement modification or amendment would be adverse to the
Lenders in any material respect.


 


(b)  (i)  Make
any distribution, whether in cash, property, securities or a combination
thereof, other than regular scheduled payments of principal and interest as and
when due (to the extent not prohibited by applicable subordination provisions),
in respect of, or pay, or commit to pay, or directly or indirectly (including
pursuant to any Synthetic Purchase Agreement) redeem, repurchase, retire or
otherwise acquire for consideration, or set apart any sum for the aforesaid
purposes any Indebtedness (other than the Loans and the First Lien Loans), or (ii) pay
in cash any amount in respect of any


 


64

















 


Indebtedness or preferred
Equity Interests that may at the obligor’s option be paid in kind or in other
securities (other than the payment of PIK Interest on the Loans in accordance
with Section 2.06).


 


SECTION 6.10.
Capital Expenditures.  (a) Permit the aggregate amount of
Capital Expenditures made by the Borrower and the Subsidiaries in any period
set forth below to exceed the amount set forth below for such period:


 


	
  Period

  	
   

  	
  Amount

  	
   

  
	
  Closing Date -
  December 31, 2007

  	
   

  	
  $

  	
  15,000,000

  	
   

  
	
  January 1, 2008 -
  December 31, 2008

  	
   

  	
  $

  	
  10,000,000

  	
   

  
	
  January 1, 2009 -
  December 31, 2009

  	
   

  	
  $

  	
  12,000,000

  	
   

  
	
  January 1, 2010 -
  December 31, 2010

  	
   

  	
  $

  	
  14,000,000

  	
   

  
	
  January 1, 2011 -
  December 31, 2011

  	
   

  	
  $

  	
  15,000,000

  	
   

  
	
  January 1, 2012 -
  December 31, 2012

  	
   

  	
  $

  	
  16,000,000

  	
   

  
	
  January 1, 2013 -
  December 31, 2013

  	
   

  	
  $

  	
  17,000,000

  	
   

  
	
  January 1, 2014 -
  Maturity Date

  	
   

  	
  $

  	
  18,000,000

  	
   

  



 


If, in any fiscal
year, the Consolidated EBITDA exceeds the Baseline EBITDA for such fiscal year,
the amount of permitted Capital Expenditures set forth above in respect of such
fiscal year shall be increased (but not decreased) by 40% of the excess of (i) the
Consolidated EBITDA for such fiscal year over (ii) the Baseline EBITDA for
such fiscal year.


 


Any unused amount
of Capital Expenditures permitted to be made during each fiscal year may be
carried forward to, and made, at any time during the next succeeding two fiscal
years; provided that,  for
purposes of this sentence, Capital Expenditures made in any fiscal year shall
be deemed to use the amount permitted to be made during such fiscal year set
forth above before using the amount carried forward to such fiscal year.


 


(b)   Notwithstanding
subsection (a) above, the Borrower and its Subsidiaries may make Capital
Expenditures with the Net Cash Proceeds of (A) Specified Equity Issuances
by Holdings, the Borrower or any of their respective subsidiaries permitted
hereunder or (B) any Asset Sale, or any sale of used, worn out or surplus
equipment, in each case to the extent such Net Cash Proceeds are not required
to be applied to prepay loans, or cash collateralize, letters of credit, under
the First Lien Credit Agreement or to prepay Loans hereunder.


 


SECTION 6.11. Maximum Total Leverage Ratio.  Permit the Total Leverage Ratio at any
time during a period set forth below to be greater than the ratio set forth
opposite such period below:


 


65

















 


	
  Period

  	
   

  	
  Ratio

  	
   

  
	
  September 30,
  2007

  	
   

  	
  8.00 to 1.00

  	
   

  
	
  December 31,
  2007

  	
   

  	
  8.00 to 1.00

  	
   

  
	
  March 31,
  2008

  	
   

  	
  8.00 to 1.00

  	
   

  
	
  June 30,
  2008

  	
   

  	
  8.00 to 1.00

  	
   

  
	
  September 30,
  2008

  	
   

  	
  7.75 to 1.00

  	
   

  
	
  December 31,
  2008

  	
   

  	
  7.25 to 1.00

  	
   

  
	
  March 31,
  2009

  	
   

  	
  6.50 to 1.00

  	
   

  
	
  June 30,
  2009

  	
   

  	
  6.50 to 1.00

  	
   

  
	
  September 30,
  2009

  	
   

  	
  6.50 to 1.00

  	
   

  
	
  December 31,
  2009

  	
   

  	
  6.50 to 1.00

  	
   

  
	
  March 31, 2010

  	
   

  	
  6.25 to 1.00

  	
   

  
	
  June 30,
  2010

  	
   

  	
  6.25 to 1.00

  	
   

  
	
  September 30,
  2010

  	
   

  	
  6.25 to 1.00

  	
   

  
	
  December 31,
  2010

  	
   

  	
  6.25 to 1.00

  	
   

  
	
  March 31, 2011

  	
   

  	
  5.25 to 1.00

  	
   

  
	
  June 30,
  2011

  	
   

  	
  5.25 to 1.00

  	
   

  
	
  September 30,
  2011

  	
   

  	
  5.25 to 1.00

  	
   

  
	
  December 31,
  2011

  	
   

  	
  5.25 to 1.00

  	
   

  
	
  March 31,
  2012

  	
   

  	
  5.25 to 1.00

  	
   

  



 


SECTION 6.12.
Fiscal Year.  With
respect to Holdings and the Borrower, change their fiscal year-end to a date
other than December 31.


 


SECTION 6.13.
Certain Equity Securities.  Issue any Equity Interest that
is not Qualified Capital Stock.


 


ARTICLE VII


 


Events of
Default


 


In case of the
happening of any of the following events (“Events of Default”):


 


(a)  any representation or warranty made or deemed made in or
in connection with any Loan Document or the borrowings hereunder, or any
representation, warranty, statement or information contained in any report,
certificate, financial statement or other instrument furnished in connection
with or pursuant to any Loan Document, shall prove to have been false or
misleading in any material respect when so made, deemed made or furnished;


 


66














 


(b)  default shall be made in the payment of
any principal of any Loan when and as the same shall become due and payable,
whether at the due date thereof or at a date fixed for prepayment thereof or by
acceleration thereof or otherwise;


 


(c)  default shall be made in the payment of
any interest on any Loan or any fee or any other amount (other than an amount
referred to in (b) above) due under any Loan Document, when and as the
same shall become due and payable, and such default shall continue unremedied for
a period of three Business Days;


 


(d)  default shall be made in the due observance or
performance by Holdings, the Borrower or any Subsidiary of any covenant,
condition or agreement contained in Section 5.01(a), 5.05(a), 5.05(d) or
5.08 or in Article VI;


 


(e)  default shall be made in the
due observance or performance by Holdings, the Borrower or any
Subsidiary of any covenant, condition or agreement contained in any Loan
Document (other than those specified in (b), (c) or (d) above) and
such default shall continue unremedied for a period of 30 days after notice
thereof from the Administrative Agent or the Required Lenders to the Borrower;


 


(f) (i) Holdings, the Borrower or any Subsidiary shall fail
to pay any principal, interest or other amount due in respect of any Material
Indebtedness, when and as the same shall become due and payable after giving
effect to any grace periods applicable thereto or (ii) any other event or
condition occurs that results in any Material Indebtedness becoming due prior
to its scheduled maturity or that enables or permits (with or without the
giving of notice, the lapse of time or both) the holder or holders of any
Material Indebtedness or any trustee or agent on its or their behalf to cause
any Material Indebtedness to become due, or to require the prepayment,
repurchase, redemption or defeasance thereof, prior to its scheduled maturity
or that results in the termination or permits any counterparty to terminate any
Hedging Agreement the obligations under which constitute Material Indebtedness;
provided that this clause (ii) shall
not apply to secured Indebtedness that becomes due as a result of the voluntary
sale or transfer of the property or assets securing such Indebtedness or to
mandatory prepayments of First Lien Loans required pursuant to Section 2.13
of the First Lien Credit Agreement; provided
further that an Event of Default under and as defined in the First
Lien Credit Agreement (other than the Events of Default described in paragraphs
(b) or (c) of Article VII of the First Lien Credit Agreement to
which this proviso shall not apply) (a “First Lien Event of Default”)  shall not in and of itself
constitute an Event of Default under this paragraph until the earlier to occur
of (x) a period of 60 days has elapsed following notice of such First Lien
Event of Default from the administrative agent or any lender under the First
Lien Credit Agreement to the Borrower, or from the Borrower to such
administrative agent or any such lender, and (y) the acceleration of the
maturity of any of the loans or the termination of any of the commitments under
the First Lien Credit Agreement in connection with such First Lien Event of
Default or the exercise of any remedies


 


67

















 


by the lenders or
the administrative agent under the First Lien Credit Agreement in connection
with such First Lien Event of Default;


 


(g) an involuntary proceeding shall be commenced or an involuntary
petition shall be filed in a court of competent jurisdiction seeking (i) relief
in respect of Holdings, the Borrower or any Material Subsidiary (or any group
of Subsidiaries that, when taken together, would constitute a Material
Subsidiary), or of a substantial part of the property or assets of Holdings,
the Borrower or a Material Subsidiary (or any group of Subsidiaries that, when
taken together, would constitute a Material Subsidiary), under Title 11 of the
United States Code, as now constituted or hereafter amended, or any other
Federal, state or foreign bankruptcy, insolvency, receivership or similar law, (ii) the
appointment of a receiver, trustee, custodian, sequestrator, conservator or
similar official for Holdings, the Borrower or any Material Subsidiary (or any
group of Subsidiaries that, when taken together, would constitute a Material
Subsidiary) or for a substantial part of the property or assets of Holdings,
the Borrower or a Material Subsidiary (or any group of Subsidiaries that, when
taken together, would constitute a Material Subsidiary) or (iii) the
winding-up or liquidation of Holdings, the Borrower or any Material Subsidiary
(or any group of Subsidiaries that, when taken together, would constitute a
Material Subsidiary); and such proceeding or petition shall continue
undismissed for 60 days or an order or decree approving or ordering any of the
foregoing shall be entered;


 


(h) Holdings, the Borrower or any Subsidiary shall (i) voluntarily
commence any proceeding or file any petition seeking relief under Title 11 of
the United States Code, as now constituted or hereafter amended, or any other
Federal, state or foreign bankruptcy, insolvency, receivership or similar law, (ii) consent
to the institution of, or fail to contest in a timely and appropriate manner,
any proceeding or the filing of any petition described in (g) above, (iii) apply
for or consent to the appointment of a receiver, trustee, custodian,
sequestrator, conservator or similar official for Holdings, the Borrower or any
Subsidiary or for a substantial part of the property or assets of Holdings, the
Borrower or any Subsidiary, (iv) file an answer admitting the material
allegations of a petition filed against it in any such proceeding, (v) make
a general assignment for the benefit of creditors, (vi) become unable,
admit in writing its inability or fail generally to pay its debts as they
become due or (vii) take any action for the purpose of effecting any of
the foregoing;


 


(i) one or more judgments shall be rendered against Holdings, the
Borrower, any Subsidiary or any combination thereof and the same shall remain
undischarged for a period of 30 consecutive days during which execution shall
not be effectively stayed, or any action shall be legally taken by a judgment
creditor to levy upon assets or properties of Holdings, the Borrower or any
Subsidiary to enforce any such judgment and such judgment either (i) is
for the payment of money in an aggregate amount in excess of $6,000,000 or (ii) is
for injunctive relief and could reasonably be expected to result in a Material
Adverse Effect;


 


68

















 


(j) an ERISA Event shall have occurred that, when taken together
with all other such ERISA Events, could reasonably be expected to result in
actual liability to Holdings, the Borrower or any Subsidiary (or any combination
thereof), including directly or indirectly through their ERISA Affiliates, in
an aggregate amount exceeding $6,000,000;


 


(k) any Guarantee under the Guarantee and Collateral Agreement for
any reason shall cease to be in full force and effect (other than in accordance
with its terms), or any Guarantor shall deny in writing that it has any further
liability under the Guarantee and Collateral Agreement (other than as a result
of the discharge of such Guarantor in accordance with the terms of the Loan
Documents);


 


(l) any security interest purported to be created by any Security
Document shall cease to be, or shall be asserted by the Borrower or any other
Loan Party not to be, a valid, perfected, first priority (subject to the
Intercreditor Agreement) (except as otherwise expressly provided in this
Agreement or such Security Document) security interest in the securities,
assets or properties covered thereby, except to the extent that any such loss
of perfection or priority results from the failure of the First Lien Collateral
Agent (as defined in the Intercreditor Agreement) to maintain possession of
certificates representing securities pledged under the Guarantee and Collateral
Agreement and except to the extent that such loss is covered by a lender’s
title insurance policy and the related insurer promptly after such loss shall
have acknowledged in writing that such loss is covered by such title insurance
policy;


 


(m) the Intercreditor Agreement shall, in whole or in part, cease
to be effective or cease to be legally valid, binding and enforceable against
any party thereto (or against any person on whose behalf any such party makes
any covenants or agreements therein), or otherwise not be effective to create
the rights and obligations purported to be created thereunder unless the same
results directly from the action or inaction of the Collateral Agent; or


 


(n) there shall have occurred a Change in Control;


 


then, and in every
such event (other than an event with respect to Holdings or the Borrower
described in paragraph (g) or (h) above), and at any time thereafter
during the continuance of such event, the Administrative Agent may, and at the
request of the Required Lenders shall, by notice to the Borrower, take either
or both of the following actions, at the same or different times: (i) terminate
forthwith the Commitments and (ii) declare the Loans then outstanding to
be forthwith due and payable in whole or in part, whereupon the principal of
the Loans so declared to be due and payable, together with accrued interest
thereon and any unpaid accrued fees and all other liabilities of the Borrower
accrued hereunder and under any other Loan Document, shall become forthwith due
and payable, without presentment, demand, protest or any other notice of any
kind, all of which are hereby expressly waived by the Borrower, anything
contained herein or in any other Loan Document to the contrary notwithstanding;
and in any event


 


69

















 


with respect to Holdings
or the Borrower described in paragraph (g) or (h) above, the
Commitments shall automatically terminate and the principal of the Loans then
outstanding, together with accrued interest thereon and any unpaid accrued fees
and all other liabilities of the Borrower accrued hereunder and under any other
Loan Document, shall automatically become due and payable, without presentment,
demand, protest or any other notice of any kind, all of which are hereby
expressly waived by the Borrower, anything contained herein or in any other
Loan Document to the contrary notwithstanding.


 


Notwithstanding
anything to the contrary contained in the foregoing provisions of this Article VII,
in the event that the Borrower fails to comply with Section 6.11, until
the expiration of the 10th day subsequent to the date the certificate
calculating such compliance is required to be delivered pursuant to Section 5.04(c),
the Borrower shall have the right to issue common equity for cash or otherwise
receive cash contributions to the capital of the Borrower (collectively, the “Cure Right”),  and
upon receipt by the Borrower of such cash (the “Cure Amount”) pursuant to the exercise of
the Borrower of such Cure Right the applicable covenants shall be recalculated
giving effect to the following pro forma adjustments:


 


(i)  Consolidated EBITDA for the immediately preceding fiscal
quarter shall be increased, solely for the purpose of measuring compliance with
Section 6.11 for such fiscal quarter and each period thereafter in which
the Consolidated EBITDA for such fiscal quarter is contained, and not for any
other purpose under this Agreement, by an amount equal to the Cure Amount; and


 


(ii)  if, after giving effect to the foregoing
recalculations, the Borrower shall then be in compliance with Section 6.11
as of the relevant date of determination with the same effect as though there
had been no failure to comply therewith at such date, then the applicable
breach or default of the covenants set forth in Section 6.11 that had
occurred shall be deemed cured for all purposes of this Agreement as fully as
if such breach or default had never occurred.


 


Notwithstanding
anything herein to the contrary, (A) in each four quarter period there
shall be a period of at least two fiscal quarters in which the Cure Right is
not exercised, (B) in each eight quarter period there shall be a period of
at least four fiscal quarters in which the Cure Right is not exercised, (C) the
amount of any Cure Amount shall be no greater than the amount required to cause
the Borrower to be in compliance with Section 6.11 and (D) all Cure
Amounts shall be disregarded for all other purposes under this Agreement,
including any baskets in Article VI and the definitions of Applicable
Margin and Required Prepayment Percentage.


 


ARTICLE VIII


 


The Administrative Agent and the Collateral Agent


 


Each of the
Lenders hereby irrevocably appoints the Administrative Agent and the Collateral
Agent (for purposes of this Article VIII, the Administrative Agent and the


 


70

















 


Collateral Agent are
referred to collectively as the “Agents”) its
agent and authorizes the Agents to take such actions on its behalf and to
exercise such powers as are delegated to such Agent by the terms of the Loan
Documents, together with such actions and powers as are reasonably incidental
thereto. Without limiting the generality of the foregoing, the Agents are
hereby expressly authorized to execute any and all documents (including
releases) with respect to the Collateral and the rights of the Secured Parties
with respect thereto, as contemplated by and in accordance with the provisions
of this Agreement and the Security Documents. The Lenders acknowledge and agree
that the Administrative Agent shall also act, subject to and in accordance with
the terms of the Intercreditor Agreement as the administrative agent and
collateral agent for the lenders under the First Lien Credit Agreement.


 


The bank serving
as the Administrative Agent and/or the Collateral 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 an Agent, and such bank and its
Affiliates may accept deposits from, lend money to and generally engage in any
kind of business with Holdings, the Borrower or any Subsidiary or other
Affiliate thereof as if it were not an Agent hereunder.


 


Neither Agent
shall have any duties or obligations except those expressly set forth in the
Loan Documents. Without limiting the generality of the foregoing, (a) neither
Agent shall be subject to any fiduciary or other implied duties, regardless of
whether a Default has occurred and is continuing, (b) neither Agent shall
have any duty to take any discretionary action or exercise any discretionary
powers, except discretionary rights and powers expressly contemplated hereby
that such Agent is instructed in writing to exercise by the Required Lenders
(or such other number or percentage of the Lenders as shall be necessary under
the circumstances as provided in Section 9.08), and (c) except as
expressly set forth in the Loan Documents, neither Agent shall have any duty to
disclose, nor shall it be liable for the failure to disclose, any information
relating to Holdings, the Borrower or any of the Subsidiaries that is
communicated to or obtained by the bank serving as Administrative Agent and/or
Collateral Agent or any of its Affiliates in any capacity. Neither Agent shall
be liable for any action taken or not taken by it with the consent or at the
request of the Required Lenders (or such other number or percentage of the
Lenders as shall be necessary under the circumstances as provided in Section 9.08)
or in the absence of its own gross negligence or willful misconduct. Neither
Agent shall be deemed to have knowledge of any Default unless and until written
notice thereof is given to such Agent by Holdings, the Borrower or a Lender,
and neither Agent shall be responsible for or have any duty to ascertain or
inquire into (i) any statement, warranty or representation made in or in
connection with any Loan Document, (ii) the contents of any certificate,
report or other document delivered thereunder or in connection therewith, (iii) the
performance or observance of any of the covenants, agreements or other terms or
conditions set forth in any Loan Document, (iv) the validity,
enforceability, effectiveness or genuineness of any Loan Document or any other
agreement, instrument or document, or (v) the satisfaction of any
condition set forth in Article IV or elsewhere in any Loan Document, other
than to confirm receipt of items expressly required to be delivered to such
Agent.


 


71

















 


Each 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 believed by it to be genuine and to have been signed or sent by
the proper person. Each Agent may also 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. Each 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.


 


Each Agent may
perform any and all its duties and exercise its rights and powers by or through
any one or more sub-agents appointed by it. Each Agent and any such sub-agent
may perform any and all its duties and exercise its rights and powers by or
through their respective Related Parties. The exculpatory provisions of the
preceding paragraphs shall apply to any such sub-agent and to the Related
Parties of each Agent and any such sub-agent, and shall apply to their
respective activities in connection with the syndication of the Credit Facility
as well as activities as Agent.


 


Subject to the
appointment and acceptance of a successor Agent as provided below, either Agent
may resign at any time by notifying the Lenders and the Borrower. Upon any such
resignation, the Required Lenders shall have the right, with the consent of the
Borrower (not to be unreasonably withheld or delayed), unless a default of
payment or bankruptcy is continuing, in which case no such consent shall be
required, to appoint a successor, which shall be a bank with an office in the
United States or an Affiliate of such bank with an office in the United States.
If no successor shall have been so appointed by the Required Lenders and shall
have accepted such appointment within 30 days after the retiring Agent gives
notice of its resignation (including, for greater certainty, due to the failure
of the Borrower to consent to such appointment), then the retiring Agent may,
on behalf of the Lenders, appoint a successor Agent which shall be a bank with
an office in New York, New York, or an Affiliate of any such bank. Upon the
acceptance of its appointment as Agent hereunder by a successor, such successor
shall succeed to and become vested with all the rights, powers, privileges and
duties of the retiring Agent, and the retiring Agent shall be discharged from
its duties and obligations hereunder. The fees payable by the Borrower to a
successor Agent shall be the same as those payable to its predecessor unless
otherwise agreed between the Borrower and such successor. After an Agent’s
resignation hereunder, the provisions of this Article and Section 9.05
shall continue in effect for the benefit of such retiring 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 acting as Agent.


 


Each Lender
acknowledges that it has, independently and without reliance upon the Agents or
any other Lender and based on such documents and information as it has deemed
appropriate, made its own credit analysis and decision to enter into this
Agreement. Each Lender also acknowledges that it will, independently and
without reliance upon the Agents or any other Lender and based on such
documents and information as it shall from time to time deem appropriate,
continue to make its own decisions in taking or not taking action under or
based upon this Agreement or any other


 


72

















 


Loan Document any related
agreement or any document furnished hereunder or thereunder.


 


ARTICLE IX


 


Miscellaneous


 


SECTION 9.01.
Notices.  Notices and other communications provided
for herein shall be in writing and shall be delivered by hand or nationally
recognized overnight courier service, mailed by certified or registered mail or
sent by fax, as follows:


 


(a)   if to the Borrower or Holdings, to it at 10 Water
Street, Enfield, CT 06082-4899, Attention of Chief Financial Officer (Fax No. (860)
749-9158); with a copy to STR Holdings LLC, c/o DLJ Merchant Banking, Attention
of Dan Gerwitz (Fax No. (860) 749-9158);


 


(b)   if to the Administrative Agent, to Credit Suisse,
Eleven Madison Avenue, New York, NY 10010, Attention of Matthew Carter RDU-2
(Fax No. (212) 743-1842); and


 


(c)   if to a Lender, to it at its address (or fax
number) set forth on Schedule 2.01 or in the Assignment and Acceptance pursuant
to which such Lender shall have become a party hereto.


 


All notices and
other communications given to any party hereto in accordance with the
provisions of this Agreement shall be deemed to have been given on the date of
receipt if delivered by hand or nationally recognized overnight courier service
or sent by fax or on the date five Business Days after dispatch by certified or
registered mail if mailed, in each case delivered, sent or mailed (properly
addressed) to such party as provided in this Section 9.01 or in accordance
with the latest unrevoked direction from such party given in accordance with
this Section 9.01. As agreed to among Holdings, the Borrower, the
Administrative Agent and the applicable Lenders from time to time, notices and
other communications may also be delivered by e-mail to the e-mail address of a
representative of the applicable person provided from time to time by such
person so long as a copy of such notice or other communication is also sent by
one of the other methods set forth above; provided,
however, that notices given by the Borrower to the Administrative
Agent pursuant to Article II may not be delivered by email unless
otherwise agreed to by the Administrative Agent on a case by case basis.


 


SECTION 9.02. Survival
of Agreement. All
covenants, agreements, representations and warranties made by the Borrower or
Holdings herein and in the certificates or other instruments prepared or
delivered in connection with, or pursuant to, this Agreement or any other Loan
Document shall be considered to have been relied upon by the Lenders and shall
survive the making by the Lenders of the Loans, regardless of any investigation
made by the Lenders or on their behalf, and shall continue in full force and
effect as long as the principal of, or any accrued interest on, any Loan or any
fee or any other amount payable under this Agreement or any other Loan Document
is


 


73

















 


outstanding and unpaid
and so long as the Commitments have not been terminated. The provisions of
Sections 2.13, 2.15, 2.19 and 9.05 shall remain operative and in full force and
effect regardless of the expiration of the term of this Agreement, the
consummation of the transactions contemplated hereby, the repayment of any of
the Loans, the expiration of the Commitments, the invalidity or
unenforceability of any term or provision of this Agreement or any other Loan
Document, or any investigation made by or on behalf of the Administrative Agent,
the Collateral Agent or any Lender.


 


SECTION 9.03.
Binding Effect.  This Agreement shall become effective
when it shall have been executed by the Borrower, Holdings and the
Administrative Agent and when the Administrative Agent shall have received
counterparts hereof which, when taken together, bear the signatures of each of
the other parties hereto.


 


SECTION 9.04.
Successors and Assigns.  (a) Whenever in this Agreement any
of the parties hereto is referred to, such reference shall be deemed to include
the permitted successors and assigns of such party; and all covenants, promises
and agreements by or on behalf of the Borrower, Holdings, the Administrative
Agent, the Collateral Agent or the Lenders that are contained in this Agreement
shall bind and inure to the benefit of their respective successors and assigns.


 


(b)   Each
Lender may assign to one or more Eligible Assignees all or a portion of its
interests, rights and obligations under this Agreement (including all or a
portion of its Commitment and the Loans at the time owing to it), with notice
to the Borrower delivered from time to time and the prior written consent of
the Administrative Agent (not to be unreasonably withheld or delayed); provided, however, that (i) the
amount of the Commitment or Loans of the assigning Lender subject to each such
assignment (determined as of the date the Assignment and Acceptance with
respect to such assignment is delivered to the Administrative Agent) shall be
in an integral multiple of, and not less than, $1,000,000 (or, if less, the
entire remaining amount of such Lender’s Commitment or Loans of the relevant
Class), (ii) the parties to each such assignment shall execute and deliver
to the Administrative Agent an Assignment and Acceptance via an electronic
settlement system acceptable to the Administrative Agent (or, if previously
agreed with the Administrative Agent, manually), and shall pay to the
Administrative Agent a processing and recordation fee of $3,500 (which fee may
be waived or reduced in the sole discretion of the Administrative Agent), and (iii) the
assignee, if it shall not be a Lender, shall deliver to the Administrative
Agent an Administrative Questionnaire and all applicable tax forms. Upon
acceptance and recording pursuant to paragraph (e) of this Section 9.04,
from and after the effective date specified in each Assignment and Acceptance, (A) the
assignee thereunder shall be a party hereto and, to the extent of the interest
assigned by such Assignment and Acceptance, have the rights and obligations of
a Lender under this Agreement and (B) the assigning Lender thereunder
shall, to the extent of the interest assigned by such Assignment and
Acceptance, be released from its obligations under this Agreement (and, in the
case of an Assignment and Acceptance covering all or the remaining portion of
an assigning Lender’s rights and obligations under this Agreement, such Lender
shall cease to be a party hereto but shall continue to be entitled to the
benefits of Sections 2.13, 2.15, 2.19 and 9.05, as well as to any fees accrued
for its account and not yet paid).


 


74

















 


(c)   By executing and delivering an Assignment and
Acceptance, the assigning Lender thereunder and the assignee thereunder shall
be deemed to confirm to and agree with each other and the other parties hereto
as follows: (i) such
assigning Lender warrants that it is the legal and beneficial owner of the
interest being assigned thereby free and clear of any adverse claim and that
its Commitment, and the outstanding balances of its Loans, in each case without
giving effect to assignments thereof which have not become effective, are as set
forth in such Assignment and Acceptance; (ii) except as set forth in (i) above,
such assigning Lender makes no representation or warranty and assumes no
responsibility with respect to any statements, warranties or representations
made in or in connection with this Agreement, or the execution, legality,
validity, enforceability, genuineness, sufficiency or value of this Agreement,
any other Loan Document or any other instrument or document furnished pursuant
hereto or the financial condition of the Borrower or any Subsidiary or the
performance or observance by the Borrower or any Subsidiary of any of its
obligations under this Agreement, any other Loan Document or any other
instrument or document furnished pursuant hereto; (iii) such assignee
represents and warrants that it is an Eligible Assignee and is legally
authorized to enter into such Assignment and Acceptance; (iv) such
assignee confirms that it has received a copy of this Agreement, together with
copies of the most recent financial statements referred to in Section 3.05(a) or
delivered pursuant to Section 5.04 the Intercreditor Agreement and such
other documents and information as it has deemed appropriate to make its own
credit analysis and decision to enter into such Assignment and Acceptance; (v) such
assignee will independently and without reliance upon the Administrative Agent,
the Collateral Agent, such assigning Lender or any other Lender and based on
such documents and information as it shall deem appropriate at the time
continue to make its own credit decisions in taking or not taking action under
this Agreement; (vi) such assignee agrees to be bound by the terms of the
Intercreditor Agreement; (vii) such assignee appoints and authorizes the
Administrative Agent and the Collateral Agent to take such action as agent on
its behalf and to exercise such powers under this Agreement as are delegated to
the Administrative Agent and the Collateral Agent, respectively, by the terms
hereof, together with such powers as are reasonably incidental thereto; and (viii) such
assignee agrees that it will perform in accordance with their terms all the
obligations which by the terms of this Agreement are required to be performed
by it as a Lender.


 


(d)   The Administrative Agent, acting for this purpose
as an agent of the Borrower, shall maintain at one of its offices in The City
of New York a copy of each Assignment and Acceptance delivered to it and a
register for the recordation of the names and addresses of the Lenders and the
Commitment of, and principal amount of the Loans owing to, each Lender pursuant
to the terms hereof from time to time (the “Register”).
The entries in the Register shall be conclusive and the Borrower the
Administrative Agent, the Collateral 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,
the Collateral Agent and any Lender, at any reasonable time and from time to
time upon reasonable prior notice.


 


75

















 


(e)   Upon its receipt of, and consent to, a duly
completed Assignment and Acceptance executed by an assigning Lender and an
assignee, an Administrative Questionnaire completed in respect of the assignee
(unless the assignee shall already he a Lender hereunder), the processing and
recordation fee referred to in paragraph (b) above, if applicable, and the
written consent of the Administrative Agent and, if required, the Borrower to
such assignment and any applicable tax forms, the Administrative Agent shall
promptly (i) accept such Assignment and Acceptance and (ii) record
the information contained therein in the Register. No assignment shall be
effective unless it has been recorded in the Register as provided in this
paragraph (e).


 


(f)   Each Lender may without the consent of the
Borrower or the Administrative Agent sell participations to one or more banks
or other persons in all or a portion of its rights and obligations under this
Agreement (including all or a portion of its Commitment and the Loans owing to
it); provided, however, that (i) such
Lender’s obligations under this Agreement shall remain unchanged, (ii) such
Lender shall remain solely responsible to the other parties hereto for the
performance of such obligations, (iii) the participating banks or other
persons shall be entitled to the benefit of the cost protection provisions
contained in Sections 2.13, 2.15 and 2.19 to the same extent as if they were
Lenders (but, with respect to any particular participant, to no greater extent
than the Lender that sold the participation to such participant), (iv) the
Borrower, the Administrative Agent and the Lenders shall continue to deal
solely and directly with such Lender in connection with such Lender’s rights
and obligations under this Agreement, and such Lender shall retain the sole
right to enforce the obligations of the Borrower relating to the Loans and to
approve any amendment, modification or waiver of any provision of this
Agreement (other than amendments, modifications or waivers decreasing any fees
payable to such participating bank or person hereunder or the amount of
principal of or the rate at which interest is payable on the Loans in which
such participating bank or person has an interest, extending any scheduled
principal payment date or date fixed for the payment of interest on the Loans
in which such participating bank or person has an interest, increasing or extending
the Commitments in which such participating bank or person has an interest or
releasing all or substantially all of the value of the Guarantees (other than
in connection with the sale of such Guarantor in a transaction permitted by Section 6.05)
or all or substantially all of the Collateral) and (v) such Lender, acting
solely for this purpose as an agent of the Borrower, shall maintain a register
for the recordation of the names and addresses of the participating bank or
other person and the Commitments of and principal amounts of and interest on
the Loans owing and paid to, such participating banks pursuant to the terms
hereof from time to time and the amounts received by such Lender from the
Borrower and whether such amounts constitute principal interest fees or other
amounts and each participating bank’s share thereof.


 


(g)   Any Lender or participant may, in connection with
any assignment or participation or proposed assignment or participation
pursuant to this Section 9.04, disclose to the assignee or participant or
proposed assignee or participant any information relating to the Borrower
furnished to such Lender by or on behalf of the Borrower; provided that, prior to any such
disclosure of information designated by the Borrower as confidential, each such
assignee or participant or proposed assignee or participant shall execute an
agreement whereby such assignee or participant shall agree (subject to


 


76

















 


customary exceptions) to
preserve the confidentiality of such confidential information on terms no less
restrictive than those applicable to the Lenders pursuant to Section 9.16.


 


(h)   Any
Lender may at any time assign all or any portion of its rights under this
Agreement to secure extensions of credit to such Lender or in support of
obligations owed by such Lender; provided that
no such assignment shall release a Lender from any of its obligations hereunder
or substitute any such assignee for such Lender as a party hereto.


 


(i)   Notwithstanding
anything to the contrary contained herein, any Lender (a “Granting Lender”)  may
grant to a special purpose funding vehicle (an “SPC”), identified as
such in writing from time to time by the Granting Lender to the Administrative
Agent and the Borrower, the option to provide to the Borrower all or any part
of any Loan that such Granting Lender would otherwise be obligated to make to
the Borrower pursuant to this Agreement; provided
that (i) nothing herein shall constitute a commitment by any
SPC to make any Loan and (ii) if an SPC elects not to exercise such option
or otherwise fails to provide all or any part of such Loan, the Granting Lender
shall be obligated to make such Loan pursuant to the terms hereof. The making
of a Loan by an SPC hereunder shall utilize the Commitment of the Granting
Lender to the same extent, and as if, such Loan were made by such Granting
Lender. Each party hereto hereby agrees that no SPC shall be liable for any
indemnity or similar payment obligation under this Agreement (all liability for
which shall remain with the Granting Lender). In furtherance of the foregoing,
each party hereto hereby agrees (which agreement shall survive the termination
of this Agreement) that, prior to the date that is one year and one day after
the payment in full of all outstanding commercial paper or other senior
indebtedness of any SPC, it will not institute against, or join any other
person in instituting against, such SPC any bankruptcy, reorganization,
arrangement, insolvency or liquidation proceedings under the laws of the United
States or any State thereof. In addition, notwithstanding anything to the
contrary contained in this Section 9.04, any SPC may (i) with notice
to, but without the prior written consent of, the Borrower and the
Administrative Agent and without paying any processing fee therefor, assign all
or a portion of its interests in any Loans to the Granting Lender or to any
financial institutions (consented to by the Borrower and Administrative Agent)
providing liquidity and/or credit support to or for the account of such SPC to
support the funding or maintenance of Loans and (ii) disclose on a
confidential basis any non-public information relating to its Loans to any
rating agency, commercial paper dealer or provider of any surety, guarantee or
credit or liquidity enhancement to such SPC.


 


(j)   Neither
Holdings nor the Borrower shall assign or delegate any of its rights or duties
hereunder without the prior written consent of the Administrative Agent and
each Lender, and any attempted assignment without such consent shall be null
and void.


 


SECTION 9.05.
Expenses; Indemnity.  (a) The Borrower agrees to pay all
reasonable and documented out-of-pocket expenses incurred by the Administrative
Agent and the Collateral Agent in connection with the syndication of the Credit
Facility and the preparation and administration of this Agreement and the other
Loan Documents or in connection with any amendments, modifications or waivers
of the provisions hereof or


 


77

















 


thereof (whether or not
the transactions hereby or thereby contemplated shall be consummated) or
incurred by the Administrative Agent, the Collateral Agent or any Lender in
connection with the enforcement or protection of its rights in connection with
this Agreement and the other Loan Documents or in connection with the Loans
made hereunder, including the reasonable and documented fees, charges and
disbursements of Cravath, Swaine & Moore LLP, counsel for the
Administrative Agent and the Collateral Agent, and, in connection with any such
enforcement or protection, the fees, charges and disbursements of any other
counsel for the Administrative Agent, the Collateral Agent or any Lender.


 


(b)   The Borrower agrees to indemnify the
Administrative Agent, the Collateral Agent, each Lender and each Related Party
of any of the foregoing persons, their successors and assigns and members of
each of the foregoing (each such person being called an “Indemnitee”)  against, and to hold each Indemnitee
harmless from, any and all reasonable and documented losses, claims, damages,
liabilities and related expenses, including reasonable counsel fees, charges
and disbursements, incurred by or asserted against any Indemnitee arising out
of, in any way connected with, or as a result of (i) the execution or
delivery of this Agreement or any other Loan Document or any agreement or
instrument contemplated thereby, the performance by the parties thereto of
their respective obligations thereunder or the consummation of the Transactions
and the other transactions contemplated thereby (including the syndication of
the Credit Facility), (ii) the use of the proceeds of the Loans, or (iii) any
claim, litigation, investigation or proceeding relating to any of the
foregoing, whether or not any Indemnitee is a party thereto (and regardless of
whether such matter is initiated by a third party or by the Borrower, any other
Loan Party or any of their respective Affiliates); 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 wilful misconduct of such Indemnitee or (y) result
from the release of Hazardous Materials or a violation of Environmental Laws
that first occurs at a particular owned real property after such property has
been transferred to any Indemnitees or its successor or assigns by foreclosure,
deed-in-lieu of foreclosure or similar transfer except to the extent caused by,
or attributable to the actions of or failure to act by, the Borrower or any of
its Subsidiaries.


 


(c)   To the extent that the Borrower fails to pay any
amount required to be paid by it to the Administrative Agent or the Collateral
Agent under paragraph (a) or (b) of this Section, each Lender
severally agrees to pay to the Administrative Agent or the Collateral Agent, as
the case may be, such Lender’s pro rata share (determined as of the time that
the applicable unreimbursed expense or indemnity payment is sought) of such
unpaid amount; provided that the
unreimbursed expense or indemnified loss, claim, damage, liability or related
expense, as the case may be, was incurred by or asserted against the
Administrative Agent or the Collateral Agent in its capacity as such. For
purposes hereof, a Lender’s “pro rata share” shall be determined based upon its
share of the sum of the outstanding Loans and unused Commitments at the time.


 


78














 


(d)  To the 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 or any agreement or instrument contemplated
hereby, the Transactions, any Loan or the use of the proceeds thereof.


 


(e)  The provisions of this Section 9.05 shall remain
operative and in full force and effect regardless of the expiration of the term
of this Agreement, the consummation of the transactions contemplated hereby,
the repayment of any of the Loans, the expiration of the Commitments, the
invalidity or unenforceability of any term or provision of this Agreement or
any other Loan Document, or any investigation made by or on behalf of the
Administrative Agent, the Collateral Agent or any Lender. All amounts due under
this Section 9.05 shall be payable on written demand therefor.


 


SECTION 9.06.
Right of Setoff.  If an Event of Default shall have
occurred and be continuing, each Lender is hereby authorized at any time and
from time to time, except to the extent prohibited by law, to set off and apply
any and all deposits (general or special, time or demand, provisional or final)
at any time held and other indebtedness at any time owing by such Lender to or
for the credit or the account of the Borrower or Holdings against any of and
all the obligations of the Borrower or Holdings now or hereafter existing under
this Agreement and other Loan Documents held by such Lender, irrespective of
whether or not such Lender shall have made any demand under this Agreement or
such other Loan Document and although such obligations may be unmatured. The
rights of each Lender under this Section 9.06 are in addition to other
rights and remedies (including other rights of setoff) which such Lender may
have.


 


SECTION 9.07.
Applicable Law.  THIS AGREEMENT AND THE OTHER LOAN
DOCUMENTS (OTHER THAN LETTERS OF CREDIT AND AS EXPRESSLY SET FORTH IN OTHER LOAN
DOCUMENTS) SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF
THE STATE OF NEW YORK.


 


SECTION 9.08.
Waivers; Amendment.  (a) No failure or delay of the
Administrative Agent, the Collateral Agent or any Lender in exercising any
power or right hereunder or under any other Loan Document shall operate as a
waiver thereof, nor shall any single or partial exercise of any such right or
power, or any abandonment or discontinuance of steps to enforce such a right or
power, preclude any other or further exercise thereof or the exercise of any
other right or power. The rights and remedies of the Administrative Agent, the
Collateral Agent and the Lenders hereunder and under the other Loan Documents
are cumulative and are not exclusive of any rights or remedies that they would
otherwise have. No waiver of any provision of this Agreement or any other Loan
Document or consent to any departure by the Borrower or any other Loan Party
therefrom shall in any event be effective unless the same shall be permitted by
paragraph (b) below, and then such waiver or consent shall be effective
only in the specific instance and for the purpose for which given.   No notice or demand on the


 


79

















 


Borrower or Holdings in
any case shall entitle the Borrower or Holdings to any other or further notice
or demand in similar or other circumstances.


 


(b)  Neither
this Agreement nor any provision hereof may be waived, amended or modified except
pursuant to an agreement or agreements in writing entered into by the Borrower,
Holdings and the Required Lenders; provided,
however, that no such agreement shall (i) decrease the
principal amount of, or extend the maturity of or any scheduled principal
payment date or date for the payment of any interest on any Loan, or waive or
excuse any such payment or any part thereof, or decrease the rate of interest
on any Loan, without the prior written consent of each Lender directly
adversely affected thereby, (ii) increase or extend the Commitment or
decrease or extend the date for payment of any fees of any Lender without the
prior written consent of such Lender, (iii) amend or modify the pro rata
requirements of Section 2.16, the provisions of Section 9.04(j) or
the provisions of this Section or release all or substantially all of the
value of the Guarantees (other than in connection with the sale of such
Guarantor in a transaction permitted by Section 6.05) or all or
substantially all of the Collateral (except as provided in the Intercreditor
Agreement), without the prior written consent of each Lender, (iv) change
the provisions of any Loan Document in a manner that by its terms adversely
affects the rights in respect of payments due to Lenders holding Loans of one Class differently
from the rights of Lenders holding Loans of any other Class without the
prior written consent of Lenders holding a majority in interest of the
outstanding Loans and unused Commitments of each adversely affected Class, (v) modify
the protections afforded to an SPC pursuant to the provisions of Section 9.04(i) without
the written consent of such SPC or (vi) reduce the percentage contained in
the definition of the term “Required Lenders” without the prior written consent
of each Lender (it being understood that with the consent of the Required
Lenders, additional extensions of credit pursuant to this Agreement may be
included in the determination of the Required Lenders on substantially the same
basis as the Commitments on the date hereof); provided
further that no such agreement shall amend, modify or otherwise
affect the rights or duties of the Administrative Agent or the Collateral Agent
hereunder or under any other Loan Document without the prior written consent of
the Administrative Agent or the Collateral Agent.


 


SECTION 9.09.
Interest Rate Limitation. Notwithstanding
anything herein to the contrary, if at any time the interest rate applicable to
any Loan, together with all fees, charges and other amounts which are treated
as interest on such Loan under applicable law (collectively the “Charges”), shall exceed the maximum lawful rate
(the “Maximum Rate”) which may be contracted for, charged,
taken, received or reserved by the Lender holding such Loan in accordance with
applicable law, the rate of interest payable in respect of such Loan or
participation hereunder, together with all Charges payable in respect thereof,
shall be limited to the Maximum Rate and, to the extent lawful, the interest
and Charges that would have been payable in respect of such Loan or
participation but were not payable as a result of the operation of this Section 9.09
shall be cumulated and the interest and Charges payable to such Lender in
respect of other Loans or participations or periods shall be increased (but not
above the Maximum Rate therefor) until such cumulated amount, together with
interest thereon at the Federal Funds Effective Rate to the date of repayment,
shall have been received by such Lender.


 


80

















 


SECTION 9.10.
Entire  Agreement.
This Agreement, the Fee Letter and the other Loan Documents
constitute the entire contract between the parties relative to the subject
matter hereof. Any other previous agreement among the parties with respect to
the subject matter hereof is superseded by this Agreement and the other Loan
Documents. Nothing in this Agreement or in the other Loan Documents, expressed
or implied, is intended to confer upon any person (other than the parties
hereto and thereto, their respective successors and assigns permitted hereunder
and, to the extent expressly contemplated hereby, the Related Parties of each
of the Administrative Agent, the Collateral Agent and the Lenders) any rights,
remedies, obligations or liabilities under or by reason of this Agreement or
the other Loan Documents.


 


SECTION 9.11. WAIVER
OF JURY TRIAL.  EACH
PARTY HERETO HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW,
ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION
DIRECTLY OR INDIRECTLY ARIS1NG OUT OF, UNDER OR IN CONNECTION WITH THIS
AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS. EACH PARTY HERETO (A) CERTIFIES
THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED,
EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF
LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT
IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT
AND THE OTHER LOAN DOCUMENTS, AS APPLICABLE, BY, AMONG OTHER THINGS, THE MUTUAL
WAIVERS AND CERTIFICATIONS IN THIS SECTION 9.11.


 


SECTION 9.12.
Severability.  In the event any one or more of the
provisions contained in this Agreement or in any other Loan Document should be
held invalid, illegal or unenforceable in any respect, the validity, legality
and enforceability of the remaining provisions contained herein and therein
shall not in any way be affected or impaired thereby (it being understood that
the invalidity of a particular provision in a particular jurisdiction shall not
in and of itself affect the validity of such provision in any other
jurisdiction). The parties shall endeavor in good-faith negotiations to replace
the invalid, illegal or unenforceable provisions with valid provisions the
economic effect of which comes as close as possible to that of the invalid,
illegal or unenforceable provisions.


 


SECTION 9.13.
Counterparts. This Agreement may be executed in
counterparts (and by different parties hereto on different counterparts), each
of which shall constitute an original but all of which when taken together
shall constitute a single contract, and shall become effective as provided in Section 9.03.
Delivery of an executed signature page to this Agreement by facsimile
transmission shall be as effective as delivery of a manually signed counterpart
of this Agreement.


 


SECTION 9.14.
Headings.  Article and Section headings
and the Table of Contents used herein are for convenience of reference only,
are not part of this


 


81

















 


Agreement and are not to
affect the construction of, or to be taken into consideration in interpreting,
this Agreement.


 


SECTION 9.15.
Jurisdiction; Consent to Service
of Process.  (a) Each
party hereto hereby irrevocably and unconditionally submits, for itself and its
property, to the exclusive jurisdiction of any New York State court or Federal
court of the United States of America sitting in New York City, and any
appellate court from any thereof, in any action or proceeding arising out of or
relating to this Agreement or the other Loan Documents, or for recognition or
enforcement of any judgment, and each of the parties hereto hereby irrevocably
and unconditionally agrees that all claims in respect of any such action or
proceeding may be heard and determined in such New York State or, to the extent
permitted by law, in such Federal court. Each of the parties hereto agrees that
a final judgment in any such action or proceeding shall be conclusive and may
be enforced in other jurisdictions by suit on the judgment or in any other
manner provided by law. Nothing in this Agreement shall affect any right that
any party hereto may otherwise have to bring any action or proceeding relating
to this Agreement or the other Loan Documents against any other party hereto or
their respective properties in the courts of any jurisdiction.


 


(b)  Each party hereto hereby irrevocably and unconditionally
waives, to the fullest extent it may legally and effectively do so, any
objection which it may now or hereafter have to the laying of venue of any
suit, action or proceeding arising out of or relating to this Agreement or the
other Loan Documents in any New York State or Federal court. Each of the
parties hereto hereby irrevocably waives, to the fullest extent permitted by
law, the defense of an inconvenient forum to the maintenance of such action or
proceeding in any such court.


 


(c)  Each party to this Agreement irrevocably consents to
service of process in the manner provided for notices in Section 9.01.
Nothing in this Agreement will affect the right of any party to this Agreement
to serve process in any other manner permitted by law.


 


SECTION 9.16.
Confidentiality.  Each of the Administrative Agent, the
Collateral Agent and the Lenders agrees to maintain the confidentiality of the
Information (as defined below), except that Information may be disclosed (a) to
its and its Affiliates’ officers, directors, employees and agents, including
accountants, legal counsel and other advisors (it being understood that the
persons to whom such disclosure is made will be informed of the confidential
nature of such Information and instructed to keep such Information
confidential), (b) upon notice to the Borrower (to the extent practicable
and permitted under applicable laws or regulations), to the extent requested by
any regulatory authority or quasi-regulatory authority (such as the National
Association of Insurance Commissioners), (c) upon notice to the Borrower
(to the extent practicable and permitted under applicable laws or regulations),
to the extent required by applicable laws or regulations or by any subpoena or
similar legal process, (d) in connection with the exercise of any remedies
hereunder or under the other Loan Documents or any suit, action or proceeding
relating to the enforcement of its rights hereunder or thereunder, (e) subject
to an agreement containing provisions substantially the same as those of this


 


82

















 


Section 9.16, to (i) any
actual or prospective assignee of or participant in any of its rights or
obligations under this Agreement and the other Loan Documents or (ii) any
actual or prospective counterparty (or its advisors) to any swap or derivative
transaction relating to the Borrower or any Subsidiary or any of their
respective obligations, (f) with the consent of the Borrower or (g) to
the extent such Information becomes publicly available other than as a result
of a breach of this Section 9.16. For the purposes of this Section, “Information” shall
mean all information received from the Borrower or Holdings and related to the
Borrower or Holdings or their business, other than any such information that
was available to the Administrative Agent, the Collateral Agent or any Lender
on a nonconfidential basis prior to its disclosure by the Borrower or Holdings.
Any person required to maintain the confidentiality of Information as provided
in this Section 9.16 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
its own confidential information.


 


SECTION 9.17.
USA PATRIOT Act Notice.  Each Lender and the Administrative Agent
(for itself and not on behalf of any Lender) hereby notifies Holdings and the
Borrower that pursuant to the requirements of the USA PATRIOT Act, it is
required to obtain, verify and record information that identifies Holdings and
the Borrower, which information includes the name and address of Holdings and
the Borrower and other information that will allow such Lender or the
Administrative Agent, as applicable, to identify Holdings and the Borrower in
accordance with the USA PATRIOT Act.


 


SECTION 9.18. Intercreditor Agreement. Reference
is made to the Intercreditor Agreement. Each Lender hereunder (a) acknowledges
that it has received a copy of the Intercreditor Agreement, (b) consents
to the subordination of Liens provided for in the Intercreditor Agreement, (c) agrees
that it will be bound by and will take no actions contrary to the provisions of
the Intercreditor Agreement and (d) authorizes and instructs the
Collateral Agent to enter into the Intercreditor Agreement as Collateral Agent
and on behalf of such Lender. The foregoing provisions are intended as an
inducement to the lenders under the First Lien Credit Agreement to permit the
incurrence of Indebtedness under this Agreement and to extend credit to the
Borrower and such lenders are intended third party beneficiaries of such
provisions.


 


83

















 


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


 


	
   

  	
  STR ACQUISITION, INC.,

  
	
   

  	
   

  
	
   

  	
   

  	
  by

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  /s/ Jason Metakis

  
	
   

  	
   

  	
  Name: Jason Metakis

  
	
   

  	
   

  	
  Title:
  Treasurer

  
	
   

  	
   

  
	
   

  	
  STR HOLDINGS LLC,

  
	
   

  	
   

  
	
   

  	
   

  	
  by

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  /s/ Jason Metakis

  
	
   

  	
   

  	
  Name: Jason Metakis

  
	
   

  	
   

  	
  Title: Treasurer

  
				



 

















 


	
   

  	
  CREDIT SUISSE, CAYMAN ISLANDS

  BRANCH, individually and as

  Administrative Agent and Collateral Agent,

  
	
   

  	
   

  
	
   

  	
   

  	
  by

  
	
   

  	
   

  
	
   

  	
   

  	
  /s/ Shanka Mohan

  
	
   

  	
   

  	
  Name: Shanka Mohan

  
	
   

  	
   

  	
  Title: Vice President

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  by

  
	
   

  	
   

  
	
   

  	
   

  	
  /s/ James Neira

  
	
   

  	
   

  	
  Name: James Neira

  
	
   

  	
   

  	
  Title: Associate