Exhibit 10.1


 




 





$240,000,000


 


THIRD
AMENDED AND RESTATED CREDIT AGREEMENT


 


dated as
of October 3, 2003,


 


Amended
and Restated as of December 15, 2005,


 


among


 


BASIC
ENERGY SERVICES, INC., a Delaware corporation,

as Borrower,


 


THE SUBSIDIARY
GUARANTORS PARTY HERETO,

as Subsidiary Guarantors,


 


THE
LENDERS PARTY HERETO,


 


and


 


BANK OF
AMERICA, N.A.,

as Syndication Agent,


 


HIBERNIA
NATIONAL BANK,


as Co-Documentation
Agent,


 


BNP
PARIBAS,

as Co-Documentation Agent,


 


and


 


UBS AG,
STAMFORD BRANCH,

as Issuing Bank, Administrative Agent and Collateral Agent


 










 


UBS
SECURITIES LLC



Sole Lead Arranger and Bookrunner


 










 


Cahill Gordon & Reindel LLP

80 Pine Street

New York, New York 10005




 





 





















 


TABLE OF CONTENTS


 


	
   

  	
  Page

  
	
   

  
	
  ARTICLE I

  
	
   

  
	
  DEFINITIONS

  
	
   

  
	
  SECTION 1.01.

  	
   

  	
  Defined Terms

  	
  2

  	
   

  
	
  SECTION 1.02.

  	
   

  	
  Classification of Loans and Borrowings

  	
  27

  	
   

  
	
  SECTION 1.03.

  	
   

  	
  Terms Generally

  	
  27

  	
   

  
	
  SECTION 1.04.

  	
   

  	
  Accounting Terms; GAAP

  	
  27

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE II

  
	
   

  
	
  THE CREDITS

  
	
   

  
	
  SECTION 2.01.

  	
   

  	
  Commitments

  	
   

  	
  27

  	
   

  
	
  SECTION 2.02.

  	
   

  	
  Loans

  	
   

  	
  28

  	
   

  
	
  SECTION 2.03.

  	
   

  	
  Borrowing Procedure

  	
   

  	
  29

  	
   

  
	
  SECTION 2.04.

  	
   

  	
  Evidence of Debt; Repayment of Loans

  	
   

  	
  29

  	
   

  
	
  SECTION 2.05.

  	
   

  	
  Fees

  	
   

  	
  30

  	
   

  
	
  SECTION 2.06.

  	
   

  	
  Interest on Loans

  	
   

  	
  31

  	
   

  
	
  SECTION 2.07.

  	
   

  	
  Termination and Reduction of Commitments

  	
   

  	
  32

  	
   

  
	
  SECTION 2.08.

  	
   

  	
  Interest Elections

  	
   

  	
  32

  	
   

  
	
  SECTION 2.09.

  	
   

  	
  Amortization of Term B Borrowings

  	
   

  	
  33

  	
   

  
	
  SECTION 2.10.

  	
   

  	
  Optional and Mandatory Prepayments of Loans

  	
   

  	
  34

  	
   

  
	
  SECTION 2.11.

  	
   

  	
  Alternate Rate of Interest

  	
   

  	
  37

  	
   

  
	
  SECTION 2.12.

  	
   

  	
  Increased Costs

  	
   

  	
  37

  	
   

  
	
  SECTION 2.13.

  	
   

  	
  Breakage Payments

  	
   

  	
  38

  	
   

  
	
  SECTION 2.14.

  	
   

  	
  Payments Generally; Pro Rata Treatment;
  Sharing of Setoffs

  	
   

  	
  39

  	
   

  
	
  SECTION 2.15.

  	
   

  	
  Taxes

  	
   

  	
  40

  	
   

  
	
  SECTION 2.16.

  	
   

  	
  Mitigation Obligations; Replacement of
  Lenders

  	
   

  	
  41

  	
   

  
	
  SECTION 2.17.

  	
   

  	
  Swingline Loans

  	
   

  	
  42

  	
   

  
	
  SECTION 2.18.

  	
   

  	
  Letters of Credit

  	
   

  	
  43

  	
   

  
	
  SECTION 2.19.

  	
   

  	
  [Intentionally omitted]

  	
   

  	
  49

  	
   

  
	
  SECTION 2.20.

  	
   

  	
  [Intentionally omitted]

  	
   

  	
  49

  	
   

  
	
  SECTION 2.21.

  	
   

  	
  [Intentionally omitted]

  	
   

  	
  49

  	
   

  
	
  SECTION 2.22.

  	
   

  	
  Increase in Commitments

  	
   

  	
  49

  	
   

  
	
  SECTION 2.23.

  	
   

  	
  Term B Loans and Revolving Loans

  	
   

  	
  51

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE III

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  REPRESENTATIONS AND WARRANTIES

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SECTION 3.01.

  	
   

  	
  Organization; Powers

  	
   

  	
  52

  	
   

  
	
  SECTION 3.02.

  	
   

  	
  Authorization; Enforceability

  	
   

  	
  52

  	
   

  
	
  SECTION 3.03.

  	
   

  	
  Governmental Approvals; No Conflicts

  	
   

  	
  52

  	
   

  
	
  SECTION 3.04.

  	
   

  	
  Financial Statements

  	
   

  	
  52

  	
   

  
	
  SECTION 3.05.

  	
   

  	
  No Claims

  	
   

  	
  53

  	
   

  



 


i





















 


	
   

  	
   

  	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SECTION 3.06.

  	
   

  	
  Properties

  	
   

  	
  53

  	
   

  
	
  SECTION 3.07.

  	
   

  	
  Intellectual Property

  	
   

  	
  53

  	
   

  
	
  SECTION 3.08.

  	
   

  	
  Condition and Maintenance of Equipment

  	
   

  	
  54

  	
   

  
	
  SECTION 3.09.

  	
   

  	
  Equity Interests and Subsidiaries

  	
   

  	
  54

  	
   

  
	
  SECTION 3.10.

  	
   

  	
  Litigation; Compliance with Laws

  	
   

  	
  55

  	
   

  
	
  SECTION 3.11.

  	
   

  	
  Agreements

  	
   

  	
  55

  	
   

  
	
  SECTION 3.12.

  	
   

  	
  Federal Reserve Regulations

  	
   

  	
  56

  	
   

  
	
  SECTION 3.13.

  	
   

  	
  Investment Company Act; Public Utility
  Holding Company Act

  	
   

  	
  56

  	
   

  
	
  SECTION 3.14.

  	
   

  	
  Use of Proceeds

  	
   

  	
  56

  	
   

  
	
  SECTION 3.15.

  	
   

  	
  Taxes

  	
   

  	
  56

  	
   

  
	
  SECTION 3.16.

  	
   

  	
  No Material Misstatements

  	
   

  	
  56

  	
   

  
	
  SECTION 3.17.

  	
   

  	
  Labor Matters

  	
   

  	
  56

  	
   

  
	
  SECTION 3.18.

  	
   

  	
  Solvency

  	
   

  	
  57

  	
   

  
	
  SECTION 3.19.

  	
   

  	
  Employee Benefit Plans

  	
   

  	
  57

  	
   

  
	
  SECTION 3.20.

  	
   

  	
  Environmental Matters

  	
   

  	
  57

  	
   

  
	
  SECTION 3.21.

  	
   

  	
  Insurance

  	
   

  	
  58

  	
   

  
	
  SECTION 3.22.

  	
   

  	
  Security Documents

  	
   

  	
  59

  	
   

  
	
  SECTION 3.23.

  	
   

  	
  No Material Adverse Effect

  	
   

  	
  59

  	
   

  
	
  SECTION 3.24.

  	
   

  	
  Anti-Terrorism Law

  	
   

  	
  59

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE IV

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  CONDITIONS TO CREDIT EXTENSIONS

  
	
   

  
	
  SECTION 4.01.

  	
   

  	
  Conditions to Initial Credit Extension

  	
   

  	
  60

  	
   

  
	
  SECTION 4.02.

  	
   

  	
  Conditions to All Credit Extensions

  	
   

  	
  65

  	
   

  
	
  SECTION 4.03.

  	
   

  	
  Intentionally omitted

  	
   

  	
  66

  	
   

  
	
  SECTION 4.04.

  	
   

  	
  Conditions to Effectiveness of the
  Amendment and Restatement

  	
   

  	
  66

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE V

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  AFFIRMATIVE COVENANTS

  
	
   

  
	
  SECTION 5.01.

  	
   

  	
  Financial Statements, Reports, etc.

  	
   

  	
  67

  	
   

  
	
  SECTION 5.02.

  	
   

  	
  Litigation and Other Notices

  	
   

  	
  69

  	
   

  
	
  SECTION 5.03.

  	
   

  	
  Existence; Businesses and Properties

  	
   

  	
  69

  	
   

  
	
  SECTION 5.04.

  	
   

  	
  Insurance

  	
   

  	
  70

  	
   

  
	
  SECTION 5.05.

  	
   

  	
  Obligations and Taxes

  	
   

  	
  70

  	
   

  
	
  SECTION 5.06.

  	
   

  	
  Employee Benefits

  	
   

  	
  71

  	
   

  
	
  SECTION 5.07.

  	
   

  	
  Maintaining Records; Access to Properties
  and Inspections

  	
   

  	
  71

  	
   

  
	
  SECTION 5.08.

  	
   

  	
  Use of Proceeds

  	
   

  	
  71

  	
   

  
	
  SECTION 5.09.

  	
   

  	
  Compliance with Environmental Laws;
  Environmental Reports

  	
   

  	
  71

  	
   

  
	
  SECTION 5.10.

  	
   

  	
  Interest Rate Protection

  	
   

  	
  72

  	
   

  
	
  SECTION 5.11.

  	
   

  	
  Additional Collateral; Additional
  Guarantors

  	
   

  	
  72

  	
   

  
	
  SECTION 5.12.

  	
   

  	
  Security Interests; Further Assurances

  	
   

  	
  73

  	
   

  
	
  SECTION 5.13.

  	
   

  	
  Information Regarding Collateral

  	
   

  	
  73

  	
   

  



 


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  Page

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE VI

  
	
   

  
	
  NEGATIVE COVENANTS

  
	
   

  
	
  SECTION 6.01.

  	
   

  	
  Indebtedness

  	
   

  	
  74

  	
   

  
	
  SECTION 6.02.

  	
   

  	
  Liens

  	
   

  	
  75

  	
   

  
	
  SECTION 6.03.

  	
   

  	
  Sale and Leaseback Transactions

  	
   

  	
  77

  	
   

  
	
  SECTION 6.04.

  	
   

  	
  Investment, Loan and Advances

  	
   

  	
  77

  	
   

  
	
  SECTION 6.05.

  	
   

  	
  Mergers, Consolidations, Sales of Assets
  and Acquisitions

  	
   

  	
  78

  	
   

  
	
  SECTION 6.06.

  	
   

  	
  Dividends

  	
   

  	
  79

  	
   

  
	
  SECTION 6.07.

  	
   

  	
  Transactions with Affiliates

  	
   

  	
  80

  	
   

  
	
  SECTION 6.08.

  	
   

  	
  Financial Covenants

  	
   

  	
  80

  	
   

  
	
  SECTION 6.09.

  	
   

  	
  Limitation on Modifications or Prepayment of Indebtedness;
  Modifications of Certificate of Incorporation, or Other Constitutive Documents,
  By laws and Certain Other Agreements, etc.

  	
   

  	
  81

  	
   

  
	
  SECTION 6.10.

  	
   

  	
  Limitation on Certain Restrictions on
  Subsidiaries

  	
   

  	
  81

  	
   

  
	
  SECTION 6.11.

  	
   

  	
  Limitation on Issuance of Capital Stock

  	
   

  	
  82

  	
   

  
	
  SECTION 6.12.

  	
   

  	
  Limitation on Creation of Subsidiaries

  	
   

  	
  82

  	
   

  
	
  SECTION 6.13.

  	
   

  	
  Business

  	
   

  	
  82

  	
   

  
	
  SECTION 6.14.

  	
   

  	
  Limitation on Accounting Changes

  	
   

  	
  82

  	
   

  
	
  SECTION 6.15.

  	
   

  	
  Fiscal Year

  	
   

  	
  82

  	
   

  
	
  SECTION 6.16.

  	
   

  	
  Lease Obligations

  	
   

  	
  82

  	
   

  
	
  SECTION 6.17.

  	
   

  	
  Limitation on Further Negative Pledges

  	
   

  	
  82

  	
   

  
	
  SECTION 6.18.

  	
   

  	
  Anti-Terrorism Law; Anti-Money Laundering

  	
   

  	
  83

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE VII

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  GUARANTEE

  
	
   

  
	
  SECTION 7.01.

  	
   

  	
  The Guarantee

  	
   

  	
  83

  	
   

  
	
  SECTION 7.02.

  	
   

  	
  Obligations Unconditional

  	
   

  	
  83

  	
   

  
	
  SECTION 7.03.

  	
   

  	
  Reinstatement

  	
   

  	
  85

  	
   

  
	
  SECTION 7.04.

  	
   

  	
  Subrogation; Subordination

  	
   

  	
  85

  	
   

  
	
  SECTION 7.05.

  	
   

  	
  Remedies

  	
   

  	
  85

  	
   

  
	
  SECTION 7.06.

  	
   

  	
  Instrument for the Payment of Money

  	
   

  	
  85

  	
   

  
	
  SECTION 7.07.

  	
   

  	
  Continuing Guarantee

  	
   

  	
  85

  	
   

  
	
  SECTION 7.08.

  	
   

  	
  General Limitation on Guarantee Obligations

  	
   

  	
  86

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE VIII

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  EVENTS OF DEFAULT

  
	
   

  
	
  SECTION 8.01.

  	
   

  	
  Events of Default

  	
   

  	
  86

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE IX

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  COLLATERAL ACCOUNT; APPLICATION OF
  COLLATERAL PROCEEDS

  
	
   

  
	
  SECTION 9.01.

  	
   

  	
  Collateral Account

  	
   

  	
  88

  	
   

  
	
  SECTION 9.02.

  	
   

  	
  Proceeds of Destruction, Taking and
  Collateral Dispositions

  	
   

  	
  89

  	
   

  



 


iii





















 


	
   

  	
   

  	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SECTION 9.03.

  	
   

  	
  Application of Proceeds

  	
   

  	
  89

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE X

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  THE ADMINISTRATIVE AGENT AND THE COLLATERAL
  AGENT

  
	
   

  
	
  SECTION 10.01.

  	
   

  	
  Appointment

  	
   

  	
  90

  	
   

  
	
  SECTION 10.02.

  	
   

  	
  Agent in Its Individual Capacity

  	
   

  	
  90

  	
   

  
	
  SECTION 10.03.

  	
   

  	
  Exculpatory Provisions

  	
   

  	
  90

  	
   

  
	
  SECTION 10.04.

  	
   

  	
  Reliance by Agent

  	
   

  	
  91

  	
   

  
	
  SECTION 10.05.

  	
   

  	
  Delegation of Duties

  	
   

  	
  91

  	
   

  
	
  SECTION 10.06.

  	
   

  	
  Successor Agent

  	
   

  	
  91

  	
   

  
	
  SECTION 10.07.

  	
   

  	
  Non Reliance on Agent and Other Lenders

  	
   

  	
  92

  	
   

  
	
  SECTION 10.08.

  	
   

  	
  No Other Administrative Agent

  	
   

  	
  92

  	
   

  
	
  SECTION 10.09.

  	
   

  	
  Indemnification

  	
   

  	
  92

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE XI

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  MISCELLANEOUS

  
	
   

  
	
  SECTION 11.01.

  	
   

  	
  Notices

  	
   

  	
  93

  	
   

  
	
  SECTION 11.02.

  	
   

  	
  Waivers; Amendment

  	
   

  	
  94

  	
   

  
	
  SECTION 11.03.

  	
   

  	
  Expenses; Indemnity

  	
   

  	
  96

  	
   

  
	
  SECTION 11.04.

  	
   

  	
  Successors and Assigns

  	
   

  	
  97

  	
   

  
	
  SECTION 11.05.

  	
   

  	
  Survival of Agreement

  	
   

  	
  99

  	
   

  
	
  SECTION 11.06.

  	
   

  	
  Counterparts; Integration; Effectiveness

  	
   

  	
  100

  	
   

  
	
  SECTION 11.07.

  	
   

  	
  Severability

  	
   

  	
  100

  	
   

  
	
  SECTION 11.08.

  	
   

  	
  Right of Setoff

  	
   

  	
  100

  	
   

  
	
  SECTION 11.09.

  	
   

  	
  Governing Law; Jurisdiction; Consent to
  Service of Process

  	
   

  	
  100

  	
   

  
	
  SECTION 11.10.

  	
   

  	
  Waiver of Jury Trial

  	
   

  	
  101

  	
   

  
	
  SECTION 11.11.

  	
   

  	
  Headings

  	
   

  	
  101

  	
   

  
	
  SECTION 11.12.

  	
   

  	
  Confidentiality

  	
   

  	
  101

  	
   

  
	
  SECTION 11.13.

  	
   

  	
  Interest Rate Limitation

  	
   

  	
  102

  	
   

  
	
  SECTION 11.14.

  	
   

  	
  Lender Addendum

  	
   

  	
  102

  	
   

  
	
  SECTION 11.15.

  	
   

  	
  Integration

  	
   

  	
  102

  	
   

  
	
  SECTION 11.16.

  	
   

  	
  USA PATRIOT Act Notice

  	
   

  	
  102

  	
   

  



 


iv





















 


	
  ANNEXES

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Annex I

  	
  Applicable Margin

  	
   

  	
   

  
	
  Annex II

  	
  Amortization Table

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  SCHEDULES

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Schedule 1.01(a)

  	
  Subsidiary Guarantors

  	
   

  	
   

  
	
  Schedule 3.03

  	
  Governmental Approvals; Compliance with
  Laws

  	
   

  	
   

  
	
  Schedule 3.06(b)

  	
  Real Property

  	
   

  	
   

  
	
  Schedule 3.07(c)

  	
  Violations or Proceedings

  	
   

  	
   

  
	
  Schedule 3.09(a)

  	
  Subsidiaries and Equity Interests Shares
  Issued and Outstanding

  	
   

  	
   

  
	
  Schedule 3.09(c)

  	
  Corporate Organizational Chart

  	
   

  	
   

  
	
  Schedule 3.11(c)

  	
  Material Agreements

  	
   

  	
   

  
	
  Schedule 3.20

  	
  Environmental Matters

  	
   

  	
   

  
	
  Schedule 3.21

  	
  Insurance

  	
   

  	
   

  
	
  Schedule 4.01(g)

  	
  Local Counsel

  	
   

  	
   

  
	
  Schedule 4.01(n)

  	
  Landlord Lien Waiver and Access Agreements

  	
   

  	
   

  
	
  Schedule 4.01(o)(iii)

  	
  Title Insurance Amounts

  	
   

  	
   

  
	
  Schedule 6.01(b)

  	
  Existing Indebtedness

  	
   

  	
   

  
	
  Schedule 6.02(c)

  	
  Existing Liens

  	
   

  	
   

  
	
  Schedule 6.04(b)

  	
  Existing Investments

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  EXHIBITS

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Exhibit A

  	
  Form of Administrative Questionnaire

  	
   

  	
   

  
	
  Exhibit B

  	
  Form of Assignment and Acceptance

  	
   

  	
   

  
	
  Exhibit C-1

  	
  Form of Borrowing Request

  	
   

  	
   

  
	
  Exhibit C-2

  	
  Form of LC Request

  	
   

  	
   

  
	
  Exhibit D

  	
  Form of Interest Election Request

  	
   

  	
   

  
	
  Exhibit E

  	
  Form of Joinder Agreement

  	
   

  	
   

  
	
  Exhibit F

  	
  Form of Landlord Lien Waiver, Access
  Agreement and Consent

  	
   

  	
   

  
	
  Exhibit G-1

  	
  Form of Original Term B Note

  	
   

  	
   

  
	
  Exhibit G-2

  	
  Form of Original Revolving Note

  	
   

  	
   

  
	
  Exhibit G-3

  	
  Form of Term B Note

  	
   

  	
   

  
	
  Exhibit G-4

  	
  Form of Revolving Note

  	
   

  	
   

  
	
  Exhibit G-5

  	
  Form of Swingline Note

  	
   

  	
   

  
	
  Exhibit H-1

  	
  Form of Perfection Certificate

  	
   

  	
   

  
	
  Exhibit H-2

  	
  Form of Perfection Certificate
  Supplement

  	
   

  	
   

  
	
  Exhibit I

  	
  Form of Security Agreement

  	
   

  	
   

  
	
  Exhibit J-1

  	
  Form of Opinion of Company Counsel

  	
   

  	
   

  
	
  Exhibit J-2

  	
  Form of Opinion of Local Counsel

  	
   

  	
   

  
	
  Exhibit K

  	
  Form of Intercompany Note

  	
   

  	
   

  
	
  Exhibit L

  	
  Form of Compliance Certificate

  	
   

  	
   

  
	
  Exhibit M

  	
  Form of Solvency Certificate

  	
   

  	
   

  
	
  Exhibit N

  	
  Form of Lender Addendum

  	
   

  	
   

  
	
  Exhibit O-1

  	
  Form of Additional Borrower Agreement

  	
   

  	
   

  
	
  Exhibit O-2

  	
  Form of Additional Borrower
  Termination Agreement

  	
   

  	
   

  
	
  Exhibit P

  	
  Confidential Lender Authorization

  	
   

  	
   

  



 


v





















 


THIRD
AMENDED AND RESTATED CREDIT AGREEMENT


 


This THIRD
AMENDED AND RESTATED CREDIT AGREEMENT (this “Agreement”)
dated as of October 3, 2003, amended and restated as of November 17,
2003, and December 31, 2004, and as further amended and restated as of December 15, 2005, among BASIC ENERGY SERVICES,
INC., a Delaware corporation (“Borrower”),
the SUBSIDIARY GUARANTORS PARTY HERETO, as the Subsidiary Guarantors (such term
and each other capitalized term used but not defined herein having the meaning
given to it in Article I), the Lenders, UBS LOAN FINANCE LLC, as swingline
lender (in such capacity, “Swingline Lender”)
and as a Lender, BANK OF AMERICA, N.A., as syndication agent (in such capacity,
“Syndication Agent”), HIBERNIA NATIONAL
BANK, as co-documentation agent (in such capacity, a “Documentation Agent”) , BNP PARIBAS, as
co-documentation (in such capacity, a “Documentation Agent”)
and UBS AG, STAMFORD BRANCH, as issuing bank (in such capacity, “Issuing Bank”), as administrative agent (in
such capacity, “Administrative Agent”)
for the Lenders and as collateral agent (in such capacity, “Collateral Agent”) for the Secured Parties
and the Issuing Bank.


 


WITNESSETH:


 


WHEREAS, this
Agreement was originally entered into on October 3, 2003 (the “Original Credit Agreement”) and amended and
restated on each of November 17, 2003 and December 31, 2004, and the
parties hereto desire to further amend and restate this Agreement as herein set
forth;


 


WHEREAS, Borrower
desires to create (i) a new Class of Term Loans under this Agreement
in an aggregate principal amount of $90.0 million, having terms identical to
the Original Term B Loans and having the same rights and obligations as the
Original Term B Loans as set forth in this Agreement and the other Loan
Documents and (ii) a new Class of Revolving Loans under this
Agreement in an aggregate principal amount of $150.0 million, having terms
identical to the Original Revolving Loans and having the same rights and
obligations as the Original Revolving Loans as set forth in this Agreement and
the other Loan Documents, except in each case, as set forth herein;


 


WHEREAS, each
Original Lender who holds Original Term B Loans (other than Reduced Lenders (as
defined below)) and who executes and delivers a counterpart of this Agreement
shall be deemed, upon effectiveness of this Agreement as amended and restated
on the date hereof (the “Third Amendment and
Restatement”), to have exchanged its Original Term B Loans (which
Original Term B Loans shall thereafter be deemed paid in full and
extinguished) for Term B Loans in equal outstanding principal amounts;


 


WHEREAS, each
Original Lender who holds outstanding Original Term B Loans in an amount
greater than its Term B Commitment (such Lender, a “Reduced Term Lender”) and who executes and delivers a
counterpart of this Agreement shall be deemed, upon effectiveness of this Agreement,
to have, upon the funding thereof, to have made Term B Loans in amount equal to
its Term B Commitment;


 


WHEREAS, each
Original Lender who holds Original Revolving Commitments (other than Reduced Lenders
(as defined below)) and who executes and delivers a counterpart of this
Agreement shall be deemed, upon effectiveness of this Agreement as amended and
restated on the Third Amendment and Restatement Date, to have exchanged its
Original Revolving Commitments (with respect to which any outstanding Original
Revolving Loans shall thereafter be deemed paid in full and extinguished and
which Original Revolving Commitments shall thereafter be deemed terminated) for
Revolving Commitments in equal outstanding principal amounts;


 





















 


WHEREAS, each
Original Lender who holds an Original Revolving Commitment in an amount greater
than its Revolving Commitment (such Lender, a “Reduced Revolving Lender” and, together with the Reduced Term
Lenders, the “Reduced Lenders”) and who executes
and delivers a counterpart of this Agreement shall be deemed, upon
effectiveness of this Agreement, to have made its Revolving Commitment;


 


WHEREAS, a
portion of the proceeds from the Term B Loans and Revolving Loans shall be
used on the Third Amendment and Restatement Effective Date (as defined below)
to repay the entire aggregate principal amount of the Original Term B
Loans and Original Revolving Loans held by Original Lenders who do not execute
and deliver a counterpart of this Agreement and to the Reduced Lenders in accordance
with Section 2.23 of this Agreement, together with accrued and unpaid
interest thereon to the Third Amendment and Restatement Effective Date;


 


WHEREAS, Borrower
further desires to amend and restate this Agreement to make other changes as
provided herein;


 


WHEREAS, the
proceeds of the Loans were or are to be used in accordance with Section 3.14;


 


NOW,
THEREFORE, the Lenders are willing to extend such credit to Borrower and the
Issuing Bank is willing to issue letters of credit for the account of 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, is used when such Loan, or the Loans comprising such Borrowing, are
bearing interest at a rate determined by reference to the Alternate Base Rate.


 


“ABR Borrowing” shall mean a Borrowing
comprised of ABR Loans.


 


“ABR Loan” shall mean any ABR Term Loan or
ABR Revolving Loan.


 


“ABR Revolving Borrowing” shall mean a
Borrowing comprised of ABR Revolving Loans.


 


“ABR Revolving Loan” shall mean any
Revolving Loan bearing interest at a rate determined by reference to the
Alternate Base Rate in accordance with the provisions of Article II.


 


“ABR Term Loan” shall mean any Term B Loan
bearing interest at a rate determined by reference to the Alternate Base Rate
in accordance with the provisions of Article II.


 


“Acquisition Consideration” shall mean the
purchase consideration for any Permitted Acquisition and all other payments by Borrower
or any of its Subsidiaries in exchange for, or as part of, or in connection
with, any Permitted Acquisition, whether paid in cash or by exchange of Equity
Interests or of assets or otherwise and whether payable at or prior to the
consummation of such Permitted Acquisition or deferred for payment at any
future time, whether or not any such future payment is subject to the occurrence
of any contingency, and includes any and all payments representing the purchase
price and any


 


2





















 


assumptions of
Indebtedness, “earn outs” and other agreements to make any payment the amount
of which is, or the terms of payment of which are, in any respect subject to or
contingent upon the revenues, income, cash flow or profits (or the like) of any
person or business.


 


“Adjusted LIBOR Rate” shall mean, with
respect to any Eurodollar Borrowing for any Interest Period, (a) an
interest rate per annum (rounded upward, if necessary, to the next 1/100th of
1%) determined by the Administrative Agent to be equal to the LIBOR Rate for
such Eurodollar Borrowing in effect for such Interest Period divided by (b) 1
minus the Statutory Reserves (if
any) for such Eurodollar Borrowing for such Interest Period.


 


“Administrative Agent” shall have the
meaning assigned to such term in the preamble hereto and includes each other
person appointed as the successor pursuant to Article X.


 


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


 


“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.


 


“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, for purposes of Section 6.07, the term “Affiliate” shall also
include any person that directly or indirectly owns more than 10% of any class
of Equity Interests of the person specified or that is an executive officer or
director of the person specified.


 


“Agents” shall mean the Arranger,
Documentation Agent, Syndication Agent, Administrative Agent and the Collateral
Agent.


 


“Agreement” shall have the meaning assigned
to such term in the preamble hereto.


 


“Alternate Base Rate” shall mean, for any
day, a rate per annum (rounded upward, if necessary, to the next 1/100th of 1%)
equal to the greater of (a) the Base Rate in effect on such day and (b) the
Federal Funds Effective Rate in effect on such day plus 0.50%.  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 Base Rate or the Federal Funds Effective Rate shall be
effective on the effective date of such change in the Base Rate or the Federal
Funds Effective Rate, respectively.


 


“Applicable Fee” shall mean, for any day,
with respect to any Term B Loan or Revolving Loan, as the case may be, the
applicable percentage set forth in Annex I under the caption “Applicable
Fee”.


 


“Applicable Margin” shall mean, for any day,
with respect to any Revolving Loan or Term B Loan, as the case may be, the
applicable percentage set forth in Annex I under the appropriate
caption.


 


“Arranger” shall mean UBS Securities LLC.


 


“Asset Sale” shall mean (a) any
conveyance, sale, lease, sublease, assignment, transfer or other disposition
(including by way of merger or consolidation and including any sale and
leaseback transaction) of any property (including stock of any Subsidiary of Borrower
by the holder thereof) by Borrower


 


3





















 


or any of its
Subsidiaries to any person other than Borrower or any Subsidiary Guarantor and (b) any
issuance or sale by any Subsidiary of Borrower of its Equity Interests to any
person (other than to Borrower or any Subsidiary Guarantor).


 


“Assignment and Acceptance” shall mean an
assignment and acceptance entered into by a Lender or, if dated prior to the
Third Amendment and Restatement Effective Date, an Original 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 Indebtedness” shall mean, when
used with respect to any sale and leaseback transaction, as at the time of
determination, the present value (discounted at a rate equivalent to Borrower’s
then current weighted average cost of funds for borrowed money as at the time
of determination, compounded on a semi annual basis) of the total obligations
of the lessee for rental payments during the remaining term of the lease included
in any such sale and leaseback transaction.


 


“Base Rate” shall mean, for any day, a rate
per annum that is equal to the corporate base rate of interest established by
the Administrative Agent from time to time; each change in the Base Rate shall
be effective on the date such change is effective.  The corporate base rate is not necessarily
the lowest rate charged by the Administrative Agent to its customers.


 


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


 


“Borrower” shall have the meaning assigned
to such term in the preamble hereto.


 


“Borrowing” shall mean (a) Loans of the
same Class and 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, or (b) a Swingline Loan.


 


“Borrowing Request” shall mean a request by Borrower
in accordance with the terms of Section 2.03 and substantially in
the form of Exhibit C-1, or such other form as shall be approved by
the Administrative Agent.


 


“Business Day” shall mean any day other than
a Saturday, Sunday or other 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, with
respect to any person, for any period, the aggregate amount of all expenditures
by such person and its Subsidiaries during that period for fixed or capital assets
or improvements thereto or replacements thereof that, in accordance with GAAP,
are or should be classified as capital expenditures in the consolidated
statement of cash flows of such person and its Consolidated Subsidiaries; provided, however, that
Capital Expenditures shall not include (x) expenditures made in connection with
any Permitted Acquisition or (y) expenditures by any person prior to the time
such person was acquired pursuant to a Permitted Acquisition.


 


“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.


 


4





















 


“Cash Equivalents” shall mean, as to any
person:  (a) securities issued, or
directly, unconditionally and fully guaranteed or insured, by the United States
or any agency or instrumentality thereof (provided
that the full faith and credit of the United States is pledged in support
thereof) having maturities of not more than one year from the date of
acquisition by such person; (b) time deposits and certificates of deposit
of any Lender or any commercial bank having, or which is the principal banking
subsidiary of a bank holding company organized under the laws of the United
States, any state thereof or the District of Columbia having, capital and
surplus aggregating in excess of $300.0 million and a rating of “A” (or such
other similar equivalent rating) or higher by at least one nationally
recognized statistical rating organization (as defined in Rule 436 under
the Securities Act) with maturities of not more than one year from the date of
acquisition by such person; (c) repurchase obligations with a term of not
more than 30 days for underlying securities of the types described in clause (a) above
entered into with any bank meeting the qualifications specified in clause (b) above,
which repurchase obligations are secured by a valid perfected security interest
in the underlying securities; (d) commercial paper issued by any person
incorporated in the United States rated at least A-1 or the equivalent thereof
by Standard & Poor’s Rating Service (“S&P”) or at least P-1 or the equivalent thereof by Moody’s
Investors Service, Inc. (“Moody’s”)
or an equivalent rating by a nationally recognized rating agency if both
S&P and Moody’s cease publishing ratings of commercial paper issuers
generally, and in each case maturing not more than one year after the date of
acquisition by such person; (e) investments in money market funds
substantially all of whose assets are comprised of securities of the types
described in clauses (a) through (d) above; and (f) demand deposit
accounts maintained in the ordinary course of business.


 


“Casualty Event” shall mean, with respect to
any property (including Real Property) of any person, any loss of title with
respect to such property or any loss of or damage to or destruction of, or any
condemnation or other taking (including by any Governmental Authority) of, such
property for which such person or any of its Subsidiaries receives insurance
proceeds or proceeds of a condemnation award or other compensation in each case
to the extent that such proceeds or other compensation exceeds $250,000.  “Casualty Event” shall include but not be
limited to any taking of all or any part of any Real Property of any person or
any part thereof, in or by condemnation or other eminent domain proceedings
pursuant to any law, or by reason of the temporary requisition of the use or
occupancy of all or any part of any Real Property of any person or any part
thereof by any Governmental Authority, civil or military.


 


“CERCLA” shall mean the Comprehensive Environmental
Response, Compensation, and Liability Act of 1980, as amended, 42 U.S.C. § 9601
et seq.


 


A “Change in Control” shall be deemed to have
occurred if:


 


(a)           any
“person” or “group” (as such terms are used in Sections 13(d) and 14(d) of
the Exchange Act), other than one or more Permitted Holders, is or becomes the
beneficial owner (as defined in Rules 13d-3 and 13d-5 under the Exchange
Act, except that for purposes of this clause such person or group shall be
deemed to have “beneficial ownership” of all securities that any such person or
group has the right to acquire, whether such right is exercisable immediately
or only after the passage of time), directly or indirectly, of Voting Stock
representing 50% or more of the voting power of the total outstanding Voting
Stock of Borrower; or


 


(b)           during
any period of two consecutive years, individuals who at the beginning of such
period constituted the Board of Directors of Borrower (together with any new
directors whose election to such Board of Directors or whose nomination for
election was approved by a vote of 66 2/3% of the directors of Borrower then
still in office who were either directors at the beginning of such period or
whose election or nomination for election was previously so


 


5





















 


approved) cease for any reason to constitute at least a majority of the
Board of Directors of Borrower.


 


“Change in Law” shall mean (a) the
adoption of any law, treaty, order, rule or regulation after the Closing
Date, (b) any change in any law, treaty, order, rule or regulation or
in the interpretation or application thereof by any Governmental Authority
after the Closing Date or (c) compliance by any Lender or Issuing Bank (or
for purposes of Section 2.12(b), by any lending office of such
Lender or by such Lender’s or Issuing Bank’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 Closing Date.


 


“Charges” shall have the meaning assigned to
such term in Section 11.13.


 


“Class”, when used in reference to any Loan
or Borrowing, refers to whether such Loan, or the Loans comprising such
Borrowing, are Revolving Loans, Term B Loans or Swingline Loans and, when used
in reference to any Commitment, refers to whether such Commitment is a
Revolving Commitment, Term B Commitment or Swingline Commitment.


 


“Closing Date” shall mean October 3,
2003.


 


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


 


“Collateral” shall mean, collectively, all
of the Security Agreement Collateral and all other property of whatever kind
and nature pledged as collateral under any Security Document.


 


“Collateral Account” shall mean a collateral
account or sub account in the form of a deposit account established and
maintained by the Collateral Agent for the benefit of the Secured Parties, in
accordance with the provisions of Section 9.01.


 


“Collateral Agent” shall have the meaning
assigned to such term in the preamble hereto.


 


“Commercial Letter of Credit” shall mean any
letter of credit or similar instrument issued for the account of Borrower for
the benefit of Borrower or any of its Subsidiaries, for the purpose of providing
the primary payment mechanism in connection with the purchase of materials,
goods or services by Borrower or any of its Subsidiaries in the ordinary course
of their businesses.


 


“Commitment” shall mean, with respect to any
Lender or Original Lender, such Lender’s or Original Lender’s Original Revolving
Commitment, Revolving Commitment, Original Term B Commitment, Term B Commitment
or Swingline Commitment.


 


“Commitment Fee” shall have the meaning
assigned to such term in Section 2.05(a).


 


“Companies” shall mean Borrower and its
Subsidiaries; and “Company” shall
mean any one of them.


 


“Compliance Certificate” shall mean a
certificate of a Financial Officer substantially in the form of Exhibit L.


 


“Confidential Information Memorandum” shall
mean that certain confidential information memorandum prepared in connection
with the syndication of the Commitments and the Loans.


 


6





















 


“Confidential Lender Authorization” shall
mean a Confidential Lender Authorization in the form of Exhibit P.


 


“Consolidated Companies” shall mean Borrower
and its Consolidated Subsidiaries.


 


“Consolidated EBITDA” shall mean, for any
period, Consolidated Net Income for such period, adjusted, in each case only to
the extent (and in the same proportion) deducted in determining such Consolidated
Net Income (and with respect to the portion of Consolidated Net Income
attributable to any Subsidiary of Borrower only if a corresponding amount would
be permitted at the date of determination to be distributed to Borrower by such
Subsidiary without prior approval (that has not been obtained), pursuant to the
terms of its organizational documents and all agreements, instruments,
judgments, decrees, orders, statutes, rules and regulations applicable to
such Subsidiary or its stockholders), by (x) adding thereto (i) the amount
of Consolidated Interest Expense, (ii) provision for taxes based on
income, (iii) amortization expense, (iv) depreciation expense, (v) all
other non cash items (excluding any non cash charge that results in an accrual
or a reserve for cash charges in any future period), (vi) amortization of
intangibles (including, but not limited to, goodwill) and organization costs,
and (vii) any extraordinary expenses or losses (including whether or not
otherwise includable as a separate item in the statement of such Consolidated
Net Income for such period, losses on sales of assets outside the ordinary
course of business), and (y) subtracting (i) the aggregate amount of all
non cash items, determined on a consolidated basis, to the extent such items increased
Consolidated Net Income for such period, (ii) interest income and (iii) any
extraordinary income or gains (including whether or not otherwise includable as
a separate item in the statement of such Consolidated Net Income for such
period, gains on the sales of assets outside the ordinary course of
business.  Consolidated EBITDA shall be
calculated on a Pro Forma Basis to give effect to any Permitted Acquisition and
any Asset Sale (or series of Asset Sales other than related dispositions of
used, worn out, obsolete or surplus property pursuant to Section 6.05(a)(ii))
resulting in aggregate sale proceeds of $15.0 million or more consummated
during the fiscal period of the Borrower ended on the Test Period thereof as if
each such Permitted Acquisition had been effected on the first day of such
period and as if each such Asset Sale had been consummated on the day prior to
the first day of such period; provided, however,
that no effect shall be given to any Permitted Acquisition unless the
Administrative Agent shall have received consolidated statements of income for
such Test Period, all in form reasonably satisfactory to the Administrative
Agent.


 


“Consolidated Indebtedness” shall mean, as
at any date of determination, the aggregate amount of all Indebtedness (but
including in any event the then outstanding principal amount of all Loans, all
Capital Lease Obligations and all LC Exposure) of Borrower and its Consolidated
Subsidiaries on a consolidated basis as determined in accordance with GAAP.


 


“Consolidated Interest Coverage Ratio” shall
mean, for any Test Period, the ratio of (x) Consolidated EBITDA for such Test
Period to (y) Consolidated Interest Expense (excluding any Non-Cash Interest
Expense) less cash interest income for such Test Period.


 


“Consolidated Interest Expense” shall mean,
for any period, the total consolidated interest expense (whether cash or
non-cash) of Borrower and its Consolidated Subsidiaries determined in accordance
with GAAP for the relevant period, including interest expense with respect to
any Funded Debt of Borrower and its Consolidated Subsidiaries and interest
expense for the relevant period that has been capitalized on the balance sheet
of Borrower and its Consolidated Subsidiaries.


 


“Consolidated Net Income” shall mean, for
any period, the consolidated net income of Borrower and its Consolidated
Subsidiaries determined in accordance with GAAP, but excluding in any event (a) after
tax extraordinary gains or extraordinary losses; (b) after tax gains or
losses realized from (i) the acquisition of any securities, or the
extinguishment of any Indebtedness, of Borrower or any of its


 


7





















 


Subsidiaries
or (ii) any sales of assets; (c) net earnings or loss of any other
person (other than a Subsidiary of Borrower) in which Borrower or any Consolidated
Subsidiary has an ownership interest, except (in the case of any such net
earnings) to the extent such net earnings shall have actually been received by Borrower
or such Consolidated Subsidiary (subject to the limitation in clause (d) below)
in the form of cash dividends or distributions; (d) the net income of any
Consolidated Subsidiary to the extent that the declaration or payment of
dividends or similar distributions by such Consolidated Subsidiary of its net
income is not at the time of determination permitted without approval under
applicable law or regulation or under such Consolidated Subsidiary’s
organizational documents or any agreement or instrument applicable to such
Consolidated Subsidiary or its stockholders; (e) gains or losses from the
cumulative effect of any change in accounting principles; (f) earnings
resulting from any reappraisal, revaluation or write up of assets; and (g) the
income (or loss) of any person accrued prior to the date it becomes a
Subsidiary of Borrower or any Consolidated Subsidiary or is merged into or
consolidated with Borrower or any Consolidated Subsidiary or that person’s
assets are acquired by Borrower or such Consolidated Subsidiary.


 


“Consolidated Net Worth” of any Person on
any date means the sum of the capital stock and surplus (including earned
surplus, capital surplus and the balance of the current profit and loss account
not transferred to surplus) accounts of such Person on such date which would appear
on a balance sheet of such Person on such date prepared in accordance with
GAAP.


 


“Consolidated Subsidiary” shall mean, as to
any person, all subsidiaries of such person which are consolidated with such
person for financial reporting purposes in accordance with GAAP.


 


“Contested Collateral Lien Conditions” shall
mean, with respect to any Permitted Lien of the type described in clauses (a), (b) and
(f) of Section 6.02, the following conditions:


 


(a)           the
relevant Company shall cause any proceeding instituted contesting such Lien to
stay the sale or forfeiture of any portion of the Collateral on account of such
Lien;


 


(b)           to
the extent such Lien is in an amount in excess of $1,000,000, the appropriate
Loan Party shall maintain cash reserves or, at the option and upon request of
the Administrative Agent, obtain a bond in an amount sufficient to pay and
discharge such Lien and the Administrative Agent’s reasonable estimate of all
interest and penalties related thereto; and


 


(c)           such
Lien shall in all respects be subject and subordinate in priority to the Lien
and security interest created and evidenced by the Security Documents, except
if and to the extent that the law or regulation creating, permitting or
authorizing such Lien provides that such Lien is or must be superior to the
Lien and security interest created and evidenced by the Security Documents.


 


“Contingent Obligation” shall mean, as to
any person, any obligation, agreement, understanding or arrangement of such
person guaranteeing or intended to guarantee any Indebtedness, leases,
dividends or other obligations (“primary
obligations”) of any other person (the “primary obligor”) in any manner, whether directly or
indirectly, including, without limitation, any obligation of such person,
whether or not contingent, (a) to purchase any such primary obligation or
any property constituting direct or indirect security therefor; (b) to
advance or supply funds (i) for the purchase or payment of any such
primary obligation or (ii) to maintain working capital or equity capital
of the primary obligor or otherwise to maintain the net worth or solvency of
the primary obligor; (c) to purchase property, securities or services
primarily for the purpose of assuring the owner of any such primary obligation
of the ability of the primary obligor to make payment of such primary
obligation; (d) with respect to bankers’ acceptances and letters of
credit, until a reimbursement obligation arises (which obligation shall
constitute Indebtedness); or (e) otherwise to assure or hold harmless the
holder of such primary obligation against loss in respect thereof;


 


8





















 


provided, however,
that the term “Contingent Obligation” shall not include endorsements of
instruments for deposit or collection in the ordinary course of business or any
product warranties for deposit or collection in the ordinary course of
business.  The amount of any Contingent
Obligation shall be deemed to be an amount equal to the stated or determinable
amount of the primary obligation in respect of which such Contingent Obligation
is made (or, if less, the maximum amount of such primary obligation for which
such person may be liable, whether severally or jointly, pursuant to the terms
of the instrument evidencing such Contingent Obligation) or, if not stated or
determinable, the maximum reasonably anticipated liability in respect thereof
(assuming such person is required to perform thereunder) as determined by such
person in good faith.


 


“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 “Controls”
and “Controlled” shall have
meanings correlative thereto.


 


“Control Agreement” shall have the meaning
assigned to such term in the Security Agreement.


 


“Credit Extension” shall mean, as the
context may require, (i) the making of a Loan by a Lender or (ii) the
issuance of any Letter of Credit, or the amendment, extension or renewal of any
existing Letter of Credit, by the Issuing Bank.


 


“Debt Issuance” shall mean the incurrence by
Borrower or any of its Subsidiaries of any Indebtedness after the Closing Date
(other than as permitted by Section 6.01).


 


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


 


“Disqualified Capital Stock” shall mean any
Equity Interest which, by its terms (or by the terms of any security into which
it is convertible or for which it is exchangeable), or upon the happening of
any event, (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, on or prior to 90 days after
the Term B Maturity Date, (b) is convertible into or exchangeable (unless
at the sole option of the issuer thereof) for (i) debt securities or (ii) any
Equity Interests referred to in (a) above, in each case at any time prior
to the 90 days after the Term B Maturity Date, or (c) contains any repurchase
obligation which may come into effect prior to payment in full of all Obligations.


 


“Dividend” with respect to any person shall
mean that such person has declared or paid a dividend or returned any equity
capital to its stockholders or authorized or made any other distribution, payment
or delivery of property (other than common stock of such person) or cash to its
stockholders as such, or redeemed, retired, purchased or otherwise acquired,
directly or indirectly, for a consideration any shares of any class of its
capital stock outstanding (or any options or warrants issued by such person
with respect to its capital stock), or set aside any funds for any of the
foregoing purposes, or shall have permitted any of its subsidiaries to purchase
or otherwise acquire for a consideration any shares of any class of the capital
stock of such person outstanding (or any options or warrants issued by such
person with respect to its capital stock). 
Without limiting the foregoing, “Dividends” with respect to any person
shall not include all payments made or required to be made by such person with
respect to any stock appreciation rights plans, equity incentive or achievement
plans or any similar plans or setting aside of any funds for the foregoing
purposes to the extent such payments do not exceed $5.0 million in the aggregate.


 


“Documentation Agent” shall have the meaning
assigned to such term in the preamble hereto.


 


9





















 


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


 


“Domestic Subsidiary” shall means any Wholly
Owned Subsidiary of Borrower that is not a Foreign Subsidiary.


 


“Earn Out Escrow” shall mean an escrow
account and agreement pursuant to which Borrower escrows some portion of an
Earn Out Obligation with an independent third party escrow agent.


 


“Earn Out Obligation” shall mean those
contingent obligations of Borrower incurred in favor of a seller (or other
third party entitled thereto) under or with respect to any Permitted
Acquisition.


 


“Engagement Letter” shall mean the
confidential Engagement Letter, dated September 16, 2003, between Basic Energy
Services, LP and UBS Securities LLC.


 


“Environment” shall mean ambient air,
surface water and groundwater (including, without limitation, potable water,
navigable water and wetlands), the land surface or subsurface strata, natural resources,
the workplace or as otherwise defined in any Environmental Law.


 


“Environmental Claim” shall mean any claim,
notice, demand, order, action, suit, proceeding or other communication alleging
liability for investigation, remediation, removal, cleanup, response,
corrective action, damages to natural resources, personal injury, property
damage, fines, penalties or other costs resulting from, related to or arising
out of (i) the presence, Release or threatened Release in or into the
Environment of Hazardous Material at any location or (ii) any violation of
Environmental Law, and shall include any claim seeking damages, contribution,
indemnification, cost recovery, compensation or injunctive relief resulting
from, related to or arising out of the presence, Release or threatened Release
of Hazardous Material or alleged injury or threat of injury to health, safety
or the Environment.


 


“Environmental Law” shall mean any and all
applicable present and future treaties, laws, statutes, ordinances,
regulations, rules, decrees, orders, judgments, consent orders, consent decrees
or other binding requirements, and the common law, relating to protection of
public health or the Environment, the Release or threatened Release of
Hazardous Material, natural resources or natural resource damages, or
occupational safety or health.


 


“Environmental Permit” shall mean any
permit, license, approval, consent or other authorization required by or from a
Governmental Authority under Environmental Law.


 


“Equity Interest” shall mean, with respect
to any person, any and all shares, interests, participations or other
equivalents, including membership interests (however designated, whether voting
or non voting), of equity of such person, including, if such person is a
partnership, partnership interests (whether general or limited) and any other
interest or participation that confers on a person the right to receive a share
of the profits and losses of, or distributions of assets of, such partnership
(excluding Earn Out Obligations), whether outstanding on the Closing Date or
issued after the Closing Date, but excluding debt securities convertible or
exchangeable into such equity.


 


“Equity Issuance” shall mean, without
duplication, any issuance in a registered offering or sale pursuant to a
private placement by Borrower after the Closing Date of (a) any Equity
Interests (including any Equity Interests issued upon exercise of any warrant
or option) or any warrants or options to purchase Equity Interests or (b) any
other security or instrument representing an Equity Interest (or the right to obtain
any Equity Interest) in the issuing or selling person.


 


10





















 


“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 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 by regulation); (b) 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), whether or not waived, the failure
to make by its due date a required installment under Section 412(m) of the
Code with respect to any Plan or the failure to make any required contribution
to a Multiemployer Plan; (c) the filing pursuant to Section 412(d) of
the Code or Section 303(d) of ERISA of an application for a waiver of
the minimum funding standard with respect to any Plan; (d) the incurrence
by any Company or any of its ERISA Affiliates of any liability under Title IV
of ERISA with respect to the termination of any Plan; (e) the receipt by
any Company 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, or the occurrence of any
event or condition which could reasonably be expected to constitute grounds
under ERISA for the termination of, or the appointment of a trustee to
administer, any Plan; (f) the incurrence by any Company or any of its
ERISA Affiliates of any liability with respect to the withdrawal from any Plan
or Multiemployer Plan; (g) the receipt by any Company or 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; (h) the
making of any amendment to any Plan which could reasonably be expected to
result in the imposition of a lien or the posting of a bond or other security;
and (i) the occurrence of a nonexempt prohibited transaction (within the
meaning of Section 4975 of the Code or Section 406 of ERISA) which
could result in liability to any Company.


 


“Eurodollar Borrowing” shall mean a
Borrowing comprised of Eurodollar Loans.


 


“Eurodollar Loan” shall mean any Eurodollar
Revolving Loan or Eurodollar Term B Loan.


 


“Eurodollar Revolving Borrowing” shall mean
a Borrowing comprised of Eurodollar Revolving Loans.


 


“Eurodollar Revolving Loan” shall mean any
Revolving Loan bearing interest at a rate determined by reference to the Adjusted
LIBOR Rate in accordance with the provisions of Article II.


 


“Eurodollar Term B Borrowing” shall mean a
Borrowing comprised of Eurodollar Term B Loans.


 


“Eurodollar Term B Loan” shall mean any Term
B Loan bearing interest at a rate determined by reference to the Adjusted LIBOR
Rate in accordance with the provisions of Article II.


 


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


 


“Exchange Act” shall mean the Securities
Exchange Act of 1934, as amended.


 


11





















 


“Existing Lien” shall have the meaning
assigned to such term in the applicable Security Document.


 


“Excluded Taxes” shall mean, with respect to
the Administrative Agent, any Lender, the Issuing Bank or any other recipient
of any payment to be made by or on account of any obligation of Borrower
hereunder, (a) income or franchise taxes imposed on (or measured by) its
net income by the United States, or by 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, and (b) in
the case of a Foreign Lender (other than an assignee pursuant to a request by Borrower
under Section 2.16), 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 2.15(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 Borrower with respect to such withholding
tax pursuant to Section 2.15(a) (it being understood and
agreed, for the avoidance of doubt, that any withholding tax imposed on a
Foreign Lender as a result of a Change in Law or regulation or interpretation
thereof occurring after the time such Foreign Lender became a party to this
Agreement shall not be an Excluded Tax).


 


“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 confidential Fee
Letter, dated November 14,
2005, among Borrower, UBS AG, Cayman Islands Branch, and UBS Securities LLC.


 


“Fees” shall mean the Commitment Fees, the
Administrative Agent Fees, the LC Participation Fees and the Fronting Fees.


 


“Fesco” shall mean First Energy Services
Company, a Delaware corporation.


 


“Fesco AK” shall mean Fesco Alaska, Inc.,
an Alaska corporation.


 


“Financial Officer” of any person shall mean
the Chief Financial Officer, principal accounting officer, Treasurer or
Controller of such person.


 


“FIRREA” shall mean the Federal Institutions
Reform, Recovery and Enforcement Act of 1989.


 


“Foreign Lender” shall mean any Lender that
is not, for United States federal income tax purposes, (i) a citizen or
resident of the United States, (ii) a corporation or entity treated as a
corporation created or organized in or under the laws of the United States, or
any political subdivision thereof, (iii) an estate the income of which is
subject to U.S. federal income taxation regardless of its source or (iv) a
trust if a court within the United States is able to exercise primary
supervision over the administration of such trust and one or more United States
persons have the authority to control all substantial decisions of such trust.


 


“Foreign Subsidiary” shall mean a Subsidiary
that is organized under the laws of a jurisdiction other than the United States
or any state thereof or the District of Columbia.


 


12





















 


“Fronting Fees” shall have the meaning
assigned to such term in Section 2.05(c).


 


“Funded Debt” shall mean, with respect to
any person, without duplication, all Indebtedness for borrowed money evidenced
by notes, bonds, debentures, or similar evidences of Indebtedness that by its
terms matures more than one year from, or is directly or indirectly renewable
or extendible at such person’s option under a revolving credit or similar
agreement obligating the lender or lenders thereunder to extend credit or incur
letter of credit obligations over a period of more than one year from the date
of creation thereof, and specifically including Capital Lease Obligations,
current maturities of long-term debt, revolving credit and short-term debt
extendible beyond one year at the option of the debtor, and also including, in
the case of Borrower, the Obligations and, without duplication, Contingent
Obligations in respect of Funded Debt of other persons.


 


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


 


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


 


“Governmental Real Property Disclosure Requirements”
shall mean any Requirement of Law of any Governmental Authority requiring
notification of the buyer, lessee, mortgagee, assignee or other transferee of
any Real Property, facility, establishment or business, or notification,
registration or filing to or with any Governmental Authority, in connection
with the sale, lease, mortgage, assignment or other transfer (including,
without limitation, any transfer of control) of any Real Property, facility,
establishment or business, of the actual or threatened presence or Release in
or into the Environment, or the use, disposal or handling of Hazardous Material
on, at, under or near the Real Property, facility, establishment or business to
be sold, leased, mortgaged, assigned or transferred.


 


“Guaranteed Obligations” shall have the
meaning assigned to such term in Section 7.01.


 


“Guarantees” shall mean the guarantees
issued pursuant to Article VII by Borrower and the Subsidiary
Guarantors.


 


“Hazardous Materials” shall mean the
following:  hazardous substances;
hazardous wastes; polychlorinated biphenyls (“PCBs”)
or any substance or compound containing PCBs; asbestos or any asbestos containing
materials in any form or condition; radon or any other radioactive materials
including any source, special nuclear or by product material; petroleum, crude
oil or any fraction thereof; and any other pollutant or contaminant chemicals,
wastes, materials, compounds, constituents or substances, subject to regulation
or which can give rise to liability under any Environmental Laws.


 


“HBR” shall mean H.B.&R., Inc., a
Montana corporation.


 


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


 


“Increased Amount Date” shall have the
meaning assigned to such term in Section 2.22(a).


 


“Indebtedness” of any person shall mean,
without duplication, (a) all obligations of such person for borrowed money
or advances; (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 or accrued; (d) all
obligations of such person under conditional sale or other title retention


 


13





















 


agreements
relating to property 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 on normal trade terms and not overdue by more than
90 days); (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 to the extent of the fair
market value of such property; (g) all Capital Lease Obligations, Purchase
Money Obligations and synthetic lease obligations of such person; (h) all
obligations of such person in respect of Hedging Agreements to the extent
required to be reflected on a balance sheet of such person; (i) all Attributable
Indebtedness of such person; (j) all obligations for the reimbursement of any
obligor in respect of letters of credit, letters of guaranty, bankers’
acceptances and similar credit transactions; and (k) all Contingent Obligations
(other than contingent Earn Out Obligations) of such person in respect of
Indebtedness or obligations of others of the kinds referred to in clauses (a) through
(j) above.  The Indebtedness of any
person shall include the Indebtedness of any other entity (including any
partnership in which such person is a general partner) to the extent such
person is liable therefor as a result of such person’s ownership interest in or
other relationship with such entity, except to the extent that terms of such
Indebtedness provide that such person is not liable therefor.  The Indebtedness of any person shall not
include ordinary course financings of insurance premiums consistent with the
past practices of such person.


 


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


 


“Indemnitee” shall have the meaning assigned
to such term in Section 11.03(b).


 


“Information” shall have the meaning
assigned to such term in Section 11.12.


 


“Intellectual Property” shall have the
meaning assigned to such term in Section 3.07(a).


 


“Interest Election Request” shall mean a
request by Borrower to convert or continue a Revolving Borrowing or Term B
Borrowing in accordance with Section 2.08(b), substantially in the
form of Exhibit D.


 


“Interest Payment Date” shall mean (a) with
respect to any ABR Loan (other than a Swingline Loan), the last day of each
March, June, September and December to occur during the period that
such Loan is outstanding and the final maturity date of such Loan, (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
Loan with an Interest Period of more than three months’ duration, the last day
of such Interest Period that occurs at intervals of three months’ duration
after the first day of such Interest Period, and (c) with respect to any
Swingline Loan, the day that such Loan is required to be repaid.


 


“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 in the calendar month
that is one, two, three or six months thereafter, as Borrower may elect; provided that (a) 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 and (b) any Interest Period
that commences on the last Business Day of a calendar month (or on a day for
which there is no numerically corresponding day in the last calendar month of
such Interest Period) shall end on the last Business Day of the last calendar
month 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; provided, however, that an Interest Period
shall be limited to seven days to the extent required under Section 2.03(e).


 


14





















 


“Interest Rate Agreement” shall mean any
interest rate swap agreement, interest rate cap agreement, interest rate collar
agreement or similar agreement or arrangement.


 


“Investments” shall have the meaning
assigned to such term in Section 6.04.


 


“IPO” shall mean the first underwritten
public offering by Borrower of its Equity Interests after the Closing Date
pursuant to a registration statement filed with the Securities and Exchange
Commission in accordance with the Securities Act.


 


“Issuing Bank” shall mean, as the context
may require, (a) UBS AG, Stamford Branch, with respect to Letters of
Credit issued by it; (b) any other Lender that may become an Issuing Bank
pursuant to Section 2.18(j), with respect to Letters of Credit
issued by such Lender; or (c) collectively, all of the foregoing.


 


“Joinder Agreement” shall mean that certain
joinder agreement substantially in the form of Exhibit E.


 


“Landlord Lien Waiver and Access Agreement”
shall mean the Landlord Lien Waiver and Access Agreement, substantially in the
form of Exhibit F.


 


“LC Commitment” shall mean the commitment of
the Issuing Bank to issue Letters of Credit pursuant to Section 2.18.  The amount of the LC Commitment shall be
$20.0 million, but in no event exceed the Revolving Commitment.


 


“LC Disbursement” shall mean a payment or
disbursement made by the Issuing Bank pursuant to a Letter of Credit.


 


“LC Exposure” shall mean at any time the sum
of (a) the aggregate undrawn amount of all outstanding Letters of Credit
at such time plus (b) the
aggregate principal amount of all Reimbursement Obligations outstanding at such
time.  The LC Exposure of any Revolving
Lender at any time shall mean its Pro Rata Percentage of the aggregate LC
Exposure at such time.


 


“LC Participation Fee” shall have the
meaning assigned to such term in Section 2.05(c).


 


“LC Request” shall mean a request by
Borrower in accordance with the terms of Section 2.18(b) and
substantially in the form of Exhibit C-2, or such other form as
shall be approved by the Administrative Agent.


 


“LC Sub Account” shall have the meaning
assigned to such term in Section 9.01(d).


 


“Leases” shall mean any and all leases,
subleases, tenancies, options, concession agreements, rental agreements,
occupancy agreements, franchise agreements, access agreements and any other
agreements (including all amendments, extensions, replacements, renewals,
modifications and/or guarantees thereof), whether or not of record and whether
now in existence or hereafter entered into, affecting the use or occupancy of
all or any portion of any Real Property.


 


“Lender Addendum” shall mean with respect to
any Original Lender on the Closing Date, a lender addendum in the form of Exhibit N,
executed and delivered by such Original Lender on the Closing Date as provided
in Section 11.14.


 


15





















 


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


 


“Lenders” shall mean (a) the financial
institutions that are signatory hereto (pursuant to the provisions of Section 11.06)
and (b) any financial institution that has become a party hereto pursuant
to an Assignment and Acceptance, in each case, other than any such financial
institution that has ceased to be a party hereto pursuant to another Assignment
and Acceptance.  Unless the context
clearly indicates otherwise, the term “Lenders” shall include the Swingline
Lender.


 


“Letter of Credit” shall mean any (i) Standby
Letter of Credit and (ii) Commercial Letter of Credit, in each case,
issued or to be issued by an Issuing Bank for the account of Borrower or a
Subsidiary pursuant to Section 2.18.


 


“Letter of Credit Expiration Date” shall
mean the date which is fifteen Business Days prior to the Revolving Maturity Date.


 


“Leverage Ratio” shall mean, at any date of
determination, the ratio of Consolidated Indebtedness less unrestricted cash as
reflected on the most recent balance sheet of the Consolidated Companies to
Consolidated EBITDA for the Test Period then most recently ended.


 


“LIBOR Rate” shall mean, with respect to any
Eurodollar Borrowing for any Interest Period therefor, the rate per annum
determined by the Administrative Agent to be the arithmetic mean (rounded to
the nearest 1/100th of 1%) of the offered rates for deposits in dollars with a
term comparable to such Interest Period that appears on the Telerate British
Bankers Assoc. Interest Settlement Rates Page (as defined below) at
approximately 11:00 a.m., London, England time, on the second full
Business Day preceding the first day of such Interest Period; provided, however, that (i) if
no comparable term for an Interest Period is available, the LIBOR Rate shall be
determined using the weighted average of the offered rates for the two terms
most nearly corresponding to such Interest Period and (ii) if there shall
at any time no longer exist a Telerate British Bankers Assoc. Interest
Settlement Rates Page, “LIBOR Rate” shall mean, with respect to each day during
each Interest Period pertaining to Eurodollar Borrowings comprising part of the
same Borrowing, the rate per annum equal to the rate at which the
Administrative Agent is offered deposits in dollars at approximately 11:00 a.m.,
London, England time, two Business Days prior to the first day of such Interest
Period in the London interbank market for delivery on the first day of such
Interest Period for the number of days comprised therein and in an amount
comparable to its portion of the amount of such Eurodollar Borrowing to be
outstanding during such Interest Period. 
“Telerate British Bankers Assoc.
Interest Settlement Rates Page” shall mean the display designated as
Page 3750 on the Telerate System Incorporated Service (or such other page as
may replace such page on such service for the purpose of displaying the
rates at which dollar deposits are offered by leading banks in the London
interbank deposit market).


 


“Lien” shall mean, with respect to any
property, (a) any mortgage, deed of trust, lien, pledge, encumbrance,
claim, charge, assignment, hypothecation, security interest or encumbrance of
any kind, any other type of preferential arrangement in respect of such
property or any filing of any financing statement under the UCC or any other
similar notice of Lien under any similar notice or recording statute of any
Governmental Authority, including any easement, right of way or other
encumbrance on title to Real Property, in each of the foregoing cases whether
voluntary or imposed by law, and any agreement to give any of the foregoing; (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 property;
and (c) in the case of securities, any purchase option, call or similar
right of a third party with respect to such securities.


 


16





















 


“Liquidity” 
means, as of any date of determination, the sum of (i) all
unrestricted cash balances of Borrower and its consolidated Subsidiaries as of
such date and (ii) the amount by which the aggregate amount of the
Revolving Commitments available to be borrowed without resulting in a Default then
exceeds the aggregate principal amount of the total Revolving Exposure of all
Lenders as of such date.


 


“Loan Documents” shall mean this Agreement,
the Letters of Credit, the Notes (if any), the Security Documents and each
Hedging Agreement entered into with any counterparty that was a Lender or an
Affiliate of a Lender at the time such Hedging Agreement was entered into, and
solely for the purposes of Section 8(e) hereof, the Fee
Letter.


 


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


 


“Loans” shall mean, as the context may
require, an Original Revolving Loan, a Revolving Loan, an Original Term B Loan,
a Term B Loan or a Swingline Loan (and shall include any Loans under the New
Revolving Commitments).


 


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


 


“Material Adverse Effect” shall mean (a) a
material adverse effect on the business, property, results of operations,
prospects or condition, financial or otherwise, of Borrower and its
Subsidiaries, taken as a whole; (b) material impairment of the ability of
the Loan Parties to fully and timely perform their material obligations under
any Loan Document; (c) material impairment of the rights of or benefits or
remedies available to the Lenders or the Collateral Agent under any Loan
Document; or (d) a material adverse effect on the Collateral or the Liens
in favor of the Collateral Agent (for its benefit and for the benefit of the
other Secured Parties) on the Collateral or the priority of such Liens.


 


“Maximum Rate” shall have the meaning
assigned to such term in Section 11.13.


 


“Moody’s” shall have the meaning assigned to
such term in the definition of “Cash Equivalents” in Section 1.01.


 


“Mortgage” shall mean an agreement,
including, but not limited to, a mortgage, deed of trust or any other document,
creating and evidencing a Lien on a Mortgaged Property, which shall be in form
and substance acceptable to the Collateral Agent, with such schedules and
including such provisions as shall be necessary to conform such document to
applicable local or foreign law or as shall be customary under applicable local
or foreign law.


 


“Mortgaged Property” shall have the meaning
assigned to such term in the Original Credit Agreement.


 


“Multiemployer Plan” shall mean a
multiemployer plan within the meaning of Section 4001(a)(3) or Section 3(37)
of ERISA (a) to which any Company or any ERISA Affiliate is then making or
accruing an obligation to make contributions; (b) to which any Company or
any ERISA Affiliate has within the preceding five plan years made
contributions; or (c) with respect to which any Company could incur
liability.


 


“Net Cash Proceeds” shall mean:


 


(a)           with
respect to any Asset Sale, the cash proceeds received by any Loan Party
(including cash proceeds subsequently received (as and when received by any
Loan Party) in respect of noncash consideration initially received) net of (i) selling
expenses (including reasonable


 


17





















 


brokers’ fees or commissions, legal, accounting and other professional
and transactional fees, transfer and similar taxes and Borrower’s good faith
estimate of income taxes paid or payable in connection with such sale); (ii) amounts
provided as a reserve, in accordance with GAAP, against any liabilities under
any indemnification obligations 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); (iii) Borrower’s good faith estimate of
payments required to be made with respect to unassumed liabilities relating to
the assets sold within 90 days of such Asset Sale (provided that, to the extent such cash proceeds are not used
to make payments in respect of such unassumed liabilities within 90 days of
such Asset Sale, such cash proceeds shall constitute Net Cash Proceeds); and (iv) the
principal amount, premium or penalty, if any, interest and other amounts on any
Indebtedness for borrowed money which is secured by a senior Lien on the asset
sold in such Asset Sale and which is repaid with such proceeds (other than any
such Indebtedness assumed by the purchaser of such asset);


 


(b)           with
respect to any Debt Issuance or Equity Issuance, the cash proceeds thereof, net
of customary fees, commissions, costs and other expenses incurred in connection
therewith; and


 


(c)           with
respect to any Casualty Event, the cash insurance proceeds, condemnation awards
and other compensation received in respect thereof, net of all reasonable costs
and expenses incurred in connection with the collection of such proceeds,
awards or other compensation in respect of such Casualty Event.


 


“New Commitments” means New Revolving
Commitments and New Term B Commitments.


 


“New Lender” means a New Revolving Lender
and/or a New Term B Lender.


 


“New Revolving Commitments” shall have the
meaning assigned to such term in Section 2.22(a).


 


“New Revolving Lenders” shall have the
meaning assigned to such term in Section 2.22(a).


 


“New Term B Commitment” has the meaning set
forth in Section 2.22.


 


“New Term B Lender” means any Person having
a New Term B Commitment.


 


“Non-Cash Interest Expense” shall mean, for
any Test Period, all amounts included in Consolidated Interest Expense which
will require no cash payment at any time prior to the Revolving Maturity Date.


 


“Non Guarantor Subsidiary” shall mean each
Subsidiary that is not a Subsidiary Guarantor.


 


“Notes” shall mean any notes evidencing the
Original Term B Loans, Term B Loans, Original Revolving Loans, Revolving Loans
or Swingline Loans issued pursuant to this Agreement, if any, substantially in
the form of Exhibit G-1, G-2, G-3,  G-4 or G-5.


 


“Obligations” shall mean (a) obligations
of Borrower and any and all of the other Loan Parties from time to time arising
under or in respect of the due and punctual payment of (i) the principal
of and premium, if any, and interest (including interest accruing during the
pendency of any bankruptcy, insolvency, receivership or other similar
proceeding, regardless of whether allowed or allowable in such proceeding) on
the Loans, when and as due, whether at maturity, by acceleration, upon one or
more dates set


 


18





















 


for prepayment
or otherwise, (ii) each payment required to be made by Borrower and any
and all of the other Loan Parties under this Agreement in respect of any Letter
of Credit, when and as due, including payments in respect of Reimbursement
Obligations, interest thereon and obligations to provide cash collateral and (iii) all
other monetary obligations, including fees, costs, expenses and indemnities,
whether primary, secondary, direct, contingent, fixed or otherwise (including
monetary obligations incurred during the pendency of any bankruptcy,
insolvency, receivership or other similar proceeding, regardless of whether
allowed or allowable in such proceeding), of Borrower and any and all of the
other Loan Parties under this Agreement and the other Loan Documents, (b) the
due and punctual performance of all covenants, agreements, obligations and
liabilities of Borrower and each Loan Party under or pursuant to this Agreement
and the other Loan Documents, (c) the due and punctual payment and
performance of all obligations of Borrower and any and all of the other Loan
Parties under each Hedging Agreement relating to Loans entered into with any
counterparty that was a Lender, an Original Lender or an Affiliate of a Lender
or Original Lender at the time such Hedging Agreement was entered into and (d) the
due and punctual payment and performance of all obligations in respect of
overdrafts and related liabilities owed to any Lender, Original Lender or any
Affiliate of a Lender or Original Lender, the Administrative Agent or the
Collateral Agent arising from treasury, depositary and cash management services
or in connection with any automated clearinghouse transfer of funds.


 


“Officers’ Certificate” shall mean a
certificate executed by the Chairman of the Board (if an officer), the Chief
Executive Officer or the President and one of the Financial Officers, each in
his or her official (and not individual) capacity.


 


“Original Lenders” shall mean the financial
institutions that were parties to the Original Credit Agreement as “Lenders”
thereunder.  Any reference in Section 4.01
to “Original Lender” shall mean Original Lenders who were party to the Original
Credit Agreement on the Closing Date.


 


“Original Credit Agreement” shall have the
meaning set forth in the recitals hereto.


 


“Original Revolving Borrowing” shall mean a
Borrowing comprised of Original Revolving Loans.


 


“Original Revolving Commitment” shall mean
with respect to each Original Lender, the commitment, if any, of such Original
Lender to make a Revolving Loan hereunder after the Closing Date in the amount
set forth on Schedule I to the Lender Addendum executed and delivered by
such Original Lender, in the Assignment and Acceptance pursuant to which such
Original Lender shall have assumed its Revolving Commitment or in Schedule 1
to the Confidential Lender Authorization executed and delivered by such
Original Lender, as applicable, as such commitment may be (a) terminated
or reduced from time to time pursuant to Section 2.07 and (b) reduced
or increased from time to time pursuant to assignments by or to such Original
Lender pursuant to Section 11.04. 
The initial aggregate amount of the Original Lenders’ Original Revolving
Commitments was $50.0 million.


 


“Original Revolving Loans” shall mean the
revolving loans made by the Original Lenders to operating subsidiaries of
Borrower pursuant to Section 2.01(b) of the Original Credit
Agreement.  Each Original Revolving Loan was
either an ABR Revolving Loan or a Eurodollar Revolving Loan.


 


“Original Term B Borrowing” shall mean a
Borrowing comprised of Original Term B Loans.


 


“Original Term B Commitment” shall mean with
respect to each Original Lender, the commitment, if any, of such Original
Lender to make a Term B Loan hereunder on the Closing Date in the amount set
forth on Schedule I to the Lender Addendum executed and delivered by such
Original Lender, in the Assignment and Acceptance pursuant to which such
Original Lender shall have assumed its Term B


 


19





















 


Commitment or
in Schedule 1 to the Confidential Lender Authorization executed and
delivered by such Original Lender, as applicable, as such commitment may be (a) terminated
or reduced from time to time pursuant to Section 2.07 and (b) reduced
or increased from time to time pursuant to assignments by or to such Original
Lender pursuant to Section 11.04. 
The initial aggregate amount of the Original Lenders’ Original Term B Commitments
was $170.0 million.


 


“Original Term B Loans” shall mean the term
loans made by the Original Lenders to operating subsidiaries of Borrower
pursuant to Section 2.01(a) of the Original Credit Agreement.  Each Original Term B Loan was either an ABR Term
B Loan or a Eurodollar Term B Loan.


 


“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 (including interest, fines, penalties and additions
to tax) arising from any payment made or required to be made under any Loan
Document or from the execution, delivery or enforcement of, or otherwise with
respect to, any Loan Document.


 


“Participant” shall have the meaning
assigned to such term in Section 11.04(e).


 


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


 


“PCBs” shall have the meaning assigned to
such term in the definition of “Hazardous Materials” in Section 1.01.


 


“Perfection Certificate” shall mean a
certificate in the form of Exhibit H-1 or any other form approved
by the Collateral Agent, as the same shall be supplemented from time to time by
a Perfection Certificate Supplement or otherwise.


 


“Perfection Certificate Supplement” shall
mean a certificate supplement in the form of Exhibit H-2 or any
other form approved by the Collateral Agent.


 


“Permitted Acquisition” shall mean, with
respect to Borrower or any Subsidiary Guarantor, any transaction or series of
related transactions for the direct or indirect (a) acquisition of all or
substantially all of the property of any other person, or of any business or
division of any other person; (b) acquisition of in excess of 50% of the
Equity Interests of any other person, or otherwise causing any other person to
become a subsidiary of such person; or (c) merger or consolidation or any
other combination with any other person, if, at the time of, and after giving
effect on a Pro Forma basis to, such transaction or series of transactions, no
Default then exists or would result therefrom, and


 


(i) the Leverage Ratio as
of the end of the most recent fiscal quarter for which financial statements are
available was less than 2.75 to 1.0 and Liquidity is greater than $10,000,000;
or


 


(ii) the Leverage Ratio as
of the end of the most recent fiscal quarter for which financial statements are
available and as of the preceding fiscal quarter was in each case less than
2.75 to 1.0; or


 


(iii) the following conditions
are met:


 


(A)          after
giving effect to such acquisition on a Pro Forma Basis, (1) the Borrower
shall be in compliance with all covenants set forth in Section 6.08
as of the most recent Test Period (assuming, for purposes of Section 6.08,
that such acquisition, and all other Permitted Acquisitions consummated since
the first day of the relevant Test Period for each of the financial covenants
set forth in Section 6.08 ending on or prior to the date of such
acquisition, had occurred on the first day of such relevant Test Period), (2) unless
expressly approved by the Administrative


 


20





















 


Agent, the Borrower shall have generated positive Consolidated EBITDA
for the Test Period most recently ended prior to the date of consummation of
such acquisition and (3) the relevant Borrower shall have cash on
hand/working capital availability equal to or greater than $10.0 million;


 


(B)           no
Company shall, in connection with any such acquisition, assume or remain liable
with respect to any Indebtedness or other liability (including any material tax
or ERISA liability) of the related seller or the business, person or assets
acquired, except to the extent permitted under Section 6.01 and any
other such liabilities or obligations not permitted to be assumed or otherwise
supported by any Company hereunder shall be paid in full or released as to the
business, persons or assets being so acquired on or before the consummation of
such acquisition;


 


(C)           the
acquired person shall be engaged in a business of the same or similar type
conducted by Borrower and the Subsidiaries on the Closing Date and the property
acquired in connection with any such acquisition shall be made subject to the
Lien of the Security Documents and shall be free and clear of any Liens, other
than Permitted Liens;


 


(D)          the
board of directors or other similar governing body of the acquired person shall
not have indicated publicly its opposition to the consummation of such
acquisition;


 


(E)           all
transactions in connection therewith shall be consummated in accordance with
all applicable laws of all applicable Governmental Authorities;


 


(F)           at
least 10 Business Days prior to the proposed date of consummation of the
acquisition, Borrower shall have delivered to the Agents and the Lenders an
Officers’ Certificate certifying that (1) such acquisition complies with
this definition (which shall have attached thereto reasonably detailed backup
data and calculations showing such compliance), and (2) such acquisition
could not reasonably be expected to result in a Material Adverse Effect;


 


(G)           after
giving effect to such transaction or series of transactions, Liquidity shall be
at least $10,000,000; and


 


(H)          the
Acquisition Consideration for such acquisition shall not exceed 20% of
Consolidated Net Worth as of the end of the most recent fiscal quarter for
which financial statements have been delivered, plus the Available Acquisition
Cash (defined below) at the time of such acquisition; provided that any Equity Interests
constituting all or a portion of such Acquisition Consideration shall be
Qualified Capital Stock; for the purposes of this clause (iii)(H), “Available Acquisition Cash” shall mean a
dollar amount equal to the amount by which Borrower’s unrestricted cash as
reflected on its most recent balance sheet exceeds $5.0 million.


 


“Permitted Holders” shall mean Credit Suisse
First Boston, First Reserve Corporation and their respective Affiliates.


 


“Permitted Liens” shall have the meaning
assigned to such term in Section 6.02.


 


“Permitted Subordinated Indebtedness” shall
mean unsecured subordinated debt of Borrower that is expressly subordinated to
the Obligations under this Agreement; provided
that (i) the terms of such debt (x) do not provide for any scheduled repayment,
mandatory redemption or sinking fund obligation prior to 90 days after the Term
B Loan Maturity Date and (y) do not materially restrict, limit or adversely
affect the ability of Borrower or any of its subsidiaries to perform their
obligations under any of the Loan Documents and (ii) the covenants, events
of default, subsidiary guarantees, credit support and


 


21





















 


subordination
terms are customary for similar offerings by issuers with credit ratings
comparable to that of the issuer of such debt and the subordination terms are
otherwise satisfactory to the Administrative Agent.


 


“person” shall mean any natural person,
corporation, business, trust, joint venture, association, company, limited
liability company, partnership or government, or any agency or political
subdivision thereof, in any case, whether acting in a personal, fiduciary or
other capacity.


 


“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
which is maintained or contributed to by any Company or its ERISA Affiliate or
with respect to which any Company could incur liability (including, without
limitation, under Section 4069 of ERISA).


 


“Pro Forma Basis” shall mean on a basis in
accordance with GAAP and Regulation S-X and otherwise reasonably satisfactory
to the Administrative Agent.


 


“Pro Rata Percentage” of any Revolving
Lender at any time shall mean the percentage of the total Revolving Commitment
represented by such Lender’s Revolving Commitment.


 


“property” shall mean any right, title or
interest in or to property or assets of any kind whatsoever, whether real,
personal or mixed and whether tangible or intangible and including Equity
Interests or other ownership interests of any person and whether now in
existence or owned or hereafter entered into or acquired, including, without
limitation, all Real Property.


 


“Purchase Money Obligation” shall mean, for
any person, the obligations of such person in respect of Indebtedness incurred
for the purpose of financing all or any part of the purchase price of any
property (including Equity Interests of any person) or the cost of
installation, construction or improvement of any property or assets and any
refinancing thereof; provided, however,
that such Indebtedness is incurred within 90 days after such acquisition of
such property by such person.


 


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


 


“Real Property” shall mean, collectively,
all right, title and interest (including any leasehold estate) in and to any
and all parcels of or interests in real property owned, leased or operated by
any person, whether by lease, license or other means, together with, in each
case, all easements, hereditaments and appurtenances relating thereto, all
improvements and appurtenant fixtures and equipment, all general intangibles
and contract rights and other property and rights incidental to the ownership,
lease or operation thereof.


 


“Reduced Lender” shall have the meaning
assigned to such term in the recitals hereto.


 


“Register” shall have the meaning assigned
to such term in Section 11.04(c).


 


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


 


“Regulation S-X” shall mean Regulation S-X
promulgated under the Securities Act as from time to time in effect and all
official rulings and interpretations thereunder or thereof.


 


“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.


 


22





















 


“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.


 


“Release” shall mean any spilling, leaking,
seepage, pumping, pouring, emitting, emptying, discharging, injecting,
escaping, leaching, dumping, disposing, depositing, dispersing, emanating or
migrating of any Hazardous Material in, into, onto or through the Environment.


 


“Reimbursement Obligations” shall mean Borrower’s
obligations under Section 2.18(e) to reimburse LC
Disbursements.


 


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


 


“Requirements of Law” shall mean,
collectively, any and all requirements of any Governmental Authority including
any and all laws, ordinances, rules, regulations or similar statutes or case
law.


 


“Response” shall mean (a) “response” as
such term is defined in CERCLA, 42 U.S.C. § 9601(24), and (b) all
other actions required by any Governmental Authority or voluntarily undertaken
to:  (i) clean up, remove, treat,
abate or in any other way address any Hazardous Material in the Environment; (ii) prevent
the Release or threat of Release, or minimize the further Release, of any
Hazardous Material; or (iii) perform studies and investigations in
connection with, or as a precondition to, clause (i) or (ii) above.


 


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


 


“Revolving Availability Period” shall mean
the period from and including the Closing Date to but excluding the earlier of
the Business Day proceeding the Revolving Maturity Date and the date of
termination of the Revolving Commitments.


 


“Revolving Borrowing” shall mean a Borrowing
comprised of Revolving Loans.


 


“Revolving Commitment” shall mean, with
respect to each Lender, the commitment, if any, of such Lender to make
Revolving Loans hereunder up to the amount set forth on Schedule I
to the Lender Addendum executed and delivered by such Lender, in the Assignment
and Acceptance pursuant to which such Lender assumed its Revolving Commitment
or in a joinder agreement pursuant to Section 2.22, as applicable,
as the same may be (a) reduced from time to time pursuant to Section 2.07
and (b) reduced or increased from time to time pursuant to assignments by
or to such Lender pursuant to Section 11.04 or in a joinder
agreement pursuant to Section 2.22. 
The aggregate amount of the Lenders’ Revolving Commitments immediately
prior to the Third Amendment and Restatement Effective Date is $50.0 million
and the aggregate amount of the Lenders’ Revolving Commitments on the Third
Amendment and Restatement Effective Date is $150.0 million.


 


“Revolving Exposure” shall mean, with
respect to any Lender at any time, the aggregate principal amount at such time
of all outstanding Revolving Loans of such Lender, plus the aggregate amount at


 


23





















 


such time of
such Lender’s LC Exposure, plus
the aggregate amount at such time of such Lender’s Swingline Exposure.


 


“Revolving Lender” shall mean a Lender with
a Revolving Commitment (including any New Revolving Lender).


 


“Revolving Loan” shall mean a loan made by a
Lender to Borrower pursuant to Section 2.01(a).


 


“Revolving Maturity Date” shall mean the
fifth anniversary of the Third Amendment and Restatement Effective Date.


 


“S&P” shall have the meaning assigned to
such term in the definition of “Cash Equivalents” in Section 1.01.


 


“Sarbanes Oxley Act” shall mean the United
States Sarbanes Oxley Act of 2002, as from time to time in effect and all rules and
regulations promulgated thereunder.


 


“Secured Parties” shall mean, collectively,
the Administrative Agent, the Collateral Agent, each other Agent, the Lenders
and each party to a Hedging Agreement relating to the Loans if at the date of
entering into such Hedging Agreement such person was a Lender or an Affiliate
of a Lender and such person executes and delivers to the Administrative Agent a
letter agreement in form and substance acceptable to the Administrative Agent
pursuant to which such person (i) appoints the Collateral Agent as its
agent under the applicable Loan Documents and (ii) agrees to be bound by
the provisions of Section 9.03.


 


“Securities Act” shall mean the Securities
Act of 1933, as amended.


 


“Securities Collateral” shall have the
meaning assigned to such term in the Security Agreement.


 


“Security Agreement” shall mean a Security
Agreement substantially in the form of Exhibit I among the Loan
Parties and Collateral Agent for the benefit of the Secured Parties.


 


“Security Agreement Collateral” shall mean
all property pledged or granted as collateral pursuant to the Security Agreement
delivered on the Closing Date or thereafter pursuant to Section 5.11.


 


“Security Documents” shall mean the Security
Agreement, the Mortgages, if any, the Perfection Certificate and each other
security document or pledge agreement delivered in accordance with applicable
local or foreign law to grant a valid, perfected security interest in any
property, and all UCC or other financing statements or instruments of
perfection required by this Agreement, any security agreement or any Mortgage
to be filed with respect to the security interests in property and fixtures
created pursuant to the Security Agreement or any Mortgage and any other
document or instrument utilized to pledge as collateral for the Obligations any
property of whatever kind or nature.


 


“Standby Letter of Credit”  shall mean any standby letter of credit or
similar instrument issued for the purpose of supporting (a) workers’
compensation liabilities of Borrower or any of its Subsidiaries, (b) the
obligations of third party insurers of Borrower or any of its Subsidiaries
arising by virtue of the laws of any jurisdiction requiring third party
insurers to obtain such letters of credit, or (c) performance, payment,
deposit or surety obligations of Borrower or any of its Subsidiaries if
required by law or governmental rule or regulation or in accordance with
custom and practice in the industry.


 


24





















 


“Statutory Reserves” shall mean, for any
Interest Period for any Eurodollar Borrowing, the average maximum rate at which
reserves (including any marginal, supplemental or emergency reserves) are
required to be maintained during such Interest Period under Regulation D by
member banks of the United States Federal Reserve System in New York City with
deposits exceeding one billion dollars against “Eurodollar liabilities” (as
such term is used in Regulation D). 
Eurodollar Borrowings shall be deemed to constitute Eurodollar
liabilities and to be subject to such reserve requirements without benefit of
or credit for proration, exceptions or offsets which may be available from time
to time to any Lender under Regulation D.


 


“subsidiary” shall mean, with respect to any
person (the “parent”) at any date,
(i) any person the accounts of which would be consolidated with those of
the parent in the parent’s consolidated financial statements if such financial
statements were prepared in accordance with GAAP as of such date, (ii) any
other corporation, limited liability company, association or other business
entity of which securities or other ownership interests representing more than
50% of the voting power of all Equity Interests entitled (without regard to the
occurrence of any contingency) to vote in the election of the board of
directors thereof are, as of such date, owned, controlled or held by the parent
and/or one or more subsidiaries of the parent, (iii) any partnership (a) the
sole general partner or the managing general partner of which is the parent or
a subsidiary of the parent or (b) the only general partners which are the
parent and/or one or more subsidiaries of the parent and (iv) any other
person that is otherwise Controlled by the parent and/or one or more subsidiaries
of the parent.


 


“Subsidiary” shall mean any subsidiary of Borrower.


 


“Subsidiary Guarantor” shall mean each
Subsidiary listed on Schedule 1.01(a), and each other Subsidiary
that is or becomes a party to this Agreement pursuant to Section 5.11,
other than a Foreign Subsidiary.


 


“Supermajority Lenders” shall mean at any
time, Lenders having Loans, LC Exposure and unused Revolving and Term B
Commitments representing at least 66 2/3% of the sum of all Loans outstanding,
LC Exposure and unused Revolving and Term B Commitments at such time.


 


“Swingline Commitment” shall mean the
commitment of the Swingline Lender to make loans pursuant to Section 2.17,
as the same may be reduced from time to time pursuant to Section 2.07
or Section 2.17.


 


“Swingline Exposure” shall mean at any time
the aggregate principal amount at such time of all outstanding Swingline Loans.  The Swingline Exposure of any Revolving
Lender at any time shall equal its Pro Rata Percentage of the aggregate
Swingline Exposure at such time.


 


“Swingline Lender” shall have the meaning
assigned to such term in the preamble hereto.


 


“Swingline Loan” shall mean any loan made by
the Swingline Lender pursuant to Section 2.17.


 


“Syndication Agent” shall have the meaning
assigned to such term in the preamble hereto.


 


“Tax Return” shall mean all returns,
statements, filings, attachments and other documents or certifications required
to be filed in respect of Taxes.


 


“Tax Sharing Agreements” shall mean all tax
sharing, tax allocation and other similar agreements entered into by Borrower
or any subsidiary of Borrower.


 


25





















 


“Taxes” shall mean (i) any and all
present or future taxes, duties, levies, imposts, assessments, deductions,
withholdings or other similar charges, whether computed on a separate,
consolidated, unitary, combined or other basis and any and all liabilities
(including interest, fines, penalties or additions to tax) with respect to the
foregoing, and (ii) any transferee, successor, joint and several,
contractual or other liability (including, without limitation, liability
pursuant to Treasury Regulation § 1.1502-6 (or any similar provision of
state, local or non U.S. law)) in respect of any item described in clause (i).


 


“Term B Borrowing” shall mean a Borrowing
comprised of Term B Loans.


 


“Term B Commitment” shall mean, with respect
to each Lender, the commitment, if any, of such Lender to make a Term B Loan
hereunder on the Third Amendment and Restatement Effective Date in the amount
set forth on Schedule I to the Lender Addendum executed and
delivered by such Lender, or in the Assignment and Acceptance pursuant to which
such Lender shall have assumed its Term B Commitment, as applicable, as the
same may be (a) reduced from time to time pursuant to Section 2.07
and (b) reduced or increased from time to time pursuant to assignments by
or to such Lender pursuant to Section 11.04.  The aggregate amount of the Lenders’ Term B
Commitments on the Third Amendment and Restatement Effective Date shall be $90.0
million.


 


“Term B Lender” shall mean a Lender with a
Term B Commitment or an outstanding Term B Loan.  Each Term B Loan shall be either an ABR Term
Loan or a Eurodollar Term B Loan.


 


“Term B Loan” shall mean a term loan made by
a Lender to Borrower pursuant to Section 2.01(b).


 


“Term B Loan Repayment Date” shall have the
meaning assigned to such term in Section 2.09(a).


 


“Term B Loans” shall mean the Term B Loans,
collectively.


 


“Term B Maturity Date” shall mean the sixth
anniversary of the Third Amendment and Restatement Effective Date or, if such
day is not a Business Day, the immediately preceding Business Day.


 


“Test Period” shall mean, at any time, the
four consecutive fiscal quarters of Borrower then last ended (in each case
taken as one accounting period) for which financial statements have been or are
required to be delivered pursuant to Section 5.01(a) or (b).


 


“Third Amendment and Restatement Effective Date”
shall have the meaning assigned to such term in Section 4.04.


 


“Transactions” shall mean, collectively, the
transactions to occur on or prior to the Third Amendment and Restatement
Effective Date pursuant to the Loan Documents, including (a) the execution
and delivery of the Loan Documents and the initial borrowings hereunder and (b) the
payment of all fees and expenses to be paid on or prior to the Third Amendment
and Restatement Effective Date and owing in connection with the foregoing.


 


“Type,” when used in reference to any Loan
or Borrowing, refers to whether the rate of interest on such Loan, or on the
Loans comprising such Borrowing, is determined by reference to the Adjusted
LIBOR Rate or the Alternate Base Rate.


 


“UCC” shall mean the Uniform Commercial Code
as in effect in the applicable state or jurisdiction.


 


26





















 


“Voting Stock” shall mean any class or
classes of capital stock of Borrower pursuant to which the holders thereof have
the general voting power under ordinary circumstances to elect at least a
majority of the Board of Directors of Borrower.


 


“Wholly Owned Subsidiary” shall mean, as to
any person, (a) any corporation 100% of whose capital stock (other than
directors’ qualifying shares) is at the time owned by such person and/or one or
more Wholly Owned Subsidiaries of such person and (b) any partnership,
association, joint venture, limited liability company or other entity in which
such person and/or one or more Wholly Owned Subsidiaries of such person have a
100% equity interest at such time.


 


“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.    Classification of Loans and Borrowings.  For purposes of this Agreement, Loans may be
classified and referred to by Class (e.g.,
a “Revolving Loan”) or by Type (e.g.,
a “Eurodollar Loan”) or by Class and Type (e.g., a “Eurodollar Revolving Loan”).  Borrowings also may be classified and referred
to by Class (e.g., a “Revolving
Borrowing”, “Term B Borrowing”) or by Type (e.g.,
a “Eurodollar Borrowing”) or by Class and Type (e.g., a “Eurodollar Revolving Borrowing”).


 


SECTION 1.03.    Terms Generally.  The definitions of terms herein shall apply
equally to 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”.  Unless the context requires otherwise (a) any
definition of or reference to any Loan Document, agreement, instrument of other
document herein shall be construed as referring to such agreement, instrument
or other document as from time to time amended, supplemented or otherwise
modified (subject to any restrictions on such amendments, supplements or
modifications set forth herein), (b) any reference herein to any person
shall be construed to include such person’s successors and assigns, (c) the
words “herein”, “hereof” and “hereunder”, and words of similar import, shall be
construed to refer to this Agreement in its entirety and not to any particular
provision hereof, (d) all references herein to Articles, Sections,
Exhibits and Schedules shall be construed to refer to Articles and Sections of,
and Exhibits and Schedules to, this Agreement, and (e) the words “asset”
and “property” shall be construed to have the same meaning and effect and to
refer to any and all tangible and intangible assets and properties, including
cash, securities, accounts and contract rights.


 


SECTION 1.04.    Accounting Terms; GAAP.  Except as otherwise expressly provided herein,
all financial statements to be delivered pursuant to this Agreement shall be
prepared in accordance with GAAP as in effect from time to time and all terms
of an accounting or financial nature shall be construed and interpreted in
accordance with GAAP, as in effect on the date hereof unless agreed to by Borrower
and the Required Lenders.


 


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:


 


(a)           to
make Revolving Loans to Borrower, at any time and from time to time on or after
the Third Amendment and Restatement Effective Date until the earlier of the
Business Day


 


27





















 


preceding the Revolving Maturity Date and the
termination of the Commitment of such Lender in accordance with the terms
hereof, in an aggregate principal amount at any time outstanding that will not
result in such Lender’s Revolving Exposure exceeding such Lender’s Revolving Commitment;
and


 


(b)           to
make a Term B Loan to Borrower on the Third Amendment and Restatement Effective
Date in a principal amount not to exceed its Term B Commitment.


 


Amounts paid
or prepaid in respect of Term B Loans may not be reborrowed.  Within the limits set forth in clause (a) above
and subject to the terms, conditions and limitations set forth herein, Borrower
may borrow, pay or prepay and reborrow Revolving Loans.


 


SECTION 2.02.    Loans.


 


(a)           Each
Loan (other than Swingline Loans) shall be made as part of a Borrowing
consisting of Loans made by the Lenders ratably in accordance with their
applicable Commitments; provided
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).  Except for Loans deemed made pursuant to Section 2.17,
(x) ABR Loans comprising any Borrowing shall be in an aggregate principal
amount that is (i) an integral multiple of $1.0 million and not less than
$1.0 million or (ii) equal to the remaining available balance of the
applicable Commitments and (y) the Eurodollar Loans comprising any Borrowing
shall be in an aggregate principal amount that is (i) an integral multiple
of $1.0 million and not less than $1.0 million or (ii) equal to the
remaining available balance of the applicable Commitments.


 


(b)           Subject
to Sections 2.11 and 2.12, each Borrowing shall be comprised
entirely of ABR Loans or Eurodollar Loans as 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 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
that Borrower shall not be entitled to request any Borrowing that, if made,
would result in more than seven Eurodollar Borrowings outstanding hereunder at
any one 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)           Except
with respect to Loans made pursuant to Section 2.17, 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 3:00 p.m., New
York City time, and the Administrative Agent shall promptly credit the amounts
so received to an account as directed by Borrower in the applicable Borrowing
Request maintained with the Administrative Agent 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
proposed time 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 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


 


28





















 


the Administrative Agent, such
Lender and 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 Borrower until the
date such amount is repaid to the Administrative Agent at (i) in the case
of Borrower, the interest rate applicable at the time to the Loans comprising
such Borrowing and (ii) in the case of such Lender, the greater of the
Federal Funds Effective Rate and a rate determined by the Administrative Agent
in accordance with banking industry rules on interbank compensation.  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.


 


(e)           Notwithstanding
any other provision of this Agreement, Borrower shall not be entitled to
request, or to elect to convert or continue, any Borrowing if the Interest
Period requested with respect thereto would end after the Revolving Maturity
Date or the Term B Maturity Date, as applicable.


 


SECTION 2.03.    Borrowing Procedure.  To request a Revolving Borrowing or Term B Borrowing,
Borrower shall deliver, by hand delivery or telecopy, a duly completed and
executed Borrowing Request to the Administrative Agent (i) in the case of
a Eurodollar Borrowing in dollars, not later than noon, New York City time,
three Business Days before the date of the proposed Borrowing or (ii) in
the case of an ABR Borrowing, not later than 1:00 p.m., New York City
time, on the date of the proposed Borrowing. 
Each Borrowing Request shall be irrevocable and shall specify the
following information in compliance with Section 2.02:


 


(a)           whether
the requested Borrowing is to be a Revolving Borrowing or a Term B Borrowing;


 


(b)           the
aggregate amount of such Borrowing;


 


(c)           the
date of such Borrowing, which shall be a Business Day;


 


(d)           whether
such Borrowing is to be an ABR Borrowing or a Eurodollar Borrowing;


 


(e)           in
the case of a Eurodollar Borrowing, the initial Interest Period to be
applicable thereto, which shall be a period contemplated by the definition of
the term “Interest Period”;


 


(f)            the
location and number of Borrower’s account to which funds are to be disbursed,
which shall comply with the requirements of Section 2.02; and


 


(g)           that
the conditions set forth in Sections 4.02 (b)-(e) are
satisfied as of the date of the notice.


 


If no election
as to the Type of Borrowing is specified, then the requested Borrowing shall be
an ABR Borrowing.  If no Interest Period
is specified with respect to any requested Eurodollar Borrowing, then Borrower
shall be deemed to have selected an Interest Period of one month’s
duration.  Promptly following receipt of
a Borrowing Request in accordance with this Section, the Administrative Agent
shall advise each Lender of the details thereof and of the amount of such
Lender’s Loan to be made as part of the requested Borrowing.


 


SECTION 2.04.    Evidence
of Debt; Repayment of Loans.


 


(a)           Borrower
hereby unconditionally promises to pay (i) to the Administrative Agent for
the account of each Lender holding Term B Loans, the principal amount of each
Term B Loan of such Lender as provided in Section 2.09, (ii) to
the Administrative Agent for the account of each Revolving Lender,


 


29





















 


the then unpaid principal
amount of each Revolving Loan of such Lender on the Revolving Maturity Date and
(iii) to the Swingline Lender the then unpaid principal amount of each
Swingline Loan on the earlier of the Revolving Maturity Date and the first date
after such Swingline Loan is made that is the 15th or last day of a calendar
month and is at least two Business Days after such Swingline Loan is made; provided that on each date that a
Revolving Borrowing is made, Borrower shall repay all Swingline Loans that were
outstanding on the date such Borrowing was requested.


 


(b)           Each
Lender shall maintain in accordance with its usual practice an account or
accounts evidencing the indebtedness of 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 and Class thereof and the
Interest Period applicable thereto; (ii) the amount of any principal or
interest due and payable or to become due and payable from Borrower to each
Lender hereunder; and (iii) the amount of any sum received by the
Administrative Agent hereunder for the account of the Lenders 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 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 Borrower to repay the Loans in
accordance with their terms.


 


(e)           Any
Lender may request that Loans of any Class made by it be evidenced by a
promissory note.  In such event, Borrower
shall prepare, execute and deliver to such Lender a promissory note payable to
the order of such Lender (or, if requested by such Lender, to such Lender and
its registered assigns) in the form of Exhibits G-1, G-2, G-3,
G-4 and G-5, as the case may be. 
Thereafter, the Loans evidenced by such promissory note and interest
thereon shall at all times (including after assignment pursuant to Section 11.04)
be represented by one or more promissory notes in such form payable to the
order of the payee named therein (or, if such promissory note is a registered
note, to such payee and its registered assigns).


 


SECTION 2.05.    Fees.


 


(a)           Commitment
Fee.  Borrower shall pay to the
Administrative Agent for the account of each Lender a commitment fee (a “Commitment Fee”) equal to the Applicable
Fee per annum on the average daily unused amount of each Commitment of such
Lender during the period from and including the Closing Date to but excluding
the date on which such Commitment terminates. 
Accrued Commitment Fees shall be payable in arrears on the last day of
March, June, September and December of each year and on the date on
which the Revolving Commitments terminate, commencing on the first such date to
occur after the date hereof.  All Commitment
Fees shall be computed on the basis of a year of 360 days and shall be payable
for the actual number of days elapsed (including the first day but excluding
the last day).  For purposes of computing
Commitment Fees with respect to Revolving Commitments, a Revolving Commitment
of a Lender shall be deemed to be used to the extent of the outstanding
Revolving Loans and LC Exposure of such Lender (and the Swingline Exposure of
such Lender shall be disregarded for such purpose).


 


(b)           Administrative
Agent Fees.  Borrower shall pay to
the Administrative Agent, for its own account, the administrative fees set
forth in the Fee Letter or such other fees payable in the amounts and at


 


30





















 


the times separately agreed
upon between Borrower and the Administrative Agent (the “Administrative Agent Fees”).


 


(c)           LC
and Fronting Fees.  Borrower shall
pay (i) to the Administrative Agent for the account of each Revolving
Lender a participation fee (“LC Participation
Fee”) with respect to its participations in Letters of Credit, which
shall accrue at a rate equal to the Applicable Margin from time to time used to
determine the interest rate on Eurodollar Revolving Loans pursuant to Section 2.06
on the average daily amount of such Lender’s LC Exposure (excluding any portion
thereof attributable to Reimbursement Obligations) during the period from and
including the Closing Date to but excluding the later of the date on which such
Lender’s Revolving Commitment terminates and the date on which such Lender
ceases to have any LC Exposure, and (ii) to the Issuing Bank a fronting
fee (“Fronting Fee”), which shall
accrue at the rate of 0.125% per annum on the average daily amount of the LC
Exposure (excluding any portion thereof attributable to Reimbursement
Obligations) during the period from and including the Closing Date to but
excluding the later of the date of termination of the Revolving Commitments and
the date on which there ceases to be any LC Exposure, as well as the Issuing
Bank’s standard fees with respect to the issuance, amendment, renewal or
extension of any Letter of Credit or processing of drawings thereunder.  LC Participation Fees and Fronting Fees
accrued through and including the last day of March, June, September and December of
each year shall be payable on the third Business Day following such last day,
commencing on the first such date to occur after the Closing Date; provided that all such fees shall be
payable on the date on which the Revolving Commitments terminate and any such
fees accruing after the date on which the Revolving Commitments terminate shall
be payable on demand.  Any other fees payable
to the Issuing Bank pursuant to this paragraph shall be payable within 10 days
after demand.  All LC Participation Fees
and Fronting Fees shall be computed on the basis of a year of 360 days and
shall be payable for the actual number of days elapsed (including the first day
but excluding the last day).


 


(d)           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, except that Borrower shall pay the Fronting Fees directly to the
Issuing Bank.  Once paid, none of the
Fees shall be refundable under any circumstances.


 


SECTION 2.06.    Interest on Loans.


 


(a)           Subject
to the provisions of Section 2.06(c), the Loans comprising each ABR
Borrowing, including each Swingline Loan, shall bear interest at a rate per
annum equal to the Alternate Base Rate plus
the Applicable Margin in effect from time to time.


 


(b)           Subject
to the provisions of Section 2.06(c), the Loans comprising each
Eurodollar Borrowing shall bear interest at a rate per annum equal to the
Adjusted LIBOR Rate for the Interest Period in effect for such Borrowing plus the Applicable Margin in effect from
time to time.


 


(c)           Notwithstanding
the foregoing, if any principal of or interest on any Loan or any fee or other
amount payable by Borrower hereunder is not paid when due, whether at stated
maturity, upon acceleration or otherwise, such overdue amount shall bear
interest, after as well as before judgment, at a rate per annum equal to (i) in
the case of overdue principal of any Loan, 2% plus the rate otherwise applicable
to such Loan as provided in the preceding paragraphs of this Section or (ii) in
the case of any other amount, 2% plus the rate applicable to ABR Revolving
Loans as provided in paragraph (a) of this Section 2.06.


 


(d)           Accrued
interest on each Loan shall be payable in arrears on each Interest Payment Date
for such Loan and, in the case of Revolving Loans, upon termination of the
Revolving Commitments;


 


31





















 


provided that (i) interest accrued
pursuant to paragraph (c) of this Section shall be payable on demand,
(ii) in the event of any repayment or prepayment of any Loan (other than a
prepayment of an ABR Revolving Loan prior to the end of the Revolving
Availability Period), accrued interest on the principal amount repaid or
prepaid shall be payable on the date of such repayment or prepayment and (iii) in
the event of any conversion of any Eurodollar Loan prior to the end of the
current Interest Period therefor, accrued interest on such Loan shall be
payable on the effective date of such conversion.


 


(e)           All
interest hereunder shall be computed on the basis of a year of 360 days, except
that interest computed by reference to the Alternate Base Rate shall be
computed on the basis of a year of 365 days (or 366 days in a leap year), and
in each case shall be payable for the actual number of days elapsed (including
the first day but excluding the last day). 
The applicable Alternate Base Rate or Adjusted LIBOR Rate shall be
determined by the Administrative Agent in accordance with the provisions of
this Agreement and such determination shall be conclusive absent manifest
error.


 


SECTION 2.07.    Termination and Reduction of Commitments.


 


(a)           The
Original Term B Commitments terminated on the Closing Date.  The Term B Commitments shall automatically
terminate at 5:00 p.m., New York City time, on the Third Amendment and
Restatement Effective Date.  The Original
Revolving Commitments terminated on the Third Amendment and Restatement
Effective Date.  The Revolving
Commitments and the Swingline Commitment shall automatically terminate on the
Revolving Maturity Date and the LC Commitment shall automatically terminate on
the date that is fifteen Business Days prior to the Revolving Maturity Date.


 


(b)           Borrower
may at any time terminate, or from time to time reduce, the Commitments of any
Class; provided that (i) each
reduction of the Commitments of any Class shall be in an amount that is an
integral multiple of $1.0 million and not less than $1.0 million and (ii) the
Revolving Commitments shall not be terminated or reduced if, after giving
effect to any concurrent prepayment of the Revolving Loans in accordance with Section 2.10,
the sum of the Revolving Exposures would exceed the aggregate amount of
Revolving Commitments.


 


(c)           Borrower
shall notify the Administrative Agent of any election to terminate or reduce
the Commitments under paragraph (b) of this Section at least three
Business Days prior to the effective date of such termination or reduction,
specifying such election and the effective date thereof.  Promptly following receipt of any notice, the
Administrative Agent shall advise the Lenders of the contents thereof.  Each notice delivered by Borrower pursuant to
this Section shall be irrevocable; provided
that a notice of termination of the Commitments delivered by Borrower may state
that such notice is conditioned upon the effectiveness of other credit facilities,
in which case such notice may be revoked by Borrower (by notice to the
Administrative Agent on or prior to the specified effective date) if such
condition is not satisfied.  Any
termination or reduction of the Commitments of any Class shall be
permanent.  Each reduction of the
Commitments of any Class shall be made ratably among the Lenders in
accordance with their respective Commitments of such Class.


 


SECTION 2.08.    Interest Elections.


 


(a)           Each
Revolving Borrowing and Term B Borrowing initially shall be of the Type
specified in the applicable Borrowing Request and, in the case of a Eurodollar
Borrowing, shall have an initial Interest Period as specified in such Borrowing
Request.  Thereafter, Borrower may elect
to convert such Borrowing to a different Type or to continue such Borrowing
and, in the case of a Eurodollar Borrowing, may elect Interest Periods
therefor, all as provided in this Section. 
Borrower may elect different options with respect to different portions
of the affected Borrowing, in which case each such portion shall be allocated
ratably among the Lenders holding the Loans comprising such Borrowing, and the
Loans


 


32





















 


comprising each such portion
shall be considered a separate Borrowing. 
Notwithstanding anything to the contrary, Borrower shall not be entitled
to request any conversion or continuation that, if made, would result in more
than seven Eurodollar Borrowings outstanding hereunder at any one time.  This Section shall not apply to
Swingline Borrowings, which may not be converted or continued.


 


(b)           To
make an election pursuant to this Section, Borrower shall notify the
Administrative Agent of such election by telephone by the time that a Borrowing
Request would be required under Section 2.03 if Borrower were
requesting a Revolving Borrowing of the Type resulting from such election to be
made on the effective date of such election. 
Each such telephonic Interest Election Request shall be irrevocable and
shall be confirmed promptly by hand delivery or telecopy to the Administrative
Agent of a written Interest Election Request.


 


(c)           Each
telephonic and written Interest Election Request shall specify the following
information in compliance with Section 2.02:


 


(i)            the
Borrowing to which such Interest Election Request applies and, if different
options are being elected with respect to different portions thereof, the portions
thereof to be allocated to each resulting Borrowing (in which case the
information to be specified pursuant to clauses (iii) and (iv) below
shall be specified for each resulting Borrowing);


 


(ii)           the
effective date of the election made pursuant to such Interest Election Request,
which shall be a Business Day;


 


(iii)          whether
the resulting Borrowing is to be an ABR Borrowing or a Eurodollar Borrowing;
and


 


(iv)          if
the resulting Borrowing is a Eurodollar Borrowing, the Interest Period to be
applicable thereto after giving effect to such election, which shall be a
period contemplated by the definition of the term “Interest Period”.


 


If any such
Interest Election Request requests a Eurodollar Borrowing but does not specify
an Interest Period, then such Borrower shall be deemed to have selected an
Interest Period of one month’s duration.


 


(d)           Promptly
following receipt of an Interest Election Request, the Administrative Agent
shall advise each Lender of the details thereof and of such Lender’s portion of
each resulting Borrowing.


 


(e)           If
an Interest Election Request with respect to a Eurodollar Borrowing is not
timely delivered prior to the end of the Interest Period applicable thereto,
then, unless such Borrowing is repaid as provided herein, at the end of such
Interest Period such Borrowing shall be converted to an ABR Borrowing.  Notwithstanding any contrary provision
hereof, if an Event of Default has occurred and is continuing and the Administrative
Agent, at the request of the Required Lenders, so notifies Borrower, then,
after the occurrence and during the continuance of such Event of Default (i) no
outstanding Borrowing may be converted to or continued as a Eurodollar
Borrowing and (ii) unless repaid, each Eurodollar Borrowing shall be
converted to an ABR Borrowing at the end of the Interest Period applicable
thereto.


 


SECTION 2.09.    Amortization of Term B Borrowings.


 


(a)           Borrower
shall pay to the Administrative Agent, for the account of the Lenders, on the
dates set forth on Annex II, or if any such date is not a Business Day, on the
next preceding Business Day (each such date being a “Term B Loan Repayment Date”), a principal amount of the Term B
Loans (as


 


33





















 


adjusted from time to time
pursuant to Section 2.10(h)) equal to the amount set forth on Annex
II for such date, together in each case with accrued and unpaid interest on
the principal amount to be paid to but excluding the date of such payment.


 


(b)           To
the extent not previously paid, (i)  all Term B Loans shall be due and
payable on the Term B Maturity Date.


 


(c)           Any
prepayment of a Term B Borrowing of any Class shall be applied to reduce
the subsequent scheduled repayments of the Term B Borrowings of such Class to
be made pursuant to this Section ratably. 
Notwithstanding the foregoing, any prepayment of Eurodollar Term B
Borrowings made pursuant to Section 2.10 on a date that is (i) the
last day of an Interest Period and (ii) no more than five days prior to a
scheduled amortization payment pursuant this Section 2.09 shall be
applied, first, to reduce such scheduled payment, and any excess shall be
applied as required by the preceding sentence.


 


SECTION 2.10.    Optional and Mandatory Prepayments of Loans.


 


(a)           Optional
Prepayments.  Borrower shall have the
right at any time and from time to time to prepay any Borrowing, in whole or in
part, subject to the requirements of this Section; provided that each partial prepayment shall be in an amount
that is an integral multiple of $250,000 and not less than $1.0 million.


 


(b)           Revolving
Loan Prepayments.


 


(i)            In
the event of the termination of all the Revolving Commitments, Borrower shall,
on the date of such termination, repay or prepay all its outstanding Revolving
Borrowings and all outstanding Swingline Loans and replace all outstanding
Letters of Credit and/or deposit an amount equal to the LC Exposure in the LC
Sub Account.


 


(ii)           In
the event of any partial reduction of the Revolving Commitments, then (x) at or
prior to the effective date of such reduction, the Administrative Agent shall
notify Borrower and the Revolving Lenders of the sum of the Revolving Exposures
after giving effect thereto and (y) if the sum of the Revolving Exposures would
exceed the aggregate amount of Revolving Commitments after giving effect to
such reduction, then Borrower shall, on the date of such reduction, first, repay or prepay Swingline Loans,
and second, repay or prepay
Revolving Borrowings and third, replace or cash collateralize outstanding
Letters of Credit in accordance with the procedures set forth in Section 2.18(i),
in an amount sufficient to eliminate such excess.


 


(iii)          In
the event that the sum of all Lenders’ Revolving Exposures exceeds the
Revolving Commitments then in effect, Borrower shall, without notice or demand,
immediately first, repay or
prepay Revolving Borrowings, and second,
replace or cash collateralize outstanding Letters of Credit in accordance with
the procedures set forth in Section 2.18(i).


 


(iv)          In
the event that the aggregate LC Exposure exceeds the LC Commitment then in
effect, Borrower shall, without notice or demand, immediately replace or cash
collateralize outstanding Letters of Credit in accordance with the procedures
set forth in Section 2.18(i).


 


(c)           Asset
Sales.  Not later than five Business
Days following the receipt of any Net Cash Proceeds of any Asset Sale, Borrower
or any of its Subsidiaries shall apply 100% of the Net Cash Proceeds received
with respect thereto to make prepayments in accordance with Sections 2.10(h) and
(i); provided that:


 


34





















 


(i)            no
such prepayment shall be required with respect to (A) any Asset Sale
permitted by Section 6.05(a)(i), (c), (d) or (g),
(B) the disposition of assets subject to a condemnation or eminent domain
proceeding or insurance settlement to the extent it does not constitute a
Casualty Event, or (C) Asset Sales for fair market value resulting in no
more than $2.0 million in Net Cash Proceeds per Asset Sale (or series of
related Asset Sales) and less than $7.5 million in Net Cash Proceeds in any
fiscal year, and in each of the cases of (A), (B) and (C), the proceeds of
such dispositions shall not be deposited in the Collateral Account; and


 


(ii)           so
long as no Default shall then exist or would arise therefrom and the aggregate
of such Net Cash Proceeds of Asset Sales shall not exceed $7.5 million in any
fiscal year of Borrower, such proceeds shall not be required to be so applied
on such date to the extent that (A) Borrower shall have delivered an
Officers’ Certificate to the Administrative Agent on or prior to such date
stating that such Net Cash Proceeds shall be used to purchase replacement
assets or acquire 100% of the Equity Interests of any person that owns such
assets no later than 180 days following the date of such Asset Sale (which
Officers’ Certificate shall set forth the estimates of the proceeds to be so
expended); and (B) all such Net Cash Proceeds in excess of $5.0 million in
the aggregate at any time shall be held in the Collateral Account and released
therefrom only in accordance with the provisions of Article IX; provided that if all or any portion of
such Net Cash Proceeds not required to be applied to the prepayment of
outstanding Term B Loans shall not be utilized to purchase replacement assets
or acquire such Equity Interests within such 180 day period, such unused
portion shall be applied on the last day of such period as a mandatory
prepayment of principal of outstanding Term B Loans as provided in this Section 2.10(c);
and provided, further,
that if the property subject to such Asset Sale constituted Collateral, then
all property purchased with the Net Cash Proceeds thereof pursuant to this subsection shall
be made subject to the Lien of the applicable Security Documents in favor of
the Collateral Agent, for its benefit and for the benefit of the other Secured
Parties in accordance with Sections 5.11 and 5.12.


 


(d)           Debt
Issuance.  Upon any Debt Issuance
after the Closing Date, Borrower shall make prepayments in accordance with Sections
2.10(h) and (i) in an aggregate principal amount equal to
100% of the Net Cash Proceeds of such Debt Issuance.


 


(e)           Equity
Issuance.  Upon any Equity Issuance
after the Closing Date, Borrower shall make prepayments in accordance with Sections
2.10(h) and (i) in an aggregate principal amount equal to
50% of the Net Cash Proceeds of such Equity Issuance.


 


(f)            Casualty
Events.  Not later than five Business
Days following the receipt (or, if received by the Collateral Agent, notice to Borrower
of such receipt) of any Net Cash Proceeds from a Casualty Event, Borrower shall
apply an amount equal to 100% of such Net Cash Proceeds to make prepayments in
accordance with Sections 2.10(h) and (i); provided that:


 


(i)            so
long as no Default shall then exist or arise therefrom, such proceeds shall not
be required to be so applied on such date to the extent that (A) in the
event such Net Cash Proceeds shall not exceed $2.5 million, Borrower shall have
delivered an Officers’ Certificate to the Administrative Agent on or prior to
such date stating that such proceeds shall be used; or (B) in the event
that such Net Cash Proceeds exceed $2.5 million, the Administrative Agent has
elected by notice to Borrower on or prior to such date to require such proceeds
to be used, in each case, to repair, replace or restore any property in respect
of which such Net Cash Proceeds were paid no later than 180 days following the
date of receipt of such proceeds (which Officers’ Certificate shall set forth
the estimates of the proceeds to be so expended); provided that if the property subject to such Casualty Event
constituted Collateral under the Security Documents, then all property


 


35





















 


purchased with the Net Cash Proceeds thereof pursuant to this subsection shall
be made subject to the Lien of the applicable Security Documents in favor of
the Collateral Agent, for its benefit and for the benefit of the other Secured
Parties in accordance with Sections 5.11 and 5.12;


 


(ii)           all
such Net Cash Proceeds in excess of $7.5 million in the aggregate shall be held
in the Collateral Account and released therefrom only in accordance with the
provisions of Article IX;


 


(iii)          if
all or any portion of such Net Cash Proceeds shall not be so applied within
such 180 day period, such unused portion shall be applied on the last day of
such period as a mandatory prepayment of principal of outstanding Term B Loans
as provided in this Section 2.10(f); and


 


(iv)          in
the event Collateral Agent receives any Net Cash Proceeds that would otherwise
be from a Casualty Event except that such proceeds do not exceed $2.5 million,
Collateral Agent will promptly deliver such Net Cash Proceeds to Borrower.


 


(g)           [Intentionally
omitted]


 


(h)           Application
of Prepayments.  Any prepayments of
Loans pursuant to Section 2.10(c), (d), (e) or (f) shall
be applied to reduce scheduled payments of Term B Loans required under Section 2.09(a) on
a pro rata basis among the payments due on each Term B Loan Repayment Date
based on the payments then due on each Term B Loan Repayment Date.  After application of mandatory prepayments described
above in this paragraph (h) and to the extent there are mandatory
prepayment amounts remaining after such application, the Revolving Commitments
shall be reduced ratably among the Revolving Lenders in accordance with their applicable
Revolving Commitments in an aggregate amount equal to such excess, and Borrower
shall comply with Section 2.10(b).


 


Optional
prepayments of Term B Loans pursuant to Section 2.10(a) shall
be applied as designated by Borrower. 
Other amounts to be applied pursuant to this Section 2.10 to
the prepayment of Term B Loans and Revolving Loans shall be applied, as
applicable, first to reduce outstanding ABR Term Loans and ABR Revolving Loans,
respectively.  Any amounts remaining
after each such application shall be applied to prepay Eurodollar Term B Loans
or Eurodollar Revolving Loans, as applicable. 
Notwithstanding the foregoing, if the amount of any prepayment of Loans
required under this Section 2.10 shall be in excess of the amount
of the ABR Loans at the time outstanding, only the portion of the amount of
such prepayment as is equal to the amount of such outstanding ABR Loans shall
be immediately prepaid and, at the election of Borrower, the balance of such
required prepayment shall be either (A) deposited in the Collateral
Account and applied to the prepayment of Eurodollar Loans on the last day of
the then next expiring Interest Period for Eurodollar Loans (with all interest
accruing thereon for the account of Borrower) or (B) prepaid immediately,
together with any amounts owing to the Lenders under Section 2.13.  Notwithstanding any such deposit in the
Collateral Account, interest shall continue to accrue on such Loans until prepayment.


 


(i)            Notice
of Prepayment.  Borrower shall notify
the Administrative Agent (and, in the case of prepayment of a Swingline Loan,
the Swingline Lender) by telephone (confirmed by telecopy) of any prepayment
hereunder (i) in the case of prepayment of a Eurodollar Borrowing, not
later than 11:00 a.m., New York City time, three Business Days before the
date of prepayment, (ii) in the case of prepayment of an ABR Borrowing,
not later than 11:00 a.m., New York City time, one Business Day before the
date of prepayment or (iii) in the case of prepayment of a Swingline Loan,
not later than 11:00 a.m., New York City time, on the date of
prepayment.  Each such notice shall be
irrevocable; provided that, if a
notice of prepayment is given in connection with a conditional notice of
termination of the Commitments as


 


36





















 


contemplated by Section 2.07,
then such notice of prepayment may be revoked if such termination is revoked in
accordance with Section 2.07(c). 
Each such notice shall specify the prepayment date, the principal amount
of each Borrowing or portion thereof to be prepaid and, in the case of (A) a
mandatory prepayment, a reasonably detailed calculation of the amount of such
prepayment or (B) an optional prepayment of a Term B Loan, reasonably
detailed instructions designating application of such prepayment.  Promptly following receipt of any such notice
(other than a notice relating solely to Swingline Loans), the Administrative
Agent shall advise the Lenders of the contents thereof.  Each partial prepayment of any Borrowing shall
be in an amount that would be permitted in the case of an advance of a
Borrowing of the same Type as provided in Section 2.02, except as
necessary to apply fully the required amount of a mandatory prepayment.  Each prepayment of a Borrowing shall be applied
ratably to the Loans included in the prepaid Borrowing.  Prepayments shall be accompanied by accrued
interest to the extent required by Section 2.06.


 


SECTION 2.11.    Alternate Rate of Interest.  If prior to the commencement of any Interest
Period for a Eurodollar Borrowing:


 


(a)           the
Administrative Agent determines (which determination shall be conclusive absent
manifest error) that adequate and reasonable means do not exist for
ascertaining the Adjusted LIBOR Rate for such Interest Period; or


 


(b)           the
Administrative Agent is advised by the Required Lenders that the Adjusted LIBOR
Rate for such Interest Period will not adequately and fairly reflect the cost
to such Lenders of making or maintaining their Loans included in such Borrowing
for such Interest Period;


 


then the
Administrative Agent shall give notice thereof to Borrower and the Lenders by
telephone or telecopy as promptly as practicable thereafter and, until the
Administrative Agent notifies Borrower and the Lenders that the circumstances
giving rise to such notice no longer exist, (i) any Interest Election
Request that requests the conversion of any Borrowing to, or continuation of
any Borrowing as, a Eurodollar Borrowing shall be ineffective and (ii) if
any Borrowing Request requests a Eurodollar Borrowing, such Borrowing shall be
made as an ABR Borrowing.


 


SECTION 2.12.    Increased Costs.


 


(a)           If
any Change in Law shall:


 


(i)            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 reflected in the Adjusted LIBOR
Rate) or the Issuing Bank; or


 


(ii)           impose
on any Lender or the Issuing Bank or the London interbank market any other
condition affecting this Agreement or Eurodollar Loans made by such Lender or
any Letter of Credit or participation therein;


 


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


 


37





















 


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


 


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


 


(d)           Failure
or delay on the part of any Lender or the Issuing Bank to demand compensation
pursuant to this Section shall not constitute a waiver of such Lender’s or
the Issuing Bank’s right to demand such compensation; provided that Borrower shall not be
required to compensate a Lender or the Issuing Bank pursuant to this Section for
any increased costs or reductions incurred more than 180 days prior to the date
that such Lender or the Issuing Bank, as the case may be, notifies Borrower of
the Change in Law giving rise to such increased costs or reductions and of such
Lender’s or the Issuing Bank’s intention to claim compensation therefor; provided, further, that,
if the Change in Law giving rise to such increased costs or reductions is
retroactive, then the 180 day period referred to above shall not begin earlier
than the date of effectiveness of the Change in Law.


 


SECTION 2.13.    Breakage Payments.  In the event of (a) the payment or
prepayment, whether optional or mandatory, of any principal of any Eurodollar
Loan other than on the last day of an Interest Period applicable thereto
(including as a result of an Event of Default), (b) the conversion of any
Eurodollar Loan other than on the last day of the Interest Period applicable
thereto, (c) the failure to borrow, convert, continue or prepay any
Revolving Loan or Term B Loan on the date specified in any notice delivered
pursuant hereto or (d) the assignment of any Eurodollar Loan other than on
the last day of the Interest Period applicable thereto as a result of a request
by Borrower pursuant to Section 2.16, then, in any such event, Borrower
shall compensate each Lender for the loss, cost and expense attributable to
such event.  In the case of a Eurodollar
Loan, such loss, cost or expense to any Lender shall be deemed to include an
amount determined by such Lender to be the excess, if any, of (i) the
amount of interest which would have accrued on the principal amount of such
Loan had such event not occurred, at the Adjusted LIBOR Rate that would have
been applicable to such Loan, for the period from the date of such event to the
last day of the then current Interest Period therefor (or, in the case of a
failure to borrow, convert or continue, for the period that would have been the
Interest Period for such Loan), over (ii) the amount of interest which
would accrue on such principal amount for such period at the interest rate
which such Lender would bid were it to bid, at the commencement of such period,
for dollar deposits of a comparable amount and period from other banks in the
Eurodollar market.  A certificate of any
Lender setting forth any amount or amounts that such Lender is entitled to
receive pursuant to this Section shall be delivered to Borrower and shall
be conclusive absent manifest error.  Borrower
shall pay such Lender the amount shown as due on any such certificate within 10
days after receipt thereof.


 


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SECTION 2.14.    Payments Generally; Pro Rata Treatment;
Sharing of Setoffs.


 


(a)           Borrower
shall make each payment required to be made by it hereunder or under any other
Loan Document (whether of principal, interest, fees or reimbursement of LC
Disbursements, or of amounts payable under Section 2.12, 2.13
or 2.15, or otherwise) on or before the time expressly required
hereunder or under such other Loan Document for such payment (or, if no such
time is expressly required, prior to 2:00 p.m., New York City time), on
the date when due, in immediately available funds, without setoff or
counterclaim.  Any amounts received after
such time on any date may, in the discretion of the Administrative Agent, be
deemed to have been received on the next succeeding Business Day for purposes
of calculating interest thereon.  All
such payments shall be made to the Administrative Agent at its offices at 677
Washington Boulevard, Stamford, Connecticut, except payments to be made
directly to the Issuing Bank or Swingline Lender as expressly provided herein
and except that payments pursuant to Sections 2.12, 2.13, 2.15
and 11.03 shall be made directly to the persons entitled thereto and
payments pursuant to other Loan Documents shall be made to the persons
specified therein.  The Administrative
Agent shall distribute any such payments received by it for the account of any
other person to the appropriate recipient promptly following receipt
thereof.  If any payment under any Loan
Document shall be due on a day that is not a Business Day, the date for payment
shall be extended to the next succeeding Business Day, and, in the case of any
payment accruing interest, interest thereon shall be payable for the period of
such extension.  All payments under each
Loan Document shall be made in dollars.


 


(b)           If
at any time insufficient funds are received by and available to the
Administrative Agent to pay fully all amounts of principal, Reimbursement
Obligations, interest and fees then due hereunder, such funds shall be applied (i) first,
towards payment of interest and fees then due hereunder, ratably among the
parties entitled thereto in accordance with the amounts of interest and fees
then due to such parties, and (ii) second, towards payment of principal
and Reimbursement Obligations then due hereunder, ratably among the parties
entitled thereto in accordance with the amounts of principal and Reimbursement
Obligations then due to such parties.


 


(c)           If
any Lender shall, by exercising any right of setoff or counterclaim or otherwise,
obtain payment in respect of any principal of or interest on any of its
Revolving Loans, Term B Loans or participations in LC Disbursements or
Swingline Loans resulting in such Lender receiving payment of a greater
proportion of the aggregate amount of its Revolving Loans, Term B Loans and
participations in LC Disbursements and Swingline Loans and accrued interest
thereon than the proportion received by any other Lender, then the Lender
receiving such greater proportion shall purchase (for cash at face value)
participations in the Revolving Loans, Term B Loans and participations in LC
Disbursements and Swingline Loans of other Lenders to the extent necessary so
that the benefit of all such payments shall be shared by the Lenders ratably in
accordance with the aggregate amount of principal of and accrued interest on
their respective Revolving Loans, Term B Loans and participations in LC
Disbursements and Swingline Loans; provided
that (i) if any such participations are purchased and all or any portion
of the payment giving rise thereto is recovered, such participations shall be
rescinded and the purchase price restored to the extent of such recovery,
without interest, and (ii) the provisions of this paragraph shall not be
construed to apply to any payment made by Borrower pursuant to and in
accordance with the express terms of this Agreement or any payment obtained by
a Lender as consideration for the assignment of or sale of a participation in
any of its Loans or participations in LC Disbursements to any assignee or participant,
other than to Borrower or any Subsidiary or Affiliate thereof (as to which the
provisions of this paragraph shall apply). 
Borrower consents to the foregoing and agrees, to the extent it may effectively
do so under applicable law, that any Lender acquiring a participation pursuant
to the foregoing arrangements may exercise against Borrower rights of setoff
and counterclaim with respect to such participation as fully as if such Lender
were a direct creditor of Borrower in the amount of such participation.


 


39





















 


(d)           Unless
the Administrative Agent shall have received notice from Borrower prior to the
date on which any payment is due to the Administrative Agent for the account of
the Lenders or the Issuing Bank hereunder that Borrower will not make such
payment, the Administrative Agent may assume that Borrower has made such
payment on such date in accordance herewith and may, in reliance upon such
assumption, distribute to the Lenders or the Issuing Bank, as the case may be,
the amount due.  In such event, if Borrower
has not in fact made such payment, then each of the Lenders or the Issuing
Bank, as the case may be, severally agrees to repay to the Administrative Agent
forthwith on demand the amount so distributed to such Lender or Issuing Bank
with interest thereon, for each day from and including the date such amount is
distributed to it to but excluding the date of payment to the Administrative
Agent, at the greater of the Federal Funds Effective Rate and a rate determined
by the Administrative Agent in accordance with banking industry rules on
interbank compensation.


 


(e)           If
any Lender shall fail to make any payment required to be made by it pursuant to
Section 2.02(c), 2.14(d), 2.17(d), 2.18(d) or
11.03(d), then the Administrative Agent may, in its discretion
(notwithstanding any contrary provision hereof), apply any amounts thereafter
received by the Administrative Agent for the account of such Lender to satisfy
such Lender’s obligations under such Sections until all such unsatisfied obligations
are fully paid.


 


SECTION 2.15.    Taxes.


 


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


 


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


 


(c)           Borrower
shall indemnify the Administrative Agent, each Lender and the Issuing Bank,
within 10 Business Days after written demand therefor, for the full amount of
any Indemnified Taxes or Other Taxes paid by the Administrative Agent, such
Lender or the Issuing Bank, as the case may be, on or with respect to any
payment by or on account of any obligation of Borrower 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 2.15)
and any penalties, interest and reasonable expenses arising therefrom or with
respect thereto, whether or not such Indemnified Taxes or Other Taxes were
correctly or legally imposed or asserted by the relevant Governmental
Authority.  A certificate as to the
amount of such payment or liability delivered to Borrower by a Lender or the Issuing
Bank, or by the Administrative Agent on its own behalf or on behalf of a Lender
or the Issuing Bank, shall be conclusive absent manifest error.


 


(d)           As
soon as practicable after any payment of Indemnified Taxes or Other Taxes by Borrower
to a Governmental Authority, 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.


 


40





















 


(e)           Any
Foreign Lender that is entitled to an exemption from or reduction of
withholding tax under the law of the jurisdiction in which Borrower is located,
or any treaty to which such jurisdiction is a party, with respect to payments
under this Agreement shall deliver to 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 Borrower as will permit such payments to be made
without withholding or at a reduced rate. 
Each Foreign Lender either (1) (i) agrees to furnish either
U.S. Internal Revenue Service Form W 8ECI or U.S. Internal Revenue Service
Form W 8BEN (or successor form) and (ii) agrees (for the benefit of Borrower
and the Administrative Agent), to the extent it may lawfully do so at such
times, upon reasonable request by Borrower or the Administrative Agent, to
provide a new Form W 8ECI or Form W 8BEN (or successor form) upon the
expiration or obsolescence of any previously delivered form to reconfirm any complete
exemption from, or any entitlement to a reduction in, U.S. federal withholding
tax with respect to any interest payment hereunder or (2) in the case of
any such Foreign Lender that is not a “bank” within the meaning of Section 881(c)(3)(A) of
the Code, (i) agrees to furnish either (a) a “Non Bank Certificate”
in a form acceptable to the Administrative Agent and Borrower and two accurate
and complete original signed copies of Internal Revenue Service Form W
8BEN (or successor form) or (b) an Internal Revenue Form W 8ECI (or
successor form), certifying (in each case) to such Foreign Lender’s legal
entitlement to an exemption or reduction from U.S. federal withholding tax with
respect to all interest payments hereunder and (ii) agrees (for the
benefit of Borrower and the Administrative Agent) to the extent it may lawfully
do so at such times, upon reasonable request by Borrower or the Administrative
Agent, to provide a new Form W 8BEN or W 8ECI (or successor form) upon the
expiration or obsolescence of any previously delivered form to reconfirm any
complete exemption from, or any entitlement to a reduction in, U.S. federal withholding
tax with respect to any interest payment hereunder.


 


(f)            If
the Administrative Agent or a Lender (or an assignee) determines in its
reasonable discretion that it has received a refund of any Indemnified Taxes or
Other Taxes as to which it has been indemnified by Borrower or with respect to
which Borrower has paid additional amounts pursuant to this Section 2.15,
it shall pay over such refund to Borrower (but only to the extent of indemnity
payments made, or additional amounts paid, by Borrower under this Section 2.15
with respect to the Indemnified Taxes or the Other Taxes giving rise to such
refund), net of all out of pocket expenses of the Administrative Agent or such
Lender (or assignee) and without interest (other than any interest paid by the
relevant Governmental Authority with respect to such refund); provided, however, that Borrower,
upon the request of the Administrative Agent or such Lender (or assignee),
agrees to repay the amount paid over to Borrower (plus any penalties, interest or other charges imposed by the
relevant Governmental Authority) to the Administrative Agent or such Lender (or
assignee) in the event the Administrative Agent or such Lender (or assignee) is
required to repay such refund to such Governmental Authority.  Nothing contained in this Section 2.15(f) shall
require the Administrative Agent or any Lender (or assignee) to make available
its tax returns or any other information which it deems confidential to Borrower
or any other person.  Notwithstanding
anything to the contrary, in no event will any Lender be required to pay any
amount to Borrower the payment of which would place such Lender in a less
favorable net after tax position than such Lender would have been in had the
additional amounts giving rise to such refund of any Indemnified Taxes or Other
Taxes never been paid in the first place.


 


SECTION 2.16.    Mitigation Obligations; Replacement of
Lenders.


 


(a)           Mitigation
of Obligations.  If any Lender
requests compensation under Section 2.12, or if Borrower is
required to pay any additional amount to any Lender or any Governmental
Authority for the account of any Lender pursuant to Section 2.15,
then such Lender shall use reasonable efforts to designate a different lending
office for funding or booking its Loans hereunder or to assign its rights and obligations
hereunder to another of its offices, branches or affiliates, if, in the
reasonable judgment of such Lender,


 


41





















 


such designation or assignment (i) would
eliminate or reduce amounts payable pursuant to Section 2.12 or 2.15,
as the case may be, in the future and (ii) would not subject such Lender
to any unreimbursed cost or expense and would not otherwise be disadvantageous
to such Lender.  Borrower hereby agrees
to pay all reasonable costs and expenses incurred by any Lender in connection
with any such designation or assignment.


 


(b)           Replacement
of Lenders.  If any Lender requests
compensation under Section 2.12, or if Borrower is required to pay
any additional amount to any Lender or any Governmental Authority for the
account of any Lender pursuant to Section 2.15, or if any Lender
defaults in its obligation to fund Loans hereunder, then Borrower may, at its
sole expense and effort, upon notice to such Lender and the Administrative
Agent, require such Lender to assign and delegate, without recourse (in
accordance with and subject to the restrictions contained in Section 11.04),
all of its interests, rights and obligations under this Agreement to an
assignee selected by Borrower that shall assume such obligations (which
assignee may be another Lender, if a Lender accepts such assignment); provided that (i) Borrower shall have
received the prior written consent of the Administrative Agent (and, if a
Revolving Commitment is being assigned, the Issuing Bank and Swingline Lender),
which consent shall not unreasonably be withheld, (ii) such Lender shall
have received payment of an amount equal to the outstanding principal of its
Loans and participations in LC Disbursements and Swingline Loans, accrued
interest thereon, accrued fees and all other amounts payable to it hereunder,
from the assignee (to the extent of such outstanding principal and accrued
interest and fees) or Borrower (in the case of all other amounts) and (iii) in
the case of any such assignment resulting from a claim for compensation under Section 2.12
or payments required to be made pursuant to Section 2.15, such
assignment will result in a material reduction in such compensation or
payments.  A Lender shall not be required
to make any such assignment and delegation if, prior thereto, as a result of a
waiver by such Lender or otherwise, the circumstances entitling Borrower to
require such assignment and delegation cease to apply.


 


SECTION 2.17.    Swingline Loans.


 


(a)           Swingline
Commitment.  Subject to the terms and
conditions set forth herein, the Swingline Lender agrees to make Swingline
Loans to Borrower from time to time during the Revolving Availability Period,
in an aggregate principal amount at any time outstanding that will not result
in (i) the aggregate principal amount of outstanding Swingline Loans
exceeding $2.5 million or (ii) the sum of the total Revolving Exposures
exceeding the total Revolving Commitments; provided
that the Swingline Lender shall not be required to make a Swingline Loan to
refinance an outstanding Swingline Loan. 
Within the foregoing limits and subject to the terms and conditions set
forth herein, Borrower may borrow, repay and reborrow Swingline Loans.


 


(b)           Swingline
Loans.  To request a Swingline Loan, Borrower
shall notify the Administrative Agent of such request by telephone (confirmed
by telecopy), not later than 2:00 p.m., New York City time, on the day of
a proposed Swingline Loan.  Each such notice
shall be irrevocable, shall specify the requested date (which shall be a
Business Day) and amount of the requested Swingline Loan.  The Administrative Agent will promptly advise
the Swingline Lender of any such notice received from Borrower.  The Swingline Lender shall make each
Swingline Loan available to Borrower by means of a credit to the general
deposit account of Borrower with the Swingline Lender (or, in the case of a
Swingline Loan made to finance the reimbursement of an LC Disbursement as provided
in Section 2.18(e), by remittance to the Issuing Bank) by 3:00 p.m.,
New York City time, on the requested date of such Swingline Loan.  Borrower shall not request a Swingline Loan
if at the time of and immediately after giving effect to such request a Default
has occurred and is continuing. 
Swingline Loans shall be made in minimum amounts of $500,000 and
integral multiples of $100,000 above such amount.


 


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(c)           Prepayment.  Borrower shall have the right at any time and
from time to time to repay any Swingline Loan, in whole or in part, upon giving
written or telecopy notice (or telephone notice promptly confirmed by written,
or telecopy notice) to the Swingline Lender and to the Administrative Agent before
12:00 (noon), New York City time on the date of repayment at the Swingline
Lender’s address for notices specified in the Swingline Lender’s Administrative
Questionnaire.  All principal payments of
Swingline Loans shall be accompanied by accrued interest on the principal
amount being repaid to the date of payment.


 


(d)           Participations.  The Swingline Lender may by written notice
given to the Administrative Agent not later than 12:00 noon, New York City
time, on any Business Day require the Revolving Lenders to acquire
participations on such Business Day in all or a portion of the Swingline Loans
outstanding.  Such notice shall specify
the aggregate amount of Swingline Loans in which Revolving Lenders will
participate.  Promptly upon receipt of
such notice, the Administrative Agent will give notice thereof to each Revolving
Lender, specifying in such notice such Lender’s Pro Rata Percentage of such
Swingline Loan or Loans.  Each Revolving
Lender hereby absolutely and unconditionally agrees, upon receipt of notice as
provided above, to pay to the Administrative Agent, for the account of the
Swingline Lender, such Lender’s Pro Rata Percentage of such Swingline Loan or
Loans.  Each Revolving Lender acknowledges
and agrees that its obligation to acquire participations in Swingline Loans
pursuant to this paragraph is absolute and unconditional and shall not be
affected by any circumstance whatsoever, including the occurrence and
continuance of a Default or reduction or termination of the Commitments, and
that each such payment shall be made without any offset, abatement, withholding
or reduction whatsoever (provided
that such payment shall not cause such Lender’s Revolving Exposure to exceed
such Lender’s Revolving Commitment). 
Each Revolving Lender shall comply with its obligation under this
paragraph by wire transfer of immediately available funds, in the same manner
as provided in Section 2.14 with respect to Loans made by such
Lender (and Section 2.02 shall apply, mutatis mutandis, to the payment obligations of the Revolving
Lenders), and the Administrative Agent shall promptly pay to the Swingline
Lender the amounts so received by it from the Revolving Lenders.  The Administrative Agent shall notify Borrower
of any participations in any Swingline Loan acquired pursuant to this
paragraph, and thereafter payments in respect of such Swingline Loan shall be
made to the Administrative Agent and not to the Swingline Lender.  Any amounts received by the Swingline Lender
from Borrower (or other party on behalf of Borrower) in respect of a Swingline
Loan after receipt by the Swingline Lender of the proceeds of a sale of
participations therein shall be promptly remitted to the Administrative Agent;
any such amounts received by the Administrative Agent shall be promptly remitted
by the Administrative Agent to the Revolving Lenders that shall have made their
payments pursuant to this paragraph and to the Swingline Lender, as their
interests may appear.  The purchase of
participations in a Swingline Loan pursuant to this paragraph shall not relieve
Borrower of any default in the payment thereof.


 


SECTION 2.18.    Letters of Credit.


 


(a)           General.  Subject to the terms and conditions set forth
herein, Borrower may request the Issuing Bank, and the Issuing Bank agrees, to
issue Letters of Credit for its own account or the account of a Subsidiary in a
form reasonably acceptable to the Administrative Agent and the Issuing Bank, at
any time and from time to time during the Revolving Availability Period.  The Issuing Bank shall have no obligation to
issue, and Borrower shall not request the issuance of, any Letter of Credit at
any time if after giving effect to such issuance, the LC Exposure would exceed
the LC Commitment or the total Revolving Exposure would exceed the total
Revolving Commitments.  In the event of
any inconsistency between the terms and conditions of this Agreement and the
terms and conditions of any form of letter of credit application or other
agreement submitted by Borrower to, or entered into by Borrower with, the
Issuing Bank relating to any Letter of Credit, the terms and conditions of this
Agreement shall control.


 


43





















 


(b)           Request
for Issuance, Amendment, Renewal, Extension; Certain Conditions.  To request the issuance of a Letter of Credit
or the amendment, renewal or extension of an outstanding Letter of Credit, Borrower
shall hand deliver or telecopy (or transmit by electronic communication, if
arrangements for doing so have been approved by the Issuing Bank) an LC Request
to the Issuing Bank and the Administrative Agent not later than 11:00 a.m.
on the third Business Day preceding the requested date of issuance, amendment,
renewal or extension (or such later date and time as is acceptable to the
Issuing Bank).


 


A request for
an initial issuance of a Letter of Credit shall specify in form and detail
satisfactory to the Issuing Bank:


 


(i)            the
proposed issuance date of the requested Letter of Credit (which shall be a
Business Day);


 


(ii)           the
amount thereof;


 


(iii)          the
expiry date thereof (which shall not be later than the close of business 15
days prior to the Revolving Maturity Date);


 


(iv)          the
name and address of the beneficiary thereof;


 


(v)           whether
the Letter of Credit is to be issued for its own account or for the account of
a Subsidiary;


 


(vi)          the
documents to be presented by such beneficiary in connection with any drawing
thereunder;


 


(vii)         the
full text of any certificate to be presented by such beneficiary in connection
with any drawing thereunder; and


 


(viii)        such
other matters as the Issuing Bank may reasonably require.


 


A request for
an amendment, renewal or extension of any outstanding Letter of Credit shall
specify in form and detail satisfactory to the Issuing Bank:


 


(i)            the
Letter of Credit to be amended, renewed or extended;


 


(ii)           the
proposed date of amendment, renewal or extension thereof (which shall be a Business
Day);


 


(iii)          the
nature of the proposed amendment, renewal or extension; and


 


(iv)          such
other matters as the Issuing Bank may reasonably require.


 


If requested
by the Issuing Bank, Borrower also shall submit a letter of credit application
on the Issuing Bank’s standard form in connection with any request for a Letter
of Credit.  A Letter of Credit shall be
issued, amended, renewed or extended only if (and upon issuance, amendment,
renewal or extension of each Letter of Credit, Borrower shall be deemed to
represent and warrant that), after giving effect to such issuance, amendment,
renewal or extension (i) the LC Exposure shall not exceed $20.0 million
and (ii) the total Revolving Exposures shall not exceed the total
Revolving Commitments.  Unless the
Issuing Bank shall agree otherwise, no Letter of Credit shall be in an initial
amount less than $100,000, in the case of a Commercial Letter of Credit, or
$500,000, in the case of a Standby Letter of Credit.


 


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(c)           Expiration
Date.


 


(i)            Each
Letter of Credit shall expire at or prior to the close of business on the
earlier of (x) in the case of a Standby Letter of Credit, (1) the date
which is one year after the date of the issuance of such Standby Letter of
Credit (or, in the case of any renewal or extension thereof, one year after
such renewal or extension) and (2) the Letter of Credit Expiration Date
and (y) in the case of a Commercial Letter of Credit, (1) the date that is
180 days after the date of issuance of such Commercial Letter of Credit (or, in
the case of any renewal or extension thereof, 180 days after such renewal or
extension) and (2) the Letter of Credit Expiration Date.


 


(ii)           If
Borrower so requests in any Letter of Credit Request, then the Issuing Bank
may, in its sole and absolute discretion, agree to issue a Letter of Credit
that has automatic renewal provisions (each, an “Auto-Renewal Letter of Credit”);
provided that any such Auto-Renewal
Letter of Credit must permit the Issuing Bank to prevent any such renewal at
least once in each twelve-month period (commencing with the date of issuance of
such Letter of Credit) by giving prior notice to the beneficiary thereof not
later than a day in each such twelve-month period to be agreed upon at the time
such Letter of Credit is issued.  Unless
otherwise directed by the Issuing Bank, Borrower shall not be required to make
a specific request to the Issuing Bank for any such renewal.  Once an Auto-Renewal Letter of Credit has
been issued, the Revolving Lenders shall be deemed to have authorized (but may
not require) the Issuing Bank to permit the renewal of such Letter of Credit at
any time to an expiry date not later than the earlier of (x) one year from the
date of such renewal and (y) the Letter of Credit Expiration Date; provided that the Issuing Bank shall not permit any such
renewal if (1) the Issuing Bank has determined that it would have no obligation
at such time to issue such Letter of Credit in its renewed form under the terms
hereof (by reason of the provisions of Section 2.18 or otherwise), or (2) it
has received notice (which may be by telephone or in writing) on or before the
day that is two Business Days before the date which has been agreed upon
pursuant to the proviso of the first sentence of this paragraph, (A) from
the Administrative Agent that any Revolving Lender directly affected thereby
has elected not to permit such renewal or (B) from the Administrative
Agent, any Lender or Borrower that one or more of the applicable conditions
specified in Section 4.01 is not then satisfied.


 


(d)           Participations.  By the issuance of a Letter of Credit (or an
amendment to a Letter of Credit increasing the amount thereof) and without any
further action on the part of the Issuing Bank or the Lenders, the Issuing Bank
hereby irrevocably grants to each Revolving Lender, and each Revolving Lender
hereby acquires from the Issuing Bank, a participation in such Letter of Credit
equal to such Lender’s Pro Rata Percentage of the aggregate amount available to
be drawn under such Letter of Credit.  In
consideration and in furtherance of the foregoing, each Revolving Lender hereby
absolutely and unconditionally agrees to pay to the Administrative Agent, for
the account of the Issuing Bank, such Lender’s Pro Rata Percentage of each LC
Disbursement made by the Issuing Bank and not reimbursed by Borrower on the
date due as provided in paragraph (e) of this Section, or of any
reimbursement payment required to be refunded to Borrower for any reason.  Each Lender acknowledges and agrees that its
obligation to acquire participations pursuant to this paragraph in respect of
Letters of Credit is absolute and unconditional and shall not be affected by
any circumstance whatsoever, including any amendment, renewal or extension of
any Letter of Credit or the occurrence and continuance of a Default or
reduction or termination of the Commitments, and that each such payment shall be
made without any offset, abatement, withholding or reduction whatsoever.


 


(e)           Reimbursement.  If the Issuing Bank shall make any LC
Disbursement in respect of a Letter of Credit, Borrower shall reimburse such LC
Disbursement by paying to the Issuing Bank an amount equal to such LC
Disbursement not later than 3:00 p.m., New York City time, on the date
that such LC Disbursement is made, if Borrower shall have received notice of
such LC Disbursement prior to


 


45





















 


11:00 a.m., New York City
time, on such date, or, if such notice has not been received by Borrower prior
to such time, on such date, then not later than 2:00 p.m., New York City
time on the Business Day immediately following the day that Borrower receives
such notice; provided that Borrower
may, subject to the conditions to borrowing set forth herein, request in accordance
with Section 2.03 that such payment be financed with an ABR
Revolving Borrowing in an equivalent amount and, to the extent so financed, Borrower’s
obligation to make such payment shall be discharged and replaced by the
resulting ABR Revolving Borrowing.


 


If Borrower
fails to make such payment when due, the Issuing Bank shall notify the
Administrative Agent and the Administrative Agent shall notify each Revolving
Lender of the applicable LC Disbursement, the payment then due from Borrower in
respect thereof and such Lender’s Pro Rata Percentage thereof.  Each Revolving Lender shall pay by wire
transfer of immediately available funds to the Administrative Agent on such
date (or, if such Revolving Lender shall have received such notice later than
12:00 noon on any day, not later than 11:00 a.m. on the immediately
following Business Day), an amount equal to such Revolving Lender’s Pro Rata Percentage
of the unreimbursed LC Disbursement in the same manner as provided in Section 2.02
with respect to Loans made by such Lender, and the Administrative Agent will
promptly pay to the Issuing Bank the amounts so received by it from the
Revolving Lenders.  The Administrative
Agent will promptly pay to the Issuing Bank any amounts received by it from Borrower
pursuant to the above paragraph prior to the time that any Revolving Lender
makes any payment pursuant to the preceding sentence; any such amounts received
by the Administrative Agent thereafter will be promptly remitted by the
Administrative Agent to the Revolving Lenders that shall have made such
payments and to the Issuing Bank, as appropriate.


 


If any
Revolving Lender shall not have made its Pro Rata Percentage of such LC
Disbursement available to the Administrative Agent as provided above, each of
such Revolving Lender and Borrower severally agrees to pay interest on such
amount, for each day from including the date such amount is required to be paid
in accordance with the foregoing to but excluding the date such amount is paid,
to the Administrative Agent for the account of the Issuing Bank at (i) in
the case of Borrower, the rate per annum set forth in Section 2.18(h) and
(ii) in the case of such Lender, at a rate determined by the
Administrative Agent in accordance with banking industry rules or
practices on interbank compensation.


 


(f)            Obligations
Absolute.  The Reimbursement
Obligation of Borrower as provided in Section 2.18(e) shall be
absolute, unconditional and irrevocable, and shall be performed strictly in
accordance with the terms of this Agreement under any and all circumstances
whatsoever and irrespective of (i) any lack of validity or enforceability
of any Letter of Credit or this Agreement, or any term or provision therein; (ii) any
draft or other document presented under a Letter of Credit proving to be
forged, fraudulent, invalid or insufficient in any respect or any statement
therein being untrue or inaccurate in any respect; (iii) payment by the
Issuing Bank under a Letter of Credit against presentation of a draft or other
document that does not substantially comply with the terms of such Letter of
Credit; (iv) any other event or circumstance whatsoever, whether or not
similar to any of the foregoing, that might, but for the provisions of this Section 2.18,
constitute a legal or equitable discharge of, or provide a right of setoff
against, the obligations of Borrower hereunder; (v) the fact that a
Default or Event of Default shall have occurred and be continuing; and (vi) any
adverse change in the business, assets, property, results of operations,
prospects or condition, financial or otherwise, of Borrower and its
Subsidiaries.  None of the Agents, the
Lenders, the Issuing Bank or any of their Affiliates, shall have any liability
or responsibility by reason of or in connection with the issuance or transfer
of any Letter of Credit or any payment or failure to make any payment
thereunder (irrespective of any of the circumstances referred to in the
preceding sentence), or any error, omission, interruption, loss or delay in
transmission or delivery of any draft, notice or other communication under or
relating to any Letter of Credit (including any document required to make a
drawing thereunder), any error in interpretation of technical terms or any
consequence arising from causes


 


46





















 


beyond the control of the
Issuing Bank; provided that the
foregoing shall not be construed to excuse the Issuing Bank from liability to Borrower
to the extent of any direct damages (as opposed to consequential damages,
claims in respect of which are hereby waived by Borrower to the extent
permitted by applicable law) suffered by Borrower that are caused by the Issuing
Bank’s failure to exercise care when determining whether drafts and other
documents presented under a Letter of Credit comply with the terms
thereof.  The parties hereto expressly
agree that, in the absence of gross negligence or willful misconduct on the
part of the Issuing Bank (as finally determined by a court of competent jurisdiction),
the Issuing Bank shall be deemed to have exercised care in each such
determination.  In furtherance of the
foregoing and without limiting the generality thereof, the parties agree that,
with respect to documents presented which appear on their face to be in
substantial compliance with the terms of a Letter of Credit, the Issuing Bank
may, in its sole discretion, either accept and make payment upon such documents
without responsibility for further investigation, regardless of any notice or
information to the contrary, or refuse to accept and make payment upon such
documents if such documents are not in strict compliance with the terms of such
Letter of Credit.


 


(g)           Disbursement
Procedures.  The Issuing Bank shall,
promptly following its receipt thereof, examine all documents purporting to
represent a demand for payment under a Letter of Credit.  The Issuing Bank shall promptly notify the
Administrative Agent and Borrower by telephone (confirmed by telecopy) of such
demand for payment and whether the Issuing Bank has made or will make an LC
Disbursement thereunder; provided
that any failure to give or delay in giving such notice shall not relieve Borrower
of its Reimbursement Obligation to the Issuing Bank and the Revolving Lenders
with respect to any such LC Disbursement (other than with respect to the timing
of such Reimbursement Obligation set forth in Section 2.18(e)).


 


(h)           Interim
Interest.  If the Issuing Bank shall
make any LC Disbursement, then, unless Borrower shall reimburse such LC
Disbursement in full on the date such LC Disbursement is made, the unpaid
amount thereof shall bear interest payable on demand, for each day from and
including the date such LC Disbursement is made to but excluding the date that Borrower
reimburses such LC Disbursement, at the rate per annum set forth in Section 2.06(c).  Interest accrued pursuant to this paragraph
shall be for the account of the Issuing Bank, except that interest accrued on
and after the date of payment by any Revolving Lender pursuant to paragraph (e) of
this Section to reimburse the Issuing Bank shall be for the account of
such Lender to the extent of such payment.


 


(i)            Cash
Collateralization.  If any Event of
Default shall occur and be continuing, on the Business Day that Borrower
receives notice from the Administrative Agent or the Required Lenders (or, if
the maturity of the Loans has been accelerated, Revolving Lenders with LC
Exposure representing greater than 50% of the total LC Exposure) demanding the
deposit of cash collateral pursuant to this paragraph, Borrower shall deposit
in the LC Sub Account, in the name of the Collateral Agent and for the benefit
of the Lenders, an amount in cash equal to the LC Exposure as of such date plus
any accrued and unpaid interest thereon; provided
that the obligation to deposit such cash collateral shall become effective
immediately, and such deposit shall become immediately due and payable, without
demand or other notice of any kind, upon the occurrence of any Event of Default
with respect to Borrower described in clause (g) or (h) of Article VIII.  Each such deposit shall be held by the
Collateral Agent as collateral for the payment and performance of the
obligations of Borrower under this Agreement. 
The Collateral Agent shall have exclusive dominion and control,
including the exclusive right of withdrawal, over such account.  Other than any interest earned on the
investment of such deposits, which investments shall be made at the option and
sole discretion of the Collateral Agent and at the risk and expense of Borrower,
such deposits shall not bear interest. 
Interest or profits, if any, on such investments shall accumulate in
such account.  Moneys in such account
shall be applied by the Collateral Agent to reimburse the Issuing Bank for LC
Disbursements for which it has not been reimbursed and, to the extent not so
applied, shall


 


47





















 


be held for the satisfaction of
the reimbursement obligations of Borrower for the LC Exposure at such time or,
if the maturity of the Loans has been accelerated (but subject to the consent
of Revolving Lenders with LC Exposure representing greater than two thirds of
the total LC Exposure), be applied to satisfy other Obligations of Borrower
under this Agreement.  If Borrower is
required to provide an amount of cash collateral hereunder as a result of the
occurrence of an Event of Default, such amount plus
any accrued interest or realized profits on such amounts (to the extent not
applied as aforesaid) shall be returned to Borrower within three Business Days
after all Events of Default have been cured or waived.  If Borrower is required to provide an amount
of such collateral hereunder pursuant to Section 2.10(b), such
amount plus any accrued interest
or realized profits on account of such amount (to the extent not applied as
aforesaid) shall be returned to Borrower as and to the extent that, after
giving effect to such return, Borrower would remain in compliance with Section 2.10(b) and
no Default or Event of Default shall have occurred and be continuing.


 


(j)            Resignation
or Removal of the Issuing Bank.  The
Issuing Bank may resign as Issuing Bank hereunder at any time upon at least 30
days’ prior notice to the Lenders, the Administrative Agent and Borrower.  The Issuing Bank may be replaced at any time
by written agreement among Borrower, each Agent, the replaced Issuing Bank and
the successor Issuing Bank.  The
Administrative Agent shall notify the Lenders of any such replacement of the
Issuing Bank or any such additional Issuing Bank.  At the time any such resignation or
replacement shall become effective, Borrower shall pay all unpaid fees accrued
for the account of the replaced Issuing Bank pursuant to Section 2.05(c).  From and after the effective date of any such
resignation or replacement or addition, as applicable, (i) the successor
or additional Issuing Bank shall have all the rights and obligations of the
Issuing Bank under this Agreement with respect to Letters of Credit to be
issued thereafter and (ii) references herein to the term “Issuing Bank”
shall be deemed to refer to such successor or such additional or any previous
Issuing Bank, or to such successor or such additional and all previous Issuing
Banks, as the context shall require. 
After the resignation or replacement of an Issuing Bank hereunder, the
replaced Issuing Bank shall remain a party hereto and shall continue to have
all the rights and obligations of an Issuing Bank under this Agreement with
respect to Letters of Credit issued by it prior to such resignation or
replacement, but shall not be required to issue additional Letters of
Credit.  If at any time there is more
than one Issuing Bank hereunder, Borrower may, in its discretion, select which
Issuing Bank is to issue any particular Letter of Credit.


 


(k)           Additional
Issuing Banks.  Borrower may, at any
time and from time to time with the consent of the Administrative Agent (which
consent shall not be unreasonably withheld) and such Lender, designate one or
more additional Lenders to act as an issuing bank under the terms of this
Agreement, with the consent of the Administrative Agent (which consent shall
not be unreasonable withheld), the Issuing Bank and such Revolving Lender.  Any Lender designated as an issuing bank
pursuant to this paragraph (k) shall be deemed (in addition to being a Lender)
to be the Issuing Bank with respect to Letters of Credit issued or to be issued
by such Lender, and all references herein and in the other Loan Documents to
the term “Issuing Bank” shall, with respect to such Letters of Credit, be
deemed to refer to such Lender in its capacity as Issuing Bank, as the context
shall require.


 


The Issuing
Bank shall be under no obligation to issue any Letter of Credit if:


 


(i)            any
order, judgment or decree of any Governmental Authority or arbitrator shall by
its terms purport to enjoin or restrain the Issuing Bank from issuing such
Letter of Credit, or any law applicable to the Issuing Bank or any request or
directive (whether or not having the force of law) from any Governmental
Authority with jurisdiction over the Issuing Bank shall prohibit, or request
that the Issuing Bank refrain from, the issuance of letters of credit generally
or such Letter of Credit in particular or shall impose upon the Issuing Bank
with respect to such Letter of Credit any restriction, reserve or capital
requirement (for which the Issuing Bank is not


 


48





















 


otherwise compensated hereunder) not in effect on the Closing Date, or
shall impose upon the Issuing Bank any unreimbursed loss, cost or expense which
was not applicable on the Closing Date and which the Issuing Bank in good faith
deems material to it; or


 


(ii)           the
issuance of such Letter of Credit would violate one or more policies of the Issuing
Bank.


 


The Issuing
Bank shall be under no obligation to amend any Letter of Credit if (A) the
Issuing Bank would have no obligation at such time to issue such Letter of
Credit in its amended form under the terms hereof, or (B) the beneficiary
of such Letter of Credit does not accept the proposed amendment to such Letter
of Credit.


 


SECTION 2.19.    [Intentionally omitted].


 


SECTION 2.20.    [Intentionally omitted].


 


SECTION 2.21.    [Intentionally omitted].


 


SECTION 2.22.    Increase in Commitments.


 


(a)           At
any time, Borrower may by written notice to the Administrative Agent and
without the consent of the other Lenders hereunder request an increase to the
existing Revolving Commitments (any such increase, an “Incremental Revolving Commitment”) or commitments
to make additional Term B Loans (any such increase, an “Incremental Term B Commitment”).  The Incremental Revolving Commitments and the
Incremental Term B Commitments (collectively, the “Incremental
Commitments”) shall be in minimum amounts of at least $5.0 million
and the aggregate amount of all Incremental Commitments shall not exceed $75.0
million.  Such notice shall specify the
date (an “Increased Amount Date”)
on which Borrower proposes that the Incremental Commitments be made available,
which shall be a date not less than 5 Business Days after the date on which
such notice is delivered to the Administrative Agent, and the amount of each Class of
Incremental Commitment.  The Administrative
Agent shall notify Borrower in writing of the identity of each Lender or other
financial institution reasonably acceptable to the Administrative Agent (each,
an “Incremental Lender”) to whom
the Incremental Commitments have been allocated and the amounts of such allocations;
provided that any Lender approached to
provide all or a portion of the Incremental Commitments may elect or decline,
in its sole discretion, to provide an Incremental Commitment.  Such Incremental Commitments shall become
effective as of such Increased Amount Date; provided that (1) no
Default or Event of Default has occurred and is continuing or would result
after giving effect to the making of such Incremental Commitments and Loans or
the application of the proceeds therefrom, (2) such increase in the Commitments
shall be evidenced by one or more joinder agreements (the “Increase Joinder”)
executed by Borrower, the Administrative Agent and each Lender making such
Incremental Commitment, in form and substance satisfactory to each of
them.  The Increase Joinder may, without
the consent of any other Lenders, effect such amendments to this Agreement and
the other Loan Documents as may be necessary or appropriate, in the opinion of
the Administrative Agent, to effect the provisions of this Section 2.22,
and each shall be recorded in the register, each of which shall be subject to
the requirements set forth in Section 2.15(e).  In addition, unless otherwise specifically
provided herein, all references in Loan Documents to Revolving Loans or Term B
Loans shall be deemed, unless the context otherwise requires, to include
references to Revolving Loans made pursuant to Incremental Revolving Commitments
and Loans made pursuant to Incremental Term B Commitments (“Incremental Term Loans”), respectively, made pursuant to
this Agreement.


 


(b)           The
terms and provisions of Loans made pursuant to the Incremental Commitments
shall be as follows:


 


49





















 


(i)            the
terms and provisions of Incremental Term Loans shall be, except as otherwise
set forth herein or in the Increase Joinder, identical to the Term B Loans (it
being understood that Incremental Term Loans may be part of an existing tranche
of Term Loans);


 


(ii)           the
terms and provisions of Revolving Loans made pursuant to Incremental Revolving
Commitments shall be identical to the Revolving Loans;


 


(iii)          the
weighted average life to maturity of all Incremental Term Loans shall be no
shorter than the weighted average life to maturity of the Revolving Loans and
the existing Term B Loans;


 


(iv)          the
maturity date of Incremental Term Loans shall not be earlier than the Term B Maturity
Date;


 


(v)           the
Applicable Margins for the Incremental Term Loans shall be determined by
Borrower and the applicable Incremental Lenders; provided, however, that the Applicable Margins for the Incremental
Term Loans shall not be greater than the highest Applicable Margins that may,
under any circumstances, be payable with respect to Term B Loans plus 50 basis
points (and the Applicable Margins applicable to the Term B Loans shall be
increased to the extent necessary to achieve the foregoing).


 


(c)           On
any Increased Amount Date on which Incremental Revolving Commitments are
effected, subject to the satisfaction of the foregoing terms and conditions, (i) each
of the existing Revolving Lenders shall assign to each of the Incremental
Lenders having an Incremental Revolving Commitment (the “Incremental Revolving Lenders”), and each
of the Incremental Revolving Lenders shall purchase from each of the existing Revolving
Lenders, at the principal amount thereof, such interests in the outstanding
Revolving Loans and participations in Letters of Credit and Swingline Loans
outstanding on such Increased Amount Date that will result in, after giving
effect to all such assignments and purchases, such Revolving Loans and
participations in Letters of Credit and Swingline Loans being held by existing
Revolving Lenders and Incremental Revolving Lenders ratably in accordance with
their Revolving Commitments after giving effect to the addition of such Incremental
Revolving Commitments to the Revolving Commitments, (ii) each Incremental
Revolving Commitment shall be deemed for all purposes a Revolving Commitment
and each Loan made thereunder shall be deemed, for all purposes, a Revolving
Loan and have the same terms as any existing Revolving Loan and (iii) each
Incremental Revolving Lender shall become a Lender with respect to the
Revolving Commitments and all matters relating thereto.  Borrower shall make any payments required
pursuant to Section 2.13 in connection with any adjustment of Revolving
Loans pursuant to this Section 2.22(b). 
Assignments made to effect this Section 2.22(b) shall be made
in accordance with Section 11.04. 
The Administrative Agent shall notify the Lenders promptly upon receipt
of Borrower’s notice of an Increased Amount Date and, in respect thereof, the Incremental
Revolving Commitments and the Incremental Revolving Lenders.


 


(d)           On
any Increased Amount Date on which Incremental Term B Commitments are effected,
subject to the satisfaction of the foregoing terms and conditions and the
conditions set forth in Section 4.02, (i) each Incremental Lender
having an Incremental Term B Commitment shall make Term B Loans to Borrower
in the amount of its Incremental Term B Commitment, and (ii) each Incremental
Term B Lender shall become a Lender with respect to its Incremental Term B
Commitment and all matters relating thereto.


 


(e)           The
Administrative Agent shall notify the Lenders promptly upon receipt of Borrower’s
notice of an Increased Amount Date and, in respect thereof, the Incremental
Commitments and the Incremental Lenders.


 


50





















 


SECTION 2.23.    Term B Loans and Revolving Loans.


 


(a)           Term B
Loans.


 


(i)            Subject
to the terms and conditions hereof, each Original Lender with an Original
Term B Loan (other than a Reduced Lender) who executes and delivers a
counterpart of this Amendment and Restatement severally agrees to exchange its
Original Term B Loans for a like outstanding principal amount of Term B Loans
on the Third Amendment and Restatement Effective Date, which exchange shall be
deemed to be the making of a Term B Loan by such Lender for such amount.


 


(ii)           Borrower
shall prepay all Original Term B Loans of Original Lenders that do not
execute and deliver a counterpart of this Amendment and Restatement on the
Third Amendment and Restatement Effective Date and the Reduced Lenders with a
portion of the gross proceeds of such Term B Loans and, by its signature below,
each Lender exchanging its Original Term B Loan for a Term B Loan and each
Reduced Lender consents to such prepayment. 
Any such prepayment shall be effected on the Third Amendment and
Restatement Effective Date without regard to any notice requirement, minimum
principal amount or pro rata allocation provision otherwise applicable thereto
under this Agreement.


 


(iii)          Borrower
shall pay all accrued and unpaid interest under the Original Credit Agreement
on the Original Term B Loans to the Original Lenders holding Original Term B
Loans on the Third Amendment and Restatement Effective Date and any breakage
loss or expense under Section 2.13 of this Agreement.  On the Third Amendment and Restatement
Effective Date, the Original Term B Loans shall be deemed paid in full and
discharged.


 


(iv)          The
holders of the Term B Loans shall be entitled to the same guarantees and
security interests pursuant to the Security Agreement and the other Security
Documents from and after the Third Amendment and Restatement Effective Date as
the benefits which the holders of the Original Term B Loans had been entitled
immediately prior to the Third Amendment and Restatement Effective Date.


 


(b)           Revolving
Loans.


 


(i)            Subject
to the terms and conditions hereof, each Original Lender with an Original Revolving
Commitment (other than a Reduced Lender) who executes and delivers a
counterpart of this Amendment and Restatement severally agrees to exchange its
Original Revolving Commitment for a like principal amount of Revolving
Commitments on the Third Amendment and Restatement Effective Date.


 


(ii)           Borrower
shall prepay all outstanding Original Revolving Loans with a portion of the
gross proceeds of such Revolving Loans and, by its signature below, each Lender
exchanging its Original Revolving Commitment for a Revolving Commitment and
each Reduced Lender consents to such prepayment and such termination of its
Original Revolving Commitment.  Any such
prepayment of Original Revolving Loans and termination of Original Revolving
Commitments shall be effected on the Third Amendment and Restatement Effective
Date without regard to any notice requirement, minimum principal amount or pro
rata allocation provision otherwise applicable thereto under this Agreement.


 


(iii)          Borrower
shall pay all accrued and unpaid interest under the Original Credit Agreement
on the Original Revolving Loans to the Original Lenders holding Original
Revolving


 


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Loans on the Third Amendment and Restatement Effective Date and any
breakage loss or expense under Section 2.13 of this Agreement.  On the Third Amendment and Restatement
Effective Date, the Original Revolving Loans shall be deemed paid in full and
discharged and the Original Revolving Commitments shall be deemed terminated.


 


(iv)          The
holders of the Revolving Commitments shall be entitled to the same guarantees
and security interests pursuant to the Security Agreement and the other
Security Documents from and after the Third Amendment and Restatement Effective
Date as the benefits which the holders of the Original Revolving Loans and
Original Revolving Commitments had been entitled immediately prior to the Third
Amendment and Restatement Effective Date.


 


ARTICLE III


 


REPRESENTATIONS
AND WARRANTIES


 


Each Loan
Party represents and warrants to the Administrative Agent, the Collateral
Agent, the Issuing Bank and each of the Lenders that:


 


SECTION 3.01.    Organization; Powers.  Each Company (a) is duly organized and
validly existing under the laws of the jurisdiction of its organization, (b) has
all requisite power and authority to carry on its business as now conducted and
to own and lease its property and (c) is qualified and in good standing
(to the extent such concept is applicable in the applicable jurisdiction) to do
business in every jurisdiction where such qualification is required, except in
such jurisdictions where the failure to so qualify or be in good standing,
individually or in the aggregate, could not reasonably be expected to result in
a Material Adverse Effect.


 


SECTION 3.02.    Authorization; Enforceability.  The Transactions to be entered into by each
Loan Party are within such Loan Party’s powers and have been duly authorized by
all necessary action.  This Agreement has
been duly executed and delivered by each Loan Party and constitutes, and each
other Loan Document to which any Loan Party is to be a party, when executed and
delivered by such Loan Party, will constitute, a legal, valid and binding
obligation of such Loan Party, enforceable in accordance with its terms, subject
to applicable bankruptcy, insolvency, reorganization, moratorium or other laws
affecting creditors’ rights generally and subject to general principles of
equity, regardless of whether considered in a proceeding in equity or at law.


 


SECTION 3.03.    Governmental Approvals; No Conflicts.  Except as set forth on Schedule 3.03,
the Transactions (a) do not require any consent or approval of,
registration or filing with, or any other action by, any Governmental
Authority, except (i) such as have been obtained or made and are in full
force and effect, (ii) filings necessary to perfect Liens created under
the Loan Documents and (iii) consents, approvals, registrations, filings
or actions the failure of which to obtain or perform could not reasonably be
expected to result in a Material Adverse Effect, (b) will not violate the
charter, by laws or other organizational documents of any Company or any order
of any Governmental Authority, (c) will not violate, result in a default
or require any consent or approval under any applicable law or regulation, indenture,
agreement or other instrument binding upon any Company or its assets, or give
rise to a right thereunder to require any payment to be made by any Company,
except for violations, defaults or the creation of such rights that could not
reasonably be expected to result in a Material Adverse Effect, and (d) will
not result in the creation or imposition of any Lien on any property of any
Company, except Liens created under the Loan Documents and Permitted Liens.


 


SECTION 3.04.    Financial Statements.  Borrower has heretofore furnished to the
Lenders (i) the consolidated balance sheets as of December 31, 2002,
2003 and 2004 and related statements of


 


52





















 


income, stockholders’ equity
and cash flows of Borrower as of and for the fiscal years ended December 31,
2002, 2003 and 2004, audited by and accompanied by the opinion of KPMG LLP,
independent public accountants, and (ii) the unaudited consolidated
balance sheets and related statements of income, stockholders’ equity and cash
flows of Borrower as of and for the latest twelve-month and nine-month periods
ended September 30, 2005, in each case, certified by the Chief Financial
Officer of Borrower.  Such financial
statements (and all financial statements delivered pursuant to Section 5.01)
have been prepared in accordance with GAAP consistently applied and present
fairly and accurately the financial condition and results of operations and
cash flows of Borrower as of such dates and for such periods.  Except as set forth in such financial
statements (and all financial statements delivered pursuant to Section 5.01),
there are no liabilities of any Company of any kind, whether accrued,
contingent, absolute, determined, determinable or otherwise, which could
reasonably be expected to result in a Material Adverse Effect, and there is no
existing condition, situation or set of circumstances which could reasonably be
expected to result in such a liability, other than liabilities under the Loan
Documents.


 


SECTION 3.05.    No Claims.  Each Company owns or has rights to use all of
the Collateral and all rights with respect to any of the foregoing used in,
necessary for or material to each Company’s business as currently
conducted.  The use by each Company of
such Collateral and all such rights with respect to the foregoing do not
infringe on the rights of any person other than such infringement which would
not, individually or in the aggregate, result in a Material Adverse Effect.  No claim has been made and remains
outstanding that any Company’s use of any Collateral does or may violate the
rights of any third person that would individually, or in the aggregate, have a
Material Adverse Effect.


 


SECTION 3.06.    Properties.


 


(a)           Each
Company has good title to, or valid leasehold interests in, all its property
material to its business, except for minor irregularities or deficiencies in
title that, individually or in the aggregate, do not interfere with its ability
to conduct its business as currently conducted or to utilize such property for
its intended purpose.  Title to all such
property held by such Company is free and clear of all Liens except for
Permitted Liens.  The property of the
Companies, taken as a whole, (i) is in good operating order, condition and
repair (ordinary wear and tear excepted) (except to the extent that the failure
to be in such condition could not reasonably be expected to result in a
Material Adverse Effect) and (ii) constitutes all the property which is
required for the business and operations of the Companies as presently
conducted.


 


(b)           Schedule 3.06(b) contains
a true and complete list of each interest in Real Property owned by any Company
as of the date hereof and describes the type of interest therein held by such
Company.  Schedule 3.06(b) contains
a true and complete list of each Real Property leased, subleased or otherwise
occupied or utilized by any Company, as lessee, sublessee, franchisee or
licensee, as of the date hereof and describes the type of interest therein held
by such Company and whether such lease, sublease or other instrument requires
the consent of the landlord thereunder or other parties thereto to the Transactions.


 


(c)           (i) No
Company has received any notice of, nor has any knowledge of, the occurrence or
pendency or contemplation of any Casualty Event affecting all or any portion of
the property and (ii) no Mortgage encumbers improved Real Property that is
located in an area that has been identified by the Secretary of Housing and
Urban Development as an area having special flood hazards and with respect to
which flood insurance has been made available under the National Flood
Insurance Act of 1968.


 


SECTION 3.07.    Intellectual Property.


 


(a)           Ownership/No
Claims.  Each Loan Party owns, or is
licensed to use, all patents, patent applications, trademarks, trade names,
service marks, copyrights, technology, trade secrets, proprietary


 


53





















 


information, domain names, know
how and processes necessary for the conduct of its business as currently
conducted (the “Intellectual Property”),
except for those the failure to own or license which, individually or in the
aggregate, could not reasonably be expected to result in a Material Adverse
Effect.  No claim has been asserted and
is pending by any person challenging or questioning the use of any such
Intellectual Property or the validity or effectiveness of any such Intellectual
Property, nor does any Loan Party know of any valid basis for any such
claim.  The use of such Intellectual
Property by each Loan Party does not infringe the rights of any person, except
for such claims and infringements that, individually or in the aggregate, could
not reasonably be expected to result in a Material Adverse Effect.


 


(b)           Registrations.
 Except pursuant to licenses and other
user agreements entered into by each Loan Party in the ordinary course of
business that are listed in Schedules 15(a) and 15(b) annexed
to the Perfection Certificate (as such term is defined in the Security
Agreement), on and as of the date hereof (i) each Loan Party owns and
possesses the right to use, and has done nothing to authorize or enable any
other person to use, any Copyright, Patent or Trademark (as such terms are
defined in the Security Agreement) listed in Schedules 15(a) and 15(b) annexed
to the Perfection Certificate and (ii) all registrations listed in Schedules
15(a) and 15(b) annexed to the Perfection Certificate are
valid and in full force and effect, except for such lack of rights or failures
to register that, individually or in the aggregate, could not reasonably be
expected to result in a Material Adverse Effect.


 


(c)           No
Violations or Proceedings.  To each
Loan Party’s knowledge, on and as of the date hereof, (i) except as set
forth in Schedule 3.07(c) annexed hereto, there is no material
violation by others of any right of such Loan Party with respect to any
Copyright, Patent or Trademark listed in Schedules 15(a) and 15(b) annexed
to the Perfection Certificate, respectively, pledged by it under the name of
such Loan Party, (ii) such Loan Party is not infringing upon any
Copyright, Patent or Trademark of any other person other than such infringement
that, individually or in the aggregate, would not (or would not reasonably be
expected to) result in a Material Adverse Effect on the value or utility of the
Intellectual Property or any portion thereof material to the use and operation
of the Collateral and (iii) no proceedings have been instituted or are
pending against such Loan Party or, to such Loan Party’s knowledge, threatened,
and no claim against such Loan Party has been received by such Loan Party,
alleging any such violation, except as may be set forth in this Section 3.07(c).


 


SECTION 3.08.    Condition and Maintenance of Equipment.  The equipment of each Company is in good
repair, working order and condition, reasonable wear and tear excepted.  Each Company shall cause the equipment to be
maintained and preserved in good repair, working order and condition, reasonable
wear and tear excepted, and shall as quickly as commercially practicable make
or cause to be made all repairs, replacements and other improvements which are
necessary or appropriate in the conduct of each Company’s ordinary course of
business.


 


SECTION 3.09.    Equity Interests and Subsidiaries.


 


(a)           Schedule 3.09(a) sets
forth a list of (i) all the Subsidiaries and their jurisdiction of
organization as of the Third Amendment and Restatement Effective Date and (ii) the
number of shares of each class of each Subsidiaries’ Equity Interests outstanding,
on the Third Amendment and Restatement Effective Date and the number of shares
covered by all outstanding options, warrants, rights of conversion or purchase
and similar rights at the Third Amendment and Restatement Effective Date.  All Equity Interests of each Company are duly
and validly issued and are fully paid and nonassessable and (other than shares
of Borrower) are owned by Borrower, directly or indirectly, through Wholly
Owned Subsidiaries.  Each Loan Party is
the record and beneficial owner of, and has good and marketable title to, the
Equity Interests pledged by it under the Security Agreement, free of any and
all Liens, rights or claims of other persons, except the security interest
created by the Security Agreement, and there are no outstanding


 


54





















 


warrants, options or other
rights to purchase, or shareholder, voting trust or similar agreements
outstanding with respect to, or property that is convertible into, or that
requires the issuance or sale of, any such Equity Interests.


 


(b)           No
consent of any person including any other general or limited partner, any other
member of a limited liability company, any other shareholder or any other trust
beneficiary is necessary or desirable in connection with the creation,
perfection or first priority status of the security interest of the Collateral
Agent in any Equity Interests pledged to the Collateral Agent for the benefit
of the Secured Parties under the Security Agreement or the exercise by the Collateral
Agent of the voting or other rights provided for in the Security Agreement or
the exercise of remedies in respect thereof.


 


(c)           An
accurate organization chart, showing the ownership structure of Borrower and
each Subsidiary on the Third Amendment and Restatement Effective Date, and
after giving effect to the Transaction, is set forth on Schedule 3.09(c).


 


SECTION 3.10.    Litigation; Compliance with Laws.


 


(a)           There
are no actions, suits or proceedings at law or in equity by or before any
Governmental Authority now pending or, to the knowledge of any Company,
threatened against or affecting any Company 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)           Except
for matters covered by Section 3.20, no Company or any of its property
is in violation of, nor will the continued operation of their property as
currently conducted violate, any Requirements of Law (including any zoning or
building ordinance, code or approval or any building permits) or any
restrictions of record or agreements affecting the Real 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.


 


SECTION 3.11.    Agreements.


 


(a)           No
Company is a party to any agreement or instrument or subject to any corporate
or other constitutional restriction that has resulted or could reasonably be expected
to result in a Material Adverse Effect.


 


(b)           No
Company is in default in any manner under any provision of any indenture or
other agreement or instrument evidencing Indebtedness, or any other agreement
or instrument to which it is a party or by which it or any of its property are
or may be bound, where such default could reasonably be expected to result in a
Material Adverse Effect.


 


(c)           Schedule 3.11(c) accurately
and completely lists all material agreements (other than leases of Real
Property set forth on Schedule 3.06(b)) to which any Company is a
party which are in effect on the date hereof in connection with the operation
of the business conducted thereby and Borrower has delivered to the
Administrative Agent complete and correct copies of all such material agreements,
including any amendments, supplements or modifications with respect thereto.


 


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SECTION 3.12.    Federal Reserve Regulations.


 


(a)           No
Company is engaged principally, or as one of its important 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 or any Letter of Credit 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.  The pledge of the Securities
Collateral pursuant to the Security Agreement does not violate such
regulations.


 


SECTION 3.13.    Investment Company Act; Public Utility
Holding Company Act.  No
Company is (a) an “investment company” or a company “controlled” by an “investment
company,” as defined in, or subject to regulation under, the Investment Company
Act of 1940, as amended, or (b) a “holding company,” an “affiliate” of a “holding
company” or a “subsidiary company” of a “holding company,” as defined in, or
subject to regulation under, the Public Utility Holding Company Act of 1935, as
amended.


 


SECTION 3.14.    Use of Proceeds.  Borrower will use the proceeds of the
Revolving Loans for working capital and general corporate purposes (including
to effect Permitted Acquisitions).  The
proceeds of the Term B Loans shall be used to repay the Original Term B Loans.


 


SECTION 3.15.    Taxes.  Each Company has (a) timely filed or
caused to be timely filed all federal Tax Returns and all material, state,
local and foreign Tax Returns or materials required to have been filed by it
and all such Tax Returns are true and correct in all material respects and (b) duly
and timely paid or caused to be duly and timely paid all Taxes (whether or not
shown on any Tax Return) due and payable by it and all assessments received by
it, except Taxes (i) that are being contested in good faith by appropriate
proceedings and for which such Company shall have set aside on its books
adequate reserves in accordance with GAAP or (ii) which could not,
individually or in the aggregate, have a Material Adverse Effect; provided that any such contest of Taxes
with respect to Collateral shall also satisfy the Contested Collateral Lien
Conditions.  Each Company has made
adequate provision in accordance with GAAP for all Taxes not yet due and
payable.  Each Company is unaware of any
proposed or pending tax assessments, deficiencies or audits that could be reasonably
expected to, individually or in the aggregate, result in a Material Adverse
Effect.


 


SECTION 3.16.    No Material Misstatements.  No information, report, financial statement,
exhibit or schedule furnished by or on behalf of any Company to the Administrative
Agent or any Lender in connection with the negotiation of any Loan Document or
included therein or delivered pursuant thereto (including the Confidential
Information Memorandum) 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, taken as a whole, in the light of the
circumstances under which they were, are or will be made, not misleading as of
the date such information is dated or certified; provided
that to the extent any such information, report, financial statement, exhibit
or schedule was based upon or constitutes a forecast or projection, each
Company represents only that it acted in good faith and utilized reasonable
assumptions and due care in the preparation of such information, report,
financial statement, exhibit or schedule.


 


SECTION 3.17.    Labor Matters.  As of the date hereof and the Third Amendment
and Restatement Effective Date, there are no strikes, lockouts or slowdowns
against any Company pending or, to the knowledge of any Company,
threatened.  The hours worked by and payments
made to employees of any Company have not been in violation of the Fair Labor
Standards Act or any other applicable federal,


 


56





















 


state, local or foreign law dealing
with such matters in any manner which could reasonably be expected to result in
a Material Adverse Effect.  All payments
due from any Company, or for which any claim may be made against any Company,
on account of wages and employee health and welfare insurance and other
benefits, have been paid or accrued as a liability on the books of such Company
except where the failure to do so could not reasonably be expected to result in
a Material Adverse Effect.  The consummation
of the Transactions will not give rise to any right of termination or right of
renegotiation on the part of any union under any collective bargaining agreement
to which any Company is bound.


 


SECTION 3.18.    Solvency.  Immediately after the consummation of the
Transactions to occur on the Third Amendment and Restatement Effective 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 each Loan Party (individually and on a consolidated basis with its
Subsidiaries) will exceed its debts and liabilities, subordinated, contingent
or otherwise; (b) the present fair saleable value of the property of each
Loan Party (individually and on a consolidated basis with its Subsidiaries)
will be greater than the amount that will be required to pay the probable
liability of its debts and other liabilities, subordinated, contingent or
otherwise, as such debts and other liabilities become absolute and matured; (c) each
Loan Party (individually and on a consolidated basis with its Subsidiaries)
will be able to pay its debts and liabilities, subordinated, contingent or
otherwise, as such debts and liabilities become absolute and matured; and (d) each
Loan Party (individually and on a consolidated basis with its Subsidiaries)
will not have unreasonably small capital with which to conduct its business in
which it is engaged as such business is now conducted and is proposed to be
conducted following the Third Amendment and Restatement Effective Date.


 


SECTION 3.19.    Employee Benefit Plans.  Each Company and its ERISA Affiliates is in
compliance in all material respects with the applicable provisions of ERISA and
the Code and the regulations and published interpretations thereunder.  No ERISA Event has occurred or is reasonably
expected to occur that, when taken together with all other such ERISA Events,
could reasonably be expected to result in material liability of any Company or
any of its ERISA Affiliates or the imposition of a Lien on any of the assets of
a Company.  The present value of all accumulated
benefit obligations of all underfunded Plans (based on the assumptions used for
purposes of Statement of Financial Accounting Standards No. 87) did not,
as of the date of the most recent financial statements reflecting such amounts,
exceed by more than $250,000 the fair market value of the assets of all such
underfunded Plans.  Using actuarial
assumptions and computation methods consistent with subpart 1 of subtitle E of
Title IV of ERISA, the aggregate liabilities of each Company or its ERISA
Affiliates to all Multiemployer Plans in the event of a complete withdrawal
therefrom, as of the close of the most recent fiscal year of each such
Multiemployer Plan, could not reasonably be expected to result in a Material
Adverse Effect.


 


SECTION 3.20.    Environmental Matters.


 


(a)           Except
as set forth in this Schedule 3.20 and except as, individually or
in the aggregate, could not reasonably be expected to result in a Material Adverse
Effect:


 


(1)           The
Companies and their businesses, operations and Real Property are and in the
last six years have been in compliance with, and the Companies have no
liability under, Environmental Law;


 


(2)           The
Companies have obtained all Environmental Permits required for the conduct of
their businesses and operations, and the ownership, operation and use of their
assets, under Environmental Law, all such Environmental Permits are valid and
in good standing and, under the currently effective business plan of the
Companies, no expenditures or operational


 


57





















 


adjustments will be required in order to renew or modify such
Environmental Permits during the next five years;


 


(3)           There
has been no Release or threatened Release of Hazardous Material on, at, under
or from any real property or facility presently or formerly owned, leased or
operated by the Companies or their predecessors in interest that could result
in liability by the Companies under Environmental Law;


 


(4)           There
is no Environmental Claim pending or, to the knowledge of the Companies,
threatened against the Companies, or relating to the real property currently or
formerly owned, leased or operated by the Companies or relating to the
operations of the Companies, and there are no actions, activities,
circumstances, conditions, events or incidents that could form the basis of
such an Environmental Claim; and


 


(5)           No
person with an indemnity or contribution obligation to the Companies relating
to compliance with or liability under Environmental Law is in default with
respect to such obligation.


 


(b)           Except
as set forth in Schedule 3.20:


 


(1)           No
Company is obligated to perform any action or otherwise incur any expense under
Environmental Law pursuant to any order, decree, judgment or agreement by which
it is bound or has assumed by contract or agreement, and no Company is
conducting or financing any Response pursuant to any Environmental Law with
respect to any Real Property or any other location;


 


(2)           No
Real Property or facility owned, operated or leased by the Companies and, to
the knowledge of the Companies, no real property or facility formerly owned,
operated or leased by the Companies or any of their predecessors in interest is
(i) listed or proposed for listing on the National Priorities List
promulgated pursuant to CERCLA or (ii) listed on the Comprehensive
Environmental Response, Compensation and Liability Information System
promulgated pursuant to CERCLA or (iii) included on any similar list
maintained by any Governmental Authority including, without limitation, any
such list relating to petroleum;


 


(3)           No
Lien has been recorded or, to the knowledge of any Company, threatened under
any Environmental Law with respect to any Real Property or assets of the
Companies;


 


(4)           The
execution, delivery and performance of this Agreement and the consummation of
the transactions contemplated hereby will not require any notification,
registration, filing, reporting, disclosure, investigation, remediation or
cleanup pursuant to any Governmental Real Property Disclosure Requirements or
any other Environmental Law; and


 


(5)           The
Companies have made available to Lenders all material records and files in the
possession, custody or control of, or otherwise reasonably available to, the
Companies concerning compliance with or liability under Environmental Law
including, without limitation, those concerning the existence of Hazardous
Material at real property or facilities currently or formerly owned, operated,
leased or used by the Companies.


 


SECTION 3.21.    Insurance.  Schedule 3.21 sets forth a true,
complete and correct description of all insurance maintained by each Company as
of the Third Amendment and Restatement Effective Date.  As of each such date, such insurance is in
full force and effect and all premiums have been duly


 


58





















 


paid.  Each Company has insurance in such amounts
and covering such risks and liabilities as are in accordance with normal industry
practice.


 


SECTION 3.22.    Security Documents.


 


(a)           The
Security Agreement is effective to create in favor of the Collateral Agent for
the benefit of the Secured Parties, a legal, valid and enforceable security
interest in and Lien on the Security Agreement Collateral and, when (i) financing
statements and other filings in appropriate form are filed in the offices
specified on Schedule 7 to the Perfection Certificate and (ii) upon
the taking of possession or control by the Collateral Agent of the Security
Agreement Collateral with respect to which a security interest may be perfected
only by possession or control (which possession or control shall be given to
the Collateral Agent to the extent possession or control by the Collateral
Agent is required by each Security Agreement), the Lien created by the Security
Agreement shall constitute a fully perfected Lien on, and security interest in,
all right, title and interest of the grantors thereunder in the Security
Agreement Collateral (other than (A) the Intellectual Property Collateral
(as defined in the Security Agreement) and (B) such Security Agreement
Collateral in which a security interest cannot be perfected under the UCC as in
effect at the relevant time in the relevant jurisdiction), in each case subject
to no Liens other than Permitted Liens.


 


(b)           When
the Security Agreement or a short form thereof is filed in the United States
Patent and Trademark Office and the United States Copyright Office, the Lien
created by such Security Agreement shall constitute a fully perfected Lien on,
and security interest in, all right, title and interest of the grantors
thereunder in the Intellectual Property Collateral (as defined in such Security
Agreement), in each case subject to no Liens other than Permitted Liens.


 


(c)           Each
Mortgage executed and delivered prior to the date hereof is effective to
create, in favor of the Collateral Agent, for its benefit and the benefit of
the Secured Parties, a legal, valid and enforceable first priority Lien on and
security interest in all of the Loan Parties’ right, title and interest in and
to the Mortgaged Properties thereunder and the proceeds thereof, and the
Mortgages shall constitute fully perfected Liens on, and security interests in,
all right, title and interest of the Loan Parties in the Mortgaged Properties
and the proceeds thereof, in each case prior and superior in right to any other
person, other than Liens reasonably acceptable to Administrative Agent.


 


(d)           Each
Security Document delivered pursuant to Sections 5.11 and 5.12
will, upon execution and delivery thereof, be effective to create in favor of
the Collateral Agent, for the benefit of the Secured Parties, a legal, valid
and enforceable security interest in and Lien on all of the Loan Parties’
right, title and interest in and to the Collateral thereunder, and when all
appropriate filings or recordings are made in the appropriate offices as may be
required under applicable law, such Security Document will constitute a fully
perfected Lien on, and security interest in, all right, title and interest of
the Loan Parties in such Collateral, in each case subject to no Liens other
than the applicable Permitted Liens.


 


SECTION 3.23.    No Material Adverse Effect.  Since December 31, 2004, there has been
no event, change or occurrence that, individually or in the aggregate, has had
or could reasonably be expected to result in a Material Adverse Effect.


 


SECTION 3.24.    Anti-Terrorism
Law.


 


(a)           No
Loan Party and, to the knowledge of the Loan Parties, none of its Affiliates is
in violation of any Requirement of Law relating to terrorism or money
laundering (“Anti-Terrorism Laws”), including
Executive Order No. 13224 on Terrorist Financing, effective September 24,
2001 (the


 


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“Executive
Order”), and the Uniting and Strengthening America by Providing
Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001, Public
Law 107-56.


 


(b)           No
Loan Party and to the actual knowledge of the Loan Parties, no Affiliate or
broker or other agent of any Loan Party acting or benefiting in any capacity in
connection with the Loans is any of the following:


 


(i)            a
person that is listed in the annex to, or is otherwise subject to the
provisions of, the Executive Order;


 


(ii)           a
person owned or controlled by, or acting for or on behalf of, any person that
is listed in the annex to, or is otherwise subject to the provisions of, the
Executive Order;


 


(iii)          a
person with which any Lender is prohibited from dealing or otherwise engaging
in any transaction by any Anti-Terrorism Law;


 


(iv)          a
person that commits, threatens or conspires to commit or supports “terrorism”
as defined in the Executive Order; or


 


(v)           a
person that is named as a “specially designated national and blocked person” on
the most current list published by the U.S. Treasury Department Office of
Foreign Assets Control (“OFAC”) at its
official website or any replacement website or other replacement official publication
of such list.


 


(c)           No
Loan Party and, to the actual knowledge of the Loan Parties, no broker or other
agent of any Loan Party acting in any capacity in connection with the Loans (i) conducts
any business or engages in making or receiving any contribution of funds, goods
or services to or for the benefit of any person described in paragraph (b) above,
(ii) deals in, or otherwise engages in any transaction relating to, any
property or interests in property blocked pursuant to the Executive Order, or (iii) engages
in or conspires to engage in any transaction that evades or avoids, or has the
purpose of evading or avoiding, or attempts to violate, any of the prohibitions
set forth in any Anti-Terrorism Law.


 


ARTICLE IV


 


CONDITIONS TO
CREDIT EXTENSIONS


 


SECTION 4.01.    Conditions to Initial Credit Extension.  The following conditions precedent to the
obligation of each Original Lender to fund the initial Credit Extension
requested to be made by it were satisfied on the Closing Date.


 


(a)           Loan
Documents.  All legal matters
incident to this Agreement, the Borrowings and extensions of credit hereunder
and the other Loan Documents shall be satisfactory to the Original Lenders, to
the Issuing Bank and to the Administrative Agent and there shall have been
delivered to the Administrative Agent an executed counterpart of each of the
Loan Documents, including this Agreement and the Security Agreement, each
Mortgage, the Perfection Certificate and each other applicable Loan Document.


 


(b)           Corporate
Documents.  The Administrative Agent
shall have received:


 


(i)            a
certificate of the Secretary or Assistant Secretary or general partner of each
Loan Party dated the Closing Date and certifying (A) that attached thereto
is a true


 


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and complete copy of the certificate or
articles of incorporation or other constitutive documents, including all
amendments thereto certified as of a recent date by the Secretary of State of
the state of its organization, (B) that attached thereto is a true and
complete copy of the by laws 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 (C) below, (C) that attached thereto is a true
and complete copy of resolutions duly adopted by the board of directors of such
Loan Party authorizing the execution, delivery and performance of the Loan
Documents to which such person is a party and, in the case of Borrower, the
borrowings hereunder, and that such resolutions have not been modified,
rescinded or amended and are in full force and effect, 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 (together with a certificate of another officer as to the incumbency and
specimen signature of the Secretary or Assistant Secretary executing the
certificate in this clause (i));


 


(ii)           a
long form certificate as to the good standing of each Loan Party as of a recent
date, from such Secretary of State; and


 


(iii)          such
other documents as the Original Lenders, the Issuing Bank or the Administrative
Agent may reasonably request.


 


(c)           Officers’
Certificate.  The Administrative
Agent shall have received a certificate, dated the Closing Date and signed by
the Chief Executive Officer and the Chief Financial Officer of Borrower,
confirming compliance with the conditions precedent set forth in paragraphs
(b), (c), (d) and (e) of Section 4.02.


 


(d)           The
Original Lenders shall be satisfied with the capitalization, the terms and
conditions of any equity arrangements and the corporate or other organizational
structure of the Companies.  The Original
Lenders shall be satisfied that Borrower and its subsidiaries have adequate working
capital and capital expenditure funds and availability.


 


(e)           Financial
Statements; Pro Forma Balance Sheet; Projections.  The Original Lenders shall have received and
shall be satisfied with the form and substance of the financial statements
described in Section 3.04 and with the forecasts of the financial
performance of Borrower, the Acquired Business and their respective
Subsidiaries.


 


(f)            Indebtedness.  After giving effect to the Transactions and
the other transactions contemplated hereby, no Company shall have outstanding
any Indebtedness, preferred stock or minority interests other than (i) the
Loans and extensions of credit hereunder, (ii) up to $8.0 million of
Purchase Money Obligations and the other Indebtedness listed on Schedule 6.01(b),
(iii) Indebtedness owed to Borrower or any Guarantor and (iv) preferred
stock to be converted, exchanged or extended in term as set forth in Section 5.15.


 


(g)           Opinions
of Counsel.  The Administrative Agent
shall have received, on behalf of itself, the other Agents, the Arranger, the
Original Lenders and the Issuing Bank, a favorable written opinion of (i) Andrews
Kurth LLP, special counsel for the Loan Parties, substantially to the effect
set forth in Exhibit J-1, (ii) each local counsel listed on Schedule 4.01(g),
substantially to the effect set forth in Exhibit J-2, and any legal
opinions delivered under the Acquisition Documents, in each case (A) dated
the Closing Date, (B) addressed to the Agents, the Issuing Bank and the
Original Lenders and (C) covering such other matters relating to the Loan
Documents and the Transactions as the Administrative Agent shall reasonably
request, and (iii) a copy


 


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of each legal opinion delivered under the
other Transaction Documents, and Borrower shall use its best efforts to deliver
reliance letters from the party delivering such opinion authorizing the Agents,
Original Lenders and the Issuing Bank to rely thereon as if such opinion were
addressed to them.


 


(h)           Solvency
Certificate, Other Reports and Transaction Structure.


 


(i)            The
Original Lenders shall have received all other reports and opinions of
appraisers, consultants or other advisors retained by it to review the
business, operation or condition of Borrower and its Subsidiaries giving effect
to the Transactions, and shall be satisfied with such reports and opinions.


 


(ii)           The
Administrative Agent shall have received a solvency certificate in the form of Exhibit M,
dated the Closing Date and signed by the Chief Financial Officer of Borrower
and an equivalent officer for each Borrower.


 


(iii)          The
Original Lenders shall have reviewed, and be satisfied with, the ownership,
corporate, legal, tax, management and capital structure of Borrower and its
Subsidiaries (after giving effect to the Transactions) and any securities issued,
and any indemnities, employment and other arrangements entered into, in
connection with the Transactions.


 


(i)            Requirements
of Law.  The Original Lenders shall
be satisfied that the Transactions shall be in full compliance with all
material Requirements of Law, including without limitation Regulations T, U and
X of the Board.  The Original Lenders
shall have received satisfactory evidence of compliance with all applicable
Requirements of Law, including all applicable environmental laws and regulations.


 


(j)            Consents.  The Original Lenders shall be satisfied that
all requisite Governmental Authorities and third parties shall have approved or
consented to the Transactions, and there shall be no governmental or judicial
action, actual or threatened, that has or would have, singly or in the
aggregate, a reasonable likelihood of restraining, preventing or imposing
burdensome conditions on the Transactions or the other transactions
contemplated hereby.


 


(k)           Litigation.  There shall be no litigation, public or
private, or administrative proceedings, governmental investigation or other
legal or regulatory developments, actual or threatened, that, singly or in the
aggregate, could reasonably be expected to result in a Material Adverse Effect,
or could materially and adversely affect the ability of Borrower and the
Subsidiaries to fully and timely perform their respective obligations under the
Transaction Documents, or the ability of the parties to consummate the
financings contemplated hereby or the other Transactions.


 


(l)            Sources
and Uses.  The sources and uses of
the Loans shall be as set forth in Section 3.14.


 


(m)          Fees.  The Arranger and 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, reimbursement or payment of
all out of pocket expenses (including the legal fees and expenses of Cahill
Gordon & Reindel LLP, special counsel to the Agents, and the fees and
expenses of any local counsel, appraisers, consultants and other advisors)
required to be reimbursed or paid by Borrower hereunder or under any other Loan
Document.


 


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(n)           Personal
Property Requirements.  The
Collateral Agent shall have received:


 


(i)            all
certificates, agreements or instruments representing or evidencing the Pledged
Securities and the Pledged Intercompany Notes (each as defined in the Security
Agreement) accompanied by instruments of transfer and stock powers endorsed in
blank shall have been delivered to the Collateral Agent;


 


(ii)           all
other certificates, agreements, including control agreements, or instruments
necessary to perfect the Collateral Agent’s security interest in all Chattel
Paper, all Instruments, all Deposit Accounts and all Investment Property of
each Loan Party (as each such term is defined in the Security Agreement and to
the extent required by Section 3.3 of the Security Agreement);


 


(iii)          UCC
financing statement s in appropriate form for filing under the UCC, filings
with the United States Patent, Trademark and Copyright offices and such other
documents under applicable Requirements of Law in each jurisdiction as may be
necessary or appropriate or, in the opinion of the Collateral Agent, desirable
to perfect the Liens created, or purported to be created, by the Security
Documents and, with respect to all UCC financing statement s required to be
filed pursuant to the Loan Documents, evidence satisfactory to the
Administrative Agent that Borrower has retained, at its sole cost and expense,
a service provider acceptable to the Administrative Agent for the tracking of
all such financing statements and notification to the Administrative Agent, of,
among other things, the upcoming lapse or expiration thereof;


 


(iv)          certified
copies of UCC, tax and judgment lien searches, bankruptcy and pending lawsuit
searches or equivalent reports or searches, listing all effective financing
statements, lien notices or comparable documents that name any Loan Party as
debtor and that are filed in those state and county jurisdictions in which any
property of any Loan Party is located and the state and county jurisdictions in
which any Loan Party is organized or maintains its principal place of business,
none of which encumber the Collateral covered or intended to be covered by the Security
Documents (other than those relating to Liens acceptable to the Collateral
Agent);


 


(v)           with
respect to each Real Property set forth on Schedule 4.01(n), such
Loan Party shall use its commercially reasonable efforts to obtain a Landlord
Lien Waiver and Access Agreement; and


 


(vi)          evidence
acceptable to the Collateral Agent of payment by the Loan Parties of all
applicable recording taxes, fees, charges, costs and expenses required for the
recording of the Security Documents.


 


(o)           Real
Property Requirements.  The
Collateral Agent shall have received:


 


(i)            a
Mortgage encumbering each Mortgaged Property that, together with any
improvements thereon, individually has a fair market value of at least $2.0
million, in favor of the Collateral Agent, for the benefit of the Secured
Parties, duly executed and acknowledged by each Loan Party that is the owner or
holder of any interest in such Mortgaged Property, and otherwise in proper form
for recording in the recording office of each political subdivision where such
Mortgaged Property is situated, together with such certificates, affidavits,
questionnaires or returns as shall be required in connection with the recording
or filing thereof to create a lien under applicable law, and such UCC 1


 


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financing statements, all of which shall be
in form and substance reasonably satisfactory to the Collateral Agent, and any
other instruments necessary to grant a mortgage lien under the laws of any
applicable jurisdiction, all of which Mortgages and instruments shall be duly
recorded or filed in such manner and in such places as are required by law to
establish, perfect, preserve and protect the Liens in favor of the Collateral
Agent required to be granted pursuant to the Mortgages and all taxes, fees and
other charges payable in connection therewith shall be paid in full.  Such Mortgages shall constitute valid and
enforceable perfected Liens subject only to Liens reasonably acceptable to the
Administrative Agent;


 


(ii)           with
respect to each Mortgaged Property, such consents, approvals, amendments,
supplements, estoppels, tenant subordination agreements, access agreements or
other instruments as necessary or required to consummate the Transactions or as
shall reasonably be deemed necessary by the Collateral Agent in order for the
owner or holder of the fee or leasehold interest constituting such Mortgaged
Property to grant the Lien contemplated by the Mortgage with respect to such
Mortgaged Property;


 


(iii)          with
respect to each Mortgage, a policy of title insurance (on ALTA 1992 form) (or
commitment to issue a title policy) insuring (or committing to insure) the Lien
of such Mortgage as a valid first mortgage Lien on the Mortgaged Property and
fixtures described therein in the amount set forth on Schedule 4.01(o)(iii) hereto
with respect to such Mortgaged Property 115% of the fair market value of such
Mortgaged Property, which policies (each, a “Title
Policy”) shall (A) be issued by the Title Company, (B) to
the extent necessary, include such reinsurance arrangements (with provisions
for direct access, if necessary) as shall be reasonably acceptable to the
Collateral Agent, (C) contain a “tie in” or “cluster” endorsement (if
available under applicable law) (i.e., policies which insure against losses
regardless of location or allocated value of the insured property up to a
stated maximum coverage amount), (D) have been supplemented by such
endorsements (or where such endorsements are not available, opinions of special
counsel, architects or other professionals reasonably acceptable to the
Collateral Agent to the extent that such opinions can be obtained at a cost
which is reasonable with respect to the value of the Mortgaged Property subject
to such Mortgage) as shall be reasonably requested by the Collateral Agent
(including, without limitation, endorsements on matters relating to usury,
first loss, last dollar, zoning, contiguity, revolving credit, doing business,
non imputation, public road access, survey, variable rate, environmental lien
and so called comprehensive coverage over covenants and restrictions), and (E) contain
no exceptions to title other than exceptions acceptable to the Collateral
Agent;


 


(iv)          with
respect to each Mortgaged Property, such affidavits, certificates, information
(including financial data) and instruments of indemnification (including,
without limitation, a so called “gap” indemnification) as shall be required to
induce the Title Company to issue the Title Policy/ies and endorsements
contemplated in subparagraph (iii) above;


 


(v)           evidence
reasonably acceptable to the Collateral Agent of payment by Borrower of all
Title Policy premiums, search and examination charges, escrow charges, and
related charges, mortgage recording taxes, fees, charges, costs and expenses
required for the recording of the Mortgages and issuance of the Title Policies
referred to subparagraph (iii) above;


 


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(vi)          with
respect to each Real Property or Mortgaged Property, copies of all Leases in
which Borrower or any Subsidiary holds the lessor’s interest or other
agreements relating to possessory interests, if any.  To the extent any of the foregoing affect any
Mortgaged Property, such agreement shall be subordinate to the Lien of the
Mortgage to be recorded against such Mortgaged Property, either expressly by
its terms or pursuant to a subordination, non disturbance and attornment
agreement, and shall otherwise be acceptable to the Collateral Agent;


 


(vii)         with
respect to each Mortgaged Property, each Borrower and each Subsidiary shall
have made all notification, registrations and filings, to the extent required
by, and in accordance with, all Governmental Real Property Disclosure
Requirements applicable to such Mortgaged Property;


 


(viii)        Surveys
with respect to each Mortgaged Property; and


 


(ix)           with
respect to each Mortgaged Property, local counsel opinions in form and substance
reasonably satisfactory to the Collateral Agent;


 


(x)            with
respect to each Mortgaged Property, policies or certificates of insurance, all
as required by the Mortgage related thereto and Section 5.04
hereof, which policies or insurance shall comply with the insurance
requirements contained in Section 5.04 hereof; and


 


(xi)           a
Real Property Officer’s Certificate in form and substance reasonably
satisfactory to the Collateral Agent;.


 


(p)           Insurance.  The Administrative Agent shall have received
a copy of, or a certificate as to coverage under, the insurance policies
required by Section 5.04 and the applicable provisions of the
Security Documents, each of which shall be endorsed or otherwise amended to
include a “standard” or “New York” lender’s loss payable endorsement and to
name the Collateral Agent as additional insured, in form and substance
satisfactory to the Administrative Agent.


 


(q)           EBITDA.  The Original Lenders shall have received a
written certificate of the Chief Executive Officer and the Chief Financial
Officer Borrower that the Consolidated EBITDA for the last four quarter period
ending more than 30 days prior to the Closing Date (last twelve months ended July 31,
2003) calculated on a pro forma basis consistent with the requirements set
forth in Section 5.01(a) was not less than $37.0 million.


 


SECTION 4.02.    Conditions to All Credit Extensions.  The obligation of each Lender and each
Issuing Bank to make any Credit Extension shall be subject to, and to the
satisfaction of, each of the conditions precedent set forth below.


 


(a)           Notice.  The Administrative Agent shall have received
a Borrowing Request as required by Section 2.03 (or such notice
shall have been deemed given in accordance with Section 2.03) if
Loans are being requested or, in the case of the issuance, amendment, extension
or renewal of a Letter of Credit, the Issuing Bank and the Administrative Agent
shall have received a notice requesting the issuance, amendment, extension or
renewal of such Letter of Credit as required by Section 2.18(b) or,
in the case of the Borrowing of a Swingline Loan, the Swingline Lender and the
Administrative Agent shall have received a notice requesting such Swingline
Loan as required by Section 2.17(b).


 


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(b)           No
Default.  Borrower and each other
Loan Party shall be in compliance in all material respects with all the terms
and provisions set forth herein and in each other Loan Document on its part to
be observed or performed, and, at the time of and immediately after such Credit
Extension, no Default shall have occurred and be continuing on such date or
after giving effect to the Credit Extension requested to be made on such date.


 


(c)           Representations
and Warranties.  Each of the
representations and warranties made by any Loan Party set forth in Article III
hereof or in any other Loan Document shall be true and correct in all material
respects (except that any representation and warranty that is qualified as to “materiality”
or “Material Adverse Effect” shall be true and correct in all respects) on and
as of the date of such Credit Extension 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.


 


(d)           No
Material Adverse Effect.  There has
been no event, condition and/or contingency that has had or is reasonably
likely to have a Material Adverse Effect.


 


(e)           No
Legal Bar.  No order, judgment or
decree of any Governmental Authority shall purport to restrain any Lender from
making any Loans to be made by it.  No
injunction or other restraining order shall have been issued, shall be pending
or noticed with respect to any action, suit or proceeding seeking to enjoin or
otherwise prevent the consummation of, or to recover any damages or obtain
relief as a result of, the transactions contemplated by this Agreement or the
making of Loans hereunder.


 


Each of the
delivery of a Borrowing Request or notice requesting the issuance, amendment,
extension or renewal of a Letter of Credit and the acceptance by Borrower of
the proceeds of such Credit Extension shall constitute a representation and warranty
by Borrower and each other Loan Party that on the date of such Credit Extension
(both immediately before and after giving effect to such Credit Extension and
the application of the proceeds thereof) the conditions contained in this Section 4.02
have been satisfied.  Borrower shall
provide such information (including calculations in reasonable detail of the
covenants in Section 6.08) as the Administrative Agent may
reasonably request to confirm that the conditions in this Section 4.02
have been satisfied.


 


SECTION 4.03.    Intentionally omitted.


 


SECTION 4.04.    Conditions to Effectiveness of the Amendment
and Restatement.  This
Third Amended and Restated Credit Agreement shall become effective on and as of
the first date (the “Third Amendment and
Restatement Effective Date”) on which all of the following
conditions precedent shall have been satisfied:


 


(a)           Expenses.  All of the reasonable fees and expenses of
counsel for the Agents in connection with the amendment and restatement shall
have been paid in full.


 


(b)           No
Default or Event of Default.  No
Default or Event of Default shall have occurred and be continuing on the Third
Amendment and Restatement Effective Date.


 


(c)           Representations
and Warranties.  Each of the
representations and warranties made in or pursuant to Article III or which
are contained in any other Loan Document shall be true and correct in all
material respects on and as of the Third Amendment and Restatement Effective
Date as if made on and as of such date (unless stated to relate to a specific
earlier date, in which case such representations and warranties shall be true
and correct in all material respects as of such earlier date).


 


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(d)           Authorization.  The execution, delivery and performance of
this Agreement shall have been duly authorized by all necessary action on the
part of Borrower and the Subsidiary Guarantors, and the Administrative Agent
shall have received satisfactory evidence thereof.


 


(e)           Opinions
and Certificates.  The Administrative
Agent shall have received opinions and certificates dated the Third Amendment
and Restatement Effective Date, in form and substance satisfactory to the
Administrative Agent and including a representation by the Chief Financial
Officer of Borrower that, as of the Third Amendment and Restatement Effective
Date, no tax or judgment liens
have been filed against any Loan Party or any of their respective properties
since the Closing Date.


 


(f)            Initial
Public Offering.  Borrower shall have
consummated the initial public offering of its common stock pursuant to the
registration statement on Form S-1 (Registration No. 333-127517), as
amended, filed with the Securities and Exchange Commission under the Securities
Act of 1933, as amended.


 


ARTICLE V


 


AFFIRMATIVE
COVENANTS


 


Each Loan
Party covenants and agrees with each Lender that so long as this Agreement
shall remain in effect (except for provisions which by their terms survive
termination, such as indemnification provisions) 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 and all Letters of Credit have been canceled or have expired or
been fully cash collateralized and all amounts drawn thereunder have been
reimbursed in full, unless the Required Lenders shall otherwise consent in
writing, each Loan Party will, and will cause each of its subsidiaries to:


 


SECTION 5.01.    Financial Statements, Reports, etc. 
Borrower will furnish to the Administrative Agent and each Lender:


 


(a)           Annual
Reports.  Within 120 days after the
end of each fiscal year, (i) the consolidated balance sheet of Borrower
and its Subsidiaries as of the end of such fiscal year and related consolidated
statements of income, cash flows and stockholders’ equity for such fiscal year,
and notes thereto, all prepared in accordance with Regulation S-X under the
Securities Act and accompanied by an opinion of KPMG LLP or other independent
public accountants of recognized national standing satisfactory to the
Administrative Agent (which opinion shall not be qualified as to scope or
contain any going concern or other qualification), stating that such financial
statements fairly present, in all material respects, the consolidated financial
condition, results of operations, cash flows and changes in stockholders’
equity of the Consolidated Companies as of the end of and for such fiscal year
in accordance with GAAP consistently applied, (ii) a management report in
a form reasonably satisfactory to the Administrative Agent setting forth, on a
consolidated basis, the financial condition, results of operations and cash
flows of the Consolidated Companies as of the end of and for such fiscal year,
as compared to the Consolidated Companies’ budgeted financial conditions,
results of operations and cash flows, and (iii) a management’s discussion
and analysis of the financial condition and results of operations for such
fiscal year, as compared to the previous fiscal year;


 


(b)           Quarterly
Reports.  Within 45 days after the
end of each of the first three fiscal quarters of each fiscal year, (i) the
consolidated balance sheet of Borrower and its Subsidiaries as of the end of
such fiscal quarter and related consolidated statements of income and cash
flows for


 


67





















 


such fiscal quarter and for the then elapsed
portion of the fiscal year, in comparative form with the consolidated
statements of income and cash flows for the comparable periods in the previous
fiscal year, all prepared in accordance with Regulation S-X under the
Securities Act and accompanied by a certificate of a Financial Officer stating
that such financial statements fairly present, in all material respects, the
consolidated financial condition, results of operations and cash flows of the
Consolidated Companies as of the date and for the periods specified in
accordance with GAAP consistently applied, and on a basis consistent with
audited financial statements referred to in clause (a) if this Section,
subject to normal year end audit adjustments, and (ii) a management’s
discussion and analysis of the financial condition and results of operations
for such fiscal quarter and the then elapsed portion of the fiscal year, as
compared to the comparable periods in the previous fiscal year;


 


(c)           [Intentionally omitted];


 


(d)           Financial
Officer’s Certificate.  (i) Concurrently
with any delivery of financial statements under paragraph (a) or (b) above,
a Compliance Certificate of a Financial Officer certifying that no Default has
occurred or, if such a Default has occurred, specifying the nature and extent
thereof and any corrective action taken or proposed to be taken with respect
thereto; (ii) concurrently with any delivery of financial statements under
subparagraph (a) or (b) above, a certificate of a Financial Officer
setting forth computations in reasonable detail satisfactory to the
Administrative Agent demonstrating compliance with the covenants contained in Section 6.08;
and (iii) in the case of paragraph (a) above, a report of the
accounting firm opining on or certifying such financial statements stating that
in the course of its regular audit of the financial statements of Borrower and
its Subsidiaries, which audit was conducted in accordance with GAAP, such
accounting firm obtained no knowledge that any Default has occurred or, if in
the opinion of such accounting firm such a Default has occurred, specifying the
nature and extent thereof;


 


(e)           Financial
Officer’s Certificate Regarding Collateral. 
Concurrently with any delivery of financial statements under paragraph
(a), above, a Perfection Certificate or Perfection Certificate Supplement;


 


(f)            Public
Reports.  Promptly after the same
become publicly available, copies of all periodic and other reports, proxy
statements and other materials filed by any Company 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 holders of its Indebtedness pursuant to the terms of the
documentation governing such Indebtedness (or any trustee, agent or other
representative therefor), as the case may be;


 


(g)           Management
Letters.  Promptly after the receipt
thereof by any Company, a copy of any “management letter” received by any such
person from its certified public accountants and the management’s responses
thereto;


 


(h)           Budgets.  No later than the second day of each fiscal
year of Borrower and its Subsidiaries, a budget in form reasonably satisfactory
to the Administrative Agent (including budgeted statements of income, sources
and uses of cash and balance sheets of the Consolidated Companies) for each
fiscal month of such fiscal year prepared in detail and on a consolidated
basis, with appropriate presentation and discussion of the principal
assumptions upon which such budgets are based, accompanied by the statement of
a Financial Officer of Borrower to the effect that the budget of the
Consolidated Companies is a reasonable estimate for the period covered thereby;


 


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(i)            Annual
Meetings with Lenders.  Within 120
days after the close of each fiscal year of Borrower shall, at the request of
the Administrative Agent or Required Lenders, hold a meeting (at a mutually
agreeable location and time) with all Lenders who choose to attend such meeting
at which meeting shall be reviewed the financial results of the previous fiscal
year and the financial condition of the Companies and the budgets presented for
the current fiscal year of the Companies; and


 


(j)            Other
Information.  Promptly, from time to
time, such other information regarding the operations, business affairs and
financial condition of any Company, or compliance with the terms of any Loan
Document, as the Administrative Agent or any Lender may reasonably request.


 


SECTION 5.02.    Litigation and Other Notices.  Furnish to the Administrative Agent and each
Lender prompt written notice of the following:


 


(a)           any
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 threat or notice of intention of any person
to file or commence, any action, suit or proceeding, whether at law or in
equity by or before any Governmental Authority, (i) against any Company or
any Affiliate thereof that could reasonably be expected to result in a Material
Adverse Effect or (ii) with respect to any Loan Document;


 


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


 


(d)           the
occurrence of a Casualty Event and will ensure that the Net Cash Proceeds of
any such event (whether in the form of insurance proceeds, condemnation awards
or otherwise) are collected and applied in accordance with the applicable
provisions of this Agreement and the Security Documents; and


 


(e)           (i) the
incurrence of any material Lien (other than Permitted Liens) on, or claim asserted
against any of the Collateral or (ii) the occurrence of any other event
which could materially affect the value of the Collateral.


 


SECTION 5.03.    Existence; 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 or, in the case of any Subsidiary, where the
failure to perform such obligations, individually or in the aggregate, could
not reasonably be expected to result in a Material Adverse Effect.


 


(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 with all
applicable Requirements of Law (including any and all zoning, building, Environmental
Law, ordinance, code or approval or any building permits or any restrictions of
record or agreements affecting the Real Property) and decrees and orders of any
Governmental Authority, whether now in effect or hereafter enacted, except
where the failure to comply, individually or in the aggregate, could not
reasonably be expected to result in a Material Adverse Effect; pay and perform
its obligations under all Leases and Loan Documents; and at


 


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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 in the ordinary course at all
times; provided that nothing in
this Section 5.03(b) shall prevent (i) sales of assets,
consolidations or mergers by or involving any Company in accordance with Section 6.05;
(ii) the withdrawal by any Company of its qualification as a foreign
corporation in any jurisdiction where such withdrawal, individually or in the
aggregate, could not reasonably be expected to result in a Material Adverse
Effect; or (iii) the abandonment by any Company of any rights, franchises,
licenses, trademarks, trade names, copyrights or patents that such person reasonably
determines are not useful to its business.


 


SECTION 5.04.    Insurance.


 


(a)           Keep
its insurable property adequately insured at all times by financially sound and
reputable insurers; maintain such other insurance, to 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, including 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 property owned,
occupied or controlled by it; and maintain such other insurance as may be
required by law; and, with respect to the Collateral, otherwise maintain all
insurance coverage required under each applicable Security Document, such
policies to be in such form and amounts and having such coverage as may be
reasonably satisfactory to the Administrative Agent and the Collateral Agent.


 


(b)           All
such insurance shall (i) provide that no cancellation, material reduction
in amount or material change in coverage thereof shall be effective until at
least 30 days after receipt by the Collateral Agent of written notice thereof, (ii) name
the Collateral Agent as mortgagee (in the case of property insurance) or additional
insured (in the case of liability insurance) or loss payee (in the case of
casualty insurance), as applicable, (iii) if reasonably requested by the
Collateral Agent, include a breach of warranty clause and (iv) be
reasonably satisfactory in all other respects to the Collateral Agent.


 


(c)           Notify
the Administrative Agent and the Collateral Agent immediately whenever any
separate insurance concurrent in form or contributing in the event of loss with
that required to be maintained under this Section 5.04 is taken out
by any Company; and promptly deliver to the Administrative Agent and the
Collateral Agent a duplicate original copy of such policy or policies.


 


(d)           Obtain
flood insurance in such total amount as the Administrative Agent or the
Required Lenders may from time to time require, if at any time the area in
which any improvements located on any real property covered by a Mortgage is
designated a “flood hazard area” in any Flood Insurance Rate Map published by
the Federal Emergency Management Agency (or any successor agency) and otherwise
comply with the National Flood Insurance Program as set forth in the Flood
Disaster Protection Act of 1975, as amended from time to time.


 


(e)           Deliver
to the Administrative Agent and the Collateral Agent and the Lenders a report
of a reputable insurance broker with respect to such insurance and such
supplemental reports with respect thereto as the Administrative Agent or the
Collateral Agent may from time to time reasonably request.


 


SECTION 5.05.    Obligations and Taxes.


 


(a)           Pay
its Indebtedness and other obligations promptly and in accordance with their
terms and pay and discharge promptly when due all 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


 


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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 other than a Permitted Lien upon such
properties or any part thereof; provided
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
applicable Company shall have set aside on its books adequate reserves with
respect thereto in accordance with GAAP and such contest operates to suspend
collection of the contested obligation, Tax, assessment or charge and
enforcement of a Lien other than a Permitted Lien and, in the case of
Collateral, the applicable Company shall have otherwise complied with the
Contested Collateral Lien Conditions.


 


(b)           Timely
and correctly file all material Tax Returns required to be filed by it.


 


SECTION 5.06.    Employee Benefits.  Comply in all material respects with the
applicable provisions of ERISA and the Code and (b) furnish to the
Administrative Agent (x) as soon as possible after, and in any event within 10
days after any Responsible Officer of the Companies or their ERISA Affiliates
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 or the imposition of a Lien,
a statement of a Financial Officer of Borrower setting forth details as to such
ERISA Event and the action, if any, that the Companies propose to take with
respect thereto, and (y) upon request by the Administrative Agent, copies
of:  (i) each Schedule B
(Actuarial Information) to the annual report (Form 5500 Series) filed by
any Company or any ERISA Affiliate with the Internal Revenue Service with
respect to each Plan; (ii) the most recent actuarial valuation report for
each Plan; (iii) all notices received by any Company or any ERISA Affiliate
from a Multiemployer Plan sponsor or any governmental agency concerning an
ERISA Event; and (iv) such other documents or governmental reports or
filings relating to any Plan (or employee benefit plan sponsored or contributed
to by any Company) as the Administrative Agent shall reasonably request.


 


SECTION 5.07.    Maintaining Records; Access to Properties and
Inspections.  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 Company will permit any representatives
designated by the Administrative Agent or any Lender to visit and inspect the
financial records and the property of such Company 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 any Company with the officers thereof and, after reasonable notice
to such Company, the independent accountants therefor.


 


SECTION 5.08.    Use of Proceeds.  Use the proceeds of the Loans and request the
issuance of Letters of Credit only for the purposes set forth in Section 3.14.


 


SECTION 5.09.    Compliance with Environmental Laws;
Environmental Reports.


 


(a)           Comply,
and cause all lessees and other persons occupying Real Property owned, operated
or leased by any Company to comply, in all material respects with all
Environmental Laws and Environmental Permits applicable to its operations and
Real Property; obtain and renew all material Environmental Permits applicable
to its operations and Real Property; and conduct any Response in accordance
with Environmental Laws; provided
that no Company shall be required to undertake any Response 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.


 


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(b)           If
a Default caused by reason of a breach of Section 3.20 or Section 5.09(a) shall
have occurred and be continuing for more than 20 days without the Companies
commencing activities reasonably likely to cure such Default, at the written
request of the Required Lenders through the Administrative Agent, provide to
the Lenders within 45 days after such request, at the expense of Borrower, an
environmental assessment report regarding the matters which are the subject of
such default, including where appropriate, any soil and/or groundwater
sampling, prepared by an environmental consulting firm and in the form and
substance reasonably acceptable to the Administrative Agent and indicating the
presence or absence of Hazardous Materials and the estimated cost of any
compliance or Response to address them.


 


SECTION 5.10.    Interest Rate Protection.  Borrower shall maintain or cause to be
maintained through May 28, 2006, Interest Rate Agreements acceptable to
the Administrative Agent that result in at least $65,000,000 of the aggregate
principal amount of Borrower’s Consolidated Indebtedness being effectively
subject to a fixed or maximum interest rate acceptable to the Administrative
Agent.


 


SECTION 5.11.    Additional Collateral; Additional Guarantors.


 


(a)           Subject
to this Section 5.11, with respect to any property acquired on or
after the date hereof by Borrower or any other Loan Party that is intended to
be subject to the Lien created by any of the Security Documents but is not so
subject (but, in any event, excluding any property described in paragraph (b) of
this subsection) promptly (and in any event within 30 days after the acquisition
thereof:  (i) execute and deliver to
the Administrative Agent and the Collateral Agent such amendments or supplements
to the relevant Security Documents or such other documents as the
Administrative Agent or the Collateral Agent shall deem necessary or advisable
to grant to the Collateral Agent, for its benefit and for the benefit of the
other Secured Parties, a Lien on such property subject to no Liens other than
Permitted Liens, and (ii) take all actions necessary to cause such Lien to
be duly perfected to the extent required by such Security Document in
accordance with all applicable Requirements of Law, including, without
limitation, the filing of financing statements in such jurisdictions as may be
reasonably requested by the Administrative Agent.  Borrower shall otherwise take such actions and
execute and/or deliver to the Collateral Agent such documents as the
Administrative Agent or the Collateral Agent shall require to confirm the
validity, perfection and priority of the Lien of the Security Documents against
such after-acquired properties or assets.


 


(b)           With
respect to any person that is or becomes a Wholly Owned Subsidiary (other than
any Non-Guarantor Subsidiary or any Foreign Subsidiary that is not a direct
Subsidiary of a Loan Party) promptly (and in any event within 30 days after
such person becomes a Subsidiary) (i) deliver to the Collateral Agent the
certificates, if any, representing the Equity Interests of such Subsidiary (provided that with respect to any Foreign
Subsidiary of Borrower, in no event shall more than 66% of the Equity Interests
of any Foreign Subsidiary be subject to any Lien or pledged under any Security
Document), together with undated stock powers or other appropriate instruments
of transfer executed and delivered in blank by a duly authorized officer of
such Subsidiary’s parent, as the case may be, and all intercompany notes owing
from such Subsidiary to any Loan Party together with instruments of transfer
executed and delivered in blank by a duly authorized officer of such Subsidiary,
and (ii) cause such new Subsidiary (other than any Non-Guarantor
Subsidiary or any Foreign Subsidiary) (A) to execute a Joinder Agreement
or such comparable documentation and a joinder agreement to the Security
Agreement, and (B) to take all actions necessary or advisable in the
opinion of the Administrative Agent or the Collateral Agent to cause the Lien
created by the Security Agreement to be duly perfected to the extent required
by such agreement in accordance with all applicable Requirements of Law,
including, without limitation, the filing of financing statements in such
jurisdictions as may be reasonably requested by the Administrative Agent or the
Collateral Agent.


 


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(c)           If
at any time any two or more Wholly Owned Subsidiaries in the aggregate (other
than any Foreign Subsidiary of Borrower that is not a “first-tier” Foreign
Subsidiary) not otherwise subject to Section 5.11(b) have
assets having either a book value or fair market value in excess of
$10,000,000, then Borrower shall, and shall cause one or more of such
Subsidiaries to, comply with Section 5.11(b) within the time
frames set forth in such subsection so that no two or more such
Subsidiaries hold assets having either a book value or fair market value in
excess of $10,000,000.


 


SECTION 5.12.    Security Interests; Further Assurances.  Promptly, upon the reasonable request of the
Administrative Agent, the Collateral Agent or any Lender, at Borrower’s
expense, execute, acknowledge and deliver, or cause the execution,
acknowledgment and delivery of, and thereafter register, file or record, or
cause to be registered, filed or recorded, in an appropriate governmental
office, any document or instrument supplemental to or confirmatory of the
Security Documents or otherwise deemed by the Administrative Agent or the
Collateral Agent reasonably necessary or desirable for the continued validity,
perfection and priority of the Liens on the Collateral covered thereby superior
to and prior to the rights of all third persons other than the holders of Existing
Liens and subject to no other Liens except as permitted by the applicable
Security Document, or obtain any consents, including, without limitation,
landlord or similar lien waivers and consents, as may be necessary or
appropriate in connection therewith. 
Deliver or cause to be delivered to the Administrative Agent and the
Collateral Agent from time to time such other documentation, consents,
authorizations, approvals and orders in form and substance reasonably
satisfactory to the Administrative Agent and the Collateral Agent as the
Administrative Agent and the Collateral Agent shall reasonably deem necessary
to perfect or maintain the Liens on the Collateral pursuant to the Security
Documents.  Upon the exercise by the
Administrative Agent, the Collateral Agent or the Lenders of any power, right,
privilege or remedy pursuant to any Loan Document which requires any consent,
approval, registration, qualification or authorization of any Governmental
Authority execute and deliver all applications, certifications, instruments and
other documents and papers that the Administrative Agent, the Collateral Agent
or the Lenders may be so required to obtain. 
If the Administrative Agent, the Collateral Agent or the Required
Lenders determine that they are required by law or regulation to have
appraisals prepared in respect of the Real Property of any Loan Party
constituting Collateral, Borrower shall provide to the Administrative Agent
appraisals that satisfy the applicable requirements of the Real Estate Appraisal
Reform Amendments of FIRREA and are otherwise in form and substance
satisfactory to the Administrative Agent and the Collateral Agent.


 


SECTION 5.13.    Information Regarding Collateral.


 


(a)           Furnish
to the Administrative Agent and the Collateral Agent prompt written notice of
any change (i) in any Loan Party’s corporate name or in any trade name
used to identify it in the conduct of its business or in the ownership of its
properties, (ii) in the location of any Loan Party’s chief executive
office, its principal place of business, any office in which it maintains books
or records relating to Collateral owned by it or any office or facility at
which Collateral owned by it is located (including the establishment of any
such new office or facility), (iii) in any Loan Party’s identity or
corporate structure, (iv) in any Loan Party’s Federal Taxpayer
Identification Number or (v) in any Loan Party’s jurisdiction of
organization.  Borrower agrees not to
effect or permit any change referred to in the preceding sentence unless all
filings have been made under the UCC or otherwise that are 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.  Borrower also agrees promptly to notify the
Administrative Agent and the Collateral Agent if any material portion of the
Collateral is subject to a Casualty Event.


 


(b)           Each
year, at the time of delivery of annual financial statements with respect to
the preceding fiscal year pursuant to clause (a) of Section 5.01,
deliver to the Administrative Agent and the Collateral Agent a certificate of a
Financial Officer and the chief legal officer of each Borrower and a


 


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Perfection Certificate
Supplement 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 5.13(b) and
(ii) certifying that all UCC financing statements (including fixture
filings, as applicable) or other appropriate filings, recordings or
registrations, including all refilings, rerecordings and reregistrations,
containing a description of the Collateral have been filed of record in each
governmental, municipal or other appropriate office in each jurisdiction
identified pursuant to clause (i) above to the extent necessary to
protect and perfect the security interests and Liens under the Security
Documents 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).


 


ARTICLE VI


 


NEGATIVE
COVENANTS


 


Each Loan
Party covenants and agrees with each Lender that, so long as this Agreement
shall remain in effect (except for provisions which by their terms survive
termination, such as indemnification provisions) 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 and all Letters of Credit have been canceled or have expired or been fully
cash collateralized and all amounts drawn thereunder have been reimbursed in
full, unless the Required Lenders shall otherwise consent in writing, no Loan
Party will, nor will they cause or permit any Subsidiaries to:


 


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


 


(a)           Indebtedness
incurred pursuant to this Agreement and the other Loan Documents;


 


(b)           (i) Indebtedness
actually outstanding on the date hereof and listed on Schedule 6.01(b) or
(ii) refinancings or renewals thereof; provided
that (A) any such refinancing Indebtedness is in an aggregate principal
amount not greater than the aggregate principal amount of the Indebtedness
being renewed or refinanced, plus
the amount of any premiums required to be paid thereon and fees and expenses
associated therewith, (B) such refinancing Indebtedness has a later or
equal final maturity and longer or equal weighted average life than the
Indebtedness being renewed or refinanced and (C) the covenants, events of
default subordination and other provisions thereof (including any guarantees
thereof) shall be, in the aggregate, no less favorable to the Lenders than
those contained in the Indebtedness being renewed or refinanced;


 


(c)           Indebtedness
of any Company under Interest Rate Agreements entered into in order to fix the
effective rate of interest on the Loans in compliance with Section 5.10
and such other non speculative Interest Rate Agreements which may be entered
into from time to time by any Company and which such Company in good faith
believes will provide protection against fluctuations in interest rates with
respect to floating rate Indebtedness then outstanding, and permitted to remain
outstanding, pursuant to the other provisions of this Section 6.01;


 


(d)           Indebtedness
under Hedging Agreements (other than Interest Rate Agreements) entered into
from time to time by any Company in accordance with Section 6.04(c);


 


(e)           intercompany
Indebtedness of the Companies outstanding to the extent permitted by Sections
6.04(e) and (i);


 


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(f)            Indebtedness
in respect of Purchase Money Obligations and Capital Lease Obligations and
refinancings or renewals thereof, in an aggregate amount not to exceed
$50.0 million at any time outstanding;


 


(g)           Permitted
Subordinated Indebtedness; provided
that the proceeds thereof are applied in accordance with Sections 2.10(d)
and (h).


 


(h)           Indebtedness
in respect of workers’ compensation claims, self insurance obligations,
performance bonds, surety appeal or similar bonds and completion guarantees
provided by a Company in the ordinary course of its business;


 


(i)            Contingent
Obligations of any Loan Party in respect of Indebtedness otherwise permitted
under Section 6.01; and


 


(j)            other
unsecured Indebtedness of the Companies not to exceed $25.0 million in aggregate
principal amount at any time outstanding.


 


SECTION 6.02.    Liens.  Create, incur, assume or permit to exist,
directly or indirectly, any Lien on any property now owned or hereafter
acquired by it or on any income or revenues or rights in respect of any
thereof, except (the “Permitted Liens”):


 


(a)           inchoate
Liens for taxes, assessments or governmental charges or levies not yet due and
payable or delinquent and Liens for taxes, assessments or governmental charges
or levies, which (i) are being contested in good faith by appropriate
proceedings for which adequate reserves have been established in accordance
with GAAP, which proceedings (or orders entered in connection with such
proceedings) have the effect of preventing the forfeiture or sale of the
property or assets subject to any such Lien, or (ii) in the case of any such
charge or claim which has or may become a Lien against any of the Collateral,
such Lien and the contest thereof shall satisfy the Contested Collateral Lien
Conditions.


 


(b)           Liens
in respect of property of any Company imposed by law, which were incurred in
the ordinary course of business and do not secure Indebtedness for borrowed
money, such as carriers’, warehousemen’s, materialmen’s, landlords’, workmen’s,
suppliers’, repairmen’s and mechanics’ Liens and other similar Liens arising in
the ordinary course of business, and (i) which do not in the aggregate
materially detract from the value of the property of the Companies, taken as a
whole, and do not materially impair the use thereof in the operation of the
business of the Companies, taken as a whole, (ii) which are being contested in
good faith by appropriate proceedings for which adequate reserves have been
established in accordance with GAAP, which proceedings (or orders entered in connection
with such proceedings) have the effect of preventing the forfeiture or sale of
the property or assets subject to any such Lien, and (iii) in the case of any
such Lien which has or may become a Lien against any of the Collateral, such
Lien and the contest thereof shall satisfy the Contested Collateral Lien
Conditions.


 


(c)           Liens
in existence on the date hereof and set forth on Schedule 6.02(c); provided that (i) the aggregate
principal amount of the Indebtedness, if any, secured by such Liens does not
increase; and (ii) such Liens do not encumber any property other than the
property subject thereto on the date hereof;


 


(d)           easements,
rights of way, restrictions (including zoning restrictions), covenants, encroachments,
protrusions and other similar charges or encumbrances, and minor title deficiencies
on or with respect to any Real Property, in each case whether now or hereafter
in existence,


 


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not (i) securing Indebtedness, (ii)
individually or in the aggregate materially impairing the value or
marketability of such Real Property and (iii) individually or in the aggregate
materially interfering with the conduct of the business of the Companies at
such Real Property;


 


(e)           Liens
arising out of judgments or awards not resulting in a Default or an Event of Default;


 


(f)            Liens
(other than any Lien imposed by ERISA) (i) imposed by law or deposits made in
connection therewith in the ordinary course of business in connection with
workers’ compensation, unemployment insurance and other types of social
security, (ii) incurred in the ordinary course of business to secure the
performance of tenders, statutory obligations (other than excise taxes),
surety, stay, customs and appeal bonds, statutory bonds, bids, leases,
government contracts, trade contracts, performance and return of money bonds
and other similar obligations (exclusive of obligations for the payment of
borrowed money) or (iii) arising by virtue of deposits made in the ordinary
course of business to secure liability for premiums to insurance carriers; provided that (w) with respect to clauses
(i), (ii) and (iii) hereof, such Liens are for amounts not yet due and payable
or delinquent or, to the extent such amounts are so due and payable, such
amounts are being contested in good faith by appropriate proceedings for which
adequate reserves have been established in accordance with GAAP, which
proceedings for orders entered in connection with such proceedings have the
effect of preventing the forfeiture or sale of the property or assets subject
to any such Lien, (x) to the extent such Liens are not imposed by law, such
Liens shall in no event encumber any property other than cash and Cash
Equivalents, (y) in the case of any such Lien against any of the Collateral,
such Lien and the contest thereof shall satisfy the Contested Collateral Lien
Conditions and (z) the aggregate amount of deposits at any time pursuant to
clause (ii) and clause (iii) shall not exceed $1,000,000 in the aggregate;


 


(g)           Leases
with respect to the assets or properties of any Company, in each case entered
into in the ordinary course of such Company’s business so long as such Leases
are subordinate in all respects to the Liens granted and evidenced by the
Security Documents and do not, individually or in the aggregate, (i) interfere
in any material respect with the ordinary conduct of the business of any
Company or (ii) materially impair the use (for its intended purposes) or the
value of the property subject thereto;


 


(h)           Liens
arising out of conditional sale, title retention, consignment or similar
arrangements for the sale of goods entered into by any Company in the ordinary
course of business in accordance with the past practices of such Company;


 


(i)            Liens
arising pursuant to Purchase Money Obligations or Capital Lease Obligations
incurred pursuant to Section 6.01(f); provided
that (i) the Indebtedness secured by any such Lien (including refinancings
thereof) does not exceed 100% of the cost of the property being acquired or
leased at the time of the incurrence of such Indebtedness and (ii) any such
Liens attach only to the property being financed pursuant to such Purchase
Money Obligations or Capital Lease Obligations and do not encumber any other
property of any Company;


 


(j)            bankers’
Liens, rights of setoff and other similar Liens existing solely with respect to
cash and Cash Equivalents on deposit in one or more accounts maintained by any
Company, in each case granted in the ordinary course of business in favor of
the bank or banks with which such accounts are maintained, securing amounts
owing to such bank with respect to cash management and operating account
arrangements, including those involving pooled accounts and netting
arrangements; provided that in no
case shall any such Liens secure (either directly or indirectly) the repayment
of any Indebtedness;


 


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(k)           Liens
on property of a person existing at the time such person is acquired or merged
with or into or consolidated with any Company (and not created in anticipation
or contemplation thereof); provided
that such Liens do not extend to property not subject to such Liens at the time
of acquisition (other than improvements thereon) and are no more favorable to
the lienholders than the existing Lien;


 


(l)            Liens
granted pursuant to the Security Documents;


 


(m)          licenses
of Intellectual Property granted by any Company in the ordinary course of
business and not interfering in any material respect with the ordinary conduct
of the business of such Company;


 


(n)           other
Liens incurred in the ordinary course of business of any Company with respect
to obligations (other than Indebtedness) that do not in the aggregate exceed
$5.0 million at any time outstanding; and


 


(o)           the
filing of financing statements solely as a precautionary measure in connection
with operating leases or consignment of goods;


 


provided, however, that no Liens shall be
permitted to exist, directly or indirectly, on any Securities Collateral.


 


SECTION 6.03.    Sale and Leaseback Transactions.  Enter into any arrangement, directly or
indirectly, with any person whereby it shall sell or transfer any property,
real or personal, used or useful in its business, whether now owned or
hereafter acquired, and thereafter rent or lease such property or other
property which it intends to use for substantially the same purpose or purposes
as the property being sold or transferred unless (i) the sale of such property
is permitted by Section 6.05 and (ii) any Liens arising in connection
with its use of such property are permitted by Section 6.02.


 


SECTION 6.04.    Investment, Loan and Advances.  Directly or indirectly, lend money or credit
or make advances to any person, or purchase or acquire any stock, obligations
or securities of, or any other interest in, or make any capital contribution
to, any other person, or purchase or own a futures contract or otherwise become
liable for the purchase or sale of currency or other commodities at a future
date in the nature of a futures contract (all of the foregoing, collectively, “Investments”), except that the following
shall be permitted:


 


(a)           Investments
outstanding on the Closing Date and identified on Schedule 6.04(b);


 


(b)           the
Companies may (i) acquire and hold accounts receivables owing to any of them if
created or acquired in the ordinary course of business and payable or
dischargeable in accordance with customary terms, (ii) acquire and hold cash
and Cash Equivalents, (iii) endorse negotiable instruments for collection in
the ordinary course of business or (iv) make lease, utility and other similar
deposits in the ordinary course of business;


 


(c)           Borrower
may enter into Interest Rate Agreements to the extent permitted by Section 6.01(c)
and may enter into and perform its obligations under Hedging Agreements entered
into in the ordinary course of business and so long as any such Hedging
Agreement is not speculative in nature and is (i) related to income derived
from foreign operations of any Company or otherwise related to purchases
permitted hereunder from foreign suppliers or (ii) entered into to protect such
Companies against fluctuations in the prices of raw materials used in their businesses;


 


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(d)           any
Company may make intercompany loans to any Loan Party and any Loan Party may
make intercompany loans and advances to any other Loan Party; provided that such loan shall be evidenced
by a promissory note and shall be pledged (and delivered) by such Loan Party
that is the lender of such intercompany loan as Collateral pursuant to the Security
Agreement, provided  further that (i) no Loan Party may make
loans to any Foreign Subsidiary or Non Guarantor Subsidiary pursuant to this
paragraph (e) and (ii) any loans made by any Foreign Subsidiary or Non
Guarantor Subsidiary to any Loan Party pursuant to this paragraph (e) shall be
subordinated to the obligations of the Loan Parties pursuant to an intercompany
note in substantially the form of Exhibit K;


 


(e)           Borrower
and the Subsidiaries may make loans and advances (including payroll, travel and
entertainment related advances) in the ordinary course of business to their
respective employees (other than any loans or advances to any director or
executive officer (or equivalent thereof) that would be in violation of Section
402 of the Sarbanes Oxley Act) 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 $50,000 individually
and $250,000 in the aggregate outstanding at one time;


 


(f)            Borrower
and the Subsidiaries may sell or transfer amounts to the extent permitted by Section
6.05;


 


(g)           Borrower
may establish (i) Wholly Owned Subsidiaries to the extent permitted by Section
6.12 and (ii) non Wholly Owned Subsidiaries and/or joint ventures to the
extent that Investments in such non Wholly Owned Subsidiaries and/or joint
ventures shall not exceed $10.0 million at any time outstanding, after taking
into account amounts returned in cash (including upon disposition);


 


(h)           Investments
(other than as described in Section 6.04(e)) (i) by Borrower in any
Subsidiary Guarantor, (ii) by any Company in Borrower or any Subsidiary
Guarantor and (iii) by a Subsidiary Guarantor in another Subsidiary
Guarantor;


 


(i)            Investments
in securities of trade creditors or customers in the ordinary course of
business and consistent with such Company’s past practices that are received in
settlement of bona fide disputes or pursuant to any plan of reorganization or
liquidation or similar arrangement upon the bankruptcy or insolvency of such
trade creditors or customers;


 


(j)            Investments
made by Borrower or any Subsidiary as a result of consideration received in
connection with an Asset Sale made in compliance with Section 6.05;


 


(k)           Borrower
may make loans to senior management of Borrower and the Subsidiary Guarantors
for purposes of purchasing the capital stock of Borrower in an aggregate
principal amount not to exceed $2.5 million at any one time outstanding; and


 


(l)            scheduled
payments of Earn Out Obligations of $5.0 million individually and $10.0 million
in any fiscal year of Borrower.


 


SECTION 6.05.    Mergers, Consolidations, Sales of Assets and
Acquisitions.  Wind
up, liquidate or dissolve its affairs or enter into any transaction of merger
or consolidation, or convey, sell, lease or otherwise dispose of (or agree to
do any of the foregoing at any future time) all or any part of its property or
assets, or purchase or otherwise acquire (in one or a series of related
transactions) any part of the property or assets of any person (or agree to do
any of the foregoing at any future time), except that:


 


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(a)           (i)
purchases or other acquisitions of inventory, materials, equipment and intangible
assets in the ordinary course of business shall be permitted, (ii) subject to Section
2.10(c), Asset Sales of used, worn out, obsolete or surplus property by any
Company in the ordinary course of business and the abandonment or other Asset
Sale of Intellectual Property that is, in the reasonable judgment of Borrower,
no longer economically practicable to maintain or useful in the conduct of the
business of the Companies taken as a whole shall be permitted and (iii) subject
to Section 2.10(c), the sale, lease or other disposal of any assets
shall be permitted; provided that
the aggregate consideration received in respect of all Asset Sales pursuant to
this clause (a)(iii) shall not exceed $5,000,000 individually or $15,000,000 in
any four consecutive fiscal quarters of Borrower;


 


(b)           Investments
in connection with any such transaction may be made to the extent permitted by Section
6.04;


 


(c)           Borrower
and the Subsidiaries may sell Cash Equivalents in the ordinary course of business;


 


(d)           Borrower
and the Subsidiaries may lease (as lessee or lessor) real or personal property
and may guaranty such lease, in each case, in the ordinary course of business
and in accordance with the applicable Security Documents;


 


(e)           Borrower
and the Subsidiaries may consummate Permitted Acquisitions;


 


(f)            any
Loan Party may transfer property or lease to or acquire or lease property from
any Loan Party and any Loan Party may be merged into another Loan Party (as
long as such Loan Party is the surviving corporation of such merger and remains
a direct or indirect Wholly Owned Subsidiary of Borrower) or any other Wholly
Owned Subsidiary Guarantor; provided
that the Lien on and security interest in such property granted or to be
granted in favor of the Collateral Agent under the Security Documents shall be
maintained or created in accordance with the provisions of Section 5.11
or Section 5.12, as applicable;


 


(g)           any
Subsidiary may dissolve, liquidate or wind up its affairs at any time; provided that such dissolution,
liquidation or winding up, as applicable, could not reasonably be expected to
have a Material Adverse Effect; and


 


(h)           Asset
Sales by any Company to any other Company shall be permitted; provided that such Asset Sale involving a Subsidiary that it
is not a Loan Party be made in compliance with Section 6.05(a).


 


To the extent
the Required Lenders (or all Lenders, as applicable) waive the provisions of
this Section 6.05 with respect to the sale of any Collateral, or any
Collateral is sold as permitted by this Section 6.05, such Collateral
(unless sold to a Company) shall be sold free and clear of the Liens created by
the Security Documents, and the Agents shall take all actions deemed
appropriate in order to effect the foregoing.


 


SECTION 6.06.    Dividends.  Authorize, declare or pay, directly or
indirectly, any Dividends with respect to any Company, except that:


 


(a)           any
Subsidiary of Borrower (i) may pay cash Dividends to Borrower or any Wholly
Owned Subsidiary of Borrower and (ii) if such Subsidiary is not a Wholly Owned
Subsidiary of Borrower, may pay cash Dividends to its shareholders generally so
long as Borrower or its Subsidiary which owns the equity interest or interests
in the Subsidiary paying such Dividends


 


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receives at least its proportionate share
thereof (based upon its relative holdings of equity interests in the Subsidiary
paying such Dividends and taking into account the relative preferences, if any,
of the various classes of equity interests in such Subsidiary); and


 


(b)           Borrower
may pay cash Dividends from time to time after the Third Amendment and
Restatement Effective Date in an aggregate amount not to exceed $10,000,000 for
any fiscal year, so long as no (i) Event of Default exists or (ii) (on a pro
forma basis after giving effect to payment of such Dividends) Default would
result therefrom at the time of declaration thereof.


 


SECTION 6.07.    Transactions with Affiliates.  Enter into, directly or indirectly, any
transaction or series of related transactions, whether or not in the ordinary
course of business, with any Affiliate of any Company (other than between or
among Borrower and the Subsidiary Guarantors), other than in the ordinary
course of business and on terms and conditions substantially as favorable to
such Company as would reasonably be obtained by such Company at that time in a
comparable arm’s length transaction with a person other than an Affiliate,
except that:


 


(a)           Dividends
may be paid to the extent provided in Section 6.06;


 


(b)           loans
may be made and other transactions may be entered into between and among any
Company and its Affiliates to the extent permitted by Sections 6.01 and 6.04;
and


 


(c)           customary
fees may be paid to non officer directors of Borrower and customary indemnities
may be provided to all directors of Borrower.


 


SECTION 6.08.    Financial
Covenants.


 


(a)           Maximum Leverage Ratio.  Permit the Leverage Ratio, as of the last day
of any Test Period ending during any period set forth in the table below, to
exceed the ratio set forth opposite such period in the table below:


 


	
   

  	
   

  	
  Leverage Ratio

  	
   

  
	
  October 1, 2005 - March 31, 2007

  	
   

  	
  3.50 to 1.00

  	
   

  
	
  April 1, 2007 and thereafter

  	
   

  	
  3.25 to 1.00

  	
   

  



 


(b)           Minimum Interest Coverage Ratio.  Permit the Consolidated Interest Coverage
Ratio, as of the last day of any Test Period, to be less than 3.00 to 1.0.


 


(c)           Limitation on Capital Expenditures.  Make any Capital Expenditures in any period
of four consecutive quarters in excess of 20% of Consolidated Net Worth
(determined as of the last day of the most recent quarter for which financial
statements have been delivered); provided, however, that the foregoing limitation shall not apply if
(i) Liquidity (determined as of such day) is greater than $10.0 million and (ii)
either:


 


(A)          (1) no Default or
Event of Default then exists that has not been cured or waived, and (2) the
Leverage Ratio (determined as of such day) is less than 2.75 to 1.0; or


 


(B)                                 the Leverage Ratio is
less than 2.75 to 1.0 for both the quarter ending on such day (determined as of
such day) and for the preceding quarter (determined as of the last day of such
preceding quarter).


 


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SECTION 6.09.    Limitation
on Modifications or Prepayment of Indebtedness; Modifications of Certificate of
Incorporation, or Other Constitutive Documents, By laws and Certain Other
Agreements, etc. 
(i) Optionally prepay, retire, redeem, purchase, defease or exchange,
or make or arrange for any mandatory prepayment, retirement, redemption,
purchase or defeasance of, any outstanding Indebtedness (other than (1) any
refinancing of Indebtedness permitted by this Agreement, (2) the Obligations
and (3) the conversion or exchange of Indebtedness for or into Equity
Interest); (ii) amend or modify, or permit the amendment or modification
of, any provision of existing Indebtedness or of any agreement (including any
purchase agreement, indenture, loan agreement or security agreement) relating
thereto other than any amendments or modifications to Indebtedness which do not
in any way materially adversely affect the interests of the Lenders and are
otherwise permitted under Section 6.01(b); (iii) make (or give any notice
in respect thereof) any voluntary or optional payment or prepayment on or
redemption or acquisition for value of, or any prepayment or redemption as a
result of any asset sale, change of control or similar event of, any indebtedness
outstanding under any document or agreement relating to any Permitted
Subordinated Indebtedness; (iv) amend or modify, or permit the amendment or
modification of, any provision of any document or agreement relating to any
Permitted Subordinated Indebtedness other than amendments or modifications
which do not in any way materially adversely affect the interests of the
Lenders; or (v) amend, modify or change its articles of incorporation or other
constitutive documents (including by the filing or modification of any certificate
of designation) or by laws, or any agreement entered into by it, with respect
to its capital stock (including the Shareholders’ Agreement, any other
shareholders’ agreement, limited liability company operating agreement or
limited partnership agreement), or enter into any new agreement with respect to
its capital stock, other than any amendments, modifications, agreements or
changes pursuant to this clause (v) or any such new agreements pursuant to this
clause (v) which do not in any way materially adversely affect in any material
respect the interests of the Lenders; and provided
that Borrower may issue such capital stock as is not prohibited by Section 6.11
or any other provision of this Agreement and may amend articles of
incorporation or other constitutive documents to authorize any such capital
stock.


 


SECTION 6.10.    Limitation
on Certain Restrictions on Subsidiaries.  Directly or indirectly, create or otherwise
cause or suffer to exist or become effective any encumbrance or restriction on
the ability of any Subsidiary to (a) pay dividends or make any other
distributions on its Equity Interests owned by Borrower or any Subsidiary of Borrower,
or pay any Indebtedness owed to Borrower or a Subsidiary of Borrower, (b) make
loans or advances to Borrower or any of Borrower’s Subsidiaries or (c) transfer
any of its properties to Borrower or any of Borrower’s Subsidiaries, except for
such encumbrances or restrictions existing under or by reason of (i) applicable
law; (ii) this Agreement and the other Loan Documents; (iii) any document or
agreement relating to Permitted Subordinated Indebtedness; (iv) customary
provisions restricting subletting or assignment of any lease governing a
leasehold interest of Borrower or a Subsidiary of Borrower; (v) customary provisions
restricting assignment of any agreement entered into by Borrower or a
Subsidiary of Borrower in the ordinary course of business; (vi) any holder of a
Lien permitted by Section 6.02 may restrict the transfer of the asset or
assets subject thereto; (vii) restrictions which are not more restrictive than
those contained in this Agreement contained in any documents governing any
Indebtedness incurred after the Closing Date in accordance with the provisions
of this Agreement; (viii) customary restrictions and conditions contained in
any agreement relating to the sale of any property permitted under Section
6.05 pending the consummation of such sale; (ix) any agreement in effect at
the time such Subsidiary becomes a Subsidiary of Borrower, so long as such
agreement was not entered into in contemplation of such person becoming a
Subsidiary of Borrower; or (x) in the case of any joint venture which is not a
Loan Party in respect of any matters referred to in clauses (b) and (c) above,
restrictions in such person’s organizational or governing documents or pursuant
to any joint venture agreement or stockholders agreements solely to the extent
of the Equity Interests of or assets held in the subject joint venture or other
entity.


 


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SECTION 6.11.    Limitation
on Issuance of Capital Stock.


 


(a)           With respect to Borrower, issue any
Equity Interest that is not Qualified Capital Stock.


 


(b)           Borrower will not, and will not
permit any Subsidiary to, issue any Equity Interest (including by way of sales
of treasury stock) or any options or warrants to purchase, or securities convertible
into, Equity Interest, except (i) for stock splits, stock dividends and
additional Equity Interests issuances which do not decrease the percentage
ownership of Borrower or any Subsidiaries in any class of the Equity Interest
of such Subsidiary; (ii) Subsidiaries of Borrower formed after the Closing Date
pursuant to Section 6.12 may issue Equity Interests to Borrower or the
Subsidiary of Borrower which is to own such stock; and (iii) Borrower may issue
common stock that is Qualified Capital Stock to Borrower.  All Equity Interests issued in accordance
with this Section 6.11(b) shall, to the extent required by Section
5.12 or the Security Agreement, be delivered to the Collateral Agent for
pledge pursuant to the Security Agreement.


 


SECTION 6.12.    Limitation
on Creation of Subsidiaries.  Establish, create or acquire any additional
Subsidiaries without the prior written consent of the Required Lenders; provided that Borrower may establish,
create or acquire one or more Wholly Owned Subsidiaries of Borrower or one of
its Wholly Owned Subsidiaries without such consent so long as (a) 100% of the
Equity Interest of any new Subsidiary is upon the creation or establishment of
any such new Subsidiary pledged and delivered to the Collateral Agent for the
benefit of the Secured Parties under the Security Agreement, (other than non-Wholly
Owned Subsidiaries acquired in connection with a Permitted Acquisition or
pursuant to Investments pursuant to Section 6.04(h)); (b) upon the
creation or establishment of any such new Wholly Owned Subsidiary, such Subsidiary
becomes a party to the applicable Security Documents and shall become a
Subsidiary Guarantor hereunder and execute a Joinder Agreement and the other
Loan Documents all in accordance with Section 5.11(a) above and (c) such
new Subsidiary is a Domestic Subsidiary.


 


SECTION 6.13.    Business.  With respect to Borrower and its Subsidiaries,
engage (directly or indirectly) in any business other than those businesses in
which each of Borrower and its Subsidiaries, respectively, is engaged on the Third
Amendment and Restatement Effective Date (or which are substantially related
thereto or are reasonable extensions thereof).


 


SECTION 6.14.    Limitation
on Accounting Changes.  Make or permit any change in accounting
policies or reporting practices, without the consent of the Required Lenders,
which consent shall not be unreasonably withheld, except changes that, in the aggregate,
could not reasonably be expected to result in a Material Adverse Effect or are
required by GAAP.


 


SECTION 6.15.    Fiscal Year.  Change its fiscal year end to a date other
than December 31.


 


SECTION 6.16.    Lease
Obligations. 
Create, incur, assume or suffer to exist any obligations as lessee for
the rental or hire of real or personal property of any kind under leases or
agreements to lease having an original term of one year or more that would
cause the direct and contingent liabilities of Borrower and its Subsidiaries,
on a consolidated basis, in respect of all such obligations to exceed $5.0
million payable in any period of 12 consecutive months.


 


SECTION 6.17.    Limitation
on Further Negative Pledges.  Except with respect to prohibitions against
other encumbrances on specific property encumbered to secured payment of
particular Indebtedness permitted hereunder or prohibitions in license agreements
under which Borrower or any of its Subsidiaries is the licensee, enter into any
agreement to create, incur, assume or suffer to exist any Lien upon any of its
property, assets or revenues, whether now owned or hereafter acquired, except
pursuant to (a) the Loan Documents, (b) any other agreement that does not
restrict in any manner (directly or indirectly)


 


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Liens created pursuant to the Loan Documents on property or assets of Borrower
or any of its Subsidiaries (whether now owned or hereafter acquired) securing
the Loans or any Interest Rate Agreement and does not require the direct or
indirect granting of any Lien securing any Indebtedness or other obligation by
virtue of the granting of Liens on or pledge of property of Borrower of any of
its Subsidiaries to secure the Loans, any Interest Rate Agreement or any other
Obligations and (c) any industrial revenue or development bonds, acquisition
agreement or operating leases of real property and equipment entered into in
the ordinary course of business.  Notwithstanding
any of the foregoing, Indebtedness incurred by a Non Guarantor Subsidiary may
contain a provision that no Lien on the assets of such Non Guarantor Subsidiary
may exist unless such Indebtedness is equally and ratably secured with any
other Indebtedness secured by such assets.


 


SECTION 6.18.    Anti-Terrorism
Law; Anti-Money Laundering.


 


(a)           Directly or indirectly,
(i) knowingly conduct any business or engage in making or receiving any contribution
of funds, goods or services to or for the benefit of any person described in Section 3.24,
(ii) knowingly deal in, or otherwise engage in any transaction relating
to, any property or interests in property blocked pursuant to the Executive
Order or any other Anti-Terrorism Law, or (iii) knowingly engage in or
conspire to engage in any transaction that evades or avoids, or has the purpose
of evading or avoiding, or attempts to violate, any of the prohibitions set
forth in any Anti-Terrorism Law (and the Loan Parties shall deliver to the
Lenders any certification or other evidence requested from time to time by any
Lender in its reasonable discretion, confirming the Loan Parties’ compliance
with this Section 6.18).


 


(b)           Knowingly cause or permit any of the
funds of such Loan Party that are used to repay the Loans to be derived from
any unlawful activity with the result that the making of the Loans would be in
violation of any Requirement of Law.


 


ARTICLE VII


 


GUARANTEE


 


SECTION 7.01.    The Guarantee.  The Subsidiary Guarantors hereby jointly and
severally guarantee as a primary obligor and not as a surety to each Secured
Party and their respective successors and assigns the prompt payment in full
when due (whether at stated maturity, by acceleration or otherwise) of the
principal of and interest (including any interest, fees, costs or charges that
would accrue but for the provisions of the Title 11 of the United States Code
after any bankruptcy or insolvency petition under Title 11 of the United States
Code) on the Loans made by the Lenders to, and the Notes held by each Lender
of, Borrower, and all other Obligations from time to time owing to the Secured
Parties by any Loan Party under any Loan Document or Interest Rate Agreement
relating to the Loans, in each case strictly in accordance with the terms
thereof (such obligations being herein collectively called the “Guaranteed Obligations”).  The Subsidiary Guarantors hereby jointly and
severally agree that if Borrower or other Subsidiary Guarantor(s) shall fail to
pay in full when due (whether at stated maturity, by acceleration or otherwise)
any of the Guaranteed Obligations, the Subsidiary Guarantors will promptly pay
the same, without any demand or notice whatsoever, and that in the case of any
extension of time of payment or renewal of any of the Guaranteed Obligations,
the same will be promptly paid in full when due (whether at extended maturity,
by acceleration or otherwise) in accordance with the terms of such extension or
renewal.


 


SECTION 7.02.    Obligations
Unconditional. 
The obligations of the Subsidiary Guarantors under Section 7.01 shall
constitute a guaranty of payment and are absolute, irrevocable and
unconditional, joint and several, irrespective of the value, genuineness,
validity, regularity or enforceability of the


 


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Guaranteed Obligations of Borrower under this Agreement, the Notes, if
any, or any other agreement or instrument referred to herein or therein, or any
substitution, release or exchange of any other guarantee of or security for any
of the Guaranteed Obligations, and, to the fullest extent permitted by
applicable law, irrespective of any other circumstance whatsoever that might
otherwise constitute a legal or equitable discharge or defense of a surety or
guarantor (except for payment in full). 
Without limiting the generality of the foregoing, it is agreed that the
occurrence of any one or more of the following shall not alter or impair the
liability of the Subsidiary Guarantors hereunder which shall remain absolute,
irrevocable and unconditional under any and all circumstances as described
above:


 


(i)            at
any time or from time to time, without notice to the Subsidiary Guarantors, the
time for any performance of or compliance with any of the Guaranteed
Obligations shall be extended, or such performance or compliance shall be
waived;


 


(ii)           any
of the acts mentioned in any of the provisions of this Agreement or the Notes,
if any, or any other agreement or instrument referred to herein or therein
shall be done or omitted;


 


(iii)          the
maturity of any of the Guaranteed Obligations shall be accelerated, or any of
the Guaranteed Obligations shall be amended in any respect, or any right under
the Loan Documents or any other agreement or instrument referred to herein or
therein shall be amended or waived in any respect or any other guarantee of any
of the Guaranteed Obligations or any security therefor shall be released or
exchanged in whole or in part or otherwise dealt with;


 


(iv)          any
lien or security interest granted to, or in favor of, Issuing Bank or any
Lender or Agent as security for any of the Guaranteed Obligations shall fail to
be perfected; or


 


(v)           the
release of any other Guarantor.


 


The Subsidiary
Guarantors hereby expressly waive diligence, presentment, demand of payment,
protest and all notices whatsoever, and any requirement that any Subsidiary
Guarantor thereof exhaust any right, power or remedy or proceed against Borrower
under this Agreement or the Notes, if any, or any other agreement or instrument
referred to herein or therein, or against any other person under any other
guarantee of, or security for, any of the Guaranteed Obligations.  The Subsidiary Guarantors waive any and all
notice of the creation, renewal, extension, waiver, termination or accrual of
any of the Guaranteed Obligations and notice of or proof of reliance by any
Secured Party upon this Guarantee or acceptance of this Guarantee, and the
Guaranteed Obligations, and any of them, shall conclusively be deemed to have
been created, contracted or incurred in reliance upon this Guarantee, and all
dealings between Borrower and the Secured Parties shall likewise be
conclusively presumed to have been had or consummated in reliance upon this
Guarantee.  This Guarantee shall be
construed as a continuing, absolute, irrevocable and unconditional guarantee of
payment without regard to any right of offset with respect to the Guaranteed
Obligations at any time or from time to time held by Secured Parties, and the
obligations and liabilities of the Subsidiary Guarantors hereunder shall not be
conditioned or contingent upon the pursuit by the Secured Parties or any other
person at any time of any right or remedy against Borrower or against any other
person which may be or become liable in respect of all or any part of the
Guaranteed Obligations or against any collateral security or guarantee therefor
or right of offset with respect thereto. 
This Guarantee shall remain in full force and effect and be binding in
accordance with and to the extent of its terms upon the Subsidiary Guarantors
and the successors and assigns thereof, and shall inure to the benefit of the
Lenders, and their respective successors and assigns, notwithstanding that from
time to time during the term of this Agreement there may be no Guaranteed
Obligations outstanding.


 


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SECTION 7.03.    Reinstatement.  The obligations of the Subsidiary Guarantors
under this Article VII shall be automatically reinstated if and to the extent
that for any reason any payment by or on behalf of Borrower or other Loan Party
in respect of the Guaranteed Obligations is rescinded or must be otherwise
restored by any holder of any of the Guaranteed Obligations, whether as a
result of any proceedings in bankruptcy or reorganization or otherwise.  The Subsidiary Guarantors jointly and
severally agree that they will indemnify each Secured Party on demand for all
reasonable costs and expenses (including reasonable fees of counsel) incurred
by such Secured Party in connection with such rescission or restoration,
including any such costs and expenses incurred in defending against any claim
alleging that such payment constituted a preference, fraudulent transfer or
similar payment under any bankruptcy, insolvency or similar law, other than any
costs or expenses resulting from the bad faith or willful misconduct of such Secured
Party.


 


SECTION 7.04.    Subrogation;
Subordination. 
Each Guarantor hereby agrees that until the indefeasible payment and
satisfaction in full in cash of all Guaranteed Obligations and the expiration
and termination of the Commitments of the Lenders under this Agreement it shall
not exercise any right or remedy arising by reason of any performance by it of
its guarantee in Section 7.01, whether by subrogation or otherwise,
against Borrower or any other Guarantor of any of the Guaranteed Obligations or
any security for any of the Guaranteed Obligations.  The payment of any amounts due with respect
to any Indebtedness of Borrower or any other Guarantor now or hereafter owing
to any Guarantor or Borrower by reason of any payment by such Guarantor under
the Guarantee in this Article VII is hereby subordinated to the prior
indefeasible payment in full in cash of the Guaranteed Obligations.  In addition, any Indebtedness of Borrower now
or hereafter held by any Guarantor is hereby subordinated in right of payment
in full in cash to the Guaranteed Obligations. 
Each Guarantor agrees that it will not demand, sue for or otherwise
attempt to collect any such Indebtedness of Borrower to such Guarantor until
the Obligations shall have been indefeasibly paid in full in cash.  If, notwithstanding the foregoing sentence,
any Guarantor shall prior to the indefeasible payment in full in cash of the
Guaranteed Obligations collect, enforce or receive any amounts in respect of
such Indebtedness, such amounts shall be collected, enforced and received by
such Guarantor as trustee for the Secured Parties and be paid over to
Administrative Agent on account of the Guaranteed Obligations without affecting
in any manner the liability of such Guarantor under the other provisions of the
guaranty contained herein.


 


SECTION 7.05.    Remedies.  The Subsidiary Guarantors jointly and
severally agree that, as between the Subsidiary Guarantors and the Lenders, the
obligations of Borrower under this Agreement and the Notes, if any, may be
declared to be forthwith due and payable as provided in Article VIII
(and shall be deemed to have become automatically due and payable in the circumstances
provided in said Article VIII) for purposes of Section 7.01,
notwithstanding any stay, injunction or other prohibition preventing such
declaration (or such obligations from becoming automatically due and payable)
as against Borrower and that, in the event of such declaration (or such
obligations being deemed to have become automatically due and payable), such
obligations (whether or not due and payable by Borrower) shall forthwith become
due and payable by the Subsidiary Guarantors for purposes of Section 7.01.


 


SECTION 7.06.    Instrument
for the Payment of Money.  Each Guarantor hereby acknowledges that the
guarantee in this Article VII constitutes an instrument for the payment
of money, and consents and agrees that any Lender or Agent, at its sole option,
in the event of a dispute by such Guarantor in the payment of any moneys due
hereunder, shall have the right to bring a motion action under New York CPLR
Section 3213.


 


SECTION 7.07.    Continuing
Guarantee. 
The guarantee in this Article VII is a continuing guarantee of
payment, and shall apply to all Guaranteed Obligations whenever arising.


 


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SECTION 7.08.    General
Limitation on Guarantee Obligations.  In any action or proceeding involving any
state corporate law, or any state, federal or foreign bankruptcy, insolvency,
reorganization or other law affecting the rights of creditors generally, if the
obligations of any Guarantor under Section 7.01 would otherwise be held
or determined to be void, voidable, invalid or unenforceable, or subordinated
to the claims of any other creditors, on account of the amount of its liability
under Section 7.01, then, notwithstanding any other provision to the
contrary, the amount of such liability shall, without any further action by
such Guarantor, any Loan Party or any other person, be automatically limited
and reduced to the highest amount that is valid and enforceable and not subordinated
to the claims of other creditors as determined in such action or proceeding.


 


ARTICLE VIII


 


EVENTS OF
DEFAULT


 


SECTION 8.01.    Events
of Default. 
In case of the happening of any of the following events (“Events of Default”):


 


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


 


(b)           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 (a) 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 10 Business Days;


 


(c)           any
representation or warranty made or deemed made in or in connection with any
Loan Document or the borrowings or issuances of Letters of Credit 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;


 


(d)           default
shall be made in the due observance or performance by any Company of any
covenant, condition or agreement contained in Section 5.02, 5.03
or 5.08 or in Article VI;


 


(e)           default
shall be made in the due observance or performance by any Company of any
covenant, condition or agreement contained in any Loan Document (other than
those specified in (a), (b) or (d) above) and such default shall continue
unremedied or shall not be waived for a period of 30 days after written notice
thereof from the Administrative Agent or any Lender to Borrower;


 


(f)            any
Company shall (i) fail to pay any principal or interest, regardless of amount,
due in respect of any Indebtedness (other than the Obligations), when and as
the same shall become due and payable, or (ii) fail to observe or perform
(after applicable grace periods, if any) any other term, covenant, condition or
agreement contained in any agreement or instrument evidencing or governing any
such Indebtedness if the effect of any failure referred to in this clause (ii)
is to cause, or to permit the holder or holders of such Indebtedness or a
trustee on its or their behalf (with or without the giving of notice, the lapse
of time or both) to cause, such Indebtedness to become due prior to its stated
maturity; provided that it shall
not constitute an Event of Default


 


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pursuant to this paragraph (f) unless the
aggregate amount of all such Indebtedness referred to in clauses (i) and
(ii) exceeds $1.0 million at any one time;


 


(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 any
Company, or of a substantial part of the property or assets of any Company,
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 any Company or for
a substantial part of the property or assets of any Company; or (iii) the
winding up or liquidation of any Company; 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)           any
Company 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 any Company or for a substantial part of the property or
assets of any Company; (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; (vii) take
any action for the purpose of effecting any of the foregoing; or (viii) wind up
or liquidate;


 


(i)            one
or more judgments for the payment of money in an aggregate amount in excess of
$2.5 million shall be rendered against any Company 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 any Company to enforce any such judgment;


 


(j)            an
ERISA Event shall have occurred that, in the opinion of the Required Lenders,
when taken together with all other such ERISA Events, could reasonably be
expected to result in a Material Adverse Effect or the imposition of a Lien on
any assets of a Company;


 


(k)           any
security interest and Lien purported to be created by any Security Document
shall cease to be in full force and effect, or shall cease to give the
Collateral Agent, for the benefit of the Secured Parties, the Liens, rights,
powers and privileges purported to be created and granted under such Security
Documents (including a perfected first priority security interest in and Lien
on, all of the Collateral thereunder (except as otherwise expressly provided in
such Security Document)) in favor of the Collateral Agent, or shall be asserted
by Borrower or any other Loan Party not to be, a valid, perfected, first
priority (except as otherwise expressly provided in this Agreement or such
Security Document) security interest in or Lien on the Collateral covered
thereby unless such occurrence results solely from action of the Collateral
Agent or any Lender and involves no Default by Borrower or any Guarantor
hereunder or under any Security Document;


 


(l)            the
Guarantees shall cease to be in full force effect;


 


(m)          any
Loan Document or any material provisions thereof shall at any time and for any
reason be declared by a court of competent jurisdiction to be null and void, or
a proceeding


 


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shall be commenced by any Loan Party or any
other person, or by any Governmental Authority, seeking to establish the
invalidity or unenforceability thereof (exclusive of questions of
interpretation of any provision thereof), or any Loan Party shall repudiate or
deny that it has any liability or obligation for the payment of principal or interest
or other obligations purported to be created under any Loan Document;


 


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


 


(o)           any
Loan Party shall be prohibited or otherwise restrained from conducting the
business theretofore conducted by it in any manner that has or could reasonably
be expected to result in a Material Adverse Effect by virtue of any
determination, ruling, decision, decree or order of any court or Governmental
Authority of competent jurisdiction;


 


then, and in
every such event (other than an event with respect to 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 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 and
Reimbursement Obligations then outstanding to be forthwith due and payable in
whole or in part, whereupon the principal of the Loans and Reimbursement
Obligations so declared to be due and payable, together with accrued interest
thereon and any unpaid accrued Fees and all other liabilities of 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 Borrower and the Subsidiary
Guarantors, anything contained herein or in any other Loan Document to the
contrary notwithstanding; and in any event with respect to Borrower described
in paragraph (g) or (h) above, the Commitments shall automatically terminate
and the principal of the Loans and Reimbursement Obligations then outstanding,
together with accrued interest thereon and any unpaid accrued Fees and all
other liabilities of 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 Borrower and the Subsidiary Guarantors, anything contained
herein or in any other Loan Document to the contrary notwithstanding.


 


ARTICLE IX


 


COLLATERAL
ACCOUNT; APPLICATION OF COLLATERAL PROCEEDS


 


SECTION 9.01.    Collateral
Account.


 


(a)           The Collateral Agent is hereby
authorized to establish and maintain at its office at 677 Washington Boulevard,
Stamford, Connecticut 06901, in the name of the Collateral Agent and pursuant
to a Control Agreement, a restricted deposit account designated “Basic Energy
Services Collateral Account”.  Each Loan
Party shall deposit into the Collateral Account from time to time (i) the cash
proceeds of any of the Collateral (including pursuant to any disposition
thereof) to the extent contemplated herein or in any other Loan Document, (ii)
the cash proceeds of any Casualty Event with respect to Collateral, to the
extent contemplated herein or in any other Loan Document, and (iii) any cash
such Loan Party is required to pledge as additional collateral security hereunder
pursuant to the Loan Documents.


 


(b)           The balance from time to time in the
Collateral Account shall constitute part of the Collateral and shall not
constitute payment of the Obligations until applied as hereinafter
provided.  So long as no Event of Default
has occurred and is continuing or will result therefrom, the Collateral Agent
shall within two Business Days of receiving a request of the applicable Loan
Party for release of cash proceeds (i) from the Collateral Account constituting
Net Cash Proceeds relating to any Casualty Event or Asset


 


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Sale remit such cash proceeds on deposit in
the Collateral Account to or upon the order of such Loan Party, so long as such
Loan Party has satisfied the conditions relating thereto set forth in Section
9.02 and (ii)  with respect to the LC Sub
Account, remit such Net Cash Proceeds on deposit in the LC Sub Account to or
upon the order of such Loan Party at such time as all Letters of Credit shall
have been terminated and all of the liabilities in respect of the Letters of
Credit have been paid in full.  At any
time following the occurrence and during the continuance of an Event of
Default, the Collateral Agent may (and, if instructed by the Required Lenders
as specified herein, shall) in its (or their) discretion apply or cause to be
applied (subject to collection) the balance from time to time outstanding to
the credit of the Collateral Account to the payment of the Obligations in the
manner specified in Section 9.03 hereof subject, however, in the case of
amounts deposited in the LC Sub Account, to the provisions of Sections
2.18(i) and 9.03.  The Loan Parties
shall have no right to withdraw, transfer or otherwise receive any funds
deposited in the Collateral Account except to the extent specifically provided
herein.


 


(c)           Amounts on deposit in the Collateral
Account shall be invested from time to time in Cash Equivalents as the
applicable Loan Party (or, after the occurrence and during the continuance of an
Event of Default, the Collateral Agent) shall determine, which Cash Equivalents
shall be held in the name and be under the control of the Collateral Agent (or
any sub agent); provided that at
any time after the occurrence and during the continuance of an Event of
Default, the Collateral Agent may (and, if instructed by the Required Lenders
as specified herein, shall) in its (or their) discretion at any time and from
time to time elect to liquidate any such Cash Equivalents and to apply or cause
to be applied the proceeds thereof to the payment of the Obligations in the
manner specified in Section 9.03 hereof.


 


(d)           Amounts deposited into the Collateral
Account as cover for liabilities in respect of Letters of Credit under any
provision of this Agreement requiring such cover shall be held by the Administrative
Agent in a separate sub account designated as the “LC Sub Account” (the “LC Sub Account”) and, notwithstanding any
other provision hereof to the contrary, all amounts held in the LC Sub Account
shall constitute collateral security first
for the liabilities in respect of Letters of Credit outstanding from time to
time and second for the other
Obligations hereunder until such time as all Letters of Credit shall have been
terminated and all of the liabilities in respect of Letters of Credit have been
paid in full.


 


SECTION 9.02.    Proceeds
of Destruction, Taking and Collateral Dispositions.  So long as no Event of Default shall have occurred
and be continuing, in the event the applicable Loan Party elects to reinvest
Net Cash Proceeds in respect of any Asset Sale or Casualty Event in accordance
with the provisions of Sections 2.10(c) and 2.10(f) as
applicable, the Collateral Agent shall receive at least 10 days’ prior notice
of each request for payment and shall not release any part of such Net Cash
Proceeds, until the applicable Loan Party has furnished to the Collateral Agent
(i) an Officers’ Certificate setting forth: 
(A) a brief description of the reinvestment to be made, (B) the dollar
amount of the expenditures to be made, or costs incurred by such Loan Party in
connection with such reinvestment and (C) evidence that the properties or
assets acquired in connection with such reinvestment have a fair market value
at least equal to the amount of such Net Cash Proceeds requested to be released
from the Collateral Account and (ii) all security agreements and Mortgages and
other items required by the provisions of Sections 5.11 and 5.12
to, among other things, subject such reinvestment properties or assets to the
Lien of the Security Documents in favor of the Collateral Agent, for its
benefit and for the benefit of the other Secured Parties.


 


SECTION 9.03.    Application
of Proceeds. 
The proceeds received by the Collateral Agent in respect of any sale of,
collection from or other realization upon all or any part of the Collateral
pursuant to the exercise by the Collateral Agent of its remedies shall be
applied, together with any other sums then held by the Collateral Agent
pursuant to this Agreement, promptly by the Collateral Agent as follows:


 


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(a)           First,
to the payment of all reasonable costs and expenses, fees, commissions and
taxes of such sale, collection or other realization including, without
limitation, compensation to the Collateral Agent and its agents and counsel,
and all expenses, liabilities and advances made or incurred by the Collateral
Agent in connection therewith, together with interest on each such amount at
the highest rate then in effect under this Agreement from and after the date
such amount is due, owing or unpaid until paid in full;


 


(b)           Second,
to the payment of all other reasonable costs and expenses of such sale,
collection or other realization including, without limitation, compensation to
the other Secured Parties and their agents and counsel and all costs, liabilities
and advances made or incurred by the other Secured Parties in connection
therewith, together with interest on each such amount at the highest rate then
in effect under this Agreement from and after the date such amount is due,
owing or unpaid until paid in full;


 


(c)           Third,
without duplication of amounts applied pursuant to clauses (a) and (b) above,
to the indefeasible payment in full in cash, pro
rata, of (i) interest, principal and other amounts constituting
Obligations (other than the obligations arising under the Hedging Agreements
and the principal amount of Reimbursement Obligations) in each case equally and
ratably in accordance with the respective amounts thereof then due and owing
and (ii) the Obligations arising under the Hedging Agreements in
accordance with the terms of the Hedging Agreements;


 


(d)           Fourth,
to the indefeasible payment in full in cash, pro rata, of the principal amount
of Reimbursement Obligations; and


 


(e)           Fifth,
the balance, if any, to the person lawfully entitled thereto (including the
applicable Loan Party or its successors or assigns).


 


In the event
that any such proceeds are insufficient to pay in full the items described in
clauses (a) through (e) of this Section 9.03, the Loan Parties shall
remain jointly and severally liable for any deficiency.


 


ARTICLE X


 


THE
ADMINISTRATIVE AGENT AND THE COLLATERAL AGENT


 


SECTION 10.01. Appointment.  Each Lender hereby irrevocably designates and
appoints each of the Administrative Agent and the Collateral Agent as an agent
of such Lender under this Agreement and the other Loan Documents.  Each Lender irrevocably authorizes each
Agent, in such capacity, through its agents or employees, to take such actions
on its behalf under the provisions of this Agreement and the other Loan
Documents and to exercise such powers and perform such duties as are expressly
delegated to such Agent by the terms of this Agreement and the other Loan
Documents, together with such actions and powers as are reasonably incidental
thereto.


 


SECTION 10.02. Agent in Its Individual Capacity.  Each person serving as an 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
person and its Affiliates may accept deposits from, lend money to and generally
engage in any kind of business with Borrower or any Subsidiary or other
Affiliate thereof as if it were not an Agent hereunder.


 


SECTION 10.03. Exculpatory Provisions.  No Agent shall have any duties or obligations
except those expressly set forth in the Loan Documents.  Without limiting the generality of the
foregoing,


 


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(a) no Agent shall be subject to any fiduciary or other implied duties,
regardless of whether a Default has occurred and is continuing, (b) no Agent
shall have any duty to take any discretionary action or exercise any
discretionary powers, except discretionary rights and powers expressly
contemplated by the Loan Documents that such Agent is required to exercise in
writing by the Required Lenders (or such other number or percentage of the
Lenders as shall be necessary under the circumstances as provided in Section 11.02),
and (c) except as expressly set forth in the Loan Documents, no Agent shall
have any duty to disclose or shall be liable for the failure to disclose, any
information relating to Borrower or any of its Subsidiaries that is
communicated to or obtained by the bank serving as such Agent or any of its Affiliates
in any capacity.  No 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
11.02) or in the absence of its own gross negligence or willful
misconduct.  No Agent shall be deemed to
have knowledge of any Default unless and until written notice thereof is given
to such Agent by Borrower or a Lender, and no 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.


 


SECTION 10.04. Reliance by Agent.  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 a proper person.  Each Agent also may rely upon any statement
made to it orally or by telephone and believed by it to be made by a proper person,
and shall not incur any liability for relying thereon.  Each Agent may consult with legal counsel
(who may be counsel for Borrower), independent accountants and other advisors
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 advisors.


 


SECTION 10.05. Delegation of Duties.  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 such Agent.  Each Agent and
any such sub agent may perform any and all its duties and exercise its rights
and powers through their respective Affiliates. 
The exculpatory provisions of the preceding paragraphs shall apply to
any such sub agent and to the Affiliates of each Agent and any such sub agent,
and shall apply to their respective activities in connection with the
syndication of the credit facilities provided for herein as well as activities
as Agent.


 


SECTION 10.06. Successor
Agent.  Each Agent
may resign as such at any time upon at least 30 days’ prior notice to the
Lenders, the Issuing Bank and Borrower. 
Upon any such resignation, the Required Lenders shall have the right, in
consultation with Borrower, to appoint a successor Agent from among the
Lenders.  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, then
the retiring Agent may, on behalf of the Lenders and the Issuing Bank, appoint
a successor Agent, which successor shall be a commercial banking institution
organized under the laws of the United States (or any State thereof) or a
United States branch or agency of a commercial banking institution, in each
case, having combined capital and surplus of at least $250 million; provided that if such retiring Agent is
unable to find a commercial banking institution which is willing to accept such
appointment and which meets the qualifications set forth above, the retiring
Agent’s resignation shall nevertheless thereupon become effective, and the Lenders
shall assume and perform all of the duties of the Agent hereunder until such
time, if any, as the Required Lenders appoint a successor Agent.


 


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Upon the
acceptance of its appointment as an 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 Borrower to a successor
Agent shall be the same as those payable to its predecessor unless otherwise
agreed between Borrower and such successor. 
After an Agent’s resignation hereunder, the provisions of this Article
X and Section 11.03 shall continue in effect for the benefit of such
retiring Agent, its sub agents and their respective Affiliates in respect of
any actions taken or omitted to be taken by any of them while it was acting as
Agent.


 


SECTION 10.07. Non Reliance on Agent and Other Lenders.  Each Lender acknowledges that it has, independently
and without reliance upon any Agent 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 any Agent 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, any other Loan Document or related
agreement or any document furnished hereunder or thereunder.


 


SECTION 10.08. No Other Administrative Agent.  The Lenders identified in this Agreement, the
Syndication Agent and the Documentation Agent shall not have any right, power,
obligation, liability, responsibility or duty under this Agreement other than
those applicable to all Lenders.  Without
limiting the foregoing, neither the Syndication Agent nor the Documentation
Agent shall have or be deemed to have a fiduciary relationship with any Lender.  Each Lender hereby makes the same acknowledgments
with respect to the Syndication Agent and the Documentation Agent as it makes
with respect to the Administrative Agent or any other Lender in this Article
X.  Notwithstanding the foregoing,
the parties hereto acknowledge that the Documentation Agent and the Syndication
Agent hold such titles in name only, and that such titles confer no additional
rights or obligations relative to those conferred on any Lender hereunder.


 


SECTION 10.09. Indemnification.  The Lenders severally agree to indemnify each
Agent in its capacity as such (to the extent not reimbursed by Borrower or the Subsidiary
Guarantors and without limiting the obligation of Borrower or the Subsidiary
Guarantors to do so), ratably according to their respective outstanding Loans
and Commitments in effect on the date on which indemnification is sought under
this Section (or, if indemnification is sought after the date upon which all
Commitments shall have terminated and the Loans and Reimbursement Obligations
shall have been paid in full, ratably in accordance with such outstanding Loans
and Commitments as in effect immediately prior to such date), from and against
any and all liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses or disbursements of any kind whatsoever that may at any
time (whether before or after the payment of the Loans and Reimbursement Obligations)
be imposed on, incurred by or asserted against such Agent in any way relating
to or arising out of, the Commitments, this Agreement, any of the other Loan
Documents or any documents contemplated by or referred to herein or therein or
the transactions contemplated hereby or thereby or any action taken or omitted
by such Agent under or in connection with any of the foregoing; provided that no Lender shall be liable
for the payment of any portion of such liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
that are found by a final and nonappealable decision of a court of competent
jurisdiction to have resulted from such Agent’s gross negligence or willful
misconduct.  The agreements in this
Section shall survive the payment of the Loans and all other amounts payable
hereunder.


 


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ARTICLE XI


 


MISCELLANEOUS


 


SECTION 11.01. Notices.  Notices and other communications provided for
herein shall be in writing and shall be delivered by hand or overnight courier
service, mailed by certified or registered mail or sent by telecopy, as follows:


 


(a)           if
to any Loan Party, to Borrower at:


 


Basic Energy Services, Inc.

400 W. Illinois

Midland, Texas  79701

Attention:  Kenneth V. Huseman

Telecopy No.:   (432) 620 5501

Telephone No.: (432) 620 5500

E mail:  ken.huseman@basicenergyservices.com


 


with a copy to:


 


Andrews Kurth LLP

600 Travis, Suite 4200

Houston, Texas  77002

Attention:  Douglas Dillon, Esq.

Telecopy No.:   (713) 220 4285

Telephone No.: (713) 220 4200

E mail:  ddillon@akllp.com


 


(b)           if
to the Administrative Agent or the Collateral Agent, to it at:


 


UBS AG, Stamford Branch

677 Washington Boulevard

Stamford, Connecticut  06901

Attention:  Joselin Fernandes

Telecopy No.:  (203) 719-4308;


 


with a copy to:


 


Cahill Gordon & Reindel llp

80 Pine Street

New York, New York  10005

Attention:  Michael E. Michetti, Esq.

Telecopy:  (212) 269 5420

Telephone:  (212) 701 3000

E mail:  mmichetti@cahill.com


 


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(c)           if
to the Documentation Agent, to it at:


 


Hibernia National Bank

313 Carondelet Street, 10th Floor

New Orleans, Louisiana  70130

Attention:  Energy/Maritime Division

Telecopy No.:  (504) 533-5434


 


(d)           if
to a Lender, to it at its address (or telecopy number) set forth on the
applicable Lender Addendum 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 overnight courier service or sent by telecopy
or by certified or registered mail, in each case delivered, sent or mailed
(properly addressed) to such party as provided in this Section 11.01 or
in accordance with the latest unrevoked direction from such party given in
accordance with this Section 11.01 and failure to deliver courtesy
copies of notices and other communications shall in no event affect the
validity or effectiveness of such notices and other communications.


 


SECTION 11.02. Waivers; Amendment.


 


(a)           No failure or delay by any Agent, the
Collateral Agent, the Issuing Bank or any Lender in exercising any right or
power 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 each Agent, the Issuing Bank 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 any Loan Document or consent to any departure by any
Loan Party therefrom shall in any event be effective unless the same shall be
permitted by paragraph (b) of this Section 11.02, and then such waiver
or consent shall be effective only in the specific instance and for the purpose
for which given.  Without limiting the generality
of the foregoing, the making of a Loan or issuance of a Letter of Credit shall
not be construed as a waiver of any Default, regardless of whether any Agent,
any Lender or the Issuing Bank may have had notice or knowledge of such Default
at the time.


 


(b)           Neither this Agreement nor any other
Loan Document nor any provision hereof or thereof may be waived, amended or
modified except, in the case of this Agreement, pursuant to an agreement or
agreements in writing entered into by Borrower and the Required Lenders or, in
the case of any other Loan Document, pursuant to an agreement or agreements in
writing entered into by the Administrative Agent and the Loan Party or Loan
Parties that are parties thereto, in each case with the written consent of the
Required Lenders; provided that
no such agreement shall:


 


(i)      increase
the Commitment of any Lender without the written consent of such Lender;


 


(ii)     reduce
the principal amount of any Loan or LC Disbursement or reduce the rate of
interest thereon, or reduce any Fees payable hereunder, without the written
consent of each Lender affected thereby;


 


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(iii)    postpone
or extend the maturity of any Loan, or any scheduled date of payment of or the
installment otherwise due on the principal amount of any Term B Loan under
Section 2.09, or the required date of payment of any Reimbursement Obligation,
or any date for the payment of any interest or fees payable hereunder, or
reduce the amount of, waive or excuse any such payment, or postpone the
scheduled date of expiration of any Commitment or postpone the scheduled date
of expiration of any Letter of Credit beyond the Revolving Maturity Date,
without the written consent of each Lender affected thereby;


 


(iv)    change
Section 2.14(b) or (c) in a manner that would alter the pro rata sharing of payments or setoffs
required thereby, without the written consent of each Lender;


 


(v)     change
the percentage set forth in the definition of “Required Lenders” or any other
provision of any Loan Document (including this Section) specifying the number
or percentage of Lenders (or Lenders of any Class) required to waive, amend or
modify any rights thereunder or make any determination or grant any consent
thereunder, without the written consent of each Lender (or each Lender of such
Class, as the case may be);


 


(vi)    release
Borrower or any Subsidiary Guarantor from its Guarantee (except as expressly
provided in Article VII), or limit its liability in respect of such
Guarantee, without the written consent of each Lender;


 


(vii)   release
all or a substantial portion of the Collateral from the Liens of the Security
Documents or alter the relative priorities of the Obligations entitled to the
Liens of the Security Documents (except in connection with securing additional
Obligations equally and ratably with the other Obligations), in each case
without the written consent of each Lender; or


 


(viii)  change
any 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 any
Class differently than those holding Loans of any other Class, without the
written consent of Lenders holding a majority in interest of the outstanding
Loans and unused Commitments of each affected Class;


 


provided, further, that (1) no such
agreement shall amend, modify or otherwise affect the rights or duties of the
Administrative Agent, the Collateral Agent, the Issuing Bank or the Swingline
Lender without the prior written consent of the Administrative Agent, the
Issuing Bank or the Swingline Lender, as the case may be, (2) any waiver,
amendment or modification of this Agreement that by its terms affects the
rights or duties under this Agreement of the Revolving Lenders (but not the
Term B Lenders), or the Term B Lenders (but not the Revolving Lenders) may be
effected by an agreement or agreements in writing entered into by Borrower and
requisite percentage in interest of the affected Class of Lenders that would be
required to consent thereto under this Section if such Class of Lenders were
the only Class of Lenders hereunder at the time and (3) any waiver, amendment
or modification of this Agreement that by its terms affects the rights or
duties under this Agreement of the Revolving Lenders (but not the Term B
Lenders) at a time in which an Affiliate of the Administrative Agent is a
Revolving Lender shall also require the approval of at least one Revolving
Lender not affiliated with the Administrative Agent (if any such Revolving
Lenders exist at such time). 
Notwithstanding the foregoing, any provision of this Agreement may be
amended by an agreement in writing entered into by Borrower, the Required
Lenders and the Administrative Agent (and, if their rights or obligations are
affected thereby, the Issuing Bank and the Swingline Lender) if (x) by the
terms of such agreement the Commitment of each Lender not consenting to the
amendment provided for therein shall terminate upon the effectiveness of such
amendment and (y) at the time such amendment becomes effective, each Lender not
consenting thereto receives payment in full of


 


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the principal
of and interest accrued on each Loan made by it and all other amounts owing to
it or accrued for its account under this Agreement.


 


(c)           If, in connection with any proposed
change, waiver, discharge or termination of the provisions of this Agreement as
contemplated by Section 11.02(b) (other than clause (iii) of such
Section), the consent of the Supermajority Lenders is obtained but the consent
of one or more of such other Lenders whose consent is required is not obtained,
then Borrower shall have the right to replace all, but not less than all, of
such non consenting Lender or Lenders (so long as all non consenting Lenders
are so replaced) with one or more persons pursuant to Section 2.16 so
long as at the time of such replacement each such new Lender consents to the
proposed change, waiver, discharge or termination; provided,
however, that Borrower shall not have
the right to replace a Lender solely as a result of the exercise of such Lender’s
rights (and the withholding of any required consent by such Lender) pursuant to
clause (iii) of Section 11.02(b).


 


SECTION 11.03. Expenses; Indemnity.


 


(a)           Borrower agrees to promptly pay all
reasonable out of pocket costs and expenses (including but not limited to
expenses incurred in connection with due diligence and travel, courier, reproduction,
printing and delivery expenses) (i) incurred by the Administrative Agent
and Collateral Agent, the Swingline Lender and the Issuing Bank in connection
with the syndication of the credit facilities provided for herein and the
preparation, execution, delivery and administration of this Agreement and the
other Loan Documents and the perfection and maintenance of the Liens securing
the Collateral or in connection with any amendments, consents, enforcement
costs, documentary taxes or waivers of the provisions hereof or thereof
(whether or not the transactions hereby or thereby contemplated shall be
consummated) or (ii) incurred by the Agents or after the occurrence and
during the continuation of an Event of Default 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 or Letters of
Credit issued hereunder, including the reasonable fees, charges and
disbursements of Cahill Gordon & Reindel llp,
counsel for the Administrative Agent and the Collateral Agent, and any
auditors, accountants, consultants, appraisers or other advisors and, in
connection with any such enforcement or protection, the fees, charges and
disbursements of any other counsel for the Agents or any Lender.


 


(b)           The Loan Parties agree, jointly and
severally, to indemnify the Agents, each Lender, the Issuing Bank and the
Swingline Lender, each Affiliate of any of the foregoing persons and each of
their respective partners, controlling persons, directors, officers, trustees,
employees and agents (each such person being called an “Indemnitee”) against, and to hold each
Indemnitee harmless from, all reasonable out of pocket costs and any and all
losses, claims, damages, liabilities, penalties, judgments, suits 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, delivery, performance,
administration or enforcement of the Loan Documents, (ii) any actual or
proposed use of the proceeds of the Loans or issuance of Letters of Credit,
(iii) any claim, litigation, investigation or proceeding relating to any of the
foregoing, whether or not any Indemnitee is a party thereto, or (iv) any actual
or alleged presence or Release or threatened Release of Hazardous Materials,
on, at, under or from any property owned, leased or operated by any Company, or
any Environmental Claim related in any way to any Company; provided that such indemnity shall not, as
to any Indemnitee, be available to the extent that such losses, claims,
damages, liabilities or related expenses are determined by a court of competent
jurisdiction by final and nonappealable judgment to have resulted from the
gross negligence or willful misconduct of such Indemnitee.


 


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(c)           The provisions of this Section
11.03 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 or Reimbursement
Obligations, the expiration of the Commitments, the expiration of any Letter of
Credit, 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 Agents, the Issuing Bank or any Lender. 
All amounts due under this Section 11.03 shall be payable on
written demand therefor accompanied by reasonable documentation with respect to
any reimbursement, indemnification or other amount requested.


 


(d)           To the extent that Borrower fails to
promptly pay any amount required to be paid by it to the Administrative Agent
and the Collateral Agent, the Issuing Bank or the Swingline Lender under paragraph
(a) or (b) of this Section, each Lender severally agrees to pay to the Agents,
the Issuing Bank or the Swingline Lender, 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 any of
the Agents, the Issuing Bank or the Swingline Lender 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 total Revolving Exposure, outstanding Term B
Loans and unused Commitments at the time.


 


SECTION 11.04. Successors and Assigns.


 


(a)           The provisions of this Agreement
shall be binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns permitted hereby (including any Affiliate of
the Issuing Bank that issues any Letter of Credit), except that Borrower may
not assign or otherwise transfer any of its rights or obligations hereunder
without the prior written consent of the Agents and each Lender (and any
attempted assignment or transfer by Borrower without such consent shall be null
and void).  Nothing in this Agreement, expressed
or implied, shall be construed to confer upon any person (other than the
parties hereto, their respective successors and assigns permitted hereby
(including any Affiliate of the Issuing Bank that issues any Letter of Credit) and,
to the extent expressly contemplated hereby, the Affiliates of each of the
Administrative Agent, the Issuing Bank and the Lenders) any legal or equitable
right, remedy or claim under or by reason of this Agreement.


 


(b)           Any Lender shall have the right at
any time to assign to one or more banks, insurance companies, investment
companies or funds or other institutions (other than Borrower or any Affiliate
or Subsidiary thereof) all or a portion of its rights and obligations under
this Agreement (including all or a portion of its Commitment and the Loans at
the time owing to it); provided
that (i) except in the case of an assignment to a Lender, an Affiliate of
a Lender or a Lender Affiliate, each of Borrower and the Administrative Agent
(and, in the case of an assignment of all or a portion of a Revolving
Commitment or any Lender’s obligations in respect of its LC Exposure or
Swingline Exposure, the Issuing Bank and the Swingline Lender) must give their
prior written consent to such assignment (which consent shall not be
unreasonably withheld or delayed), (ii) except in the case of an assignment to
a Lender, an Affiliate of a Lender or a Lender Affiliate, any assignment made
in connection with the syndication of the Commitment and Loans by the Arranger
or an assignment of the entire remaining amount of the assigning Lender’s
Commitment or Loans, 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 not be less than (x) in the case of Revolving
Loans, $2.5 million, and (y) in the case of Term B Commitments and Term B
Loans, $1.0 million unless each of Borrower and the Administrative Agent
otherwise consent, (iii) each partial assignment shall be made as an assignment
of a proportionate part of all the assigning Lender’s rights and obligations
under this


 


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Agreement, except that this clause (iii)
shall not be construed to prohibit the assignment of a proportionate part of
all the assigning Lender’s rights and obligations in respect of one Class of
Commitments or Loans, (iv) the parties to each assignment shall execute and
deliver to the Administrative Agent an Assignment and Acceptance in the form of
Exhibit B, together with a processing and recordation fee of
$3,500, and (v) the assignee, if it shall not be a Lender, shall deliver to the
Administrative Agent an Administrative Questionnaire; and provided, further, that
any consent of Borrower otherwise required under this paragraph shall not be
required if an Event of Default has occurred and is continuing or prior to the
date on which the Syndication Agent shall have notified Borrower that the
primary syndication of the Commitments has been completed (in which case the
Administrative Agent shall consult with Borrower).  Subject to acceptance and recording thereof
pursuant to paragraph (d) of this Section, from and after the effective date specified
in each Assignment and Acceptance 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 (provided that any liability of Borrower to
such assignee under Section 2.12, 2.13 or 2.15 shall be
limited to the amount, if any, that would have been payable thereunder by
Borrower in the absence of such assignment, except to the extent any such
amounts are attributable to a Change in Law occurring after the date of such
assignment), and 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 of the assigning Lender’s rights and obligations under this
Agreement, such Lender shall cease to be a party hereto but shall continue to
be entitled to the benefits of Sections 2.12, 2.13, 2.15
and 11.03).


 


(c)           The Administrative Agent, acting for
this purpose as an agent of Borrower, shall maintain at one of its offices 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 and LC Disbursements owing to, each Lender
pursuant to the terms hereof from time to time (the “Register”).  The entries
in the Register shall be conclusive in the absence of manifest error, and the
Administrative Agent, the Issuing Bank 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 Borrower, the Issuing Bank, the Collateral Agent, the
Swingline Lender and any Lender (with respect to its own interest only), at any
reasonable time and from time to time upon reasonable prior notice.


 


(d)           Upon its receipt of a duly completed
Assignment and Acceptance executed by an assigning Lender and an assignee, the
assignee’s completed Administrative Questionnaire (unless the assignee shall
already be a Lender hereunder), the processing and recordation fee referred to
in paragraph (b) of this Section and any written consent to such assignment
required by paragraph (b) of this Section, the Administrative Agent shall accept
such Assignment and Acceptance and record the information contained therein in
the Register.  No assignment shall be
effective for purposes of this Agreement unless it has been recorded in the
Register as provided in this paragraph.


 


(e)           Any Lender shall have the right at
any time, without the consent of Borrower, the Administrative Agent, the
Issuing Bank or the Swingline Lender, sell participations to one or more banks
or other entities (a “Participant”)
in all or a portion of such Lender’s rights and obligations under this
Agreement (including all or a portion of its Commitment and the Loans owing to
it); provided that (i) such
Lender’s obligations under this Agreement shall remain unchanged, (ii) such
Lender shall remain solely responsible to the other parties hereto for the
performance of such obligations and (iii) Borrower, the Administrative Agent,
the Issuing Bank and the other Lenders shall continue to deal solely and directly
with such Lender in connection with such Lender’s rights and obligations under
this Agreement.  Any agreement or
instrument pursuant to which a Lender sells such a participation shall provide
that such Lender shall retain the sole right to enforce the Loan Documents and
to approve any amendment,


 


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modification or waiver of any provision of
the Loan Documents; provided that
such agreement or instrument may provide that such Lender will not, without the
consent of the Participant, agree to any amendment, modification or waiver
described in clause (i), (ii) or (iii) of the first proviso to Section 11.02(b)
that affects such Participant.  Subject
to paragraph (f) of this Section, Borrower agrees that each Participant shall
be entitled to the benefits of Sections 2.12, 2.13 and 2.15
to the same extent as if it were a Lender and had acquired its interest by
assignment pursuant to paragraph (b) of this Section.  To the extent permitted by law, each
Participant also shall be entitled to the benefits of Section 11.08
as though it were a Lender; provided
that such Participant agrees to be subject to Section 2.14(c) as though
it were a Lender.  Each Lender shall,
acting for this purpose as an agent of Borrower, maintain at one of its offices
a register for the recordation of the names and addresses of its Participants,
and the amount and terms of its participations, provided
that no Lender shall be required to disclose or share the information contained
in such register with Borrower or any other party, except as required by applicable
law.


 


(f)            A Participant shall not be entitled
to receive any greater payment under Section 2.12, 2.13 or 2.15
than the applicable Lender would have been entitled to receive with respect to
the participation sold to such Participant, unless the sale of the
participation to such Participant is made with the prior written consent of Borrower
(which consent shall not be unreasonably withheld or delayed).  A Participant that would be a Foreign Lender
if it were a Lender shall not be entitled to the benefits of Section 2.15
unless Borrower is notified of the participation sold to such Participant and
such Participant agrees, for the benefit of Borrower, to comply with Sections
2.15(e) and (f) as though it were a Lender.


 


(g)           Any Lender may at any time pledge or
assign a security interest in all or any portion of its rights under this
Agreement to secure obligations of such Lender, including any pledge or
assignment to secure obligations to a Federal Reserve Bank, and this Section
shall not apply to any such pledge or assignment of a security interest; provided that no such pledge or assignment
of a security interest shall release a Lender from any of its obligations
hereunder or substitute any such pledgee or assignee for such Lender as a party
hereto.  In the case of any Lender that
is a fund that invests in bank loans, such Lender may, without the consent of Borrower
or the Administrative Agent, collaterally assign or pledge all or any portion
of its rights under this Agreement, including the Loans and Notes or any other
instrument evidencing its rights as a Lender under this Agreement, to any
holder of, trustee for, or any other representative of holders of, obligations
owed or securities issued, by such fund, as security for such obligations or
securities.


 


SECTION 11.05. Survival of Agreement.  All covenants, agreements, representations
and warranties made by the Loan Parties in the Loan Documents and in the certificates
or other instruments delivered in connection with or pursuant to this Agreement
or any other Loan Document shall be considered to have been relied upon by the
other parties hereto and shall survive the execution and delivery of the Loan
Documents and the making of any Loans and issuance of any Letters of Credit,
regardless of any investigation made by any such other party or on its behalf
and notwithstanding that the Agents, the Issuing Bank or any Lender may have
had notice or knowledge of any Default or incorrect representation or warranty
at the time any credit is extended hereunder, 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 is outstanding and unpaid
or any Letter of Credit is outstanding and so long as the Commitments have not
expired or terminated.  The provisions of
Sections 2.12, 2.13,  2.14, 2.15 and 11.03
and Article X shall survive and remain in full force and effect
regardless of the consummation of the transactions contemplated hereby, the
repayment of the Loans, the payment of the Reimbursement Obligations, the
expiration or termination of the Letters of Credit and the Commitments or the
termination of this Agreement or any provision hereof.


 


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SECTION 11.06. Counterparts; Integration; Effectiveness.  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.  This
Agreement, the other Loan Documents, the Fee Letter and the Engagement Letter
constitute the entire contract among the parties relating to the subject matter
hereof and supersede any and all previous agreements and understandings, oral
or written, relating to the subject matter hereof, including the Original
Credit Agreement, except to the extent set forth in Section 11.05 of the
Original Credit Agreement.  Except as provided
in Section 4.04, this Agreement shall become effective when it shall
have been executed by the Administrative Agent and when the Administrative
Agent shall have received counterparts hereof which, when taken together, bear
the signatures of each of the other parties hereto, and thereafter shall be
binding upon and inure to the benefit of the parties hereto and their respective
successors and assigns.  Borrower, the Subsidiary
Guarantors, the Agents and the Lenders agree that (a) all obligations under the
Original Credit Agreement, as amended and restated hereby, shall continue to
exist under and be evidenced by this Agreement and the other Loan Documents and
shall constitute Obligations except to the extent prepaid and exchanged in
accordance with Section 2.23 and (b) except as expressly stated herein
or amended, the other Loan Documents are ratified and confirmed as remaining
unmodified and in full force and effect with respect to all Obligations.  Delivery of an executed counterpart of a
signature page of this Agreement by telecopy shall be effective as delivery of
a manually executed counterpart of this Agreement.  Notwithstanding the foregoing, each Lender by
signing a Confidential Lender Authorization with the Administrative Agent shall
be deemed to have consented to the Administrative Agent signing this Agreement
on its behalf pursuant to the provisions thereof and, effective upon the
Administrative Agent signing a counterpart of such Confidential Lender
Authorization, shall be further deemed in this Agreement and the other Loan
Documents to have been a signatory hereto. 
Each Lender signatory to a Confidential Lender Authorization agrees that
such Lender shall not be entitled to receive a copy of any other Lender’s
Confidential Lender Authorization.


 


SECTION 11.07. Severability.  Any provision of this Agreement held to be
invalid, illegal or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such invalidity, illegality or
unenforceability without affecting the validity, legality and enforceability of
the remaining provisions hereof; and the invalidity of a particular provision
in a particular jurisdiction shall not invalidate such provision in any other
jurisdiction.


 


SECTION 11.08. Right of
Setoff.  If an
Event of Default shall have occurred and be continuing, each Lender and each of
its Affiliates are hereby authorized at any time and from time to time, to the
fullest extent permitted 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 obligations at any time owing by such Lender or Affiliate to or for the
credit or the account of Borrower against any of and all the obligations of Borrower
now or hereafter existing under this Agreement held by such Lender, irrespective
of whether or not such Lender shall have made any demand under this Agreement
and although such obligations may be unmatured. 
The rights of each Lender under this Section are in addition to other
rights and remedies (including other rights of setoff) which such Lender may
have.


 


SECTION 11.09. Governing Law; Jurisdiction; Consent to Service of Process.


 


(a)           This Agreement shall be construed in
accordance with and governed by the law of the State of New York, without
regard to conflicts of law principles that would require the application of the
laws of another jurisdiction.


 


(b)           Each Loan Party hereby irrevocably
and unconditionally submits, for itself and its property, to the nonexclusive
jurisdiction of the Supreme Court of the State of New York sitting in New York


 


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County and of the United States District
Court of the Southern District of New York, and any appellate court from any
thereof, in any action or proceeding arising out of or relating to any Loan
Document, 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 or any other Loan Document shall affect any right that the
Administrative Agent, the Issuing Bank or any Lender may otherwise have to
bring any action or proceeding relating to this Agreement or any other Loan
Document against any Loan Party or its properties in the courts of any jurisdiction.


 


(c)           Each Loan Party 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 any other Loan Document in any court referred to in paragraph
(b) of this Section 11.09.  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.


 


Each party to
this Agreement irrevocably consents to service of process in the manner
provided for notices in Section 11.01. 
Nothing in this Agreement or any other Loan Document will affect the
right of any party to this Agreement to serve process in any other manner
permitted by applicable law.


 


SECTION 11.10. 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 ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING
TO THIS AGREEMENT, ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED
HEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY).  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 BY, AMONG OTHER
THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.


 


SECTION 11.11. Headings.  Article and Section headings and the Table of
Contents used herein are for convenience of reference only, are not part of
this Agreement and shall not affect the construction of, or be taken into
consideration in interpreting, this Agreement.


 


SECTION 11.12. Confidentiality.  Each of the Administrative Agent, the Issuing
Bank 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
Lender Affiliates’ directors, officers, 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
pursuant to the terms hereof), (b) to the extent requested by any regulatory
authority or self-regulatory body, (c) to the extent required by applicable
laws or regulations or by any subpoena or similar legal process, (d) to any
other party to this Agreement, (e) in connection with the exercise of any
remedies hereunder or any suit, action or proceeding relating to this Agreement
or any other Loan Document or the enforcement of rights hereunder or
thereunder, (f) subject to an agreement containing provisions substantially the
same as those of this Section 11.12, to (i) any assignee of or


 


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Participant in, or any prospective assignee of or Participant in, any
of its rights or obligations under this Agreement or (ii) any actual or prospective
counterparty (or its advisors) to any swap or derivative transaction relating
to Borrower and its obligations, (g) with the consent of Borrower or (h) to the
extent such Information (i) is publicly available at the time of disclosure or
becomes publicly available other than as a result of a breach of this Section
11.12 or (ii) becomes available to the Administrative Agent, the Issuing
Bank or any Lender on a nonconfidential basis from a source other than Borrower
or any Subsidiary.  For the purposes of
this Section, “Information” means
all information received from Borrower or any Subsidiary relating to Borrower
or any Subsidiary or its business that is clearly identified at the time of
delivery as confidential, other than any such information that is available to
the Administrative Agent, the Issuing Bank or any Lender on a nonconfidential
basis prior to disclosure by Borrower or any Subsidiary.  Any person required to maintain the
confidentiality of Information as provided in this Section 11.12 shall
be considered to have complied with its obligation to do so if such person has
exercised the same degree of care to maintain the confidentiality of such
Information as such person would accord to its own confidential information.


 


SECTION 11.13. 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 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 but were not payable as a result of the operation of this
Section shall be cumulated and the interest and Charges payable to such Lender
in respect of other Loans 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.


 


SECTION 11.14. Lender Addendum.  Each Original Lender to become a party to
this Agreement on the Closing Date shall do so by delivering to the
Administrative Agent a Lender Addendum duly executed by such Original Lender, Borrower
and the Administrative Agent.


 


SECTION 11.15. Integration.  This Agreement and the other Loan Documents
constitute the entire contract among the parties relating to the subject matter
hereof and supersede any and all previous agreements and understandings, oral
or written, relating to the subject matter hereof.  Borrower, the Subsidiary Guarantors, the
Agents and the Lenders agree that (a) all obligations under the Original Credit
Agreement, as amended and restated hereby, shall continue to exist under and be
evidenced by this Agreement and the other Loan Documents and shall constitute
Obligations (except to the extent prepaid and exchanged in accordance with Section 2.23)
and (b) except as expressly stated herein or amended, the other Loan Documents
are ratified and confirmed as remaining unmodified and in full force and effect
with respect to all Obligations.


 


SECTION 11.16. USA PATRIOT Act Notice.  Each Lender that is subject to the Act (as
hereinafter defined) and the Administrative Agent (for itself and not on behalf
of any Lender) hereby notifies Borrower that pursuant to the requirements of
the USA PATRIOT Act (Title III of Pub. L. 107-56 (signed into law
October 26, 2001)) (the “Act”), it is required to obtain, verify and
record information that identifies Borrower, which information includes the
name, address and tax identification number of Borrower and other information
regarding Borrower that will allow such Lender or the Administrative Agent, as
applicable, to identify Borrower in accordance with the Act.  This notice is given in accordance with the
requirements of the Act and is effective as to the Lenders and the
Administrative Agent.


 


102





















 


[Signature Pages Follow]


 


103





















 


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.


 


	
   

  	
  BASIC ENERGY SERVICES, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Kenneth V. Huseman

  
	
   

  	
   

  	
  Name:

  	
  Kenneth V. Huseman

  
	
   

  	
   

  	
  Title:

  	
  President

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  FIRST ENERGY SERVICES COMPANY,

  
	
   

  	
  as a Subsidiary Guarantor

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Kenneth V. Huseman

  
	
   

  	
   

  	
  Name:

  	
  Kenneth V. Huseman

  
	
   

  	
   

  	
  Title:

  	
  President

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  H. B. & R., INC., as a
  Subsidiary Guarantor

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Kenneth V. Huseman

  
	
   

  	
   

  	
  Name:

  	
  Kenneth V. Huseman

  
	
   

  	
   

  	
  Title:

  	
  President

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  FESCO ALASKA, INC., as a Subsidiary Guarantor

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Kenneth V. Huseman

  
	
   

  	
   

  	
  Name:

  	
  Kenneth V. Huseman

  
	
   

  	
   

  	
  Title:

  	
  President

  
	
   

  	
   

  	
   

  
	
   

  	
  BASIC ENERGY SERVICES, L.P.,

  
	
   

  	
  as a Subsidiary Guarantor

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  BASIC ENERGY SERVICES GP, LLC,

  
	
   

  	
   

  	
  its General Partner

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Kenneth V. Huseman

  
	
   

  	
   

  	
  Name:

  	
  Kenneth V. Huseman

  
	
   

  	
   

  	
  Title:

  	
  President

  
					



 


1





















 


	
   

  	
  BASIC ENERGY SERVICES GP, LLC,

  
	
   

  	
  as a Subsidiary Guarantor

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Kenneth V. Huseman

  
	
   

  	
   

  	
  Name:

  	
  Kenneth V. Huseman

  
	
   

  	
   

  	
  Title:

  	
  President

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  BASIC ENERGY SERVICES LP, LLC,

  
	
   

  	
  as a Subsidiary Guarantor

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Scott Kinnamon

  
	
   

  	
   

  	
  Name:

  	
  Scott Kinnamon

  
	
   

  	
   

  	
  Title:

  	
  President

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  BASIC ESA, INC., as a Subsidiary Guarantor

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Kenneth V. Huseman

  
	
   

  	
   

  	
  Name:

  	
  Kenneth V. Huseman

  
	
   

  	
   

  	
  Title:

  	
  President

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  WESTERN OIL WELL SERVICE CO.,

  
	
   

  	
  as a Subsidiary Guarantor

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Kenneth V. Huseman

  
	
   

  	
   

  	
  Name:

  	
  Kenneth V. Huseman

  
	
   

  	
   

  	
  Title:

  	
  President

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  BASIC MARINE SERVICES, INC.,

  
	
   

  	
  as a Subsidiary Guarantor

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Kenneth V. Huseman

  
	
   

  	
   

  	
  Name:

  	
  Kenneth V. Huseman

  
	
   

  	
   

  	
  Title:

  	
  President

  



 


2





















 


	
   

  	
  ENERGY AIR DRILLING SERVICE CO.,

  
	
   

  	
  as a Subsidiary Guarantor

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Kenneth V. Huseman

  
	
   

  	
   

  	
  Name:

  	
  Kenneth V. Huseman

  
	
   

  	
   

  	
  Title:

  	
  President

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  R&R HOT OIL SERVICE INC.,

  
	
   

  	
  as a Subsidiary Guarantor

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Kenneth V. Huseman

  
	
   

  	
   

  	
  Name:

  	
  Kenneth V. Huseman

  
	
   

  	
   

  	
  Title:

  	
  President

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  OILWELL
  FRACTURING SERVICES, INC.,

  
	
   

  	
  as a Subsidiary Guarantor

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Kenneth V. Huseman

  
	
   

  	
   

  	
  Name:

  	
  Kenneth V. Huseman

  
	
   

  	
   

  	
  Title:

  	
  President

  



 


3





















 


	
   

  	
  UBS AG, STAMFORD BRANCH, as Issuing Bank,

  Administrative Agent and Collateral Agent

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Irja R. Otsa

  
	
   

  	
   

  	
  Name:

  	
  Irja R. Otsa

  
	
   

  	
   

  	
  Title:

  	
  Associate Director, Banking

  Products Services, US

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Christopher M. Aitkin

  
	
   

  	
   

  	
  Name:

  	
  Christopher M. Aitkin

  
	
   

  	
   

  	
  Title:

  	
  Associate Director, Banking

  Products Services, US

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  UBS LOAN FINANCE LLC, as a Lender and Swingline

  Lender

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Irja R. Otsa

  
	
   

  	
   

  	
  Name:

  	
  Irja R. Otsa

  
	
   

  	
   

  	
  Title:

  	
  Associate Director, Banking

  Products Services, US

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Christopher M. Aitkin

  
	
   

  	
   

  	
  Name:

  	
  Christopher M. Aitkin

  
	
   

  	
   

  	
  Title:

  	
  Associate Director, Banking

  Products Services, US

  



 


4





















 


	
   

  	
  BANK OF AMERICA, N.A., as Syndication Agent

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ David A. Batson

  
	
   

  	
   

  	
  Name:

  	
  David A. Batson

  
	
   

  	
   

  	
  Title:

  	
  Vice President

  



 


5





















 


	
   

  	
  HIBERNIA NATIONAL BANK, as a Documentation

  Agent

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Stephen H. Birnbaum

  
	
   

  	
   

  	
  Name:

  	
  Stephen H. Birnbaum

  
	
   

  	
   

  	
  Title:

  	
  Vice President

  



 


6





















 


	
   

  	
  BNP PARIBAS, as a Documentation Agent

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Mark A. Cox

  
	
   

  	
   

  	
  Name:

  	
  Mark A. Cox

  
	
   

  	
   

  	
  Title:

  	
  Director

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Greg Smothers

  
	
   

  	
   

  	
  Name:

  	
  Greg Smothers

  
	
   

  	
   

  	
  Title:

  	
  Vice President

  



 


 


7





















 


Annex
I


 


Applicable
Margin


 


	
  Applicable

  	
   

  	
  Revolving Loans

  	
   

  	
  Term B Loans

  	
   

  	
   

  	
   

  
	
  Leverage
  Ratio

  	
   

  	
  Eurodollar

  	
   

  	
  ABR

  	
   

  	
  Eurodollar

  	
   

  	
  ABR

  	
   

  	
  Applicable Fee

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Level I < 1.0:1.0

  	
   

  	
  1.5

  	
  %

  	
  0.50

  	
  %

  	
  2.00

  	
  %

  	
  1.00

  	
  %

  	
  0.375

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Level II < 2.0:1.0 but > 1.0:1.0

  	
   

  	
  1.75

  	
  %

  	
  0.75

  	
  %

  	
  2.00

  	
  %

  	
  1.00

  	
  %

  	
  0.375

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Level III < 2.75:1.0 but > 2.0:1.0

  	
   

  	
  2.00

  	
  %

  	
  1.00

  	
  %

  	
  2.00

  	
  %

  	
  1.00

  	
  %

  	
  0.375

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Level IV > 2.75:1.0

  	
   

  	
  2.25

  	
  %

  	
  1.25

  	
  %

  	
  2.00

  	
  %

  	
  1.00

  	
  %

  	
  0.50

  	
  %

  



 


Each change in
the Applicable Margin or Applicable Fee resulting from a change in the Leverage
Ratio shall be effective with respect to all Loans and Letters of Credit
outstanding on and after the date of delivery to the Administrative Agent of
the financial statements and certificates required by Section 5.01(a)
or (b) and Section 5.01(d), respectively, indicating such change
until the date immediately preceding the next date of delivery of such
financial statements and certificates indicating another such change.


 


Notwithstanding
the foregoing:


 


(a) from the Third Amendment
and Restatement Effective Date to the date of delivery to the Administrative
Agent of the financial statements and certificate required by Section 5.01(a)
and Section 5.01(d) for the fiscal year ending December 31, 2005, (i) the Applicable
Margin for Revolving Loans shall be 1.75% with respect to Eurodollar Revolving
Loans and 0.75% with respect to ABR Revolving Loans and (ii) the Applicable Fee
shall be 0.50%; and


 


(b) the Leverage Ratio shall be
deemed to be in Level IV at any time (i)during which the Borrower has failed to
deliver the financial statements and certificates required by Section
5.01(a) or (b) and Section 5.01(d), respectively, and
(ii) during the existence of an Event of Default.


 


I-1





















 


Annex
II


 


Amortization
Table


 


	
  Payment
  Date

  	
   

  	
  Installment Amount

  	
   

  
	
  March 31, 2006

  	
   

  	
  $

  	
  250,000.00

  	
   

  
	
  June 30, 2006

  	
   

  	
  $

  	
  250,000.00

  	
   

  
	
  September 30, 2006

  	
   

  	
  $

  	
  250,000.00

  	
   

  
	
  December 31, 2006

  	
   

  	
  $

  	
  250,000.00

  	
   

  
	
  March 31, 2007

  	
   

  	
  $

  	
  250,000.00

  	
   

  
	
  June 30, 2007

  	
   

  	
  $

  	
  250,000.00

  	
   

  
	
  September 30, 2007

  	
   

  	
  $

  	
  250,000.00

  	
   

  
	
  December 31, 2007

  	
   

  	
  $

  	
  250,000.00

  	
   

  
	
  March 31, 2008

  	
   

  	
  $

  	
  250,000.00

  	
   

  
	
  June 30, 2008

  	
   

  	
  $

  	
  250,000.00

  	
   

  
	
  September 30, 2008

  	
   

  	
  $

  	
  250,000.00

  	
   

  
	
  December 31, 2008

  	
   

  	
  $

  	
  250,000.00

  	
   

  
	
  March 31, 2009

  	
   

  	
  $

  	
  250,000.00

  	
   

  
	
  June 30, 2009

  	
   

  	
  $

  	
  250,000.00

  	
   

  
	
  September 30, 2009

  	
   

  	
  $

  	
  250,000.00

  	
   

  
	
  December 31, 2009

  	
   

  	
  $

  	
  250,000.00

  	
   

  
	
  March 31, 2010

  	
   

  	
  $

  	
  250,000.00

  	
   

  
	
  June 30, 2010

  	
   

  	
  $

  	
  250,000.00

  	
   

  
	
  September 30, 2010

  	
   

  	
  $

  	
  250,000.00

  	
   

  
	
  December 31, 2010

  	
   

  	
  $

  	
  250,000.00

  	
   

  
	
  March 31, 2011

  	
   

  	
  $

  	
  250,000.00

  	
   

  
	
  June 30, 2011

  	
   

  	
  $

  	
  21,187,500.00

  	
   

  
	
  September 30, 2011

  	
   

  	
  $

  	
  21,187,500.00

  	
   

  
	
  Term B Maturity Date

  	
   

  	
  $

  	
  42,375,000.00

  	
   

  



 


II-1