exv10wxjy



 






EXHIBIT 10(j)




FIRST AMENDMENT TO CREDIT AGREEMENT




     THIS FIRST AMENDMENT TO FIVE-YEAR REVOLVING CREDIT AGREEMENT (this “Amendment”), dated
as of July 11, 2005, is entered into among POLARIS INDUSTRIES INC., a Minnesota corporation (the
“Borrower”), certain of the Subsidiaries of the Borrower (individually a
“Guarantor” and collectively the “Guarantors”), the Lenders and BANK OF AMERICA,
N.A., as Administrative Agent. Terms used but not otherwise defined herein shall have the meanings
provided in the Credit Agreement described below.



W I T N E S S E T H




     WHEREAS, the Borrower, the Guarantors, the Lenders and the Administrative Agent entered into
that certain Five-Year Revolving Credit Agreement dated as of June 25, 2004 (the “Existing
Credit Agreement”);



     WHEREAS, the Borrower has requested that the Required Lenders agree to amend certain
provisions of the Credit Agreement; and



     WHEREAS, the Required Lenders have agreed to such modifications on the terms and conditions
set forth herein.



     NOW, THEREFORE, in consideration of the agreements hereinafter set forth, and for other good
and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the parties
hereto agree as follows:



PART 1

DEFINITIONS




     SUBPART 1.1 Certain Definitions. Unless otherwise defined herein or the context
otherwise requires, the following terms used in this Amendment, including its preamble and
recitals, have the following meanings:




          “Amended Credit Agreement” means the Existing Credit Agreement as amended
hereby.




          “Amendment No. 1 Effective Date” is defined in Subpart 3.1.



     SUBPART 1.2 Other Definitions. Unless otherwise defined herein or the context
otherwise requires, terms used in this Amendment, including its preamble and recitals, have the
meanings provided in the Existing Credit Agreement.



 









 





PART 2

AMENDMENTS TO EXISTING CREDIT AGREEMENT




     Subject to the satisfaction of the conditions precedent set forth in Part 3 hereof, the
Required Lenders hereby agree that from and after the Amendment No. 1 Effective Date (as defined
below), (i) the Existing Credit Agreement is amended in its entirety to read in the form of such
Credit Agreement attached hereto as Exhibit A to this Amendment, (ii) Exhibit
2.1(b) of the Existing Credit Agreement is amended in its entirety to read in the form of such
Exhibit 2.1(b) attached hereto as Exhibit B to this Amendment, (iii) Exhibit
2.3 of the Existing Credit Agreement is amended in its entirety to read in the form of such
Exhibit 2.3 attached hereto as Exhibit C to this Amendment and (iv) a new
Schedule 1.1(c) is hereby added to the Existing Credit Agreement to read in the form of
such Schedule 1.1(c) attached hereto as Exhibit D.



PART 3

CONDITIONS TO EFFECTIVENESS




     SUBPART 3.1 Amendment No. 1 Effective Date. This Amendment shall be and become
effective as of the date hereof (the “Amendment No. 1 Effective Date”) when all of the
conditions set forth in this Part 3 shall have been satisfied, and thereafter this
Amendment shall be known, and may be referred to, as the “Amendment”.



     SUBPART 3.2 Execution of Counterparts of Amendment. The Administrative Agent shall
have received counterparts of this Amendment, which collectively shall have been duly executed on
behalf of each of the Borrower, the Required Lenders and the Administrative Agent.



PART 4

MISCELLANEOUS




     SUBPART 4.1 Representations and Warranties. The Borrower hereby represents and
warrants to the Administrative Agent and the Lenders that, after giving effect to this Amendment,
(a) no Default or Event of Default exists under the Credit Agreement and (b) the representations
and warranties set forth in Section 6 of the Existing Credit Agreement are, subject to the
limitations set forth therein, true and correct as of the date hereof (except for those which
expressly relate to an earlier date).



     SUBPART 4.2 Cross-References. References in this Amendment to any Part or Subpart
are, unless otherwise specified, to such Part or Subpart of this Amendment.



     SUBPART 4.3 Instrument Pursuant to Existing Credit Agreement. This Amendment is
executed pursuant to the Existing Credit Agreement and shall (unless otherwise expressly indicated
therein) be construed, administered and applied in accordance with the terms and provisions of the
Existing Credit Agreement.



     SUBPART 4.4 References in Other Credit Documents. At such time as this Amendment
shall become effective pursuant to the terms of Subpart 3.1, all references to the “Credit
Agreement” shall be deemed to refer to the Credit Agreement as amended by this Amendment.



 









 





     SUBPART 4.5 Counterparts/Telecopy. This Amendment may be executed by the parties
hereto in several counterparts, each of which shall be deemed to be an original and all of which
shall constitute together but one and the same agreement. Delivery of executed counterparts of the
Amendment by telecopy shall be effective as an original and shall constitute a representation that
an original shall be delivered.



     SUBPART 4.6 Governing Law. THIS AMENDMENT AND THE OTHER CREDIT DOCUMENTS AND THE
RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER AND THEREUNDER SHALL BE GOVERNED BY AND CONSTRUED
AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.



     SUBPART 4.7 Successors and Assigns. This Amendment shall be binding upon and inure
to the benefit of the parties hereto and their respective successors and assigns.



     SUBPART 4.8 General. Except as amended hereby, the Existing Credit Agreement and all
other credit documents shall continue in full force and effect.



[Remainder of Page Intentionally Left Blank]





 









 








     IN WITNESS WHEREOF, the parties hereto have executed this Amendment to the Credit Agreement as
of the date first above written.



	 	 	 	 	 
	BORROWER:
	 	 	 	 
	 	 	POLARIS INDUSTRIES
INC.,
	 	 	a Minnesota corporation
 
	 

	 	By:
	 	 /s/ Michael W. Malone
	 
	 	 	 

	 	 	Name: Michael W. Malone
	 	 	Title: Chief Financial Officer, Secretary and Vice President-Finance






 









 






	 	 	 	 	 
	GUARANTORS:	 	POLARIS REAL ESTATE CORPORATION OF
	 	 	IOWA, INC., a Delaware corporation
	 
	 	 	 	 
	 	 	POLARIS REAL ESTATE CORPORATION,
	 	 	a Delaware corporation
	 
	 	 	 	 
	 	 	POLARIS ACCEPTANCE INC.,
	 	 	a Minnesota corporation
	 
	 	 	 	 
	 	 	POLARIS SALES INC., a Minnesota corporation
	 
	 	 	 	 
	 	 	POLARIS DIRECT INC., a Minnesota corporation
	 
	 	 	 	 
	 	 	POLARIS INDUSTRIES INC., a Delaware corporation
	 
	 	 	 	 
	 	 	POLARIS INDUSTRIES MANUFACTURING LLC,

a Minnesota limited liability company
	 
	 	 	 	 
	 

	 	By:
	 	/s/ Michael W. Malone
	 

	 	 

	 

	 	Name:
	 	Michael W. Malone
	 

	 	Title:
	 	 Chief Financial Officer, Secretary and
	 

	 	 	 	Vice President-Finance of each of the foregoing entities






 









 






	 	 	 	 	 
	ADMINISTRATIVE AGENT:	 	BANK OF AMERICA, N.A.,


as Administrative Agent
	 
	 	 	 	 
	 

	 	By:
	 	/s/ Paul Folino
	 

	 	 

	 

	 	Name:
	 	Paul Folino
	 

	 	Title:
	 	Assistant Vice President






 









 






	 	 	 	 	 
	LENDERS:	 	BANK OF AMERICA, N.A., individually in its capacity
as a Lender and in its capacity as Issuing Lender
	 
	 	 	 	 
	 

	 	By:
	 	/s/ Charles R. Dickerson
	 

	 	 	 

	 

	 	Name:
	 	Charles R. Dickerson
	 

	 	Title:
	 	Senior Vice President






 









 






	 	 	 	 	 
	 	 	U.S. BANK NATIONAL ASSOCIATION
	 
	 	 	 	 
	 

	 	By:
	 	/s/ Karen E. Weathers
	 

	 	 

	 

	 	Name:
	 	Karen E. Weathers
	 

	 	Title:
	 	Vice President






 









 






	 	 	 	 	 
	 	 	MIZUHO CORPORATE BANK, LTD.
	 
	 	 	 	 
	 

	 	By:
	 	/s/ Robert Gallagher
	 

	 	 

	 

	 	Name:
	 	Robert Gallagher
	 

	 	Title:
	 	Senior Vice President & Team Leader






 









 






	 	 	 	 	 
	 	 	COMERICA BANK
	 
	 

	 	By:
	 	/s/ Timothy O’Rourke
	 

	 	 

	 

	 	Name:
	 	Timothy O’Rourke
	 

	 	Title:
	 	Vice President






 









 






	 	 	 	 	 
	 	 	BARCLAYS BANK PLC
	 
	 	 	 	 
	 

	 	By:
	 	/s/ David Barton
	 

	 	 

	 

	 	Name:
	 	David Barton
	 

	 	Title:
	 	Associate Director






 









 






	 	 	 	 	 
	 	 	WELLS FARGO BANK, NATIONAL ASSOCIATION
	 
	 	 	 	 
	 

	 	By:
	 	/s/ Mark H. Halldorson
	 

	 	 

	 

	 	Name:
	 	Mark H. Halldorson
	 

	 	Title:
	 	Vice President
	 
	 	 	 	 
	 

	 	By:
	 	/s/ Allison S. Gelfman
	 

	 	 

	 

	 	Name:
	 	Allison S. Gelfman
	 

	 	Title:
	 	Vice President
	 

	 	 	 	Wells Fargo Bank, National Association






 









 






	 	 	 	 	 
	 	 	THE BANK OF TOKYO-MITSUBISHI, LTD.,

CHICAGO BRANCH
	 
	 	 	 	 
	 

	 	By:
	 	/s/ Tsuguyuki Umene
	 

	 	 

	 

	 	Name:
	 	Tsuguyuki Umene
	 

	 	Title:
	 	Deputy General Manager






 









 






	 	 	 	 	 
	 	 	ROYAL BANK OF CANADA
	 
	 	 	 	 
	 

	 	By:
	 	/s/ Gordon MacArthur
	 

	 	 

	 

	 	Name:
	 	Gordon MacArthur
	 

	 	Title:
	 	Authorized Signatory






 









 






EXHIBIT A




CREDIT AGREEMENT




[attached]





 










 






EXECUTION COPY




Published CUSIP Number: 73107FAA3




FIVE-YEAR REVOLVING CREDIT AGREEMENT




among



POLARIS INDUSTRIES INC.

as Borrower,



AND



CERTAIN SUBSIDIARIES OF THE BORROWER

as Guarantors,



AND



THE LENDERS IDENTIFIED HEREIN,



AND



BANK OF AMERICA, N.A.,

as Administrative Agent and Issuing Lender



AND



U.S. BANK N.A.



as Syndication Agent



AND



THE BANK OF TOKYO-MITSUBISHI, LTD., CHICAGO BRANCH



as Documentation Agent



DATED AS OF JUNE 25, 2004



BANC OF AMERICA SECURITIES LLC

as Sole Book Manager and Sole Lead Arranger




 









 

















TABLE OF CONTENTS




	 	 	 	 	 
	SECTION 1 DEFINITIONS AND ACCOUNTING TERMS
	 	 	1	 
	1.1 Definitions
	 	 	1	 
	1.2 Computation of Time Periods and Other Definitional Provisions
	 	 	25	 
	1.3 Accounting Terms
	 	 	25	 
	1.4 Time
	 	 	26	 
	1.5 References to Agreements and Requirement of Laws
	 	 	26	 
	1.6 Letter of Credit Amounts
	 	 	26	 
	1.7 Exchange Rates; Currency Equivalents
	 	 	26	 
	1.8 Additional Alternative Currencies
	 	 	27	 
	SECTION 2 CREDIT FACILITIES
	 	 	28	 
	2.1 Loans
	 	 	28	 
	2.2 Letter of Credit Subfacility
	 	 	29	 
	2.3 Continuations and Conversions
	 	 	39	 
	2.4 Minimum Amounts
	 	 	40	 
	SECTION 3 GENERAL PROVISIONS APPLICABLE TO LOANS AND LETTERS OF CREDIT
	 	 	40	 
	3.1 Interest
	 	 	40	 
	3.2 Place and Manner of Payments
	 	 	41	 
	3.3 Prepayments
	 	 	43	 
	3.4 Fees
	 	 	44	 
	3.5 Payment in full at Maturity
	 	 	46	 
	3.6 Computations of Interest and Fees
	 	 	46	 
	3.7 Pro Rata Treatment
	 	 	47	 
	3.8 Sharing of Payments
	 	 	48	 
	3.9 Capital Adequacy
	 	 	48	 
	3.10 Inability To Determine Interest Rate
	 	 	49	 
	3.11 Illegality
	 	 	50	 
	3.12 Requirements of Law
	 	 	50	 
	3.13 Taxes
	 	 	51	 
	3.14 Compensation
	 	 	54	 
	3.15 Determination and Survival of Provisions
	 	 	55	 
	SECTION 4 GUARANTY
	 	 	56	 
	4.1 Guaranty of Payment
	 	 	56	 
	4.2 Obligations Unconditional
	 	 	56	 
	4.3 Modifications
	 	 	57	 
	4.4 Waiver of Rights
	 	 	57	 
	4.5 Reinstatement
	 	 	58	 
	4.6 Remedies
	 	 	58	 
	4.7 Limitation of Guaranty
	 	 	58	 
	4.8 Rights of Contribution
	 	 	59	 
	SECTION 5 CONDITIONS PRECEDENT
	 	 	59	 
	5.1 Closing Conditions
	 	 	59	 





 
i









 






	 	 	 	 	 
	5.2 Conditions to All Extensions of Credit
	 	 	61	 
	SECTION 6 REPRESENTATIONS AND WARRANTIES
	 	 	62	 
	6.1 Organization and Good Standing
	 	 	62	 
	6.2 Due Authorization
	 	 	62	 
	6.3 Enforceable Obligations
	 	 	63	 
	6.4 No Conflicts
	 	 	63	 
	6.5 Consents
	 	 	63	 
	6.6 Financial Condition
	 	 	63	 
	6.7 No Material Change
	 	 	64	 
	6.8 Disclosure
	 	 	64	 
	6.9 No Default
	 	 	64	 
	6.10 Litigation
	 	 	64	 
	6.11 Taxes
	 	 	64	 
	6.12 Compliance with Law
	 	 	65	 
	6.13 Licenses, etc
	 	 	65	 
	6.14 Title to Properties
	 	 	65	 
	6.15 Insurance
	 	 	65	 
	6.16 Use of Proceeds
	 	 	65	 
	6.17 Government Regulation
	 	 	65	 
	6.18 No Burdensome Restrictions
	 	 	66	 
	6.19 ERISA
	 	 	66	 
	6.20 Environmental Matters
	 	 	68	 
	6.21 Intellectual Property
	 	 	69	 
	6.22 Subsidiaries
	 	 	69	 
	6.23 Solvency
	 	 	70	 
	6.24 Indebtedness
	 	 	70	 
	6.25 Investments; Liens
	 	 	70	 
	6.26 Force Majeure
	 	 	70	 
	SECTION 7 AFFIRMATIVE COVENANTS
	 	 	70	 
	7.1 Information Covenants
	 	 	70	 
	7.2 Financial Covenants
	 	 	74	 
	7.3 Preservation of Existence and Franchises
	 	 	74	 
	7.4 Books and Records
	 	 	74	 
	7.5 Compliance with Law
	 	 	74	 
	7.6 Payment of Taxes and Other Indebtedness
	 	 	74	 
	7.7 Insurance
	 	 	75	 
	7.8 Maintenance of Property
	 	 	75	 
	7.9 Performance of Obligations
	 	 	75	 
	7.10 Use of Proceeds
	 	 	75	 
	7.11 Audits/Inspections
	 	 	75	 
	7.12 Additional Credit Parties
	 	 	76	 
	SECTION 8 NEGATIVE COVENANTS
	 	 	77	 
	8.1 Indebtedness
	 	 	77	 
	8.2 Guaranty Obligations
	 	 	78	 
	8.3 Liens
	 	 	79	 






ii









 






	 	 	 	 	 
	8.4 Nature of Business
	 	 	79	 
	8.5 Consolidation and Merger
	 	 	79	 
	8.6 Sale or Lease of Assets
	 	 	80	 
	8.7 Sale Leasebacks
	 	 	80	 
	8.8 Investments
	 	 	80	 
	8.9 Foreign Subsidiaries
	 	 	81	 
	8.10 Transactions with Affiliates
	 	 	81	 
	8.11 Fiscal Year; Accounting; Organizational Documents
	 	 	81	 
	8.12 No Limitations
	 	 	81	 
	8.13 No Other Negative Pledges
	 	 	81	 
	8.14 PAI Assets
	 	 	82	 
	SECTION 9 EVENTS OF DEFAULT
	 	 	82	 
	9.1 Events of Default
	 	 	82	 
	9.2 Acceleration; Remedies
	 	 	85	 
	9.3 Allocation of Payments After Event of Default
	 	 	86	 
	SECTION 10 AGENCY PROVISIONS
	 	 	87	 
	10.1 Appointment
	 	 	87	 
	10.2 Delegation of Duties
	 	 	88	 
	10.3 Exculpatory Provisions
	 	 	88	 
	10.4 Reliance on Communications
	 	 	89	 
	10.5 Notice of Default
	 	 	90	 
	10.6 Non-Reliance on Administrative Agent and Other Lenders
	 	 	90	 
	10.7 Indemnification
	 	 	91	 
	10.8 Administrative Agent in Its Individual Capacity
	 	 	91	 
	10.9 Successor Agent
	 	 	91	 
	10.10 Administrative Agent May File Proof of Claims
	 	 	92	 
	SECTION 11 MISCELLANEOUS
	 	 	93	 
	11.1 Notices and other Communications; Facsimile Copies
	 	 	93	 
	11.2 Right of Set-Off, Automatic Debits
	 	 	94	 
	11.3 Benefit of Agreement
	 	 	95	 
	11.4 No Waiver; Remedies Cumulative
	 	 	99	 
	11.5 Payment of Expenses; Indemnification
	 	 	99	 
	11.6 Amendments, Waivers and Consents
	 	 	100	 
	11.7 Counterparts
	 	 	101	 
	11.8 Headings
	 	 	101	 
	11.9 Defaulting Lender
	 	 	101	 
	11.10 Survival of Indemnification and Representations and Warranties
	 	 	101	 
	11.11 Governing Law; Jurisdiction
	 	 	102	 
	11.12 Waiver of Jury Trial; Waiver of Consequential Damages
	 	 	102	 
	11.13 Severability
	 	 	102	 
	11.14 Further Assurances
	 	 	103	 
	11.15 Confidentiality
	 	 	103	 
	11.16 Entirety
	 	 	104	 
	11.17 Binding Effect; Continuing Agreement
	 	 	104	 
	11.18 USA PATRIOT Act Notice
	 	 	104	 






iii









 






	 	 	 	 	 
	11.19 Judgment Currency
	 	 	105	 






iv









 






SCHEDULES




	 	 	 
	Schedule 1.1(a)

	 	Commitment Percentages/Lending Offices
	Schedule 1.1(b)

	 	Existing Letters of Credit
	Schedule 1.1(c)

	 	Mandatory Cost Formulae
	Schedule 6.22

	 	Subsidiaries
	Schedule 8.1(k)

	 	Indebtedness
	Schedule 8.2(a)

	 	Repurchase Agreements
	Schedule 8.2(d)

	 	Existing PAI Obligations
	Schedule 8.3

	 	Liens
	Schedule 8.6

	 	Sales of Accounts Receivable
	Schedule 8.8

	 	Investments
	Schedule 11.1

	 	Notices






EXHIBITS




	 	 	 
	Exhibit 2.1(b)

	 	Form of Notice of Borrowing
	Exhibit 2.1(e)

	 	Form of Note
	Exhibit 2.3

	 	Form of Notice of Continuation/Conversion
	Exhibit 7.1(c)

	 	Form of Officer’s Certificate
	Exhibit 7.12

	 	Form of Joinder Agreement
	Exhibit 11.3(b)

	 	Form of Assignment and Assumption






v









 






FIVE-YEAR REVOLVING CREDIT AGREEMENT




     THIS FIVE-YEAR REVOLVING CREDIT AGREEMENT (this “Credit Agreement”), is entered into
as of June 25, 2004 among POLARIS INDUSTRIES INC., a Minnesota corporation (the
“Borrower”), certain of the Subsidiaries of the Borrower (individually a
“Guarantor” and collectively the “Guarantors”), the Lenders (as defined herein),
and BANK OF AMERICA, N.A., as Issuing Lender and Administrative Agent for the Lenders.



RECITALS




     WHEREAS, the Borrower and the Guarantors have requested the Lenders to provide a senior credit
facility to the Borrower in an aggregate principal amount of up to $250,000,000; and



     WHEREAS, the Lenders party hereto have agreed to make the requested senior credit facility
available to the Borrower on the terms and conditions hereinafter set forth.



     NOW, THEREFORE, IN CONSIDERATION of the premises and other good and valuable consideration,
the receipt and sufficiency of which is hereby acknowledged, the parties hereto agree as follows:



SECTION 1




DEFINITIONS AND ACCOUNTING TERMS




     1.1 Definitions.



     As used herein, the following terms shall have the meanings herein specified unless the
context otherwise requires. Defined terms herein shall include in the singular number the plural
and in the plural the singular:




     “Acceptance Partnership” means Polaris Acceptance, an Illinois general
partnership.




     “Acceptance Partnership Agreement” means that certain Partnership Agreement,
dated as of February 7, 1996, between PAI and Transamerica Joint Ventures, Inc., pursuant to
which the Acceptance Partnership was created, as the same may be amended, restated or
otherwise modified from time to time.




     “Acquisition” means the acquisition by any Person of (a) all or substantially
all of the Capital Stock of another Person, (b) all or substantially all of the assets of
another Person or (c) all or substantially all of a line of business of another Person, in
each case whether or not involving a merger or consolidation with such other Person.



 









 






     “Additional Credit Party” means each Person that becomes a Guarantor after the
Closing Date, as provided in Section 7.12 or otherwise.




     “Adjusted Eurodollar Rate” means, with respect to Eurodollar Loans, the
Eurodollar Rate plus the Applicable Percentage.




     “Adjusted Leverage Ratio” means, as of the last day of each fiscal quarter, the
ratio of (a) the quotient of (i) the sum of all Funded Debt for each day during the period
of four fiscal quarters ending on such date, divided by (ii) the number of days in such
period to (b) EBITDA for the period of four fiscal quarters ending on such date.




     “Administrative Agent” means Bank of America, N.A. (or any successor thereto)
or any successor administrative agent appointed pursuant to Section 10.9.




     “Affiliate” means, with respect to any Person, any other Person directly or
indirectly controlling (including but not limited to all directors and officers of such
Person), controlled by or under direct or indirect common control with such Person. A
Person shall be deemed to control a corporation if such Person possesses, directly or
indirectly, the power (a) to vote 10% or more of the securities having ordinary voting power
for the election of directors of such corporation or (b) to direct or cause direction of
the management and policies of such corporation, whether through the ownership of voting
securities, by contract or otherwise.




     “Agency Services Address” means Bank of America, N.A., 1850 Gateway Boulevard,
Concord, California, Attn: Credit Services, or such other address as may be identified by
written notice from the Administrative Agent to the Borrower and the Lenders.




     “Agent-Related Person” means the Administrative Agent (including any successor
administrative agent), together with its Affiliates (including, in the case of Bank of
America in its capacity as the Administrative Agent, BAS), and their respective officers,
directors, employees, agents, counsel and attorneys-in-fact.




     “Alternative Currency” means Euro and each other currency (other than Dollars)
that is approved in accordance with Section 1.8.




     “Alternative Currency Equivalent” means, at any time, with respect to any
amount denominated in Dollars, the equivalent amount thereof in the applicable Alternative
Currency as determined by the Administrative Agent or the Issuing Lender, as the case may
be, at such time on the basis of the Spot Rate (determined in respect of the most recent
Revaluation Date) for the purchase of such Alternative Currency with Dollars.




     “Alternative Currency Sublimit” means an amount equal to $95,000,000. The
Alternative Currency Sublimit is part of, and not in addition to, the Revolving Committed
Amount.



2









 






     “Applicable Percentage” means the appropriate applicable percentages
corresponding to the Adjusted Leverage Ratio in effect as of the most recent Calculation
Date as shown below:



	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	Applicable	 	 	 	 	 	Applicable
	Pricing	 	 	Percentage for	 	Applicable Percentage for	 	Percentage for
	Level	Adjusted Leverage Ratio	 	Eurodollar Loans	 	Letter of Credit Fees	 	Facility Fee
	I
	 	£ .50 to 1.0	 	 	.575	%	 	 	.575	%	 	 	.175	%
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	II
	 	> .50 to 1.0 but	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	£ 1.25 to 1.0	 	 	.675	%	 	 	.675	%	 	 	.200	%
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	III
	 	> 1.25 to 1.0 but	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	£ 2.0 to 1.0	 	 	.775	%	 	 	.775	%	 	 	.225	%
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	IV
	 	> 2.0 to 1.0	 	 	1.000	%	 	 	1.000	%	 	 	.250	%






The Applicable Percentage for Loans, the Letter of Credit Fees and the Facility Fees
shall, in each case, be determined and adjusted quarterly on the date (each a
“Calculation Date”) five Business Days after the date by which the Borrower is
required to provide the officer’s certificate in accordance with the provisions of Section
7.1(c); provided that the initial Applicable Percentage for Loans, the Letter of
Credit Fees and the Facility Fees shall be based on Pricing Level I (as shown above) and
shall remain at Pricing Level I until the first Calculation Date subsequent to the Closing
Date and, thereafter, the Pricing Level shall be determined by the Adjusted Leverage Ratio
calculated as of the most recent fiscal quarter end; provided further that
if the Borrower fails to provide the officer’s certificate required by Section 7.1(c) on or
before the most recent Calculation Date, the Applicable Percentage for Loans, the Letter of
Credit Fees and the Facility Fees from
such Calculation Date shall be based on Pricing Level IV (and the Borrower may be subject to
a default rate of interest, if applicable, pursuant to Section 3.1(b)) until such time as an
appropriate officer’s certificate is provided whereupon the Pricing Level shall be
determined by the then current Adjusted Leverage Ratio. Each Applicable Percentage shall be
effective from one Calculation Date until the next Calculation Date. Any adjustment in the
Applicable Percentage shall be applicable to all existing Loans and Letters of Credit as
well as any new Loans made or Letters of Credit issued.




     “Applicable Time” means, with respect to any borrowings and payments in any
Alternative Currency, the local time in the place of settlement for such Alternative
Currency as may be determined by the Administrative Agent or the Issuing Lender, as the case
may be, to be necessary for timely settlement on the relevant date in accordance with normal
banking procedures in the place of payment.




     “Approved Fund” means any Fund that is administered or managed by (a) a Lender,
(b) an Affiliate of a Lender or (c) an entity or an Affiliate of an entity that administers
or manages a Lender.



3









 






     “Assignment and Assumption” means an assignment and assumption entered into by
a Lender and an Eligible Assignee (with the consent of any party whose consent is required
by Section 11.3(b), and accepted by the Administrative Agent, in substantially the form of
Exhibit 11.3(b) or any other form approved by the Administrative Agent and the
applicable Lenders).




     “Attorney Costs” means all reasonable fees and disbursements of any law firm or
other external counsel and the reasonable allocated cost of internal legal services and all
disbursements of internal counsel.




     “Authorized Officer” means any of the president, chief financial officer, vice
president of finance, treasurer or assistant treasurer of the Borrower.




     “Bank of America” means Bank of America, N.A. or any successor thereto.




     “Bankruptcy Code” means the Bankruptcy Code in Title 11 of the United States
Code, as amended, modified, succeeded or replaced from time to time.




     “BAS” means Banc of America Securities LLC.




     “Base Rate” means for any day a fluctuating rate per annum equal to the higher
of (a) the Federal Funds Rate plus 1/2 of 1% and (b) the rate of interest in effect for such
day as publicly announced from time to time by Bank of America as its “prime rate.” The
“prime rate” is a rate set by Bank of America based upon various factors including Bank of
America’s costs and desired return, general economic conditions and other factors, and is
used as a reference point for pricing some loans, which may be priced at, above, or below
such announced rate. Any change in such rate announced by Bank of America shall take effect
at the opening of business on the day specified in the public announcement of such change.




     “Base Rate Loan” means any Loan bearing interest at a rate determined by
reference to the Base Rate. All Base Rate Loans shall be denominated in Dollars.




     “Borrower” means Polaris Industries Inc., a Minnesota corporation, together
with any successors and permitted assigns.




     “Business Day” means any day other than a Saturday, Sunday or other day on
which commercial banks are authorized to close under the laws of, or are in fact closed in
San Francisco, California, Dallas, Texas, New York, New York, Chicago, Illinois or the state
where the Administrative Agent’s Lending Office with respect to Credit Party Obligations
denominated in Dollars is located and:



4









 






     (a) if such day relates to any interest rate settings as to a Eurodollar Loan
denominated in Dollars, any fundings, disbursements, settlements and payments in
Dollars in respect of any such Eurodollar Loan, or any other dealings in Dollars to
be carried out pursuant to this Credit Agreement in respect of any such Eurodollar
Loan, means any such day on which dealings in deposits in Dollars are conducted by
and between banks in the London interbank eurodollar market;




     (b) if such day relates to any interest rate settings as to a Eurodollar Loan
denominated in Euro, any fundings, disbursements, settlements and payments in Euro
in respect of any such Eurodollar Loan, or any other dealings in Euro to be carried
out pursuant to this Credit Agreement in respect of any such Eurodollar Loan, means
a TARGET Day;




     (c) if such day relates to any interest rate settings as to a Eurodollar Loan
denominated in a currency other than Dollars or Euro, means any such day on which
dealings in deposits in the relevant currency are conducted by and between banks in
the London or other applicable offshore interbank market for such currency; and




     (d) if such day relates to any fundings, disbursements, settlements and
payments in a currency other than Dollars or Euro in respect of a Eurodollar Loan
denominated in a currency other than Dollars or Euro, or any other dealings in any
currency other than Dollars or Euro to be carried out pursuant to this Credit
Agreement in respect of any such Eurodollar Loan (other than any interest rate
settings), means any such day on which banks are open for foreign exchange business
in the principal financial center of the country of such currency.




     “Calculation Date” has the meaning set forth in the definition of Applicable
Percentage.




     “Capital Expenditures” means all expenditures of the Borrower and its
Subsidiaries on a consolidated basis which, in accordance with GAAP, would be classified as
capital expenditures, including, without limitation, Capital Leases.




     “Capital Lease” means, as applied to any Person, any lease of any property
(whether real, personal or mixed) by that Person as lessee which, in accordance with GAAP,
is or should be accounted for as a capital lease on the balance sheet of that Person and the
amount of such obligation shall be the capitalized amount thereof determined in accordance
with GAAP.




     “Capital Stock” means (a) in the case of a corporation, all classes of capital
stock of such corporation, (b) in the case of a partnership, partnership interests (whether
general or



5









 





limited), (c) in the case of a limited liability company, membership interests
and (d) any other interest or participation that confers on a Person the right to receive a
share of the profits and losses of, or distributions of assets of, the issuing Person.




     “Cash Collateralize” means to pledge and deposit with or deliver to the
Administrative Agent, for the benefit of the Issuing Lender and the Lenders, as collateral
for the LOC Obligations, cash or deposit account balances pursuant to documentation in form
and substance satisfactory to the Administrative Agent and the Issuing Lender.




     “Cash Equivalents” means (a) securities issued or directly and fully guaranteed
or insured by the United States of America or any agency or instrumentality thereof
(provided that the full faith and credit of the United States of America is pledged in
support thereof) having maturities of not more than twelve months from the date of
acquisition, (b) Dollar denominated time and demand deposits, certificates of deposit and
banker’s acceptances of (i) any Lender, (ii) any domestic commercial bank having capital and
surplus in excess of $500,000,000 or (iii) any bank whose short-term commercial paper rating
from S&P is at least A-1 or the equivalent thereof or from Moody’s is at least P-1 or the
equivalent thereof (any such bank being an “Approved Bank”), in each case with
maturities of not more than 270 days from the date of acquisition, (c) commercial
paper and variable or fixed rate notes issued by any Approved Bank (or by the parent company
thereof) or any variable rate notes issued by, or guaranteed by, any domestic corporation
rated A-1 (or the equivalent thereof) or better by S&P or P-1 (or the equivalent thereof) or
better by Moody’s and maturing within six months of the date of acquisition, (d) repurchase
agreements with a bank or trust company (including any of the Lenders) or recognized
securities dealer having capital and surplus in excess of $500,000,000 for direct
obligations issued by or fully guaranteed by the United States of America in which the
Borrower shall have a perfected first priority security interest (subject to no other Liens)
and having, on the date of purchase thereof, a fair market value of at least 100% of the
amount of the repurchase obligations, (e) Investments in tax-exempt municipal bonds rated AA
(or the equivalent thereof) or better by S&P or Aa2 (or the equivalent thereof) or better by
Moody’s and (f) Investments, classified in accordance with GAAP as current assets, in money
market investment programs registered under the Investment Company Act of 1940, as amended,
which are administered by reputable financial institutions having capital of at least
$500,000,000 and the portfolios of which are limited to Investments of the character
described in the foregoing subdivisions (a) through (e).




     “Change of Control” means either of the following events:




     (a) any “person” or “group” (within the meaning of Section 13(d) or 14(d) of
the Exchange Act) has become, directly or indirectly, the “beneficial owner” (as
defined in Rules 13d-3 and 13d-5 under the Exchange Act), by way of merger,
consolidation or otherwise of 25% or more of the Voting Stock of the Borrower on a
fully-diluted basis, after giving effect to the conversion and



6









 





exercise of all
outstanding warrants, options and other securities of the Borrower convertible into
or exercisable for Voting Stock of the Borrower (whether or not such securities are
then currently convertible or exercisable); or




     (b) during any period of twelve calendar months, individuals who at the
beginning of such period constituted the board of directors of the Borrower together
with any new members of such board of directors whose elections by such board of
directors or whose nomination for election by the stockholders of the Borrower was
approved by a vote of a majority of the members of such board of directors then
still in office who either were directors at the beginning of such period or whose
election or nomination for election was previously so approved cease for any reason
to constitute a majority of the directors of the Borrower then in office.




     “Closing Date” means the date hereof.




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




     “Commitment Percentage” means, for each Lender, the percentage identified as
its Commitment Percentage on Schedule 1.1(a), as such percentage may be modified in
connection with any assignment made in accordance with the provisions of Section 11.3.




     “Commitments” means (a) with respect to each Lender, the Commitment Percentage
of such Lender multiplied by the Revolving Committed Amount in Dollars and (b) with respect
to the Issuing Lender, the LOC Commitment in Dollars.




     “Credit Documents” means this Credit Agreement, the Notes, any Joinder
Agreement, the LOC Documents, any Notice of Borrowing, and all other related agreements and
documents issued or delivered hereunder or thereunder or pursuant hereto or thereto other
than Hedging Agreements.




     “Credit Exposure” has the meaning set forth in the definition of Required
Lenders in this Section 1.1.




     “Credit Parties” means the Borrower and the Guarantors and “Credit
Party” means any one of them.




     “Credit Party Obligations” means, without duplication, (a) all of the
obligations of the Credit Parties to the Lenders (including the Issuing Lender) and the
Administrative Agent, whenever arising, under this Credit Agreement, the Notes, or any of
the other Credit Documents to which any Credit Party is a party and (b) all liabilities and
obligations owing



7









 





from such Credit Party to any Lender, or any Affiliate of a Lender,
arising under Hedging Agreements.




     “Default” means any event, act or condition which with notice or lapse of time,
or both, would constitute an Event of Default.




     “Defaulting Lender” means, at any time, any Lender that, (a) has failed to make
a Loan or purchase a Participation Interest required pursuant to the terms of this Credit
Agreement (but only for so long as such Loan is not made or such Participation Interest is
not purchased), (b) has failed to pay to the Administrative Agent or any Lender an amount
owed by such Lender pursuant to the terms of this Credit Agreement (but only for so long as
such amount has not been paid) or (c) has been deemed insolvent or has become subject to a
bankruptcy or insolvency proceeding or to a receiver, trustee or similar official.




     “Dollars” and “$” means dollars in lawful currency of the United States
of America.




     “Dollar Equivalent” means, at any time, (a) with respect to any amount
denominated in Dollars, such amount, and (b) with respect to any amount denominated in any
Alternative Currency, the equivalent amount thereof in Dollars as determined by the
Administrative Agent or the Issuing Lender, as the case may be, at such time on the basis of
the Spot Rate (determined in respect of the most recent Revaluation Date) for the purchase
of Dollars with such Alternative Currency.




     “Domestic Subsidiary” means each direct and indirect Subsidiary of the Borrower
that (a) is domiciled or organized under the laws of any State of the United States or the
District of Columbia or (b) maintains the major portion of its assets in the United States
of America.




     “EBIT” means, for any period, with respect to the Borrower and its Subsidiaries
on a consolidated basis, (a) Net Income for such period (excluding the effect of any
extraordinary or other non-recurring gains (including any gain from the sale of property))
plus (b) an amount which, in the determination of Net Income for such period, has been
deducted for (i) Interest Expense for such period and (ii) total Federal, state, foreign or
other income taxes for such period.




     “EBITDA” means, for any period, with respect to the Borrower and its
Subsidiaries on a consolidated basis, the sum of (a) EBIT for such period plus (b) an amount
which, in the determination of Net Income for such period has been deducted for all
depreciation and amortization for such period.




     “Effective Date” means the date on which the conditions set forth in Section
5.1 shall have been fulfilled (or waived in the sole discretion of the Lenders) and on which
the initial Loans shall have been made and/or the initial Letters of Credit shall have been
issued.



8









 






     “Eligible Assets” means any assets or any business (or any substantial part
thereof) used or useful in the same or a similar line of business as the Borrower and its
Subsidiaries are engaged on the Closing Date.




     “Eligible Assignee” means (a) a Lender; (b) an Affiliate of a Lender; (c) an
Approved Fund; and (d) any other Person approved by the Administrative Agent, the Issuing
Lender and the Borrower (such approval not to be unreasonably withheld or delayed);
provided that (i) no assignment can be made pursuant to clauses (a), (b) or (c)
above without the Borrower’s consent if an assignment to such Person would result in any
increased cost to the Borrower under Section 3.9, Section 3.12 or Section 3.13 on the date
of such assignment, (ii) the Borrower’s consent is not required during the existence and
continuation of a Default or an Event of Default, including any consent that may be required
pursuant to clause (i) above, (iii) approval by the Borrower shall be deemed given if no
objection is received by the assigning Lender and the
Administrative Agent from the Borrower within five Business Days after notice of such
proposed assignment has been delivered to the Borrower; and (iv) neither the Borrower nor an
Affiliate of the Borrower shall qualify as an Eligible Assignee ; and
provided further, however, that an Eligible Assignee shall include
only a Lender, an Affiliate of a Lender or another Person, which, through its Lending
Offices, is capable of lending the applicable Alternative Currencies to the Borrower without
the imposition of any additional Indemnified Taxes.




     “EMU” means the economic and monetary union in accordance with the Treaty of
Rome 1957, as amended by the Single European Act 1986, the Maastricht Treaty of 1992 and the
Amsterdam Treaty of 1998.




     “EMU Legislation” means the legislative measures of the European Council for
the introduction of, changeover to or operation of a single or unified European currency.




     “Environmental Claim” means any investigation, written notice, violation,
written demand, written allegation, action, suit, injunction, judgment, order, consent
decree, penalty, fine, lien, proceeding, or written claim whether administrative, judicial,
or private in nature arising (a) pursuant to, or in connection with, an actual or alleged
violation of, any Environmental Law, (b) in connection with any Hazardous Material, (c) from
any assessment, abatement, removal, remedial, corrective, or other response action in
connection with an Environmental Law or other order of a Governmental Authority or (d) from
any actual or alleged damage, injury, threat, or harm to health, safety, natural resources,
or the environment.




     “Environmental Laws” means any current or future legal requirement of any
Governmental Authority pertaining to (a) the protection of health, safety, and the indoor or
outdoor environment, (b) the conservation, management, or use of natural resources and
wildlife, (c) the protection or use of surface water and groundwater or (d) the management,



9









 





manufacture, possession, presence, use, generation, transportation, treatment, storage,
disposal, release, threatened release, abatement, removal, remediation or handling of, or
exposure to, any hazardous or toxic substance or material or (e) pollution (including any
release to land surface water and groundwater) and includes, without limitation, the
Comprehensive Environmental Response, Compensation, and Liability Act of 1980, as amended by
the Superfund Amendments and Reauthorization Act of 1986, 42 USC 9601 et seq., Solid Waste
Disposal Act, as amended by the Resource Conservation and Recovery Act of 1976 and Hazardous
and Solid Waste Amendments of 1984, 42 USC 6901 et seq., Federal Water Pollution Control
Act, as amended by the Clean Water Act of 1977, 33 USC 1251 et seq., Clean Air Act of 1966,
as amended, 42 USC 7401 et seq., Toxic Substances Control Act of 1976, 15 USC 2601 et seq.,
Hazardous Materials Transportation Act, 49 USC App. 1801 et seq., Occupational Safety and
Health Act of 1970, as amended, 29 USC 651 et seq., Oil Pollution Act of 1990, 33 USC 2701
et seq., Emergency Planning and Community Right-to-Know Act of 1986, 42 USC 11001 et seq.,
National Environmental Policy Act of 1969, 42 USC 4321 et seq., Safe Drinking Water Act of
1974, as amended, 42 USC 300(f) et seq., any analogous implementing or successor law, and
any amendment, rule, regulation, order, or directive issued thereunder.




     “Equity Issuance” means any issuance for cash by the Borrower or any of its
Subsidiaries to any Person of (a) shares of its Capital Stock or other equity interests, (b)
any shares of its Capital Stock or other equity interests pursuant to the exercise of
options or warrants or (c) any shares of its Capital Stock or other equity interests
pursuant to the conversion of any debt securities to equity; provided that “Equity
Issuance” shall not include an issuance of equity by such Person pursuant to the exercise of
employee stock options.




     “Equity Reserve” has the meaning assigned to such term in the Revolving Program
Agreement (as defined as of October 15, 2001).




     “ERISA” means the Employee Retirement Income Security Act of 1974, as amended,
and any successor statute thereto, as interpreted by the rules and regulations thereunder,
all as the same may be in effect from time to time. References to sections of ERISA shall
be construed also to refer to any successor sections.




     “ERISA Affiliate” means an entity, whether or not incorporated, which is under
common control with the Borrower or any Subsidiary of the Borrower within the meaning of
Section 4001(a)(14) of ERISA, or is a member of a group which includes the Borrower or any
Subsidiary of the Borrower and which is treated as a single employer under Sections 414(b),
(c), (m) or (o) of the Code.




     “ERISA Event” means (a) with respect to any Single Employer or Multiple
Employer Plan, the occurrence of a Reportable Event or the substantial cessation of
operations (within the meaning of Section 4062(e) of ERISA); (b) the withdrawal of the



10









 





Borrower, any Subsidiary of the Borrower or any ERISA Affiliate from a Multiple Employer
Plan during a plan year in which it was a substantial employer (as such term is defined in
Section 4001(a)(2) of ERISA), or the termination of a Multiple Employer Plan; (c) the
distribution of a notice of intent to terminate or the actual termination of a Plan pursuant
to Section 4041(a)(2) or 4041A of ERISA; (d) the institution of proceedings to terminate or
the actual termination of any Plan by the PBGC under Section 4042 of ERISA; (e) any event or
condition which might constitute grounds under Section 4042 of ERISA for the termination of,
or the appointment of a trustee to administer, any Plan; (f) the complete or partial
withdrawal of the Borrower, any Subsidiary of the Borrower or any ERISA Affiliate from a
Multiemployer Plan or notification that a Multiemployer Plan is in reorganization; (g) the
conditions for imposition of a lien under Section 302(f) of ERISA exist with respect to any
Plan; or (h) the adoption of an amendment to any Plan requiring the provision of security to
such Plan pursuant to Section 307 of ERISA.




     “Euro” and “EUR” mean the lawful currency of the Participating Member
States introduced in accordance with the EMU Legislation.




     “Eurodollar Loan” means a Loan bearing interest based at a rate determined by
reference to the Eurodollar Rate. Eurodollar Loans may be denominated in Dollars or in an
Alternative Currency. All Loans denominated in an Alternative Currency must be Eurodollar
Loans.




     “Eurodollar Rate” means, for the Interest Period for each Eurodollar Loan
comprising part of the same borrowing (including conversions, extensions and renewals), a
per annum interest rate (rounded upwards to the nearest 1/100 of 1%) determined pursuant to
the following formula:



	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	Eurodollar Rate =
	 	London Interbank Offered Rate	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	1 — Eurodollar Reserve Percentage	 	 







     “Eurodollar Reserve Percentage” means for any day, that percentage (expressed
as a decimal) which is in effect from time to time under Regulation D, as such regulation
may be amended from time to time or any successor regulation, as the maximum reserve
requirement (including, without limitation, any basic, supplemental, emergency, special, or
marginal reserves) applicable with respect to Eurocurrency liabilities as that term is
defined in Regulation D (or against any other category of liabilities that includes deposits
by reference to which the interest rate of Eurodollar Loans is determined), whether or not a
Lender has any Eurocurrency liabilities subject to such reserve requirement at that time.
Eurodollar Loans shall be deemed to constitute Eurocurrency liabilities and as such shall be
deemed subject to reserve requirements without benefits of credits for proration, exceptions
or offsets that may be available from time to time to a Lender. The Eurodollar Rate shall
be adjusted automatically on and as of the effective date of any change in the Eurodollar
Reserve Percentage.



11









 






     “Event of Default” shall have the meaning given such term in Section 9.1.




     “Exchange Act” means the Securities Exchange Act of 1934, as amended, and the
rules and regulations promulgated thereunder, as amended, modified, succeeded or replaced
from time to time.




     “Existing Credit Agreements” means (i) that certain Multi-Year Revolving Credit
Agreement, dated as of June 27, 2003 and (ii) that certain 364-Day Credit Agreement, dated
as of June 27, 2003, each among the
Borrower, as borrower, the banks signatories thereto, and Bank of America, as administrative
agent, as amended, supplemented, extended, renewed, restated or replaced from time to time.




     “Existing Letters of Credit” means the letters of credit set forth on
Schedule 1.1(b).




     “Extension of Credit” means, as to any Lender, the making of a Loan by such
Lender (or a participation therein by a Lender) or the issuance of, or participation in, a
Letter of Credit by such Lender.




     “Facility Fees” means the fees payable to the Lenders pursuant to Section
3.4(a).




     “Federal Funds Rate” means, for any day, the rate per annum (rounded upward, if
necessary, to a whole multiple of 1/100 of 1%) equal to the weighted average of the rates on
overnight Federal funds transactions with members of the Federal Reserve System arranged by
Federal funds brokers on such day, as published by the Federal Reserve Bank of New York on
the Business Day next succeeding such day; provided that (a) if such day is not a
Business Day, the Federal Funds Rate for such day shall be such rate on such transactions on
the next preceding Business Day as so published on the next succeeding Business Day, and (b)
if no such rate is so published on such next succeeding Business Day, the Federal Funds Rate
for such day shall be the average rate charged to Bank of America on such day on such
transactions as determined by the Administrative Agent.




     “Fee Letter” means that certain letter agreement, dated as of May 21, 2004,
among the Borrower, BAS and Bank of America.




     “First
Amendment Effective Date” means July 11, 2005.




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



12









 






     “Fuji Contract” means that certain Shareholder Agreement, dated as of February
3, 1995, between Fuji Heavy Industries, Ltd. and the Borrower, providing for the Borrower’s
acquisition of 40% of the shares of Robin Manufacturing U.S.A. Inc.




     “Fund” shall mean any Person (other than a natural Person) that is, or will be,
engaged in making, purchasing, holding or otherwise investing in commercial loans and
similar extensions of credit in the ordinary course of its business.




     “Funded Debt” means, without duplication, the sum of (a) the principal amount
of all obligations of the Borrower and its Subsidiaries for borrowed money, (b) all purchase
money Indebtedness of the Borrower and its Subsidiaries, (c) the principal portion of all
obligations of the Borrower and its Subsidiaries under Capital Leases and (d) all drawn but
unreimbursed amounts under all letters of credit (other than letters of credit supporting
trade payables in the ordinary course of business) issued for the account of the Borrower or
any of its Subsidiaries.




     “GAAP” means generally accepted accounting principles in the United States
applied on a consistent basis and subject to Section 1.3.




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




     “Guarantor” means each of the Domestic Subsidiaries of the Borrower and each
Additional Credit Party, together with their successors and assigns.




     “Guaranty” means the guaranty of the Credit Party Obligations provided by the
Guarantors pursuant to Section 4.




     “Guaranty Obligations” means, with respect to any Person, without duplication,
any obligations (other than endorsements in the ordinary course of business of negotiable
instruments for deposit or collection) guaranteeing any Indebtedness of any other Person in
any manner, whether direct or indirect, and including without limitation any obligation,
whether or not contingent, (a) to purchase any such Indebtedness or other obligation or any
property constituting security therefor, (b) to advance or provide funds or other support
for the payment or purchase of such Indebtedness or obligation or to maintain working
capital, solvency or other balance sheet condition of such other Person (including, without
limitation, maintenance agreements, comfort letters, take or pay arrangements, put
agreements or similar agreements or arrangements) for the benefit of the holder of
Indebtedness of such other Person, (c) to purchase or lease property, securities or services
for the purpose of assuring the obligee in respect of such Indebtedness or other obligation
of the payment or performance of such Indebtedness or other obligation, or (d) to otherwise
assure or hold harmless the owner of such Indebtedness or obligation against loss in respect
thereof. The amount of any Guaranty Obligation hereunder shall (subject to any



13









 





limitations
set forth therein) be deemed to be an amount equal to the outstanding principal amount (or
maximum principal amount, if larger) of the Indebtedness in respect of which such Guaranty
Obligation is made, or, if less, the maximum amount for which such Person may be liable
under the terms of the instruments evidencing such Guaranty Obligation.




     “Hazardous Materials” means any substance, material or waste defined in or
regulated under any Environmental Laws.




     “Hedging Agreements” means, collectively, interest rate protection agreements,
foreign currency exchange agreements, commodity purchase or option agreements or other
interest or exchange rate or commodity price hedging agreements, in each case, entered into
or purchased by a Credit Party.




     “Indebtedness” of any Person means, without duplication, (a) all obligations of
such Person for borrowed money, (b) all obligations of such Person evidenced by bonds,
debentures, notes or similar instruments, or upon which interest payments are customarily
made, (c) all obligations of such Person under conditional sale or other title retention
agreements relating to property purchased by such Person to the extent of the value of such
property (other than customary reservations or retentions of title under agreements with
suppliers entered into in the ordinary course of business), (d) all obligations, other than
intercompany items, of such Person issued or assumed as the deferred purchase price of
property or services purchased by such Person which would appear as liabilities on a balance
sheet of such Person, (e) 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, or payable out of the proceeds of production from, property owned or acquired by such
Person, whether or not the obligations secured thereby have been assumed, (f) all Guaranty
Obligations of such Person, (g) the principal portion of all obligations of such Person
under (i) Capital Leases and (ii) any synthetic lease, tax retention operating lease,
off-balance sheet loan or similar off-balance sheet financing product of such Person where
such transaction is considered borrowed money indebtedness for tax purposes but is
classified as an operating lease in accordance with GAAP (collectively, “Synthetic
Leases”), (h) all obligations of such Person to repurchase any securities which
repurchase obligation is related to the issuance thereof, including, without limitation,
obligations commonly known as residual equity appreciation potential shares, (i) all net
obligations of such Person in respect of Hedging Agreements, (j) the maximum amount of all
performance and standby letters of credit issued or bankers’ acceptances facilities created
for the account of such Person and, without duplication, all drafts drawn thereunder (to the
extent unreimbursed), and (k) the aggregate amount of uncollected accounts receivable of
such Person subject at such time to a sale of receivables (or similar transaction) unless
such transaction is effected without recourse to such Person. The Indebtedness of any
Person shall include the Indebtedness of any partnership or unincorporated joint venture to
the extent such Indebtedness is recourse to such Person.



14









 






     “Indemnified Liabilities” has the meaning set forth in Section 11.5.




     “Interest Coverage Ratio” means, as of the last day of each fiscal quarter, the
ratio of (a) EBIT for the period of four fiscal quarters ending on such date to (b)
Interest Expense for the period of four fiscal quarters ending on such date.




     “Interest Expense” means, for any period, with respect to the Borrower and its
Subsidiaries on a consolidated basis, all interest expense including the interest component
under Capital Leases, as determined in accordance with GAAP.




     “Interest Payment Date” means (a) as to Base Rate Loans, the last Business Day
of each calendar month and the Maturity Date and (b) as to Eurodollar Loans, the last day of
each applicable Interest Period and the Maturity Date and in addition, where the applicable
Interest Period for a Eurodollar Loan is greater than three months, then also the date three
months from the beginning of the Interest Period and each three months thereafter.




     “Interest Period” means, as to Eurodollar Loans, a period of seven, fourteen or
twenty-one days’ duration or one, two, three or six months’ duration, as the Borrower may
elect, commencing, in each case, on the date of the borrowing (including continuations and
conversions thereof); provided, however, (a) if any Interest Period would
end on a day which is not a Business Day, such Interest Period shall be extended to the next
succeeding Business Day (except that where the next succeeding Business Day falls in the
next succeeding calendar month, then on the next preceding Business Day), (b) no Interest
Period shall extend beyond the Maturity Date and (c) where an Interest Period begins on a
day for which there is no numerically corresponding day in the calendar month in which the
Interest Period is to end, such Interest Period shall end on the last Business Day of such
calendar month.




     “Investment” in any Person means (a) the acquisition (whether for cash,
property, services, assumption of Indebtedness, securities or otherwise, but excluding
Capital Expenditures and acquisitions of inventory in the ordinary course of business) of
assets, shares of Capital Stock, bonds, notes, debentures, partnership, joint ventures or
other ownership interests or other securities of such other Person or (b) any deposit with,
or advance, loan or other extension of credit to, such Person (other than deposits made in
connection with the lease or purchase of equipment, inventory or other assets in the
ordinary course of business) or (c) any other capital contribution to or investment in such
Person, including, without limitation, any Guaranty Obligation (including any support for a
letter of credit issued on behalf of such Person) incurred for the benefit of such Person.




     “Issuing Lender” means Bank of America (or any successor thereto) or such other
consenting Lender approved by Bank of America in its sole discretion.




     “Issuing Lender Fees” has the meaning set forth in Section 3.4(c).



15









 






     “Joinder Agreement” means a Joinder Agreement substantially in the form of
Exhibit 7.12.




     “Laws” means, collectively, all international, foreign, Federal, state and
local statutes, treaties, rules, guidelines, regulations, ordinances, codes and
administrative or judicial precedents or authorities, including the interpretation or
administration thereof by any Governmental Authority charged with the enforcement,
interpretation or administration thereof, and all applicable administrative orders, directed
duties, requests, licenses, authorizations and permits of, and agreements with, any
Governmental Authority, in each case whether or not having the force of law.




     “Lender” means any of the Persons identified as a “Lender” on the signature
pages hereto, and any Eligible Assignee which may become a Lender by way of assignment in
accordance with the terms hereof, together with their successors and permitted assigns.




     “Lending Office” means, as to any Lender, the office or offices of such Lender
described as such on Schedule 1.1(a), or such other office or offices as a Lender
may from time notify to the Borrower and the Administrative Agent.




     “Letter of Credit” means any letter of credit issued for the account of the
Borrower by the Issuing Lender pursuant to Section 2.2, as such letter of credit may be
amended, modified, extended, renewed or replaced. Letters of Credit may be issued in
Dollars or in an Alternative Currency.




     “Letter of Credit Application” means an application and agreement for the
issuance or amendment of a Letter of Credit in the form from time to time in use by the
Issuing Lender.




     “Letter of Credit Expiration Date” means the day that is seven days prior to
the Maturity Date then in effect (or, if such day is not a Business Day, the next preceding
Business Day).




     “Leverage Ratio” means, as of the last day of each fiscal quarter, the ratio of
(a) Funded Debt on such date plus any Guaranty Obligations permitted by Section
8.2(e) that, in the aggregate, exceed $30,000,000 to (b) EBITDA for the period of four
fiscal quarters ending on such date.




     “Lien” means any mortgage, pledge, hypothecation, assignment, deposit
arrangement, security interest, encumbrance, lien (statutory or otherwise), preference,
priority or charge of any kind, including, without limitation, any agreement to give any of
the foregoing, any conditional sale or other title retention agreement, and any lease in the
nature thereof.



16









 






     “Loan” or “Loans” means the Loans (or a portion of any Loan),
individually or collectively, as appropriate, made to the Borrower pursuant to Section 2.1.




     “LOC Commitment” means the commitment of the Issuing Lender to issue Letters of
Credit for the account of the Borrower in an aggregate face amount any time outstanding
(together with the amounts of any unreimbursed drawings thereon) of up to the LOC Committed
Amount.




     “LOC Committed Amount” means FIFTEEN MILLION DOLLARS ($15,000,000). The LOC
Committed Amount is part of, and not in addition to, the Revolving Committed Amount.




     “LOC Documents” means, with respect to any Letter of Credit, such Letter of
Credit, any amendments thereto, any documents delivered in connection therewith, any
application therefor (including all Letter of Credit Applications), and any agreements,
instruments, guarantees or other documents (whether general in application or applicable
only to such Letter of Credit) governing or providing for (a) the rights and obligations of
the parties concerned or at risk or (b) any collateral security for such obligations.




     “LOC Obligations” means, at any time, the sum, without duplication, of (a) the
maximum amount which is, or at any time thereafter may become, available to be drawn under
Letters of Credit then outstanding, assuming compliance with all requirements for drawings
referred to in such Letters of Credit plus (b) the aggregate amount of all drawings
under Letters of Credit honored by the Issuing Lender but not theretofore reimbursed.




     “London Interbank Offered Rate” means, with respect to any Eurodollar Loan for
the Interest Period applicable thereto:




     (a) the rate per annum equal to the British Bankers Association LIBOR Rate (“BBA
LIBOR”), as published by Reuters (or other commercially available source providing
quotations of BBA LIBOR as designated by the Administrative Agent from time to time) at
approximately 11:00 a.m., London time, two Business Days prior to the commencement of such
Interest Period, for deposits in the relevant currency (for delivery on the first day of
such Interest Period) with a term equivalent to such Interest Period, or




     (b) if the rate referenced in the preceding clause (a) does not appear on such page or
service or such page or service shall not be available, the rate per annum determined by the
Administrative Agent to be the rate at which deposits in the relevant currency for delivery
on the first day of such Interest Period in Same Day Funds in the approximate amount of the
Eurodollar Loan being made, continued or converted by Bank of America and with a term
equivalent to such Interest Period would be offered by Bank of America’s London Branch (or
other Bank of America branch or Affiliate) to major



17









 





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




     “Mandatory Borrowing” has the meaning set forth in Section 2.2(d).




     “Mandatory Cost” means, with respect to any period, the percentage rate per
annum determined in accordance with Schedule 1.1(c).




     “Material Adverse Effect” means a material adverse effect on (a) the business,
assets, liabilities (actual or contingent), operations, condition (financial or otherwise)
or prospects of the Borrower and its Subsidiaries taken as a whole, (b) the ability of the
Borrower, or of the Credit Parties taken as a whole, to perform its or their obligations
under this Credit Agreement or any of the other Credit Documents, or (c) the validity or
enforceability of this Credit Agreement or any of the other Credit Documents, or the
material rights and remedies of the Lenders hereunder or thereunder taken as a whole.




     “Maturity Date” means June 25, 2009.




     “Moody’s” means Moody’s Investors Service, Inc., or any successor or assignee
of the business of such company in the business of rating securities.




     “Multiemployer Plan” means a Plan which is a multiemployer plan as defined in
Sections 3(37) or 4001(a)(3) of ERISA.




     “Multiple Employer Plan” means a Plan covered by Title IV of ERISA (other than
a Multiemployer Plan) in which the Borrower, any Subsidiary of the Borrower or any ERISA
Affiliate and at least one employer other than the Borrower, any Subsidiary of the Borrower
or any ERISA Affiliate are contributing sponsors.




     “Net Cash Proceeds” means the aggregate cash proceeds received from an Equity
Issuance net of (a) reasonably identifiable transaction costs payable to third parties, and
(b) actual taxes paid or payable with respect to such proceeds.




     “Net Income” means, for any period, the net income after taxes for such period
of the Borrower and its Subsidiaries on a consolidated basis, as determined in accordance
with GAAP.




     “Net Worth” means, as of any date, the shareholder’s equity or net worth of the
Borrower and its Subsidiaries, on a consolidated basis, as determined in accordance with
GAAP.



18









 






     “Note” or “Notes” means the promissory notes of the Borrower in favor
of each of the Lenders evidencing the Loans provided pursuant to Section 2.1, individually
or collectively, as appropriate, as such
promissory notes may be amended, modified, supplemented, extended, renewed or replaced from
time to time and as evidenced in the form of Exhibit 2.1(e).




     “Notice of Borrowing” means a request by the Borrower for a Loan, in the form
of Exhibit 2.1(b).




     “Notice of Continuation/Conversion” means a request by the Borrower to continue
an existing Eurodollar Loan to a new Interest Period or to convert a Eurodollar Loan to a
Base Rate Loan or a Base Rate Loan to a Eurodollar Loan, in the form of Exhibit 2.3.




     “Overnight Rate” means, for any day, (a) with respect to any amount denominated
in Dollars, the greater of (i) the Federal Funds Rate and (ii) an overnight rate determined
by the Administrative Agent or the Issuing Lender, as the case may be, in accordance with
banking industry rules on interbank compensation, and (b) with respect to any amount
denominated in an Alternative Currency, the rate of interest per annum at which overnight
deposits in the applicable Alternative Currency, in an amount approximately equal to the
amount with respect to which such rate is being determined, would be offered for such day by
a branch or Affiliate of Bank of America in the applicable offshore interbank market for
such currency to major banks in such interbank market.




     “PAI” means Polaris Acceptance, Inc., a Minnesota corporation.




     “Participating Member State” means each state so described in any EMU
Legislation.




     “Participation Interest” means the Extension of Credit by a Lender by way of a
purchase of a participation in Letters of Credit or LOC Obligations as provided in Section
2.2 or in any Loans as provided in Section 3.8.




     “Participation Purchaser” shall have the meaning assigned to such term in
Section 11.3(d).




     “PBGC” means the Pension Benefit Guaranty Corporation established pursuant to
Subtitle A of Title IV of ERISA and any successor thereto.




     “Permitted Acquisition” means an Acquisition by a Credit Party or any of its
Subsidiaries for consideration no greater than the fair market value of the Capital Stock or
property acquired; provided that (a) the property acquired (or the property of the Person
acquired) in such Acquisition constitutes Eligible Assets (or goodwill associated




19









 







therewith), (b) in the case of an Acquisition of the Capital Stock of another Person, the
board of directors (or other comparable governing body) of such other Person shall have duly
approved such Acquisition, (c) if the aggregate consideration to be paid for such
Acquisition equals or exceeds $25,000,000 (including, without limitation, the amount of any
Indebtedness assumed in connection with such Acquisition), the Borrower shall have delivered
to the Administrative Agent, prior to the closing of such Acquisition, a certificate of an
Authorized Officer of the Borrower (i) providing calculations on a pro forma
basis of each of the financial covenants set forth in Section 7.2 by giving effect to such
Acquisition both (A) as of the actual date of such Acquisition and (B) as of the first day
of the most recently ended fiscal quarter, which calculations shall demonstrate that, as of
each such date, the Credit Parties are or would have been in compliance with all of the
financial covenants set forth in Section 7.2 and (ii) both before and after giving effect to
such Acquisition, no Default or Event of Default exists,
(d) the representations and warranties made by the Credit Parties in any Credit Document
shall be true and correct in all material respects at and as if made as of the date of such
Acquisition (after giving effect thereto) except to the extent such representations and
warranties expressly relate to an earlier date, (e) subsequent to March 31, 2003, (i) the
aggregate consideration paid and Investments made with respect to all Acquisitions
(including, without limitation, Indebtedness assumed in connection with such Acquisitions)
shall not exceed $300,000,000 and (ii) the aggregate amount of Indebtedness assumed in
connection with all Acquisitions shall not exceed $150,000,000, (f) if such Acquisition
involves the formation of a new Subsidiary of the Borrower, such Subsidiary shall comply
with Section 7.12 and (g) such Acquisition is undertaken in accordance with all laws, rules,
regulations, orders, writs, judgments, injunctions, decrees and awards to which any party to
such Acquisition may be subject.




     “Permitted Investments” means Investments which are, without duplication, (a)
cash or Cash Equivalents, (b) trade accounts receivable created, acquired or made in the
ordinary course of business and payable or dischargeable in accordance with customary trade
terms, (c) inventory, raw materials and general intangibles acquired in the ordinary course
of business, (d) Investments by a Credit Party in another Credit Party, (e) Permitted
Acquisitions, (f) travel advances to management personnel and employees in the ordinary
course of business, (g) Investments existing as of the Closing Date and set forth on
Schedule 8.8, (h) additional Investments in Foreign Subsidiaries that do not exceed
$25,000,000 in the aggregate during the term of this Credit Agreement, (i) additional
Investments made pursuant to the Fuji Contract or pursuant to an expansion of the engine
manufacturing facility contemplated thereby that do not exceed $10,000,000 in the aggregate
during the term of this Credit Agreement, (j) in accordance with Section 8.2, the existing
Investments on Schedule 8.2(d) plus additional Investments in the form of capital
contributions by PAI in Acceptance Partnership (or by the Borrower in PAI to make such
capital contributions) in an amount not to exceed $30,000,000 in the aggregate, during the
term of this Credit Agreement; it being understood that the Borrower may not have or make
any Investments in Acceptance Partnership or PAI that constitute Guaranty Obligations



20









 






(other
than the obligation regarding capital contributions as set forth herein), (k) Investments in
the Equity Reserve as required under the Revolving Program Agreement, (l) Investments in KTM
Power Sports AG, an Austrian corporation, in an amount not to exceed $95,000,000 and (m)
additional Investments (in addition to those set forth above) not to exceed, in the
aggregate, $15,000,000 during the term of this Credit Agreement.




     “Permitted Liens” means (a) Liens securing all Credit Party Obligations, (b)
Liens for taxes not yet due or Liens for taxes being contested in good faith by appropriate
proceedings for which adequate reserves determined in accordance with GAAP have been
established (and as to which the property subject to any such Lien is not yet subject to
foreclosure, sale, collection, levy or loss on account thereof), (c) Liens in respect of
property imposed by law arising in the ordinary course of business such as materialmen’s,
mechanics’, warehousemen’s, carrier’s, landlords’ and other nonconsensual statutory Liens
which are not yet due and payable or which are being contested in good faith by appropriate
proceedings for which adequate reserves determined in accordance with GAAP have been
established (and as to which the property subject to any such Lien is not yet subject to
foreclosure, sale or loss on account thereof), (d) Liens (other than Liens imposed under
ERISA) consisting of pledges or deposits made in the ordinary course of business to secure
payment of worker’s compensation insurance, unemployment insurance, pensions or social
security programs, (e) Liens arising from good faith deposits in connection with or to
secure performance of tenders, bids, leases, government contracts, performance and
return-of-money bonds and other similar obligations incurred in the ordinary course of
business (other than obligations in respect of the payment of borrowed money), (f) Liens
arising from good faith deposits in connection with or to secure performance of statutory
obligations and surety and appeal bonds, (g) easements, rights-of-way, restrictions
(including zoning restrictions), matters of plat, minor defects or irregularities in title
and other similar charges or encumbrances not, in any material respect, impairing the use of
the encumbered property for its intended purposes, (h) judgment Liens that would not
constitute an Event of Default, (i) Liens in connection with Indebtedness permitted by
Section 8.1(d), (j) Liens arising by virtue of any statutory or common law provision
relating to banker’s liens, rights of setoff or similar rights as to deposit accounts or
other funds maintained with a creditor depository institution, (k) Liens existing on the
date hereof and identified on Schedule  8.3 and any renewals and extensions thereof not otherwise prohibited by this Credit
Agreement; provided that, with respect to Liens identified on Schedule 8.3,
(i) no such Lien shall extend to any property other than the property subject thereto on the
Closing Date and (ii) the principal amount of the Indebtedness secured by such Liens shall
not be increased and (l) Liens on the Equity Reserve.




     “Person” means any individual, partnership, joint venture, firm, corporation,
limited liability company, association, trust or other enterprise (whether or not
incorporated), or any Governmental Authority.



21









 






     “Plan” means any employee benefit plan (as defined in Section 3(3) of ERISA)
which is covered by ERISA and with respect to which the Borrower, any Subsidiary of the
Borrower or any ERISA Affiliate is (or, if such plan were terminated at such time, would
under Section 4069 of ERISA be deemed to be) an “employer” within the meaning of Section
3(5) of ERISA.




     “Polaris Participation Fee Shortfall” has the meaning assigned to such term in
the Revolving Program Agreement dated as of October 15, 2001 without giving effect to any
amendments, modifications, renewals, restatements or replacements.




     “Polaris Participation Fee Shortfall Obligations” means (a) actual amounts paid
or deducted from the Equity Reserve in connection with any Polaris Participation Fee
Shortfall plus (b) amounts in the Equity Reserve.




     “Real Properties” has the meaning given thereto in Section 6.20.




     “Regulation A, D, T, U or X” means Regulation A, D, T, U or X, respectively, of
the Board of Governors of the Federal Reserve System as from time to time in effect and any
successor to all or a portion thereof.




     “Reportable Event” means any of the events set forth in Section 4043(c) of
ERISA, other than those events as to which the notice requirement has been waived by
regulation or by the PBGC.




     “Required Lenders” means Lenders whose aggregate Credit Exposure (as
hereinafter defined) constitutes more than 50% of the Credit Exposure of all Lenders at such
time; provided, however, that if any Lender shall be a Defaulting Lender at
such time then there shall be excluded from the determination of Required Lenders the
aggregate principal amount of Credit Exposure of such Lender at such time. For purposes
hereof, the term “Credit Exposure” as applied to each Lender shall mean (a) at any time
prior to the termination of the Commitments, the sum of the Commitment Percentage of such
Lender multiplied by the Revolving Committed Amount and (b) at any time after the
termination of the Commitments, the sum of (i) the principal balance of the outstanding
Loans of such Lender plus (ii) such Lender’s Participation Interests in the face amount of
the outstanding Letters of Credit.




     “Requirement of Law” means, as to any Person, the articles or certificate of
incorporation and by-laws or other organizational or governing documents of such Person, and
any law, treaty, rule or regulation or final, non-appealable determination of an arbitrator
or a court or other Governmental Authority, in each case applicable to or binding upon such
Person or to which any of its material property is subject.



22









 






     “Revaluation Date” means (a) with respect to any Loan, each of the following:
(i) each date of a borrowing of a Eurodollar Loan denominated in an Alternative Currency,
(ii) each date of a continuation of a Eurodollar Loan denominated in an Alternative Currency
pursuant to Section 2.1, and (iii) such additional dates as the Administrative Agent shall
determine or the Required Lenders shall require; and (b) with respect to any Letter of
Credit, each of the following: (i) each date of issuance of a Letter of Credit denominated
in an Alternative Currency, (ii) each date of an amendment of any such Letter of
Credit having the effect of increasing the amount thereof (solely with respect to the
increased amount), (iii) each date of any payment by the Issuing Lender under any Letter of
Credit denominated in an Alternative Currency, and (iv) such additional dates as the
Administrative Agent or the Issuing Lender shall determine or the Required Lenders shall
require.




     “Revolving Committed Amount” means TWO HUNDRED FIFTY MILLION DOLLARS
($250,000,000) or such lesser amount to which the Revolving Committed Amount may be reduced
pursuant to Section 2.1(d).




     “Revolving Program Agreement” means that certain Revolving Program Agreement
entered into as of October 15, 2001, as may be amended, modified, extended, renewed or
replaced, by and between Household Bank (SB), N.A., a national banking association, and
Polaris Sales Inc., a Minnesota corporation.




     “S&P” means Standard & Poor’s Ratings Services, a division of The McGraw-Hill
Companies, Inc. or any successor or assignee of the business of such division in the
business of rating securities.




     “Same Day Funds” means (a) with respect to disbursements and payments in
Dollars, immediately available funds, and (b) with respect to disbursements and payments in
an Alternative Currency, same day or other funds as may be determined by the Administrative
Agent or the Issuing Lender, as the case may be, to be customary in the place of
disbursement or payment for the settlement of international banking transactions in the
relevant Alternative Currency.




     “Securities Act” means the Securities Act of 1933, as amended, and the rules
and regulations promulgated thereunder, as amended, modified, succeeded or replaced from
time to time.




     “Single Employer Plan” means any Plan which is covered by Title IV of ERISA,
but which is not a Multiemployer Plan or a Multiple Employer Plan.




     “Solvent” means, with respect to any Person as of a particular date, that on
such date (a) such Person is able to pay its debts and other liabilities, contingent
obligations and other commitments as they mature in the normal course of business, (b) such
Person does not



23









 






intend to, and does not believe that it will, incur debts or liabilities
beyond such Person’s ability to pay as such debts and liabilities mature in their ordinary
course, (c) such Person is not engaged in a business or a transaction, and is not about to
engage in a business or a transaction, for which such Person’s assets would constitute
unreasonably small capital after giving due consideration to the prevailing practice in the
industry in which such Person is engaged or is to engage, (d) the fair value of the assets
of such Person is greater than the total amount of liabilities, including, without
limitation, contingent liabilities, of such Person and (e) the present fair saleable value
of the assets of such Person is not less than the amount that will be required to pay the
probable liability of such Person on its debts as they become absolute and matured. In
computing the amount of contingent liabilities at any time, it is intended that such
liabilities will be computed at the amount which, in light of all the facts and
circumstances existing at such time, represents the amount that can reasonably be expected
to become an actual or matured liability.




     “Spot Rate” for a currency means the rate determined by the Administrative
Agent or the Issuing Lender, as applicable, to be the rate quoted by the Person acting in
such capacity as the spot rate for the purchase by such Person of such currency with another
currency through its principal foreign exchange trading office at approximately 11:00 a.m.
on the date two Business Days prior to the date as of which the foreign exchange computation
is made; provided that the Administrative Agent or the Issuing Lender may obtain
such spot rate from another financial institution designated by the Administrative Agent or
the Issuing Lender if the Person acting in such capacity does not have as of the date of
determination a spot buying rate for any such currency; and provided further
that the Issuing Lender may use such spot rate

quoted on the date as of which the foreign exchange computation is made in the case of
any Letter of Credit denominated in an Alternative Currency.




     “Subsidiary” means, as to any Person, (a) any corporation more than 50% of
whose stock of any class or classes having by the terms thereof ordinary voting power to
elect a majority of the directors of such corporation (irrespective of whether or not at the
time, any class or classes of such corporation shall have or might have voting power by
reason of the happening of any contingency) is at the time owned by such Person directly or
indirectly through Subsidiaries, and (b) any partnership, association, joint venture or
other entity in which such person directly or indirectly through Subsidiaries has more than
a 50% equity interest at any time.




     “Synthetic Leases” has the meaning set forth in the definition of Indebtedness
in this Section 1.1.




     “Tangible Net Worth” means, as of any date, Net Worth less the book
value of those assets on the balance sheet of the Borrower and its Subsidiaries, on a
consolidated basis, that would, in accordance with GAAP, be treated as intangibles, it being
understood that deferred tax assets do not constitute intangible assets under GAAP.



24









 






     “TARGET Day” means any day on which the Trans-European Automated Real-time
Gross Settlement Express Transfer (TARGET) payment system (or, if such payment system ceases
to be operative, such other payment system (if any) determined by the Administrative Agent
to be a suitable replacement) is open for the settlement of payments in Euro.




     “Total Assets” means all items that in accordance with GAAP would be classified
as assets of the Borrower and its Subsidiaries on a consolidated basis.




     “Total Utilization” means, as of any date, the sum of the principal amounts of
(a) the Dollar Equivalent amount of the Loans outstanding under this Credit Agreement on
such date plus (b) the Dollar Equivalent amount of the aggregate LOC Obligations outstanding
under this Credit Agreement on such date.




     “Utilization Fees” means the fees payable to the Lenders pursuant to Section
3.4(b).




     “Voting Stock” means all classes of the Capital Stock of such Person then
outstanding and normally entitled to vote in the election of directors (or similar governing
authority).



     1.2 Computation of Time Periods and Other Definitional Provisions.



     For purposes of computation of periods of time hereunder, the word “from” means “from and
including” and the words “to” and “until” each mean “to but excluding.” References in this Credit
Agreement to “Articles”, “Sections”, “Schedules” or “Exhibits” shall be to Articles, Sections,
Schedules or Exhibits of or to this Credit Agreement unless otherwise specifically provided.



     1.3 Accounting Terms.



     Except as otherwise expressly provided herein, all accounting terms used herein shall be
interpreted, and all financial statements and certificates and reports as to financial matters
required to be delivered to the Lenders hereunder shall be prepared, in accordance with GAAP
applied on a consistent basis. All calculations made for the purposes of determining compliance
with this Credit Agreement shall (except as otherwise expressly provided herein) be made by
application of GAAP applied on a basis consistent with the most recent annual or quarterly
financial statements delivered pursuant to Section 7.1 (or, prior to the delivery of the first
financial statements pursuant to Section 7.1, consistent with the financial statements delivered
pursuant to Section 5.1(d)); provided, however, if (a) the Borrower shall object to
determining such compliance on such basis at the time of delivery of such financial statements due
to any change in GAAP or the rules promulgated with respect thereto or (b) the
Administrative Agent or the Required Lenders shall so object in writing within 30 days after
delivery of such financial statements, then such calculations shall be made on a basis consistent
with GAAP as in effect as



25









 





of the date of the most recent financial statements delivered by the
Borrower to the Lenders to which no such objection shall have been made.




     1.4 Time.



     All references to time herein shall be references to Eastern Standard Time or Eastern Daylight
time, as the case may be, unless specified otherwise.



     1.5 References to Agreements and Requirement of Laws.



     Unless otherwise expressly provided herein: (a) references to organization documents,
agreements (including the Credit Documents) and other contractual instruments shall be deemed to
include all subsequent amendments, restatements, extensions, supplements and other modifications
thereto, but only to the extent that such amendments, restatements, extensions, supplements and
other modifications are not prohibited by any Credit Document and (b) references to any Requirement
of Law shall include all statutory and regulatory provisions consolidating, amending, replacing,
supplementing or interpreting such Requirement of Law.



     1.6 Letter of Credit Amounts.



     Unless otherwise specified, all references herein to the amount of a Letter of Credit at any
time shall be deemed to mean the Dollar Equivalent of the maximum face amount of such Letter of
Credit after giving effect to all increases thereof contemplated by such Letter of Credit or the
LOC Documents related thereto, whether or not such maximum face amount is in effect at such time.



     1.7 Exchange Rates; Currency Equivalents.




     (a) The Administrative Agent or the Issuing Lender, as applicable, shall determine the
Spot Rates as of each Revaluation Date to be used for calculating Dollar Equivalent amounts
of Extensions of Credit and Total Utilization denominated in Alternative Currencies. Such
Spot Rates shall become effective as of such Revaluation Date and shall be the Spot Rates
employed in converting any amounts between the applicable currencies until the next
Revaluation Date to occur. Except for purposes of financial statements delivered by Credit
Parties hereunder or calculating financial covenants hereunder or except as otherwise
provided herein, the applicable amount of any currency (other than Dollars) for purposes of
the Credit Documents shall be such Dollar Equivalent amount as so determined by the
Administrative Agent or the Issuing Lender, as applicable.




     (b) Wherever in this Credit Agreement in connection with a borrowing, conversion,
continuation or prepayment of a Eurodollar Loan or the issuance, amendment or extension of a
Letter of Credit, an amount, such as a required minimum or multiple



26









 






amount, is expressed in
Dollars, but such borrowing, Eurodollar Loan or Letter of Credit is denominated in an
Alternative Currency, such amount shall be the relevant Alternative Currency Equivalent of
such Dollar amount (rounded to the nearest unit of such Alternative Currency, with 0.5 of a
unit being rounded upward), as determined by the Administrative Agent or the Issuing Lender,
as the case may be.



     1.8 Additional Alternative Currencies.




     (a) The Borrower may from time to time request that Eurodollar Loans be made
and/or Letters of Credit be issued in a currency other than those specifically listed in the
definition of
“Alternative Currency;” provided that such requested currency is a lawful
currency (other than Dollars) that is readily available and freely transferable and
convertible into Dollars. In the case of any such request with respect to the making of
Eurodollar Loans, such request shall be subject to the approval of the Administrative Agent
and the Lenders; and in the case of any such request with respect to the issuance of Letters
of Credit, such request shall be subject to the approval of the Administrative Agent and the
Issuing Lender.




     (b) Any such request shall be made to the Administrative Agent not later than 11:00
a.m., 20 Business Days prior to the date of the desired Extension of Credit (or such other
time or date as may be agreed by the Administrative Agent and, in the case of any such
request pertaining to Letters of Credit, the Issuing Lender, in its or their sole
discretion). In the case of any such request pertaining to Eurodollar Loans, the
Administrative Agent shall promptly notify each Lender thereof; and in the case of any such
request pertaining to Letters of Credit, the Administrative Agent shall promptly notify the
Issuing Lender thereof. Each Lender (in the case of any such request pertaining to
Eurodollar Loans) or the Issuing Lender (in the case of a request pertaining to Letters of
Credit) shall notify the Administrative Agent, not later than 11:00 a.m., ten Business Days
after receipt of such request whether it consents, in its sole discretion, to the making of
Eurodollar Loans or the issuance of Letters of Credit, as the case may be, in such requested
currency.




     (c) Any failure by a Lender or the Issuing Lender, as the case may be, to respond to
such request within the time period specified in the preceding sentence shall be deemed to
be a refusal by such Lender or the Issuing Lender, as the case may be, to permit Eurodollar
Loans to be made or Letters of Credit to be issued in such requested currency. If the
Administrative Agent and all the Lenders consent to making Eurodollar Loans in such
requested currency, the Administrative Agent shall so notify the Borrower and such currency
shall thereupon be deemed for all purposes to be an Alternative Currency hereunder for
purposes of any borrowings of Eurodollar Loans; and if the Administrative Agent and the
Issuing Lender consent to the issuance of Letters of Credit in such requested currency, the
Administrative Agent shall so notify the Borrower and such currency shall thereupon be
deemed for all purposes to be an Alternative Currency



27









 






hereunder for purposes of any Letter
of Credit issuances. If the Administrative Agent shall fail to obtain consent to any
request for an additional currency under this Section 1.8, the Administrative Agent
shall promptly so notify the Borrower.



SECTION 2




CREDIT FACILITIES



     2.1 Loans.




     (a) Loan Commitment. Subject to the terms and conditions set forth herein,
including but not limited to Section 5.2, each Lender severally agrees to make revolving
loans (each a “Loan” and collectively the “Loans”) to the Borrower, in
Dollars or in one or more Alternative Currencies, at any time and from time to time, during
the period from and including the Effective Date to but not including the Maturity Date (or
such earlier date if the Revolving Committed Amount has been terminated as provided herein);
provided, however, that (i) the sum of the aggregate amount of the Dollar
Equivalent amount of Loans outstanding plus the Dollar Equivalent amount of the aggregate
amount of LOC Obligations outstanding shall not exceed the Revolving Committed Amount, (ii)
with respect to each individual Lender, the Lender’s pro rata share of outstanding Loans
plus such Lender’s pro rata share of outstanding LOC Obligations shall not exceed such
Lender’s Commitment Percentage of the Revolving Committed Amount and (iii) the aggregate
amount of Loans denominated in Alternative Currencies shall not exceed the Alternative
Currency Sublimit. Subject to the terms of this Credit Agreement (including Section 3.3),
the Borrower may borrow, repay and reborrow Loans.





     (b) Method of Borrowing for Loans. By no later than 11:00 a.m. (i) on the date
of the requested borrowing of Loans that will be Base Rate Loans, (ii) three Business Days
prior to the date of the requested borrowing of Loans that will be Eurodollar Loans
denominated in Dollars or (iii) four Business Days prior to the requested date of any
borrowing or continuation of Eurodollar Loans denominated in Alternative Currencies, the
Borrower shall provide telephonic notice to the Administrative Agent, followed promptly by a
written Notice of Borrowing in the form of Exhibit 2.1(b) (which may be submitted by
telecopy), each of such telephonic notice and such written Notice of Borrowing setting forth
(A) the amount requested, (B) whether such Loans shall accrue interest at the Base Rate or
the Adjusted Eurodollar Rate, (C) with respect to Loans that will be Eurodollar Loans, the
Interest Period applicable thereto, (D) certification that the Borrower has complied in all
respects with Section 5.2 and (E) the currency of the Loans to be borrowed. If the Borrower
fails to specify a currency in a Notice of Borrowing, then the Loans so requested shall be
made in Dollars.



28









 






     (c) Funding of Loans. Upon receipt of a Notice of Borrowing, the
Administrative Agent shall promptly inform the Lenders as to the terms thereof. Each Lender
shall make its Commitment Percentage of the requested Loans available to the Administrative
Agent in Same Day Funds at the Agency Services Address for the applicable currency (i) not
later than 1:00 p.m., in the case of any Loan denominated in Dollars, and (ii) not later
than the Applicable Time specified by the Administrative Agent in the case of any Loan in an
Alternative Currency, in each case on the date specified in the Notice of Borrowing. The
amount of the requested Loans will then be made available to the Borrower or the Designated
Borrower by the Administrative Agent as directed by the Borrower, to the extent the amount
of such Loans are made available to the Administrative Agent.




     (d) Reductions of Revolving Committed Amount. Upon at least three Business
Days’ prior written notice, the Borrower shall have the right to permanently reduce, without
premium or penalty, all or part of the aggregate unused amount of the Revolving Committed
Amount at any time or from time to time; provided that (i) each partial reduction
shall be in an aggregate amount at least equal to $5,000,000 and in integral multiples of
$1,000,000 above such amount and (ii) no reduction shall be made which would reduce the
Revolving Committed Amount to an amount less than the Dollar Equivalent amount of aggregate
amount of outstanding Loans plus the Dollar Equivalent amount of the aggregate amount of
outstanding LOC Obligations. Any reduction in (or termination of) the Revolving Committed
Amount pursuant to this Section 2.1(d) shall be permanent and may not be reinstated. The
Administrative Agent shall immediately notify the Lenders of any reduction in the Revolving
Committed Amount pursuant to this Section 2.1(d).




     (e) Notes. The Loans made by each Lender shall be evidenced by a duly executed
promissory note of the Borrower to each Lender in substantially the form of Exhibit
2.1(e).



     2.2 Letter of Credit Subfacility.




     (a)
The Letter of Credit Commitment.




     (i) Subject to the terms and conditions set forth herein and other terms and
conditions that the Issuing Lender may reasonably require, (A) the Issuing Lender
agrees, in reliance upon the agreements of the Lenders set forth in this Section
2.2, from time to time on any Business Day during the period from the Closing Date
until the Letter of Credit Expiration Date, to issue standby Letters of Credit in
Dollars or in one or more Alternative Currencies for the account of the Borrower or,
subject to the terms of Section 2.2(j), certain Subsidiaries of the Borrower, and to
amend Letters of Credit previously issued by it, in each case in accordance with
subsection (b) below and (B) the Lenders severally agree to



29









 






participate in Letters
of Credit issued for the account of the Borrower or, subject to the terms of Section
2.2(j), certain Subsidiaries of the Borrower; provided, however,
that after giving effect to the issuance of any Letter of Credit (1) the sum of the
Dollar Equivalent amount of aggregate principal amount of outstanding Loans plus the
Dollar Equivalent amount of the aggregate principal amount of outstanding LOC
Obligations shall not exceed the Revolving Committed Amount, (2) with respect
to each individual Lender, the sum of the aggregate principal amount of outstanding
Loans of such Lender plus such Lender’s pro rata share of the aggregate amount of
LOC Obligations shall not exceed such Lender’s Commitment Percentage of the
Revolving Committed Amount and (3) the Dollar Equivalent of the aggregate principal
amount of outstanding LOC Obligations shall not at any time exceed the LOC Committed
Amount. Within the foregoing limits, and subject to the terms and conditions
hereof, the Borrower may, during the foregoing period, obtain Letters of Credit to
replace Letters of Credit that have expired or that have been drawn upon and
reimbursed.




     (ii) The Issuing Lender shall not issue or amend any Letter of Credit if:




     (A) any order, judgment or decree of any Governmental Authority or
arbitrator shall by its terms purport to enjoin or restrain the Issuing
Lender from issuing such Letter of Credit, or any Requirement of Law
applicable to the Issuing Lender or any request or directive (whether or not
having the force of law) from any Governmental Authority with jurisdiction
over the Issuing Lender shall prohibit, or request that the Issuing Lender
refrain from, the issuance of letters of credit generally or such Letter of
Credit in particular or shall impose upon the Issuing Lender with respect to
such Letter of Credit any restriction, reserve or capital requirement (for
which the Issuing Lender is not otherwise compensated hereunder) not in
effect on the Closing Date, or shall impose upon the Issuing Lender any
unreimbursed loss, cost or expense which was not applicable on the Closing
Date and which the Issuing Lender in good faith deems material to it;




     (B) the expiry date of such requested Letter of Credit would occur more
than twelve months after the date of issuance, unless the Required Lenders
have approved such expiry date;




     (C) the expiry date of such requested Letter of Credit would occur
after the Letter of Credit Expiration Date, unless all the Lenders have
approved such expiry date;




     (D) the issuance of such Letter of Credit would violate one or more
policies of the Issuing Lender;



30









 






     (E) a default of any Lender’s obligations to fund under Section 2.2(d)
exists or any Lender is at such time a Defaulting Lender hereunder, unless
the Issuing Lender has entered into satisfactory arrangements with the
Borrower or such Lender to eliminate the Issuing Lender’s risk with respect
to such Lender;




     (F) such Letter of Credit is in an initial amount less than $100,000
(unless otherwise agreed to by the Issuing Lender), is to be used for a
purpose other than as permitted by Section 7.10, or is denominated in a
currency other than Dollars;




     (G) except as otherwise agreed by the Administrative Agent and the
Issuing lender, such Letter of Credit is to be denominated in a currency
other than Dollars or an Alternative Currency; or




     (H) the Issuing Lender does not as of the issuance date of such
requested Letter of Credit issue Letters of Credit in the requested
currency.





     (iii) The Issuing Lender shall be under no obligation to amend any Letter of
Credit if (A) the Issuing Lender 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.




     (b) Procedures for Issuance and Amendment of Letters of Credit.




     (i) Each Letter of Credit shall be issued or amended, as the case may be, upon
the request of the Borrower delivered to the Issuing Lender (with a copy to the
Administrative Agent) in the form of a Letter of Credit Application, appropriately
completed and signed by a Authorized Officer of the Borrower. The Letter of Credit
Application must be received by the Issuing Lender and the Administrative Agent not
later than 11:00 a.m. at least two Business Days (or such later date and time as the
Issuing Lender may agree in a particular instance in its sole discretion) prior to
the proposed issuance date or date of amendment, as applicable. In the case of a
request for an initial issuance of a Letter of Credit, such Letter of Credit
Application shall specify in form and detail satisfactory to the Issuing Lender: (A)
the proposed issuance date of the requested Letter of Credit (which shall be a
Business Day), (B) the amount and currency thereof, (C) the expiry date thereof, (D)
the name and address of the beneficiary thereof, (E) the documents to be presented
by such beneficiary in case of any drawing thereunder, (F) the full text of any
certificate to be presented by such beneficiary in case of any drawing thereunder
and (G) such other matters as the Issuing



31









 






Lender may require. In the case of a
request for an amendment of any outstanding Letter of Credit, such Letter of Credit
Application shall specify in form and detail satisfactory to the Issuing Lender (1)
the Letter of Credit to be amended, (2) the proposed date of amendment thereof
(which shall be a Business Day), (3) the nature of the proposed amendment and (4)
such other matters as the Issuing Lender may require.




     (ii) Promptly after receipt of any Letter of Credit Application, the Issuing
Lender will confirm with the Administrative Agent (by telephone or in writing) that
the Administrative Agent has received a copy of such Letter of Credit Application
from the Borrower and, if not, the Issuing Lender will provide the Administrative
Agent with a copy thereof. Upon receipt by the Issuing Lender of confirmation from
the Administrative Agent that the requested issuance or amendment is permitted in
accordance with the terms hereof, then, subject to the terms and conditions hereof,
the Issuing Lender shall, on the requested date, issue a Letter of Credit for the
account of the Borrower or enter into the applicable amendment, as the case may be,
in each case in accordance with the Issuing Lender’s usual and customary business
practices.




     (iii) Promptly after its delivery of any Letter of Credit or any amendment to a
Letter of Credit to an advising bank with respect thereto or to the beneficiary
thereof, the Issuing Lender will also deliver to the Borrower and the Administrative
Agent a true and complete copy of such Letter of Credit or amendment.




     (c) Participations.




     (i) On the Closing Date, each Lender shall be deemed to have purchased without
recourse a risk participation from the Issuing Lender in each Existing Letter of
Credit and the obligations arising thereunder and any collateral relating thereto,
in each case in an amount equal to its Commitment Percentage of the obligations
under such Existing Letter of Credit and be obligated to pay to the Issuing Lender
therefor and discharge when due, its Commitment Percentage of the obligations
arising under such Existing Letter of Credit.




     (ii) Each Lender, upon issuance of a Letter of Credit, shall be deemed to have
purchased without recourse a risk participation from the Issuing Lender in such
Letter of Credit
and the obligations arising thereunder and any collateral relating thereto, in
each case in an amount equal to its Commitment Percentage of the obligations under
such Letter of Credit, and shall absolutely, unconditionally and irrevocably assume,
as primary obligor and not as surety, and be obligated to pay to the Issuing Lender
therefor and discharge when due, its Commitment Percentage of the obligations
arising under such Letter of Credit.



32









 






     (d) Reimbursement.




     (i) In the event of any drawing under any Letter of Credit, the Issuing Lender
will promptly notify the Borrower in writing. In the case of a Letter of Credit
denominated in an Alternative Currency, the Borrower shall reimburse the Issuing
Lender in such Alternative Currency, unless (A) the Issuing Lender (at its option)
shall have specified in such notice that it will require reimbursement in Dollars,
or (B) in the absence of any such requirement for reimbursement in Dollars, the
Borrower shall have notified the Issuing Lender promptly following receipt of the
notice of drawing that the Borrower will reimburse the Issuing Lender in Dollars.
In the case of any such reimbursement in Dollars of a drawing under a Letter of
Credit denominated in an Alternative Currency, the Issuing Lender shall notify the
Borrower of the Dollar Equivalent of the amount of the drawing promptly following
the determination thereof. The Borrower shall reimburse the Issuing Lender on the
day of drawing under any Letter of Credit either with the proceeds of a Loan
obtained hereunder or otherwise in immediately available funds in the applicable
currency. If the Borrower shall fail to reimburse the Issuing Lender as provided
hereinabove, the unreimbursed amount of such drawing shall bear interest at a per
annum rate equal to the Base Rate plus two percent (2%).




     (ii) Subsequent to a drawing under any Letter of Credit, unless the Borrower
shall immediately notify the Issuing Lender of its intent to otherwise reimburse the
Issuing Lender in the applicable currency, the Borrower shall be deemed to have
requested a Loan at the Base Rate in the amount of the drawing as described herein,
the proceeds of which will be used to satisfy the reimbursement obligations. On any
day on which the Borrower shall be deemed to have requested a Loan borrowing to
reimburse a drawing under a Letter of Credit, the Administrative Agent shall give
notice to the Lenders that a Loan (expressed in Dollars in the amount of the Dollar
Equivalent thereof in the case of a Letter of Credit denominated in an Alternative
Currency) has been deemed requested in connection with a drawing under a Letter of
Credit, in which case a Loan borrowing comprised solely of Base Rate Loans (each
such borrowing, a “Mandatory Borrowing”) shall be made from all Lenders in
Dollars (without giving effect to any termination of the Commitments pursuant to
Section 9.2 or otherwise) not later than 1:00 p.m. on the Business Day such notice
by the Administrative Agent is received if such notice is received before 12:00
Noon, otherwise such payment shall be made at or before 2:00 p.m. on the next
succeeding Business Day. Each Lender that so makes funds available shall be deemed
to have made a Base Rate Loan in Dollars to the Borrower in such amount. The
Administrative Agent shall remit the funds so received to the Issuing Lender in
Dollars pro rata based on each Lender’s respective Commitment



33









 






Percentage and the proceeds thereof shall be paid directly to the Issuing Lender for
application to the respective LOC Obligations. Each Lender hereby irrevocably
agrees to make such Loans immediately upon any such request or deemed request on
account of each such Mandatory Borrowing in the amount and in the manner specified
in the preceding sentence and on the same such date notwithstanding (A) any
setoff, counterclaim, recoupment, defense, or other right which such Lender may have
against the Issuing Lender, the Borrower or any other Person for any reason
whatsoever, (B) the amount of Mandatory Borrowing may not comply with the minimum
amount for borrowings of Loans otherwise required hereunder, (C) the failure of any
conditions specified in Section 5.2 to have been satisfied, (D) the existence of a
Default or an Event of Default, (E) the failure of any such request or deemed
request for Loans to be made by the time otherwise required hereunder, (F) the date
of
such Mandatory Borrowing, or (G) any reduction in the Revolving Committed
Amount or any termination of the Commitments. This Section 2.2(d)(ii) is subject to
the provisions of Section 2.2(d)(iii).




     (iii) In the event that any Mandatory Borrowing cannot for any reason be made
on the date otherwise required above (including, without limitation, as a result of
the commencement of a proceeding under the Bankruptcy Code with respect to the
Borrower or any other Credit Party), then each Lender hereby agrees that it shall
forthwith fund (as of the date the Mandatory Borrowing would otherwise have
occurred, but adjusted for any payments received from the Borrower on or after such
date and prior to such purchase) its Participation Interest in Dollars in the
outstanding LOC Obligations; provided, that in the event any Lender shall
fail to fund its Participation Interest on the day the Mandatory Borrowing would
otherwise have occurred, then the amount of such Lender’s unfunded Participation
Interest therein shall bear interest payable to the Issuing Lender upon demand, at
the rate equal to, if paid within two Business Days of such date, the applicable
Overnight Rate from time to time in effect, and thereafter at a rate equal to the
Base Rate. Simultaneously with the making of each such payment by a Lender to the
Issuing Lender, such Lender shall, automatically and without any further action on
the part of the Issuing Lender or such Lender, acquire a participation in an amount
equal to such payment (excluding the portion of such payment constituting interest
owing to the Issuing Lender) in the related unreimbursed drawing portion of the LOC
Obligation and in the interest thereon and shall have a claim against the Borrower
and the other Credit Parties with respect thereto. Any payment by the Lenders
pursuant to this clause (iii) shall not relieve or otherwise impair the obligations
of the Borrower or any Credit Party to reimburse the Issuing Lender under a Letter
of Credit.




     (iv) Until each Lender funds its Base Rate Loan or Participation Interest
pursuant to this Section 2.2(d) to reimburse the Issuing Lender for any



34









 






amount drawn
under any Letter of Credit, interest in respect of such Lender’s Applicable
Percentage of such amount shall be solely for the account of the Issuing Lender.




     (v) Notwithstanding anything in this Agreement to the contrary, to the extent
the conditions set forth in Section 5.2 cannot be satisfied, all Loans arising on a
Mandatory Borrowing shall be payable in full on the Business Day immediately
following the date of such Mandatory Borrowing.




     (e) Obligations Absolute. The obligation of the Borrower to reimburse the
Issuing Lender for each drawing under each Letter of Credit shall be absolute, unconditional
and irrevocable, and shall be paid strictly in accordance with the terms of this Credit
Agreement under all circumstances, including the following:




     (i) any lack of validity or enforceability of such Letter of Credit, this
Credit Agreement, or any other agreement or instrument relating thereto;




     (ii) the existence of any claim, counterclaim, set-off, defense or other right
that the Borrower may have at any time against any beneficiary or any transferee of
such Letter of Credit (or any Person for whom any such beneficiary or any such
transferee may be acting), the Issuing Lender or any other Person, whether in
connection with this Credit Agreement, the transactions contemplated hereby or by
such Letter of Credit or any agreement or instrument relating thereto, or any
unrelated transaction;




     (iii) any draft, demand, certificate or other document presented under such
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; or any loss or delay in the
transmission or otherwise of any document required in order to make a drawing under
such Letter of Credit;




     (iv) any payment by the Issuing Lender under such Letter of Credit against
presentation of a draft or certificate that does not strictly comply with the terms
of such Letter of Credit; or any payment made by the Issuing Lender under such
Letter of Credit to any Person purporting to be a trustee in bankruptcy,
debtor-in-possession, assignee for the benefit of creditors, liquidator, receiver or
other representative of or successor to any beneficiary or any transferee of such
Letter of Credit, including any arising in connection with any proceeding under any
Bankruptcy Code;




     (v) any adverse change in the relevant exchange rates or in the availability of
the relevant Alternative Currency to the Borrower or any Subsidiary or in the
relevant currency markets generally; or



35









 






     (vi) any other circumstance or happening whatsoever, whether or not similar to
any of the foregoing, including any other circumstance that might otherwise
constitute a defense available to, or a discharge of, the Borrower.




The Borrower shall promptly examine a copy of each Letter of Credit and each amendment
thereto that is delivered to it and, in the event of any claim of noncompliance with the
Borrower’s instructions or other irregularity, the Borrower will immediately notify the
Issuing Lender. The Borrower shall be conclusively deemed to have waived any such claim
against the Issuing Lender and its correspondents unless such notice is given as aforesaid.




     (f) Role of Issuing Lender. Each Lender and the Borrower agree that, in paying
any drawing under a Letter of Credit, the Issuing Lender shall not have any responsibility
to obtain any document (other than any sight draft, certificates and documents expressly
required by the Letter of Credit) or to ascertain or inquire as to the validity or accuracy
of any such document or the authority of the Person executing or delivering any such
document. None of the Issuing Lender, any Agent-Related Person nor any of the respective
correspondents, participants or assignees of the Issuing Lender shall be liable to any
Lender for (i) any action taken or omitted in connection herewith at the request or with the
approval of the Lenders or the Required Lenders, as applicable, (ii) any action taken or
omitted in the absence of gross negligence or willful misconduct or (iii) the due execution,
effectiveness, validity or enforceability of any document or instrument related to any
Letter of Credit or Letter of Credit Application. The Borrower hereby assumes all risks of
the acts or omissions of any beneficiary or transferee with respect to its use of any Letter
of Credit; provided, however, that this assumption is not intended to, and
shall not, preclude the Borrower’s pursuing such rights and remedies as it may have against
the beneficiary or transferee at law or under any other agreement. None of the Issuing
Lender, any Agent-Related Person, nor any of the respective correspondents, participants or
assignees of the Issuing Lender, shall be liable or responsible for any of the matters
described in clauses (i) through (v) of Section 2.2(e); provided, however, that anything in
such clauses to the contrary notwithstanding, the Borrower may have a claim against the
Issuing Lender, and the Issuing Lender may be liable to the Borrower, to the extent, but
only to the extent, of any direct, as opposed to consequential or exemplary, damages
suffered by the Borrower which the Borrower proves were caused by the Issuing Lender’s
willful misconduct or gross negligence or the Issuing Lender’s willful failure to pay under
any Letter of Credit after the presentation to it by the beneficiary of a sight draft and
certificate(s) strictly complying with the terms and conditions of a Letter of Credit. In
furtherance and not in limitation of the foregoing, the Issuing Lender may accept documents
that appear on their face to be in order, without responsibility for further investigation
and the Issuing Lender shall not be responsible for the validity or sufficiency of any
instrument transferring or assigning or purporting to



36









 






transfer or assign a Letter of Credit
or the rights or
benefits thereunder or proceeds thereof, in whole or in part, which may prove to be
invalid or ineffective for any reason.




     (g) Cash Collateral.




     (i) If, as of the Letter of Credit Expiration Date, any Letter of Credit for any reason
remains outstanding and partially or wholly undrawn, the Borrower shall immediately Cash
Collateralize the then aggregate principal amount of all LOC Obligations (in an amount equal
to such aggregate principal amount determined as of the Letter of Credit Expiration Date).




     (ii) In addition, if the Administrative Agent notifies the Borrower at any time that
the Dollar Equivalent amount of the aggregate outstanding amount of all LOC Obligations at
such time exceeds 105% of the Letter of Credit Sublimit then in effect, then, within two
Business Days after receipt of such notice, the Borrower shall Cash Collateralize the LOC
Obligations in an amount equal to the amount by which the outstanding amount of all LOC
Obligations exceeds the Letter of Credit Sublimit.




     (iii) The Administrative Agent may, at any time and from time to time after the initial
deposit of Cash Collateral, request that additional Cash Collateral be provided in order to
protect against the results of exchange rate fluctuations.




     The Borrower hereby grants to the Administrative Agent, for the benefit of the Issuing
Lender and the Lenders, a security interest in all such cash, deposit accounts and all
balances therein and all proceeds of the foregoing. Cash collateral shall be maintained in
blocked, non-interest bearing deposit accounts at Bank of America.




     (h) Applicability of ISP and UCP. Unless otherwise expressly agreed by the
Issuing Lender and the Borrower when a Letter of Credit is issued (including any such
agreement applicable to an Existing Letter of Credit), (i) the rules of the ISP shall apply
to each standby Letter of Credit, and (ii) the rules of the Uniform Customs and Practice for
Documentary Credits, as most recently published by the International Chamber of Commerce at
the time of issuance shall apply to each commercial Letter of Credit.




     (i) Conflict with Letter of Credit Application. In the event of any conflict
between the terms hereof and the terms of any Letter of Credit Application, the terms hereof
shall control.




     (j) Designation of Subsidiaries as Account Parties. Notwithstanding anything
to the contrary set forth in this Credit Agreement and any LOC Document, a Letter of Credit
issued hereunder may contain a statement to the effect that such Letter of Credit is issued
for the account of a Subsidiary of the Borrower; provided that notwithstanding such
statement, the Borrower shall be the actual account party for all purposes of this



37









 






Credit
Agreement for such Letter of Credit and such statement shall not affect the Borrower’s
reimbursement obligations hereunder with respect to such Letter of Credit.




     (k) Indemnification of Issuing Lender.




     (i) In addition to its other obligations under this Credit Agreement, the
Credit Parties hereby agree to protect, indemnify, pay and hold the Issuing Lender
harmless from and against any and all claims, demands, liabilities, damages, losses,
costs, charges and expenses (including reasonable Attorney Costs) that the Issuing
Lender may incur or be subject to as a consequence, direct or indirect, of (A) the
issuance of any Letter of Credit or (B) the failure of the Issuing Lender to honor a
drawing under a Letter of Credit as a result of any act or omission,
whether rightful or wrongful, of any present or future de jure or de facto
government or Governmental Authority (all such acts or omissions, herein called
“Government Acts”).




     (ii) As between the Credit Parties and the Issuing Lender, the Credit Parties
shall assume all risks of the acts, omissions or misuse of any Letter of Credit by
the beneficiary thereof. In the absence of gross negligence or willful misconduct,
the Issuing Lender shall not be responsible for: (A) the form, validity,
sufficiency, accuracy, genuineness or legal effect of any document submitted by any
party in connection with the application for and issuance of any Letter of Credit,
even if it should in fact prove to be in any or all respects invalid, insufficient,
inaccurate, fraudulent or forged; (B) the validity or sufficiency of any instrument
transferring or assigning or purporting to transfer or assign any Letter of Credit
or the rights or benefits thereunder or proceeds thereof, in whole or in part, that
may prove to be invalid or ineffective for any reason; (C) failure of the
beneficiary of a Letter of Credit to comply fully with conditions required in order
to draw upon a Letter of Credit; (D) errors, omissions, interruptions or delays in
transmission or delivery of any messages, by mail, cable, telegraph, telex or
otherwise, whether or not they be in cipher; (E) errors in interpretation of
technical terms; (F) any loss or delay in the transmission or otherwise of any
document required in order to make a drawing under a Letter of Credit or of the
proceeds thereof; and (G) any consequences arising from causes beyond the control of
the Issuing Lender, including, without limitation, any Government Acts. None of the
above shall affect, impair, or prevent the vesting of the Issuing Lender’s rights or
powers hereunder.




     (iii) In furtherance and extension and not in limitation of the specific
provisions hereinabove set forth, any action taken or omitted by the Issuing Lender,
under or in connection with any Letter of Credit or the related certificates, if
taken or omitted in good faith, shall not put the Issuing Lender under any resulting
liability to the Borrower or any other Credit Party. It is the
intention of



38









 






 the
parties that this Credit Agreement shall be construed and applied to protect and
indemnify the Issuing Lender against any and all risks involved in the issuance of
the Letters of Credit, all of which risks are hereby assumed by the Credit Parties,
including, without limitation, any and all risks of the acts or omissions, whether
rightful or wrongful, of any present or future Government Acts. The Issuing Lender
shall not, in any way, be liable for any failure by the Issuing Lender or anyone
else to pay any drawing under any Letter of Credit as a result of any Government
Acts or any other cause beyond the control of the Issuing Lender.




     (iv) Nothing in this subsection (k) is intended to limit the reimbursement
obligation of the Credit Parties contained in this Section 2.2. The obligations of
the Credit Parties under this subsection (k) shall survive the termination of this
Credit Agreement. No act or omission of any current or prior beneficiary of a
Letter of Credit shall in any way affect or impair the rights of the Issuing Lender
to enforce any right, power or benefit under this Credit Agreement.




     (l) Letter of Credit Amounts. Unless otherwise specified, all references
herein to the amount of a Letter of Credit at any time shall be deemed to mean the maximum
face amount of such Letter of Credit after giving effect to all increases thereof
contemplated by such Letter of Credit or the Letter of Credit Application therefor, whether
or not such maximum face amount is in effect at such time.



     2.3 Continuations and Conversions.



     Subject to the terms below, the Borrower shall have the option, on any Business Day, to
continue existing Eurodollar Loans for a subsequent Interest Period, to convert Base Rate Loans
into Eurodollar Loans or to convert Eurodollar Loans into Base Rate Loans. By no later than 11:00
a.m. (a) on the date of the requested conversion of a Eurodollar Loan to a Base Rate Loan, (b)
three Business Days prior to the date of the requested continuation of a Eurodollar Loan
denominated in Dollars or conversion of a Base Rate Loan to a Eurodollar Loan denominated in
Dollars
or (c) four Business Days prior to the requested date of any borrowing or continuation of
Eurodollar Loans denominated in Alternative Currencies, the Borrower shall provide telephonic
notice to the Administrative Agent, followed promptly by a written Notice of
Continuation/Conversion, in the form of Exhibit 2.3 setting forth (i) whether the Borrower
wishes to continue or convert such Loans and (ii) if the request is to continue a Eurodollar Loan
or convert a Base Rate Loan to a Eurodollar Loan, the Interest Period applicable thereto;
provided, however, that in the case of a failure to timely request a continuation
of Loans denominated in an Alternative Currency, such Loans shall be continued as Eurodollar Loans
in their original currency with an Interest Period of one month. Notwithstanding anything herein
to the contrary, (A) except as provided in Section 3.11, Eurodollar Loans may only be continued or
converted into Base Rate Loans on the last day of the Interest Period applicable thereto, (B)
Eurodollar Loans may not be continued nor may Base Rate Loans be converted into Eurodollar Loans
during the existence and continuation of a Default or an



39









 




Event of Default (and the Required Lenders
may demand that any or all of the then outstanding Eurodollar Loans denominated in an Alternative
Currency be redenominated into Dollars in the amount of the Dollar Equivalent thereof on the last
day of the then current Interest Period with respect thereto) and (C) any request to continue a
Eurodollar Loan that fails to comply with the terms hereof or any failure to request a continuation
of a Eurodollar Loan at the end of an Interest Period shall constitute a conversion to a Base Rate
Loan on the last day of the applicable Interest Period. No Loan may be converted into or continued
as a Loan denominated in a different currency, but instead must be prepaid in the original currency
of such Loan and reborrowed in the other currency.




     2.4 Minimum Amounts.



     Each request for a borrowing, conversion or continuation shall be subject to the requirements
that (a) each Eurodollar Loan shall be in a minimum amount of $5,000,000 and in integral multiples
of $1,000,000 in excess thereof, (b) each Base Rate Loan shall be in a minimum amount of the lesser
of $1,000,000 (and integral multiples of $1,000,000 in excess thereof) or the remaining amount
available under the Revolving Committed Amount and (c) no more than ten (10) Eurodollar Loans shall
be outstanding hereunder at any one time. For the purposes of this Section 2.4, all Eurodollar
Loans with the same Interest Periods that begin and end on the same date shall be considered as one
Eurodollar Loan, but Eurodollar Loans with different Interest Periods, even if they begin on the
same date, shall be considered as separate Eurodollar Loans.



SECTION 3




GENERAL PROVISIONS APPLICABLE TO LOANS AND LETTERS OF CREDIT



     3.1 Interest.




     (a) Interest Rate. Subject to Section 3.1(b), all Base Rate Loans shall accrue
interest at the Base Rate and all Eurodollar Loans shall accrue interest at the Adjusted
Eurodollar Rate plus (in the case of a Eurodollar Loan which is lent from a Lending
Office in the United Kingdom or a Participating Member State) the Mandatory Cost.




     (b) Default Rate of Interest.




     (i) Upon the occurrence, and during the continuation, of an Event of Default pursuant
to Section 9.1(a), the principal of and, to the extent permitted by law, interest on the
Loans and any other amounts owing hereunder or under the other Credit Documents (including
without limitation fees and expenses) shall bear interest, payable on demand, at a per annum
rate equal to 2% plus the rate which would otherwise be applicable (or if no rate is
applicable, then the Base Rate plus two percent (2%) per annum).



40









 






     (ii) Upon the occurrence, and during the continuation, of an Event of Default (other
than pursuant to Section 9.1(a)), then upon the request of the Required Lenders, the
principal of and, to the extent permitted by law, interest on the Loans and any other
amounts owing hereunder or under the other Credit
Documents (including without limitation fees and expenses) shall bear interest, payable on
demand, at a per annum rate equal to 2% plus the rate which would otherwise be applicable
(or if no rate is applicable, then the Base Rate plus two percent (2%) per annum).




     (c) Interest Payments. Interest on Loans shall be due and payable in arrears
on each Interest Payment Date. If an Interest Payment Date falls on a date which is not a
Business Day, such Interest Payment Date shall be deemed to be the next succeeding Business
Day, except that in the case of Eurodollar Loans where the next succeeding Business Day
falls in the next succeeding calendar month, then on the next preceding Business Day.



     3.2 Place and Manner of Payments.



     (a) All payments of principal, interest, fees, expenses and other amounts to be made by a
Credit Party under this Credit Agreement shall be made unconditionally and without any setoff,
deduction, counterclaim, defense, recoupment or withholding of any kind and received not later than
2:00 p.m. on the date when due, in Dollars (except with respect to principal of and interest on
Loans denominated in an Alternative Currency) and in Same Day Funds, to the Administrative Agent at
the Agency Services Address. Except as otherwise expressly provided herein, all payments by the
Borrowers hereunder with respect to principal and interest on Loans denominated in an Alternative
Currency shall be made to the Administrative Agent, for the account of the respective Lenders to
which such payment is owed, at the applicable Agency Services Address in such Alternative Currency
and in Same Day Funds not later than the Applicable Time specified by the Administrative Agent on
the dates specified herein. Without limiting the generality of the foregoing, the Administrative
Agent may require that any payments due under this Credit Agreement be made in the United States.
If, for any reason, any Borrower is prohibited by any Law from making any required payment
hereunder in an Alternative Currency, such Borrower shall make such payment in Dollars in the
Dollar Equivalent of the Alternative Currency payment amount. Payments received after
such time shall be deemed to have been received on the next Business Day and additional interest
shall accrue and be payable for such additional period. The Borrower shall, at the time it makes
any payment under this Credit Agreement, specify to the Administrative Agent the Loans, Letters of
Credit, fees or other amounts payable by the Borrower hereunder to which such payment is to be
applied (and in the event that it fails to specify, or if such application would be inconsistent
with the terms hereof, the Administrative Agent shall, subject to Section 3.7, distribute such
payment to the Lenders in such manner as the Administrative Agent may reasonably deem appropriate).
The Administrative Agent will distribute such payments to the Lenders on the same Business Day if
any such payment is received (i) at or before 2:00 p.m., in the case of payments in Dollars or (ii)
at or before the Applicable Time specified by the Administrative Agent in the case of payments in
an Alternative



41









 




Currency, otherwise the Administrative Agent will distribute such payment to the
Lenders on the next succeeding Business Day. Whenever any payment hereunder shall be stated to be
due on a day which is not a Business Day, the due date thereof shall be extended to the next
succeeding Business Day (subject to accrual of interest and fees for the period of such extension),
except that, in the case of Eurodollar Loans, if the extension would cause the payment to be made
in the next following calendar month, then such payment shall instead be made on the next preceding
Business Day.




     (b) Unless the Borrower or any Lender has notified the Administrative Agent, prior to the time
any payment is required to be made by it to the Administrative Agent hereunder, that the Borrower
or such Lender, as the case may be, will not make such payment, the Administrative Agent may assume
that the Borrower or such Lender, as the case may be, has timely made such payment and may (but
shall not be so required to), in reliance thereon, make available a corresponding amount to the
Person entitled thereto. If and to the extent that such payment was not in fact made to the
Administrative Agent in Same Day Funds, then:




     (i) if the Borrower failed to make such payment, each Lender shall forthwith on demand
repay to the Administrative Agent the portion of such assumed payment that was made
available to such Lender in Same Day Funds, together with interest thereon in respect of
each day from and including the date such amount was made available by the Administrative
Agent to such Lender to the date such
amount is repaid to the Administrative Agent in Same Day Funds at the Federal Funds Rate
from time to time in effect; and




     (ii) if any Lender failed to make such payment, such Lender shall forthwith on demand
pay to the Administrative Agent the amount thereof in immediately available funds, together
with interest thereon for the period from the date such amount was made available by the
Administrative Agent to the Borrower to the date such amount is recovered by the
Administrative Agent (the “Compensation Period”) at a rate per annum equal to the
Overnight Rate from time to time in effect. If such Lender pays such amount to the
Administrative Agent, then such amount shall constitute such Lender’s Loan included in the
applicable Borrowing. If such Lender does not pay such amount forthwith upon the
Administrative Agent’s demand therefor, the Administrative Agent may make a demand therefor
upon the Borrower, and the Borrower shall pay such amount to the Administrative Agent,
together with interest thereon for the Compensation Period at a rate per annum equal to the
rate of interest applicable to the applicable Borrowing. Nothing herein shall be deemed to
relieve any Lender from its obligation to fulfill its Commitment or to prejudice any rights
which the Administrative Agent or the Borrower may have against any Lender as a result of
any default by such Lender hereunder.


A notice of the Administrative Agent to any Lender or the Borrower with respect to any amount owing
under this subsection (b) shall be conclusive, absent manifest error.





42









 








     (c) If any Lender makes available to the Administrative Agent funds for any Loan to be made by
such Lender as provided in the foregoing provisions of this Section 3.2, and such funds are not
made available to the Borrower by the Administrative Agent because the conditions to the applicable
Extension of Credit set forth in Section 2.1 are not satisfied or waived in accordance with the
terms hereof, the Administrative Agent shall return such funds (in like funds as received from such
Lender) to such Lender, without interest, without prejudice to such Lender’s rights against the
Borrower under Section 3.14(b).



     (d) The obligations of the Lenders hereunder to make Loans and to fund participations in
Letters of Credit are several and not joint. The failure of any Lender to make any Loan or to fund
any such participation on any date required hereunder shall not relieve any other Lender of its
corresponding obligation to do so on such date, and no Lender shall be responsible for the failure
of any other Lender to so make its Loan or purchase its participation.



     (e) Nothing herein shall be deemed to obligate any Lender to obtain the funds for any Loan in
any particular place or manner or to constitute a representation by any Lender that it has obtained
or will obtain the funds for any Loan in any particular place or manner.



     3.3 Prepayments.




     (a) Voluntary Prepayments. The Borrower shall have the right to prepay Loans
in whole or in part from time to time without premium or penalty; provided,
however, that (i) Eurodollar Loans denominated in Dollars may only be prepaid on
three Business Days’ prior written notice to the Administrative Agent and any prepayment of
Eurodollar Loans denominated in Dollars will be subject to Section 3.14, (ii) Eurodollar
Loans denominated in Alternative Currencies may only be prepaid on three Business Days’
prior written notice to the Administrative Agent and any prepayment of Eurodollar Loans
denominated in Alternative Currencies will be subject to Section 3.14, (iii) each partial
prepayment of Eurodollar Loans denominated in Dollars shall be in the minimum principal
amount of $5,000,000 and integral multiples of $1,000,000, (iv) each partial prepayment of
Eurodollar Loans denominated in Alternative Currencies shall be in the minimum principal
amount of $5,000,000 and integral multiples of $1,000,000 and (v) each such partial
prepayment of Base Rate Loans shall be in the minimum principal amount of $1,000,000 and
integral multiples of $1,000,000. Amounts prepaid pursuant to this Section 3.3(a) shall be
applied as the Borrower may elect; however, if the Borrower fails to specify, such
prepayment will be applied in the manner set forth in Section 3.3(c) below.




     (b) Mandatory Prepayments.




     (i) If at any time the sum of the Dollar Equivalent amount of the aggregate amount of
Loans outstanding plus the Dollar Equivalent amount of all LOC Obligations outstanding
exceeds the Revolving Committed Amount, the Borrower shall immediately make a principal
payment to the Administrative Agent in the manner and in an amount such



43









 






that the sum of the
aggregate amount of Loans outstanding plus LOC Obligations outstanding is less than or equal
to the Revolving Committed Amount.




     (ii) If the Administrative Agent notifies the Borrower at any time that the aggregate
amount of Loans denominated in Alternative Currencies outstanding plus LOC Obligations
denominated in Alternative Currencies at such time exceeds an amount equal to 105% of the
Alternative Currency Sublimit then in effect, then, within two Business Days after receipt
of such notice, the Borrowers shall prepay Loans in an aggregate amount sufficient to reduce
such outstanding amount as of such date of payment to an amount not to exceed 100% of the
Alternative Currency Sublimit then in effect.




     (c) Application of Prepayments. All amounts paid pursuant to Section 3.3(a),
if the Borrower has not otherwise elected an application of such amounts, and all amounts
required to be prepaid pursuant to Section 3.3(b) shall be applied first to Loans
and second to a cash collateral account in respect of LOC Obligations. Within the
parameters of the applications set forth above, prepayments shall be applied first to Base
Rate Loans and then to Eurodollar Loans in direct order of Interest Period maturities. All
prepayments hereunder shall be subject to Section 3.14.



     3.4 Fees.




     (a) Facility Fees. In consideration of the Revolving Committed Amount being
made available by the Lenders hereunder, the Borrower agrees to pay to the Administrative
Agent, for the pro rata benefit of each Lender (based on such Lender’s Commitment Percentage
of the Revolving Committed Amount), a per annum fee in Dollars equal to the Applicable
Percentage for Facility Fees (the “Facility Fees”). The Facility Fees shall
commence to accrue on the Closing Date and shall be due and payable in arrears on the last
Business Day of each fiscal quarter of the Borrower (as well as on the Maturity Date and on
any date that the Revolving Committed Amount is reduced) for the immediately preceding
fiscal quarter (or portion thereof), beginning with the first of such dates to occur after
the Closing Date.




     (b) Utilization Fees.




     (i) For each day that Total Utilization exceeds an amount equal to fifty
percent (50%) of the Revolving Committed Amount, the Borrower shall pay to the
Administrative Agent, for the pro rata benefit of each Lender (based on such
Lender’s Commitment Percentage), a per annum fee in Dollars equal to (A) .125%
multiplied by (B) the sum of the principal amount of Loans outstanding on such day
plus the principal amount of LOC Obligations outstanding on such day (the
“Utilization Fees”).



44









 






     (ii) The Utilization Fees, if any, shall commence to accrue on the Closing Date
and shall be due and payable in arrears on the last Business Day of each fiscal
quarter of the Borrower (as well as on the Maturity Date and on any date that the
Revolving Committed Amount is reduced) for the immediately preceding fiscal quarter
(or portion thereof), beginning with the first of such dates to occur after the
Closing Date.




     (c) Letter of Credit Fees.




     (i) Letter of Credit Fees. In consideration of the issuance of Letters
of Credit hereunder, the Borrower agrees to pay to the Administrative Agent, for the
pro rata benefit of each Lender (based
on each Lender’s Commitment Percentage), a per annum fee (the “Letter of Credit
Fees”) equal to the Applicable Percentage for the Letter of Credit Fees on the
average daily maximum amount available to be drawn under each such Letter of Credit
from the date of issuance to the date of expiration. The Letter of Credit Fees will
be payable in arrears on the last Business Day of each fiscal quarter of the
Borrower (as well as on the Maturity Date) for the immediately preceding fiscal
quarter (or portion thereof), beginning with the first of such dates to occur after
the Closing Date.




     (ii) Issuing Lender Fees. The Borrower shall pay directly to the
Issuing Lender for its own account a fronting fee in Dollars with respect to each
Letter of Credit in an amount equal to 0.125% times the Dollar Equivalent of
the daily maximum amount available to be drawn under such Letter of Credit (the
“L/C Fronting Fee”). The L/C Fronting Fee shall be computed on a quarterly
basis in arrears and shall be due and payable on the last Business Day of each
fiscal quarter of the Borrower (as well as on the Letter of Credit Expiration Date)
for the fiscal quarter (or portion thereof) then ending, beginning with the first of
such dates to occur after the issuance of such Letter of Credit. In addition, the
Borrower shall pay directly to the Issuing Lender for its own account, in Dollars,
the customary issuance, presentation, amendment and other processing fees, and other
standard costs and charges, of the Issuing Lender relating to letters of credit as
from time to time in effect. Such customary fees and standard costs and charges are
due and payable on demand and are nonrefundable.




     (d) Other Fees. The Borrower agrees to pay (i) to the Administrative Agent,
for its own account, an annual fee and (ii) to the Administrative Agent, for the account of
each of the Lenders, upfront fees on the Closing Date, in each case in accordance with the
terms of the Fee Letter.



45









 





     3.5 Payment in full at Maturity.



     On the Maturity Date, the entire outstanding principal balance of all Loans and all LOC
Obligations, together with accrued but unpaid interest and all other sums owing with respect
thereto, shall be due and payable in full, unless accelerated sooner pursuant to Section 9.



     3.6 Computations of Interest and Fees.




     (a) Except for Base Rate Loans that are based upon the Prime Rate, in which case
interest shall be computed on the basis of the actual number of days elapsed over a year of
365 or 366 days, as the case may be, all computations of interest and fees hereunder shall
be made on the basis of the actual number of days elapsed over a year of 360 days, or, in
the case of interest in respect of Loans denominated in Alternative Currencies as to which
market practice differs from the foregoing, in accordance with such market practice.
Interest shall accrue from and include the date of borrowing (or continuation or conversion)
but exclude the date of payment.




     (b) It is the intent of the Lenders and the Credit Parties to conform to and contract
in strict compliance with applicable usury law from time to time in effect. All agreements
between the Lenders and the Credit Parties are hereby limited by the provisions of this
paragraph which shall override and control all such agreements, whether now existing or
hereafter arising and whether written or oral. In no way, nor in any event or contingency
(including but not limited to prepayment or acceleration of the maturity of any obligation),
shall the interest taken, reserved, contracted for, charged, or received under this Credit
Agreement, under the Notes or otherwise, exceed the maximum nonusurious amount permissible
under applicable law. If, from any possible construction of any of the Credit Documents or
any other document, interest would otherwise be payable in excess of the maximum nonusurious
amount, any such construction shall be subject to the provisions of this paragraph and such
documents shall be automatically reduced to the maximum nonusurious amount permitted under
applicable law, without the necessity of execution of any amendment or new document. If any
Lender shall ever receive anything of value which is characterized as interest on the Loans
under applicable law and
which would, apart from this provision, be in excess of the maximum nonusurious amount, an
amount equal to the amount which would have been excessive interest shall, without penalty,
be applied to the reduction of the principal amount owing on the Loans and not to the
payment of interest, or refunded to the Borrower or the other payor thereof if and to the
extent such amount which would have been excessive exceeds such unpaid principal amount of
the Loans. The right to demand payment of the Loans or any other Indebtedness evidenced by
any of the Credit Documents does not include the right to accelerate the payment of any
interest which has not otherwise accrued on the date of such demand, and the Lenders do not
intend to charge or receive any unearned interest in the event of such demand. All interest
paid or agreed to be paid to the Lenders with respect to the Loans shall, to the extent
permitted by applicable law, be amortized, prorated, allocated, and spread throughout the
full stated term (including



46









 






any renewal or extension) of the Loans so that the amount of
interest on account of such Indebtedness does not exceed the maximum nonusurious amount
permitted by applicable law.



     3.7
Pro Rata Treatment.




Except to the extent otherwise provided herein:




     (a) Loans. Each Loan borrowing (including, without limitation, each Mandatory
Borrowing), each payment or prepayment of principal of any Loan, each payment of fees (other
than the Issuing Lender Fees retained by the Issuing Lender for its own account and the fees
retained by the Administrative Agent for its own account), each reduction of the Revolving
Committed Amount, and each conversion or continuation of any Loan, shall (except as
otherwise provided in Section 3.11) be allocated pro rata among the relevant Lenders in
accordance with the respective Commitment Percentages of such Lenders (or, if the
Commitments of such Lenders have expired or been terminated, in accordance with the
respective principal amounts of the outstanding Loans and Participation Interests of such
Lenders); provided that, if any Lender shall have failed to pay its applicable pro
rata share of any Loan, then any amount to which such Lender would otherwise be entitled
pursuant to this subsection (a) shall instead be payable to the Administrative Agent until
the share of such Loan not funded by such Lender has been repaid; provided
further, that in the event any amount paid to any Lender pursuant to this subsection
(a) is rescinded or must otherwise be returned by the Administrative Agent, each Lender
shall, upon the request of the Administrative Agent, repay to the Administrative Agent the
amount so paid to such Lender, with interest for the period commencing on the date such
payment is returned by the Administrative Agent until the date the Administrative Agent
receives such repayment at a rate per annum equal to, during the period to but excluding the
date two Business Days after such request, the Federal Funds Rate, and thereafter, the Base
Rate plus two percent (2%) per annum; and




     (b) Letters of Credit. Each payment of unreimbursed drawings in respect of LOC
Obligations shall be allocated to each Lender pro rata in accordance with its Commitment
Percentage; provided that, if any Lender shall have failed to pay its applicable pro
rata share of any drawing under any Letter of Credit, then any amount to which such Lender
would otherwise be entitled pursuant to this subsection (b) shall instead be payable to the
Issuing Lender until the share of such unreimbursed drawing not funded by such Lender has
been repaid; provided further, that in the event any amount paid to any
Lender pursuant to this subsection (b) is rescinded or must otherwise be returned by the
Issuing Lender, each Lender shall, upon the request of the Issuing Lender, repay to the
Administrative Agent for the account of the Issuing Lender the amount so paid to such
Lender, with interest for the period commencing on the date such payment is returned by the
Issuing Lender until the date the Issuing Lender receives such repayment at a rate per annum



47









 






equal to, during the period to but excluding the date two Business Days after such request,
the Federal Funds Rate, and thereafter, the Base Rate plus two percent (2%) per
annum.



     3.8 Sharing of Payments.



     The Lenders agree among themselves that, except to the extent otherwise provided herein, in
the event that any Lender shall obtain payment in respect of any Loan, unreimbursed drawing with
respect to any LOC Obligations or any
other obligation owing to such Lender under this Credit Agreement through the exercise of a right
of setoff, banker’s lien or counterclaim, or pursuant to a secured claim under Section 506 of the
Bankruptcy Code or other security or interest arising from, or in lieu of, such secured claim,
received by such Lender under any applicable bankruptcy, insolvency or other similar law or
otherwise, or by any other means, in excess of its pro rata share of such payment as provided for
in this Credit Agreement, such Lender shall promptly pay in cash or purchase from the other Lenders
a participation in such Loans, LOC Obligations, and other obligations in such amounts, and make
such other adjustments from time to time, as shall be equitable to the end that all Lenders share
such payment in accordance with their respective ratable shares as provided for in this Credit
Agreement. The Lenders further agree among themselves that if payment to a Lender obtained by such
Lender through the exercise of a right of setoff, banker’s lien, counterclaim or other event as
aforesaid shall be rescinded or must otherwise be restored, each Lender which shall have shared the
benefit of such payment shall, by payment in cash or a repurchase of a participation theretofore
sold, return its share of that benefit (together with its share of any accrued interest payable
with respect thereto) to each Lender whose payment shall have been rescinded or otherwise restored.
The Borrower agrees that any Lender so purchasing such a participation may, to the fullest extent
permitted by law, exercise all rights of payment, including setoff, banker’s lien or counterclaim,
with respect to such participation as fully as if such Lender were a holder of such Loan, LOC
Obligation or other obligation in the amount of such participation. Except as otherwise expressly
provided in this Credit Agreement, if any Lender or the Administrative Agent shall fail to remit to
any other Lender an amount payable by such Lender or the Administrative Agent to such other Lender
pursuant to this Credit Agreement on the date when such amount is due, such payments shall be made
together with interest thereon for each date from the date such amount is due until the date such
amount is paid to the Administrative Agent or such other Lender at a rate per annum equal to the
Federal Funds Rate. If under any applicable bankruptcy, insolvency or other similar law, any
Lender receives a secured claim in lieu of a setoff to which this Section 3.8 applies, such Lender
shall, to the extent practicable, exercise its rights in respect of such secured claim in a manner
consistent with the rights of the Lenders under this Section 3.8 to share in the benefits of any
recovery on such secured claim.



     3.9 Capital Adequacy.




     (a) If, after the date thereof, the adoption or the becoming effective of, or any
change in, any law, rule or regulation or other Requirement of Law regarding capital
adequacy or any change therein or in the interpretation thereof, or compliance by any Lender
(or its Lending Office) therewith, has or would have the effect of reducing the rate



48









 






of
return on the capital or assets of such Lender or any corporation controlling such Lender as
a consequence of such Lender’s obligations hereunder (taking into consideration its policies
with respect to capital adequacy and such Lender’s desired return on capital), then from
time to time within 10 days of demand of such Lender setting forth in reasonable detail such
change in law and the calculation of such reduced rate of return (with a copy of such demand
to the Administrative Agent), the Borrower shall pay to such Lender such additional amounts
as will compensate such Lender for such reduction.




     (b) The Borrower shall not be required to compensate a Lender pursuant to this Section
3.9 for any additional amounts incurred more than 180 days prior to the date that such
Lender notifies the Borrower of the change in law giving rise to such additional amounts and
of such Lender’s intention to claim compensation therefor.




     (c) The Borrower shall pay to each Lender, as long as such Lender shall be required to
comply with any reserve ratio requirement or analogous requirement of any central banking or
financial regulatory authority imposed in respect of the maintenance of the Commitments or
the funding of the Eurodollar Loans, such additional costs (expressed as a percentage per
annum and rounded upwards, if necessary, to the nearest five decimal places) equal to the
actual costs allocated to such Commitment or Loan by such Lender (as determined by such
Lender in good faith, which determination shall be conclusive), which shall be due and
payable on each date on which interest is payable on such Loan, provided the
Borrower shall have received at least 10 days’ prior notice (with a copy to the
Administrative Agent) of such additional costs from such Lender. If a Lender fails to give
notice 10 days prior to the
relevant Interest Payment Date, such additional costs shall be due and payable 10 days
from receipt of such notice.



     3.10 Inability To Determine Interest Rate.



     If the Administrative Agent determines (which determination shall be conclusive and binding
upon the Borrower) in connection with any request for a Eurodollar Loan or a conversion to or
continuation thereof that (a) deposits (whether in Dollars or an Alternative Currency) are not
being offered to banks in the applicable offshore market for such currency for the applicable
amount and Interest Period of such Eurodollar Loan, (b) adequate and reasonable means do not exist
for determining the Eurodollar Rate for such Eurodollar Loan, or (c) the Eurodollar Rate for such
Eurodollar Loan does not adequately and fairly reflect the cost to the Lenders of funding such
Eurodollar Loan (whether denominated in Dollars or an Alternative Currency), the Administrative
Agent will promptly notify the Borrower and all the Lenders. Thereafter, the obligation of the
Lenders to make or maintain Eurodollar Loans in the affected currency or currencies shall be
suspended until the Administrative Agent revokes such notice. Upon receipt of such notice, the
Borrower may revoke any pending Notice of Borrowing or Notice of Continuation/Conversion with
respect to Eurodollar Loans in the affected currency or currencies or, failing that, will be deemed
to have converted such request into a request for a borrowing of



49









 




or conversion into a Base Rate
Loan in the amount specified therein. The Administrative Agent will withdraw such determination
pursuant to this Section 3.10 promptly as circumstances allow and no such suspension shall affect
the Eurodollar Rate for any Eurodollar Loan outstanding at the time such suspension is imposed.




     3.11 Illegality.



     If any Requirement of Law has made it unlawful, or that any Governmental Authority has
asserted that it is unlawful, for any Lender or its applicable Lending Office to make, maintain or
fund Eurodollar Loans (whether denominated in Dollars or an Alternative Currency), then, on notice
thereof by such Lender to the Borrower through the Administrative Agent, any obligation of such
Lender to make or continue Eurodollar Loans in the affected currency or currencies or, in the case
of Eurodollar Loans in Dollars, to convert Base Rate Loans to Eurodollar Loans shall be suspended
until such Lender notifies the Administrative Agent and the Borrower that the circumstances giving
rise to such determination no longer exist. Upon receipt of such notice, the Borrower shall, upon
demand from such Lender (with a copy to the Administrative Agent), prepay or, if applicable,
convert all Eurodollar Loans (in Dollars) of such Lender to Base Rate Loans, either on the last day
of the Interest Period thereof, if such Lender may lawfully continue to maintain such Eurodollar
Loans to such day, or immediately, if such Lender may not lawfully continue to maintain such
Eurodollar Loans. Upon any such conversion, the Borrower shall also pay interest on the amount so
converted, together with any amounts due with respect thereto pursuant to Section 3.14. Each
Lender agrees to designate a different Lending Office if such designation will avoid the need for
such notice and will not, in the good faith judgment of such Lender, otherwise be materially
disadvantageous to such Lender.



     3.12 Requirements of Law.




     (a) If, after the date hereof, as a result of the introduction of or any change in, or
in the interpretation of, any Requirement of Law, or a Lender’s compliance therewith, there
shall be any increase in the cost to such Lender of agreeing to make or making, funding or
maintaining Eurodollar Loans or (as the case may be) issuing or participating in Letters of
Credit, or a reduction in the amount received or receivable by such Lender in connection
with any of the foregoing (excluding for purposes of this subsection (a) any such increased
costs or reduction in amount resulting from (i) Taxes or Other Taxes (as to which Section
3.13 shall govern), (ii) reserve requirements utilized in the determination of the
Eurodollar Rate and (iii) the requirements of the Bank of England and the Financial Services
Authority or the European Central Bank reflected in the Mandatory Cost, other than as set
forth below), then from time to time, within 10 days of demand of such Lender (with a copy
of such demand to the Administrative Agent), the Borrower shall pay to such Lender such
additional amounts as will compensate such Lender
for such increased cost or reduction in yield. For purposes of this Section, the
Mandatory Cost, as calculated hereunder, does not represent the cost to any Lender of
complying with the requirements



50









 






of the Bank of England and/or the Financial Services
Authority or the European Central Bank in relation to its making, funding or maintaining
Eurodollar Loans.




     (b) Each Lender shall promptly notify the Borrower and the Administrative Agent of any
event of which it has knowledge, occurring after the date hereof, which will entitle such
Lender to compensation pursuant to this Section 3.12 and will designate a different Lending
Office if such designation will avoid the need for, or reduce the amount of, such
compensation and will not, in the reasonable judgment of such Lender, be otherwise
materially disadvantageous to it. Any Lender claiming compensation under this Section 3.12
shall furnish to the Borrower and the Administrative Agent a statement setting forth in
reasonable detail the additional amount or amounts to be paid to it hereunder which shall be
conclusive absent manifest error.




     (c) The Borrower shall not be required to compensate a Lender pursuant to this Section
3.12 for any increased costs or reductions incurred more than 180 days prior to the date
that such Lender notifies the Borrower of the change of Law giving rise to such increased
costs or reductions and of such Lender’s intention to claim compensation therefor.



     3.13 Taxes.




     (a) Any and all payments by a Credit Party to or for the account of the Administrative
Agent or any Lender under any Credit Document shall be made free and clear of and without
deduction for any and all present or future income, stamp or other taxes, duties, levies,
imposts, deductions, assessments, fees, withholdings or similar charges, and all liabilities
with respect thereto, but excluding, in the case of the Administrative Agent and each
Lender, taxes imposed on or measured by its net income, and franchise taxes imposed on it
(in lieu of net income taxes), by the jurisdiction (or any political subdivision thereof)
under the laws of which the Administrative Agent or such Lender, as the case may be, is
organized or maintains its Lending Office (all such non-excluded taxes, duties, levies,
imposts, deductions, assessments, fees, withholdings or similar charges, and liabilities
being hereinafter referred to as “Taxes”). If a Credit Party shall be required by
any Requirement of Law to deduct any Taxes from or in respect of any sum payable under any
Credit Document to the Administrative Agent or any Lender, (i) the sum payable shall be
increased as necessary so that after making all required deductions (including deductions
applicable to additional sums payable under this Section 3.13(a)), the Administrative Agent
and such Lender receives an amount equal to the sum it would have received had no such
deductions been made, (ii) such Credit Party shall make such deductions, (iii) such Credit
Party shall pay the full amount deducted to the relevant taxation authority or other
authority in accordance with applicable Requirements of Law, and (iv) within 30 days after
the date of such payment, such Credit Party shall furnish to the Administrative Agent (which
shall forward the same to such Lender) the original or a certified copy of a receipt
evidencing payment thereof. Notwithstanding the



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foregoing, no additional sums shall be
payable pursuant to this Section 3.13(a) with respect to Taxes (A) that are attributable to
a Lender’s failure to comply with Section 3.13(e) or (B) that are United States withholding
taxes imposed on amounts payable to such Lender at the time the Lender becomes a party to
this Credit Agreement.




     (b) In addition, each Credit Party agrees to pay any and all present or future stamp,
court or documentary taxes and any other excise or property taxes or charges or similar
levies which arise from any payment made under any Credit Document or from the execution,
delivery, performance, enforcement or registration of, or otherwise with respect to, any
Credit Document (hereinafter referred to as “Other Taxes”).




     (c) If a Credit Party shall be required to deduct or pay any Taxes or Other Taxes from
or in respect of any sum payable under any Credit Document to the Administrative Agent or
any Lender, such
Credit Party shall also pay to the Administrative Agent (for the account of such Lender) or
to such Lender, at the time interest is paid, such additional amount that such Lender
specifies as necessary to preserve the after-tax yield (after factoring in all taxes,
including taxes imposed on or measured by net income) such Lender would have received if
such Taxes or Other Taxes had not been imposed.




     (d) Each Credit Party agrees to indemnify the Administrative Agent and each Lender for
(i) the full amount of Taxes and Other Taxes (including any Taxes or Other Taxes imposed or
asserted by any jurisdiction on amounts payable under this Section 3.13(d)) paid by the
Administrative Agent and such Lender, (ii) amounts payable under Section 3.13(c) and (iii)
any liability (including penalties, interest and expenses) arising therefrom or with respect
thereto, in each case whether or not such Taxes or Other Taxes were correctly or legally
imposed or asserted by the relevant Governmental Authority.




     (e) Each Lender that is a “foreign corporation, partnership or trust” within the
meaning of the Code shall deliver to the Administrative Agent, prior to receipt of any
payment subject to withholding under the Code (or after accepting an assignment of an
interest herein), two duly signed completed copies of either IRS Form W-8BEN or any
successor thereto (relating to such Lender and entitling it to an exemption from, or
reduction of, withholding tax on all payments to be made to such Lender by a Credit Party
pursuant to this Agreement) or IRS Form W-8ECI or any successor thereto (relating to all
payments to be made to such Lender by a Credit Party pursuant to this Agreement) or such
other evidence satisfactory to the Borrower and the Administrative Agent that such Lender is
entitled to an exemption from, or reduction of, U.S. withholding tax. Thereafter and from
time to time, each such Lender shall (i) promptly submit to the Administrative Agent such
additional duly completed and signed copies of one of such forms (or such successor forms as
shall be adopted from time to time by the relevant United States taxing authorities) as may
then be available under then current United States laws and regulations to avoid, or such
evidence as is satisfactory to the Borrower



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and the Administrative Agent of any available
exemption from or reduction of, United States withholding taxes in respect of all payments
to be made to such Lender by a Credit Party pursuant to this Agreement, (ii) promptly notify
the Agent of any change in circumstances which would modify or render invalid any claimed
exemption or reduction, and (iii) take such steps as shall not be materially disadvantageous
to it, in the reasonable judgment of such Lender, and as may be reasonably necessary
(including the re-designation of its Lending Office) to avoid any Requirement of Law that
the Credit Parties make any deduction or withholding for taxes from amounts payable to such
Lender. If such Lender fails to deliver the above forms or other documentation, then the
Administrative Agent may withhold from any interest payment to such Lender an amount
equivalent to the applicable withholding tax imposed by Sections 1441 and 1442 of the Code,
without reduction. If any Governmental Authority asserts that the Administrative Agent did
not properly withhold any tax or other amount from payments made in respect of such Lender,
such Lender shall indemnify the Administrative Agent therefor, including all penalties and
interest, any taxes imposed by any jurisdiction on the amounts payable to the Administrative
Agent under this Section 3.13(e), and costs and expenses (including Attorney Costs) of the
Administrative Agent. The obligation of the Lenders under this Section 3.13(e) shall
survive the payment of all Obligations and the resignation or replacement of the
Administrative Agent.



     Without limiting the obligations of the Lenders set forth above regarding delivery of certain
forms and documents to establish each Lender’s status for U.S. withholding tax purposes, each
Lender agrees promptly to deliver to the Administrative Agent or the Borrower, as the
Administrative Agent or the Borrower shall reasonably request, on or prior to the First Amendment
Effective Date, and in a timely fashion thereafter, such other documents and forms required by any
relevant taxing authorities under the Laws of any other jurisdiction, duly executed and completed
by such Lender, as are required under such Laws to confirm such Lender’s entitlement to any
available exemption from, or reduction of, applicable withholding taxes in respect of all payments
to be made to such Lender outside of the U.S. by the Borrower pursuant to this Credit Agreement or
otherwise to establish such Lender’s status for withholding tax purposes in such other
jurisdiction. Each Lender shall promptly (i) notify the Administrative Agent of any change in
circumstances which would modify or render invalid any such claimed
exemption or reduction, and (ii) take such steps as shall not be materially disadvantageous to
it, in the reasonable judgment of such Lender, and as may be reasonably necessary (including the
re-designation of its Lending Office) to avoid any requirement of applicable Laws of any such
jurisdiction that any Borrower make any deduction or withholding for taxes from amounts payable to
such Lender. Additionally, each of the Borrowers shall promptly deliver to the Administrative
Agent or any Lender, as the Administrative Agent or such Lender shall reasonably request, on or
prior to the First Amendment Effective Date, and in a timely fashion thereafter, such documents and
forms required by any relevant taxing authorities under the Laws of any jurisdiction, duly executed
and completed by such Borrower, as are required to be furnished by such Lender or the
Administrative Agent under such Laws in connection with any



53









 




payment by the Administrative Agent or
any Lender of Taxes or Other Taxes, or otherwise in connection with the Credit Documents, with
respect to such jurisdiction.





     (f) For any period with respect to which a Lender required to do so has failed to
provide the Borrower and the Administrative Agent with the appropriate form pursuant to
Section 3.13(e) (unless such failure is due to a change in treaty, law or regulation
occurring subsequent to that date on which a form originally was required to be provided),
such Lender shall not be entitled to indemnification under Section 3.13(a) or 3.13(b) with
respect to Taxes imposed by the United States of America; provided however,
that should a Lender that is otherwise exempt from withholding tax become subject to Taxes
because of its failure to deliver a form required hereunder, the Borrower shall take such
steps as such Lender shall reasonably request to assist such Lender to recover such Taxes.




     (g) If any Credit Party is required to pay any additional amounts to or for the account
of any Lender pursuant to this Section 3.13, then such Lender shall use reasonable efforts
to change the jurisdiction of its Lending Office so as to eliminate or reduce any such
additional payment which may thereafter accrue if such change, in the judgment of such
Lender, is not otherwise materially disadvantageous to such Lender.




     (h) If the Administrative Agent or any Lender receives a refund with respect to Taxes
paid by the Borrower that, in the good faith judgment of such Lender, is allocable to such
payment, the Administrative Agent or such Lender, respectively, shall promptly pay the
amount of such refund, together with any other amounts paid by the Borrower in connection
with such refunded Taxes to the extent such other amounts are received by the Administrative
Agent or such Lender, to the Borrower, net of all out-of-pocket expenses of such Lender
incurred in obtaining such refund, provided, however, that the Borrower
agrees to promptly return such refund and such other amounts to the Administrative Agent or
such Lender, as applicable, if it receives notice from the Administrative Agent or such
Lender that the Administrative Agent or such Lender is required to repay such refund to the
applicable taxing authority. The Administrative Agent and each Lender agrees that it will
contest such Taxes or liabilities if the Administrative Agent or such Lender determined, in
its reasonable judgment, that it would not be disadvantaged or prejudiced as a result of
such contest.



     3.14 Compensation.



     Upon the written demand of any Lender, the Borrower shall promptly compensate (or cause the
applicable Designated Borrower to compensate) such Lender for and hold such Lender harmless from
any loss, cost or expense incurred by it as a result of:




54










 







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




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




     (c) any failure by any Borrower to make payment of any Loan or drawing under any Letter
of Credit (or interest due thereon) denominated in an Alternative Currency on its scheduled
due date or any payment thereof in a different currency.


The amount each such Lender shall be compensated pursuant to this Section 3.14 shall include (a)
any loss incurred by such Lender in connection with the re-employment of funds prepaid, repaid, not
borrowed or paid, as the case may be, and the amount of such loss shall be the excess, if any, of
(i) interest or other cost to such Lender of the deposit or other source of funding used to make
any such Eurodollar Loan over (ii) the interest earned (or to be earned) by such Lender upon the
re-lending or other re-employment of the amount of such Eurodollar Loan for the remainder of its
respective Interest Period plus (b) any other loss of anticipated profits, any foreign
exchange losses and any loss or expense arising from the liquidation or re-employment of funds
obtained by it to maintain such Loan or from fees payable to terminate the deposits from which such
funds were obtained or from the performance of any foreign exchange contract plus (c) $250
plus (d) any reasonable out-of-pocket expenses (including Attorney Costs) incurred and
reasonably attributable thereto. Any Lender claiming compensation under this Section 3.14 shall
furnish to the Borrower and the Administrative Agent a statement setting forth in reasonable detail
the calculations of amounts to be paid hereunder, and the Borrower shall not be required to
compensate a Lender pursuant to this Section 3.14 for any such loss, cost or expense incurred more
than 180 days prior to the date that such Lender notifies the Borrower of the incurrence of such
loss, cost or expense.



For purposes of calculating amounts payable by the Borrower (or the applicable Designated Borrower)
to the Lenders under this Section 3.14, each Lender may deem that it funded each Eurodollar Loan
made by it at the Eurodollar Rate for such Eurodollar Loan by a matching deposit or other borrowing
in the offshore interbank market for such currency for a comparable amount and for a comparable
period, whether or not such Eurodollar Loan was in fact so funded.




     3.15 Determination and Survival of Provisions.



     All determinations by the Administrative Agent or a Lender of amounts owing under Sections 3.9
through 3.14, inclusive, shall, absent manifest error, be conclusive and binding on the parties
hereto. In determining such amount, the Administrative Agent or such Lender may



55









 




use any reasonable averaging and attribution methods. Section 3.9 through 3.14, inclusive, shall survive the
termination of this Credit Agreement and the payment of all Credit Party Obligations.




SECTION 4




GUARANTY



     4.1 Guaranty of Payment.



     Subject to Section 4.7 below, each of the Guarantors hereby, jointly and severally,
unconditionally and irrevocably guarantees to each Lender, each Affiliate of a Lender that enters
into a Hedging Agreement, the Issuing Lender and the Administrative Agent the prompt payment of the
Credit Party Obligations in full when due (whether at stated maturity, as a mandatory prepayment,
by acceleration or otherwise) and the timely performance of all other obligations under the Credit Documents and such Hedging Agreements.
This Guaranty is a guaranty of payment and not of collection and is a continuing guaranty and shall
apply to all Credit Party Obligations whenever arising.



     4.2 Obligations Unconditional.



     The obligations of the Guarantors hereunder are absolute and unconditional, irrespective of
the value, genuineness, validity, regularity or enforceability of any of the Credit Documents or
the Hedging Agreements, or any other agreement or instrument referred to therein, to the fullest
extent permitted by applicable law, irrespective of any other circumstance whatsoever which might
otherwise constitute a legal or equitable discharge or defense of a surety or guarantor. Each
Guarantor agrees that this Guaranty may be enforced by the Lenders without the necessity at any
time of resorting to or exhausting any other security or collateral and without the necessity at
any time of having recourse to the Notes or any other of the Credit Documents or any collateral, if
any, hereafter securing the Credit Party Obligations or otherwise and each Guarantor hereby waives
the right to require the Lenders to proceed against the Borrower or any other Person (including a
co-guarantor) or to require the Lenders to pursue any other remedy or enforce any other right.
Each Guarantor further agrees that it shall have no right of subrogation, indemnity, reimbursement
or contribution against the Borrower or any other Guarantor of the Credit Party Obligations for
amounts paid under this Guaranty until such time as the Lenders (and any Affiliates of Lenders
entering into Hedging Agreements) have been paid in full, all Commitments under the Credit
Agreement have been terminated and no Person or Governmental Authority shall have any right to
request any return or reimbursement of funds from the Lenders in connection with monies received
under the Credit Documents. Each Guarantor further agrees that nothing contained herein shall
prevent the Lenders from suing on the Notes or any of the other Credit Documents or any of the
Hedging Agreements or foreclosing its security interest in or Lien on any collateral, if any,
securing the Credit Party Obligations or from exercising any other rights available to it under
this Credit Agreement, the Notes, any other of the Credit Documents, or any other instrument of
security, if



56









 




any, and the exercise of any of the aforesaid rights and the completion of any
foreclosure proceedings shall not constitute a discharge of any of any Guarantor’s obligations
hereunder; it being the purpose and intent of each Guarantor that its obligations hereunder shall
be absolute, independent and unconditional under any and all circumstances. Neither any
Guarantor’s obligations under this Guaranty nor any remedy for the enforcement thereof shall be
impaired, modified, changed or released in any manner whatsoever by an impairment, modification,
change, release or limitation of the liability of the Borrower or by reason of the bankruptcy or
insolvency of the Borrower. Each Guarantor waives any and all notice of the creation, renewal,
extension or accrual of any of the Credit Party Obligations and notice of or proof of reliance of
by the Administrative Agent or any Lender upon this Guaranty or acceptance of this Guaranty. The
Credit Party Obligations, and any of them, shall conclusively be deemed to have been created,
contracted or incurred, or renewed, extended, amended or waived, in reliance upon this Guaranty.
All dealings between the Borrower and any of the Guarantors, on the one hand, and the
Administrative Agent and the Lenders, on the other hand, likewise shall be conclusively presumed to
have been had or consummated in reliance upon this Guaranty. The Guarantors further agree to all
rights of set-off and automatic debits as set forth in Section 11.2.




     4.3 Modifications.



     Each Guarantor agrees that (a) all or any part of the collateral, if any, now or hereafter
held for the Credit Party Obligations, if any, may be exchanged, compromised or surrendered from
time to time; (b) the Lenders shall not have any obligation to protect, perfect, secure or insure
any such security interests, liens or encumbrances now or hereafter held, if any, for the Credit
Party Obligations or the properties subject thereto; (c) the time or place of payment of the Credit
Party Obligations may be changed or extended, in whole or in part, to a time certain or otherwise,
and may be renewed or accelerated, in whole or in part; (d) the Borrower and any other party liable
for payment under the Credit Documents may be granted indulgences generally; (e) any of the
provisions of the Notes or any of the other Credit Documents may be modified, amended or waived;
(f) any party (including any co-guarantor) liable for the payment thereof may be granted
indulgences or be released; and (g) any deposit balance for the credit of the Borrower or any other
party liable for the payment of the Credit Party Obligations or liable upon any security therefor may be released, in
whole or in part, at, before or after the stated, extended or accelerated maturity of the Credit
Party Obligations, all without notice to or further assent by such Guarantor, which shall remain
bound thereon, notwithstanding any such exchange, compromise, surrender, extension, renewal,
acceleration, modification, indulgence or release.



     4.4 Waiver of Rights.



     Each Guarantor expressly waives to the fullest extent permitted by applicable law: (a) notice
of acceptance of this Guaranty by the Lenders and of all extensions of credit to the Borrower by
the Lenders; (b) presentment and demand for payment or performance of any of the Credit Party
Obligations; (c) protest and notice of dishonor or of default (except as specifically required in
the Credit Agreement) with respect to the Credit Party Obligations or with respect to any security



57









 




therefor; (d) notice of the Lenders obtaining, amending, substituting for, releasing, waiving or
modifying any security interest, lien or encumbrance, if any, hereafter securing the Credit Party
Obligations, or the Lenders’ subordinating, compromising, discharging or releasing such security
interests, liens or encumbrances, if any; and (e) all other notices to which such Guarantor might
otherwise be entitled.




     4.5 Reinstatement.



     The obligations of the Guarantors under this Section 4 shall be automatically reinstated if
and to the extent that for any reason any payment by or on behalf of any Person in respect of the
Credit Party Obligations is rescinded or must be otherwise restored by any holder of any of the
Credit Party Obligations, whether as a result of any proceedings in bankruptcy or reorganization or
otherwise, and each Guarantor agrees that it will indemnify the Administrative Agent and each
Lender on demand for all reasonable costs and expenses (including, without limitation, reasonable
Attorney Costs) incurred by the Administrative Agent or such Lender 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.



     4.6 Remedies.



     The Guarantors agree that, as between the Guarantors, on the one hand, and the Administrative
Agent and the Lenders, on the other hand, the Credit Party Obligations may be declared to be
forthwith due and payable as provided in Section 9 (and shall be deemed to have become
automatically due and payable in the circumstances provided in Section 9) notwithstanding any stay,
injunction or other prohibition preventing such declaration (or preventing such Credit Party
Obligations from becoming automatically due and payable) as against any other Person and that, in
the event of such declaration (or such Credit Party Obligations being deemed to have become
automatically due and payable), such Credit Party Obligations (whether or not due and payable by
any other Person) shall forthwith become due and payable by the Guarantors.



     4.7 Limitation of Guaranty.



     Notwithstanding any provision to the contrary contained herein or in any of the other Credit
Documents, to the extent the obligations of any Guarantor shall be adjudicated to be invalid or
unenforceable for any reason (including, without limitation, because of any applicable state or
federal law relating to fraudulent conveyances or transfers) then the obligations of such Guarantor
hereunder shall be limited to the maximum amount that is permissible under applicable law (whether
federal or state or otherwise and including, without limitation, the Bankruptcy Code).



58









 





     4.8 Rights of Contribution.



     The Credit Parties agree among themselves that, in connection with payments made hereunder,
each Credit Party shall have contribution rights against the other Credit Parties as permitted
under applicable law. Such contribution rights shall be subordinate and subject in right of payment to the
obligations of the Credit Parties under the Credit Documents and no Credit Party shall exercise
such rights of contribution until all Credit Party Obligations have been paid in full and the
Commitments terminated.



SECTION 5




CONDITIONS PRECEDENT



     5.1 Closing Conditions.



     The obligation of the Lenders, the Administrative Agent and the Issuing Lender to enter into
this Credit Agreement and make the initial Extension of Credit is subject to satisfaction (or
waiver) of the following conditions:




     (a) Executed Credit Documents. Receipt by the Administrative Agent of duly
executed copies of: (i) this Credit Agreement; (ii) the Notes; and (iii) all other Credit
Documents, each in form and substance reasonably acceptable to the Lenders in their sole
discretion.




     (b) Authority Documents. Receipt by the Administrative Agent of the following
with respect to each Credit Party:




     (i) Organizational Documents. Copies of the articles or certificates
of incorporation or other organizational documents of each Credit Party certified to
be true and complete as of a recent date by the appropriate Governmental Authority
of the state or other jurisdiction of its formation and certified by a secretary or
assistant secretary of such Credit Party to be true and correct as of the Closing
Date.




     (ii) Bylaws. A copy of the bylaws or other governing documents of each
Credit Party certified by a secretary or assistant secretary of such Credit Party to
be true and correct as of the Closing Date.




     (iii) Resolutions. Copies of resolutions of the Board of Directors or
other governing body of each Credit Party approving and adopting the Credit
Documents to which it is a party, the transactions contemplated therein and
authorizing execution and delivery thereof, certified by a secretary or assistant
secretary of such Credit Party to be true and correct and in full force and effect
as of the Closing Date.



59









 






     (iv) Good Standing. Copies of certificates of good standing, existence
or its equivalent with respect to each Credit Party certified as of a recent date by
the appropriate Governmental Authority of the state or other jurisdiction of its
formation and, without duplication, the State of Minnesota except to the extent that
failure to do so could not reasonably be expected to have a Material Adverse Effect.




     (v) Incumbency. An incumbency certificate of each Credit Party
certified by a secretary or assistant secretary of such Credit Party to be true and
correct as of the Closing Date.




     (c) Opinion of Counsel. Receipt by the Administrative Agent of opinions
reasonably satisfactory to the Administrative Agent, addressed to the Administrative Agent,
the Issuing Lender and the Lenders and dated as of the Closing Date.




     (d) Financial Statements. Receipt by the Lenders of (i) the annual
consolidated financial statements (including balance sheets, income statements and cash flow
statements) of the Borrower and its Subsidiaries for the fiscal year 2003 audited by independent public
accountants of recognized national standing, together with the “management letter” submitted
by such accountants in connection with such financial statements, (ii) the consolidated
financial statements (including balance sheets, income statements and cash flow statements)
of the Borrower and its Subsidiaries for the fiscal quarter ended March 31, 2004 and (iii)
such other financial information regarding the Borrower and its Subsidiaries as the
Administrative Agent or a Lender may request.




     (e) Consents. Receipt by the Administrative Agent of evidence that all
necessary governmental, shareholder and third party consents and approvals, if any, have
been received and no condition or Requirement of Law exists which would reasonably be likely
to restrain, prevent or impose any material adverse conditions on the transactions
contemplated hereby.




     (f) Officer’s Certificates. The Administrative Agent shall have received a
certificate or certificates executed by an Authorized Officer of the Borrower as of the
Closing Date stating that (i) the Credit Parties and each of their Subsidiaries are in
compliance with all existing material financial obligations, (ii) no action, suit,
investigation or proceeding is pending or, to the knowledge of any Credit Party, threatened
in any court or before any arbitrator or Governmental Authority that purports to affect the
Credit Parties, any of their Subsidiaries or any transaction contemplated by the Credit
Documents, if such action, suit, investigation or proceeding would have or would reasonably
be expected to have a Material Adverse Effect, (iii) all governmental, shareholder and
third party consents and approvals, if any, with respect to the Credit Documents and the
transactions contemplated thereby have been obtained, (iv) the financial statements and
information



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delivered to the Administrative Agent on or before the Closing Date were
prepared in good faith and in accordance with GAAP and (v) immediately after giving effect
to this Credit Agreement, the other Credit Documents and all the transactions contemplated
herein or therein to occur on such date, (A) each Credit Party and each of their
Subsidiaries is Solvent, (B) no Default or Event of Default exists, (C) all representations
and warranties contained herein and in the other Credit Documents are true and correct in
all material respects, and (D) the Credit Parties are in compliance with each of the
financial covenants set forth in Section 7.2, including calculation thereof as of March 31,
2004.




     (g) Other Indebtedness. Receipt by the Administrative Agent of evidence
satisfactory to it that all of the Indebtedness of the Credit Parties under the Existing
Credit Agreements have been paid in full (or will be paid in full with the proceeds of the
initial Loans made herein) and all obligations of the lenders thereunder in connection
therewith have been terminated.




     (h) Fees and Expenses. Payment by the Credit Parties of all fees and expenses
owed by them to the Administrative Agent or the Lenders, including, without limitation, as
set forth in the Fee Letter.




     (i) Other. Receipt by the Lenders of such other documents, instruments,
agreements or information as reasonably and timely requested by any Lender.



     5.2 Conditions to All Extensions of Credit.



     In addition to the conditions precedent stated elsewhere herein, the Lenders shall not be
obligated to make Loans nor shall the Issuing Lender be required to issue or extend a Letter of
Credit unless:




     (a) Notice. (i) In the case of any new Loan, the Borrower shall have delivered
a Notice of Borrowing, duly executed and completed, by the time specified in Section 2.1 and
(ii) in the case of any Letter of Credit, the Borrower shall have delivered to the Issuing
Lender an appropriate request for issuance in accordance with the provisions of Section 2.2.




     (b) Representations and Warranties. The representations and warranties made by
the Credit Parties in any Credit Document are true and correct in all material respects at
and as if made as of such date except to the extent they expressly and exclusively relate to
an earlier date.




     (c) No Default. No Default or Event of Default shall exist and be continuing
either prior to or after giving effect thereto.




     (d) Availability. Immediately after giving effect to the making of such Loan
(and the application of the proceeds thereof) or to the issuance of such Letter of Credit,
as



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the case may be, the sum of the principal amount of Loans outstanding plus LOC
Obligations outstanding shall not exceed the Revolving Committed Amount.




     (e) In the case of an Extension of Credit to be denominated in an Alternative Currency,
there shall not have occurred any change in national or international financial, political
or economic conditions or currency exchange rates or exchange controls which in the
reasonable opinion of the Administrative Agent, the Required Lenders (in the case of any
Loans to be denominated in an Alternative Currency) or the Issuing Lender (in the case of
any Letter of Credit to be denominated in an Alternative Currency) would make it
impracticable for such Extension of Credit to be denominated in the relevant Alternative
Currency.


The delivery of each Notice of Borrowing and each request for a Letter of Credit shall constitute a
representation and warranty by the Borrower of the correctness of the matters specified in
subsections (b), (c), and (d) above.




SECTION 6




REPRESENTATIONS AND WARRANTIES



     The Credit Parties hereby represent to the Administrative Agent, the Issuing Lender and each
Lender that:



     6.1 Organization and Good Standing.



     Each Credit Party (a) is either a partnership, a corporation or a limited liability company
duly organized, validly existing and in good standing under the laws of the jurisdiction of its
organization, (b) is duly qualified and in good standing as a foreign organization and authorized
to do business in every other jurisdiction where its ownership or operation of property or the
conduct of its business would require it to be qualified, in good standing and authorized, unless
the failure to be so qualified, in good standing or authorized would not have or would not
reasonably be expected to have a Material Adverse Effect and (c) has the power and authority to own
and operate its properties and to carry on its business as now conducted and as currently proposed
to be conducted.



     6.2 Due Authorization.



     Each Credit Party (a) has the power and authority to execute, deliver and perform this Credit
Agreement and the other Credit Documents to which it is a party and to incur the obligations herein
and therein provided for and (b) has duly taken all necessary action to authorize, and is duly
authorized, to execute, deliver and perform this Credit Agreement and the other Credit Documents to
which it is a party.



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     6.3 Enforceable Obligations.



     Each Credit Party has duly executed this Credit Agreement and each other Credit Document to
which such Credit Party is a party and this Credit Agreement and such other Credit Documents
constitute legal, valid and binding obligations of such Credit Party enforceable against such Credit Party in
accordance with their respective terms, except as may be limited by bankruptcy or insolvency laws
or similar laws affecting creditors’ rights generally or by general equitable principles.



     6.4 No Conflicts.



     Neither the execution and delivery of the Credit Documents to which it is a party, nor the
consummation of the transactions contemplated herein and therein, nor the performance of or
compliance with the terms and provisions hereof and thereof by a Credit Party will (a) violate,
contravene or conflict with any provision of such Credit Party’s organizational documents, (b)
violate, contravene or conflict with any Requirement of Law (including, without limitation,
Regulations T, U or X), order, writ, judgment, injunction, decree, license or permit applicable to
such Credit Party, (c) violate, contravene or conflict with contractual provisions of, or cause an
event of default under, any indenture, loan agreement, mortgage, deed of trust, contract or other
agreement or instrument to which such Credit Party is a party or by which it or its properties may
be bound, or (d) result in or require the creation of any Lien upon or with respect to the
properties of such Credit Party.



     6.5 Consents.



     Except for consents, approvals and authorizations which have been obtained, no consent,
approval, authorization or order of, or filing, registration or qualification with, any
Governmental Authority, equity owner or third party in respect of any Credit Party is required in
connection with the execution, delivery or performance of this Credit Agreement or any of the other
Credit Documents, or the consummation of any transaction contemplated herein or therein by such
Credit Party.



     6.6 Financial Condition.



     The financial statements delivered to the Administrative Agent and the Lenders pursuant to
Section 5.1(d) and Sections 7.1(a) and (b): (a) have been prepared in accordance with GAAP and (b)
present fairly the consolidated financial condition, results of operations and cash flows of the
Borrower and its Subsidiaries as of such date and for such periods. Since December 31, 2003, there
has been no sale, transfer or other disposition by the Borrower or any of its Subsidiaries of any
material part of the business or property of the Borrower and its Subsidiaries, taken as a whole,
or purchase or other acquisition by any such Person of any business or property (including any
Capital Stock of any other Person) material in relation to the consolidated financial condition of
the Borrower and its Subsidiaries, taken as a whole, in each case, which, is not (i) reflected in
the most



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recent financial statements delivered to the Lenders pursuant to Section 5.1(d) and
Section 7.1 or in the notes thereto or (ii) otherwise permitted by the terms of this Credit
Agreement and communicated to the Administrative Agent and the Lenders.




     6.7 No Material Change.



     Since December 31, 2003, there has been no development or event relating to or affecting any
Credit Party or any of its Subsidiaries which has had or would reasonably be expected to have a
Material Adverse Effect.



     6.8 Disclosure.



     Neither this Credit Agreement, nor any other Credit Document, nor any financial statements
delivered to the Administrative Agent or the Lenders nor any other document, certificate or
statement furnished to the Administrative Agent, the Issuing Lender or the Lenders by or on behalf
of any Credit Party in connection with the transactions contemplated hereby contains any untrue
statement of a material fact or omits to state a material fact necessary in order to make the
statements contained therein or herein not misleading.



     6.9 No Default.



     No Credit Party nor any of its Subsidiaries is in default under any contract, lease, loan
agreement, indenture, mortgage, security agreement or other agreement or obligation to which it is
a party or by which any of its properties is bound, which default has had or would reasonably be
expected to have a Material Adverse Effect.



     6.10 Litigation.



     There are no actions, suits or legal, equitable, arbitration or administrative proceedings,
pending or, to the knowledge of any Credit Party, threatened against, any Credit Party or any of
its Subsidiaries or with respect to its properties or revenues which (a) purport to affect or
pertain to this Credit Agreement or the other Credit Documents or the transactions contemplated
herein and therein or (b) would have or would reasonably be expected to have a Material Adverse
Effect.



     6.11 Taxes.



     Each Credit Party and each of its Subsidiaries has filed, or caused to be filed, all material
tax returns (federal, state, local and foreign) required to be filed and has paid (a) all amounts
of taxes shown thereon to be due (including interest and penalties) and (b) all other material
taxes, fees, assessments and other governmental charges (including mortgage recording taxes,
documentary stamp taxes and intangibles taxes) owing by it, except for such taxes (i) which are not
yet delinquent or (ii) that are being contested in good faith and by proper proceedings, and
against



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which adequate reserves are being maintained in accordance with GAAP. No Credit Party is
aware of any proposed material tax assessments against any Credit Party or any of its Subsidiaries.




     6.12 Compliance with Law.



     Each Credit Party and each of its Subsidiaries is in compliance with all material Requirements
of Law (including, without limitation, Environmental Laws and ERISA) and all material orders,
writs, injunctions and decrees applicable to it, or to its properties.



     6.13 Licenses, etc.



     Each Credit Party and each of its Subsidiaries has obtained, and holds in full force and
effect, all franchises, licenses, permits, certificates, authorizations, qualifications,
accreditations, easements, rights of way, intellectual property rights and other rights, consents
and approvals which are necessary for the operation of its business as presently conducted, except
for such exceptions as would not have or would not reasonably be expected to have a Material
Adverse Effect.



     6.14 Title to Properties.



     Each Credit Party, and each of its Subsidiaries, is the owner of, and has good and marketable
title to, or has a valid license or lease to use, all of its properties and assets (except for
minor defects in title, licenses or leases that do not materially interfere with its ability to
conduct its business or to utilize its properties or assets for their intended purposes) and none
of such properties or assets is subject to any Liens other than Permitted Liens.



     6.15 Insurance.



     The properties of each Credit Party and each of its Subsidiaries are insured with financially
sound and reputable insurance companies that are not Affiliates of the Borrower, in such amounts,
with such deductibles and covering such risks, as are customarily carried by companies engaged in
similar businesses and owning similar properties in localities where the Credit Parties or their
Subsidiaries operate.



     6.16 Use of Proceeds.



     The proceeds of the Loans will be used solely for the purposes specified in Section 7.10. No
proceeds of the Loans will be used for the Acquisition of another Person unless such Acquisition is
a Permitted Acquisition.



     6.17 Government Regulation.




     (a) No Borrower is engaged or will engage, principally or as one of its important
activities, in the business of purchasing or carrying margin stock (within the



65









 






meaning of Regulation U), or extending credit for the purpose of purchasing or carrying margin stock.
Following the application of the proceeds of each Loan or drawing under each Letter of
Credit, not more than 25% of the value of the assets (either of the applicable Borrower only
or of the Borrower and its Subsidiaries on a consolidated basis) will be margin stock.




     (b) No Credit Party (i) is a “holding company,” or a “subsidiary company” of a “holding
company,” or an “affiliate” of a “holding company” or of a “subsidiary company” of a
“holding company,” within the meaning of the Public Utility Holding Company Act of 1935, or
(ii) is or is required to be registered as an “investment company” under the Investment
Company Act of 1940.



     6.18 No Burdensome Restrictions.



     No Credit Party nor any of its Subsidiaries is a party to any agreement or instrument or
subject to any other obligation or any charter or corporate restriction or any provision of any
applicable law, rule or regulation which, individually or in the aggregate, would have or would
reasonably be expected to have a Material Adverse Effect.



     6.19 ERISA.



     Except as would not result in or would not reasonably be expected to result in a Material
Adverse Effect:




     (a) (i) No ERISA Event has occurred, and, to the best knowledge of the Credit Parties,
each of their Subsidiaries and each ERISA Affiliate, no event or condition has occurred or
exists as a result of which any ERISA Event could reasonably be expected to occur, with
respect to any Plan; (ii) no “accumulated funding deficiency,” as such term is defined in
Section 302 of ERISA and Section 412 of the Code, whether or not waived, has occurred with
respect to any Plan and no application for a funding waiver or an extension of any
amortization period pursuant to Section 412 of the Code has been made with respect to any
Plan; (iii) each Plan has been maintained, operated, and funded in compliance with its own
terms and in material compliance with the provisions of ERISA, the Code, and any other
applicable federal or state laws; (iv) each Plan that is intended to qualify under Section
401(a) of the Code has received a favorable determination letter from the IRS or an
application for such a letter is currently being processed by the IRS with respect thereto
and, to the best knowledge of the Credit Parties, each of their Subsidiaries and each ERISA
Affiliate, nothing has occurred which would prevent, or cause the loss of, such
qualification; and (v) no Lien in favor or the PBGC or a Plan has arisen or is reasonably
likely to arise on account of any Plan.




     (b) The actuarial present value of all “benefit liabilities” (as defined in Section
4001(a)(16) of ERISA), whether or not vested, under each Single Employer Plan, as of the



66









 






last annual valuation date prior to the date on which this representation is made or deemed
made (determined, in each case, in accordance with Financial Accounting Standards Board Statement
87, utilizing the actuarial assumptions used in such Plan’s most recent actuarial valuation
report), did not exceed as of such valuation date the fair market value of the assets of
such Plan allocated to such accrued liabilities.




     (c) No Credit Party nor any Subsidiary of a Credit Party nor any ERISA Affiliate has
incurred, or, to the best of each such party’s knowledge, is reasonably expected to incur,
any liability under Title IV of ERISA with respect to any Single Employer Plan, or any
withdrawal liability under ERISA to any Multiemployer Plan or Multiple Employer Plan. No
Credit Party nor any Subsidiary of a Credit Party nor any ERISA Affiliate would become
subject to any withdrawal liability under ERISA if any such party were to withdraw
completely from all Multiemployer Plans and Multiple Employer Plans as of the valuation date
most closely preceding the date on which this representation is made or deemed made. No
Credit Party nor any Subsidiary of a Credit Party nor any ERISA Affiliate has received any
notification that any Multiemployer Plan is in reorganization (within the meaning of Section
4241 of ERISA), is insolvent (within the meaning of Section 4245 of ERISA), or has been
terminated (within the meaning of Title IV of ERISA), and no Multiemployer Plan is, to the
best of each such Person’s knowledge, reasonably expected to be in reorganization,
insolvent, or terminated. No Credit Party nor any Subsidiary of a Credit Party nor any
ERISA Affiliate has engaged in a transaction that could be subject to Sections 4069 or
4212(c) of ERISA.




     (d) No prohibited transaction (within the meaning of Section 406 of ERISA or Section
4975 of the Code) or breach of fiduciary responsibility has occurred with respect to a Plan
which has subjected or may subject a Credit Party, any Subsidiary of a Credit Party or any
ERISA Affiliate to any liability under Sections 406, 409, 502(i), or 502(l) of ERISA or
Section 4975 of the Code, or under any agreement or other instrument pursuant to which a
Credit Party, any Subsidiary of a Credit Party or any ERISA Affiliate has agreed or is
required to indemnify any person against any such liability. There are no pending or, to
the best knowledge of the Credit Parties, each of their Subsidiaries and each ERISA
Affiliate, threatened claims, actions or lawsuits, or action by any Governmental Authority,
with respect to any Plan that could reasonably be expected to have a Material Adverse
Effect.



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     (e) No Credit Party nor any Subsidiary of a Credit Party nor any ERISA Affiliate has
any material liability with respect to “expected post-retirement benefit obligations” within
the meaning of the Financial Accounting Standards Board Statement 106. Each Plan that is a
welfare plan (as defined in Section 3(1) of ERISA) to which Sections 601-609 of ERISA and
Section 4980B of the Code apply has been administered in compliance in all material respects
with such sections.



     6.20 Environmental Matters.




     (a) Except as would not result in or would not reasonably be expected to result in a
Material Adverse Effect:




     (i) Each of the real properties owned, leased or operated by a Credit Party or
any of its Subsidiaries (the “Real Properties”) and all operations at the
Real Properties are in compliance with all applicable Environmental Laws, and there
is no violation of any Environmental Law with respect to the Real Properties or the
businesses operated by the Credit Parties or any of their Subsidiaries (the
“Businesses”), and there are no conditions relating to the Businesses or
Real Properties that would reasonably be expected to give rise to liability under
any applicable Environmental Laws.




     (ii) No Credit Party nor any of its Subsidiaries has received any written
notice of, or inquiry from any Governmental Authority regarding, any violation,
alleged violation, non-compliance, liability or potential liability regarding
Hazardous Materials or compliance with Environmental Laws with regard to any of the
Real Properties or the Businesses, nor, to the knowledge of a Credit Party or any of its Subsidiaries, is any such notice being
threatened.




     (iii) Hazardous Materials have not been transported or disposed of from the
Real Properties, or generated, treated, stored or disposed of at, on or under any of
the Real Properties or any other location, in each case by, or on behalf or with the
permission of, a Credit Party or any of its Subsidiaries in a manner that would give
rise to liability under any applicable Environmental Laws.




     (iv) No judicial proceeding or governmental or administrative action is pending
or, to the knowledge of a Credit Party or any of its Subsidiaries, threatened, under
any Environmental Law to which a Credit Party or any of its Subsidiaries is or will
be named as a party, nor are there any consent decrees or other decrees, consent
orders, administrative orders or other orders, or other administrative or judicial
requirements outstanding under any Environmental Law with respect to a Credit Party
or any of its Subsidiaries, the Real Properties or the Businesses.



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     (v) There has been no release (including, without limitation, disposal) or
threat of release of Hazardous Materials at or from the Real Properties, or arising
from or related to the operations of a Credit Party or any of its Subsidiaries in
connection with the Real Properties or otherwise in connection with the Businesses
where such release constituted a violation of, or would give rise to liability
under, any applicable Environmental Laws.




     (vi) None of the Real Properties contains, or has previously contained, any
Hazardous Materials at, on or under the Real Properties in amounts or concentrations
that, if released, constitute or constituted a violation of, or could give rise to
liability under, Environmental Laws.




     (vii) No Credit Party, nor any of its Subsidiaries, has assumed any liability
of any Person (other than another Credit Party, or one of its Subsidiaries) under
any Environmental Law.




     (b) The Credit Parties and its Subsidiaries have adopted procedures that are designed
to (i) ensure that such Credit Party or Subsidiary, any of its operations and each of the
Real Properties complies with applicable Environmental Laws and (ii) minimize any
liabilities or potential liabilities that each Credit Party or Subsidiary, any of its
operations and each of the Real Properties may have under applicable Environmental Laws.



     6.21 Intellectual Property.



     Each Credit Party and each of its Subsidiaries owns, or has the legal right to use, all
patents, trademarks, tradenames, copyrights, technology, know-how and processes (the
“Intellectual Property”) necessary for each of them to conduct its business as currently
conducted, except where failure to own or have such legal right to use would not have or would not
reasonably be expected to have a Material Adverse Effect. No claim has been asserted and is
pending by any Person challenging or questioning the use of any Intellectual Property owned by any
Credit Party or any of its Subsidiaries or that any Credit Party or any of its Subsidiaries has a
right to use or the validity or effectiveness of any such Intellectual Property, nor does any
Credit Party or any of its Subsidiaries have knowledge of any such claim, and, to the knowledge of
the Credit Parties and their Subsidiaries, the use of any Intellectual Property by the Credit
Parties and their Subsidiaries does not infringe on the rights of any Person, except for such
claims and infringements that in the aggregate, would not have or would not reasonably be expected
to have a Material Adverse Effect.



     6.22 Subsidiaries.



     Set forth on Schedule 6.22 is a complete and accurate list of all Subsidiaries of each
Credit Party. Schedule 6.22 may be updated from time to time by the Borrower by giving
written notice thereof to the Administrative Agent.



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     6.23 Solvency.



     Each Credit Party is and, after consummation of the transactions contemplated by this Credit
Agreement, will be Solvent.



     6.24 Indebtedness.



     The Credit Parties and their Subsidiaries have no Indebtedness other than Indebtedness
permitted by Section 8.1.



     6.25 Investments; Liens.



     All Investments of each Credit Party and its Subsidiaries are Permitted Investments. All
Liens on the property or assets of the Credit Parties and their Subsidiaries are Permitted Liens.



     6.26 Force Majeure.



     Since the date of the financial statements delivered in accordance with Section 5.1(d) or, if
later, the date of the most recent financial statements delivered in accordance with Section 7.1(a)
or Section 7.1(b), no event or condition has occurred that results from fire or other casualty,
strike, lockout or other labor disruption, embargo, sabotage, confiscation, condemnation, riot,
civil disturbance, activity of armed forces or act of God that has had or would reasonably be
expected to have a Material Adverse Effect.



SECTION 7




AFFIRMATIVE COVENANTS



     Each Credit Party hereby covenants and agrees that so long as this Credit Agreement is in
effect and until the Loans and LOC Obligations, together with interest and fees and other
obligations then due and payable hereunder, have been paid in full and the Commitments and Letters
of Credit hereunder shall have terminated:



     7.1 Information Covenants.



     The Credit Parties will furnish, or cause to be furnished, to the Administrative Agent (for
further distribution to the Lenders):




     (a) Annual Financial Statements. As soon as available, and in any event within
90 days after the close of each fiscal year of the Borrower, a consolidated balance sheet
and income statement of the Borrower and its Subsidiaries, as of the end of such fiscal
year, together with related consolidated statements of operations, retained earnings,
changes in



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shareholders’ equity and cash flows for such fiscal year, setting forth in
comparative form consolidated figures for the preceding fiscal year, all such consolidated
financial information described above to be in reasonable form and detail and audited by
independent certified public accountants of recognized national standing reasonably
acceptable to the Administrative Agent and whose opinion shall be to the effect that such
financial statements have been prepared in accordance with GAAP and shall not be limited as
to the scope of the audit or qualified in any manner.




     (b) Quarterly Financial Statements. As soon as available, and in any event
within 45 days after the close of each of the first three fiscal quarters of the Borrower,
an unaudited consolidated balance sheet and income statement of the Borrower and its
Subsidiaries, as of the end of such fiscal quarter, together with related consolidated
statements of operations and consolidated statements of retained earnings and of cash flows
for such fiscal quarter in each case setting forth in comparative form consolidated figures
for the corresponding period of the preceding fiscal year, all such financial information
described above to be in reasonable form and detail and reasonably acceptable to the
Administrative Agent, and accompanied by a certificate of an Authorized Officer of the
Borrower to the effect that such quarterly financial statements fairly present in all
material respects the consolidated financial condition of the Borrower and its Subsidiaries
and have been prepared in accordance with GAAP, subject to changes resulting from audit and
normal year-end audit adjustments.




     (c) Officer’s Certificate. At the time of delivery of the financial statements
provided for in Sections 7.1(a) and 7.1(b) above, a certificate of an Authorized Officer of
the Borrower substantially in the form of Exhibit 7.1(c), (i) demonstrating
compliance with the financial covenants contained in Section 7.2 by calculation thereof as
of the end of each such fiscal period, (ii) demonstrating compliance with any other terms of
this Credit Agreement as reasonably requested by the Administrative Agent, (iii) stating
that no Default or Event of Default exists, or if any Default or Event of Default does
exist, specifying the nature and extent thereof and what action the Borrower proposes to
take with respect thereto and (iv) calculating the Adjusted Leverage Ratio as of the end of
such fiscal period.




     (d) Annual Business Plan and Budgets. Within 90 days after the end of each
fiscal year of the Borrower, an annual business plan and budget (including budgeted Capital
Expenditures) of the Borrower and its Subsidiaries on a consolidated basis containing, among
other things, pro forma financial projections for the next fiscal year (including income
statements, balance sheets and cash flow statements).




     (e) Reports. Promptly upon transmission or receipt thereof, (a) copies of any
filings and registrations with, and reports to or from, the Securities and Exchange
Commission, or any successor agency, and copies of all financial statements, proxy
statements, notices and reports as a Credit Party or any of its Subsidiaries shall send to
its shareholders generally and (b) upon the written request of the Administrative Agent, all



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reports and written information to and from the United States Environmental Protection
Agency, or any state or local agency responsible for environmental matters, the United
States Occupational Safety and Health Administration, or any state or local agency
responsible for health and safety matters, or any successor agencies or authorities
concerning environmental, health or safety matters.




     (f) Accountant’s Certificate. Within the period for delivery of the annual
financial statements provided in Section 7.1(a), a certificate of the accountants conducting
the annual audit stating that they have reviewed this Credit Agreement and stating further
whether, in the course of their audit, they have become aware that the Borrower is not in
compliance with any of the affirmative or negative covenants set forth in Section 7 or
Section 8 of this Credit Agreement, insofar as such covenants relate to accounting matters
or are calculated based upon audited financial information.




     (g) Auditor’s Reports. Promptly upon receipt thereof, a copy of any other
report or “management letter” submitted or presented by independent accountants to any
Credit Party or any of its Subsidiaries in connection with any annual, interim or special
audit of the books of such Person.




     (h) Notices. Upon a Credit Party obtaining knowledge thereof, the Borrower
will give written notice to the Administrative Agent promptly (and in any event within two
Business Days) of (a) the occurrence of an event or condition consisting of a Default or
Event of Default, specifying the nature and existence thereof and what action the Borrower
proposes to take with respect thereto, (b) the occurrence of any of the following with
respect to any Credit Party or any of its Subsidiaries (i) the pendency or commencement of
any litigation, arbitration or governmental proceeding against a Credit Party or any of its
Subsidiaries which, if adversely determined, would have or would reasonably be expected to
have a Material Adverse Effect, (ii) material non-compliance with, or the institution of any
proceedings against a Credit Party or any of its Subsidiaries with respect to, or the
receipt of written notice by such Person of potential liability or responsibility for
violation, or alleged violation of, any Requirement of Law (including, without limitation,
Environmental Laws) the violation of which would have or would reasonably be expected to
have a Material Adverse Effect and (iii) non-compliance with any contractual obligation of a
Credit Party or any of its Subsidiaries which would have or would reasonably be expected to
have a Material Adverse Effect and (c) any change to the financial information used to
calculate the Adjusted Leverage Ratio for the most recently occurring Calculation Date that
would have the effect of changing the existing Pricing Level pursuant to the definition of
“Applicable Percentage” set forth in Section 1.1.




     (i) ERISA. Upon a Credit Party, any Subsidiary of a Credit Party or any ERISA
Affiliate obtaining knowledge thereof, such Person shall give written notice to the
Administrative Agent and each of the Lenders promptly (and in any event within two Business
Days) of: (i) any event or condition, including, but not limited to, any Reportable



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Event, that constitutes, or might reasonably lead to, an ERISA Event; (ii) with respect to any
Multiemployer Plan, the receipt of notice as prescribed in ERISA or otherwise of any
withdrawal liability assessed against a Credit Party, any Subsidiary of a Credit Party or
any ERISA Affiliate, or of a determination that any Multiemployer Plan is in reorganization
or insolvent (both within the meaning of Title IV of ERISA); (iii) the failure to make full
payment on or before the due date (including extensions) thereof of all amounts which a
Credit Party, any Subsidiary of a Credit Party or any ERISA Affiliate is required to
contribute to each Plan pursuant to its terms and as required to meet the minimum funding
standard set forth in ERISA and the Code with respect thereto; or (iv) any change in the
funding status of any Plan that could have a Material Adverse Effect; in each case together
with a description of any such event or condition or a copy of any such notice and a
statement by an Authorized Officer of the Borrower briefly setting forth the details
regarding such event, condition, or notice, and the action, if any, which has been or is
being taken or is proposed to be taken by such Person with respect thereto. Promptly upon
request, the Credit Parties shall furnish the Administrative Agent and the Lenders with such
additional information concerning any Plan as may be reasonably requested, including, but
not limited to, copies of each annual report/return (Form 5500 series), as well as all
schedules and attachments thereto required to be filed with the Department of Labor and/or
the Internal Revenue Service pursuant to ERISA and the Code, respectively, for each “plan
year” (within the meaning of Section 3(39) of ERISA).




     (j) Environmental. During the existence of an Event of Default, and upon the
written request of the Administrative Agent, the Credit Parties will furnish or cause to be
furnished to the Administrative Agent, at the Credit Parties’ expense, a report of an
environmental assessment of reasonable scope, form and depth, including, where appropriate,
invasive soil or groundwater sampling, by a consultant reasonably acceptable to the
Administrative Agent regarding any release or threat of release of Hazardous Materials on
any property owned, leased or operated by a Credit Party and the compliance by the Credit
Parties with Environmental Laws. If the Credit Parties fail to deliver such an
environmental report within seventy-five (75) days after receipt of such written request,
then the Administrative Agent may arrange for same, and the Credit Parties hereby grant to
the Administrative Agent and its representatives access to the Real Properties and a license
of a scope reasonably necessary to undertake such an assessment (including, where
appropriate, invasive soil or groundwater sampling). The reasonable cost of any assessment
arranged for by the Administrative Agent pursuant to this provision will be payable by the
Credit Parties on demand.




     (k) Other Information. With reasonable promptness upon any such request, such
other information regarding the business, properties or financial condition of the Credit
Parties and their Subsidiaries as the Administrative Agent or any Lender may reasonably
request.



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     7.2 Financial Covenants.




     (a) Tangible Net Worth. Tangible Net Worth shall at all times be greater than
or equal to the sum of (i) $219,000,000 plus (ii) 25% of Net Income (without deduction for
losses) earned for each fiscal quarter of the Borrower (beginning with the quarter ending
September 30, 2004) including the most recent fiscal quarter ending prior to the date of
determination plus (iii) 50% of the amount of Net Cash Proceeds from any Equity Issuance
occurring from the Effective Date to the last day of the most recent fiscal quarter ending
prior to the date of determination.




     (b) Leverage Ratio. The Leverage Ratio, as of the last day of each fiscal
quarter of the Borrower, shall be less than or equal to 2.25 to 1.0.




     (c) Interest Coverage Ratio. The Interest Coverage Ratio, as of the last day
of each fiscal quarter of the Borrower, shall be greater than or equal to 4.0 to 1.0.



     7.3 Preservation of Existence and Franchises.



     Each of the Credit Parties will, and will cause its Subsidiaries to, do all things necessary
to preserve and keep in full force and effect its existence and all material rights, franchises,
intellectual property and authority except as permitted by Section 8.5.



     7.4 Books and Records.



     Each of the Credit Parties will, and will cause its Subsidiaries to, keep complete and
accurate books and records of its transactions in accordance with GAAP (including the establishment
and maintenance of appropriate reserves).



     7.5 Compliance with Law.



     Each of the Credit Parties will, and will cause its Subsidiaries to, comply with all material
Requirements of Law, and all material restrictions imposed by all Governmental Authorities,
applicable to it and its property (including, without limitation, Environmental Laws and ERISA).



     7.6 Payment of Taxes and Other Indebtedness.



     Each of the Credit Parties will, and will cause its Subsidiaries to, pay, settle or discharge
(a) all material taxes, assessments and governmental charges or levies imposed upon it, or upon its
income or profits, or upon any of its properties, before they shall become delinquent, (b) all
lawful claims (including claims for labor, materials and supplies) which, if unpaid, might give
rise to a Lien upon any of its properties, and (c) all of its other Indebtedness as it shall become
due (to the extent such repayment is not otherwise prohibited by this Credit Agreement);
provided, however,



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that a Credit Party shall not be required to pay any such tax,
assessment, charge, levy, claim or Indebtedness which is being contested in good faith by
appropriate proceedings and as to which adequate reserves therefor have been established in
accordance with GAAP, unless the failure to make any such payment (i) would give rise to an
immediate right to foreclose or collect on a Lien securing such amounts or (ii) would have or would
reasonably be expected to have a Material Adverse Effect.




     7.7 Insurance.



     Each of the Credit Parties will, and will cause each of its Subsidiaries to, at all times
maintain in full force and effect insurance (including liability, casualty and business
interruption insurance) with reputable national companies that are not Affiliates of the Borrower,
in such amounts, covering such risks and liabilities and with such deductibles and self-insurance
retentions as are in accordance with normal industry practice; provided that the Borrower
may maintain a program of self-insurance with respect to products liability and worker’s
compensation liability.



     7.8 Maintenance of Property.



     Each of the Credit Parties will, and will cause its Subsidiaries to, maintain and preserve its
properties and equipment in good repair, working order and condition, normal wear and tear and
damages from casualty excepted, and will make, or cause to be made, in such properties and
equipment from time to time all repairs, renewals, replacements, extensions, additions, betterments
and improvements thereto as may be needed or proper, to the extent and in the manner customary for
companies in similar businesses.



     7.9 Performance of Obligations.



     Each of the Credit Parties will, and will cause its Subsidiaries to, perform in all material
respects all of its obligations under the terms of all material contracts, agreements, indentures,
mortgages, security agreements or other debt instruments to which it is a party or by which it or
its properties may be bound.



     7.10 Use of Proceeds.



     The Credit Parties will use the proceeds of the Loans solely (a) to repay Indebtedness of the
Borrower identified in Section 5.1(g), (b) to provide working capital for the Borrower and (c) for
general corporate purposes of the Borrower. The Borrower will use the Letters of Credit solely for
the purposes set forth in Section 2.2(a).



     7.11 Audits/Inspections.



     Upon reasonable notice and during normal business hours, at the Credit Parties’ expense, each
Credit Party will, and will cause each of its Subsidiaries to, permit representatives appointed



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by the Administrative Agent or any Lender, including, without limitation, independent accountants,
agents, attorneys and appraisers to visit and inspect such Credit Party’s or Subsidiary’s property,
including its books and records, its accounts receivable and inventory, its facilities and its
other business assets, and to make photocopies or photographs thereof and to write down and record
any information such representative obtains and shall permit the Administrative Agent, any Lender
or its representatives to investigate and verify the accuracy of information provided to the
Administrative Agent or the Lenders and to discuss all such matters with the officers,
employees and representatives of the Credit Parties and/or their
Subsidiaries; provided however that, unless an Event of Default shall exist and be
continuing, the Administrative Agent and the Lenders shall not, in the aggregate, exercise their
rights under this Section 7.11 more than two times during any calendar year and only one such time
shall be at the Credit Parties’ expense. Notwithstanding the foregoing, no information protected
by an attorney-client privilege shall be required to be disclosed pursuant to this Section 7.11;
provided however that in the event any Credit Party claims that any materials
requested for review, investigation or discussion by the Administrative Agent or any Lender, or any
of its representatives pursuant to this Section 7.11 is protected by an attorney-client privilege,
then such Credit party shall (a) provide the Administrative Agent or such Lender with a reasonably
acceptable basis for the assertion of the privilege, (b) remove or redact only those portions of
the materials deemed to be privileged and (c) reasonably cooperate with the Administrative Agent or
such Lender to determine a method by which the information which the Administrative Agent or such
Lender reasonably deemed necessary to review, investigate or discuss may be obtained by the
Administrative Agent in an alternative method which will not jeopardize any attorney-client
privilege.




     7.12 Additional Credit Parties.



     At the time any Person becomes a Domestic Subsidiary, the Borrower shall so notify the
Administrative Agent and promptly thereafter (but in any event within 30 days) shall cause such
Person to (a) execute a Joinder Agreement in substantially the same form as Exhibit 7.12,
(b) deliver such other documentation as the Administrative Agent may reasonably request in
connection with the foregoing, including, without limitation, certified resolutions and other
organizational and authorizing documents of such Person and favorable opinions of counsel to such
Person (which shall cover, among other things, the legality, validity, binding effect and
enforceability of the documentation referred to above), all in form, content and scope reasonably
satisfactory to the Administrative Agent and (c) update such schedules to the Credit Agreement as
appropriate to reflect the joinder of such new Domestic Subsidiary.




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SECTION 8




NEGATIVE COVENANTS



     Each Credit Party hereby covenants and agrees that so long as this Credit Agreement is in
effect and until the Loans and LOC Obligations, together with interest, fees and other obligations
then due and payable hereunder, have been paid in full and the Commitments and Letters of Credit
hereunder shall have terminated:



     8.1 Indebtedness.



     Subject to Section 8.2, no Credit Party will, nor will it permit any of its Subsidiaries to,
contract, create, incur, assume or permit to exist any Indebtedness, other than:




     (a) Indebtedness arising under this Credit Agreement and the other Credit Documents;




     (b) Indebtedness in respect of current accounts payable and accrued expenses incurred
in the ordinary course of business and to the extent not current, accounts payable and
accrued expenses that are subject to bona fide dispute and against which adequate reserves
have been established in accordance with GAAP;




     (c) Indebtedness owing by a Credit Party to another Credit Party;




     (d) purchase money Indebtedness (including Capital Leases) to finance the purchase of
fixed assets (including equipment); provided that (i) the sum of (A) the total
amount of all such Indebtedness outstanding for the Credit Parties and their Subsidiaries
plus (B) the aggregate amount of Synthetic Leases outstanding pursuant to clause (e) below
shall not exceed an aggregate principal amount of $30,000,000 at any one time outstanding;
(ii) such Indebtedness when incurred shall not exceed the purchase price of the asset(s)
financed; and (iii) no such Indebtedness shall be refinanced for a principal amount in
excess of the principal balance outstanding thereon at the time of such refinancing;




     (e) Indebtedness comprised of Synthetic Leases; provided that the sum of (i) the total
amount of all such Indebtedness for the Credit Parties and their Subsidiaries outstanding
plus (ii) the aggregate amount of purchase money Indebtedness outstanding pursuant to clause
(d) above shall not exceed an aggregate principal amount of $30,000,000 at any one time
outstanding.




     (f) Indebtedness owing by a Foreign Subsidiary to another Foreign Subsidiary or to a
Credit Party;



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     (g) Indebtedness of the Foreign Subsidiaries in addition to clause (f) above in an
amount not to exceed $25,000,000 in the aggregate at any one time outstanding;




     (h) reimbursement obligations with respect to draws under letters of credit issued to
(i) provide for, or to ensure, the payment of the purchase prices of goods acquired by a
Credit Party or any of its Subsidiaries or (ii) support obligations of a Credit Party or any
of its Subsidiaries provided that such reimbursement obligations are paid in full on
the dates the financial institutions that issued such letters of credit pay the draws;




     (i) Guaranty Obligations permitted by Section 8.2;




     (j) Indebtedness evidenced by Hedging Agreements entered into in the ordinary course of
business and not for speculative purposes;




     (k) Indebtedness set forth on Schedule 8.1(k); and




     (l) other unsecured Funded Debt of a Credit Party; provided that the principal
amount of such unsecured Funded Debt, if deemed included in the calculation of the Leverage
Ratio as of the last day of the most recently ended fiscal quarter, would not cause the
Leverage Ratio to exceed 2.25 to 1.0 on such date.



     8.2 Guaranty Obligations.



     Notwithstanding anything in Section 8.1 to the contrary, no Credit Party will, nor will it
permit its Subsidiaries to contract, create, incur, assume or permit to exist any Guaranty
Obligation other than:




     (a) the obligation of such Person to purchase the property of another Person from a
creditor of such other Person who has repossessed such property as a result of a default by
such other Person under a dealer floor-plan financing arrangement with such creditor,
pursuant to those repurchase agreements existing on the Closing Date as set forth on
Schedule 8.2(a);




     (b) Guaranty Obligations of any Subsidiary of the Borrower with respect to any Hedging
Agreement entered into by the Borrower with a Lender or an Affiliate of a Lender;




     (c) Guaranty Obligations of any Subsidiary of the Borrower with respect to any letter
of credit that is issued by a Lender or an Affiliate of a Lender for the account of the
Borrower;




     (d) the liability, or potential liability, of (i) PAI as a general partner of
Acceptance Partnership and (ii) the Borrower and PAI consisting of obligations to make
capital contributions, in an amount not to exceed the sum of (A) the existing obligations
set



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forth on Schedule 8.2(d) plus (B) an additional $30,000,000 incurred during the
term of this Credit Agreement; and




     (e) obligations under the Revolving Program Agreement; provided that the
Polaris Participation Fee Shortfall Obligations shall not exceed $60,000,000, in the
aggregate, at any one time; and




     (f) other Guaranty Obligations of the Credit Parties in an aggregate amount not to
exceed $15,000,000.



     8.3 Liens.



     No Credit Party will, nor will it permit its Subsidiaries to, contract, create, incur, assume
or permit to exist any Lien with respect to any of its property or assets of any kind (whether real
or personal, tangible or intangible), whether now owned or after acquired, other than Permitted
Liens.



     8.4 Nature of Business.



     No Credit Party will, nor will it permit its Subsidiaries to, alter the character of its
business from that conducted as of the Closing Date or engage in any business other than the
business conducted as of the Effective Date and activities which are substantially similar or
related thereto.



     8.5 Consolidation and Merger.



     No Credit Party will, nor will it permit any Subsidiary to, enter into any transaction of
merger or consolidation or liquidate, wind up or dissolve itself, or suffer any such liquidation,
wind-up or dissolution; provided that a Credit Party or a Subsidiary of a Credit Party may
merge or consolidate with or into another Person if the following conditions are satisfied:




     (a) the Administrative Agent is given prior written notice of such action;




     (b) if the merger or consolidation involves a Credit Party, the surviving entity of
such merger or consolidation shall either (i) be such Credit Party or (ii) be a Subsidiary
of the Borrower and expressly assumes in writing all of the obligations of such Credit Party
under the Credit Documents; provided that if the transaction is between the Borrower
and another Person, the Borrower must be the surviving entity;




     (c) the Credit Parties execute and deliver such documents, instruments and certificates
as the Administrative Agent may request;




     (d) immediately after giving effect to such transaction, no Default or Event of Default
shall have occurred and be continuing; and



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     (e) the Borrower delivers to the Administrative Agent an officer’s certificate stating
that such consolidation or merger, and any written agreement entered into in connection
therewith, comply with this Section 8.5.



     8.6 Sale or Lease of Assets.



     No Credit Party will, nor will it permit its Subsidiaries to, convey, sell, lease, transfer or
otherwise voluntarily dispose of, in one transaction or a series of transactions, all or any part
of its business or assets whether now owned or hereafter acquired, including, without limitation,
inventory, receivables, equipment, real property interests (whether owned or leasehold) and securities, other than a sale, lease, transfer or other disposal (a) by a
Credit Party of any or all of its assets to another Credit Party; (b) of inventory in the ordinary
course of business; (c) of obsolete, slow-moving, idle or worn-out assets no longer used or useful
in the business of such Credit Party or the trade-in of equipment for equipment in better condition
or of better quality; (d) which constitutes a Permitted Investment in the ordinary course of
business; (e) by PAI of its partnership interest in Acceptance Partnership if required by Section
3.4 of the Acceptance Partnership Agreement (without regard to any amendment of such section); (f)
of accounts receivable pursuant to the financing contracts set forth on Schedule 8.6 or any
replacement arrangement with the same economic effect; and (g) of assets of the Credit Parties and
their Subsidiaries after the Closing Date, in addition to those permitted above in this Section
8.6; provided that (i) the transfer is for fair market value, (ii) no Default or Event of Default
exists either prior to or after giving effect thereto and (iii) after giving effect thereto, the
aggregate amount of all such transfers during the term of this Credit Agreement, calculated on a
net book value basis, does not exceed ten percent (10%) of Total Assets, as determined on the last
day of the most recently ended fiscal year of the Borrower.



     8.7 Sale Leasebacks.



     No Credit Party will, nor will it permit its Subsidiaries to, directly or indirectly become or
remain liable as lessee or as guarantor or other surety with respect to any lease of any property
(whether real or personal or mixed), whether now owned or hereafter acquired, (a) which such Credit
Party or its Subsidiary has sold or transferred or is to sell or transfer to any other Person other
than a Credit Party or (b) which such Credit Party or its Subsidiary intends to use for
substantially the same purpose as any other property which has been sold or is to be sold or
transferred by such Credit Party to any Person in connection with such lease, other than such
transactions permitted by the Required Lenders.



     8.8 Investments.



     No Credit Party will, nor will it permit its Subsidiaries to, make or permit to exist any
Investments except for Permitted Investments.



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     8.9 Foreign Subsidiaries.



     No Credit Party will, nor will it permit its Subsidiaries to, permit the aggregate amount of
assets owned by the Foreign Subsidiaries, at any one time, to constitute more than twenty percent
(20%) of Total Assets.



     8.10 Transactions with Affiliates.



     No Credit Party will, nor will it permit its Subsidiaries to, enter into any transaction or
series of transactions, whether or not in the ordinary course of business, with any officer,
director, shareholder, Subsidiary or Affiliate other than the normal compensation, indemnification
and reimbursement of expenses of officers, employees and directors and transactions on terms and
conditions substantially as favorable as would be obtainable in a comparable arm’s-length
transaction with a Person other than an officer, director, shareholder, Subsidiary or Affiliate.



     8.11 Fiscal Year; Accounting; Organizational Documents.



     No Credit Party will, nor will it permit its Subsidiaries to, (a) change its fiscal year, (b)
change its accounting procedures, except as a result of changes in GAAP and in accordance with
Section 1.3 or (c) in any manner that would reasonably be likely to adversely affect the rights of
the Lenders, change its organizational or governing documents.



     8.12 No Limitations.



     No Credit Party will, nor will it permit its Subsidiaries to, directly or indirectly, create
or otherwise cause, incur, assume, suffer or permit to exist or become effective any consensual
encumbrance or restriction of any kind on the ability of any such Person to (a) pay dividends or
make any other distribution on any of such Person’s Capital Stock, (b) pay any Indebtedness owed to
any other Credit Party, (c) make loans or advances to any other Credit Party or (d)
transfer any of its property to any other Credit Party, except for encumbrances or restrictions
existing under or by reason of (i) customary non-assignment provisions in any lease governing a
leasehold interest and (ii) this Credit Agreement and the other Credit Documents.



     8.13 No Other Negative Pledges.



     No Credit Party will, nor will it permit its Subsidiaries to, enter into, assume or become
subject to any agreement prohibiting or otherwise restricting the creation or assumption of any
Lien upon its properties or assets, whether now owned or hereafter acquired, or requiring the grant
of any security for such obligation if security is given for some other obligation except as set
forth in the Credit Documents.



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     8.14 PAI Assets.



     No Credit Party will, nor will it permit any Subsidiary to, allow PAI to own any assets other
than equity interests in Acceptance Partnership and dividends or other distributions derived
therefrom; provided that PAI shall transfer any such dividends or distributions to Polaris
Industries Inc. or the Borrower within 15 Business Days of receipt.



SECTION 9




EVENTS OF DEFAULT



     9.1 Events of Default.



     An Event of Default shall exist upon the occurrence, and during the continuation, of any of
the following specified events (each an “Event of Default”):




     (a) Payment. Any Credit Party shall default in the payment (i) when due of any
principal of any of the Loans or any reimbursement obligation arising from drawings under
Letters of Credit or (ii) within three Business Days of when due of any interest on the
Loans or any fees or other amounts owing hereunder, under any of the other Credit Documents
or in connection herewith.




     (b) Representations. Any representation, warranty or statement made or deemed
to be made by any Credit Party herein, in any of the other Credit Documents, or in any
statement or certificate delivered or required to be delivered pursuant hereto or thereto
shall prove untrue in any material respect on the date as of which it was made or deemed to
have been made.




     (c) Covenants. Any Credit Party shall:




     (i) default in the due performance or observance of any term, covenant or
agreement contained in Sections 7.2, 7.3, 7.5, 7.10, 7.11 or 7.12 or Section 8
inclusive;




     (ii) default in the due performance or observance by it of any term, covenant
or agreement contained in Section 7.1 and such default shall continue unremedied for
a period of five Business Days; or




     (iii) default in the due performance or observance by it of any term, covenant
or agreement (other than those referred to in subsections (a), (b) or (c)(i) or (ii)
of this Section 9.1) contained in this Credit Agreement and such default shall
continue unremedied for a period of at least 30 days after the earlier of the
President,



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Chief Executive Officer, Chief Financial Officer or Treasurer of the
Borrower becoming aware of such default or notice thereof given by the
Administrative Agent.




     (d) Other Credit Documents. (i) Any Credit Party shall default in the due
performance or observance of any term, covenant or agreement in any of the other Credit
Documents and such default shall continue unremedied for a period of at least 30 days after
the earlier of an officer of a Credit Party becoming aware of such default or notice thereof
given by the Administrative Agent, (ii) any Credit Document shall fail to be in full force
and effect or any Credit Party shall so assert or (iii) any Credit Document shall fail to
give the Administrative Agent and/or the Lenders the liens, rights, powers and privileges
purported to be created by such Credit Document.




     (e) Guaranties. The Guaranty given by the Credit Parties hereunder or by any
Additional Credit Party or any provision thereof shall cease to be in full force and effect,
or any Guarantor or any Person acting by or on behalf of such Guarantor shall deny or
disaffirm such Guarantor’s obligations under such guaranty or such Guarantor shall default
in the due payment or performance of such Guaranty.




     (f) Bankruptcy, etc. The occurrence of any of the following with respect to a
Credit Party or any of its Subsidiaries (i) a court or governmental agency having
jurisdiction in the premises shall enter a decree or order for relief in respect of a Credit
Party or any of its Subsidiaries in an involuntary case under any applicable bankruptcy,
insolvency or other similar law now or hereafter in effect, or appoint a receiver,
liquidator, assignee, custodian, trustee, sequestrator, administrator or similar official of
a Credit Party or any of its Subsidiaries or for any substantial part of its property or
ordering the winding up or liquidation of, or an administrator in respect of, its affairs;
or (ii) an involuntary case under any applicable bankruptcy, insolvency or other similar law
now or hereafter in effect is commenced against a Credit Party or any of its Subsidiaries
and such petition remains unstayed and in effect for a period of 60 consecutive days; or
(iii) a Credit Party or any of its Subsidiaries shall commence a voluntary case under any
applicable bankruptcy, insolvency or other similar law now or hereafter in effect, or
consent to the entry of an order for relief in an involuntary case under any such law, or
consent to the appointment or taking possession by a receiver, liquidator, assignee,
custodian, trustee, sequestrator, administrator or similar official of such Person or any
substantial part of its property or make any general assignment for the benefit of
creditors; or (iv) a Credit Party or any of its Subsidiaries shall fail generally, or shall
admit in writing its inability, to pay its debts as they become due or any action shall be
taken by such Person in furtherance of any of the aforesaid purposes.




     (g) Defaults under Other Agreements.




     (i) A Credit Party or any of its Subsidiaries shall default in the due
performance or observance (beyond any applicable grace period with respect



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thereto) of any material obligation or condition of any contract or lease to which it is a
party, including, but not limited to, any Hedging Agreement; or




     (ii) With respect to any Indebtedness in excess of $10,000,000 (other than
Indebtedness outstanding under this Credit Agreement) of a Credit Party or any of
its Subsidiaries (A) such Person shall (x) default in any payment (beyond the
applicable grace period with respect thereto, if any) with respect to any such
Indebtedness, or (y) default (after giving effect to any applicable grace period) in
the observance or performance relating to such Indebtedness or contained in any
instrument or agreement evidencing, securing or relating thereto, or any other event
or condition shall occur or condition exist, the effect of which default or other
event or condition is to cause, or permit, the holder or holders of such
Indebtedness (or trustee or agent on behalf of such holders, if any) to require
(determined without regard to whether any notice or lapse of time is required) any
such Indebtedness to become due prior to its stated maturity; or (B) any such
Indebtedness shall be declared due and payable, or required to be prepaid other than
by a regularly scheduled required prepayment prior to the stated maturity thereof;
or (C) any such Indebtedness shall mature and remain unpaid.




     (h) Judgments. One or more judgments, orders, or decrees shall be entered
against any one or more of the Credit Parties and their Subsidiaries involving a liability
of $10,000,000 or more, in the aggregate, (to the extent not paid or covered by insurance provided by a carrier who has acknowledged
coverage) and such judgments, orders or decrees (i) are the subject of any enforcement
proceeding commenced by any creditor or (ii) shall continue unsatisfied, undischarged and
unstayed for a period ending on the first to occur of (A) the last day on which such
judgment, order or decree becomes final and unappealable or (B) 60 days.




     (i) ERISA. The occurrence of any of the following events or conditions: (i)
any “accumulated funding deficiency,” as such term is defined in Section 302 of ERISA and
Section 412 of the Code, whether or not waived, shall exist with respect to any Plan, or any
Lien shall arise on the assets of a Credit Party, any Subsidiary of a Credit Party or any
ERISA Affiliate in favor of the PBGC or a Plan; (ii) an ERISA Event shall occur with respect
to a Single Employer Plan, which is, in the reasonable opinion of the Administrative Agent,
likely to result in the termination of such Plan for purposes of Title IV of ERISA; (iii) an
ERISA Event shall occur with respect to a Multiemployer Plan or Multiple Employer Plan,
which is, in the reasonable opinion of the Administrative Agent, likely to result in (A) the
termination of such Plan for purposes of Title IV of ERISA, or (B) a Credit Party, any
Subsidiary of a Credit Party or any ERISA Affiliate incurring any liability in connection
with a withdrawal from, reorganization of (within the meaning of Section 4241 of ERISA), or
insolvency (within the meaning of Section 4245 of ERISA) of such Plan; (iv) any prohibited
transaction (within the meaning of Section 406 of ERISA or Section 4975 of the Code) or
breach of fiduciary responsibility shall occur which may subject a Credit Party,



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any
Subsidiary of a Credit Party or any ERISA Affiliate to any liability under Sections 406,
409, 502(i), or 502(l) of ERISA or Section 4975 of the Code, or under any agreement or other
instrument pursuant to which a Credit Party, any Subsidiary of a Credit Party or any ERISA
Affiliate has agreed or is required to indemnify any Person against any such liability; or
(v) a Credit Party, any Subsidiary of a Credit Party or any ERISA Affiliate fails to pay
when due, after the expiration of any applicable grace period, any installment payment with
respect to its withdrawal liability under Section 4201 of ERISA under a Multiemployer Plan
in an aggregate amount in excess of $500,000.




     (j) Ownership. There shall occur a Change of Control.




     (k) Condemnation. All or substantially all of the property of a Credit Party
or any of its Subsidiaries shall become subject to a condemnation, taking or other
appropriation action by any Governmental Authority.



     9.2 Acceleration; Remedies.



     Upon the occurrence and during the continuation of an Event of Default, the Administrative
Agent may or shall, upon the request and direction of the Required Lenders, take the following
actions without prejudice to the rights of the Administrative Agent or any Lender to enforce its
claims against the Credit Parties, except as otherwise specifically provided for herein:




     (a) Termination of Commitments. Declare the Commitments terminated whereupon
the Commitments shall be immediately terminated.




     (b) Acceleration of Loans. Declare the unpaid principal of and any accrued
interest in respect of all Loans, any reimbursement obligations arising from drawings under
Letters of Credit and any and all other Indebtedness or obligations of any and every kind
owing by a Credit Party to any of the Lenders under the Credit Documents to be due whereupon
the same shall be immediately due and payable without presentment, demand, protest or other
notice of any kind, all of which are hereby waived by the Credit Parties.




     (c) Cash Collateral. Direct the Borrower to Cash Collateralize (and the
Borrower agrees that upon receipt of such notice, or upon the occurrence of an Event of
Default under Section 9.1(f), it will immediately Cash Collateralize) all then outstanding
Letters of Credit in an amount equal to the maximum aggregate amount which may be drawn
under all Letters of Credits then outstanding. The Borrower will grant to the Administrative
Agent, for the benefit of the Issuing Lender and the Lenders, a security interest in all
such cash, deposit accounts and all balances therein and all proceeds of the foregoing. The
cash collateral shall be maintained in blocked, non-interest bearing deposit accounts at Bank of America as
additional security for the LOC Obligations.



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     (d) Enforcement of Rights. Enforce any and all rights and interests created
and existing under the Credit Documents, including, without limitation, all rights and
remedies against a Guarantor and all rights of set-off.


Notwithstanding the foregoing, if an Event of Default specified in Section 9.1(f) shall occur, then
the Commitments shall automatically terminate and all Loans, all reimbursement obligations under
Letters of Credit, all accrued interest in respect thereof, all accrued and unpaid fees and other
indebtedness or obligations owing to the Lenders hereunder shall immediately become due and payable
without the giving of any notice or other action by the Administrative Agent or the Lenders, which
notice or other action is expressly waived by the Credit Parties.



Notwithstanding the fact that enforcement powers reside primarily with the Administrative Agent,
each Lender has, to the extent permitted by law, a separate right of payment and shall be
considered a separate “creditor” holding a separate “claim” within the meaning of Section 101(5) of
the Bankruptcy Code or any other insolvency statute.




     9.3 Allocation of Payments After Event of Default.



     Notwithstanding any other provisions of this Credit Agreement, after the occurrence and during
the continuation of an Event of Default and the exercise of remedies by the Administrative Agent or
the Lenders pursuant to Section 9.2 (or after the Commitments shall automatically terminate and the
Loans (with accrued interest thereon) and all other amounts under the Credit Documents shall
automatically become due and payable in accordance with the terms of such Section), all amounts
collected or received by the Administrative Agent or any Lender on account of amounts outstanding
under any of the Credit Documents shall be paid over or delivered as follows:




     FIRST, to the payment of all reasonable out-of-pocket costs and expenses (including
without limitation reasonable Attorney Costs) of the Administrative Agent, the Issuing
Lender or any of the Lenders in connection with enforcing the rights of the Lenders under
the Credit Documents, pro rata as set forth below;




     SECOND, to payment of any fees owed to the Administrative Agent, the Issuing Lender or
any Lender, pro rata as set forth below;




     THIRD, to the payment of all accrued interest payable to the Lenders hereunder, pro
rata as set forth below;




     FOURTH, to the payment of the outstanding principal amount of the Loans and
unreimbursed drawings under Letters of Credit, and to the payment or to Cash Collateralize
the outstanding LOC Obligations, pro rata as set forth below;



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     FIFTH, to all other obligations which shall have become due and payable under the
Credit Documents and not repaid pursuant to clauses “FIRST” through “FOURTH” above;




     SIXTH, to any principal amounts outstanding under Hedging Agreements between a Credit
Party and a Lender or Affiliate of a Lender, pro rata as set forth below; and




     SEVENTH, to the payment of the surplus, if any, to whoever may be lawfully entitled to
receive such surplus.


In carrying out the foregoing, (a) amounts received shall be applied in the numerical order
provided until exhausted prior to application to the next succeeding category; (b) each of the
Lenders shall receive an amount equal to its pro rata share (based on the proportion that the then
outstanding Loans, and LOC Obligations held by such Lender bears to the aggregate then outstanding
Loans and LOC Obligations, or, in the case of clause “SIXTH” above, the proportion of then
outstanding obligations under Hedging Agreements) of amounts available to be applied; and (c) to
the extent that any amounts available for distribution pursuant to clause “FOURTH” above are
attributable to the issued but undrawn amount of outstanding Letters of Credit, such amounts shall
be held by the Administrative Agent in a cash collateral account and applied (i) first, to
reimburse the Issuing Lender from time to time for any drawings under such Letters of Credit and
(ii) then, following the expiration of all Letters of Credit, to all other obligations of the types
described in clauses “FOURTH”, “FIFTH” and “SIXTH” above in the manner provided in this Section
9.3.




SECTION 10




AGENCY PROVISIONS



     10.1 Appointment.




     (a) Each Lender hereby irrevocably appoints, designates and authorizes the
Administrative Agent to take such action on its behalf under the provisions of this Credit
Agreement and each other Credit Document and to exercise such powers and perform such duties
as are expressly delegated to it by the terms of this Credit Agreement or any other Credit
Document, together with such powers as are reasonably incidental thereto. Notwithstanding
any provision to the contrary contained elsewhere herein or in any other Credit Document,
the Administrative Agent shall not have any duties or responsibilities, except those
expressly set forth herein, nor shall the Administrative Agent have or be deemed to have any
fiduciary or trustee relationship with any Lender or participant, and no implied covenants,
functions, responsibilities, duties, obligations or liabilities shall be read into this
Credit Agreement or any other Credit Document or otherwise exist against the Administrative
Agent. Without limiting the generality of the foregoing sentence, the use of the term
“agent” herein and in the other Credit Documents with reference to the



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Administrative Agent
is not intended to connote any fiduciary or other implied (or express) obligations arising
under agency doctrine of any applicable law. Instead, such term is used merely as a matter
of market custom, and is intended to create or reflect only an administrative relationship
between independent contracting parties.




     (b) The Issuing Lender shall act on behalf of the Lenders with respect to any Letters
of Credit issued by it and the documents associated therewith until such time (and except
for so long) as the Administrative Agent may agree at the request of the Required Lenders to
act for the Issuing Lender with respect thereto; provided, however, that the
Issuing Lender shall have all of the benefits and immunities (i) provided to the
Administrative Agent in this Section 10 with respect to any acts taken by or omissions of
the Issuing Lender in connection with Letters of Credit issued by it or proposed to be
issued by it and the application and agreements for letters of credit pertaining to the
Letters of Credit as fully as if the term “Administrative Agent” as used in this Section 10
included the Issuing Lender with respect to such acts or omissions, and (ii) as additionally
provided herein with respect to the Issuing Lender.




     (c) None of the Lenders identified on the facing page or signature pages of this Credit
Agreement as a “syndication agent”, “documentation agent”, “book manager” or other title
shall have any right, power, obligation, liability, responsibility or duty under this Credit
Agreement or the other Credit Documents other than those applicable to all Lenders as such.
Without limiting the foregoing, none of the Lenders so identified shall have or be deemed to
have any fiduciary relationship with any Lender. Each Lender acknowledges that it has not
relied, and will not rely, on any of the Lenders so identified in deciding to enter into
this Credit Agreement or the other Credit Documents or in taking or not taking action
hereunder.



     10.2 Delegation of Duties.



     The Administrative Agent may execute any of its duties under this Credit Agreement or any
other Credit Document by or through agents, employees or attorneys-in-fact and shall be entitled to
advice of counsel and other consultants or experts concerning all matters pertaining to such duties. The Administrative Agent
shall not be responsible for the negligence or misconduct of any agent or attorney-in-fact that it
selects with reasonable care.



     10.3 Exculpatory Provisions.



     No Agent-Related Person shall (a) be liable for any action taken or omitted to be taken by any
of them under or in connection with this Credit Agreement or any other Credit Document or the
transactions contemplated hereby (except for its own gross negligence or willful misconduct in
connection with its duties expressly set forth herein), or (b) be responsible in any manner to any
Lender or participant for any recital, statement, representation or warranty made by any Credit
Party or any officer thereof, contained herein or in any other Credit Document, or in any



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certificate, report, statement or other document referred to or provided for in, or received by the
Administrative Agent under or in connection with, this Credit Agreement or any other Credit
Document, or the validity, effectiveness, genuineness, enforceability or sufficiency of this Credit
Agreement or any other Credit Document, or for any failure of any Credit Party or any other party
to any Credit Document to perform its obligations hereunder or thereunder. No Agent-Related Person
shall be under any obligation to any Lender or participant to ascertain or to inquire as to the
observance or performance of any of the agreements contained in, or conditions of, this Credit
Agreement or any other Credit Document, or to inspect the properties, books or records of any
Credit Party or any Affiliate thereof.




     10.4 Reliance on Communications.




     (a) The Administrative Agent shall be entitled to rely, and shall be fully protected in
relying, upon any writing, communication, signature, resolution, representation, notice,
consent, certificate, affidavit, letter, telegram, facsimile, telex or telephone message,
electronic mail message, statement or other document or conversation believed by it to be
genuine and correct and to have been signed, sent or made by the proper Person or Persons,
and upon advice and statements of legal counsel (including counsel to any Credit Party),
independent accountants and other experts selected by the Administrative Agent. The
Administrative Agent may deem and treat each Lender as the owner of the interests hereunder
for all purposes unless a written notice of assignment, negotiation or transfer thereof
shall have been delivered to the Administrative Agent in accordance with Section 11.3(b).
The Administrative Agent shall be fully justified in failing or refusing to take any action
under any Credit Document unless it shall first receive such advice or concurrence of the
Required Lenders as it deems appropriate and, if it so requests, it shall first be
indemnified to its satisfaction by the Lenders against any and all liability and expense
which may be incurred by it by reason of taking or continuing to take any such action. The
Administrative Agent shall in all cases be fully protected in acting, or in refraining from
acting, under this Credit Agreement or any other Credit Document in accordance with a
request or consent of the Required Lenders or all the Lenders, if required hereunder, and
such request and any action taken or failure to act pursuant thereto shall be binding upon
all the Lenders and participants, and their respective successors and assigns. Where this
Credit Agreement expressly permits or prohibits an action unless the Required Lenders
otherwise determine, the Administrative Agent shall, and in all other instances, the
Administrative Agent may, but shall not be required to, initiate any solicitation for the
consent or a vote of the Lenders.




     (b) For purposes of determining compliance with the conditions specified in Section
5.1, each Lender that has signed this Credit Agreement shall be deemed to have consented to,
approved or accepted or to be satisfied with, each document or other matter either sent by
the Administrative Agent to such Lender for consent, approval, acceptance or satisfaction,
or required thereunder to be consented to or approved by or acceptable or satisfactory to a
Lender.



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     10.5 Notice of Default.



     The Administrative Agent shall not be deemed to have knowledge or notice of the occurrence of
any Default or Event of Default, except with respect to defaults in the payment of principal,
interest and fees required to be paid to the Administrative Agent for the account of the Lenders,
unless the Administrative Agent shall have received written notice from a Lender or the Borrower referring to this Credit Agreement,
describing such Default or Event of Default and stating that such notice is a “notice of default.”
The Administrative Agent will notify the Lenders of its receipt of any such notice. The
Administrative Agent shall take such action with respect to such Default or Event of Default as may
be reasonably directed by the Required Lenders in accordance with Section 9.2; provided,
however, that unless and until the Administrative Agent has received any such direction,
the Administrative Agent may (but shall not be obligated to) take such action, or refrain from
taking such action, with respect to such Default or Event of Default as it shall deem advisable or
in the best interest of the Lenders.



     10.6 Non-Reliance on Administrative Agent and Other Lenders.



     Each Lender acknowledges that no Agent-Related Person has made any representation or warranty
to it, and that no act by the Administrative Agent hereinafter taken, including any consent to and
acceptance of any assignment or review of the affairs of any Credit Party or any Affiliate thereof,
shall be deemed to constitute any representation or warranty by any Agent-Related Person to any
Lender as to any matter, including whether Agent-Related Persons have disclosed material
information in their possession. Each Lender represents to the Administrative Agent that it has,
independently and without reliance upon any Agent-Related Person or any other Lender and based on
such documents and information as it has deemed appropriate, made its own appraisal of and
investigation into the business, prospects, operations, property, financial and other condition and
creditworthiness of the Credit Parties and their respective Affiliates, and all applicable bank or
other regulatory laws relating to the transactions contemplated hereby, and made its own decision
to enter into this Credit Agreement and to extend credit to the Borrower hereunder. Each Lender
also represents that it will, independently and without reliance upon any Agent-Related Person or
any other Lender and based on such documents and information as it shall deem appropriate at the
time, continue to make its own credit analysis, appraisals and decisions in taking or not taking
action under this Credit Agreement and the other Credit Documents, and to make such investigations
as it deems necessary to inform itself as to the business, prospects, operations, property,
financial and other condition and creditworthiness of the Borrower. Except for notices, reports
and other documents expressly required to be furnished to the Lenders by the Administrative Agent
herein, the Administrative Agent shall not have any duty or responsibility to provide any Lender
with any credit or other information concerning the business, prospects, operations, property,
financial and other condition or creditworthiness of any of the Credit Parties or any of their
respective Affiliates which may come into the possession of any Agent-Related Person, it being
understood that the Administrative Agent shall forward to the Lenders information it receives
pursuant to Section 7.1.



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     10.7 Indemnification.



     Whether or not the transactions contemplated hereby are consummated, the Lenders shall
indemnify upon demand each Agent-Related Person (to the extent not reimbursed by or on behalf of
any Credit Party and without limiting the obligation of any Credit Party to do so), pro rata, and
hold harmless each Agent-Related Person from and against any and all Indemnified Liabilities
incurred by it; provided, however, that no Lender shall be liable for the payment
to any Agent-Related Person of any portion of such Indemnified Liabilities resulting from such
Agent-Related Person’s gross negligence or willful misconduct; it being understood that no action
taken in accordance with the directions of the Required Lenders (or all Lenders, if applicable)
shall be deemed to constitute gross negligence or willful misconduct for purposes of this Section
10.7. Without limitation of the foregoing, each Lender shall reimburse the Administrative Agent
upon demand for its ratable share of any costs or out-of-pocket expenses (including Attorney Costs)
incurred by the Administrative Agent in connection with the preparation, execution, delivery,
administration, modification, amendment or enforcement (whether through negotiations, legal
proceedings or otherwise) of, or legal advice in respect of rights or responsibilities under, this
Credit Agreement, any other Credit Document, or any document contemplated by or referred to herein,
to the extent that the Administrative Agent is not reimbursed for such expenses by or on behalf of
the Credit Parties. The undertaking in this Section 10.7 shall survive termination of the
Commitments, the payment of all Obligations hereunder and the resignation or replacement of the
Administrative Agent.



     10.8 Administrative Agent in Its Individual Capacity.



     Bank of America and its Affiliates may make loans to, issue letters of credit for the account
of, accept deposits from, acquire equity interests in and generally engage in any kind of banking,
trust, financial advisory, underwriting or other business with each of the Credit Parties and their
respective Affiliates as though Bank of America were not the Administrative Agent or the Issuing
Lender hereunder and without notice to or consent of the Lenders. The Lenders acknowledge that,
pursuant to such activities, Bank of America or its Affiliates may receive information regarding
any Credit Party or its Affiliates (including information that may be subject to confidentiality
obligations in favor of such Credit Party or such Affiliate) and that the Administrative Agent
shall be under no obligation to provide such information to them. With respect to its Loans, Bank
of America shall have the same rights and powers under this Credit Agreement as any other Lender
and may exercise such rights and powers as though it were not the Administrative Agent or the
Issuing Lender, and the terms “Lender” and “Lenders” include Bank of America in its individual
capacity.



     10.9 Successor Agent.



     The Administrative Agent may resign as Administrative Agent upon 30 days’ notice to the
Lenders; provided that any such resignation by Bank of America shall also constitute its



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resignation as Issuing Lender (other than with respect to Letters of Credit outstanding at such
time until such Letters of Credit expire or are substituted as set forth below). If the
Administrative Agent resigns under this Credit Agreement, the Required Lenders shall appoint from
among the Lenders a successor administrative agent for the Lenders which successor administrative
agent (such appointment, absent the existence of an Event of Default, to be subject to the consent
of the Borrower, which consent of the Borrower shall not be unreasonably withheld or delayed). If
no successor administrative agent is appointed prior to the effective date of the resignation of
the Administrative Agent, the Administrative Agent may appoint, after consulting with the Lenders
and the Borrower, a successor administrative agent from among the Lenders. Upon the acceptance of
its appointment as successor administrative agent hereunder, the Person acting as such successor
administrative agent shall succeed to all the rights, powers and duties of the retiring
Administrative Agent, Issuing Lender and the respective terms “Administrative Agent,” and “Issuing
Lender” shall mean such successor administrative agent, Letter of Credit issuer, and the retiring
Administrative Agent’s appointment, powers and duties as Administrative Agent shall be terminated
and the retiring Issuing Lender’s rights, powers and duties as such shall be terminated (other than
as set forth above), without any other or further act or deed on the part of such retiring Issuing
Lender or any other Lender, other than the obligation of the successor Issuing Lender to issue
letters of credit in substitution for the Letters of Credit, if any, outstanding at the time of
such succession or to make other arrangements satisfactory to the retiring Issuing Lender to
effectively assume the obligations of the retiring Issuing Lender with respect to such Letters of
Credit. After any retiring Administrative Agent’s resignation hereunder as Administrative Agent,
the provisions of this Section 10 and Sections 11.5 and 11.10 shall continue to inure to its
benefit as to any actions taken or omitted to be taken by it while it was Administrative Agent
under this Credit Agreement. If no successor administrative agent has accepted appointment as
Administrative Agent by the date which is 30 days following a retiring Administrative Agent’s
notice of resignation, the retiring Administrative Agent’s resignation shall nevertheless thereupon
become effective and the Lenders shall perform all of the duties of the Administrative Agent
hereunder until such time, if any, as the Required Lenders appoint a successor agent as provided
for above.




     10.10 Administrative Agent May File Proof of Claims.



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




     (a) to file and prove a claim for the whole amount of the principal and interest owing
and unpaid in respect of the Loans, LOC Obligations and all other Credit Party Obligations
that are owing and unpaid and to file such other documents as may be necessary or advisable
in order to have the claims of the Lenders and the Administrative



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Agent (including any claim
for the reasonable compensation, expenses, disbursements and advances of the Lenders and the
Administrative Agent and their respective agents and counsel and all other amounts due the
Lenders and the Administrative Agent under Sections 3.4 and 11.5) allowed in such judicial
proceeding; and




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


and any custodian, receiver, assignee, trustee, liquidator, sequestrator or other similar official
in any such judicial proceeding is hereby authorized by each Lender to make such payments to the
Administrative Agent or the Issuing Lender, as applicable, and, in the event that the
Administrative Agent or Issuing Lender shall consent to the making of such payments directly to the
Lenders, to pay to the Administrative Agent or Issuing Lender any amount due for the reasonable
compensation, expenses, disbursements and advances of the Administrative Agent or Issuing Lender
and its respective agents and counsel, and any other amounts due the Administrative Agent or
Issuing Lender under Sections 3.4 and 11.5.




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



SECTION 11




MISCELLANEOUS



     11.1 Notices and other Communications; Facsimile Copies.



     (a) General. Unless otherwise expressly provided herein, all notices and other
communications provided for hereunder shall be in writing (including by facsimile transmission).
All written notices and all other communications expressly permitted hereunder to be given by
telephone shall be made to the applicable address, facsimile number, electronic mail address or
telephone number specified for such Person on Schedule 11.1 or to such other address,
facsimile number, electronic mail address or telephone number as shall be designated by such party
in a notice to the other parties. All such notices and other communications shall be deemed to be
given or made upon the earlier to occur of (i) actual receipt by the relevant party hereto and (ii)
(A) if delivered by hand or by courier, when signed for by or on behalf of the relevant party
hereto; (B) if delivered by mail, four Business Days after deposit in the mails, postage prepaid;
(C) if delivered by facsimile, when sent and receipt has been confirmed by telephone; and (D) if
delivered by electronic mail (which form of delivery is subject to the provisions of subsection (c)
below), when delivered; provided, however, that notices and other communications to
the



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Administrative Agent or the Lenders pursuant to Section 2 shall not be effective until
actually received by the Administrative Agent or the Lenders, as the case may be. In no event
shall a voicemail message be effective as a notice, communication or confirmation hereunder.




     (b) Effectiveness of Facsimile Documents and Signatures. Credit Documents may be
transmitted and/or signed by facsimile. The effectiveness of any such documents and signatures
shall, subject to applicable law, have the same force and effect as manually-signed originals and
shall be binding on the Borrower, the Administrative Agent and the Lenders. The Administrative
Agent may also require that any such documents and signatures be confirmed by a manually-signed
original thereof; provided, however, that the failure to request or deliver the
same shall not limit the effectiveness of any facsimile document or signature.



     (c) Electronic Communications. Notices and other communications to the Lenders
hereunder may be delivered or furnished by electronic communication (including e-mail and Internet
or intranet websites) pursuant to procedures approved by the Administrative Agent, provided
that the foregoing shall not apply to notices to any Lender pursuant to Section 2 if such Lender
has notified the Administrative Agent that it is incapable of receiving notices under such Section
by electronic communication. The Administrative Agent or the Borrower may, in its discretion,
agree to accept notices and other communications to it hereunder by electronic communications
pursuant to procedures approved by it, provided that approval of such procedures may be
limited to particular notices or communications.



     (d) Reliance by the Administrative Agent, Issuing Lender and Lenders. The
Administrative Agent, the Issuing Lender and the Lenders shall be entitled to rely and act upon any
notices purportedly given by or on behalf of the Borrower even if (i) such notices were not made in
a manner specified herein, were incomplete or were not preceded or followed by any other form of
notice specified herein, or (ii) the terms thereof, as understood by the recipient, varied from any
confirmation thereof. The Borrower shall indemnify each Agent-Related Person, the Issuing Lender
and each Lender from all losses, costs, expenses and liabilities resulting from the reliance by
such Person on each notice purportedly given by or on behalf of the Borrower. All telephonic
notices to and other communications with the Administrative Agent or the Issuing Lender may be
recorded by the Administrative Agent or the Issuing Lender, as applicable, and each of the parties
hereto hereby consents to such recording.



11.2 Right of Set-Off, Automatic Debits.





     (a) In addition to any rights now or hereafter granted under applicable law or
otherwise, and not by way of limitation of any such rights, upon the occurrence of an Event
of Default and the commencement of remedies described in Section 9.2, each Lender is
authorized at any time and from time to time, without presentment, demand, protest or other
notice of any kind (all of which rights being hereby expressly waived), to set-off and to
appropriate and apply any and all deposits (general or special) and any other indebtedness
at any time held or owing by such Lender (including, without limitation, branches, agencies
or



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Affiliates of such Lender wherever located) to or for the credit or the account of any
Credit Party against obligations and liabilities of such Credit Party to the Lenders
hereunder, under the Notes, the other Credit Documents or otherwise, irrespective of whether
the Administrative Agent or the Lenders shall have made any demand hereunder and although
such obligations, liabilities or claims, or any of them, may be contingent or unmatured, and
any such set-off shall be deemed to have been made immediately upon the occurrence of an
Event of Default even though such charge is made or entered on the books of such Lender
subsequent thereto. The Credit Parties hereby agree that any Participation Purchaser may
exercise all rights of set-off with respect to its participation interest as fully as if
such Person were a Lender hereunder.




     (b) In addition to clause (a) above, with respect to any principal or interest payment,
fee, or any other cost or expense (including Attorney Costs), due and payable to the
Administrative Agent, the Issuing Lender or the Lenders under the Credit Documents, the
Credit Parties hereby irrevocably authorize and direct the Administrative Agent to debit any
deposit account of the Credit Parties with the Administrative Agent (as one of the Lenders)
in an amount such that the aggregate amount debited from all such deposit accounts does not
exceed such payment, fee, or other cost or expense. If there are insufficient funds in such
deposit accounts to cover the amount of the payment, fee, other cost or expense then due,
such debits will be reversed (in whole or in part, in the Administrative Agent’s sole
discretion) and such amount not debited shall be deemed to be unpaid. No such debit under
this Section 11.2(b) shall be deemed a set-off.



     11.3 Benefit of Agreement.




     (a) The provisions of this Credit Agreement shall be binding upon and inure to the
benefit of the parties hereto and their respective successors and assigns permitted hereby,
except that the Borrower may not assign or otherwise transfer any of its rights or
obligations hereunder without the prior written consent of each Lender and no Lender may
assign or otherwise transfer any of its rights or obligations hereunder except (i) to an
Eligible Assignee in accordance with the provisions of subsection (b) of this
Section, (ii) by way of participation in accordance with the provisions of subsection (d) of
this Section, or (iii) by way of pledge or assignment of a security interest subject to the
restrictions of subsection (f) of this Section (and any other attempted assignment or
transfer by any party hereto shall be null and void). Nothing in this Credit Agreement,
expressed or implied, shall be construed to confer upon any Person (other than BAS, the
parties hereto, their respective successors and assigns permitted hereby and Participation
Purchasers to the extent provided in subsection (d) of this Section) any legal or equitable
right, remedy or claim under or by reason of this Credit Agreement.




     (b) Any Lender may at any time assign to one or more Eligible Assignees all or a
portion of its rights and obligations under this Credit Agreement (including all or a
portion of its Commitment and the Loans at the time owing to it); provided that (i)
except



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in the case of an assignment of the entire remaining amount of the assigning Lender’s
Commitment and the Loans at the time owing to it or in the case of an assignment to a Lender
or an Affiliate of a Lender or an Approved Fund with respect to a Lender, the aggregate
amount of the Commitment (which for this purpose includes Loans outstanding thereunder)
subject to each such assignment, determined as of the date the Assignment and Assumption
with respect to such assignment is delivered to the Administrative Agent or, if “Trade Date”
is specified in the Assignment and Assumption, as of the Trade Date, shall not be less than
$5,000,000 unless each of the Administrative Agent and, so long as no Event of Default has
occurred and is continuing, the Borrower otherwise consents (each such consent not to be
unreasonably withheld or delayed); (ii) each partial assignment shall be made as an
assignment of a proportionate part of all the assigning Lender’s rights and obligations
under this Credit Agreement with respect to the Loans or the Commitment assigned; (iii) any
assignment of a Commitment must be approved by the Administrative Agent (which approval
shall not be unreasonably withheld) unless the Person that is the proposed assignee is
itself a Lender (whether or not the proposed assignee would otherwise qualify as an Eligible
Assignee); and (iv) the parties to each assignment shall execute and deliver to the
Administrative Agent an Assignment and Assumption, together with a processing and
recordation fee of $3,500. Subject to acceptance and recording thereof by the
Administrative Agent pursuant to subsection (c) of this Section, from and after the
effective date specified in each Assignment and Assumption, the Eligible Assignee thereunder
shall be a party to this Credit Agreement and, to the extent of the interest assigned by
such Assignment and Assumption, have the rights and obligations of a Lender under this
Credit Agreement, and the assigning Lender thereunder shall, to the extent of the interest
assigned by such Assignment and Assumption, be released from its obligations under this
Credit Agreement (and, in the case of an Assignment and Assumption covering all of the
assigning Lender’s rights and obligations under this Credit Agreement, such Lender shall
cease to be a party hereto but shall continue to be entitled to the benefits of Sections 3.9
through 3.15 and 11.5 with respect to facts and circumstances occurring prior to the
effective date of such assignment). Upon request, the Borrower (at its expense) shall
execute and deliver a Note to the assignee Lender. Any assignment or transfer by a Lender
of rights or obligations under this Credit Agreement that does not comply with this
subsection shall be treated for purposes of this Credit Agreement as a sale by such Lender
of a participation in such rights and obligations in accordance with subsection (d) of this
Section.




     (c) The Administrative Agent, acting solely for this purpose as an agent of the
Borrower, shall maintain at one of its offices in the United States a copy of each
Assignment and Assumption delivered to it and a register for the recordation of the names
and addresses of the Lenders, and the Commitments of, and principal amounts of the Loans
owing to, each Lender pursuant to the terms hereof from time to time (the
“Register”). The entries in the Register shall be conclusive, and the Borrower, the
Administrative Agent and the Lenders may treat each Person whose name is recorded in



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the
Register pursuant to the terms hereof as a Lender hereunder for all purposes of this Credit
Agreement, notwithstanding notice to the contrary. The Register shall be available for
inspection by the Borrower and any Lender, at any reasonable time and from time to time upon
reasonable prior notice.




     (d) Any Lender may at any time, without the consent of, or notice to, the Borrower or
the Administrative Agent, sell participations to any Person (other than a natural person or
the Borrower or any of the Borrower’s Affiliates or Subsidiaries) (each, a
“Participation Purchaser”) in all or a portion of such
Lender’s rights and/or obligations under this Credit Agreement (including all or a portion
of its Commitment and/or the Loans owing to it); provided that (i) such Lender’s
obligations under this Credit Agreement shall remain unchanged, (ii) such Lender shall
remain solely responsible to the other parties hereto for the performance of such
obligations and (iii) the Borrower, the Administrative Agent and the other Lenders shall
continue to deal solely and directly with such Lender in connection with such Lender’s
rights and obligations under this Credit Agreement. Any agreement or instrument pursuant to
which a Lender sells such a participation shall provide that such Lender shall retain the
sole right to enforce this Credit Agreement and to approve any amendment, modification or
waiver of any provision of this Credit Agreement; provided that such agreement or
instrument may provide that such Lender will not, without the consent of the Participation
Purchaser, agree to any amendment, waiver or other modification described in clauses (a)
through (g) of Section 11.6 that directly affects such Participation Purchaser. Subject to
subsection (e) of this Section, the Borrower agrees that each Participation Purchaser shall
be entitled to the benefits of Sections 3.9 through 3.15 and 11.5 to the same extent as if
it were a Lender and had acquired its interest by assignment pursuant to subsection (b) of
this Section. To the extent permitted by law, each Participation Purchaser also shall be
entitled to the benefits of Section 11.2 as though it were a Lender, provided such
Participation Purchaser agrees to be subject to Section 3.8 as though it were a Lender.




     (e) A Participation Purchaser shall not be entitled to receive any greater payment
under Section 3.9 or 3.13 than the applicable Lender would have been entitled to receive
with respect to the participation sold to such Participation Purchaser, unless the sale of
the participation to such Participation Purchaser is made with the Borrower’s prior written
consent. A Participation Purchaser that would be a “foreign corporation, partnership or
trust” within the meaning of the Code if it were a Lender shall not be entitled to the
benefits of Section 3.13 unless the Borrower is notified of the participation sold to such
Participation Purchaser and such Participation Purchaser agrees, for the benefit of the
Borrower, to comply with Section 3.13(d) as though it were a Lender.




     (f) Any Lender may at any time pledge or assign a security interest in all or any
portion of its rights under this Credit Agreement (including under its Note, if any) to
secure obligations of such Lender, including any pledge or assignment to secure obligations
to a Federal Reserve Bank; provided that no such pledge or assignment shall



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release such Lender from any of its obligations hereunder or substitute any such pledgee or assignee
for such Lender as a party hereto.




     (g) Notwithstanding anything to the contrary contained herein, any Lender (a
“Granting Lender”) may grant to a special purpose funding vehicle managed or
sponsored by the Granting Lender or an Affiliate thereof (an “SPC”) the option to
fund all or any part of any Loan that such Granting Lender would otherwise be obligated to
fund pursuant to this Credit Agreement; provided that (i) nothing herein shall
constitute a commitment by any SPC to fund any Loan, (ii) if an SPC elects not to exercise
such option or otherwise fails to fund all or any part of such Loan, the Granting Lender
shall be obligated to fund such Loan pursuant to the terms hereof, (iii) no SPC shall have
any voting rights pursuant to Section 11.6, (iv) with respect to notices, payments and other
matters hereunder, the Borrower, the Administrative Agent and the Lenders shall not be
obligated to deal with an SPC, but may limit their communications and other dealings
relevant to such SPC to the applicable Granting Lender and (v) each Granting Lender’s
obligations under this Credit Agreement shall remain unchanged. Each party hereto agrees
that no SPC will be entitled to any rights or benefits except as expressly set forth in this
subsection (g). The funding of a Loan by an SPC hereunder shall utilize the Commitment of
the Granting Lender to the same extent that, and as if, such Loan were funded by such
Granting Lender. Each party hereto hereby agrees that no SPC shall be liable for any
indemnity or payment under this Credit Agreement for which a Lender would otherwise be
liable for so long as, and to the extent, the Granting Lender provides such indemnity or
makes such payment. Notwithstanding anything to the contrary contained in this Credit
Agreement, any SPC may disclose on a confidential basis any non-public information relating
to its funding of Loans to any rating agency, commercial paper dealer or provider of any
surety or guarantee to such SPC. This subsection (g) may not be amended without the prior
written consent of each Granting Lender, all or any part of whose Loan is being funded by an
SPC at the time of such amendment.




     (h) Notwithstanding anything to the contrary contained herein, any Lender that is a
Fund may create a security interest in all or any portion of the Loans owing to it and the
Note, if any, held by it to the trustee for holders of obligations owed, or securities
issued, by such Fund as security for such obligations or securities, provided that unless
and until such trustee actually becomes a Lender in compliance with the other provisions of
this Section 11.3, (i) no such pledge shall release the pledging Lender from any of its
obligations under the Credit Documents and (ii) such trustee shall not be entitled to
exercise any of the rights of a Lender under the Credit Documents even though such trustee
may have acquired ownership rights with respect to the pledged interest through foreclosure
or otherwise.




     (i) Notwithstanding anything to the contrary contained herein, if at any time Bank of
America assigns all of its Commitment and Loans pursuant to subsection (b) above, Bank of
America may, upon 30 days’ notice to the Borrower and the Lenders,



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resign as Issuing Lender.
In the event of any such resignation as Issuing Lender, the Borrower shall be entitled to
appoint from among the Lenders a successor Issuing Lender hereunder; provided,
however, that no failure by the Borrower to appoint any such successor shall affect
the resignation of Bank of America as Issuing Lender. If Bank of America resigns as Issuing
Lender, it shall retain all the rights and obligations of the Issuing Lender hereunder with
respect to all Letters of Credit outstanding as of the effective date of its resignation as
Issuing Lender and all LOC Obligations with respect thereto (including the right to require
the Lenders to make Base Rate Loans or fund risk participations pursuant to Section 2.2(c)).



     11.4 No Waiver; Remedies Cumulative.



     No failure or delay on the part of the Administrative Agent or any Lender in exercising any
right, power or privilege hereunder or under any other Credit Document and no course of dealing
between the Borrower or any Credit Party and the Administrative Agent or any Lender shall operate
as a waiver thereof; nor shall any single or partial exercise of any right, power or privilege
hereunder or under any other Credit Document preclude any other or further exercise thereof or the
exercise of any other right, power or privilege hereunder or thereunder. The rights and remedies
provided herein are cumulative and not exclusive of any rights or remedies which the Administrative
Agent or any Lender would otherwise have. No notice to or demand on any Credit Party in any case
shall entitle any Credit Party to any other or further notice or demand in similar or other
circumstances or constitute a waiver of the rights of the Administrative Agent or the Lenders to
any other or further action in any circumstances without notice or demand.



     11.5 Payment of Expenses; Indemnification.



     The Credit Parties agree to: (a) pay all reasonable out-of-pocket costs and expenses of (i)
the Agent-Related Persons in connection with (A) the negotiation, preparation, execution and
delivery and syndication of this Credit Agreement and the other Credit Documents and the documents
and instruments referred to therein (including, without limitation, the reasonable fees and
expenses of Moore & Van Allen, special counsel to the Administrative Agent) and (B) any amendment,
waiver or consent relating hereto and thereto including, but not limited to, any such amendments,
waivers or consents resulting from or related to any work-out, renegotiation or restructure
relating to the performance by the Credit Parties under this Credit Agreement, and (ii) the
Agent-Related Persons and the Lenders in connection with (A) enforcement of the Credit Documents
and the documents and instruments referred to therein, including, without limitation, in connection
with any such enforcement, the reasonable Attorneys’ Costs of the Administrative Agent and each of
the Lenders and (B) any bankruptcy or insolvency proceeding of any Credit Party or any of its
Subsidiaries and (b) indemnify the Agent-Related Persons and each Lender, its officers, directors,
employees, representatives, counsel and agents from and hold each of them harmless against any and
all losses, liabilities, claims, damages or expenses incurred by any of them as a result of, or
arising out of, or in any way related to, or by reason of, any investigation, litigation or other
proceeding (whether or not such Agent-Related Person or any Lender is a party thereto)



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related to
the entering into and/or performance of any Credit Document or the use of proceeds of any Loans
(including other extensions of credit) hereunder or the consummation of any other transactions
contemplated in any Credit Document, including, without limitation, reasonable Attorneys’ Costs
incurred in connection with any such investigation, litigation or other proceeding (but excluding
any such losses, liabilities, claims, damages or expenses to the extent incurred by
reason of gross negligence or willful misconduct on the part of the Person to be indemnified or
from the material breach by the Person to be indemnified of its obligations under the Credit
Documents) (all of the foregoing, collectively, “Indemnified Liabilities”). The agreements
in this Section 11.5 shall survive the termination of the Commitments and the repayment of the
Credit Party Obligations.




     11.6 Amendments, Waivers and Consents.



     Neither this Credit Agreement nor any other Credit Document nor any of the terms hereof or
thereof may be amended, changed, waived, discharged or terminated unless such amendment, change,
waiver, discharge or termination is in writing and signed by the Required Lenders and the then
Credit Parties; provided that no such amendment, change, waiver, discharge or termination
shall without the consent of all the Lenders:




     (a) extend the Maturity Date, or postpone or extend the time for any payment or
prepayment of principal;




     (b) (i) reduce the rate of interest or the amount of fees or (ii) extend the time of
payment of interest (other than as a result of waiving the applicability of any post-default
increase in interest rates) thereon or fees hereunder;




     (c) reduce or waive the principal amount of any Loan;




     (d) increase or extend the Commitment of a Lender (it being understood and agreed that
a waiver of any Default or Event of Default or a waiver of any mandatory reduction in the
Commitments shall not constitute a change in the terms of any Commitment of any Lender);




     (e) release the Borrower from its obligations or consent to the assignment or transfer
by the Borrower of any of its rights and obligations under (or in respect of) the Credit
Documents or release all or substantially all of the Guarantors from their respective
obligations under the Credit Documents;




     (f) amend, modify or waive any provision of this Section 11.6 or Section 3.4(a),
3.4(b), 3.4(c)(i), 3.7, 3.8, 9.1(a), 9.3, 11.2, 11.3 or 11.5;




     (g) reduce any percentage specified in, or otherwise modify, the definition of Required
Lenders.



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Notwithstanding the above, (i) no provisions of Section 10 may be amended or modified without the
consent of the Administrative Agent and (ii) no provisions of Section 2.2 may be amended or
modified without the consent of the Issuing Lender.



Notwithstanding the fact that the consent of all the Lenders is required in certain circumstances
as set forth above, (x) each Lender is entitled to vote as such Lender sees fit on any
reorganization plan that affects the Loans or the Letters of Credit, and each Lender acknowledges
that the provisions of Section 1126(c) of the Bankruptcy Code supersedes the unanimous consent
provisions set forth herein and (y) the Required Lenders may consent to allow a Credit Party to use
cash collateral in the context of a bankruptcy or insolvency proceeding.




     11.7 Counterparts.



     This Credit Agreement may be executed in any number of counterparts, each of which where so
executed and delivered shall be an original, but all of which shall constitute one and the same
instrument.



     11.8 Headings.



     The headings of the sections and subsections hereof are provided for convenience only and
shall not in any way affect the meaning or construction of any provision of this Credit Agreement.



     11.9 Defaulting Lender.



     Each Lender understands and agrees that if such Lender is a Defaulting Lender then
notwithstanding the provisions of Section 11.6 it shall not be entitled to vote on any matter
requiring the consent of the Required Lenders or to object to any matter requiring the consent of
all the Lenders; provided, however, that all other benefits and obligations under
the Credit Documents shall apply to such Defaulting Lender.



     11.10 Survival of Indemnification and Representations and Warranties.



     All indemnities set forth herein and all representations and warranties made hereunder and in
any other Credit Document or other document delivered pursuant hereto or thereto or in connection
herewith or therewith shall survive the execution and delivery hereof and thereof. Such
representations and warranties have been or will be relied upon by the Administrative Agent, the
Issuing Lender and each Lender, regardless of any investigation made by the Administrative Agent,
the Issuing Lender or any Lender or on their behalf and notwithstanding that the Administrative
Agent, the Issuing Lender or any Lender may have had notice or knowledge of any Default or Event of
Default at the time of any Extension of Credit, and shall continue in full force and effect as long
as any Loan or any other Credit Party Obligation hereunder shall remain unpaid or unsatisfied or
any Letter of Credit shall remain outstanding.



101









 





     11.11 Governing Law; Jurisdiction.



     THIS CREDIT AGREEMENT AND THE OTHER CREDIT DOCUMENTS AND THE RIGHTS AND OBLIGATIONS OF THE
PARTIES HEREUNDER AND THEREUNDER SHALL BE GOVERNED BY AND CONSTRUED AND INTERPRETED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF NEW YORK. Each Credit Party irrevocably consents to the service of
process in any action or proceeding with respect to this Credit Agreement or any other Credit
Document by the mailing of copies thereof by registered or certified mail, postage prepaid, to it
at the address for notices pursuant to Section 11.1, such service to become effective 10 days after
such mailing. Nothing herein shall affect the right of a Lender to serve process in any other
manner permitted by law.



     11.12 Waiver of Jury Trial; Waiver of Consequential Damages.



     EACH PARTY TO THIS CREDIT AGREEMENT HEREBY EXPRESSLY WAIVES ANY RIGHT TO TRIAL BY JURY OF ANY
CLAIM, DEMAND, ACTION OR CAUSE OF ACTION ARISING UNDER ANY CREDIT DOCUMENT OR IN ANY WAY CONNECTED
WITH OR RELATED OR INCIDENTAL TO THE DEALINGS OF THE PARTIES HERETO OR ANY OF THEM WITH RESPECT TO
ANY CREDIT DOCUMENT, OR THE TRANSACTIONS RELATED THERETO, IN EACH CASE WHETHER NOW EXISTING OR
HEREAFTER ARISING, AND WHETHER FOUNDED IN CONTRACT OR TORT OR OTHERWISE; AND EACH PARTY HEREBY
AGREES AND CONSENTS THAT ANY SUCH CLAIM, DEMAND, ACTION OR CAUSE OF ACTION SHALL BE DECIDED BY
COURT TRIAL WITHOUT A JURY, AND THAT ANY PARTY TO THIS CREDIT AGREEMENT MAY FILE AN ORIGINAL
COUNTERPART OR A COPY OF THIS SECTION WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE
SIGNATORIES HERETO TO THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY. Each Credit Party agrees not to
assert any claim against the Administrative Agent, the Issuing Lenders, any Lender, any of their
Affiliates, or any of their respective directors, officers, employees, attorneys or agents, on any
theory of liability, for special, indirect, consequential or punitive damages arising out of or
otherwise relating to any of the transactions contemplated herein.



     11.13 Severability.



     If any provision of any of the Credit Documents is determined to be illegal, invalid or
unenforceable, such provision shall be fully severable and the remaining provisions shall remain in
full force and effect and shall be construed without giving effect to the illegal, invalid or
unenforceable provisions.



102









 





     11.14 Further Assurances.



     The Credit Parties agree, upon the request of the Administrative Agent, to promptly take such
actions, as reasonably requested, as is necessary to carry out the intent of this Credit Agreement
and the other Credit Documents.



     11.15 Confidentiality.



     Each Lender agrees that it will use its reasonable best efforts to keep confidential and to
cause any representative designated under Section 7.11 to keep confidential any Information (as
defined below) from time to time supplied to it under any Credit Document; provided,
however, that nothing herein shall prevent the disclosure of any such Information to (a)
the extent a Lender in good faith believes such disclosure is required by Requirement of Law or by
any subpoena or similar legal process, (b) the extent requested by any regulatory authority
purporting to have jurisdiction over it (including any self-regulatory authority, such as the
National Association of Insurance Commissioners), (c) counsel for a Lender or to its accountants,
(d) bank examiners or auditors or comparable Persons, (e) any Affiliate of a Lender and its
respective partners, directors, officers, employees, agents, advisors and representatives (it being
understood that such Persons to whom such disclosure is made will be informed of the confidential
nature of such Information and instructed to keep such Information confidential), (f) any other
Lender, or any assignee, transferee or Participant Purchaser, or any potential assignee, transferee
or Participant Purchaser, of all or any portion of any Lender’s rights under this Credit Agreement
who is notified of the confidential nature of the information, (g) to any Person with the consent
of the Borrower, (h) any Person in connection with the exercise of any remedies hereunder or under
any other Credit Document or any action or proceeding relating to this Credit Agreement or any
other Credit Document or the enforcement of rights hereunder or thereunder or (i) any other Person
in connection with any litigation to which any one or more of the Lenders is a party. No Lender
shall have any obligation under this Section 11.15 to the extent any such information becomes
available on a non-confidential basis from a source other than a Credit Party or that any
information becomes publicly available other than by a breach of this Section 11.15 by any Lender
or representative thereof.


For purposes of this Section, “Information” means all information received from any Credit
Party relating to any Credit Party or any of their respective businesses, other than any such
information that is available to the Administrative Agent, any Lender or the Issuing Lender on a
non-confidential basis prior to disclosure by such Credit Party, provided that, in the case
of information received from any Credit Party after the date hereof, such information is clearly
identified at the time of delivery as confidential. Any Person required to maintain the
confidentiality of Information as provided in this Section shall be considered to have complied
with its obligation to do so if such Person has exercised the same degree of care to maintain the
confidentiality of such Information as such Person would accord to its own confidential
information.






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     11.16 Entirety.



     This Credit Agreement together with the other Credit Documents and the Fee Letter represent
the entire agreement of the parties hereto and thereto, and supersede all prior agreements and
understandings, oral or written, if any, including any commitment letters or correspondence
relating to the Credit Documents or the transactions contemplated herein and therein.



     11.17 Binding Effect; Continuing Agreement.




     (a) This Credit Agreement shall become effective at such time when all of the
conditions set forth in Section 5.1 have been satisfied or waived by the Lenders and it
shall have been executed by the Borrower, the Guarantors and the Administrative Agent, and
the Administrative Agent shall have received copies hereof (telefaxed or otherwise) which,
when taken together, bear the signatures of each Lender, and thereafter this Credit
Agreement shall be binding upon and inure to the benefit of the Borrower, the Guarantors,
the Administrative Agent and each Lender and their respective successors and assigns. Upon
this Credit Agreement becoming effective, the Existing Credit Agreements shall be deemed
terminated and the Credit Parties and the lenders party to the Existing Credit Agreements shall no longer
have any obligations thereunder (other than those obligations in the Existing Credit
Agreements that expressly survive the termination of the Existing Credit Agreements).




     (b) This Credit Agreement shall be a continuing agreement and shall remain in full
force and effect until all Loans, LOC Obligations, interest, fees and other Credit Party
Obligations have been paid in full and all Commitments and Letters of Credit have been
terminated. Upon termination, the Credit Parties shall have no further obligations (other
than the indemnification provisions that survive) under the Credit Documents;
provided that should any payment, in whole or in part, of the Credit Party
Obligations be rescinded or otherwise required to be restored or returned by the
Administrative Agent or any Lender, whether as a result of any proceedings in bankruptcy or
reorganization or otherwise, then the Credit Documents shall automatically be reinstated and
all amounts required to be restored or returned and all costs and expenses incurred by the
Administrative Agent or any Lender in connection therewith shall be deemed included as part
of the Credit Party Obligations.



     11.18 USA PATRIOT Act Notice.



     Each Lender and the Administrative Agent (for itself and not on behalf of any Lender) hereby
notifies each 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 such Borrower, which information includes the name and address
of such Borrower and other information that will allow such Lender or the Administrative Agent, as
applicable, to identify such Borrower in accordance with the Act.



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     11.19 Judgment Currency.



     If, for the purposes of obtaining judgment in any court, it is necessary to convert a sum due
hereunder or any other Credit Document in one currency into another currency, the rate of exchange
used shall be that at which in accordance with normal banking procedures the Administrative Agent
could purchase the first currency with such other currency on the Business Day preceding that on
which final judgment is given. The obligation of each Borrower in respect of any such sum due from
it to the Administrative Agent or the Lenders hereunder or under the other Credit Documents shall,
notwithstanding any judgment in a currency (the “Judgment Currency”) other than that in
which such sum is denominated in accordance with the applicable provisions of this Credit Agreement
(the “Agreement Currency”), be discharged only to the extent that on the Business Day
following receipt by the Administrative Agent of any sum adjudged to be so due in the Judgment
Currency, the Administrative Agent may in accordance with normal banking procedures purchase the
Agreement Currency with the Judgment Currency. If the amount of the Agreement Currency so
purchased is less than the sum originally due to the Administrative Agent from any Borrower in the
Agreement Currency, such Borrower agrees, as a separate obligation and notwithstanding any such
judgment, to indemnify the Administrative Agent or the Person to whom such obligation was owing
against such loss. If the amount of the Agreement Currency so purchased is greater than the sum
originally due to the Administrative Agent in such currency, the Administrative Agent agrees to
return the amount of any excess to such Borrower (or to any other Person who may be entitled
thereto under applicable law).


[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]





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     Each of the parties hereto has caused a counterpart of this Credit Agreement to be duly
executed and delivered as of the date first above written.


BORROWER:




	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 
	 	 	POLARIS INDUSTRIES INC.,

a Minnesota corporation	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:

Title:
	 	Michael W. Malone

Chief Financial Officer, Secretary and

Vice President-Finance	 	 






 









 






	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 
	GUARANTORS:	 	POLARIS REAL ESTATE CORPORATION OF

IOWA, INC., a Delaware corporation	 	 
	 
	 	 	 	 	 	 
	 	 	POLARIS REAL ESTATE CORPORATION,

a Delaware corporation	 	 
	 
	 	 	 	 	 	 
	 	 	POLARIS ACCEPTANCE INC.,

a Minnesota corporation	 	 
	 
	 	 	 	 	 	 
	 	 	POLARIS SALES INC., a Minnesota corporation	 	 
	 
	 	 	 	 	 	 
	 	 	POLARIS DIRECT INC., a Minnesota corporation	 	 
	 
	 	 	 	 	 	 
	 	 	POLARIS INDUSTRIES INC., a Delaware corporation	 	 
	 
	 	 	 	 	 	 
	 	 	POLARIS INDUSTRIES MANUFACTURING LLC,

a Minnesota limited liability company	 	 
	 
	 

	 	By:	 	 
	 	 
	 	 	Name:Michael W. Malone	 	 
	 	 	Title: Chief Financial Officer, Secretary and	 	 
	 	 	 	 	  Vice President-Finance of each of the foregoing
entities	 	 






 









 





	 	 	 	 	 	 	 
	ADMINISTRATIVE AGENT:	 	BANK OF AMERICA, N.A.,

as Administrative Agent	 	 
	 

	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	Title:	 	 	 	 
	 

	 	 	 	 	 	 





 









 






	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 
	LENDERS:	 	BANK OF AMERICA, N.A., individually in its capacity

as a Lender and in its capacity as Issuing Lender	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	Title: