Exhibit
10.1


 


$90,750,000


 


AMENDED AND RESTATED


 


CREDIT AGREEMENT


 


Dated as of August 1, 2005


 


among


 


CANTEL MEDICAL CORP.


 


as Borrower,


 


THE BANKS, FINANCIAL INSTITUTIONS AND

OTHER INSTITUTIONAL LENDERS NAMED HEREIN,


 


as Lenders,


 


BANK OF AMERICA, N.A.,


 


as Issuing Bank,

as Swing Line Bank

and

as Administrative Agent,


 


PNC Bank, National Association,


 


as Syndication Agent,


 


Wells Fargo Bank, National Association


 


as Documentation Agent,


 


and


 


BANC OF AMERICA SECURITIES LLC,


 


as Sole Lead Arranger and Sole Book Manager


 





















 


TABLE OF
CONTENTS


 


	
  ARTICLE I DEFINITIONS
  AND ACCOUNTING TERMS

  	
   

  
	
  Section 1.1

  	
  Certain
  Defined Terms.

  	
   

  
	
  Section 1.2

  	
  Computation of Time
  Periods.

  	
   

  
	
  Section 1.3

  	
  Accounting Terms.

  	
   

  
	
  Section 1.4

  	
  Construction.

  	
   

  
	
  Section 1.5

  	
  Letter of Credit Amounts.

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE II AMOUNTS AND TERMS OF THE
  ADVANCES AND THE LETTERS OF CREDIT

  	
   

  
	
  Section 2.1

  	
  The Advances.

  	
   

  
	
  Section 2.2

  	
  Making the Advances.

  	
   

  
	
  Section 2.3

  	
  Issuance
  of and Drawings and Reimbursement Under Letters of Credit.

  	
   

  
	
  Section 2.4

  	
  Repayment of Advances.

  	
   

  
	
  Section 2.5

  	
  Termination
  or Reduction of the Commitments.

  	
   

  
	
  Section 2.6

  	
  Prepayments.

  	
   

  
	
  Section 2.7

  	
  Interest.

  	
   

  
	
  Section 2.8

  	
  Fees.

  	
   

  
	
  Section 2.9

  	
  Conversion of Advances.

  	
   

  
	
  Section 2.10

  	
  Increased Costs, Etc.

  	
   

  
	
  Section 2.11

  	
  Payments and Computations.

  	
   

  
	
  Section 2.12

  	
  Taxes.

  	
   

  
	
  Section 2.13

  	
  Sharing of Payments, Etc.

  	
   

  
	
  Section 2.14

  	
  Use of Proceeds.

  	
   

  
	
  Section 2.15

  	
  Defaulting Lenders.

  	
   

  
	
  Section 2.16

  	
  Removal of Lender.

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE III CONDITIONS OF LENDING

  	
   

  
	
  Section 3.1

  	
  Conditions
  Precedent to Initial Extension of Credit.

  	
   

  
	
  Section 3.2

  	
  Conditions
  Precedent to Each Borrowing and Issuance.

  	
   

  
	
  Section 3.3

  	
  Determinations Under
  Section 3.1.

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE IV REPRESENTATIONS AND
  WARRANTIES OF THE BORROWER

  	
   

  
	
  Section 4.1

  	
  Organization.

  	
   

  
	
  Section 4.2

  	
  Subsidiaries.

  	
   

  
	
  Section 4.3

  	
  Corporate Power,
  Authorization.

  	
   

  
	
  Section 4.4

  	
  Governmental
  Authorizations, Approvals.

  	
   

  
	
  Section 4.5

  	
  Due Execution,
  Validity, Enforceability.

  	
   

  
	
  Section 4.6

  	
  Financial
  Statements; Material Adverse Change.

  	
   

  
	
  Section 4.7

  	
  Pro Forma
  Historical Financial Statements.

  	
   

  
	
  Section 4.8

  	
  Accurate Information.

  	
   

  
	
  Section 4.9

  	
  Litigation.

  	
   

  
	
  Section 4.10

  	
  Regulation U.

  	
   

  
	
  Section 4.11

  	
  ERISA.

  	
   

  
	
  Section 4.12

  	
  Casualty.

  	
   

  



 


i





















 


	
  Section 4.13

  	
  Environmental Matters.

  	
   

  
	
  Section 4.14

  	
  Burdensome Documents.

  	
   

  
	
  Section 4.15

  	
  Priority of Liens.

  	
   

  
	
  Section 4.16

  	
  Taxes.

  	
   

  
	
  Section 4.17

  	
  Compliance with
  Securities Laws.

  	
   

  
	
  Section 4.18

  	
  Solvency.

  	
   

  
	
  Section 4.19

  	
  Debt.

  	
   

  
	
  Section 4.20

  	
  No Defaults,
  Compliance with Laws.

  	
   

  
	
  Section 4.21

  	
  Owned Real Property.

  	
   

  
	
  Section 4.22

  	
  Leased Real Property.

  	
   

  
	
  Section 4.23

  	
  Material Contracts.

  	
   

  
	
  Section 4.24

  	
  Investments.

  	
   

  
	
  Section 4.25

  	
  Intellectual Property.

  	
   

  
	
  Section 4.26

  	
  Crosstex Acquisition
  Documents.

  	
   

  
	
  Section 4.27

  	
  Fees.

  	
   

  
	
  Section 4.28

  	
  Repatriation
  of Earnings of Foreign Subsidiaries.

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE V AFFIRMATIVE COVENANTS

  	
   

  
	
  Section 5.1

  	
  Compliance with Law.

  	
   

  
	
  Section 5.2

  	
  Payment of Taxes, Etc.

  	
   

  
	
  Section 5.3

  	
  Compliance with
  Environmental Laws.

  	
   

  
	
  Section 5.4

  	
  Preparation of
  Environmental Reports.

  	
   

  
	
  Section 5.5

  	
  Maintenance of Insurance.

  	
   

  
	
  Section 5.6

  	
  Preservation of
  Existence, Etc.

  	
   

  
	
  Section 5.7

  	
  Visitation Rights.

  	
   

  
	
  Section 5.8

  	
  Keeping of Books.

  	
   

  
	
  Section 5.9

  	
  Maintenance of
  Properties, Etc.

  	
   

  
	
  Section 5.10

  	
  Compliance with
  Terms of Leaseholds.

  	
   

  
	
  Section 5.11

  	
  Performance of
  Material Contracts.

  	
   

  
	
  Section 5.12

  	
  Transactions with
  Affiliates.

  	
   

  
	
  Section 5.13

  	
  Additional
  Guarantors; Agreement to Grant Additional Security.

  	
   

  
	
  Section 5.14

  	
  Performance
  of Crosstex Acquisition Documents.

  	
   

  
	
  Section 5.15

  	
  Cash Concentration Accounts.

  	
   

  
	
  Section 5.16

  	
  Post-Closing Matters.

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE VI NEGATIVE COVENANTS

  	
   

  
	
  Section 6.1

  	
  Liens, Etc.

  	
   

  
	
  Section 6.2

  	
  Debt.

  	
   

  
	
  Section 6.3

  	
  Accounts Payable.

  	
   

  
	
  Section 6.4

  	
  Fundamental Changes.

  	
   

  
	
  Section 6.5

  	
  Sales, Etc. of Assets.

  	
   

  
	
  Section 6.6

  	
  Investments in Other
  Persons.

  	
   

  
	
  Section 6.7

  	
  Dividends, Etc.

  	
   

  
	
  Section 6.8

  	
  Change in Nature of
  Business.

  	
   

  
	
  Section 6.9

  	
  Charter Amendments.

  	
   

  
	
  Section 6.10

  	
  Accounting Changes.

  	
   

  
	
  Section 6.11

  	
  Prepayments, Etc. of Debt.

  	
   

  



 


ii





















 


	
  Section 6.12

  	
  Amendment, Etc. of
  Crosstex Acquisition Documents.

  	
   

  
	
  Section 6.13

  	
  Amendment, Etc.
  of Material Contracts.

  	
   

  
	
  Section 6.14

  	
  Negative Pledge.

  	
   

  
	
  Section 6.15

  	
  Partnerships, New
  Subsidiaries.

  	
   

  
	
  Section 6.16

  	
  Speculative Transactions.

  	
   

  
	
  Section 6.17

  	
  Capital Expenditures.

  	
   

  
	
  Section 6.18

  	
  Issuance of Stock.

  	
   

  
	
  Section 6.19

  	
  Guaranteed Obligations.

  	
   

  
	
  Section 6.20

  	
  Use of
  Certain Earnings of Foreign Subsidiaries.

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE VII REPORTING REQUIREMENTS

  	
   

  
	
  Section 7.1

  	
  Default Notice.

  	
   

  
	
  Section 7.2

  	
  Quarterly Financials.

  	
   

  
	
  Section 7.3

  	
  Annual Financials.

  	
   

  
	
  Section 7.4

  	
  Annual Forecasts.

  	
   

  
	
  Section 7.5

  	
  ERISA Events and ERISA
  Reports.

  	
   

  
	
  Section 7.6

  	
  Plan Terminations.

  	
   

  
	
  Section 7.7

  	
  Actuarial Reports.

  	
   

  
	
  Section 7.8

  	
  Plan Annual Reports.

  	
   

  
	
  Section 7.9

  	
  Annual Plan Summaries.

  	
   

  
	
  Section 7.10

  	
  Multiemployer Plan Notices.

  	
   

  
	
  Section 7.11

  	
  Litigation.

  	
   

  
	
  Section 7.12

  	
  Securities Reports.

  	
   

  
	
  Section 7.13

  	
  Creditor Reports.

  	
   

  
	
  Section 7.14

  	
  Agreement Notices.

  	
   

  
	
  Section 7.15

  	
  Revenue Agent Reports.

  	
   

  
	
  Section 7.16

  	
  Environmental Conditions.

  	
   

  
	
  Section 7.17

  	
  Real Property.

  	
   

  
	
  Section 7.18

  	
  Insurance.

  	
   

  
	
  Section 7.19

  	
  Management Letters.

  	
   

  
	
  Section 7.20

  	
  Extraordinary or
  Unusual Items.

  	
   

  
	
  Section 7.21

  	
  Other Information.

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE VIII FINANCIAL COVENANTS

  	
   

  
	
  Section 8.1

  	
  Minimum EBITDA.

  	
   

  
	
  Section 8.2

  	
  Consolidated Debt to
  EBITDA Ratio.

  	
   

  
	
  Section 8.3

  	
  Fixed Charge Coverage
  Ratio.

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE IX EVENTS OF DEFAULT

  	
   

  
	
  Section 9.1

  	
  Payment.

  	
   

  
	
  Section 9.2

  	
  Representations and
  Warranties.

  	
   

  
	
  Section 9.3

  	
  Certain Covenants.

  	
   

  
	
  Section 9.4

  	
  Other Covenants.

  	
   

  
	
  Section 9.5

  	
  Other Defaults.

  	
   

  
	
  Section 9.6

  	
  Bankruptcy, Etc.

  	
   

  
	
  Section 9.7

  	
  Judgments.

  	
   

  
	
  Section 9.8

  	
  Loan Documents.

  	
   

  



 


iii





















 


	
  Section 9.9

  	
  Liens.

  	
   

  
	
  Section 9.10

  	
  Change of Control.

  	
   

  
	
  Section 9.11

  	
  ERISA Events.

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE X THE ADMINISTRATIVE AGENT

  	
   

  
	
  Section 10.1

  	
  Appointment and Authority.

  	
   

  
	
  Section 10.2

  	
  Rights as a Lender.

  	
   

  
	
  Section 10.3

  	
  Exculpatory Provisions.

  	
   

  
	
  Section 10.4

  	
  Reliance by
  Administrative Agent.

  	
   

  
	
  Section 10.5

  	
  Delegation of Duties.

  	
   

  
	
  Section 10.6

  	
  Resignation of
  Administrative Agent.

  	
   

  
	
  Section 10.7

  	
  Non-Reliance
  on Administrative Agent and Other Lenders.

  	
   

  
	
  Section 10.8

  	
  No Other Duties; Etc.

  	
   

  
	
  Section 10.9

  	
  Administrative
  Agent May File Proofs of Claim.

  	
   

  
	
  Section 10.10

  	
  Collateral and
  Guaranty Matters.

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE XI MISCELLANEOUS

  	
   

  
	
  Section 11.1

  	
  Amendments, Etc.

  	
   

  
	
  Section 11.2

  	
  Notices Etc.

  	
   

  
	
  Section 11.3

  	
  No Waiver; Remedies.

  	
   

  
	
  Section 11.4

  	
  Expenses;
  Indemnity; and Damage Waiver.

  	
   

  
	
  Section 11.5

  	
  Right of Set-off.

  	
   

  
	
  Section 11.6

  	
  Amendment
  and Restatement of Existing Credit Agreement.

  	
   

  
	
  Section 11.7

  	
  Successors and Assigns.

  	
   

  
	
  Section 11.8

  	
  Execution in Counterparts.

  	
   

  
	
  Section 11.9

  	
  No Liability of the
  Issuing Bank.

  	
   

  
	
  Section 11.10

  	
  Confidentiality.

  	
   

  
	
  Section 11.11

  	
  Further Assurances.

  	
   

  
	
  Section 11.12

  	
  Jurisdiction, Etc.

  	
   

  
	
  Section 11.13

  	
  GOVERNING LAW.

  	
   

  
	
  Section 11.14

  	
  WAIVER OF JURY TRIAL.

  	
   

  
	
  Section 11.15

  	
  Survival of
  Representations and Warranties.

  	
   

  
	
  Section 11.16

  	
  USA PATRIOT Act Notice.

  	
   

  



 


iv





















 


	
  EXHIBITS

  	
   

  	
   

  
	
  Exhibit A

  	
  -

  	
  Form of
  Assignment and Assumption

  
	
  Exhibit B

  	
  -

  	
  Form of
  Revolving Credit Promissory Note

  
	
  Exhibit C

  	
  -

  	
  Form of
  Term A Promissory Note

  
	
  Exhibit D

  	
  -

  	
  Form of
  Interim Term Promissory Note

  
	
  Exhibit E

  	
  -

  	
  Form of
  Swing Line Promissory Note

  
	
  Exhibit F

  	
  -

  	
  Form of
  Notice of Borrowing

  
	
  Exhibit G

  	
  -

  	
  Form of
  Intercompany Note

  
	
  Exhibit H

  	
  -

  	
  Form of
  Certificate of Exemption

  
	
   

  	
   

  	
   

  
	
  SCHEDULES

  	
   

  	
   

  
	
  Schedule 1

  	
  -

  	
  Commitments

  
	
  Schedule 4.2

  	
  -

  	
  Subsidiaries

  
	
  Schedule 4.9

  	
  -

  	
  Disclosed Litigation

  
	
  Schedule 4.11

  	
  -

  	
  Welfare Plans

  
	
  Schedule 4.13

  	
  -

  	
  Environmental Assessment Reports

  
	
  Schedule 4.14

  	
  -

  	
  Burdensome Documents

  
	
  Schedule 4.16(b)

  	
  -

  	
  Open Tax Years

  
	
  Schedule 4.16(c)

  	
  -

  	
  Audits

  
	
  Schedule 4.16(d)

  	
  -

  	
  Tax Adjustments

  
	
  Schedule 4.16(e)

  	
  -

  	
  Ownership Changes

  
	
  Schedule 4.19

  	
  -

  	
  Existing Debt

  
	
  Schedule 4.20

  	
  -

  	
  No Defaults

  
	
  Schedule 4.21

  	
  -

  	
  Owned Real Estate

  
	
  Schedule 4.22

  	
  -

  	
  Leased Real Estate

  
	
  Schedule 4.23

  	
  -

  	
  Material Contracts

  
	
  Schedule 4.24

  	
  -

  	
  Investments

  
	
  Schedule 4.25

  	
  -

  	
  Intellectual Property

  
	
  Schedule 6.1(c)

  	
  -

  	
  Liens

  
	
  Schedule 6.6(a)

  	
  -

  	
  Investments in Subsidiaries

  
	
  Schedule 6.6(f)

  	
  -

  	
  Existing Investments

  
	
  Schedule 6.18

  	
  -

  	
  Existing Issuances, Etc. of Stock

  
	
  Schedule 6.19

  	
  -

  	
  Guaranteed
  Obligations

  
	
  Schedule 11.2

  	
  -

  	
  Certain
  Notice Information

  



 


v





















 


AMENDED AND RESTATED CREDIT AGREEMENT


 


AMENDED AND RESTATED CREDIT AGREEMENT, dated as of August 1, 2005 (this “Agreement”)
by and among CANTEL MEDICAL CORP., a Delaware
corporation (the “Borrower”), the Lenders (as hereinafter defined), BANK OF AMERICA, N.A., as Issuing Bank (the “Issuing Bank”),
BANK OF AMERICA, N.A., as the Swing
Line Bank (the “Swing Line Bank”), and BANK OF
AMERICA, N.A., as Administrative Agent (together with any successor
appointed pursuant to Article X, the “Administrative Agent”)
for the Lender Parties (as hereinafter defined).


 


PRELIMINARY STATEMENT:


 


(1)           Pursuant
to five Stock Purchase Agreements, each dated as of August 1, 2005, (the “Purchase
Agreements”), by and among Borrower, Crosstex International, Inc., a
New York corporation (“Crosstex”) and the shareholders of Crosstex party
thereto (the “Sellers”), Crosstex and the Sellers have agreed to sell
and the Borrower has agreed to purchase all of the outstanding capital stock of
Crosstex (such transaction being hereinafter called the “Crosstex
Acquisition”).


 


(2)           The Borrower is party to a Credit
Agreement dated as of September 7, 2001 (as amended, supplemented or
otherwise modified from time to time until (but not including) the date of this
Agreement, the “Existing Credit Agreement”) with the Lenders and Bank of
America, N.A. (formerly Fleet National Bank), as administrative agent for the Lenders.


 


(3)           The parties to this Agreement desire
to amend the Existing Credit Agreement as set forth herein and to restate the
Existing Credit Agreement in its entirety to read as follows.  This Agreement is not a novation of the
Existing Credit Agreement.


 


(4)           The
Borrower has requested that the Lender Parties (as hereinafter defined) make
loans to the Borrower and issue letters of credit having an aggregate principal
and face amount at any one time outstanding of up to Ninety Million Seven
Hundred Fifty Thousand Dollars ($90,750,000), to be used by the Borrower solely
(a) to finance, in part, the Crosstex Acquisition and to pay fees and
expenses incurred in connection with the Crosstex Acquisition, (b) to
repay existing indebtedness, if any, and (c) to finance working capital
and capital expenditures of the Borrower, and the Lender Parties have agreed to
make such loans and issue such letters of credit all on and subject to the
terms and conditions of this Agreement.


 


NOW,
THEREFORE, in consideration of the premises and of the mutual covenants and
agreements contained herein, the parties hereto hereby agree as follows:


 


ARTICLE I


 


DEFINITIONS AND ACCOUNTING
TERMS


 


Section 1.1            Certain Defined Terms.


 


As
used in this Agreement, the following terms shall have the following meanings
(such meanings to be equally applicable to both the singular and plural forms
of the terms defined):


 


“Additional
Collateral Documents” has the meaning specified in Section 5.13(e).


 


“Administrative
Agent” has the meaning specified in the recital of parties to this
Agreement.


 





















 


“Administrative
Agent’s Account” means the account of the Administrative Agent maintained
by the Administrative Agent at its Domestic Lending Office.


 


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


 


“Advance”
means a Term A Advance, a Revolving Credit Advance, an Interim Term
Advance, a Swing Line Advance, or a Letter of Credit Advance.


 


“Affiliate”
means, as to any Person, any other Person that, directly or indirectly,
controls, is controlled by or is under common control with such Person or is a
director or officer of such Person.  For
purposes of this definition, the term “control” (including the terms “controlling,”
“controlled by” and “under common control with”) of a Person means the
possession, direct or indirect, of the power to vote 50% or more of the Voting
Stock of such Person or to direct or cause the direction of the management and
policies of such Person, whether through the ownership of Voting Stock, by
contract or otherwise.


 


“Applicable
Lending Office” means, with respect to each Lender Party, such Lender Party’s
Domestic Lending Office in the case of a Prime Rate Advance and such Lender
Party’s Eurodollar Lending Office in the case of a Eurodollar Rate Advance.


 


“Applicable
Margin” means at any time and from time to time a percentage per annum
determined pursuant to the last paragraph of this definition by reference to
the ratio of Consolidated Debt to EBITDA at such time, as set forth below:


 


Applicable
Margin for Advances


 


	
  Ratio of Consolidated

  Debt to EBITDA

  	
   

  	
  Eurodollar Rate

  Advances

  	
   

  	
  Prime Rate

  Advances

  	
   

  
	
  Greater than 2.0
  to 1.0

  	
   

  	
  2.00

  	
  %

  	
  0.75

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Greater than 1.5
  to 1.0 but less than or equal to 2.0 to 1.0

  	
   

  	
  1.50

  	
  %

  	
  0.25

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Greater than 1.0
  to 1.0 but less than or equal to 1.5 to 1.0

  	
   

  	
  1.25

  	
  %

  	
  0.00

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Equal to or less
  than 1.0 to 1.0

  	
   

  	
  1.00

  	
  %

  	
  0.00

  	
  %

  



 


Notwithstanding
the above rates, prior to the date that the Borrower has delivered the
financial information required by Section 7.2 for the fiscal
quarter ending October 31, 2005, the Applicable Margin for a Revolving
Credit Advance, a Term A Advance or an Interim Term Advance shall be 2.00% for
a Eurodollar Rate Advance and 0.75% for a Prime Rate Advance.


 


The
Applicable Margin for each Prime Rate Advance and each Eurodollar Rate Advance
shall be determined by reference to the ratio of Consolidated Debt to EBITDA
which shall be determined three Business Days after the date on which the
Administrative Agent receives financial statements pursuant to Section 7.2
or 7.3 and a certificate of the president or vice president of the
Borrower demonstrating the ratio of Consolidated Debt to EBITDA.  If the Borrower has  not submitted to the Administrative Agent the
information described above as and when required under Section 7.2
or 7.3, as the case may be, the Applicable Margin shall be,
irrespective of the actual ratio of Consolidated Debt to EBITDA, the highest
rate set forth above for the applicable Type of Advance for so long as such
information has not been received by the Administrative Agent.  The Applicable Margin shall be adjusted, if
applicable, as of the first day of the month following the date of
determination described in the two preceding sentences.


 


2





















 


“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.


 


“Arranger”
means Banc of America Securities LLC, in its capacity as sole lead arranger and
sole book manager.


 


“Asset
Disposition” means the disposition (not involving an Extraordinary Receipt)
of any or all of the fixed assets of the Borrower or any of its Subsidiaries whether
by sale, lease, transfer, or otherwise (including the sale of the equity or
ownership interests of a Subsidiary); provided, however, that for
purposes of Section 2.6(b), the term “Asset Disposition” (a) shall
not include (i) any sale, lease, transfer or other disposition of
Inventory in the ordinary course of business or (ii) any sale, lease,
transfer or other disposition of obsolete Equipment in the ordinary course of
business and (b) shall include the sale of Inventory and lease receivables
of Carsen to Olympus America Inc. and Olympus Surgical & Industrial
America, Inc. in connection with the Carsen Disposition.


 


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


 


“Assignment
and Assumption” means an assignment and assumption entered into by a Lender
Party and an Eligible Assignee, and accepted by the Administrative Agent and,
so long as no Event of Default shall have occurred and be continuing, by the
Borrower, in accordance with Section 11.7 and in substantially the
form of Exhibit A hereto.


 


“Available
Amount” of any Letter of Credit means, at any time, the maximum stated
amount available to be drawn under such Letter of Credit at such time (assuming
compliance at such time with all conditions to drawing).


 


“Bank
Hedge Agreement” means any interest rate Hedge Agreement that (i) is
entered into by and between a Loan Party and any Hedge Bank in
the ordinary course of business for the purpose of directly mitigating risks
associated with liabilities, commitments, investments, assets, or property held
or reasonably anticipated by such Loan Party, or changes in the value of
securities issued by such Loan Party, and not for purposes of speculation or taking
a “market view;” and (ii) does not contain any provision exonerating the
non-defaulting party from its obligation to make payments on outstanding
transactions to the defaulting party.


 


“Bank
of America” means Bank of America, N.A. and its successors.


 


“Borrower”
has the meaning specified in the recital of parties to this Agreement.


 


“Borrower’s
Account” means the account of the Borrower maintained by the Borrower with
Bank of America at its Domestic Lending Office.


 


“Borrowing”
means a Term A Borrowing, a Revolving Credit Borrowing, an Interim Term
Borrowing or a Swing Line Borrowing.


 


“Business
Day” means a day of the year on which banks are not required or authorized
by law to close in Boston, Massachusetts, Hackensack, New Jersey,
New York, New York or in the state where the Administrative Agent’s
office is located and, if the applicable Business Day relates to any Eurodollar
Rate Advances, on which dealings are carried on in the London interbank market.


 


3





















 


“Canadian
Credit Agreement” means that certain credit agreement dated September 7,
2001 between Carsen, as Borrower, and the Canadian Lender as amended from time
to time.


 


“Canadian
Dollars” means the lawful money of Canada.


 


“Canadian
Lender” means National Bank of Canada.


 


“Capital
Expenditures” means, for any Person for any period, the sum of all
expenditures made, directly or indirectly, by such Person or any of its
Subsidiaries during such period for Equipment, fixed assets, real property or
improvements, or for replacements or substitutions therefor or additions
thereto, that have been or should be, in accordance with GAAP, reflected as
additions to property, plant or Equipment on a Consolidated balance sheet of
such Person; provided, that Capital Expenditures shall not include
capital expenditures to the extent that such expenditures constitute a
reinvestment of Net Cash Proceeds from any Asset Disposition permitted under
this Agreement in similar fixed assets, which investment is made before or
within ninety (90) days after receipt of such Net Cash Proceeds.


 


“Capitalized
Leases” means all leases that have been or should be, in accordance with
GAAP, recorded as capitalized leases.


 


“Carsen”
means Carsen Group Inc., a company organized under the laws of the
Province of Ontario, Canada and a Wholly Owned Subsidiary of the Borrower.


 


“Carsen
Disposition” means the termination of Carsen’s distribution agreements with
Olympus America Inc. and Olympus Surgical & Industrial America, Inc.
and (i) the sale, transfer, assignment or other disposition of assets of
Carsen, whether or not in the ordinary course of business and (ii) the
liquidation, winding down, cessation, or dissolution of Carsen or one or more
of its business segments, in each case related to, arising out of or related to
such termination.


 


“Cash
Equivalents” means any of the following, to the extent owned by the
Borrower or any of its Subsidiaries, free and clear of all Liens other than
Liens created under the Collateral Documents: (a) readily marketable
direct obligations of the United States or any agency or instrumentality
thereof or obligations unconditionally guaranteed by the full faith and credit
of the United States having a maturity of not greater than one year from
the date of issuance thereof, (b) insured certificates of deposit of or
time deposits having a maturity of not greater than one year from the date of
issuance thereof with any commercial bank that is a Lender Party or a member of
the Federal Reserve System that issues (or the parent of which issues)
commercial paper rated as described in clause (c) and is organized
under the laws of the United States or any State thereof and has combined
capital and surplus of at least $1 billion or (c) commercial paper
having a maturity of not greater than 180 days from the date of issuance
thereof in an aggregate amount of no more than $2,500,000 per issuer
outstanding at any time, issued by any corporation organized under the laws of
any State of the United States and rated at least “Prime-1” (or the
then equivalent grade) by Moody’s Investors Service, Inc. or “A-1”
(or the then equivalent grade) by Standard & Poor’s Ratings Group.


 


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


 


“CERCLIS”
means the Comprehensive Environmental Response, Compensation and Liability
Information System maintained by the U.S. Environmental Protection Agency.


 


“Change
of Control” means a change of control of the Borrower that would be
required to be reported in response to Item 6(e) of Schedule 14A
of Regulation 14A, as in effect on the Closing Date,


 


4





















 


promulgated under the Securities Exchange Act of 1934, as amended (the “Exchange
Act”) shall occur; provided that, without limitation, such a Change
of Control shall be deemed to occur if: (i) any “Person” (as such term is
used in §13(d) and §14(d) of the Exchange Act), except for any
employee benefit plan of the Borrower or any Subsidiary or related corporation,
or any entity holding voting securities of the Borrower for or pursuant to the
terms of any such plan, shall become the beneficial owner, directly or
indirectly, of securities of the Borrower representing 30% or more (or in the
case of Charles M.  Diker, securities
representing 35% or more) of the combined voting power of the Borrower’s then
outstanding securities; (ii) there shall occur a contested proxy
solicitation of the Borrower’s shareholders that results in the contesting
party obtaining the ability to vote securities representing 30% (or in the case
of Charles M. Diker, securities representing 35% or more) or more of the
combined voting power of the Borrower’s then outstanding securities; (iii) there
shall occur: (A) a sale, exchange, transfer or other disposition of all or
substantially all of the assets of the Borrower to another entity, except to an
entity controlled directly or indirectly by the Borrower, (B) a merger or
consolidation in which the Borrower is a constituent unless the surviving
entity is controlled after the merger directly or indirectly by the same
Persons that controlled the Borrower immediately prior to such merger or
consolidation or (C) the adoption of a plan of liquidation or dissolution
of the Borrower other than pursuant to bankruptcy or insolvency laws; or (iv) during
any period of two consecutive years, individuals who at the beginning of such
period constituted the board of directors of the Borrower shall cease for any
reason to constitute at least a majority thereof unless the election, or the
nomination for election by the Borrower’s shareholders, of each new director
shall be approved by a vote of at least two-thirds (2/3rds) of the
directors then still in office who were directors at the beginning of the
period.  For purposes of this definition “control”,
when used with respect to any specified Person, means the power to direct the
management and policies of such Person, directly or indirectly, whether through
the ownership of voting securities, by contract, by family relationship or
otherwise; and the terms “controlling” and “controlled” have the meanings
correlative to the foregoing.


 


“Closing
Date” means August 1, 2005.


 


“Collateral”
means all “Collateral” referred to in the Collateral Documents and all other
property that is or is intended to be subject to any Lien in favor of the
Administrative Agent for the benefit of the Secured Parties.


 


“Collateral
Documents” means the Security Agreement, the Intellectual Property Security
Agreement, the Mortgages, the Note Assignment Agreement and any other agreement
that creates or purports to create a Lien in favor of the Administrative Agent
for the benefit of the Secured Parties, including the Additional Collateral
Documents delivered pursuant to Section 5.13.


 


“Commitment”
means a Term A Commitment, a Revolving Credit Commitment, an Interim Term
Commitment or a Letter of Credit Commitment.


 


“Consolidated”
refers to the consolidation of accounts, in accordance with GAAP, of any Person
and all of its Subsidiaries, and if not specified, the Borrower and all of its
Subsidiaries.


 


“Consolidated
Debt to EBITDA” means, as of any determination date, a ratio, all on a
Consolidated basis, of (a) Debt of the Borrower and its Subsidiaries as of
such date to (b) EBITDA for the most recently completed four fiscal
quarters of the Borrower and its Subsidiaries.


 


“Conversion”,
“Convert” and “Converted” each refer to a conversion of Advances
of one Type into Advances of the other Type pursuant to Section 2.9
or 2.10.


 


“Crosstex”
has the meaning specified in the Preliminary Statements.


 


5





















 


“Crosstex
Acquisition” has the meaning specified in the Preliminary Statements.


 


“Crosstex
Acquisition Documents” means the Purchase Agreements, and all other
agreements, instruments, certificates and all other documents, and all
schedules and exhibits related to each such agreement.


 


“Current
Assets” of any Person means all assets of such Person that would, in accordance
with GAAP, be classified as current assets of a company conducting a business
the same as or similar to that of such Person, after deducting adequate
reserves in each case in which a reserve is proper in accordance with GAAP.


 


“Current
Liabilities” of any Person means (a) Debt of such Person, except
Funded Debt, that by its terms is payable on demand or matures within one year
after the date of determination (excluding any Debt renewable or extendible, at
the option of such Person, to a date more than one year from such date or
arising under a revolving credit or similar agreement that obligates the lender
or lenders to extend credit during a period of more than one year from such
date), (b) all amounts of Funded Debt of such Person required to be paid or
prepaid within one year after such date and (c) all other items (including
taxes accrued as estimated but excluding Funded Debt) that in accordance with
GAAP would be classified as current liabilities of such Person.


 


“Debt”
of any Person means, without duplication, (a) all indebtedness of such
Person for borrowed money, (b) all obligations of such Person for the
deferred purchase price of property or services, excluding, however, trade
indebtedness, (c) all obligations of such Person evidenced by notes,
bonds, debentures or other similar instruments, (d) all obligations of
such Person created or arising under any conditional sale or other title
retention agreement with respect to property acquired by such Person (even
though the rights and remedies of the seller or lender under such agreement in
the event of default are limited to repossession or sale of such property), (e) all
obligations of such Person as lessee under Operating Leases or Capitalized
Leases, however, all obligations in connection with Operating Leases
shall be excluded from this definition of Debt for purposes of calculating the
financial covenants in Article VIII, (f) all obligations,
contingent or otherwise, of such Person under acceptance, letter of credit or
similar facilities, (g) all obligations of such Person to purchase,
redeem, retire, defease or otherwise make any payment in respect of any capital
stock of or other ownership or profit interest in such Person or any other
Person or any warrants, rights or options to acquire such capital stock, (h) all
obligations of such Person in respect of Hedge Agreements, net of any buying or
selling expenses incurred thereunder, however, all obligations in
connection with such Hedge Agreements shall be excluded from this definition of
Debt for purposes of calculating the financial covenants in Article VIII,
(i) all Debt of others referred to in clauses (a) through (h) above
or clause (j) below guaranteed directly or indirectly in any manner by
such Person, or in effect guaranteed directly or indirectly by such Person
through an agreement (i) to pay or purchase such Debt or to advance or
supply funds for the payment or purchase of such Debt, (ii) to purchase,
sell or lease (as lessee or lessor) property, or to purchase or sell services,
primarily for the purpose of enabling the debtor to make payment of such Debt
or to assure the holder of such Debt against loss, (iii) to supply funds
to or in any other manner invest in the debtor (including any agreement to pay
for property or services irrespective of whether such property is received or
such services are rendered) or (iv) otherwise to assure a creditor against
loss, and (j) all Debt referred to in clauses (a) through (i) above
of another Person secured by (or for which the holder of such Debt has an
existing right, contingent or otherwise, to be secured by) any Lien on property
owned by the Borrower or its Subsidiaries, even though the Borrower or its
Subsidiaries has not assumed or become liable for the payment of such Debt.


 


6





















 


“Debt
Issuance” means any issuance or sale or other incurrence by the Borrower or
any of its Subsidiaries of any Debt; provided, however, that for
purposes of determination of Net Cash Proceeds under Section 2.6(b)(ii),
the term “Debt Issuance” shall not include the incurrence of Debt permitted
under Section 6.2.


 


“Default”
means any Event of Default or any event that would constitute an Event of
Default but for the requirement that notice be given or time elapse or both.


 


“Defaulted
Advance” means, with respect to any Lender Party at any time, the portion
of any Advance required to be made by such Lender Party to the Borrower
pursuant to Section 2.1 or 2.2 at or prior to such time
which has not been made by such Lender Party or by the Administrative Agent for
the account of such Lender Party pursuant to Section 2.2(e) as
of such time.  In the event that a
portion of a Defaulted Advance shall be deemed made pursuant to Section 2.15(a),
the remaining portion of such Defaulted Advance shall be considered a Defaulted
Advance originally required to be made pursuant to Section 2.1 on
the same date as the Defaulted Advance so deemed made in part.


 


“Defaulted
Amount” means, with respect to any Lender Party at any time, any amount
required to be paid by such Lender Party to the Administrative Agent or any
other Lender Party hereunder or under any other Loan Document at or prior to
such time which has not been so paid as of such time, including, without
limitation, any amount required to be paid by such Lender Party to (a) the
Swing Line Bank pursuant to Section 2.2(b) to purchase a
portion of a Swing Line Advance made by the Swing Line Bank, (b) the
Issuing Bank pursuant to Section 2.3(c) to purchase a portion
of a Letter of Credit Advance made by the Issuing Bank, (c) the
Administrative Agent pursuant to Section 2.2(e) to reimburse
the Administrative Agent for the amount of any Advance made by the
Administrative Agent for the account of such Lender Party, (d) any other
Lender Party pursuant to Section 2.13 to purchase any participation
in Advances owing to such other Lender Party and (e) the Administrative
Agent or the Issuing Bank pursuant to Section 11.4(c) to
reimburse the Administrative Agent or the Issuing Bank for such Lender Party’s ratable
share of any amount required to be paid by the Lender Parties to the
Administrative Agent or the Issuing Bank as provided therein.  In the event that a portion of a Defaulted
Amount shall be deemed paid pursuant to Section 2.15(b), the
remaining portion of such Defaulted Amount shall be considered a Defaulted
Amount originally required to be paid hereunder or under any other Loan
Document on the same date as the Defaulted Amount so deemed paid in part.


 


“Defaulting
Lender” means, at any time, any Lender Party that, at such time, (a) owes
a Defaulted Advance or a Defaulted Amount or (b) shall take any action or
be the subject of any action or proceeding of a type described in Section 9.6.


 


“Default
Rate” has the meaning specified in Section 2.7(b).


 


“Disclosed
Litigation” has the meaning specified in Section 4.9.


 


“Disposal”
means the discharge, deposit, injection, dumping, spilling, leaking or placing
of any solid waste or hazardous waste, as those terms are defined by any
federal, state, local or foreign law, into or on any land or water so that such
solid waste or hazardous waste or any constituents thereof may enter the
environment or be emitted into the air or discharged into any waters, including
ground waters.


 


“Dollars”
unless otherwise specified, means dollars constituting legal tender for the
payment of public and private debts in the United States.


 


7





















 


“Domestic
Lending Office” means, as to any Lender Party, the office or offices of
such Lender Party described as such in such Lender Party’s Administrative
Questionnaire, or such other office or offices as a Lender may from time to
time notify the Borrower and the Administrative Agent.


 


“Domestic
Subsidiary” means any Subsidiary organized under the laws of the
United States or any State thereof.


 


“EBITDA”
means, for any period, the sum, for the Borrower and its Subsidiaries
determined on a Consolidated basis, of (i) net income (or net loss), (ii) Interest
Expense, (iii) income tax expense, (iv) depreciation expense, (v) extraordinary
and nonrecurring losses and (vi) amortization expense, minus
extraordinary and nonrecurring gains (in each case determined in accordance
with GAAP).


 


“Eligible
Assignee” means (a) a Lender; (b) an Affiliate of a Lender; (c) an
Approved Fund; and (d) any other Person (other than a natural person)
approved by (i) the Administrative Agent (and in the case of an assignment
of a Revolving Credit Commitment, the Issuing Bank and the Swing Line Bank),
and (ii) unless an Event of Default has occurred and is continuing, the
Borrower (each such approval not to be unreasonably withheld or delayed);
provided that notwithstanding the foregoing, “Eligible Assignee” shall not
include the Borrower or any of the Borrower’s Affiliates or Subsidiaries.


 


“Environmental
Action” means any action, suit, demand, demand letter, claim, notice of non-compliance
or violation, notice of liability or potential liability, investigation,
proceeding, consent order or consent agreement relating in any way to any
Environmental Law, any Environmental Permit or Hazardous Material or arising
from alleged injury or threat to public health and safety or the environment,
including, without limitation, (a) by any governmental or regulatory
authority or third party for enforcement, cleanup, Removal, Response, Remedial
or other actions or damages and (b) by any governmental or regulatory
authority or third party for damages, contribution, indemnification, cost
recovery, compensation or injunctive relief.


 


“Environmental
Law” means any international or transnational law, federal, state, local or
foreign statute, law, ordinance, rule, regulation, code, order, writ, judgment,
injunction, decree or judicial or agency interpretation, policy or guidance
relating to pollution or protection of the environment or natural resources,
including, without limitation, those relating to the use, handling,
transportation, treatment, storage, disposal, threatened release, release or
discharge of Hazardous Materials.


 


“Environmental
Permit” means any permit, approval, identification number, license or other
authorization required under any Environmental Law.


 


“Equipment”
has the meaning specified in Annex A to the Security Agreement.


 


“Equity
Compensation Plan” means a Stock Option Plan, stock purchase plan or any
other equity compensation plan currently maintained by a Loan Party or which
may be adopted after the Closing Date.


 


“Equity
Issuance” means any sale or issuance by the Borrower or any of its
Subsidiaries of any capital stock or other ownership or profit interest, any
securities convertible or exchangeable for capital stock or other ownership or
profit interest or any warrants, rights or options to acquire capital stock or
other ownership or profit interest; provided, however, that for
purposes of determination of Net Cash Proceeds under Section 2.6(b)(iii),
the term “Equity Issuance” shall not include any issuance or sale of (a) capital
stock of the Borrower issued on or before the Closing Date in connection with
the Crosstex Acquisition; (b) capital stock of the Borrower issued in
connection with a Permitted Acquisition, (c) common stock issued to any
director required by applicable law in connection with such Person acting in
such capacity; (d) common stock or options of the Borrower to directors,
officers and employees of the


 


8





















 


Borrower or its Subsidiaries pursuant to an Equity Compensation Plan or
as permitted hereunder or the exercise of options issued pursuant thereto and (e) a
common stock issuances with a value of no more than $10,000.


 


“ERISA”
means the Employee Retirement Income Security Act of 1974, as amended from time
to time, and the regulations promulgated and rulings issued thereunder.


 


“ERISA
Affiliate” means any Person that for purposes of Title IV of ERISA is
a member of the controlled group of any Loan Party, or under common control
with any Loan Party, within the meaning of Section 414 of the Internal
Revenue Code.


 


“ERISA
Event” means (a) (i) the occurrence of a reportable event, within
the meaning of Section 4043 of ERISA, with respect to any Plan unless the
30-day notice requirement with respect to such event has been waived by
the PBGC, or (ii) the requirements of subsection (1) of Section 4043(b) of
ERISA (without regard to subsection (2) of such Section) are met with
respect to a contributing sponsor, as defined in Section 4001(a)(13) of
ERISA, of a Plan, and an event described in paragraph (9), (10), (11),
(12) or (13) of Section 4043(c) of ERISA is reasonably expected
to occur with respect to such Plan within the following 30 days; (b) the
application for a minimum funding waiver with respect to a Plan; (c) the
provision by the administrator of any Plan of a notice of intent to terminate
such Plan under ERISA Section 4041(c), pursuant to Section 4041(a)(2) of
ERISA (including any such notice with respect to a plan amendment referred to
in Section 4041(e) of ERISA); (d) the cessation of operations at
a facility of any Loan Party or any ERISA Affiliate in the circumstances
described in Section 4062(e) of ERISA; (e) the withdrawal by any
Loan Party or any ERISA Affiliate from a Multiple Employer Plan during a plan
year for which it was a substantial employer, as defined in Section 4001(a)(2) of
ERISA; (f) the conditions for imposition of a lien under Section 302(f) of
ERISA shall have been met with respect to any Plan; (g) the adoption of an
amendment to a Plan requiring the provision of security to such Plan pursuant
to Section 307 of ERISA; or (h) the institution by the PBGC of
proceedings to terminate a Plan pursuant to Section 4042 of ERISA, or the
occurrence of any event or condition described in Section 4042 of ERISA
that constitutes grounds for the termination of, or the appointment of a
trustee to administer, such Plan.


 


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


 


“Eurodollar
Lending Office” means, as to any Lender Party, the office or offices of
such Lender Party described as such in such Lender Party’s Administrative
Questionnaire, or such other office or offices as a Lender may from time to
time notify the Borrower and the Administrative Agent.


 


9





















 


“Eurodollar
Rate” means, for any Interest Period with respect to any Eurodollar Rate
Advance comprising part of the same Borrowing, a rate per annum determined by
the Administrative Agent to be equal to the quotient obtained by dividing (a) the
Eurodollar Base Rate for such Eurodollar Rate Advance for such Interest Period
by (b) one minus the Eurodollar Rate Reserve Percentage for such
Eurodollar Rate Advance for such Interest Period.


 


“Eurodollar
Rate Advance” means an Advance that bears interest as provided in Section 2.7(a)(ii).


 


“Eurodollar
Rate Reserve Percentage” means, for any day during any Interest Period, the
reserve percentage (expressed as a decimal, carried out to five decimal places)
in effect on such day, whether or not applicable to any Lender, under
regulations issued from time to time by the Board of Governors of the Federal
Reserve System for determining the maximum reserve requirement (including any
emergency, supplemental or other marginal reserve requirement) with respect to
Eurocurrency funding (currently referred to as “Eurocurrency liabilities”).  The Eurodollar Rate for each outstanding
Eurodollar Rate Advance shall be adjusted automatically as of the effective
date of any change in the Eurodollar Rate Reserve Percentage.


 


“Events
of Default” has the meaning specified in Article IX.


 


“Excess
Cash Flow” means for any period the sum of (a) EBITDA of the Borrower
and its Subsidiaries for such period plus (b) the aggregate amount
of all non-cash charges deducted from Consolidated net income for such period,
but not added back in arriving at EBITDA plus (c) if there was a
net increase in Consolidated Current Liabilities of the Borrower and its
Subsidiaries during such period, the amount of such net increase other than
arising out of Debt permitted pursuant to Section 6.2  plus (d) if
there was a net decrease in Consolidated Current Assets (excluding cash and
Cash Equivalents and other than as reflected in clause (n) or (o) hereof) of
the Borrower and its Subsidiaries during such period the amount of such net
decrease less (e) the aggregate amount of mandatory and optional
prepayments (other than optional prepayments of the Swing Line Advances, Letter
of Credit Advances or Revolving Credit Advances made pursuant to clause (i) of
the second sentence of Section 2.6(a), unless accompanied by a
corresponding permanent reduction of the Revolving Credit Facility) or
repayments of principal made by the Borrower and its Subsidiaries on any Funded
Debt of the Borrower and its Subsidiaries during such period less (f) the
non-financed portion of Capital Expenditures of the Borrower and its
Subsidiaries during such period less (g) the aggregate amount of
all federal, state, local and foreign taxes paid by the Borrower and its
Subsidiaries during such period (or within ninety (90) days of the
calculation date) less (h) the aggregate amount of interest paid on
any Debt of the Borrower and its Subsidiaries during such period less (i) the
aggregate amount of all non-cash credits included in arriving at such EBITDA less
(j) if there was a net decrease in Consolidated Current Liabilities of the
Borrower and its Subsidiaries during such period, the amount of such net
decrease less (k) if there was a net increase in Consolidated
Current Assets (excluding cash and Cash Equivalents and other than as reflected
in clause (n) or (o) hereof) of the Borrower and its Subsidiaries during such
period the amount of such increase less (l) cash dividends paid by
the Borrower to the holders of its common stock during such period to the
extent that the Borrower is expressly permitted to pay such dividends under
this Agreement less (m) the non-financed
cash portion of the purchase price of Permitted Acquisitions during such period
less (n) the cash payments of approximately $6 million to be made by Olympus
America Inc. and/or Olympus Surgical & Industrial America, Inc.
to Carsen pursuant to an agreement executed on July 25, 2005 less
(o) to the extent included in Consolidated net income for such period, the Net
Cash Proceeds received by the Borrower and its Subsidiaries from the sale of
Inventory and lease receivables of Carsen to Olympus America Inc. and Olympus Surgical &
Industrial America, Inc. in connection with the Carsen Disposition.


 


“Existing
Credit Agreement” has the meaning specified in the Preliminary Statements.


 


10





















 


“Extraordinary
Receipt” means any cash received by or paid to or for the account of any
Person not in the ordinary course of business, including, without limitation,
tax refunds, pension plan reversions, proceeds of insurance (other than
proceeds of business income insurance to the extent such proceeds constitute
compensation for lost earnings), condemnation awards (and payments in lieu
thereof) and indemnity payments; provided, however, that an
Extraordinary Receipt shall not include cash receipts received from proceeds of
insurance, condemnation awards (and payments in lieu thereof) or indemnity
payments to the extent that such proceeds, awards or payments (a) in
respect of loss or damage to Equipment, fixed assets or real property are
applied (or in respect of which expenditures were previously incurred) to
replace or repair the Equipment, fixed assets or real property in respect of
which such proceeds, awards or payments were received in accordance with the
terms of the Loan Documents, so long as (i) such application is made
within one hundred eighty (180) days after such Person’s receipt of such
proceeds, awards or payments and (ii) such proceeds, awards or payments
are received by such Person within eighteen (18) months after the
occurrence of such damage or loss; or (b) are received by any Person in
respect of any third party claim against such Person and applied to pay (or to
reimburse such Person for its prior payment of) such claim and the costs and
expenses of such Person with respect thereto. 
“Extraordinary Receipts” shall not be deemed to include any Debt
Issuance, Equity Issuance, Asset Disposition or the Carsen Disposition.


 


“Facility”
means the Term A Facility, the Revolving Credit Facility, the Interim Term
Facility, the Letter of Credit Facility or the Swing Line Facility.


 


“Federal
Funds Rate” means, for any day, the rate per annum 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 (rounded upward, if necessary, to a whole multiple of 1/100 of 1%)
charged to Bank of America on such day on such transactions as determined by
the Administrative Agent.


 


“Fee
Letter” means the letter agreement, dated June 30, 2005 among the
Borrower, the Administrative Agent and the Arranger.


 


“Fiscal
Year” means a fiscal year of the Borrower and its Consolidated Subsidiaries
ending on July 31 in any calendar year.


 


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


 


“Fund”
means 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, with respect to the Borrower, the Advances, and with respect
to the Borrower and the other Loan Parties and any other Person, all other Debt
of such Person that by its terms matures more than one year after the date of
determination or matures within one year from such date but is renewable or
extendible, at the option of such Person, to a date more than one year after
such date or arises under a revolving credit or similar agreement that
obligates the lender or lenders to extend credit during a period of more than
one year after such date, including the current portion of all such Debt.


 


11





















 


“GAAP”
means generally accepted accounting principles in the United States set forth
in the opinions and pronouncements of the Accounting Principles Board and the
American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board, consistently
applied and as in effect from time to time.


 


“Guaranteed
Obligations” means, as to any Person, any obligation of such Person
guaranteeing any indebtedness, rent or any other payment or obligation of the
lessee under a lease of real or personal property, dividend, or other
obligation (“primary obligations”) of any other Person (the “primary
obligor”) in any manner, including any obligation or arrangement of such
Person (a) to purchase or repurchase any such primary obligation, (b) to
advance or supply funds (i) for the purchase or payment of any such
primary obligation or (ii) to maintain working capital or equity capital
of the primary obligor or otherwise to maintain the net worth or solvency or
any balance sheet condition of the primary obligor, (c) to purchase
property, securities or services primarily for the purpose of assuring the
owner of any such primary obligation of the ability of the primary obligor to
make payment of such primary obligation, or (d) to indemnify the owner of
such primary obligation against loss in respect thereof.  The amount of any Guaranteed Obligation at
any time shall be deemed to be an amount equal to the lesser at such time of
(x) the stated or determinable amount of the primary obligation in respect
of which such Guaranteed Obligation is made and (y) the maximum amount for
which such Person may be liable pursuant to the terms of the instrument
embodying such Guaranteed Obligation; or, if not stated or determinable, the
maximum reasonably anticipated liability (assuming full performance) in respect
thereof.


 


“Guarantors”
means (a) each Domestic Subsidiary of the Borrower and (b) each
Person which shall have executed and delivered or become a party to a Guaranty
hereunder.


 


“Guaranty”
means the Subsidiary Guaranty.


 


“Hazardous
Materials” means (a) petroleum or petroleum products, by-products or
breakdown products, radioactive materials, asbestos-containing materials,
polychlorinated biphenyls and radon gas and (b) any other chemicals,
materials or substances designated, classified or regulated as hazardous or
toxic or as a pollutant or contaminant under any Environmental Law.


 


“Hedge
Agreements” means interest rate swap, cap or collar agreements, interest
rate future or option contracts, currency swap agreements, currency future or
option contracts and other similar agreements.


 


“Hedge
Bank” means any Lender Party (or an Affiliate thereof) in its capacity as a
party to a Bank Hedge Agreement.


 


“Indemnitee”
has the meaning specified in Section 11.4(b).


 


“Initial
Extension of Credit” means the earlier to occur of the initial Borrowing or
the initial issuance of a Letter of Credit.


 


“Insufficiency”
means, with respect to any Plan, the amount, if any, of its unfunded benefit
liabilities, as defined in Section 4001(a)(18) of ERISA.


 


“Intellectual
Property Security Agreement” means the amended and restated intellectual
property security agreement dated as of the Closing Date executed in favor of
the Administrative Agent by the Loan Parties.


 


“Intercompany
Note” has the meaning specified in Section 3.1(a)(ii)(E).


 


12





















 


“Interest
Expense” means, with respect to any Person for any period, interest expense
on all Debt of such Person for such period, whether paid or accrued, net of
interest income actually received in cash within one year of incurrence for
such period, determined on a Consolidated basis for such Person and its
Subsidiaries and in accordance with GAAP, and including, without limitation, (a) in
the case of the Borrower, interest expense in respect of Debt resulting from
Advances, (b) the interest component of all obligations under Capitalized
Leases, (c) commissions, discounts and other fees and charges payable in
connection with letters of credit (including, without limitation, Letters of
Credit), (d) the net payment, if any, payable in connection with Hedge
Agreements less the net credit, if any, received in connection with Hedge
Agreements and (e) all fees paid by the Borrower pursuant to Section 2.8(a) excluding,
however, all amortized costs attributable to fees and closing costs paid by the
Borrower to the Lenders in connection herewith.


 


“Interest
Period” means, for each Eurodollar Rate Advance comprising part of the same
Borrowing, the period commencing on the date of such Eurodollar Rate Advance or
the date of the Conversion of any Prime Rate Advance into such Eurodollar Rate
Advance, and ending on the last day of the period selected by the Borrower pursuant
to the provisions below and, thereafter, each subsequent period commencing on
the last day of the immediately preceding Interest Period and ending on the
last day of the period selected by the Borrower pursuant to the provisions
below.  The duration of each such
Interest Period shall be one, two, three or six months (or, subject to
availability, nine or twelve months), as the Borrower may, upon notice received
by the Administrative Agent not later than 11:00 a.m. (New York time)
on the third Business Day prior to the first day of such Interest Period,
select; provided, however, that:


 


(a)           The
Borrower may not select any Interest Period with respect to any Eurodollar Rate
Advance under a Facility that ends after any principal repayment installment
date for such Facility unless, after giving effect to such selection, the
aggregate principal amount of Prime Rate Advances and of Eurodollar Rate
Advances having Interest Periods that end on or prior to such principal
repayment installment date for such Facility shall be at least equal to the
aggregate principal amount of Advances under such Facility due and payable on
or prior to such date;


 


(b)           Whenever
the last day of any Interest Period would otherwise occur on a day other than a
Business Day, the last day of such Interest Period shall be extended to occur
on the next succeeding Business Day, provided, however, that, if
such extension would cause the last day of such Interest Period to occur in the
next following calendar month, the last day of such Interest Period shall occur
on the next preceding Business Day; and


 


(c)           Whenever
the first day of any Interest Period occurs on a day of an initial calendar
month for which there is no numerically corresponding day in the calendar month
that succeeds such initial calendar month, such Interest Period shall end on
the last Business Day of such succeeding calendar month.


 


“Intercreditor
Agreement” means that certain Intercreditor Agreement dated as of September 7,
2001 among the Administrative Agent and the Canadian Lender.


 


“Interim
Term Advance” has the meaning specified in Section 2.1(e).


 


“Interim
Term Borrowing” means a borrowing consisting of simultaneous Interim Term Advances of the same Type made by the Interim Term Lenders.


 


13





















 


“Interim
Term Commitment” means, with respect to any Interim Term Lender at
any time, the amount set forth opposite such Lender’s name on Schedule 1
hereto under the caption “Interim Term Commitment” or, if such Lender has
entered into one or more Assignments and Acceptances, set forth for such Lender
in the Register maintained by the Administrative Agent pursuant to Section 11.7(c) as
such Lender’s “Interim Term Commitment.”


 


“Interim
Term Facility” means, at any time, the aggregate amount of the Interim Term
Lenders’ Interim Term Commitments at such time. 
The initial amount of the Interim Term Facility in effect on the Closing
Date is FIFTEEN MILLION SEVEN HUNDRED FIFTY THOUSAND DOLLARS  ($15,750,000).


 


“Interim
Term Lender” means any Lender that has an Interim Term Commitment.


 


“Interim
Term Note” means a promissory note of the Borrower payable to the order of
any Interim Term Lender, in substantially the form of Exhibit D
hereto, evidencing the indebtedness of the Borrower to such Lender resulting
from the Interim Term Advance made by such Lender.


 


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


 


“Inventory”
has the meaning specified in Annex A to the Security Agreement.


 


“Investment”
in any Person means any loan or advance to such Person, any purchase or other
acquisition of any capital stock or other ownership or profit interest,
warrants, rights, options, obligations or other securities of such Person, any
capital contribution to such Person or any other investment in such Person,
including, without limitation, any arrangement pursuant to which the investor
incurs Debt of the types referred to in clause (i) or (j) of the
definition of “Debt” in respect of such Person.


 


“IRS”
means the Internal Revenue Service, and any governmental authority succeeding
to any of its principal functions under the Internal Revenue Code.


 


“Issuer
Documents” means with respect to any Letter of Credit, the Letter of Credit
Application, and any other document, agreement and instrument entered into by
the Issuing Bank and the Borrower (or any Subsidiary) or in favor the Issuing
Bank and relating to any such Letter of Credit.


 


“Issuing
Bank” means Bank of America in its capacity as issuer of Letters of Credit
hereunder, or any successor issuer of Letters of Credit hereunder.


 


“Japanese
Yen” means the lawful money of Japan.


 


“L/C
Cash Collateral Account” has the meaning specified in the Security
Agreement.


 


“Lender
Party” means any Lender, the Issuing Bank or the Swing Line Bank.


 


“Lenders”
means each of the Persons identified as a “Lender” on the signature pages hereto
and their successors and assigns.


 


“Letter
of Credit” means any Letter of Credit issued hereunder (as specified in Section 2.3(a)).


 


“Letter
of Credit Advance” means an advance made by the Issuing Bank or any
Revolving Credit Lender pursuant to Section 2.3(c).


 


14





















 


“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 Bank.


 


“Letter
of Credit Commitment” means, with respect to the Issuing Bank, an amount
equal to the lesser of (a) the Revolving Credit Facility and (b) $10,000,000.


 


“Letter
of Credit Facility” means, at any time, an amount equal to the amount of
the Issuing Bank’s Letter of Credit Commitment at such time.


 


“Letter
of Credit Fee” has the meaning specified in Section 2.8.


 


“Lien”
means any lien, mortgage, pledge, security interest or other charge or
encumbrance of any kind, or any other type of preferential arrangement,
including, without limitation, the lien or retained security title of a
conditional vendor and any easement, right of way or other encumbrance on title
to real property.


 


“Loan
Documents” means (a) this Agreement, (b) each Note, (c) each
Guaranty, (d) the Collateral Documents, (e) each Issuer Document, (f) each
Additional Collateral Document, and all other agreements, instruments and
documents executed in connection therewith, in each case as the same may at any
time be amended, supplemented, restated or otherwise modified and in effect.


 


“Loan
Parties” means the Borrower and each Guarantor.


 


“Margin
Stock” has the meaning specified in Regulation U.


 


“Material
Adverse Change” means any material adverse change (excluding any such change
resulting from the Carsen Disposition) in (a) the business, condition
(financial or otherwise), results of operations or properties of the Borrower
and its Subsidiaries (taken as a whole), (b) the ability of any Loan Party
to perform its obligations under the Loan Documents to which it is a party or (c) any
material aspect of the Transaction.


 


“Material
Adverse Effect” means a material adverse effect (excluding any such effect
resulting from the Carsen Disposition) on (a) the condition (financial or
otherwise), business, operations, properties and/or prospects of Borrower and
its Subsidiaries, taken as a whole, (b) the ability of any Loan Party to
perform its obligations under the Loan Documents to which it is a party or (c) upon
the legality, validity, binding effect or enforceability against any Loan Party
of any Loan Document to which it is a party.


 


“Material
Contract” means, with respect to any Person, each contract listed on Schedule 4.23,
each contract which is a replacement or a substitute for any contract listed on
such Schedule and each other contract to which such Person is a party
which is material to the business, condition (financial or otherwise),
operations, performance, properties or prospects of such Person.


 


“Mortgage”
means each mortgage, deed of trust or other similar document executed and
delivered by the appropriate Loan Party, in form and substance acceptable to
the Administrative Agent and the Lenders in order (a) to provide that such
Loan Party is the mortgagor or grantor, (b) to comply with and/or provide
for specific laws of the jurisdictions in which the property to be encumbered
is located, and (c) to assure that the Administrative Agent for the
benefit of the Secured Parties has a perfected Lien on the Mortgaged Property.


 


“Mortgage
Policies” has the meaning assigned to that term in Section 3.1(a)(iii)(B).


 


15





















 


“Mortgaged
Property” means each parcel of real property (including any leaseholds)
specified on Schedule 4.21 or 4.22 that is subject to a
Mortgage and shall include any parcel (or adjoining parcels) of real property
(including any leaseholds) acquired by any Loan Party after the Closing Date
subject to a Mortgage granted to the Administrative Agent for the benefit of
the Secured Parties pursuant to Section 5.13.


 


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


 


“Multiple
Employer Plan” means a single employer plan, as defined in Section 4001(a)(15)
of ERISA, that (a) is maintained for employees of any Loan Party or any
ERISA Affiliate and at least one Person other than the Loan Parties and the
ERISA Affiliates or (b) was so maintained and in respect of which any Loan
Party or any ERISA Affiliate could have liability under Section 4064
or 4069 of ERISA in the event such plan has been or were to be terminated.


 


“Net
Cash Proceeds” means, with respect to any Asset Disposition or any Debt
Issuance or Equity Issuance by any Person, or any Extraordinary Receipt
received by or paid to or for the account of any Person, the aggregate amount
of cash received from time to time (whether as initial consideration or through
payment or disposition of deferred consideration) by or on behalf of such
Person in connection with such transaction after deducting therefrom only
(without duplication) (a) reasonable and customary brokerage commissions,
underwriting fees and discounts, legal fees, finder’s fees, filing fees and
other similar out-of-pocket costs, (b) the amount of taxes payable in
connection with or as a result of such transaction and (c) with respect to
any asset, the amount of any Debt secured by a Lien on such asset that, by the
terms of such transaction, is required to be repaid upon such disposition, in
the case of (a) or (c) above to the extent, but only to the
extent, that the amounts so deducted are, at the time of receipt of such cash,
actually paid to a Person that is not an Affiliate of such Person or any Loan
Party or any Affiliate of any Loan Party and are properly attributable to such
transaction or to the asset that is the subject thereof.  Notwithstanding the forgoing, for purposes of
Sections 2.6(b)(ii), (iii) and (iv) the term “Net Cash Proceeds”
shall not include (i) approximately $6 million in cash payments to be
made by Olympus America Inc. and/or Olympus Surgical & Industrial
America, Inc. to Carsen pursuant to an agreement executed on July 25,
2005 and (ii) the first $5,000,000 of cash proceeds received by the
Borrower and its Subsidiaries (net of obligations owed to Olympus America Inc.
and/or Olympus Surgical & Industrial America, Inc.) from the sale
of Inventory and lease receivables of Carsen to Olympus America Inc. and
Olympus Surgical & Industrial America, Inc. in connection with
the Carsen Disposition.


 


“Non-U.S.
Lender” has the meaning specified in Section 2.12(e).


 


“Note”
means a Term A Note, a Revolving Credit Note, an Interim Term Note or a
Swing Line Note.


 


“Note
Assignment Agreement” has the meaning specified in Section 3.1(a)(ii)(G).


 


“Notice
of Borrowing” has the meaning specified in Section 2.2(a).


 


“Notice
of Swing Line Borrowing” has the meaning specified in Section 2.2(b).


 


“NPL”
means the National Priorities List under CERCLA.


 


16





















 


“Obligation”
means all advances to, and debts, liabilities, obligations, covenants and
duties of, any Loan Party arising under any Loan Document or otherwise with
respect to any Advance or Letter of Credit, whether direct or indirect
(including those acquired by assumption), absolute or contingent, due or to
become due, now existing or hereafter arising and including interest and fees
that accrue after the commencement by or against any Loan Party or any
Affiliate thereof of any proceeding under the Federal Bankruptcy Code or any
similar debtor relief laws naming such Person as the debtor in such proceeding,
regardless of whether such interest and fees are allowed claims in such
proceeding. The foregoing shall also include (a) all obligations owing by
any Loan Party under any Bank Hedge Agreement and (b) all obligations
owing by any Loan Party under any Treasury Management Agreement.


 


“Open
Year” has the meaning specified in Section 4.16.


 


“Operating
Leases” means any lease of real or personal property the payments under which
are not required by GAAP to be capitalized.


 


“Other
Taxes” has the meaning specified in Section 2.12(b).


 


“Participant”
has the meaning specified in Section 11.7(d).


 


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


 


“Permitted
Acquisitions” means any acquisition by the Borrower or any of  the Borrower’s Subsidiaries of all or
substantially all of the assets or the capital stock or other equity interest
of any Person (or segment of such Person’s business) which either (a) has been
consented to in writing by the Administrative Agent and the Required Lenders,
or (b) complies with each of the following: (i) such Person (or
segment of such Person’s business) is engaged in a similar or related line of
business as the Borrower or any of its Subsidiaries, (ii) the aggregate
cash consideration payable and Debt assumed in respect of the proposed
acquisition shall not exceed $25,000,000, during the term of this Agreement, (iii) such
Person (or segment of such Person’s business) on a Consolidated basis with its
Subsidiaries being acquired in the proposed acquisition had positive EBITDA for
the twelve (12) month period ending on the last day of the calendar month
immediately preceding the closing of the proposed acquisition, (iv) after
giving effect to the proposed acquisition, the Revolving Credit Availability
shall equal at least $5,000,000, (v) the Borrower shall give the
Administrative Agent and the Lenders not less than ten (10) Business
Days prior written notice of its intention to make a Permitted Acquisition,
such notice to include the proposed amounts, date and form of the proposed
transaction, a reasonable description of the stock or assets to be acquired and
the location of all assets, and a certificate demonstrating compliance with the
financial covenants contained in Article VIII on a Pro Forma Basis
after giving effect to the consummation of such acquisition, (vi) concurrently
with the making of a Permitted Acquisition, the Borrower shall, as additional
collateral security for the Obligations, grant or cause to be granted to the
Administrative Agent for the ratable benefit of the Lenders, prior liens on and
security interests (subject to Liens permitted by Section 6.1
existing with respect to such assets at the time of the Permitted Acquisition)
in any of the acquired assets by the execution and delivery to the
Administrative Agent of such agreements, instruments and documents as shall be
reasonably satisfactory in form and substance to the Administrative Agent, and (vii) no
Default shall exist and be continuing or would exist after giving effect to
such acquisition; provided, however, that only one such Permitted
Acquisition shall be made each Fiscal Year during the term of this Agreement
pursuant to clause (b) hereof.


 


 “Permitted Liens” means such of the
following as to which no enforcement, collection, execution, levy or
foreclosure proceeding shall have been commenced: (a) Liens for taxes,
assessments and governmental charges or levies not yet due and payable; provided
that provisions for the payment of such Liens has been made on the books of
such Person; (b) Liens imposed by law, such as statutory liens


 


17





















 


of landlords, materialmen’s, mechanics’, carriers’, workmen’s and
repairmen’s Liens and other similar Liens arising in the ordinary course of
business securing obligations that are not overdue for a period of more than
60 days; provided that provisions for the payment of such Liens has
been made on the books of such Person; (c) pledges or deposits to secure
obligations under workers’ compensation laws or similar legislation or to
secure public or statutory obligations; provided that provisions for the
payment of such Liens has been made on the books of such Person; and (d) Permitted
Real Property Encumbrances.


 


“Permitted
Real Property Encumbrances” means, with respect to any particular Mortgaged
Property, (i) Permitted Liens to the extent relating to such Mortgaged
Property, (ii) those liens, encumbrances and other matters affecting title
to any Mortgaged Property listed in the Mortgage Policies in respect thereof
and as of the date of delivery of such Mortgage Policies to the Administrative
Agent in accordance with the terms hereof, reasonably acceptable to the
Lenders, (iii) such easements, encroachments, covenants, rights of way,
minor defects, irregularities or encumbrances on title which do not arise out
of the incurrence of any Debt and which do not impair the use of such Mortgaged
Property for the purpose for which it is held by the mortgagor thereof, or the
Lien granted to the Administrative Agent for the benefit of the Secured
Parties, and (iv) municipal and zoning ordinances; provided that no
violation exists thereunder that could impair the use of the existing
improvements and the present use made by the mortgagor thereof of the Premises
(as defined in the respective Mortgage).


 


“Person”
means an individual, partnership, corporation (including a business trust),
limited liability company, joint stock company, trust, unincorporated
association, joint venture or other entity, or a government or any political
subdivision or agency thereof.


 


“Plan”
means a Single Employer Plan or a Multiple Employer Plan.


 


“Prepayment
Account” means an account established by the Borrower with the
Administrative Agent and over which the Administrative Agent shall have
exclusive dominion and control, including the exclusive right of withdrawal for
application in accordance with Section 2.6(b)(v), which account
shall be interest bearing, if permitted by law, at rates then currently paid by
Bank of America for deposits of similar amount and duration.  The Borrower hereby grants to the
Administrative Agent for the benefit of the Secured Parties, a security interest
in the Prepayment Account to secure the Obligations.


 


“Prime
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.


 


“Prime
Rate Advance” means an Advance that bears interest as provided in Section 2.7(a)(i).


 


“Pro
Forma Basis” means, for purposes of calculating the financial covenants set
forth in Article VIII (including for purposes of determining the
Applicable Margin), that the Crosstex Acquisition, any Asset Disposition
(subject, in the case of the Carsen Disposition, to the terms of Section 1.3(c) hereof)
and any Permitted Acquisition shall be deemed to have occurred as of the first
day of the most recent four fiscal quarter period preceding the date of such
transaction for which the Borrower was required to deliver financial statements
pursuant to Section 7.2 or 7.3.  In connection with the foregoing, (a) with
respect to any Asset Disposition, (i) income statement and cash flow
statement items (whether positive or negative) attributable to the property
disposed of shall be excluded to the extent relating to any period occurring


 


18





















 


prior to the date of such transaction and (ii) Debt which is
retired shall be excluded and deemed to have been retired as of the first day
of the applicable period and (b) with respect to any Permitted
Acquisition, (i) income statement items attributable to the Person or
property acquired shall be included to the extent relating to any period
applicable in such calculations to the extent (A) such items are not
otherwise included in such income statement items for the Borrower and its
Subsidiaries in accordance with GAAP or in accordance with any defined terms
set forth in Section 1.1 and (B) such items are supported by
financial statements or other information reasonably satisfactory to the
Administrative Agent and (ii) any Debt incurred or assumed by the Borrower
or any Subsidiary (including the Person or property acquired) in connection
with such transaction and any Debt of the Person or property acquired which is
not retired in connection with such transaction (A) shall be deemed to
have been incurred as of the first day of the applicable period and (B) if
such Debt has a floating or formula rate, shall have an implied rate of
interest for the applicable period for purposes of this definition determined
by utilizing the rate which is or would be in effect with respect to such Debt
as at the relevant date of determination.


 


“Pro
Rata Share” of any amount means (a) with respect to any Revolving
Credit Lender at any time, the product of such amount times a fraction the
numerator of which is the amount of such Lender’s Revolving Credit Commitment
at such time and the denominator of which is the Revolving Credit Facility at
such time, (b) with respect to any Term A Lender at any time, the
product of such amount times a fraction the numerator of which is the amount of
such Lender’s Term A Commitment at such time and the denominator of which
is the Term A Facility at such time and (c) with respect to any
Interim Term Lender at any time, the product of such amount times a
fraction the numerator of which is the amount of such Lender’s Interim
Term Commitment at such time and the denominator of which is the Interim
Term Facility at such time.  For purposes
of this definition, the aggregate principal amount of Swing Line Advances owing
to the Swing Line Bank, Letter of Credit Advances owing to the Issuing Bank and
the Available Amount of each Letter of Credit shall be considered to be owed to
the Revolving Lenders ratably in accordance with their respective Revolving
Credit Commitments.


 


“Purchase
Agreements” has the meaning specified in the Preliminary Statements.


 


“Reduction
Amount” has the meaning specified in Section 2.6(b)(v).


 


“Register”
has the meaning specified in Section 11.7(c).


 


“Regulation T”
means Regulation T of the Board of Governors of the Federal Reserve
System, as in effect from time to time.


 


“Regulation U”
means Regulation U of the Board of Governors of the Federal Reserve
System, as in effect from time to time.


 


“Regulation X”
means Regulation X of the Board of Governors of the Federal Reserve
System, as in effect from time to time.


 


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


 


“Release”
means any release, spill, emission, leaking, pumping, pouring, emitting,
emptying, discharging, injecting, escaping, leaching, dumping or disposing into
the environment (including the abandonment or discarding of barrels, containers
and other closed receptacles containing any Hazardous Materials) or into or
from any property, including, without limitation, the movement of any Hazardous
Materials through the air, soil, surface waters or ground water.


 


19





















 


“Remedial”
shall have the meaning as set forth in CERCLA at 42 U.S.C. § 9601(24)
and/or any other applicable Environmental Laws.


 


“Removal”
shall have the meaning as set forth in CERCLA at 42 U.S.C. § 9601(23)
and/or any other applicable Environmental Laws.


 


“Required
Lenders” means at any time Lenders owed or holding greater than 51% of the
sum of (a) the aggregate principal amount of the Advances outstanding at
such time and (b) the aggregate Available Amount of all Letters of Credit
outstanding at such time, or, if no such principal amount and no Letters of
Credit are outstanding at such time, Lenders holding greater than 51% of the
aggregate of the Term A Commitments, Revolving Credit Commitments and
Interim Term Commitments; provided, however, that if any Lender
shall be a Defaulting Lender at such time, there shall be excluded from the
determination of Required Lenders at such time (i) the aggregate principal
amount of the Advances owing to such Lender (in its capacity as a Lender) and
outstanding at such time, and (ii) the aggregate Term A Commitment,
Revolving Credit Commitment and Interim Term Commitment of such Lender at such
time.  For purposes of this definition,
the aggregate principal amount of Swing Line Advances owing to the Swing Line
Bank, Letter of Credit Advances owing to the Issuing Bank and the Available
Amount of each Letter of Credit shall be considered to be owed to the Revolving
Credit Lenders ratably in accordance with their respective Revolving Credit
Commitments.


 


“Response”
shall have the meaning as set forth in CERCLA at 42 U.S.C. § 9601(25)
and/or any other applicable Environmental Laws.


 


“Responsible
Officer” means, with respect to any Loan Party, the chief executive
officer, the president, the chief financial officer, any vice president or the
treasurer of such Loan Party.


 


“Revolving
Credit Advance” has the meaning specified in Section 2.1(b).


 


“Revolving
Credit Availability” means, at any time, the aggregate amount of the
Revolving Credit Facility less the sum of (a) the aggregate principal
amount of all Revolving Credit Advances then outstanding (including the outstanding
balance of Letter of Credit Advances and the aggregate Available Amount of all
Letters of Credit), and (b) Swing Line Advances then outstanding at such
time.


 


“Revolving
Credit Borrowing” means a borrowing consisting of simultaneous Revolving
Credit Advances of the same Type made by the Revolving Credit Lenders.


 


“Revolving
Credit Commitment” means, with respect to any Revolving Credit Lender at
any time, the amount set forth opposite such Lender’s name on Schedule 1
hereto under the caption “Revolving Credit Commitment” or, if such Lender has
entered into one or more Assignments and Acceptances, set forth for such Lender
in the Register maintained by the Administrative Agent pursuant to Section 11.7(c) as
such Lender’s “Revolving Credit Commitment,” as such amount may be reduced at
or prior to such time pursuant to Section 2.5.


 


“Revolving
Credit Facility” means, at any time, the aggregate amount of the Revolving
Credit Lenders’ Revolving Credit Commitments at such time.  The initial amount of the Revolving Credit
Facility in effect on the Closing Date is THIRTY-FIVE MILLION DOLLARS  ($35,000,000).


 


“Revolving
Credit Lender” means any Lender that has a Revolving Credit Commitment.


 


“Revolving
Credit Note” means a promissory note of the Borrower payable to the order
of any Revolving Credit Lender, in substantially the form of Exhibit B
hereto, evidencing the aggregate


 


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indebtedness of the Borrower to such Lender resulting from the
Revolving Credit Advances (including any Letter of Credit Advances and Swing
Line Advances) made by such Lender.


 


“Revolving
Credit Termination Date” means the earlier of (a) August 1, 2010
and (b) the Termination Date.


 


“Secured
Parties” means the Administrative Agent, the Lender Parties, and the Hedge
Banks and the other Persons the Obligations owing to which are or are purported
to be secured by the Collateral under the terms of the Collateral Documents.


 


“Security
Agreement” means the amended and restated security agreement dated as of
the Closing Date executed in favor of the Administrative Agent by each of the
Loan Parties.


 


“Single
Employer Plan” means a single employer plan, as defined in Section 4001(a)(15)
of ERISA, that (a) is maintained for employees of any Loan Party or any
ERISA Affiliate and no Person other than the Loan Parties and the ERISA
Affiliates or (b) was so maintained and in respect of which any Loan Party
or any ERISA Affiliate could have liability under Section 4069 of ERISA in
the event such plan has been or were to be terminated.


 


“Solvent”
and “Solvency” mean, with respect to any Person on a particular date,
that on such date (a) the fair value of the property of such Person is
greater than the total amount of liabilities, including, without limitation,
contingent liabilities, of such Person, (b) 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, (c) such Person does not intend to, and does
not believe that it will, incur debts or liabilities beyond such Person’s
ability to pay such debts and liabilities as they mature and (d) such
Person is not engaged in business or a transaction, and is not about to engage
in business or a transaction, for which such Person’s property would constitute
an unreasonably small capital.  The
amount of contingent liabilities at any time shall be computed as the amount
that, in the 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.


 


“Standby
Letter of Credit” means any Letter of Credit other than a Trade Letter of
Credit.


 


“Stock
Option Plan” means the 1991 Directors Stock Option Plan, as amended, the
1997 Employee Stock Option Plan, as amended and/or the 1998 Directors’ Stock
Option Plan, as amended, each as in effect on the Closing Date and as may be
amended from time to time.


 


“Subsidiary”
of any Person means any corporation, partnership, joint venture, limited
liability company, trust or estate of which (or in which) more than 50% of (a) the
issued and outstanding capital stock having ordinary voting power to elect a
majority of the board of directors of such corporation (irrespective of whether
at the time capital stock of any other class or classes of such corporation
shall or might have voting power upon the occurrence of any contingency), (b) the
interest in the capital or profits of such partnership, joint venture or
limited liability company or (c) the beneficial interest in such trust or
estate, is at the time directly or indirectly owned or controlled by such
Person, by such Person and one or more of its other Subsidiaries or by one or
more of such Person’s other Subsidiaries. 
Unless otherwise specified herein, the term Subsidiary shall mean a
Subsidiary of the Borrower.


 


“Subsidiary
Guaranty” means the amended and restated subsidiary guaranty dated as of
the Closing Date executed by each Domestic Subsidiary of the Borrower.


 


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“Swing
Line Advance” means an advance made by (a) the Swing Line Bank
pursuant to Section 2.1(c) or (b) any Revolving Credit
Lender pursuant to Section 2.2(b).


 


“Swing
Line Bank” has the meaning specified in the recital of parties to this
Agreement.


 


“Swing
Line Borrowing” means a borrowing consisting of a Swing Line Advance made
by the Swing Line Bank.


 


“Swing
Line Facility” has the meaning specified in Section 2.1(c).


 


“Swing
Line Note” means any promissory note of the Borrower payable to the order
of the Swing Line Bank or a Revolving Lender, as the case may be, substantially
in the form attached hereto as Exhibit E, evidencing the
indebtedness of the Borrower to the Swing Line Bank resulting from the Swing
Line Advances made by the Swing Line Bank.


 


“Taxes”
has the meaning specified in Section 2.12(a).


 


“Term A
Advance” has the meaning specified in Section 2.1(a).


 


“Term A
Borrowing” means a borrowing consisting of simultaneous Term A Advances
of the same Type made by the Term A Lenders.


 


“Term A
Commitment” means, with respect to any Term A Lender at any time, the
amount set forth opposite such Lender’s name on Schedule 1 hereto
under the caption “Term A Commitment” or, if such Lender has entered into
one or more Assignments and Acceptances, set forth for such Lender in the
Register maintained by the Administrative Agent pursuant to Section 11.7(c) as
such Lender’s “Term A Commitment.”


 


“Term A
Facility” means, at any time, the aggregate amount of the Term A
Lenders’ Term A Commitments at such time. 
The initial amount of the Term A Facility in effect on the Closing Date
is FORTY MILLION DOLLARS  ($40,000,000).


 


“Term A
Lender” means any Lender that has a Term A Commitment.


 


“Term A
Note” means a promissory note of the Borrower payable to the order of any
Term A Lender, in substantially the form of Exhibit C hereto,
evidencing the indebtedness of the Borrower to such Lender resulting from the
Term A Advance made by such Lender.


 


“Termination
Date” means the date of termination in whole of the Commitments pursuant to
Section 2.5 or Article IX.


 


“Trade
Letter of Credit” means any Letter of Credit that is issued for the benefit
of a supplier of Inventory to the Borrower or any of its Subsidiaries to effect
payment for such Inventory, the conditions to drawing under which include the
presentation to the Issuing Bank of negotiable bills of lading, invoices and
related documents sufficient, in the judgment of the Issuing Bank, to create a
valid and perfected lien on or security interest in such Inventory, bills of
lading, invoices and related documents in favor of the Issuing Bank.


 


“Transaction”
means the transactions contemplated by the Crosstex Acquisition Documents and
the Loan Documents.


 


22





















 


“Treasury
Management Agreement” means any agreement between any Loan Party and any
Lender or Affiliate of a Lender that governs the provision of treasury or cash
management services, including deposit accounts, funds transfer, automated
clearinghouse, zero balance accounts, returned check concentration, controlled
disbursement, lockbox, account reconciliation and reporting and trade finance
services.


 


“Type”
refers to the distinction between Advances bearing interest at the Prime Rate
and Advances bearing interest at the Eurodollar Rate.


 


“Uniform
Commercial Code” means the Uniform Commercial Code as the same may, from
time to time, be enacted and in effect in the State of New York; provided,
that to the extent that the Uniform Commercial Code is used to define any term
herein or in any Loan Document and such term is defined differently in
different Articles or Divisions of the Uniform Commercial Code, the definition
of such term contained in Article or Division 9 shall govern; provided
further, that in the event that, by reason of mandatory provisions of
law, any or all of the attachment, perfection or priority of, or remedies with
respect to, Administrative Agent’s or any Lender’s Lien on any Collateral is
governed by the Uniform Commercial Code as enacted and in effect in a
jurisdiction other than the State of New York, the term “Uniform
Commercial Code” shall mean the Uniform Commercial Code as enacted and in
effect in such other jurisdiction solely for purposes of the provisions thereof
relating to such attachment, perfection, priority or remedies and for purposes
of definitions related to such provisions.


 


“United
States” and “U.S.” mean the United States of America.


 


“Unused
Revolving Credit Commitment” means, with respect to any Revolving Credit
Lender, at any time, (a) such Lender’s Revolving Credit Commitment at such
time minus (b) the sum of (i) the aggregate principal amount
of all Revolving Credit Advances and Letter of Credit Advances made by such
Lender (in its capacity as a Lender) and outstanding at such time, plus (ii) such
Lender’s Pro Rata Share of (A) the aggregate Available Amount of all
Letters of Credit outstanding at such time and (B) the aggregate principal
amount of all Letter of Credit Advances made by the Issuing Bank pursuant to Section 2.3(c) and
outstanding at such time.


 


“Voting
Stock” means capital stock issued by a corporation, or equivalent interests
in any other Person, the holders of which are ordinarily, in the absence of
contingencies, entitled to vote for the election of directors (or persons
performing similar functions) of such Person, even if the right so to vote has
been suspended by the happening of such a contingency.


 


“Welfare
Plan” means a welfare plan, as defined in Section 3(1) of ERISA,
that is maintained for employees of any Loan Party or in respect of which any
Loan Party could have liability.


 


“Wholly
Owned Domestic Subsidiary” of any Person means a Domestic Subsidiary of
such Person and of which securities (except for directors’ or other qualifying
shares) or other ownership interests representing 100% of the equity or 100% of
the ordinary voting power or 100% of the general partnership interests are, at
the time any determination is being made, owned, controlled or held by such
Person or one or more wholly owned Subsidiaries of such Person or by such
Person and one or more wholly owned Subsidiaries of such Person.


 


“Wholly
Owned Subsidiary” of any Person means a Subsidiary of such Person of which
securities (except for directors’ or other qualifying shares) or other
ownership interests representing 100% of the equity or 100% of the ordinary
voting power or 100% of the general partnership interests are, at the time any
determination is being made, owned, controlled or held by such Person or one or
more wholly owned


 


23





















 


Subsidiaries of such Person or
by such Person and one or more wholly owned Subsidiaries of such Person.


 


“Withdrawal
Liabilities” has the meaning specified in Part I of Subtitle E of
Title IV of ERISA.


 


Section 1.2            Computation
of Time Periods.


 


In
this Agreement in the computation of periods of time from a specified date to a
later specified date, the word “from” means “from and including” and the words “to”
and “until” each mean “to but excluding.”


 


Section 1.3            Accounting
Terms.


 


(a)           Generally.  Except as otherwise specifically prescribed
herein, all accounting terms not specifically or completely defined herein
shall be construed in conformity with, and all financial data (including
financial ratios and other financial calculations) required to be submitted
pursuant to this Agreement shall be prepared in conformity with, GAAP applied
on a consistent basis, as in effect from time to time, applied in a manner
consistent with that used in preparing the audited financial statements of the
Borrower for the Fiscal Year  ended on July 31,
2004.


 


(b)           Changes
in GAAP.  The Borrower will provide a
written summary of material changes in GAAP and in the consistent application
thereof with each annual and quarterly certificate delivered in accordance with
Section 7.2 or 7.3, as applicable.  If at any time any change in GAAP would
affect the computation of any financial ratio or requirement set forth in any
Loan Document, and either the Borrower or the Required Lenders shall so
request, the Administrative Agent, the Lenders and the Borrower shall negotiate
in good faith to amend such ratio or requirement to preserve the original
intent thereof in light of such change in GAAP (subject to the approval of the
Required Lenders); provided  that, until so amended, (i) such
ratio or requirement shall continue to be computed in accordance with GAAP
prior to such change therein and (ii) the Borrower shall provide to the
Administrative Agent and the Lenders financial statements and other documents
required under this Agreement or as reasonably requested hereunder setting
forth a reconciliation between calculations of such ratio or requirement made
before and after giving effect to such change in GAAP.


 


(c)           Calculations.  Notwithstanding the above, the parties hereto
acknowledge and agree that all calculations of the financial covenants in Article VIII
(including for purposes of determining the Applicable Margin) shall be made on
a Pro Forma Basis.  In addition,
commencing with the fiscal quarter of the Borrower ending July 31, 2006,
the winding-down of certain of Carsen’s operations as a result of the
cancellation of distribution agreements with Olympus America Inc. and Olympus
Surgical & Industrial America Inc. shall be treated as an Asset
Disposition for purposes of the definition of “Pro Forma Basis.”


 


Section 1.4            Construction.


 


All
undefined terms contained in any of the Loan Documents shall, unless the
context indicates otherwise, have the meanings provided for by the Uniform Commercial
Code to the extent the same are used or defined therein; in the event that any
term is defined differently in different Articles or Divisions of the
Uniform Commercial Code, the definition contained in Article or
Division 9 shall control.  Unless
otherwise specified, references in the Agreement or any of the appendices to a
Section, subsection or clause refer to such Section, subsection or
clause as contained in the Agreement. 
Any definition of or reference to any Loan Document shall be construed
as referring to such agreement or other document as from time to time amended,
supplemented or otherwise modified.  The
words “herein,” “hereof” and


 


24





















 


“hereunder” and other words of
similar import refer to the Agreement as a whole, including all Exhibits and
Schedules, as the same may from time to time be amended, restated, modified or
supplemented, and not to any particular section, subsection or clause
contained in the Agreement or any such Exhibit or Schedule.  Wherever from the context it appears
appropriate, each term stated in either the singular or plural shall include
the singular and the plural, and pronouns stated in the masculine, feminine or
neuter gender shall include the masculine, feminine and neuter genders.  The words “including”, “includes” and “include”
shall be deemed to be followed by the words “without limitation”; the word “or”
is not exclusive; references to Persons include their respective successors and
assigns (to the extent and only to the extent permitted by the Loan Documents)
or, in the case of governmental Persons, Persons succeeding to the relevant
functions of such Persons; and all references to statutes and related
regulations shall include any amendments of the same and any successor statutes
and regulations.  Whenever any provision
in any Loan Document refers to the knowledge (or an analogous phrase) of any
Loan Party, such words are intended to signify that such Loan Party has actual
knowledge or awareness of a particular fact or circumstance.


 


Section 1.5            Letter
of Credit Amounts.


 


Unless
otherwise specified herein, the amount of a Letter of Credit at any time shall
be deemed to be the Available Amount of such Letter of Credit in effect at such
time; provided, however, that with respect to any Letter of
Credit that, by its terms or the terms of any Issuer Document related thereto,
provides for one or more automatic increases in the stated amount thereof, the
amount of such Letter of Credit shall be deemed to be the maximum stated amount
of such Letter of Credit after giving effect to all such increases, whether or
not such maximum stated amount is in effect at such time.


 


ARTICLE II


 


AMOUNTS AND TERMS OF THE

ADVANCES AND THE LETTERS OF CREDIT


 


Section 2.1            The
Advances.


 


(a)           The
Term A Advances.  Each
Term A Lender severally agrees, on the terms and conditions hereinafter
set forth, to make a single advance (a “Term A Advance”) to the
Borrower on the Closing Date in an amount not to exceed such Lender’s
Term A Commitment at such time.  The
Term A Borrowing shall consist of Term A Advances made simultaneously
by the Term A Lenders ratably according to their Term A
Commitments.  Amounts borrowed under this
Section 2.1(a) and repaid or prepaid may not be reborrowed.


 


(b)           The
Revolving Credit Advances.  Each
Revolving Credit Lender severally agrees, on the terms and conditions
hereinafter set forth, to make advances (each a “Revolving Credit Advance”)
to the Borrower from time to time on any Business Day during the period from
the Closing Date until the Revolving Credit Termination Date in an amount for
each such Advance not to exceed such Lender’s Revolving Credit Commitment at
such time; provided, however, that no Revolving Credit Lender
shall have any obligation to make a Revolving Credit Advance under this Section 2.1(b) to
the extent such Revolving Credit Advance would (after giving effect to any
immediate application of the proceeds thereof) exceed the Revolving Credit
Availability at such time.  Each
Revolving Credit Borrowing shall be in an aggregate amount of $500,000 or an
integral multiple of $100,000 (other than, in each case, a Borrowing the
proceeds of which shall be used solely to repay or prepay in full outstanding
Swing Line Advances or outstanding Letter of Credit Advances) and shall consist
of Revolving Credit Advances


 


25





















 


made simultaneously by the
Revolving Credit Lenders ratably according to their Revolving Credit
Commitments.  Within the limits of each
Revolving Credit Lender’s Revolving Credit Commitment in effect from time to
time, the Borrower may borrow, repay and reborrow Revolving Credit Advances.


 


(c)           The
Swing Line Advances.  The Borrower
may request the Swing Line Bank to make, and the Swing Line Bank may, if in its
discretion it elects to do so, make, on the terms and conditions hereinafter
set forth and in reliance upon the agreements of the other Lenders set forth in
this Agreement, Swing Line Advances to the Borrower from time to time on any
Business Day during the period from the Closing Date until the Revolving Credit
Termination Date in an aggregate amount not to exceed at any time outstanding
the lesser of (i) $2,000,000 (the “Swing Line Facility”) and (ii) (after
giving effect to any immediate application of the proceeds thereof) the
Revolving Credit Availability at such time. 
No Swing Line Advance shall be used for the purpose of funding the
payment of principal of any other Swing Line Advance.  Each Swing Line Borrowing shall be made as a
Prime Rate Advance and shall be in an aggregate amount of not less than
$100,000.  Within the limits of the Swing
Line Facility and within the limits referred to in clause (ii) above,
so long as the Swing Line Bank, in its discretion, elects to make Swing Line
Advances, the Borrower may borrow and reborrow under this Section 2.1(c) and
may repay or prepay the Swing Line Advances at such times prior to the
Termination Date, and in such integral multiples, as the Borrower may elect.


 


(d)           Letters
of Credit.  The Issuing Bank agrees,
on the terms and conditions hereinafter set forth and in reliance upon the
agreements of the other Lenders set forth in this Agreement, to issue letters
of credit for the account of the Borrower from time to time on any Business Day
during the period from the Closing Date until sixty (60) days before the
Revolving Credit Termination Date in an aggregate Available Amount for all
Letters of Credit not to exceed at any time the Letter of Credit Commitment at
such time.  No Letter of Credit shall
have an expiration date (including all rights of the Borrower or the
beneficiary to require renewal) later than the earlier of (A) sixty (60)
days before the Revolving Credit Termination Date, (B) in the case of a
Standby Letter of Credit, 365 days after the date of issuance thereof and (C) in
the case of a Trade Letter of Credit, 180 days after the date of issuance
thereof.  If the Borrower so requests in
any applicable Letter of Credit Application, the Issuing Bank may, in its sole
and absolute discretion, agree to issue a Letter of Credit that has automatic
extension provisions (each, an “Auto-Extension Letter of Credit”); provided
that any such Auto-Extension Letter of Credit must permit the Issuing Bank to
prevent any such extension at least once in each twelve-month period
(commencing with the date of issuance of such Letter of Credit) by giving prior
notice to the beneficiary thereof not later than a day (the “Non-Extension
Notice Date”) in each such twelve-month period to be agreed upon at the
time such Letter of Credit is issued. 
Unless otherwise directed by the Issuing Bank, the Borrower shall not be
required to make a specific request to the Issuing Bank for any such extension.  Once an Auto-Extension Letter of Credit has
been issued, the Lenders shall be deemed to have authorized (but may not
require) the Issuing Bank to permit the extension of such Letter of Credit at
any time to an expiration date that is not later than permitted pursuant to the
immediately preceding sentence; provided, however, that the
Issuing Bank shall not permit any such extension if (i) the Issuing Bank
has determined that it would not be permitted, or would have no obligation, at
such time to issue such Letter of Credit in its revised form (as extended)
under the terms hereof, or (ii) it has received notice (which may be by
telephone or in writing) on or before the day that is five Business Days before
the Non-Extension Notice Date (A) from the Administrative Agent that the
Required Lenders have elected not to permit such extension or (B) from the
Administrative Agent, any Lender or the Borrower that one or more of the
applicable conditions specified in Section 3.2 is not then
satisfied, and in each case directing the Issuing Bank not to permit such
extension.  Within the limits of the
Letter of Credit Commitment, and subject to the limits referred to above, the
Borrower may request the issuance of Letters of Credit under this Section 2.1(d),
repay any Letter of Credit Advances resulting from drawings under Letters of
Credit pursuant to Section 2.3(c) and request the issuance of
additional Letters of Credit under this Section 2.1(d).


 


26





















 


(e)           The
Interim Term Advances.  Each
Interim Term Lender severally agrees, on the terms and conditions
hereinafter set forth, to make a single advance (a “Interim
Term Advance”) to the Borrower on the Closing Date in an amount not to
exceed such Lender’s Interim Term Commitment at such time.  The Interim Term Borrowing shall consist
of Interim Term Advances made simultaneously by the Interim
Term Lenders ratably according to their Interim
Term Commitments.  Amounts borrowed
under this Section 2.1(e) and repaid or prepaid may not be
reborrowed.


 


Section 2.2            Making
the Advances.


 


(a)           Except
as otherwise provided in Section 2.3 or, with respect to Swing Line
Advances, in Section 2.2(b), each Borrowing shall be made on notice, given
not later than 11:00 a.m. (New York time) on the third Business Day
prior to the date of the proposed Borrowing in the case of Eurodollar Rate
Advances and on the first Business Day prior to the date of the proposed
Borrowing in the case of Prime Rate Advances by the Borrower to the
Administrative Agent, which shall give to each appropriate Lender prompt notice
thereof by telex or telecopier.  Each
such notice of a Borrowing (a “Notice of Borrowing”) may be by
telephone, confirmed immediately in writing, or telex or telecopier in
substantially the form of Exhibit F hereto, specifying therein the
requested (i) date of such Borrowing, (ii) Facility under which such
Borrowing is to be made, (iii) Type of Advances comprising such Borrowing,
(iv) aggregate amount of such Borrowing and (v) in the case of a
Borrowing consisting of Eurodollar Rate Advances, initial Interest Period for
each such Advance.  Each appropriate
Lender shall, before 11:00 a.m. (New York time) on the date of such
Borrowing, make available for the account of its Applicable Lending Office to
the Administrative Agent at the Administrative Agent’s Account, in same day
funds, such Lender’s ratable portion of such Borrowing in accordance with the
respective Commitments under the applicable Facility of such Lender and the
other appropriate Lenders.  After the
Administrative Agent’s receipt of such funds and upon fulfillment of the
applicable conditions set forth in Article III, the Administrative
Agent will make such funds available to the Borrower by crediting the Borrower’s
Account; provided, however, that in the case of any Revolving
Credit Borrowing, the Administrative Agent shall first make a portion of such
funds equal to the aggregate principal amount of any Swing Line Advances and
Letter of Credit Advances made by the Swing Line Bank, the Issuing Bank and by
any other Revolving Credit Lender and outstanding on the date of such Revolving
Credit Borrowing, plus interest accrued and unpaid thereon to and as of
such date, available to the Swing Line Bank, the Issuing Bank and such other
Revolving Credit Lenders for repayment of such Swing Line Advances and Letter
of Credit Advances.


 


(b)           Each
Swing Line Borrowing shall be made either (x) on notice, given not later
than 11:00 a.m. (New York time) on the date of the proposed Swing
Line Borrowing, by the Borrower to the Swing Line Bank and the Administrative
Agent or (y) pursuant to other arrangements, including, by way of example
and not of limitation, arrangements for daily repayments and borrowings on each
Business Day, which are satisfactory in form and substance to the Swing Line
Bank, the Administrative Agent and the Borrower.  Each notice of a Swing Line Borrowing
pursuant to clause (x) in the immediately preceding sentence (a “Notice
of Swing Line Borrowing”) shall be by telephone, confirmed immediately in
writing, or telex or telecopier, specifying therein the requested (i) date
of such Borrowing, (ii) amount of such Borrowing and (iii) maturity
of such Borrowing (which maturity shall be no later than the tenth day after
the requested date of such Borrowing). 
If, in its discretion, it elects to make a requested Swing Line Advance,
the Swing Line Bank will make the amount thereof available to the
Administrative Agent at the Administrative Agent’s Account, in same day
funds.  After the Administrative Agent’s
receipt of such funds and upon fulfillment of the applicable conditions set
forth in Article III, the Administrative Agent will make such funds
available to the Borrower by crediting the Borrower’s Account.  Upon written demand by the Swing Line Bank,
with a copy of such demand to the Administrative Agent, each other Revolving
Credit Lender shall purchase from the Swing Line Bank, and the Swing Line Bank
shall sell and assign to each such other Revolving Credit Lender, such other
Lender’s Pro Rata Share of all


 


27





















 


outstanding Swing Line Advances
as of the date of such demand, by deposit to the Administrative Agent’s
Account, in same day funds, an amount equal to the portion of the outstanding
principal amount of Swing Line Advances to be purchased by such Lender.  The Borrower hereby agrees to each such sale
and assignment.  Each Revolving Credit
Lender agrees to purchase its Pro Rata Share of outstanding Swing Line Advances
on (i) the Business Day on which demand therefor is made by the Swing Line
Bank; provided that notice of such demand is given not later than 3:00 p.m.
(New York time) on such Business Day, or (ii) the first Business Day
next succeeding such demand if notice of such demand is given after such
time.  Upon any such assignment by the
Swing Line Bank to any other Revolving Credit Lender of a portion of a Swing
Line Advance, the Swing Line Bank represents and warrants to such other Lender
that the Swing Line Bank is the legal and beneficial owner of such interest
being assigned by it, but makes no other representation or warranty and assumes
no responsibility with respect to such Swing Line Advance, the Loan Documents
or any Loan Party.  If and to the extent
that any Revolving Credit Lender shall not have so made the amount of such
Swing Line Advance available to the Administrative Agent, such Revolving Credit
Lender agrees to pay to the Administrative Agent, for the account of the Swing
Line Bank, forthwith on demand such amount together with interest thereon, for
each day from the date of demand by the Swing Line Bank until the date such
amount is paid to the Administrative Agent, at the Federal Funds Rate.  If such Lender shall pay to the
Administrative Agent such amount for the account of the Swing Line Bank on any
Business Day, such amount so paid in respect of principal shall constitute a
Swing Line Advance made by such Lender on such Business Day for purposes of
this Agreement, and the outstanding principal amount of the Swing Line Advance
made by the Swing Line Bank shall be reduced by such amount on such Business
Day.


 


(c)           Anything
in subsection (a) above to the contrary notwithstanding, (i) the
Borrower may not select Eurodollar Rate Advances if the obligation of the
appropriate Lenders to make Eurodollar Rate Advances shall then be suspended
pursuant to Section 2.9 or Section 2.10, and (ii) the
Eurodollar Rate Advances made on any date may not be outstanding as part of
more than fifteen (15) separate Borrowings.


 


(d)           Each
Notice of Borrowing and Notice of Swing Line Borrowing shall be irrevocable and
binding on the Borrower.  In the case of
any Borrowing that the related Notice of Borrowing specifies is to be comprised
of Eurodollar Rate Advances, the Borrower shall indemnify each appropriate
Lender against any loss, cost or expense incurred by such Lender as a result of
any failure by the Borrower to fulfill on or before the date specified in such
Notice of Borrowing for such Borrowing the applicable conditions set forth in Article III,
including, without limitation, any loss (including loss of anticipated profits
as reasonably determined by such Lender), cost or expense incurred by reason of
the liquidation or redeployment of deposits or other funds acquired by such
Lender to fund the Advance to be made by such Lender as part of such Borrowing
when such Advance, as a result of such failure, is not made on such date.


 


(e)           Unless
the Administrative Agent shall have received notice from a Lender prior to the
proposed date of any Borrowing that such Lender will not make available to the
Administrative Agent such Lender’s share of such Borrowing, the Administrative
Agent may assume that such Lender has made such share available on such date in
accordance with subsection (a) or (b) of this Section 2.2
and may, in reliance upon such assumption, make available to the Borrower a
corresponding amount.  In such event, if
a Lender has not in fact made its share of the applicable Borrowing available
to the Administrative Agent, then the applicable Lender and the Borrower
severally agree to pay to the Administrative Agent forthwith on demand such
corresponding amount in immediately available funds with interest thereon, for
each day from and including the date such amount is made available to the
Borrower to but excluding the date of payment to the Administrative Agent, at (A) in
the case of a payment to be made by such Lender, the greater of the Federal
Funds Rate and a rate determined by the Administrative Agent in accordance with
banking industry rules on interbank compensation and (B) in the case
of a payment to be made by the


 


28





















 


Borrower, the interest rate
applicable to Prime Rate Advances.  If
the Borrower and such Lender shall pay such interest to the Administrative
Agent for the same or an overlapping period, the Administrative Agent shall
promptly remit to the Borrower the amount of such interest paid by the Borrower
for such period.  If such Lender pays its
share of the applicable Borrowing to the Administrative Agent, then the amount
so paid shall constitute such Lender’s Advance included in such Borrowing.  Any payment by the Borrower shall be without
prejudice to any claim the Borrower may have against a Lender that shall have
failed to make such payment to the Administrative Agent.  A notice of the Administrative Agent to any
Lender or the Borrower with respect to any amount owing under this subsection (e) shall
be conclusive, absent manifest error.


 


(f)            The
obligations of the Lenders hereunder to make Advances, to fund participations
in Letters of Credit and Swing Line Advances and to make payments pursuant to Section 11.4(c) are
several and not joint.  The failure of
any Lender to make any Advance, to fund any such participation or to make any
payment under Section 11.4(c) 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 Advance, to purchase its participation or to make its
payment under Section 11.4(c).


 


Section 2.3                                   Issuance of and Drawings and Reimbursement Under Letters of Credit.


 


(a)           Request
for Issuance.  Each Letter of Credit
shall be issued or amended upon notice (in the form of a Letter of Credit
Application) given not later than 11:00 a.m. (New York time) on the
fifth Business Day prior to the date of the proposed issuance or amendment of
such Letter of Credit by the Borrower to the Issuing Bank (with a copy to the
Administrative Agent).  Each request for
the issuance of a Letter of Credit shall be in writing and shall specify
therein (i) the proposed date of such issuance (which shall be a Business
Day), (ii) the Available Amount of such Letter of Credit, (iii) the
expiration date of such Letter of Credit, (iv) the name and address of the
beneficiary of such Letter of Credit, (v) the documents to be presented by
such beneficiary in case of any drawing thereunder; (vi) the full text of
any certificate to be presented by such beneficiary in case of any drawing
thereunder; and (vii) such other matters as the Issuing Bank may
require.  Each request for an amendment
of any outstanding Letter of Credit shall be in writing and shall specify
therein (i) the Letter of Credit to be amended; (ii) the proposed
date of amendment thereof (which shall be a Business Day); (iii) the
nature of the proposed amendment; and (iv) such other matters as the
Issuing Bank may require.  Unless the
Issuing Bank has received written notice from any Lender, the Administrative
Agent or any Loan Party, at least one Business Day prior to the requested date
of issuance or amendment of the applicable Letter of Credit, that one or more
applicable conditions contained in Article III shall not be
satisfied, then, subject to the terms and conditions hereof, the Issuing Bank
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 Bank’s usual and customary business
practices; provided, however, the Issuing Bank shall not be under
any obligation to issue any Letter of Credit if (i) any order, judgment or
decree of any governmental authority or arbitrator shall by its terms purport
to enjoin or restrain the Issuing Bank from issuing such Letter of Credit, or
any law applicable to the Issuing Bank or any request or directive (whether or
not having the force of law) from any governmental authority with jurisdiction
over the Issuing Bank shall prohibit, or request that the Issuing Bank refrain
from, the issuance of letters of credit generally or such Letter of Credit in
particular or shall impose upon the Issuing Bank with respect to such Letter of
Credit any restriction, reserve or capital requirement (for which the Issuing
Bank is not otherwise compensated hereunder) not in effect on the Closing Date,
or shall impose upon the Issuing Bank any unreimbursed loss, cost or expense
which was not applicable on the Closing Date and which the Issuing Bank in good
faith deems material to it, (ii) the issuance of such Letter of Credit
would violate one or more generally applicable policies of the Issuing Bank or (iii) a
default of any Lender’s obligations to fund under Section 2.3(c) exists
or any Lender is at such time a Defaulting Lender hereunder, unless


 


29





















 


the Issuing Bank has entered
into satisfactory arrangements with the Borrower or such Defaulting Lender to
eliminate the Issuing Bank’s risk with respect to such Defaulting Lender.  In the event and to the extent that the provisions
of any such Letter of Credit Application shall conflict with this Agreement,
the provisions of this Agreement shall govern. 
Immediately upon the issuance of each Letter of Credit, each Revolving
Credit Lender shall be deemed to, and hereby irrevocably and unconditionally
agrees to, purchase from the Issuing Bank a risk participation in such Letter
of Credit in an amount equal to the product of such Revolving Credit Lender’s
Pro Rata Share times the Available Amount of such Letter of Credit.


 


(b)           Copies of Letters of Credit.  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
Bank will also deliver to the Borrower and the Administrative Agent a true and
complete copy of such Letter of Credit or amendment.  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 Bank.  The Borrower shall be conclusively deemed to
have waived any such claim against the Issuing Bank and its correspondents unless
such notice is given as aforesaid.


 


(c)           Drawing
and Reimbursement.  The payment by
the Issuing Bank of a draft drawn under any Letter of Credit shall constitute
for all purposes of this Agreement the making by the Issuing Bank of a Letter
of Credit Advance which shall be a Prime Rate Advance in the amount of such
draft.  The Borrower, the Administrative
Agent and each Revolving Credit Lender hereby acknowledge and agree that Letter
of Credit Advances may be made, or deemed made, by the Issuing Bank in respect
of any Letter of Credit and to participate in all Letter of Credit Advances
made hereunder as provided herein.  Upon
written notice by the Issuing Bank or the Administrative Agent (which notice
may be given by telephone if immediately confirmed in writing), each Revolving
Credit Lender shall purchase from the Issuing Bank, and the Issuing Bank shall
sell and assign to each such Revolving Credit Lender such Lender’s Pro Rata
Share of such outstanding Letter of Credit Advance as of the date of such
purchase, by making available (for the account of its Applicable Lending
Office) to the Administrative Agent (for the account of the Issuing Bank), by
deposit to the Administrative Agent’s Account, in same day funds in Dollars, an
amount equal to the portion of the outstanding principal amount of such Letter
of Credit Advance to be purchased by such Lender.  Promptly after receipt thereof, the
Administrative Agent shall transfer such funds to the Issuing Bank.  The Borrower hereby agrees to each such sale
and assignment.  Each Revolving Credit
Lender agrees to purchase its Pro Rata Share of an outstanding Letter of Credit
Advance on (i) the Business Day on which demand therefor is made by the
Issuing Bank or the Administrative Agent; provided that notice of such
demand is given not later than 1:00 p.m. (New York time) on such
Business Day or (ii) the first Business Day next succeeding such demand if
notice of such demand is given after such time. 
Upon any such assignment by the Issuing Bank to any other Revolving
Credit Lender of a portion of a Letter of Credit Advance the Issuing Bank
represents and warrants to such other Lender that the Issuing Bank is the legal
and beneficial owner of such interest being assigned by it, free and clear of
any liens, but makes no other representation or warranty and assumes no
responsibility with respect to such Letter of Credit Advance, the Loan
Documents or any Loan Party.  If and to
the extent that any Revolving Credit Lender shall not have so made the amount
of such Letter of Credit Advance available to the Administrative Agent, such
Revolving Credit Lender agrees to pay to the Administrative Agent forthwith on
demand such amount together with interest thereon, for each day from the date
of demand by the Issuing Bank or the Administrative Agent until the date such
amount is paid to the Administrative Agent, at the Federal Funds Rate for its
account or the account of the Issuing Bank, as applicable.  If such Lender shall pay to the
Administrative Agent such amount for the account of the Issuing Bank on any Business
Day, such amount so paid in respect of principal shall constitute a Letter of
Credit Advance made by such Lender on such Business Day for purposes of this
Agreement, and the outstanding principal amount of the Letter of Credit Advance
made by the Issuing Bank shall be reduced


 


30





















 


by such amount on such Business
Day.  Each Revolving Credit Lender’s
obligation to make Letter of Credit Advances to reimburse the Issuing Bank for
amounts drawn under Letters of Credit, as contemplated by this Section 2.3(c),
shall be absolute and unconditional and shall not be affected by any
circumstance, including (A) any setoff, counterclaim, recoupment, defense
or other right which such Revolving Credit Lender may have against the Issuing
Bank, the Borrower or any other Person for any reason whatsoever; (B) the
occurrence or continuance of a Default, or (C) any other occurrence, event
or condition, whether or not similar to any of the foregoing.  No such making of a Letter of Credit Advance
shall relieve or otherwise impair the obligation of the Borrower to reimburse
the Issuing Bank for the amount of any payment made by the Issuing Bank under
any Letter of Credit, together with interest as provided herein.


 


(d)           Failure
to Make Letter of Credit Advances. 
The failure of any Lender to make any Letter of Credit Advance to be
made by it on the date specified in Section 2.3(c) shall not
relieve any other Lender of its obligation hereunder to make its Letter of
Credit Advance on such date, but no Lender shall be responsible for the failure
of any other Lender to make the Letter of Credit Advance to be made by such
other Lender on such date.


 


(e)           Applicability
of ISP and UCP.  Unless otherwise
expressly agreed by the Issuing Bank and the Borrower when a Letter of Credit
is issued, (i) the rules of the “International Standby Practices 1998”
published by the Institute of International Banking Law & Practice
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.


 


Section 2.4            Repayment
of Advances.


 


(a)           Term A
Advances.  The Borrower shall repay
to the Administrative Agent for the ratable account of the Term A Lenders
the aggregate outstanding principal amount of the Term A Advance on the
following dates in the amounts indicated (which amounts shall be reduced as a result
of the application of prepayments in accordance with the order of priority set
forth in Section 2.6):


 


	
  Date

  	
   

  	
  Amount

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  September 30, 2005

  	
   

  	
  $

  	
  500,000

  	
   

  
	
  December 31, 2005

  	
   

  	
  $

  	
  500,000

  	
   

  
	
  March 31, 2006

  	
   

  	
  $

  	
  500,000

  	
   

  
	
  June 30, 2006

  	
   

  	
  $

  	
  500,000

  	
   

  
	
  September 30, 2006

  	
   

  	
  $

  	
  1,000,000

  	
   

  
	
  December 31, 2006

  	
   

  	
  $

  	
  1,000,000

  	
   

  
	
  March 31, 2007

  	
   

  	
  $

  	
  1,000,000

  	
   

  
	
  June 30, 2007

  	
   

  	
  $

  	
  1,000,000

  	
   

  
	
  September 30, 2007

  	
   

  	
  $

  	
  1,500,000

  	
   

  
	
  December 31, 2007

  	
   

  	
  $

  	
  1,500,000

  	
   

  
	
  March 31, 2008

  	
   

  	
  $

  	
  1,500,000

  	
   

  
	
  June 30, 2008

  	
   

  	
  $

  	
  1,500,000

  	
   

  
	
  September 30, 2008

  	
   

  	
  $

  	
  2,000,000

  	
   

  
	
  December 31, 2008

  	
   

  	
  $

  	
  2,000,000

  	
   

  
	
  March 31, 2009

  	
   

  	
  $

  	
  2,000,000

  	
   

  
	
  June 30, 2009

  	
   

  	
  $

  	
  2,000,000

  	
   

  
	
  September 30, 2009

  	
   

  	
  $

  	
  2,500,000

  	
   

  
	
  December 31, 2009

  	
   

  	
  $

  	
  2,500,000

  	
   

  
	
  March 31, 2010

  	
   

  	
  $

  	
  2,500,000

  	
   

  
	
  June 30, 2010

  	
   

  	
  $

  	
  2,500,000

  	
   

  
	
  September 30, 2010

  	
   

  	
  $

  	
  2,500,000

  	
   

  
	
  December 31, 2010

  	
   

  	
  $

  	
  2,500,000

  	
   

  
	
  March 31, 2011

  	
   

  	
  $

  	
  2,500,000

  	
   

  
	
  June 30, 2011

  	
   

  	
  All remaining

  outstanding principal

  	
   

  



 


31





















 


provided, however,
that the final principal installment shall be in an amount equal to the
aggregate principal amount of the Term A Advances outstanding on such
date.


 


(b)           Interim Term Advances.  The Borrower shall repay to the
Administrative Agent for the ratable account of the Interim Term Lenders on or
before October 31, 2005 the aggregate outstanding principal amount of the
Interim Term Advance.


 


(c)           Revolving
Credit Advances.  The Borrower shall
repay to the Administrative Agent for the ratable account of the Revolving
Credit Lenders on the Revolving Credit Termination Date the aggregate principal
amount of the Revolving Credit Advances then outstanding.


 


(d)           Swing
Line Advances.  The Borrower shall
repay to the Administrative Agent for the account of the Swing Line Bank and
each other Revolving Credit Lender that has made a Swing Line Advance the
outstanding principal amount of each Swing Line Advance made by each of them on
the earlier of the maturity date for such Swing Line Advance (which maturity
date shall be no later than the tenth day after the requested date of such
Swing Line Advance) and the Revolving Credit Termination Date.


 


(e)           Letter
of Credit Advances.


 


(i)            The Borrower shall repay to the
Administrative Agent for the account of the Issuing Bank and each other
Revolving Credit Lender that has made a Letter of Credit Advance on the earlier
of demand or the Revolving Credit Termination Date the outstanding principal
amount of each Letter of Credit Advance made by each of them.


 


(ii)           The Obligations of the Borrower under
this Agreement, any Letter of Credit Application or any other Issuer Document
shall be unconditional and irrevocable, and shall be paid strictly in
accordance with the terms of this Agreement, such Letter of Credit Application
or such other Issuer Document under all circumstances, including, without
limitation, the following circumstances:


 


(A)          any lack of validity or enforceability
of any Loan Document, any Letter of Credit Application, any Letter of Credit or
any other Issuer Documents;


 


(B)           any payment by the Issuing Bank under
such Letter of Credit against presentation of a draft or certificate that does
not strictly comply with the terms of such


 


32





















 


Letter
of Credit; or any payment made by the Issuing Bank 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
the Federal Bankruptcy Code;


 


(C)           the existence of any claim, set-off,
defense or other right that the Borrower may have at any time against any
beneficiary or any transferee of a Letter of Credit (or any Persons for whom
any such beneficiary or any such transferee may be acting), the Issuing Bank,
or any other Person, whether in connection with the transactions contemplated
by the Issuer Documents or any unrelated transaction;


 


(D)          any statement or any other document
presented under a Letter of Credit proving to be forged, fraudulent, invalid or
insufficient in any respect or any statement therein being untrue or inaccurate
in any respect; or


 


(E)           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 or any Subsidiary.


 


Notwithstanding anything in clauses (A) through
(E) of Section 2.4(e)(ii) to the contrary, the Borrower
may have a claim against the Issuing Bank, and the Issuing Bank 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 Bank’s willful misconduct or
gross negligence or the Issuing Bank’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 unless the Issuing Bank is prevented or prohibited from so paying as a
result of any order or directive of any court or other governmental authority.


 


Section 2.5            Termination or Reduction of the
Commitments.


 


(a)           Optional.  The Borrower may, upon at least three
Business Days’ notice to the Administrative Agent, terminate in whole or reduce
in part the unused portion of the Unused Revolving Credit Commitments; provided,
however, that each partial reduction of the Revolving Credit Facility (i) shall
be in an aggregate amount of $1,000,000 or an integral multiple of $500,000 in
excess thereof, and (ii) shall be made ratably among the appropriate
Lenders in accordance with their Commitments with respect to such Facility.


 


(b)           Mandatory.


 


(i)            On and after the date that all
Term A Advances shall have been repaid in full, the Revolving Credit
Facility shall be automatically and permanently reduced on each date on which
prepayment thereof is required to be made pursuant to Section 2.6(b)(i),
(ii), (iii) or (iv) in an amount equal to
the applicable Reduction Amount, provided that each such reduction of
the Revolving Credit Facility shall be made ratably among the Revolving Credit
Lenders in accordance with their Revolving Credit Commitments.


 


(ii)           The Letter of Credit Commitment shall
be permanently reduced from time to time on the date of each reduction in the
Revolving Credit Facility by the amount, if any, by


 


33





















 


which
the amount of the Letter of Credit Commitment exceeds the Revolving Credit
Facility after giving effect to such reduction of the Revolving Credit
Facility.


 


Section 2.6            Prepayments.


 


(a)           Optional.  The Borrower may, upon at least one (1) Business
Day’s notice in the case of Prime Rate Advances and three (3) Business
Days’ notice in the case of Eurodollar Rate Advances, in each case to the
Administrative Agent stating the proposed date and aggregate principal amount
of the prepayment, and if such notice is given, the Borrower shall, prepay the
outstanding aggregate principal amount of the Advances, in whole or ratably in
part, together with accrued interest to the date of such prepayment on the
aggregate principal amount prepaid; provided, however, that (i) each
partial prepayment shall be in an aggregate principal amount of $500,000 or an
integral multiple of $100,000 in excess thereof and (ii) no such
prepayment of a Eurodollar Rate Advance shall be made other than on the last
day of an Interest Period therefor without payment by the Borrower of the
amounts provided for in Section 11.4(e).  Each prepayment made by the Borrower pursuant
to this Section 2.6(a) shall, at the Borrower’s option be
applied to either (i) repay the Facilities in the following manner: first,
to prepay Swing Line Advances then outstanding until such Advances are paid in
full; second, to prepay Letter of Credit Advances then outstanding until
such Advances are paid in full; and third, to prepay Revolving Credit
Advances then outstanding until such Revolving Credit Advances are paid in
full; (ii) repay the Facilities in the following manner: first, to
the Term A Facility (ratably to the remaining unpaid installments of
principal on the Term A Facility); second, to prepay Swing Line Advances
then outstanding until such Advances are paid in full; third, to prepay
Letter of Credit Advances then outstanding until such Advances are paid in
full; fourth, to prepay Revolving Credit Advances then outstanding
(whereupon the Revolving Credit Facility shall be permanently reduced as set
forth in Section 2.5(b)(i)) until such Revolving Credit Advances
are paid in full; and fifth, deposited in the L/C Cash Collateral
Account to cash collateralize 100% of the Available Amount of the Letters of Credit
then outstanding or (iii) first, to the Interim Term Facility; and second,
in the manner prescribed in either clause (i) or (ii) above.  Upon the drawing of any Letter of Credit for
which funds are on deposit in the L/C Cash Collateral Account, such funds shall
be applied to reimburse the Issuing Bank or the Revolving Credit Lenders, as
applicable.


 


(b)           Mandatory.


 


(i)            Within ninety (90) days
following the end of each Fiscal Year (beginning with the Fiscal Year ending July 31,
2006) in which the ratio of Consolidated Debt to EBITDA at the end of such
Fiscal Year is greater than or equal to 1.5:1, the Borrower shall execute and
deliver to the Administrative Agent a certificate of the Borrower’s president
or a vice president demonstrating its calculation of Excess Cash Flow for such
Fiscal Year along with a prepayment of the then outstanding Advances equal to
fifty percent (50%) of the annual Excess Cash Flow.


 


(ii)           Within fifteen (15) days after
receipt by any Loan Party or any of its Subsidiaries of Net Cash Proceeds from
Asset Dispositions or from any Debt Issuance, the Borrower shall prepay the
then outstanding Advances in an amount equal to, with respect to any (x) Asset
Disposition, one-hundred percent (100%) of such Net Cash Proceeds in
excess of $500,000 in any Fiscal Year and (y) Debt Issuance, one-hundred
percent (100%) of such Net Cash Proceeds.


 


(iii)          Within fifteen (15) days after
receipt by any Loan Party or any of its Subsidiaries of Net Cash Proceeds from
any Equity Issuance (unless at such time the ratio of Consolidated Debt to
EBITDA for the Borrower’s most recently completed and reported on four fiscal
quarters is less than or equal to 2.0:1.0), the Borrower shall prepay the then
outstanding Advances in an amount equal to one-hundred percent (100%) of
such Net Cash Proceeds.


 


34





















 


(iv)          Within fifteen (15) days after
receipt of Net Cash Proceeds by any Loan Party or any of its Subsidiaries from
any Extraordinary Receipt received by or paid to or for the account of any Loan
Party or any of its Subsidiaries, the Borrower shall prepay the then
outstanding Advances in an amount equal to fifty percent (50%) of such Net
Cash Proceeds in excess of $100,000 in the aggregate.


 


(v)           Each prepayment made by the Borrower
pursuant to clause (i), (ii), (iii) or (iv) shall be
subject to the provisions of Section 11.4(e) and shall be
applied to prepay the Facilities in the following manner: first, to the
Term A Facility (ratably to the remaining unpaid installments of principal
on the Term A Facility); second, to prepay Swing Line Advances then
outstanding until such Advances are paid in full; third, to prepay
Letter of Credit Advances then outstanding until such Advances are paid in
full; fourth, to prepay Revolving Credit Advances then outstanding
(whereupon the Revolving Credit Facility shall be permanently reduced as set
forth in Section 2.5(b)(i) in the amount of such prepayment)
until such Revolving Credit Advances are paid in full; and fifth,
deposited in the L/C Cash Collateral Account to cash collateralize 100% of the
Available Amount of the Letters of Credit then outstanding.  The portion of each such application
allocable to Eurodollar Rate Advances may, at the option of the Borrower (A) be
applied to repay such Advances immediately, even if such application shall
occur on other than the last day of an applicable Interest Period (in which
case the Borrower shall pay the amounts provided for in Section 11.4(e))
or (B) be deposited in the Prepayment Account and applied on the last day
of the applicable Interest Periods to prepay the Eurodollar Rate Advances that
would otherwise have been prepaid by the amounts deposited in the Prepayment
Account.  Upon the drawing of any Letter
of Credit for which funds are on deposit in the L/C Cash Collateral Account,
such funds shall be applied to reimburse the Issuing Bank or the Revolving
Credit Lenders, as applicable.  The
amount remaining (if any) after the required prepayment of the Advances then
outstanding and the 100% cash collateralization of the aggregate Available
Amount of Letters of Credit then outstanding (the sum of such prepayment
amounts, cash collateralization amounts and remaining amount being referred to
herein as the “Reduction Amount”) may be retained by the Borrower.  Upon the drawing of any Letter of Credit for
which funds are on deposit in the L/C Cash Collateral Account, such funds shall
be applied to reimburse the Issuing Bank or the Revolving Credit Lenders, as
applicable.  Upon the termination of all
of the Commitments and the indefeasible payment in full of all Obligations
arising under the Loan Documents, including, without limitation, termination or
expiration of all Letters of Credit, and the indefeasible payment in full of
all Obligations in respect of all Letters of Credit, as applicable, then all
amounts remaining on deposit in the L/C Cash Collateral Account shall be
returned to the Borrower.


 


(vi)          The Borrower shall, within
fifteen (15) days following the end of each month in each Fiscal Year, pay
to the Administrative Agent for deposit in the L/C Cash Collateral Account an
amount sufficient to cause the aggregate amount on deposit in such Account to
equal the amount by which the aggregate Available Amount of all Letters of
Credit then outstanding exceeds the Letter of Credit Commitment on such
Business Day.


 


(vii)         At any time that the aggregate amount
of Revolving Credit Advances outstanding exceeds the Revolving Credit
Availability, the Borrower shall immediately repay Revolving Credit Advances to
the extent necessary to reduce the principal balance of Revolving Credit
Borrowings to an amount equal to or less than the Revolving Credit
Availability.


 


35





















 


(viii)        The foregoing notwithstanding, the provisions
of this Section 2.6(b) shall not be construed to permit any
Equity Issuance, Debt Issuance or Asset Disposition otherwise prohibited under
the terms of this Agreement.


 


Section 2.7            Interest.


 


(a)           Scheduled
Interest.  The Borrower shall pay to
the Administrative Agent, for the benefit of the Lenders, interest on the
unpaid principal amount of each Advance owing to each Lender from the date of
such Advance until such principal amount shall be paid in full, at the
following rates per annum:


 


(i)            Prime Rate Advances.  During such periods as such Advance is a
Prime Rate Advance, a rate per annum equal at all times to the sum of
(x) the Prime Rate in effect from time to time plus (y) the
Applicable Margin for such Advance in effect from time to time, payable in
arrears monthly on the last day of each month during such periods and on the
date such Prime Rate Advance shall be Converted or paid in full.


 


(ii)           Eurodollar Rate Advances.  During such periods as such Advance is a
Eurodollar Rate Advance, a rate per annum equal at all times during each
Interest Period for such Advance to the sum of (x) the Eurodollar Rate for
such Interest Period for such Advance plus (y) the Applicable
Margin for such Advance in effect on the first day of such Interest Period, payable
in arrears on the last day of such Interest Period and, if such Interest Period
has a duration of more than three months, on each day that occurs during such
Interest Period every three months from the first day of such Interest Period
and on the date such Eurodollar Rate Advance shall be Converted or paid in
full.


 


(b)           Default
Interest.  (i) With respect to
any principal amount of any Advance not paid when due by the Borrower (whether
at the stated maturity, by acceleration or otherwise), the Borrower shall pay
interest on such unpaid principal amount, in arrears on the dates referred to
in clause (a)(i) or (a)(ii) above and on demand, at a rate
per annum equal at all times to the lesser of 2% per annum above the rate per
annum required to be paid on such Advance pursuant to clause (a)(i) or (a)(ii) above
or to the fullest extent permitted by law (the “Default Rate”) and (ii) with
respect to the amount of any interest, fee or other amount payable hereunder
not paid when due (whether at the stated maturity, by acceleration or
otherwise) the Borrower shall pay interest on such unpaid interest, fee or
other amount on demand at the Default Rate from the date such amount shall be
due until such amount shall be paid in full.


 


(c)           Notice
of Interest Rate.  Promptly after
receipt of a Notice of Borrowing pursuant to Section 2.2(a), the
Administrative Agent shall give notice to the Borrowers and each appropriate
Lender of the applicable interest rate determined by the Administrative Agent
for purposes of clause (a)(i) or (ii) of this Section 2.7.


 


Section 2.8            Fees.


 


(a)           Commitment
Fees.  The Borrower shall pay to the
Administrative Agent, for the account of the Lenders, commitment fees, from the
period commencing on the Closing Date until the Revolving Credit Termination
Date, payable in arrears quarterly on the last Business Day of each March,
June, September and December, commencing September 30, 2005, and on
the Revolving Credit Termination Date on the average daily Unused Revolving
Credit Commitment of such Lender at a rate per annum equal to the percentage
per annum determined pursuant to the last paragraph of this Section 2.8(a) by
reference to the ratio of Consolidated Debt to EBITDA at such time, as set
forth below:


 


36





















 


	
  Consolidated Debt

  to EBITDA Ratio

  	
   

  	
  Commitment fee

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Greater than 2.0 to 1.0

  	
   

  	
  .40

  	
  %

  
	
   

  	
   

  	
   

  	
   

  
	
  Greater than 1.5 to 1.0 but less than or
  equal to 2.0 to 1.0

  	
   

  	
  .30

  	
  %

  
	
   

  	
   

  	
   

  	
   

  
	
  Greater than 1.0 to 1.0 but less than or
  equal to 1.5 to 1.0

  	
   

  	
  .25

  	
  %

  
	
   

  	
   

  	
   

  	
   

  
	
  Equal to or Less than 1.0 to 1.0

  	
   

  	
  .20

  	
  %

  



 


The
ratio of Consolidated Debt to EBITDA shall be determined in the same manner as
is the Applicable Margin.  For purposes
of this subsection (a), Swing Line Advances shall only constitute
utilization of the Revolving Credit Commitment of any Revolving Lender actually
funding such Swing Line Advance pursuant to Section 2.2(b) and
shall not constitute utilization of the Revolving Credit Commitments of (i) the
Revolving Credit Lenders who have no outstanding Swing Line Advances or (ii) the
Swing Line Lender (in its capacity as a Revolving Lender) prior to such time as
the Revolving Lenders have funded Swing Line Advances following a demand from
the Swing Line Lender pursuant to Section 2.2(b).  Notwithstanding the foregoing, prior to the
date that the Borrower has delivered the financial information required by Section 7.2
for the fiscal quarter ending October 31, 2005, the rate per annum on the
average daily Unused Revolving Credit Commitment of such Lender shall be equal
to .40%.


 


(b)           Letter
of Credit Fees.  (i)     Letter
of Credit Fees.  The Borrower shall
pay to the Administrative Agent for the account of each Lender in accordance
with its Pro Rata Share a Letter of Credit fee (the “Letter of Credit Fee”)
(A) for each Trade Letter of Credit equal to 0.25% per annum times
the daily amount available to be drawn under such Letter of Credit and (B) for
each Standby Letter of Credit equal to the Applicable Margin then in effect for
Eurodollar Advances under the Revolving Credit Facility times the daily
maximum amount available to be drawn under such Letter of Credit.  For purposes of computing the daily amount
available to be drawn under any Letter of Credit, the amount of such Letter of
Credit shall be determined in accordance with Section 1.5.  Letter of Credit Fees shall be (A) computed
on a quarterly basis in arrears and (B) due and payable on the first
Business Day after the end of each March, June, September and December,
commencing with the first such date to occur after the issuance of such Letter
of Credit, on the date that is sixty (60) days before the Revolving Credit
Termination Date and thereafter on demand. 
If there is any change in the Applicable Margin then in effect for
Eurodollar Advances under the Revolving Credit Facility during any quarter, the
daily amount available to be drawn under each Standby Letter of Credit shall be
computed and multiplied by the Applicable Margin then in effect for Eurodollar
Advances under the Revolving Credit Facility separately for each period during
such quarter that such Applicable Margin was in effect.  Notwithstanding anything to the contrary
contained herein, upon the request of the Required Lenders, while
any Event of Default exists, all Letter of Credit Fees shall accrue at the
Default Rate.


 


(ii)           Fronting Fee and Documentary and
Processing Charges Payable to Issuing Bank. The Borrower shall pay directly
to the Issuing Bank for its own account a fronting fee (A) with respect to
each Trade Letter of Credit, equal to 0.25% of the amount of such Trade Letter
of Credit, and payable upon the issuance thereof, (B) with respect to any
amendment of a Trade Letter of Credit increasing the amount of such Letter of
Credit, at a rate separately agreed between the Borrower and the Issuing Bank,
computed on the amount of such increase, and payable upon the effectiveness of
such amendment, and (C) with
respect to each Standby Letter of Credit, at 0.25% per annum, computed on the
actual daily maximum amount available to be drawn under such Letter of Credit
(whether or not such maximum amount is then in effect under


 


37





















 


such
Letter of Credit) and on a quarterly basis in arrears.  Such fronting fee shall be due and payable on
the tenth Business Day after the end of each March, June, September and December in
respect of the most recently-ended quarterly period (or portion thereof, in the
case of the first payment), commencing with the first such date to occur after
the issuance of such Letter of Credit, on the date that is sixty (60) days
before the Revolving Credit Termination Date and thereafter on demand.  For purposes of computing the daily amount
available to be drawn under any Letter of Credit, the amount of such Letter of
Credit shall be determined in accordance with Section 1.5.  In addition, the Borrower shall pay directly
to the Issuing Bank for its own account the customary issuance, presentation,
amendment and other processing fees, and other standard costs and charges, of
the Issuing Bank 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.


 


(c)           Administrative
Agent’s Fees.  The Borrower shall pay
to the Administrative Agent for its own account such fees as provided in the
Fee Letter or as may otherwise from time to time be agreed in writing between
the Borrower and the Administrative Agent.


 


Section 2.9            Conversion
of Advances.


 


(a)           Optional.  The Borrower may on any Business Day, upon
notice given to the Administrative Agent not later than 11:00 a.m.
(New York time) on the third Business Day prior to the date of the
proposed Conversion and subject to the provisions of Sections 2.7
and 2.10, Convert all or any portion of the Advances of one Type
comprising the same Borrowing into Advances of the other Type; provided,
however, that any Conversion of Eurodollar Rate Advances into Prime Rate
Advances shall be made only on the last day of an Interest Period for such
Eurodollar Rate Advances unless the Borrower pays the amounts, if any, provided
for in Section 11.4(e), any Conversion of Prime Rate Advances into
Eurodollar Rate Advances shall be in an amount not less than the minimum amount
specified in Section 2.1(c), no Conversion of any Advances shall
result in more separate Borrowings than permitted under Section 2.2(c) and
each Conversion of Advances comprising part of the same Borrowing under any
Facility shall be made ratably among the appropriate Lenders in accordance with
their Commitments under such Facility. 
Each such notice of Conversion shall, within the restrictions specified
above, specify (i) the date of such Conversion, (ii) the Advances to
be Converted and (iii) if such Conversion is into Eurodollar Rate
Advances, the duration of the initial Interest Period for such Advances.  Each notice of Conversion shall be
irrevocable and binding on the Borrower.


 


(b)           Mandatory.  (i)  On the date on which the
aggregate unpaid principal amount of Eurodollar Rate Advances comprising any Borrowing
shall be reduced, by payment or prepayment or otherwise, to less than $500,000,
such Advances shall automatically Convert into Prime Rate Advances.


 


(ii)           If the Borrower shall fail to select
the duration of any Interest Period for any Eurodollar Rate Advances in
accordance with the provisions contained in the definition of “Interest Period”
in Section 1.1, the Administrative Agent will forthwith so notify
the Borrower and the appropriate Lenders, whereupon each such Eurodollar Rate
Advance will automatically, on the last day of the then existing Interest
Period therefor, Convert into a Prime Rate Advance.


 


(iii)          Upon the occurrence and during the
continuance of any Event of Default and the acceleration of the Notes, interest
thereon and other amounts payable by the Borrower under this Agreement and the
other Loan Documents pursuant to Article IX, (x) each
Eurodollar Rate Advance will automatically, on the last day of the then
existing Interest Period therefor, Convert into a Prime Rate Advance and (y) the
obligation of the Lenders to make, or to Convert Advances into, Eurodollar Rate
Advances shall be suspended.


 


38





















 


Section 2.10         Increased
Costs, Etc.


 


(a)           If,
due to either (i) the introduction of or any change in reserve
requirements included in the Eurodollar Rate Reserve Percentage, or in the
interpretation of any law or regulation, or (ii) the compliance with any
guideline or request from any central bank or other governmental authority
(whether or not having the force of law), there shall be any increase in the
cost to any Lender Party of agreeing to make or of making, funding or
maintaining Eurodollar Rate or Prime Rate Advances or of agreeing to issue or
of issuing or maintaining Letters of Credit or of agreeing to make or of making
or maintaining Letter of Credit Advances (excluding for purposes of this Section 2.10
any such increased costs resulting from (x) Taxes or Other Taxes (as to
which Section 2.12 shall govern) and (y) changes in the basis
of taxation of overall net income or overall gross income by the
United States or by the foreign jurisdiction or state under the laws of
which such Lender Party is organized or has its Applicable Lending Office or
any political subdivision thereof), then the Borrower shall from time to time,
upon demand by such Lender Party (with a copy of such demand to the
Administrative Agent), pay to the Administrative Agent for the account of such
Lender Party additional amounts sufficient to compensate such Lender Party for
such increased cost; provided, however, that a Lender Party
claiming additional amounts under this Section 2.10(a) agrees
to use reasonable efforts (consistent with its internal policy and legal and
regulatory restrictions) to designate a different Applicable Lending Office if
the making of such a designation would avoid the need for, or reduce the amount
of, such increased cost that may thereafter accrue and would not, in the
reasonable judgment of such Lender Party, be otherwise disadvantageous to such
Lender Party.  A certificate as to the
amount of such increased cost, submitted to the Borrower by such Lender Party,
shall be conclusive and binding for all purposes, absent manifest error.


 


(b)           If,
due to either (i) the introduction of or any change in or in the
interpretation of any law or regulation or (ii) the compliance with any
guideline or request from any central bank or other governmental authority
(whether or not having the force of law), there shall be any increase in the
amount of capital required or reasonably expected to be maintained by any
Lender Party or any corporation controlling such Lender Party as a result of or
based upon the existence of such Lender Party’s commitment to lend or to issue
Letters of Credit hereunder and other commitments of such type or the issuance
or maintenance of the Letters of Credit (or similar contingent obligations),
then, upon demand by such Lender Party (with a copy of such demand to the
Administrative Agent), the Borrower shall pay to the Administrative Agent for
the account of such Lender Party, from time to time as specified by such Lender
Party, additional amounts sufficient to compensate such Lender Party in the
light of such circumstances, to the extent that such Lender Party reasonably
determines such increase in capital to be allocable to the existence of such
Lender Party’s commitment to lend or to issue Letters of Credit hereunder or to
the issuance or maintenance of any Letters of Credit.  A certificate as to such amounts submitted to
the Borrower by such Lender Party shall be conclusive and binding for all
purposes, absent manifest error.


 


(c)           If,
with respect to any Eurodollar Rate Advances under any Facility, Lenders owed
greater than 50% of the then aggregate unpaid principal amount thereof notify
the Administrative Agent that the Eurodollar Rate for any Interest Period for
such Advances will not adequately reflect the cost to such Lenders of making,
funding or maintaining their Eurodollar Rate Advances for such Interest Period,
the Administrative Agent shall forthwith so notify the Borrower and the
appropriate Lenders, whereupon (i) each such Eurodollar Rate Advance under
any Facility will automatically, on the last day of the then existing Interest
Period therefor, Convert into a Prime Rate Advance and (ii) the obligation
of the appropriate Lenders to make, or to Convert Advances into, Eurodollar
Rate Advances shall be suspended until the Administrative Agent shall notify
the Borrower that such Lenders have determined that the circumstances causing
such suspension no longer exist.


 


39





















 


(d)           Notwithstanding
any other provision of this Agreement, if the introduction of or any change in
or in the interpretation of any law or regulation shall make it unlawful, or
any central bank or other governmental authority shall assert that it is
unlawful, for any Lender or its Eurodollar Lending Office to perform its
obligations hereunder to make Eurodollar Rate Advances or to continue to fund
or maintain Eurodollar Rate Advances hereunder, then, on notice thereof and
demand therefor by such Lender to the Borrower through the Administrative
Agent, (i) each Eurodollar Rate Advance under each Facility under which
such Lender has a Commitment will automatically, upon such demand, Convert into
a Prime Rate Advance and (ii) the obligation of the appropriate Lenders to
make, or to Convert Advances into, Eurodollar Rate Advances shall be suspended
until the Administrative Agent shall notify the Borrower that such Lender has determined
that the circumstances causing such suspension no longer exist; provided,
however, that before making any such demand, such Lender agrees to use
reasonable efforts (consistent with its internal policy and legal and
regulatory restrictions) to designate a different Eurodollar Lending Office if
the making of such a designation would allow such Lender or its Eurodollar
Lending Office to continue to perform its obligations to make Eurodollar Rate
Advances or to continue to find or maintain Eurodollar Rate Advances and would
not, in the judgment of such Lender, be otherwise disadvantageous to such
Lender.


 


Section 2.11         Payments
and Computations.


 


(a)           The
Borrower shall make each payment hereunder and under the Notes, irrespective of
any right of counterclaim or set-off (except as otherwise provided in Section 2.15),
not later than 11:00 a.m. (New York time) on the day when due in
Dollars to the Administrative Agent at the Administrative Agent’s Account in
same day funds.  The Administrative Agent
will promptly thereafter cause like funds to be distributed (i) if such
payment by the Borrower is in respect of principal, interest, commitment fees
or any other Obligation then payable hereunder and under the Notes to more than
one Lender Party, to such Lender Parties for the account of their respective
Applicable Lending Offices ratably in accordance with the amounts of such
respective Obligations then payable to such Lender Parties and (ii) if
such payment by the Borrower is in respect of any Obligation then payable
hereunder to one Lender Party, to such Lender Party for the account of its
Applicable Lending Office, in each case to be applied in accordance with the
terms of this Agreement.  Upon its
acceptance of an Assignment and Assumption and recording of the information
contained therein in the Register pursuant to Section 11.7(c), from
and after the effective date of such Assignment and Assumption, the
Administrative Agent shall make all payments hereunder and under the Notes in
respect of the interest assigned thereby to the Lender Party assignee
thereunder, and the parties to such Assignment and Assumption shall make all
appropriate adjustments in such payments for periods prior to such effective
date directly between themselves.


 


(b)           If
the Administrative Agent receives funds for application to the Obligations
under the Loan Documents under circumstances for which the Loan Documents do
not specify the Advances or the Facility to which, or the manner in which, such
funds are to be applied, the Administrative Agent shall distribute such funds
to each Lender Party ratably in accordance with such Lender Party’s
proportionate share of the principal amount of all outstanding Advances and the
Available Amount of all Letters of Credit then outstanding in repayment or
prepayment of such of the outstanding Advances or other Obligations owed to
such Lender Party, and for application to such principal installments, as the
Administrative Agent shall direct.


 


(c)           The
Borrower hereby authorizes each Lender Party, if and to the extent payment owed
to such Lender Party is not made when due hereunder or, in the case of a
Lender, under the Note held by such Lender, to charge from time to time against
any or all of the Borrower’s accounts with such Lender Party any amount so due.


 


40





















 


(d)           All
Prime Rate Advances shall be computed on the basis of the actual number of days
elapsed in the period during which interest accrues and a year of 365 or
366 days, as applicable, and all Eurodollar Rate Advances shall be
computed on the basis of the actual number of days elapsed in the period during
which interest accrues and a year of 360 days.  All computations of interest, fees, and
Letter of Credit commissions shall be made by the Administrative Agent on the
basis of a year of 360 days (or in the case of Prime Rate Advances
365 or 366, as applicable), in each case for the actual number of
days (including the first day but excluding the last day) occurring in the
period for which such interest, fees or commissions are payable.  Each determination by the Administrative
Agent of an interest rate, fee or commission hereunder shall be conclusive and
binding for all purposes, absent manifest error.


 


(e)           Whenever
any payment hereunder or under the Notes shall be stated to be due on a day
other than a Business Day, such payment shall be made on the next succeeding
Business Day, and such extension of time shall in such case be included in the
computation of payment of interest or commitment fee, as the case may be; provided,
however, that, if such extension would cause payment of interest on or
principal of Eurodollar Rate Advances to be made in the next following calendar
month, such payment shall be made on the next preceding Business Day.


 


(f)            Unless
the Administrative Agent shall have received notice from the Borrower prior to
the date on which any payment is due to the Administrative Agent for the
account of any of the Lender Parties hereunder that the Borrower will not make
such payment, the Administrative Agent may assume that the Borrower has made
such payment on such date in accordance herewith and may, in reliance upon such
assumption, distribute to the applicable Lender Parties the amount due.  In such event, if the Borrower has not in
fact made such payment, then each of the applicable Lender Parties, severally
agrees to repay to the Administrative Agent forthwith on demand the amount so
distributed to such Lender Party, in immediately available funds with interest
thereon, for each day from and including the date such amount is distributed to
it to but excluding the date of payment to the Administrative Agent, at the
greater of the Federal Funds Rate and a rate determined by the Administrative
Agent in accordance with banking industry rules on interbank
compensation.  A notice of the
Administrative Agent to any Lender Party or the Borrower with respect to any
amount owing under this subsection (f) shall be conclusive, absent
manifest error.


 


Section 2.12         Taxes.


 


(a)           Any
and all payments by the Borrower hereunder or under the Notes, together with
any interest, additions, or similar amounts with respect thereto and any
interest in respect of such additions or penalties, shall be made, in
accordance with Section 2.11, free and clear of and without deduction
for any and all present or future taxes, levies, imposts, deductions, charges
or withholdings, and all liabilities with respect thereto, excluding, in the
case of each Lender Party and the Administrative Agent, net income taxes that
are imposed by the United States and net income taxes (or franchise taxes
imposed in lieu thereof) that are imposed on such Lender Party or the
Administrative Agent by the state or foreign jurisdiction under the laws of
which such Lender Party or the Administrative Agent (as the case may be) is
organized or any political subdivision thereof and, in the case of each Lender
Party, net income taxes (or franchise taxes imposed in lieu thereof) that are
imposed on such Lender Party by the state or foreign jurisdiction of such Lender
Party’s Applicable Lending Office or any political subdivision thereof (all
such non-excluded taxes, levies, imposts, deductions, charges, withholdings and
liabilities in respect of payments hereunder or under the Notes being
hereinafter referred to as “Taxes”). 
If the Borrower shall be required by law to deduct any Taxes from or in
respect of any sum payable hereunder or under any Note to any Lender Party or
the Administrative Agent, (i) the sum payable shall be increased as may be
necessary so that after making all required deductions (including deductions
applicable to additional sums payable under this Section 2.12) such
Lender Party or the Administrative Agent (as the case may be) receives an
amount equal to the sum it would have received had no such deductions been
made, (ii) the


 


41





















 


Borrower shall make such
deductions and (iii) the Borrower shall pay the full amount deducted to
the relevant taxation authority or other authority in accordance with
applicable law.


 


(b)           In
addition, the Borrower shall pay any present or future stamp, documentary,
excise, property or similar taxes, charges or levies that arise from any
payment made hereunder or under the Notes or from the execution, delivery or
registration of, performing under, or otherwise with respect to, this Agreement
or the Notes (hereinafter referred to as “Other Taxes”).


 


(c)           The
Borrower shall indemnify each Lender Party and the Administrative Agent for the
full amount of Taxes and Other Taxes, and for the full amount of taxes imposed
by any jurisdiction on amounts payable under this Section 2.12,
imposed on or paid by such Lender Party or the Administrative Agent (as the
case may be) and any liability (including penalties, additions to tax, interest
and expenses) arising therefrom or with respect thereto, except with respect to
any Lender Party or the Administrative Agent, as the case may be, for such a
liability arising from such Lender Party’s or the Administrative Agent’s, as
the case may be, willful misconduct or gross negligence.  This indemnification shall be made within
thirty (30) days from the date such Lender Party or the Administrative
Agent, as the case may be, makes written demand specifying in reasonable detail
the basis therefor.


 


(d)           Within
thirty (30) days after the date of any payment of Taxes, the Borrower
shall furnish to the Administrative Agent, at its address referred to in Section 11.2,
the original receipt of payment thereof or a certified copy of such
receipt.  In the case of any payment
hereunder or under the Notes by or on behalf of the Borrower through an account
or branch outside the United States or by or on behalf of the Borrower by
a payor that is not a United States person, if the Borrower determines that
no Taxes are payable in respect thereof, the Borrower shall furnish, or shall
cause such payor to furnish, to the Administrative Agent, at such address, an
opinion of counsel acceptable to the Administrative Agent stating that such
payment is exempt from Taxes.  For
purposes of this subsection (d) and subsection (e), the terms “United States”
and “United States person” shall have the meanings specified in Section 7701
of the Internal Revenue Code.


 


(e)           Each
Lender Party organized under the laws of a jurisdiction outside the
United States (a “Non-U.S. Lender”) shall, on or prior to the date
of its execution and delivery of this Agreement in the case of each initial
Lender or Issuing Bank, as the case may be, and on the date of the Assignment
and Assumption pursuant to which it became a Lender Party in the case of each
other Lender Party, and from time to time thereafter as requested in writing by
the Borrower or the Administrative Agent (but only so long thereafter as such
Lender Party remains lawfully able to do so), provide each of the
Administrative Agent and the Borrower with two (2) original Internal
Revenue Service forms W-8BEN, W-8ECI or W-8IMY, as
appropriate, or any successor or other form prescribed by the Internal Revenue
Service, certifying that such Lender is exempt from or entitled to a reduced
rate of United States withholding tax on payments pursuant to this
Agreement or the Notes.  A Form W-8BEN
completed and delivered by (i) certain foreign trusts, or (ii) persons
claiming an exemption or reduced rate of withholding at source under an income
tax treaty will not be considered duly completed unless the Form W-8BEN
contains such Person’s U.S. taxpayer identification number.  A Non-U.S. Lender claiming exemption from
U.S. federal withholding tax under Section 871(h) or 881(c) of
the Internal Revenue Code with respect to payments of “portfolio interest”
shall deliver a statement substantially in the form of Exhibit H
and a Form W-8BEN (certifying as to beneficial ownership) or
successor form thereto or any subsequent versions thereof properly completed
and duly executed by such Non-U.S. Lender claiming complete exemption from U.S.
federal withholding tax on all payments by the Borrower under this Agreement
and the other Loan Documents.  Thereafter
and from time to time, each such Non-U.S. Lender shall (A) 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


 


42





















 


is satisfactory to the Borrower
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 Non-U.S. Lender by the applicable Loan Party pursuant to this Agreement
and (B) promptly notify the Administrative Agent of any change in circumstances
which would modify or render invalid any claimed exemption or reduction.  If such Non-U.S. Lender fails to deliver the
above forms or other documentation, then the Administrative Agent may withhold
from any interest payment to such Non-U.S. Lender an amount equivalent to the
applicable withholding tax imposed by Sections 1441 and 1442 of the
Internal Revenue Code, without reduction, provided that the applicable Loan
Party shall not be required to increase any such amounts payable to any
Non-U.S. Lender pursuant to Section 2.12, unless, as a result of
any change in an applicable law, treaty or governmental rule, regulation or
order, or any change in the interpretation, administration or application
thereof, such Non-U.S. Lender is no longer properly entitled to deliver forms,
certificates or other evidence as to such Non-U.S. Lender’s entitlement to
exemption from, or reduction of, U.S. withholding tax.


 


(f)            Any
Lender Party claiming any additional amounts payable pursuant to this Section 2.12
agrees to use reasonable efforts (consistent with its internal policy and legal
and regulatory restrictions) to change the jurisdiction of its Eurodollar
Lending Office if the making of such a change would avoid the need for, or
reduce the amount of, any such additional amounts that may thereafter accrue
and would not, in the reasonable judgment of such Lender Party, be otherwise
disadvantageous to such Lender Party.


 


(g)           If
any Non-U.S. Lender claims exemption from, or reduction of, withholding tax
under a United States tax treaty by providing IRS Form W-8BEN
or W-8IMY (or any successor form) or claims an exemption from
withholding tax by providing an IRS Form W-8ECI (or any successor
form) and such Non-U.S. Lender sells, assigns or (other than pursuant to clause (h) below)
otherwise transfers all or part of the Obligations of a Lender Party to a
transferee Lender, such Non-U.S. Lender agrees to notify the Administrative
Agent of the percentage amount in which it is no longer the beneficial owner of
such Obligations of a Lender Party.  To
the extent of such percentage amount, the Administrative Agent will treat such
Non-U.S. Lender’s IRS Form W-8BEN, W-8IMY or W-8ECI
(or any successor form) as no longer valid.


 


(h)           If
any Non-U.S. Lender claims an exemption from, or reduction of, withholding tax
under a United States tax treaty by providing IRS Form W-8BEN
or W-8IMY (or any successor form) or claims an exemption from
withholding tax by providing Form W-8ECI (or any successor form) and
such Non-U.S. Lender grants a participation in the Obligations of a Lender
Party to a transferee Lender, such Non-U.S. Lender agrees to notify the
Administrative Agent of the percentage amount in which it is no longer the
beneficial owner of such Obligations of a Lender Party, and such Non-U.S.
Lender agrees to undertake responsibility to provide to the Administrative
Agent such forms and documentation (including IRS Form W-8IMY and
forms and documentation provided by each participant to the extent required by
the IRS) to enable each Lender Party to comply with the withholding tax
requirements imposed by Sections 1441 and 1442 of the Internal
Revenue Code.


 


(i)            If
the IRS or any other governmental authority of the United States or other
jurisdiction asserts a claim that the Administrative Agent did not properly
withhold tax or any other amount from amounts paid to or for the account of any
Non-U.S. Lender (because the appropriate form was not delivered or was not
properly executed, or because such Non-U.S. Lender failed to notify the Administrative
Agent of a change in circumstances which rendered the exemption from, or
reduction of, withholding tax ineffective, or for any other reason) such
Non-U.S. Lender shall indemnify the Administrative Agent fully for all amounts
paid, directly or indirectly, by the Administrative Agent as tax or otherwise,
including any interest, additions, penalties or similar amounts, and including
any taxes imposed by any jurisdiction on the amounts payable to the
Administrative Agent under this Section 2.12, together with all
costs and expenses (including attorney fees and expenses).  The obligation of the


 


43





















 


Lenders under this clause (i) shall
survive the payment of all Obligations and the resignation or replacement of
the Administrative Agent.


 


Section 2.13         Sharing
of Payments, Etc.


 


If
any Lender Party shall obtain at any time any payment (whether voluntary,
involuntary, through the exercise of any right of set-off, or otherwise) (i) on
account of Obligations due and payable to such Lender Party hereunder or under
the Notes at such time in excess of its ratable share (according to the
proportion of (x) the amount of such Obligations due and payable to such
Lender Party at such time to (y) the aggregate amount of the Obligations
due and payable to all Lender Parties hereunder and under the Notes at such
time) of payments on account of the Obligations due and payable to all Lender
Parties hereunder or under the Notes at such time obtained by all the Lender
Parties at such time or (ii) on account of Obligations owing (but not due
and payable) to such Lender Party hereunder and under the Notes at such time in
excess of its ratable share (according to the proportion of (x) the amount
of such Obligations owing to such Lender Party at such time to (y) the
aggregate amount of the Obligations owing (but not due and payable) to all
Lender Parties hereunder and under the Notes at such time) of payments on
account of the Obligations owing (but not due and payable) to all Lender Parties
hereunder and under the Notes at such time obtained by all of the Lender
Parties at such time, such Lender Party shall forthwith purchase from the other
Lender Parties such participations in the Obligations due and payable or owing
to them, as the case may be, as shall be necessary to cause such purchasing
Lender Party to share the excess payment ratably with each of them; provided,
however, that if all or any portion of such excess payment is thereafter
recovered from such purchasing Lender Party, such purchase from each other
Lender Party shall be rescinded and each such other Lender Party shall repay to
the purchasing Lender Party the purchase price to the extent of such Lender
Party’s ratable share (according to the proportion of (x) the purchase price
paid to such Lender Party to (y) the aggregate purchase price paid to all
Lender Parties) of such recovery together with an amount equal to such Lender
Party’s ratable share (according to the proportion of (x) the amount of
such other Lender Party’s required repayment to (y) the total amount of
such required repayments to the purchasing Lender Party) of any interest or
other amount paid or payable by the purchasing Lender Party in respect of the
total amount so recovered.


 


The
Borrower agrees that any Lender Party so purchasing a participation from
another Lender Party pursuant to this Section 2.13 may, to the
fullest extent permitted by law, exercise all its rights of payment (including
the right of set-off) with respect to such participation as fully as if such
Lender Party were the direct creditor of the Borrower in the amount of such
participation.


 


Section 2.14         Use of
Proceeds.


 


The
proceeds of the Advances and issuances of Letters of Credit shall be available,
and the Borrower shall use such proceeds and Letters of Credit solely (a) to
finance, in part, the Crosstex Acquisition, to pay fees and expenses incurred
in connection with the Crosstex Acquisition, (b) to repay existing
indebtedness and (c) to finance working capital and other lawful corporate
purposes including Permitted Acquisitions and capital expenditures.


 


Section 2.15         Defaulting
Lenders.


 


(a)           In the event that, at any one time, (i) any
Lender Party shall be a Defaulting Lender, (ii) such Defaulting Lender
shall owe a Defaulted Advance to the Borrower and (iii) the Borrower shall
be required to make any payment hereunder or under any other Loan Document to
or for the account of such Defaulting Lender, then the Borrower may, so long as
no Default shall occur or be continuing at such time and to the fullest extent
permitted by applicable law, set off and otherwise apply the obligation of the
Borrower to make such payment to or for the account of such Defaulting Lender
against the


 


44





















 


obligation of such Defaulting
Lender to make such Defaulted Advance. 
In the event that, on any date, the Borrower shall so set off and
otherwise apply its obligation to make any such payment against the obligation
of such Defaulting Lender to make any such Defaulted Advance on or prior to
such date, the amount so set off and otherwise applied by the Borrower shall
constitute for all purposes of this Agreement and the other Loan Documents an
Advance by such Defaulting Lender made on the date under the Facility pursuant
to which such Defaulted Advance was originally required to have been made
pursuant to Section 2.1. 
Such Advance shall be a Prime Rate Advance and shall be considered, for
all purposes of this Agreement, to comprise part of the Borrowing in connection
with which such Defaulted Advance was originally required to have been made
pursuant to Section 2.1, even if the other Advances comprising such
Borrowing shall be Eurodollar Rate Advances on the date such Advance is deemed
to be made pursuant to this subsection (a).  The Borrower shall notify the Administrative
Agent at any time the Borrower exercises its right of set-off pursuant to this
subsection (a) and shall set forth in such notice (i) the name
of the Defaulting Lender and the Defaulted Advance required to be made by such
Defaulting Lender and (ii) the amount set off and otherwise applied in
respect of such Defaulted Advance pursuant to this subsection (a).  Any portion of such payment otherwise
required to be made by the Borrower to or for the account of such Defaulting
Lender which is paid by the Borrower, after giving effect to the amount set off
and otherwise applied by the Borrower pursuant to this subsection (a),
shall be applied by the Administrative Agent as specified in subsection (b) or (c) of
this Section 2.15.


 


(b)           In
the event that, at any one time, (i) any Lender Party shall be a
Defaulting Lender, (ii) such Defaulting Lender shall owe a Defaulted
Amount to the Administrative Agent or any of the other Lender Parties and (iii) the
Borrower shall make any payment hereunder or under any other Loan Document to
the Administrative Agent for the account of such Defaulting Lender, then the
Administrative Agent may, on its behalf or on behalf of such other Lender
Parties and to the fullest extent permitted by applicable law, apply at such
time the amount so paid by the Borrower to or for the account of such
Defaulting Lender to the payment of each such Defaulted Amount to the extent
required to pay such Defaulted Amount. 
In the event that the Administrative Agent shall so apply any such
amount to the payment of any such Defaulted Amount on any date, the amount so
applied by the Administrative Agent shall constitute for all purposes of this
Agreement and the other Loan Documents, payment, to such extent, of such
Defaulted Amount on such date.  Any such
amount so applied by the Administrative Agent shall be retained by the
Administrative Agent or distributed by the Administrative Agent to such other
Lender Parties, ratably in accordance with the respective portions of such
Defaulted Amounts payable at such time to the Administrative Agent and such
other Lender Parties and, if the amount of such payment made by the Borrower
shall at such time be insufficient to pay all Defaulted Amounts owing at such
time to the Administrative Agent and the other Lender Parties, in the following
order of priority:


 


(i)            first, to the Administrative
Agent for any Defaulted Amount then owing to the Administrative Agent; and


 


(ii)           second, to the Lender Parties
for any Defaulted Amounts then owing to such Lender Parties, ratably in
accordance with such respective Defaulted Amounts then owing to such Lender
Parties.


 


Any
portion of such amount paid by the Borrower for the account of such Defaulting
Lender remaining, after giving effect to the amount applied by the
Administrative Agent pursuant to this subsection (b), shall be applied by
the Administrative Agent as specified in subsection (c) of this Section 2.15.


 


(c)           In
the event that, at any one time, (i) any Lender Party shall be a
Defaulting Lender, (ii) such Defaulting Lender shall not owe a Defaulted
Advance or a Defaulted Amount and (iii) the Borrower, the Administrative
Agent or any other Lender Party shall be required to pay or distribute any


 


45





















 


amount hereunder or under any
other Loan Document to or for the account of such Defaulting Lender, then the
Borrower or such other Lender Party shall pay such amount to the Administrative
Agent to be held by the Administrative Agent, to the fullest extent permitted
by applicable law, in escrow or the Administrative Agent shall, to the fullest
extent permitted by applicable law, hold in escrow such amount otherwise held
by it.  Any funds held by the
Administrative Agent in escrow under this subsection (c) shall be
deposited by the Administrative Agent in an account with Bank of America, in
the name and under the control of the Administrative Agent, but subject to the
provisions of this subsection (c). 
The terms applicable to such account, including the rate of interest
payable with respect to the credit balance of such account from time to time,
shall be Bank of America’s standard terms applicable to escrow accounts
maintained with it.  Any interest
credited to such account from time to time shall be held by the Administrative
Agent in escrow under, and applied by the Administrative Agent from time to
time in accordance with the provisions of, this subsection (c).  The Administrative Agent shall, to the
fullest extent permitted by applicable law, apply all funds so held in escrow
from time to time to the extent necessary to make any Advances required to be
made by such Defaulting Lender and to pay any amount payable by such Defaulting
Lender hereunder and under the other Loan Documents to the Administrative Agent
or any other Lender Party, as and when such Advances or amounts are required to
be made or paid and, if the amount so held in escrow shall at any time be
insufficient to make and pay all such Advances and amounts required to be made
or paid at such time, in the following order of priority:


 


(i)            first, to the Administrative
Agent for any amount then due and payable by such Defaulting Lender to the
Administrative Agent hereunder;


 


(ii)           second, to the Lender Parties
for any amount then due and payable by such Defaulting Lender to such Lender
Parties hereunder, ratably in accordance with such respective amounts then due
and payable to such Lender Parties; and


 


(iii)          third, to the Borrower for any
Advance then required to be made by such Defaulting Lender pursuant to a
Commitment of such Defaulting Lender.


 


In
the event that any Lender Party that is a Defaulting Lender shall, at any time,
cease to be a Defaulting Lender, any funds held by the Administrative Agent in
escrow at such time with respect to such Lender Party shall be distributed by
the Administrative Agent to such Lender Party and applied by such Lender Party
to the Obligations owing to such Lender Party at such time under this Agreement
and the other Loan Documents in such manner as the Administrative Agent shall
reasonably direct.


 


(d)           The
rights and remedies against a Defaulting Lender under this Section 2.15
are in addition to other rights and remedies that the Borrower may have against
such Defaulting Lender with respect to any Defaulted Advance and that the
Administrative Agent or any Lender Party may have against such Defaulting
Lender with respect to any Defaulted Amount.


 


Section 2.16         Removal
of Lender.


 


If
(i) any Lender requests compensation under Section 2.12 or
asserts pursuant to Section 2.10(d) that it is unlawful for
such Lender to make Eurodollar Rate Advances, (ii) the Borrower is
required to pay any additional amount to any Lender or any Governmental
Authority for the account of any Lender pursuant to Section 2.12, (iii) a
Lender (a “Non-Consenting Lender”) does not consent to a proposed
change, waiver, discharge or termination with respect to any Loan Document that
has been approved by the Required Lenders as provided in Section 11.1
but requires unanimous consent of all Lenders or all Lenders directly affected
thereby (as applicable) and, or (iv) any Lender is a Defaulting Lender,
then the Borrower may, at its sole expense and effort, upon notice to such
Lender and the Administrative Agent, require such Lender to assign and
delegate, without recourse (in accordance with and subject to the


 


46





















 


restrictions contained in, and
consents required by, Section 11.7), all of its interests, rights
and obligations under this Agreement and the related Loan Documents to an
assignee that shall assume such obligations (which assignee may be another
Lender, if a Lender accepts such assignment), provided that:


 


(a)           the Borrower shall have paid to the
Administrative Agent the assignment fee specified in Section 11.7(b);


 


(b)           such Lender shall have received
payment of an amount equal to the outstanding principal of its Obligations,
accrued interest thereon, accrued fees and all other amounts payable to it
hereunder and under the other Loan Documents (including any amounts under Section 11.4(e))
from the assignee (to the extent of such outstanding principal and accrued
interest and fees) or the Borrower (in the case of all other amounts);


 


(c)           in the case of any such assignment
resulting from a claim for compensation under Section 2.10 or
payments required to be made pursuant to Section 2.12, such
assignment will result in a reduction in such compensation or payments
thereafter;


 


(d)           such assignment does not conflict
with applicable laws; and


 


(e)           in
the case of any such assignment resulting from a Non-Consenting Lender’s
failure to consent to a proposed change, waiver, discharge or termination with
respect to any Loan Document, the applicable replacement bank, financial
institution or Fund consents to the proposed change, waiver, discharge or
termination; provided that the failure by such Non-Consenting Lender to
execute and deliver an Assignment and Assumption shall not impair the validity
of the removal of such Non-Consenting Lender and the mandatory assignment of
such Non-Consenting Lender’s Commitments and outstanding Loans and
participations in Letters of Credit and Swing Line Advances pursuant to this Section 2.16
shall nevertheless be effective without the execution by such Non-Consenting
Lender of an Assignment and Assumption.


 


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


 


ARTICLE III


 


CONDITIONS OF LENDING


 


Section 3.1            Conditions Precedent to Initial
Extension of Credit.


 


The
obligation of each Lender to make an Advance or of the Issuing Bank to issue a
Letter of Credit on the occasion of the Initial Extension of Credit hereunder
is subject to the satisfaction of each of the following conditions precedent
before or concurrently with the Initial Extension of Credit:


 


(a)           The Administrative Agent shall have
received the following, each dated as of the Closing Date (unless otherwise
specified), in form and substance satisfactory to the Administrative Agent and
the Lenders:


 


(i)            The Notes payable to the order of
the Lenders duly executed by the Borrower.


 


47





















 


(ii)           The Security Agreement, duly executed
by each Loan Party, together with:


 


(A)          Uniform Commercial Code financing
statements for each appropriate jurisdiction as is necessary, in the
Administrative Agent’s sole discretion, to perfect the Administrative Agent’s
security interest in the Collateral;


 


(B)           searches of Uniform Commercial Code
filings in the jurisdiction of formation of each Loan Party, the jurisdiction
of the chief executive office of each Loan Party and each jurisdiction where
any Collateral is located or where a filing would need to be made in order to
perfect the Administrative Agent’s security interest in the Collateral, copies
of the financing statements on file in such jurisdictions and evidence that no
Liens exist other than Liens permitted under Section 6.1;


 


(C)           evidence of the completion of all
other recordings and filings of or with respect to the Security Agreement that
the Administrative Agent may deem necessary or desirable in order to perfect
and protect the Liens created thereby;


 


(D)          original stock certificates
representing the Pledged Shares referred to in the Security Agreement,
accompanied by undated stock powers executed in blank and irrevocable proxies;
and


 


(E)           the Note Assignment Agreement
together with all intercompany notes in substantially the form of Exhibit G
hereto (each an “Intercompany Note” and collectively, the “Intercompany
Notes”) made by the Borrower’s Subsidiaries payable to the Borrower and
duly endorsed to the Administrative Agent.


 


(iii)          Subject to Section 5.16:


 


(A)          mortgages or appropriate amendments to
any existing Mortgages duly executed by the applicable Loan Party for each
Mortgaged Property listed on Schedule 4.21, together with evidence
that counterparts of the Mortgages or amendments have been delivered to a title
insurance company (reasonably acceptable to the Lenders) insuring the Lien of
the Mortgages or amendments for recording in all places to the extent necessary
or desirable, in the reasonable judgment of the Lenders, to create a valid and
enforceable first priority lien on each Mortgaged Property listed on Schedule 4.21
(subject only to Permitted Real Property Encumbrances) in favor of the
Administrative Agent (or a trustee acting on behalf of the Administrative Agent
required or desired under local law) for the benefit of the Secured Parties;


 


(B)           mortgagee title insurance policies or
appropriate endorsements to any existing title insurance policies (or binding
commitments to issue such title insurance policies or endorsements) which shall
(1) be issued to the Administrative Agent for the benefit of the Secured
Parties by title insurance companies reasonably satisfactory to the
Administrative Agent (the “Mortgage Policies”) in amounts reasonably
satisfactory to the Administrative Agent


 


48





















 


insuring
that the Mortgages are valid and enforceable first priority mortgage liens on
the respective Mortgaged Properties, free and clear of all defects,
encumbrances and other Liens except Permitted Real Property Encumbrances, (2) be
in form and substance reasonably satisfactory to the Administrative Agent (3) include,
as appropriate, an endorsement for future advances under this Agreement, the
Notes and the Mortgages and such other endorsements that the Administrative
Agent in its discretion may reasonably request, (4) not include an
exception for mechanics’ liens, and (5) provide for affirmative insurance
and such reinsurance (including direct access agreements) as the Administrative
Agent in its discretion may reasonably request; and


 


(C)           surveys, in form and substance
satisfactory to the Administrative Agent, of each Mortgaged Property listed on Schedule 4.21,
reasonably acceptable to the Administrative Agent and sufficient to delete any
standard printed survey exception which otherwise would be contained in the
Mortgage Policies, certified by a licensed professional surveyor in a manner
satisfactory to the Administrative Agent for the benefit of the Lenders.


 


(iv)          The Intellectual Property Security
Agreement, duly executed by each Loan Party, together with evidence that all
action that the Administrative Agent may deem necessary or desirable in order
to perfect and protect the first and only priority Liens and security interests
created under the Intellectual Property Security Agreement has been taken.


 


(v)           The Subsidiary Guaranty, duly
executed by each Domestic Subsidiary of the Borrower.


 


(vi)          Originals or facsimiles (followed
promptly by originals) of the following, each in form and substance reasonably
satisfactory to the Administrative Agent and its legal counsel:


 


(A)          copies of the certificate or articles
of incorporation and bylaws (or equivalent or comparable constitutive documents
in the case of any Person that is not a corporation) of each Loan 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 incorporation
or organization, where applicable, and certified by a secretary or assistant
secretary of such Loan Party to be true and correct as of the Closing Date;


 


(B)           such certificates of resolutions or
other action, incumbency certificates and/or other certificates of Responsible
Officers of each Loan Party as the Administrative Agent may require evidencing
the identity, authority and capacity of each Responsible Officer thereof
authorized to act as a Responsible Officer in connection with this Agreement
and the other Loan Documents to which such Loan Party is a party; and


 


(C)           subject to Section 5.16,
such documents and certifications as the Administrative Agent may reasonably
require to evidence that each Loan Party is duly organized or formed, and is
validly existing, in good standing and qualified to engage in business in its
state of organization or formation.


 


49





















 


(vii)         (A) Audited annual financial
statements of (1) the Borrower and its Consolidated Subsidiaries for the
Fiscal Years ended July 31, 2003 and July 31, 2004 and (2) Crosstex
for the fiscal years ended April 30, 2003, April 30, 2004 and April 30,
2005 (which 2005 audit shall be accompanied by an unqualified opinion of the
auditors, which may be in draft form), (B) interim financial statements
dated the end of the most recent fiscal quarter for which financial statements
are available and (C) pro forma financial statements as to each of the
Loan Parties and forecasts prepared by management of the Borrower, all in form
and substance reasonably satisfactory to the Lenders.


 


(viii)        A Notice of Borrowing with respect to
each Facility pursuant to which the Borrower shall request an Initial Extension
of Credit.


 


(b)           All necessary governmental and third
party approvals (which third party approvals are material) and compliance with
all laws, including ERISA, except to the extent that failure by the Borrower,
Crosstex or their Subsidiaries in connection with the operations of their
business to comply with laws would not have or would not reasonably be expected
to have a Material Adverse Effect (excluding for purposes of this exception the
consummation of the Crosstex Acquisition and financing transaction contemplated
herein).


 


(c)           The Borrower shall have delivered a
certificate, in form and substance reasonably satisfactory to the
Administrative Agent, attesting to the Solvency of the Borrower immediately
before and immediately after giving effect to the Transaction, from its
president or a vice president.


 


(d)           Subject to Section 5.16,
the Administrative Agent shall have received endorsements naming the
Administrative Agent, on behalf of the Lenders, as loss payee or an additional
insured, as applicable,  under all
insurance policies to be maintained with respect to the properties of the
Borrower and its Subsidiaries (including Crosstex) forming any part of the
Collateral under the Security Agreement and the other Collateral Documents.


 


(e)           There shall exist no Default under
any of the Loan Documents.


 


(f)            The Borrower shall have paid to
Administrative Agent and the Lenders all fees required to be paid on or before
the Closing Date, and the Borrower shall have paid all fees, charges and
disbursements of counsel to the Administrative Agent to the extent invoiced
prior to or on the Closing Date.


 


(g)           The Crosstex Acquisition shall have
been, or shall be concurrently, consummated pursuant to the terms and
conditions of the Purchase Agreements and in accordance with applicable law,
and otherwise on terms reasonably satisfactory to the Administrative Agent. The
Purchase Agreements shall not have been materially altered, amended or
otherwise changed or supplemented in any material respect or any material
condition therein waived, without the prior written consent of the
Administrative Agent.  The Administrative
Agent shall have received certified copies of each of the Crosstex Acquisition  Documents, each of which shall be satisfactory
to the Lenders and in full force and effect.


 


(h)           After giving effect to the Initial
Extensions of Credit, there shall be at least $4,000,000 of Revolving Credit
Availability.


 


50





















 


(i)            The absence of any material adverse
change in the condition (financial or otherwise), operations, business,
properties and/or prospects of (i) the Borrower and its Subsidiaries,
taken as a whole, since July 31, 2004 and (ii) Crosstex, since April 30,
2005.


 


(j)            The Administrative Agent shall have
received opinions of legal counsel to the Loan Parties in form and substance
reasonably satisfactory to it.


 


(k)           There shall be no litigation or
administrative proceedings or other legal or regulatory developments actual or
threatened that would be reasonably expected to result in a Material Adverse
Effect on (a) the condition (financial or otherwise), business,
properties, operations, or prospects since July 31, 2004, in respect of
the Borrower and its Subsidiaries and since April 30, 2005, in respect of
Crosstex or (b) on the rights and remedies of the Administrative Agent or
on the ability of the Borrower and its Subsidiaries (including Crosstex) to
perform their obligations.


 


Section 3.2            Conditions Precedent to Each
Borrowing and Issuance.


 


The
obligation of each appropriate Lender to make an Advance (other than a Letter
of Credit Advance made by the Issuing Bank or a Revolving Credit Lender
pursuant to Section 2.3(c) and a Swing Line Advance made by a
Revolving Credit Lender pursuant to Section 2.2(b)), and the
obligation of the Issuing Bank to issue a Letter of Credit (including the
initial issuance thereof) or renew a Letter of Credit and the right of the
Borrower to request the issuance or renewal of a Letter of Credit shall each be
subject to the further conditions precedent that on the date of each such
Borrowing or issuance or renewal:


 


(a)           Each of the conditions precedent
listed in Section 3.1 shall have been previously or concurrently
satisfied in accordance with this Agreement.


 


(b)           The following statements shall be
true (and each of the giving of the applicable Notice of Borrowing, Notice of
Swing Line Borrowing, or Letter of Credit Application and the acceptance by the
Borrower of the proceeds of a Borrowing or of a Letter of Credit or the renewal
of a Letter of Credit shall constitute a representation and warranty by the
Borrower that both on the date of such notice and on the date of such Borrowing
or issuance or renewal such statements are true):


 


(i)            the representations and warranties
contained in each Loan Document are correct in all material respects on and as
of such date, before and after giving effect to such Borrowing or issuance or
renewal and to the application of the proceeds therefrom, as though made on and
as of such date, other than any such representations or warranties that, by
their terms, refer to a specific date other than the date of such Borrowing,
issuance or renewal, in which case, as of such specific date;


 


(ii)           no event has occurred and is continuing,
or would result from such Borrowing or issuance or renewal or from the
application of the proceeds therefrom, that constitutes a Default;


 


(iii)          for each Revolving Credit Advance,
Swing Line Advance made by the Swing Line Bank or issuance or renewal of any
Letter of Credit, the outstanding amount of the Revolving Credit Advances shall
not be in excess of the remaining Revolving Credit Availability after giving
effect to any such Advance or issuance or renewal, respectively; and


 


51





















 


Section 3.3            Determinations Under Section 3.1.


 


For
purposes of determining compliance with the conditions specified in Section 3.1,
each Lender shall be deemed to have consented to, approved or accepted or to be
satisfied with each document or other matter required thereunder to be
consented to or approved by or acceptable or satisfactory to the Lenders unless
an officer of the Administrative Agent responsible for the transactions
contemplated by the Loan Documents shall have received written notice from such
Lender prior to the Initial Extension of Credit specifying its objection
thereto and, if the Initial Extension of Credit consists of a Borrowing, such
Lender shall not have made available to the Administrative Agent such Lender’s
ratable portion of such Borrowing.


 


ARTICLE IV


 


REPRESENTATIONS AND WARRANTIES
OF THE BORROWER


 


The
Borrower represents and warrants as follows:


 


Section 4.1            Organization.


 


Each
Loan Party (a) is 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 in each other jurisdiction in which it owns or
leases property or in which the conduct of its business requires it to so
qualify or be licensed except where the failure to so qualify or be licensed
could not reasonably be expected to have a Material Adverse Effect and (c) has
all requisite organizational power and authority (including, without
limitation, all governmental licenses, permits and other approvals) to own or
lease and operate its properties and to carry on its business as now conducted
and as proposed to be conducted.


 


Section 4.2            Subsidiaries.


 


Set
forth on Schedule 4.2 hereto is a complete and accurate list of all
Subsidiaries of each Loan Party as of the Closing Date, showing (as to each
such Subsidiary) the jurisdiction of its organization, the number of shares of
each class of capital stock or other equity interests authorized, and the
number outstanding, on the Closing Date and the percentage of the outstanding
shares of each such class owned (directly or indirectly) by such Loan Party and
the number of shares covered by all outstanding options, warrants, rights of
conversion or purchase and similar rights at the Closing Date.  All of the outstanding capital stock or other
equity interests of all of such Subsidiaries has been validly issued, is fully
paid and non-assessable and is owned by such Loan Party or one or more of its
Subsidiaries free and clear of all Liens, except those created under the
Collateral Documents.


 


Section 4.3            Corporate Power, Authorization.


 


The
execution, delivery and performance by each Loan Party of this Agreement, the
Notes, each other Loan Document and each Crosstex Acquisition Document to which
it is or is to be a party, and the consummation of the Transaction, are within
such Loan Party’s powers, have been duly authorized by all necessary action,
and do not (a) contravene such Loan Party’s charter, bylaws or equivalent
or comparable constitutive documents,  (b) violate
any law (including, without limitation, the Securities Act of 1933, as amended,
the Securities Exchange Act of 1934, as amended, and the Racketeer Influenced
and Corrupt Organizations Chapter of the Organized Crime Control Act of 1970),
rule, regulation (including, without limitation, Regulation T, U or X
of the Board of Governors of the Federal Reserve System), order, writ,
judgment, injunction, decree, determination or award, (c) conflict with or
result in the breach of, or constitute a default under, any loan agreement,
indenture, mortgage, deed of trust, lease or other material


 


52





















 


contract, instrument or
agreement binding on or affecting any Loan Party, any of its Subsidiaries or
any of their respective properties or (d) except for the Liens created
under the Collateral Documents, result in or require the creation or imposition
of any Lien upon or with respect to any of the properties of any Loan Party or
any of its Subsidiaries.  No Loan Party
or any of its Subsidiaries is in violation of any such law, rule, regulation,
order, writ, judgment, injunction, decree, determination or award or in breach
of any such contract, loan agreement, indenture, mortgage, deed of trust, lease
or other instrument or agreement, the violation or breach of which could
reasonably be expected to have a Material Adverse Effect.


 


Section 4.4            Governmental Authorizations,
Approvals.


 


Other
than those which have been obtained or made, no authorization or approval or
other action by, and no notice to or filing with, any governmental authority or
regulatory body or any other third party is or was required, for (a) the
due execution, delivery, recordation, filing or performance by any Loan Party
of this Agreement, the Notes, any other Loan Document or any Crosstex
Acquisition Document to which it is or is to be a party, or for the
consummation of the Transaction, (b) the grant by any Loan Party of the
Liens granted by it pursuant to the Collateral Documents, (c) the
perfection or maintenance of the Liens created by the Collateral Documents or (d) the
exercise by the Administrative Agent or any Lender Party of its rights under
the Loan Documents or the remedies in respect of the Collateral pursuant to the
Collateral Documents.  All applicable
waiting periods in connection with the Transaction have expired without any
action having been taken by any competent authority restraining, preventing or
imposing materially adverse conditions upon the Transaction or the rights of
the Loan Parties or their Subsidiaries freely to transfer or otherwise dispose
of, or to create any Lien on, any properties now owned or hereafter acquired by
any of them.


 


Section 4.5            Due Execution, Validity,
Enforceability.


 


This
Agreement and each Crosstex Acquisition Document has been, and each of the
Notes and each other Loan Document has been or when delivered hereunder will
have been, duly executed and delivered by each Loan Party party thereto.  This Agreement and each Crosstex Acquisition
Document is, and each of the Notes and each other Loan Document has been or
when delivered hereunder will be, the legal, valid and binding obligation of
each Loan Party party thereto, enforceable against such Loan Party in
accordance with its terms.


 


Section 4.6            Financial Statements; Material
Adverse Change.


 


(a)           The
consolidated and consolidating balance sheets of the Borrower and its
Subsidiaries as at July 31, 2004, and the related consolidated and
consolidating statements of income and consolidated statement of cash flows of
the Borrower and its Subsidiaries for the Fiscal Year then ended, accompanied
by (in the case of such Consolidated financial statements) an opinion of Ernst &
Young LLP, independent auditors, and the Consolidated balance sheet of the
Borrower and its Subsidiaries as at April 30, 2005, and the related
Consolidated statement of income and Consolidated statement of cash flows of
the Borrower and its Subsidiaries for the period then ended, duly certified by
the president or a vice president of the Borrower, fairly present, subject, in
the case of said balance sheet as at April 30, 2005, and said statements
of income and cash flows for the period then ended, to year-end type
adjustments, the Consolidated (and, with respect to the balance sheet dated July 31,
2004, consolidating) financial condition of the Borrower and its Subsidiaries
as at such dates and the Consolidated (and, with respect to the statement of
income dated July 31, 2004, consolidating) results of the operations of
the Borrower and its Subsidiaries for the periods ended on such dates, all in
accordance with GAAP applied on a consistent basis, and, since July 31,
2004, there has been no Material Adverse Change; and


 


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(b)           The consolidated balance sheet of
Crosstex as at April 30, 2005, and the related consolidated statement of
income and consolidated statement of cash flows of Crosstex for the Fiscal Year
then ended, accompanied by an opinion of McGladrey & Pullen, LLP,
independent public accountants, fairly present the Consolidated financial
condition of Crosstex as at such date and the Consolidated results of the
operations of Crosstex for the period ended on such date, all in accordance
with GAAP applied on a consistent basis, and, since April 30, 2005, there
has been no Material Adverse Change.


 


Section 4.7            Pro Forma Historical Financial
Statements.


 


The
Consolidated pro forma balance sheet of the Borrower and its Subsidiaries and
Crosstex as at April 30, 2005, and the related Consolidated pro forma statement
of income of the Borrower and its Subsidiaries and Crosstex for the nine month
period ended April 30, 2005, fairly present the Consolidated pro forma
financial condition of the Borrower and its Subsidiaries and Crosstex as at
such date and the Consolidated pro forma results of operations of the Borrower
and its Subsidiaries and Crosstex for the nine month period ended on such date,
in each case after giving effect to the Transaction.


 


Section 4.8            Accurate
Information.


 


None
of the information, exhibits or reports furnished by any Loan Party to the
Administrative Agent or any Lender Party in connection with the Loan Documents
or pursuant to the terms of the Loan Documents contained any untrue statement
of a material fact or omitted to state a material fact necessary to make the
statements made therein not misleading.


 


Section 4.9            Litigation.


 


Other
than the litigation disclosed on Schedule 4.9 (the “Disclosed
Litigation”), there is no action, suit, investigation, litigation or
proceeding affecting the Borrower, any other Loan Party or any of their
respective Subsidiaries, including, without limitation, any Environmental
Action, pending or threatened before any court, governmental agency or
arbitrator that could reasonably be expected to have a Material Adverse Effect,
and there has been no Material Adverse Change in the status, or financial
effect on any Loan Party or any of its Subsidiaries, of the Disclosed
Litigation from that described on Schedule 4.9.


 


Section 4.10         Regulation U.


 


Neither
the Borrower nor any other Loan Party nor any of their respective Subsidiaries
is engaged in the business of extending credit for the purpose of purchasing or
carrying Margin Stock.


 


Section 4.11         ERISA.


 


(a)           Except
as set forth on Schedule 4.11 hereto, neither the Borrower nor any
of its ERISA Affiliates maintains or has maintained any Plans or Multiemployer
Plans.  Set forth on Schedule 4.11
is a complete and accurate list of all Welfare Plans and all defined
contribution plans in respect of which any Loan Party could have liability.


 


(b)           Except
as set forth in the financial statements referred to in this Section 4.6
and in Article VII, neither the Borrower, any of the other Loan
Parties nor any of their respective Subsidiaries has any material liability
with respect to “expected post retirement benefit obligations” within the
meaning of Statement of Financial Accounting Standards No. 106.


 


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Section 4.12         Casualty.


 


Neither
the business nor the properties of any Loan Party or any of its Subsidiaries
are affected by any fire, explosion, accident, strike, lockout or other labor
dispute, drought, storm, hail, earthquake, embargo, act of God or of the public
enemy or other casualty (whether or not covered by insurance) that could
reasonably be expected to have a Material Adverse Effect.


 


Section 4.13         Environmental
Matters.


 


(a)           The
operations and properties of each Loan Party and each of its Subsidiaries
comply in all material respects with all applicable Environmental Laws and
Environmental Permits, all known past non-compliance with such Environmental
Laws and Environmental Permits has been resolved without ongoing obligations or
costs, and no circumstances exist that could reasonably be expected to (i) form
the basis of an Environmental Action against any Loan Party or any of its
Subsidiaries or any of their properties that could reasonably be expected to
have a Material Adverse Effect or (ii) cause any such property to be
subject to any material restrictions on ownership, occupancy, use or
transferability under any Environmental Law.


 


(b)           Except
as disclosed on, or in the environmental assessment reports listed on, Schedule 4.13
hereto, (i) none of the properties currently or formerly owned or operated
by any Loan Party or any of its Subsidiaries is listed or proposed for listing
on the NPL or on the CERCLIS or any analogous foreign, state or local list or
is adjacent to any such property; (ii) there are no and, to the best of
its knowledge, never have been any underground or aboveground storage tanks or
any surface impoundments, septic tanks, pits, sumps or lagoons in which
Hazardous Materials are being or, to the best of its knowledge, have been
treated, stored or disposed on any property currently owned or operated by any Loan
Party or any of its Subsidiaries or on any property formerly owned or operated
by any Loan Party or any of its Subsidiaries; (iii) there is no asbestos
or asbestos-containing material on any property currently owned or operated by
any Loan Party or any of its Subsidiaries; and (iv) Hazardous Materials
have not been released, discharged or disposed of on any property currently
owned or operated by any Loan Party or any of its Subsidiaries, or any property
formerly owned or operated by any Loan Party or any of its Subsidiaries.


 


(c)           Except
as disclosed on, or in the environmental assessment reports listed on, Schedule 4.13,
no Loan Party or any of its Subsidiaries is undertaking or has not completed,
either individually or together with other potentially responsible parties, any
investigation or assessment or Remedial, Response or Removal action relating to
any actual or threatened release, discharge or disposal of Hazardous Materials
at any site, location or operation, either voluntarily or pursuant to the order
of any governmental or regulatory authority or the requirements of any
Environmental Law; and all Hazardous Materials generated, used, treated,
handled or stored at, or transported to or from, any property currently owned
or operated by any Loan Party or any of its Subsidiaries or any property
formerly owned or operated by any Loan Party or any of its Subsidiaries have
been disposed of in a manner not reasonably expected to result in material
liability to any Loan Party or any of its Subsidiaries.


 


Section 4.14         Burdensome
Documents.


 


Except
as set forth on Schedule 4.14, no Loan Party nor any of its
Subsidiaries is a party to any indenture, loan or credit agreement or any lease
or other agreement or instrument or subject to any charter or corporate restriction
that could reasonably be expected to have a Material Adverse Effect.


 


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Section 4.15         Priority
of Liens.


 


The
Collateral Documents create in favor of the Administrative Agent, for the
ratable benefit of the Secured Parties, a valid and, upon either the filing by
the Administrative Agent or its representative of the proper financing
statements referred to in Section 3.1(a)(ii) hereof or the
taking of possession of appropriate collateral, perfected first priority
security interest in the Collateral (other than Permitted Liens) securing the
payment of the Obligations.  The Loan
Parties are the legal and beneficial owners of the Collateral free and clear of
any Lien, except for the Liens and security interests created or expressly
permitted under the Loan Documents.


 


Section 4.16         Taxes.


 


(a)           Each
Loan Party and each of its Subsidiaries has filed, has caused to be filed or
has been included in all tax returns (Federal, state, local and foreign)
required to be filed and has paid all taxes shown thereon to be due, together
with applicable interest and penalties.


 


(b)           Set
forth on Schedule 4.16(b) is a complete and accurate list of
each taxable year of each Loan Party and each of its Subsidiaries for which
Federal income tax returns have been filed and for which the expiration of the
applicable statute of limitations for assessment or collection has not occurred
by reason of extension or otherwise (an “Open Year”).


 


(c)           Other
than as disclosed on Schedule 4.16(c), there is no unpaid amount of
adjustments to the Federal income tax liability of any Loan Party or any of its
Subsidiaries proposed by the Internal Revenue Service with respect to Open
Years.  No issues have been raised by the
Internal Revenue Service in respect of Open Years that, in the aggregate, could
reasonably be expected to have a Material Adverse Effect.


 


(d)           Other
than as disclosed on Schedule 4.16(d), there is no unpaid amount of
adjustments to the state, local and foreign tax liability of each Loan Party
and each of its Subsidiaries proposed by any state, local or foreign taxing
authorities (other than amounts arising from adjustments to Federal income tax
returns).  No issues have been raised by
such taxing authorities that, individually or in the aggregate, could
reasonably be expected to have a Material Adverse Effect.


 


(e)           Except
as disclosed on Schedule 4.16(e), no “ownership change” as defined
in Section 382(g) of the Internal Revenue Code, and no event that
would result in the application of the “separate return limitation year” or “consolidated
return change of ownership” limitations under the Federal income tax
consolidated return regulations, has occurred with respect to any Loan Party.


 


Section 4.17         Compliance with Securities Laws.


 


No
Loan Party and none of any Loan Party’s Subsidiaries is an “investment company,”
or an “affiliated person” of, or “promoter” or “principal underwriter” for, an “investment
company,” as such terms are defined in the Investment Company Act of 1940, as
amended.  Neither the making of any
Advances, nor the issuance of any Letters of Credit, nor the application of the
proceeds or repayment thereof by the Borrower, nor the consummation of the
Transaction, will violate any provision of such Act or any rule, regulation or
order of the Securities and Exchange Commission thereunder or any takeover,
disclosure or other federal, state or foreign securities law or
Regulations T, U or X of the Federal Reserve Board.  The Borrower is not subject to regulation
under any federal, state or foreign statute or regulation which limits its
ability to incur Debt.


 


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Section 4.18         Solvency.


 


Each
Loan Party is, individually and together with its Subsidiaries, Solvent.


 


Section 4.19         Debt.


 


Set
forth on Schedule 4.19 is a complete and accurate list of all Debt
of the Borrower and its Subsidiaries the principal amount of which is greater
than $100,000, which Debt shall remain outstanding after giving effect to the
transactions contemplated hereby, showing as of the Closing Date the principal
amount outstanding thereunder, the maturity date thereof and the amortization schedule therefor.


 


Section 4.20         No Defaults, Compliance with Laws.


 


(a)           Except
as set forth on Schedule 4.20 hereto, no Loan Party is in default
under any agreement, ordinance, resolution, decree, bond, note, indenture,
order or judgment to which it is a party or by which it is bound, or any other
agreement or other instrument by which any of the properties or assets owned by
it or used in the conduct of its business is affected, which default could have
a Material Adverse Effect.


 


(b)           Each
Loan Party and, to our knowledge, each officer, director, employee or
contractor of any of the foregoing (in so far as related to services provided
in respect of the Borrower or any Subsidiary by any such officer, director,
employee or contractor) has complied and is in compliance in all respects with
all applicable laws, ordinances, regulations, resolutions, decrees and other
similar documents and instruments of all courts and governmental authorities,
bureaus and agencies, domestic and foreign and all applicable Environmental
Laws and Regulations, non-compliance with which could have a Material Adverse
Effect.


 


Section 4.21         Owned
Real Property.


 


Set
forth on Schedule 4.21 is a complete and accurate list of all real
property owned by any Loan Party or any of its Subsidiaries as of the Closing
Date (each a “Mortgaged Property” and, collectively, the “Mortgaged
Properties”), showing the street address, county or other relevant
jurisdiction, state and record owner thereof. 
Such Loan Party or such Subsidiary has good, marketable and insurable
fee simple title to such Mortgaged Property, free and clear of all Liens, other
than Permitted Real Property Encumbrances. 
The Mortgages create, as security for the obligations purported to be
secured thereby, a valid and enforceable perfected security interest in and
Lien on all of the Mortgaged Property (and will create a valid and enforceable
perfected security interest in and Lien on all fixtures and improvements
related to such Mortgaged Property and affixed or added thereto on or after the
Closing Date) in favor of the Administrative Agent (or such other trustees that
may be named therein) for the benefit of the Secured Parties, superior to and
prior to the rights of all third Persons (except that the security interest
created in the Mortgaged Property may be subject to the Permitted Real Property
Encumbrances related thereto) and subject to no other Liens (other than
Permitted Real Property Encumbrances).


 


Section 4.22         Leased
Real Property.


 


Set
forth on Schedule 4.22 is a complete and accurate list of all
leases of real property under which any Loan Party or any of its Subsidiaries
is the lessee as of the Closing Date, showing the street address, county or
other relevant jurisdiction, state, lessor, lessee, expiration date and annual
rental cost thereof.  To the best
knowledge of each Loan Party, each such lease is the legal, valid and binding
obligation of the lessor thereof, enforceable in accordance with its
terms.  There exists no material default
by the Borrower or any of its Subsidiaries party thereto under any lease set
forth on Schedule 4.22 and, to


 


57





















 


the best knowledge of each Loan
Party, there exists no material default under any lease set forth on Schedule 4.22
by any other party thereto.


 


Section 4.23         Material
Contracts.


 


Set
forth on Schedule 4.23 is a complete and accurate list of all
Material Contracts of each Loan Party and its Subsidiaries as of the Closing
Date, showing the parties, subject matter and term thereof.  Except as could not reasonably be expected to
have a Material Adverse Effect, each such Material Contract has been duly authorized,
executed and delivered by all parties thereto, has not been amended or
otherwise modified, is in full force and effect and is binding upon and
enforceable against all parties thereto in accordance with its terms.  There exists no material default under any
Material Contract by the Borrower or any of its Subsidiaries party thereto and,
to the best knowledge of each Loan Party, there exists no default under any
Material Contract by any other party thereto.


 


Section 4.24         Investments.


 


Set
forth on Schedule 4.24 is a complete and accurate list of all
Investments in excess of $250,000 held by any Loan Party or any of its
Subsidiaries as of the Closing Date, showing the amount, obligor or issuer and
maturity, if any, thereof.


 


Section 4.25         Intellectual
Property.


 


Set
forth on Schedule 4.25 is a complete and accurate list of all U.S.
or Canadian registered patents, trademarks, trade names, service marks and
copyrights, and all applications therefor and licenses thereof, of each Loan
Party as of the Closing, showing the jurisdiction in which registered, the
registration number, the date of registration and the expiration date.  Each Loan Party and each of their respective
Subsidiaries owns or has rights to use all patents, trademarks, trade names,
service marks, copyrights and other intellectual property necessary to conduct
its business as now or heretofore conducted by it or proposed to be conducted
by it.  Each Loan Party and each of their
respective Subsidiaries conducts its business and affairs without infringement
of or interference with any patent, trademark, trade name, service mark,
copyright or other intellectual property of any other Person.  The Intellectual Property Security Agreement
creates, as security for the obligations purported to be secured thereby, a
valid and enforceable, and upon filing in the appropriate office, perfected
security interest in and Lien on all of the Collateral purported to be covered
thereby in favor of the Administrative Agent for the benefit of the Secured
Parties, superior to and prior to the rights of all third Persons.


 


Section 4.26         Crosstex Acquisition Documents.


 


Each
Crosstex Acquisition Document to which any Loan Party or any of its respective
Subsidiaries is a party has been duly executed and delivered by such Loan Party
or such Subsidiary, as the case may be, and, to the best knowledge of the
Borrower, each Crosstex Acquisition Document has been duly executed and
delivered by the parties thereto other than the Borrower and its Subsidiaries,
and is in full force and effect.  The
representations and warranties of any Loan Party and each of its respective
Subsidiaries contained in each Crosstex Acquisition Document to which such Loan
Party or such Subsidiary, as the case may be, is a party are true and correct
in all material respects on the Closing Date and will be true and correct in
all material respects on the Closing Date, as if made on each of such dates,
and the Administrative Agent and each Lender Party shall be entitled to rely
upon such representations and warranties with the same force and effect as if
they were incorporated in this Agreement and made to the Administrative Agent
and each Lender Party directly as of the Closing Date, the Closing Date.


 


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Section 4.27         Fees.


 


No
broker’s or finder’s fees or commissions or any similar fees or commissions
will be payable by any Loan Party or any of its Subsidiaries with respect to
the incurrence and maintenance of the Obligations, any other transaction
contemplated by the Loan Documents or any services rendered in connection with
any such transactions other than fees paid in connection with the Crosstex
Acquisition.  The Borrower hereby
covenants and agree to indemnify the Administrative Agent and each Lender Party
against and hold the Administrative Agent and each Lender Party harmless from
any claim, demand or liability for broker’s or finder’s fees or similar fees or
commissions.


 


Section 4.28         Repatriation of Earnings of
Foreign Subsidiaries.


 


Foreign
Subsidiaries of the Borrower have deposited earnings in an amount sufficient to
repay the Interim Term Facility in full into a deposit account or other
accounts permitted pursuant to the Loan Documents (or shall have otherwise been
invested in Cash Equivalents or other similar instruments reasonably acceptable
to the Administrative Agent) pending the repatriation of such earnings to the
Borrower.


 


A
disclosure made by the Borrower in any Schedule to this Agreement that is
sufficient to reasonably inform the reader with respect to information required
to be disclosed in another Schedule to this Agreement in order to avoid a
misrepresentation thereunder shall be deemed to have been made with respect to
such other Schedule.


 


ARTICLE V


 


AFFIRMATIVE COVENANTS


 


So
long as any Advance shall remain unpaid, any Letter of Credit shall be
outstanding or any Lender Party shall have any Commitment hereunder, the
Borrower will:


 


Section 5.1            Compliance
with Law.


 


Comply,
and cause each of its Subsidiaries to comply, in all material respects, with
all applicable laws, rules, regulations and orders, such compliance to include,
without limitation, compliance with ERISA.


 


Section 5.2            Payment
of Taxes, Etc.


 


Timely
pay and discharge, and cause each of its Subsidiaries to timely pay and discharge,
(a) all taxes, assessments and governmental charges or levies imposed upon
it or upon its property and (b) all lawful claims that, if unpaid, might
by law become a Lien upon its property; provided, however, that
the Borrower and its Subsidiaries shall not be required to pay or discharge any
such tax, assessment, charge or claim that is being contested in good faith and
by proper proceedings and as to which appropriate reserves are being
maintained, unless and until any Lien resulting therefrom attaches to its
property and becomes enforceable against the Borrower or any of its
Subsidiaries.


 


Section 5.3            Compliance with Environmental Laws.


 


Comply,
and cause each of its Subsidiaries and all lessees and other Persons operating
or occupying its properties to comply, in all material respects, with all
applicable Environmental Laws and


 


59





















 


Environmental Permits; obtain
and renew and cause each of its Subsidiaries to obtain and renew all
Environmental Permits reasonably necessary for its operations and properties;
and conduct, and cause each of its Subsidiaries to conduct, any investigation,
study, sampling and testing, and undertake any Removal, Remedial or other
Response action necessary to remove and clean up all Hazardous Materials from
any of its properties, in accordance with the requirements of all Environmental
Laws; provided, however, that the Borrower and its Subsidiaries
shall not be required to undertake any such cleanup, Removal, Remedial or
Response action to the extent that its obligation to do so is being contested
in good faith and by proper proceedings and adequate reserves as determined by
the Administrative Agent are being maintained with respect to such
circumstances.


 


Section 5.4            Preparation of Environmental
Reports.


 


The
Borrower agrees that the Required Lenders may, upon reasonable prior notice,
from time to time in their reasonable discretion, retain an independent
professional consultant to prepare environmental site assessment reports for the
Borrower or any of its Subsidiaries and/or to review any report relating to
Hazardous Materials prepared by or for the Borrower, the cost of which shall be
paid fifty (50%) by the Borrower and fifty percent (50%) ratably by
the Lenders provided, that, if a Default has occurred and is
continuing all such costs shall be at the Borrower’s sole expense and, upon a
reasonable belief that the Borrower or any of its Subsidiaries has breached any
covenant or representation with respect to environmental matters or that there
has been a material violation of Environmental Laws by the Borrower or one of
its Subsidiaries, the Administrative Agent may conduct its own investigation of
such matter at any facility or property currently owned, leased, operated or
used by the Borrower or one of its Subsidiaries and the Borrower agrees to use
their best efforts to obtain permission for the Administrative Agent’s
professional consultant to conduct its own investigation of any such matter at
any facility or property previously owned, leased, operated or used by the
Borrower or one of its Subsidiaries.  The
Borrower and its Subsidiaries hereby grant to the Administrative Agent, its
employees, consultants and contractors, the right to enter into or onto the
facilities or properties currently owned, leased, operated or used by the
Borrower or its Subsidiaries upon reasonable notice to the Borrower to perform
such assessments on such property as are necessary to conduct such a review
and/or investigation.  Any such
investigation of any such facility or property shall be conducted, unless
otherwise agreed to by the Borrower and the Administrative Agent, during normal
business hours and, to the extent reasonably practicable, shall be conducted so
as not to interfere with the ongoing operations at any facility or property or
to cause any damage or loss to any facility or property.  The Borrower and the Administrative Agent
hereby acknowledge and agree that any report of any investigation conducted at
the request of the Administrative Agent will be obtained and shall be used by
the Administrative Agent and Lender Parties for the purpose of internal credit
decisions to monitor and police the Advances and/or protect the Administrative
Agent’s and Lender Parties’ security interests in the Collateral.  The Administrative Agent agrees  to deliver a copy of any such report to the
Borrower with the understanding that the Borrower acknowledges and agrees that (i) the
Borrower will indemnify and hold harmless the Administrative Agent and each
Lender Party from any costs, losses or liabilities relating to the Borrower’s
use of or reliance on such report and (ii) neither the Administrative
Agent nor any Lender Party makes any representation or warranty with respect to
such report.


 


Section 5.5            Maintenance
of Insurance.


 


Maintain,
and cause each of its Subsidiaries to maintain, insurance with responsible and
reputable insurance companies or associations in such amounts and covering such
risks as is usually carried by companies engaged in similar businesses and
owning similar properties in the same general areas in which the Borrower or
such Subsidiary operates.


 


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Section 5.6            Preservation of Existence, Etc.


 


Except
with respect to Carsen and as permitted by Section 6.4, preserve
and maintain, and cause each of its Subsidiaries to preserve and maintain, its
existence, legal structure, legal name, rights (charter and statutory),
permits, licenses, approvals, privileges and franchises.


 


Section 5.7            Visitation
Rights.


 


(a)           At
any reasonable time and from time to time during normal business hours, upon
reasonable notice, permit the Administrative Agent or the Lender Parties, or
any agents or representatives thereof, to examine and make copies of and
abstracts from the records and books of account of and visit the properties of
the Borrower and its Subsidiaries, and to discuss the affairs, finances and
accounts of the Borrower and any such Subsidiaries with any of their officers
or directors in a manner that does not unreasonably interfere with normal
operations.


 


(b)           Permit
the Administrative Agent and the Lender Parties to conduct on a semi-annual
basis, at the sole cost and expense of the Borrower (which cost and expense
shall not exceed $10,000 per audit) such commercial finance examinations and/or
Collateral audits as the Administrative Agent may reasonably request.


 


Section 5.8            Keeping
of Books.


 


Keep,
and cause each of its Subsidiaries to keep, proper books of record and account,
in which full and correct entries shall be made of all financial transactions
and the assets and business of the Borrower and each Subsidiary in accordance
with GAAP.


 


Section 5.9            Maintenance of Properties, Etc.


 


Maintain
and preserve, and cause each of its Subsidiaries to maintain and preserve, all
of its properties that are reasonably necessary in the conduct of its business
in good working order and condition, ordinary wear and tear excepted.


 


Section 5.10         Compliance with Terms of Leaseholds.


 


Make,
and cause each of its Subsidiaries to make, all payments and otherwise perform
all obligations in respect of all leases of real property to which the Borrower
or any of its Subsidiaries is a party, keep such leases in full force and
effect and not allow such leases to lapse or be terminated or any rights to
renew such leases to be forfeited or canceled, notify the Administrative Agent
of any default by any party with respect to such leases and cooperate with the
Administrative Agent in all respects to cure any such default, and cause each of
its Subsidiaries to do so except, in any case, where the failure to do so,
either individually or in the aggregate, could not reasonably be expected to
have a Material Adverse Effect.


 


Section 5.11         Performance of Material Contracts.


 


Perform
and observe, and cause each of its Subsidiaries to perform and observe, all of
the terms and provisions of each Material Contract to be performed or observed
by it, maintain, and cause each of its Subsidiaries to maintain,  each such Material Contract in full force and
effect, and enforce, and cause each of its Subsidiaries to enforce, each such
Material Contract in accordance with its terms.


 


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Section 5.12         Transactions
with Affiliates.


 


Conduct,
and cause each of its Subsidiaries to conduct, all transactions otherwise
permitted under the Loan Documents with any of their Affiliates on terms that
are fair and reasonable and no less favorable to the Borrower or such
Subsidiary than it would obtain in a comparable arms-length transaction with a
Person not an Affiliate.


 


Section 5.13         Additional Guarantors; Agreement
to Grant Additional Security.


 


(a)           Promptly,
and in any event within thirty (30) days after the acquisition of assets
of the type that would constitute Collateral (other than assets with a fair
market value of less than $250,000), including the capital stock or other
equity interests of any direct or indirect Subsidiary of the Borrower, notify
the Administrative Agent of the acquisition of such assets or investments and,
to the extent not already Collateral in which the Administrative Agent has a
perfected security interest pursuant to the Collateral Documents, such assets
will become additional Collateral hereunder to the extent the Administrative
Agent deems the pledge of such assets practicable (the “Additional
Collateral”), and the Borrower will, and will cause each of its direct and
indirect Subsidiaries to, take all necessary action, including the filing of
appropriate financing statements under the provisions of the UCC, applicable
foreign, domestic or local laws, rules or regulations in each of the
offices where such filing is necessary or appropriate to grant the
Administrative Agent a perfected Lien in such Collateral (or comparable
interest under foreign law in the case of foreign Collateral) pursuant to and
to the full extent required by the Collateral Documents and this Agreement.


 


(b)           Promptly,
and in any event no later than thirty (30) days after the acquisition or
formation of any Domestic Subsidiary, cause such Domestic Subsidiary to become
party to, or to execute and deliver a Subsidiary Guaranty, guarantying to the
Administrative Agent and the Lenders the prompt payment, when and as due, of
all Obligations.


 


(c)           Promptly,
and in any event no later than thirty (30) days after the acquisition or
formation of any Domestic Subsidiary, cause such Domestic Subsidiary to grant
to the Administrative Agent, for the ratable benefit of the Lenders, a first
priority Lien on all property (tangible and intangible) of such Domestic
Subsidiary, including, without limitation, all of the equity interests of any
of its Domestic Subsidiaries and 65% of the equity interests of any of its
direct Foreign Subsidiaries, upon terms similar to those set forth in the
Collateral Documents and otherwise satisfactory in form and substance to the
Administrative Agent.  The Borrower shall
cause each Domestic Subsidiary, at its own expense, to become a party to a
Security Agreement, an Intellectual Property Security Agreement, a Mortgage and
any other Collateral Document and to execute, acknowledge and deliver, or cause
the execution, acknowledgment and delivery of, and thereafter register, file or
record in any appropriate governmental office, any document or instrument
reasonably deemed by the Administrative Agent to be necessary or desirable for
the creation and perfection of the foregoing Liens (including legal opinion,
title insurance, consents, corporate documents and any additional or substitute
security agreements or mortgages or deeds of trust).  The Borrower will cause each such Domestic
Subsidiary to take all actions reasonably requested by the Administrative Agent
(including, without limitation, the filing of UCC-1’s) in connection with
the granting of such security interests.


 


(d)           Promptly,
and in any event not later than thirty (30) days after a request by the
Administrative Agent with respect thereto, (i) deliver to the
Administrative Agent as Collateral security the original of all instruments,
documents and chattel paper, and all other Collateral of which the
Administrative Agent determines it should have physical possession in order to
perfect and protect its security interest therein, duly pledged, endorsed or
assigned to the Administrative Agent without restriction; (ii) use
commercially reasonable efforts to obtain landlord waivers, in form and
substance


 


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satisfactory to the
Administrative Agent, with respect to any Inventory or other Collateral located
at a location that is not owned by the Borrower or a Subsidiary; (iii) deliver
to the Administrative Agent warehouse receipts covering any portion of the
Inventory or other Collateral located in warehouses and for which warehouse
receipts are issued; (iv) when an Event of Default exists, transfer
Inventory to locations designated by the Administrative Agent; (v) if any
Collateral valued in excess of $50,000 is at any time in the possession or
control of any warehousemen, bailee or the Borrower’s agents or processors,
notify the Administrative Agent thereof and notify such person of the
Administrative Agent’s security interest in such Collateral and obtain a
landlord waiver or bailee letter, in form and substance satisfactory to the
Administrative Agent, from such person and instruct such person to hold all
such Collateral for the Administrative Agent’s account subject to the
Administrative Agent’s instructions; (vi) if at any time any Inventory or
other Collateral is located on any real property of the Borrower which is
subject to a mortgage or other Lien, obtain a mortgagee waiver, in form and
substance satisfactory to the Administrative Agent, from the holder of each
mortgage or other Lien on such real property; (vii) when an Event of
Default exists, with respect to any deposit accounts of the Loan Parties that
are not maintained with the Administrative Agent or a Lender, obtain tri-party
account control agreements with respect thereto, each in form and substance
satisfactory to the Administrative Agent; and (viii) take all other
reasonable actions and obtain all such other agreements as the Administrative
Agent may reasonably deem necessary or desirable in respect of any Collateral.


 


(e)           The
security interests required to be granted pursuant to this Section shall
be granted pursuant to the Collateral Documents or, in the Administrative Agent’s
discretion, such other security documentation (which shall be substantially
similar to the Collateral Documents already executed and delivered by the
Borrower and the Guarantors) as is satisfactory in form and substance to the
Administrative Agent (the “Additional Collateral Documents”) and shall
constitute valid and enforceable perfected security interests prior to the
rights of all third Persons and subject to no other Liens except Liens
permitted under Section 6.1. 
The Additional Collateral Documents and other instruments related
thereto shall be duly recorded or filed in such manner and in such places and
at such times as are required by law to establish, perfect, preserve and
protect the Liens, in favor of the Administrative Agent, for the benefit of the
Lender Parties, granted pursuant to the Additional Collateral Documents and,
all taxes, fees and other charges payable in connection therewith shall be paid
in full by the Borrower.  At the time of
the execution and delivery of Additional Collateral Documents, the Borrower
shall cause to be delivered to the Administrative Agent such agreements,
opinions of counsel, and other related documents as may be reasonably requested
by the Administrative Agent or the Required Lenders to assure themselves that
this Section has been complied with.


 


Section 5.14         Performance of Crosstex
Acquisition Documents.


 


Perform
and observe, or cause the relevant Subsidiary to perform and observe, all of
the terms and provisions of each Crosstex Acquisition Document to be performed
or observed by it or such Subsidiary, maintain each such Crosstex Acquisition
Document in full force and effect, enforce each such Crosstex Acquisition
Document in accordance with its terms, take all such action required or
permitted under the Crosstex Acquisition Documents to such end as may be from
time to time reasonably requested by the Administrative Agent and, upon request
of the Administrative Agent, make such demands and requests for action or for
information and reports any Borrower or any Subsidiary is entitled to make
under any Crosstex Acquisition Document.


 


Section 5.15         Cash
Concentration Accounts.


 


The
Borrower will maintain its main cash concentration accounts with the Administrative
Agent or a Lender.


 


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Section 5.16         Post-Closing
Matters.


 


To
the extent not delivered on the Closing Date,


 


(a)           Within
ninety (90) days following the Closing Date (or such later date as the Administrative
Agent determines in its discretion), the Borrower shall deliver pledge
agreements with respect to (or take such other action as is necessary to allow
the Administrative Agent to obtain a valid and enforceable, first priority,
perfected security interest in) 65% of the stock of Minntech B.V. and Minntech
Japan K.K., in each case under the laws of the respective jurisdictions of
organization and together with legal opinions of counsel in such jurisdictions.


 


(b)           Within
forty-five (45) days following the Closing Date (or such later date as the
Administrative Agent determines in its discretion), the Borrower shall deliver
all documentation required to be delivered pursuant to Section 3.1(a)(iii)(B) and
the survey for the Crosstex property required to be delivered pursuant to Section 3.1(a)(iii)(C).


 


(c)           Within
ten (10) Business Days following the Closing Date (or such later date as
the Administrative Agent determines in its discretion), the Borrower shall
deliver all documentation required to be delivered pursuant to Section 3.1(d).


 


(d)           Within
thirty (30) days following the Closing Date (or such later date as the
Administrative Agent determines in its discretion), the borrower shall deliver
the good standing certificates for MarCor Services, Inc. and Biolab
Equipment Atlantic, Ltd. required to be delivered pursuant to Section 3.1(a)(vi)(C).


 


ARTICLE VI


 


NEGATIVE COVENANTS


 


So
long as any Advance shall remain unpaid, any Letter of Credit shall be
outstanding or any Lender Party shall have any Commitment hereunder, the
Borrower covenants that, without the prior consent of the Required Lenders, it
will not, at any time, and will not permit any Subsidiary to:


 


Section 6.1            Liens, Etc.


 


Create,
incur, assume or suffer to exist any Lien on or with respect to any of its
properties of any character whether now owned or hereafter acquired, or sign or
file or suffer to exist, or permit any of its Subsidiaries to sign or file or
suffer to exist, under the Uniform Commercial Code or any other statute of any
jurisdiction, a financing statement that names the Borrower or any of its
Subsidiaries as debtor, or sign or suffer to exist, or permit any of its
Subsidiaries to sign or suffer to exist, any security agreement authorizing any
secured party thereunder to file any such financing statement, or assign, or
permit any of its Subsidiaries to assign, any accounts or other right to
receive income, excluding, however, from the operation of the
foregoing restrictions the following:


 


(a)           Liens created under the Loan
Documents;


 


(b)           Permitted Liens;


 


(c)           Liens existing on the Closing Date
and described on Schedule 6.1(c);


 


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(d)           Purchase money Liens securing Debt
permitted under Section 6.2(c)(i) upon real property or
Equipment acquired or held by the Borrower or any of its Subsidiaries in the
ordinary course of business to secure the purchase price of such real property
or Equipment or to secure Debt incurred solely for the purpose of financing the
acquisition, construction or improvement of any such real property or Equipment
to be subject to such Liens, or Liens existing on any such real property or
Equipment at the time of acquisition (other than any such Liens created in
contemplation of such acquisition that do not secure the purchase price), or
extensions, renewals or replacements of any of the foregoing for a
substantially equivalent or a lesser amount; provided, however,
that no such Lien shall extend to or cover any property other than the real
property or Equipment being acquired, constructed or improved, and no such
extension, renewal or replacement shall extend to or cover any property not
theretofore subject to the Lien being extended, renewed or replaced;


 


(e)           Liens arising in connection with
Capitalized Leases or Operating Leases permitted under Section 6.2(c)(i) or
Section 6.2(c)(ii), as applicable; provided, that no such
Lien shall extend to or cover any Collateral or any assets other than the
assets subject to such Capitalized Leases or Operating Leases;


 


(f)            Liens granted by Carsen as required
or permitted under the Canadian Credit Agreement; and


 


(g)           The replacement, extension or renewal
of any Lien permitted by clauses (b) through (e) above upon
or in the same property theretofore subject thereto in connection with the
replacement, extension or renewal (without increase in the amount or any change
in any direct or contingent obligor other than insofar as Borrower is permitted
to incur the Debt in connection therewith pursuant to Section 6.2(c)(i))
of the Debt secured thereby.


 


Section 6.2            Debt.


 


Create,
incur, assume or suffer to exist any Debt other than:


 


(a)           In the case of the Borrower, (i) Debt
incurred pursuant to the Loan Documents and (ii) Debt owed to a Subsidiary
as a result of cash advances from such Subsidiary to Borrower after the Closing
Date which shall be repaid from time to time;


 


(b)           In the case of any of the
Subsidiaries of the Borrower, Debt owed to the Borrower or to a Wholly Owned
Domestic Subsidiary of the Borrower; provided, that such Debt shall be
evidenced by an Intercompany Note, such Intercompany Note is assigned and
pledged to the Administrative Agent pursuant to the terms of the Security
Agreement and the Note Assignment Agreement and there are no restrictions
whatsoever on the ability of such Subsidiary to repay such Debt;


 


(c)           In the case of the Borrower and any
of its Subsidiaries:


 


(i)            (A) Debt secured by Liens
permitted by Section 6.1(d) not to exceed in the aggregate
$500,000 at any time outstanding, (B) Capitalized Leases, collectively not
to exceed in the aggregate $250,000 at any time outstanding, (C) Operating
Leases with a maximum annual rental obligation collectively not to exceed in
the aggregate $3,000,000 at any time outstanding and (D) Debt existing on
the Closing Date and described on Schedule 4.19; and


 


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(ii)           endorsement of negotiable instruments
for deposit or collection or similar transactions in the ordinary course of
business;


 


(d)           In the case of Carsen, Debt incurred
pursuant to (i) the Canadian Credit Agreement in an amount not to exceed
$5,000,000 and (ii) the Hedge Agreements permitted under Section 6.16(b);
and


 


(e)           Debt assumed in connection with a
Permitted Acquisition but not incurred in contemplation thereof.


 


Section 6.3            Accounts
Payable.


 


Permit
any accounts payable of the Borrower or any of its Subsidiaries arising from
the purchase of property or services, including, without limitation, Inventory
acquired for resale to be outstanding for longer than 120 days from the
date of incurrence, except (a) accounts payable which by their terms
become payable after 120 days from incurrence or (b) accounts payable
that are subject to good faith dispute by the Borrower.


 


Section 6.4            Fundamental
Changes.


 


(a)           Merge
into or consolidate with any Person or permit any Person to merge into it
except that so long as no Default shall have occurred and be continuing and so
long as no Default would result therefrom, (A) the Borrower or any
Wholly-Owned Subsidiaries of the Borrower may make Permitted Acquisitions; (B) any
Subsidiary of the Borrower may consolidate with or merge into the Borrower or
any Wholly-Owned Subsidiary of the Borrower if the Borrower or such
Wholly-Owned Subsidiary will be the surviving corporation; and (C) any Subsidiary
may sell, lease, transfer, contribute or otherwise dispose of its assets, in
whole or in part, to Borrower or any other Wholly-Owned Subsidiary of the
Borrower, and may, following any such disposition in whole, liquidate and
dissolve and the Borrower may transfer, contribute or otherwise dispose of its
assets in whole or in part to any Wholly-Owned Subsidiary of the Borrower, provided
that the Borrower shall have given the Administrative Agent not less than
ten (10) Business Days prior written notice and prior to effecting
such merger, Borrower shall take all actions, if any, reasonably required by
the Administrative Agent to preserve the Administrative Agent’s security
interest in the Collateral and all other rights and remedies of the Lenders and
the Administrative Agent under the Loan Documents or otherwise then existing by
law;


 


(b)           Except
for the Carsen Disposition and as otherwise expressly permitted herein,
liquidate, wind-up or dissolve itself (or suffer any liquidation or
dissolution), convey, sell, assign, lease, transfer or otherwise dispose of (or
agree to do any of the foregoing at any future time) all or substantially all
of its property, business or assets,; or


 


(c)           Except
for Permitted Acquisitions as expressly permitted herein, acquire all or
substantially all of the assets of any other Person (including the capital
stock or other equity interests thereof).


 


Section 6.5            Sales,
Etc. of Assets.


 


Sell,
lease, transfer or otherwise dispose of any assets or grant any option or other
right to purchase, lease or otherwise acquire any assets, except:


 


(a)           sales of Inventory in the ordinary
course of business;


 


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(b)           sales of obsolete Equipment in the
ordinary course of business;


 


(c)           subject to compliance with Section 2.6(b)(ii),
the Carsen Disposition;


 


(d)           subject to compliance with Section 2.6(b)(ii),
the sale of any asset by the Borrower or any of its Subsidiaries (other than an
asset included in Section 6.5(a), (b), (c) or (e))
so long as (i) the purchase price paid to the Borrower or such Subsidiary
for such asset shall be no less than the fair market value of such asset at the
time of such sale, (ii) the purchase price for such asset shall be paid to
the Borrower or such Subsidiary solely in cash and (iii) the aggregate
purchase price paid to the Borrower and all of its Subsidiaries for such asset
and all other assets sold by the Borrower and its Subsidiaries (other than an
asset included in Section 6.5(a), (b), (c) or (e))
in any Fiscal Year pursuant to this clause (c) shall not exceed
$500,000; and


 


(e)           subject to compliance with Section 2.6(b)(ii),
sales of assets (other than an asset included in Section 6.5(a), (b) or (c))
the aggregate purchase price of which in any Fiscal Year does not exceed
$250,000.


 


Section 6.6            Investments in Other Persons.


 


Make
or hold any Investment in any Person other than:


 


(a)           Investments by the Borrower and its
Subsidiaries in their Subsidiaries outstanding on the Closing Date and
described on Schedule 6.6(a), and additional Investments in Wholly
Owned Subsidiaries of the Borrower; provided, however, that no
more than an aggregate amount equal to $2,000,000 outstanding at any time in
addition to amounts previously invested shall be invested from the Closing Date
by the Loan Parties in Foreign Subsidiaries; and, provided, further,
that with respect to Investments in any newly acquired or created Wholly Owned
Subsidiary (other than a Foreign Subsidiary), any such Subsidiary shall become
a Guarantor pursuant to the terms of the Subsidiary Guaranty and an additional
grantor pursuant to the terms of the Security Agreement and Intellectual
Property Security Agreement and otherwise comply with Section 5.13;


 


(b)           Loans and advances to officers and
other employees in the ordinary course of the business of the Borrower and its
Subsidiaries in an aggregate principal amount not to exceed $250,000 at any
time outstanding;


 


(c)           Investments by the Borrower and its
Subsidiaries in Cash Equivalents;


 


(d)           Investments by the Borrower and its
Subsidiaries in Bank Hedge Agreements;


 


(e)           Investments consisting of
intercompany Debt permitted under Section 6.2(b);


 


(f)            Investments existing on the Closing
Date and described on Schedule 6.6(f) hereto;


 


(g)           Investments by the Borrower and its
Subsidiaries in deposit accounts opened in the ordinary course of business;


 


(h)           Investments consisting of accounts
receivable in the ordinary course of business;


 


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(i)            Investments consisting of other marketable
securities the aggregate purchase price of which shall not exceed $500,000; and


 


(j)            Permitted Acquisitions.


 


Section 6.7            Dividends,
Etc.


 


Declare
or pay any dividends, purchase, redeem, retire, defease or otherwise acquire
for value any of its capital stock or any warrants, rights or options to
acquire such capital stock, now or hereafter outstanding, return any capital to
its stockholders as such, make any distribution of assets, capital stock,
warrants, rights, options, obligations or securities to its stockholders as
such or issue or sell any capital stock or any warrants, rights or options to
acquire such capital stock, or permit any of its Subsidiaries to purchase,
redeem, retire, defease or otherwise acquire for value any capital stock of the
Borrower or any warrants, rights or options to acquire such capital stock or to
issue or sell any such capital stock or any warrants, rights or options to
acquire such capital stock, except:


 


(a)           the Borrower may declare and pay
dividends and distributions payable solely in common stock of the Borrower;


 


(b)           a Subsidiary of the Borrower may
declare and pay dividends and distributions to the Borrower;


 


(c)           the Borrower may consummate the
Crosstex Acquisition;


 


(d)           for issuances of stock expressly
permitted by Section 6.18; and


 


(e)           stock acquired as the purchase price
for stock to be issued pursuant to an Equity Compensation Plan or pursuant to
any stock option issued by the Borrower.


 


Section 6.8            Change
in Nature of Business.


 


Make
any material change in the nature of its business as carried on at the Closing
Date, it being understood and agreed that the Carsen Disposition shall not
constitute a breach of this Section 6.8.


 


Section 6.9            Charter
Amendments.


 


Amend
its certificate or articles of incorporation, bylaws or any equivalent or
comparable constitutive document if such amendment could impair the interests
or rights of the Administrative Agent or any Lender Party.


 


Section 6.10         Accounting
Changes.


 


Make
or permit any change in (a) accounting policies or reporting practices,
except as mandated or permitted by GAAP, or (b) its Fiscal Year (other
than to change Crosstex’s fiscal year to coincide with the Borrower’s Fiscal
Year.


 


Section 6.11         Prepayments,
Etc. of Debt.


 


(a)           Prepay,
redeem, purchase, defease or otherwise satisfy prior to the scheduled maturity
thereof in any manner, or make any payment in violation of any subordination
terms of, any Debt, other than (i) the prepayment of the Advances in
accordance with the terms of this Agreement (ii) regularly


 


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scheduled or required
repayments or redemptions of Debt and (iii) the prepayment of payables in
the ordinary course of business in connection with any discounting
arrangements, (b) amend, modify or change in any manner any term or
condition of any Debt the principal amount of which is greater than $100,000,
or (c) permit any of its
Subsidiaries to do any of the foregoing other than to repay any Debt payable to
the Borrower, provided, that, Carsen shall be permitted to prepay
Debt as required or permitted under the Canadian Credit Agreement.


 


Section 6.12         Amendment,
Etc.  of Crosstex Acquisition Documents.


 


Cancel
or terminate any Crosstex Acquisition Document or consent to or accept any
cancellation or termination thereof, amend, modify or change in any manner any
term or condition of any Crosstex Acquisition Document or give any consent,
waiver or approval thereunder, waive any default under or any breach of any
term or condition of any Crosstex Acquisition Document or take any other action
in connection with any Crosstex Acquisition Document that would, in any such
case, impair the value of the interests or rights of the Borrower thereunder,
or would impair the interests or rights of the Administrative Agent or any
Lender Party.


 


Section 6.13         Amendment, Etc. of Material
Contracts.


 


Except
in connection with the Carsen Disposition, cancel or terminate any Material
Contract or consent to or accept any cancellation or termination thereof, amend
or otherwise modify any Material Contract or give any consent, waiver or
approval thereunder, waive any default under or breach of any Material Contract
or take any other action in connection with any Material Contract in any said
events that would materially impair the value of the interests or rights of the
Borrower thereunder or that could impair the interests or rights of the
Administrative Agent or any Lender Party.


 


Section 6.14         Negative
Pledge.


 


Enter
into or suffer to exist any agreement prohibiting or conditioning the creation
or assumption of any Lien in favor of the Administrative Agent upon any of its
properties or assets, other than as provided in the Loan Documents.


 


Section 6.15         Partnerships,
New Subsidiaries.


 


(a)           Become
a general partner in any general or limited partnership or joint venture, or


 


(b)           Create
any new Subsidiary, unless the Borrower and such Subsidiary comply with Section 5.13,
including, without limitation, by causing such newly created Subsidiary to
become a Guarantor pursuant to the terms of the Subsidiary Guaranty and an
additional grantor pursuant to the terms of the Security Agreement and
Intellectual Property Security Agreement and all shares of the capital stock of
such Subsidiary (or 65% of the shares, in the case of Foreign Subsidiaries,
unless such shares are required to be pledged under the Canadian Credit
Agreement) to be pledged to the Administrative Agent pursuant to the Security
Agreement.


 


Section 6.16         Speculative
Transactions.


 


Engage
in any transaction involving commodity options or futures contracts or
derivatives or any similar speculative transactions, except for (a) Bank
Hedge Agreements, (b) Hedge Agreements used by Carsen to mitigate the
financial risk of currency fluctuations between the Dollar and the Canadian
Dollar which shall not exceed twenty-four (24) months in duration and
shall be in an aggregate notional amount not to exceed $35,000,000 outstanding
at any time and (c) Hedge Agreements used by Minntech


 


69





















 


Corporation to mitigate the
financial risk of currency fluctuations between the Dollar and either the
Eurodollar or the Japanese Yen which shall not exceed twelve (12) months
in duration and shall be in an aggregate notional amount not to exceed
$12,000,000 outstanding at any time.


 


Section 6.17         Capital
Expenditures.


 


Make
any Capital Expenditures that would cause the aggregate of all such Capital
Expenditures made by the Borrower and its Subsidiaries in any Fiscal Year to
exceed $7,500,000; provided, however, that amounts permitted to
be expended in a Fiscal Year that are not expended in such Fiscal Year, but not
in excess of fifty percent (50%) of such prior Fiscal Year’s unused amount (not
including any amount permitted to be carried forward from a prior Fiscal Year),
shall be permitted to be expended in (but only in) the subsequent Fiscal Year.


 


Section 6.18         Issuance
of Stock.


 


The
Borrower will not, directly or indirectly, issue, sell, assign, pledge or
otherwise encumber or dispose of any shares of capital stock or other equity
interests of the Borrower or any Subsidiary of the Borrower, except (a) to
the Borrower, (b) to qualify directors if required by applicable law, (c) as
set forth in Schedule 6.18, (d) pursuant to the Crosstex
Acquisition in accordance with the Crosstex Acquisition Documents, (e) issuances
of capital stock by the Borrower in connection with a Permitted Acquisition, (f) by
the Borrower in connection with the exercise of stock options issued pursuant
to a Stock Option Plan or grant pursuant to an Equity Compensation Plan, and (g) issuances
of capital stock of the Borrower but only on the condition that no such
instrument or security by its terms shall mandate or require the Borrower to,
and no holder thereof shall have the right to require the Borrower to, (i) declare
or pay any cash dividends or cash distributions in respect thereof or (ii) purchase,
redeem, retire, defease or otherwise acquire for cash any of its capital stock,
warrants, options or rights to acquire such capital stock or (iii) issue
securities in respect thereof which payments of or in respect of which are not
subordinate to the Obligations under the Loan Documents; and, provided, further
that no such capital stock shall contain any rights, whether or not on
conversion or otherwise that, if exercisable or exercised on the date of
issuance could result in a Change of Control, or if exercisable or exercised at
any time thereafter could reasonably be expected to result in a Change of
Control, and any references in this Agreement to permitted issuances of capital
stock of the Borrower shall be subject to the terms of this Section 6.18.


 


Section 6.19         Guaranteed
Obligations.


 


Create,
incur, assume or permit to exist any Guaranteed Obligations except (a) by
endorsement of instruments or items of payment for deposit to the general
account of any Loan Party, (b) for Guaranteed Obligations set forth on Schedule 6.19.


 


Section 6.20         Use of Certain Earnings of
Foreign Subsidiaries.


 


Until
the Interim Term Facility has been repaid in full, use the earnings of Foreign
Subsidiaries described in Section 4.28 for any purpose other than
to repay the Interim Term Facility.


 


ARTICLE VII


 


REPORTING REQUIREMENTS


 


So
long as any Advance shall remain unpaid, any Letter of Credit shall be
outstanding or any Lender Party shall have any Commitment hereunder, the
Borrower will furnish to the Administrative Agent and Lender Parties:


 


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Section 7.1            Default
Notice.


 


As
soon as possible and in any event within two (2) Business Days after
a Responsible Officer of the Borrower obtains knowledge of the occurrence of
any Default or any event, development or occurrence reasonably likely to have a
Material Adverse Effect, a statement of the president or a vice president of
the Borrower setting forth details of such Default or event, development or
occurrence and the action that the Borrower has taken and proposes to take with
respect thereto.


 


Section 7.2            Quarterly
Financials.


 


At
the earlier of the date of filing with the Securities and Exchange Commission
of Borrower’s quarterly report on form 10-Q or fifty (50) days
after the end of each fiscal quarter of each Fiscal Year, a Consolidated
balance sheet of the Borrower and its Subsidiaries, and consolidating balance
sheet of the Borrower and its Subsidiaries, as of the end of such quarter and a
Consolidated statement of income and a Consolidated statement of cash flows of
the Borrower and its Subsidiaries, and a consolidating statement of income of
the Borrower and its Subsidiaries, for the period commencing at the end of the
previous fiscal quarter and ending with the end of such fiscal quarter and a
Consolidated statement of income and a Consolidated statement of cash flows of
the Borrower and its Subsidiaries and a consolidating statement of income of
the Borrower and its Subsidiaries for the period commencing at the end of the
previous Fiscal Year and ending with the end of such fiscal quarter, setting
forth in each case in comparative form the corresponding figures for the
corresponding period of the preceding Fiscal Year, all in reasonable detail and
duly certified by the president or a vice president of the Borrower as having
been prepared in accordance with GAAP (subject to year-end type adjustments),
together with (i) a certificate of said officer stating that no Default
has occurred and is continuing or, if a Default has occurred and is continuing,
a statement as to the nature thereof and the action that the Borrower has taken
and proposes to take with respect thereto and (ii) a schedule in form
satisfactory to the Administrative Agent of the computations used by the
Borrower in determining compliance with the financial covenants contained in Article VIII,
provided, that in the event of any change in GAAP used in the preparation
of such financial statements, the Borrower shall also provide, if necessary for
the determination of compliance with Article VIII, a statement of
reconciliation conforming such financial statements to GAAP; provided, further,
that to the extent that comparable information is set forth in the Borrower’s
quarterly report on form 10-Q filed with the Securities and Exchange
Commission for each such quarter, delivery to the Administrative Agent and the
Lender Parties of such 10-Q within the time period specified above shall
be acceptable for purposes of this Section 7.2.


 


Section 7.3            Annual
Financials.


 


At
the earlier of the date of filing with the Securities and Exchange Commission
of Borrower’s annual report on Form 10-K or one hundred
five (105) days after the end of each Fiscal Year, a copy of the annual
audit report for such year for the Borrower and its Subsidiaries, including
therein a Consolidated balance sheet of the Borrower and its Subsidiaries, and
consolidating balance sheet of Borrower and its Subsidiaries, as of the end of
such Fiscal Year and a Consolidated statement of income and a Consolidated
statement of cash flows of the Borrower and its Subsidiaries, and a
consolidating statement of income of the Borrower and its Subsidiaries, for such
Fiscal Year, in each case setting forth in comparative form the corresponding
figures for the prior Fiscal Year in the case of such Consolidated financial
statements accompanied by an opinion acceptable to the Administrative Agent of
Ernst & Young LLP or other independent certified public
accountants of recognized national standing acceptable to the Administrative
Agent, with the consent of the Required Lenders, together with (a) a
letter of such accounting


 


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firm to the Administrative
Agent and Lender Parties stating that in the course of the regular audit of the
business of the Borrower and its Subsidiaries, which audit was conducted by
such accounting firm in accordance with generally accepted auditing standards,
such accounting firm has obtained no knowledge that a Default has occurred and
is continuing, or if, in the opinion of such accounting firm, a Default has
occurred and is continuing, a statement as to the nature thereof, (b) a schedule in
form satisfactory to the Administrative Agent of the computations used by such
accountants in determining, as of the end of such Fiscal Year, compliance with
the covenants contained in Article VIII, provided, that in
the event of any change in GAAP used in the preparation of such financial
statements, the Borrower shall also provide, if necessary for the determination
of compliance with Article VIII, a statement of reconciliation
conforming such financial statements to GAAP and (c) a certificate of the
president or a vice president of the Borrower stating that no Default has
occurred and is continuing or, if a Default has occurred and is continuing, a
statement as to the nature thereof and the action that the Borrower has taken
and proposes to take with respect thereto.


 


Section 7.4            Annual
Forecasts.


 


As
soon as available and in any event no later than sixty (60) days after the
end of each Fiscal Year, (i) forecasts prepared by management of the
Borrower, including balance sheets, income statements and cash flow statements
on a quarterly basis, prepared on a basis consistent with the financial
statements delivered pursuant to Sections 7.2 and 7.3
and (ii) a business plan, in each case for the Fiscal Year following such
Fiscal Year then ended and in form reasonably satisfactory to the
Administrative Agent.


 


Section 7.5            ERISA Events and ERISA Reports.


 


(i)            Promptly
and in any event within twenty (20) days after any Loan Party or any ERISA
Affiliate knows or has reason to know that any ERISA Event has occurred, a statement
of the president or a vice president of the Borrower describing such ERISA
Event and the action, if any, that such Loan Party or such ERISA Affiliate has
taken and proposes to take with respect thereto and (ii) on the date any
records, documents or other information must be furnished to the PBGC with
respect to any Plan pursuant to Section 4010 of ERISA, a copy of such
records, documents and information.


 


Section 7.6            Plan
Terminations.


 


Promptly
and in any event within five (5) Business Days after receipt thereof
by any Loan Party or any ERISA Affiliate, copies of each notice from the PBGC
stating its intention to terminate any Plan or to have a trustee appointed to
administer any Plan or correspondence from the PBGC indicating it is
considering termination of any Plan.


 


Section 7.7            Actuarial
Reports.


 


Promptly
upon receipt thereof by any Loan Party or any ERISA Affiliate, a copy of the
annual actuarial valuation report for each Plan the funded current liability
percentage (as defined in Section 302(d)(8)(B) of ERISA) of which is
less than 90% or the unfunded current liability (as defined in Section 302(d)(8)(A) of
ERISA) of which exceeds $500,000 or the present value of benefit liabilities as
of the latest actuarial valuation date for such Plan (but not prior to
12 months prior to the Closing Date), determined on the basis of a shut
down of the company in accordance with actuarial assumptions used by the PBGC
in single-employer plan terminations, exceeds the market value of assets
exclusive of any contributions due to the Plan by $500,000.


 


Section 7.8            Plan
Annual Reports.


 


Upon
the request, from time to time, of the Administrative Agent, promptly and in
any event within thirty (30) days after the filing thereof with the
Internal Revenue Service, copies of each


 


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Schedule B (Actuarial
Information) to the annual report (Form 5500 Series) with respect to each
Plan (to the extent applicable).


 


Section 7.9            Annual
Plan Summaries.


 


As
soon as available and in any event within ninety (90) days after the end
of each Fiscal Year, an annual summary of actuarial valuation and other
information with respect to each Plan in form, substance and detail
satisfactory to the Administrative Agent.


 


Section 7.10         Multiemployer
Plan Notices.


 


Promptly
and in any event within five (5) Business Days after receipt thereof
by any Loan Party or any ERISA Affiliate from the sponsor of a Multiemployer
Plan, copies of each notice concerning, or other correspondence with respect
to, (i) the imposition of Withdrawal Liability by any such Multiemployer
Plan, (ii) the reorganization or termination, within the meaning of
Title IV of ERISA, of any such Multiemployer Plan or (iii) the amount
of liability incurred, or that may be incurred, by such Loan Party or any ERISA
Affiliate in connection with any event described in clause (i) or (ii).


 


Section 7.11         Litigation.


 


Promptly
after the commencement thereof, notice of all material actions, suits,
investigations, litigation and proceedings before any court or governmental
department, commission, board, bureau, agency or instrumentality, Federal,
state, local or foreign, affecting any Loan Party or any of its Subsidiaries
and, promptly after the occurrence thereof, notice of any Material Adverse Change
in the status or the financial effect on any Loan Party or any of its
Subsidiaries of the Disclosed Litigation from that described on Schedule 4.9.


 


Section 7.12         Securities
Reports.


 


Promptly
after the sending or filing thereof, copies of all proxy statements, financial
statements and reports that any Loan Party or any of its Subsidiaries sends to
its equity holders, and copies of all regular, periodic and special reports,
and all registration statements, that any Loan Party or any of its Subsidiaries
files with the Securities and Exchange Commission or any other governmental
authority or with any national securities exchange.


 


Section 7.13         Creditor
Reports.


 


Promptly
after the furnishing thereof, copies of any statement or report furnished to
any other holder of the securities of any Loan Party or of any of its
Subsidiaries pursuant to the terms of any indenture, loan or credit agreement
or similar agreement or instrument and not otherwise required to be furnished
to the Lender Parties pursuant to any other clause of this Article VII.


 


Section 7.14         Agreement
Notices.


 


Promptly
upon the sending or receipt thereof, copies of all notices, requests and other
documents sent or received by any Loan Party or any of its Subsidiaries under
or pursuant to any Material Contract or indenture, loan or credit agreement or
similar agreement or instrument regarding or related to any breach or default
by any party thereto or any event that could materially impair the value of the
interests or the rights of any Loan Party or any of its Subsidiaries or
otherwise have a Material Adverse Effect and copies of any amendment,
modification or waiver of any provision of any Material Contract or indenture,
loan or credit agreement or similar agreement or indenture and, from time to time
upon request by the


 


73





















 


Administrative Agent, such
information and reports regarding the foregoing as the Administrative Agent may
reasonably request.


 


Section 7.15         Revenue
Agent Reports.


 


Within
ten (10) days after receipt, copies of all Revenue Agent Reports
(Internal Revenue Service Form 886), or other written proposals of the
Internal Revenue Service, that propose, determine or otherwise set forth any
adjustments to the Federal income tax liability of the affiliated group (within
the meaning of Section 1504(a)(1) of the Internal Revenue Code) of
which the Borrower is a member aggregating $250,000 or more.


 


Section 7.16         Environmental
Conditions.


 


Promptly
after the assertion or occurrence thereof, notice of any Environmental Action
against or of any noncompliance by any Loan Party or any of its Subsidiaries
with any Environmental Law or Environmental Permit that could reasonably be
expected to have a Material Adverse Effect.


 


Section 7.17         Real Property.


 


Upon
the request, from time to time, of the Administrative Agent, promptly and in
any event within thirty (30) days after any such request, a report
supplementing Schedules 4.21 and 4.22 hereto, including
an identification of all real and leased property disposed of by the Borrower
or any of its Subsidiaries during such Fiscal Year, a list and description
(including the street address, county or other relevant jurisdiction, state,
record owner and, in the case of leases of property, lessor, lessee, expiration
date and annual rental cost thereof) of all real property acquired or leased
during such Fiscal Year and a description of such other changes in the
information included in such Schedules as may be necessary for such
Schedules to remain accurate and complete in all respects.


 


Section 7.18         Insurance.


 


Upon
the request, from time to time, of the Administrative Agent, promptly and in
any event within thirty (30) days after any such request, a report
summarizing the insurance coverage (specifying type, amount and carrier) in
effect for each Loan Party and its Subsidiaries and containing such additional
information as the Administrative Agent may reasonably request.


 


Section 7.19         Management
Letters.


 


As
soon as available and in any event within five (5) Business Days
after the receipt thereof, copies of any “management letter” or similar letter
received by the Borrower or its board of directors (or any committee thereof)
from its independent public accountants.


 


Section 7.20         Extraordinary
or Unusual Items.


 


As
soon as possible but in any event within thirty (30) days after, the
accrual of any extraordinary or unusual item that might be deducted in
determining net income of the Borrower or any of its Subsidiaries, notice
thereof.


 


Section 7.21         Other
Information.


 


Such
other information respecting the business, condition (financial or otherwise),
operations, performance, properties or prospects of any Loan Party or any of
its Subsidiaries or the Collateral as the


 


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Administrative Agent or any
Lender Party (through the Administrative Agent) may from time to time
reasonably request.


 


The
Borrower hereby acknowledges that (a) the Administrative Agent and/or the
Arranger will make available to the Lender Parties materials and/or information
provided by or on behalf of the Borrower hereunder (collectively, “Borrower
Materials”) by posting the Borrower Materials on IntraLinks or another
similar electronic system (the “Platform”) and (b) certain of the
Lenders may be “public-side” Lenders (i.e., Lenders
that do not wish to receive material non-public information with respect to the
Borrower or its securities) (each, a “Public Lender”).  The Borrower hereby agrees that (w) all
Borrower Materials that are to be made available to Public Lenders shall be
clearly and conspicuously marked “PUBLIC” which, at a minimum, shall mean that
the word “PUBLIC” shall appear prominently on the first page thereof; (x)
by marking Borrower Materials “PUBLIC,” the Borrower shall be deemed to have
authorized the Administrative Agent, the Arranger, and the Lender Parties to
treat such Borrower Materials as not containing any material non-public
information with respect to the Borrower or its securities for purposes of
United States Federal and state securities laws (provided, however,
that to the extent such Borrower Materials constitute Information, they shall
be treated as set forth in Section 11.10); (y) all Borrower
Materials marked “PUBLIC” are permitted to be made available through a portion
of the Platform designated “Public Investor;” and (z) the Administrative Agent
and the Arranger shall be entitled to treat any Borrower Materials that are not
marked “PUBLIC” as being suitable only for posting on a portion of the Platform
not designated “Public Investor.” 
Notwithstanding the foregoing, the Borrower shall be under no obligation
to mark any Borrower Materials “PUBLIC.”


 


ARTICLE VIII


 


FINANCIAL COVENANTS


 


So
long as any Advance shall remain unpaid, any Letter of Credit shall be
outstanding or any Lender Party shall have any Commitment hereunder, the
Borrower and its Subsidiaries on a Consolidated basis, will:


 


Section 8.1            Minimum
EBITDA.


 


Maintain
for each period set forth below EBITDA at not less than the respective amounts
set forth below:


 


	
  Four Fiscal Quarters ending on:

  	
   

  	
  Minimum EBITDA

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  October 31, 2005 and each fiscal
  quarter thereafter through and including April 30, 2006

  	
   

  	
  $

  	
  25,000,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  July 31, 2006 and each fiscal quarter
  thereafter through and including October 31, 2006

  	
   

  	
  $

  	
  20,000,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  January 31, 2007 and each fiscal
  quarter thereafter through and including July 31, 2007

  	
   

  	
  $

  	
  22,000,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  October 31, 2007 and each fiscal
  quarter thereafter through and including July 31, 2008

  	
   

  	
  $

  	
  25,000,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  October 31, 2008 and each fiscal
  quarter thereafter

  	
   

  	
  $

  	
  30,000,000

  	
   

  



 


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Section 8.2            Consolidated Debt to EBITDA Ratio.


 


Maintain
as of the end of each fiscal quarter of the Borrower a ratio of Consolidated
Debt to EBITDA for the most recently completed four fiscal quarters of the
Borrower of not more than the ratio set forth below:


 


	
  Four Fiscal Quarters ending on:

  	
   

  	
  Ratio

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  October 31, 2005 and each fiscal
  quarter thereafter through and including April 30, 2006

  	
   

  	
  2.50 to 1.0

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  July 31, 2006 and each fiscal quarter
  thereafter through and including July 31, 2007

  	
   

  	
  2.75 to 1.0

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  October 31, 2007 and each fiscal
  quarter thereafter through and including July 31, 2008

  	
   

  	
  2.50 to 1.0

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  October 31, 2008 and each fiscal
  quarter thereafter

  	
   

  	
  2.25 to 1.0

  	
   

  



 


Section 8.3            Fixed
Charge Coverage Ratio.


 


Maintain
as of the end of each fiscal quarter of the Borrower a ratio of (i) EBITDA
for the most recently completed four fiscal quarters of the Borrower, less
Capital Expenditures made by the Borrower and its Subsidiaries during such
period, less the aggregate amount of federal, state, local and foreign
taxes paid or accrued by the Borrower and its Subsidiaries during such period,
to the (ii) sum of (x) Interest Expense paid or payable by its terms
by the Borrower and its Subsidiaries on all Debt during such period plus
(y) principal amounts of all Debt paid or payable by its terms by the
Borrower and its Subsidiaries during such period (other than the Interim Term
Loan and Debt owed by Crosstex to JPMorgan Chase Bank that is repaid on the
Closing Date)  plus (z) cash
dividends paid or accrued by the Borrower to the holders of its common stock
during such period, of not less than 1.25 to 1.0.


 


ARTICLE IX


 


EVENTS OF DEFAULT


 


If
any of the following (“Events of Default”) shall occur and be
continuing:


 


Section 9.1            Payment.


 


(a)           The
Borrower shall fail to pay any principal of any Advance when the same shall
become due and payable or (b) the Borrower shall fail to pay any interest
on any Advance, or any Loan Party shall fail to make any other payment under
any Loan Document, in each case under this clause (b) within
two (2) Business Days after the same becomes due and payable; or


 


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Section 9.2            Representations and Warranties.


 


Any
representation or warranty made by any Loan Party (or any of its officers)
under or in connection with any Loan Document shall prove to have been
incorrect in any material respect when made or confirmed; or


 


Section 9.3            Certain
Covenants.


 


The
Borrower shall fail to perform or observe any term, covenant or agreement
contained in Section 2.14, 5.5, 5.6, 5.7, 5.13
or 5.14, Article VI or Article VIII; or


 


Section 9.4            Other
Covenants.


 


Any
Loan Party shall fail to perform any other term, covenant or agreement
contained in any Loan Document on its part to be performed or observed if such
failure shall remain unremedied for thirty (30) days after the earlier of
the date on which (a) a Responsible Officer of any Loan Party becomes
aware of such failure or (b) written notice thereof shall have been given
to the Borrower by the Administrative Agent or any Lender Party; or


 


Section 9.5            Other
Defaults.


 


Any
Loan Party or any of its Subsidiaries shall fail to pay any principal of,
premium or interest on or any other amount payable in respect of any Debt that
is outstanding in a principal or notional amount of at least $100,000 either
individually or in the aggregate (but excluding Debt outstanding hereunder) of
such Loan Party or such Subsidiary (as the case may be), when the same becomes
due and payable (whether by scheduled maturity, required prepayment,
acceleration, demand or otherwise); or any other event shall occur or condition
shall exist under any agreement or instrument relating to any such Debt, in
each case if the effect of such event or condition is to accelerate, or to
permit the acceleration of, the maturity of such Debt or otherwise to cause, or
to permit the holder thereof to cause, such Debt to mature; or any such Debt
shall be declared to be due and payable or required to be prepaid or redeemed
(other than by a regularly scheduled required prepayment or redemption),
purchased or defeased, or an offer to prepay, redeem, purchase or defease such
Debt shall be required to be made, in each case prior to the stated maturity
thereof; or


 


Section 9.6            Bankruptcy,
Etc.


 


Any
Loan Party or any of its Subsidiaries shall generally not pay its debts as such
debts become due, or shall admit in writing its inability to pay its debts
generally, or shall make a general assignment for the benefit of creditors; or
any proceeding shall be instituted by or against any Loan Party or any of its
Subsidiaries seeking to adjudicate it a bankrupt or insolvent, or seeking
liquidation, winding up, reorganization, arrangement, adjustment, protection,
relief, or composition of it or its debts under any law relating to bankruptcy,
insolvency or reorganization or relief of debtors, or seeking the entry of an
order for relief or the appointment of a receiver, trustee or other similar
official for it or for any substantial part of its property and, in the case of
any such proceeding instituted against it (but not instituted by it) that is
being diligently contested by it in good faith, either such proceeding shall
remain undismissed or unstayed for a period of sixty (60) days or any of
the actions sought in such proceeding (including, without limitation, the entry
of an order for relief against, or the appointment of a receiver, trustee, custodian
or other similar official for, it or any substantial part of its property)
shall occur, or any Loan Party or any of its Subsidiaries shall take any
corporate action to authorize any of the actions set forth above in this Section 9.6
(other than in respect of the Carsen Disposition); or


 


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Section 9.7            Judgments.


 


(a)           Any
judgment or order for the payment of money in excess of $250,000 (other than
such a judgment or order as to which all amounts in excess of $250,000 are
covered by insurance for which the appropriate insurer has acknowledged
responsibility in writing) shall be rendered against any Loan Party or any of
its Subsidiaries and either (i) enforcement proceedings shall have been
commenced by any creditor upon such judgment or order or (ii) there shall
be a period of seven (7) consecutive days during which a stay of
enforcement of such judgment or order, by reason of a pending appeal or
otherwise, shall not be in effect; or


 


(b)           Any
non-monetary judgment or order shall be rendered against any Loan Party or any
of its Subsidiaries that is reasonably likely to have a Material Adverse
Effect; or


 


Section 9.8            Loan
Documents.


 


Any
material provision of any Loan Document after delivery thereof shall for any
reason cease to be valid and binding on or enforceable against any Loan Party
which is party to it, or any such Loan Party shall so state in writing; or


 


Section 9.9            Liens.


 


Any
Collateral Document after delivery thereof shall for any reason cease to or
otherwise not create a valid and perfected first priority lien on and security
interest in the Collateral purported to be covered thereby; or


 


Section 9.10         Change of
Control.


 


Any
Change of Control shall occur; or


 


Section 9.11         ERISA Events.


 


(a)           Any
ERISA Event shall have occurred with respect to a Plan and the sum (determined
as of the date of occurrence of the last such ERISA Event) of the Insufficiency
of such Plan and the Insufficiency of any and all other Plans with respect to
which an ERISA Event shall have occurred and then exist (or the liability of
the Loan Parties and the ERISA Affiliates related to such ERISA Events) exceeds
$100,000; or


 


(b)           Any
Loan Party or any ERISA Affiliate shall have been notified by the sponsor of a
Multiemployer Plan that it has incurred Withdrawal Liability to such
Multiemployer Plan in an amount that, when aggregated with all other amounts
required to be paid to Multiemployer Plans by the Loan Parties and the ERISA
Affiliates as Withdrawal Liability (determined as of the date of such
notification), exceeds $100,000 or requires payments exceeding $100,000 per
annum; or


 


(c)           Any
Loan Party or any ERISA Affiliate shall have been notified by the sponsor of a
Multiemployer Plan that such Multiemployer Plan is in reorganization or is
being terminated, within the meaning of Title IV of ERISA, and as a result
of such reorganization or termination the aggregate annual contributions of the
Loan Parties and the ERISA Affiliates to all Multiemployer Plans that are then
in reorganization or being terminated have been or will be increased over the
amounts contributed to such Multiemployer Plans for the plan years of such
Multiemployer Plans immediately preceding the plan year in which such
reorganization or termination occurs by an amount exceeding $100,000;


 


78





















 


then,
and in any such event, the Administrative Agent (i) shall at the request,
or may with the consent, of the Required Lenders, by notice to the Borrower,
declare the Commitments of each appropriate Lender (other than the Commitment
in respect of Letter of Credit Advances by the Issuing Bank or a Revolving
Credit Lender pursuant to Section 2.3(c) and Swing Line
Advances by a Revolving Credit Lender pursuant to Section 2.2(b))
and of the Issuing Bank to issue Letters of Credit to be terminated, whereupon
the same shall forthwith terminate, and (ii) shall at the request, or may
with the consent, of the Required Lenders, (A) by notice to the Borrower,
declare the Notes, all interest thereon and all other amounts payable under
this Agreement and the other Loan Documents to be forthwith due and payable,
whereupon the Notes, all such interest and all such other amounts shall become
and be forthwith due and payable, without presentment, demand, protest or
further notice of any kind, all of which are hereby expressly waived by the
Borrower, (B) by notice to each party required under the terms of any
agreement in support of which a Standby Letter of Credit is issued, request
that all Obligations under such agreement be declared to be due and payable; provided,
however, that in the event of an actual or deemed entry of an order for
relief with respect to any Loan Party or any of its Subsidiaries under the
Federal Bankruptcy Code, (x) the obligation of each Lender to make
Advances (other than Letter of Credit Advances by the Issuing Bank or a
Revolving Credit Lender pursuant to Section 2.3(c) and Swing
Line Advances by a Revolving Credit Lender pursuant to Section 2.2(b))
and of the Issuing Bank to issue Letters of Credit shall automatically be
terminated and (y) the Notes, all such interest and all such amounts shall
automatically become and be due and payable, without presentment, demand,
protest or any notice of any kind, all of which are hereby expressly waived by
the Borrower and (C) pursue any and all rights and remedies available
under this Agreement or the other Loan Documents.


 


If
any Event of Default shall have occurred and be continuing, the Administrative
Agent may, or shall at the request of the Required Lenders, irrespective of
whether it is taking any of the actions described in Article IX or
otherwise, make demand upon the Borrower to, and forthwith upon such demand the
Borrower will, pay to the Administrative Agent on behalf of the Lender Parties
in same day funds at the Administrative Agent’s office designated in such
demand, for deposit in the L/C Cash Collateral Account, an amount equal to the
aggregate Available Amount of all Letters of Credit then outstanding.  If at any time the Administrative Agent
determines that any funds held in the L/C Cash Collateral Account are subject
to any right or claim of any Person other than the Administrative Agent and the
Lender Parties or that the total amount of such funds is less than the aggregate
Available Amount of all Letters of Credit, the Borrower will, forthwith upon
demand by the Administrative Agent, pay to the Administrative Agent, as
additional funds to be deposited and held in the L/C Cash Collateral Account,
an amount equal to the excess of (a) such aggregate Available Amount over (b) the
total amount of funds, if any, then held in the L/C Cash Collateral Account
that the Administrative Agent determines to be free and clear of any such right
and claim.


 


After
the exercise of remedies described above (or after the Advances have
automatically become immediately due and payable and the Letters of Credit have
been required to be cash collateralized as set forth above), any amounts
received on account of the Obligations shall be applied by the Administrative
Agent in the following order:


 


First, to payment of that portion of the Obligations constituting fees,
indemnities, expenses and other amounts (including fees, charges and
disbursements of counsel to the Administrative Agent) payable to the
Administrative Agent in its capacity as such;


 


Second, to payment of that portion of the Obligations constituting fees,
indemnities and other amounts (other than principal, interest and Letter of
Credit Fees) payable to the Lenders and the Issuing Bank (including fees,
charges and disbursements of counsel to the respective Lenders and the Issuing
Bank), ratably among them in proportion to the respective amounts described in
this clause Second payable to them;


 


79





















 


Third, to payment of that portion of the Obligations constituting accrued
and unpaid Letter of Credit fees and interest on the Advances and Letter of
Credit Advances and fees, premiums and
scheduled periodic payments, and any interest accrued thereon, due under any
Bank Hedge Agreement, ratably among the Lender Parties (and, in the case
of such Bank Hedge Agreements and Treasury Management Agreements, Affiliates of
Lenders) and the Issuing Bank in proportion to the respective amounts described
in this clause Third held by them;


 


Fourth, to (a) payment of that portion of the Obligations constituting
unpaid principal of the Advances and Letter of Credit Advances, (b) payment
of breakage, termination or other payments,
and any interest accrued thereon, due under any Bank Hedge Agreement, (c) payments
of amounts due under any Treasury
Management Agreement and (d) cash collateralize the aggregate
undrawn amount of Letters of Credit, ratably among the Lender Parties (and, in
the case of such Bank Hedge Agreements and Treasury Management Agreements,
Affiliates of Lenders) and the Issuing Bank in proportion to the respective
amounts described in this clause Fourth held by them; and


 


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


 


Amounts
used to cash collateralize the aggregate undrawn amount of Letters of Credit
pursuant to clause Fourth above shall be applied to satisfy drawings
under such Letters of Credit as they occur. 
If any amount remains on deposit as cash collateral after all Letters of
Credit have either been fully drawn or expired, such remaining amount shall be
applied to the other Obligations, if any, in the order set forth above.


 


ARTICLE X


 


THE ADMINISTRATIVE AGENT


 


Section 10.1         Appointment
and Authority.


 


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


 


Section 10.2         Rights as
a Lender.


 


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


 


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Section 10.3         Exculpatory
Provisions.


 


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


 


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


 


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


 


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


 


The
Administrative Agent shall not be liable for any action taken or not taken by
it (i) with the consent or at the request of the Required Lenders (or such
other number or percentage of the Lenders as shall be necessary, or as the
Administrative Agent shall believe in good faith shall be necessary, under the
circumstances as provided in Section 11.1 and Article IX)
or (ii) in the absence of its own gross negligence or willful
misconduct.  The Administrative Agent
shall be deemed not to have knowledge of any Default (other than a Default
caused by the Borrower’s failure to pay Obligations consisting of principal,
interest or fees directly to the Administrative Agent, for the account of the
Lenders, in accordance with the express terms of this Agreement) unless and
until notice describing such Default is given to the Administrative Agent by
the Borrower or a Lender Party.


 


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


 


Section 10.4         Reliance by Administrative Agent.


 


The
Administrative Agent shall be entitled to rely upon, and shall not incur any
liability for relying upon, any notice, request, certificate, consent,
statement, instrument, document or other writing (including any electronic
message, Internet or intranet website posting or other distribution) believed
by it to be genuine and to have been signed, sent or otherwise authenticated by
the proper Person.  The Administrative
Agent also may rely upon any statement made to it orally or by telephone and
believed by


 


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it to have been made by the
proper Person, and shall not incur any liability for relying thereon.  In determining compliance with any condition
hereunder to the making of a Borrowing, or the issuance of a Letter of Credit,
that by its terms must be fulfilled to the satisfaction of a Lender Party, the
Administrative Agent may presume that such condition is satisfactory to such
Lender Party unless the Administrative Agent shall have received notice to the
contrary from such Lender Party prior to the making of such Borrowing or the
issuance of such Letter of Credit.  The
Administrative Agent may consult with legal counsel (who may be counsel for the
Loan Parties), independent accountants and other experts selected by it, and
shall not be liable for any action taken or not taken by it in accordance with
the advice of any such counsel, accountants or experts.


 


Section 10.5         Delegation
of Duties.


 


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


 


Section 10.6         Resignation of Administrative Agent.


 


The
Administrative Agent may at any time give notice of its resignation to the
Lender Parties and the Borrower.  Upon
receipt of any such notice of resignation, the Required Lenders shall have the
right, in consultation with the Borrower, to appoint a successor, which shall
be a bank with an office in the United States, or an Affiliate of any such bank
with an office in the United States.  If
no such successor shall have been so appointed by the Required Lenders and
shall have accepted such appointment within 30 days after the retiring
Administrative Agent gives notice of its resignation, then the retiring Administrative
Agent may on behalf of the Lender Parties, appoint a successor Administrative
Agent meeting the qualifications set forth above; provided that if the
Administrative Agent shall notify the Borrower and the Lenders that no
qualifying Person has accepted such appointment, then such resignation shall
nonetheless become effective in accordance with such notice and (1) the
retiring Administrative Agent shall be discharged from its duties and
obligations hereunder and under the other Loan Documents (except that in the
case of any collateral security held by the Administrative Agent on behalf of
the Lender Parties under any of the Loan Documents, the retiring Administrative
Agent shall continue to hold such collateral security until such time as a
successor Administrative Agent is appointed) and (2) all payments,
communications and determinations provided to be made by, to or through the
Administrative Agent shall instead be made by or to each Lender Parties
directly, until such time as the Required Lenders appoint a successor
Administrative Agent as provided for above in this Section.  Upon the acceptance of a successor’s
appointment as Administrative Agent hereunder, such successor shall succeed to
and become vested with all of the rights, powers, privileges and duties of the
retiring (or retired) Administrative Agent, and the retiring Administrative
Agent shall be discharged from all of its duties and obligations hereunder or
under the other Loan Documents (if not already discharged therefrom as provided
above in this Section).  The fees payable
by the Borrower to a successor Administrative Agent shall be the same as those
payable to its predecessor unless otherwise agreed between the Borrower and
such successor.  After the retiring
Administrative Agent’s resignation hereunder and under the other Loan
Documents, the provisions of this Article and Section 11.4
shall continue in effect for the benefit of such retiring Administrative Agent,
its sub-agents and their respective Related Parties in respect of any actions
taken or omitted to be taken by any of them while the retiring Administrative
Agent was acting as Administrative Agent.


 


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


 


Section 10.7         Non-Reliance on Administrative
Agent and Other Lenders.


 


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


 


Section 10.8         No Other
Duties; Etc.


 


Anything
herein to the contrary notwithstanding, none of the bookrunners, arrangers, syndication
agents, documentation agents or co-agents shall have any powers, duties or
responsibilities under this Agreement or any of the other Loan Documents,
except in its capacity, as applicable, as the Administrative Agent or a Lender
Party hereunder.


 


Section 10.9         Administrative Agent May File
Proofs of Claim.


 


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


 


(a)           to file and prove a claim for the
whole amount of the principal and interest owing and unpaid in respect of the
Obligations of the Loan Parties under the Loan Documents (other than
Obligations under Bank Hedge Agreements or Treasury Management Agreements to which the Administrative Agent is not a party) 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 Lender Parties and the
Administrative Agent (including any claim for the reasonable compensation,
expenses, disbursements and advances of the Lender Parties and the
Administrative Agent and their respective agents and counsel and all other
amounts due the Lender Parties and the Administrative Agent under Sections
2.8 and 11.4) 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;


 


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and
any custodian, receiver, assignee, trustee, liquidator, sequestrator or other
similar official in any such judicial proceeding is hereby authorized by each
Lender Party to make such payments to the Administrative Agent and, in the
event that the Administrative Agent shall consent to the making of such
payments directly to the Lender Parties, to pay to the Administrative Agent any
amount due for the reasonable compensation, expenses, disbursements and
advances of the Administrative Agent and its agents and counsel, and any other
amounts due the Administrative Agent under Sections 2.8 and 11.4.


 


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 Party any plan of
reorganization, arrangement, adjustment or composition affecting the
Obligations or the rights of any Lender Party or to authorize the
Administrative Agent to vote in respect of the claim of any Lender Party in any
such proceeding.


 


Section 10.10       Collateral
and Guaranty Matters.


 


The
Lender Parties irrevocably authorize the Administrative Agent, at its option
and in its discretion,


 


(a)           to release any Lien on any Collateral
granted to or held by the Administrative Agent under any Loan Document (i) upon
termination of the Commitments and payment in full of all Obligations of the
Loan Parties under the Loan Documents (other than contingent indemnification
obligations) and the expiration or termination of all Letters of Credit, (ii) that
is transferred or to be transferred as part of or in connection with any
disposition of assets permitted hereunder or under any other Loan Document or
any casualty or condemnation event, or (iii) as approved in accordance
with Section 11.1;


 


(b)           to subordinate any Lien on any
property granted to or held by the Administrative Agent under any Loan Document
to the holder of any Lien on such property that is permitted by subsections (d) and
(e) of Section 6.1; and


 


(c)           to release any Guarantor from its
obligations under the Guaranty if such Person ceases to be a Subsidiary as a
result of a transaction permitted hereunder.


 


Upon
request by the Administrative Agent at any time, the Required Lenders will confirm
in writing the Administrative Agent’s authority to release or subordinate its
interest in particular types or items of property, or to release any Guarantor
from its obligations under the Guaranty, pursuant to this Section 10.10.


 


ARTICLE XI


 


MISCELLANEOUS


 


Section 11.1         Amendments,
Etc.


 


No
amendment or waiver of any provision of this Agreement or any other Loan
Document, and no consent to any departure by the Borrower or any other Loan
Party therefrom, shall be effective unless in writing signed by the Required
Lenders and the Borrower or the applicable Loan Party, as the case may be, and
acknowledged by the Administrative Agent, and each such waiver or consent shall
be effective only in the specific instance and for the specific purpose for
which given; provided, further, that


 


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(a)           no
such amendment, waiver or consent shall:


 


(i)            extend or increase the Commitment of
a Lender (or reinstate any Commitment terminated pursuant to Article IX)
without the written consent of such Lender whose Commitment is being extended
or increased (it being understood and agreed that a waiver of any condition
precedent set forth in Section 3.2 or of any Default or a mandatory
reduction in Commitments is not considered an extension or increase in
Commitments of any Lender);


 


(ii)           postpone any date fixed by this
Agreement or any other Loan Document for any payment of principal (excluding
mandatory prepayments), interest, fees or other amounts due to the Lenders (or
any of them) or any scheduled or mandatory reduction of the Commitments
hereunder or under any other Loan Document without the written consent of each
Lender entitled to receive such payment or whose Commitments are to be reduced;


 


(iii)          reduce the principal of, or the rate
of interest specified herein on, any Advance or Notes, or (subject to clause (i) of
the final proviso to this Section 11.1) any fees or other amounts
payable hereunder or under any other Loan Document without the written consent
of each Lender entitled to receive such payment of principal, interest, fees or
other amounts; provided, however, that only the consent of the
Required Lenders shall be necessary to (A) amend the definition of “Default
Rate” or to waive any obligation of the Borrower to pay interest or Letter of
Credit fees at the Default Rate or (B) to amend any financial covenant
hereunder (or any defined term used therein) even if the effect of such
amendment would be to reduce the rate of interest on any Advance or Note or to
reduce any fee payable hereunder;


 


(iv)          change Section 2.13 in a
manner that would alter the pro rata sharing of payments required thereby
without the written consent of each Lender directly affected thereby;


 


(v)           change any provision of this Section 11.1(a) or
the definition of “Required Lenders” without the written consent of each Lender
directly affected thereby;


 


(vi)          except in connection with a
disposition of assets permitted under Section 6.5, release all or
substantially all of the Collateral without the written consent of each Lender
whose Obligations are secured by such Collateral;


 


(vii)         release the Borrower or, except in
connection with a merger or consolidation permitted under Section 6.4
or a disposition of assets permitted under Section 6.5, all or
substantially all of the value of the Guaranty without the written consent of
each Lender whose Obligations are guarantied thereby; or


 


(b)           unless also signed by the Issuing
Bank, no amendment, waiver or consent shall affect the rights or duties of the
Issuing Bank under this Agreement or any Issuer Document relating to any Letter
of Credit issued or to be issued by it;


 


(c)           unless also signed by the Swing Line
Bank, no amendment, waiver or consent shall affect the rights or duties of the
Swing Line Bank under this Agreement; and


 


(d)           unless also signed by the
Administrative Agent, no amendment, waiver or consent shall affect the rights
or duties of the Administrative Agent under this Agreement or any other Loan
Document;


 


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provided, however,
that notwithstanding anything to the contrary herein, (i) the Fee Letter
may be amended, or rights or privileges thereunder waived, in a writing
executed only by the parties thereto, (ii) no Defaulting Lender shall have
any right to approve or disapprove any amendment, waiver or consent hereunder,
except that the Commitment of such Lender may not be increased or extended
without the consent of such Lender, (iii) each Lender is entitled to vote
as such Lender sees fit on any bankruptcy reorganization plan that affects the
Loans, and each Lender acknowledges that the provisions of Section 1126(c) of
the Federal Bankruptcy Code supersedes the unanimous consent provisions set
forth herein and (iv) the Required Lenders shall determine whether or not
to allow a Loan Party to use cash collateral in the context of a bankruptcy or
insolvency proceeding and such determination shall be binding on all of the
Lenders.


 


Section 11.2         Notices Etc.


 


(a)           Notices
Generally.  Except in the case of notices
and other communications expressly permitted to be given by telephone (and
except as provided in subsection (b) below), all notices and other
communications provided for herein shall be in writing and shall be delivered
by hand or overnight courier service, mailed by certified or registered mail or
sent by telecopier as follows, and all notices and other communications
expressly permitted hereunder to be given by telephone shall be made to the
applicable telephone number, as follows:


 


(i)            if
to the Borrower or any other Loan Party, the Administrative Agent, the Issuing
Bank or the Swing Line Bank, to the address, telecopier number, electronic mail
address or telephone number specified for such Person on Schedule 11.2;
and


 


(ii)           if
to any other Lender, to the address, telecopier number, electronic mail address
or telephone number specified in its Administrative Questionnaire.


 


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


 


(b)           Electronic
Communications.  Notices and other
communications to the Lender Parties 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 Party pursuant to Article II
if such Lender Party has notified the Administrative Agent that it is incapable
of receiving notices under such Article by electronic communication.  The Administrative Agent or the Borrower may,
in its discretion, agree to accept notices and other communications to it
hereunder by electronic communications pursuant to procedures approved by it, provided
that approval of such procedures may be limited to particular notices or
communications.


 


Unless
the Administrative Agent otherwise prescribes, (i) notices and other
communications sent to an e-mail address shall be deemed received upon the
sender’s receipt of an acknowledgement from the intended recipient (such as by
the “return receipt requested” function, as available, return e-mail or other
written acknowledgement), provided that if such notice or other
communication is not sent during the normal business hours of the recipient,
such notice or communication shall be deemed to have been sent at the opening
of business on the next business day for the recipient, and (ii) notices
or communications posted to an Internet or intranet website shall be deemed
received upon the deemed receipt by the


 


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intended recipient at its
e-mail address as described in the foregoing clause (i) of
notification that such notice or communication is available and identifying the
website address therefor.


 


(c)           The
Platform.  THE PLATFORM IS
PROVIDED “AS IS” AND “AS AVAILABLE.”  THE
AGENT PARTIES (AS DEFINED BELOW) DO NOT WARRANT THE ACCURACY OR COMPLETENESS OF
THE BORROWER MATERIALS OR THE ADEQUACY OF THE PLATFORM, AND EXPRESSLY DISCLAIM
LIABILITY FOR ERRORS IN OR OMISSIONS FROM THE BORROWER MATERIALS.  NO WARRANTY OF ANY KIND, EXPRESS, IMPLIED OR
STATUTORY, INCLUDING ANY WARRANTY OF MERCHANTABILITY, FITNESS FOR A PARTICULAR
PURPOSE, NON-INFRINGEMENT OF THIRD PARTY RIGHTS OR FREEDOM FROM VIRUSES OR
OTHER CODE DEFECTS, IS MADE BY ANY AGENT PARTY IN CONNECTION WITH THE BORROWER
MATERIALS OR THE PLATFORM.  In no event
shall the Administrative Agent or any of its Related Parties (collectively, the
“Agent Parties”) have any liability to the Borrower, any Lender Party or
any other Person for losses, claims, damages, liabilities or expenses of any
kind (whether in tort, contract or otherwise) arising out of the Borrower’s or
the Administrative Agent’s transmission of Borrower Materials through the
Internet, except to the extent that such losses, claims, damages, liabilities
or expenses are determined by a court of competent jurisdiction by a final and
nonappealable judgment to have resulted from the gross negligence or willful
misconduct of such Agent Party; provided, however, that in no
event shall any Agent Party have any liability to the Borrower, any Lender
Party or any other Person for indirect, special, incidental, consequential or
punitive damages (as opposed to direct or actual damages).


 


(d)           Change
of Address, Etc.  Each of the
Borrower, the Administrative Agent, the Issuing Bank and the Swing Line Bank
may change its address, telecopier or telephone number for notices and other
communications hereunder by notice to the other parties hereto.  Each other Lender may change its address,
telecopier or telephone number for notices and other communications hereunder
by notice to the Borrower, the Administrative Agent, the Issuing Bank and the
Swing Line Bank.  In addition, each
Lender agrees to notify the Administrative Agent from time to time to ensure
that the Administrative Agent has on record (i) an effective address,
contact name, telephone number, telecopier number and electronic mail address
to which notices and other communications may be sent and (ii) accurate
wire instructions for such Lender.


 


(e)           Reliance
by Administrative Agent and Lender Parties.  The Administrative Agent and the
Lender Parties shall be entitled to rely and act upon any notices (including
telephonic Notices of Borrowing and Notices of Swing Line Borrowing)
purportedly given by or on behalf of any Loan Party 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 Loan Parties shall indemnify
the Administrative Agent, each Lender Party and the Related Parties of each of
them from all losses, costs, expenses and liabilities resulting from the
reliance by such Person on each notice purportedly given by or on behalf of a
Loan Party.  All telephonic notices to
and other telephonic communications with the Administrative Agent may be
recorded by the Administrative Agent, and each of the parties hereto hereby
consents to such recording.


 


Section 11.3         No
Waiver; Remedies.


 


No
failure on the part of any Lender Party or the Administrative Agent to
exercise, and no delay in exercising, any right hereunder or under any Note or
under any other Loan Document shall operate as a waiver thereof, nor shall any
single or partial exercise of any such right preclude any other or further
exercise thereof or the exercise of any other right.  Administrative Agent’s and Lenders’ rights
and remedies under this Agreement shall be cumulative and nonexclusive of any
other rights and remedies


 


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that Agent or any Lender may
have under any other agreement, including the other Loan Documents, by
operation of law or otherwise.  Recourse
to the Collateral shall not be required.


 


Section 11.4         Expenses; Indemnity; and Damage
Waiver.


 


(a)           Costs
and Expenses.  The Borrower shall pay
(i) all reasonable out-of-pocket expenses incurred by the Administrative
Agent and its Affiliates (including the reasonable fees, charges and
disbursements of counsel for the Administrative Agent), in connection with the
syndication of the credit facilities provided for herein, the preparation,
negotiation, execution, delivery and administration of this Agreement and the
other Loan Documents or any amendments, modifications or waivers of the
provisions hereof or thereof (whether or not the transactions contemplated
hereby or thereby shall be consummated), (ii) all reasonable out-of-pocket
expenses incurred by the Issuing Bank in connection with the issuance,
amendment, renewal or extension of any Letter of Credit or any demand for
payment thereunder and (iii) all reasonable out-of-pocket expenses
incurred by the Administrative Agent or any Lender Party (including the
reasonable fees, charges and disbursements of any counsel for the
Administrative Agent or any Lender Party), and shall pay all reasonable fees
and time charges for attorneys who may be employees of the Administrative Agent
or any Lender Party, in connection with the enforcement or protection of its
rights (A) in connection with this Agreement and the other Loan Documents,
including its rights under this Section, or (B) in connection with the
Advances made or Letters of Credit issued hereunder, including all such
reasonable out-of-pocket expenses incurred during any workout, restructuring or
negotiations in respect of such Advances or Letters of Credit.


 


(b)           Indemnification.  The Borrower shall indemnify the
Administrative Agent (and any sub-agent thereof) and each Lender Party, and
each Related Party of any of the foregoing Persons (each such Person being
called an “Indemnitee”) against, and hold each Indemnitee harmless from,
any and all losses, claims, damages, liabilities and related expenses
(including the fees, charges and disbursements of any counsel for any
Indemnitee), and shall indemnify and hold harmless each Indemnitee from all
fees and time charges and disbursements for attorneys who may be employees of
any Indemnitee, incurred by any Indemnitee or asserted against any Indemnitee
by any third party or by the Borrower or any other Loan Party arising out of,
in connection with, or as a result of (i) the execution or delivery of
this Agreement, any other Loan Document or any agreement or instrument
contemplated hereby or thereby, the performance by the parties hereto of their
respective obligations hereunder or thereunder or the consummation of the
transactions contemplated hereby or thereby, or, in the case of the
Administrative Agent (and any sub-agent thereof) and its Related Parties only,
the administration of this Agreement and the other Loan Documents, (ii) any
Advance or Letter of Credit or the use or proposed use of the proceeds
therefrom (including any refusal by the Issuing Bank to honor a demand for
payment under a Letter of Credit if the documents presented in connection with
such demand do not strictly comply with the terms of such Letter of Credit), (iii) any
actual or alleged presence or release of Hazardous Materials on or from any
property owned or operated by a Loan Party or any of its Subsidiaries, or any
liability under Environmental Laws related in any way to a Loan Party or any of
its Subsidiaries, or (iv) any actual or prospective claim, litigation,
investigation or proceeding relating to any of the foregoing, whether based on
contract, tort or any other theory, whether brought by a third party or by the
Borrower or any other Loan Party, and regardless of whether any Indemnitee is a
party thereto; provided that such indemnity shall not, as to any
Indemnitee, be available to the extent that such losses, claims, damages, liabilities
or related expenses (x) are determined by a court of competent
jurisdiction by final and nonappealable judgment to have resulted from the
gross negligence or willful misconduct of such Indemnitee or (y) result
from a claim brought by the Borrower or any other Loan Party against an
Indemnitee for breach in bad faith of such Indemnitee’s obligations hereunder
or under any other Loan Document, if the Borrower or such Loan Party has
obtained a final and nonappealable judgment in its favor on such claim as
determined by a court of competent jurisdiction.


 


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(c)           Reimbursement
by Lenders.  To the extent that the
Borrower or the other Loan Parties for any reason fail to indefeasibly pay any
amount required under subsection (a) or (b) of this Section to
be paid by them to the Administrative Agent (or any sub-agent thereof), the
Issuing Bank or any Related Party of any of the foregoing, each Lender
severally agrees to pay to the Administrative Agent (or any such sub-agent),
the Issuing Bank or such Related Party, as the case may be, such Lender’s Pro
Rata Share (determined as of the time that the applicable unreimbursed expense
or indemnity payment is sought) of such unpaid amount, provided that the
unreimbursed expense or indemnified loss, claim, damage, liability or related
expense, as the case may be, was incurred by or asserted against the
Administrative Agent (or any such sub-agent) or the Issuing Bank in its
capacity as such, or against any Related Party of any of the foregoing acting
for the Administrative Agent (or any such sub-agent) or Issuing Bank in
connection with such capacity.  The
obligations of the Lenders under this subsection (c) are subject to
the provisions of Section 2.2(f).


 


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


 


(e)           Breakage
Costs.  If any payment of principal
of, or Conversion of, any Eurodollar Rate Advance is made by the Borrower to or
for the account of a Lender Party other than on the last day of the Interest
Period for such Advance, as a result of a payment or Conversion pursuant to Section 2.9(b)(i) or 2.10(d) or
a prepayment pursuant to Section 2.6(a) or (b),
acceleration of the maturity of the Notes pursuant to Article IX or
for any other reason, the Borrower shall, upon demand by such Lender Party
(with a copy of such demand to the Administrative Agent), pay to the
Administrative Agent for the account of such Lender Party any amounts required
to compensate such Lender Party for any additional losses, costs or expenses
that it may reasonably incur as a result of such payment, including, without
limitation, any loss (including loss of anticipated profits), cost or expense
incurred by reason of the liquidation or re-employment of deposits or other
funds required by any Lender Party to fund or maintain such Advance.


 


(f)            Payments.  All amounts due under this Section shall
be payable not later than ten Business Days after demand therefor.


 


(g)           Survival.  The agreements in this Section shall
survive the resignation of the Administrative Agent and the Issuing Bank, the
replacement of any Lender, the termination of the Commitments and the repayment,
satisfaction or discharge of all the other Obligations.


 


Section 11.5         Right of
Set-off.


 


Upon
(a) the occurrence and during the continuance of any Event of Default and (b) the
making of the request or the granting of the consent specified by Article IX
to authorize the Administrative Agent to declare the Notes due and payable
pursuant to the provisions of Article IX, each Lender Party and
each of its respective Affiliates is hereby authorized at any time and from
time to time, to the fullest extent permitted by law, to set off and otherwise
apply any and all deposits (general or special, time or demand, provisional or
final) at any time held and other indebtedness at any time owing by such Lender
Party or


 


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such Affiliate to or for the
credit or the account of the Borrower or any of its Subsidiaries against any
and all of the Obligations of the Borrower now or hereafter existing under this
Agreement and the Note or Notes (if any) held by such Lender Party,
irrespective of whether such Lender Party shall have made any demand under this
Agreement or such Note or Notes and although such obligations may be
unmatured.  Each Lender Party agrees
promptly to notify the Borrower and the Administrative Agent after any such
set-off and application; provided, however, that the failure to
give such notice shall not affect the validity of such set-off and
application.  The rights of each Lender
Party and its respective Affiliates under this Section are in addition to other
rights and remedies (including, without limitation, other rights of set-off)
that such Lender Party and its respective Affiliates may have at law, in equity
or otherwise.


 


Section 11.6         Amendment and Restatement of
Existing Credit Agreement.


 


The
Borrower and the Lender Parties party to the Existing Credit Agreement each
hereby agrees that, at such time as this Agreement shall have become effective
pursuant to the terms of Article III, (a) the Existing Credit
Agreement automatically shall be deemed amended and restated in its entirety by
this Credit Agreement, (b) the Commitments under the Existing Credit
Agreement and as defined therein automatically shall be replaced with the
Commitments hereunder and (c) all of the promissory notes executed by the
Borrower in connection with the Existing Credit Agreement automatically shall
be canceled and replaced with the Notes executed by the Borrower
hereunder.  This Agreement is not a
novation of the Existing Credit Agreement.


 


Section 11.7         Successors
and Assigns.


 


(a)           Successors
and Assigns Generally.  The
provisions of this Agreement and the other Loan Documents shall be binding upon
and inure to the benefit of the parties hereto and thereto 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 or
thereunder without the prior written consent of the Administrative Agent and
each Lender and no Lender may assign or otherwise transfer any of its rights or
obligations hereunder except (i) to an Eligible Assignee in accordance
with the provisions of 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 Agreement,
expressed or implied, shall be construed to confer upon any Person (other than
the parties hereto, their respective successors and assigns permitted hereby,
Participants to the extent provided in subsection (d) of this Section and,
to the extent expressly contemplated hereby, the Related Parties of each of the
Administrative Agent and the Lender Parties) any legal or equitable right,
remedy or claim under or by reason of this Agreement.


 


(b)           Assignments
by Lenders.  Any Lender may at any
time assign to one or more Eligible Assignees all or a portion of its rights
and obligations under this Agreement and the other Loan Documents (including
all or a portion of its Commitment and the Advances (including for purposes of
this subsection (b), participations in Letters of Credit and in Swing Line
Advances) at the time owing to it); provided that


 


(i)            except
in the case of an assignment of the entire remaining amount of the assigning
Lender’s Commitment and the Advances 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 Advances outstanding thereunder) or, if the Commitment is not
then in effect, the principal outstanding balance of the Advances of the
assigning Lender subject to each such assignment, determined as of the date the
Assignment and Assumption with respect to such assignment is delivered to the
Administrative


 


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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); provided, however, that concurrent assignments to
members of an Assignee Group and concurrent assignments from members of an
Assignee Group to a single Eligible Assignee (or to an Eligible Assignee and
members of its Assignee Group) will be treated as a single assignment for
purposes of determining whether such minimum amount has been met;


 


(ii)           each
partial assignment shall be made as an assignment of a proportionate part of
all the assigning Lender’s Advances and Commitments, and rights and obligations
with respect thereto, assigned, except that this clause (ii) shall not
apply to rights in respect of Swing Line Advances, the Term A Advances or the
Interim Term Advances;


 


(iii)          any
assignment of a Revolving Credit Commitment must be approved by the
Administrative Agent, the Issuing Bank and the Swing Line Bank 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 in the amount of $2,500, and the Eligible Assignee, if it shall not be a
Lender, shall deliver to the Administrative Agent an Administrative
Questionnaire.


 


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
Agreement and, to the extent of the interest assigned by such Assignment and
Assumption, have the rights and obligations of a Lender under this Agreement,
and the assigning Lender thereunder shall, to the extent of the interest
assigned by such Assignment and Assumption, be released from its obligations
under this Agreement (and, in the case of an Assignment and Assumption covering
all of the assigning Lender’s rights and obligations under this Agreement, such
Lender shall cease to be a party hereto but shall continue to be entitled to
the benefits of Sections 2.10, 2.12 and 11.4 with respect
to facts and circumstances occurring prior to the effective date of such
assignment).  Upon request, the Borrower
(at its expense) shall execute and deliver a Note to the assignee Lender.  Any assignment or transfer by a Lender of
rights or obligations under this Agreement that does not comply with this subsection shall
be treated for purposes of this Agreement as a sale by such Lender of a
participation in such rights and obligations in accordance with subsection (d) of
this Section.


 


(c)           Register.  The Administrative Agent, acting solely for
this purpose as an agent of the Borrower, shall maintain at the Administrative
Agent’s office 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 Advances and Letter of Credit
obligations owing to, each Lender pursuant to the terms hereof from time to
time (the “Register”).  The
entries in the Register shall be conclusive, and the Borrower, the
Administrative Agent and the Lenders may treat each Person whose name is
recorded in the Register pursuant to the terms hereof as a Lender hereunder for
all purposes of this Agreement, notwithstanding notice to the contrary.  The Register shall be available for
inspection by the Borrower and the Issuing Bank at any reasonable time and from
time to time upon reasonable prior notice. 
In addition, at any time that a request for a consent for a material or
substantive change to the Loan Documents is pending, any Lender may request and
receive from the Administrative Agent a copy of the Register.


 


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(d)           Participations.  Any Lender may at any time, without the
consent of, or notice to, the Borrower or the Administrative Agent, sell
participations to any Person (other than a natural person or the Borrower or
any of the Borrower’s Affiliates or Subsidiaries) (each, a “Participant”)
in all or a portion of such Lender’s rights and/or obligations under this
Agreement (including all or a portion of its Commitment and/or the Advances
(including such Lender’s participations in Letters of Credit and/or Swing Line
Advances) owing to it); provided that (i) such Lender’s obligations
under this Agreement shall remain unchanged, (ii) such Lender shall remain
solely responsible to the other parties hereto for the performance of such
obligations and (iii) the Borrower, the Administrative Agent and the other
Lender Parties shall continue to deal solely and directly with such Lender in
connection with such Lender’s rights and obligations under this Agreement.  Any agreement or instrument pursuant to which
a Lender sells such a participation shall provide that such Lender shall retain
the sole right to enforce this Agreement and to approve any amendment,
modification or waiver of any provision of this Agreement; provided that
such agreement or instrument may provide that such Lender will not, without the
consent of the Participant, agree to any amendment, waiver or other
modification described in clauses (i) through (vii) of the Section 11.1(a) that
affects such Participant.  Subject to subsection (e) of
this Section, the Borrower agrees that each Participant shall be entitled to
the benefits of Sections 2.10, 2.12 and 11.4(e) 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
Participant also shall be entitled to the benefits of Section 11.5 as though it were a Lender, provided such
Participant agrees to be subject to Section 2.13 as though it were
a Lender.


 


(e)           Limitation
on Participant Rights.  A Participant
shall not be entitled to receive any greater payment under Section 2.10
or 2.12 than the applicable Lender would
have been entitled to receive with respect to the participation sold to such
Participant, unless the sale of the participation to such Participant is made
with the Borrower’s prior written consent. 
A Participant that would be a Non-U.S. Lender if it were a Lender shall
not be entitled to the benefits of Section 2.12 unless the Borrower
is notified of the participation sold to such Participant and such Participant
agrees, for the benefit of the Borrower, to comply with Section 2.12(e) as
though it were a Lender.


 


(f)            Certain
Pledges.  Any Lender may at any time
pledge or assign a security interest in all or any portion of its rights under
this Agreement (including under its 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 release
such Lender from any of its obligations hereunder or substitute any such
pledgee or assignee for such Lender as a party hereto.


 


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


 


(h)           Resignation
as Issuing Bank or Swing Line Bank after Assignment.  Notwithstanding anything to the contrary
contained herein, if at any time Bank of America assigns all of its Commitment
and Advances pursuant to subsection (b) above, Bank of America may, (i) upon
thirty days’ notice to the Borrower and the Lenders, resign as Issuing Bank
and/or (ii) upon thirty days’ notice to the Borrower, resign as Swing Line
Bank.  In the event of any such
resignation as Issuing Bank or Swing Line Bank, the Borrower shall be entitled
to appoint from among the Lenders a successor Issuing Bank or Swing Line Bank
hereunder; provided, however, that no failure by the Borrower to
appoint any such successor shall affect the resignation of Bank of America as
Issuing Bank or Swing Line Bank, as the case may be.  If


 


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Bank of America resigns as
Issuing Bank, it shall retain all the rights, powers, privileges and duties of
the Issuing Bank hereunder with respect to all Letters of Credit outstanding as
of the effective date of its resignation as Issuing Bank and all obligations
owing to it with respect thereto (including the right to require the Lenders to
make Letter of Credit Advances in unreimbursed drawings pursuant to Section 2.3(c)).  If Bank of America resigns as Swing Line
Bank, it shall retain all the rights of the Swing Line Bank provided for
hereunder with respect to Swing Line Advances made by it and outstanding as of
the effective date of such resignation, including the right to require the
Lenders to make Prime Rate Loans or fund risk participations in outstanding
Swing Line Advances pursuant to Section 2.2(b).  Upon the appointment of a successor Issuing
Bank and/or Swing Line Bank, (1) such successor shall succeed to and
become vested with all of the rights, powers, privileges and duties of the
retiring Issuing Bank or Swing Line Bank, as the case may be, and (2) the
successor Issuing Bank shall issue letters of credit in substitution for the
Letters of Credit, if any, outstanding at the time of such succession or make
other arrangements satisfactory to Bank of America to effectively assume the
obligations of Bank of America with respect to such Letters of Credit.


 


Section 11.8         Execution
in Counterparts.


 


This
Agreement may be executed in any number of counterparts and by different
parties hereto in separate counterparts, each of which when so executed shall
be deemed to be an original and all of which taken together shall constitute
one and the same agreement.  Delivery of
an executed counterpart of a signature page to this Agreement by
telecopier shall be as effective as delivery of a manually executed counterpart
of this Agreement.


 


Section 11.9         No
Liability of the Issuing Bank.


 


The
Borrower assumes all risks of the acts or omissions of any beneficiary or
transferee of any Letter of Credit with respect to its use of such Letter of
Credit.  Neither the Issuing Bank nor any
of its officers, directors, employees or agents shall be liable or responsible
for: (a) the use that may be made of any Letter of Credit or any acts or
omissions of any beneficiary or transferee in connection therewith; (b) the
validity, sufficiency or genuineness of documents, or of any endorsement
thereon, even if such documents should prove to be in any or all respects
invalid, insufficient, fraudulent or forged; (c) payment by the Issuing
Bank against presentation of documents that do not comply with the terms of a
Letter of Credit, including failure of any documents to bear any reference or
adequate reference to the Letter of Credit; or (d) any other circumstances
whatsoever in making or failing to make payment under any Letter of Credit,
except that the Borrower shall have a claim against the Issuing Bank, and the
Issuing Bank shall be liable to the Borrower, to the extent of any direct, but
not consequential, damages suffered by the Borrower that the Borrowers prove
were caused by (i) the Issuing Bank’s willful misconduct or gross
negligence in determining whether documents presented under any Letter of
Credit comply with the terms of the Letter of Credit or (ii) the Issuing
Bank’s willful failure to make lawful payment under a Letter of Credit after
the presentation to it of a draft and certificates strictly complying with the
terms and conditions of the Letter of Credit. 
None of the Issuing Bank, the Administrative Agent, any of their
respective Related Parties nor any correspondent, participant or assignee of
the Issuing Bank shall be liable to any Lender for (i) any action taken or
omitted in connection with any Letter of Credit 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
Issuer Document.  In furtherance and not
in limitation of the foregoing, the Issuing Bank may accept documents that
appear on their face to be in order, without responsibility for further
investigation, regardless of any notice or information to the contrary.


 


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Section 11.10       Confidentiality.


 


Each
of the Administrative Agent and the Lender Parties agrees to maintain the
confidentiality of the Information (as defined below), except that Information
may be disclosed (a) to its Affiliates and to its and its Affiliates’
respective partners, directors, officers, employees, agents, advisors and
representatives (it being understood that the Persons to whom such disclosure
is made will be informed of the confidential nature of such Information and
instructed to keep such Information confidential), (b) to the extent
requested by any regulatory authority purporting to have jurisdiction over it
(including any self-regulatory authority, such as the National Association of
Insurance Commissioners), (c) to the extent required by applicable laws or
regulations or by any subpoena or similar legal process, (d) to any other
party hereto, (e) in connection with the exercise of any remedies
hereunder or under any other Loan Document or any action or proceeding relating
to this Agreement or any other Loan Document or the enforcement of rights
hereunder or thereunder, (f) subject to an agreement containing provisions
substantially the same as those of this Section 11.10, to (i) any
assignee of or Participant in, or any prospective assignee of or Participant
in, any of its rights or obligations under this Agreement or (ii) any
actual or prospective counterparty (or its advisors) to any swap or derivative
transaction relating to the Borrower and its obligations, (g) with the
consent of the Borrower or (h) to the extent such Information (x) becomes
publicly available other than as a result of a breach of this Section 11.10 or
(y) becomes available to the Administrative Agent, any Lender Party or any of
their respective Affiliates on a nonconfidential basis from a source other than
the Borrower.


 


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


 


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


 


Section 11.11       Further
Assurances.


 


(a)           At
any time and from time to time, upon the request of the Administrative Agent,
the Borrower and each other Loan Party shall execute, deliver and acknowledge
or cause to be executed, delivered or acknowledged, such further documents and
instruments and do such further acts as the Administrative Agent may reasonably
request in order to fully affect the purposes of this Agreement, the other Loan
Documents and any other agreements, instruments and documents delivered
pursuant hereto or in connection with the Facilities.


 


(b)           Upon
receipt of an affidavit of an officer of the Administrative Agent or any Lender
as to the loss, theft, destruction or mutilation of any Note or Collateral
Document which is not of public record and, in the case of any such mutilation,
upon the surrender and cancellation of such Note or Collateral Document, the
Borrower will issue, in lieu thereof, a replacement Note or Collateral Document
in the same principal amount thereof (in the case of any Note) and otherwise of
like tenor.


 


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Section 11.12       Jurisdiction,
Etc.


 


(a)           EACH
OF THE PARTIES HERETO HEREBY IRREVOCABLY AND UNCONDITIONALLY SUBMITS, FOR ITSELF AND ITS PROPERTY, TO THE NONEXCLUSIVE
JURISDICTION OF ANY NEW YORK STATE COURT OR FEDERAL
COURT OF THE UNITED STATES OF AMERICA SITTING IN NEW YORK CITY, AND
ANY APPELLATE COURT FROM ANY THEREOF, IN ANY ACTION OR PROCEEDING ARISING OUT
OF OR RELATING TO THIS AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS TO WHICH IT
IS A PARTY, OR FOR RECOGNITION OR ENFORCEMENT OF ANY JUDGMENT, AND EACH OF THE
PARTIES HERETO HEREBY IRREVOCABLY AND UNCONDITIONALLY AGREES THAT ALL CLAIMS IN
RESPECT OF ANY SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN
ANY SUCH NEW YORK STATE COURT OR, TO THE EXTENT PERMITTED BY LAW, IN SUCH
FEDERAL COURT.  EACH OF THE PARTIES
HERETO AGREES THAT A FINAL JUDGMENT IN ANY SUCH ACTION OR PROCEEDING SHALL BE
CONCLUSIVE AND MAY BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON THE
JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY LAW.  NOTHING IN THIS AGREEMENT SHALL AFFECT ANY
RIGHT THAT ANY LENDER PARTY MAY OTHERWISE HAVE TO BRING ANY ACTION OR
PROCEEDING RELATING TO THIS AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS IN THE
COURTS OF ANY JURISDICTION.


 


(b)           EACH
OF THE PARTIES HERETO IRREVOCABLY AND UNCONDITIONALLY WAIVES, TO THE FULLEST
EXTENT IT MAY LEGALLY AND EFFECTIVELY DO
SO, ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE
OF ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT
OR ANY OF THE OTHER LOAN DOCUMENTS TO WHICH IT IS A PARTY IN ANY NEW YORK
STATE OR FEDERAL COURT.  EACH OF THE
PARTIES HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY
LAW, THE DEFENSE OF AN INCONVENIENT FORUM TO THE MAINTENANCE OF SUCH ACTION OR
PROCEEDING IN ANY SUCH COURT.


 


Section 11.13       GOVERNING LAW.


 


THIS
AGREEMENT, THE NOTES AND THE OTHER LOAN DOCUMENTS (OTHER THAN THE MORTGAGES
WHICH SHALL BE GOVERNED BY THE LAW OF THE JURISDICTION WHERE THE PROPERTY
COVERED THEREBY IS LOCATED) SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED
IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO
ITS RULES PERTAINING TO CONFLICTS OF LAWS OTHER THAN GENERAL OBLIGATIONS LAW SECTION 5-1401.


 


Section 11.14       WAIVER OF
JURY TRIAL.


 


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


 


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THE OTHER PARTIES HERETO HAVE
BEEN INDUCED TO ENTER INTO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS BY,
AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.


 


Section 11.15       Survival of Representations and
Warranties.


 


All
representations and warranties made hereunder and in any other Loan 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 and each Lender Party,
regardless of any investigation made by the Administrative Agent or any Lender
Party or on their behalf and notwithstanding that the Administrative Agent or
any Lender Party may have had notice or knowledge of any Default at the time of
any extension of credit hereunder, and shall continue in full force and effect
as long as any Advance or any other Obligation hereunder shall remain unpaid or
unsatisfied or any Letter of Credit shall remain outstanding


 


Section 11.16       USA
PATRIOT Act Notice.


 


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


 


 


[SIGNATURE PAGES FOLLOW]


 


96





















 


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


 


	
   

  	
  CANTEL MEDICAL CORP.,

  
	
   

  	
  as Borrower

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
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  BANK
  OF AMERICA, N.A.,

  
	
   

  	
  as
  Administrative Agent,

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
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  BANK
  OF AMERICA, N.A.,

  
	
   

  	
  as
  Issuing Bank,

  
	
   

  	
  as
  Swing Line Bank and as a Lender

  
	
   

  	
   

  
	
   

  	
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  Title:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  WELLS
  FARGO BANK, NATIONAL ASSOCIATION,

  
	
   

  	
  as
  a Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
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  Title:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  PNC
  BANK, NATIONAL ASSOCIATION,

  
	
   

  	
  as
  a Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
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  Title: