Exhibit 10.28




 





 


CREDIT AGREEMENT



among



JACKSON HEWITT TAX SERVICE INC.,

JACKSON HEWITT INC.,

TAX SERVICES OF AMERICA, INC, and

HEWFANT INC.

as Borrowers,





THE LENDERS NAMED HEREIN,



WACHOVIA BANK, NATIONAL ASSOCIATION,

as Administrative Agent,



BANK OF AMERICA, N.A.



and



CITIBANK, F.S.B,

as co-Syndication Agents,



and



MANUFACTURERS AND TRADERS TRUST COMPANY



and

PNC BANK, NATIONAL ASSOCIATION

as co-Documentation Agents



$250,000,000 Senior Credit Facilities



WACHOVIA CAPITAL MARKETS, LLC

Sole Lead Arranger and Sole Book Runner



Dated as of June 29, 2005




 





 





















 


TABLE OF CONTENTS


 


	
  ARTICLE I

  

  DEFINITIONS

  
	
   

  	
   

  
	
  1.1

  	
  Defined
  Terms

  	
   

  
	
  1.2

  	
  Accounting
  Terms

  	
   

  
	
  1.3

  	
  Other Terms; Construction

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE II

  

  AMOUNT AND TERMS OF THE LOANS

  	
   

  
	
   

  	
   

  
	
  2.1

  	
  Commitments

  	
   

  
	
  2.2

  	
  Borrowings

  	
   

  
	
  2.3

  	
  Disbursements; Funding Reliance; Domicile of Loans

  	
   

  
	
  2.4

  	
  Evidence
  of Debt; Notes

  	
   

  
	
  2.5

  	
  Termination and Reduction of Revolving Credit Commitments and
  Swingline Commitment

  	
   

  
	
  2.6

  	
  Mandatory Payments and Prepayments

  	
   

  
	
  2.7

  	
  Voluntary Prepayments

  	
   

  
	
  2.8

  	
  Interest

  	
   

  
	
  2.9

  	
  Fees

  	
   

  
	
  2.10

  	
  Interest
  Periods

  	
   

  
	
  2.11

  	
  Conversions and Continuations

  	
   

  
	
  2.12

  	
  Method of Payments; Computations;
  Apportionment of Payments

  	
   

  
	
  2.13

  	
  Recovery of Payments

  	
   

  
	
  2.14

  	
  Use of Proceeds

  	
   

  
	
  2.15

  	
  Pro Rata Treatment

  	
   

  
	
  2.16

  	
  Increased Costs; Change in Circumstances; Illegality

  	
   

  
	
  2.17

  	
  Taxes

  	
   

  
	
  2.18

  	
  Compensation

  	
   

  
	
  2.19

  	
  Replacement of Lenders; Mitigation of Costs

  	
   

  
	
  2.20

  	
  Increases of Revolving Credit Commitments

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE III

  

  LETTERS OF CREDIT

  
	
   

  	
   

  	
   

  
	
  3.1

  	
  Issuance

  	
   

  
	
  3.2

  	
  Notices

  	
   

  
	
  3.3

  	
  Participations

  	
   

  
	
  3.4

  	
  Reimbursement

  	
   

  
	
  3.5

  	
  Payment by Revolving Loans

  	
   

  
	
  3.6

  	
  Payment to Revolving Credit Lenders

  	
   

  
				



 


i





















 


	
  3.7

  	
  Obligations Absolute

  	
   

  
	
  3.8

  	
  Cash Collateral Account

  	
   

  
	
  3.9

  	
  The Issuing Lender

  	
   

  
	
  3.10

  	
  Effectiveness

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE IV

  

  CONDITIONS OF BORROWING

  
	
   

  	
   

  	
   

  
	
  4.1

  	
  Conditions of Initial Borrowing

  	
   

  
	
  4.2

  	
  Conditions of All Borrowings

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE V

  

  REPRESENTATIONS AND WARRANTIES

  
	
   

  	
   

  
	
  5.1

  	
  Corporate Organization and Power

  	
   

  
	
  5.2

  	
  Authorization; Enforceability

  	
   

  
	
  5.3

  	
  No Violation

  	
   

  
	
  5.4

  	
  Governmental and Third-Party Authorization; Permits

  	
   

  
	
  5.5

  	
  Litigation

  	
   

  
	
  5.6

  	
  Taxes

  	
   

  
	
  5.7

  	
  Subsidiaries

  	
   

  
	
  5.8

  	
  Full Disclosure

  	
   

  
	
  5.9

  	
  Margin Regulations

  	
   

  
	
  5.10

  	
  No Material Adverse Effect

  	
   

  
	
  5.11

  	
  Financial Matters

  	
   

  
	
  5.12

  	
  Ownership of Properties

  	
   

  
	
  5.13

  	
  ERISA

  	
   

  
	
  5.14

  	
  Environmental Matters

  	
   

  
	
  5.15

  	
  Compliance with Laws

  	
   

  
	
  5.16

  	
  Intellectual Property

  	
   

  
	
  5.17

  	
  Regulated Industries

  	
   

  
	
  5.18

  	
  Insurance

  	
   

  
	
  5.19

  	
  Material Contracts

  	
   

  
	
  5.20

  	
  No Burdensome Restrictions

  	
   

  
	
  5.21

  	
  OFAC; Anti-Terrorism Laws

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE VI

  

  AFFIRMATIVE COVENANTS

  
	
   

  	
   

  	
   

  
	
  6.1

  	
  Financial
  Statements

  	
   

  
	
  6.2

  	
  Other
  Business and Financial Information

  	
   

  
	
  6.3

  	
  Existence;
  Franchises; Maintenance of Properties

  	
   

  
	
  6.4

  	
  Compliance
  with Laws

  	
   

  
	
  6.5

  	
  Payment
  of Obligations

  	
   

  
	
  6.6

  	
  Insurance

  	
   

  
				



 


ii





















 


	
  6.7

  	
  Maintenance
  of Books and Records; Inspection

  	
   

  
	
  6.8

  	
  Material
  Subsidiaries

  	
   

  
	
  6.9

  	
  Environmental
  Laws

  	
   

  
	
  6.10

  	
  OFAC.
  PATRIOT Act Compliance

  	
   

  
	
  6.11

  	
  Further
  Assurances

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE VII

  

  FINANCIAL COVENANTS

  
	
   

  	
   

  	
   

  
	
  7.1

  	
  Leverage
  Ratio

  	
   

  
	
  7.2

  	
  Interest
  Coverage Ratio

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE VIII

  

  NEGATIVE COVENANTS

  
	
   

  	
   

  	
   

  
	
  8.1

  	
  Fundamental
  Changes

  	
   

  
	
  8.2

  	
  Liens

  	
   

  
	
  8.3

  	
  Investments

  	
   

  
	
  8.4

  	
  Restricted
  Payments

  	
   

  
	
  8.5

  	
  Transactions
  with Affiliates

  	
   

  
	
  8.6

  	
  Transactions
  with Franchisees

  	
   

  
	
  8.7

  	
  Lines
  of Business

  	
   

  
	
  8.8

  	
  Sale-Leaseback
  Transactions

  	
   

  
	
  8.9

  	
  Certain
  Amendments

  	
   

  
	
  8.10

  	
  Restrictive
  Agreements

  	
   

  
	
  8.11

  	
  Fiscal
  Year

  	
   

  
	
  8.12

  	
  Accounting
  Changes

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE IX

  

  EVENTS OF DEFAULT

  
	
   

  	
   

  	
   

  
	
  9.1

  	
  Events
  of Default

  	
   

  
	
  9.2

  	
  Remedies:
  Termination of Commitments. Acceleration. etc.

  	
   

  
	
  9.3

  	
  Remedies:
  Set-Off

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE X

  

  THE ADMINISTRATIVE AGENT

  
	
   

  	
   

  	
   

  
	
  10.1

  	
  Appointment
  and Authority

  	
   

  
	
  10.2

  	
  Rights
  as a Lender

  	
   

  
	
  10.3

  	
  Exculpatory
  Provisions

  	
   

  
	
  10.4

  	
  Reliance
  by Administrative Agent

  	
   

  
	
  10.5

  	
  Delegation
  of Duties

  	
   

  
	
  10.6

  	
  Resignation
  of Administrative Agent

  	
   

  
				



 


iii





















 


	
  10.7

  	
  Non-Reliance
  on Administrative Agent and Other Lenders

  	
   

  
	
  10.8

  	
  No
  Other Duties. Etc.

  	
   

  
	
  10.9

  	
  Guaranty
  Matters

  	
   

  
	
  10.10

  	
  Issuing
  Lender and Swingline Lender

  	
   

  
	
   

  	
   

  
	
  ARTICLE XI

  

  MISCELLANEOUS

  
	
   

  	
   

  
	
  11.1

  	
  Expenses;
  Indemnity; Damage Waiver

  	
   

  
	
  11.2

  	
  Governing
  Law; Submission to Jurisdiction; Waiver of Venue; Service of Process

  	
   

  
	
  11.3

  	
  Waiver
  of Jury Trial

  	
   

  
	
  11.4

  	
  Notices;
  Effectiveness; Electronic Communication

  	
   

  
	
  11.5

  	
  Amendments,
  Waivers. etc.

  	
   

  
	
  11.6

  	
  Successors
  and Assigns

  	
   

  
	
  11.7

  	
  No
  Waiver

  	
   

  
	
  11.8

  	
  Survival

  	
   

  
	
  11.9

  	
  Severability

  	
   

  
	
  11.10

  	
  Construction.

  	
   

  
	
  11.11

  	
  Confidentiality

  	
   

  
	
  11.12

  	
  Joint
  and Several Liability

  	
   

  
	
  11.13

  	
  Appointment
  of Administrative Borrower

  	
   

  
	
  1
  1.14

  	
  Counterparts;
  Integration; Effectiveness

  	
   

  
	
  11.15

  	
  Disclosure
  of Information

  	
   

  
	
  11.16

  	
  USA
  Patriot Act Notice

  	
   

  



 


iv





















 


	
  EXHIBITS

  
	
   

  
	
  Exhibit A-1
  

  	
  Form of
  Revolving Note 

  
	
  Exhibit A-2
  

  	
  Form of
  Swingline Note 

  
	
  Exhibit B-1
  

  	
  Form of
  Notice of Borrowing 

  
	
  Exhibit B-2
  

  	
  Form of
  Notice of Swingline Borrowing 

  
	
  Exhibit B-3
  

  	
  Form of
  Notice of Conversion/Continuation 

  
	
  Exhibit B-4
  

  	
  Form of
  Letter of Credit Notice 

  
	
  Exhibit C
  

  	
  Form of
  Compliance Certificate 

  
	
  Exhibit D
  

  	
  Form of
  Assignment and Assumption 

  
	
  Exhibit E
  

  	
  Form of
  Guaranty 

  
	
  Exhibit F
  

  	
  Form of
  Financial Condition Certificate 

  
	
   

  	
   

  
	
  SCHEDULES

  
	
   

  
	
  Schedule 1.1
  

  	
  Commitments
  and Notice Addresses 

  
	
  Schedule 5.4
  

  	
  Consents
  and Approvals 

  
	
  Schedule 5.7
  

  	
  Subsidiaries
  

  
	
  Schedule 5.19
  

  	
  Material
  Contracts 

  
	
  Schedule 8.2
  

  	
  Liens
  

  
	
  Schedule 8.3
  

  	
  Investments
  

  
	
  Schedule 8.5
  

  	
  Transactions
  with Affiliates 

  
	
  Schedule 8.10
  

  	
  Restrictive
  Agreements 

  



 


v





















 


CREDIT AGREEMENT


 


THIS CREDIT AGREEMENT, dated as of the 29th day of June, 2005, is
made among JACKSON HEWITT TAX SERVICE INC., a Delaware corporation (the “Parent”),
JACKSON HEWITT INC., a Virginia corporation (“Jackson
Hewitt”), TAX SERVICES OF AMERICA, INC., a Delaware corporation (“Tax
Services”), and HEWFANT INC., a Virginia corporation (“Hewfant”
and collectively with the Parent, Jackson Hewitt and Tax Services, the “Borrowers”
and each a “Borrower”), the Lenders (as hereinafter defined), WACHOVIA BANK, NATIONAL ASSOCIATION, as Administrative Agent for the
Lenders, BANK OF AMERICA, N.A. and CITIBANK,
F.S.B., as co-Syndication Agents for the Lenders, and MANUFACTURERS AND TRADERS TRUST COMPANY and
PNC BANK, NATIONAL ASSOCIATION, as
co-Documentation Agents for the Lenders.


 


BACKGROUND STATEMENT


 


The
Borrowers have requested that the Lenders make available to the Borrowers a
revolving credit facility in the aggregate principal amount of $250,000,000. The
Borrowers will use the proceeds of this facility as provided in Section 2.14. The Lenders are willing to make available to the Borrowers the
credit facilities described herein subject to and on the terms and conditions
set forth in this Agreement.


 


AGREEMENT


 


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


 


ARTICLE I



DEFINITIONS


 


1.1                                 Defined Terms. For purposes of this Agreement, in addition
to the terms defined elsewhere herein, the following terms have the meanings
set forth below (such meanings to be equally applicable to the singular and
plural forms thereof):


 


“Account
Designation Letter” means a letter from the Borrowers to the Administrative
Agent, duly completed and signed by an Authorized
Officer of each of the Borrowers and in form and substance reasonably
satisfactory to the Administrative Agent, listing any one or more accounts to
which the Borrowers may from time to time request the Administrative Agent to
forward the proceeds of any Loans made hereunder.


 


“Acquisition”
means any transaction or series of related transactions, consummated on or
after the date hereof, by which the Borrowers directly, or indirectly through one
or more Subsidiaries, (i) acquire any going business, division thereof or
line of business, or all or substantially all of the assets, of any Person,
whether through purchase of assets, merger or otherwise, or (ii) acquire
securities or other ownership interests of any Person having at least a


 





















 


majority of combined voting power of the then
outstanding securities or other ownership interests of such Person.


 


“Adjusted
Base Rate” means, at any time with respect to any Base Rate Loan, a rate
per annum equal to the Base Rate as in effect at such time plus the Applicable
Percentage for Base Rate Loans as in effect at such time.


 


“Adjusted
LIBOR Rate” means, at any time with respect to any LIBOR Loan, a rate per
annum equal to the LIBOR Rate as in effect at such time plus the Applicable
Percentage for LIBOR Loans as in effect at such time.


 


“Administrative
Agent” means Wachovia, in its capacity as Administrative Agent appointed
under Section 10.1, and its successors and permitted
assigns in such capacity.


 


“Administrative
Borrower” shall have the meaning set forth in Section 11.13.


 


“Administrative
Questionnaire” means, with respect to each Lender, the administrative
questionnaire in the form submitted to such Lender by the Administrative Agent
and returned to the Administrative Agent duly completed by such Lender.


 


“Affiliate”
means, with respect to a specified Person, another Person that directly, or indirectly
through one or more intermediaries, Controls or is Controlled
by or is under common Control with the Person specified. Notwithstanding the
foregoing, neither the Administrative Agent nor any Lender shall be deemed an “Affiliate”
of any Credit Party. For purposes hereof, an Affiliate does not include any
Franchisee acting in such capacity.


 


“Aggregate
Revolving Credit Exposure” means, at any time, the sum of (i) the
aggregate principal amount of Revolving Loans outstanding at such time, (ii) the
aggregate Letter of Credit Exposure of all Revolving Credit Lenders at such
time and (iii) the aggregate principal amount of Swingline Loans
outstanding at such time.


 


“Agreement”
means this Credit Agreement, as amended, modified, restated or supplemented
from time to time in accordance with its terms.


 


“Applicable
Percentage” means, at any time from and after the Closing Date, the applicable
percentage (i) to be added to the Base Rate for purposes of determining
the Adjusted Base Rate, (ii) to be added to the LIBOR Rate for purposes of
determining the Adjusted LIBOR Rate and (iii) to be used in calculating
the commitment fee payable pursuant to Section 2.9(b), in each case as determined under the
following matrix with reference to the Leverage Ratio:


 


	
  Level

  	
   

  	
  Total

  Leverage Ratio

  	
   

  	
  Applicable

  LIBOR Margin

  	
   

  	
  Applicable Base

  Rate Margin

  	
   

  	
  Applicable

  Commitment Fee

  Percentage

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  I

  	
   

  	
  Greater than 2.0 to 1.0

  	
   

  	
  1.05

  	
  %

  	
  0.00

  	
  %

  	
  0.200

  	
  %

  
	
  II

  	
   

  	
  Less than or equal to 2.0 to 1.0 but
  greater than 1.0 to 1.0

  	
   

  	
  0.95

  	
  %

  	
  0.00

  	
  %

  	
  0.175

  	
  %

  
	
  III

  	
   

  	
  Less
  than or equal to 1.0 to 1.0

  	
   

  	
  0.85

  	
  %

  	
  0.00

  	
  %

  	
  0.150

  	
  %

  



 


2





















 


On
each Adjustment Date (as hereinafter defined), the Applicable Percentage for
all Loans and the commitment fee payable pursuant to Section 2.9(b) shall
be adjusted effective as of such Adjustment Date (based upon the calculation of
the Leverage Ratio as of the last day of the Reference Period to which such
Adjustment Date relates) in accordance with the above matrix; provided, however,
that, notwithstanding the foregoing or anything else herein to the contrary, if
at any time the Borrowers shall have failed to deliver any of the financial
statements as required by Sections 6.l(a) or
6.l(b), as the case may be, or the
Compliance Certificate as required by Section 6.2(a),
then at all times from and including the date on which such statements and
Compliance Certificate are required to have been delivered until the date on
which the same shall have been delivered, each Applicable Percentage shall be
determined based on Level I above (notwithstanding the actual Leverage Ratio).
For purposes of this definition, “Adjustment Date” means, with respect
to any Reference Period of the Borrowers beginning with the fiscal quarter
ending July 31, 2005, the
day (or, if such day is not a Business Day, the next succeeding Business Day)
ten days following the day of delivery by the Borrower in accordance with Section 6.l(a) or Section 6.l(b),
as the case may be, of (i) financial statements as of the end of and for
such Reference Period and (ii) a duly completed Compliance Certificate
with respect to such Reference Period. From the Closing Date until the
Adjustment Date for the fiscal quarter ending July 31, 2005, each Applicable Percentage shall be based on Level II
above.


 


“Approved
Fund” means any Fund that is administered or managed by (i) a Lender, (ii) an
Affiliate of a Lender, or (iii) a Person (or an Affiliate of a Person)
that administers or manages a Lender.


 


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


 


“Assignment
and Assumption” means an Assignment and Assumption entered into by a Lender
and an Eligible Assignee (with the consent of any party whose consent is
required by Section 11.6(b)), and
accepted by the Administrative Agent, in substantially the form of Exhibit D or any other form approved by the
Administrative Agent.


 


“Authorized
Officer” means, with respect to any action specified herein to be taken by
or on behalf of a Credit Party, any officer of such Credit Party duly authorized
by resolution of its board of directors or other governing body to take such
action on its behalf, and whose signature and incumbency shall have been
certified to the Administrative Agent by the secretary or an assistant
secretary of such Credit Party.


 


“Bankruptcy
Code” means 11 U.S.C. §§ 101 et
seq., as amended from time to time, and any successor
statute.


 


“Bankruptcy
Event” means the occurrence of an Event of Default pursuant to Section 9.1(f) or Section 9.1(g).


 


“Base
Rate” means the higher of (i) the per annum interest rate publicly
announced from time to time by Wachovia in Charlotte, North Carolina, to be its
prime rate (which may not necessarily be its lowest or best lending rate), as
adjusted to conform to changes as of the


 


3





















 


opening of business on the date of any such change
in such prime rate, and (ii) the Federal Funds Rate plus 0.5% per annum,
as adjusted to conform to changes as of the opening of business on the date of
any such change in the Federal Funds Rate.


 


“Base
Rate Loan” means, at any time, any Loan that bears interest at such time at
the applicable Adjusted Base Rate.


 


“Borrower”
and “Borrowers” have the meaning given to such terms in the introductory
paragraph hereof.


 


“Borrowing”
means the incurrence by the Borrowers (including as a result of conversions and
continuations of outstanding Loans pursuant to Section 2.11)
on a single date of a group of Loans of a single Type (or a Swingline Loan made
by the Swingline Lender) and, in the case of LIBOR Loans, as to which a single
Interest Period is in effect.


 


“Borrowing
Date” means, with respect to any Borrowing, the date upon which such
Borrowing is made.


 


“Bridge
Credit Facility” has the meaning giving to such term in Section 4.1(f).


 


“Business
Day” means (i) any day other than a Saturday or Sunday, a legal
holiday or a day on which commercial banks in Charlotte, North Carolina or New
York, New York are authorized or required by law to be closed and (ii) in
respect of any determination relevant to a LIBOR Loan, any such day that is
also a day on which trading in Dollar deposits is conducted by banks in London,
England in the London interbank Eurodollar market.


 


“Capital
Lease” means, with respect to any Person, any lease of property (whether
real, personal or mixed) by such Person as lessee that is or is required to be,
in accordance with GAAP, recorded as a capital lease on such Person’s balance
sheet.


 


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


 


“Capital
Stock” means (i) with respect to any Person that is a corporation, any
and all shares, interests or equivalents in capital stock (whether voting or
nonvoting, and whether common or preferred) of such corporation, and (ii) with
respect to any Person that is not a corporation, any and all partnership,
membership, limited liability company or other equity interests of such Person;
and in each case, any and all warrants, rights or options to purchase any of
the foregoing.


 


“Cash
Collateral Account” has the meaning given to such term in Section 3.8.


 


“Cash
Equivalents” means (i) securities issued or unconditionally guaranteed
or insured by the United States of America or any agency or instrumentality
thereof, backed by the full faith


 


4





















 


and credit of the United
States of America and maturing within one year from the date of acquisition, (ii) commercial
paper issued by any Person organized under the laws of the United States of
America, maturing within 270 days from the date of acquisition and, at the time
of acquisition, having a rating of at least A-1 or the equivalent thereof by
Standard & Poor’s Ratings Services or at least P-1 or the equivalent
thereof by Moody’s Investors Service, Inc., (iii) time deposits and
certificates of deposit maturing within 180 days from the date of issuance and
issued by a bank or trust company organized under the laws of the United States
of America or any state thereof (y) that, at the time of acquisition, has
combined capital and surplus of at least $500,000,000 or (z) that, at the time
of acquisition, has (or is a subsidiary of a bank holding company that has) a
long-term unsecured debt rating of at least A or the equivalent thereof by
Standard & Poor’s Ratings Services or at least A2 or the equivalent
thereof by Moody’s Investors Service, Inc., (iv) repurchase
obligations with a term not exceeding thirty (30) days with respect to
underlying securities of the types described in clause (i) above entered
into with any bank or trust company meeting the qualifications specified in
clause (iii) above at the time of acquisition, and (v) money market
funds that comply with the criteria set forth in Securities and Exchange Commission
Rule 2a-7 under the Investment Company Act of 1940, as amended.


 


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


 


“Closing
Date” means the date upon which the initial extensions of credit are made
pursuant to this Agreement, which shall be the date upon which each of the
conditions set forth in Section 4.1 and 4.2 shall
have been satisfied or waived in accordance with the terms of this Agreement.


 


“Code”
means the Internal Revenue Code of 1986, as amended from time to time, and any
successor statute, and all rules and regulations from time to time
promulgated thereunder.


 


“Compliance
Certificate” means a fully completed and duly executed certificate in the
form of Exhibit C, together with a Covenant Compliance
Worksheet.


 


“Consolidated
EBITDA” means, for any Reference Period, the aggregate of (i) Consolidated
Net Income for such period, after eliminating extraordinary gains and losses
and unusual items, plus (ii) the sum of (A) Consolidated
Interest Expense, (B) taxes, (C) depreciation and amortization, (D) other
non-cash charges and (E) any amount attributable to any nonrecurring item,
but excluding any cash payments made in such period with respect to any
non-recurring item, in each case to the extent deducted in the computation of
Consolidated Net Income for such period, plus (iii) without
duplication, EBITDA attributable to assets which are the subject of a Permitted
Acquisition consummated during such Reference Period for which the total
consideration (cash and stock) paid by the Parent and its Subsidiaries exceeds
$2,000,000 (provided (x) that the Administrative Agent has received
financial statements or other financial data relating to the calculation of
such EBITDA reasonably acceptable to the Administrative Agent and (y) that the
aggregate amount included in Consolidated EBITDA for any Reference


 


5





















 


Period pursuant to this
clause (iii) shall not exceed 10% of Consolidated EBITDA calculated
without giving effect to this clause (iii)).


 


“Consolidated
Funded Debt” means, as of any date of determination, the aggregate (without
duplication) of all Funded Debt of the Parent and its Subsidiaries as of such
date, determined on a consolidated basis in accordance with GAAP.


 


“Consolidated
Interest Expense” means, for any Reference Period, the total interest
expense of the Parent and its Subsidiaries for such Reference Period in respect
of Consolidated Funded Debt (including, without limitation, all such interest
expense accrued or capitalized during such Reference Period, whether or not
actually paid during such Reference Period), determined on a consolidated basis
in accordance with GAAP.


 


“Consolidated
Net Income” means, for any Reference Period, net income (or loss) for the
Parent and its Subsidiaries for such Reference Period, determined on a
consolidated basis in accordance with GAAP (after deduction for minority
interests); provided that, in making such determination, there shall be
excluded (i) the net income of any other Person that is not a Subsidiary
of the Parent (or is accounted for by the Parent by the equity method of
accounting) except to the extent of actual payment of cash dividends or
distributions by such Person to the Parent or any Subsidiary of the Parent
during such period, and (ii) the net income of any Subsidiary of the
Parent to the extent that the declaration or payment of dividends or similar
distributions by such Subsidiary of such net income is not at the time
permitted by operation of the terms of its charter, certificate of
incorporation or formation or other constituent document or any agreement or
instrument (other than a Credit Document) or Requirement of Law applicable to
such Subsidiary.


 


“Consolidated
Net Tangible Assets” means, as of any date of determination, Consolidated
Total Assets less goodwill and other intangibles as shown on the consolidated
balance sheet of the Parent and its Subsidiaries for the most recently ended
fiscal quarter.


 


“Consolidated
Total Assets” means, as of any date of determination, all assets of the
Parent and its Subsidiaries determined on a consolidated basis in accordance
with GAAP.


 


“Control”
means, with respect to any Person, (i) the possession, direct or indirect,
of the power to direct or cause the direction of the management and policies of
such Person, whether through the ownership of voting securities, by contract or
otherwise, or (ii) the beneficial ownership of securities or other
ownership interests of such Person having 10% or more of the combined voting
power of the then outstanding securities or other ownership interests of such
Person ordinarily (and apart from rights accruing under special circumstances)
having the right to vote in the election of directors or other governing body
of such Person; and the terms “Controlled” and “Controlling” have correlative
meanings.


 


“Covenant
Compliance Worksheet” means a fully completed worksheet in the form of Attachment A to Exhibit C.


 


“Credit
Documents” means this Agreement, the Notes, the Letters of Credit, the Fee
Letter, the Guaranty, and all other agreements, instruments, documents and
certificates now or hereafter executed and delivered to the Administrative
Agent or any Lender by or on behalf of


 


6





















 


the Borrowers or any other Credit Party with
respect to this Agreement, in each case as amended, modified, supplemented or
restated from time to time; but specifically excluding any Hedge Agreement to
which any Borrower and any Hedge Party are parties.


 


“Credit Parties” means the the Borrowers and the Guarantors, and
their respective successors.


 


“Default”
means any event or condition that, with the passage of time or giving of
notice, or both, would constitute an Event of Default.


 


“Defaulting
Lender” means any Lender that (i) has refused to fund, or otherwise
defaulted in the funding of, its ratable share of any Borrowing requested and
permitted to be made hereunder, including the funding of a participation
interest in Letters of Credit or Swingline Loans in accordance with the terms
hereof, (ii) has failed to pay to the Administrative Agent or any Lender
when due an amount owed by such Lender pursuant to the terms of this Credit
Agreement, unless such amount is subject to a good faith dispute, or (iii) has
been deemed insolvent or has become subject to a bankruptcy or insolvency
proceeding or to a receiver, trustee or similar official, and such refusal has
not been withdrawn or such default has not been cured within three (3) Business Days.


 


“Disqualified
Capital Stock” means, with respect to any Person, any Capital Stock of such
Person that, by its terms (or by the terms of any security into which it is
convertible or for which it is exchangeable), or upon the happening of any
event or otherwise, (i) matures or is mandatorily redeemable or subject to
any mandatory repurchase requirement, pursuant to a sinking fund obligation or
otherwise, (ii) is redeemable subject to any mandatory repurchase
requirement at the sole option of the holder thereof, or (iii) is
convertible into or exchangeable for (whether at the option of the issuer or
the holder thereof) (y) debt securities or (z) any Capital Stock referred to in
(i) or (ii) above, in each case under (i), (ii) or (iii) above
at any time on or prior to the first anniversary of the Maturity Date; provided,
however, that only the portion of Capital Stock that so matures or is
mandatorily redeemable, is so redeemable at the option of the holder thereof,
or is so convertible or exchangeable on or prior to such date shall be deemed
to be Disqualified Capital Stock.


 


“Dollars”
or “$” means dollars of the United States of America.


 


“Eligible
Assignee” means (i) a Lender, (ii) an Affiliate of a Lender, (iii) an
Approved Fund, and (iv) any other Person (other than a natural person)
approved by (x) the Administrative Agent, (y) in the case of any assignment of
a Revolving Credit Commitment or portion thereof, the Issuing Lender and the
Swingline Lender, and (z) unless a Default or Event of Default has occurred and
is continuing, the Borrowers (each such approval not to be unreasonably
withheld or delayed); provided that notwithstanding the foregoing, “Eligible
Assignee” shall not include the Borrowers or any of the Borrowers’ Affiliates
or Subsidiaries.


 


“Environmental
Claims” means any and all administrative, regulatory or judicial actions,
suits, demands, demand letters, claims, liens, allegations, notices of
noncompliance or violation, investigations by a Governmental Authority, or
proceedings (including, without limitation, administrative, regulatory and
judicial proceedings) relating in any way to any Hazardous


 


7





















 


Substance, any actual or
alleged violation of or liability under any Environmental Law or any permit
issued, or any approval given, under any Environmental Law (collectively, “Claims”),
including, without limitation, (i) any and all Claims by Governmental Authorities
for enforcement, cleanup, removal, response, remedial or other actions or
damages pursuant to any applicable Environmental Law and (ii) any and all
Claims by any third party seeking damages, contribution, indemnification, cost
recovery, compensation or injunctive relief resulting from any Hazardous
Substance or arising from alleged injury or threat of injury to human health or
the environment.


 


“Environmental
Laws” means any and all federal, state and local laws, statutes,
ordinances, rules, regulations, permits, licenses, approvals, rules of
common law and orders of courts or Governmental Authorities, relating to the
protection of human health, occupational safety with respect to exposure to
Hazardous Substances, or the environment, now or hereafter in effect, and in
each case as amended from time to time, including, without limitation,
requirements pertaining to the manufacture, processing, distribution, use,
treatment, storage, disposal, transportation, handling, reporting, licensing,
permitting, investigation or remediation of Hazardous Substances.


 


“ERISA”
means the Employee Retirement Income Security Act of 1974, as amended from time
to time, and any successor statute, and all rules and regulations from
time to time promulgated thereunder.


 


“ERISA
Affiliate” means any Person (including any trade or business, whether or
not incorporated) deemed to be under “common control” with, or a member of the
same “controlled group” as, the Borrowers or any of their Subsidiaries, with
the meaning of Sections 414(b), (c), (m) or (o) of the Code or Section 4001
of ERISA.


 


“ERISA
Event” means any of the following with respect to a Plan or Multiemployer
Plan, as applicable: (i) a Reportable Event, (ii) a complete or
partial withdrawal by the Borrowers or any ERISA Affiliate from a Multiemployer
Plan that results in liability under Section 4201 or 4204 of ERISA, or the
receipt by the Borrowers or any ERISA Affiliate of notice from a Multiemployer
Plan that it is in reorganization or insolvency pursuant to Section 4241
or 4245 of ERISA or that it intends to terminate or has terminated under Section 4041A
of ERISA, (iii) the distribution by the Borrowers or any ERISA Affiliate
under Section 4041 or 4041A of ERISA of a notice of intent to terminate
any Plan or the taking of any action to terminate any Plan, (iv) the
commencement of proceedings by the PBGC under Section 4042 of ERISA for
the termination of, or the appointment of a trustee to administer, any Plan, or
the receipt by the Borrowers or any ERISA Affiliate of a notice from any
Multiemployer Plan that such action has been taken by the PBGC with respect to
such Multiemployer Plan, (v) the institution of a proceeding by any
fiduciary of any Multiemployer Plan against the Borrowers or any ERISA
Affiliate to enforce Section 515 of ERISA, which is not dismissed within
thirty (30) days, (vi) the imposition upon the Borrowers or any ERISA
Affiliate of any liability under Title IV
of ERISA, other than for PBGC premiums due but not delinquent under Section 4007
of ERISA, or the imposition or threatened imposition of any Lien upon any
assets of the Borrowers or any ERISA Affiliate as a result of any alleged
failure to comply with the Code or ERISA in respect of any Plan, (vii) the
engaging in or otherwise becoming liable for a nonexempt Prohibited Transaction
by the Borrowers or any ERISA Affiliate, or a violation of the applicable


 


8





















 


requirements of Section 404
or 405 of ERISA or the exclusive benefit rule under Section 401(a) of
the Code by any fiduciary of any Plan for which the Borrowers or any of their
ERISA Affiliates may be directly or indirectly liable, (viii) the
occurrence with respect to any Plan of any “accumulated funding deficiency”
(within the meaning of Section 302 of ERISA and Section 412 of the
Code), whether or not waived, or (ix) the adoption of an amendment to any
Plan that, pursuant to Section 401(a)(29) of the Code or Section 307
of ERISA, would result in the loss of tax-exempt status of the trust of which such
Plan is a part if the Borrowers or an ERISA Affiliate fails to timely provide
security to such Plan in accordance with the provisions of such sections.


 


“Event
of Default” has the meaning given to such term in Section 9.1.


 


“Exchange
Act” means the Securities Exchange Act of 1934, as amended from time to
time, and any successor statute, and all rules and regulations from time
to time promulgated thereunder.


 


“Excluded
Taxes” means, with respect to the Administrative Agent, any Lender, the
Issuing Lender or any other recipient of any payment to be made by or on
account of any obligation of the Borrowers hereunder, (i) taxes imposed on
or measured by its overall net income (however denominated), and franchise
taxes imposed on it (in lieu of net income taxes), by the jurisdiction (or any
political subdivision thereof) under the laws of which such recipient is
organized or in which its principal office is located or, in the case of any
Lender, in which its applicable Lending Office is located, (ii) any branch
profits taxes imposed by the United States or any similar tax imposed by any
other jurisdiction in which the Borrowers are located and (iii) in the
case of a Foreign Lender (other than an assignee pursuant to a request by the
Borrowers under Section 2.19(a)), any
withholding tax that is imposed on amounts payable to such Foreign Lender at
the time such Foreign Lender becomes a party hereto (or designates a new
Lending Office) or is attributable to such Foreign Lender’s failure or
inability (other than as a result of a Change in Law) to comply with Section 2.17(e), except to the extent that such Foreign
Lender (or its assignor, if any) was entitled, at the time of designation of a
new Lending Office (or assignment), to receive additional amounts from the Borrowers
with respect to such withholding tax pursuant to Section 2.17(a).


 


“Existing
Letter of Credit” means the letter of credit outstanding on the date hereof
and issued by Wachovia Bank, National Association for the benefit of Dun &
Bradstreet, Inc. in the outstanding amount of One Million Dollars
($1,000,000).


 


“Existing
Senior Credit Facilities” has the meaning given to such term in Section 4.1(f).


 


“Federal
Funds Rate” means, for any period, a fluctuating per annum interest rate (rounded
upwards, if necessary, to the nearest 1/100 of one percentage point) equal for
each day during such period to the weighted average of the rates on overnight
federal funds transactions with members of the Federal Reserve System arranged
by federal funds brokers, as published for such day (or, if such day is not a
Business Day, for the next preceding Business Day) by the Federal Reserve Bank
of New York, or if such rate is not so published for any day that is a Business
Day, the average of the quotations for such day on such transactions received
by the Administrative Agent from three federal funds brokers of recognized
standing selected by the Administrative Agent.


 


9





















 


“Federal
Reserve Board” means the Board of Governors of the Federal Reserve System or
any successor thereto.


 


“Fee
Letter” means the letter from the Administrative Agent and the Arranger to
the Parent, dated May 11, 2005, relating to certain fees payable by the
Parent in respect of the transactions contemplated by this Agreement, as
amended, modified, restated or supplemented from time to time.


 


“Financial
Condition Certificate” means a fully
completed and duly executed certificate, in substantially the form of Exhibit H,
together with the attachments thereto.


 


“Financial
Officer” means, with respect to any Borrower, the chief financial officer,
vice president - finance, principal accounting officer, treasurer or controller
of such Borrower.


 


“fiscal quarter” or “FQ” means a fiscal quarter of the Parent and its Subsidiaries.


 


“fiscal year” or “FY” means a fiscal
year of the Parent and its Subsidiaries.


 


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


 


“Foreign
Subsidiary” means a Subsidiary of a Borrower that is a “controlled foreign corporation,”
as such term is defined in Section 957 of the Code.


 


“Franchisee”
means a Person (other than the Borrowers or a Subsidiary of the Borrowers) that
owns and operates a Borrower-licensed Office.


 


“Franchisee
Advance Payments” means advances or obligations to make advances made from
time to time by any Credit Party to third parties on behalf of or for the
benefit of a Franchisee and for which such Credit Party has a right to
reimbursement within 180 days following payment of such advance.


 


“Franchisee
Expansion” means the issuance of financing, including, development advance
notes or other similar financings to Franchisees by the Borrowers or
Subsidiaries of the Borrowers in the ordinary course of business.


 


“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 any Person, without duplication, all
Indebtedness of such Person (other than Indebtedness of the types referred to
in clauses (ix) and (x) of the definition of “Indebtedness”) and
all Guaranty Obligations with respect to Funded Debt of other Persons.


 


10





















 


“GAAP”
means generally accepted accounting principles in the United States of America,
as set forth in the statements, opinions and pronouncements of the Accounting
Principles Board, the American Institute of Certified Public Accountants and
the Financial Accounting Standards Board, consistently applied and maintained,
as in effect from time to time (subject to the provisions of Section 1.2).


 


“Governmental
Authority” means the government of the United States of America or any
other nation, or of any political subdivision thereof, whether state or local,
and any agency, authority, instrumentality, regulatory body, court, central
bank or other entity exercising executive, legislative, judicial, taxing,
regulatory or administrative powers or functions of or pertaining to government
(including any supra-national bodies such as the European Union or the European
Central Bank).


 


“Guarantor”
means any Subsidiary of a Borrower that is a guarantor of the Obligations under
the Guaranty (or under another guaranty agreement in form and substance
satisfactory to the Administrative Agent).


 


“Guaranty”
means a guaranty agreement made by the Guarantors in favor of the
Administrative Agent and the Lenders, in substantially the form of Exhibit G, as
amended, modified, restated or supplemented from time to time.


 


“Guaranty
Obligation” means, with respect to any Person, any direct or indirect liability
of such Person with respect to any Indebtedness, liability or other obligation
(the “primary obligation”) of another Person (the “primary obligor”),
whether or not contingent, (i) to purchase, repurchase or otherwise
acquire such primary obligation or any property constituting direct or indirect
security therefor, (ii) to advance or provide funds (x) for the payment or
discharge of any such primary obligation or (y) to maintain working capital or
equity capital of the primary obligor or otherwise to maintain the net worth or
solvency or any balance sheet item, level of income or financial condition of
the primary obligor (including, without limitation, keep well agreements,
maintenance agreements, comfort letters or similar agreements or arrangements),
(iii) to lease or 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 in respect thereof to make payment of such primary
obligation or (iv) otherwise to assure or hold harmless the owner of any
such primary obligation against loss or failure or inability to perform in
respect thereof; provided, however, that, with respect to the
Borrowers and their Subsidiaries, the term Guaranty Obligation shall not
include endorsements for collection or deposit in the ordinary course of
business. The amount of any Guaranty Obligation of any guaranteeing Person
hereunder shall be deemed to be the lower of (a) an amount equal to the
stated or determinable amount of the primary obligation in respect of which
such Guaranty Obligation is made and (b) the maximum amount for which such
guaranteeing Person may be liable pursuant to the terms of the instrument
embodying such Guaranty Obligation, unless such primary obligation and the
maximum amount for which such guaranteeing Person may be liable are not stated or
determinable, in which case the amount of such Guaranty Obligation shall be
such guaranteeing Person’s maximum reasonably anticipated liability in respect
thereof as determined by such guaranteeing Person in good faith.


 


11





















 


“Hazardous Substance” means any substance or
material meeting any one or more of the following criteria: (i) it is or
contains a substance designated as a hazardous waste, hazardous substance,
hazardous material, pollutant, contaminant or toxic substance under any
Environmental Law, (ii) it is toxic, explosive, corrosive, ignitable,
infectious, radioactive,  mutagenic or
otherwise hazardous to human health or the environment and is or becomes
regulated by any Governmental Authority, (iii) its presence may require investigation
or response under any Environmental Law, (iv) it constitutes a nuisance,
trespass or health or safety hazard to Persons or neighboring properties, or (v) it
is or contains, without limiting the foregoing, asbestos, polychlorinated
biphenyls, urea formaldehyde foam insulation, petroleum hydrocarbons, petroleum
derived substances or wastes, crude oil, nuclear fuel, natural gas or synthetic
gas.


 


“Hedge Agreement” means any interest or foreign
currency rate swap, cap, collar, option, hedge, forward rate or other similar
agreement or arrangement designed to protect against fluctuations in interest
rates or currency exchange rates.


 


“Hedge Party” means any Lender or any Affiliate
of any Lender in its capacity as a counterparty to any Hedge Agreement with a
Borrower or any Subsidiary, which Hedge Agreement is required or permitted
under this Agreement to be entered into by the Borrower, or any former Lender
or any Affiliate of any former Lender in its capacity as a counterparty to any
such Hedge Agreement entered into prior to the date such Person or its
Affiliate ceased to be a Lender.


 


“Increasing Lender” has the meaning set forth
in Section 2.20.


 


“Indebtedness”
means, with respect to any Person (without duplication), (i) all
obligations of such Person for borrowed money, (ii) all obligations of
such Person evidenced by notes, bonds, debentures or similar instruments, or
upon which interest payments are customarily made, (iii) the maximum
stated or face amount of all surety bonds, letters of credit and bankers’
acceptances issued or created for the account of such Person and, without
duplication, all drafts drawn thereunder (to the extent unreimbursed), (iv) all
obligations of such Person to pay the deferred purchase price of property or
services (excluding trade payables incurred in the ordinary course of business
and not more than 90 days past due or disputed in good faith), (v) all
indebtedness created or arising under any conditional sale or other title
retention agreement with respect to property acquired by such Person, (vi) all
Capital Lease Obligations of such Person, (vii) all Disqualified Capital
Stock issued by such Person, with the amount of Indebtedness represented by
such Disqualified Capital Stock being equal to the greater of its voluntary or
involuntary liquidation preference and its maximum fixed repurchase price, (viii) the
principal balance outstanding and owing by such Person under any synthetic
lease, tax retention operating lease or similar off-balance sheet financing
product (but excluding other operating leases), (ix) all Guaranty
Obligations of such Person with respect to Indebtedness of another Person, (x)
the net termination obligations of such Person under any Hedge Agreements,
calculated as of any date as if such agreement or arrangement were terminated
as of such date, and (xi) all indebtedness of the types referred to in clauses (i) through
(x) above (A) of any partnership or unincorporated joint venture in which
such Person is a general partner or joint venturer to the extent such Person is
liable therefor or (B) secured by any Lien on any property or asset owned
or held by such Person regardless of whether or not the indebtedness secured
thereby shall have


 


12





















 


been incurred or assumed by such Person or is
nonrecourse to the credit of such Person, the amount thereof being equal to the
value of the property or assets subject to such Lien.


 


“Indemnified
Taxes” means Taxes arising from any payment made hereunder or under any
other Credit Document or from the execution, delivery or enforcement of, or
otherwise with respect to, this Agreement or any other Credit Document other
than Excluded Taxes.


 


“Intellectual
Property” means (i) all inventions (whether or not patentable and
whether or not reduced to practice), all improvements thereto, and all patents,
patent applications, and patent disclosures, together with all reissues,
continuations, continuations-in-part, divisions, revisions, extensions, and
reexaminations thereof, (ii) all trademarks, service marks, trade dress,
logos, trade names, and corporate names, together with all goodwill associated
therewith, and all applications, registrations, and renewals in connection
therewith, (iii) all copyrightable works and all copyrights (registered
and unregistered), (iv) all trade secrets and confidential information
(including, without limitation, financial, business and marketing plans and
customer and supplier lists and related information), (v) all computer
software and software systems (including, without limitation, data, databases
and related documentation), (vi) all Internet web sites and domain names, (vii) all
technology, know-how, processes and other proprietary rights, and (viii) all
licenses or other agreements to or from third parties regarding any of the
foregoing.


 


“Interest
Coverage Ratio” means, as of the last day of any Reference Period ending on
the last day of a fiscal quarter, the ratio of (i) Consolidated EBITDA for
such Reference Period to (ii) Consolidated Interest Expense for such
Reference Period to the extent paid (or required to he paid) in cash.


 


“Interest
Period” has the meaning given to such term in Section 2.10.


 


“Investments”
has the meaning given to such term in Section 8.3.


 


“Issuing
Lender” means Wachovia in its capacity as issuer of the Letters of Credit,
and its successors in such capacity.


 


“Lender”
means each Person signatory hereto as a “Lender” and each other Person that
becomes a “Lender” hereunder pursuant to Section 11.6, and their respective successors and
assigns.


 


“Lending
Office” means, with respect to any Lender, the office of such Lender
designated as such in such Lender’s Administrative Questionnaire or in
connection with an Assignment and Assumption, or such other office as may be
otherwise designated in writing from time to time by such Lender to the
Borrowers and the Administrative Agent. A Lender may designate separate Lending
Offices as provided in the foregoing sentence for the purposes of making or
maintaining different Types of Loans, and, with respect to LIBOR Loans, such
office may be a domestic or foreign branch or Affiliate of such Lender.


 


“Letter of Credit Exposure” means, with respect
to any Revolving Credit Lender at any time, such Lender’s ratable share (based
on the proportion that its Revolving Credit Commitment bears to the aggregate
Revolving Credit Commitments at such time) of the sum of (i) the


 


13





















 


aggregate Stated
Amount of all Letters of Credit outstanding at such time and (ii) the
aggregate amount of all Reimbursement Obligations outstanding at such time.


 


“Letter of Credit Maturity Date” means the
fifth (5th) Business Day prior to the Revolving Credit Maturity
Date.


 


“Letter of Credit Notice” has the meaning given
to such term in Section 3.2.


 


“Letter of Credit Subcommitment” means
$25,000,000 or, if less, the aggregate Revolving Credit Commitments at the time
of determination, as such amount may be reduced at or prior to such time
pursuant to the terms hereof.


 


“Letters of Credit” has the meaning given to
such term in Section 3.1.


 


“Leverage Ratio” means, as of the last day of
any Reference Period ending on the last day of a fiscal quarter, the ratio of (i) Consolidated
Funded Debt as of such date (minus (x) up to $25,000,000 of Consolidated
Funded Debt as of such date incurred pursuant to Franchisee Expansions and (y)
any Consolidated Funded Debt representing Franchisee Advance Payments), to (ii) Consolidated
EBITDA for such Reference Period.


 


“LIBOR Loan” means, at any time, any Loan that
bears interest at such time at the applicable Adjusted LIBOR Rate.


 


“LIBOR Rate” means, with respect to each LIBOR
Loan comprising part of the same Borrowing for any Interest Period, an interest rate per annum obtained by
dividing (i) (y) the rate of interest (rounded upward, if necessary, to
the nearest 1/16 of one percentage point) determined by reference to the
British Bankers’ Association Interest Settlement Rates for deposits in Dollars
(as set forth by the Bloomberg Information Services or any successor thereto or
any other service selected by the Administrative Agent which has been nominated
by the British Bankers’ Association as an authorized vendor for the purpose of
displaying such rates) or (z) if no such rate is available, the rate of
interest determined by the Administrative Agent to be the rate or the
arithmetic mean of rates (rounded upward, if necessary, to the nearest 1/16 of
one percentage point) at which Dollar deposits in immediately available funds
are offered to first-tier banks in the London interbank Eurodollar market, in
each case under (y) and (z) above
at approximately 11:00 a.m., London time, two (2) Business Days prior
to the first day of such Interest Period for a period substantially equal to
such Interest Period and in an amount substantially equal to the amount of
Wachovia’s LIBOR Loan comprising part of such Borrowing, by (ii) the
amount equal to 1.00 minus the Reserve Requirement (expressed as a decimal) for
such Interest Period.


 


“Lien” means any mortgage, pledge,
hypothecation, assignment, security interest, lien (statutory or otherwise),
charge or other encumbrance of any nature, whether voluntary or involuntary,
including, without limitation, the interest of any vendor or lessor under any
conditional sale agreement, title retention agreement, Capital Lease or any
other lease or arrangement having substantially the same effect as any of the
foregoing.


 


“Line of Business” means tax preparation,
financial services, business services and educational services and franchising
related thereto and other businesses related thereto or extensions thereof.


 


14





















 


 


“Loans” means any or all of the Revolving Loans
and the Swingline Loans.


 


“Margin Stock” has the meaning given to such
term in Regulation U.


 


“Material Adverse Effect” means a material
adverse effect upon (A) the business, assets, operations or condition
(financial or otherwise) of the Parent and its Subsidiaries, taken as a whole, (B) the
ability of the Parent and its Subsidiaries, taken as a whole, to perform their
obligations under this Agreement or any of the other Credit Documents or (C) the
legality, validity or enforceability of this Agreement or any of the other
Credit Documents or the rights and remedies of the Administrative Agent and the
Lenders hereunder and thereunder.


 


“Material Contract” has the meaning given to
such term in Section 5.19.


 


“Material Subsidiary” means each Subsidiary of
the Parent other than Subsidiaries that, in the aggregate, account for no more
than 5% of Consolidated Total Assets, 5% of consolidated net worth or 5% of
consolidated net revenues of the Parent.


 


“Multiemployer Plan” means any “multiemployer
plan” within the meaning of Section 4001(a)(3) of ERISA to which the
Borrowers or any ERISA Affiliate of the Borrowers makes, is making or is
obligated to make contributions or has made or been obligated to make
contributions.


 


“Notes” means any or all of the Revolving Notes
and the Swingline Note.


 


“Notice of Borrowing” has the meaning given to
such term in Section 2.2(b).


 


“Notice of Conversion/Continuation” has the
meaning given to such term in Section 2.11(b).


 


“Notice of Swingline Borrowing” has the meaning
given to such term in Section 2.2(d).


 


“Obligations” means all principal of and
interest (including interest accruing after the filing of a petition or
commencement of a case by or with respect to a Borrower seeking relief under
any applicable federal and state laws pertaining to bankruptcy, reorganization,
arrangement, moratorium, readjustment of debts, dissolution, liquidation or
other debtor relief, specifically including, without limitation, the Bankruptcy
Code and any fraudulent transfer and fraudulent conveyance laws, whether or not
the claim for such interest is allowed in such proceeding) on the Loans and
Reimbursement Obligations and all fees, expenses, indemnities and other
obligations owing, due or payable at any time by the Borrowers or any Guarantor
to the Administrative Agent, any Lender, the Swingline Lender, the Issuing
Lender or any other Person entitled thereto, under this Agreement or any of the
other Credit Documents, and all payment and other obligations owing or payable
at any time by the Borrowers to any Hedge Party under or in connection with any
Hedge Agreement required or permitted by this Agreement, in each case whether
direct or indirect, joint or several, absolute or contingent, matured or
unmatured, liquidated or unliquidated, secured or unsecured, and whether
existing by contract, operation of law or otherwise.


 


15





















 


“OFAC” means the
U.S. Department of the Treasury’s Office of Foreign Assets Control,
and any successor thereto.


 


“Office” means a
business that provides tax return preparation and other related services.


 


“Other Taxes” means all present or future stamp
or documentary taxes or any other excise or property taxes, charges or similar
levies arising from any payment made hereunder or under any other Credit
Document or from the execution, delivery or enforcement of, or otherwise with
respect to, this Agreement or any other Credit Document.


 


“Participant” has the meaning given to such
term in Section 11.6(d).


 


“PATRIOT Act” means the Uniting and
Strengthening America by Providing Appropriate Tools Required to Intercept and
Obstruct Terrorism USA PATRIOT Act of 2001), as amended from time to time, and
any successor statute, and all rules and regulations from time to time
promulgated thereunder.


 


“Payment Office” means the office of the
Administrative Agent designated on Schedule 1.1 under the heading “Instructions for
wire transfers to the Administrative Agent,” or such other office as the
Administrative Agent may designate to the Lenders and the Borrowers for such
purpose from time to time.


 


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


 


“Permitted Acquisition” means (A) any
Acquisition to which the Required Lenders (or the Administrative Agent on their
behalf) shall have given their prior written consent (which consent may be in
their sole discretion and may be given subject to such additional terms and
conditions as the Required Lenders shall establish) and with respect to which
all of the conditions and requirements set forth in this definition and in Section 6.8, and in or pursuant to any such consent, have been satisfied or
waived in writing by the Required Lenders (or the Administrative Agent on their
behalf), or (B) any Acquisition with respect to which all of the following
conditions are satisfied:


 


(i)                                     each business
acquired shall be within the Line of Business;


 


(ii)                                  any Capital
Stock given as consideration in connection therewith shall be Capital Stock of
the Parent;


 


(iii)                               no Default
or Event of Default shall have occurred and be continuing at the time of the
consummation of such Permitted Acquisition or would exist immediately after
giving effect thereto;


 


(iv)                              after giving effect to such Permitted Acquisition
and any Borrowings in connection therewith, the Borrowers shall be in
compliance with the financial covenants contained in ARTICLE VII,
such compliance determined with regard to calculations made on a Pro Forma
Basis for the Reference Period then most recently ended for which


 


16





















 


the
Administrative Agent has received the financial statements required by Section 6.1; and


 


(v)                                 all of the conditions and requirements of Section 6.8 applicable to such Acquisition are
satisfied.


 


“Permitted
Liens” has the meaning given to such term in Section 8.2.


 


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


 


“Plan”
means any “employee pension benefit plan” within the meaning of Section 3(2) of
ERISA that is subject to the provisions of Title IV of ERISA (other than a
Multiemployer Plan) and to which the Borrowers or any ERISA Affiliate of the
Borrowers may have any liability.


 


“Pro
Forma Balance Sheet” has the meaning given to such term in Section 4.1(i).


 


“Pro
Forma Basis” has the meaning given to such term in Section 1.3(c).


 


“Prohibited
Transaction” means any transaction described in (i) Section 406
of ERISA that is not exempt by reason of Section 408 of ERISA or by reason
of a Department of Labor prohibited transaction individual or class exemption
or (ii) Section 4975(c) of the Code that is not exempt by reason
of Section 4975(c)(2) or 4975(d) of the
Code.


 


“Projections”
has the meaning given to such term in Section 5.11(c).


 


“Reference
Period” with respect to any date of determination, means (except as may be
otherwise expressly provided herein) the period of twelve consecutive fiscal
months of the Borrowers immediately preceding such date or, if such date is the
last day of a fiscal quarter, the period of four consecutive fiscal quarters
ending on such date.


 


“Refunded
Swingline Loans” has the meaning given to such term in Section 2.2(e).


 


“Register”
has the meaning given to such term in Section 11.6(c).


 


“Regulations
D, T, U and X” means Regulations D, T, U and X, respectively, of the
Federal Reserve Board, and any successor regulations.


 


“Reimbursement
Obligation” has the meaning given to such term in Section 3.4.


 


“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.


 


“Reportable Event” means, with respect to any
Plan, (i) any “reportable event” within the meaning of Section 4043(c) of
ERISA for which the 30-day notice under Section 4043(a) of ERISA has
not been waived by the PBGC (including, without limitation, any failure to meet
the minimum funding standard of, or timely make any required installment under,
Section 412 of the


 


17





















 


Code
or Section 302 of ERISA, regardless of the issuance of any waivers in
accordance with Section 412(d) of the Code), (ii) any such “reportable
event” subject to advance notice to the PBGC under Section 4043(b)(3) of ERISA, (iii) any application for a funding
waiver or an extension of any amortization period pursuant to Section 412
of the Code, and (iv) a cessation of operations described in Section 4062(e) of
ERISA.


 


“Required Lenders” means, at any time, the
Lenders holding outstanding Loans (excluding Swingline Loans) and Unutilized
Revolving Credit Commitments (or, after the termination of the Revolving Credit
Commitments, outstanding Loans, Letter of Credit Exposure and participations in
outstanding Swingline Loans) representing at least a majority of the aggregate,
at such time, of all outstanding Loans (excluding Swingline Loans) and
Unutilized Revolving Credit Commitments (or, after the termination of the
Revolving Credit Commitments, the aggregate at such time of all outstanding
Loans, Letter of Credit Exposure and participations in outstanding Swingline
Loans).


 


“Requirement of Law” means, with respect to any
Person, the charter, articles or certificate of organization or incorporation
and bylaws or other organizational or governing documents of such Person, and
any statute, law, treaty, rule, regulation, order, decree, writ, injunction or
determination of any arbitrator or court or other Governmental Authority, in
each case applicable to or binding upon such Person or any of its property or
to which such Person or any of its property is subject or otherwise pertaining
to any or all of the transactions contemplated by this Agreement and the other
Credit Documents.


 


“Reserve Requirement” means, with respect to
any Interest Period, the reserve percentage (expressed as a decimal and rounded
upwards, if necessary, to the next higher 1/100th of 1%) in effect
from time to time during such Interest Period, as provided by the Federal
Reserve Board, applied for determining the maximum reserve requirements
(including, without limitation, basic, supplemental, marginal and emergency
reserves) applicable to Wachovia under Regulation D with respect to “Eurocurrency
liabilities” within the meaning of Regulation D, or under any similar or
successor regulation with respect to Eurocurrency liabilities or Eurocurrency
funding.


 


“Responsible Officer” means, with respect to
any Credit Party, the president, the chief executive officer, the chief
financial officer, any executive officer, or any other Financial Officer of
such Credit Party, and any other officer or similar official thereof
responsible for the administration of the obligations of such Credit Party in
respect of this Agreement or any other Credit Document.


 


“Revolver Increase” has the meaning set forth
in Section 2.20.


 


“Revolving Credit Commitment” means, with
respect to any Lender at any time, the commitment of such Lender to make
Revolving Loans in an aggregate principal amount at any time outstanding up to
the amount set forth opposite such Lender’s name on Schedule 1.1 under the
caption “Revolving Credit Commitment” or, if such Lender has entered into one
or more Assignment and Assumptions, the amount set forth for such Lender at
such time in the Register maintained by the Administrative Agent pursuant to Section 11.6(c) as such Lender’s “Revolving
Credit Commitment,” in either case, as such amount may be reduced at or prior
to such time pursuant to the terms hereof.


 


18





















 


“Revolving Credit Exposure” means, with respect
to any Revolving Credit Lender at any time, the sum of (i) the aggregate
principal amount of all Revolving Loans made by such Lender that are
outstanding at such time, (ii) such Lender’s Letter of Credit Exposure at
such time and (iii) such Lender’s Swingline Exposure at such time.


 


“Revolving Credit Lender” means any Lender
having a Revolving Credit Commitment (or, after the Revolving Credit
Commitments have terminated, any Lender holding outstanding Revolving Loans).


 


“Revolving Credit Maturity Date” means the
fifth anniversary of the Closing Date.


 


“Revolving Credit Termination Date” means the
Revolving Credit Maturity Date or such earlier date of termination of the
Revolving Credit Commitments pursuant to Section 2.5
or Section 9.2.


 


“Revolving Loans” has the meaning given to such
term in Section 2.1(a).


 


“Revolving Note” means, with respect to any
Revolving Credit Lender requesting the same, the promissory note of the
Borrowers in favor of such Revolving Credit Lender evidencing the Revolving
Loans made by such Lender pursuant to Section 2.l(a),
in substantially the form of Exhibit A-3, together with any amendments, modifications and supplements
thereto, substitutions therefor and restatements thereof.


 


“Sanctioned Country” means a country subject to
a sanctions program identified on the list maintained by OFAC and available at http://www.treas.gov/offices/eotffc/ofac/sanctions/index/html,
or as otherwise published from time to time.


 


“Sanctioned Person” means (i) a Person
named on the list of Specially Designated Nationals or Blocked Persons
maintained by OFAC available at
http://www.treas.gov/offices/eotffc/ofac/sdn/index/html, or as otherwise
published from time to time, or (ii) (A) an agency of the government
of a Sanctioned Country, (B) an organization controlled by a Sanctioned
Country, or (C) a Person resident in a Sanctioned Country, to the extent
subject to a sanctions program administered by OFAC.


 


“Senior Unsecured Notes” has the meaning given
to such term in Section 4.1(f).


 


“Stated Amount” means, with respect to any
Letter of Credit at any time, the aggregate amount available to be drawn
thereunder at such time (regardless of whether any conditions for drawing could
then be met).


 


“Subsidiary” means, with respect to any Person,
any corporation or other Person of which more than fifty percent (50%) of the
outstanding Capital Stock having ordinary voting power to elect a majority of
the board of directors, board of managers or other governing body of such
Person, is at the time, directly or indirectly, owned or controlled by such
Person and one or more of its other Subsidiaries or a combination thereof
(irrespective of whether, at the time, securities of any other class or classes
of any such corporation or other Person shall or might have voting power by
reason of the happening of any contingency). When used without reference to a
parent entity, the term “Subsidiary” shall be deemed to refer to a Subsidiary
of the Borrowers.


 


19





















 


“Swingline Commitment” means $10,000,000 or, if
less, the aggregate Revolving Credit Commitments at the time of determination,
as such amount may be reduced at or prior to such time pursuant to the terms
hereof.


 


“Swingline Exposure” means, with respect to any
Revolving Credit Lender at any time, its maximum aggregate liability to make
Refunded Swingline Loans pursuant to Section 2.2(e) to refund, or to
purchase participations pursuant to Section 2.2(f) in, Swingline Loans
that are outstanding at such time.


 


“Swingline Lender” means Wachovia in its
capacity as maker of Swingline Loans, and its successors in such capacity.


 


“Swingline Loans” has the meaning given to such
term in Section 2.1(b).


 


“Swingline Maturity Date” means the fifth (5th)
Business Day prior to the Revolving Credit Maturity Date.


 


“Swingline Note” means, if requested by the
Swingline Lender, the promissory note of the Borrowers in favor of the
Swingline Lender evidencing the Swingline Loans made by the Swingline Lender
pursuant to Section 2.1(b), in
substantially the form of Exhibit A-4, together with any amendments, modifications and supplements
thereto, substitutions therefor and restatements thereof.


 


“Taxes” means all present or future taxes,
levies, imposts, duties, deductions, withholdings, assessments, fees or other
charges imposed by any Governmental Authority, including any interest,
additions to tax or penalties applicable thereto.


 


“Total Voting Power” means, with respect to any
Person, the total number of votes which may be cast in the election of
directors of such Person at any meeting of stockholders of such Person if all
securities entitled to vote in the election of directors of such Person (on a
fully diluted basis, assuming the exercise, conversion or exchange of all
rights, warrants, options and securities exercisable for, exchangeable for or
convertible into, such voting securities) were present and voted at such
meeting (other than votes that may be cast only upon the happening of a
contingency).


 


“Type” ‘has the
meaning given to such term in Section 2.2(a).


 


“Unfunded Pension Liability” means, with
respect to any Plan, the excess of its benefit liabilities under Section 4001(a)(16) of ERISA over the current value of its assets,
determined in accordance with the applicable assumptions used for funding under
Section 412 of the Code for the applicable plan year.


 


“Unutilized Revolving Credit Commitment” means,
with respect to any Revolving Credit Lender at any time, such Lender’s
Revolving Credit Commitment at such time less the sum of (i) the
aggregate principal amount of all Revolving Loans made by such Lender that are
outstanding at such time, (ii) such Lender’s Letter of Credit Exposure at
such time and (iii) such Lender’s Swingline Exposure at such time.


 


20





















 


“Unutilized Swingline Commitment” means, with
respect to the Swingline Lender at any time, the Swingline Commitment at such
time less the aggregate principal amount of all Swingline Loans that are
outstanding at such time.


 


“Wachovia” means Wachovia Bank, National Association, and its
successors and assigns.


 


1.2                                 Accounting
Terms. Unless otherwise specified herein, all accounting terms
used herein shall be interpreted, all accounting determinations hereunder shall
be made, and all financial statements required to be delivered hereunder shall
be prepared in accordance with, GAAP applied on a basis consistent with the
most recent audited consolidated financial statements of the Parent and its
Subsidiaries delivered to the Lenders prior to the Closing Date; provided
that if the Borrowers notify the Administrative Agent that they wishes to amend
any financial covenant in ARTICLE VII to
eliminate the effect of any change in GAAP on the operation of such covenant
(or if the Administrative Agent notifies the Borrowers that the Required
Lenders wish to amend ARTICLE VII for such purpose), then the
Borrowers’ compliance with such covenant shall be determined on the basis of
GAAP as in effect immediately before the relevant change in GAAP became
effective, until either such notice is withdrawn or such covenant is amended in
a manner satisfactory to the Borrowers and the Required Lenders.


 


1.3                                 Other Terms;
Construction.


 


(a)                                  The definitions
of terms herein shall apply equally to the singular and plural forms of the
terms defined. Whenever the context may require, any pronoun shall include the
corresponding masculine, feminine and neuter forms. The words “include,”
“includes” and “including” shall be deemed to be followed by the
phrase “without limitation.” The word “will” shall
be construed to have the same meaning and effect as the word “shall.”
Unless the context requires otherwise, (i) any definition of or reference
to any agreement, instrument or other document shall be construed as referring
to such agreement, instrument or other document as from time to time amended,
supplemented, restated or otherwise modified (subject to any restrictions on
such amendments, supplements, restatements or modifications set forth herein or
in any other Credit Document), (ii) any reference herein to any Person
shall be construed to include such Person’s successors and assigns permitted
hereunder, (iii) the words “herein,” “hereof” and “hereunder,”
and words of similar import when used in any Credit Document, shall be
construed to refer to such Credit Document in its entirety and not to any
particular provision thereof, (iv) all references in a Credit Document to
Articles, Sections, Exhibits and Schedules shall be construed to refer to
Articles and Sections of, and Exhibits and Schedules to, the Credit Document in
which such references appear, (v) any reference to any law or regulation
herein shall, unless otherwise specified, refer to such law or regulation as
amended, modified or supplemented from time to time, and (vi) the words “asset” and “property” shall be construed to have the same
meaning and effect and to refer to any and all tangible and intangible assets
and properties, including cash, securities, accounts and contract rights.


 


(b)                                 All
references herein to the Lenders or any of them shall be deemed to include the
Issuing Lender and the Swingline Lender unless specifically provided otherwise
or unless the context otherwise requires.


 


21





















 


(c)                                  Notwithstanding
the foregoing, calculations of the financial covenants contained in ARTICLE VII to
determine whether a condition to a Permitted Acquisition, or a permitted
dividend or other distribution with respect to the Capital Stock of the
Borrowers or their Subsidiaries or the permitted purchase, redemption,
retirement or other acquisition of such Capital Stock has been met, shall be
determined in each case on a pro forma basis (a “Pro Forma Basis”) after giving effect to any such Acquisition, dividend or
distribution, purchase, redemption, retirement or other transaction (each, a “transaction”)
occurring during such period (or proposed to be consummated, as the case may
be) as if such transaction had occurred as of the first day of such period, in
accordance with the following:


 


(i)                                     any
Indebtedness incurred or assumed by any Credit Party in connection with any
transaction (including any Indebtedness of a Person acquired in a Permitted
Acquisition that is not retired or repaid in connection therewith) shall be
deemed to have been incurred or assumed as of the first day of the applicable
period (and if such Indebtedness has a floating or formula rate, such
Indebtedness shall, for purposes of such determination, have an implied rate of
interest during the applicable period determined by utilizing the rate of
interest that is or would be in effect with respect to such Indebtedness as of
the date of determination);


 


(ii)                                  any
Indebtedness retired or repaid in connection with any transaction (including
any Indebtedness of a Person acquired in a Permitted Acquisition) shall be
deemed to have been retired or repaid as of the first day of the applicable
period; and


 


(iii)                               with respect
to any Permitted Acquisition, income statement items (whether positive or
negative) and balance sheet items attributable to the Person or assets acquired
shall (to the extent not otherwise included in the consolidated financial
statements of the Parent and its Subsidiaries in accordance with GAAP or in
accordance with other provisions of this Agreement) be included in such
calculations to the extent relating to the applicable period.


 


ARTICLE II



AMOUNT AND TERMS OF THE LOANS


 


2.1                                 Commitments.


 


(a)                                  Each
Revolving Credit Lender severally agrees, subject to and on the terms and
conditions of this Agreement, to make loans (each, a “Revolving Loan,”
and collectively, the “Revolving Loans”) to the Borrowers, from time to
time on any Business Day during the period from and including the Closing Date
to but not including the Revolving Credit Termination Date, in an aggregate
principal amount at any time outstanding not exceeding its Revolving Credit
Commitment, provided that no Borrowing of Revolving Loans shall be made
if, immediately after giving effect thereto (and to any concurrent repayment of
Swingline Loans with proceeds of Revolving Loans made pursuant to such
Borrowing), (y) the Revolving Credit Exposure of any Revolving Credit Lender
would exceed its Revolving Credit Commitment at such time or (z) the Aggregate
Revolving Credit Exposure would exceed the aggregate Revolving Credit


 


22





















 


Commitments at such time. Subject to
and on the terms and conditions of this Agreement, the Borrowers may borrow, repay
and reborrow Revolving Loans.


 


(b)                                 The
Swingline Lender agrees, subject to and on the terms and conditions of this
Agreement, to make loans (each, a “Swingline Loan,” and collectively,
the “Swingline Loans”) to the Borrowers, from time to time on any Business
Day during the period from the Closing Date to but not including the Swingline
Maturity Date (or, if earlier, the Revolving Credit Termination Date), in an
aggregate principal amount at any time outstanding not exceeding the Swingline
Commitment. Swingline Loans may be made even if the aggregate principal amount
of Swingline Loans outstanding at any time, when added to the aggregate
principal amount of the Revolving Loans made by the Swingline Lender in its
capacity as a Revolving Credit Lender outstanding at such time and its Letter
of Credit Exposure at such time, would exceed the Swingline Lender’s own
Revolving Credit Commitment at such time, but provided that no Borrowing
of Swingline Loans shall be made if, immediately after giving effect thereto,
(y) the Revolving Credit Exposure of any Revolving Credit Lender would exceed
its Revolving Credit Commitment at such time or (z) the Aggregate Revolving
Credit Exposure would exceed the aggregate Revolving Credit Commitments at such
time. Subject to and on the terms and conditions of this Agreement, the
Borrowers may borrow, repay (including by means of a Borrowing of Revolving
Loans pursuant to Section 2.2(e))
and reborrow Swingline Loans.


 


2.2                                 Borrowings.


 


(a)                                  The
Revolving Loans shall, at the option of the Administrative Borrower and subject
to the terms and conditions of this Agreement, be either Base Rate Loans or
LIBOR Loans (each, a “Type” of
Loan), provided that (i) all Loans comprising the same Borrowing
shall, unless otherwise specifically provided herein, be of the same Type, and (ii) no
LIBOR Loans may be borrowed at any time prior to the third (3rd)
Business Day after the Closing Date. The Swingline Loans shall be made and
maintained as Base Rate Loans at all times.


 


(b)                                 In order to
make a Borrowing (other than (w) Borrowings of Swingline Loans, which shall be
made pursuant to Section 2.2(d), (x)
Borrowings for the purpose of repaying Refunded Swingline Loans, which shall be
made pursuant to Section 2.2(e), (y)
Borrowings for the purpose of paying unpaid Reimbursement Obligations, which
shall be made pursuant to Section 3.5,
and (z) Borrowings involving continuations or conversions of outstanding Loans,
which shall be made pursuant to Section 2.11),
the Administrative Borrower will give the Administrative Agent written notice
not later than 11:00 a.m., Charlotte time, three (3) Business Days
prior to each Borrowing to be comprised of LIBOR Loans and the day of each
Borrowing to be comprised of Base Rate Loans; provided, however,
that requests for the Borrowing of any Revolving Loans to be made on the
Closing Date may, at the discretion of the Administrative Agent, be given with
less advance notice than as specified hereinabove. Each such notice (each, a “Notice
of Borrowing”) shall be irrevocable, shall be given in the form of Exhibit B-1 and shall specify (1) the
aggregate principal amount and initial Type of the Loans to be made pursuant to
such Borrowing, (2) in the case of a Borrowing of LIBOR Loans, the initial
Interest Period to be applicable thereto, and (3) the requested Borrowing
Date, which shall be a Business Day. Upon its receipt of a Notice of Borrowing,
the Administrative Agent will promptly notify each applicable Lender of the
proposed Borrowing. Notwithstanding anything to the contrary contained herein:


 


23





















 


(i)                                     the
aggregate principal amount of each Borrowing comprised of Base Rate Loans shall
not be less than $3,000,000 or, if greater, an integral multiple of $1,000,000
in excess thereof (or, in the case of a Borrowing of Revolving Loans, if less,
in the amount of the aggregate Revolving Credit Commitments less the Aggregate
Revolving Credit Exposure), and the aggregate principal amount of each
Borrowing comprised of LIBOR Loans shall not be less than $3,000,000 or, if
greater, an integral multiple of $1,000,000 in excess thereof;


 


(ii)                                  if the
Borrowers shall have failed to designate the Type of Loans comprising a
Borrowing, the Borrowers shall be deemed to have requested a Borrowing comprised
of Base Rate Loans; and


 


(iii)                               if the
Borrowers shall have failed to select the duration of the Interest Period to be
applicable to any Borrowing of LIBOR Loans, then the Borrowers shall be deemed
to have selected an Interest Period with a duration of one month.


 


(c)                                  Not later
than 2:00 p.m., Charlotte time, on the requested Borrowing Date, each
applicable Lender will make available to the Administrative Agent at the
Payment Office an amount, in Dollars and in immediately available funds, equal
to the amount of the Loan or Loans to be made by such Lender. Subject to Section 2.3(b), to the extent such Lenders have made
such amounts available to the Administrative Agent as provided hereinabove, the
Administrative Agent will make the aggregate of such amounts available to the
Borrowers in accordance with Section 2.3(a) and
in like funds as received by the Administrative Agent.


 


(d)                                 In order to
make a Borrowing of a Swingline Loan, the Administrative Borrower will give the
Administrative Agent (and the Swingline Lender, if the Swingline Lender is not
also the Administrative Agent) written notice not later than 12:00 noon,
Charlotte time, on the date of such Borrowing. Each such notice (each, a “Notice
of Swingline Borrowing”) shall be given in the form of Exhibit B-2,
shall be irrevocable and shall specify (i) the principal amount of the
Swingline Loan to be made pursuant to such Borrowing (which shall not be less
than $100,000 and, if greater, shall be in an integral multiple of $100,000 in
excess thereof (or, if less, in the amount of the Unutilized Swingline
Commitment)) and (ii) the requested Borrowing Date, which shall be a
Business Day. Not later than 1:00 p.m., Charlotte time, on the requested
Borrowing Date, the Swingline Lender will make available to the Administrative
Agent at the Payment Office an amount, in Dollars and in immediately available
funds, equal to the amount of the requested Swingline Loan. To the extent the
Swingline Lender has made such amount available to the Administrative Agent as
provided hereinabove, the Administrative Agent will make such amount available
to the Borrowers in accordance with Section 2.3(a) and
in like funds as received by the Administrative Agent.


 


(e)                                  With respect
to any outstanding Swingline Loans, the Swingline Lender may at any time
(whether or not an Event of Default has occurred and is continuing) in its sole
and absolute discretion, and is hereby authorized and empowered by the
Borrowers to, cause a Borrowing of Revolving Loans to be made for the purpose of
repaying such Swingline Loans by delivering to the Administrative Agent (if the
Administrative Agent is not also the Swingline Lender) and each other Revolving
Credit Lender (on behalf of, and with a copy to, the Borrowers), not later than
11:00 a.m., Charlotte time, one (1) Business Day prior to the
proposed 


 


24





















 


Borrowing
Date therefore, a notice (which shall be deemed to be a Notice of Borrowing
given by the Borrowers) requesting the Revolving Credit Lenders to make
Revolving Loans (which shall be made initially as Base Rate Loans) on such
Borrowing Date in an aggregate amount equal to the amount of such Swingline
Loans (the “Refunded Swingline Loans”) outstanding on the date such
notice is given that the Swingline Lender requests to be repaid. Not later than
1:00 p.m., Charlotte time, on the requested Borrowing Date, each Revolving
Credit Lender (other than the Swingline Lender) will make available to the
Administrative Agent at the Payment Office an amount, in Dollars and in
immediately available funds, equal to the amount of the Revolving Loan to be
made by such Lender. To the extent the Revolving Credit Lenders have made such
amounts available to the Administrative Agent as provided hereinabove, the Administrative
Agent will make the aggregate of such amounts available to the Swingline Lender
in like funds as received by the Administrative Agent, which shall apply such
amounts in repayment of the Refunded Swingline Loans. Notwithstanding any
provision of this Agreement to the contrary, on the relevant Borrowing Date,
the Refunded Swingline Loans (including the Swingline Lender’s ratable share
thereof, in its capacity as a Revolving Credit Lender) shall be deemed to be
repaid with the proceeds of the Revolving Loans made as provided above
(including a Revolving Loan deemed to have been made by the Swingline Lender),
and such Refunded Swingline Loans deemed to be so repaid shall no longer be
outstanding as Swingline Loans but shall be outstanding as Revolving Loans. If
any portion of any such amount repaid (or deemed to be repaid) to the Swingline
Lender shall be recovered by or on behalf of the Borrowers from the Swingline
Lender in any bankruptcy, insolvency or similar proceeding or otherwise, the
loss of the amount so recovered shall be shared ratably among all the Revolving
Credit Lenders in the manner contemplated by Section 2.15(b).


 


(f)                                    If, as a result of any bankruptcy, insolvency or similar
proceeding with respect to any Borrower, Revolving Loans are not made pursuant
to Section 2.2(e) in an
amount sufficient to repay any amounts owed to the Swingline Lender in respect
of any outstanding Swingline Loans, or if the Swingline Lender is otherwise
precluded for any reason from giving a notice on behalf of the Borrowers as
provided for hereinabove, the Swingline Lender shall be deemed to have sold
without recourse, representation or warranty (except for the absence of Liens
thereon created, incurred or suffered to exist by, through or under the
Swingline Lender), and each Revolving Credit Lender shall be deemed to have
purchased and hereby agrees to purchase, a participation in such outstanding
Swingline Loans in an amount equal to its ratable share (based on the
proportion that its Revolving Credit Commitment bears to the aggregate
Revolving Credit Commitments at such time) of the unpaid amount thereof
together with accrued interest thereon. Upon one (1) Business Day’s prior
notice from the Swingline Lender, each Revolving Credit Lender (other than the
Swingline Lender) will make available to the Administrative Agent at the
Payment Office an amount, in Dollars and in immediately available funds, equal
to its respective participation. To the extent the Revolving Credit Lenders
have made such amounts available to the Administrative Agent as provided
hereinabove, the Administrative Agent will make the aggregate of such amounts
available to the Swingline Lender in like funds as received by the
Administrative Agent. In the event any such Revolving Credit Lender fails to
make available to the Administrative Agent the amount of such Lender’s
participation as provided in this Section 2.2(f), the Swingline Lender shall be
entitled to recover such amount on demand from such Lender, together with
interest thereon for each day from the date such amount is required to be made
available for the account of the Swingline Lender until the date such amount is
made available to the Swingline Lender at the Federal Funds Rate for the first
three (3) Business Days


 


25





















 


and thereafter at the
Adjusted Base Rate applicable to Revolving Loans. Promptly following its
receipt of any payment by or on behalf of the Borrowers in respect of a
Swingline Loan, the Swingline Lender will pay to each Revolving Credit Lender
that has acquired a participation therein such Lender’s
ratable share of such payment.


 


(g)                                 Notwithstanding
any provision of this Agreement to the contrary, the obligation of each
Revolving Credit Lender (other than the Swingline Lender) to make Revolving
Loans for the purpose of repaying any Refunded Swingline Loans pursuant to Section 2.2(e) and each such
Lender’s obligation to purchase a participation in any unpaid Swingline Loans
pursuant to Section 2.2(f) shall
be absolute and unconditional and shall not be affected by any circumstance or
event whatsoever, including, without limitation, (i) any set-off,
counterclaim, recoupment, defense or other right that such Lender may have
against the Swingline Lender, the Administrative Agent, the Borrowers or any
other Person for any reason whatsoever, (ii) the occurrence or continuance
of any Default or Event of Default, (iii) the failure of the amount of
such Borrowing of Revolving Loans to meet the minimum Borrowing amount
specified in Section 2.2(b), or (iv) the failure of any
conditions set forth in Section 4.2 or
elsewhere herein to be satisfied.


 


2.3                                 Disbursements;
Funding Reliance; Domicile of Loans.


 


(a)                                  The
Borrowers hereby authorize the Administrative Agent to disburse the proceeds of
each Borrowing in accordance with the terms of any written instructions from
any Authorized Officer of the Borrowers, provided that the
Administrative Agent shall not be obligated under any circumstances to forward
amounts to any account not listed in an Account Designation Letter. The
Borrowers may at any time deliver to the Administrative Agent an Account
Designation Letter listing any additional accounts or deleting any accounts
listed in a previous Account Designation Letter.


 


(b)                                 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 Section 2.2 or Section 3.5
and may, in reliance upon such assumption, make available to the
Borrowers 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 Borrowers severally agree to pay to
the Administrative Agent forthwith on demand such corresponding amount with
interest thereon, for each day from and including the date such amount is made
available to the Borrowers to but excluding the date of payment to the
Administrative Agent, at (i) 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 (ii) in the case of a payment to be made by the
Borrowers the Adjusted Base Rate. If the Borrowers 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 Borrowers the
amount of such interest paid by the Borrowers 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 Loan included in such
Borrowing.


 


26





















 


Any
payment by the Borrowers shall be without prejudice to any claim the Borrowers
may have against a Lender that shall have failed to make such payment to the
Administrative Agent.


 


(c)                                  The
obligations of the Lenders hereunder to make Loans, to fund participations in
Letters of Credit and Swingline Loans and to make payments pursuant to Section 11.1(c) are several and not joint. The
failure of any Lender to make any Loan, to fund any such participation or to
make any such payment on any date shall not relieve any other Lender of its
corresponding obligation, if any, hereunder to do so on such date, but no
Lender shall be responsible for the failure of any other Lender to so make its
Loan, purchase its participation or to make any such payment required
hereunder.


 


(d)                                 Each Lender
may, at its option, make and maintain any Loan at, to or for the account of any
of its Lending Offices, provided that any exercise of such option shall
not affect the obligation of the Borrowers to repay such Loan to or for the
account of such Lender in accordance with the terms of this Agreement.


 


2.4                                 Evidence of
Debt; Notes.


 


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


 


(b)                                 The
Administrative Agent shall maintain the Register pursuant to Section 11.6(c), and a subaccount for each Lender, in
which Register and subaccounts (taken together) shall be recorded (i) the
amount of each such Loan and Type of each such Loan and the Interest Period
applicable thereto, (ii) the amount of any principal or interest due and
payable or to become due and payable from the Borrowers to each Lender
hereunder in respect of each such Loan and (iii) the amount of any sum
received by the Administrative Agent hereunder from the Borrowers in respect of
each such Loan and each Lender’s share thereof.


 


(c)                                  The entries
made in the accounts, Register and subaccounts maintained pursuant to Section 2.4(b) (and, if consistent with the
entries of the Administrative Agent, Section 2.4(a))
shall, to the extent permitted by applicable law, be prima facie evidence of
the existence and amounts of the obligations of the Borrowers therein recorded,
absent manifest error; provided, however, that the failure of any
Lender or the Administrative Agent to maintain such account, such Register or
such subaccount, as applicable, or any error therein, shall not in any manner
affect the obligation of the Borrowers to repay (with applicable interest) the
Loans made to the Borrowers by such Lender in accordance with the terms of this
Agreement.


 


(d)                                 The Loans
made by each Lender shall, if requested by the applicable Lender (which request
shall be made to the Administrative Agent), be evidenced (i) in the case
of Revolving Loans, by a Revolving Note appropriately completed in
substantially the form of Exhibit A-1,
and (ii) in the case of the Swingline Loans, by a Swingline Note
appropriately completed in substantially the form of Exhibit A-2,
in each case executed by the Borrowers and payable to the order of such Lender.
Each Note shall be entitled to all of the benefits of this


 


27





















 


Agreement
and the other Credit Documents and shall be subject to the provisions hereof
and thereof.


 


2.5                                 Termination
and Reduction of Revolving Credit Commitments and Swingline Commitment.


 


(a)                                  The
Revolving Credit Commitments shall be automatically and permanently terminated
on the Revolving Credit Termination Date, unless sooner terminated pursuant to
any other provision of this Section 2.5
or Section 9.2. The
Swingline Commitment shall be automatically and permanently terminated on the
Swingline Maturity Date, unless sooner terminated pursuant to any other
provision of this Section 2.5
or Section 9.2.


 


(b)                                 At any time
and from time to time after the date hereof, upon not less than three (3) Business Days’ prior written notice
to the Administrative Agent (and in the case of a termination or reduction of
the Unutilized Swingline Commitment, the Swingline Lender), the Borrowers may
terminate in whole or reduce in part the aggregate Unutilized Revolving Credit
Commitments or the Unutilized Swingline Commitment, provided that any
such partial reduction shall be in an aggregate amount of not less than
$5,000,000 ($500,000 in the case of the Unutilized Swingline Commitment) or, if
greater, an integral multiple of $1,000,000 in excess thereof ($100,000 in the
case of the Unutilized Swingline Commitment). The amount of any termination or
reduction made under this Section 2.5(b) may
not thereafter be reinstated.


 


(c)                                  Each
reduction of the Revolving Credit Commitments pursuant to this Section shall
be applied ratably among the Revolving Credit Lenders according to their
respective Revolving Credit Commitments. Notwithstanding any provision of this
Agreement to the contrary, any reduction of the Revolving Credit Commitments
pursuant to this Section 2.5 that has the
effect of reducing the aggregate Revolving Credit Commitments to an amount less
than the amount of the Swingline Commitment or the Letter of Credit
Subcommitment at such time shall result in an automatic corresponding reduction
of the Swingline Commitment or the Letter of Credit Subcommitment, as the case
may be, to the amount of the aggregate Revolving Credit Commitments (as so
reduced), without any further action on the part of the Borrowers, the
Swingline Lender or any other Lender.


 


2.6                                 Mandatory
Payments and Prepayments.


 


(a)                                  Except to
the extent due or paid sooner pursuant to the provisions of this Agreement, (i) the
aggregate outstanding principal of the Revolving Loans shall be due and payable
in full on the Revolving Credit Maturity Date, and (ii) the aggregate
outstanding principal of the Swingline Loans shall be due and payable in full
on the Swingline Maturity Date.


 


(b)                                 In the event
that, at any time, the Aggregate Revolving Credit Exposure (excluding the
aggregate amount of any Swingline Loans to be repaid with proceeds of Revolving
Loans made on the date of determination) shall exceed the aggregate Revolving
Credit Commitments at such time (after giving effect to any concurrent
termination or reduction thereof), the Borrowers will immediately prepay the
outstanding principal amount of the Swingline Loans and, to the extent of any
excess remaining after prepayment in full of


 


28





















 


outstanding
Swingline Loans, the outstanding principal amount of the Revolving Loans in the
amount of such excess; provided that, to the extent such excess amount
is greater than the aggregate principal amount of Swingline Loans and Revolving
Loans outstanding immediately prior to the application of such prepayment, the
amount so prepaid shall be retained by the Administrative Agent and held in the
Cash Collateral Account as cover for Letter of Credit Exposure, as more
particularly described in Section 3.8, and thereupon such cash shall be deemed to reduce the
aggregate Letter of Credit Exposure by an equivalent amount.


 


2.7                                 Voluntary
Prepayments.


 


(a)                                  At any time
and from time to time, the Borrowers shall have the right to prepay the Loans,
in whole or in part, without premium or penalty (except as provided in clause (iii) below),
upon written notice given to the Administrative Agent not later than 11:00 a.m.,
Charlotte time, three (3) Business Days prior to each intended prepayment
of LIBOR Loans and one (1) Business Day prior to each intended prepayment
of Base Rate Loans (other than Swingline Loans, which may be prepaid on a
same-day basis), provided that (i) each partial prepayment of LIBOR
Loans shall be in an aggregate principal amount of not less than $3,000,000 or,
if greater, an integral multiple of $1,000,000 in excess thereof, and each
partial prepayment of Base Rate Loans shall be in an aggregate principal amount
of not less than $3,000,000 or, if greater, an integral multiple of $1,000,000
in excess thereof ($100,000 and $100,000, respectively, in the case of
Swingline Loans), (ii) no partial prepayment of LIBOR Loans made pursuant
to any single Borrowing shall reduce the aggregate outstanding principal amount
of the remaining LIBOR Loans under such Borrowing to less than $3,000,000 or to
any greater amount not an integral multiple of $1,000,000 in excess thereof,
and (iii) unless made together with all amounts required under Section 2.18
to be paid as a consequence of such prepayment, a prepayment of a LIBOR Loan
may be made only on the last day of the Interest Period applicable thereto.
Each such notice shall specify the proposed date of such prepayment and the
aggregate principal amount and Type of the Loans to be prepaid (and, in the
case of LIBOR Loans, the Interest Period of the Borrowing pursuant to which
made), and shall be irrevocable and shall bind the Borrowers to make such
prepayment on the terms specified therein. Revolving Loans and Swingline Loans
prepaid pursuant to this Section 2.7(a) may be reborrowed, subject to the terms and
conditions of this Agreement. In the event the Administrative Agent receives a
notice of prepayment under this Section, the Administrative Agent will give
prompt notice thereof to the Lenders; provided that if such notice has
also been furnished to the Lenders, the Administrative Agent shall have no
obligation to notify the Lenders with respect thereto.


 


(b)                                 Each
prepayment of the Loans made pursuant to Section 2.7(a) shall be applied ratably among the Lenders
holding the Loans being prepaid, in proportion to the principal amount held by
each.


 


2.8                                 Interest.


 


(a)                                  The
Borrowers will pay interest in respect of the unpaid principal amount of each
Loan, from the date of Borrowing thereof until such principal amount shall be
paid in full, (i) at the Adjusted Base Rate, as in effect from time to
time during such periods as such Loan is a Base


 


29





















 


Rate
Loan, and (ii) at the Adjusted LIBOR Rate, as in effect from time to time
during such periods as such Loan is a LIBOR Loan.


 


(b)                                 Upon the
occurrence and during the continuance of an Event of Default under Section 9.1(a), and (at the election of the Required
Lenders) upon the occurrence and during the continuance of any other Event of
Default, all outstanding principal amounts of the Loans and, to the greatest
extent permitted by law, all interest accrued on the Loans and all other
accrued and outstanding fees and other amounts hereunder, shall bear interest
at a rate per annum equal to the interest rate applicable from time to time
thereafter to such Loans (whether the Adjusted Base Rate or the Adjusted LIBOR
Rate) plus 2% (or, in the case of interest, fees and other amounts for which no
rate is provided hereunder, at the Adjusted Base Rate applicable to Revolving Loans
plus 2%), and, in each case, such default interest shall be payable on demand.
To the greatest extent permitted by law, interest shall continue to accrue
after the filing by or against any Borrower of any petition seeking any relief
in bankruptcy or under any law pertaining to insolvency or debtor relief.


 


(c)                                  Accrued (and
theretofore unpaid) interest shall be payable as follows:


 


(i)                                     in respect
of each Base Rate Loan (including any Base Rate Loan or portion thereof paid or
prepaid pursuant to the provisions of Section 2.6,
except as provided hereinbelow), in arrears on the last Business Day of each
calendar quarter, beginning with the first such day to occur after the Closing
Date; provided, that in the event the Loans are repaid or prepaid in
full and the Revolving Credit Commitments have been terminated, then accrued
interest in respect of all Base Rate Loans shall be payable together with such
repayment or prepayment on the date thereof;


 


(ii)                                  in respect
of each LIBOR Loan (including any LIBOR Loan or portion thereof paid or prepaid
pursuant to the provisions of Section 2.6,
except as provided hereinbelow), in arrears (y) on the last Business Day of the
Interest Period applicable thereto (subject to the provisions of Section 2.10(iv)) and (z)in addition, in the case of a LIBOR
Loan with an Interest Period having a duration of six months or longer, on each
date on which interest would have been payable under clause (y) above had
successive Interest Periods of three months’ duration been applicable to such
LIBOR Loan; provided, that in the event all LIBOR Loans made pursuant to
a single Borrowing are repaid or prepaid in full, then accrued interest in
respect of such LIBOR Loans shall be payable together with such repayment or
prepayment on the date thereof; and


 


(iii)                               in respect of
any Loan, at maturity (whether pursuant to acceleration or otherwise) and,
after maturity, on demand.


 


(d)                                 Nothing
contained in this Agreement or in any other Credit Document shall be deemed to
establish or require the payment of interest to any Lender at a rate in excess
of the maximum rate permitted by applicable law. If the amount of interest
payable for the account of any Lender on any interest payment date would exceed
the maximum amount permitted by applicable law to be charged by such Lender,
the amount of interest payable for its account on such interest payment date
shall be automatically reduced to such maximum permissible amount. In the event
of any such reduction affecting any Lender, if from time to time thereafter the


 


30





















 


amount
of interest payable for the account of such Lender on any interest payment date
would be less than the maximum amount permitted by applicable law to be charged
by such Lender, then the amount of interest payable for its account on such
subsequent interest payment date shall be automatically increased to such
maximum permissible amount, provided that at no time shall the aggregate
amount by which interest paid for the account of any Lender has been increased
pursuant to this sentence exceed the aggregate amount by which interest paid
for its account has theretofore been reduced pursuant to the previous sentence.


 


(e)                                  The
Administrative Agent shall promptly notify the Borrowers and the Lenders upon determining
the interest rate for each Borrowing of LIBOR Loans after its receipt of the
relevant Notice of Borrowing or Notice of Conversion/Continuation, and upon
each change in the Base Rate; provided, however, that the failure
of the Administrative Agent to provide the Borrowers or the Lenders with any
such notice shall neither affect any obligations of the Borrowers or the
Lenders hereunder nor result in any liability on the part of the Administrative
Agent to the Borrowers or any Lender. Each such determination (including each
determination of the Reserve Requirement) shall, absent manifest error, be
conclusive and binding on all parties hereto.


 


2.9                                 Fees. The
Borrowers agree to pay:


 


(a)                                  To the
Arranger and Wachovia, for their own respective accounts, on the Closing Date,
the fees required under the Fee Letter to be paid to them on the Closing Date,
in the amounts due and payable on the Closing Date as required by the terms
thereof;


 


(b)                                 To the
Administrative Agent, for the account of each Revolving Credit Lender, a
commitment fee for each calendar quarter (or portion thereof) for the period
from the date of this Agreement to the Revolving Credit Termination Date, at a
per annum rate equal to the Applicable Percentage in effect for such fee from
time to time during such quarter on such Lender’s ratable share (based on the
proportion that its Revolving Credit Commitment bears to the aggregate
Revolving Credit Commitments) of the average daily aggregate Unutilized
Revolving Credit Commitments (excluding clause (iii) of the definition
thereof for purposes of this Section 2.9(b) only), payable in
arrears (i) on the last Business Day of each calendar quarter, beginning
with the first such day to occur after the Closing Date, and (ii) on the
Revolving Credit Termination Date;


 


(c)                                  To the
Administrative Agent, for the account of each Revolving Credit Lender, a letter
of credit fee for each calendar quarter (or portion thereof) in respect of all
Letters of Credit outstanding during such quarter, at a per annum rate equal to
the Applicable Percentage in effect from time to time during such quarter for
Revolving Loans that are maintained as LIBOR Loans, on such Lender’s ratable
share (based on the proportion that its Revolving Credit Commitment bears to
the aggregate Revolving Credit Commitments) of the daily average aggregate
Stated Amount of such Letters of Credit, payable in arrears (i) on the
last Business Day of each calendar quarter, beginning with the first such day
to occur after the Closing Date, and (ii) on the later of the Revolving
Credit Termination Date and the date of termination of the last outstanding
Letter of Credit;


 


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(d)                                 To the
Issuing Lender, for its own account, a facing fee for each calendar quarter (or
portion thereof) in respect of all Letters of Credit outstanding during such
quarter, at a per annum rate of 0.125% on the daily average aggregate Stated
Amount of such Letters of Credit, payable in arrears (i) on the last
Business Day of each calendar quarter, beginning with the first such day to
occur after the Closing Date, and (ii) on the later of the Revolving
Credit Termination Date and the date of termination of the last outstanding
Letter of Credit;


 


(e)                                  To the
Issuing Lender, for its own account, such commissions, transfer fees and other
fees and charges incurred in connection with the issuance and administration of
each Letter of Credit as are customarily charged from time to time by the
Issuing Lender for the performance of such services in connection with similar
letters of credit, or as may be otherwise agreed to by the Issuing Lender, but
without duplication of amounts payable under Section 2.9(d); and


 


(f)                                    To the
Administrative Agent, for its own account, the annual administrative fee described
in the Fee Letter, on the terms, in the amount and at the times set forth
therein.


 


2.10                           Interest
Periods. Concurrently with the giving of a Notice of Borrowing or
Notice of Conversion/Continuation in respect of any Borrowing comprised of Base
Rate Loans to be converted into, or LIBOR Loans to be continued as, LIBOR
Loans, the Borrowers shall have the right to elect, pursuant to such notice,
the interest period (each, an “Interest Period”) to be applicable to
such LIBOR Loans, which Interest Period shall, at the option of the Borrowers,
be a one, two, three or six-month period; provided, however,
that:


 


(i)                                     all LIBOR Loans
comprising a single Borrowing shall at all times have the same Interest Period;


 


(ii)                                  the initial
Interest Period for any LIBOR Loan shall commence on the date of the Borrowing
of such LIBOR Loan (including the date of any continuation of, or conversion
into, such LIBOR Loan), and each successive Interest Period applicable to such
LIBOR Loan shall commence on the day on which the next preceding Interest
Period applicable thereto expires;


 


(iii)                               LIBOR Loans
may not be outstanding under more than eight (8) separate Interest Periods
at any one time (for which purpose Interest Periods shall be deemed to be
separate even if they are coterminous);


 


(iv)                              if any
Interest Period otherwise would expire on a day that is not a Business Day,
such Interest Period shall expire on the next succeeding Business Day unless
such next succeeding Business Day falls in another calendar month, in which
case such Interest Period shall expire on the next preceding Business Day;


 


(v)                                 the Borrowers
may not select any Interest Period that expires after the Revolving Credit
Maturity Date;


 


(vi)                              if any
Interest Period begins on a day for which there is no numerically corresponding
day in the calendar month during which such Interest Period would otherwise
expire, such Interest Period shall expire on the last Business Day of such
calendar month; and


 


32





















 


(vii)                           the Borrowers
may not select any Interest Period (and consequently, no LIBOR Loans shall be
made) if a Default or Event of Default shall have occurred and be continuing at
the time of such Notice of Borrowing or Notice of Conversion/Continuation with
respect to any Borrowing.


 


2.11                           Conversions
and Continuations.


 


(a)                                  The
Borrowers shall have the right, on any Business Day occurring on or after the
Closing Date, to elect (i) to convert all or a portion of the outstanding
principal amount of any Base Rate Loans into LIBOR Loans, or to convert any
LIBOR Loans the Interest Periods for which end on the same day into Base Rate
Loans, or (ii) upon the expiration of any Interest Period, to continue all
or a portion of the outstanding principal amount of any LIBOR Loans the Interest
Periods for which end on the same day for an additional Interest Period, provided
that (w) any such conversion of LIBOR Loans into Base Rate Loans shall involve
an aggregate principal amount of not less than $3,000,000 or, if greater, an
integral multiple of $1,000,000 in excess thereof; any such conversion of Base
Rate Loans into, or continuation of, LIBOR Loans shall involve an aggregate
principal amount of not less than $3,000,000 or, if greater, an integral
multiple of $1,000,000 in excess thereof; and no partial conversion of LIBOR
Loans made pursuant to a single Borrowing shall reduce the outstanding
principal amount of such LIBOR Loans to less than $3,000,000 or to any greater
amount not an integral multiple of $1,000,000 in excess thereof, (x) except as
otherwise provided in Section 2.16(f), LIBOR Loans may be converted into
Base Rate Loans only on the last day of the Interest Period applicable thereto
(and, in any event, if a LIBOR Loan is converted into a Base Rate Loan on any
day other than the last day of the Interest Period applicable thereto, the
Borrowers will pay, upon such conversion, all amounts required under Section 2.18 to be paid as a
consequence thereof), (y) no such conversion or continuation shall be permitted
with regard to any Base Rate Loans that are Swingline Loans, and (z) no
conversion of Base Rate Loans into LIBOR Loans or continuation of LIBOR Loans
shall be permitted during the continuance of a Default or Event of Default.


 


(b)                                 The
Borrowers shall make each such election by giving the Administrative Agent
written notice from the Administrative Borrower not later than 11:00 a.m.,
Charlotte time, three (3) Business Days prior to the intended effective
date of any conversion of Base Rate Loans into, or continuation of, LIBOR Loans
and one (1) Business Day prior to the intended effective date of any
conversion of LIBOR Loans into Base Rate Loans. Each such notice (each, a “Notice
of Conversion/Continuation”) shall be irrevocable, shall be given in the
form of Exhibit B-3 and shall
specify (x) the date of such conversion or continuation (which shall be a
Business Day), (y) in the case of a conversion into, or a continuation of,
LIBOR Loans, the Interest Period to be applicable thereto, and (z) the
aggregate amount and Type of the Loans being converted or continued. Upon the
receipt of a Notice of Conversion/Continuation, the Administrative Agent will
promptly notify each applicable Lender of the proposed conversion or
continuation. In the event that the Borrowers shall fail to deliver a Notice of
Conversion/Continuation as provided herein with respect to any outstanding
LIBOR Loans, such LIBOR Loans shall automatically be converted to Base Rate
Loans upon the expiration of the then current Interest Period applicable
thereto (unless repaid pursuant to the terms hereof). In the event the
Borrowers shall have failed to select in a Notice of Conversion/Continuation
the duration of the Interest Period to be applicable to any conversion into, or
continuation of, LIBOR Loans, then the Borrowers shall be deemed to have
selected an Interest Period with a duration of one
month.


 


33


















2.12                           Method of
Payments; Computations; Apportionment of Payments.


 


(a)                                  All payments
by the Borrowers hereunder shall be made without setoff, counterclaim or other
defense, in Dollars and in immediately available funds to the Administrative
Agent, for the account of the Lenders entitled to such payment or the Swingline
Lender, as the case may be (except as otherwise expressly provided herein as to
payments required to be made directly to the Issuing Lender or the Lenders) at
the Payment Office prior to 12:00 noon, Charlotte time, on the date payment is
due. Any payment made as required hereinabove, but after 12:00 noon, Charlotte
time (or such later time as the Administrative Agent shall agree), shall be
deemed to have been made on the next succeeding Business Day. If any payment
falls due on a day that is not a Business Day, then such due date shall be
extended to the next succeeding Business Day (except that in the case of LIBOR
Loans to which the provisions of Section 2.10(iv) are applicable, such
due date shall be the next preceding Business Day), and such extension of time
shall then be included in the computation of payment of interest, fees or other
applicable amounts.


 


(b)                                 The
Administrative Agent will distribute to the Lenders like amounts relating to payments
made to the Administrative Agent for the account of the Lenders as follows: (i) if
the payment is received by 12:00 noon, Charlotte time, in immediately available
funds, the Administrative Agent will make available to each relevant Lender on
the same date, by wire transfer of immediately available funds, such Lender’s
ratable share of such payment (based on the percentage that the amount of the
relevant payment owing to such Lender bears to the total amount of such payment
owing to all of the relevant Lenders), and (ii) if such payment is
received after 12:00 noon, Charlotte time, or in other than immediately
available funds, the Administrative Agent will make available to each such
Lender its ratable share of such payment by wire transfer of immediately
available funds on the next succeeding Business Day (or in the case of
uncollected funds, as soon as practicable after collected). If the
Administrative Agent shall not have made a required distribution to the
appropriate Lenders as required hereinabove after receiving a payment for the
account of such Lenders, the Administrative Agent will pay to each such Lender,
on demand, its ratable share of such payment with interest thereon at the
Federal Funds Rate for each day from the date such amount was required to be
disbursed by the Administrative Agent until the date repaid to such Lender. The
Administrative Agent will distribute to the Issuing Lender like amounts
relating to payments made to the Administrative Agent for the account of the
Issuing Lender in the same manner, and subject to the same terms and
conditions, as set forth hereinabove with respect to distributions of amounts
to the Lenders.


 


(c)                                  Unless the
Administrative Agent shall have received notice from the Borrowers prior to the
date on which any payment is due to the Administrative Agent for the account of
the Lenders or the Issuing Lender hereunder that the Borrowers will not make
such payment, the Administrative Agent may assume that the Borrowers have made
such payment on such date in accordance herewith and may, in reliance upon such
assumption, distribute to the Lenders or the Issuing Lender, as the case may
be, the amount due. In such event, if the Borrowers have not in fact made such
payment, then each of the Lenders or the Issuing Lender, as the case may be,
severally agrees to repay to the Administrative Agent forthwith on demand the
amount so distributed to such Lender or the Issuing Lender, 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


 


34





















 


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.


 


(d)                                 All
computations of interest and fees hereunder (including computations of the
Reserve Requirement) shall be made on the basis of a year consisting of (i) in
the case of interest on Base Rate Loans, 365/366
days, as the case may be, or (ii) in all other instances, 360 days; and in each case under (i) and
(ii) above, with regard to the actual number of days (including the first
day, but excluding the last day) elapsed.


 


(e)                                  Notwithstanding
any other provision of this Agreement or any other Credit Document to the
contrary, all amounts collected or received by the Administrative Agent or any
Lender after acceleration of the Loans pursuant to Section 9.2 pursuant
to the exercise by the Administrative Agent of its remedies shall be applied by
the Administrative Agent as follows:


 


(i)                                     first, to the
payment of all reasonable out-of-pocket costs and expenses (including, without
limitation, reasonable attorneys’ and consultants’ fees irrespective of whether
such fees are allowed as a claim after the occurrence of a Bankruptcy Event) of
the Administrative Agent in connection with enforcing the rights of the Lenders
under the Credit Documents;


 


(ii)                                  second, to the payment of any fees owed to
the Administrative Agent hereunder or under any other Credit Document;


 


(iii)                               third, to the
payment of all reasonable and documented out-of-pocket costs and expenses
(including, without limitation, reasonable attorneys’ and consultants’ fees
irrespective of whether such fees are allowed as a claim after the occurrence
of a Bankruptcy Event) of each of the Lenders in connection with enforcing its
rights under the Credit Documents or otherwise with respect to the Obligations
owing to such Lender;


 


(iv)                              fourth, to the
payment of all of the Obligations consisting of accrued fees and interest
(including, without limitation, fees incurred and interest accruing at the then
applicable rate after the occurrence of a Bankruptcy Event irrespective of
whether a claim for such fees incurred and interest accruing is allowed in such
proceeding), and including with respect to any Hedge Agreement between any
Credit Party and any Hedge Party (to the extent such Hedge Agreement is
required or permitted hereunder), any fees, premiums and scheduled periodic
payments due under such Hedge Agreement prior to any termination thereof and
any interest accrued thereon;


 


(v)                                 fifth, to the
payment of the outstanding principal amount of the Obligations (including the
payment of any outstanding Reimbursement Obligations and the obligation to cash
collateralize Letter of Credit Exposure), and including with respect to any
Hedge Agreement between any Credit Party and any Hedge Party (to the extent
such Hedge Agreement is required or permitted hereunder), any breakage,
termination or other payments due under such Hedge Agreement and any interest
accrued thereon;


 


(vi)                              sixth, to the payment of all other Obligations and other
obligations that shall have become due and payable under the Credit Documents
or otherwise and not repaid; and


 


35





















 


(vii)                           seventh, to the payment of the surplus (if
any) to whomever may be lawfully entitled to receive such surplus.


 


In
carrying out the foregoing, (x) amounts received shall be applied in the
numerical order provided until exhausted prior to application to the next
succeeding category, (y) all amounts shall be apportioned ratably among the
Lenders or Hedge Parties in proportion to the amounts of such principal,
interest, fees or other Obligations owed to them respectively pursuant to
clauses (iii) through (vii) above, and (z) to the extent that any amounts
available for distribution pursuant to clause (v) above are attributable
to the issued but undrawn amount of outstanding Letters of Credit, such amounts
shall be held by the Administrative Agent to cash collateralize Letter of
Credit Exposure pursuant to Section 3.8.


 


2.13                           Recovery of
Payments.


 


(a)                                  The
Borrowers agree that to the extent the Borrowers make a payment or payments to
or for the account of the Administrative Agent, the Swingline Lender, any
Lender or the Issuing Lender, which payment or payments or any part thereof are
subsequently invalidated, declared to be fraudulent or preferential, set aside
or required to be repaid to a trustee, receiver or any other party under any
bankruptcy, insolvency or similar state or federal law, common law or equitable
cause (whether as a result of any demand, settlement, litigation or otherwise),
then, to the extent of such payment or repayment, the Obligation intended to be
satisfied shall be revived and continued in full force and effect as if such
payment had not been received.


 


(b)                                 If any
amounts distributed by the Administrative Agent to any Lender are subsequently
returned or repaid by the Administrative Agent to the Borrowers, their
representatives or successors in interest, or any other Person, whether by
court order, by settlement approved by the Lender in question, or pursuant to
applicable Requirements of Law, such Lender will, promptly upon receipt of
notice thereof from the Administrative Agent, pay the Administrative Agent such
amount. If any such amounts are recovered by the Administrative Agent from the
Borrowers, their representatives or successors in interest or such other
Person, the Administrative Agent will redistribute such amounts to the Lenders
on the same basis as such amounts were originally distributed.


 


2.14                           Use of
Proceeds. The proceeds of the Loans shall be used (i) to repay
the Existing Senior Credit Facilities, the Bridge Credit Facility and the
Senior Unsecured Notes in full, (ii) to pay or reimburse permitted fees
and expenses in connection with the transactions contemplated hereby, and (ii) to
provide for working capital and general corporate purposes and in accordance
with the terms and provisions of this Agreement (including, without limitation,
to finance (x) Permitted Acquisitions and (y) dividends and stock redemptions
in accordance with Section 8.4).


 


2.15                           Pro Rata
Treatment.


 


(a)                                  Except in
the case of Swingline Loans, all fundings, continuations and conversions of
Loans shall be made by the Lenders pro rata on the basis of their respective
Revolving Credit Commitments to provide Loans (in the case of the funding of
Loans pursuant to Section 2.2) or on the basis of their respective outstanding Loans (in the
case of continuations


 


36





















 


and
conversions of Loans pursuant to Section 2.11, and additionally in all cases in the event the
Revolving Credit Commitments for Loans have expired or have been terminated),
as the case may be from time to time. All payments on account of principal of
or interest on any Loans, fees or any other Obligations owing to or for the
account of any one or more Lenders shall be apportioned ratably among such
Lenders in proportion to the amounts of such principal, interest, fees or other
Obligations owed to them respectively.


 


(b)                                 If any
Lender shall, by exercising any right of setoff or counterclaim or otherwise,
obtain payment in respect of any principal of or interest on any of its Loans
or other Obligations hereunder resulting in such Lender’s receiving payment of
a proportion of the aggregate amount of its Loans and accrued interest thereon
or other such Obligations greater than its pro rata share thereof as provided
herein, then the Lender receiving such greater proportion shall (a) notify
the Administrative Agent of such fact, and (b) purchase (for cash at face
value) participations in the Loans and such other Obligations of the other
Lenders, or make such other adjustments as shall be equitable, so that the
benefit of all such payments shall be shared by the Lenders ratably in
accordance with the aggregate amount of principal of and accrued interest on
their respective Loans and other amounts owing them, provided that (i) if
any such participations are purchased and all or any portion of the payment
giving rise thereto is recovered, such participations shall be rescinded and
the purchase price restored to the extent of such recovery, without interest,
and (ii) the provisions of this Section shall not be construed to
apply to (x) any payment made by the Borrowers pursuant to and in accordance
with the express terms of this Agreement or (y) any payment obtained by a
Lender as consideration for the assignment of or sale of a participation in any
of its Loans or participations in Reimbursement Obligations or Swingline Loans
to any assignee or participant, other than to the Borrowers or any Subsidiary
thereof (as to which the provisions of this Section 2.15(b) shall
apply). The Borrowers consent to the foregoing and agree, to the extent it may
effectively do so under applicable law, that any Lender acquiring a
participation pursuant to the foregoing arrangements may exercise against the
Borrowers rights of setoff and counterclaim with respect to such participation
as fully as if such Lender were a direct creditor of the Borrowers in the
amount of such participation. If under any applicable bankruptcy, insolvency or
similar law, any Lender receives a secured claim in lieu of a setoff to which
this Section 2.15(b) applies,
such Lender shall, to the extent practicable, exercise its rights in respect of
such secured claim in a manner consistent with the rights of the Lenders
entitled under this Section 2.15(b) to
share in the benefits of any recovery on such secured claim.


 


2.16                           Increased
Costs; Change in Circumstances; Illegality.


 


(a)                                  If any
Change in Law shall:


 


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


 


(ii)                                  subject any
Lender or the Issuing Lender to any tax of any kind whatsoever with respect to
this Agreement, any Letter of Credit, any participation in a Letter of Credit
or any LIBOR Loan made by it, or change the basis of taxation of payments to
such Lender or the Issuing Lender in respect thereof (except for Indemnified


 


37





















 


Taxes or Other Taxes covered by Section 2.17
and the imposition of, or any change in the rate of, any Excluded Tax payable
by such Lender or the Issuing Lender); or


 


(iii)                               impose on
any Lender or the Issuing Lender or the London interbank market any other
condition, cost or expense affecting this Agreement or LIBOR Loans made by such
Lender or any Letter of Credit or participation therein;


 


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


 


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


 


(c)                                  A
certificate of a Lender or the Issuing Lender setting forth the amount or
amounts necessary to compensate such Lender or the Issuing Lender or its
holding company, as the case may be, as specified in Section 2.16(a) or
Section 2.16(b) and delivered
to the Borrowers shall be conclusive absent manifest error. The Borrowers shall
pay such Lender or the Issuing Lender, as the case may be, the amount shown as
due on any such certificate within ten (10) days after receipt thereof.


 


(d)                                 Failure or
delay on the part of any Lender or the Issuing Lender to demand compensation
pursuant to the foregoing provisions of this Section shall not constitute
a waiver of such Lender’s or the Issuing Lender’s right to demand such
compensation, provided that the Borrowers shall not be required to
compensate a Lender or the Issuing Lender pursuant to the foregoing provisions
of this Section for any increased costs incurred or reductions suffered
more than 180 days prior to the date that such Lender or the Issuing Lender, as
the case may be, notifies the Borrowers of the Change in Law giving rise to
such increased costs or reductions and of such Lender’s or the Issuing Lender’s
intention to claim compensation therefor (except that, if


 


38





















 


 


the Change in Law
giving rise to such increased costs or reductions is retroactive, then the 180-day period referred to above shall
be extended to include the period of retroactive effect thereof).


 


(e)                                  If, on or
prior to the first day of any Interest Period, (y) the Administrative Agent
shall have determined that adequate and reasonable means do not exist for
ascertaining the applicable LIBOR Rate for such Interest Period or (z) the Administrative
Agent shall have received written notice from the Required Lenders of their
determination that the rate of interest referred to in the definition of “LIBOR
Rate” upon the basis of which the Adjusted LIBOR Rate for LIBOR Loans for such
Interest Period is to be determined will not adequately and fairly reflect the
cost to such Lenders of making or maintaining LIBOR Loans during such Interest
Period, the Administrative Agent will forthwith so notify the Borrowers and the
Lenders. Upon such notice, (i) all then outstanding LIBOR Loans shall
automatically, on the expiration date of the respective Interest Periods
applicable thereto (unless then repaid in full), be converted into Base Rate
Loans, (ii) the obligation of the Lenders to make, to convert Base Rate
Loans into, or to continue, LIBOR Loans shall be suspended (including pursuant
to the Borrowing to which such Interest Period applies), and (iii) any
Notice of Borrowing or Notice of Conversion/Continuation given at any time
thereafter with respect to LIBOR Loans shall be deemed to be a request for Base
Rate Loans, in each case until the Administrative Agent or the Required
Lenders, as the case may be, shall have determined that the circumstances
giving rise to such suspension no longer exist (and the Required Lenders, if
making such determination, shall have so notified the Administrative Agent),
and the Administrative Agent shall have so notified the Borrowers and the
Lenders.


 


(f)                                    Notwithstanding
any other provision in this Agreement, if, at any time after the date hereof
and from time to time, any Lender shall have determined in good faith that the
introduction of or any change in any applicable law, rule or regulation or
in the interpretation or administration thereof by any Governmental Authority
charged with the interpretation or administration thereof, or compliance with
any guideline or request from any such Governmental Authority (whether or not
having the force of law), has or would have the effect of making it unlawful
for such Lender to make or to continue to make or maintain LIBOR Loans, such
Lender will forthwith so notify the Administrative Agent and the Borrowers.
Upon such notice, (i) each of such Lender’s then outstanding LIBOR Loans
shall automatically, on the expiration date of the respective Interest Period
applicable thereto (or, to the extent any such LIBOR Loan may not lawfully be
maintained as a LIBOR Loan until such expiration date, upon such notice) and to
the extent not sooner prepaid, be converted into a Base Rate Loan, (ii) the
obligation of such Lender to make, to convert Base Rate Loans into, or to
continue, LIBOR Loans shall be suspended (including pursuant to any Borrowing
for which the Administrative Agent has received a Notice of Borrowing but for
which the Borrowing Date has not arrived), and (iii) any Notice of
Borrowing or Notice of Conversion/Continuation given at any time thereafter
with respect to LIBOR Loans shall, as to such Lender, be deemed to be a request
for a Base Rate Loan, in each case until such Lender shall have determined that
the circumstances giving rise to such suspension no longer exist and shall have
so notified the Administrative Agent, and the Administrative Agent shall have
so notified the Borrowers.


 


(g)                                 Notwithstanding
anything to the contrary contained in this Section 2.16, Section 2.17 shall
govern exclusively any increased costs relating to Taxes resulting from any
Change in Law.


 


39





















 


2.17                           Taxes.


 


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


 


(b)                                 Without
limiting the provisions of Section 2.17(a), the Borrowers shall timely pay any Other Taxes to the relevant
Governmental Authority in accordance with applicable law.


 


(c)                                  The
Borrowers shall indemnify the Administrative Agent, each Lender and the Issuing
Lender, within ten (10) days after demand therefore, for the full amount
of any Indemnified Taxes or Other Taxes (including Indemnified Taxes or Other
Taxes imposed or asserted on or attributable to amounts payable under this
Section) paid by the Administrative Agent, such Lender or the Issuing Lender,
as the case may be, and any penalties, interest and reasonable expenses arising
therefrom or with respect thereto, whether or not such Indemnified Taxes or
Other Taxes were correctly or legally imposed or asserted by the relevant
Governmental Authority. A certificate (along with a copy of the applicable
documents from the United States Internal Revenue Service or other Governmental
Authority that asserts such claim) as to the amount of such payment or
liability delivered to the Borrowers by a Lender or the Issuing Lender (with a
copy to the Administrative Agent), or by the Administrative Agent on its own
behalf or on behalf of a Lender or the Issuing Lender, shall be conclusive
absent manifest error.


 


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


 


(e)                                  Any Foreign
Lender that is entitled to an exemption from or reduction of withholding tax
under the law of the jurisdiction in which a Borrower is resident for tax
purposes, or any treaty to which such jurisdiction is a party, with respect to
payments hereunder or under any other Credit Document shall deliver to the
Borrowers (with a copy to the Administrative Agent), at the time or times
prescribed by applicable law or reasonably requested by the Borrowers or the
Administrative Agent, such properly completed and executed documentation
prescribed by applicable law as will permit such payments to be made without
withholding or at a reduced rate of withholding. In addition, any Lender, if
requested by the Borrowers or the Administrative Agent, shall deliver such
other documentation prescribed by applicable law or reasonably requested by the
Borrowers or the Administrative Agent as will


 


40





















 


enable the
Borrowers or the Administrative Agent to determine whether or not such Lender
is subject to backup withholding or information reporting requirements.


 


Without limiting the generality of the foregoing, in
the event that a Borrower is resident for tax purposes in the United States,
any Foreign Lender shall deliver to the Borrowers and the Administrative Agent
(in such number of copies as shall be requested by the recipient) on or prior
to the date on which such Foreign Lender becomes a Lender under this Agreement
(and from time to time thereafter upon the request of the Borrowers or the
Administrative Agent, but only if such Foreign Lender is legally entitled to do
so), whichever of the following is applicable:


 


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


 


(ii)                                  duly completed
copies of Internal Revenue Service Form W-8EC1,


 


(iii)                               in the case
of a Foreign Lender claiming the benefits of the exemption for portfolio
interest under Section 881(c) of the Code, (x) a certificate to the
effect that such Foreign Lender is not (A) a
“bank” within the meaning of Section 881(c)(3)(A) of the Code, (B) a
“10 percent shareholder” of a Borrower within the meaning of Section 881(c)(3)(B) of
the Code, or (C) a “controlled foreign corporation” described in Section 881(c)(3)(C) of
the Code and (y) duly completed copies of Internal Revenue Service Form W-8BEN,
or


 


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


 


(f)                                    If the
Administrative Agent, any Lender or the Issuing Lender determines, in its sole
discretion, that it has received a refund of any Taxes or Other Taxes as to
which it has been indemnified by the Borrowers or with respect to which the
Borrowers have paid additional amounts pursuant to this Section, it shall pay
to the Borrowers an amount equal to such refund (but only to the extent of
indemnity payments made, or additional amounts paid, by the Borrowers under
this Section with respect to the Taxes or Other Taxes giving rise to such
refund), net of all out-of-pocket expenses of the Administrative Agent, such
Lender or the Issuing Lender, as the case may be, and without interest (other
than any interest paid by the relevant Governmental Authority with respect to
such refund), provided that the Borrowers, upon the request of the
Administrative Agent, such Lender or the Issuing Lender, agrees to repay the
amount paid over to the Borrowers (plus any penalties, interest or other
charges imposed by the relevant Governmental Authority) to the Administrative
Agent, such Lender or the Issuing Lender in the event the Administrative Agent,
such Lender or the Issuing Lender is required to repay such refund to such
Governmental Authority. This Section 2.17(f) shall
not be construed to require the Administrative Agent, any Lender or the Issuing
Lender to make available its tax returns (or any other information relating to
its taxes that it deems confidential) to the Borrowers or any other Person.


 


41





















 


2.18                           Compensation. The
Borrowers will compensate each Lender upon demand for all losses, expenses and
liabilities (including, without limitation, any loss, expense or liability
incurred by reason of the liquidation or reemployment of deposits or other
funds required by such Lender to fund or maintain LIBOR Loans) that such Lender
may incur or sustain (i) if for any reason (other than a default by such
Lender) a Borrowing or continuation of, or conversion into, a LIBOR Loan does
not occur on a date specified therefor in a Notice of Borrowing or Notice of
Conversion/Continuation, (ii) if any repayment, prepayment or conversion
of any LIBOR Loan occurs on a date other than the last day of an Interest
Period applicable thereto (including as a consequence of any assignment made
pursuant to Section 2.19(a) or any
acceleration of the maturity of the Loans pursuant to Section 9.2),
(iii) if any prepayment of any LIBOR Loan is not made on any date
specified in a notice of prepayment given by the Borrowers or (iv) as a
consequence of any other failure by the Borrowers to make any payments with
respect to any LIBOR Loan when due hereunder. Calculation of all amounts
payable to a Lender under this Section 2.18
shall be made as though such Lender had actually funded its relevant LIBOR Loan
through the purchase of a Eurodollar deposit bearing interest at the LIBOR Rate
in an amount equal to the amount of such LIBOR Loan, having a maturity
comparable to the relevant Interest Period; provided, however,
that each Lender may fund its LIBOR Loans in any manner it sees fit and the
foregoing assumption shall be utilized only for the calculation of amounts
payable under this Section 2.18.
A certificate (which shall be in reasonable detail) showing the bases for the
determinations set forth in this Section 2.18
by any Lender as to any additional amounts payable pursuant to this Section 2.18 shall be submitted by such Lender to the
Borrowers either directly or through the Administrative Agent. Determinations
set forth in any such certificate made in good faith for purposes of this Section 2.18 of any such losses, expenses or
liabilities shall be conclusive absent manifest error.


 


2.19                           Replacement
of Lenders: Mitigation of Costs.


 


(a)                                  The
Borrowers may, at any time at their sole expense and effort, require any Lender
(i) that has requested compensation from the Borrowers under Sections 2.16(a) or 2.16(b) or
payments from the Borrower under Section 2.17,
(ii) the obligation of which to make or maintain LIBOR Loans has been
suspended under Section 2.16(f) or (iii) that
is a Defaulting Lender, in any case upon notice to such Lender and the
Administrative Agent, to assign and delegate, without recourse (in accordance
with and subject to the restrictions contained in, and consents required by, Section 11.6), all of its interests, rights and
obligations under this Agreement and the related Credit Documents to an
assignee that shall assume such obligations (which assignee may be another
Lender (but not an Affiliate of the affected Lender), if a Lender accepts such
assignment); provided that:


 


(i)                                     the Borrowers
shall have paid to the Administrative Agent the assignment fee specified in Section 11.6(b)(iv);


 


(ii)                                  such Lender
shall have received payment of an amount equal to the outstanding principal of
its Loans and any funded participations in Letters of Credit not refinanced
through the Borrowing of Revolving Loans, accrued interest thereon, accrued
fees and all other amounts payable to it hereunder and under the other Loan
Documents (including any amounts under Section 2.18)
from the assignee (to the extent of such


 


42





















 


outstanding principal
and accrued interest and fees) or the Borrowers (in the case of all other
amounts);


 


(iii)                               in the case
of any such assignment resulting from a request for compensation under Sections 2.16(a) or
2.16(b) or payments required to be
made pursuant to Section 2.17, such assignment will result in a reduction in such
compensation or payments thereafter; and


 


(iv)                              such assignment
does not conflict with applicable Requirements of Law.


 


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


 


(b)                                 If any
Lender requests compensation under Sections 2.16(a) or 2.16(b), or the
Borrowers are required to pay any additional amount to any Lender or any
Governmental Authority for the account of any Lender pursuant to Section 2.17,
or if any Lender gives a notice pursuant to Section 2.16(f), then such Lender shall use reasonable efforts to
designate a different Lending Office for funding or booking its Loans hereunder
or to assign its rights and obligations hereunder to another of its offices,
branches or affiliates, if, in the judgment of such Lender, such designation or
assignment (i) would eliminate or reduce amounts payable pursuant to Sections 2.16(a),
2.16(b) or 2.17,
as the case may be, in the future, or eliminate the need for the notice
pursuant to Section 2.16(f), as applicable, and (ii) in each case, would
not subject such Lender to any unreimbursed cost or expense and would not
otherwise be disadvantageous to such Lender. The Borrowers hereby agree to pay
all reasonable costs and expenses incurred by any Lender in connection with any
such designation or assignment.


 


2.20                           Increases of
Revolving Credit Commitments.


 


(a)                                  The parties
may, after consultation with the Administrative Agent (and notice from the
Administrative Agent to the Lenders), effect an increase in the aggregate
amount of the Revolving Credit Commitments (a “Revolver Increase”) as
set forth herein. Upon (i) the execution of a signature page to this
Agreement by an Eligible Assignee (or, in the case of an existing Lender, the
execution of a new signature page evidencing an increase in such Lender’s
Revolving Credit Commitment(s)) (in each case and in such capacity, an “Increasing
Lender”) and acceptance thereof by the Administrative Agent and the
Borrowers, (ii) the execution and delivery by the Borrowers of a Revolving
Note or Revolving Notes in favor of the Increasing Lender for such Increasing
Lender’s Revolving Credit Commitment(s) and Revolving Loans (and, in the case
of an Increasing Lender that is an existing Lender, the return of its existing
Revolving Note or Revolving Notes), and (iii) delivery of notice to the
other Lenders by the Administrative Agent setting forth the effective date of
the addition of the Increasing Lender hereunder and the amount of such
Increasing Lender’s Revolving Credit Commitment(s), such Increasing Lender
shall, without the necessity of any further action by any other Lender or
Agent, be for all purposes a Lender party to this Agreement to the same extent
as if it were an original party hereto with Revolving Credit Commitment(s) as
set forth on the signature page executed by the Increasing Lender (or, in
the case of Increasing Lender that is an existing Lender, such new signature page executed
by such Increasing Lender); provided, however, that


 


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the sum of (x) the
amount of all Unutilized Revolving Credit Commitments hereunder and (y) the
amount of all Loans outstanding hereunder shall not exceed in the aggregate
$300,000,000. Notwithstanding any provision to the contrary herein, each Lender
shall have the right, but not the obligation, to provide a portion of the
Revolver Increase hereunder in proportion to its pro rata share of the
aggregate Revolving Credit Commitments hereunder at the time of the request for
such Revolver Increase.


 


(b)                                 In the event
that on the effective date of a Revolver Increase (i) an Increasing Lender
is assuming a Revolving Credit Commitment (or, in the case of an Increasing
Lender that is an existing Lender, there is an increase in such Lender’s
Revolving Credit Commitment) and (ii) any Revolving Loans are then
outstanding, the Increasing Lender shall purchase a pro rata participating
interest in the Revolving Loans of each of the other Lenders. If breakage costs
for LIBOR Loans would result from such purchases, to the extent Revolving Loans
are outstanding as Base Rate Loans, such Increasing Lender shall first purchase
its participating interest in Base Rate Loans, but to the extent a Increasing
Lender purchases a participation in LIBOR Loans pursuant to this Section 2.20(b), any breakage costs incurred as a result of such purchases shall
be reimbursed by the Borrowers in accordance with Section 2.18.


 


(c)                                  The amount
of the Revolving Credit Commitments and obligations of all Lenders party hereto
prior to the addition of the Revolving Credit Commitment of any Increasing
Lender shall not be affected by the addition of such Increasing Lender, other
than the resulting adjustment to the pro rata share which each Lender has of
the aggregate Revolving Credit Commitments and Loans of the Increasing Lender,
it being intended that the Increasing Lender’s Revolving Credit Commitment(s)
and Loans shall be pari  passu with those of the other Lenders.


 


(d)                                 Notwithstanding
the foregoing, no Revolver Increase pursuant to this Section 2.20 shall
be effective unless (i) no Default of Event of Default shall have occurred
and be continuing on the date of notice requesting such Revolver Increase or on
the effective date of such increase, and (ii) the representations and
warranties set forth in ARTICLE V shall, if qualified by materiality, be true and correct in
all respects and if not so qualified, true and correct in all material
respects, on and as of each of said dates as if made on and as of said dates
(except to the extent any such representation or warranty is expressly stated
to have been made as of a specific date, in which case such representation or
warranty shall be, if otherwise qualified by materiality, true and correct in
all respects and if not so qualified, true and correct in all material
respects, as of such date).


 


ARTICLE III



LETTERS OF CREDIT


 


3.1                                 Issuance. Subject to
and upon the terms and conditions herein set forth, so long as no Default or
Event of Default has occurred and is continuing, the Issuing Lender will, at
any time and from time to time on and after the Closing Date and prior to the
earlier of (i) the Letter of Credit Maturity Date and (ii) the
Revolving Credit Termination Date, and upon request by the Borrowers in
accordance with the provisions of Section 3.2, issue for the account of the
Borrowers or their Subsidiaries one or more irrevocable standby letters of
credit denominated in Dollars and in a form customarily used or otherwise
approved by the Issuing Lender (together


 


44





















 


with
all amendments, modifications and supplements thereto, substitutions therefore
and renewals and restatements thereof and the Existing Letter of Credit, all
amendments, modifications and supplements to the Existing Letter of Credit,
substitutions for the Existing Letter of Credit and renewals and restatements
of the Existing Letter of Credit, collectively, the “Letters of Credit”).
The Stated Amount of each Letter of Credit shall not be less than such amount
as may be acceptable to the Issuing Lender. Notwithstanding the foregoing:


 


(a)                                  No Letter of
Credit shall be issued if the Stated Amount upon issuance (i) when added
to the aggregate Letter of Credit Exposure of the Revolving Credit Lenders at
such time, would exceed the Letter of Credit Subcommitment, or (ii) when
added to the Aggregate Revolving Credit Exposure, would exceed the aggregate
Revolving Credit Commitments at such time;


 


(b)                                 Notwithstanding
that a Letter of Credit issued or outstanding hereunder is in support of any
obligations of, or is for the account of, or otherwise will benefit, a
Subsidiary of a Borrower, the Borrowers shall be obligated to reimburse the
Issuing Lender hereunder for any and all drawings under such Letter of Credit
(and the Borrowers hereby acknowledge that the issuance of Letters of Credit
for the benefit of their Subsidiaries inures to the benefit of the Borrowers
and that the Borrowers’ business derives substantial benefits from the
businesses of such Subsidiaries);


 


(c)                                  No Letter of
Credit shall be issued that by its terms expires later than the Letter of
Credit Maturity Date or, in any event, more than one (1) year after its
date of issuance; provided, however, that a Letter of Credit may,
if requested by the Borrowers, provide by its terms, and on terms acceptable to
the Issuing Lender, for renewal for successive periods of one year or less (but
not beyond the Letter of Credit Maturity Date), unless and until the Issuing
Lender shall have delivered a notice of nonrenewal to the beneficiary of such
Letter of Credit; and


 


(d)                                 The Issuing
Lender shall be under no obligation to issue any Letter of Credit if, at the
time of such proposed issuance, (i) any order, judgment or decree of any
Governmental Authority or arbitrator shall purport by its terms to enjoin or
restrain the Issuing Lender from issuing such Letter of Credit, or any
Requirement of Law applicable to the Issuing Lender or any request or directive
(whether or not having the force of law) from any Governmental Authority with
jurisdiction over the Issuing Lender shall prohibit, or request that the
Issuing Lender refrain from, the issuance of letters of credit generally or
such Letter of Credit in particular or shall impose upon the Issuing Lender
with respect to such Letter of Credit any restriction or reserve or capital
requirement (for which the Issuing Lender is not otherwise compensated) not in
effect on the Closing Date, or any unreimbursed loss, cost or expense that was
not applicable, in effect or known to the Issuing Lender as of the Closing Date
and that the Issuing Lender in good faith deems material to it, or (ii) the
Issuing Lender shall have actual knowledge, or shall have received notice from
any Lender, prior to the issuance of such Letter of Credit that one or more of
the conditions specified in Section 4.1 (if applicable) or Section 4.2 are not then satisfied (or have not
been waived in writing as required herein) or that the issuance of such Letter
of Credit would violate the provisions of Section 3.l(a).


 


3.2                                 Notices. Whenever
the Borrowers desire the issuance of a Letter of Credit, the Administrative
Borrower will give the Issuing Lender written notice with a copy to the


 


45





















 


Administrative
Agent not later than 12:00 noon, Charlotte time, three (3) Business Days (or such shorter period as is acceptable to
the Issuing Lender in any given case) prior to the requested date of issuance
thereof. Each such notice (each, a “Letter of Credit Notice”) shall be
irrevocable, shall be given in the form of Exhibit B-4 and
shall specify (i) the requested date of issuance, which shall be a
Business Day, (ii) the requested Stated Amount and expiry date of the
Letter of Credit, and (iii) the name and address of the requested
beneficiary or beneficiaries of the Letter of Credit. The Borrowers will also
complete any application procedures and documents reasonably required by the
Issuing Lender in connection with the issuance of any Letter of Credit. Upon
its issuance of any Letter of Credit, the Issuing Lender will promptly notify
the Administrative Agent of such issuance, and the Administrative Agent will
give prompt notice thereof to each Revolving Credit Lender. The renewal or
extension of any outstanding Letter of Credit shall, for purposes of this ARTICLE III, be
treated in all respects as the issuance of a new Letter of Credit.


 


3.3                                 Participations.
Immediately upon the issuance of any Letter of Credit (and effective on the
date hereof with respect to the Existing Letter of Credit and without any
further action by any party to this Agreement), the Issuing Lender shall be
deemed to have sold and transferred to each Revolving Credit Lender, and each
Revolving Credit Lender shall be deemed irrevocably and unconditionally to have
purchased and received from the Issuing Lender, without recourse or warranty
(except for the absence of Liens thereon created, incurred or suffered to exist
by, through or under the Issuing Lender), an undivided interest and
participation, pro rata (based on the percentage of the aggregate Revolving
Credit Commitments represented by such Revolving Credit Lender’s Revolving
Credit Commitment), in such Letter of Credit, each drawing made thereunder and
the obligations of the Borrowers under this Agreement with respect thereto; provided,
however, that the fee relating to Letters of Credit described in Section 2.9(d) shall be payable directly to the
Issuing Lender as provided therein, and the other Revolving Credit Lenders
shall have no right to receive any portion thereof. In consideration and in
furtherance of the foregoing, each Revolving Credit Lender hereby absolutely
and unconditionally agrees to pay to the Administrative Agent, for the account
of the Issuing Lender, such Lender’s pro rata share (determined as provided
above) of each Reimbursement Obligation not reimbursed by the Borrowers on the
date due as provided in Section 3.4
or through the Borrowing of Revolving Loans as provided in Section 3.5
(because the conditions set forth in Section 4.2
cannot be satisfied. or for any other reason), or of any reimbursement payment
required to be refunded to the Borrowers for any reason. Upon any change in the
Revolving Credit Commitments of any of the Revolving Credit Lenders pursuant to
Section 11.6(a), with
respect to all outstanding Letters of Credit and Reimbursement Obligations
there shall be an automatic adjustment to the participations pursuant to this Section 3.3 to reflect the new pro rata shares of the
assigning Lender and the assignee. Each Revolving Credit Lender’s obligation to
make payment to the Issuing Lender pursuant to this Section 3.4
shall be absolute and unconditional and shall not be affected by any
circumstance whatsoever, including the termination of the Revolving Credit
Commitments or the existence of any Default or Event of Default, and each such
payment shall be made without any offset, abatement, reduction or withholding
whatsoever.


 


3.4                                 Reimbursement. The
Borrowers hereby agree to reimburse the Issuing Lender by making payment to the
Administrative Agent, for the account of the Issuing Lender, in immediately
available funds, for any payment made by the Issuing Lender under any Letter of


 


46





















 


Credit
(each such amount so paid until reimbursed, together with interest thereon
payable as provided hereinbelow, a “Reimbursement Obligation”)
immediately upon, and in any event on the same Business Day as, the making of
such payment by the Issuing Lender (provided that any such Reimbursement
Obligation shall be deemed timely satisfied (but nevertheless subject to the
payment of interest thereon as provided hereinbelow) if satisfied pursuant to a
Borrowing of Revolving Loans made on the date of such payment by the Issuing
Lender, as set forth more completely in Section 3.5), together with interest on the amount so paid by the
Issuing Lender, to the extent not reimbursed prior to 2:00 p.m., Charlotte
time, on the date of such payment or disbursement, for the period from the date
of the respective payment to the date the Reimbursement Obligation created
thereby is satisfied, at the Adjusted Base Rate applicable to Revolving Loans
as in effect from time to time during such period, such interest also to be
payable on demand. The Issuing Lender will provide the Administrative Agent and
the Borrowers with prompt notice of any payment or disbursement made or to be
made under any Letter of Credit, although the failure to give, or any delay in giving,
any such notice shall not release, diminish or otherwise affect the Borrowers’
obligations under this Section 3.4 or any other provision of this
Agreement. The Administrative Agent will promptly pay to the Issuing Lender any
such amounts received by it under this Section 3.4.


 


3.5                                 Payment by
Revolving Loans. In the event that the Issuing
Lender makes any payment under any Letter of Credit and the Borrowers shall not
have timely satisfied in full its Reimbursement Obligation to the Issuing
Lender pursuant to Section 3.4, and to the extent that any amounts
then held in the Cash Collateral Account established pursuant to Section 3.8
shall be insufficient to satisfy such Reimbursement Obligation in full, the
Issuing Lender will promptly notify the Administrative Agent, and the
Administrative Agent will promptly notify each Revolving Credit Lender, of such
failure. If the Administrative Agent gives such notice prior to 12:00 noon,
Charlotte time, on any Business Day, each Revolving Credit Lender will make available
to the Administrative Agent, for the account of the Issuing Lender, its pro
rata share (based on the percentage of the aggregate Revolving Credit
Commitments represented by such Lender’s Revolving Credit Commitment) of the
amount of such payment on such Business Day in immediately available funds. If
the Administrative Agent gives such notice after 12:00 noon, Charlotte time, on
any Business Day, each such Revolving Credit Lender shall make its pro rata
share of such amount available to the Administrative Agent on the next
succeeding Business Day. If and to the extent any Revolving Credit Lender shall
not have so made its pro rata share of the amount of such payment available to
the Administrative Agent, such Lender agrees to pay to the Administrative
Agent, for the account of the Issuing Lender, forthwith on demand such amount,
together with interest thereon at the Federal Funds Rate for each day from such
date until the date such amount is paid to the Administrative Agent. The
failure of any Revolving Credit Lender to make available to the Administrative
Agent its pro rata share of any payment under any Letter of Credit shall not
relieve any other Revolving Credit Lender of its obligation hereunder to make
available to the Administrative Agent its pro rata share of any payment under
any Letter of Credit on the date required, as specified above, but no Revolving
Credit Lender shall be responsible for the failure of any other Revolving
Credit Lender to make available to the Administrative Agent such other
Revolving Credit Lender’s pro rata share of any such payment. Each such payment
by a Revolving Credit Lender under this Section 3.5 of its pro rata share of an amount
paid by the Issuing Lender shall constitute a Revolving Loan by such Revolving
Credit Lender (the Borrowers being deemed to have given a timely Notice of
Borrowing therefor) and shall be treated as such for all purposes of this
Agreement; provided


 


47





















 


that
for purposes of determining the aggregate Unutilized Revolving Credit
Commitments immediately prior to giving effect to the application of the
proceeds of such Revolving Loans, the Reimbursement Obligation being satisfied
thereby shall be deemed not to be outstanding at such time. Each Revolving
Credit Lender’s obligation to make Revolving Loans pursuant to this Section 3.5 shall be absolute and unconditional and shall not be affected by
any circumstance whatsoever, including, without limitation, the existence of
any Default or Event of Default or the failure of the amount of such Borrowing
of Revolving Loans to meet the minimum Borrowing amount specified in Section 2.2(b);
provided, however, that each Revolving Credit Lender’s obligation
to make Revolving Loans pursuant to this Section 3.5 is subject to the conditions set
forth in Section 4.2 (other than delivery by the Borrowers of a Notice of
Borrowing).


 


3.6                                 Payment to
Revolving Credit Lenders. Whenever the Issuing Lender
receives a payment in respect of a Reimbursement Obligation as to which the
Administrative Agent has received, for the account of the Issuing Lender, any
payments from the Revolving Credit Lenders pursuant to Section 3.5,
the Issuing Lender will promptly pay to the Administrative Agent, and the
Administrative Agent will promptly pay to each Revolving Credit Lender that has
paid its pro rata share thereof, in immediately available funds, an amount
equal to such Revolving Credit Lender’s ratable share (based on the
proportionate amount funded by such Revolving Credit Lender to the aggregate
amount funded by all Revolving Credit Lenders) of such Reimbursement
Obligation.


 


3.7                                 Obligations
Absolute. The Reimbursement Obligations of the Borrowers shall be
irrevocable, shall remain in effect until the Issuing Lender shall have no further
obligations to make any payments or disbursements under any circumstances with
respect to any Letter of Credit, and shall be absolute and unconditional, shall
not be subject to counterclaim, setoff or other defense or any other
qualification or exception whatsoever and shall be made in accordance with the
terms and conditions of this Agreement under all circumstances. including, without limitation, any of the following
circumstances:


 


(a)                                  Any lack of
validity or enforceability of this Agreement, any of the other Credit Documents
or any documents or instruments relating to any Letter of Credit;


 


(b)                                 Any change
in the time, manner or place of payment of, or in any other term of, all or any
of the Obligations in respect of any Letter of Credit or any other amendment,
modification or waiver of or any consent to departure from any Letter of Credit
or any documents or instruments relating thereto, in each case whether or not
the Borrowers have notice or knowledge thereof;


 


(c)                                  The
existence of any claim, setoff, defense or other right that the Borrowers may
have at any time against a beneficiary named in a Letter of Credit, any
transferee of any Letter of Credit (or any Person for whom any such transferee
may be acting), the Administrative Agent, the Issuing Lender, any Lender or
other Person, whether in connection with this Agreement, any Letter of Credit,
the transactions contemplated hereby or any unrelated transactions (including
any underlying transaction between a Borrower and the beneficiary named in any
such Letter of Credit);


 


48





















 


(d)                                 Any draft,
certificate or any other document presented under the 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 (provided
that such draft, certificate or other document appears on its face to comply
with the terms of such Letter of Credit), any errors, omissions, interruptions
or delays in transmission or delivery of any messages, by mail, telecopier or
otherwise, or any errors in translation or in interpretation of technical
terms;


 


(e)                                  Any defense
based upon the failure of any drawing under a Letter of Credit to conform to
the terms of the Letter of Credit (provided that any draft, certificate
or other document presented pursuant to such Letter of Credit appears on its
face to comply with the terms thereof), any nonapplication or misapplication by
the beneficiary or any transferee of the proceeds of such drawing or any other
act or omission of such beneficiary or transferee in connection with such
Letter of Credit;


 


(f)                                    The
exchange, release, surrender or impairment of any collateral or other security
for the Obligations;


 


(g)                                 The
occurrence of any Default or Event of Default; or


 


(h)                                 Any other
circumstance or event whatsoever, including, without limitation, any other
circumstance that might otherwise constitute a defense available to, or a discharge of, the Borrowers or a guarantor.


 


Any action taken or omitted to be taken by the Issuing
Lender under or in connection with any Letter of Credit, if taken or omitted in
the absence of gross negligence or willful misconduct, shall be binding upon
the Borrowers and each Lender and shall not create or result in any liability of
the Issuing Lender to the Borrowers or any Lender. It is expressly understood
and agreed that, for purposes of determining whether a wrongful payment under a
Letter of Credit resulted from the Issuing Lender’s gross negligence or willful
misconduct, (i) the Issuing Lender’s acceptance of documents that appear
on their face to comply with the terms of such Letter of Credit, without
responsibility for further investigation, regardless of any notice or
information to the contrary, (ii) the Issuing Lender’s exclusive reliance
on the documents presented to it under such Letter of Credit as to any and all
matters set forth therein, including the amount of any draft presented under
such Letter of Credit, whether or not the amount due to the beneficiary thereunder
equals the amount of such draft and whether or not any document presented
pursuant to such Letter of Credit proves to be insufficient in any respect (so
long as such document appears on its face to comply with the terms of such
Letter of Credit), and whether or not any other statement or any other document
presented pursuant to such Letter of Credit proves to be forged or invalid or
any statement therein proves to be inaccurate or untrue in any respect
whatsoever, and (iii) any noncompliance in any immaterial respect of the
documents presented under such Letter of Credit with the terms thereof shall,
in each case, be deemed not to constitute gross negligence or willful
misconduct of the Issuing Lender.


 


3.8                                 Cash
Collateral Account. At any time and from time to time (i) after
the occurrence and during the continuance of an Event of Default, the
Administrative Agent may, and at the direction or with the consent of the
Required Lenders shall, require the Borrowers to deliver to the Administrative
Agent such additional amount of cash as is equal to 105% of the


 


49





















 


aggregate
Stated Amount of all Letters of Credit at any time outstanding (whether or not
any beneficiary under any Letter of Credit shall have drawn or be entitled at
such time to draw thereunder) and (ii) in the event of a prepayment under Section 2.6(b), the Administrative Agent will retain such amount as may then be
required to be retained, such amounts in each case under clauses (i) and (ii) above
to be held by the Administrative Agent in a cash collateral account (the “Cash
Collateral Account”). The Borrowers hereby grant to the Administrative
Agent, for the benefit of the Issuing Lender and the Lenders, a Lien upon and
security interest in the Cash Collateral Account and all amounts held therein
from time to time as security for Letter of Credit Exposure, and for
application to the Borrowers’ Reimbursement Obligations as and when the same
shall arise. The Administrative Agent shall have exclusive dominion and
control, including the exclusive right of withdrawal, over such account. Other
than any interest on the investment of such amounts in Cash Equivalents, which
investments shall be made at the direction of the Borrowers (unless a Default
or Event of Default shall have occurred and be continuing, in which case the
determination as to investments shall be made at the option and in the
discretion of the Administrative Agent), amounts in the Cash Collateral Account
shall not bear interest. Interest and profits, if any, on such investments
shall accumulate in such account. In the event of a drawing, and subsequent
payment by the Issuing Lender, under any Letter of Credit at any time during
which any amounts are held in the Cash Collateral Account, the Administrative
Agent will deliver to the Issuing Lender an amount equal to the Reimbursement
Obligation created as a result of such payment (or, if the amounts so held are
less than such Reimbursement Obligation, all of such amounts) to reimburse the
Issuing Lender therefore. Any amounts remaining in the Cash Collateral Account
(including interest) after the expiration of all Letters of Credit and
reimbursement in full of the Issuing Lender for all of its obligations
thereunder shall be held by the Administrative Agent, for the benefit of the
Borrowers, to be applied against the Obligations in such order and manner as
the Administrative Agent may direct. If the Borrowers are required to provide
cash collateral pursuant to Section 2.6(b), such amount (including interest), to
the extent not applied as aforesaid, shall be returned to the Borrowers on
demand, provided that after giving effect to such return (i) the
Aggregate Revolving Credit Exposure would not exceed the aggregate Revolving
Credit Commitments at such time and (ii) no default or Event of Default
shall have occurred and be continuing at such time. If the Borrowers are
required to provide cash collateral as a result of an Event of Default, such
amount (to the extent not applied as aforesaid) shall be returned to the
Borrowers within three (3) Business
Days after all Events of Default have been cured or waived.


 


3.9                                 The Issuing
Lender. The Issuing Lender shall act on behalf of the Lenders with
respect to any Letters of Credit issued by it and the documents associated
therewith, and the Issuing Lender shall have all of the rights, benefits and
immunities (a) provided to the Administrative Agent in ARTICLE X
with respect to any acts taken or omissions suffered by it in connection with
Letters of Credit issued by it or proposed to be issued by it and any documents
pertaining to such Letters of Credit as fully as if the term “Administrative
Agent” as used in ARTICLE X included the Issuing Lender with respect to such acts or
omissions, and (b) as
additionally provided herein with respect to the Issuing Lender.


 


3.10                           Effectiveness.
Notwithstanding any termination of the Revolving Credit Commitments or
repayment of the Loans, or both, the obligations of the Borrowers under this ARTICLE III shall remain in full force and effect until the Issuing Lender
and the Revolving


 


50





















 


Credit
Lenders shall have no further obligations to make any payments or disbursements
under any circumstances with respect to any Letter of Credit.


 


ARTICLE IV


 


CONDITIONS OF
BORROWING


 


4.1                                 Conditions
of Initial Borrowing. The obligation of each Lender to
make Loans in connection with the initial Borrowing
hereunder, and the obligation of the Issuing Lender to issue Letters of Credit
hereunder on the Closing Date, is subject to the satisfaction of the following
conditions precedent:


 


(a)                                  The
Administrative Agent shall have received the following,
each dated as of the Closing Date (unless otherwise specified) and in such
number of copies as the Administrative Agent shall have requested:


 


(i)                                     to the
extent requested by any Lender in accordance with Section 2.4(a), a
Note or Notes for such Lender, in each case duly completed in accordance with
the provisions of Section 2.4(a) and
executed by the Borrowers;


 


(ii)                                  the favorable
opinions of (A) Skadden, Arps, Slate, Meagher & Flom LLP, special
counsel to the Borrowers and their Subsidiaries, and (B) DLA Piper Rudnick
Gray Cary US LLP with respect to matters of Virginia law as may be reasonably
requested by the Administrative Agent, all in form and substance reasonably
satisfactory to the Administrative Agent.


 


(b)                                 The
Administrative Agent shall have received a certificate, signed by the
president, the chief executive officer or the chief financial officer of each
Borrower, dated the Closing Date and in form and substance reasonably
satisfactory to the Administrative Agent, certifying that (i) all
representations and warranties of the Credit Parties contained in this
Agreement and the other Credit Documents are, if otherwise qualified by
materiality, true and correct as of the Closing Date and if not so qualified,
true and correct in all material respects as of the Closing Date, both
immediately before and after giving effect to the consummation of the making of
the initial Loans and the application of the proceeds thereof (except to the
extent any such representation or warranty is expressly stated to have been
made as of a specific date, in which case such representation or warranty shall
be, if otherwise qualified by materiality, true and correct, and if not so
qualified, true and correct in all material respects, as of such date), (ii) no
Default or Event of Default has occurred and is continuing, both immediately
before and after giving effect to the making of the initial Loans and the
application of the proceeds thereof, (iii) both immediately before and
after giving effect to the making of the initial Loans and the application of
the proceeds thereof, no Material Adverse Effect has occurred since April 30,
2004, and there exists no event, condition or state of facts that could
reasonably be expected to result in a Material Adverse Effect, and (iv) all
conditions to the initial extensions of credit hereunder set forth in this Section 4.1 and in Section 4.2 have been satisfied or waived as
required hereunder.


 


(c)                                  The
Administrative Agent shall have received a certificate of the secretary or an
assistant secretary of each Credit Party executing any Credit Documents as of
the Closing Date,


 


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dated
the Closing Date and in form and substance reasonably satisfactory to the
Administrative Agent, certifying (i) that attached thereto is a true and
complete copy of the articles or certificate of incorporation, certificate of
formation or other organizational document and all amendments thereto of such
Credit Party, certified as of a recent date by the Secretary of State (or
comparable Governmental Authority) of its jurisdiction of organization, and
that the same has not been amended since the date of such certification, (ii) that
attached thereto is a true and complete copy of the bylaws, operating agreement
or similar governing document of such Credit Party, as then in effect and as in
effect at all times from the date on which the resolutions referred to in
clause (iii) below were adopted to and including the date of such
certificate, and (iii) that attached thereto is a true and complete copy
of resolutions adopted by the board of directors (or similar governing body) of
such Credit Party, authorizing the execution, delivery and performance of this
Agreement and the other Credit Documents to which it is a party, and as to the
incumbency and genuineness of the signature of each officer of such Credit
Party executing this Agreement or any of such other Credit Documents, and
attaching all such copies of the documents described above.


 


(d)                                 The
Administrative Agent shall have received a certificate as of a recent date of
the good standing of each Credit Party executing any Credit Documents as of the
Closing Date, under the laws of its jurisdiction of organization, from the
Secretary of State (or comparable Governmental Authority) of such jurisdiction.


 


(e)                                  All
approvals, permits and consents of any Governmental Authorities or material
approvals, permits and consents of other Persons required in connection with
the execution and delivery of this Agreement, the other Credit Documents and
the consummation of the transactions contemplated hereby shall have been
obtained, without the imposition of conditions that are not reasonably
acceptable to the Administrative Agent; and no action, proceeding,
investigation, regulation or legislation shall have been instituted, or to the
Borrowers’ knowledge, threatened before, and no order, injunction or decree
shall have been entered by, any court or other Governmental Authority, in each
case to enjoin, restrain or prohibit, to obtain substantial damages in respect
of, or to impose materially adverse conditions upon, this Agreement, any of the
other Credit Documents or the consummation of the transactions contemplated
hereby or that could reasonably be expected to have a Material Adverse Effect.


 


(f)                                    The
Administrative Agent shall have received reasonably satisfactory evidence that
concurrently with the making of the initial Loans hereunder, (i) all
principal, interest and other amounts outstanding under the existing senior
credit agreement dated as of June 25, 2004 between the Parent, Jackson
Hewitt, the lenders from time to time party thereto and JPMorgan Chase Bank, as
Administrative Agent (the “Existing Senior Credit Facilities”) and the
Credit Agreement dated as of May 26, 2005 between Wachovia, as lender and
Jackson Hewitt, as Borrower (the “Bridge Credit Facility”) and the $175
million Floating Rate Senior Notes due June 25, 2009 (the “Senior
Unsecured Notes”) shall be repaid and satisfied in full and all guarantees
by the Credit Parties relating thereto extinguished, (ii) all commitments
to extend credit under the agreements and instruments relating to the Existing
Senior Credit Facilities and the Bridge Credit Facility shall be terminated,
and (iii) any letters of credit outstanding under the Existing Senior
Credit Facilities for which any Credit Party is obligated shall have been
terminated, canceled or replaced.


 


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(g)                                 Since April 30,
2004, both immediately before and after giving effect to the to the making of
the initial Loans and the application of the proceeds thereof, there shall not
have occurred (i) a Material Adverse Effect or (ii) any event,
condition or state of facts that could reasonably be expected to have a
Material Adverse Effect.


 


(h)                                 The
Borrowers shall have paid (i) to the Arranger and Wachovia, the fees
required under the Fee Letter to be paid to them on the Closing Date, in the
amounts due and payable on the Closing Date as required by the terms thereof, (ii) to
the Administrative Agent, the initial payment of the annual administrative fee
described in the Fee Letter, and (iii) all other fees and reasonable
expenses of the Arranger, the Administrative Agent and the Lenders required
hereunder or under any other Credit Document to be paid on or prior to the
Closing Date (including reasonable fees and expenses of counsel) in connection
with this Agreement and the other Credit Documents.


 


(i)                                     The
Administrative Agent shall have received copies of the financial statements
referred to in Section 5.11(a).


 


(j)                                     The
Administrative Agent shall have received an executed Financial Condition
Certificate, attaching copies of the Projections and an unaudited consolidated
balance sheet of the Parent and its Subsidiaries as of the last day of the
fiscal quarter most recently ended prior to the Closing Date for which
financial statements of the Parent and its Subsidiaries are available and for
that portion of the current fiscal year then ended, giving pro forma effect to
the repayment of the Existing Senior Credit Facilities, the Bridge Credit
Facility and the Senior Unsecured Notes, the initial extensions of credit made
under this Agreement and the payment of transaction fees and expenses related
to the foregoing, all as if such events had occurred on such date (the “Pro
Forma Balance Sheet”), all of which shall be in form and substance
reasonably satisfactory to the Administrative Agent.


 


(k)                                  The
Administrative Agent shall have received evidence reasonably satisfactory to
the Administrative Agent that, as of the Closing Date, after giving pro forma
effect to the repayment of the Existing Senior Credit Facilities and the Senior
Unsecured Notes, the initial extensions of credit made under this Agreement and
the payment of transaction fees and expenses related to the foregoing, all as
if such events had occurred on such date, the Leverage Ratio shall not be
greater than 2.25 to 1.0.


 


(l)                                     The
Administrative Agent shall have received an Account Designation Letter,
together with written instructions from an Authorized Officer of each Borrower,
including wire transfer information, directing the payment of the proceeds of
the initial Loans to be made hereunder.


 


(m)                               Each of the
Administrative Agent and each Lender shall have received such other documents,
certificates, opinions and instruments in connection with the transactions
contemplated hereby as it shall have reasonably requested.


 


4.2                                 Conditions
of All Borrowings. The obligation of each Lender to
make any Loans hereunder, including the initial Loans (but excluding Revolving
Loans made for the purpose of repaying Refunded Swingline Loans pursuant to Section 2.2(e) or for the purpose of paying


 


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unpaid
Reimbursement Obligations pursuant to Section 3.5), and the obligation of the Issuing Lender to issue any Letters
of Credit hereunder, is subject to the satisfaction of the following conditions
precedent on the relevant Borrowing Date or date of issuance:


 


(a)                                  The
Administrative Agent shall have received a Notice of Borrowing in accordance
with Section 2.2(b), or (together with
the Swingline Lender) a Notice of Swingline Borrowing in accordance with Section 2.2(d), or (together with the Issuing
Lender) a Letter of Credit Notice in accordance with Section 3.2, as applicable;


 


(b)                                 Each of the
representations and warranties contained in ARTICLE V
and in the other Credit Documents shall be, if otherwise qualified by
materiality, true and correct, and if not so qualified, true and correct in all
material respects, on and as of such Borrowing Date (including the Closing
Date, in the case of the initial Loans made hereunder) or date of issuance of a
Letter of Credit with the same effect as if made on and as of such date, both
immediately before and after giving effect to the Loans to be made or Letter of
Credit to be issued on such date (except to the extent any such representation
or warranty is expressly stated to have been made as of a specific date, in
which case such representation or warranty shall be, if otherwise qualified by
materiality, true and correct or if not so qualified, true and correct in all
material respects, as of such date); and


 


(c)                                  No Default
or Event of Default shall have occurred and be continuing on such date, both
immediately before and after giving effect to the Loans to be made or Letter of
Credit to be issued on such date.


 


Each
giving of a Notice of Borrowing, a Notice of Swingline Borrowing or a Letter of
Credit Notice, and the consummation of each Borrowing or issuance of a Letter
of Credit, shall be deemed to constitute a representation by the Borrowers that
the statements contained in Sections 4.2(b) and
4.2(c) are true, both as of the
date of such notice or request and as of the relevant Borrowing Date or date of
issuance.


 


ARTICLE V


 


REPRESENTATIONS AND WARRANTIES


 


To induce the Administrative Agent, the Issuing Lender
and the Lenders to enter into this Agreement and to induce the Lenders to
extend the credit contemplated hereby and the Issuing Lender to issue Letters
of Credit, each of the Borrowers represents and warrants to the Administrative
Agent, the Issuing Lender and the Lenders as follows:


 


5.1                                 Corporate
Organization and Power. Each Credit Party (i) is a
corporation or a limited liability company duly organized or formed, validly
existing and in good standing under the laws of the jurisdiction of its
incorporation or formation, as the case may be, (ii) has the full
corporate or limited liability company power and authority to execute, deliver
and perform the Credit Documents to which it is or will be a party, to own and
hold its property and to engage in its business as presently conducted, and (iii) is
duly qualified to do business as a foreign corporation or limited liability
company and is in good standing in each jurisdiction where the nature of its
business or the ownership of its properties requires it to be so qualified, except


 


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where the failure
to be so qualified, individually or in the aggregate, could not reasonably be
expected to have a Material Adverse Effect.


 


5.2                                 Authorization;
Enforceability. Each Credit Party has taken, or on
the Closing Date will have taken, all necessary corporate or limited liability
action, as applicable, to execute, deliver and perform each of the Credit
Documents to which it is or will be a party, and has, or on the Closing Date
(or any later date of execution and delivery) will have, validly executed and
delivered each of the Credit Documents to which it is or will be a party. This
Agreement constitutes, and each of the other Credit Documents upon execution
and delivery will constitute, the legal, valid and binding obligation of each
Credit Party that is a party hereto or thereto, enforceable against it in
accordance with its terms, except as enforceability may be limited by
bankruptcy, insolvency, reorganization, moratorium or other similar laws
affecting creditors’ rights generally, by general equitable principles or by
principles of good faith and fair dealing (regardless of whether enforcement is
sought in equity or at law).


 


5.3                                 No Violation. The
execution, delivery and performance by each Credit Party of each of the Credit
Documents to which it is or will be a party, and compliance by it with the
terms hereof and thereof, do not and will not (i) violate any provision of
its articles or certificate of incorporation or formation, its bylaws or
operating agreement, or other applicable formation or organizational documents,
(ii) contravene any other Requirement of Law applicable to it, (iii) conflict
with, result in a breach of or constitute (with notice, lapse of time or both)
a default under any indenture, mortgage, lease, agreement, contract or other
instrument to which it is a party, by which it or any of its properties is
bound or to which it is subject, or (iv) result in or require the creation
or imposition of any Lien upon any of its properties, revenues or assets;
except, in the case of clauses (ii) and (iii) above, where such
violations, conflicts, breaches or defaults, individually or in the aggregate,
could not reasonably be expected to have a Material Adverse Effect.


 


5.4                                 Governmental
and Third-Party Authorization; Permits. No consent,
approval, authorization or other action by, notice to, or registration or
filing with, any Governmental Authority or other Person is or will be required
as a condition to or otherwise in connection with the due execution, delivery
and performance by each Credit Party of this Agreement or any of the other
Credit Documents to which it is or will be a party or the legality, validity or
enforceability hereof or thereof, other than (i) consents, authorizations
and filings that have been (or on or prior to the Closing Date will have been)
made or obtained and that are (or on the Closing Date will be) in full force
and effect, which consents, authorizations and filings are listed on Schedule 5.4,
and (ii) consents and filings the failure to obtain or make which,
individually or in the aggregate, could not reasonably be expected to have a
Material Adverse Effect. Each Credit Party has, and is in good standing with
respect to, all governmental approvals, licenses, permits and authorizations
necessary to conduct its business as presently conducted and to own or lease
and operate its properties, except for those the failure to obtain which,
individually or in the aggregate, could not reasonably be expected to have a Material
Adverse Effect.


 


5.5                                 Litigation. Except as
disclosed in the Parent’s public filings with the United States Securities and
Exchange Commission as of the Closing Date, there are no actions,
investigations, suits or proceedings pending or, to the knowledge of the
Borrowers, threatened, at law, in equity or in arbitration, before any court,
other Governmental Authority, arbitrator or


 


55





















 


other
Person, (i) against or affecting the Parent or its Subsidiaries or any of
their respective properties that, if adversely determined, could reasonably be
expected to have a Material Adverse Effect, or (ii) with respect to this
Agreement, any of the other Credit Documents or any of the transactions
contemplated hereby or thereby.


 


5.6                                 Taxes. Each of
the Parent and its Subsidiaries has timely filed all federal, state, local and
foreign tax returns and reports required to be filed by it and has paid, prior
to the date on which penalties would attach thereto or a Lien would attach to
any of the properties of a Credit Party if unpaid, all taxes, assessments, fees
and other charges levied upon it or upon its properties that are shown thereon
as due and payable, except (i) those that are not yet delinquent or that
are being contested in good faith and by proper proceedings and for which
adequate reserves have been established in accordance with GAAP or (ii) to
the extent the failure to do so could not reasonably be expected to have a
Material Adverse Effect.


 


5.7                                 Subsidiaries. Schedule 5.7
sets forth a list, as of the Closing Date, of all of the Subsidiaries of the
Borrowers (including the other Borrowers) and as to each such Subsidiary, the
percentage ownership (direct and indirect) of each Borrower in each class of
its Capital Stock and each direct owner thereof.


 


5.8                                 Full
Disclosure. All factual information heretofore,
contemporaneously or hereafter furnished in writing to the Administrative
Agent, the Arranger or any Lender by or on behalf of the Parent and its
Subsidiaries for purposes of or in connection with this Agreement, the other
Credit Documents and the transactions contemplated hereby, when taken as a
whole, is or will be true and accurate in all material respects on the date as
of which such information is dated or certified (or, if such information has
been updated, amended or supplemented, on the date as of which any such update,
amendment or supplement is dated or certified) and not made incomplete by
omitting to state a material fact necessary to make the statements contained
herein and therein, in light of the circumstances under which such information
was provided, not misleading; provided that, with respect to
projections, budgets and other estimates, except as specifically represented in
Section 5.11(c), the Borrowers represent only that
such information was prepared in good faith based upon assumptions believed to
be reasonable at the time (it being understood that such projections, budgets
and estimates are subject to significant uncertainties and there can be no
assurance the results therein will be achieved); provided, further,
that with respect to general industry information provided by public or third
party sources, the Borrowers represent only to the best of their knowledge.


 


5.9                                 Margin
Regulations. None of the Parent or its Subsidiaries is engaged
principally, or as one of its important activities, in the business of
extending credit for the purpose of purchasing or carrying Margin Stock. No
proceeds of the Loans will be used, directly or indirectly, to purchase or
carry any Margin Stock, to extend credit for such purpose or for any other
purpose, in each case that would violate or be inconsistent with Regulations T,
U or X or any provision of the Exchange Act.


 


5.10                           No Material
Adverse Effect. Since April 30, 2004, there
has been no material adverse effect on (a) the ability of the Parent and
its Subsidiaries, taken as a whole, to perform their obligations under this
Agreement or any of the other Credit Documents, or (b) the legality,
validity or enforceability of this Agreement or any of the other Credit
Documents or the rights


 


56





















 


and remedies of the
Administrative Agent and the Lenders hereunder or thereunder and there exists
no event, condition or state of facts that could reasonably be expected to
result in such material adverse effect.


 


5.11                           Financial
Matters.


 


(a)                                  The
Borrowers have heretofore furnished to the Administrative Agent copies of (i) the
audited consolidated balance sheets of the Parent and its Subsidiaries as of April 30,
2004 and 2003, in each case with the related statements of income and cash
flows for the fiscal years then ended, together with the opinion of Deloitte &
Touche LLP thereon, and (ii) the unaudited consolidated balance sheet of
the Parent and its Subsidiaries as of January 31, 2005, and the related
statements of income and cash flows for the nine-month period then ended. Such
financial statements have been prepared in accordance with GAAP (subject, with
respect to the unaudited financial statements, to the absence of notes required
by GAAP and to normal year-end adjustments) and present fairly in all material
respects the financial condition of the Parent and its Subsidiaries on a
consolidated basis as of the respective dates thereof and the results of
operations of the Parent and its Subsidiaries on a consolidated basis for the
respective periods then ended. Except as fully reflected in the most recent
financial statements referred to above and the notes thereto, there are no material
liabilities or obligations with respect to the Parent and its Subsidiaries of
any nature whatsoever (whether absolute, contingent or otherwise and whether or
not due) that are required in accordance with GAAP to be reflected in such
financial statements and that are not so reflected.


 


(b)                                 The Pro
Forma Balance Sheet gives pro forma effect to the consummation of the repayment
of the Existing Senior Credit Facilities, repayment of the Bridge Credit
Facility and repayment of the Senior Unsecured Notes, the initial extensions of
credit made under this Agreement and the payment of transaction fees and
expenses related to the foregoing, all as if such events had occurred on the
date as of which the Pro Forma Balance Sheet is prepared. The Pro Forma Balance
Sheet has been prepared in accordance with the requirements of Regulation S-X
under the Exchange Act and, based on stated assumptions made in good faith and
having a reasonable basis set forth therein, presents fairly in all material
respects the consolidated financial condition of the Parent and its
Subsidiaries on an unaudited Pro Forma Basis as of the date set forth therein
after giving effect to the consummation of the transactions described above.


 


(c)                                  The
Borrowers have prepared, and have heretofore furnished to the Administrative
Agent a copy of, projected consolidated balance sheets and statements of income
and cash flows of the Parent and its Subsidiaries (consisting of balance sheets
and statements of income and cash flows prepared by the Borrowers as of the
last day of the fiscal quarter most recently ended prior to Closing and then on
a quarterly basis for the first four fiscal quarters following Closing and
thereafter on an annual basis) through the end of fiscal year 2010, giving
effect to the repayment of the Existing Senior Credit Facilities, the Bridge
Credit Facility and the Senior Unsecured Notes, the initial extensions of
credit made under this Agreement and the payment of transaction fees and
expenses related to the foregoing (the “Projections”). In the good faith
opinion of management of the Borrowers, the assumptions used in the preparation
of the Projections were fair, complete and reasonable when made and continue to
be fair, complete and reasonable as of the Closing Date. The Projections have
been prepared in good faith by the executive and financial personnel of the
Borrowers, are complete and represent a reasonable


 


57





















 


estimate of the
future performance and financial condition of the Parent and its Subsidiaries,
subject to the uncertainties and approximations inherent in any projections, it
being understood that there can be no assurance that the results therein will
be achieved.


 


(d)                                 Both before
and after giving effect to the making of the initial loans hereunder, each
Credit Party (i) has capital sufficient to carry on its businesses as
conducted and as proposed to be conducted, (ii) has assets with a fair
saleable value, determined on a going concern basis, which are (y) not less
than the amount required to pay the probable liability on its existing debts as
they become absolute and matured and (z) greater than the total amount of its
liabilities (including identified contingent liabilities, valued at the amount
that can reasonably be expected to become absolute and matured in their
ordinary course), and (iii) does not intend to, and does not believe that
it will, incur debts or liabilities beyond its ability to pay such debts and
liabilities as they mature in their ordinary course.


 


5.12                           Ownership of
Properties. Each Credit Party has good title to, or valid
leasehold interests in, all its real and personal property material to its
business, in each case free and clear of all Liens other than Permitted Liens
and minor defects in title that do not interfere with its ability to conduct
its business as currently conducted or to utilize such properties for their
intended purposes.


 


5.13                           ERISA.


 


(a)                                  Each Credit
Party and its ERISA Affiliates is in compliance with the applicable provisions
of ERISA, and each Plan is and has been administered in compliance with all
applicable Requirements of Law, including, without limitation, the applicable
provisions of ERISA and the Code, in each case except where the failure so to
comply, individually or in the aggregate, could not reasonably be expected to
have a Material Adverse Effect. No ERISA Event (i) has occurred within the
five (5) year period prior to the Closing Date, (ii) has occurred and
is continuing, or (iii) to the knowledge of the Borrowers, is reasonably
expected to occur with respect to any Plan, which, in each case, could
reasonably be expected to have a Material Adverse Effect. No Plan has any
Unfunded Pension Liability as of the most recent annual valuation date
applicable thereto in an aggregate amount that could not reasonably be expected
to have a Material Adverse Effect (and as of the most recent annual valuation
date applicable thereto prior to Closing Date, no Plan had any Unfunded Pension
Liability). No Credit Party or any of its ERISA Affiliates has engaged in a
transaction that could be subject to Section 4069 or 4212(c) of
ERISA.


 


(b)                                 No Credit
Party or any of its ERISA Affiliates has any outstanding liability on account
of a complete or partial withdrawal from any Multiemployer Plan, and no Credit
Party or any of its ERISA Affiliates would become subject to any liability
under ERISA if any such Credit Party or ERISA Affiliate were to withdraw
completely from all Multiemployer Plans as of the most recent valuation date,
in each case that could reasonably be expected to have a Material Adverse
Effect. No Multiemployer Plan is in “reorganization” or is “insolvent” within
the meaning of such terms under ERISA.


 


5.14                           Environmental
Matters. Except as, individually or in the aggregate, could not
reasonably be expected to have a Material Adverse Effect:


 


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(a)                                  No Hazardous Substances are or have been
generated, used, located, released, treated, transported, disposed of or
stored, currently or in the past, (i) by the Parent or any of its
Subsidiaries or (ii) to the knowledge of the Borrowers, by any other
Person (including any predecessor in interest) or otherwise, in either case in,
on, about or to or from any portion of any real property, leased, owned or
operated by the Parent and its Subsidiaries, except in compliance with all
applicable Environmental Laws; no portion of any such real property or, to the
knowledge of the Borrowers, any other real property at any time leased, owned
or operated by the Parent or its Subsidiaries is contaminated by any Hazardous
Substance; and no portion of any real property leased, owned or operated by the
Parent or its Subsidiaries is presently or, to the knowledge of the Borrowers,
has ever been, the subject of an environmental audit, assessment or remedial
action.


 


(b)                                 No portion of any real property leased, owned
or operated by the Parent or its Subsidiaries has been used by the Parent or
its Subsidiaries or, to the knowledge of the Borrowers, by any other Person, as
or for a mine, landfill, dump or other disposal facility, gasoline service
station or bulk petroleum products storage facility; and no portion of such
real property or any other real property currently or at any time in the past
leased, owned or operated by the Parent or its Subsidiaries has, pursuant to
any Environmental Law, been placed on the “National Priorities List” or “CERCLIS
List” (or any similar federal, state or local list) of sites subject to
possible environmental problems.


 


(c)                                  All activities and operations of the Parent
and its Subsidiaries are in compliance with the requirements of all applicable
Environmental Laws; the Parent and its Subsidiaries have obtained all licenses
and permits under Environmental Laws necessary to its respective operations,
all such licenses and permits are being maintained in good standing, and each
of the Parent and its Subsidiaries is in compliance with all terms and
conditions of such licenses and permits; and neither the Parent nor any of its
Subsidiaries is involved in any suit, action or proceeding, or has received any
notice, complaint or other request for information from any Governmental
Authority or other Person, with respect to any actual or alleged Environmental
Claims, and to the knowledge of the Borrowers, there are no threatened
Environmental Claims, nor any basis therefore.


 


5.15                           Compliance with Laws. Each of the Parent and its Subsidiaries has
timely filed all material reports, documents and other materials required to be
filed by it under all applicable Requirements of Law with any Governmental
Authority, has retained all material records and documents required to be
retained by it under all applicable Requirements of Law, and is otherwise in
compliance with all applicable Requirements of Law in respect of the conduct of
its business and the ownership and operation of its properties, except in each
case to the extent that the failure to comply therewith, individually or in the
aggregate, could not reasonably be expected to have a Material Adverse Effect.


 


5.16                           Intellectual Property. Each Credit Party owns, or has the legal
right to use, all Intellectual Property necessary for it to conduct its
business as currently conducted. No claim has been asserted or is pending by
any Person challenging or questioning the use of any such Intellectual Property
or the validity or effectiveness of any such Intellectual Property, nor do the
Borrowers know of any such claim, and to the knowledge of the Borrowers, the
use of such Intellectual Property by any Credit Party does not infringe on the
known rights of any Person,


 


59





















 


except for such claims and infringements that,
individually or in the aggregate, could not reasonably be expected to have a
Material Adverse Effect.


 


5.17                           Regulated
Industries. None of the Parent and its Subsidiaries is (i) an
“investment company,” a company “controlled” by an “investment company,” or an “investment
advisor,” within the meaning of the Investment Parent Act of 1940, as amended,
or (ii) a “holding company,” a “subsidiary company” of a “holding company,”
or an “affiliate” of a “holding company” or of a “subsidiary company” of a “holding
company,” within the meaning of the Public Utility Holding Parent Act of 1935,
as amended.


 


5.18                           Insurance. The
assets, properties and business of the Credit Parties are insured against such
hazards and liabilities, under such coverages and in such amounts, as are
customarily maintained by prudent companies similarly situated and under
policies issued by insurers of recognized responsibility.


 


5.19                           Material
Contracts. Schedule 5.19 lists, as of the Closing Date, each “material
contract” (within the meaning of Item 601(b)(10) of
Regulation S-K under the Securities Act) to which any Credit Party is a party,
by which any Credit Party or its properties is bound or to which any Credit
Party is subject (collectively, “Material Contracts”), and also
indicates the parties thereto. As of the Closing Date, (i) each Material
Contract is in full force and effect and is enforceable by each Credit Party
that is a party thereto in accordance with its terms, except as enforceability
may be limited by bankruptcy, insolvency, reorganization, moratorium or other
similar laws affecting creditors’ rights generally, by general or equitable
principles or by principles of good faith and fair dealing, and (ii) no
Credit Party or, to the knowledge of the Borrowers, any other party thereto is
in breach of or default under any Material Contract in any material respect or
has given notice of termination or cancellation of any Material Contract.


 


5.20                           No
Burdensome Restrictions. No Credit Party is a party to any
written agreement or instrument or subject to any other obligations or any
charter or corporate restriction or any provision of any applicable Requirement
of Law that, individually or in the aggregate, could reasonably be expected to
have a Material Adverse Effect.


 


5.21                           OFAC;
Anti-Terrorism Laws.


 


(a)                                  None of the
Parent or its Subsidiaries nor any Affiliate of the Parent and its Subsidiaries
(i) is a Sanctioned Person, (ii) has more than 15% of
its assets in Sanctioned Countries, or (iii) derives more than 15% of its
operating income from investments in, or transactions with, Sanctioned Persons
or Sanctioned Countries. No part of the proceeds of any Loan hereunder will be
used directly or indirectly to fund any operations in, finance any investments
or activities in or make any payments to, a Sanctioned Person or a Sanctioned
Country.


 


(b)                                 Neither the
making of the Loans hereunder nor the use of the proceeds thereof will violate
the PATRIOT Act, the Trading with the Enemy Act, as amended, or any of the
foreign assets control regulations of the United States Treasury
Department (31 CFR,
Subtitle B, Chapter V, as amended) or any enabling legislation or executive
order relating thereto. The Parent and its Subsidiaries are in compliance in
all material respects with the PATRIOT Act.


 


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ARTICLE VI


 


AFFIRMATIVE
COVENANTS


 


Each of the Borrowers covenants and agrees that, until
the termination of the Revolving Credit Commitments, the termination or
expiration of all Letters of Credit and the payment in full in cash of all
principal and interest with respect to the Loans and all Reimbursement
Obligations together with all fees, expenses and other amounts then due and
owing hereunder:


 


6.1                                 Financial
Statements. The Borrowers will deliver to the Administrative
Agent and to each Lender:


 


(a)                                  As soon as
available and in any event within forty-five (45) days (or, if earlier and if
applicable to the Borrowers, the quarterly report deadline under the Exchange
Act rules and regulations) after the end of each of the first three fiscal
quarters of each fiscal year, beginning with the fiscal quarter ending July 31,
2005, an unaudited consolidated balance sheet of the Parent and its
Subsidiaries as of the end of such fiscal quarter, unaudited consolidated
statements of income for the Parent and its Subsidiaries for the fiscal quarter
then ended and unaudited consolidated statements of income and cash flows for
that portion of the fiscal year then ended, in each case setting forth
comparative consolidated figures as of the end of and for the corresponding
period in the preceding fiscal year, all in reasonable detail and prepared in
accordance with GAAP (subject to the absence of notes required by GAAP and
subject to normal year-end adjustments) applied on a basis consistent with that
of the preceding quarter or containing disclosure of the effect on the financial
condition or results of operations of any change in the application of
accounting principles and practices during such quarter; provided, that
electronic delivery to the Administrative Agent within the time period
specified above of copies of the Parent’s Quarterly Report on Form 10-Q
prepared in accordance with the requirements therefor and filed with the United
States Securities and Exchange Commission shall be deemed to satisfy the
requirements of this Section 6.1(a); and


 


(b)                                 As soon as
available and in any event within ninety (90) days (or, if earlier and if
applicable to the Borrowers, the annual report deadline under the Exchange Act rules and
regulations) after the end of each fiscal year, beginning with fiscal year
2005, an audited consolidated balance sheet of the Parent and its Subsidiaries
as of the end of such fiscal year and the related audited consolidated
statements of income, cash flows and stockholders’ equity for the Parent and
its Subsidiaries for the fiscal year then ended, including the notes thereto,
in each case setting forth comparative consolidated figures as of the end of
and for the preceding fiscal year, all in reasonable detail and (with respect
to the audited statements) certified by the independent certified public
accounting firm regularly retained by the Parent or another Independent
certified public accounting firm of recognized national standing reasonably
acceptable to the Administrative Agent, together with a report thereon by such
accountants that is not qualified as to going concern or scope of audit and to
the effect that such financial statements present fairly in all material
respects the consolidated financial condition and results of operations of the
Parent and its Subsidiaries as of the dates and for the periods indicated in
accordance with GAAP applied on a basis consistent with that of the preceding
year or containing disclosure of the effect on the financial condition or
results of operations of any change in the application of accounting principles
and practices during such year; provided, that 


 


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electronic
delivery to the Administrative Agent within the time period specified above of
copies of the Parent’s Annual Report on Form 10-K for such fiscal year prepared
in accordance with the requirements therefor and filed with the United States
Securities and Exchange Commission shall be deemed to satisfy the requirements
of this Section 6.1(b).


 


6.2                                 Other
Business and Financial Information. The Borrowers will deliver to the
Administrative Agent and each Lender:


 


(a)                                  Concurrently
with each delivery of the financial statements described in Sections 6.l(a) and 6.1(b), beginning with delivery of such financial
statements for the fiscal quarter ending July 31, 2005, a Compliance
Certificate with respect to the period covered by the financial statements
being delivered thereunder, executed by a Financial Officer of each Borrower,
together with a Covenant Compliance Worksheet reflecting the computation of the
financial covenants set forth in ARTICLE VII as
of the last day of the period covered by such financial statements;


 


(b)                                 As soon as
available and in any event within ninety (90) days after the commencement of
each fiscal year, beginning with the 2007 fiscal year, a consolidated operating
budget for the Parent and its Subsidiaries for such fiscal year and the four (4) succeeding
years (prepared on a quarterly basis for the first four fiscal quarters and
thereafter on an annual basis), consisting of consolidated balance sheets and
consolidated statements of income and cash flows in substantially the form of
the Projections provided by the Parent and its Subsidiaries pursuant to Section 4.1(j), together with a certificate of a Financial Officer of the Parent
to the effect that such budget has been prepared in good faith and is a
reasonable estimate of the financial position and results of operations of the
Parent and its Subsidiaries for the period covered thereby;


 


(c)                                  Promptly
upon receipt thereof, copies of any “management letter’’ submitted to any
Credit Party by its certified public accountants in connection with each
annual, interim or special audit to the extent not prohibited by the applicable
accountants (and the Borrowers agree to use commercially reasonable efforts to
obtain the consent of any such accountant to the disclosure of any such
management letter), and promptly upon completion thereof, any response reports
from such Credit Party in respect thereof;


 


(d)                                 Promptly
upon the sending, filing or receipt thereof, electronic copies of (i) all
financial statements, reports, notices and proxy statements that any Credit
Party shall send or make available generally to its shareholders, and (ii) all
regular, periodic and special reports, registration statements and prospectuses
(other than on Form S-8) that any Credit Party shall render to or file
with the Securities and Exchange Commission, the National Association of
Securities Dealers, Inc. or any national securities exchange;


 


(e)                                  Promptly
upon closing thereof, notice of consummation of any Permitted Acquisition
involving total consideration (including, without limitation, the issuance of
Capital Stock) equal to or greater than $2,000,000;


 


(f)                                    Promptly
upon (and in any event within five (5) Business Days after) any
Responsible Officer of any Credit Party obtaining knowledge thereof, written
notice of any of the following (provided, that electronic delivery to
the Administrative Agent within the time 


 


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period
specified above of copies of a Current Report of the Parent on Form 8-K
prepared in accordance with the requirements therefor regarding any of the
items set forth in clauses (ii) and
(iii) below shall be deemed
to satisfy the requirements of this Section 6.2(f) with respect to such items):


 


(i)                                     the
occurrence of any Default or Event of Default, together with a written
statement of a Responsible Officer of the Borrowers specifying the nature of
such Default or Event of Default, the period of existence thereof and the
action that the Borrowers have taken and proposes to take with respect thereto;


 


(ii)                                  the
institution or threatened institution of any action, suit, investigation or
proceeding against or affecting the Parent or any of its Subsidiaries,
including any such investigation or proceeding by any Governmental Authority
(other than routine periodic inquiries, investigations or reviews), that, if
adversely determined, could reasonably be expected, individually or in the
aggregate, to have a Material Adverse Effect, and any material development in
any litigation or other proceeding previously reported pursuant to Section 5.5 or
this Section 6.2(f)(ii);


 


(iii)                               the receipt
by the Parent or any of its Subsidiaries from any Governmental Authority of (A) any
notice asserting any failure by any such party to be in compliance with
applicable Requirements of Law or that threatens the taking of any action
against any such party or sets forth circumstances that, if taken or adversely
determined, could reasonably be expected to have a Material Adverse Effect, or (B) any
notice of any actual or threatened suspension, limitation or revocation of,
failure to renew, or imposition of any restraining order, escrow or impoundment
of funds in connection with, any license, permit, accreditation or
authorization of the Parent or its Subsidiaries, where such action could
reasonably be expected to have a Material Adverse Effect; 


 


(iv)                              any other
matter or event that has, or could reasonably be expected to have, a material
adverse effect on (x) the ability of the Parent and its Subsidiaries, taken as
a whole, to perform their obligations under this Agreement or any of the other
Credit Documents, or (y) the legality, validity or enforceability of this
Agreement or any of the other Credit Documents or the rights and remedies of
the Administrative Agent and the Lenders hereunder or thereunder, together with
a written statement of a Responsible Officer of a Borrower setting forth the
nature and period of existence thereof and the action that the affected Credit
Parties have taken and propose to take with respect thereto;


 


(g)                                 promptly upon the
closing thereof, notice of the consummation of the sale of all or substantially
all of the assets or of the Capital Stock of Hewfant; and


 


(h)                                 As promptly
as reasonably possible, such other information about the business, condition
(financial or otherwise), operations or properties of the Parent and its
Subsidiaries as the Administrative Agent or any Lender may from time to time
reasonably request.


 


6.3                                 Existence;
Franchises; Maintenance of Properties. Each of the
Borrowers will, and will cause each of its Subsidiaries to, (i) maintain
and preserve in full force and effect its legal existence, except as expressly
permitted otherwise by Section 8.1, (ii) obtain, maintain and 


 


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preserve
in full force and effect all other rights, franchises, licenses, permits,
certifications, approvals and authorizations required by Governmental
Authorities and necessary to the ownership, occupation or use of its properties
or the conduct of its business, except to the extent the failure to do so could
not reasonably be expected to have a Material Adverse Effect, and (iii) keep
all material properties in good working order and condition (normal wear and
tear and damage by casualty excepted).


 


6.4                                 Compliance
with Laws. Each of the Borrowers will, and will cause each of
its Subsidiaries to, comply in all respects with all Requirements of Law
applicable in respect of the conduct of its business and the ownership and
operation of its properties, except to the extent the failure so to comply
could not reasonably be expected to have a Material Adverse Effect.


 


6.5                                 Payment of
Obligations. Each of the Borrowers will. and will, cause each of
its Subsidiaries to, (i) pay, discharge or otherwise satisfy at or before
maturity all liabilities and obligations as and when due (subject to any
applicable subordination, grace and notice provisions), except to the extent
failure to do so could not reasonably be expected to have a Material Adverse
Effect, and (ii) pay and discharge all taxes, assessments and governmental
charges or levies imposed upon it, upon its income or profits or upon any of
its properties, prior to the date on which penalties would attach thereto, and
all lawful claims that, if unpaid, would become a Lien (other than a Permitted
Lien) upon any of the properties of any Credit Party; provided, however,
that no Credit Party shall be required to pay any such tax, assessment, charge,
levy or claim that is being contested in good faith and by proper proceedings
and as to which such Credit Party is maintaining adequate reserves with respect
thereto in accordance with GAAP.


 


6.6                                 Insurance. Each of
the Borrowers will, and will cause each of its Subsidiaries to, maintain with
financially sound and reputable insurance companies insurance with respect to
its assets, properties and business, against such hazards and liabilities, of
such types and in such amounts, as is customarily maintained by companies in
the same or similar businesses similarly situated.


 


6.7                                 Maintenance
of Books and Records; Inspection. Each of the Borrowers will, and
will cause each of its Subsidiaries to, (i) maintain adequate books,
accounts and records, in which full, true and correct entries shall be made of
all financial transactions in relation to its business and properties, and
prepare all financial statements required under this Agreement, in each case in
accordance with GAAP and in compliance with the requirements of any
Governmental Authority having jurisdiction over it, and (ii) permit
employees or agents of the Administrative Agent, and during the occurrence and
continuation of an Event of Default, any Lender to visit and inspect its
properties and examine or audit its books, records, working papers and accounts
and make copies and memoranda of them, and to discuss its affairs, finances and
accounts with its officers and employees and, upon notice to the Borrowers, the
independent public accountants of the Parent and its Subsidiaries (and by this
provision the Borrowers authorize such accountants to discuss the finances and
affairs of the Parent and its Subsidiaries), all at such times and from time to
time, upon reasonable notice and during business hours, as may be reasonably
requested.


 


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6.8                                 Material
Subsidiaries. Promptly (and in any event within ten (10) Business
Days after) the (i) creation or direct or indirect acquisition of any new
Material Subsidiary or (ii) delivery of financial statements under Section 6.1 that indicate that a Subsidiary of
the Parent (not another Borrower) not at such time a Guarantor is a Material
Subsidiary, the Borrowers shall do the following:


 


(a)                                  Cause such
new Material Subsidiary to execute and deliver to the Administrative Agent the
Guaranty or a joinder thereto, pursuant to which such new Material Subsidiary
shall become a guarantor thereunder and shall guarantee the payment in full of
the Obligations of the Borrowers under this Agreement and the other Credit
Documents;


 


(b)                                 Deliver to
the Administrative Agent:


 


(i)                                     a written
legal opinion of counsel to such Subsidiary addressed to the Administrative
Agent and the Lenders, in form and substance reasonably satisfactory to the
Administrative Agent and its counsel, which shall cover such matters relating
to such Subsidiary and the creation or acquisition thereof incident to the
transactions contemplated by this Agreement and this Section 6.8 and the other Credit Documents
as set forth in the legal opinion of counsel delivered to the Administrative
Agent and the Lenders on the Closing Date;


 


(ii)                                  (A) a
copy of the certificate of incorporation (or other charter documents) of such
Subsidiary, certified as of a date that is acceptable to the Administrative
Agent by the applicable Governmental Authority of the jurisdiction of
incorporation or organization of such Subsidiary, (B) a copy of the bylaws
or similar organizational document of such Subsidiary, certified on behalf of
such Subsidiary as of a date that is acceptable to the Administrative Agent by
the corporate secretary or assistant secretary of such Subsidiary, (C) an
original certificate of good standing for such Subsidiary issued by the
applicable Governmental Authority of the jurisdiction of incorporation or
organization of such Subsidiary and (D) copies of the resolutions of the
board of directors and, if required, stockholders or other equity owners of
such Subsidiary authorizing the execution, delivery and performance of the
agreements, documents and instruments executed pursuant to Sections 6.8(a), certified on behalf of such Subsidiary by an Authorized Officer
of such Subsidiary, all in form and substance reasonably satisfactory to the
Administrative Agent; and


 


(iii)                               a certificate
of the secretary or an assistant secretary of such Subsidiary as to the
incumbency and signature of the officers executing agreements, documents and
instruments executed pursuant to Sections 6.8(a);


 


provided that, with
respect to any Foreign Subsidiary, such Foreign Subsidiary will not be required
to become a Guarantor if doing so would cause any materially adverse tax
consequences to the Borrowers.


 


6.9                                 Environmental
Laws. Each of the Borrowers will, and will cause each of its
Subsidiaries to comply in all material respects with all applicable
Environmental Laws, except to 


 


65





















 


the extent that the
failure to do so could not reasonably be expected to have a Material Adverse
Effect.


 


6.10                           OFAC,
PATRIOT Act Compliance. Each of the Borrowers will, and
will cause each of its Subsidiaries to, (i) refrain from doing business in
a Sanctioned Country or with a Sanctioned Person in violation of the economic
sanctions of the United States administered by OFAC, and (ii) provide, to
the extent commercially reasonable, such information and take such actions as
are reasonably requested by the Administrative Agent or any Lender in order to
assist the Administrative Agent and the Lenders in maintaining compliance with
the PATRIOT Act.


 


6.11                           Further
Assurances. Each of the Borrowers will, and will cause each of
its Subsidiaries to, make, execute, endorse, acknowledge and deliver any
amendments, modifications or supplements hereto and restatements hereof and any
other agreements, instruments or documents, and take any and all such other
actions, as may from time to time be reasonably requested by the Administrative
Agent or the Required Lenders to effect, confirm or further assure or protect
and preserve the interests, rights and remedies of the Administrative Agent and
the Lenders under this Agreement and the other Credit Documents.


 


ARTICLE VII


 


FINANCIAL COVENANTS


 


Each of the Borrowers covenants and agrees that, until
the termination of the Revolving Credit Commitments, the termination or
expiration of all Letters of Credit and the payment in full in cash of all
principal and interest with respect to the Loans and all Reimbursement
Obligations together with all fees, expenses and other amounts then due and
owing hereunder:


 


7.1                                 Leverage
Ratio. The Borrowers will not permit the Leverage Ratio as of the
last day of any fiscal quarter, beginning with the fiscal quarter ending July 31,
2005, to be greater than 2.5:l.0.


 


7.2                                 Interest
Coverage Ratio. The Borrowers will not permit the
Interest Coverage Ratio as of the last day of any fiscal quarter, beginning
with the fiscal quarter ending July 31, 2005, to be less than 4.0:l.0.


 


ARTICLE VIII


 


NEGATIVE COVENANTS


 


Each of the Borrowers covenants and agrees that, until
the termination of the Revolving Credit Commitments, the termination or
expiration of all Letters of Credit and the payment in full in cash of all
principal and interest with respect to the Loans and all Reimbursement
Obligations together with all fees, expenses and other amounts then due and
owing hereunder:


 


8.1                                 Fundamental
Changes. Each of the Borrowers will not, and will not permit or
cause any of its Subsidiaries to, liquidate, wind up or dissolve, or enter into
any consolidation, merger or other combination, or sell, assign, lease, convey,
transfer or otherwise dispose 


 


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(whether in one or a series of transactions) of all or any of
its assets, business or other properties (including Capital Stock of
Subsidiaries), or agree to do any of the foregoing; provided, however,
that:


 


(i)                                     any
Subsidiary of a Borrower may merge or consolidate with, or be liquidated into,
(x) a Borrower (so long as such Borrower is the surviving or continuing entity)
or (y) so long as such merging or liquidating Subsidiary is not a Borrower, any
other Subsidiary (so long as, if either constituent entity is a Guarantor, the
surviving or continuing entity is a Guarantor), and in each case so long as no
Default or Event of Default has occurred and is continuing or would result
therefrom;


 


(ii)                                  any
Subsidiary of a Borrower may merge or consolidate with another Person (other
than another Credit Party), so long as (x) the surviving entity is a Guarantor,
(y) such merger or consolidation constitutes a Permitted Acquisition and the
applicable conditions and requirements of Section 6.8 are satisfied, and (z) no Default or
Event of Default has occurred and is continuing or would result therefrom;


 


(iii)                               a Borrower
may merge or consolidate with another Person (other than another Credit Party),
so long as (x) such Borrower is the surviving entity, (y) such merger or
consolidation constitutes a Permitted Acquisition and the applicable conditions
and requirements of Section 6.8 are satisfied, and (z) no Default or
Event of Default has occurred and is continuing or would result therefrom;


 


(iv)                              any Borrower
or its Subsidiaries may engage in the sale or other disposition of inventory
and Cash Equivalents in the ordinary course of business, the sale of accounts
receivable (including receivables related to Franchisee Expansions), and the
termination or unwinding of Hedge Agreements permitted hereunder;


 


(v)                                 any Borrower
or its Subsidiaries may engage in the sale, exchange, or other disposition in
the ordinary course of business of equipment or other capital assets that are
obsolete or no longer necessary for the operations of such Borrower or
Subsidiary;


 


(vi)                              any Borrower
or its Subsidiaries may engage in the sale, lease or other disposition of
assets by such Borrower or Subsidiary to a Borrower or to a Guarantor (or by
any Subsidiary that is not a Guarantor to another Subsidiary that is not a
Guarantor), in each case so long as no Event of Default shall have occurred and
be continuing or would result therefrom; and


 


(vii)                           the
Borrowers may sell up to twenty percent (20%) of Consolidated Total Assets as
determined as of the date of the most recent financial statements required to
be provided hereunder, which may include the sale of all or substantially all
of the assets (or Capital Stock) of Hewfant.


 


8.2                                 Liens. Each of
the Borrowers will not, and will not permit or cause any of its Subsidiaries
to, directly or indirectly, make, create, incur, assume or suffer to exist, any
Lien upon or with respect to any part of its property or assets, whether now
owned or hereafter acquired, or file or authorize the filing of, or permit to
remain in effect, any financing statement 


 


67





















 


or
other similar notice of any Lien with respect to any such property, asset,
income or profits under the Uniform Commercial Code of any state or under any
similar recording or notice statute, or agree to do any of the foregoing, other
than the following (collectively, “Permitted Liens”):


 


(i)                                     Liens in
favor of the Administrative Agent and the Lenders created by or otherwise
existing under or in connection with this Agreement and the other Credit
Documents;


 


(ii)                                  Liens in
existence on the Closing Date and set forth on Schedule 8.2,
and any extensions, renewals or replacements thereof; provided that any
such extension, renewal or replacement Lien shall be limited to all or a part
of the property that secured the Lien so extended, renewed or replaced (plus
any improvements on such property) and shall secure only those obligations that
it secures on the date hereof (and any renewals, replacements, refinancings or
extensions of such obligations that do not increase the outstanding principal
amount thereof);


 


(iii)                               Liens
imposed by law or by contract, such as Liens of carriers, warehousemen,
mechanics, materialmen and landlords, incurred in the ordinary course of
business for sums not constituting borrowed money that are not overdue for a
period of more than sixty (60) days or that are being contested in good faith by
appropriate proceedings and for which adequate reserves have been established
in accordance with GAAP (if so required);


 


(iv)                              Liens (other
than any Lien imposed by ERISA, the creation or incurrence of which would
result in an Event of Default under Section 9.1(j))
incurred in the ordinary course of business in connection with state, local or
federal regulations applicable to tax preparers, worker’s compensation,
unemployment insurance or other forms of governmental insurance or benefits, or
to secure the performance of letters of credit, bids, tenders, statutory
obligations, surety and appeal bonds, leases, public or statutory obligations,
government contracts and other similar obligations (other than obligations for
borrowed money) entered into in the ordinary course of business;


 


(v)                                 Liens for
taxes, assessments or other governmental charges or statutory obligations that
are not delinquent or remain payable without any penalty or that are being
contested in good faith by appropriate proceedings and for which adequate
reserves have been established in accordance with GAAP (if so required);


 


(vi)                              any attachment
or judgment Lien not constituting an Event of Default under Section 9.1(h);


 


(vii)                           customary
rights of set-off, revocation, refund or chargeback under deposit agreements or
under the Uniform Commercial Code of banks or other financial institutions
where the Borrowers or any of their Subsidiaries maintains deposits (other than
deposits intended as cash collateral) in the ordinary course of business;


 


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(viii)                        Liens that
arise in favor of banks under Article 4 of the Uniform Commercial Code on
items in collection and the documents relating thereto and proceeds thereof;


 


(ix)                                Liens
arising from the filing (for notice purposes only) of UCC-1 financing
statements (or equivalent filings, registrations or agreements in foreign
jurisdictions) in respect of true leases otherwise permitted hereunder;


 


(x)                                   with respect
to any real property occupied by the Borrowers or any of their Subsidiaries, (a) all
easements, rights of way, reservations, licenses, encroachments, variations and
similar restrictions, charges and encumbrances on title that do not secure
monetary obligations and do not materially impair the use of such property for
its intended purposes or the value thereof, and (b) any other Lien or
exception to coverage described in mortgagee policies of title insurance issued
in favor of and accepted by the Administrative Agent;


 


(xi)                                any leases,
subleases, licenses or sublicenses granted by the Borrowers or any of their
Subsidiaries to third parties in the ordinary course of business and not
interfering in any material respect with the business of the Borrowers and
their Subsidiaries, and any interest or title of a lessor, sublessor, licensor
or sublicensor under any lease or license permitted under this Agreement;


 


(xii)                             Liens
securing the purchase money Indebtedness or Capital Lease Obligations incurred
for assets acquired, constructed or improved by the Borrowers or a Subsidiary
of the Borrowers, provided that (x) any such Lien shall attach to the
property being acquired, constructed or improved with such Indebtedness
concurrently with or within ninety (90) days after the acquisition (or
completion of construction or improvement) or the refinancing thereof by the
Borrowers or such Subsidiary, (y) the amount of the Indebtedness secured by
such Lien shall not exceed the cost to the Borrowers or such Subsidiary of
acquiring, constructing or improving the property and any other assets then
being financed solely by the same financing source, and (z) any such Lien shall
not encumber any other property of the Borrowers or any of their Subsidiaries
except assets then being financed solely by the same financing source; and


 


(xiii)                          other Liens
securing obligations of the Borrowers and their Subsidiaries not exceeding
twenty percent (20%) of Consolidated Net Tangible Assets in aggregate principal
amount outstanding at any time.


 


8.3                                 Investments. Each of
the Borrowers will not, and will not permit or cause any of its Subsidiaries
to, directly or indirectly, purchase, own, invest in or otherwise acquire any
Capital Stock, evidence of indebtedness or other obligation or security or any
interest whatsoever in any other Person, or make or permit to exist any loans,
advances or extensions of credit to, or any investment in cash or by delivery
of property in, any other Person, or make any Acquisition, or create or acquire
any Subsidiary, or become a partner or joint venturer in any partnership or
joint venture (collectively, “Investments”), or make a commitment or
otherwise agree to do any of the foregoing, other than:


 


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(i)                                     Investments
consisting of Cash Equivalents;


 


(ii)                                  Investments
consisting of the extension of trade credit, the creation of prepaid expenses,
and the purchase of inventory, supplies, equipment and other assets, in each
case by the Borrowers and their Subsidiaries in the ordinary course of
business;


 


(iii)                               Investments
(including equity securities and debt obligations) of the Borrowers and their
Subsidiaries received in connection with the bankruptcy or reorganization of
suppliers and customers and in good faith settlement of delinquent obligations
of, and other disputes with, customers and suppliers arising in the ordinary
course of business;


 


(iv)                              without
duplication, Investments consisting of intercompany Indebtedness;


 


(v)                                 Investments
existing as of the Closing Date or required to be made pursuant to contractual
obligations in existence on the Closing Date and described in Schedule 8.3, and any extensions or renewals thereof;


 


(vi)                              Investments
of a Borrower under Hedge Agreements entered into in the ordinary course of
business to manage existing or anticipated interest rate or foreign currency
risks or equity risks related to share repurchases or employee compensation
plans and not for speculative purposes;


 


(vii)                           Investments
of any Borrower in its Subsidiaries, in each case to the extent made prior to
the Closing Date;


 


(viii)                        Investments
(other than Acquisitions) consisting of the making of capital contributions or
the purchase of Capital Stock (x) by a Borrower or any Subsidiary of a Borrower
in any other Subsidiary that (1) is a Guarantor immediately prior to, (2) will
be a Guarantor immediately after giving effect to, such Investment, or (3) is
not a Material Subsidiary, and (y) by any Subsidiary in a Borrower;


 


(ix)                                Permitted
Acquisitions; provided, that consummation of any such acquisition shall
be deemed to be a representation to the Administrative Agent and the Lenders by
the Borrowers that the conditions set forth in the definition of Permitted
Acquisition have been satisfied;


 


(x)                                   Investments
in connection with pledges, deposits, payments or performance bonds made or
given in the ordinary course of business in connection with or to secure lease
payments, statutory, regulatory or similar obligations including, without
limitation, obligations under insurance, health, disability, safety, or
environmental obligations or under local, state or federal laws or regulations
related to tax preparers;


 


(xi)                                Franchisee
Expansions and Franchisee Advance Payments;


 


(xii)                             Guaranty
Obligations of a Borrower or a Subsidiary of a Borrower with respect to another
Borrower or Subsidiary of a Borrower;


 


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(xiii)                          Investments
received as part of a redemption or payment of or for, as a dividend on, or as
a distribution in respect of, other Investments permitted by this Section; and


 


(xiv)                         other Investments
of the Borrowers and their Subsidiaries not otherwise permitted under this Section 8.3 (including other
Investments in Franchisees and joint ventures, but excluding Investments in
Foreign Subsidiaries) in an aggregate amount not exceeding $25,000,000 at any time outstanding
for all such Investments.


 


8.4                                 Restricted
Payments. Each of the Borrowers will not, and will not permit or
cause any of its Subsidiaries to, directly or indirectly, declare or make any
dividend payment, or make any other distribution of cash, property or assets,
in respect of any of its Capital Stock or any warrants, rights or options to
acquire its Capital Stock, or purchase, redeem, retire or otherwise acquire for
value any shares of its Capital Stock or any warrants, rights or options to
acquire its Capital Stock, or set aside funds for any of the foregoing, except
that:


 


(i)                                     the Borrowers
and any of their Subsidiaries may declare and make dividend payments or other
distributions payable solely in its Common Stock;


 


(ii)                                  each Subsidiary
of the Borrowers may declare and make dividend payments or other distributions
on a pro rata basis, in each case to the extent not prohibited under applicable
Requirements of Law;


 


(iii)                               the Parent
may make payments pursuant to and in accordance with stock option plans or
other benefit plans for management or employees of the Parent and its
Subsidiaries; and


 


(iv)                              so long as
no Default or Event of Default shall have occurred and be continuing or would
result therefrom, the Parent may declare and make dividend payments and other
distributions or purchase, redeem, retire or otherwise acquire shares of its
Capital Stock (or options or rights to acquire its Capital Stock) as long as
(x) after giving effect to such dividend, distribution, purchase, redemption,
retirement or other acquisition of Capital Stock, the Borrowers shall be in
compliance with the financial covenants contained in ARTICLE VII,
such compliance determined with regard to calculations made on a Pro Forma
Basis for the Reference Period then most recently ended for which the
Administrative Agent has received the financial statements required by Section 6.1
and (y) with respect to purchases, redemptions, retirement or other
acquisitions of Capital Stock only, the Borrowers shall have availability under
the Revolving Credit Commitments of at least $10,000,000, calculated on a Pro Forma Basis for the Reference
Period then most recently ended for which the Administrative Agent has received
the financial statements required by Section 6.1
(and provided, that consummation of any such transaction
contemplated by this Section 8.4(iii) shall
be deemed to be a representation to the Administrative Agent and the Lenders by
the Borrowers that the conditions set forth in this paragraph have been satisfied).


 


8.5                                 Transactions
with Affiliates. Each of the Borrowers will not, and
will not permit or cause any of its Subsidiaries to, enter into any transaction
(including, without limitation, any 


 


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purchase,
sale, lease or exchange of property or the rendering of any service) with any
officer or director, stockholder or other Affiliate of the Borrowers or any of
their Subsidiaries, except upon fair and reasonable terms that are no less
favorable to it than it would be obtained in a comparable arm’s length
transaction with a Person other than an Affiliate of the Borrowers or any of
their Subsidiaries; provided, however, that nothing contained in
this Section 8.5 shall prohibit:


 


(i)                                     transactions described on
Schedule 8.5 (and any renewals or
replacements thereof on terms not materially more disadvantageous to the
applicable Credit Party) or otherwise expressly permitted under this Agreement;


 


(ii)                                  transactions among the
Borrowers and/or the Guarantors not prohibited under this Agreement (provided
that such transactions shall remain subject to any other applicable limitations
and restrictions set forth in this Agreement);


 


(iii)                               transactions with
officers or directors (solely in their capacity as an officer or director); and


 


(iv)                              restricted payments
permitted under Section 8.4.


 


8.6                                 Transactions
with Franchisees. Each of the Borrowers will not and
will not permit any of their Subsidiaries to, engage in any material
transactions with any Franchisee except on such terms as are agreed to by an
officer of the Borrowers that in such officer’s reasonable business judgment,
will provide economic benefit to the Borrowers or one of their Subsidiaries.


 


8.7                                 Lines of
Business. Each of the Borrowers will not, and will not permit or
cause any of its Subsidiaries to, engage in any business other than a Line of
Business.


 


8.8                                 Sale-Leaseback
Transactions. Each of the Borrowers will not, and will not permit
or cause any of its Subsidiaries to, directly or indirectly, become or remain
liable as lessee or as guarantor or other surety with respect to any lease,
whether an operating lease or a Capital Lease, of any property (whether real,
personal or mixed, and whether now owned or hereafter acquired) (i) that
any Credit Party has sold or transferred (or is to sell or transfer) to a
Person that is not a Credit Party or (ii) that any Credit Party intends to
use for substantially the same purpose as any other property that, in
connection with such lease, has been sold or transferred (or is to be sold or
transferred) by a Credit Party to another Person that is not a Credit Party, in
each case except for transactions otherwise expressly permitted under this
Agreement and except for any such sale or transfer (made in connection with the
corresponding leaseback of the relevant asset) by the Borrowers or any
Subsidiary of any fixed or capital assets acquired (or the construction of
which is completed) after the Closing Date that is made for cash consideration
in an amount not less than the cost of such fixed or capital asset and is
consummated within 30 days after such Borrower or such Subsidiary acquires or
completes the construction of such fixed or capital asset.


 


8.9                                 Certain
Amendments. Each of the Borrowers will not, and will not permit
or cause any of its Subsidiaries to, amend, modify or change any provision of
its articles or certificate of incorporation or formation, bylaws, operating
agreement or other applicable 


 


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formation
or organizational documents, as applicable, the terms of any class or series of
its Capital Stock, or any agreement among the holders of its Capital Stock or
any of them, in each case other than in a manner that could not reasonably be
expected to adversely affect the Lenders in any material respect.


 


8.10                           Restrictive
Agreements. Each of the Borrowers will not, and will not permit
or cause any of its Subsidiaries to, directly or indirectly, enter into, incur,
or permit to exist any agreement or other arrangement that prohibits, restricts
or imposes any condition upon (a) the
ability of the Borrowers or their Subsidiaries to create, incur or permit to
exist any Lien upon the properties or assets of the Borrowers or such
Subsidiaries, or (b) the ability of the Borrowers or any Subsidiary to pay
dividends or other distributions with respect to any shares of its Capital
Stock or to make or repay loans or advances to the Borrowers or any such
Subsidiaries or to guaranty indebtedness of the Borrowers or any such Subsidiaries;
provided, that (i) the foregoing shall not apply to any
restrictions or conditions imposed by a Requirement of Law, this Agreement or
the other Credit Documents, (ii) the foregoing shall not apply to
restrictions and conditions existing on the date hereof and identified on Schedule 8.10 (but shall apply to any extension or renewal of, or any amendment
or modification expanding the scope of, any such restriction or condition), (iii) the
foregoing shall not apply to customary restrictions and conditions contained in
agreements relating to the sale of a Subsidiary pending such sale; provided,
such restrictions and conditions apply only to the Subsidiary that is to be
sold and such sale is permitted hereunder, (iv) clause (a) of the foregoing shall not apply to
restrictions or conditions imposed by any agreement related to secured
Indebtedness permitted by this Agreement if such restrictions or conditions
apply only to the property or assets securing such Indebtedness, and (v) clause (a) of the foregoing shall not
apply to customary provisions in leases and other contracts restricting the
assignment thereof.


 


8.11                           Fiscal Year. Each of
the Borrowers will not, and will not permit or cause any of its Subsidiaries
to, change its fiscal year or its method of determining fiscal quarters.


 


8.12                           Accounting
Changes. Other than as permitted pursuant to Section 1.2,
each of the Borrowers will not, and will not permit or cause any of its
Subsidiaries to, make or permit any material change in its accounting policies
or reporting practices, except as are made in conformity with GAAP (or, in the
case of Foreign Subsidiaries, generally accepted accounting principles in the
jurisdiction of its organization).


 


ARTICLE IX


 


EVENTS OF DEFAULT


 


9.1                                 Events of
Default. The occurrence of any one or more of the following events
shall constitute an “Event of Default”:


 


(a)                                  The
Borrowers shall fail to pay when due (i) any principal of any Loan or any
Reimbursement Obligation, or (ii) any interest on any Loan, any fee
payable under this Agreement or any other Credit Document, or (except as
provided in clause (i) above) any other Obligation (other than any
Obligation under a Hedge Agreement), and (in the case of this clause (ii) only)
such failure shall continue for a period of three (3) Business Days;


 


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(b)                                 The
Borrowers or any other Credit Party shall (i) fail to observe, perform or
comply with any condition, covenant or agreement contained in any of Sections 2.14, 6.1, 6.2(a), 6.2(f)(i), 6.3(i), or 6.8 or in ARTICLE VII
or ARTICLE VIII or (ii) fail to observe, perform or comply with
any condition, covenant or agreement contained in Section 6.2
(other than Sections 6.2(a) and 6.2(f)(i)) and (in the case of this clause (ii) only)
such failure shall continue unremedied for a period of five (5) days after
the earlier of (y) the date on which a Responsible Officer of a Borrower
acquires knowledge thereof and (z) the date on which written notice thereof is
delivered by the Administrative Agent or any Lender to the Borrowers;


 


(c)                                  The
Borrowers or any other Credit Party shall fail to observe, perform or comply
with any condition, covenant or agreement contained in this Agreement or any of
the other Credit Documents other than those enumerated in Sections 9.1(a) and 9.1(b), and such failure (i) by the express terms of
such Credit Document, constitutes an Event of Default, or (ii) shall
continue unremedied for any grace period specifically applicable thereto or, if
no grace period is specifically applicable, for a period of thirty (30) days
after the earlier of (y) the date on which a Responsible Officer of a Borrower
acquires knowledge thereof and (z) the date on which written notice thereof is
delivered by the Administrative Agent or any Lender to the Borrowers; or any
default or event of default shall occur under any Hedge Agreement to which a
Borrower and any Hedge Party are parties;


 


(d)                                 Any
representation or warranty made or deemed made by or on behalf of the Borrowers
or any other Credit Party in this Agreement, any of the other Credit Documents
or in any certificate, instrument, report or other document furnished at any
time in connection herewith or therewith shall prove to have been incorrect,
false or misleading in any material respect as of the time made, deemed made or
furnished;


 


(e)                                  The
Borrowers or any other Credit Party shall (i) fail to pay when due
(whether by scheduled maturity, acceleration or otherwise and after giving
effect to any applicable grace period or notice provisions) (y) any principal
of or interest on any Indebtedness (other than the Indebtedness incurred
pursuant to this Agreement or a Hedge Agreement) having an aggregate principal
amount of at least $10,000,000 or (z) any termination or other payment under
any Hedge Agreement covering a notional amount of Indebtedness of at least $10,000,000
or (ii) fail to observe, perform or comply with any condition, covenant or
agreement contained in any agreement or instrument evidencing or relating to
any such Indebtedness, or any other event shall occur or condition exist in
respect thereof, and the effect of such failure, event or condition is to
cause, or permit the holder or holders of such Indebtedness (or a trustee or
agent on its or their behalf) to cause (with or without the giving of notice,
lapse of time, or both), but giving effect to any cure periods with respect
thereto, such Indebtedness to become due, or to be prepaid, redeemed, purchased
or defeased, prior to its stated maturity (excluding any Indebtedness that
becomes due as a result of the voluntary sale or transfer of the property or
assets securing such Indebtedness and such Indebtedness is satisfied within
five (5) Business Days of such sale or transfer);


 


(f)                                    Any Borrower
or any other Credit Party shall (i) file a voluntary petition or commence
a voluntary case seeking liquidation, winding-up, reorganization, dissolution,
arrangement, readjustment of debts or any other relief under the Bankruptcy
Code or under any other applicable bankruptcy, insolvency or similar law now or
hereafter in effect, (ii) consent to 


 


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the
institution of, or fail to controvert in a timely and appropriate manner, any
petition or case of the type described in Section 9.l(g), (iii) apply for or consent to
the appointment of or taking possession by a custodian, trustee, receiver or
similar official for or of itself or all or a substantial part of its
properties or assets, (iv) fail generally, or admit in writing its
inability, to pay its debts generally as they become due, (v) make a
general assignment for the benefit of creditors or (vi) take any corporate
action to authorize or approve any of the foregoing;


 


(g)                                 Any
involuntary petition or case shall be filed or commenced against a Borrower or
any other Credit Party seeking liquidation, winding-up, reorganization,
dissolution, arrangement, readjustment of debts, the appointment of a
custodian, trustee, receiver or similar official for it or all or a substantial
part of its properties or any other relief under the Bankruptcy Code or under
any other applicable bankruptcy, insolvency or similar law now or hereafter in
effect, and such petition or case shall continue undismissed and unstayed for a
period of sixty (60) days; or an order, judgment or decree approving or
ordering any of the foregoing shall be entered in any such proceeding;


 


(h)                                 Any one or
more money judgments, writs or warrants of attachment, executions or similar
processes involving an aggregate amount (to the extent not paid or fully bonded
or covered by insurance as to which the surety or insurer, as the case may be,
has the financial ability to perform and has acknowledged liability in writing)
in excess of $10,000,000 shall be entered or filed against a Borrower or any
other Credit Party or any of their respective properties and the same shall not
be paid, dismissed, bonded, vacated, stayed or discharged within a period of
thirty (30) days or in any event later than five (5) days prior to the
date of any proposed sale of such property thereunder;


 


(i)                                     The Guaranty
shall for any reason cease to be in full force and effect as to any Guarantor,
or any Guarantor or any Person acting on its behalf shall deny or disaffirm
such Guarantor’s obligations thereunder;


 


(j)                                     Any ERISA
Event or any other event or condition shall occur or exist with respect to any
Plan or Multiemployer Plan and, as a result thereof, together with all other
ERISA Events and other events or conditions then existing, any Credit Party and
its ERISA Affiliates have incurred, or could reasonably be expected to incur,
liability to any one or more Plans or Multiemployer Plans or to the PBGC (or to
any combination thereof) that could reasonably be expected to have a Material
Adverse Effect;


 


(k)                                  Any of the
following shall occur:


 


(i)                                     except as
expressly permitted pursuant to Section 8.1(i) or 8.1(vii), the Parent shall cease to own
directly or indirectly 100% of the issued and outstanding Capital Stock of the
other Borrowers,


 


(ii)                                  any Person
or group of Persons (within the meaning of the Exchange Act rules) shall have
become the beneficial owner of outstanding Capital Stock of the Parent having
30% or more of the Total Voting Power of the Parent, or


 


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(iii)                               the
occupation of a majority of the seats (other than vacant seats) on the board of
directors of the Parent by Persons who were neither (x) nominated by the board
of directors of the Parent nor (y) appointed by directors so nominated.


 


9.2                                 Remedies;
Termination of Commitments, Acceleration, etc. Upon and at any
time after the occurrence and during the continuance of any Event of Default,
the Administrative Agent shall at the direction, or may with the consent, of
the Required Lenders, take any or all of the following actions at the same or
different times:


 


(a)                                  Declare the
Revolving Credit Commitments, the Swingline Commitment, and the Issuing Lender’s
obligation to issue Letters of Credit, to be terminated, whereupon the same
shall terminate; provided that, upon the occurrence of a Bankruptcy
Event, the Revolving Credit Commitments, the Swingline Commitment and the
Issuing Lender’s obligation to issue Letters of Credit shall automatically be
terminated;


 


(b)                                 Declare all
or any part of the outstanding principal amount of the Loans to be immediately
due and payable, whereupon the principal amount so declared to be immediately
due and payable, together with all interest accrued thereon and all other
amounts payable under this Agreement and the other Credit Documents (but
excluding any amounts owing under any Hedge Agreement), shall become immediately
due and payable without presentment, demand, protest, notice of intent to
accelerate or other notice or legal process of any kind, all of which are
hereby knowingly and expressly waived by the Borrowers; provided that,
upon the occurrence of a Bankruptcy Event, all of the outstanding principal
amount of the Loans and all other amounts described in this Section 9.2(b) shall
automatically become immediately due and payable without presentment, demand,
protest, notice of intent to accelerate or other notice or legal process of any
kind, all of which are hereby knowingly and expressly waived by the Borrowers;


 


(c)                                  Direct the
Borrowers to deposit (and the Borrowers hereby agree, forthwith upon receipt of
notice of such direction from the Administrative Agent, to deposit) with the
Administrative Agent from time to time such additional amount of cash as is
equal to the aggregate Stated Amount of all Letters of Credit then outstanding
(whether or not any beneficiary under any Letter of Credit shall have drawn or
be entitled at such time to draw thereunder), such amount to be held by the
Administrative Agent in the Cash Collateral Account as security for the Letter
of Credit Exposure as described in Section 3.8;


 


(d)                                 Appoint or
direct the appointment of a receiver for the properties and assets of the
Credit Parties, both to operate and to sell such properties and assets, and the
Borrowers, for themselves and on behalf of their Subsidiaries, hereby consent
to such right and such appointment and hereby waive any objection the Borrowers
or any Subsidiary may have thereto or the right to have a bond or other
security posted by the Administrative Agent on behalf of the Lenders, in
connection therewith; and


 


(e)                                  Exercise all
rights and remedies available to it under this Agreement, the other Credit
Documents and applicable law.


 


9.3                                 Remedies;
Set-Off. Upon and at any time after the occurrence and during the
continuance of any Event of Default, each Lender, the Issuing Lender and each
of their 


 


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respective
Affiliates is hereby authorized at any time and from time to time, to the
fullest extent permitted by applicable law, to set off and apply any and all
deposits (general or special, time or demand, provisional or final, in whatever
currency) at any time held and other obligations (in whatever currency) at any
time owing by such Lender, the Issuing Lender or any such Affiliate to or for
the credit or the account of the Borrowers against any and all of the
obligations of the Borrowers now or hereafter existing under this Agreement or
any other Credit Document to such Lender or the Issuing Lender, irrespective of
whether or not such Lender or the Issuing Lender shall have made any demand
under this Agreement or any other Credit Document and although such obligations
of the Borrowers may be contingent or unmatured or are owed to a branch or
office of such Lender or the Issuing Lender different from the branch or office
holding such deposit or obligated on such indebtedness. The rights of each
Lender, the Issuing Lender and their respective Affiliates under this Section are
in addition to other rights and remedies (including other rights of setoff)
that such Lender, the Issuing Lender or their respective Affiliates may have.
Each Lender and the Issuing Lender agrees to notify the Borrowers and the
Administrative Agent promptly after any such setoff and application; provided
that the failure to give such notice shall not affect the validity of such
setoff and application.


 


ARTICLE X


 


THE ADMINISTRATIVE
AGENT


 


10.1                           Appointment
and Authority. Each of the Lenders (for purposes of this Article,
references to the Lenders shall also mean the Issuing Lender and the Swingline
Lender) hereby irrevocably appoints Wachovia to act on its behalf as the
Administrative Agent hereunder and under the other Credit 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 Lenders, and neither the Borrowers
nor any other Credit Party shall have rights as a third party beneficiary of
any of such provisions.


 


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 Borrowers or any Subsidiary or other Affiliate thereof as
if such Person were not the Administrative Agent hereunder and without any duty
to account therefore to the Lenders.


 


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 or Event of Default has occurred and is continuing;


 


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(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 Credit 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 Credit 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 Credit Document or applicable law; and


 


(c)                                  shall not,
except as expressly set forth herein and in the other Credit Documents, have
any duty to disclose, and shall not be liable for the failure to disclose, any
information relating to the Borrowers or any of their 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 Sections 11.5 and 9.2)
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 or Event of Default unless and until notice describing
such Default or Event of Default is given to the Administrative Agent by a
Borrower or a Lender. 


 


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 Credit 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 or Event of Default, (iv) the validity,
enforceability, effectiveness or genuineness of this Agreement, any other
Credit Document or any other agreement, instrument or document or (v) the
satisfaction of any condition set forth in ARTICLE IV or elsewhere herein, other than
to confirm receipt of items expressly required to be delivered to the
Administrative Agent.


 


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 he genuine and to have been signed,
sent or otherwise authenticated by the proper Person. The Administrative Agent
also may rely upon any statement made to it orally or by telephone and believed
by it to have been made by the proper Person, and shall not incur any liability
for relying thereon. In determining compliance with any condition hereunder to
the making of a Loan, or the issuance of a Letter of Credit, that by its terms
must be fulfilled to the satisfaction of a Lender or the Issuing Lender, the
Administrative Agent may presume that such condition is satisfactory to such
Lender or the Issuing Lender unless the Administrative Agent shall have
received notice to the contrary from such Lender or the Issuing Lender prior to
the making of such Loan or the issuance of such Letter of Credit. The
Administrative Agent may consult with legal counsel 


 


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(who
may be counsel for the Borrowers), 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.


 


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
Credit 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.


 


10.6                           Resignation
of Administrative Agent. The Administrative Agent may at any
time give notice of its resignation to the Lenders and the Borrowers. Upon
receipt of any such notice of resignation, the Required Lenders shall have the
right, in consultation with the Borrowers, 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 thirty (30) days after the retiring Administrative Agent gives notice of
its resignation, then the retiring Administrative Agent may, on behalf of the
Lenders, appoint a successor Administrative Agent meeting the qualifications
set forth above; provided that if the Administrative Agent shall notify
the Borrowers 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 Credit Documents (except that in the case of any collateral security held
by the Administrative Agent on behalf of the Lenders under any of the Credit
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 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 Credit
Documents (if not already discharged therefrom as provided above in this
Section). The fees payable by the Borrowers to a successor Administrative Agent
shall be the same as those payable to its predecessor unless otherwise agreed
between the Borrowers and such successor. After the retiring Administrative
Agent’s resignation hereunder and under the other Credit Documents, the
provisions of this Article and Section 11.1
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.


 


10.7                           Non-Reliance
on Administrative Agent and Other Lenders. Each Lender
acknowledges that it has, independently and without reliance upon the
Administrative Agent or 


 


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


 


10.8                           No Other
Duties, Etc. Anything herein to the contrary notwithstanding,
none of the Bookrunners, Arrangers, Syndication Agent, Documentation Agent or
other agents listed on the cover page hereof shall have any powers, duties
or responsibilities under this Agreement or any of the other Credit Documents,
except in its capacity, as applicable, as the Administrative Agent or a Lender
hereunder.


 


10.9                           Guaranty
Matters. The Lenders hereby authorize the Administrative Agent, at
its option and in its discretion, to release (x) any Guarantor from its
obligations under the Guaranty and (y) Hewfant from its obligations under this
Agreement, 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 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 such Person from its obligations under the
Guaranty or this Agreement, as applicable, pursuant to this Section 10.9.


 


10.10                     Issuing
Lender and Swingline Lender. The provisions of this ARTICLE X (other
than Section 10.2) shall apply to the Issuing Lender and the Swingline
Lender mutatis mutandis to the same extent as such provisions apply to
the Administrative Agent.


 


ARTICLE XI


 


MISCELLANEOUS


 


11.1                           Expenses;
Indemnity; Damage Waiver.


 


(a)                                  The
Borrowers 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 Credit 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 Lender in connection with the
issuance, amendment, renewal or extension of any Letter of Credit or any demand
for payment thereunder and (iii) all out-of-pocket expenses incurred by
the Administrative Agent, any Lender or the Issuing Lender (including the fees,
charges and disbursements of any counsel for the Administrative Agent, any
Lender or the Issuing Lender), in connection with the enforcement or protection
of its rights (A) in connection with this Agreement and the other Credit
Documents, including its rights under this Section, or (B) in connection
with the Loans made or Letters of Credit issued 


 


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hereunder,
including all such out-of-pocket expenses incurred during any workout,
restructuring or negotiations in respect of such Loans or Letters of Credit.


 


(b)                                 The
Borrowers shall, jointly and severally, indemnify the Administrative Agent (and
any sub-agent thereof), each Lender, and each Related Party of any of the
foregoing persons (each such person being called an “Indemnitee”)
against, and hold each Indemnitee harmless from, any and all losses, claims,
damages, liabilities and related expenses (including the fees, charges and
disbursements of any counsel for any Indemnitee), incurred by any Indemnitee or
asserted against any Indemnitee by any third party or by the Parent and its
Subsidiaries arising out of, in connection with, or as a result of (i) the
execution or delivery of this Agreement, any other Credit 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, (ii) any
Loan or Letter of Credit or the use or proposed use of the proceeds therefrom
(including any refusal by the Issuing Lender to honor a demand for payment
under a Letter of Credit if the documents presented in connection with such
demand do not strictly comply with the terms of such Letter of Credit), (iii) any
actual or alleged presence or release of Hazardous Substances on or from any
property owned or operated by any the Parent or any of its Subsidiaries, or any
Environmental Claim related in any way to the Parent 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
Parent or any of its Subsidiaries, 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 Borrowers or any other Credit Party against an Indemnitee
for breach in bad faith of such Indemnitee’s obligations hereunder or under any
other Credit Document, if the Borrowers or such Credit Party has obtained a
final and nonappealable judgment in its favor on such claim as determined by a
court of competent jurisdiction.


 


(c)                                  To the
extent that the Borrowers for any reason fail to indefeasibly pay any amount
required under Section 11.1(a) or Section 11.1(b) to be paid by them to the
Administrative Agent (or any sub-agent thereof), the Issuing Lender or any
Related Party of any of the foregoing, each Lender severally agrees to pay to
the Administrative Agent (or any such sub-agent), the Issuing Lender or such
Related Party, as the case may be, such Lender’s proportion (based on the
percentages as used in determining the Required Lenders 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 Lender in its capacity as such, or against any Related Party of any of
the foregoing acting for the Administrative Agent (or any such sub-agent) or
the Issuing Lender in connection with such capacity. The obligations of the
Lenders under this Section 11.1(c) are
subject to the provisions of Section 2.3(c).


 


(d)                                 To the
fullest extent permitted by applicable law, the Borrowers shall not assert, and
hereby waive, any claim against any Indemnitee, on any theory of liability, for
special,


 


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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 Credit Document or any agreement or instrument contemplated hereby, the
transactions contemplated hereby or thereby, any Loan or Letter of Credit or
the use of the proceeds thereof. No Indemnitee referred to in Section 11.1(b) 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 Credit Documents or the transactions contemplated hereby
or thereby.


 


(e)                                  All amounts
due under this Section shall be payable by the Borrowers upon demand
therefor.


 


11.2                           Governing
Law; Submission to Jurisdiction; Waiver of Venue; Service of Process.


 


(a)                                  This
Agreement and the other Credit Documents shall (except as may be expressly
otherwise provided in any Credit Document) be governed by, and construed in
accordance with, the law of the State of New York (including Sections 5-1401
and 5-1402 of the New York General Obligations Law, but excluding all
other choice of law and conflicts of law rules); provided that each Letter
of Credit shall be governed by, and construed in accordance with, the laws or rules designated
in such Letter of Credit or application therefor or, if no such laws or rules are
designated, the International Standby Practices of the International Chamber of
Commerce, as in effect from time to time (the “ISP”), and, as to matters
not governed by the ISP, the laws of the State of New York (including Sections
5-1401 and 5-1402 of the New York General Obligations Law, but excluding all
other choice of law and conflicts of law rules).


 


(b)                                 Each
Borrower irrevocably and unconditionally submits, for itself and its property,
to the nonexclusive jurisdiction of the courts of the State of New York sitting
in New York County and of the United States District Court of the Southern
District of New York, and any appellate court from any thereof, in any action
or proceeding arising out of or relating to this Agreement or any other Credit
Document, or for recognition or enforcement of any judgment, and each of the
parties hereto irrevocably and unconditionally agrees that all claims in
respect of any such action or proceeding may be heard and determined in such
state court or, to the fullest extent permitted by applicable law, in such
federal court. Each of the parties hereto agrees that a final judgment in any
such action or proceeding shall be conclusive and may be enforced in other
jurisdictions by suit on the judgment or in any other manner provided by law.
Nothing in this Agreement or in any other Credit Document shall affect any
right that the Administrative Agent, any Lender or the Issuing Lender may
otherwise have to bring any action or proceeding relating to this Agreement or
any other Credit Document against a Borrower or any other Credit Party or its
properties in the courts of any jurisdiction.


 


(c)                                  Each
Borrower irrevocably and unconditionally waives, to the fullest extent
permitted by applicable law, any objection that it may now or hereafter have to
the laying of venue of any action or proceeding arising out of or relating to
this Agreement or any other Credit Document in any court referred to in Section 11.2(b). Each of the parties hereto hereby irrevocably waives, to the
fullest extent permitted by applicable law, the defense of an inconvenient
forum to the maintenance of such action or proceeding in any such court.


 


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(d)                                 Each party
hereto irrevocably consents to service of process in the manner provided for
notices in Section 11.4. Nothing in this Agreement will affect the right of any
party hereto to serve process in any other manner permitted by applicable law.


 


11.3                           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 CREDIT DOCUMENT OR THE TRANSACTIONS
CONTEMPLATED HEREBY OR THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER
THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR
ATTORNEY OF ANY OTHER PERSON HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH
OTHER PERSON WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE
FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO
HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT AND THE OTHER CREDIT DOCUMENTS
BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.


 


11.4                           Notices;
Effectiveness; Electronic Communication.


 


(a)                                  Except in
the cases of notices and other communications expressly permitted to be given
by telephone (and except as provided in Section 11.4(b)), 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:


 


(i)                                     if to the
Borrowers, the Administrative Agent, the Issuing Lender or the Swingline
Lender, to it at the address (or telecopier number) specified for such person
on Schedule 1.1; and


 


(ii)                                  if to any
Lender, to it at its address (or telecopier number) set forth 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 Section 11.4(b) shall be effective as provided in Section 11.4(b).


 


(b)                                 Notices and
other communications to the Lenders hereunder may be delivered or furnished by
electronic communication (including e-mail and internet or intranet websites)
pursuant to procedures approved by the Administrative Agent, provided
that the foregoing shall not apply to notices to any Lender pursuant to ARTICLE II if
such Lender has notified the Administrative Agent that it is incapable of
receiving notices under such Article by electronic communication. The
Administrative Agent or a Borrower may, in its discretion, agree to accept
notices and other communications to it hereunder by electronic communication
pursuant to 


 


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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 other
communications posted to an internet or intranet website shall be deemed
received when received by the Administrative Agent for posting on such internet
or intranet website.


 


(c)                                  Any party
hereto may change its address or telecopier number for notices and other
communications hereunder by notice to the other parties hereto (except that
each Lender need not give notice of any such change to the other Lenders in
their capacities as such).


 


11.5                           Amendments,
Waivers, etc. No amendment, modification, waiver or discharge or
termination of, or consent to any departure by any Credit Party from, any
provision of this Agreement or any other Credit Document shall be effective
unless in a writing signed by the Required Lenders (or by the Administrative
Agent at the direction or with the consent of the Required Lenders), and then
the same shall be effective only in the specific instance and for the specific
purpose for which given; provided, however, that no such amendment,
modification, waiver, discharge, termination or consent shall:


 


(a)                                  unless
agreed to by each Lender directly affected thereby, (i) reduce or forgive
the principal amount of any Loan or Reimbursement Obligation, reduce the rate
of or forgive any interest thereon (provided that only the consent of
the Required Lenders shall be required to waive the applicability of any
post-default increase in interest rates), or reduce or forgive any fees
hereunder (other than fees payable to the Administrative Agent, the Arranger or
the Issuing Lender for its own account), (ii) extend the final scheduled
maturity date or any other scheduled date for the payment of any principal of
or interest on any Loan (including any scheduled date for the mandatory
reduction or termination of any Revolving Credit Commitments, extend the time
of payment of any Reimbursement Obligation or any interest thereon, extend the
expiry date of any Letter of Credit beyond the Letter of Credit Maturity Date,
or extend the time of payment of any fees hereunder (other than fees payable to
the Administrative Agent, the Arranger or the Issuing Lender for its own
account), or (iii) increase any Revolving Credit Commitment of any such
Lender over the amount thereof in effect or extend the maturity thereof (it
being understood that a waiver of any condition precedent set forth in Section 4.2
or of any Default or Event of Default or mandatory reduction in the Revolving
Credit Commitments, if agreed to by the Required Lenders or all Lenders (as may
be required hereunder with respect to such waiver), shall not constitute such
an increase);


 


(b)                                 unless
agreed to by all of the Lenders, (i) release any Guarantor from its
obligations under the Guaranty (other than (A) as may be otherwise
specifically provided in this Agreement or in any other Credit Document or (B) in
connection with the sale or other disposition of all of the Capital Stock of
such Guarantor in a transaction expressly permitted under or pursuant to this
Agreement), (ii) reduce the percentage of the aggregate Revolving Credit
Commitments or of the aggregate unpaid principal amount of the Loans, or the
number or 


 


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percentage
of Lenders, that shall be required for the Lenders or any of them to take or
approve, or direct the Administrative Agent to take, any action hereunder or
under any other Credit Document (including as set forth in the definition of “Required
Lenders”), (iii) change any other provision of this Agreement or any
of the other Credit Documents requiring, by its terms, the consent or approval
of all the Lenders for such amendment, modification, waiver, discharge,
termination or consent, or (iv) change or waive any provision of Section 2.15, any other provision of this
Agreement or any other Credit Document requiring pro rata treatment of any
Lenders, or this Section 11.5; and


 


(c)                                  unless
agreed to by the Issuing Lender, the Swingline Lender or the Administrative
Agent in addition to the Lenders required as provided hereinabove to take such
action, affect the respective rights or obligations of the Issuing Lender, the
Swingline Lender or the Administrative Agent, as applicable, hereunder or under
any of the other Credit Documents.


 


Notwithstanding
the fact that the consent of all Lenders is required in certain circumstances
as set forth above, 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 Bankruptcy
Code supersedes the unanimous consent provisions set forth herein.


 


11.6                           Successors
and Assigns.


 


(a)                                  The
provisions of this Agreement shall be binding upon and inure to the benefit of
the parties hereto and their respective successors and assigns permitted
hereby, except that neither any Borrower nor any other Credit Party may assign
or otherwise transfer any of its rights or obligations hereunder without the
prior written consent of the Administrative Agent and each Lender and no Lender
may assign or otherwise transfer any of its rights or obligations hereunder
except (i) to an Eligible
Assignee in accordance with the provisions of Section 11.6(b),
(ii) by way of participation in accordance with the provisions of Section 11.6(d) or (iii) by way of pledge or
assignment of a security interest subject to the restrictions of Section 11.6(e) (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 Section 11.6(d) and,
to the extent expressly contemplated hereby, the Related Parties of each of the
Administrative Agent and the Lenders) any legal or equitable right, remedy or
claim under or by reason of this Agreement.


 


(b)                                 Any Lender
may at any time assign to one or more Eligible Assignees all or a portion of
its rights and obligations under this Agreement (including all or a portion of
its Revolving Credit Commitments and the Loans (including for purposes of this Section 11.6(b), participations in Letters of Credit
and in Swingline Loans) 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 Revolving Credit Commitment and the Loans at the time owing to it or
in the case of an assignment to a Lender or an Affiliate of a Lender or an
Approved Fund with respect to a Lender, the aggregate amount of the Revolving
Credit Commitment (which for this purpose includes Loans outstanding
thereunder) or, if the 


 


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applicable Revolving Credit Commitment is not then in
effect, the principal outstanding balance of the Loans of the assigning Lender
subject to each such assignment (determined as of the date the Assignment and
Assumption with respect to such assignment is delivered to the Administrative
Agent or, if “Trade Date” is specified in the Assignment and Assumption, as of
the Trade Date) shall not be less than (x) $5,000,000, in the case of any assignment in respect of a
Revolving Credit Commitment (which for this purpose includes Revolving Loans
outstanding), or (y) the entire Swingline Commitment and the full amount of the
outstanding Swingline Loans, in the case of Swingline Loans, unless each of the
Administrative Agent and, so long as no Default or Event of Default has
occurred and is continuing, the Borrowers otherwise consent (each such consent
not to be unreasonably withheld or delayed);


 


(ii)                                  each partial
assignment shall be made as an assignment of a proportionate part of all the
assigning Lender’s rights and obligations under this Agreement with respect to
the Loan or the Commitment assigned, except that this clause (ii) shall
not apply to rights in respect of Swingline Loans;


 


(iii)                               any
assignment of a Revolving Credit Commitment must be approved by the
Administrative Agent, the Issuing Lender, the Swingline Lender and (so long as
no Default or Event of Default has occurred and is continuing) the Borrowers,
each such consent not to be unreasonably withheld or delayed, unless the Person
that is the proposed assignee is itself a Lender with a Revolving Credit
Commitment (whether or not the proposed assignee would otherwise qualify as an
Eligible Assignee); and


 


(iv)                              the parties
to each assignment shall execute and deliver to the Administrative Agent an
Assignment and Assumption, together with a processing and recordation fee of $3,500
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 Section 11.6(c), 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 2.16(a), 2.16(b),
2.17, 2.18 and 11.1 with
respect to facts and circumstances occurring prior to the effective date of
such assignment. If requested by or on behalf of the Eligible Assignee, the
Borrowers, at their own expense, will execute and deliver to the Administrative
Agent a new Note or Notes to the order of the Eligible Assignee (and, if the
assigning Lender has retained any portion of its rights and obligations
hereunder, to the order of the assigning Lender), prepared in accordance with
the applicable provisions of Section 2.4 as necessary to reflect, after giving
effect to the assignment, the Revolving Credit Commitments and/or outstanding
Loans, as the case may be, of the Eligible Assignee and (to the extent of any
retained interests) the assigning Lender, in substantially the form of Exhibits A-1 and/or A-2,
as applicable. Any assignment or transfer by a Lender of 


 


86





















 


rights
or obligations under this Agreement that does not comply with this Section 11.6(b) 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 Section 11.6(c).


 


(c)                                  The
Administrative Agent, acting solely for this purpose as an agent of the
Borrowers, shall maintain at its address for notices referred to in Schedule 1.1 a copy of each Assignment and Assumption
delivered to it and a register for the recordation of the names and addresses
of the Lenders, and the Revolving Credit Commitments of, and principal amounts
of the Loans owing to, each Lender pursuant to the terms hereof from time to
time (the “Register”). The entries in the Register shall be conclusive,
and the Borrowers, 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 each of the
Borrowers and the Issuing Lender, 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 Credit Documents is
pending, any Lender wishing to consult with other Lenders in connection
therewith may request and receive from the Administrative Agent a copy of the
Register.


 


(d)                                 Any Lender
may at any time, without the consent of, or notice to, the Borrowers or the
Administrative Agent, sell participations to any Person (other than a natural
person or the Borrowers or any of the Borrowers’ Affiliates or Subsidiaries)
(each, a “Participant”) in all or a portion of such Lender’s rights
and/or obligations under this Agreement (including all or a portion of its
Revolving Credit Commitments and/or the Loans (including such Lender’s
participations in Letters of Credit and Swingline Loans) owing to it); provided
that (i) such Lender’s obligations under this Agreement shall remain
unchanged, (ii) such Lender shall remain solely responsible to the other
parties hereto for the performance of such obligations and (iii) the Borrowers,
the Administrative Agent and the Lenders shall continue to deal solely and
directly with such Lender in connection with such Lender’s rights and
obligations under this Agreement. 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 Section 11.5(a) and
clause (i) of Section 11.5(b) that
affects such Participant. Subject to Section 11.6(e),
the Borrowers agree that each Participant shall be entitled to the benefits of Sections 2.16(a), 2.16(b), 2.17 and 2.18 to
the same extent as if it were a Lender and had acquired its interest by
assignment pursuant to Section 11.6(b).
To the extent permitted by law, each Participant also shall be entitled to the
benefits of Section 9.3 as though it were a Lender; provided such
Participant agrees to be subject to Section 2.15(b) as
though it were a Lender.


 


(e)                                  A
Participant shall not be entitled to receive any greater payment under Section 2.16(a), Section 2.16(b) or Section 2.17 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
Borrowers’ prior written consent. A Participant that would be a Foreign Lender
if it were a Lender shall not be entitled to the benefits of Section 2.17 unless the Borrowers are notified of the
participation sold to such Participant and 


 


87





















 


such
Participant agrees, for the benefit of the Borrowers, to comply with Section 2.17(e) as
though it were a Lender.


 


(f)                                    Any Lender
may at any time pledge or assign a security interest in all or any portion of
its rights under this Agreement (including under its Notes, 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)                                 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 or any state laws based on the Uniform
Electronic Transactions Act.


 


(h)                                 Any Lender
or participant may, in connection with any assignment, participation, pledge or
proposed assignment, participation or pledge pursuant to this Section 11.6, disclose to the Assignee,
Participant or pledgee or proposed Assignee, Participant or pledgee any
information relating to the Borrowers and their Subsidiaries furnished to it by
or on behalf of any other party hereto, provided that such Assignee,
Participant or pledgee or proposed Assignee, Participant or pledgee agrees in
writing to keep such information confidential to the same extent required of
the Lenders under Section 11.11.


 


(i)                                     Notwithstanding
anything to the contrary contained herein, if Wachovia assigns all of its
Revolving Credit Commitments and Revolving Loans in accordance with this Section 11.6, Wachovia may resign as Issuing
Lender upon written notice to the Borrowers and the Lenders. Upon any such
notice of resignation, the Borrowers shall have the right to appoint from among
the Lenders a successor Issuing Lender; provided that no failure by the
Borrowers to make such appointment shall affect the resignation of Wachovia as
Issuing Lender. Wachovia shall retain all of the rights and obligations of the
Issuing Lender hereunder with respect to all Letters of Credit issued by it and
outstanding as of the effective date of its resignation and all obligations of
the Borrowers and the Revolving Credit Lenders with respect thereto (including
the right to require the Revolving Credit Lenders to make Revolving Loans or
fund participation interests pursuant to ARTICLE III).


 


(j)                                     Notwithstanding
any other provision of this Agreement, no Lender will assign its rights and
obligations under this Agreement, or sell participations in its rights and/or
obligations under this Agreement, to any Person who is (i) listed on the
Specially Designated Nationals and Blocked Persons List maintained by OFAC
and/or on any other similar list maintained by OFAC pursuant to any authorizing
statute, executive order or regulation or (ii) either (A) included
within the term “designated national” as defined in the Cuban Assets Control
Regulations, 31 C.F.R. Part 515 or (B) designated under Sections
l(a), 1(b), 1(c) or 1(d) of Executive Order No. 13224, 66 Fed. Reg. 49079 (published September 25,
2001) or similarly designated under any related enabling legislation or any
other similar executive orders.


 


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11.7                           No Waiver. The rights
and remedies of the Administrative Agent and the Lenders expressly set forth in
this Agreement and the other Credit Documents are cumulative and in addition
to, and not exclusive of, all other rights and remedies available at law, in
equity or otherwise. No failure or delay on the part of the Administrative
Agent or any Lender in exercising any right, power or privilege shall operate
as a waiver thereof, nor shall any single or partial exercise of any such
right, power or privilege preclude other or further exercise thereof or the
exercise of any other right, power or privilege or be construed to be a waiver
of any Default or Event of Default. No course of dealing between any Credit
Party, the Administrative Agent or the Lenders or their agents or employees
shall be effective to amend, modify or discharge any provision of this
Agreement or any other Credit Document or to constitute a waiver of any Default
or Event of Default. No notice to or demand upon any Credit Party in any case
shall entitle any Credit Party to any other or further notice or demand in
similar or other circumstances or constitute a waiver of the right of the
Administrative Agent or any Lender to exercise any right or remedy or take any
other or further action in any circumstances without notice or demand.


 


11.8                           Survival. All
representations, warranties and agreements made by or on behalf of the
Borrowers or any other Credit Party in this Agreement and in the other Credit
Documents shall survive the execution and delivery hereof or thereof, the
making and repayment of the Loans and the issuance and repayment of the Letters
of Credit. In addition, notwithstanding anything herein or under applicable law
to the contrary, the provisions of this Agreement and the other Credit
Documents relating to indemnification or payment of costs and expenses,
including, without limitation, the provisions of Sections 2.16(a), 2.16(b), 2.17, 2.18 and 11.1,
shall survive the payment in full of all Loans and Letters of Credit,
the termination of the Revolving Credit Commitments and all Letters of Credit,
and any termination of this Agreement or any of the other Credit Documents.


 


11.9                           Severability. To the
extent any provision of this Agreement is prohibited by or invalid under the
applicable law of any jurisdiction, such provision shall be ineffective only to
the extent of such prohibition or invalidity and only in such jurisdiction,
without prohibiting or invalidating such provision in any other jurisdiction or
the remaining provisions of this Agreement in any jurisdiction.


 


11.10                     Construction. The
headings of the various articles, sections and subsections of this Agreement
and the table of contents have been inserted for convenience only and shall not
in any way affect the meaning or construction of any of the provisions hereof.
Except as otherwise expressly provided herein and in the other Credit
Documents, in the event of any inconsistency or conflict between any provision
of this Agreement and any provision of any of the other Credit Documents, the
provision of this Agreement shall control. Without limiting the foregoing, no
payment by the Borrowers under this Agreement, including without limitation any
voluntary or mandatory prepayment of the Loans, shall affect the Borrowers’
obligation to continue making payments under any Hedge Agreement with any Hedge
Party, which shall remain in full force and effect notwithstanding such
prepayment, subject to the terms of such Hedge Agreement.


 


11.11                     Confidentiality. Each of
the Administrative Agent, the Lenders and the Issuing Lender agree 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, 


 


89





















 


directors,
officers, employees, agents, advisors and other 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 Requirements of
Law or by any subpoena or similar legal process’ provided, that the
Administrative Agent, the Issuing Lender or such Lender, as the case may be,
shall, at the Borrowers’ expense, request confidential treatment of such
Information to the extent permitted by applicable law and the Administrative
Agent, the Issuing Lender, or such Lender, as the case may be, shall, to the
extent permitted by applicable law, promptly inform the Borrowers with respect
thereto so that the Borrowers may seek appropriate protective relief to the
extent permitted by applicable law and provided,  further, that in
the event that such protective remedy or other remedy is not obtained, the Administrative
Agent, the Issuing Lender or such Lender, as the case may be, shall furnish
only that portion of the Information that, on the advice of counsel, is legally
required and shall disclose the Information in a manner reasonably designed to
preserve its confidential nature and shall cooperate (at the Borrowers’
expense) with the Borrowers’ counsel to obtain a protective order or other
reasonable assurance that confidential treatment will be accorded to the
Information, (d) to any other party hereto, (e) in connection with
the exercise of any remedies hereunder or under any other Credit Document or
any Hedge Agreement or any action or proceeding relating to this Agreement or
any other Credit Document or any Hedge Agreement or the enforcement of rights hereunder
or thereunder, (f) subject to an agreement containing provisions
substantially the same as those of this Section, 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, (ii) any actual or prospective
counterparty (or its advisors) to any swap or derivative transaction relating
to a Borrower and its obligations, (iii) an investor or prospective
investor in an Approved Fund that also agrees that Information shall be used
solely for the purpose of evaluating an investment in such Approved Fund, (iv) a
trustee, collateral manager, servicer, backup servicer, noteholder or secured
party in an Approved Fund in connection with the administration, servicing and
reporting on the assets serving as collateral for an Approved Fund, or (v) a
nationally recognized rating agency that requires access to information
regarding the Credit Parties, the Loans and Credit Documents in connection with
ratings issued with respect to an Approved Fund, (g) with the consent of the Borrowers or (h) to the
extent such Information (x) becomes publicly available other than as a result
of a breach of this Section or (y) becomes available to the Administrative
Agent, any Lender, the Issuing Lender or any of their respective Affiliates on
a nonconfidential basis from a source other than the Borrowers or any of their
Subsidiaries or Affiliates.


 


For purposes of this Section, “Information”
means all information received from the Credit Parties relating to any Credit
Party or any of their respective businesses, other than any such information
that is available to the Administrative Agent, any Lender or the Issuing Lender
on a nonconfidential basis prior to disclosure by any Credit Party. 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.


 


90





















 


11.12                     Joint and
Several Liability.


 


(a)                                  The
Borrowers are jointly and severally liable for the Obligations. The Obligations
of the Borrowers are independent of each other, and a separate action or
actions may be brought and prosecuted against any Borrower to enforce this
Agreement, irrespective of whether any action is brought against any other
Borrower or whether any other Borrower is joined in any such action or actions.


 


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


 


(c)                                  Each
Borrower agrees that all indebtedness and other obligations, whether now or
hereafter existing, of any Borrower or any other Subsidiary to a Borrower, and
any intercompany receivables, together with any interest thereon, shall be, and
hereby are, subordinated and made junior in right of payment to the
Obligations. Each Borrower further agrees that if any amount shall be paid to
or any distribution received by it (i) on account of any such indebtedness
at any time after the occurrence and during the continuance of an Event of
Default, or (ii) on account of any such rights of subrogation, indemnity,
contribution or reimbursement at any time prior to the satisfaction of
Obligations hereunder, such amount or distribution shall be deemed to have been
received and to be held in trust for the benefit of the Lenders, and shall
forthwith be delivered to the Administrative Agent in the form received (with
any necessary endorsements in the case of written instruments), to be applied
against the Obligations, whether or not matured, in accordance with the terms
hereof or the applicable Credit Documents and without in any way discharging,
limiting or otherwise affecting the liability of such Borrower under any other
provision of this Agreement.


 


(d)                                 To the
fullest extent permitted under applicable law, each Borrower hereby waives any
right to require the Administrative Agent or any Lender to (i) proceed
against any Borrower, any other guarantor or any other party, or (ii) pursue
any other remedy in the Administrative Agent’s or any Lender’s power
whatsoever. Each Borrower waives any defense based on or arising out of any defense
of any other Borrower, any other guarantor or any other party other than the
satisfaction in full of the Obligations, including without limitation any
defense based on or arising out of the disability of any other Borrower, any
other guarantor or any other party or the cessation from any cause of the
liability of any other Borrower other than the satisfaction in full of
Obligations. Each Borrower waives all presentments, demands for performance,
protests and notices, including without limitation notices of nonperformance,
notices of protest, notices of dishonor, notices of acceptance, and notices of
the existence, creation or incurring of new or additional indebtedness.


 


11.13                     Appointment
of Administrative Borrower. Each Borrower hereby irrevocably
appoints Jackson Hewitt as the borrowing agent and attorney-in-fact for the
Borrowers (the “Administrative Borrower”) which appointment shall remain
in full force and effect unless and 


 


91





















 


until
the Administrative Agent shall have received prior written notice signed by all
of the Borrowers that such appointment has been revoked and that another
Borrower has been appointed Administrative Borrower. Each Borrower hereby
irrevocably appoints and authorizes the Administrative Borrower (i) to
provide to the Administrative Agent and receive from the Administrative Agent
all notices with respect to Loans obtained for the benefit of any Borrower and
all other notices and instructions under this Agreement and (ii) to take
such action as the Administrative Borrower deems appropriate on its behalf to
obtain Loans and to exercise such other powers as are reasonably incidental
thereto to carry out the purposes of this Agreement.


 


11.14                     Counterparts;
Integration; Effectiveness. This Agreement may be executed in
counterparts (and by different parties hereto in different counterparts), each
of which shall constitute an original, but all of which when taken together
shall constitute a single contract. This Agreement and the other Credit
Documents constitute the entire contract among the parties relating to the
subject matter hereof and supersede any and all previous agreements and
understandings, oral or written, relating to the subject matter hereof (except
for the Fee Letter). Except as provided in Section 4.1, this Agreement shall become effective when it shall
have been executed by the Administrative Agent and when the Administrative
Agent shall have received counterparts hereof that, when taken together, bear
the signatures of each of the other parties hereto. Delivery of an executed
counterpart of a signature page of this Agreement by telecopy shall be
effective as delivery of a manually executed counterpart of this Agreement.


 


11.15                     Disclosure
of Information. The Borrowers agree and consent to
the Administrative Agent’s and the Arranger’s disclosure of information
relating to this transaction to Gold Sheets and other similar bank trade
publications. Such information will consist of deal terms and other information
customarily found in such publications.


 


11.16                     USA Patriot
Act Notice. Each Lender that is subject to the Act (as defined
below) and the Administrative Agent (for itself and not on behalf of any
Lender) hereby notifies the Borrowers 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 Borrowers, which
information includes the name and address of the Borrowers and other
information that will allow such Lender or the Administrative Agent, as
applicable, to identify the Borrowers in accordance with the Act.


 


92





















 


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


 


	
   

  	
  JACKSON HEWITT TAX SERVICE INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Mark L. Heimbouch

  
	
   

  	
   

  	
   

  
	
   

  	
  Title:

  	
  Chief Financial Officer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  JACKSON HEWITT INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Mark L. Heimbouch

  
	
   

  	
   

  	
   

  
	
   

  	
  Title:

  	
  Chief Financial Officer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  TAX SERVICES OF AMERICA, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Mark L. Heimbouch

  
	
   

  	
   

  	
   

  
	
   

  	
  Title:

  	
  Chief Financial Officer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  HEWFANT INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Mark L. Heimbouch

  
	
   

  	
   

  	
   

  
	
   

  	
  Title:

  	
  Chief Financial Officer

  



 


 


(signatures
continued)


 


S-1





















 


	
   

  	
  WACHOVIA
  BANK, NATIONAL

  
	
   

  	
  ASSOCIATION, as Administrative Agent, Issuing

  
	
   

  	
  Lender and as a Lender

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Eugene S. Smith

  
	
   

  	
   

  	
  Eugene S. Smith

  
	
   

  	
  Title:

  	
  Senior Vice President

  



 


S-2





















 


	
   

  	
  CITIBANK F.S.B., as
  Syndication Agent and as a 

  Lender

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Robert Matthews

  
	
   

  	
   

  	
   

  
	
   

  	
  Title:

  	
  Managing
  Director

  



 


S-3





















 


	
   

  	
  BANK OF AMERICA, N.A., as Syndication 

  Agent and as a Lender

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Elizabeth Kurilecz

  
	
   

  	
   

  	
  Elizabeth Kurilecz

  
	
   

  	
  Title:

  	
  Senior Vice President

  



 


S-4





















 


	
   

  	
  MANUFACTURES AND TRADERS TRUST 

  COMPANY, as
  Documentation Agent and as a 

  Lender

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Laurel Magruder

  
	
   

  	
   

  	
   

  
	
   

  	
  Title:

  	
  Vice President

  



 


S-5





















 


	
   

  	
  PNC BANK, NATIONAL ASSOCIATION, as 

  Documentation Agent and as a Lender

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Brian Daugherty

  
	
   

  	
   

  	
  Brian Daugherty

  
	
   

  	
  Title:

  	
  Vice President

  



 


S-6





















 


	
   

  	
  THE GOVERNOR AND COMPANY OF THE 

  BANK OF IRELAND, as
  a Lender

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Orla Halpenny

  
	
   

  	
   

  	
   

  
	
   

  	
  Title:

  	
  Manager

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Orla Halpenny

  



 


S-7





















 


	
   

  	
  THE BANK OF NEW YORK, as a Lender

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Stephen G. Necel

  
	
   

  	
   

  	
  Stephen G. Necel

  
	
   

  	
  Title:

  	
  Vice President

  



 


S-8





















 


	
   

  	
  CITIZENS BANK, as a Lender

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Jared M. Cannon

  
	
   

  	
   

  	
  Jared M. Cannon

  
	
   

  	
   

  	
   

  
	
   

  	
  Title:

  	
  Vice President

  



 


S-9





















 


	
   

  	
  JPMORGAN CHASE BANK, N.A. as a Lender

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Christine Herrick

  
	
   

  	
   

  	
   

  
	
   

  	
  Title:

  	
  CHRISTINE HERRICK

  VICE PRESIDENT

  JPMORGAN CHASE BANK, N.A.

  



 


S-11





















 


	
   

  	
  FIFTH THIRD BANK, as a Lender

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Paul Bloemeke

  
	
   

  	
   

  	
   

  
	
   

  	
  Title:

  	
  Assistant VP

  



 


S-12





















 


	
   

  	
  HSBC BANK USA, NATIONAL 

  ASSOCIATION, as a
  Lender

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Paul Lopez

  
	
   

  	
   

  	
   

  
	
   

  	
  Title:

  	
  SVP

  



 


S-13





















 


	
   

  	
  UNION BANK OF CALIFORNIA, N.A., as a 

  Lender

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Christine Davis

  
	
   

  	
   

  	
   

  
	
   

  	
  Title:

  	
  Christine Davis

  Vice President

  



 


S-14





















 


	
   

  	
  COMMERCE BANK, N.A., as a Lender

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Craig A. Pasko

  
	
   

  	
   

  	
   

  
	
   

  	
  Title:

  	
  Vice President

  



 


S-15