Exhibit 4.34


 


AMENDED AND RESTATED CREDIT AGREEMENT


 


Dated as of December 31, 2008


 


among


 


EVEREADY ENERGY SERVICES CORP., 

as Borrower,


 


THE OTHER CREDIT PARTIES SIGNATORY HERETO,

as Credit Parties,


 


- and -


 


GE CANADA ASSET FINANCING HOLDING COMPANY,

as Agent and Lender,


 


-and-


 


THE LENDERS SIGNATORY HERETO FROM TIME TO TIME,

as Lenders,


 


-and-


 


GE CAPITAL MARKETS, INC. and GE
CAPITAL MARKETS (CANADA) LTD.,

as Lead Arrangers,


 


-and-


 


BANK OF MONTREAL AND CANADIAN
IMPERIAL BANK OF COMMERCE,

as Co-Syndication Agents


 


-and-


 


BANK OF NOVA SCOTIA,


as Documentation Agent


 


Execution Copy


 

















 


TABLE OF
CONTENTS


 


	
  ARTICLE I
  AMOUNT AND TERMS OF CREDIT

  	
  1

  
	
   

  	
   

  
	
  1.1

  	
  Amendment and Restatement

  	
  1

  
	
   

  	
   

  	
   

  
	
  1.2

  	
  Revolving Credit Facility

  	
  2

  
	
   

  	
   

  	
   

  
	
  1.3

  	
  Swing Line Loans

  	
  6

  
	
   

  	
   

  	
   

  
	
  1.4

  	
  Term Loan B Facility

  	
  8

  
	
   

  	
   

  	
   

  
	
  1.5

  	
  Voluntary Reductions;
  Mandatory Prepayments

  	
  9

  
	
   

  	
   

  	
   

  
	
  1.6

  	
  Use of Proceeds

  	
  11

  
	
   

  	
   

  	
   

  
	
  1.7

  	
  Interest and Applicable
  Margins

  	
  12

  
	
   

  	
   

  	
   

  
	
  1.8

  	
  Fees

  	
  14

  
	
   

  	
   

  	
   

  
	
  1.9

  	
  Receipt of Payments

  	
  15

  
	
   

  	
   

  	
   

  
	
  1.10

  	
  Application and Allocation
  of Payments on Default

  	
  16

  
	
   

  	
   

  	
   

  
	
  1.11

  	
  Loan Account and
  Accounting

  	
  16

  
	
   

  	
   

  	
   

  
	
  1.12

  	
  Indemnity

  	
  16

  
	
   

  	
   

  	
   

  
	
  1.13

  	
  Access

  	
  18

  
	
   

  	
   

  	
   

  
	
  1.14

  	
  Taxes

  	
  18

  
	
   

  	
   

  	
   

  
	
  1.15

  	
  Capital Adequacy;
  Increased Costs; Illegality

  	
  19

  
	
   

  	
   

  	
   

  
	
  1.16

  	
  Currency Matters

  	
  21

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  II CONDITIONS PRECEDENT

  	
  21

  
	
   

  	
   

  
	
  2.1

  	
  Conditions to the
  Amendment and Restatement

  	
  21

  
	
   

  	
   

  	
   

  
	
  2.2

  	
  Further Conditions to Each
  Advance

  	
  25

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  III BANKERS’ ACCEPTANCES (REVOLVING CREDIT FACILITY)

  	
  25

  
	
   

  	
   

  
	
  3.1

  	
  General

  	
  25

  
	
   

  	
   

  	
   

  
	
  3.2

  	
  Terms of Acceptance by the
  Lenders

  	
  25

  
	
   

  	
   

  	
   

  
	
  3.3

  	
  BA Equivalent Loans

  	
  26

  
	
   

  	
   

  	
   

  
	
  3.4

  	
  General Mechanics

  	
  27

  
	
   

  	
   

  	
   

  
	
  3.5

  	
  Escrowed Funds

  	
  28

  
	
   

  	
   

  	
   

  
	
  3.6

  	
  Market Disruption

  	
  29

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  IV REPRESENTATIONS AND WARRANTIES

  	
  29

  
	
   

  	
   

  
	
  4.1

  	
  Corporate Existence;
  Compliance with Law

  	
  29

  
	
   

  	
   

  	
   

  
	
  4.2

  	
  Executive Offices,
  Collateral Locations

  	
  30

  
	
   

  	
   

  	
   

  
	
  4.3

  	
  Corporate Power, Authorization,
  Enforceable Obligations

  	
  30

  



 


i

















 


TABLE OF CONTENTS


(continued)


 


	
  4.4

  	
  Financial Statements and
  Projections

  	
  30

  
	
   

  	
   

  	
   

  
	
  4.5

  	
  Material Adverse Effect

  	
  31

  
	
   

  	
   

  	
   

  
	
  4.6

  	
  Ownership of Property;
  Liens

  	
  31

  
	
   

  	
   

  	
   

  
	
  4.7

  	
  Labour Matters

  	
  32

  
	
   

  	
   

  	
   

  
	
  4.8

  	
  Ventures, Subsidiaries and
  Affiliates; Outstanding Stock and Indebtedness

  	
  33

  
	
   

  	
   

  	
   

  
	
  4.9

  	
  Government Regulation

  	
  32

  
	
   

  	
   

  	
   

  
	
  4.10

  	
  Taxes

  	
  33

  
	
   

  	
   

  	
   

  
	
  4.11

  	
  No Litigation

  	
  33

  
	
   

  	
   

  	
   

  
	
  4.12

  	
  Canadian Pension Plan and
  Benefit Plans

  	
  34

  
	
   

  	
   

  	
   

  
	
  4.13

  	
  Brokers

  	
  34

  
	
   

  	
   

  	
   

  
	
  4.14

  	
  Intellectual Property

  	
  34

  
	
   

  	
   

  	
   

  
	
  4.15

  	
  Full Disclosure

  	
  35

  
	
   

  	
   

  	
   

  
	
  4.16

  	
  Environmental Matters

  	
  35

  
	
   

  	
   

  	
   

  
	
  4.17

  	
  Insurance Disclosure

  	
  36

  
	
   

  	
   

  	
   

  
	
  4.18

  	
  Deposit and Disbursement
  Accounts

  	
  36

  
	
   

  	
   

  	
   

  
	
  4.19

  	
  Government Contracts

  	
  37

  
	
   

  	
   

  	
   

  
	
  4.20

  	
  Customer and Trade
  Relations

  	
  37

  
	
   

  	
   

  	
   

  
	
  4.21

  	
  Bonding; Licenses

  	
  37

  
	
   

  	
   

  	
   

  
	
  4.22

  	
  Solvency

  	
  37

  
	
   

  	
   

  	
   

  
	
  ARTICLE V
  FINANCIAL STATEMENTS AND INFORMATION

  	
  37

  
	
   

  	
   

  
	
  5.1

  	
  Reports and Notices

  	
  37

  
	
   

  	
   

  	
   

  
	
  5.2

  	
  Communication with
  Accountants

  	
  42

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  VI AFFIRMATIVE COVENANTS

  	
  42

  
	
   

  	
   

  
	
  6.1

  	
  Maintenance of Existence
  and Conduct of Business

  	
  42

  
	
   

  	
   

  	
   

  
	
  6.2

  	
  Payment of Charges

  	
  43

  
	
   

  	
   

  	
   

  
	
  6.3

  	
  Books and Records

  	
  43

  
	
   

  	
   

  	
   

  
	
  6.4

  	
  Insurance; Damage to or
  Destruction of Collateral

  	
  43

  
	
   

  	
   

  	
   

  
	
  6.5

  	
  Compliance with Laws

  	
  45

  
	
   

  	
   

  	
   

  
	
  6.6

  	
  Supplemental Disclosure

  	
  46

  



 


ii

















 


TABLE OF CONTENTS


(continued)


 


	
  6.7

  	
  Intellectual Property

  	
  47

  
	
   

  	
   

  	
   

  
	
  6.8

  	
  Environmental Matters

  	
  47

  
	
   

  	
   

  	
   

  
	
  6.9 

  	
  Landlords’ Agreements,
  Mortgagee Agreements, Bailee Letters and Real Estate Purchases

  	
  48

  
	
   

  	
   

  	
   

  
	
  6.10

  	
  Further Assurances

  	
  48

  
	
   

  	
   

  	
   

  
	
  ARTICLE VII  NEGATIVE COVENANTS

  	
  48

  
	
   

  	
   

  
	
  7.1

  	
  Amalgamations, Mergers,
  Subsidiaries, Etc

  	
  49

  
	
   

  	
   

  	
   

  
	
  7.2

  	
  Reorganization

  	
  52

  
	
   

  	
   

  	
   

  
	
  7.3

  	
  Investments; Loans and
  Advances

  	
  53

  
	
   

  	
   

  	
   

  
	
  7.4

  	
  Indebtedness

  	
  53

  
	
   

  	
   

  	
   

  
	
  7.5

  	
  Employee Loans and
  Affiliate Transactions

  	
  54

  
	
   

  	
   

  	
   

  
	
  7.6

  	
  Capital Structure and
  Business

  	
  54

  
	
   

  	
   

  	
   

  
	
  7.7

  	
  Guaranteed Indebtedness

  	
  54

  
	
   

  	
   

  	
   

  
	
  7.8

  	
  Liens

  	
  55

  
	
   

  	
   

  	
   

  
	
  7.9

  	
  Sale of Stock and Assets

  	
  55

  
	
   

  	
   

  	
   

  
	
  7.10

  	
  Pensions and Benefit Plans

  	
  55

  
	
   

  	
   

  	
   

  
	
  7.11

  	
  Hazardous Materials

  	
  56

  
	
   

  	
   

  	
   

  
	
  7.12

  	
  Sale Leasebacks

  	
  56

  
	
   

  	
   

  	
   

  
	
  7.13

  	
  Restricted Payments

  	
  56

  
	
   

  	
   

  	
   

  
	
  7.14

  	
  Change of Corporate Name
  or Location; Change of Fiscal Year

  	
  57

  
	
   

  	
   

  	
   

  
	
  7.15

  	
  No Impairment of
  Intercompany Transfers

  	
  57

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  VIII  FINANCIAL COVENANTS

  	
  57

  
	
   

  	
   

  
	
  8.1

  	
  Maximum Capital
  Expenditures

  	
  57

  
	
   

  	
   

  	
   

  
	
  8.2

  	
  Working Capital Ratio

  	
  58

  
	
   

  	
   

  	
   

  
	
  8.3

  	
  Fixed Charge Coverage
  Ratio

  	
  58

  
	
   

  	
   

  	
   

  
	
  8.4

  	
  Maximum Funded Senior Debt
  to EBITDA

  	
  58

  
	
   

  	
   

  	
   

  
	
  8.5

  	
  Funded Debt to EBITDA

  	
  58

  
	
   

  	
   

  	
   

  
	
  8.6

  	
  Maximum Distribution
  Payout

  	
  58

  
	
   

  	
   

  	
   

  
	
  8.7

  	
  Minimum Net Worth

  	
  59

  



 


iii

















 


TABLE OF CONTENTS


(continued)


 


	
  8.8

  	
  Additional Information

  	
  59

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  IX TERM

  	
  60

  
	
   

  	
   

  
	
  9.1

  	
  Termination

  	
  59

  
	
   

  	
   

  	
   

  
	
  9.2

  	
  Survival of Obligations
  Upon Termination of Financing Arrangements

  	
  60

  
	
   

  	
   

  	
   

  
	
  ARTICLE X
  EVENTS OF DEFAULT; RIGHTS AND REMEDIES

  	
  60

  
	
   

  	
   

  
	
  10.1

  	
  Events of Default

  	
  60

  
	
   

  	
   

  	
   

  
	
  10.2

  	
  Remedies

  	
  63

  
	
   

  	
   

  	
   

  
	
  10.3

  	
  Waivers by Credit Parties

  	
  64

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  XI ASSIGNMENT AND PARTICIPATIONS; APPOINTMENT OF AGENT

  	
  64

  
	
   

  	
   

  
	
  11.1

  	
  Assignment and
  Participations

  	
  64

  
	
   

  	
   

  	
   

  
	
  11.2

  	
  Appointment of Agent

  	
  67

  
	
   

  	
   

  	
   

  
	
  11.3

  	
  Agent’s Reliance, Etc

  	
  68

  
	
   

  	
   

  	
   

  
	
  11.4

  	
  GE Canada and Affiliates

  	
  68

  
	
   

  	
   

  	
   

  
	
  11.5

  	
  Lender Credit Decision

  	
  68

  
	
   

  	
   

  	
   

  
	
  11.6

  	
  Indemnification

  	
  69

  
	
   

  	
   

  	
   

  
	
  11.7

  	
  Successor Agent

  	
  69

  
	
   

  	
   

  	
   

  
	
  11.8

  	
  Setoff and Sharing of
  Payments

  	
  70

  
	
   

  	
   

  	
   

  
	
  11.9

  	
  Advances; Payments;
  Non-Funding Lenders; Information; Actions in Concert

  	
  71

  
	
   

  	
   

  	
   

  
	
  11.10

  	
  Lead Arrangers, Co-Syndication
  Agents and Documentation Agent

  	
  73

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  XII  SUCCESSORS AND ASSIGNS

  	
  73

  
	
   

  	
   

  
	
  12.1

  	
  Successors and Assigns

  	
  73

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  XIII  MISCELLANEOUS

  	
  74

  
	
   

  	
   

  
	
  13.1

  	
  Complete Agreement;
  Modification of Agreement

  	
  73

  
	
   

  	
   

  	
   

  
	
  13.2

  	
  Amendments and Waivers

  	
  74

  
	
   

  	
   

  	
   

  
	
  13.3

  	
  Fees and Expenses

  	
  76

  
	
   

  	
   

  	
   

  
	
  13.4

  	
  No Waiver

  	
  77

  
	
   

  	
   

  	
   

  
	
  13.5

  	
  Remedies

  	
  78

  
	
   

  	
   

  	
   

  
	
  13.6

  	
  Severability

  	
  78

  



 


iv

















 


TABLE OF CONTENTS


(continued)


 


	
  13.7

  	
  Conflict of Terms

  	
  78

  
	
   

  	
   

  	
   

  
	
  13.8

  	
  Confidentiality

  	
  78

  
	
   

  	
   

  	
   

  
	
  13.9

  	
  Governing Law

  	
  79

  
	
   

  	
   

  	
   

  
	
  13.10

  	
  Notices

  	
  79

  
	
   

  	
   

  	
   

  
	
  13.11

  	
  Section Titles

  	
  80

  
	
   

  	
   

  	
   

  
	
  13.12

  	
  Counterparts

  	
  80

  
	
   

  	
   

  	
   

  
	
  13.13

  	
  Press Releases and Related
  Matters

  	
  80

  
	
   

  	
   

  	
   

  
	
  13.14

  	
  Reinstatement

  	
  81

  
	
   

  	
   

  	
   

  
	
  13.15

  	
  Advice of Counsel

  	
  81

  
	
   

  	
   

  	
   

  
	
  13.16

  	
  No Strict Construction

  	
  81

  
	
   

  	
   

  	
   

  
	
  13.17

  	
  Judgment Currency

  	
  81

  
	
   

  	
   

  	
   

  
	
  13.18

  	
  Joint and Several
  Obligations

  	
  82

  
	
   

  	
   

  	
   

  
	
  13.19

  	
  Liability of Limited
  Partners

  	
  82

  



 


v
















 


INDEX
OF APPENDICES


 


	
  Annex A (Recitals)

  	
   

  	
  - Definitions

  
	
   

  	
   

  	
   

  
	
  Annex B

  	
   

  	
  - Lenders’ Wire Transfer
  Information

  
	
   

  	
   

  	
   

  
	
  Annex C
  (Section 11.9)

  	
   

  	
  - Notice Addresses

  
	
   

  	
   

  	
   

  
	
  Annex D (from Annex A –

  	
   

  	
  - Commitments as of
  Closing Date

  
	
  Commitments definition)

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Annex E (from Annex A –

  	
   

  	
  - Assessed Equipment

  
	
  Assessed Equipment

  	
   

  	
   

  
	
  definition)

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Exhibit 1.2(a) 

  	
   

  	
  - Form of Notice of
  Revolving Credit Advance/Election of BA Periods

  
	
   

  	
   

  	
   

  
	
  Exhibit 1.2(b)

  	
   

  	
  - Form of Revolving
  Note

  
	
   

  	
   

  	
   

  
	
  Exhibit 1.2(d)

  	
   

  	
  - Form of Notice of
  Extension

  
	
   

  	
   

  	
   

  
	
  Exhibit 1.4(b)

  	
   

  	
  - Form of Term Loan B
  Note

  
	
   

  	
   

  	
   

  
	
  Exhibit 3.4(b)

  	
   

  	
  - Form of Notice of
  Rollover or Conversion

  
	
   

  	
   

  	
   

  
	
  Exhibit 5.1(b)

  	
   

  	
  - Form of Borrowing
  Base Certificate

  
	
   

  	
   

  	
   

  
	
  Exhibit 6.8(a)

  	
   

  	
  - Form of
  Environmental Certificate

  
	
   

  	
   

  	
   

  
	
  Exhibit 11.1(b)

  	
   

  	
  - Form of Assignment
  Agreement

  
	
   

  	
   

  	
   

  
	
  Schedule 5.4

  	
   

  	
  - Insurance

  
	
   

  	
   

  	
   

  
	
  Disclosure Schedule 4.1

  	
   

  	
  - Type of Entity;
  Jurisdiction of Organization

  
	
   

  	
   

  	
   

  
	
  Disclosure Schedule 4.2

  	
   

  	
  - Executive Offices,
  Collateral Locations

  
	
   

  	
   

  	
   

  
	
  Disclosure Schedule 4.4(a)

  	
   

  	
  - Financial Statements

  
	
   

  	
   

  	
   

  
	
  Disclosure Schedule 4.4(b)

  	
   

  	
  - Projections

  
	
   

  	
   

  	
   

  
	
  Disclosure Schedule 4.7

  	
   

  	
  - Labour Matters

  
	
   

  	
   

  	
   

  
	
  Disclosure Schedule 4.8

  	
   

  	
  - Ventures, Subsidiaries
  and Affiliates; Outstanding Stock

  
	
   

  	
   

  	
   

  
	
  Disclosure Schedule 4.10

  	
   

  	
  - Tax Matters

  



 


1

















 


	
  Disclosure Schedule 4.11

  	
   

  	
  - Litigation

  
	
   

  	
   

  	
   

  
	
  Disclosure Schedule 4.12

  	
   

  	
  - Pension and Benefit
  Plans

  
	
   

  	
   

  	
   

  
	
  Disclosure Schedule 4.13

  	
   

  	
  - Brokers

  
	
   

  	
   

  	
   

  
	
  Disclosure Schedule 4.14

  	
   

  	
  - Intellectual Property

  
	
   

  	
   

  	
   

  
	
  Disclosure Schedule 4.16

  	
   

  	
  - Hazardous Materials

  
	
   

  	
   

  	
   

  
	
  Disclosure Schedule 4.17

  	
   

  	
  - Insurance

  
	
   

  	
   

  	
   

  
	
  Disclosure Schedule 4.18

  	
   

  	
  - Deposit and Disbursement
  Accounts

  
	
   

  	
   

  	
   

  
	
  Disclosure Schedule 4.19

  	
   

  	
  - Government Contracts

  
	
   

  	
   

  	
   

  
	
  Disclosure Schedule 4.21

  	
   

  	
  - Bonds; Patent,
  Trademark, Industrial Design Licenses

  
	
   

  	
   

  	
   

  
	
  Disclosure Schedule 6.1

  	
   

  	
  - Trade Names

  
	
   

  	
   

  	
   

  
	
  Disclosure Schedule 7.4

  	
   

  	
  - Indebtedness

  
	
   

  	
   

  	
   

  
	
  Disclosure Schedule 7.5(a)

  	
   

  	
  - Transactions with
  Affiliates

  
	
   

  	
   

  	
   

  
	
  Disclosure Schedule 7.5(b)

  	
   

  	
  - Transactions with
  Employees

  
	
   

  	
   

  	
   

  
	
  Disclosure Schedule 7.7

  	
   

  	
  - Guaranteed Indebtedness

  
	
   

  	
   

  	
   

  
	
  Disclosure Schedule 7.8

  	
   

  	
  - Existing Liens

  



 


2
















 


This Amended and Restated
Credit Agreement (this “Agreement”),
dated as of December 31, 2008, among EVEREADY
ENERGY SERVICES CORP., a corporation incorporated under the laws of
Alberta (“Borrower”), the other
Credit Parties signatory hereto, and GE
CANADA ASSET FINANCING HOLDING COMPANY (“GE Canada” or “Agent”),
for itself as Lender and Agent, [The names of
Lenders have been omitted from the SEDAR version of this Agreement in
accordance with National Instrument 51-102 in order to comply with the
confidentiality requirements of Section 13.13 of this Agreement],
as Lenders, and the other Lenders signatory hereto from time to time.


 


RECITALS:


 


WHEREAS, Borrower and
the Lenders are parties to an amended and restated credit agreement dated as of
April 25, 2007, as amended by a first amending agreement dated as of February 15,
2008 and a second amending agreement dated as of April 24, 2008 (the “Existing Credit Agreement”); and


 


WHEREAS, Borrower has
requested and the Lenders have agreed to amend and restate the Existing Credit
Agreement on the terms and conditions herein set forth, and GE Canada has
agreed to act as Agent for the Lenders under the Credit Facilities all on the
terms and conditions and for the purposes set out in this Agreement; and


 


WHEREAS, Borrower has
agreed to secure all of its obligations under the Loan Documents by granting to
Agent, for the benefit of Agent and other Lenders, a security interest in and
hypothecs and lien upon, all of its existing and after-acquired personal
property; and


 


WHEREAS, capitalized
terms used in this Agreement shall have the meanings ascribed to them in Annex
A and, for purposes of this Agreement and the other Loan Documents, the rules of
construction set forth in Annex A shall govern. All Annexes, Disclosure Schedules,
Exhibits and other attachments (collectively, “Appendices”) hereto, or expressly identified to this
Agreement, are incorporated herein by reference, and taken together with this
Agreement, shall constitute but a single agreement. These Recitals shall be
construed as part of the Agreement.


 


NOW
THEREFORE, in consideration of the premises and the mutual
covenants hereinafter contained, and for other good and valuable consideration,
the parties hereto agree as follows:


 


ARTICLE I


AMOUNT AND TERMS OF CREDIT


 


1.1          Amendment
and Restatement


 


(a)                                  On the date on which all of
the conditions set forth in Section 2.1 have been satisfied (or waived in
writing by the Requisite Lenders in accordance with Article XIII):


 


(i)                                     The Existing Credit
Agreement shall be and is hereby amended and restated in the form of this
Agreement; and


 

















 


(ii)                                  All Loans (as defined in the
Existing Credit Agreement) and other amounts outstanding under the Existing
Credit Agreement prior to the date hereof shall continue to be outstanding under
this Agreement and shall be deemed to be Loans and other Obligations owing by
the Borrower to the Lenders under this Agreement. The Lenders hereby agree to
take all steps and actions and execute and deliver all agreements, instruments
and other documents as may be required by the Agent (including the assignment
of interests in, or the purchase or participations in, such outstanding Loans)
to give effect to the foregoing and to ensure that the aggregate Obligations
owing to each Lender are outstanding in proportion to each Lender’s Rateable
Portion of all outstanding Obligations after giving effect to the foregoing.


 


(b)                                 Notwithstanding the
foregoing or any other term hereof, all of the covenants, representations and
warranties on the part of the Borrower under the Existing Credit Agreement and
all of the claims and causes of action arising against the Borrower in
connection therewith, in respect of all matters, events, circumstances and
obligations arising or existing prior to the date hereof shall continue,
survive and shall not be merged in the execution of this Agreement or any other
Loan Documents or any other Advance or provision of any Loan hereunder.


 


(c)                                  References herein to the
“date hereof” or similar expressions shall be and shall be deemed to be the
date of the execution and delivery hereof, being December 31, 2008.


 


1.2          Revolving
Credit Facility


 


(a)                                  Extendible Revolving Credit
Facility. Subject to the terms and conditions hereof, each
Revolving Lender agrees to make available to Borrower from time to time until
the Commitment Termination Date its Pro-Rata Share of advances in Cdn.$ under
the Revolving Loan Commitment (each, a “Revolving
Credit Advance”). The Pro-Rata Share of the Revolving Loan of any
Revolving Lender shall not at any time exceed its separate Revolving Loan
Commitment. The obligation of each Revolving Lender hereunder shall be several
and not joint. Until the Commitment Termination Date, Borrower may from time to
time borrow, repay and reborrow under this Section 1.2(a); provided, that
the Canadian Dollar amount of any Revolving Credit Advance to be made at any
time shall not exceed Borrowing Availability at such time. Each Revolving
Credit Advance shall be made on notice by Borrower to the Agent and shall be in
principal amounts of not less than $1,000,000 (or, in the case of Revolving
Credit Advances by way of Bankers’ Acceptances, $5,000,000) and in multiples of
$100,000 for any amounts in excess thereof. Any such notice must be given no
later than 11:00 a.m. (Toronto time) on the date which is two (2) Business
Days prior to the proposed Revolving Credit Advance. Each such notice (a “Notice of Revolving Credit Advance/Election of BA
Periods”) must be given in writing (by telecopy or


 


2

















 


overnight courier) substantially in the form of Exhibit 1.2(a),
and shall include the information required in such Exhibit and such other
information as may be required by Agent.


 


(b)                                 Promissory Note. Except as
provided in Section 1.11, Borrower shall execute and deliver to each
Revolving Lender a note to evidence the Revolving Loan Commitment of such
Revolving Lender. Each note shall be in the principal amount of the Revolving
Loan Commitment of the applicable Revolving Lender, dated April 25, 2007
and substantially in the form of Exhibit 1.2(b) (each, a “Revolving Note” and, collectively, the “Revolving Notes”). Each Revolving Note
shall represent the obligation of Borrower to pay the amount of the applicable
Revolving Lender’s Revolving Loan Commitment or, if less, such Revolving
Lender’s Pro Rata Share of the aggregate unpaid principal amount of all
Revolving Credit Advances to Borrower together with interest thereon as
prescribed in Section 1.7.


 


(c)                                  Extension of Commitment
Termination Date.


 


(i)                                     End of First Commitment
Termination Date.


 


Subject to paragraph 1.2(c)(ii) below, the “Commitment Termination Date” will be April 24,
2009.


 


(ii)                                  Request for Extension.


 


(A)                              The Borrower may, provided
no Default or Event of Default has occurred and is continuing, request an
extension of the Revolving Period at such time not more than 90 days and not
less than 60 days prior to the then current Commitment Termination Date. Such
request shall be made by the Borrower by delivering to the Agent an executed
notice of extension in the form of Exhibit 1.2(c) (each such notice,
a “Notice of Extension”), and, if
not previously delivered, the most current financial statements required to be
delivered by it hereunder. The Agent shall, within two (2) Business Days
of receipt thereof notify each Revolving Lender of such Notice of Extension and
each such Revolving Lender shall notify the Agent as to whether or not it
agrees (in its sole discretion) to such request no later than 30 days following
delivery to the Lenders of the Notice of Extension (the “Notification Date”); provided that, if a
Revolving Lender does not so notify the Agent on or prior to the Notification
Date, such Revolving Lender shall be deemed to have elected not to agree to
such request for extension of the Revolving Period.


 


3

















 


(B)                                If the Borrower fails to
make a request for an extension of the Revolving Period within the time
provided above, the then current Revolving Period will not be extended.


 


(C)                                To the extent Revolving
Lenders holding less than 75% of the Revolving Loan Commitment agree to such
request for an extension of the Revolving Period, the Revolving Period will not
be extended and the Borrower shall have the option to either: (i) elect to
have the undrawn portion of the Revolving Loan cancelled, and, subject to the
Borrower’s continued compliance with the terms and conditions of the Revolving
Loan, the then current outstanding amount of the Revolving Loan shall convert
to a Term Loan and be amortized as outlined in Section 1.2(e)(ii) or (ii) repay
the entire principal amount of the Revolving Loan then outstanding without
payment of the Fee required by Section 1.8(c).


 


(D)                               If Lenders holding 75% or
more of the Revolving Loan Commitment agree to such request for an extension of
the Revolving Period, the Agent shall forthwith deliver to the Borrower a
Notice of Acceptance. Upon delivery of the Notice of Acceptance to the Borrower
by the Agent, the then current Revolving Period shall be extended for 364 days
from the Commitment Termination Date. If any Revolving Lender that receives
notification from the Agent that the Borrower has delivered a Notice of
Extension, elects not to, or is deemed not to, deliver a Notice of Acceptance
(each a “Non-Agreeing Lender”),
the Agent shall forthwith so advise each of the other Revolving Lenders which
do deliver a Notice of Acceptance and each such Revolving Lender shall have the
right (but not the obligation) to purchase the Individual Revolving Loan
Commitment Amount of each such Non-Agreeing Lender (collectively, the “Non-Agreeing Lender Commitment Amount”) for
a purchase price in an amount equal to the aggregate principal amount of the
Revolving Credit Advances owing to such Non-Agreeing Lenders under the Revolving
Loan, together with accrued interest thereon to the date of payment of such
principal amount and all other Indebtedness payable by the Borrower to such
Non-Agreeing Lenders under this Agreement and the other Loan Documents
(including all losses, costs and expenses suffered or incurred by the
Non-Agreeing Lenders as a result of complying with this Section 1.2(c)(ii)(D)).
Each of the other Revolving Lenders wishing to exercise its rights to purchase
the Non-Agreeing Lender Commitment Amount (a “Purchasing
Lender”) shall so notify the Borrower, the Agent and each of the
other Revolving Lenders in writing, and such Purchasing Lender shall thereupon
be obligated to purchase not


 


4

















 


less than 15 days prior to the last day of the then current Revolving
Period, or such other time period as the Borrower, the Agent, the Purchasing
Lender and any Non-Agreeing Lender may agree, an amount equal to the
Non-Agreeing Lender Commitment Amount multiplied by such Purchasing Lender’s
Rateable Portion of the Revolving Loan Commitment over the aggregate of all
Purchasing Lenders’ Rateable Portion of the Revolving Loan Commitment, or as
otherwise agreed to by the Borrower and all Purchasing Lenders. The
Non-Agreeing Lenders, the Purchasing Lenders, the Agent, the Borrower and each
of the other Revolving Lenders, if any, shall forthwith duly execute and
deliver any necessary documentation to give effect to such purchase, whereupon
the Non-Agreeing Lenders shall, as of the effective date thereof, be released
from their respective obligations to the Borrower, as they relate to the
Revolving Loan, hereunder and under the other Documents arising subsequent to
such date. If the Non-Agreeing Lender Commitment Amount is not purchased by an existing
Revolving Lender, the Borrower may arrange for a replacement lender or lenders
(each, a “Replacement Revolving Lender”)
to purchase the Non-Agreeing Lender Commitment Amount, provided that such
Replacement Revolving Lender is deemed acceptable by the Agent. The Fee
required by Section 1.8(c) shall not be applicable to any such
purchase from a Non-Agreeing Lender.


 


(E)                                 If Lenders holding 75% or
more of the Revolving Loan Commitment agree to provide an extension of the then
current Revolving Period date, but none of the Revolving Lenders agree to
purchase all of the Non-Agreeing Lender Commitment Amount from the Non-Agreeing
Lenders, the undrawn portion of the Non-Agreeing Lender Commitment Amount shall
be cancelled as at the end of the then current Revolving Period and the
Non-Agreeing Lender Commitment Amount shall convert from a revolving facility
to a non-revolving term facility as provided for in Section 1.2(d).


 


(F)                                 This Section 1.2(c) shall
apply from time to time to permit successive extensions of the Revolving Period
if and for so long as the Revolving Lenders have agreed in accordance with Section 1.2(c)(ii)


 


(d)                                 Conversion to Term Loan. The undrawn
portion of the Revolving Loan Commitment will be automatically cancelled at
5:00 p.m. (Toronto time) on the then current Commitment Termination Date
as applicable to any Non-Agreeing Lender or all the Revolving Lenders.
Effective at such time on such Commitment


 


5

















 


Termination
Date, and provided no Event of Default or Default exists and is continuing, the
applicable Revolving Loan Commitment will cease to be a revolving facility and
become a non-revolving term facility (a “Term
Loan”) having a term equal to the Term Period.


 


(e)           Repayment.


 


(i)                                     Revolving Nature. During a
Revolving Period, the Borrower may borrow, repay and re-borrow Revolving Credit
Advances, subject to the terms of this Agreement.


 


(ii)                                  Term Period. During the
Term Period as applicable to any Term Loan:


 


(A)                              in respect of the first 12
months of such Term Period, subject to the terms of this Agreement, only
interest shall be payable;


 


(B)                                in respect of
the final 24 months of such Term Period, in addition to interest, the remaining
unpaid principal amount of such Term Loan in equal monthly instalments equal to
41/6% of the total remaining
unpaid principal amount as at the beginning of such Term Period; and


 


(C)                                on the Maturity
Date, the Borrower shall pay the Lenders the remaining unpaid principal amount
of the applicable Term Loan (if any), together with all accrued and unpaid
interest thereon and all other amounts payable hereunder.


 


(f)                                    Reliance on Notices. Agent shall
be entitled to rely upon, and shall be fully protected in relying upon, any
Notice of Revolving Credit Advance/Election of BA Periods, Notice of Extension
or similar notice believed by Agent to be genuine. Agent may assume that each
Person executing and delivering any notice in accordance herewith was duly
authorized, unless the responsible individual acting thereon for Agent has
actual knowledge to the contrary.


 


1.3          Swing
Line Loans.


 


(a)                                  Availability. The Swing
Line Lender hereby creates a Swing Line Loan as a sub-facility to the Revolving
Loan. Borrower may obtain Swing Line Loans under the Revolving Loan by means of
Canadian Prime Rate loans on an overdraft basis (including by way of credit
card or electronic funds transfer settlement obligations) or by delivering a
duly executed Notice of Revolving Credit Advance/Election of BA Periods to the
Swing Line Lender not later than noon (Toronto time) on the proposed date of
drawdown providing for the nature of the advance, including, if acceptable to
the Swing Line Lender, in its sole discretion, letters of credit up to a
sublimit of $5,000,000.


 


6

















 


Swing
Line Loans shall be made solely by the Swing Line Lender, without assignment to
or participation by the other Revolving Lenders (except as provided in this Section 1.3).  The making of each Swing Line Loan shall
constitute an advance hereunder and shall reduce the availability of the
Revolving Loan by the amount of such Swing Line Loan.


 


(b)                                 Individual Limits. At no time
shall (i) the aggregate principal amount of all Swing Line Loans owing to
the Swing Line Lender exceed the Swing Line Loan Limit, provided that the Swing
Line Lender may, provided that it has the contractual right to set-off and
consolidate account balances in all accounts of the Credit Parties, quantify
the outstanding Swing Line Loans based on net amounts among such accounts with
the Swing Line Lender, or (ii) the aggregate principal amount of all Swing
Line Loans owing to the Swing Line Lender plus such Revolving Lender’s portion
of the aggregate principal amount of all Revolving Loans exceed such Revolving
Lender’s Individual Revolving Loan Commitment Amount; provided that Agent may,
in its discretion, acting reasonably, adjust each Revolving Lender’s (including
the Swing Line Lender’s) Rateable Portion of Revolving Loans in accordance with
its customary practice if and to the extent required to ensure that, subject to
Section 1.3(g), any undrawn availability of Swing Line Loans or Revolving
Loans, as applicable, is capable of being fully drawn.


 


(c)                                  Repayment. Except for
any letters of credit drawn thereunder, each Swing Line Loan shall be repaid by
Borrower (or converted into a Revolving Loan in accordance with Section 1.3(g))
within 30 days after the relevant date of drawdown. No notice of repayment
shall be required to be given by Borrower in respect of any such repayment of
any Swing Line Loan.


 


(d)                                 Mandatory Repayment. If Borrower
requests a Revolving Loan and the Swing Line Lender’s Rateable Portion of such
Revolving Loan would cause its Rateable Portion of all Revolving Loans then
outstanding together with the aggregate principal amount of all Swing Line
Loans to exceed the Swing Line Lender’s Individual Revolving Loan Commitment,
then Borrower shall be required to repay such Swing Line Loans (or to convert
some into a Revolving Loan in accordance with Section 1.3(g)) to the
extent of such excess, on or before the requested date of such Revolving Loan.


 


(e)                                  Prepayments. The Borrower
may make prepayments of Swing Line Loans at any time and from time to time
without notice or penalty.


 


(f)                                    Sole Account. All interest
payments, acceptance fees and principal repayments of or in respect of Swing
Line Loans shall be solely for the account of the Swing Line Lender. Subject to
Section 1.3(g), all costs and expenses relating to the Swing Line Loans
shall be solely for the account of the Swing Line Lender.


 


7

















 


(g)                                 Conversion to Revolving Loan.
Notwithstanding anything to the contrary herein contained, (i) at any time
at the option of Borrower or (ii) if an Event of Default occurs, the
Borrower shall give notice to the Swing Line Lender and Agent, (which notice
shall direct a conversion of such Swing Line Loan into a Revolving Loan and
shall specify the particulars of such Swing Line Loans), and Agent shall
forthwith provide a copy of such notice to the other Revolving Lenders and,
effective on the effective date of such notice, Borrower shall be deemed to
have requested a conversion of such Swing Line Loan into a Revolving Loan and
in an amount sufficient to repay the relevant Swing Line Loan and accrued and
unpaid interest in respect thereof. Subject to the same notice period set out
in Section 1.2(a), such other Revolving Lenders shall disburse to Agent
for payment to the Swing Line Lender their respective portions of such amounts
and such amounts shall thereupon be deemed to have been advanced by such other
Lenders to Borrower and to constitute Revolving Loans. Such Revolving Loans
shall be deemed to be comprised of principal and accrued and unpaid interest in
the same proportions as the corresponding Swing Line Loans.


 


(h)                                 Unconditional Obligation. For
certainty, it is hereby acknowledged and agreed that, provided that no Default
or Event of Default had occurred and was continuing at the time the Swing Line
Lender advanced a Swing Line Loan, the Revolving Lenders shall be obligated to
disburse to Agent for payment to the Swing Line Lender their respective
portions of any Revolving Loans contemplated by Section 1.3(g) regardless
of:


 


(i)            whether a Default
or Event of Default has occurred or is then continuing;


 


(ii)           whether or not
Borrower has, in fact, actually requested such conversion; and


 


(iii)          whether or not the
obligations of the Revolving Lenders to make Revolving Loans has terminated.


 


(i)                                     Existing Letters of Credit. As at the
Closing Date, the Credit Parties have the following letters of credit issued by
the Swing Line Lender: $1,355,000 to Alberta Environment, $10,000 to B.C.
Environment and $860,226 to Alberta Energy and Utilities Board; these letters
of credit are deemed to be Obligations under the Swing Line Loan.


 


1.4          Term
Loan B Facility


 


(a)                                  Term Credit Facility. Subject to
the terms and conditions hereof, each Term Loan B Lender agrees to make
available to Borrower its Pro-Rata Share of the advance under the Term Loan B
Commitment (a “Term Loan B Advance”).
The Pro-Rata Share of any Term Loan B Lender shall not at any time exceed its
individual Term Loan B Commitment. The obligations of each Term Loan B Lender
hereunder shall be several and not joint. The Term Loan B Advance may be


 


8

















 


drawn
down by the Borrower by way of single drawdown on April 25, 2007 in
Canadian Dollars to a maximum of the Term Loan B Commitment as set out in Annex
D. Any portion of the Term Loan B Commitment Amount not drawn on the Closing
Date shall be immediately cancelled.


 


(b)                                 Promissory Note. Except as
provided in Section 1.11, Borrower shall execute and deliver to each Term
Loan B Lender a note to evidence the Term Loan B Commitment of such Term Loan B
Lender. Each note shall be in the principal amount of the Term Loan B Loan
Commitment of the applicable Term Loan B Lender, dated the Closing Date and
substantially in the form of Exhibit 1.4(b) (each, a “Term Loan B Note” and, collectively, the “Term Loan B Notes”). Each Term Loan B Note
shall represent the obligation of Borrower to pay the amount of the applicable
Term Loan B Lender’s Term Loan B Loan Commitment, together with interest
thereon as prescribed in Section 1.7.


 


(c)                                  Repayment. The Borrower
promises to repay the Term Loan B on the first day of each calendar month
commencing May 1, 2007 and ending May 1, 2012 in equal monthly
principal payments of $125,000 (based on amortization of 1% per annum and a
balloon payment at maturity) and on the Term Loan B Period Maturity Date all
amounts outstanding under the Term Loan B, together with interest thereon as
prescribed in Section 1.7.


 


(d)                                 Separate Loans. For
certainty, the Term B Loan is a separate loan from all other Obligations owing
under this Agreement.


 


1.5          Voluntary
Reductions; Mandatory Prepayments


 


(a)                                  Voluntary Reductions in
Revolving Loan Commitments. Borrower may at any time
on at least five (5) days’ prior written notice to Agent permanently
reduce the Revolving Loan Commitment; provided that (A) any such permanent
reductions shall be in a minimum amount of $1,000,000 and integral multiples of
$250,000 in excess of such amount, and (B) after giving effect to such
permanent reductions, Borrower shall comply with Section 1.5(c). Borrower
may at any time on at least ten (10) days’ prior written notice to Agent
terminate the Revolving Loan Commitment, provided, that upon such termination,
all Loans and other Obligations shall be immediately due and payable in full.
Any voluntary reduction or termination of the Revolving Loan Commitment must be
accompanied by payment of the Fee required by 1.8(c), if any. Upon any such
permanent reduction or termination of the Revolving Loan Commitment, Borrower’s
right to request Revolving Credit Advances, shall simultaneously be permanently
reduced or terminated, as the case may be. Bankers’ Acceptances cannot be
prepaid, but any outstanding BA may be funded by payment into an escrow account
as set out in Section 3.5.


 


(b)                                 Term Loan and Term Loan B
Voluntary Prepayments. Borrower may at any time on at least five (5) days’
prior written notice to Agent voluntarily prepay all or part


 


9

















 


of the Term Loans (on a pro-rata
basis) or Term Loan B; provided that any such prepayments shall be in a minimum
amount of $2,500,000 and integral multiples of $250,000 in excess of such
amount. Any such voluntary prepayment must be accompanied by the payment of the
Fee required by Section 1.8(c), if any, plus the payment of any funding
breakage costs in accordance with Section 1.12(b). Any partial prepayments
of the Term Loans or Term Loan B made by Borrower shall be applied to prepay
the scheduled instalments of the Term Loans or Term Loan B in inverse order of
maturity.


 


(c)                                  Mandatory Prepayments.


 


(i)                                     If at any time the aggregate
outstanding balance of the Revolving Loan exceeds the Revolving Loan
Commitment, Borrower shall immediately repay the aggregate outstanding
Revolving Loan to the extent required to eliminate such excess.


 


(ii)                                  If at any time the aggregate
outstanding balance of the Revolving Loan, Term Loan and Term Loan B exceeds
the Borrowing Base, Borrower shall make an offer (a “Borrowing Base Excess Offer”) to prepay the aggregate
outstanding Advances to the extent required to eliminate such excess.


 


(iii)                             Upon receipt by
any Credit Party of any cash proceeds of any asset disposition (including
condemnation proceeds and insurance proceeds resulting from the damage or
destruction of any asset), Borrower shall make an offer (an “Asset Sale Offer”) to prepay the Loans in
an amount equal to all proceeds, net of (A) commissions and other
reasonable and customary transaction costs, fees and expenses properly
attributable to such transaction and payable by Borrower in connection
therewith (in each case, paid to non-Affiliates), (B) goods and services
taxes, sales taxes and transfer taxes, as applicable, (C) amounts payable
to holders of senior Liens on such asset (to the extent such Liens constitute
Permitted Encumbrances hereunder), if any, and (D) an appropriate reserve
for income taxes in accordance with GAAP in connection therewith. Unless a
Default or Event of Default has occurred and is continuing, any prepayment as a
result of the acceptance of an Asset Sale Offer shall be applied in accordance
with subsection (iv) below. Borrower shall not be required to make an
Asset Sale Offer under this clause (ii) in respect of the following: (1) proceeds
of sales of Inventory in the ordinary course of business, provided that for greater
certainty any sale of goods and other personal property that are held by or on
behalf of any Credit Party for rent or lease shall not be considered a sale of
Inventory in the ordinary course of business for the purpose of this Section 1.5(c);
(2) asset disposition proceeds of less than $2,500,000 in the aggregate in
any Fiscal Year and (3) asset


 


10
















 


disposition
proceeds that are reinvested in Equipment within one hundred and eighty (180)
days following receipt thereof; provided that Borrower notifies Agent of its
intent to reinvest at the time such proceeds are received and when such
reinvestment occurs.


 


(iv)                              Borrower shall make the
Asset Sale Offer or Borrowing Base Excess Offer by delivering a written notice
of such offer to Agent as soon as practicable, and, in any event, no later than
three (3) Business Days, following receipt of any applicable proceeds. A
Lender may accept such Asset Sale Offer or Borrowing Base Excess Offer by
delivering a written notice of acceptance to Borrower within fifteen (15) days
after receipt of such offer.


 


(d)                                 Application of Certain
Mandatory Prepayments. Any prepayments made by Borrower pursuant
to Sections 1.5(c)(ii) and 1.5(c)(iii) above shall be applied as
follows: first, to Fees and reimbursable expenses of Agent then due and payable
pursuant to any of the Loan Documents; second, to interest then due and payable
on the Revolving Loan, Term Loan or Term Loan B, as applicable; third, as
applicable, to prepay the scheduled principal instalments of the Term Loan and
Term Loan B, on a pro rata basis
in inverse order of maturity, until such Term Loan and Term Loan B shall have
been prepaid in full; and fourth, to any outstanding principal balance of
Revolving Credit Advances until the same has been paid in full. If at the time
of any such mandatory prepayment a Default or Event of Default has occurred and
is continuing, then the prepayments shall be applied as set out in Section 1.10.
As BA’s cannot be prepaid, they will be funded by payment into an escrow
account as set out in Section 3.5.


 


(e)                                  No Implied Consent. Nothing in
this Section 1.5 shall be construed to constitute Agent’s or any Lender’s
consent to any transaction that is not permitted by other provisions of this
Agreement or the other Loan Documents.


 


1.6                               Use of Proceeds


 


Borrower shall utilize the proceeds of the Revolving Loan solely for:


 


(a)                                  refinancing the
existing indebtedness of the Consolidated Parties;


 


(b)                                 financing the
working capital of the Consolidated Parties; and


 


(c)                                  funding future
capital expenditures and Permitted Acquisitions of the Consolidated Parties.


 


Borrower shall utilize the proceeds of the Term Loan B solely for:


 


(d)                                 refinancing the
existing indebtedness of the Consolidated Parties; and


 


11

















 


(e)                                  funding future
Capital Expenditures and Permitted Acquisitions of the Consolidated Parties.


 


1.7                               Interest and Applicable Margins


 


(a)                                  The Borrower
shall pay to the Agent:


 


(i)                                   interest on the
Revolving Loan or Term Loan, for the rateable benefit of applicable Lenders in
arrears on each applicable Interest Payment Date, for Canadian Prime Rate Loans
at the applicable Canadian Prime Rate plus the applicable margin indicated in
the table below;


 


(ii)                                for Bankers’
Acceptances, a stamping fee based on the BA margin (the “BA Stamping Fee”) indicated on the table
below; and


 


(iii)                             on the Term
Loan B, for the rateable benefit of the applicable Lenders in arrears on each
Interest Payment Date, interest based on the BA Rate plus the applicable margin
based on the table below:


 


	
   

  	
   

  	
  (Funded
  Debt less Subordinated

  	
   

  	
  Financing
  Rate and Credit Spread

  	
   

  
	
  Level

  	
   

  	
  Debt) to
  EBITDA for prior

  rolling 4 quarters

  	
   

  	
  Canadian
  Prime

  Loan

  	
   

  	
  BA
  Margin

  	
   

  
	
  1

  	
   

  	
  < 1.50:1

  	
   

  	
  ·

  	
  %

  	
  ·

  	
  %

  
	
  2

  	
   

  	
  >1.50:1 but < 2.0:1

  	
   

  	
  ·

  	
  %

  	
  ·

  	
  %

  
	
  3

  	
   

  	
  >2.0:1 but < 2.50:1

  	
   

  	
  ·

  	
  %

  	
  ·

  	
  %

  



 


Certain information has been intentionally deleted from the
SEDAR version of this Agreement in accordance with section 12.2(3) of
National Instrument 51-102. The disclosure of this information to the general
public would be seriously prejudicial to the interests of Eveready Inc. or
would violate confidentiality provisions. Such information is not essential in
order to understand the material terms of this Agreement.


 


Except
as otherwise elected in a Notice of Revolving Credit Advance/Election of BA
Periods, Loans under Term Loan B will bear interest at the rate applicable to 1
month Bankers’ Acceptances and Loans under the Revolving Loan or Term Loan will
be Canadian Prime Rate Loans. Each such election shall be made by giving Agent
at least three (3) Business Days’ prior notice and Agent shall promptly
notify each Lender of its receipt of a Notice of Revolving Credit
Advance/Election of BA Periods and of the options selected therein. As of the
Closing Date, pricing will be based on Level 3. The pricing will be reset as of
each date falling three (3) Business Days after delivery of each
Compliance Certificate and pro forma
financials (to the extent that they take into account a Permitted Acquisition
that has closed or any other acquisition that the Lenders have consented to and
that has closed) and will be based on the financials delivered in such
documents. Any change to the BA Margin will apply proportionately to any
outstanding


 


12

















 


BA’s
based on the number of days remaining in the applicable BA Periods and will be
paid (or credited) on the date of the next following Revolving Credit Advance.


 


(b)                                 Extension to Next Business
Day. If any payment on a Loan becomes due and payable on a day other than
a Business Day, the maturity thereof will be extended to the next succeeding
Business Day and, with respect to payments of principal, interest thereon shall
be payable at the then applicable rate(s) during such extension.


 


(c)                                  Calculation of Rates. All
computations of Fees and interest in this Agreement or in any other Loan
Document shall be made by Agent on the basis of a 365-day or 366-day year, as
the case may be, in each case for the actual number of days occurring in the
period for which such interest and Fees are payable. Each determination by
Agent of an interest rate and Fees hereunder and under any other Loan Document
shall be presumptive evidence of the correctness of such rates and Fees.


 


(d)                                 Default Rate. So long as an
Event of Default has occurred and is continuing under Section 10.1(a),
10.1(h) or 10.1(i), or so long as any other Event of Default has occurred
and is continuing, and at the election of Agent (or upon the written request of
the Lenders confirmed by written notice from Agent to Borrower, the interest
rates applicable to the Loans shall, subject to the Interest Act (Canada), be
increased by two percentage points (2%) per annum above the rates of interest
or the rate of such Fees otherwise applicable hereunder unless the Lenders
elect to impose a smaller increase (the “Default
Rate”), and all outstanding Obligations shall bear interest at the
Default Rate applicable to such Obligations. Interest at the Default Rate shall
accrue from the initial date of such Event of Default until that Event of
Default is cured or waived and shall be payable upon demand. BA Stamping Fees
will be paid pursuant to Section 1.7(a)(ii).


 


(e)                                  Limitation on Interest. If any
provision of this Agreement or of any of the other Loan Documents would
obligate Borrower or any other Credit Party to make any payment of interest or
other amount payable to any Lender in an amount or calculated at a rate which
would be prohibited by law or would result in a receipt by such Lender of
interest at a criminal rate (as such terms are construed under the Criminal Code (Canada)) then,
notwithstanding such provisions, such amount or rate shall be deemed to have
been adjusted with retroactive effect to the maximum amount or rate of
interest, as the case may be, as would not be so prohibited by law or so result
in a receipt by such Lender of interest at a criminal rate, such adjustment to
be effected, to the extent necessary, as follows: (1) firstly, by reducing
the amount or rate of interest required to be paid to such Lender under this Section 1.7,
and (2) thereafter, by reducing any fees, commissions, premiums and other
amounts required to be paid to such Lender which would constitute “interest”
for purposes of Section 347 of the Criminal
Code (Canada). Notwithstanding the foregoing, and after giving
effect to all adjustments contemplated thereby, if a Lender shall have received
an amount in excess of the


 


13

















 


maximum
permitted by that section of the Criminal
Code (Canada), Borrower shall be entitled, by notice in writing to
such Lender, to obtain reimbursement from such Lender in an amount equal to
such excess and, pending such reimbursement, such amount shall be deemed to be
an amount payable by such Lender to Borrower. 
Any amount or rate of interest referred to in this Section 1.7(e) shall
be determined in accordance with generally accepted actuarial practices and
principles as an effective annual rate of interest over the term that the
applicable Loan remains outstanding on the assumption that any charges, fees or
expenses that fall within the meaning of “interest” (as defined in the Criminal Code (Canada)) shall, if they
relate to a specific period of time, be pro-rated over that period of time and
otherwise be pro-rated over the period from the Closing Date to the Termination
Date and, in the event of a dispute, a certificate of a Fellow of the Canadian
Institute of Actuaries appointed by Agent shall be conclusive for the purposes
of such determination.


 


(f)                                    Interest Act (Canada). For purposes
of disclosure pursuant to the Interest Act (Canada),
the annual rates of interest or fees to which the rates of interest or fees
provided in this Agreement and the other Loan Documents (and stated herein or
therein, as applicable, to be computed on the basis of a 360 day year or any
other period of time less than a calendar year) are equivalent are the rates so
determined multiplied by the actual number of days in the applicable calendar year
and divided by 360 or such other period of time, respectively.


 


1.8                               Fees


 


(a)                                  Borrower shall
pay to the Agent the Fees specified in the GE Fee Letter at the times specified
for payment therein.


 


(b)                                 As additional compensation
for the Revolving Lenders, Borrower shall pay to Agent, for the rateable
benefit of the Revolving Lenders, in arrears, on the first Business Day of each
month prior to the Commitment Termination Date and on the Commitment
Termination Date, a Fee for Borrower’s non use of available funds in an amount
equal to 0.25% per annum (calculated on the basis of a 365-day or 366-day year,
as the case may be,) multiplied by the difference between (x) the
Revolving Loan Commitment (as it may be reduced from time to time) and (y) the
average for the period of the daily closing balance of the Revolving Loan
outstanding during the period for which the such Fee is due.


 


(c)                                  If Borrower pays after
acceleration, or prepays all or any portion of any Term Loan or Term Loan B, or
reduces or terminates the Revolving Loan Commitment, whether voluntarily or
involuntarily and whether before or after acceleration of the Obligations or if
the Revolving Loan Commitment is otherwise terminated (including, for clarity,
pursuant to the terms of Section 1.2(d)), Borrower shall pay to Agent for
the benefit of the Lenders, as liquidated damages and compensation for the
costs of being prepared to make funds available hereunder an amount equal to
the Applicable Percentage (as defined below) multiplied by (i) the


 


14

















 


principal
amount of the Term Loan paid after acceleration or prepaid, (ii) the
principal amount of the Term Loan B paid after acceleration or prepaid, or (iii) the
amount of the reduction of the Revolving Loan Commitment, as applicable. As
used herein, the term “Applicable Percentage”
shall mean (x) three percent (3%), in the case of a prepayment on or prior
to April 25, 2008, (y) two percent (2%), in the case of a prepayment
after April 25, 2008 but on or prior to April 25, 2009, and (z) one
percent (1%), in the case of a prepayment after April 25, 2009 but on or
prior to April 25, 2010. The Credit Parties agree that the Applicable
Percentages are a reasonable calculation of the applicable Lenders’ lost
profits in view of the difficulties and impracticality of determining actual
damages resulting from an early termination of the Commitments. Notwithstanding
the foregoing, no prepayment fee shall be payable by Borrower (a) upon a
mandatory prepayment made pursuant to Section 1.5(c), or (b) in
connection with any revolving payment made in the ordinary course during the
Revolving Period or in connection with any scheduled payment made in respect of
the Term Loan or Term Loan B; provided that Borrower does not permanently
reduce or terminate the Revolving Loan Commitment, Term Loan or Term Loan B (as
applicable) upon any such prepayment.


 


(d)                                 In connection with each
extension of the Revolving Loan Commitment pursuant to Section 1.2(c), and
in addition to the fee contemplated by Section 1.8(b), Borrower shall pay
to Agent, for the rateable benefit of the Revolving Lenders providing such
extension on the date that would have been the Commitment Termination Date had
no extension occurred, a Fee in an amount equal to 0.25% (calculated on the
basis of a 365-day or 366-day year, as the case may be,) multiplied by the
Revolving Loan Commitment (as it may be reduced from time to time)


 


1.9                               Receipt of Payments


 


Borrower shall make each payment under this Agreement not later than
2:00 p.m. (Toronto time) on the day when due for value on that day to the
Collection Account. For purposes of computing interest and Fees and determining
Borrowing Availability as of any date, all payments shall be deemed received on
the Business Day on which immediately available funds therefor are received in
the Collection Account prior to 2:00 p.m. Toronto time. Payments received
after 2:00 p.m. Toronto time on any Business Day or on a day that is not a
Business Day shall be deemed to have been received on the following Business
Day. Without limiting Section 13.17, if Agent receives any payment from or
on behalf of a Credit Party in any currency other than the currency in which
the Obligation is denominated Agent may convert the payment (including the
proceeds of realization upon any collateral) into the currency in which such
Obligation is denominated at the Rate of Exchange (as such term is defined in Section 13.17(c)).


 


15

















 


1.10                        Application and Allocation of Payments on Default


 


Following the occurrence and during the continuance of any Default or
Event of Default, Borrower hereby irrevocably waives the right to direct the
application of any and all payments received from or on behalf of Borrower, and
Borrower hereby irrevocably agrees that Agent shall apply any and all such
payments against the Obligations in the following order: (1) to Fees and
reimbursable expenses of Agent then due and payable pursuant to any of the Loan
Documents; (2) to interest then due and payable on the Revolving Loan,
Term Loan or Term Loan B, as applicable; (3) as applicable, to prepay (i) the
Obligations under any Term Loans (ii) subject to Section 3.5 in the
case of Bankers’ Acceptances or BA Equivalent Loans, the Obligations under any
Revolving Loans, (iii) the Obligations under Term Loan B, and (iv) the
Obligations in respect of any Secured Rate Contracts; in each case on a pro
rata basis, in inverse order of maturity, until such Obligations shall have
been prepaid in full; and (4) to all other Obligations including expenses
of Lenders to the extent reimbursable under Section 13.3.


 


1.11                        Loan Account and Accounting


 


Agent shall maintain a loan account (the “Loan Account”) on its books to record: all Revolving Advances,
the Term Loan B Advances and, when applicable, the Term Loan, all payments made
by Borrower, and all other debits and credits as provided in this Agreement
with respect to the Loans or any other Obligations. All entries in the Loan
Account shall be made in accordance with Agent’s customary accounting practices
as in effect from time to time. The balance in the Loan Account, as recorded on
Agent’s most recent printout or other written statement, shall, absent manifest
error, be presumptive evidence of the amounts due and owing to Agent and
Lenders by Borrower; provided that any failure to so record or any error in so
recording shall not limit or otherwise affect Borrower’s duty to pay the
Obligations. Agent shall render to Borrower a monthly accounting of
transactions with respect to the Loans setting forth the balance of the Loan
Account for the immediately preceding month, such monthly accounting to be
provided within fifteen (15) days of the last day of the immediately preceding
month. Unless Borrower notifies Agent in writing of any objection to any such
accounting (specifically describing the basis for such objection), within
thirty (30) days after the date thereof, each and every such accounting shall
be presumptive evidence of all matters reflected therein. Only those items
expressly objected to in such notice shall be deemed to be disputed by
Borrower. Notwithstanding any provision herein contained to the contrary, any
Lender may elect (which election may be revoked) to dispense with the issuance
of Notes to that Lender and may rely on the Loan Account as evidence of the
amount of Obligations from time to time owing to it.


 


1.12                        Indemnity


 


(a)                                  Each Credit Party shall
indemnify and hold harmless the Agent and each Lender and their respective
Affiliates, and each such Person’s respective officers, directors, employees,
legal counsel, agents and representatives (each, an “Indemnified Person”), from and against any and all suits,
actions, proceedings,


 


16

















 


orders,
claims, damages, losses, liabilities and expenses (including reasonable legal
fees and disbursements, consultants fees and disbursements and other costs of
investigation or defense, including those incurred upon any appeal) that may be
instituted or asserted against or incurred by any such Indemnified Person as a
result of or in connection with credit having been extended, suspended or
terminated under this Agreement or the other Loan Documents and the
administration of such credit, and in connection with or arising out of the
transactions contemplated hereunder and thereunder and any actions or failures
to act in connection therewith including the taking of any enforcement actions
by Agent, including any and all Environmental Liabilities and legal costs and
expenses arising out of or incurred in connection with disputes between or
among any parties to any of the Loan Documents (collectively, “Indemnified Liabilities”); provided, that
no such Credit Party shall be liable for any indemnification to an Indemnified
Person to the extent that any such suit, action, proceeding, claim, damage,
loss, liability or expense results from that Indemnified Person’s gross
negligence or wilful misconduct. NO INDEMNIFIED PERSON SHALL BE RESPONSIBLE OR
LIABLE TO ANY OTHER PARTY TO ANY LOAN DOCUMENT, ANY SUCCESSOR, ASSIGNEE OR
THIRD PARTY BENEFICIARY OF SUCH PERSON OR ANY OTHER PERSON ASSERTING CLAIMS
DERIVATIVELY THROUGH SUCH PARTY, FOR INDIRECT, PUNITIVE, EXEMPLARY OR
CONSEQUENTIAL DAMAGES WHICH MAY BE ALLEGED AS A RESULT OF CREDIT HAVING
BEEN EXTENDED, SUSPENDED OR TERMINATED UNDER ANY LOAN DOCUMENT OR AS A RESULT
OF ANY OTHER TRANSACTION CONTEMPLATED HEREUNDER OR THEREUNDER.


 


(b)                                 To induce Lenders to provide
the Loans on the terms provided herein, if (i) any Loans are repaid in
whole or in part prior to the last day of any applicable BA Period (whether
that repayment is made pursuant to any provision of this Agreement or any other
Loan Document or occurs as a result of acceleration, by operation of law or
otherwise); (ii) Borrower shall default in payment when due of the
principal amount of or interest on any Loan; or (iii) Borrower shall fail
to make any prepayment of a Loan after Borrower has given a notice thereof in
accordance herewith, then Borrower shall indemnify and hold harmless each
Lender from and against all losses, costs and expenses resulting from or
arising from any of the foregoing. Such indemnification shall include any loss
(including loss of margin) or expense arising from the reemployment of funds
obtained by it or from fees payable to terminate deposits from which such funds
were obtained. For the purpose of calculating amounts payable to a Lender under
this subsection, each Lender shall be deemed to have actually funded its
relevant Loan through the purchase of a deposit bearing interest at the BA
Rate, in an amount equal to the amount of that Loan and having a maturity
comparable to the relevant BA Period; provided, that each Lender may fund each
of its Loans in any manner it sees fit, and the foregoing assumption shall be
utilized only for the calculation of amounts payable under this subsection for
Loans on which interest is calculated at


 


17

















 


the
BA Rate. This covenant shall survive the termination of this Agreement and the
payment of the Obligations and all other amounts payable hereunder.  As promptly as practicable under the
circumstances, each Lender shall provide Borrower with its written calculation
of all amounts payable pursuant to this Section 1.12(b), and such calculation
shall be binding on the parties hereto unless Borrower shall object in writing
within ten (10) Business Days of receipt thereof, specifying the basis for
such objection in detail.


 


1.13                        Access


 


Prior to the occurrence of an Event of Default, each Credit Party
shall, during normal business hours, from time to time upon two (2) Business
Days’ prior notice as frequently as Agent reasonably determines to be
appropriate: (a) provide Agent and any of its officers, employees and
agents access to its properties, facilities, advisors, officers and employees
of each Credit Party and to the Collateral, (b) permit Agent, and any of
its officers, employees and agents, to inspect, audit and make extracts from
any Credit Party’s books and records, and (c) permit Agent, and its
officers, employees and agents, to inspect, examine, review, evaluate and make
test verifications and counts of the Accounts, Inventory and other Collateral
of any Credit Party. If an Event of Default has occurred and is continuing, or
if access is necessary to preserve or protect the Collateral, as determined by
Agent, each such Credit Party shall provide such access to Agent and to each
Lender at all times and without advance notice. Furthermore, so long as any
Event of Default has occurred and is continuing, Borrower shall provide Agent
and each Lender with access to its suppliers and customers. Each Credit Party
shall make available to Agent and its counsel, reasonably promptly originals or
copies of all books and records that Agent may reasonably request. Each Credit
Party shall deliver any document or instrument necessary for Agent, as it may
from time to time request, to obtain records from any service bureau or other
Person that maintains records for such Credit Party, and shall maintain
duplicate records or supporting documentation on media, including computer
tapes and discs owned by such Credit Party. Agent will give Lenders at least
five (5) days’ prior written notice of regularly scheduled audits.
Representatives of the Lenders may accompany Agent’s representatives on
regularly scheduled audits at no charge to Borrower.


 


1.14                        Taxes


 


(a)                                  Any and all payments by or
on behalf of a Credit Party hereunder or under the Notes or any other Loan
Document shall be made, in accordance with this Section 1.14, free and
clear of and without deduction for any and all present or future Taxes
(excluding Taxes imposed on or measured by the net income or capital of any
Lender by the jurisdiction under the laws of which it is organized or is
resident or carries on business through a permanent establishment located
therein or any political subdivisions thereof). If a Credit Party shall be
required by law to deduct any Taxes from or in respect of any sum payable
hereunder or under the Notes or any other Loan Document (excluding Taxes
imposed on or measured by the net income or capital of any Lender by the
jurisdiction under the laws of


 


18

















 


which
it is organized or is resident or carries on business through a permanent
establishment located therein or any political subdivisions thereof), (i) the
sum payable shall be increased as much as shall be necessary so that, after
making all required withholdings and deductions (including withholdings and
deductions applicable to additional sums payable under this Section 1.14),
the Lenders, as applicable, receive an amount equal to the sum they would have
received had no such withholdings or deductions been made, (ii) the
applicable Credit Party shall make such withholdings and deductions, and (iii) the
applicable Credit Party shall pay the full amount withheld or deducted to the
relevant taxing or other authority in accordance with applicable law. Within
thirty (30) days after the date of any payment of Taxes, Borrower shall furnish
to Agent the original or a certified copy of a receipt evidencing payment
thereof.


 


(b)                                 In addition, each Credit
Party agrees to pay any present or future Taxes that arise from any payment
made under this Agreement or under any other Loan Document or from the
execution, sale, transfer, delivery or registration of, or otherwise with
respect to, this Agreement, the other Loan Documents and any other agreements
and instruments contemplated hereby or thereby (except for Taxes imposed on or
measured by the net income or capital of Agent or any other Lender by the
jurisdiction under the laws of which it is organized or is resident or carries
on business through a permanent establishment located therein or any political
subdivisions thereof). Each Lender agrees that, as promptly as reasonably
practicable after it becomes aware of any circumstances referred to above which
would result in additional payments under this Section 1.14, it shall
notify Borrower thereof.


 


(c)                                  Each Credit Party hereby
indemnifies Agent and each other Lender for the full amount of Taxes (excluding
Taxes imposed on or measured by the net income or capital of Agent or any other
Lender by the jurisdiction under the laws of which it is organized or is
resident or carries on business through a permanent establishment located
therein or any political subdivisions thereof but including any Taxes imposed
by any jurisdiction on amounts payable by such Credit Party under this Section 1.14)
paid by Agent or such other Lender, as appropriate, and any liability
(including penalties, interest and expenses) arising therefrom or with respect
thereto, whether or not such Taxes were correctly or legally asserted. Each
payment under this indemnification shall be made within ten (10) days
after Agent makes written demand therefor, for its own benefit or the benefit
of the affected Lender.


 


1.15                        Capital Adequacy; Increased Costs; Illegality


 


(a)                                  If any Lender shall have
determined that any law, treaty, governmental (or quasi governmental) rule,
regulation, guideline or order regarding capital adequacy, reserve requirements
or similar requirements or compliance by any Lender with any request or
directive regarding capital adequacy, reserve requirements or similar
requirements (whether or not having the force of law), in each case,


 


19

















 


adopted
after the Closing Date, from any central bank or other Governmental Authority
increases or would have the effect of increasing the amount of capital,
reserves or other funds required to be maintained by such Lender and thereby
reducing the rate of return on such Lender’s capital as a consequence of its
obligations hereunder, then Borrower shall from time to time upon demand by
such Lender (with a copy of such demand to Agent) pay to Agent, for the account
of such Lender, additional amounts sufficient to compensate such Lender for
such reduction. A certificate as to the amount of that reduction and showing
the basis of the computation thereof submitted by such Lender to Borrower and
to Agent shall be presumptive evidence of the matters set forth therein.


 


(b)                                 If, due to either (i) the
introduction of or any change in any law or regulation (or any change in the
interpretation thereof) or (ii) the compliance with any guideline or
request from any central bank or other Governmental Authority (whether or not
having the force of law), in each case adopted after the Closing Date, there
shall be any increase in the cost to any Lender of agreeing to make or making,
funding or maintaining any Loan, then Borrower shall from time to time, upon
demand by such Lender (with a copy of such demand to Agent), pay to Agent for
the account of such Lender additional amounts sufficient to compensate such
Lender for such increased cost. A certificate as to the amount of such
increased cost, submitted to Borrower and to Agent by such Lender, shall be
presumptive evidence of the matters set forth therein. Each Lender agrees that,
as promptly as practicable after it becomes aware of any circumstances referred
to above which would result in any such increased cost, the affected Lender
shall, to the extent not inconsistent with such Lender’s internal policies of
general application, use reasonable commercial efforts to minimize costs and
expenses incurred by it and payable to it by Borrower pursuant to this Section 1.15(b).


 


(c)                                  Within thirty (30) days
after receipt by Borrower of written notice and demand from any Lender (an “Affected Lender”) for payment of additional
amounts or increased costs as provided in Section 1.14(a), 1.15(a) or
1.15(b), Borrower may, at its option, notify Agent and such Affected Lender of
its intention to replace the Affected Lender. So long as no Default or Event of
Default has occurred and is continuing, Borrower, with the consent of Agent,
may obtain, at Borrower’s expense, a replacement Lender (“Replacement Lender”) for the Affected
Lender, which Replacement Lender must be reasonably satisfactory to Agent. If
Borrower obtains a Replacement Lender within ninety (90) days following notice
of its intention to do so, the Affected Lender must sell and assign its Loans
and Commitments to such Replacement Lender for an amount equal to the principal
balance of all Loans held by the Affected Lender and all accrued interest and
Fees with respect thereto through the date of such sale and such assignment
shall not require the payment of an assignment fee to Agent; provided, that
Borrower shall have reimbursed such Affected Lender for the additional amounts
or increased costs that it is entitled to receive under this Agreement through
the date of such sale and assignment. Notwithstanding the foregoing, Borrower
shall not have the


 


20
















 


right
to obtain a Replacement Lender if the Affected Lender rescinds its demand for
increased costs or additional amounts within 15 days following its receipt of
Borrower’s notice of intention to replace such Affected Lender. Furthermore, if
Borrower gives a notice of intention to replace and does not so replace such
Affected Lender within ninety (90) days thereafter, Borrower’s rights under
this Section 1.15(c) shall terminate with respect to such Affected
Lender and Borrower shall promptly pay all increased costs or additional
amounts demanded by such Affected Lender pursuant to Sections 1.14(a), 1.15(a) or
1.15(b).


 


1.16                        Currency Matters


 


Principal,
interest, reimbursement obligations, fees, and all other amounts payable under
this Agreement and the other Loan Documents to the Agent and the Lenders shall
be payable in the currency in which such Obligations are denominated.  Unless stated otherwise, all calculations,
comparisons, measurements or determinations under this Agreement shall be made
in Canadian Dollars.  For the purpose of
such calculations, comparisons, measurements or determinations, amounts
denominated in other currencies shall be converted in the Equivalent Amount of
Canadian Dollars on the date of calculation, comparison, measurement or determination.
In particular, without limitation, for purposes of valuations or computations
under Article III, Article VI, Article VII, and Article X
and calculating the Borrowing Base or Borrowing Availability, unless expressly
provided otherwise, where a reference is made to a dollar amount, the amount is
to be considered as the amount in Canadian Dollars and, therefore, each other
currency shall be converted into the Equivalent Amount thereof in Canadian
Dollars.


 


ARTICLE II


CONDITIONS PRECEDENT


 


2.1                               Conditions to the Amendment and Restatement


 


The amendment and restatement of the Existing Credit Agreement pursuant
to Section 1.1 shall not take effect, and no Lender shall be obligated to
make any Advance, or to take, fulfill, or perform any other action hereunder,
until the following conditions have been satisfied or provided for in a manner
reasonably satisfactory to Agent, or waived in writing by Agent and Requisite
Lenders:


 


(a)                                  Credit Agreement; Loan
Documents. This Agreement or counterparts hereof shall have
been duly executed by, and delivered to, Borrower, Agent and Lenders; and Agent
shall have received such documents, instruments, agreements and legal opinions
as Agent shall reasonably request in connection with the transactions
contemplated by this Agreement and the other Loan Documents, including, but not
limited to:


 


(i)                                   Appendices. All
Appendices to the Agreement, in form and substance satisfactory to Agent.


 


21

















 


(ii)                                Collateral
Documents. Duly executed originals of the Collateral
Documents or, as applicable in the Agent’s sole discretion, acknowledgments of
security, and all instruments, documents and agreements executed pursuant
thereto.


 


(iii)                             Acknowledgements. Duly executed
originals of the Acknowledgements, and all instruments, documents, and
agreements executed pursuant thereto.


 


(iv)                            Environmental
Indemnity. Duly executed originals of the Environmental
Indemnity Agreement.


 


(v)                               Material
Documents. Certified copies of the Material Documents, and
all instruments, documents and agreements executed pursuant thereto.


 


(vi)                            Insurance. Satisfactory
evidence that the insurance policies required by Section 6.4 are in full
force and effect, together with appropriate evidence showing loss payable and
additional insured clauses or endorsements, as reasonably requested by Agent,
in favour of Lenders.


 


(vii)                         Security
Interests, PPSA Filings and UCC.


 


(A)                              Evidence satisfactory to
Agent that Agent (for the benefit of itself and the Lenders) has a valid and perfected
first priority security interest (and valid and published first ranking
hypothec, if applicable) in the Collateral, including (i) such documents
duly executed by each Credit Party (including financing statements under the
PPSA and the UCC and other notice filings and applicable documents under the
laws of any jurisdiction with respect to the perfection and publication of
Liens) as Agent may request in order to perfect and publish its security
interests and hypothecs in the Collateral, and (ii) copies of search
reports listing all effective financing statements and other applicable notice
of lien filings that name any Credit Party as debtor (including its French form
of name), together with certificates of the applicable Governmental Authority
constituting evidence thereof, none of which shall cover the Collateral except
for Permitted Encumbrances.


 


(B)                                Evidence satisfactory to
Agent, acting reasonably, including copies, of all financing statements and
other applicable notices of Lien filings filed in favour of any Credit Party
with respect to each location, if any, at which equipment will be stored.


 


22

















 


(viii)       Credit Party
Guarantees. Guarantees or, as applicable in the Agent’s sole
discretion, acknowledgments of security executed by each of the Credit Parties,
other than the Borrower, in favour of the Lenders.


 


(ix)          Constating
Documents and Status. For each Credit Party, such Person’s (a) constating
documents and all amendments thereto, (b) certificates of compliance or
status (or applicable equivalent thereof) evidencing Borrower’s qualification
to conduct business in each jurisdiction where its ownership or lease of
property or the conduct of its business requires such qualification, each dated
a recent date prior to the Closing Date and certified by the applicable
authorized Governmental Authority.


 


(x)           Bylaws and
Resolutions. For each Credit Party, (a) such Person’s
bylaws or limited partnership agreements, as applicable, together with all
amendments thereto and (b) resolutions of such Person’s Board of
Directors, approving and authorizing the execution, delivery and performance of
the Loan Documents to which such Person is a party and the transactions to be
consummated in connection therewith, each certified as of the Closing Date by
such Person’s corporate secretary or an assistant secretary as being in full
force and effect without any modification or amendment.


 


(xi)          Incumbency
Certificates. For each Credit Party, signature and incumbency
certificates of the officers of each such Person executing any of the Loan
Documents, certified as of the Closing Date by such Person’s corporate
secretary or an assistant secretary as being true, accurate, correct and
complete.


 


(xii)         Opinions of
Counsel. Duly executed originals of opinions of Shea Nerland Calnan LLP,
counsel for the Credit Parties, together with any local counsel opinions
reasonably requested by Agent, each in form and substance reasonably
satisfactory to Agent and its counsel, dated the Closing Date, and each
accompanied by a letter addressed to such counsel from the Credit Parties,
authorizing and directing such counsel to address its opinion to the Lender or
to include in such opinion an express statement to the effect that the Lender
is authorized to rely on such opinion as though they were addressees.


 


(xiii)        Pledge
Agreements. Duly executed originals of each of the Pledge
Agreements accompanied by (as applicable) (a) share certificates
representing all of the outstanding Stock being pledged pursuant to such Pledge
Agreement and share transfer powers for such share certificates executed in
blank or if the constating documents of the issuer of such Stock contain a
private company restriction requiring that transfers of such Stock be approved
by the directors of such


 


23

















 


issuer (in contrast with the directors or shareholder(s) of such
issuer or solely the shareholder(s)) then, at the request of Agent, such share
certificates shall be registered in Agent’s or its nominee’s name when
delivered to Agent, and (b) the original intercompany notes and other
instruments evidencing Indebtedness being pledged pursuant to such Pledge
Agreement, duly endorsed in blank.


 


(xiv)        Fee Letter. Duly executed
originals of the GE Fee Letter.


 


(xv)         Officer’s
Certificate. Agent shall have received duly executed originals
of a certificate of an officer or director of Borrower, dated the Closing Date,
stating that, since December 31, 2007 (a) no event or condition has
occurred or is existing which could reasonably be expected to have a Material
Adverse Effect; (b) there has been no material adverse change in the
industry in which Borrower operates; (c) no Litigation has been commenced
which, if successful, would have a Material Adverse Effect or could challenge
any of the transactions contemplated by the Agreement and the other Loan
Documents; (d) except for Permitted Distributions, there have been no
Restricted Payments made by any Credit Party; and (e) before and after
giving effect to the transactions contemplated by the Credit Agreement, each
Credit Party will be Solvent, and (f) there has been no material increase
in liabilities, liquidated or contingent, and no material decrease in assets of
Borrower or any of its Subsidiaries.


 


(xvi)        Subordination
and Intercreditor Agreements. Agent and Lenders shall
have received any and all subordination and/or intercreditor agreements, all in
form and substance reasonably satisfactory to Agent, in its sole discretion, as
Agent shall have deemed necessary or appropriate with respect to any
Indebtedness of any Credit Party.


 


(xvii)       Other Documents.  Such other certificates, documents and
agreements respecting any Credit Party as Agent may reasonably request, each in
form and substance reasonably satisfactory to Agent.


 


(b)                                 Approvals. Agent shall
have received (i) satisfactory evidence that the Credit Parties have
obtained all required consents and approvals of all Persons including all
requisite Governmental Authorities, to the execution, delivery and performance
of this Agreement and the other Loan Documents or (ii) a certificate of an
officer of the Borrower in form and substance satisfactory to Agent, acting
reasonably, affirming that no such consents or approvals are required.


 


(c)                                  Payment of Fees. Borrower
shall have paid the Fees required to be paid on the Closing Date in the
respective amounts specified in Section 1.8 (including the Fees specified
in the GE Fee Letter), and shall have reimbursed Agent for all fees, costs and
expenses of closing presented as of the Closing Date.


 


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2.2                               Further Conditions to Each Advance


 


Except as otherwise expressly provided herein, neither Lender shall be
obligated to fund any Advance, if, as of the date thereof:


 


(a)                                  any representation or
warranty by any Credit Party contained herein or in any other Loan Document is
untrue or incorrect as of such date as determined by Agent;


 


(b)                                 any Default or Event of
Default has occurred and is continuing or would result after giving effect to
any Advance; or


 


(c)                                  after giving effect to any
Advance, the outstanding principal amount of the Revolving Loan would exceed
the lesser of (i) the Borrowing Base less outstanding Term Loans and Term
Loan B; and (ii) the Revolving Loan Commitment.


 


ARTICLE III


BANKERS’ ACCEPTANCES (REVOLVING CREDIT FACILITY)


 


3.1                               General


 


Each Bankers’ Acceptance draft tendered by the Borrower for acceptance
by a Lender will be in a form acceptable to the accepting Lenders, acting
reasonably, and the Revolving Credit Advance in respect thereof will be in a
principal amount of not less than $5,000,000 and in multiples of $100,000 for
any amounts in excess thereof, and will have terms of not less than 1 month and
not more than 6 months, unless otherwise agreed to by the accepting Lenders.


 


3.2                               Terms of Acceptance by the Lenders


 


(a)                                  Payment. The Borrower
will provide for payment to the Agent for the benefit of the Lenders of each
Bankers’ Acceptance at its maturity, either by payment of the face amount thereof
or through the utilization of a new Revolving Credit Advance (including by way
of a Rollover) in accordance with this Agreement, or through a combination
thereof. The Borrower waives presentment for payment of Bankers’ Acceptances by
the Lenders and will not claim from the applicable Lenders any days of grace
for the payment at maturity of Bankers’ Acceptances. Any amount owing by the
Borrower in respect of any Bankers’ Acceptance which is not paid at maturity in
accordance with this Agreement, will, as and from its maturity date, be deemed
to be outstanding as a Canadian Prime Rate Loan.


 


(b)                                 Power of Attorney. To facilitate
the procedures contemplated in this Agreement, the Borrower appoints each
Lender from time to time as the attorney-in-fact of the Borrower to execute,
endorse and deliver on behalf of the Borrower drafts or depository bills in the
form or forms prescribed by such Lender for Bankers’


 


25

















 


Acceptances
denominated in Canadian Dollars (each such executed draft or depository bill
which has not yet been accepted by a Lender being referred to as a “Draft”). 
Each Bankers’ Acceptance executed and delivered by a Lender on behalf of
the Borrower as provided for in this Section 3.2(b) will be as
binding upon the Borrower as if it had been executed and delivered by a duly
authorized officer of the Borrower.  The
foregoing appointment will cease to be effective three Banking Days following
receipt by the Lender in question of a notice from the Borrower revoking such
appointment provided that any such revocation will not affect Bankers’
Acceptances previously executed and delivered by a Lender pursuant to such
appointment.


 


(c)                                  Purchase of BAs. The Lenders
will purchase each Bankers’ Acceptance accepted by them.


 


(d)                                 Depository Bills. It is the
intention of the Parties that pursuant to the Depository Bills and Notes Act
(Canada) (“DBNA”), all Bankers’
Acceptances accepted by the Lenders under this Agreement will be issued in the
form of a “depository bill” (as defined in the DBNA), deposited with a “clearing
house” (as defined in the DBNA), including The Canadian Depository for
Securities Ltd. or its nominee CDS & Co. (“CDS”). In order to give effect to the foregoing, the Agent
will, subject to the approval of the Borrower and the Lenders, establish and
notify the Borrower and the Lenders of any additional procedures, consistent
with the terms of this Agreement, as are reasonably necessary to accomplish
such intention, including:


 


(i)            any instrument
held by the Agent for purposes of Bankers’ Acceptances will have marked
prominently and legibly on its face and within its text, at or before the time
of issue, the words “This is a depository bill subject to the Depository Bills
and Notes Act (Canada)”;


 


(ii)           any reference
to the authentication of the Bankers’ Acceptance will be removed; and


 


(iii)          any reference
to the “bearer” will be removed and such Bankers’ Acceptances will not be
marked with any words prohibiting negotiation, transfer or assignment of it or
of an interest in it.


 


3.3                               BA Equivalent Loans


 


In
lieu of accepting Drafts on the date of any Advance, or any date of Rollover or
Conversion, as applicable, each Non-BA Lender will make a BA Equivalent Loan.
Any BA Equivalent Loan will be made on the date of the relevant Advance, or any
date of Rollover or Conversion, as applicable, and its Maturity Date will be
the Maturity Date of the corresponding Bankers’ Acceptances. The amount of each
BA Equivalent Loan will be equal to the Discount Proceeds of the corresponding
Bankers’ Acceptances calculated


 


26

















 


on
the basis that the applicable Lenders were not Non-BA Lenders and were
therefore required to purchase such Bankers’ Acceptances.  On the Maturity Date of a BA Equivalent Loan,
the Borrower will pay to the Non-BA Lender an amount equal to the face amount
of the Bankers’ Acceptance which such Non-BA Lender would have accepted in lieu
of making a BA Equivalent Loan if it were not a Non-BA Lender. For greater
certainty, unless the context requires otherwise, all provisions of this
Agreement with respect to Bankers’ Acceptances will apply to BA Equivalent
Loans provided that BA Stamping Fees with respect to a BA Equivalent Loan will
be calculated on the basis of the amount with respect to such BA Equivalent
Loan which the Borrower is required to pay on the Maturity Date.


 


3.4                               General Mechanics


 


(a)                                  Bankers’ Acceptances. Unless such
Lender makes a BA Equivalent Loan pursuant to the terms of Section 3.3,
upon acceptance of a Bankers’ Acceptance by a Lender, such Lender will
purchase, or arrange for the purchase of, each Bankers’ Acceptance from the
Borrower at the Discount Rate applicable to such Lender for such Bankers’
Acceptance accepted by it and provide to the Agent the Discount Proceeds for
the account of the Borrower. The BA Stamping Fee payable by the Borrower to a
Lender in respect of each Bankers’ Acceptance by such Lender will be set off
against the Discount Proceeds payable by such Lender under this Section 3.4(a).


 


(b)                                 In anticipation of the
maturity of Bankers’ Acceptances, the Borrower shall, subject to and in
accordance with the requirements hereof, do one or a combination of the
following with respect to the aggregate face amount at maturity of all such
Banker’s Acceptances:


 


(i)                                     Affect a Rollover or
Conversion of such Bankers’ Acceptances in accordance with Sections 3.4(c) and
3.4(d) or 3.4(e), as applicable, below; or


 


(ii)                                  On the Maturity Date of the
maturing Bankers’ Acceptances, pay to the Agent for the account of the
applicable Lenders an amount equal to the aggregate face amount of such Bankers’
Acceptances.


 


(c)                                  Rollovers and Conversions. The Borrower
may from time to time affect a Rollover or Conversion as provided hereunder.
Each Rollover or Conversion shall be made on notice by Borrower to the Agent
and shall be in principal amounts of not less than $100,000 and in multiples of
$100,000 for any amounts in excess thereof. Any such notice must be given no
later than 11:00 a.m.(Toronto time) on the date which is two (2) Business
Days prior to the proposed Rollover or Conversion. Each such notice (a “Notice of Rollover or Conversion”) must be
given in writing (by telecopy or overnight courier) substantially in the form
of Exhibit 3.4(c), and shall include the information required in such Exhibit and
such other information as may be required by Agent.


 


27

















 


(d)                                 Rollovers. In the case
of a Rollover of maturing Bankers’ Acceptances, each Lender, in order to
satisfy the continuing liability of the Borrower to the Lender for the face
amount of the maturing Bankers’ Acceptances, will retain for its own account
the Net Proceeds of each new Bankers’ Acceptance issued by it in connection
with such Rollover and the Borrower will, on the Maturity Date of the maturing
Bankers’ Acceptances, pay to the Agent for the benefit of the Lenders an amount
equal to the difference between the face amount of the maturing Bankers’
Acceptances and the aggregate Net Proceeds of the new Bankers’ Acceptances.


 


(e)                                  Conversion from BA’s. In the case
of a Conversion of a Revolving Credit Advance by way of Bankers’ Acceptances
into a Canadian Prime Rate Loan, each Lender, in order to satisfy the liability
of the Borrower to each Lender for the face amount of the maturing Bankers’
Acceptances, will record the obligation of the Borrower to it as a Canadian
Prime Rate Loan, unless the Borrower provides for payment to the Agent for the
benefit of the Lenders of the face amount of the maturing Bankers’ Acceptance
in some other manner acceptable to the Lenders.


 


(f)                                    Conversion to BA’s. In the case
of a Conversion from a Canadian Prime Rate Loan into a Revolving Credit Advance
by way of Bankers’ Acceptances, each Lender, in order to satisfy the continuing
liability of the Borrower to each Lender for the amount of the Canadian Prime
Rate Loan being converted, will retain for its own account the Net Proceeds of
each new Bankers’ Acceptance issued by it in connection with such Conversion
and the Borrower will, on the date of issuance of the Bankers’ Acceptances pay
to the Agent for the benefit of the Lenders an amount equal to the difference
between the amount of the Canadian Prime Rate Loan being converted including
any accrued interest thereon, owing to the Lenders and the Net Proceeds of such
Bankers’ Acceptances.


 


3.5                               Escrowed Funds


 


Upon
the request of the Agent after the occurrence and during the continuance of an
Event of Default or in order to prepay a Bankers’ Acceptance in accordance with
the terms of this Agreement, the Borrower will forthwith pay to the Agent for
deposit into an escrow account maintained by and in the name of the Agent for
the benefit of the Lenders, an amount equal to the Lenders’ maximum potential
liability under then outstanding Bankers’ Acceptances (the “Escrow Funds”).  The Borrower expressly authorizes the Agent
to hold such Escrow Funds and apply them for set-off against future Obligations
owing by the Borrower to the applicable Lenders in respect of such Bankers’ Acceptances.  Pending such application, the Escrow Funds
will bear interest for the Borrower’s account at the rate payable to the Agent  by its account bank. If such Event of
Default is either waived or cured in compliance with the terms of this
Agreement, then the remaining Escrow Funds if any, together with any accrued
interest to the date of release, will be released to the Borrower.  The deposit of the Escrow Funds by the
Borrower with the Agent as herein provided will not operate as a repayment or
prepayment, as applicable, of the aggregate principal amount of the relevant
Bankers’


 


28

















 


Acceptance
until such time as the Escrow Funds are actually paid to the Lenders as a
repayment or prepayment, as applicable, of the outstanding principal mount
thereof.


 


3.6                               Market Disruption


 


If
at any time and from time to time, a Lender determines, in its reasonable
discretion, that there no longer exists an active market for Bankers’
Acceptances accepted by such Lender or the Discount Rate does not actually
reflect the discount rate which would be applicable to a sale of Bankers’
Acceptances in the market, then such Lender shall give notice thereof to the
Agent who shall so notify the Borrower and, the right of the Borrower to
request Bankers’ Acceptances or BA Equivalent Loans from such Lender shall be
suspended until the Agent determines that the circumstances causing the
suspension no longer exist, and so notifies the Borrower.  Any outstanding Notice of Revolving Credit Advance/Election
of BA Periods requesting an Advance by way of Bankers’ Acceptances or BA
Equivalent Loans shall be deemed to be a Notice of Revolving Credit
Advance/Election of BA Periods requesting an Advance by way of Canadian Prime
Rate Loans in the amount specified in the original Notice of Revolving Credit
Advance/Election of BA Periods.  Any
outstanding Notice of Rollover or Conversion requesting a Rollover of an
Advance by way of Bankers’ Acceptances or BA Equivalent Loans, shall be deemed
to be a Notice of Rollover or Conversion requesting a Conversion of such
Advance into an Advance by way of Canadian Prime Rate Loans.


 


ARTICLE IV


REPRESENTATIONS AND WARRANTIES


 


To induce Lenders to make
the Loans, each Credit Party executing this Agreement makes the following
representations and warranties to Agent and each Lender with respect to all
Credit Parties, each and all of which shall survive the execution and delivery
of this Agreement.


 


4.1                               Corporate Existence; Compliance with Law


 


Each
Credit Party (a) is a corporation, limited liability company, partnership,
trust or limited partnership duly organized, validly existing and in good
standing under the laws of its respective jurisdiction of incorporation or
organization set forth in Disclosure Schedule 4.1; (b) is duly qualified
to conduct business and is in good standing in each other jurisdiction where
its ownership or lease of property or the conduct of its business requires such
qualification, except where the failure to be so qualified would not result in
exposure to losses or liabilities which could reasonably be expected to have a
Material Adverse Effect; (c) has the requisite power and authority and the
legal right to own, pledge, mortgage, hypothecate or otherwise encumber and
operate its properties, to lease the property it operates under lease and to
conduct its business as now conducted and proposed to be conducted; (d) subject
to specific representations regarding Environmental Laws, has all licenses,
permits, consents or approvals from or by, and has made all material filings
with, and has given all notices to, all Governmental Authorities having
jurisdiction, to the extent required for such ownership, operation and conduct;
(e) is in compliance with its constating documents, bylaws or partnership agreement
or operating


 


29

















 


agreement,
as applicable; and (f) subject to specific representations set forth
herein regarding Environmental Laws, tax and other laws, is in compliance with
all applicable provisions of law, except where the failure to comply,
individually or in the aggregate, could not reasonably be expected to have a
Material Adverse Effect.


 


4.2                               Executive Offices, Collateral Locations


 


As of the Closing Date, the current location of each Credit Party’s
chief executive office, principal place of business and the warehouses and
premises at which any Collateral is located are set forth on Disclosure
Schedule 4.2, each of the locations that either (i) is used to store a
material amount of Collateral or (ii) is strategically important to such
Credit Party’s business is marked as a Key Location and none of such locations
has changed within four (4) months preceding the Closing Date.


 


4.3                               Corporate Power, Authorization, Enforceable Obligations


 


The execution, delivery and performance by each Credit Party of the
Loan Documents to which it is a party and the creation of all Liens provided
for therein: (a) are within such Person’s power; (b) have been duly
authorized by all necessary corporate, limited liability company, partnership,
trust or limited partnership action; (c) do not contravene any provision
of such Person’s constating documents, bylaws or partnership agreement or
operating agreement, as applicable; (d) do not violate any law or
regulation, or any order or decree of any court or Governmental Authority; (e) do
not conflict with or result in the breach or termination of, constitute a
default under or accelerate or permit the acceleration of any performance
required by, any indenture, mortgage, debenture, deed of trust, lease,
agreement or other instrument to which such Person is a party or by which such
Person or any of its property is bound; (f) do not result in the creation
or imposition of any Lien upon any of the property of such Person other than
those in favour of Agent, on behalf of itself and the Lenders, pursuant to the
Loan Documents; and (g) do not require the consent or approval of any
Governmental Authority or any other Person, except those referred to in Section 2.1(b),
all of which will have been duly obtained, made or complied with prior to the
Closing Date. On or prior to the Closing Date, each of the Loan Documents to
which a Credit Party is a party shall have been duly executed and delivered by
such Credit Party and each such Loan Document shall then constitute a legal,
valid and binding obligation of such Credit Party enforceable against it in
accordance with its terms.


 


4.4                               Financial Statements and Projections


 


Except for the Projections, all Financial Statements concerning the Credit
Parties that are referred to below have been prepared in accordance with GAAP
consistently applied throughout the periods covered (except as disclosed
therein and except, with respect to unaudited Financial Statements, for the
absence of footnotes and normal year-end audit adjustments) and present fairly
in all material respects the financial position of the Persons covered thereby
as at the dates thereof and the results of their operations and cash flows for
the periods then ended.


 


30
















 


(a)                                  Financial Statements. The unaudited
consolidated balance sheet of the Fund for the period ending September 30,
2008 (attached hereto as Disclosure Schedule 4.4(a)) and the related statements
of income and cash flows of the Fund and its Subsidiaries for the Fiscal Years
then ended, certified by the Chief Financial Officer, have been delivered on
the date hereof.


 


(b)                                 Projections. The
Projections delivered on the date hereof and attached hereto as Disclosure
Schedule 4.4(b) have been prepared by each Credit Party in light of the
past operations of its businesses and reflect projections for the 2009 year
period beginning on January 1, 2009 on a month-by-month basis for the
first year and on a year-by-year basis thereafter. The Projections are based
upon the same accounting principles as those used in the preparation of the
financial statements described above and the estimates and assumptions stated
therein, all of which each Credit Party believes to be reasonable and fair in
light of current conditions and current facts known to such Credit Party and,
as of the Closing Date, reflect such Credit Party’s good faith and reasonable
estimates of the future financial performance of such Credit Party, and of the
other information projected therein for the period set forth therein. The
Projections are not a guarantee of future performance, and actual results may
differ from the Projections.


 


4.5                               Material Adverse Effect


 


Between December 31, 2007 and the Closing Date, (a) no Credit
Party has incurred any obligations, contingent or non-contingent liabilities,
liabilities for Charges, long-term leases or unusual forward or long-term
commitments that are not reflected in the Financial Statements and that, alone
or in the aggregate, could reasonably be expected to have a Material Adverse
Effect, (b) no contract, lease or other agreement or instrument has been
entered into by any Credit Party or has become binding upon any Credit Party’s
assets and no law or regulation applicable to any Credit Party has been adopted
that has had or could reasonably be expected to have a Material Adverse Effect,
and (c) no Credit Party is in default and, to the best of each Credit
Party’s knowledge, no third party is in default under any material contract,
lease or other agreement or instrument, that alone or in the aggregate could
reasonably be expected to have a Material Adverse Effect. Since the date of the
last financials delivered in accordance with Section 5.1, no event has
occurred, that alone or together with other events, could reasonably be
expected to have a Material Adverse Effect.


 


4.6                               Ownership of Property; Liens


 


Each Credit Party has good and marketable title to, or valid leasehold
interests in, all of its personal property and assets. As of the Closing Date,
none of the properties and assets of any Credit Party are subject to any Liens
other than Permitted Encumbrances, and there are no facts, circumstances or
conditions known to any Credit Party that may result in any Liens (including
Liens arising under Environmental Laws) other than Permitted Encumbrances. Each
Credit Party has received all deeds, assignments, waivers, consents,
non-disturbance and attornment or similar agreements, bills of sale and other
documents,


 


31

















 


and
has duly effected all recordings, filings and other actions necessary to
establish, protect, perfect and publish such Credit Party’s right, title and
interest in and to all its other properties and assets.


 


4.7                               Labour Matters


 


Except as set forth on Disclosure Schedule 4.7, as of the Closing Date:
(a) no strikes or other material labour disputes against any Credit Party
are pending or, to any Credit Party’s knowledge, threatened; (b) hours
worked by and payment made to employees of each Credit Party comply with each
federal, provincial, local or foreign law applicable to such matters; (c) each
Credit Party has withheld all employee withholdings and has made all employer
contributions to be withheld and made by it pursuant to applicable law on
account of the Canada Pension plan, employment insurance and employee income
taxes; all payments due from any Credit Party for U.S. employee health and
welfare insurance have been paid or accrued as a liability on the books of such
Credit Party; (d) no Credit Party is a party to or bound by any collective
bargaining agreement, management agreement, consulting agreement, employment
agreement, bonus, restricted stock, stock option, or stock appreciation plan or
agreement or any similar plan, agreement or arrangement (and true and complete
copies of any agreements described on Disclosure Schedule 4.7 have been
delivered to Agent); (e) there is no organizing activity involving any
Credit Party pending or, to any Credit Party’s knowledge, threatened by any
labour union or group of employees; (f) there are no certification
applications or representative proceedings pending or, to any Credit Party’s
knowledge, threatened with any labour relations board, and no labour
organization or group of employees of any Credit Party has made a pending
demand for certificate; and (g) there are no material complaints or
charges against any Credit Party pending or, to the knowledge of any Credit
Party, threatened to be filed with any Governmental Authority or arbitrator
based on, arising out of, in connection with, or otherwise relating to the
employment or termination of employment by any Credit Party of any individual.


 


4.8                               Ventures, Subsidiaries and Affiliates; Outstanding Stock and Indebtedness


 


Except as set forth in Disclosure Schedule 4.8, as of the Closing Date,
no Credit Party has any Subsidiaries, is engaged in any joint venture or
partnership with any other Person, or is an Affiliate of any other Person. As
of the Closing Date, all of the issued and outstanding Stock of each Credit Party
is owned by each of the Stockholders and in the amounts set forth in Disclosure
Schedule 4.8. Except as set forth in Disclosure Schedule 4.8, there are no
outstanding rights to purchase, options, warrants or similar rights or
agreements pursuant to which any Credit Party may be required to issue, sell,
repurchase or redeem any of its Stock or other equity securities or any Stock
or other equity securities of its Subsidiaries. All outstanding Indebtedness
and Guaranteed Indebtedness of each Credit Party, as of the Closing Date
(except for the Obligations), is described in Section 7.4 (including
Disclosure Schedule 7.4).


 


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4.9                               Government Regulation


 


No Credit Party is subject to regulation under any Canadian federal law
or any provincial, local or foreign law that restricts or limits its ability to
incur Indebtedness or to perform its obligations hereunder. The making of the
Loans by Lenders to Borrower and the application of the proceeds thereof will
not violate any provision of any applicable statute or any rule, regulation,
order or policy of or issued by any securities commission, securities exchange
or other securities regulatory authority.


 


4.10                        Taxes


 


All federal, provincial and other material tax returns, reports and
statements, including information returns, required by any Governmental
Authority to be filed by any Credit Party have been filed with the appropriate
Governmental Authority, and all Charges have been paid prior to the date on
which any fine, penalty, interest or late charge may be added thereto for
non-payment thereof, excluding Charges or other amounts being contested in
accordance with Section 6.2(b). Proper and accurate amounts have been
withheld by each Credit Party from its respective employees for all periods in
full and complete compliance with all applicable federal, provincial, local and
foreign laws and such withholdings have been timely paid to the respective
Governmental Authorities. Disclosure Schedule 4.10 sets forth as of the Closing
Date in respect of each of the Credit Parties: (i) those taxation years
that have not yet been assessed by the CRA or the applicable provincial, local
or foreign Governmental Authorities, (ii) the taxation years that are
currently being audited by the CRA or any other applicable Governmental
Authority and (iii) any assessments or threatened assessments in
connection with such audit, or otherwise currently outstanding and (iv) the
most recent taxation year that an audit (done while such Credit Party was an
Affiliate of the Corporation or the Fund, as applicable,) by CRA or the
applicable provincial, local or foreign Governmental Authorities has been
completed. Except as described in Disclosure Schedule 4.10, as of the Closing
Date, no Credit Party has executed or filed with the CRA or any other
Governmental Authority any agreement or other document extending, or having the
effect of extending, the period for assessment or collection of any Charges.
None of the Credit Parties and their respective predecessors are liable for any
Charges: (a) under any agreement (including any tax sharing agreements) or
(b) to each Credit Party’s knowledge, as a transferee.


 


4.11                        No Litigation


 


No action, claim, lawsuit, demand, investigation or proceeding is now
pending or, to the knowledge of any Credit Party, threatened against any Credit
Party, before any Governmental Authority or before any arbitrator or panel of
arbitrators (collectively, “Litigation”),
(a) that challenges any Credit Party’s right or power to enter into or
perform any of its obligations under the Loan Documents to which it is a party,
or the validity or enforceability of any Loan Document or any action taken
thereunder, or (b) that has a reasonable risk of being determined
adversely to any Credit Party and that, if so determined, could reasonably be
expected to have a Material Adverse Effect. Except as


 


33

















 


set
forth on Disclosure Schedule 4.11, as of the Closing Date, there is no
Litigation pending or threatened that seeks damages in excess of $1,000,000 or
injunctive relief against, or alleges criminal misconduct of, any Credit Party.


 


4.12                        Canadian Pension Plan and Benefit Plans


 


As of the Closing Date, Disclosure Schedule 4.12 lists all Canadian
Benefit Plans and Canadian Pension Plans currently maintained or contributed to
by any Credit Party. The Canadian Pension Plans are duly registered under the
ITA and all other applicable laws which require registration. The Credit
Parties have complied with and performed all of their obligations in all
material respects under and in respect of the Canadian Pension Plans and
Canadian Benefit Plans under the terms thereof, any funding agreements and all
applicable laws (including any fiduciary, funding, investment and
administration obligations). All employer and employee payments, contributions
or premiums to be remitted, paid to or in respect of each Canadian Pension Plan
or Canadian Benefit Plan have been paid in a timely fashion in accordance with
the terms thereof, any funding agreement and all applicable laws. There have
been no improper withdrawals or applications of the assets of the Canadian
Pension Plans or the Canadian Benefit Plans. Except as set forth on Disclosure
Schedule 4.12, there are no outstanding disputes concerning the assets of the
Canadian Pension Plans or the Canadian Benefit Plans. Except as set forth on
Disclosure Schedule 4.12, each of the Canadian Pension Plans is fully funded on
a solvency basis (using actuarial methods and assumptions which are consistent
with the valuations last filed with the applicable Governmental Authorities and
which are consistent with generally accepted actuarial principles).


 


4.13                        Brokers


 


Except as set forth on Disclosure Schedule 4.13, no broker or finder
acting on behalf of any Credit Party or Affiliate thereof brought about the
obtaining, making or closing of the Loans or the Related Transactions, and no
Credit Party or Affiliate thereof has any obligation to any Person in respect
of any finder’s or brokerage fees in connection therewith.


 


4.14                        Intellectual Property


 


As of the Closing Date, each Credit Party owns or has rights to use all
Intellectual Property necessary to continue to conduct its business as now or
heretofore conducted by it or proposed to be conducted by it. Each Patent,
Trademark (excluding prints and labels on which they appear or have appeared),
Design, Copyright and License so owned or used by a Credit Party is listed,
together with application or registration numbers, as applicable, in Disclosure
Schedule 4.14. Each Credit Party conducts its business and affairs without
infringement of or interference with any Intellectual Property of any other
Person in any material respect. Except as set forth in Disclosure Schedule
4.14, no Credit Party is aware of any material infringement claim by any other
Person with respect to any Intellectual Property.


 


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4.15                        Full Disclosure


 


No information contained in this Agreement, any of the other Loan
Documents, any Projections, Financial Statements or Collateral Reports or other
written reports from time to time prepared by any Credit Party and delivered
hereunder or any written statement prepared by any Credit Party and furnished
by or on behalf of any Credit Party to Agent or any Lender pursuant to the
terms of this Agreement contains or will contain any untrue statement of a
material fact or omits or will omit to state a material fact necessary to make
the statements contained herein or therein not misleading in light of the
circumstances under which they were made. Projections from time to time
delivered hereunder are or will be based upon the estimates and assumptions
stated therein, all of which Borrower believed at the time of delivery to be
reasonable and fair in light of current conditions and current facts known to
Borrower as of such delivery date, and reflect Borrower’s good faith and
reasonable estimates of the future financial performance of Borrower and of the
other information projected therein for the period set forth therein. Such
Projections are not a guaranty of future performance and actual results may
differ from those set forth in such Projections. The Liens granted to Agent, on
behalf of the Lenders, pursuant to the Collateral Documents will at all times
be fully perfected first priority Liens in and to the Collateral described
therein, subject, as to priority, only to Permitted Encumbrances.


 


4.16                        Environmental Matters


 


(a)                                  Except as set forth in
Disclosure Schedule 4.16, as of the Closing Date: (i) all Real Estate
owned, occupied or controlled by the Credit Parties is free of the presence of
any Hazardous Material except for such presence that would not adversely impact
the value or marketability of such Real Estate, that is not in breach of Environmental
Laws, and that would not result in Environmental Liabilities that could
reasonably be expected to exceed $500,000 in the aggregate; (ii) no Credit
Party has caused or suffered to occur any Release of Hazardous Materials on,
at, in, under, above, to, from or about any of its Real Estate that could
reasonably be expected to result in Environmental Liabilities that exceed
$500,000 in the aggregate; (iii) the Credit Parties are, and have been, in
compliance with, all Environmental Laws, except where the failure to so comply
with such Environmental Laws would not result in Environmental Liabilities that
could reasonably be expected to exceed $500,000 in the aggregate; (iv) the
Credit Parties have obtained, and are in compliance with, all Environmental
Permits required by Environmental Laws for the operations of their respective
businesses as presently conducted or as proposed to be conducted, except where
the failure to so obtain or comply with such Environmental Permits would not
result in Environmental Liabilities that could reasonably be expected to exceed
$500,000 in the aggregate, and all such Environmental Permits are valid,
uncontested and in good standing; (v) no Credit Party is involved in
operations or knows of any facts, circumstances or conditions, including any
Releases of Hazardous Materials, that are likely to result in any Environmental
Liabilities of such Credit Party which


 


35

















 


could
reasonably be expected to exceed $500,000 in the aggregate; (vi) No Credit
Party is subject to any existing, pending, or has knowledge of any, threatened
Litigation arising under or related to any Environmental Laws, Environmental
Permits or Hazardous Material that seeks damages, penalties, fines, costs or
expenses in excess of $500,000 in the aggregate or injunctive relief against,
or that alleges criminal misconduct by, any Credit Party; (vii) no Credit
Party has knowledge of, nor has any Credit Party received notice of any actual,
pending or threatened investigations, claims, orders, suits, actions or
proceedings regarding the breach of any Environmental Laws or the provisions of
any Environmental Permits, or which may result in any Environmental Liability,
that could reasonably be expected to exceed $500,000 in the aggregate; and (viii) the
Credit Parties have provided to Agent copies of all existing environmental
reports, reviews and audits and all written information within their control
pertaining to actual or potential Environmental Liabilities, in each case
relating to any Credit Party.


 


(b)                                 The Assessed Equipment has
been maintained and operated in accordance with prudent industry standards and
all Environmental Laws and no Credit Party has knowledge of any fact,
circumstance or condition in respect of the Assessed Equipment or its
maintenance or operation that is likely to result in any Environmental
Liabilities that could reasonably be expected to exceed $500,000 in the
aggregate, or investigation, claim, order, suit, action or proceedings
regarding the breach of any Environmental Laws, or the provisions of any
Environmental Permits, that could reasonably be expected to result in
Environmental Liabilities that exceed $500,000 in the aggregate.


 


(c)                                  Each Credit Party hereby
acknowledges and agrees that Agent (i) is not now, and has not ever been,
in control of any Credit Party’s affairs, and (ii) does not have the
capacity through the provisions of the Loan Documents or otherwise to influence
any Credit Party’s conduct with respect to the ownership, operation or
management of any of its Real Estate or compliance with Environmental Laws or
Environmental Permits generally.


 


4.17                        Insurance Disclosure


 


Disclosure Schedule 4.17 lists all insurance policies of any nature
maintained, as of the Closing Date, for current occurrences by each Credit
Party, as well as a summary of the terms of each such policy.


 


4.18                        Deposit and Disbursement Accounts


 


Disclosure Schedule 4.18 lists all banks and other financial
institutions at which any Credit Party maintains lock boxes, deposit and/or
other accounts as of the Closing Date, including any disbursement accounts, and
such Schedule correctly identifies the name, address and telephone number of
each depository, the name in which the lock box or


 


36

















 


account
is held, a description of the purpose of the lock box or account, and the
complete lock box address or account number therefore.


 


4.19                        Government Contracts


 


Except as set forth in Disclosure Schedule 4.19, as of the Closing Date,
no Credit Party is a party to any contract or agreement with any Governmental
Authority and no Credit Party’s Accounts are subject to any of the requirements
or proceedings applicable to assignments of accounts under the Financial Administration Act (Canada), the
Federal Assignment of Claims Act of
1940 (31 U.S.C. Section 3727) or any similar provincial, local or foreign
law.


 


4.20                        Customer and Trade Relations


 


As of the Closing Date, there exists no actual or, to the knowledge of
any Credit Party, threatened termination or cancellation of, or any material
adverse modification or change in: the business relationship of any Credit
Party with any customer or group of customers whose purchases during the
preceding 12 months caused them to be ranked among the ten largest customers of
such Credit Party; or the business relationship of any Credit Party with any
supplier material to its operations.


 


4.21                        Bonding; Licenses


 


Except as set forth on Disclosure Schedule 4.21, as of April 25,
2007, no Credit Party is a party to or bound by any surety bond agreement or
bonding requirement with respect to products or services sold by it or any
trademark, patent or industrial design license agreement with respect to
products sold by it.


 


4.22                        Solvency


 


Both before and after giving effect to the amendment and restatement of
the Existing Credit Agreement pursuant to Section 1.1, (a) the
Revolving Loans and the Revolving Advances to be made or incurred on the
Closing Date or such other date as Advances requested hereunder are made or
incurred, (b) the disbursement of the proceeds of such Advances pursuant
to the instructions of Borrower, (c) the payment and accrual of all
transaction costs in connection with the foregoing, each Credit Party is and
will be Solvent.


 


ARTICLE V


FINANCIAL STATEMENTS AND INFORMATION


 


5.1                               Reports and Notices


 


(a)                                  The Corporation hereby
agrees that from and after the Closing Date and until the Termination Date, it
shall deliver, or cause to be delivered, to the Agent, or to the Agent and
Lenders, as required, the following Financial Statements, notices, Projections
and other information at the times and in the manner herein indicated:


 


37

















 


(i)                                     Quarterly Financials. To Agent and
Lenders, within forty-five (45) days after the end of each Fiscal Quarter for
and during the first three (3) Fiscal Quarters of each year and, except to
the extent otherwise delivered on an audited basis in accordance with Section 5.1(a)(iii),
within ninety (90) days after the end of each Fiscal Year, consolidated and
consolidating financial information regarding the Corporation and its
Subsidiaries certified by the Chief Financial Officer of the Corporation,
including (i) unaudited balance sheets as of the close of such Fiscal
Quarter and the related statements of income and cash flow for that portion of
the Fiscal Year ending as of the close of such Fiscal Quarter and (ii) unaudited
statements of income and cash flows for such Fiscal Quarter, in each case
setting forth in comparative form the figures for the corresponding period in
the prior year and the figures contained in the Projections for such Fiscal
Year, all prepared in accordance with GAAP (subject to normal year-end
adjustments). Such financial information shall be accompanied by (A) a
statement in reasonable detail (each, a “Compliance
Certificate”) showing the calculations used in determining
compliance with each of the Financial Covenants that is tested on a quarterly
basis and (B) the certification of the Chief Financial Officer of the
Corporation that (i) such financial information presents fairly in
accordance with GAAP (subject to normal year-end adjustments) the financial
position, results of operations and statements of cash flows of the Corporation
and its Subsidiaries on both a consolidated and consolidating basis, as at the
end of such Fiscal Quarter and for that portion of the Fiscal Year then ended, (ii) any
other information presented is true, correct and complete in all material
respects, (iii) all current and special payments required to have been
made pursuant to applicable law in respect of Canadian Pension Plans have been
made and (iv) that there was no Default or Event of Default in existence
as of such time or, if a Default or Event of Default has occurred and is
continuing, describing the nature thereof and all efforts undertaken to cure
such Default or Event of Default. In addition, the Corporation shall deliver to
Agent and Lenders, within forty-five (45) days after the end of each Fiscal
Quarter for and during the first three (3) Fiscal Quarters of each year
and within ninety (90) days after the end of each Fiscal Year, a management
discussion and analysis that includes a comparison to budget for that Fiscal
Quarter and a comparison of performance for that Fiscal Quarter or Fiscal Year,
as the case may be, to the corresponding period in the prior year.


 


(ii)                                  Operating Plan. To Agent and
Lenders, as soon as available, but not later than ninety (90) days after the
end of each Fiscal Year, an annual operating plan for the Consolidated Parties,
approved by the


 


38

















 


board
of directors of the Corporation, for the following Fiscal Year, which (i) includes
a statement of all of the material assumptions on which such plan is based, (ii) includes
monthly balance sheets and a monthly budget for the following year and (iii) integrates
sales, gross profits, operating expenses, operating profit, cash flow
projections and Borrowing Availability projections, all prepared on the same
basis and in similar detail as that on which operating results are reported
(and in the case of cash flow projections, representing management’s good faith
estimates of future financial performance based on historical performance), and
including plans for personnel, Capital Expenditures and facilities.


 


(iii)                               Annual Audited Financials. To Agent and
Lenders, within ninety (90) days after the end of each Fiscal Year, audited
Financial Statements for the Corporation and its Subsidiaries on a consolidated
and (unaudited) consolidating basis, consisting of balance sheets and
statements of income and retained earnings and cash flows, setting forth in
comparative form in each case the figures for the previous Fiscal Year, which
Financial Statements shall be prepared in accordance with GAAP and certified
without qualification, by an independent chartered accounting firm of national
standing or otherwise acceptable to Agent. Such Financial Statements shall be
accompanied by (i) a statement prepared in reasonable detail showing the
calculations used in determining compliance with each of the Financial
Covenants, (ii) the annual letters to such accountants in connection with
their audit examination detailing contingent liabilities and material
litigation matters, and (iii) the certification of the Chief Executive
Officer or Chief Financial Officer of the Corporation that all such Financial
Statements present fairly in accordance with GAAP the financial position,
results of operations and statements of cash flows of the Corporation and its
Subsidiaries on a consolidated and consolidating basis, as at the end of such
Fiscal Year and for the period then ended, and that there was no Default or
Event of Default in existence as of such time or, if a Default or Event of Default
has occurred and is continuing, describing the nature thereof and all efforts
undertaken to cure such Default or Event of Default.


 


(iv)                              Default Notices. To Agent and
Lenders, as soon as practicable, and in any event within five (5) Business
Days after an executive officer of a Credit Party has actual knowledge of the
existence of any Default, Event of Default or other event which has had a
Material Adverse Effect, telephonic or telecopied notice specifying the nature
of such Default or Event of Default or other event, including the


 


39

















 


anticipated
effect thereof, which notice, if given telephonically, shall be promptly
confirmed in writing on the next Business Day.


 


(v)                                 Securities Filings and Press
Releases. To Agent and Lenders, promptly upon their becoming
available, copies of: (i) all Financial Statements, reports, notices and
proxy statements made publicly available by any Credit Party to its security
holders; (ii) all regular and periodic reports and all prospectuses and
registration statements, if any, filed by any Credit Party with any securities
exchange or securities commission or any governmental or private regulatory
authority; and (iii) all press releases and other statements made
available by any Credit Party to the public concerning material changes or
developments in the business of any such Person.


 


(vi)                              Subordinated Debt and Equity
Notices. To Agent, as soon as practicable, copies of all material written
notices given or received by any Credit Party with respect to any Subordinated
Debt or Stock of such Person, and, within two (2) Business Days after any
Credit Party obtains knowledge of any matured or unmatured event of default
with respect to any Subordinated Debt, notice of such event of default.


 


(vii)                           Supplemental Schedules. To Agent,
supplemental disclosures, if any, required by Section 6.6.


 


(viii)                        Litigation. To Agent in
writing, promptly upon learning thereof, notice of any Litigation commenced or
threatened against any Credit Party that (i) seeks damages in excess of
$1,000,000, (ii) seeks injunctive relief, (iii) is asserted or
instituted against any Canadian Pension Plan or ERISA Plan, its fiduciaries or
its assets or against any Credit Party or ERISA Affiliate in connection with
any Canadian Pension Plan or ERISA Plan, (iv) alleges criminal misconduct
by any Credit Party, (v) alleges the violation of any law regarding, or
seeks remedies in connection with, any Environmental Liabilities; or (vi) involves
any product recall.


 


(ix)                                Insurance Notices. To Agent,
disclosure of losses or casualties required by Section 6.4.


 


(x)                                   Lease Default Notices. To Agent, (i) within
two (2) Business Days after receipt thereof, copies of any and all default
notices received under or with respect to any leased location or public
warehouse where Collateral is located, and (ii) such other notices or
documents as Agent may reasonably request.


 


(xi)                              Hedging
Agreements. To Agent within two (2) Business Days after
entering into such agreement or amendment, copies of all interest


 


40
















 


rate,
commodity or currency hedging agreements or amendments thereto.


 


(xii)                           Other Documents. To Agent and
Lenders, such other financial and other information respecting any Credit Party’s
business or financial condition as Agent or any Lender shall, from time to
time, reasonably request.


 


(b)                                 The Borrower hereby agrees
that from and after the Closing Date and until the Termination Date, it shall
deliver, or cause to be delivered, to the Agent, or to the Agent and Lenders,
as required, the following Collateral Reports (including Borrowing Base
Certificates in the form Exhibit 5.1(b)):


 


(i)                                   Borrower shall
deliver or cause to be delivered to the Agent within thirty (30) days after the
end of each Fiscal Month:


 


(A)                              the most recent Borrowing
Base, as determined in accordance with Section 5.1(c);


 


(B)                                a reconciliation of the
outstanding Loans as set forth in the monthly Loan Account statement provided
by Agent to Borrower’s general ledger, in each case accompanied by such
supporting detail and documentation as shall be requested by Agent in its
reasonable discretion;


 


(ii)                                Borrower, at
its own expense, shall deliver to Agent such appraisals of its assets as Agent
may request at any time after the occurrence and during the continuance of a
Default or an Event of Default, such appraisals to be conducted by an
appraiser, and to be in form and substance satisfactory to Agent, acting
reasonably; and


 


(iii)                             Such other
reports, statements and reconciliations with respect to the Borrowing Base or
Collateral or Obligations of any or all Credit Parties as Agent shall from time
to time request in its reasonable discretion.


 


(c)                                  The amount of
the Borrowing Base shall be determined, and if necessary, adjusted, by the
Agent:


 


(i)                                     on a monthly
basis, as it relates to:


 


(A)                              eligible
accounts receivable;


 


(B)                                eligible
Inventory;


 


(C)                                new Equipment
purchases (excluding eligible appraised Equipment; and


 


41

















 


(D)                               Equipment
sales; and


 


(ii)                                  on a quarterly
basis, as it relates to eligible appraised Equipment (on a physical basis for
no less than 12.5% of the Equipment, in terms of monetary value, and on a
desktop basis for the remainder of the Equipment); in furtherance of the
foregoing, the Borrower, at its own expense, agrees to provide such appraisals
within 30 days following the end of each such Fiscal Quarter, such appraisals
to be conducted by an appraiser, and to be in form and substance including the
schedule of Equipment to be appraised, satisfactory to Agent, acting reasonably,
and of that 12.5%, no less than 50% of the value is to be derived from assets
with a gross orderly liquidation value of less than $300,000.


 


5.2                               Communication with Accountants


 


Each
Credit Party authorizes Agent to communicate directly with its independent
chartered accountants, and authorizes and shall instruct those accountants and
advisors to disclose and make available to Agent any and all Financial
Statements and other supporting financial documents, schedules and information
relating to any Credit Party with respect to the business, results of
operations and financial condition of any Credit Party.


 


ARTICLE VI


AFFIRMATIVE COVENANTS


 


Each Credit Party agrees as
to all Consolidated Parties that from and after the date hereof and until the
Termination Date:


 


6.1                               Maintenance of Existence and Conduct of Business


 


Each
Consolidated Party shall: (a) do or cause to be done all things necessary
to preserve and keep in full force and effect its corporate existence and its
material rights and franchises; (b) continue to conduct its business
substantially as now conducted or as otherwise permitted hereunder; (c) at
all times maintain, preserve and protect all of its assets and properties used
or useful in the conduct of its business, and keep the same in good repair,
working order and condition in all material respects (taking into consideration
ordinary wear and tear) and from time to time make, or cause to be made, all
necessary or appropriate repairs, replacements and improvements thereto
consistent with industry practices; and (d) transact business only in such
corporate and trade names as are set forth in Disclosure Schedule 6.1.  The Borrower shall provide updates of
Disclosure Schedule 6.1 to the Agent promptly upon any permitted change, amendment,
dissolution or alteration to the corporate and trade names set out therein.


 


42

















 


6.2                               Payment of Charges


 


(a)                                  Subject to Section 6.2(b),
each Consolidated Party shall pay and discharge or cause to be paid and
discharged promptly all Charges payable by it before any thereof shall become
past due, including (i) Charges imposed upon it, its income and profits,
or any of its property (real, personal or mixed) and all Charges with respect
to employee source deduction obligations and employer obligations to its
employees, (ii) lawful claims for labour, materials, supplies and services
or otherwise, and (iii) all storage or rental charges payable to
warehousemen and bailees, in each case, before any thereof shall become past
due, except in the case of clauses (ii) and (iii) where the failure
to pay or discharge such Charges would not result in aggregate liabilities in
excess of $200,000.


 


(b)                                 Each Consolidated Party may
in good faith contest, by appropriate proceedings, the validity or amount of
any Charges, Taxes or claims described in Section 6.2(a); provided, that (i) adequate
reserves with respect to such contest are maintained on the books of such
Consolidated Party, in accordance with GAAP; (ii) no Lien shall arise or
be imposed to secure payment of such Charges (other than payments to
warehousemen and/or bailees) that is superior to any of the Liens securing
payment of the Obligations and such contest is maintained and prosecuted
continuously and with diligence and operates to suspend collection or
enforcement of such Charges, (iii) none of the Collateral becomes subject
to forfeiture or loss as a result of such contest, (iv) such Consolidated
Party shall promptly pay or discharge such contested Charges, Taxes or claims
and all additional charges, interest, penalties and expenses, if any, and shall
deliver to Agent evidence reasonably acceptable to Agent of such compliance,
payment or discharge, if such contest is terminated or discontinued adversely
to such Consolidated Party or the conditions set forth in this Section 6.2(b) are
no longer met; and (v) Agent has not advised Borrower in writing that
Agent reasonably believes that non-payment or non-discharge thereof could have
or result in a Material Adverse Effect.


 


6.3                               Books and Records


 


Each Consolidated Party shall keep adequate books and records with
respect to its business activities in which proper entries, reflecting all
financial transactions, are made in accordance with GAAP and on a basis
consistent with the Financial Statements attached as Disclosure Schedule
4.4(a)).


 


6.4                               Insurance; Damage to or Destruction of Collateral


 


(a)                                  The Consolidated Parties
shall, at their sole cost and expense, maintain policies of insurance in
accordance with the requirements described on Disclosure Schedule 6.4 or
otherwise in form and amounts and with insurers reasonably acceptable to Agent.
If any Consolidated Party at any time or times hereafter shall fail to obtain
or maintain any of the policies of insurance required above or to pay all
premiums


 


43

















 


relating
thereto, Agent may at any time or times thereafter obtain and maintain such
policies of insurance and pay such premiums and take any other action with
respect thereto that Agent deems advisable. 
Agent shall have no obligation to obtain insurance for any Consolidated
Party or pay any premiums therefor. By doing so, Agent shall not be deemed to
have waived any Default or Event of Default arising from any Consolidated Party’s
failure to maintain such insurance or pay any premiums therefor. All sums so
disbursed, including legal fees, court costs and other charges related thereto,
shall be payable on demand by Borrower to Agent and shall be additional
Obligations hereunder secured by the Collateral.


 


(b)                                 Agent reserves the right at
any time upon any change in any Consolidated Party’s risk profile (including
any change in the product mix maintained by any Consolidated Party or any laws
affecting the potential liability of such Consolidated Party) to require
additional forms and limits of insurance to, in Agent’s opinion, adequately
protect interest of Agent, on behalf of the Lenders, in all or any portion of
the Collateral and to ensure that each Consolidated Party is protected by
insurance in amounts and with coverage customary for its industry. If
reasonably requested by Agent, each Consolidated Party shall deliver to Agent
on an annual basis a report of a reputable insurance broker reasonably
satisfactory to Agent, with respect to its insurance policies. Such broker
shall advise the Agent promptly in writing of any default in the payment of any
premiums or any other act or omission, on the part of any Person, which might
invalidate or render unenforceable, in whole or in part, any insurance provided
by the Consolidated Parties hereunder.


 


(c)                                  Provided any Default or
Event of Default has occurred and is continuing, each Credit Party irrevocably
makes, constitutes and appoints Agent (and all officers, employees or agents
designated by Agent) as each Credit Party’s true and lawful agent and attorney
in fact for the purpose of making, settling and adjusting claims under such “All
Risk” policies of insurance, endorsing the name of such Credit Party on any
cheque or other item of payment for the proceeds of such “All Risk” policies of
insurance and for making all determinations and decisions with respect to such “All
Risk” policies of insurance. Agent shall have no duty to exercise any rights or
powers granted to it pursuant to the foregoing power-of-attorney.


 


(d)


 


(i)                                     The affected Credit Party
shall promptly notify Agent of any loss, damage, or destruction to the
Collateral in the amount of $1,000,000 or more, whether or not covered by
insurance. Upon receipt of any such insurance proceeds, the Borrower shall make
an Asset Sale Offer in accordance with Section 1.5(c)(iii), provided that
if no Default or Event of Default has occurred and is continuing, such Credit
Party will replace, restore, repair or rebuild within 180 days of such
casualty;


 


44

















 


(ii)                                all insurance
proceeds that are to be made available to replace, repair, restore or rebuild
the Collateral shall be applied by Agent to reduce the outstanding principal
balance of the Revolving Loan (which application shall not result in a
permanent reduction of the Revolving Loan Commitment) and upon such
application, Agent shall establish a Reserve against the Borrowing Base in an
amount equal to the amount of such proceeds so applied; and


 


(iii)                             Thereafter,
such funds shall be made available to such Credit Party to provide funds to
replace, repair, restore or rebuild the Collateral as follows: (i) Borrower
shall request a Revolving Credit Advance be made to such Credit Party in the
amount requested to be released; (ii) so long as the conditions set forth
in Section 2.2 have been met, the Lenders shall make such Revolving Credit
Advance; and (iii) in the case of insurance proceeds applied against the
Revolving Loan, the Reserve established with respect to such insurance proceeds
shall be reduced by the amount of such Revolving Credit Advance. To the extent
not used to replace, repair, restore or rebuild the Collateral, such insurance
proceeds shall be applied in accordance with Section 1.5(c).


 


(e)                                  Notwithstanding the
foregoing, the existing Inland Marine Insurance deductible exceeds $25,000 and
has a $1,000,000 aggregate policy limit per year which is a breach of the
covenant in Section 6.4(a) and Disclosure Schedule 6.4(a) and
consequently would be an Event of Default under Section 10.1(b) (the “Insurance Deductible Default”). Until April 30,
2009, the Insurance Deductible Default is waived, after which date the Inland
Marine Insurance deductible shall not exceed $25,000, provided that until such
date the annual insurance premium shall be reduced by a minimum of $800,000.


 


6.5                               Compliance with Laws


 


(a)                                  General. Each
Consolidated Party shall comply with all federal, provincial, local and foreign
laws and regulations applicable to it, including ERISA and those relating to
employment and labour matters (except to the extent that the failure to comply
with ERISA and those laws and regulations relating to employment and labour
matters, individually or in the aggregate, could not reasonable be expected to
have a Material Adverse Effect), and Environmental Laws and Environmental
Permits.


 


(b)                                 Canadian Pension Plans and
Benefit Plans


 


(i)                                   For each
existing, or hereafter adopted, Canadian Pension Plan and Canadian Benefit
Plan, each Consolidated Party shall in a timely fashion comply with and perform
in all material respects all of its obligations under and in respect of such
Canadian Pension Plan or


 


45

















 


Canadian
Benefit Plan, including under any funding agreements and all applicable laws
(including any fiduciary, funding, investment and administration obligations).


 


(ii)                                All employer or
employee payments, contributions or premiums required to be remitted, paid to
or in respect of each Canadian Pension Plan or Canadian Benefit Plan shall be
paid or remitted by each Consolidated Party in a timely fashion in accordance
with the terms thereof, any funding agreements and all applicable laws.


 


(iii)                             Borrower shall
deliver to Agent (i) if requested by Agent, copies of each annual and
other return, report or valuation with respect to each Canadian Pension Plan as
filed with any applicable Governmental Authority; (ii) promptly after
receipt thereof, a copy of any direction, order, notice, ruling or opinion that
any Consolidated Party may receive from any applicable Governmental Authority
with respect to any Canadian Pension Plan; and (iii) notification within
30 days of any increases having a cost to one or more of the Consolidated
Parties in excess of $100,000 per annum in the aggregate, in the benefits of
any existing Canadian Pension Plan or Canadian Benefit Plan, or the
establishment of any new Canadian Pension Plan or Canadian Benefit Plan, or the
commencement of contributions to any such plan to which any Consolidated Party
was not previously contributing.


 


6.6                               Supplemental Disclosure


 


From time to time as may be reasonably requested by Agent (which
request will not be made more frequently than once each year absent the
occurrence and continuance of an Event of Default) or at Credit Parties’
election, the Credit Parties shall supplement each Disclosure Schedule hereto,
or any representation herein or in any other Loan Document, with respect to any
matter hereafter arising that, if existing or occurring at the date of this
Agreement, would have been required to be set forth or described in such
Disclosure Schedule or as an exception to such representation or that is
necessary to correct any information in such Disclosure Schedule or
representation which has been rendered inaccurate thereby (and, in the case of
any supplements to any Disclosure Schedule, such Disclosure Schedule shall be
appropriately marked to show the changes made therein); provided that (a) no
such supplement to any such Disclosure Schedule or representation shall amend,
supplement or otherwise modify any Disclosure Schedule or representation, or be
or be deemed a waiver of any Default or Event of Default resulting from the
matters disclosed therein, except as consented to by Agent and Requisite
Lenders in writing, and (b) no supplement shall be required or permitted
as to representations and warranties that relate solely to the Closing Date.


 


46

















 


6.7                               Intellectual Property


 


Each Consolidated Party will conduct its business and affairs without
infringement of or interference with any Intellectual Property of any other
Person in any material respect and shall comply in all material respects with
the terms of its Licenses.


 


6.8                               Environmental Matters


 


(a)                                  Environmental Certificates. The Borrower
will provide an Environmental Certificate (in the form attached in Exhibit 6.8(a))
to the Agent with sufficient copies for each of the Lenders at the same time as
the delivery of the annual financial statements referred to in Section 6.3.


 


(b)                                 Additional Environmental
Information. The Borrower will upon the request of the Agent
make available for discussion with the Agent or its nominee at all reasonable
times the individuals who were involved in the preparation of any Environmental
Certificate.


 


(c)                                  Environmental Audit. The Borrower
will, and will cause the other Consolidated Parties to, at the request of Agent
and no more than once per year, conduct environmental audits of the business of
each Consolidated Party by an independent consultant selected by the Agent. The
reasonable costs of each such audit will be for the account of the Borrower;
provided that the Borrower shall not be required to account for the costs of
more than a single audit during any 12 month period. Should the result of such
audit indicate that:


 


(i)                                   a Consolidated
Party is in breach, or with the passage of time will be in breach, of any
Environmental Law which could result in aggregate liabilities in excess of
$100,000; or


 


(ii)                                the business of
each Consolidated Party has not been conducted and operated in accordance with
all Environmental Laws or that a Consolidated Party should have knowledge of
any fact, circumstance or condition in respect of the Assessed Equipment or its
maintenance or operation that is likely to result in any Environmental
Liabilities or investigation, claim, order, suit, action or proceedings
regarding the breach of any Environmental Laws or the provisions of any
Environmental Permits, which could result in aggregate liabilities in excess of
$100,000,


 


and without in any way prejudicing or suspending any of the rights and
remedies of the Agent and the Lenders under the Loan Documents, the Borrower
will forthwith commence and diligently proceed to rectify or cause to be
rectified such breach, potential breach, fact, circumstance or condition, as
the case may be, and will keep the Lenders fully advised of the actions it
intends to take and has taken to rectify such breach or potential breach and
the progress it is making in


 


47

















 


rectifying
same.  The Agent will be permitted to
retain, for the account of the Borrower (to the extent such account is
reasonable), the services of a consultant to monitor the applicable
Consolidated Party’s compliance with this Section 6.8(c).


 


(d)                                 Notice of Environmental
Damage. The Borrower will, forthwith upon acquiring knowledge thereof, notify
the Agent of the discovery of any breach, potential breach, fact, circumstance
or condition that is likely to result in any Environmental Liabilities or
investigation, claim, order, suit, action or proceedings regarding the breach
of any Environmental Laws or the provisions of any Environmental Permits
including, without limitation, any knowledge or discovery of any Releases of a
Hazardous Material from or upon the land or property owned (either individually
or jointly), operated or controlled by any Consolidated Party, which could
result in aggregate liabilities in excess of $100,000.


 


6.9                               Landlords’ Agreements, Mortgagee Agreements, Bailee Letters and Real
Estate Purchases


 


Each Credit Party shall use commercially reasonable efforts (such
efforts not to include payment of any fees or deposits) to obtain a landlord’s
agreement, mortgagee agreement or bailee letter, as applicable, from the lessor
of each leased property, mortgagee of owned property or bailee with respect to
the warehouse, processor or converter facility or other location that is a New
Key Location where Collateral is stored or located, which agreement or letter
shall contain a waiver or subordination of all Liens or claims that the
landlord, mortgagee or bailee may assert against the Collateral at that New Key
Location, and shall otherwise be reasonably satisfactory in form and substance
to Agent. Each Credit Party shall timely and fully pay and perform its
obligations under all leases and other agreements with respect to each leased
location or public warehouse where any Collateral is or may be located.


 


6.10                        Further Assurances


 


Each Credit Party agrees that it shall, and shall cause each other
Consolidated Party to, at such Credit Party’s expense and upon the reasonable
request of Agent, duly execute and deliver, or cause to be duly executed and
delivered, to Agent such further instruments and do and cause to be done such
further acts as may be necessary or proper in the reasonable opinion of Agent
to carry out more effectively the provisions and purposes of this Agreement and
each Loan Document.


 


ARTICLE VII


NEGATIVE COVENANTS


 


Each Credit Party agrees as
to all Consolidated Parties that from and after the date hereof until the
Termination Date:


 


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7.1                               Amalgamations, Mergers, Subsidiaries, Etc.


 


(a)                                  Except as otherwise provided
in Section 7.2 or in this Section 7.1 below, no Consolidated Party
shall directly or indirectly, by operation of law or otherwise, (a) form
or acquire any Subsidiary, or (b) amalgamate or merge with, consolidate
with, acquire all or substantially all of the assets or Stock of, or otherwise
combine with or acquire, any Person. Notwithstanding the foregoing, any
Consolidated Party may enter into a Permitted Acquisition to acquire all or
substantially all of the assets or Stock of any Person (the “Target”) subject to the satisfaction of
each of the following conditions:


 


(i)                                     such Permitted
Acquisition shall only involve assets located in Canada and the U.S. and
comprise a business, or those assets of a business, of the type engaged in by
Credit Parties (on a consolidated basis) as of the Closing Date, and which
business would not subject either Lender to regulatory or third party approvals
in connection with the exercise of its rights and remedies under this Agreement
or any other Loan Documents other than approvals applicable to the exercise of
such rights and remedies with respect to such Consolidated Party prior to such
Permitted Acquisition;


 


(ii)                                such Permitted
Acquisition shall be consensual and shall have been approved by the Target’s
board of directors;


 


(iii)                             no additional
Indebtedness, Guaranteed Indebtedness, contingent obligations or other
liabilities shall be incurred, assumed or otherwise be reflected on a
consolidated balance sheet of such Consolidated Party and Target after giving
effect to such Permitted Acquisition, except (A) the Loans made hereunder
and (B) ordinary course trade payables, accrued expenses and unsecured
Indebtedness of the Target to the extent no Default or Event of Default has
occurred and is continuing or would result after giving effect to such
Permitted Acquisition;


 


(iv)                              the sum of all amounts
payable in connection with all Permitted Acquisitions (including all
transaction costs and all Indebtedness, liabilities and contingent obligations
incurred or assumed in connection therewith or otherwise reflected on a
consolidated balance sheet of such Consolidated Party and Target) shall not
exceed $40,000,000 during any Fiscal Year and the portion thereof allocable to
goodwill and intangible assets for all such Permitted Acquisitions during any
Fiscal Year shall not exceed $28,000,000;


 


(v)                                 the Target shall not have
incurred an operating loss for the trailing twelve-month period preceding the
date of the Permitted Acquisition, as determined based upon the Target’s
financial statements for its


 


49

















 


most
recently completed fiscal year and its most recent interim financial period
completed within sixty (60) days prior to the date of consummation of such
Permitted Acquisition;


 


(vi)                              any debt
associated with Liens on the business and assets acquired in such Permitted
Acquisition shall be paid out on the closing of such Permitted Acquisition and,
within 30 days following the closing of such Permitted Acquisition, the
discharge of the registrations of such Liens shall have occurred;


 


(vii)                         within 30 days
following the closing of any Permitted Acquisition involving the acquisition of
assets only, Agent will be granted a first priority perfected Lien (subject to
Permitted Encumbrances) in all such assets acquired pursuant thereto of the
Target, and such Credit Parties and the Target shall have executed such
documents and taken such actions as may be required by Agent in connection
therewith;


 


(viii)                      within 180 days
following the closing of any Permitted Acquisition involving the acquisition of
Stock, or the next Notification Date, whichever is earlier, Agent will be
granted a first priority perfected Lien (subject to Permitted Encumbrances) in
all such Stock and assets acquired pursuant thereto of the Target, and such
Consolidated Parties and the Target shall have executed such documents and
taken such actions as may be required by Agent in connection therewith;


 


(ix)                                on or prior to
the closing date of any Permitted Acquisition equal to or in excess of
$10,000,000, the Corporation shall have delivered to Agent, in form and
substance reasonably satisfactory to Agent:


 


(A)                              a pro-forma consolidated balance sheet, income statement and
cash flow statement of the Corporation and its Subsidiaries (the “Acquisition Pro Forma”), based on recent
financial statements, which shall be complete and shall fairly present in all
material respects the assets, liabilities, financial condition and results of
operations of the Corporation and its Subsidiaries in accordance with GAAP
consistently applied, but taking into account such Permitted Acquisition and
the funding of all Loans in connection therewith, and such Acquisition Pro
Forma shall reflect that on a pro-forma basis
(after giving effect to such Permitted Acquisition and all Loans funded in
connection therewith as if made on the first day of such period) and the
Acquisition Projections (as herein defined) shall reflect that no Event of
Default has occurred and is continuing or would result after giving effect to
such Permitted Acquisition and the Corporation and its Subsidiaries would have
been in compliance with the Financial Covenants set forth in Article VIII
for the period reflected in the Compliance Certificate


 


50
















 


most
recently delivered to Agent pursuant to 5.1(a) prior to the consummation
of such Permitted Acquisition (after giving effect to such Permitted
Acquisition and all Loans funded in connection therewith as if made on the
first day of such period);


 


(B)                                updated versions of the most
recently delivered Projections covering the one (1) year period commencing
on the date of such Permitted Acquisition and otherwise prepared in accordance
with the Projections (the “Acquisition
Projections”) and based upon historical financial data of a recent
date reasonably satisfactory to Agent, taking into account such Permitted
Acquisition; and


 


(C)                                a certificate of the Chief
Financial Officer of the Corporation to the effect that: (w) the
Corporation and such Consolidated Party will be Solvent upon the consummation
of the Permitted Acquisition; (x) the Acquisition Pro Forma fairly
presents the financial condition of Corporation (on a consolidated basis) as of
the date thereof after giving effect to the Permitted Acquisition; (y) the
Acquisition Projections are reasonable estimates of the future financial
performance of the Corporation (on a consolidated basis) subsequent to the date
thereof based upon the historical performance of the Corporation and the Target
and show that the Corporation shall continue to be in compliance with the
Financial Covenants set forth in Article VIII for the 3-year period
thereafter; and (z) such Consolidated Party has completed their due
diligence investigation with respect to the Target and such Permitted
Acquisition, which investigation was conducted in a manner similar to that
which would have been conducted by a prudent purchaser of a comparable business
and the results of which investigation were delivered to Agent and Lenders;


 


(x)                                   in connection with a
Permitted Acquisition equal to or in excess of $10,000,000, on or prior to the
date of such Permitted Acquisition, Agent shall have received, in form and
substance reasonably satisfactory to Agent, copies of the acquisition agreement
and related agreements and instruments, and all opinions, certificates, lien
search results and other documents reasonably requested by Agent, including
those specified in the last sentence of Section 6.9;


 


(xi)                              such Permitted
Acquisition shall have been the subject of a Phase I Environmental Site
Assessment and, if necessary, a Phase II Environmental Site Assessment, by an
independent consultant selected by Agent, and the Consolidated Party shall have
caused the performance of an internal environmental, health and safety audit of
the business of the Consolidated Party, and the results of any such assessment
and audit shall have been provided to Agent; and


 


51

















 


(xii)                           at the time of
such Permitted Acquisition and after giving effect thereto, no Default or Event
of Default has occurred and is continuing.


 


7.2                               Reorganization. Any Credit Party that has provided Collateral
Documents accepted by the Agent may, from time to time, amalgamate, merge or
consolidate with another Credit Party, or transfer the stock or assets of any
Target to another Credit Party or Subsidiary of a Credit Party, provided that
in the case of any such amalgamation, merger, consolidation or transfer:


 


(a)                                  no Default or
Event of Default shall have occurred and be continuing at the time of such
amalgamation, merger, consolidation or transfer, and no Default or Event of
Default will result from such amalgamation, merger, consolidation or transfer;


 


(b)                                 contemporaneously
with or not less than three (3) Business Days following the consummation
of such amalgamation, merger, consolidation or transfer, as the case may be,
the resulting Person by way of such amalgamation, merger, consolidation or
transfer, will have executed and/or delivered to the Agent such instruments and
done such things as in the reasonable opinion of the Agent are necessary or
advisable to establish that such Person will be a Credit Party, including:


 


(i)                                   the successor
entity is a Person formed under the laws of Canada or one of its provinces
which will have assumed, whether by operation of law or by an acknowledgement
or other writing in pursuance hereof, all the covenants and obligations of such
Person’s predecessor Credit Parties under the Loan Documents;


 


(ii)                                the Loan
Documents of such successor Person, including to the extent required, any
Collateral Documents or other Loan Documents (in substitution for such
corresponding Collateral Documents and other Loan Documents to which such
Persons’ respective predecessors were parties), all of which shall be valid and
binding obligations of the successor entity entitling the Lenders and the
Agent, as against the successor entity, to exercise all their rights and
benefits thereunder;


 


(iii)                             the Lien
created by the Collateral Documents will continue to be a Lien against the
property of the successor entity in substantially the same manner and to the
same extent and priority as existed immediately prior to such Person’s
amalgamation, merger, consolidation or transfer, as the case may be;


 


(iv)                              the rights and
benefits afforded or intended to be afforded the Lenders and the Agent under
the Loan Documents are not materially prejudiced; and


 


52

















 


(v)                                 legal opinions of counsel to
such Person (as successor Credit Party) in form satisfactory to the Agent; and


 


(c)                                  no Material Adverse Effect
could reasonably be expected to occur as a result of such amalgamation, merger,
consolidation or transfer.


 


7.3                               Investments; Loans and Advances


 


Except as otherwise expressly permitted by this Article VII, no
Consolidated Party shall make or permit to exist any investment in, or make,
accrue or permit to exist loans or advances of money to, any Person, through
the direct or indirect lending of money, holding of securities or otherwise,
except that: (a) the Credit Parties may hold investments comprised of
notes payable, or stock or other securities issued by Account Debtors to
Borrower pursuant to negotiated agreements with respect to settlement of such
Account Debtor’s Accounts in the ordinary course of business, consistent with
past practices; (b) each Consolidated Party may make new investments,
loans and advances to other Credit Parties; and (c) each Credit Party may
maintain its existing investments as of the Closing Date and make new
investments, loans and advances not otherwise permitted hereunder, provided
that such new investments, loans and advances by a Credit Party do not exceed
$2,000,000 in the aggregate.


 


7.4                               Indebtedness


 


(a)                                  No Consolidated Party shall
create, incur, assume or permit to exist any Indebtedness, except (without
duplication) (i) Indebtedness secured by purchase money security interests
and Capital Leases permitted in Section 7.8, (ii) the Loans and the
other Obligations, (iii) Indebtedness permitted in Sections 7.3(b) and
7.3(c), (iv) existing Indebtedness described in Disclosure Schedule 7.4
and refinancings thereof or amendments or modifications thereof that do not
have the effect of increasing the principal amount thereof or changing the
amortization thereof (other than to extend the same) and that are otherwise on
terms and conditions no less favourable to any Consolidated Party, Agent or any
Lender, as determined by Agent, than the terms of the Indebtedness being
refinanced, amended or modified, (v) Indebtedness to any Credit Parties, (vi) Indebtedness
specifically permitted under Section 7.1 and (vii) obligations of any
Credit Party under any Secured Rate Contracts or Secured Rate Contract Support
Documents entered into for the sole purpose of hedging in the normal course of
business and consistent with industry practices.


 


(b)                                 No Consolidated Party shall,
directly or indirectly, voluntarily purchase, redeem, defease or prepay any
principal of, premium, if any, interest or other amount payable in respect of
any Indebtedness, other than (i) the Obligations; (ii) Indebtedness
secured by a Permitted Encumbrance if the asset securing such Indebtedness has
been sold or otherwise disposed of in accordance with Section 7.9 (b) or
(c); (iii) Indebtedness permitted by Section 7.4(a)(ii); (iv) Indebtedness


 


53

















 


permitted by Section 7.4(a)(iii) upon any refinancing thereof
in accordance with Section 7.4(a)(iii) .


 


7.5                               Employee Loans and Affiliate Transactions


 


(a)                                  No Consolidated Party shall
enter into or be a party to any transaction with any other Credit Party or any
Affiliate thereof except in the ordinary course of and pursuant to the
reasonable requirements of such Consolidated Party’s business and upon fair and
reasonable terms that are no less favourable to such Consolidated Party than
would be obtained in a comparable arm’s length transaction with a Person not an
Affiliate of such Consolidated Party. In the aggregate, the terms of these
transactions must be disclosed in advance to Agent and Lenders. All such
transactions existing as of the date hereof are described in Disclosure
Schedule 7.5(a).


 


(b)                                 No Consolidated Party shall
enter into any lending or borrowing transaction with any employees of any
Consolidated Party, except loans to its respective employees on an arm’s length
basis in the ordinary course of business consistent with past practices for
travel and entertainment expenses, relocation costs and similar purposes up to
a maximum of $300,000 to any employee and up to a maximum of $1,000,000 in the
aggregate at any one time outstanding. All such transactions existing as of the
date hereof are described in Disclosure Schedule 7.5(b).


 


7.6                               Capital Structure and Business


 


If all or part of a Consolidated Party’s Stock is pledged to Agent,
that Consolidated Party shall not issue additional Stock. No Consolidated Party
shall amend its constating documents, by-laws, partnership agreement or
operating agreement, as applicable, in a manner that would adversely affect
Agent or Lenders or such Consolidated Party’s duty or ability to repay the
Obligations. No Consolidated Party shall engage in any business other than the
businesses currently engaged in by it or businesses reasonably related thereto.
No Consolidated Party shall amend its constating documents to add provisions
which require director consent only to the transfer of such Consolidated Party’s
shares or other equity securities.


 


7.7                               Guaranteed Indebtedness


 


No Consolidated Party shall create, incur, assume or permit to exist
any Guaranteed Indebtedness except (a) by endorsement of instruments or
items of payment for deposit to the general account of any Credit Party, (b) for
Guaranteed Indebtedness incurred for the benefit of any other Credit Party if
the primary obligation is expressly permitted by this Agreement, (c) Employee
Unit Plan Guarantees and (d) existing Guaranteed Indebtedness described in
Disclosure Schedule 7.7.


 


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7.8                               Liens


 


No Consolidated Party shall create, incur, assume or permit to exist
any Lien on or with respect to its Accounts or any of its other properties or
assets (whether now owned or hereafter acquired) except for (a) Permitted
Encumbrances; (b) Liens in existence on the date hereof and summarized on
Disclosure Schedule 7.8 securing Indebtedness described on Disclosure Schedule
7.4 and permitted refinancings, extensions and renewals thereof, including
extensions or renewals of any such Liens; (c) Liens in respect of existing
and future operating leases of personal property so long as (i) annual
payments and other obligations under such existing and future operating leases
of personal property are equal to or less than $15,000,000 in the aggregate,
and (ii) such Liens attach only to the assets that are subject thereto; (d) Liens
in respect of existing and future operating leases of real property; and (e) the
Credit Parties’ Capital Leases equal to or less than $45,000,000. In addition,
no Consolidated Party shall become a party to any agreement, note, indenture or
instrument, or take any other action, that would prohibit the creation of a
Lien on any of its properties or other assets in favour of Agent, on behalf of
the Lenders of, as additional collateral for the Obligations, except operating
leases, Capital Leases or Licenses which prohibit Liens upon the assets that
are subject thereto.


 


7.9                               Sale of Stock and Assets


 


No Consolidated Party shall sell, transfer, convey, assign or otherwise
dispose of any of its properties or other assets, including the Stock of any of
its Subsidiaries (whether in a public or a private offering or otherwise) or
any of its Accounts, other than (a) the sale of Inventory in the ordinary
course of business, and (b) the sale or other disposition by a Consolidated
Party of Equipment, Fixtures or Real Estate that are obsolete or no longer used
or useful in such Consolidated Party’s business and having a Book Value, not
exceeding $5,000,000 in the aggregate in any Fiscal Year and (c) the sale
or other disposition of other Equipment and Fixtures having a Book Value not
exceeding $2,500,000 in the aggregate in any Fiscal Year, without the prior
written consent of the Lenders.


 


7.10                        Pensions and Benefit Plans


 


(a)                                  No Consolidated Party shall
permit its unfunded pension fund and other employee benefit plan obligations
and liabilities to remain unfunded other than in accordance with applicable
law.


 


(b)                                 No Consolidated Party shall,
or shall cause or permit any ERISA Affiliate to, cause or permit to occur (i) an
event that could result in the imposition of a Lien under Section 412 of
the IRC or Section 302 or 4068 of ERISA or (ii) an ERISA Event to the
extent such ERISA Event would reasonably be expected to result in taxes,
penalties and other liability in excess of $250,000 in the aggregate.


 


55

















 


7.11                        Hazardous Materials


 


No Consolidated Party shall cause or permit a Release of any Hazardous
Material on, at, in, under, above, to, from or about any of the Real Estate or
maintain or operate the Assessed Equipment in contravention with Environmental
Laws or in such a way that is likely to result in any Environmental Liabilities
or investigation, claim, order, suit, action or proceedings regarding the
breach of any Environmental Laws or the provisions of any Environmental Permits
in excess of $100,000 in the aggregate.


 


7.12                        Sale Leasebacks


 


Except to the extent permitted within the limits set out in Section 7.8,
no Consolidated Party may engage in any sale leaseback, synthetic lease or
similar transaction involving any of its assets and in no circumstances will a
Consolidated Party engage in any sale leasebacks, synthetic leases or similar
transactions involving assets that form any part of the Borrowing Base except
to the extent of any such assets acquired in the 120 days prior to such
transaction and provided the Borrowing Base will remain in excess of the
aggregate Loans.


 


7.13                        Restricted Payments


 


No Consolidated Party shall make any Restricted Payment, except (a) intercompany
loans and advances between the Credit Parties to the extent permitted by Section 7.4,
(b) dividends and distributions by Subsidiaries of a Credit Party paid to
a Credit Party, (c) employee loans permitted under Section 7.5(b), (d) scheduled
payments of principal and interest on Subordinated Debt and (e) other
Permitted Distributions provided, that (i) no Default or Event of Default
has occurred and is continuing or would result after giving effect to any
Restricted Payment otherwise permitted pursuant to the foregoing; (ii) such
Permitted Distribution is within the limits under Section 8.6, and for
purposes of any Permitted Distribution set out in (d) of the definition
thereof, (iii) at the end of the preceding month, Funded Debt minus
Subordinated Debt, both measured as of the last day of such preceding month, to
EBITDA for the twelve months then ended is equal to or less than 2.50:1, and (iv) at
the end of the preceding month, Funded Debt measured as of the last day of such
preceding month, to EBITDA for the twelve months then ended is equal to or less
than 3.00:1.


 


For purposes of the tests set out in Section 7.13(iii) and
7.13(iv) above, the tests need only be demonstrated monthly until
quarterly financials and a Compliance Certificate are delivered in accordance
with Section 5.1(a)(i) and these demonstrate compliance with such
tests, following which such test need only be demonstrated quarterly. In order
to evidence compliance with such tests set out in this Section 7.13, the
Borrower must provide a monthly or quarterly (as applicable) Compliance
Certificate and financials to evidence such compliance in each case in the form
set out in Section 5.1(a)(i).


 


56

















 


7.14                        Change of Corporate Name or Location; Change of Fiscal Year


 


Subject to Section 7.2, no Credit Party shall (a) change its
incorporated name, or if not a corporation, its name as it appears in official
filings in the jurisdiction of its organization, (b) change its chief
executive office, principal place of business, corporate offices or warehouses
or locations at which Collateral is held or stored, or the location of its
records concerning the Collateral, (c) change the type of entity that it
is, (d) change its jurisdiction of incorporation or organization, in each
case without at least thirty (30) days prior written notice to Agent and after
Agent’s written acknowledgment that any reasonable action requested by Agent in
connection therewith, including to continue the perfection of any Liens in
favour of Agent, on behalf of the Lenders, in any Collateral, has been
completed or taken, and provided, that with respect to paragraphs (b) and
(d), any such new location shall be in Canada or the United States of America.
Subject to Section 7.2, without limiting the foregoing, no Credit Party
shall change its name, identity or corporate or organizational structure in any
manner that might make any financing statement filed in connection herewith or
any other Loan Document materially misleading within the meaning of the PPSA
(or any comparable provision then in effect) except upon prior written notice
to Agent and after Agent’s written acknowledgement that any reasonable action
requested by Agent in connection therewith, including to continue the
perfection of any Liens in favour of Agent, on behalf of the Lenders, in any
Collateral, has been completed or taken. No Credit Party shall change its
Fiscal Year.


 


7.15                        No Impairment of Intercompany Transfers


 


No Consolidated Party shall directly or indirectly enter into or become
bound by any agreement, instrument, indenture or other obligation (other than
this Agreement and the other Loan Documents) that could directly or indirectly
restrict, prohibit or require the consent of any Person with respect to the
payment of dividends or distributions or the making or repayment of
intercompany loans by a Subsidiary of Borrower to Borrower.


 


ARTICLE VIII


FINANCIAL COVENANTS


 


The Corporation shall not
breach or fail to comply with any of the following financial covenants (the “Financial Covenants”), each of which shall
be calculated in accordance with GAAP consistently applied:


 


8.1                               Maximum Capital Expenditures


 


The
total of all Unfinanced Capital Expenditures of the Corporation and its
Subsidiaries on a consolidated basis during any Fiscal Year shall not exceed
$20,000,000 per such year.


 


57

















 


8.2                               Working Capital Ratio


 


The Corporation and its Subsidiaries, on a consolidated basis, shall
have at the end of each Fiscal Quarter a Working Capital Ratio of not less than
1.25:1.


 


8.3                               Fixed Charge Coverage Ratio


 


(a)                                  The Corporation and its
Subsidiaries, on a consolidated basis, shall have at the end of each Fiscal
Quarter, a Fixed Charge Coverage Ratio of equal to or greater than 1.5:1.


 


(b)                                 upon any proposed
acquisition exceeding the Permitted Acquisition threshold and requiring Lender
approval, the ratio referenced in (a) shall be adjusted on a proforma
basis acceptable to the Requisite Lenders, acting reasonably.


 


8.4                               Maximum Funded Senior Debt to EBITDA


 


(a)                                  The Corporation and its
Subsidiaries, on a consolidated basis, shall maintain a ratio of, at the end of
each Fiscal Quarter, Funded Debt minus Subordinated Debt, both measured as of
the last day of each Fiscal Quarter, to EBITDA for the four Fiscal Quarters
then ended equal to or less than 2.50:1.


 


(b)                                 upon any proposed
acquisition exceeding the Permitted Acquisition threshold and requiring Lender
approval, the ratio referenced in (a) shall be adjusted on a proforma
basis acceptable to the Requisite Lenders, acting reasonably.


 


8.5                               Funded Debt to EBITDA


 


(a)                                  The Corporation and its
Subsidiaries, on a consolidated basis, shall maintain a ratio of, at the end of
each Fiscal Quarter, Funded Debt measured as of the last day of each Fiscal
Quarter, to EBITDA for the four Fiscal Quarters then ended equal to or less
than 3.00:1.


 


(b)                                 upon any proposed
acquisition exceeding the Permitted Acquisition threshold and requiring Lender
approval, the ratio referenced in (a) shall be adjusted on a proforma basis
acceptable to the Requisite Lenders, acting reasonably.


 


8.6                               Maximum Distribution Payout


 


Except from one Credit Party to another, the Credit Parties, in the
aggregate, shall not make Restricted Payments (excluding the aggregate of all
payments and/or distributions made by the Credit Parties which are subsequently
reinvested by the Credit Parties pursuant to the DRIP) during any rolling 12
month period in excess of 80% of Excess Cash Flow of the Corporation and its
Subsidiaries on a consolidated basis.


 


58

















 


8.7                               Minimum Net Worth


 


The Corporation and its Subsidiaries on a consolidated basis shall at
all times (tested at the end of each Fiscal Quarter) maintain a Net Worth of
not less than the sum of (i) $167,000,000 plus (ii) 20% of Excess
Cash Flow measured on a cumulative basis beginning September 30, 2008
(without deduction for losses) and ending on the last day of such Fiscal
Quarter.


 


8.8                               Additional Information


 


Unless otherwise specifically provided herein, any accounting term used
in the Agreement shall have the meaning customarily given such term in
accordance with GAAP, and all financial computations hereunder shall be
computed in accordance with GAAP consistently applied. That certain items or computations
are explicitly modified by the phrase “in accordance with GAAP” shall in no way
be construed to limit the foregoing. If any “Accounting
Changes” (as defined below) occur and such changes result in a
change in the calculation of the Financial Covenants, standards or terms used
in the Agreement or any other Loan Document, then Borrower, Agent and Lenders
agree to enter into negotiations in order to amend such provisions of the
Agreement so as to equitably reflect such Accounting Changes with the desired
result that the criteria for evaluating the Corporation’s and its Subsidiaries’
financial condition shall be the same after such Accounting Changes as if such
Accounting Changes had not been made; provided, however, that the agreement of
Requisite Lenders to any required amendments of such provisions shall be
sufficient to bind all Lenders. “Accounting
Changes” means (i) changes in accounting principles required by
the promulgation of any rule, regulation, pronouncement or opinion by the
Canadian Institute of Chartered Accountants (or successor thereto or any agency
with similar functions), (ii) changes in accounting principles concurred
in by the Corporation’s independent chartered accountants; and (iii) the
reversal of any reserves established as a result of purchase accounting
adjustments. All such adjustments resulting from expenditures made subsequent
to the Closing Date (including capitalization of costs and expenses or payment
of pre-Closing Date liabilities) shall be treated as expenses in the period the
expenditures are made and deducted as part of the calculation of EBITDA in such
period. If Agent, Borrower and Requisite Lenders agree upon the required
amendments (and all other Credit Parties shall be deemed to agree to such
amendments so agreed to by Borrower), then after appropriate amendments have
been executed and the underlying Accounting Change with respect thereto has
been implemented, any reference to GAAP contained in the Agreement or in any
other Loan Document shall, only to the extent of such Accounting Change, refer
to GAAP, consistently applied after giving effect to the implementation of such
Accounting Change. If Agent, Borrower and Requisite Lenders cannot agree upon
the required amendments within thirty (30) days following the date of
implementation of any Accounting Change, then all Financial Statements
delivered and all calculations of Financial Covenants and other standards and
terms in accordance with the Agreement and the other Loan Documents shall be
prepared, delivered and made without regard to the underlying Accounting
Change. For purposes of this Article VIII, a breach of a


 


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Financial
Covenant contained in this Article VIII shall be deemed to have occurred
as of any date of determination by Agent or as of the last day of any specified
measurement period, regardless of when the Financial Statements reflecting such
breach are delivered to Agent.


 


ARTICLE IX


TERM


 


9.1                               Termination


 


The financing arrangements contemplated hereby shall be in effect until
the final Maturity Date of a Term Loan or Term Loan B, whichever is later, and
the Loans and all other Obligations shall be automatically due and payable in
full on such date.


 


9.2                               Survival of Obligations Upon Termination of Financing Arrangements


 


Except as otherwise expressly provided for in the Loan Documents, no
termination or cancellation (regardless of cause or procedure) of any financing
arrangement under this Agreement shall in any way affect or impair the
obligations, duties and liabilities of the Credit Parties or the rights of
Agent and Lenders relating to any unpaid portion of the Loans or any other
Obligations, due or not due, liquidated, contingent or unliquidated or any
transaction or event occurring prior to such termination, or any transaction or
event, the performance of which is required after the Commitment Termination
Date. Except as otherwise expressly provided herein or in any other Loan
Document, all undertakings, agreements, covenants, warranties and representations
of or binding upon the Credit Parties, and all rights of Agent and the Lenders,
all as contained in the Loan Documents, shall not terminate or expire, but
rather shall survive any such termination or cancellation and shall continue in
full force and effect until the Termination Date; provided, that the provisions
of Article XIII, the payment obligations under Sections 1.14 and 1.15, and
the indemnities contained in the Loan Documents shall survive the Termination
Date.


 


ARTICLE X


EVENTS OF DEFAULT; RIGHTS AND REMEDIES


 


10.1                        Events of Default


 


The occurrence of any one or more of the following events (regardless
of the reason therefor) shall constitute an “Event
of Default” hereunder:


 


(a)                                  Borrower (i) fails to
make any payment of principal of, or interest on, or Fees owing in respect of,
the Loans or any of the other Obligations when due and payable, or (ii) fails
to pay or reimburse any Lender for any expense reimbursable hereunder or under
any other Loan Document within ten (10) days following Agent’s demand for
such reimbursement or payment of expenses.


 


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(b)                                 Any Consolidated Party fails
or neglects to perform, keep or observe any of the provisions of Sections 1.6,
6.4(a), Article VII or Article VIII.


 


(c)                                  Borrower fails or neglects
to perform, keep or observe any of the provisions of Section 5.1, and the same
shall remain unremedied for three (3) Business Days or more.


 


(d)                                 Any Consolidated Party fails
or neglects to perform, keep or observe any other provision of this Agreement
or of any of the other Loan Documents (other than any provision embodied in or
covered by any other clause of this Section 10.1) and the same shall
remain unremedied for twenty (20) days or more.


 


(e)                                  A default or breach shall
occur under any other agreement, document or instrument to which any
Consolidated Party is a party that is not cured within any applicable grace
period therefor, and such default or breach (i) involves the failure to
make any payment when due in respect of any Indebtedness or Guaranteed
Indebtedness (other than the Obligations) of any Credit Party in excess of $500,000
in the aggregate (including (x) undrawn committed or available amounts and
(y) amounts owing to all creditors under any combined or syndicated credit
arrangements), or (ii) causes, or permits any holder of such Indebtedness
or Guaranteed Indebtedness or an agent or a trustee therefor to cause,
Indebtedness or Guaranteed Indebtedness or a portion thereof in excess of
$500,000 in the aggregate to become due prior to its stated maturity or prior
to its regularly scheduled dates of payment, or cash collateral to be demanded
in respect thereof, in each case, regardless of whether such default is waived,
or such right is exercised, by such holder, agent or trustee.


 


(f)                                    Any information contained in
any Borrowing Base Certificate is untrue or incorrect in any respect in the
aggregate in any Borrowing Base Certificate, or any representation or warranty
herein or in any Loan Document or in any written statement, report, financial
statement or certificate (other than a Borrowing Base Certificate) made or delivered
to Agent or any Lender by any Credit Party is untrue or incorrect in any
material respect as of the date when made or deemed made.


 


(g)                                 Assets of any Credit Party
are attached, seized, levied upon or subjected to execution, garnishment,
distress or any other similar process, or come within the possession of any
interim receiver, receiver, receiver and manager, trustee, custodian,
liquidator, administrator, sequestrator, sheriff, bailiff or assignee for the
benefit of creditors of any Credit Party and such condition continues for
thirty (30) days or more.


 


(h)                                 Any involuntary case or
proceeding (including the filing of any notice of intention in respect thereof)
is commenced against any Credit Party under any Insolvency Law, any
incorporation law or other applicable law in any jurisdiction in respect of
the:


 


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(i)                                     bankruptcy, liquidation,
winding-up, dissolution or suspension of general operations;


 


(i)                                     composition,
rescheduling, reorganization, arrangement or readjustment of, or other relief
from, or stay of proceedings to enforce, some or all of the debts or
obligations;


 


(ii)                                  appointment of a trustee,
interim receiver, receiver, receiver and manager, liquidator, administrator,
custodian, sequestrator, agent or other similar official for Borrower, or for
all or a substantial part of the assets of Borrower; or


 


(iii)                               possession, foreclosure,
seizure or retention, sale or other disposition of, or other proceedings to
enforce security over, all or any substantial part of the assets, of such
Credit Party and such case or proceeding shall remain undismissed or unstayed
for 30 days or more or such court shall enter a decree or order granting the
relief sought in such case or proceeding.


 


(iv)                              Any Credit Party (i) files
a petition or application seeking relief under any Insolvency Law, (ii) commences
or fails to contest in a timely and appropriate manner or consents to the
institution of any proceeding referred to in Sections 10.1(h) or 10.1(g) above
or to the filing of any such petition or to the appointment of or taking
possession by a custodian, receiver, interim receiver, receiver and manager,
liquidator, assignee, trustee or sequestrator (or similar official) of any
Credit Party or of all or any substantial part of any such Credit Party’s
assets, or (iii) makes an assignment for the benefit of creditors or (iv) takes
action in furtherance of any of the foregoing or of any of the proceedings
referred to in Sections 10.1(h) or 10.1(g), or (v) admits in writing
its inability to, or is generally unable to, pay its debts as such debts become
due or is otherwise insolvent.


 


(j)                                     A final judgment or
judgments for the payment of money in excess of $250,000 in the aggregate at
any time is entered or rendered against one or more of the Credit Parties
(which judgments are not covered by insurance policies as to which liability
has been accepted by the insurance carrier), and the same are not, within
thirty (30) days after the entry thereof, discharged or execution thereof
stayed or bonded pending appeal, or such judgments are not discharged prior to
the expiration of any such stay.


 


(k)                                  Any material provision of
any Loan Document for any reason ceases to be valid, binding and enforceable in
accordance with its terms (or any Credit Party or other Person Party to a Loan
Document shall challenge the enforceability of any Loan Document or shall
assert in writing, or engage in any action or inaction based on any such
assertion, that any provision of any of the Loan Documents has ceased


 


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to
be or otherwise is not valid, binding and enforceable in accordance with its
terms), or any Lien created under any Loan Document ceases to be a valid and
perfected, or becomes a prohibited, first priority or ranking Lien (except as
otherwise permitted herein or therein) in any of the Collateral purported to be
covered thereby.


 


(l)                                     Any Change of Control
occurs.


 


(m)                               Any event occurs, whether or
not insured or insurable, as a result of which revenue-producing activities
cease or are substantially curtailed at any facility or location of the
Corporation generating more than 25% of the Corporation’s revenues for the
Fiscal Year preceding such event and such cessation or curtailment continues
for more than thirty (30) days.


 


(n)                                 Any Credit Party defaults in
the observance or performance of any non-monetary obligation, covenant or
condition to be observed or performed by it pursuant to any agreement to which
it is a party, including the Material Documents, or by which any of its
property is bound, where such default could reasonably be expected to have a
Material Adverse Effect and such default continues for a period of 30 days
after notice thereof is given to the Borrower by the Agent.


 


10.2                        Remedies


 


(a)                                  If any Default or Event of
Default shall have occurred and be continuing, Agent may, and shall upon the
Requisite Lenders’ direction, without notice, suspend the Revolving Loan
facility with respect to additional Advances, whereupon any additional Advances
shall be made or extended in each Lender’s sole discretion so long as such
Default or Event of Default is continuing. If any Default or Event of Default
has occurred and is continuing, Agent may, and shall upon the Requisite Lenders’
direction, without notice except as otherwise expressly provided herein, and
subject to applicable statutory law, increase the rate of interest applicable
to the Revolving Loan, any Term Loans and Term Loan B to the Default Rate.


 


(b)                                 If any Event of Default has
occurred and is continuing, Agent may, and shall upon the Requisite Lenders’
direction, without notice: (i) terminate the Revolving Loan facility with
respect to further Advances or the incurrence of further letter of credit
obligations; (ii) reduce the Revolving Loan Commitment from time to time; (iii) declare
all or any portion of the Obligations, including all or any portion of the Term
Loan or Term Loan B to be forthwith due and payable, all without presentment,
demand, protest or further notice of any kind, all of which are expressly
waived by Borrower and each other Credit Party; or (iv) exercise any
rights and remedies provided to Agent under the Loan Documents or at law or
equity, including all remedies provided under the PPSA and other applicable
laws; provided, that upon the occurrence of an Event of Default specified in Section 10.1(h) or
10.1(i), the Commitments shall be immediately terminated and all of the
Obligations, including the Revolving Loan, Term Loan or Term Loan B


 


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(as
applicable), shall become immediately due and payable without declaration,
notice or demand by any Person.


 


(c)                                  If any Event of Default has
occurred and is continuing, Borrower shall, upon request of Agent, ensure that
the Assessed Equipment is: (i) cleaned in accordance with prudent industry
standards and all Environmental Laws and (ii) in marketable condition.


 


10.3                        Waivers by Credit Parties


 


Except
as otherwise provided for in this Agreement or by applicable law, each Credit
Party waives: (a) presentment, demand and protest and notice of
presentment, dishonor, notice of intent to accelerate, notice of acceleration,
protest, default, non-payment, maturity, release, compromise, settlement,
extension or renewal of any or all commercial paper, accounts, contract rights,
documents of title, instruments, chattel paper and guarantees at any time held
by Agent on which any Credit Party may in any way be liable, and hereby
ratifies and confirms whatever Agent may do in this regard, (b) all rights
to notice and a hearing prior to Agent’s taking possession or control of, or to
Agent’s replevy, attachment or levy upon, the Collateral or any bond or
security that might be required by any court prior to allowing Agent to
exercise any of its remedies, and (c) the benefit of all valuation,
appraisal, marshalling and exemption laws. 
All payments to be made by each Credit Party shall be made without
set-off or counterclaim and without deduction of any kind.


 


ARTICLE XI


ASSIGNMENT AND PARTICIPATIONS; APPOINTMENT OF AGENT


 


11.1                        Assignment and Participations


 


(a)                                  Right to Assign. Each Lender
may sell, transfer, negotiate or assign all or a portion of its rights and
obligations hereunder (including all or a portion of its Commitments and its
rights and obligations with respect to Loans) to (i) any existing Lender, (ii) any
Affiliate or Approved Fund of any existing Lender or (iii) any other
Person acceptable (which acceptance shall not be unreasonably withheld or
delayed) to Agent and, as long as no Event of Default is continuing, the
Borrower; provided, however, that (x) such sales do not have to be ratable
between the Loans but must be ratable among the Obligations owing to and owed
by such Lender with respect to a Loan and (y) for each Loan, the aggregate
outstanding principal amount (determined as of the effective date of the
applicable assignment) of the Loans and Commitments subject to any such Sale
shall be in a minimum amount of $1,000,000, unless such sale is made to an
existing Lender or an Affiliate or Approved Fund of any existing Lender, is of
the assignor’s (together with its Affiliates and Approved Funds) entire
interest in such Facility or is made with the prior consent of the Borrower and
Agent.


 


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(b)                                 Procedure. The parties
to each sale made in reliance on clause 11.1(a) above (other than those
described in clause 11.1(d) or 11.1(e) below) shall execute and
deliver to Agent an assignment agreement (an “Assignment
Agreement”) substantially in the form attached hereto as Exhibit 11.1(b) or
such other form acceptable to the Agent, acting reasonably, evidencing such
sale, together with any existing Note subject to such sale (or any affidavit of
loss therefor acceptable to Agent) and payment of an assignment fee in the
amount of $3,500, provided that (1) if a sale by a Lender is made to an
Affiliate or an Approved Fund of such assigning Lender, then no assignment fee
shall be due in connection with such sale, and (2) if a sale by a Lender
is made to an assignee that is not an Affiliate or Approved Fund of such
assignor Lender, and concurrently to one or more Affiliates or Approved Funds
of such assignee, then only one assignment fee of $3,500 shall be due in
connection with such sale. Upon receipt of all the foregoing, and conditioned
upon such receipt and, if such assignment is made in accordance with Section 11.1(a)(iii),
upon Agent (and the Borrower, if applicable) consenting to such assignment,
from and after the effective date specified in such Assignment Agreement the
assignee will be a Lender hereunder.


 


(c)                                  Effectiveness. Subject to
the recording of an Assignment Agreement by Agent, (i) the assignee
thereunder shall become a party hereto and, to the extent that rights and
obligations under the Loan Documents have been assigned to such assignee
pursuant to such Assignment Agreement, shall have the rights and obligations of
a Lender, (ii) any applicable Note shall be transferred to such assignee
through such entry and (iii) the assignor thereunder shall, to the extent
that rights and obligations under this Agreement have been assigned by it
pursuant to such Assignment Agreement, relinquish its rights (except for those
surviving the termination of the Commitments and the payment in full of the Obligations)
and be released from its obligations under the Loan Documents, other than those
relating to events or circumstances occurring prior to such assignment (and, in
the case of an assignment covering all or the remaining portion of an assigning
Lender’s rights and obligations under the Loan Documents, such Lender shall
cease to be a party hereto).


 


(d)                                 Grant of Security Interests. In addition
to the other rights provided in this Section 11.1, each Lender may grant a
security interest in, or otherwise assign as collateral, any of its rights
under this Agreement, whether now owned or hereafter acquired (including rights
to payments of principal or interest on the Loans), to (A) any federal
reserve bank (pursuant to Regulation A of the Federal Reserve Board), without
notice to Agent or (B) any holder of, or trustee for the benefit of the
holders of, such Lender’s securities by notice to Agent; provided, however,
that no such holder or trustee, whether because of such grant or assignment or
any foreclosure thereon (unless such foreclosure is made through an assignment
in accordance with clause (b) above), shall be entitled to any rights of
such Lender hereunder and no such Lender shall be relieved of any of its
obligations hereunder.


 


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(e)                                  Participants and SPVs. In addition
to the other rights provided in this 11.1, each Lender may, (x) with
notice to Agent, grant to an SPV the option to make all or any part of any Loan
that such Lender would otherwise be required to make hereunder (and the
exercise of such option by such SPV and the making of Loans pursuant thereto
shall satisfy the obligation of such Lender to make such Loans hereunder) and
such SPV may assign to such Lender the right to receive payment with respect to
any Obligation and (y) without notice to or consent from Agent or the
Borrower, sell participations to one or more Persons in or to all or a portion
of its rights and obligations under the Loan Documents; provided, however,
that, whether as a result of any term of any Loan Document or of such grant or
participation, (i) no such SPV or participant shall have a commitment, or
be deemed to have made an offer to commit, to make Loans hereunder, and, except
as provided in the applicable option agreement, none shall be liable for any
obligation of such Lender hereunder, (ii) such Lender’s rights and
obligations, and the rights and obligations of the Credit Parties towards such
Lender, under any Loan Document shall remain unchanged and each other party hereto
shall continue to deal solely with such Lender, which shall remain the holder
of the Obligations, except that (A) each such participant and SPV shall be
entitled to the benefit of Sections 1.15 (Capital Adequacy; Increased Costs;
Illegality) and 1.14 (Taxes), but only to the extent of any amount to which
such Lender would be entitled in the absence of any such grant or participation
and (B) each such SPV may receive other payments that would otherwise be
made to such Lender with respect to Loans funded by such SPV to the extent
provided in the applicable option agreement and set forth in a notice provided
to Agent by such SPV and such Lender, provided, however, that in no case
(including pursuant to clause (A) or (B) above) shall an SPV or
participant have the right to enforce any of the terms of any Loan Document,
and (iii) the consent of such SPV or participant shall not be required
(either directly, as a restraint on such Lender’s ability to consent hereunder
or otherwise) for any amendments, waivers or consents with respect to any Loan
Document or to exercise or refrain from exercising any powers or rights such
Lender may have under or in respect of the Loan Documents (including the right
to enforce or direct enforcement of the Obligations), except for those
described in Section 13.2(c)(ii) with respect to amounts, or dates
fixed for payment of amounts, to which such participant or SPV would otherwise
be entitled and, in the case of participants, except for those described in Section 13.2(c)(v).
No party hereto shall institute (and the Borrower shall cause each other Credit
Party not to institute) against any SPV grantee of an option pursuant to this
clause (f) any bankruptcy, reorganization, insolvency, liquidation or
similar proceeding, prior to the date that is one year and one day after the
payment in full of all outstanding commercial paper of such SPV; provided,
however, that each Lender having designated an SPV as such agrees to indemnify
each Indemnitee against any liability that may be incurred by, or asserted
against, such Indemnitee as a result of failing to institute such proceeding
(including a failure to get reimbursed by such SPV for any such liability). The


 


66

















 


agreement
in the preceding sentence shall survive the termination of the Commitments and
the payment in full of the Obligations.


 


11.2                        Appointment of Agent


 


GE
Canada is hereby appointed to act on behalf of all Lenders as Agent under this
Agreement and the other Loan Documents. The provisions of this Section 11.2
are solely for the benefit of Agent and the Lenders and no Credit Party nor any
other Person shall have any rights as a third party beneficiary of any of the
provisions hereof. In performing its functions and duties under this Agreement
and the other Loan Documents, Agent shall act solely as an agent of the Lenders
and does not assume, and shall not be deemed to have assumed, any obligation
toward or relationship of agency or trust with or for any Credit Party or any
other Person. Agent shall have no duties or responsibilities except for those
expressly set forth in this Agreement and the other Loan Documents. The duties
of Agent shall be mechanical and administrative in nature and Agent shall not
have, or be deemed to have, by reason of this Agreement, any other Loan
Document or otherwise a fiduciary relationship in respect of any other Lender.
Except as expressly set forth in this Agreement and the other Loan Documents,
Agent shall not have any duty to disclose, and shall not be liable for failure
to disclose, any information relating to any Credit Party or any of their
respective Subsidiaries or any Account Debtor that is communicated to or
obtained by GE Canada or any of its Affiliates in any capacity. Neither Agent
nor any of its Affiliates nor any of their respective officers, directors,
employees, agents or representatives shall be liable to any Lender for any
action taken or omitted to be taken by it hereunder or under any other Loan
Document, or in connection herewith or therewith, except for damages caused by
its or their own gross negligence or wilful misconduct.


 


If
Agent shall request instructions from Requisite Lenders or all affected Lenders
with respect to any act or action (including failure to act) in connection with
this Agreement or any other Loan Document, then Agent shall be entitled to
refrain from such act or taking such action unless and until Agent shall have
received instructions from Requisite Lenders or all affected Lenders, as the
case may be, and Agent shall not incur liability to any Person by reason of so
refraining. Agent shall be fully justified in failing or refusing to take any
action hereunder or under any other Loan Document (a) if such action
would, in the opinion of Agent, be contrary to law or the terms of this
Agreement or any other Loan Document, (b) if such action would, in the
opinion of Agent, expose Agent to Environmental Liabilities or (c) if
Agent shall not first be indemnified to its satisfaction against any and all
liability and expense which may be incurred by it by reason of taking or
continuing to take any such action. Without limiting the foregoing, no Lender
shall have any right of action whatsoever against Agent as a result of Agent
acting or refraining from acting hereunder or under any other Loan Document in
accordance with the instructions of Requisite Lenders or all affected Lenders,
as applicable.


 


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11.3                        Agent’s Reliance, Etc.


 


Neither Agent nor any of its Affiliates nor any of their respective
directors, officers, agents or employees shall be liable for any action taken
or omitted to be taken by it or them under or in connection with this Agreement
or the other Loan Documents, except for damages caused by its or their own gross
negligence or wilful misconduct. Without limiting the generality of the
foregoing, Agent: (a) may treat the payee of any Note as the holder
thereof until Agent receives written notice of the assignment or transfer
thereof signed by such payee and in form reasonably satisfactory to Agent; (b) may
consult with legal counsel, accountants and other experts selected by it and
shall not be liable for any action taken or omitted to be taken by it in good
faith in accordance with the advice of such counsel, accountants or experts; (c) makes
no warranty or representation to any Lender and shall not be responsible to any
Lender for any statements, warranties or representations made in or in
connection with this Agreement or the other Loan Documents; (d) shall not
have any duty to ascertain or to inquire as to the performance or observance of
any of the terms, covenants or conditions of this Agreement or the other Loan
Documents on the part of any Credit Party or to inspect the Collateral
(including the books and records) of any Credit Party; (e) shall not be
responsible to any Lender for the due execution, legality, validity,
enforceability, genuineness, sufficiency or value of this Agreement or the
other Loan Documents or any other instrument or document furnished pursuant
hereto or thereto; and (f) shall incur no liability under or in respect of
this Agreement or the other Loan Documents by acting upon any notice, consent,
certificate or other instrument or writing (which may be by telecopy, telegram,
cable or telex) believed by it to be genuine and signed or sent by the proper
party or parties.


 


11.4                        GE Canada and Affiliates


 


With respect to its Commitments hereunder, GE Canada shall have the
same rights and powers under this Agreement and the other Loan Documents as any
other Lender and may exercise the same as though it were not Agent; and the
term “Lender” or “Lenders” shall, unless otherwise expressly indicated, include
GE Canada in its individual capacity. GE Canada and its Affiliates may lend
money to, invest in, and generally engage in any kind of business with, any
Credit Party, any of their Affiliates and any Person who may do business with
or own securities of any Credit Party or any such Affiliate, all as if GE
Canada were not Agent and without any duty to account therefor to Lenders. GE
Canada and its Affiliates may accept fees and other consideration from any
Credit Party for services in connection with this Agreement or otherwise
without having to account for the same to Lenders. Each Lender acknowledges the
potential conflict of interest between GE Canada as a Lender holding
disproportionate interests in the Loans and GE Canada as Agent.


 


11.5                        Lender Credit Decision


 


Each Lender acknowledges that it has, independently and without
reliance upon Agent or any other Lender and based on the Financial Statements
referred to in Section 4.4(a) and such other documents and
information as it has deemed appropriate, made its own credit


 


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and
financial analysis of the Credit Parties and its own decision to enter into
this Agreement.  Each Lender also
acknowledges that it will, independently and without reliance upon Agent or any
other Lender and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in taking or
not taking action under this Agreement. 
Each Lender acknowledges the potential conflict of interest of each
other Lender as a result of Lenders holding disproportionate interests in the
Loans, and expressly consents to, and waives any claim based upon, such
conflict of interest.


 


11.6                        Indemnification


 


Lenders agree to indemnify Agent (to the extent not reimbursed by
Credit Parties and without limiting the obligations of any Credit Party
hereunder), rateably according to their respective Pro Rata Shares, from and
against any and all liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements of any kind or
nature whatsoever that may be imposed on, incurred by, or asserted against
Agent in any way relating to or arising out of this Agreement or any other Loan
Document or any action taken or omitted to be taken by Agent in connection
therewith (including without limitation any Environmental Liabilities);
provided, that no Lender shall be liable for any portion of such liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements resulting from Agent’s gross negligence or wilful
misconduct. Without limiting the foregoing, each Lender agrees to reimburse
Agent promptly upon demand for its rateable share of any out-of-pocket expenses
(including reasonable legal costs) incurred by Agent in connection with the
preparation, execution, delivery, administration, modification, amendment or
enforcement (whether through negotiations, legal proceedings or otherwise) of,
or legal advice in respect of rights or responsibilities under, this Agreement
and each other Loan Document, to the extent that Agent is not reimbursed for
such expenses by Credit Parties.


 


11.7                        Successor Agent


 


Agent may resign at any time by giving not less than thirty (30) days’
prior written notice thereof to Lenders and Borrower. Upon any such
resignation, the Requisite Lenders shall have the right to appoint a successor
Agent. If no successor Agent shall have been so appointed by the Requisite
Lenders and shall have accepted such appointment within thirty (30) days after
the resigning Agent’s giving notice of resignation, then the resigning Agent
may, on behalf of the Lenders, appoint a successor Agent, which shall be a
Lender, if a Lender is willing to accept such appointment, or otherwise shall
be a commercial bank or financial institution or other entity whose business
includes making commercial loans, in each case, organized under the laws of
Canada or of any province thereof or named in Schedule III to the Bank Act (Canada) and has a combined
capital and surplus of at least $100,000,000. If no successor Agent has been
appointed pursuant to the foregoing, within thirty (30) days after the date
such notice of resignation was given by the resigning Agent, such resignation
shall become effective and the Requisite Lenders shall thereafter perform all
the duties of Agent hereunder until such time, if any, as the Requisite Lenders
appoint a successor Agent as provided above. Any successor Agent


 


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appointed
by Requisite Lenders hereunder shall be subject to the approval of Borrower,
such approval not to be unreasonably withheld or delayed; provided, that such
approval shall not be required if a Default or an Event of Default has occurred
and is continuing. Upon the acceptance of any appointment as Agent hereunder by
a successor Agent, such successor Agent shall succeed to and become vested with
all the rights, powers, privileges and duties of the resigning Agent. Upon the
earlier of the acceptance of any appointment as Agent hereunder by a successor
Agent or the effective date of the resigning Agent’s resignation, the resigning
Agent shall be discharged from its duties and obligations under this Agreement
and the other Loan Documents, except that any indemnity rights or other rights
in favour of such resigning Agent shall continue. After any resigning Agent’s
resignation hereunder, the provisions of this Article XI shall inure to
its benefit as to any actions taken or omitted to be taken by it while it was
acting as Agent under this Agreement and the other Loan Documents.


 


11.8                        Setoff and Sharing of Payments


 


In
addition to any rights now or hereafter granted under applicable law and not by
way of limitation of any such rights, upon the occurrence and during the
continuance of any Event of Default, and subject to Section 11.9(f), each
Lender is hereby authorized at any time or from time to time, without notice to
any Credit Party or to any other Person other than Agent, any such notice being
hereby expressly waived, to offset and to appropriate and to apply any and all
balances held by it at any of its offices for the account of Borrower or any
Credit Party (regardless of whether such balances are then due to Borrower or
any Credit Party) and any other properties or assets at any time held or owing
by that Lender or that holder to or for the credit or for the account of
Borrower or any Credit Party against and on account of any of the Obligations
that are not paid when due; provided that the Lender exercising such offset
rights shall give notice thereof to the affected Credit Party promptly after
exercising such rights.  Any Lender
exercising a right of setoff or otherwise receiving any payment on account of
the Obligations in excess of its Pro Rata Share thereof shall purchase for cash
(and the other Lenders or holders shall sell) such participations in each such
other Lender’s or holder’s Pro Rata Share of the Obligations as would be
necessary to cause such Lender to share the amount so offset or otherwise
received with each other Lender or holder in accordance with their respective
Pro Rata Shares, (other than offset rights exercised by any Lender with respect
to Section 1.15). Each Lender’s obligation under this Section 11.8
shall be in addition to and not in limitation of its obligations to purchase a
participation in an amount equal to its Pro Rata Share of the Revolving Loan
under Section 1.3(g). Borrower and each other Credit Party agrees, to the
fullest extent permitted by law, that (a) any Lender may exercise its
right to offset with respect to amounts in excess of its Pro Rata Share of the
Obligations and may sell participations in such amounts so offset to other
Lenders and holders and (b) any Lender so purchasing a participation in
the Loans made or other Obligations held by other Lenders or holders may
exercise all rights of offset, bankers’ lien, counterclaim or similar rights
with respect to such participation as fully as if such Lender or holder were a
direct holder of the Loans and the other Obligations in the amount of such
participation. Notwithstanding the foregoing, if all or any portion of the


 


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offset
amount or payment otherwise received is thereafter recovered from the Lender
that has exercised the right of offset, the purchase of participations by that
Lender shall be rescinded and the purchase price restored without interest.


 


11.9        Advances; Payments; Non-Funding Lenders; Information; Actions in Concert


 


(a)           Settlement Date. Not less than once during
each calendar week or more frequently at Agent’s election (each, a “Settlement Date”), Agent shall advise each
Lender by telephone, or telecopy of the amount of such Lender’s Pro Rata Share
of principal, interest and Fees paid for the benefit of Lenders with respect to
each applicable Loan. Provided that each Lender has funded all payments and
Advances required to be made by it and purchased all participations required to
be purchased by it under this Agreement and the other Loan Documents as of such
Settlement Date, Agent shall pay to each Lender such Lender’s Pro Rata Share of
principal, interest and Fees paid by Borrower since the previous Settlement
Date for the benefit of such Lender on the Loans held by it. To the extent that
any Lender (a “Non-Funding Lender”)
has failed to fund all such payments and Advances or failed to fund the
purchase of all such participations, Agent shall be entitled to set off the
funding short fall against that Non-Funding Lender’s Pro Rata Share of all
payments received from Borrower. Such payments shall be made by wire transfer
to such Lender’s account (as specified by such Lender in Annex B or the
applicable Assignment Agreement) not later than 2:00 p.m. (Toronto time)
on the next Business Day following each Settlement Date.


 


(b)           Availability of Lender’s Pro Rata Share. Agent may
assume that each Lender will make its Pro Rata Share of the Term Loan B Advance
and each Revolving Credit Advance available to Agent on each funding date. If
such Pro Rata Share is not, in fact, paid to Agent by such Lender when due,
Agent will be entitled to recover such amount on demand from such Lender
without setoff, counterclaim or deduction of any kind. If any Lender fails to
pay the amount of its Pro Rata Share forthwith upon Agent’s demand, Agent shall
promptly notify Borrower and Borrower shall immediately repay such amount to
Agent. Nothing in this Section 11.9(b) or elsewhere in this Agreement
or the other Loan Documents shall be deemed to require Agent to advance funds
on behalf of any Lender or to relieve any Lender from its obligation to fulfill
its Commitments hereunder or to prejudice any rights that Borrower may have
against any Lender as a result of any default by such Lender hereunder. To the
extent that Agent advances funds to Borrower on behalf of any Lender and is not
reimbursed therefor on the same Business Day as such Revolving Credit Advance
or Term Loan B Advance is made, Agent shall be entitled to retain for its
account all interest accrued on such Revolving Credit Advance or Term Loan B
Advance until reimbursed by the applicable Lender.


 


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(c)           Return of Payments


 


(i)            If Agent pays an amount to a Lender under this
Agreement in the belief or expectation that a related payment has been or will
be received by Agent from Borrower and such related payment is not received by
Agent, then Agent will be entitled to recover such amount from such Lender on
demand without setoff, counterclaim or deduction of any kind.


 


(ii)           If Agent determines at any time that any amount
received by Agent under this Agreement must be returned to Borrower or paid to
any other Person pursuant to any insolvency law or otherwise, then,
notwithstanding any other term or condition of this Agreement or any other Loan
Document, Agent will not be required to distribute any portion thereof to any
Lender. In addition, each Lender will repay to Agent on demand any portion of
such amount that Agent has distributed to such Lender, together with interest
at such rate, if any, as Agent is required to pay to Borrower or such other
Person, without setoff, counterclaim or deduction of any kind.


 


(d)           Non-Funding Lenders. The failure of any
Non-Funding Lender to make any Revolving Credit Advance or Term Loan B Advance
or any payment required by it hereunder on the date specified therefor shall
not relieve any other Lender (each such other Lender, an “Other Lender”) of its obligations to make
such Revolving Credit Advance, Term Loan B Advance or other payment or purchase
such participation on such date, but neither any Other Lender nor Agent shall
be responsible for the failure of any Non-Funding Lender to make a Revolving
Credit Advance or Term Loan B Advance, purchase a participation or make any
other payment required hereunder. Notwithstanding anything set forth herein to
the contrary, a Non-Funding Lender shall not have any voting or consent rights
under or with respect to any Loan Document or constitute a “Lender”, “Revolving
Lender” or “Term Loan B Lender” (or be included in the calculation of “Requisite
Lenders” hereunder) for any voting or consent rights under or with respect to
any Loan Document. At Borrower’s request, Agent or a Person acceptable to Agent
shall have the right, with Agent’s consent and in Agent’s sole discretion (but
shall have no obligation), to purchase from any Non-Funding Lender, and each
Non-Funding Lender agrees that it shall, at Agent’s request, sell and assign to
Agent or such Person, all of the Commitments of that Non-Funding Lender for an
amount equal to the principal balance of all Loans held by such Non-Funding
Lender and all accrued interest and fees with respect thereto through the date of
sale, such purchase and sale to be consummated pursuant to an executed
Assignment Agreement.


 


(e)           Dissemination of Information. Agent shall
use reasonable efforts to provide Lenders with (i) any notice of Default
or Event of Default received by Agent from, or delivered by Agent to, any
Credit Party, (ii) with notice of any Event of Default of which Agent has
actually become aware, (iii) with notice of any action


 


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taken
by Agent following any Event of Default, and (iv) with any other
documentation provided by any Credit Party to Agent in accordance with the
terms of this Agreement; provided, that Agent shall not be liable to any Lender
for any failure to do so, except to the extent that such failure is attributable
to Agent’s gross negligence or wilful misconduct.  Lenders acknowledge that Borrower is required
to provide Financial Statements and Collateral Reports to Lenders in accordance
with Section 5.1 and agree that Agent shall have no duty to provide the
same to Lenders.


 


(f)            Actions in Concert. Anything in
this Agreement to the contrary notwithstanding, each Lender hereby agrees with
Agent and each other Lender that no Lender shall take any action to protect or
enforce its rights arising out of this Agreement or the Notes (including
exercising any rights of setoff) without first obtaining the prior written
consent of Agent and Requisite Lenders, it being the intent of Lenders that any
such action to protect or enforce rights under this Agreement and the Notes
shall be taken in concert and at the direction or with the consent of Agent or
Requisite Lenders


 


11.10      Lead
Arrangers, Co-Syndication Agents and Documentation Agent


 


Notwithstanding
anything else to the contrary in any Loan Document, the Lead Arrangers,
Co-Syndication Agents and Documentation Agent shall have no rights,
obligations, duties or liabilities whatsoever in such capacity under any Loan
Document.


 


ARTICLE XII


SUCCESSORS AND ASSIGNS


 


12.1        Successors
and Assigns


 


This
Agreement and the other Loan Documents shall be binding on and shall inure to
the benefit of each Credit Party, the Lenders and their respective successors
and assigns (including, to the extent applicable in the case of any Credit
Party, a debtor-in-possession on behalf of such Credit Party), except as
otherwise provided herein or therein.  No
Credit Party may assign, transfer, hypothecate or otherwise convey its rights,
benefits, obligations or duties hereunder or under any of the other Loan
Documents without the prior express written consent of Agent and Lenders.  Any such purported assignment, transfer,
hypothecation or other conveyance by any Credit Party without the prior express
written consent of Agent and Lenders shall be void. The terms and provisions of
this Agreement are for the purpose of defining the relative rights and
obligations of each Credit Party, Agent and the Lenders with respect to the
transactions contemplated hereby and no Person (other than a participant in the
Loans being made available hereunder, as provided in Article XI) shall be
a third party beneficiary of any of the terms and provisions of this Agreement
or any of the other Loan Documents.


 


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ARTICLE XIII


MISCELLANEOUS


 


13.1        Complete
Agreement; Modification of Agreement


 


The Loan Documents constitute the complete agreement between the
parties with respect to the subject matter thereof and may not be modified,
altered or amended except as set forth in Section 13.2. Any letter of
interest, commitment letter, fee letter or confidentiality agreement, if any,
between any Credit Party and any Lender or any of their respective Affiliates,
predating this Agreement and relating to a financing of substantially similar
form, purpose or effect shall be superseded by this Agreement. Notwithstanding
the foregoing, the GE Fee Letter and any market flex provisions contained in
the final commitment letter between Agent and Borrower shall survive the
execution and delivery of this Agreement and shall continue to be binding
obligations of the parties.


 


13.2        Amendments
and Waivers


 


(a)           Except for actions expressly permitted to be taken
by Agent, no amendment, modification, termination or waiver of any provision of
this Agreement or any other Loan Document, or any consent to any departure by
any Credit Party therefrom, shall in any event be effective unless the same
shall be in writing and signed by Agent and Borrower, and by Requisite Lenders
or all affected Lenders, as applicable. Except as set forth in clauses (b) and
(c) below, all such amendments, modifications, terminations or waivers
requiring the consent of any Lenders shall require the written consent of
Requisite Lenders.


 


(b)           No amendment, modification, termination or waiver of
or consent with respect to any provision of this Agreement that waives
compliance with the conditions precedent set forth in Section 2.2 to the
making of any Loan shall be effective unless the same shall be in writing and
signed by Agent, Requisite Lenders and Borrower. Notwithstanding anything
contained in this Agreement to the contrary, no waiver or consent with respect
to any Default or any Event of Default shall be effective for purposes of the
conditions precedent to the making of Loans set forth in Section 2.2
unless the same shall be in writing and signed by Agent, Requisite Lenders and
Borrower.


 


(c)           No amendment, modification, termination or waiver
shall, unless in writing and signed by Agent and each Lender directly affected
thereby: (i) increase the principal amount of any Lender’s Commitment
(which action shall be deemed to directly affect all Lenders); (ii) reduce
the principal of, rate of interest on or Fees payable with respect to any Loan
of any affected Lender; (iii) extend any scheduled payment date (other
than payment dates of mandatory prepayments under Section 1.4(d)) or final
maturity date of the principal amount of the Term Loan or Term Loan B; (iv) waive,
forgive, defer, extend or postpone any payment of interest or Fees as to any
affected Lender; (v) release any Guarantee or, except


 


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as
otherwise permitted herein or in the other Loan Documents, release, or permit
any Credit Party to sell or otherwise dispose of, any Collateral other than as
permitted pursuant to Section 7.9 of this Agreement (which action shall be
deemed to directly affect all Lenders); (vi) change the percentage of the
Commitments or of the aggregate unpaid principal amount of the Loans that shall
be required for Lenders or any of them to take any action hereunder; (vii) amend
or waive this Section 13.2 or the definition of the term “Requisite Lender”
insofar as such definition affects the substance of this Section 13.2; and
(viii) extend the Revolving Period (except in accordance with Section 1.2(c)).  Furthermore, no amendment, modification,
termination or waiver affecting the rights or duties of Agent under this
Agreement or any other Loan Document shall be effective unless in writing and
signed by Agent, as the case may be, in addition to Lenders required
hereinabove to take such action. No amendment, modification or waiver of this
Agreement or any other Loan Document altering the ratable treatment of
Obligations arising under Secured Rate Contracts resulting in such Obligations
being junior in right of payment to principal on the Loans, or resulting in
Obligations owing to any Secured Swap Provider becoming unsecured (other than
releases of Liens permitted in accordance with the terms hereof), in each case
in a manner adverse to any Secured Swap Provider, shall be effective without
the written consent of such Secured Swap Provider, or, in the case of a Secured
Rate Contract provided or arranged by GE Capital or an Affiliate of GE Capital,
GE Capital. Each amendment, modification, termination or waiver shall be
effective only in the specific instance and for the specific purpose for which
it was given. No amendment, modification, termination or waiver shall be
required for Agent to take additional Collateral pursuant to any Loan Document.  No notice to or demand on any Credit Party in
any case shall entitle such Credit Party or any other Credit Party to any other
or further notice or demand in similar or other circumstances.


 


(d)           If, in connection with any proposed amendment,
modification, waiver or termination (a “Proposed
Change”) requiring the consent of all affected Lenders and the
consent of Requisite Lenders is obtained, but the consent of other Lenders
whose consent is required is not obtained (a “Non-Consenting
Lender”), then, so long as Agent is not a Non-Consenting Lender, at
Borrower’s request, Agent, or a Person reasonably acceptable to Agent, shall
have the right, with Agent’s consent and in Agent’s sole discretion (but shall
have no obligation), to purchase from such Non-Consenting Lenders, and such
Non-Consenting Lenders agree that they shall, upon Agent’s request, sell and
assign to Agent or such Person, all of the Commitments of such Non-Consenting
Lenders for an amount equal to the principal balance of all Loans held by the
Non-Consenting Lenders and all accrued interest and Fees with respect thereto
through the date of sale, such purchase and sale to be consummated pursuant to
an executed Assignment Agreement.


 


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(e)           Upon the indefeasible payment in full in cash and
performance of all of the Obligations (other than indemnification Obligations),
termination of the Commitments and a release of all claims against Agent and
Lenders, and so long as no suits, actions proceedings, or claims are pending or
threatened against any Indemnified Person asserting any damages, losses or
liabilities that are Indemnified Liabilities, Agent shall deliver to Borrower
financing change statements, mortgage releases and other documents or
instruments necessary or appropriate to evidence the termination of the Liens
securing payment of the Obligations.


 


13.3        Fees and
Expenses


 


Borrower shall reimburse (i) Agent for all fees, costs and
expenses (including the reasonable fees and expenses of all of its legal
counsel, advisors, consultants and auditors) and (ii) Agent (and, with
respect to clauses (c) through (d) below, all Lenders) for all fees,
costs and expenses, including the reasonable fees, costs and expenses of legal
counsel or other advisors (including environmental and management consultants
and appraisers) incurred in connection with the negotiation, preparation and
filing and/or recordation of the Loan Documents and incurred in connection
with:


 


(a)           any amendment, modification or waiver of, or consent
with respect to, or termination of, any of the Loan Documents or advice in
connection with administration of the Loans made pursuant hereto or its rights
hereunder or thereunder;


 


(b)           any litigation, contest, dispute, suit, proceeding
or action (whether instituted by Agent, any Lender, any Credit Party or any
other Person and whether as a party, witness or otherwise) in any way relating
to the Collateral, any of the Loan Documents or any other agreement to be
executed or delivered in connection herewith or therewith, including any
litigation, contest, dispute, suit, case, proceeding or action, and any appeal
or review thereof, in connection with a case commenced by or against any or all
of the Credit Parties or any other Person that may be obligated to the Lenders
by virtue of the Loan Documents, including any such litigation, contest,
dispute, suit, proceeding or action arising in connection with any work-out or
restructuring of the Loans during the pendency of one or more Events of
Default; provided that in the case of reimbursement of counsel for Lenders
other than Agent, such reimbursement shall be limited to one counsel for all
such Lenders; provided, further, that no Person shall be entitled to
reimbursement under this clause (b) in respect of any litigation, contest,
dispute, suit, proceeding or action to the extent any of the foregoing results
from such Person’s gross negligence or wilful misconduct;


 


(c)           any attempt to enforce any remedies of Agent or any
Lender against any or all of the Credit Parties or any other Person that may be
obligated to Agent or any Lender by virtue of any of the Loan Documents,
including any such attempt to enforce any such remedies in the course of any
work-out or restructuring of the


 


76

















 


Loans
during the pendency of one or more Events of Default; provided, that in the
case of reimbursement of counsel for Lenders other than Agent, such
reimbursement shall be limited to one counsel for all such Lenders;


 


(d)           any work-out or restructuring of the Loans during
the pendency of one or more Events of Default; and


 


(e)           efforts to (i) monitor the Loans or any of the
other Obligations, (ii) evaluate, observe or assess any of the Credit
Parties or their respective affairs, and (iii) verify, protect, evaluate,
assess, appraise, collect, sell, liquidate or otherwise dispose of any of the
Collateral;


 


including,
as to each of clauses (a) through (e) above, all reasonable legal
counsels’ and other professional and service providers’ fees arising from such
services and other advice, assistance or other representation, including those
in connection with any appellate proceedings, and all expenses, costs, charges
and other fees incurred by such legal counsel and others in any way or respect
arising in connection with or relating to any of the events or actions
described in this Section 13.3, all of which shall be payable, on demand,
by Borrower to Agent. Without limiting the generality of the foregoing, such
expenses, costs, charges and fees may include: fees, costs and expenses of
accountants, environmental advisors, appraisers, investment bankers, management
and other consultants and paralegals; court costs and expenses; photocopying
and duplication expenses; court reporter fees, costs and expenses; long distance
telephone charges; air express charges; telegram or telecopy charges;
secretarial overtime charges; and expenses for travel, lodging and food paid or
incurred in connection with the performance of such legal or other advisory
services.


 


Notwithstanding
the foregoing, the Lender acknowledges that no payment of fees pursuant to this
Section 13.3 shall by itself constitute agreement by the Borrower that
such fees (at the time of payment) are properly reimbursable pursuant to this
Agreement.


 


13.4        No Waiver


 


Agents
or a Lender’s failure, at any time or times, to require strict performance by
the Credit Parties of any provision of this Agreement or any other Loan
Document shall not waive, affect or diminish any right of Agent or such Lender
thereafter to demand strict compliance and performance herewith or
therewith.  Any suspension or waiver of
an Event of Default shall not suspend, waive or affect any other Event of
Default whether the same is prior or subsequent thereto and whether the same or
of a different type. Subject to the provisions of Section 13.2, none of
the undertakings, agreements, warranties, covenants and representations of any
Credit Party contained in this Agreement or any of the other Loan Documents and
no Default or Event of Default by any Credit Party shall be deemed to have been
suspended or waived by Agent or any Lender, unless such waiver or suspension is
by an instrument in writing signed by an officer of or other authorized
employee of Agent and the applicable required Lenders and directed to Borrower
specifying such suspension or waiver.


 


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13.5        Remedies


 


The rights and remedies available to Agent and the Lenders under this
Agreement shall be cumulative and nonexclusive of any other rights and remedies
that Agent or any Lender may have under any other agreement, including the
other Loan Documents, by operation of law or otherwise. Recourse to the
Collateral shall not be required.


 


13.6        Severability


 


Wherever possible, each provision of this Agreement and the other Loan
Documents shall be interpreted in such a manner as to be effective and valid
under applicable law, but if any provision of this Agreement or any other Loan
Document shall be prohibited by or invalid under applicable law, such provision
shall be ineffective only to the extent of such prohibition or invalidity,
without invalidating the remainder of such provision or the remaining
provisions of this Agreement or such other Loan Document.


 


13.7        Conflict of
Terms


 


Except as otherwise provided in this Agreement or any of the other Loan
Documents by specific reference to the applicable provisions of this Agreement,
if any provision contained in this Agreement conflicts with any provision in
any of the other Loan Documents, the provision contained in this Agreement
shall govern and control.


 


13.8        Confidentiality


 


Agent and the Lenders agree to use commercially reasonable efforts
(equivalent to the efforts Agent or Lenders applies to maintain the
confidentiality of their own confidential information) to maintain as
confidential all confidential information provided to them by the Credit
Parties and designated as confidential until the date that all obligations
under this agreement have been paid or satisfied in full, plus a period of two (2) years
(the “Confidentiality Termination Date”).
On the Confidentiality Termination Date the Agent and the Lenders agree to
either destroy all confidential information provided to them or return it to
the applicable Credit Party.


 


Notwithstanding the foregoing, Agent and each Lender may retain or
disclose such information to the extent that (a) disclosure is made to
Persons employed or engaged by Agent or such Lender; (b) disclosure is
made to any bona fide assignee or
participant or potential assignee or participant that has agreed to comply with
the covenant contained in this Section 13.8 (and any such bona fide assignee or participant or
potential assignee or participant may disclose such information to Persons
employed or engaged by them as described in clause (a) above); (c) disclosure
or retention is required or requested by any Governmental Authority or
reasonably believed Agent or such Lender to be compelled by any court order,
subpoena or legal or administrative order or process; (d) disclosure or
retention is required by law; (e) disclosure or retention is required, in
the Agent or such Lender’s sole discretion, in connection with the exercise of
any right or remedy under the Loan Documents or in connection with any
Litigation to which Agent or such Lender is a


 


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party; or (f) the confidential information ceases to be
confidential through no fault of Lender.


 


13.9        Governing
Law


 


EXCEPT AS OTHERWISE EXPRESSLY PROVIDED IN ANY OF THE LOAN DOCUMENTS, IN
ALL RESPECTS, INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE,
THE LOAN DOCUMENTS AND THE OBLIGATIONS SHALL BE GOVERNED BY, AND CONSTRUED AND
ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE PROVINCE OF ALBERTA APPLICABLE TO
CONTRACTS MADE AND PERFORMED IN THAT PROVINCE AND THE FEDERAL LAWS OF CANADA
APPLICABLE THEREIN. EACH CREDIT PARTY HEREBY CONSENTS AND AGREES THAT THE
COURTS OF THE PROVINCE OF ALBERTA SHALL HAVE NON-EXCLUSIVE JURISDICTION TO HEAR
AND DETERMINE ANY CLAIMS OR DISPUTES BETWEEN THE CREDIT PARTIES, AGENT AND
LENDERS PERTAINING TO THIS AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS OR TO
ANY MATTER ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OF THE OTHER
LOAN DOCUMENTS. NOTHING IN THIS AGREEMENT SHALL BE DEEMED OR OPERATE TO
PRECLUDE AGENT FROM BRINGING SUIT OR TAKING OTHER LEGAL ACTION IN ANY OTHER
JURISDICTION TO REALIZE ON THE COLLATERAL OR ANY OTHER SECURITY FOR THE
OBLIGATIONS, OR TO ENFORCE A JUDGMENT OR OTHER COURT ORDER. EACH CREDIT PARTY
EXPRESSLY SUBMITS AND CONSENTS IN ADVANCE TO SUCH JURISDICTION IN ANY ACTION OR
SUIT COMMENCED IN ANY SUCH COURT, AND EACH CREDIT PARTY HEREBY WAIVES ANY
OBJECTION THAT SUCH CREDIT PARTY MAY HAVE BASED UPON LACK OF PERSONAL
JURISDICTION, IMPROPER VENUE OR FORUM NON CONVENIENS AND HEREBY CONSENTS TO THE
GRANTING OF SUCH LEGAL OR EQUITABLE RELIEF AS IS DEEMED APPROPRIATE BY SUCH
COURT. EACH CREDIT PARTY HEREBY WAIVES PERSONAL SERVICE OF THE SUMMONS,
COMPLAINT AND OTHER PROCESS ISSUED IN ANY SUCH ACTION OR SUIT AND AGREES THAT
SERVICE OF SUCH SUMMONS, COMPLAINTS AND OTHER PROCESS MAY BE MADE BY
REGISTERED MAIL (RETURN RECEIPT REQUESTED) ADDRESSED TO SUCH CREDIT PARTY AT
THE ADDRESS SET FORTH IN Annex C OF THIS AGREEMENT AND THAT SERVICE SO MADE
SHALL BE DEEMED COMPLETED UPON THE EARLIER OF SUCH CREDIT PARTY’S ACTUAL
RECEIPT THEREOF OR THREE (3) DAYS AFTER DEPOSIT WITH CANADA POST, PROPER
POSTAGE PREPAID.


 


13.10      Notices


 


Except as otherwise provided herein, whenever it is provided herein
that any notice, demand, request, consent, approval, declaration or other
communication shall or may be given to or served upon any of the parties by any
other parties, or whenever any of the parties desires to give or serve upon any
other parties any communication with respect to


 


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this Agreement, each such notice, demand, request, consent, approval,
declaration or other communication shall be in writing and shall be deemed to
have been validly served, given or delivered (a) upon the earlier of
actual receipt and three (3) Business Days after deposit with Canada Post,
registered mail, return receipt requested, with proper postage prepaid, (b) upon
transmission, when sent by telecopy or other similar facsimile transmission
(with such telecopy or facsimile promptly confirmed by delivery of a copy by
personal delivery or with Canada Post as otherwise provided in this Section 13.10);
(c) upon receipt, when sent by electronic mail (with such electronic mail
promptly confirmed by delivery of a copy by personal delivery or Canada Post as
otherwise provided in this Section 13.10 and such notice, demand, request,
consent, approval, declaration or other communication shall be in “pdf” format
and shall include the actual signature of the party sending such communication if
that signature would be required or customary if the communication was
delivered by facsimile; (d) one (1) Business Day after deposit with a
reputable courier for overnight delivery with all charges prepaid or (e) when
delivered, if hand delivered by messenger, all of which shall be addressed to
the party to be notified and sent to the address or facsimile number indicated
on Annex C or to such other address (or facsimile number) as may be substituted
by notice given as herein provided. The giving of any notice required hereunder
may be waived in writing by the party entitled to receive such notice.  Failure or delay in delivering copies of any
notice, demand, request, consent, approval, declaration or other communication
to any Person (other than Borrower or Agent) designated in Annex C to receive
copies shall in no way adversely affect the effectiveness of such notice,
demand, request, consent, approval, declaration or other communication.


 


13.11      Section Titles


 


The Section titles and table of contents contained in this
Agreement are and shall be without substantive meaning or content of any kind
whatsoever and are not a part of the agreement between the parties hereto.


 


13.12      Counterparts


 


This Agreement may be executed in any number of separate counterparts,
each of which shall collectively and separately constitute one agreement.


 


13.13      Press
Releases and Related Matters


 


Each Credit Party agrees that neither it nor its Affiliates will in the
future issue any press releases or other public disclosure using the name of
any Lender or their affiliates or referring to this Agreement or the other Loan
Documents without at least two (2) Business Days’ prior notice to the
affected Lenders and without the prior written consent of such Lenders unless
(and only to the extent that) such Credit Party or Affiliate is required to do
so under law and then, in any event, such Credit Party or Affiliate will
consult with such Lenders before issuing such press release or other public
disclosure. Each Credit Party consents to the publication by Agent or any
Lender of advertising material relating to the financing transactions
contemplated by this Agreement using its


 


80
















 


name,
product photographs, logo or trademark. 
Agent or such Lender shall provide a draft of any advertising material
to Borrower for review and comment prior to the publication thereof. Agent and
each Lender reserves the right to provide to industry trade organizations
information necessary and customary for inclusion in league table measurements.


 


13.14                 Reinstatement


 


This Agreement shall remain in full force and effect and continue to be
effective should any petition or other proceeding be filed by or against any
Credit Party for liquidation or reorganization, should any Credit Party become
insolvent or make an assignment for the benefit of any creditor or creditors or
should an interim receiver, receiver, receiver and manger or trustee be
appointed for all or any significant part of any Credit Party’s assets, and
shall continue to be effective or to be reinstated, as the case may be, if at
any time payment and performance of the Obligations, or any part thereof, is,
pursuant to applicable law, rescinded or reduced in amount, or must otherwise
be restored or returned by any obligee of the Obligations, whether as a
fraudulent preference reviewable transaction or otherwise, all as though such
payment or performance had not been made. In the event that any payment, or any
part thereof, is rescinded, reduced, restored or returned, the Obligations
shall be reinstated and deemed reduced only by such amount paid and not so
rescinded, reduced, restored or returned.


 


13.15                 Advice of Counsel


 


Each of the parties represents to each other party hereto that it has
discussed this Agreement and, specifically, the provisions of Section 13.9,
with its counsel.


 


13.16                 No Strict Construction


 


The parties hereto have participated jointly in the negotiation and
drafting of this Agreement. In the event an ambiguity or question of intent or
interpretation arises, this Agreement shall be construed as if drafted jointly
by the parties hereto and no presumption or burden of proof shall arise
favouring or disfavouring any party by virtue of the authorship of any
provisions of this Agreement.


 


13.17                 Judgment Currency


 


(a)                                  If, for the purpose of
obtaining or enforcing judgment against any Credit Party in any court in any
jurisdiction, it becomes necessary to convert into any other currency (such
other currency being hereinafter in this Section 13.17 referred to as the “Judgment Currency”) an amount due under any
Loan Document in any currency (the “Obligation
Currency”) other than the Judgment Currency, the conversion shall be
made at the Rate of Exchange prevailing on the Business Day immediately
preceding the date of actual payment of the amount due, in the case of any
proceeding in the courts of the Province of Alberta or in the courts of any
other jurisdiction that will give effect to such conversion being made on such


 


81

















 


date,
or the date on which the judgment is given, in the case of any proceeding in
the courts of any other jurisdiction (the applicable date as of which such
conversion is made pursuant to this Section 13.17 being hereinafter in
this Section 13.17 referred to as the “Judgment
Conversion Date”).


 


(b)                                 If, in the case of any
proceeding in the court of any jurisdiction referred to in Section 13.17(a),
there is a change in the Rate of Exchange prevailing between the Judgment
Conversion Date and the date of actual receipt for value of the amount due, the
applicable Credit Party or Parties shall pay such additional amount (if any,
but in any event not a lesser amount) as may be necessary to ensure that the
amount actually received in the Judgment Currency, when converted at the Rate
of Exchange prevailing on the date of payment, will produce the amount of the
Obligation Currency which could have been purchased with the amount of the
Judgment Currency stipulated in the judgment or judicial order at the Rate of
Exchange prevailing on the Judgment Conversion Date. Any amount due from any
Credit Party under this Section 13.17(b) shall be due as a separate
debt and shall not be affected by judgment being obtained for any other amounts
due under or in respect of any of the Loan Documents.


 


(c)                                  The term “Rate of Exchange” in this Section 13.17
means the spot rate of exchange published by the Bank of Canada on the relevant
date at or about 12:00 noon (Toronto time).


 


(d)                                 Unless otherwise specified,
all references to dollar amounts in this Agreement shall mean Canadian Dollars.


 


13.18                 Joint and Several Obligations


 


Notwithstanding any other provision contained in this Agreement or any
other Loan Document, if a “secured creditor” (as that term is defined under the
Bankruptcy and Insolvency Act (Canada))
is determined by a court of competent jurisdiction not to include a Person to
whom obligations are owed on a joint or joint and several basis, then Borrower’s
Obligations (and the Obligations of the Corporation and its Subsidiaries), to
the extent such Obligations are secured, only shall be several obligations and
not joint or joint and several obligations.


 


13.19                 Liability of Limited Partners


 


It is hereby acknowledged by all parties hereto that all of the parties
to this Agreement that are limited partnerships, are limited partnerships
formed under the Partnership Act (Alberta),
a limited partner (if not a general partner) of which is only liable for any of
its liabilities or any of its losses to the extent of the amount that he or she
has contributed or agreed to contribute to its capital and his or her pro rata
share of any undistributed income.


 


*** THE REMAINDER OF THIS
PAGE HAS BEEN LEFT BLANK INTENTIONALLY ***


 


82

















 


IN WITNESS WHEREOF, this Agreement has been
duly executed as of the date first written above.


 


 


	
   

  	
  EVEREADY
  ENERGY SERVICES CORP., as Borrower

  
	
   

  	
   

  
	
   

  	
   

  	
  (signed)
  “Jason Vandenberg”

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
  Jason Vandenberg

  
	
   

  	
  Title:

  	
  Chief Financial Officer

  



 


This is a counterpart signature page to the Amended and Restated
Credit Agreement dated December 31, 2008.


 


83

















 


	
   

  	
  GE CANADA
  ASSET FINANCING HOLDING COMPANY, as Agent

  
	
   

  	
   

  
	
   

  	
   

  	
  (signed)
  “Ron Tratch”

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
  Ron Tratch

  
	
   

  	
  Title:

  	
  SVP Risk, Canada

  



 


This is a counterpart signature page to the Amended and Restated
Credit Agreement dated December 31, 2008.


 


84

















 


	
   

  	
  GE CANADA
  ASSET FINANCING HOLDING COMPANY, as Lender

  
	
   

  	
   

  
	
   

  	
   

  	
  (signed)
  “Ron Tratch”

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
  Ron Tratch

  
	
   

  	
  Title:

  	
  SVP Risk, Canada

  



 


This is a counterpart signature page to the Amended and Restated
Credit Agreement dated December 31, 2008.


 


85

















 


The names
of Lenders have been omitted from the SEDAR version of this Agreement in
accordance with Section 12.2(3) of National Instrument 51-102 in
order to comply with the confidentiality requirements of Section 13.13 of
this Agreement.


 


This is a counterpart signature page to the Amended and Restated
Credit Agreement dated December 31, 2008.


 


86

















 


The names
of Lenders have been omitted from the SEDAR version of this Agreement in
accordance with Section 12.2(3) of National Instrument 51-102 in
order to comply with the confidentiality requirements of Section 13.13 of
this Agreement.


 


This is a counterpart signature page to the Amended and Restated
Credit Agreement dated December 31, 2008.


 


87

















 


The names
of Lenders have been omitted from the SEDAR version of this Agreement in
accordance with Section 12.2(3) of National Instrument 51-102 in
order to comply with the confidentiality requirements of Section 13.13 of
this Agreement.


 


This is a counterpart signature page to the Amended and Restated
Credit Agreement dated December 31, 2008.


 


88

















 


The names
of Lenders have been omitted from the SEDAR version of this Agreement in
accordance with Section 12.2(3) of National Instrument 51-102 in
order to comply with the confidentiality requirements of Section 13.13 of
this Agreement.


 


This is a counterpart signature page to the Amended and Restated
Credit Agreement dated December 31, 2008.


 


89

















 


The names
of Lenders have been omitted from the SEDAR version of this Agreement in
accordance with Section 12.2(3) of National Instrument 51-102 in order
to comply with the confidentiality requirements of Section 13.13 of this
Agreement.


 


This is a counterpart signature page to the Amended and Restated
Credit Agreement dated December 31, 2008.


 


90

















 


The names
of Lenders have been omitted from the SEDAR version of this Agreement in
accordance with Section 12.2(3) of National Instrument 51-102 in
order to comply with the confidentiality requirements of Section 13.13 of
this Agreement.


 


This is a counterpart signature page to the Amended and Restated
Credit Agreement dated December 31, 2008.


 


91
















 


	
  EVEREADY
  INC.

  	
   

  	
  RIVER
  VALLEY ENERGY SERVICES LTD.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (signed)
  “Jason Vandenberg”

  	
   

  	
   

  	
  (signed)
  “Jason Vandenberg”

  
	
  By:

  	
   

  	
   

  	
  By:

  	
   

  
	
  Name:

  	
  Jason Vandenberg

  	
   

  	
  Name:

  	
  Jason Vandenberg

  
	
  Title:

  	
  Chief Financial Officer

  	
   

  	
  Title:

  	
  Chief Financial Officer

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  JL
  FILTRATION OPERATING  LIMITED
  PARTNERSHIP, by its General Partner, JL FILTRATION INC.

  	
   

  	
  EVEREADY
  HOLDINGS LIMITED  PARTNERSHIP, by
  its General Partner, EVEREADY HOLDINGS GP LTD.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (signed)
  “Jason Vandenberg”

  	
   

  	
   

  	
  (signed)
  “Jason Vandenberg”

  
	
  By:

  	
   

  	
   

  	
  By:

  	
   

  
	
  Name:

  	
  Jason Vandenberg

  	
   

  	
  Name:

  	
  Jason Vandenberg

  
	
  Title:

  	
  Chief Financial Officer

  	
   

  	
  Title:

  	
  Chief Financial Officer

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  RIVER
  VALLEY OPERATING  LIMITED
  PARTNERSHIP, by its General Partner, RIVER VALLEY ENERGY SERVICES LTD.

  	
   

  	
  EVEREADY
  OPERATING LIMITED PARTNERSHIP, by its General Partner EVEREADY ENERGY
  SERVICES CORP.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (signed)
  “Jason Vandenberg”

  	
   

  	
   

  	
  (signed)
  “Jason Vandenberg”

  
	
  By:

  	
   

  	
   

  	
  By:

  	
   

  
	
  Name:

  	
  Jason Vandenberg

  	
   

  	
  Name:

  	
  Jason Vandenberg

  
	
  Title:

  	
  Chief Financial Officer

  	
   

  	
  Title:

  	
  Chief Financial Officer

  



 


This is a counterpart signature page to the Amended and Restated
Credit Agreement dated December 31, 2008.


 


92

















 


	
  EVEREADY
  INDUSTRIAL WESTERN  LTD.

  	
   

  	
  MOBILE
  INDUSTRIAL HEALTH SERVICES LTD.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (signed)
  “Jason Vandenberg”

  	
   

  	
   

  	
  (signed)
  “Jason Vandenberg”

  
	
  By:

  	
   

  	
   

  	
  By:

  	
   

  
	
  Name:

  	
  Jason Vandenberg

  	
   

  	
  Name:

  	
  Jason Vandenberg

  
	
  Title:

  	
  Chief Financial Officer

  	
   

  	
  Title:

  	
  Chief Financial Officer

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  JL
  FILTRATION INC.

  	
   

  	
  TRI-VAX
  ENTERPRISES LTD.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (signed)
  “Jason Vandenberg”

  	
   

  	
   

  	
  (signed)
  “Jason Vandenberg”

  
	
  By:

  	
   

  	
   

  	
  By:

  	
   

  
	
  Name:

  	
  Jason Vandenberg

  	
   

  	
  Name:

  	
  Jason Vandenberg

  
	
  Title:

  	
  Chief Financial Officer

  	
   

  	
  Title:

  	
  Chief Financial Officer

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  EVEREADY
  ENERGY SERVICES, INC.

  	
   

  	
  WINTERHAWK
  ENTERPRISES (PROVOST) LTD.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (signed)
  “Jason Vandenberg”

  	
   

  	
   

  	
  (signed)
  “Jason Vandenberg”

  
	
  By:

  	
   

  	
   

  	
  By:

  	
   

  
	
  Name:

  	
  Jason Vandenberg

  	
   

  	
  Name:

  	
  Jason Vandenberg

  
	
  Title:

  	
  Chief Financial Officer

  	
   

  	
  Title:

  	
  Chief Financial Officer

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  CANADA-WIDE
  OILFIELD SERVICES  LTD.

  	
   

  	
  ACQUISITION
  LIMITED PARTNERSHIP, by its General Partner, 1202867 ALBERTA LTD.

  
	
   

  	
   

  	
   

  
	
   

  	
  (signed)
  “Jason Vandenberg”

  	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  	
  (signed)
  “Jason Vandenberg”

  
	
  Name:

  	
  Jason Vandenberg

  	
   

  	
  By:

  	
   

  
	
  Title:

  	
  Chief Financial Officer

  	
   

  	
  Name:

  	
  Jason Vandenberg

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1225979
  ALBERTA LTD.

  	
   

  	
  1233460
  ALBERTA LTD.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (signed)
  “Jason Vandenberg”

  	
   

  	
   

  	
  (signed)
  “Jason Vandenberg”

  
	
  By:

  	
   

  	
   

  	
  By:

  	
   

  
	
  Name:

  	
  Jason Vandenberg

  	
   

  	
  Name:

  	
  Jason Vandenberg

  
	
  Title:

  	
  Chief Financial Officer

  	
   

  	
  Title:

  	
  Chief Financial Officer

  



 


This is a counterpart signature page to the Amended and Restated
Credit Agreement dated December 31, 2008.


 


93

















 


	
  1240609
  ALBERTA LTD.

  	
   

  	
  1202867
  ALBERTA LTD.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (signed)
  “Jason Vandenberg”

  	
   

  	
   

  	
  (signed)
  “Jason Vandenberg”

  
	
  By:

  	
   

  	
   

  	
  By:

  	
   

  
	
  Name:

  	
  Jason Vandenberg

  	
   

  	
  Name:

  	
  Jason Vandenberg

  
	
  Title:

  	
  Chief Financial Officer

  	
   

  	
  Title:

  	
  Chief Financial Officer

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1257427
  ALBERTA LTD.

  	
   

  	
  1206894
  ALBERTA LTD.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (signed)
  “Jason Vandenberg”

  	
   

  	
   

  	
  (signed)
  “Jason Vandenberg”

  
	
  By:

  	
   

  	
   

  	
  By:

  	
   

  
	
  Name:

  	
  Jason Vandenberg

  	
   

  	
  Name:

  	
  Jason Vandenberg

  
	
  Title:

  	
  Chief Financial Officer

  	
   

  	
  Title:

  	
  Chief Financial Officer

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  CANADA-WIDE
  OPERATING  LIMITED
  PARTNERSHIP, by its General Partner, CANADA-WIDE OILFIELD SERVICES LTD.

  	
   

  	
  EVEREADY
  DIRECTIONAL BORING LIMITED PARTNERSHIP, by its General Partner, EVEREADY
  DIRECTIONAL BORING LTD.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (signed)
  “Jason Vandenberg”

  	
   

  	
   

  	
  (signed)
  “Jason Vandenberg”

  
	
  By:

  	
   

  	
   

  	
  By:

  	
   

  
	
  Name:

  	
  Jason Vandenberg

  	
   

  	
  Name:

  	
  Jason Vandenberg

  
	
  Title:

  	
  Chief Financial Officer

  	
   

  	
  Title:

  	
  Chief Financial Officer

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  CAT TECH
  OPERATING LIMITED  PARTNERSHIP, by
  its General Partner, CAT TECH CANADA LTD. 

  	
   

  	
  ASTEC
  SAFETY SERVICES LTD.

  
	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  (signed)
  “Jason Vandenberg”

  
	
   

  	
  (signed)
  “Jason Vandenberg”

  	
   

  	
  By:

  	
   

  
	
  By:

  	
   

  	
   

  	
  Name:

  	
  Jason Vandenberg

  
	
  Name:

  	
  Jason Vandenberg

  	
   

  	
  Title:

  	
  Chief Financial Officer

  
	
  Title:

  	
  Chief Financial Officer

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  CAT TECH,
  LLC

  	
   

  	
  DIVERSIFIED
  PRESSURE SERVICES LTD.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (signed)
  “Jason Vandenberg”

  	
   

  	
   

  	
  (signed)
  “Jason Vandenberg”

  
	
  By:

  	
   

  	
   

  	
  By:

  	
   

  
	
  Name:

  	
  Jason Vandenberg

  	
   

  	
  Name:

  	
  Jason Vandenberg

  
	
  Title:

  	
  Chief Financial Officer

  	
   

  	
  Title:

  	
  Chief Financial Officer

  



 


This is a counterpart signature page to the Amended and Restated
Credit Agreement dated December 31, 2008.


 


94

















 


	
  CAT TECH
  CANADA LTD.

  	
   

  	
  SAFETY
  WATCH, LLC

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (signed)
  “Jason Vandenberg”

  	
   

  	
   

  	
  (signed)
  “Jason Vandenberg”

  
	
  By:

  	
   

  	
   

  	
  By:

  	
   

  
	
  Name:

  	
  Jason Vandenberg

  	
   

  	
  Name:

  	
  Jason Vandenberg

  
	
  Title:

  	
  Chief Financial Officer

  	
   

  	
  Title:

  	
  Chief Financial Officer

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  BULLSEYE
  BORING LTD.

  	
   

  	
  GREAT
  LAKES CARBON TREATMENT, INC.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (signed)
  “Jason Vandenberg”

  	
   

  	
   

  	
  (signed)
  “Jason Vandenberg”

  
	
  By:

  	
   

  	
   

  	
  By:

  	
   

  
	
  Name:

  	
  Jason Vandenberg

  	
   

  	
  Name:

  	
  Jason Vandenberg

  
	
  Title:

  	
  Chief Financial Officer

  	
   

  	
  Title:

  	
  Chief Financial Officer

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  EVEREADY
  HOLDINGS GP LTD.

  	
   

  	
  AIRBORNE
  IMAGING INC.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (signed)
  “Jason Vandenberg”

  	
   

  	
   

  	
  (signed)
  “Jason Vandenberg”

  
	
  By:

  	
   

  	
   

  	
  By:

  	
   

  
	
  Name:

  	
  Jason Vandenberg

  	
   

  	
  Name:

  	
  Jason Vandenberg

  
	
  Title:

  	
  Chief Financial Officer

  	
   

  	
  Title:

  	
  Chief Financial Officer

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  EVEREADY
  HOLDINGS (USA) INC.

  	
   

  	
  BREATHING
  SYSTEMS INTERNATIONAL, LLC

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (signed)
  “Jason Vandenberg”

  	
   

  	
   

  	
  (signed)
  “Jason Vandenberg”

  
	
  By:

  	
   

  	
   

  	
  By:

  	
   

  
	
  Name:

  	
  Jason Vandenberg

  	
   

  	
  Name:

  	
  Jason Vandenberg

  
	
  Title:

  	
  Chief Financial Officer

  	
   

  	
  Title:

  	
  Chief Financial Officer

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  RIVER
  VALLEY ENERGY SERVICES INC.

  	
   

  	
  RODRIGUE’S
  DIRECTIONAL DRILLING PROJECTS INC.

  
	
   

  	
   

  	
   

  
	
   

  	
  (signed)
  “Jason Vandenberg”

  	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  	
  (signed)
  “Jason Vandenberg”

  
	
  Name:

  	
  Jason Vandenberg

  	
   

  	
  By:

  	
   

  
	
  Title:

  	
  Chief Financial Officer

  	
   

  	
  Name:

  	
  Jason Vandenberg

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  



 


This is a counterpart signature page to the Amended and Restated
Credit Agreement dated December 31, 2008.


 


95

















 


	
  WINTERHAWK
  OPERATING  LIMITED
  PARTNERSHIP, by its General Partner, WINTERHAWK ENTERPRISES (PROVOST) LTD.

  	
   

  	
  EVEREADY
  DIRECTIONAL BORING LTD.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (signed)
  “Jason Vandenberg”

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
  (signed)
  “Jason Vandenberg”

  	
   

  	
  Name:

  	
  Jason Vandenberg

  
	
  By:

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  
	
  Name:

  	
  Jason Vandenberg

  	
   

  	
   

  	
   

  
	
  Title:

  	
  Chief Financial Officer

  	
   

  	
   

  	
   

  



 


	
  EVEREADY
  INCOME TRUST by its  Trustees

  	
   

  	
  EVEREADY
  INCOME FUND, by its Administrator, EVEREADY HOLDINGS GP LTD.

  
	
   

  	
   

  	
   

  
	
   

  	
  (signed)
  “Jason Vandenberg”

  	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  	
  (signed)
  “Jason Vandenberg”

  
	
  Name:

  	
  Jason Vandenberg

  	
   

  	
  By:

  	
   

  
	
  Title:

  	
  Chief Financial Officer

  	
   

  	
  Name:

  	
  Jason Vandenberg

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  DENMAN
  INDUSTRIAL OPERATING  LP

  	
   

  	
  DENMAN
  INDUSTRIAL TRAILERS LTD.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (signed)
  “Jason Vandenberg”

  	
   

  	
   

  	
  (signed)
  “Jason Vandenberg”

  
	
  By:

  	
   

  	
   

  	
  By:

  	
   

  
	
  Name:

  	
  Jason Vandenberg

  	
   

  	
  Name:

  	
  Jason Vandenberg

  
	
  Title:

  	
  Chief Financial Officer

  	
   

  	
  Title:

  	
  Chief Financial Officer

  



 


This is a counterpart signature page to the Amended and Restated
Credit Agreement dated December 31, 2008.


 


96
















 


Annex A


(Recitals)


 


to


 


CREDIT AGREEMENT


 


DEFINITIONS


 


Capitalized terms used in
the Loan Documents shall have (unless otherwise provided elsewhere in the Loan
Documents) the following respective meanings and all references to Sections,
Exhibits, Schedules or Annexes in the following definitions shall refer to
Sections, Exhibits, Schedules or Annexes of or to the Agreement:


 


“Account Debtor” means any Person who may become obligated to
any Credit Party under, with respect to, or on account of, an Account.


 


“Accounting Changes” has the meaning ascribed thereto in
Section 8.8.


 


“Accounts” means each and every “account,” as such term is
defined in the PPSA, now owned or hereafter acquired by any Credit Party,
including (a) all accounts receivable, other receivables, book debts,
claims and other forms of obligations (other than obligations evidenced by
chattel paper, securities or Instruments) now owned or hereafter received or
acquired by or belonging or owing to Borrower, whether arising out of goods
sold or services rendered by it or from any other transaction (including any
such obligations which may be characterized as an account or contract right
under the PPSA), (b) all of each Credit Party’s rights in, to and under
all purchase orders or receipts now owned or hereafter acquired by it for goods
or services, (c) all of each Credit Party’s rights to any goods
represented by any of the foregoing (including unpaid sellers’ rights of
rescission, replevin, reclamation and stoppage in transit and rights to
returned, reclaimed or repossessed goods), (d) all rights to payment due
or to become due to any Credit Party for property sold, leased, licensed,
assigned or otherwise disposed of, for a policy of insurance issued or to be
issued, for a secondary obligation incurred or to be incurred, for energy
provided or to be provided, for the use or hire of a vessel under a charter or
other contract, arising out of the use of a credit card or charge card, or for
services rendered or to be rendered by such Credit Party or in connection with
any other transaction (whether or not yet earned by performance on the part of
such Credit Party), and (e) all collateral security and guarantees of any
kind, now or hereafter in existence, given by any Account Debtor or other
Person with respect to any of the foregoing.


 


“Acknowledgements” means the acknowledgements of the Collateral
Documents presently held by the Agent in favour of the Lenders entered into
between the Lender and the Credit Party that is a signatory thereto.


 


“Acquisition Pro Forma” has the meaning ascribed to it in
Section 7.1(a)(ix)(A).


 


“Acquisition Projections” has the meaning ascribed to it in
Section 7.1(a)(ix)(B).


 


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“Advance” means any Revolving Credit Advance  or Term Loan B Advance.


 


“Affected Lender” has the meaning ascribed to it in
Section 1.15(c).


 


“Affiliate” means, with respect to any Person, (a) each
Person that, directly or indirectly, owns or controls, whether beneficially, or
as a trustee, guardian or other fiduciary, 10% or more of the Stock having
ordinary voting power in the election of directors of such Person,
(b) each Person that controls, is controlled by or is under common control
with such Person, (c) each of such Person’s officers, directors, joint
venturers, partners and trustees and (d) in the case of Borrower, the
immediate family members, spouses and lineal descendants of individuals who are
Affiliates of Borrower. For the purposes of this definition, “control” of a
Person shall mean the possession, directly or indirectly, of the power to
direct or cause the direction of its management or policies, whether through
the ownership of voting securities, by contract or otherwise; provided,
however, that the term “Affiliate” shall specifically exclude Lender.


 


“Agent” has the meaning ascribed thereto in the preamble to the
Agreement.


 


“Agreement” means this Credit Agreement among Borrower, the
other Credit Parties party thereto, and GE Canada, as Agent and Lender, and the
other Lenders from time to time party thereto, as the same may be amended,
supplemented, restated or otherwise modified from time to time.


 


“Appendices” has the meaning ascribed thereto in the recitals
to the Agreement.


 


“Applicable Percentage” has the meaning ascribed to it in
Section 1.8(c).


 


“Approved Fund” means, with respect to any Lender, any Person
(other than a natural person) that (a) 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 and (b) is
advised or managed by (i) such Lender, (ii) any Affiliate of such
Lender, or (iii) any Person (other than an individual) or any Affiliate of
any Person (other than an individual) that administers or manages such Lender.


 


“Articles” means, as applicable, the Articles of Incorporation,
Articles of Amalgamation or Articles of Continuance of a Credit Party, as the
same may be amended, restated, supplemented or replaced from time to time as
permitted hereunder.


 


“Assessed Equipment” means the equipment listed in Annex E
hereto.


 


“Asset Sale Offer” has the meaning ascribed to it in
Section 1.5(c)(iii).


 


“Assignment Agreement” has the meaning ascribed to it in
Section 11.1(b).


 


“BA Advance” means an Advance comprised of one or more Bankers’
Acceptances or, as applicable, BA Equivalent Loans.


 


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“BA Equivalent Loan” means, in relation to an Advance of,
Conversion into or continuation of a Bankers’ Acceptance, an Advance in Cdn.$
made by a Non-BA Lender as part of such Loan.


 


“BA Period” means with respect to any Loan a period of 1, 2 or
3 months.


 


“BA Margin” means the applicable rate of interest set forth
under the heading “BA Margin” in the table in Section 1.7(a).


 


“BA Rate” means, on any day, the annual rate of interest equal
to and identified as the average discount rate (rounded upwards, if necessary,
to the nearest 0.01%) of 1, 2 or 3 month Canadian dollar bankers’ acceptances
as displayed on the “Reuters Screen CDOR Page” as at approximately 10:00 a.m.
(Toronto time) on the next to last Wednesday (or, if such Wednesday is not a
Business Day, the preceding Business Day) of the preceding calendar month;
provided, however, that if such rate does not appear on the Reuters Screen CDOR
Page as contemplated, then the “BA Rate” shall be, on any day, the annual
rate of interest equal to the Bank of Canada composite mid-morning bid discount
rate of one-month Canadian dollar bankers’ acceptances as in effect on the next
to last Wednesday (or, if such Wednesday is not a Business Day, the preceding
Business Day) of the preceding calendar month and displayed in the Bank of
Canada Weekly Financial Statistics.


 


“Bank Rate” means, at any date, the annual rate of interest at
which the Bank of Canada is prepared to make advances, as effective on such
date, and as made public in accordance with Section 21 of the Bank of Canada Act (Canada).


 


“BA Stamping Fee” has the meaning ascribed thereto in
Section 1.7(a)(ii).


 


“Bankers’ Acceptance”  and  “BA”  mean an instrument denominated in Canadian
Dollars, drawn by the Borrower and accepted by a Lender in accordance with this
Agreement, and includes a “depository note” within the meaning of the Depository Bills and Notes Act (Canada)
and a bill of exchange within the meaning of the Bills of Exchange Act (Canada).


 


“Book Value” means, with respect to any asset, the cost of such
asset net of accumulated amortization with respect thereto, in each case as at
such time of determination and calculated in accordance with GAAP.


 


“Borrower” has the meaning ascribed thereto in the preamble to
the Agreement.


 


“Borrowing Availability” means, as of any date of
determination, the lesser of (i) the Revolving Loan Commitment less the
amount of the Revolving Loan then outstanding and (ii) the Borrowing Base
less the sum of the Revolving Loan then outstanding, the Term Loan then
outstanding and Term Loan B then outstanding.


 


“Borrowing Base” means, as of any date of determination by
Agent, from time to time, an amount equal to:


 


(b)                                 up to seventy-five percent
(75%) of the Corporation and its Subsidiaries’ eligible accounts receivable,
plus up to sixty percent (60%) of the Corporation and its


 


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Subsidiaries’
eligible U.S. domiciled accounts receivable, plus up to ninety percent (90%) of
the Corporation and its Subsidiaries’ eligible EDC insured amount of any
accounts receivable;


 


(c)                                  the amount of the
Corporation and its Subsidiaries’ eligible Inventory, up to the lesser of:
(i) fifty percent (50%) of its cost (FIFO) or (ii) fifty percent
(50%) of its market value, and, Inventory shall not account for more than 20%
of the total Borrowing Base margin; and


 


(d)                                 on quarterly determinations,
up to seventy-five percent (75%) of the orderly liquidation value of the
eligible appraised Equipment, plus on monthly determinations that are not at a
quarter end, sixty-five percent (65%) of Book Value, of any Equipment purchased
less seventy-five percent (75%) of the previously appraised orderly liquidation
value of any Equipment sold in each case since the last quarterly
determination.


 


“Borrowing Base Certificate” means a certificate to be executed
and delivered from time to time by Borrower in the form attached to the
Agreement as Exhibit 5.1(b).


 


“Borrowing Base Excess Offer” has the meaning ascribed to it in
Section 1.5(c)(ii) of the Agreement.


 


“Business Day” means any day that is not a Saturday, a Sunday
or a day on which banks are required or permitted to be closed in the City of
Toronto.


 


“Canadian Benefit Plans” means any plan, fund, program, or
policy, whether oral or written, formal or informal, funded or unfunded,
insured or uninsured, providing material employee benefits, including medical,
hospital care, dental, sickness, accident, disability, life insurance, pension,
retirement or savings benefits, under which the Borrower has any liability with
respect to any employee or former employee, but excluding any Canadian Pension
Plans.


 


“Canadian Dollars” “Dollars”,
“Cdn$” or $ shall mean the lawful
currency of Canada.


 


“Canadian Pension Plans” means each pension plan required to be
registered under Canadian federal or provincial law that is maintained or
contributed to by a Credit Party for its employees or former employees, but
does not include the Canada Pension Plan or the Quebec Pension Plan as
maintained by the Government of Canada or the Province of Québec, respectively.


 


“Canadian Prime Rate” means, for any day, the rate of interest
per annum established from time to time by a Schedule I Lender selected by the
Agent as the reference rate of interest for the determination of interest rates
that such Schedule I Lender posts as its “Prime Rate of Interest” in Canada for
Canadian Dollar demand loans in Canada to its most creditworthy customers;
provided that if at such time there are no Schedule I Lenders available to be
selected by the Agent then the Agent shall select any other Canadian chartered
bank listed on Schedule I to the Bank Act
(Canada) for the purposes of this provision.


 


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“Canadian Prime Rate Loans” means any Revolving Credit Advance
bearing interest at a rate based on the Canadian Prime Rate.


 


“Capital Expenditures” means, with respect to any Person, all
expenditures (by the expenditure of cash or the incurrence of Indebtedness) by
such Person during any measuring period for any fixed assets or improvements or
for replacements, substitutions or additions thereto, that have a useful life
of more than one year and that are required to be capitalized under GAAP.


 


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


 


“Capital Lease Obligation” means, with respect to any Capital
Lease of any Person, the amount of the obligation of the lessee thereunder
that, in accordance with GAAP, would appear on a balance sheet of such lessee
in respect of such Capital Lease.


 


“Cash Equivalents” means cash or investments in
(A) marketable direct obligations issued or unconditionally guaranteed by
Canada, any agency thereof, the United States of America or any agency thereof
maturing within one year from the date of acquisition thereof,
(B) commercial paper maturing no more than one year from the date of
creation thereof and currently having the highest rating obtainable from either
Standard & Poor’s Ratings Group or Moody’s Investors Service, Inc.,
(C) certificates of deposit, maturing no more than one year from the date
of creation thereof, issued by commercial banks incorporated under the laws of
Canada or the United States of America or a State thereof, each having combined
capital, surplus and undivided profits of not less than US$300,000,000 and
having a senior unsecured rating of “A” or better by a nationally recognized
rating agency (an “A Rated Bank”),
(D) time deposits, maturing no more than 30 days from the date of creation
thereof with A Rated Banks and (E) mutual funds that invest solely in one
or more of the investments described in clauses (A) through
(D) above.


 


“CDOR Rate” means the arithmetic average of the yields to
maturity for bankers’ acceptances quoted on the Reuter’s Canadian Deposit
Offered Rate screen, at 10:00 a.m. (Toronto, Ontario time) on the applicable
date on which an Advance shall take place, for bankers’ acceptances having a
term the same as the term requested for each Bankers’ Acceptance issued
pursuant to the applicable Advance.


 


“CDS” has the meaning ascribed to it in Section 3.2(d).


 


“Change of Control” means if, after the Closing Date, any
Person, (a) other than another Credit Party, acquires, directly or
indirectly, alone or in concert with other Persons, over a period of time or at
any one time, capital stock of a Credit Party aggregating in excess of 30% of
all of the then issued and outstanding capital stock of a Credit Party, or
(b) acquires, directly or indirectly, alone or in concert with other
Persons, over a period of time or at any one time, trust units of a trust
aggregating in excess of 30% of all of the then issued and outstanding capital
stock of a Credit Party.


 


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“Charges” means all Taxes assessed, levied or imposed against a
Credit Party or upon or relating to (a) the Collateral, (b) the
Obligations, (c) the employees, payroll, income or gross receipts or
capital of a Credit Party, (d) any Credit Party’s ownership or use of any
properties or other assets, or (e) any other aspect of any Credit Party’s
business.


 


“Chattel Paper” means any “chattel paper,” as such term is
defined in the PPSA, now owned or hereafter acquired by any Credit Party,
wherever located.


 


“Closing Date” means December 31, 2008.


 


“Collateral” means the property covered by the Security
Agreement, and the other Collateral Documents and any other personal property
now existing or hereafter acquired, that may at any time be or become subject
to a security interest or other Lien in favour of Agent, on behalf of the
Lenders, to secure the Obligations.


 


“Collateral Documents” means the Security Agreement and related
acknowledgements of security, the Acknowledgements, the Pledge Agreements, the
Guarantees, and all similar agreements entered into guaranteeing payment of, or
granting a Lien upon property as security for payment of, the Obligations.


 


“Collateral Reports” means the reports with respect to the
Collateral referred to in Section 5.1(b).


 


“Collection Accounts” shall mean Agent’s Canadian Dollar
account number 09-716-29 in the name of Agent at National Bank of Canada, Main
600, de la Gauchetière West, Montréal, Québec, H3B 2B2, or such other
account(s) as may be specified in writing by Agent as the “Collection
Accounts.”


 


“Commitment Termination Date” means the date of termination of
the Lenders obligation to make Revolving Credit Advances as determined from
time to time in accordance with Section 1.2(c).


 


“Commitments” means as to any Lender, the aggregate of such
Lender’s Individual Revolving Loan Commitment and Individual Term Loan B
Commitment Amount, as such Commitments are set forth in Annex D to the
Agreement and as such Commitments may be reduced, amortized or adjusted from
time to time in accordance with the Agreement.


 


“Compliance Certificate” has the meaning ascribed to it in
Section 5.1(a).


 


“Confidentiality Termination Date” has the meaning ascribed to
it in Section 13.8.


 


“Consolidated Net Income” means, with respect to any Person for
any period, the consolidated net income (or loss) of such Person and its
Subsidiaries for such period; provided, however, that the
following shall be excluded: (a) the net income of any other Person in
which such Person or one of its Subsidiaries has a joint interest with a
third-party (which interest does not cause the net income of such other Person
to be consolidated into the net income of such Person), except to the extent of
the amount of dividends or distributions paid to such Person or Subsidiary,
(b) the net


 


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income of any Subsidiary of
such Person that is, on the last day of such period, subject to any restriction
or limitation on the payment of dividends or the making of other distributions,
to the extent of such restriction or limitation and (c) the net income of
any other Person arising prior to such other Person becoming a Subsidiary of
such Person or merging or consolidating into such Person or one of its
Subsidiaries.


 


“Consolidated Party” means the Credit Parties and the Excluded
Subsidiaries.


 


“Contract Period” means, with respect to a Bankers’ Acceptance,
the number of days in the term of such Bankers’ Acceptance.


 


“Contracts” means all contracts, undertakings, or agreements
(other than rights evidenced by chattel paper, securities or Instruments) in or
under which Borrower may now or hereafter have any right, title or interest,
including any agreement relating to the terms of payment or the terms of
performance of any Account.


 


“Conversion” means in relation to an Advance, a conversion of
an Advance into another type of Advance made pursuant to the Agreement.


 


“Copyright License” means any and all rights now owned or
hereafter acquired by any Credit Party under any written agreement granting any
right to use any Copyright or Copyright registration.


 


“Copyrights” means all of the following now owned or hereafter
adopted or acquired by any Credit Party: (a) all copyrights and
intangibles of like nature (whether registered or unregistered) now owned or
existing or hereafter adopted or acquired, all registrations and recordings
thereof, and all applications in connection therewith, including all
registrations, recordings and applications in the Canadian Copyright Office or
in any similar office or agency in any other country or any political
subdivision thereof, and (b) all reissues, extensions or renewals thereof.


 


“Corporation” means Eveready Inc.


 


“Co-Syndication Agents” means Bank of Montreal and Canadian
Imperial Bank of Commerce.


 


“CRA” means the Canada Revenue Agency.


 


“Credit Parties” means the Corporation, Borrower, and each of
their respective Subsidiaries, except for the Excluded Subsidiaries.


 


“Current Assets” means, with respect to any Person, all current
assets of such Person as of any date of determination calculated in accordance
with GAAP, but excluding cash, Cash Equivalents and debts due from Affiliates.


 


“Current Liabilities” means, with respect to any Person, all
liabilities that should, in accordance with GAAP, be classified as current
liabilities, and in any event shall include all Indebtedness payable on demand
or within one year from any date of determination without any option on the
part of the obligor to extend or renew beyond such year, all accruals for
federal, provincial or


 


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other taxes based on or
measured by income and payable within such year, but excluding the current
portion of long-term debt required to be paid within one year and the
outstanding principal balance of the Revolving Loan.


 


“DBNA” has the meaning ascribed to it in Section 3.2(d).


 


“Default” means any event that, with the passage of time or
notice or both, would, unless cured or waived, become an Event of Default.


 


“Default Rate” has the meaning ascribed to it in
Section 1.7(d).


 


“Designs” means all of the following now owned or hereafter
acquired by any Credit Party: (a) all industrial designs and intangibles
of like nature (whether registered or unregistered), now owned or existing or
hereafter adopted or acquired, all registrations and recordings thereof, and
all applications in connection therewith, including all registrations,
recordings and applications in the Canadian Industrial Design Office or in any
similar office or agency in any other country or any political subdivision
thereof, and (b) all reissues, extensions or renewals thereof.


 


“Design Licence” means rights under any written agreement now
owned or hereafter acquired by any Credit Party granting any right to use any
Design.


 


“Disclosure Schedules” means the Schedules prepared by Borrower
and denominated as Disclosure Schedules 4.1 through 7.8 in the Index to the
Agreement.


 


“Discount Proceeds” means, for any BA (or, as applicable, any
BA Equivalent Loan), an amount (rounded to the nearest whole cent, and with one
half of one cent being rounded up) calculated on the applicable date of
Borrowing by multiplying:


 


(a)                                  the face amount of the BA
(or, as applicable, the undiscounted amount of the BA Equivalent Loan); by


 


(b)                                 the quotient of one divided
by the sum of one plus the product of:


 


	
  (i)

  	
  the Discount Rate
  (expressed as a decimal) applicable to such BA (or as applicable, such BA
  Equivalent Loan), multiplied by

  
	
   

  	
   

  
	
  (ii)

  	
  a fraction, the numerator
  of which is the Contract Period of the BA (or, as applicable, the BA
  Equivalent Loan) and the denominator of which is 365,

  



 


with such quotient being rounded up or down to the
nearest fifth decimal place, and with .000005 being rounded up.


 


“Discount Rate” means, with respect to either a BA for a
particular BA Period being purchased by a Lender on any day or a BA Equivalent
Loan being made by a Lender on any day, (i) for any Lender which is a
Schedule I chartered bank under the Bank Act
(Canada), the CDOR Rate on such day for such Contract Period; and (ii) for
any other Lender, the lesser of (a) the CDOR Rate


 


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on such day for such
Contract Period, plus 0.10%, and (b) the percentage discount rate quoted
by such Lender as the percentage discount rate at which such Lender would, in
accordance with its normal practices, at or about 10:00 a.m. on such date, be
prepared to purchase bankers’ acceptances or make BA Equivalent Loans having a
face amount and term comparable to the face amount and term of such BA or, in
the case of a Lender making a BA Equivalent Loan.


 


“Documentation Agent” means the Bank of Nova Scotia.


 


“Draft” has the meaning ascribed to it in Section 3.2(b).


 


“DRIP” means, collectively, any dividend reinvestment plan
adopted by any of the Consolidated Parties, as same may be amended from time to
time.


 


“EBITDA” means, with respect to any Person for any fiscal
period, without duplication, an amount equal to (a) consolidated net
income of such Person for such period, determined in accordance with GAAP,
minus (b) the sum of (i) income tax credits, (ii) interest
income, (iii) gain from extraordinary items for such period, (iv) any
aggregate net gain (but not any aggregate net loss) during such period arising
from the sale, exchange or other disposition of capital assets by such Person
(including any fixed assets, whether tangible or intangible, all inventory sold
in conjunction with the disposition of fixed assets and all securities), and
(v) any other non-cash gains that have been added in determining
consolidated net income, in each case to the extent included in the calculation
of consolidated net income of such Person for such period in accordance with
GAAP, but without duplication, plus (c) the sum of (i) any provision
for income taxes, (ii) Interest Expense, (iii) loss from extraordinary
items for such period, (iv) depreciation and amortization for such period,
(v) amortized debt discount for such period, and (vi) the amount of
any deduction to consolidated net income as the result of any grant to any
members of the management of such Person of any Stock, in each case to the
extent included in the calculation of consolidated net income of such Person
for such period in accordance with GAAP, but without duplication, and
(vii) any other non-cash losses that have been deducted in determining
consolidated net income, in each case to the extent included in the calculation
of consolidated net income of such Person for such period in accordance with
GAAP, but without duplication. For purposes of this definition, the following
items shall be excluded in determining consolidated net income of a Person:
(1) the income (or deficit) of any other Person accrued prior to the date
it became a Subsidiary of, or was amalgamated or consolidated into, such Person
or any of such Person’s Subsidiaries; (2) the income (or deficit) of any
other Person (other than a Subsidiary) in which such Person has an ownership
interest, except to the extent any such income has actually been received by
such Person in the form of cash dividends or distributions; (3) the undistributed
earnings of any Subsidiary of such Person to the extent that the declaration or
payment of dividends or similar distributions by such Subsidiary is not at the
time permitted by the terms of any contractual obligation or requirement of law
applicable to such Subsidiary; (4) any restoration to income of any
contingency reserve, except to the extent that provision for such reserve was
made out of income accrued during such period; (5) any write-up of any
asset; (6) any net gain from the collection of the proceeds of life
insurance policies; (7) any net gain arising from the acquisition of any
securities, or the extinguishment, under GAAP, of any Indebtedness, of such
Person; (8) in the case of a successor to such Person by consolidation or amalgamation
or as a transferee of its assets, any earnings of such successor prior to such


 


9

















 


consolidation, amalgamation
or transfer of assets; and (9) any deferred credit representing the excess
of equity in any Subsidiary of such Person at the date of acquisition of such
Subsidiary over the cost to such Person of the investment in such Subsidiary.


 


“Employee Unit Plan Guarantees” means unsecured guarantees in
an aggregate amount not to exceed $8,300,000 granted by any Credit Parties  in favour of the Bank of Montreal in
respect of loan obligations incurred by employees of any of the Credit Parties
(or any Affiliate thereof) in connection with certain employee unit purchase
plans.


 


“Environmental Indemnity Agreement” means the environmental
indemnity agreement dated as of the date hereof among the Borrower, the other
Credit Parties party thereto and the Agent, as the same may be amended,
supplemented, restated or otherwise modified from time to time.


 


“Environmental Laws” means all applicable federal, provincial,
territorial, municipal, local and foreign laws (including the common law),
statutes, ordinances, codes, rules, guidelines, policies, procedures,
standards, orders-in-council, and regulations, now or hereafter in effect, and
in each case as amended or supplemented from time to time, and any applicable
judicial or administrative interpretation thereof, including any applicable
judicial or administrative order, consent decree, order or judgment, imposing
liability or standards of conduct for or relating to the regulation and
protection of human, plant or animal health or safety, the environment or
natural resources (including air, surface water, groundwater, wetlands, land,
soil, land surface or subsurface strata, wildlife, aquatic species and
vegetation). Environmental Laws include, but are not limited to, the Environmental Protection and Enhancement Act
(Alberta), Canadian Environmental Protection
Act, 1999, Fisheries Act,
Transportation of Dangerous Goods Act,
1992, the Migratory Birds Protection Act,
1994, the Species At Risk Act,
the Hazardous Products Act, the Canada Shipping Act and the Canada Wildlife Act.


 


“Environmental Liabilities” means, with respect to any Person,
all liabilities, obligations, responsibilities, costs (including any response,
remedial and removal costs, investigation and feasibility study costs, capital
costs, operation and maintenance costs), losses, damages (including any
punitive damages, property damages, natural resource damages, consequential
damages, treble damages) and expenses (including all reasonable fees,
disbursements and expenses of legal counsel, experts and consultants), fines,
penalties, sanctions and interest incurred as a result of or related to any
claim, suit, action, administrative order, investigation order (including
judicial and administrative orders), proceeding or demand by any Person,
whether based in contract, tort, implied or express warranty, strict liability,
statute regulation, equity or common law, including any arising under or
related to any Environmental Laws, Environmental Permits, or in connection with
any Release or threatened Release or presence of a Hazardous Material, whether
on, at, in, under, from or about or in the vicinity of any real or personal property.


 


“Environmental Permits” means all permits, licenses,
authorizations, certificates, approvals or registrations required by any
Governmental Authority under any Environmental Laws.


 


“Equipment,” as such term is defined in the PPSA, now owned or
hereafter acquired by any Credit Party, wherever located and, in any event,
including all such Credit Party’s machinery and 


 


10
















 


equipment, including
processing equipment, conveyors, machine tools, data processing and computer
equipment, including embedded software and peripheral equipment and all
engineering, processing and manufacturing equipment, office machinery,
furniture, materials handling equipment, tools, attachments, accessories,
automotive equipment, trailers, trucks, forklifts, molds, dies, stamps, motor
vehicles, rolling stock and other equipment of every kind and nature, trade
fixtures and fixtures not forming a part of real property, all whether now
owned or hereafter acquired, and wherever situated, together with all additions
and accessions thereto, replacements therefor, all parts therefor, all
substitutes for any of the foregoing, fuel therefor, and all manuals, drawings,
instructions, warranties and rights with respect thereto, and all products and
proceeds thereof and condemnation awards and insurance proceeds with respect
thereto.


 


“Equivalent Amount” means, on any date of determination, with
respect to obligations or valuations denominated in one currency (the “first currency”), the amount of another
currency (the “second currency”)
which would result from the Agent converting the first currency into the second
currency at approximately 12:00 noon (Toronto time) on such day in accordance
with Agent’s customary practice for commercial loans being administered by it
or at such other rate as may have been agreed in writing between Borrower and
Agent.


 


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


 


“ERISA Affiliate” means, with respect to any Credit Party, any
trade or business (whether or not incorporated) that, together with such Credit
Party, are treated as a single employer within the meaning of Sections 414(b),
(c), (m) or (o) of the IRC.


 


“ERISA Event” means, with respect to any Credit Party or any
ERISA Affiliate, (a) any event described in Section 4043(c) of
ERISA with respect to a Title IV Plan; (b) the withdrawal of any Credit
Party or ERISA Affiliate from a Title IV Plan subject to Section 4063 of
ERISA during a plan year in which it was a substantial employer, as defined in Section 4001(a)(2) of
ERISA; (c) the complete or partial withdrawal of any Credit Party or any
ERISA Affiliate from any Multiemployer Plan; (d) the filing of a notice of
intent to terminate a Title IV Plan or the treatment of a plan amendment as a
termination under Section 4041 of ERISA; (e) the institution of
proceedings to terminate a Title IV Plan or Multiemployer Plan by the PBGC; (f) the
failure by any Credit Party or ERISA Affiliate to make when due required
contributions to a Multiemployer Plan or Title IV Plan unless such failure is
cured within thirty (30) days; (g) any other event or condition that would
reasonably be expected to constitute grounds under Section 4042 of ERISA
for the termination of, or the appointment of a trustee to administer, any
Title IV Plan or Multiemployer Plan or for the imposition of liability under Section 4069
or 4212(c) of ERISA; (h) the termination of a Multiemployer Plan
under Section 4041A of ERISA or the reorganization or insolvency of a
Multiemployer Plan under Section 4241 or 4245 of ERISA; or (i) the
loss of a Qualified Plan’s qualification or tax exempt status; or (j) the
termination of a Plan described in Section 4064 of ERISA.


 


“ERISA Plan” mean, at any time, an “employee benefit plan,” as
defined in Section 3(3) of ERISA, that any Credit Party or ERISA
Affiliate maintains, contributes to or has an obligation to contribute to on
behalf of participants who are or were employed by any Credit Party.


 


11

















 


“Escrow Funds” has the meaning ascribed to it in Section 3.5.


 


“Event of Default” has the meaning ascribed to it in Section 10.1.


 


“Excess
Cash Flow” means, with respect to any Person for any period, (a) the
Consolidated Net Income of such Person for such period plus (b) the
sum of, in each case to the extent included in the calculation of such
Consolidated Net Income but without duplication, (i) any depreciation,
depletion and amortization expense, (ii) future tax, (iii) accrued
but unrealized foreign exchange loss, (iv) unit based compensation
expense, and (v) non-cash accretion expense to the extent related to
Subordinated Debt, and (vi) any other non-cash expenses that have been
deducted in determining Consolidated Net Income, in each case to the extent
included in the calculation of Consolidated Net Income of such Person for such
period in accordance with GAAP, but without duplication, minus (c) accrued
but unrealized foreign exchange gain.


 


“Excluded Subsidiaries” means (i) all Subsidiaries of the
Corporation or the Borrower not in Canada or the U.S., provided however that
such Subsidiaries do not collectively account at any time for more than 2% of
EBITDA or Net Worth (calculated, in each case, with respect to the Corporation
and all of its Subsidiaries on a consolidated basis inclusive of the
Subsidiaries to which this definition applies), in which case, with effect on
and from the date that such percentage threshold is exceeded, the Borrower
shall, at its sole discretion, determine which of the above-mentioned
Subsidiaries shall permanently cease to be Excluded Subsidiaries in order to
ensure such percentage threshold is no longer exceeded and such new Credit
Parties shall deliver all security documents, certificates, addition
agreements, opinions and other documents, and shall perform all actions as
required by Agent, acting reasonably, in connection therewith; (ii) Pembina
Area Landfill LP; and (iii) Pembina Area Landfill Ltd.


 


“Existing Credit Agreement” has the meaning ascribed to it in
the recitals.


 


“Fees” means any and all fees payable to Agent or any Lender
pursuant to the Agreement or any of the other Loan Documents.


 


“Financial Covenants” means the financial covenants set forth
in Article VIII.


 


“Financial Statements” means the consolidated and consolidating
income statements, statements of cash flows and balance sheets of the
Corporation or the Fund, as applicable, delivered in accordance with Sections
4.4 and 5.1(a).


 


“Fiscal Month” means any of the monthly accounting periods of
the Corporation or the Fund, as applicable.


 


“Fiscal Quarter” means each quarterly accounting period of the
Corporation or the Fund, as applicable.


 


“Fiscal Year” means each annual accounting period of the
Corporation or the Fund, as applicable.


 


12

















 


“Fixed Charges” means, with respect to any Person for any
fiscal period, (a) the aggregate of all Interest Expense (excluding
accrued interest and accretion expense on convertible debenture and all other
non-cash expenses) paid or accrued during such period, plus (b) scheduled
payments of principal with respect to Indebtedness during such period, plus (c) all
cash distributions to Shareholders during such period, plus (d) any of the
permitted distributions as set out in (d) of the definition of “Permitted Distribution”.


 


“Fixed Charge Coverage Ratio” means, with respect to any Person
on a rolling four quarter basis, the ratio of (i) EBITDA, less Unfinanced
Capital Expenditures and less Taxes paid or payable in cash to (ii) Fixed
Charges.


 


“Fixtures” means all fixtures (including trade fixtures),
facilities and equipment, howsoever affixed or attached to real property or
buildings or other structures on real property, now owned or hereafter acquired
by any Credit Party.


 


“Fund” means Eveready Income Fund.


 


“Funded Debt” means, with respect to any Person, without
duplication, all Indebtedness for borrowed money evidenced by notes, bonds,
debentures, or similar evidences of Indebtedness and that by its terms matures
more than one year from, or is directly or indirectly renewable or extendible
at such Person’s option under a revolving credit or similar agreement
obligating the lender or lenders to extend credit over a period of more than
one year from the date of creation thereof, and specifically including Capital
Lease Obligations, current maturities of long term debt, revolving credit and
short term debt extendible beyond one year at the option of the debtor, and
also including, in the case of Borrower, the Obligations and, without
duplication, Guaranteed Indebtedness consisting of guaranties of Funded Debt of
other Persons and all payments that would be required to be made under any
Secured Rate Contracts and Secured Rate Contract Support Documents in the event
of a termination (or early termination) or the time of determination.


 


“GAAP” means generally accepted accounting principles in the
Canada, consistently applied, as such term is further defined in Article VIII
to the Agreement.


 


“GE Canada” has the meaning ascribed thereto in the preamble to
the Agreement.


 


“GE Capital” means General Electric Capital Corporation, a
Delaware corporation.


 


“GE Fee Letter” means that certain letter, dated as of February 6,
2007 between the Lender and Borrower with respect to certain Fees to be paid
from time to time by Borrower to GE Canada.


 


“Governmental Authority” means any nation or government, any
state or other political subdivision thereof, and any agency, department or
other entity exercising executive, legislative, judicial, regulatory or
administrative functions of or pertaining to government.


 


“Guaranteed Indebtedness” means, as to any Person, any
obligation of such Person guaranteeing, providing comfort or otherwise
supporting any Indebtedness, lease, dividend, or


 


13

















 


other obligation (“primary obligation”) of any other Person
(the “primary obligor”) in any
manner, including any obligation or arrangement of such Person to (a) purchase
or repurchase any such primary obligation, (b) advance or supply funds (i) for
the purchase or payment of any such primary obligation or (ii) to maintain
working capital or equity capital of the primary obligor or otherwise to
maintain the Net Worth or solvency or any balance sheet condition of the
primary obligor, (c) purchase property, securities or services primarily
for the purpose of assuring the owner of any such primary obligation of the
ability of the primary obligor to make payment of such primary obligation, (d) protect
the beneficiary of such arrangement from loss (other than product warranties
given in the ordinary course of business) or (e) indemnify the owner of
such primary obligation against loss in respect thereof. The amount of any
Guaranteed Indebtedness at any time shall be deemed to be an amount equal to
the lesser at such time of (x) the stated or determinable amount of the
primary obligation in respect of which such Guaranteed Indebtedness is incurred
and (y) the maximum amount for which such Person may be liable pursuant to
the terms of the instrument embodying such Guaranteed Indebtedness, or, if not
stated or determinable, the maximum reasonably anticipated liability (assuming
full performance) in respect thereof.


 


“Guarantees” means, collectively, each guarantee executed by
any Guarantor in favour of Agent, for itself and the rateable benefit of the
Lenders, in respect of the Obligations of Borrower.


 


“Guarantors” means each Credit Party (other than the Borrower),
and each other Person, if any, that executes a guarantee or other similar
agreement in favour of the Agent, for itself and the rateable benefit of the
Lenders, in connection with the transactions contemplated by the Agreement and
the other Loan Documents.


 


“Hazardous Material” means any substance, material or waste
that is regulated by, or forms the basis of liability now or hereafter under,
any applicable Environmental Laws, including any material or substance that is (a) defined
as a “solid waste,” “hazardous waste,” “hazardous material,” “hazardous
substance,” “dangerous goods”, “extremely hazardous waste,” “restricted
hazardous waste,” “pollutant,” “contaminant,” “hazardous constituent,” “special
waste,” “toxic substance” or other similar term or phrase under any applicable
Environmental Laws, or (b) petroleum or any fraction or by product
thereof, asbestos, polychlorinated biphenyls (PCB’s), or any radioactive
substance.


 


“Indebtedness” means, with respect to any Person, without
duplication (a) all indebtedness of such Person for borrowed money or for
the deferred purchase price of property payment for which is deferred 6 months
or more, but excluding obligations to trade creditors incurred in the ordinary
course of business that are unsecured and not overdue by more than 6 months
unless being contested in good faith, (b) all reimbursement and other
obligations with respect to letters of credit, bankers’ acceptances and surety
bonds, whether or not matured, (c) all obligations evidenced by notes,
bonds, debentures or similar instruments, (d) all indebtedness created or
arising under any conditional sale or other title retention agreement with
respect to property acquired by such Person (even though the rights and
remedies of the seller or lender under such agreement in the event of default
are limited to repossession or sale of such property), (e) all Capital
Lease Obligations and the present value (discounted at the Index Rate as in effect
on the


 


14

















 


Closing Date) of future
rental payments under all synthetic leases, (f) all obligations of such
Person under commodity purchase or option agreements or other commodity price
hedging arrangements, in each case whether contingent or matured, (g) all
obligations of such Person under any foreign exchange contract, currency swap
agreement, interest rate swap, cap or collar agreement or other similar
agreement or arrangement designed to alter the risks of that Person arising
from fluctuations in currency values or interest rates, in each case whether
contingent or matured, (h) all Indebtedness referred to above secured by
(or for which the holder of such Indebtedness has an existing right, contingent
or otherwise, to be secured by) any Lien upon or in property or other assets
(including accounts and contract rights) owned by such Person, even though such
Person has not assumed or become liable for the payment of such Indebtedness, (i) all
annual payments and other obligations under operating leases, and (j) the
Obligations.


 


“Indemnified Liabilities” has the meaning ascribed to it in Section 1.12.


 


“Indemnified Person” has the meaning ascribed to it in Section 1.12.


 


“Individual Revolving Loan Commitment Amount” means from time
to time, in respect of a Lender, that portion of the Revolving Loan Commitment
which such Lender has severally agreed to make available to the Borrower in
accordance with this Agreement, subject to adjustment pursuant to the terms of
this Agreement.


 


“Individual Term Loan B Commitment Amount” means from time to
time, in respect of a Lender, that portion of the Term Loan B Commitment which
such Lender has severally agreed to make available to the Borrower in
accordance with this Agreement.


 


“Insolvency Laws” shall mean any of the Bankruptcy and Insolvency Act (Canada), the Companies’ Creditors Arrangement Act
(Canada), and the Winding-Up and
Restructuring Act (Canada), each as now and hereafter in effect, any
successors to such statutes and any other applicable insolvency or other
similar law of any jurisdiction, including any law of any jurisdiction
permitting a debtor to obtain a stay or a compromise of the claims of its
creditors against it.


 


“Instruments” means all “instruments,”
as such term is defined in the PPSA, now or hereafter owned or acquired by any
Credit Party, wherever located, and, in any event, including, all certificates
of deposit, and all promissory notes and other evidences of indebtedness, other
than instruments that constitute, or are a part of a group of writings that
constitute, Chattel Paper.


 


“Intellectual Property” means any and all Licenses, Patents,
Designs, Copyrights, Trademarks, trade secrets and customers lists.


 


“Interest Expense” means, with respect to any Person for any
period, (a) consolidated total interest expense of such Person for such
period and including, in any event, (i) interest capitalized during such
period and net costs under Interest Rate Contracts for such period and (ii) all
fees, charges, commissions, discounts and other similar obligations (other than
reimbursement obligations) with respect to letters of credit, bank guarantees,
bankers’ acceptances, surety bonds and performance bonds (whether or not
matured) payable by such Person during such period


 


15

















 


minus (b) the
sum of (i) consolidated net gains of such Person under Interest Rate
Contracts for such period and (ii) consolidated interest income of such
Person for such period.


 


“Interest Payment Date”  means
(i) for interest calculated based on Canadian Prime Rate, the last day of
each Fiscal Month; and (ii) for interest calculated based on the BA Rate,
the last day of the applicable BA Period; provided that, in addition to the
foregoing, each of (x) the date upon which all of the Commitments have
been terminated and the Loans have been paid in full and (y) the
Commitment Termination Date  shall
be deemed to be an “Interest Payment Date” with respect to any interest that
has then accrued under the Agreement.


 


“Interest Rate Contracts” means all interest rate swap
agreements, interest rate cap agreements, interest rate collar agreements and
interest rate insurance.


 


“Inventory” means any “inventory”, as such term is defined in
the PPSA, now or hereafter owned or acquired by any Credit Party, wherever
located, and in any event including inventory, merchandise, goods and other
personal property that are held by or on behalf of any Credit Party for sale,
rent or lease or are furnished or are to be furnished under a contract of
service, or that constitute raw materials, work in process, finished goods,
returned goods, supplies or materials of any kind, nature or description used
or consumed or to be used or consumed in such Credit Party’s business or in the
processing, production, packaging, promotion, delivery or shipping of the same,
including all supplies and embedded software.


 


“ITA” means the Income
Tax Act (Canada).


 


“Judgment Currency” has the meaning ascribed to it in Section 13.17(a).


 


“Judgment Conversion Date” has the meaning ascribed to it in Section 13.17(a).


 


“Key Location” means any location described as such in
Disclosure Schedule 4.2, that either (i) is used to store a material
amount of Collateral or (ii) is strategically important to such Credit
Party’s business, as determined by the Agent, acting reasonably.


 


“Lead Arrangers” means GE Capital Markets, Inc. and GE
Capital Markets (Canada) Ltd.


 


“Lenders” means (a) initially [The names of Lenders have been omitted from the SEDAR version of this
Agreement in accordance with National Instrument 51-102 in order to comply with
the confidentiality requirements of Section 13.13 of this Agreement]
and thereafter, each financial institution which may become a party to this
Agreement, as lender, by executing and delivering to the Agent and to the
Borrower an Assignment Agreement, and each of their respective successors and
permitted assigns, and “Lender”
means any one of them in such capacity and (b) solely for the purpose of
obtaining the benefit of the Liens granted to the Agent for the benefit of the
Lenders under the Collateral Documents, a Person to whom any Obligations in
respect of a Secured Rate Contract are owed. For the avoidance of any doubt,
any Person to whom any Obligations in respect of a Secured Rate Contract are
owed, but which Person does not hold any Loans or Commitments, shall not be
entitled to any other rights as a “Lender” under this Agreement or any other
Loan Document.


 


16

















 


“License” means any Copyright License, Design License, Patent
License, Trademark License or other license of rights or interests now held or
hereafter acquired by any Credit Party.


 


“Lien” means any mortgage or deed of trust, pledge,
hypothecation, assignment, deposit arrangement, lien, charge, claim, security
interest, easement or encumbrance, or preference, priority or other security
agreement or preferential arrangement of any kind or nature whatsoever
(including any lease or title retention agreement, any financing lease having
substantially the same economic effect as any of the foregoing, and the filing
of, or agreement to give, any financing statement perfecting a security
interest under the PPSA or comparable notice filing under the law of any other
jurisdiction).


 


“Limited Partnership Agreements” means, collectively: (a) the
Amended and Restated Limited Partnership Agreement dated as of March 31,
2005 in respect of Eveready Holdings Limited Partnership; (b) the Limited
Partnership Agreement dated as of December 3, 2004 in respect of Eveready
Operating Limited Partnership; (c) the Limited Partnership Agreement dated
as of December 3, 2004 in respect of JL Filtration Operating Limited
Partnership; (d) the Amended and Restated Limited Partnership Agreement
dated as of May 20, 2005 in respect of River Valley Operating Limited
Partnership; (e) the Limited Partnership Agreement dated as of May 1,
2006 in respect of Acquisition Limited Partnership; (f) the Limited
Partnership Agreement dated as of July 27, 2007 of Eveready Directional
Boring Limited Partnership; (g) the Limited Partnership Agreement dated as
of November 30, 2005 in respect of Pembina Area Landfill LP; and (h) the
Limited Partnership Agreement of Cat Tech Operating Limited Partnership dated
as of August 1, 2006.


 


“Litigation” has the meaning ascribed to it in Section 4.11.


 


“Loan Account” has the meaning ascribed to it in Section 1.11.


 


“Loan Documents” means the Agreement, the Notes, the Collateral
Documents and all other agreements, instruments, documents and certificates
identified in 2.1(a) executed and delivered to, or in favour of, Agent or
any Lenders and including all other pledges, powers of attorney, consents,
assignments, contracts, notices, letter of credit agreements and all other
written matter whether heretofore, now or hereafter executed by or on behalf of
any Credit Party, or any employee of any Credit Party, and delivered to Agent
or any Lender in connection with the Agreement or the transactions contemplated
thereby. Any reference in the Agreement or any other Loan Document to a Loan
Document shall include all appendices, exhibits or schedules thereto, and all
amendments, restatements, supplements or other modifications thereto, and shall
refer to the Agreement or such Loan Document as the same may be in effect at
any and all times such reference becomes operative.


 


“Loans” means the Revolving Loan, any Term Loans and the Term
Loan B.


 


“Material Adverse Effect” means a material adverse effect on (a) the
business, assets, operations, prospects or financial or other condition of  the Credit Parties considered as a whole, (b) Borrower’s
ability to pay any of the Loans or any of the other Obligations in accordance
with the terms of the Agreement, (c) the Collateral or Agent’s Liens, on
behalf of the Lenders, on the


 


17

















 


Collateral or the priority
of such Liens, or (d) Agent’s or any Lender’s rights and remedies under
the Agreement and the other Loan Documents. Without limiting the generality of
the foregoing, any event or occurrence adverse to one or more Credit Parties
which results or could reasonably be expected to result in losses, costs,
damages, liabilities or expenditures in excess of $6,000,000 shall constitute a
Material Adverse Effect.


 


“Maturity Date” means, for any Term Loan, the last day of the
Term Period applicable to such Term Loan, for the Term Loan B, the last day of
the Term Loan B Period and for any Bankers’ Acceptance, the date on which a
Bankers’ Acceptance matures, or the date on which a BA Equivalent Loan becomes
due and payable.


 


“Material Documents” means the Articles and the Limited
Partnership Agreements.


 


“Net Proceeds” means the amount received by the Borrower from
the sale of an Advance by way of Bankers’ Acceptance (or in the case of a BA
Equivalent Loan, the amount of such BA Equivalent Loan), less the applicable BA
Stamping Fee.


 


“Net Worth” means, in accordance with Canadian generally
accepted accounting principles, the sum of Shareholder’s capital (excluding any
goodwill) and contributed surplus plus retained earnings and any subordinated
shareholder loans plus Subordinated Debt plus preferred units where the holder
has agreed not to redeem the units without the Agent’s prior written consent
plus, without duplication, the equity component of any Subordinated Debt. For
greater clarity, any portion of Subordinated Debt or subordinated shareholder
loans due within the next 12 months and classified as current liabilities will
not be included as part of Net Worth.


 


“New Key Location” means, any location acquired after the date
of this Agreement that either (i) is used to store a material amount of
Collateral or (ii) is strategically important to such Credit Party’s
business, as determined by the Agent, acting reasonably.


 


“Non-Agreeing Lender” has the meaning ascribed to it in Section 1.2(c)(ii)(D).


 


“Non-Agreeing Lender Commitment Amount” has the meaning
ascribed to it in Section 1.2(c)(ii)(D).


 


“Non-BA Lender” means a Lender that (i) is not a bank
chartered under the Bank Act
(Canada); or (ii) has notified the Agent in writing that it is unwilling
or unable to accept Drafts.


 


“Non-Consenting Lender” has the meaning ascribed to it in Section 13.2(d).


 


“Non-Funding Lender” has the meaning ascribed to it in Section 11.9(a).


 


“Notes” means the Revolving Notes and Term Loan B Notes.


 


“Notice of Acceptance” means a notice by the Agent, on behalf
of the Revolving Lenders other than the Non-Agreeing Lenders, to the Borrower
extending the Revolving Period for 364 days from the Commitment Date.


 


18

















 


“Notice of Extension” has the meaning ascribed to it in Section 1.2(c).


 


“Notice of Revolving Credit Advance/Election of BA Periods” has
the meaning ascribed to it in Section 1.2(a).


 


“Notice of Rollover or Notice of Conversion” means, in relation
to Advances by way of Rollover or Conversion, a notice by the Borrower to the
Agent substantially in the form of Exhibit 3.4(b) with the blanks
completed.


 


“Notification Date” has the meaning ascribed to it in Section 1.2(c)(ii)(A).


 


“Obligation Currency” has the meaning ascribed to it in Section 13.17(a).


 


“Obligations” means all loans, advances, debts, liabilities and
obligations, for the performance of covenants, tasks or duties or for payment
of monetary amounts (whether or not such performance is then required or
contingent, or such amounts are liquidated or determinable) owing by any Credit
Party to Agent or any Lender or any Secured Swap Provider, and all covenants
and duties regarding such amounts, of any kind or nature, present or future,
whether or not evidenced by any note, agreement, letter of credit agreement or
other instrument, arising under the Agreement or any of the other Loan
Documents or any Secured Rate Contract. This term includes all principal,
interest (including all interest that accrues after the commencement of any
bankruptcy or insolvency proceeding upon or after the insolvency of a Credit
Party, whether or not allowed in such proceeding), Fees, hedging obligations under
swaps, caps and collar arrangements provided or arranged by any Lender or
Affiliate thereof, expenses, legal fees and any other sum chargeable to any
Credit Party under the Agreement or any of the other Loan Documents.


 


“Other Lender” has the meaning ascribed to it in Section 11.9(d).


 


“Patent License” means rights under any written agreement now
owned or hereafter acquired by any Credit Party granting any right with respect
to any invention on which a Patent is in existence.


 


“Patents” means all of the following in which any Credit Party
now holds or hereafter acquires any interest: (a) all letters patent of
invention and all applications for letters patent, all design patents and all
registrations and recordings thereof, including registrations, recordings and
applications in the Canadian Patent and Trademark Office or in any similar
office or agency in any other country or political subdivision thereof, and (b) all
reissues, continuations, continuations in part or extensions thereof.


 


“PBGC” means the Pension Benefit Guaranty Corporation.


 


“Permitted Acquisition” means: (a) an acquisition to
acquire all or substantially all of the assets or Stock of any Person where the
consideration, whether cash or other form of payment, is less than $10,000,000
(to a maximum of $40,000,000 on an annual basis) and which meets the conditions
contained in Section 7.1 of the Agreement; and (b) an
acquisition to acquire all or


 


19

















 


substantially all of the
assets or Stock of any Person where the consideration, whether cash or other
form of payment, is equal to or in excess of $10,000,000 where (i) the
Agent has received at least thirty (30) Business Days’ prior written notice of
such proposed acquisition, which notice shall include a reasonably detailed
description of such proposed Permitted Acquisition, and (ii) the
acquisition meets the conditions contained in Section 7.1 of the
Agreement, provided that such acquisition is made on terms acceptable to the
Agent and the Lenders, acting reasonably.


 


“Permitted Distribution” means (a) any distribution or
payment which the Borrower is permitted to make pursuant to the terms of the
Agreement, (b) any dividend paid by the Corporation to its shareholders, (c) any payment or distributions
made pursuant to the DRIP, (d) the repurchase for cancellation by the
Corporation of any issued and outstanding Shares of the Corporation, and (e) regularly
scheduled payments or distributions made pursuant to the Indebtedness of the
Corporation pursuant to any of its convertible unsecured subordinated
debentures, including, without limitation, the 7.00% convertible unsecured
subordinated debentures due June 30, 2011, and any payments by the
Borrower or a Credit Party to the Corporation to facilitate such a
distribution, provided such distribution has been publicly announced, except to
the extent expressly prohibited under the Agreement.


 


“Permitted Encumbrances” means the following encumbrances: (a) Liens
for taxes or assessments or other governmental Charges not yet due and payable
or which are being contested in accordance with Section 6.2(b); (b) pledges
or deposits of money securing statutory obligations under workmen’s
compensation, employment insurance, social security or public liability laws or
similar legislation; (c) pledges or deposits of money securing bids,
tenders, contracts (other than contracts for the payment of money) or leases to
which any Credit Party is a party as lessee made in the ordinary course of
business; (d) inchoate and unperfected workers’, mechanics’ or similar
liens arising in the ordinary course of business, so long as such Liens attach
only to equipment, and/or Fixtures; (e) carriers’, warehousemen’s,
suppliers’ or other similar possessory liens arising in the ordinary course of
business and securing liabilities in an outstanding aggregate amount not in
excess of $2,000,000 at any time, so long as such Liens attach only to
Inventory; (f) deposits securing, or in lieu of, surety, appeal or customs
bonds in proceedings to which any Credit Party is a party; (g) any
attachment or judgment lien not constituting an Event of Default under Section 10.1(g);
(h) presently existing or hereafter created Liens in favour of Agent, on
behalf of the Lenders; (i) Liens expressly permitted under clauses (b) and
(c) of Section 7.8 of the Agreement; and (j) to the extent not
included in clause (a), (d) or (e), Prior Claims that are unregistered and
secure amounts that are not yet due and payable.


 


“Person” means any individual, sole proprietorship,
partnership, joint venture, trust, unincorporated organization, association,
corporation, limited liability company, institution, public benefit
corporation, other entity or government (whether federal, provincial, state,
county, city, municipal, local, foreign, or otherwise, including any
instrumentality, division, agency, body or department thereof).


 


“Pledge Agreements” means either the pledge agreements (i) entered
into pursuant to the Existing Credit Agreement or (ii) entered into
pursuant to this Agreement or any other Loan Document, by any Credit Party in
favour of the Lenders.


 


20
















 


“PPSA” shall mean the Personal
Property Security Act (Alberta)
and the Regulations thereunder, as from time to time in effect, provided,
however, if attachment, perfection or priority of Agent’s security interests in
any Collateral are governed by the personal property security laws of any
jurisdiction other than Alberta, PPSA shall mean those personal property
security laws in such other jurisdiction for the purposes of the provisions
hereof relating to such attachment, perfection or priority and for the definitions
related to such provisions.


 


“Prior Claims” shall mean all Liens created by applicable law
(in contrast with Liens voluntarily granted) which rank or are capable of
ranking prior or pari passu with
Agent’s security interests (or interests similar thereto under applicable law)
against all or part of the Collateral, including for amounts owing for employee
source deductions, goods and services taxes, sales taxes, harmonized sales
taxes, municipal taxes, workers’ compensation, corporate taxes, pension fund
obligations and overdue rents.


 


“Proceeds” means “proceeds,”
as such term is defined in the PPSA, and in any event shall include (a) any
and all proceeds of any insurance, indemnity, warranty or guarantee payable to
any Credit Party from time to time with respect to any of the Collateral, (b) any
and all payments (in any form whatsoever) made or due and payable to any Credit
Party from time to time in connection with any requisition, confiscation,
condemnation, seizure or forfeiture of all or any part of the Collateral by any
Governmental Authority (or any Person acting under color of governmental
authority), (c) any claim of any Credit Party against third parties (i) for
past, present or future infringement of any Patent or Patent License, or (ii) for
past, present or future infringement or dilution of any Copyright, Copyright
License, Design, Design License, Trademark or Trademark License, or for injury
to the goodwill associated with any Trademark or Trademark License, (d) any
recoveries by any Credit Party against third parties with respect to any
litigation or dispute concerning any of the Collateral including claims arising
out of the loss or non-conformity of, interference with the use of, defects in,
or infringement of rights in, or damage to, Collateral, (e) all amounts
collected on, or distributed on account of, other Collateral, including
dividends, interest, distributions and Instruments with respect to Investment
Property and pledged Stock, and (f) any and all other amounts, rights to
payment or other property acquired upon the sale, lease, license, exchange or
other disposition or dealing with any of the Collateral and all rights arising
out of Collateral.


 


“Projections” means the Corporation’s forecasted consolidated
and consolidating: (a) balance sheets; (b) profit and loss
statements; (c) cash flow statements; and (d) capitalization
statements, all prepared on a Subsidiary by Subsidiary or division-by-division
basis, if applicable, and otherwise consistent with the historical Financial Statements
of Borrower, together with appropriate supporting details and a statement of
underlying assumptions.


 


“Proposed Change” has the meaning ascribed to it in Section 13.2(d).


 


“Pro-Rata Share” means with respect to all matters relating to
any Lender (a) with respect to the Revolving Loan, the percentage obtained
by dividing (i) the Individual Revolving Loan Commitment of that Lender by
(ii) the aggregate Revolving Loan Commitments of all Lenders, (b) with
respect to all Term Loans, the percentage obtained by dividing (i) the
portion of the Term Loan held by that Lender by (ii) the aggregate Term
Loans, as any such percentages may


 


21

















 


be adjusted by assignments
permitted pursuant to Article XI, (c) with respect to the Term Loan
B, the percentage obtained by dividing (i) the Individual Term Loan B
Commitment of that Lender by (ii) the aggregate Term Loan B Commitments of
all Lenders, (d) with respect to all Loans, the percentage obtained by
dividing (i) the aggregate Commitments of that Lender by (ii) the
aggregate Commitments of all Lenders, and (e) with respect to all Loans on
and after the Commitment Termination Date, the percentage obtained by dividing (i) the
aggregate outstanding principal balance of the Loans held by that Lender, by (ii) the
outstanding principal balance of the Loans held by all Lenders.


 


“Purchasing Lender” has the meaning ascribed to it in Section 1.2(c)(ii)(D).


 


“Rateable Portion” means, at any time and from time to time
with respect to each Lender in respect of the Loans, the proportion of the
Individual Revolving Loan Commitment Amount of such Lender relative to the
Revolving Loan Commitment.


 


“Rate Contracts” means swap agreements (as such term is defined
in Section 101 of the U.S. Bankruptcy
Code) and any other agreements or arrangements designed to provide
protection against fluctuations in interest or currency exchange rates.


 


“Rate of Exchange” has the meaning ascribed to it in Section 13.17.


 


“Real Estate” means any real property of a Credit Party,
whether owned, leased, subleased, controlled or used by such Credit Party.


 


“Release” means any release, threatened release, spill,
emission, leaking, pumping, pouring, emitting, emptying, escape, injection,
deposit, disposal, discharge, dispersal, dumping, leaching or migration of
Hazardous Material in the indoor or outdoor environment, including the movement
of Hazardous Material through or in the air, soil, surface water, ground water
or property.


 


“Replacement Lender” has the meaning ascribed to it in Section 1.15(c).


 


“Replacement Revolving Lender” has the meaning ascribed to it
in Section 1.2(c)(ii)(D).


 


“Requisite Lenders” means Lenders holding more than 66 2/3% of
the Revolving Loan Commitment, any Term Loans and the Term Loan B Commitment,
except to the extent applicable to the Revolving Loans, Term Loans or Term Loan
B only in which case it means the Lenders holding more than 66 2/3% of such
Commitments or Loans.


 


“Reserves” means, with respect to the Borrowing Base of Borrower
(a) reserves established pursuant to Section 6.4(c), and (b) such
other reserves against Borrowing Availability of Borrower that Agent may, in
its reasonable credit judgment, establish from time to time. Without limiting
the generality of the foregoing, Reserves established to ensure the payment of
Prior Claims, accrued Interest Expenses or Indebtedness shall be deemed to be a
reasonable exercise of Agent’s credit judgment.


 


22

















 


“Restricted Payment” means, with respect to any Consolidated
Party (a) the declaration or payment of any dividend or the incurrence of
any liability to make any other payment or distribution of cash or other
property or assets in respect of Stock; (b) any payment on account of the
purchase, redemption, defeasance, sinking fund or other retirement of such
Consolidated Party’s Stock or any other payment or distribution made in respect
thereof, either directly or indirectly; (c) any payment or prepayment of
principal of, premium, if any, or interest, fees or other charges on or with
respect to, and any redemption, purchase, retirement, defeasance, sinking fund
or similar payment and any claim for rescission with respect to, any
Subordinated Debt; (d) any payment made to redeem, purchase, repurchase or
retire, or to obtain the surrender of, any outstanding warrants, options or
other rights to acquire Stock of such Consolidated Party now or hereafter
outstanding; (e) any payment of a claim for the rescission of the purchase
or sale of, or for material damages arising from the purchase or sale of, any
shares of such Consolidated Party’s Stock or of a claim for reimbursement,
indemnification or contribution arising out of or related to any such claim for
damages or rescission; (f) any payment, loan, contribution, or other
transfer of funds or other property to any Stockholder of such Consolidated
Party other than payment of compensation in the ordinary course of business to
Stockholders who are employees of such Consolidated Party; and (g) any
payment of management fees (or other fees of a similar nature) by such
Consolidated Party to any Stockholder of such Consolidated Party or its
Affiliates.


 


“Revolving Credit Advance” has the meaning ascribed to it in Section 1.2(a).


 


“Revolving Lender” means any Lender under the Revolving Loan
Commitment.


 


“Revolving Loan” means the aggregate amount of Revolving Credit
Advances outstanding to Borrower that have not been converted to a Term Loan.


 


“Revolving Loan Commitment” means the aggregate commitment of
the Lenders to make Revolving Credit Advances, which aggregate commitment shall
be one hundred million dollars ($100,000,000) on the Closing Date, as such
amount may be adjusted, if at all, from time to time in accordance with the
Agreement.


 


“Revolving Note” has the meaning ascribed to it in Section 1.2(b).


 


“Revolving Period” means the period commencing on April 25,
2007 and ending at the start of the Term Period.


 


“Rollover” means, in relation to maturing Banker’s Acceptances,
the issuance of new Bankers’ Acceptances in respect of all or any portion of
such Bankers’ Acceptances at their Maturity Date.


 


“Secured Rate Contract” means any Rate Contract between a
Credit Party and (i) a Lender or an Affiliate of a Lender (or a Person who
was a Lender or an Affiliate of a Lender at the time of execution and delivery
of such Rate Contract) or (ii) a Person with whom a Credit Party has
entered into a Rate Contract provided or arranged by GE Capital, or an
Affiliate of GE Capital, and any assignee thereof, which meets the requirements
of Section 7.4(a)(vi) and which in the case of (i) above, except
for Swing Line F/X Contracts representing total hedged currency


 


23

















 


amounts of less than
$1,000,000 in the aggregate, the Agent has acknowledged in writing is a “Secured
Rate Contract”, such acknowledgement not to be unreasonably withheld.


 


“Secured Rate Contract Support Document” means any document (a) entered
into to provide credit enhancements for the benefit of the counterparty to a
Rate Contract into which the Borrower entered, which credit enhancements are
provided (i) solely to support the payment obligations of the Borrower
under such Rate Contract and (ii) by GE Capital or any other Person at a
time when such Person is the Agent, a Lender, of an Affiliate of a Lender, and (b) is
expressly identified as being a “Secured Rate Contract Support Document”
hereunder in a joint notice from the Borrower and the Person providing such
credit enhancements delivered to the Agent reasonably promptly after the
execution or issuance of such document, unless such Person is the Agent or an
Affiliate of the Agent at the time such credit enhancements are provided.


 


“Secured Swap Provider” means any Person that has entered into
a Secured Rate Contract with a Credit Party.


 


“Security Agreement” means the Security Agreement (i) of
even date herewith or (ii) entered into pursuant to the Existing Credit
Agreement between the Lender and the Credit Party that is a signatory thereto.


 


“Settlement Date” has the meaning ascribed to it in Section 11.9(a).


 


“Shareholders” means the shareholders of the Corporation.


 


“Solvent” shall mean, with respect to any Person on a
particular date, that on such date (i) the property of such Person is
sufficient, if disposed of at a fairly conducted sale under legal process, to
enable payment of all its obligations, due and accruing due, (ii) the
property of such Person is, at a fair valuation, greater than the total amount
of liabilities, including contingent liabilities, of such Person; (iii) such
Person has not ceased paying its current obligations in the ordinary course of
business as they generally become due; and (iv) such Person is not for any
reason unable to meet its obligations as they generally become due. The amount
of contingent liabilities (such as litigation, guarantees and pension plan
liabilities) at any time shall be computed as the amount that, in light of all
the facts and circumstances existing at the time, represents the amount that
can be reasonably be expected to become an actual or matured liability.


 


“SPV” means any special purpose funding vehicle identified as
such in writing by any Lender to Agent.


 


“Stock” means all shares, options, warrants, general or limited
partnership interests, fund or trust units, membership interests or other
equivalents (regardless of how designated) of or in a corporation, partnership,
mutual fund, trust, limited liability company or equivalent entity whether
voting or non-voting, participating or non-participating, including common
stock, preferred stock or any other equity security.


 


“Stockholder” means, with respect to any Person, each holder of
Stock of such Person.


 


24

















 


“Subordinated Debt” means (i) such Indebtedness of any
Credit Party that is subordinated to the Loan pursuant to a subordination and
postponement agreement or otherwise on terms acceptable to Agent in its sole
discretion; and (ii) Indebtedness of the Corporation pursuant to any of
its convertible unsecured subordinated debentures, including without
limitation, the 7.00% convertible unsecured subordinated debentures due June 30,
2011; and (iii) except for purposes of determining “Net Worth” and “Unfinanced
Capital Expenditures”, the Employee Unit Plan Guarantees.


 


“Subsidiary” means, with respect to any Person, (a) any
corporation of which an aggregate of more than 50% of the outstanding Stock
having ordinary voting power to elect a majority of the board of directors of
such corporation (irrespective of whether, at the time, Stock of any other
class or classes of such corporation shall have or might have voting power by
reason of the happening of any contingency) is at the time, directly or
indirectly, owned legally or beneficially by such Person or one or more
Subsidiaries of such Person, or with respect to which any such Person has the
right to vote or designate the vote of 50% or more of such Stock whether by
proxy, agreement, operation of law or otherwise, and (b) any partnership
or limited liability company in which such Person and/or one or more
Subsidiaries of such Person shall have an interest (whether in the form of
voting or participation in profits or capital contribution) of more than 50% or
of which any such Person is a general partner or may exercise the powers of a
general partner. Unless the context otherwise requires, each reference to a
Subsidiary shall be a reference to a Subsidiary of the Corporation.


 


“Swing Line F/X Contracts” means Rate Contracts between any
Credit Party and the majority Swing Line Lender relating to US and Canadian
currency exchange rates.


 


“Swing Line Lender” means any Revolving Lender which is
designated as such by Agent from time to time.


 


“Swing Line Loan” means Loans made in accordance with Section 1.3.


 


“Swing Line Loan Limit” means $20,000,000.


 


“Target” has the meaning assigned to it in Section 7.1(a).


 


“Tax” and “Taxes”
includes all present and future taxes, surtaxes, duties, levies, imposts,
rates, fees, assessments, withholdings and other charges of any nature
(including income, corporate, capital (including large corporations), Net
Worth, sales, consumption, use, transfer, goods and services, value-added,
stamp, registration, franchise, withholding, payroll, employment, health,
education, employment insurance, pension, excise, business, school, property,
occupation, customs, anti-dumping and countervail taxes, surtaxes, duties,
levies, imposts, rates, fees, assessments, withholdings and other charges)
imposed by any Governmental Authority, together with any fines, interest,
penalties or other additions on, to, in lieu of, for non-collection of or in
respect of those taxes, surtaxes, duties, levies, imposts, rates, fees,
assessments, withholdings and other charges.


 


“Term Loan” has the meaning assigned to it in Section 1.2(d).


 


25

















 


“Term Loan B” means the aggregate of the Term Loan B Advances
outstanding to the Borrower.


 


“Term Loan B Advance” has the meaning assigned to it in Section 1.4.


 


“Term Loan B Commitment” means the aggregate commitment of the
Lenders to make Term Loan B Advances, which aggregate commitment shall be one
hundred and fifty million dollars ($150,000,000) on the Closing Date.


 


“Term Loan B Lender” means any Lender under Term Loan B.


 


“Term Loan B Note” has the meaning ascribed to it in Section 1.4(b).


 


“Term Loan B Period” means, with respect to the Term Loan B,
the period commencing at 12: 01 a. m. (Toronto time) on the Closing Date and
expiring on the day which is 61 months thereafter.


 


“Term Period” means, with respect to the Term Loan, the period
commencing at 5:01 p. m. (Toronto time) on the Commitment Termination Date and
expiring on the day which is 36 months thereafter.


 


“Trademark License” means rights under any written agreement
now owned or hereafter acquired by any Credit Party granting any right to use
any Trademark.


 


“Trademarks” means all of the following now owned or hereafter
adopted or acquired by any Credit Party: (a) all trademarks, trade names,
corporate names, business names, trade styles, service marks, logos, other
source or business identifiers, prints and labels on which any of the foregoing
appear or have, to the knowledge of any Credit Party, appeared, designs and
Intangibles of like nature (whether registered or unregistered), all
registrations and recordings thereof, and all applications in connection
therewith, including registrations, recordings and applications in the Canadian
Patent and Trademark Office or in any similar office or agency in any other
country or any political subdivision thereof; (b) all reissues, extensions
or renewals thereof; and (c) all goodwill associated with or symbolized by
any of the foregoing.


 


“Unfinanced Capital Expenditures” means Capital Expenditures
which are not financed with the net proceeds of any new equity issuance,
Capital Lease, the Loans or Subordinated Debt, provided that for purposes of
determining if Capital Expenditures are financed with Revolving Credit
Advances, the lesser of: (a) the net increase in the aggregate Revolving
Credit Advances during the period plus Excess Cash Flow (plus or minus Working
Capital adjustments), and (b) the sum of the Borrowing Availability plus
the Revolving Loan then outstanding; will be deemed to have been used to
finance Capital Expenditures.


 


“Working Capital” means Current Assets minus Current
Liabilities as of the last reporting period.


 


“Working Capital Ratio” means Current Assets to Current
Liabilities.


 


26

















 


Rules of construction
with respect to accounting terms used in the Agreement or the other Loan
Documents shall be as set forth in Article VIII. Unless otherwise
specified, references in the Agreement or any of the Appendices to a Section,
subsection or clause refer to such Section, subsection or clause as contained
in the Agreement. The words “herein,” “hereof” and “hereunder” and other words
of similar import refer to the Agreement as a whole, including all Annexes,
Exhibits and Schedules, as the same may from time to time be amended, restated,
modified or supplemented, and not to any particular section, subsection or
clause contained in the Agreement or any such Annex, Exhibit or Schedule.


 


Wherever from the context it
appears appropriate, each term stated in either the singular or plural shall
include the singular and the plural, and pronouns stated in the masculine,
feminine or neuter gender shall include the masculine, feminine and neuter
genders. The words “including”, “includes” and “include” shall be deemed to be
followed by the words “without limitation”; the word “or” is not exclusive;
references to Persons include their respective successors and assigns (to the
extent and only to the extent permitted by the Loan Documents) or, in the case
of governmental Persons, Persons succeeding to the relevant functions of such
Persons; and all references to statutes and related regulations shall include
any amendments of the same and any successor statutes and regulations. Whenever
any provision in any Loan Document refers to the knowledge (or an analogous
phrase) of any Credit Party, such words are intended to signify that such
Credit Party has actual knowledge or awareness of a particular fact or
circumstance or that such Credit Party, if it had exercised reasonable
diligence, would have known or been aware of such fact or circumstance.


 


27

















 


Annex B (Section 11.9(a))


 


EVEREADY ENERGY SERVICES CORP.


 


Lenders’ Wire Transfer Information


 


Certain
information has been intentionally deleted from the SEDAR version of this
Agreement in accordance with section 12.2 (3) of National Instrument
51-102. The disclosure of this information to the general public would be
seriously prejudicial to the interests of Eveready Inc. or would violate
confidentiality provisions. Such information is not essential in order to
understand the material terms of this Agreement.


 
















 


ANNEX C (Section 13.10)


 


EVEREADY ENERGY SERVICES CORP.


 


Notice Addresses


 


	
  (A)

  	
  If
  to Agent or GE Canada, at:

  
	
   

  	
   

  
	
   

  	
  GE
  Canada Asset Financing Holding Company

  
	
   

  	
  530
  8th Avenue SW, Suite 720

  
	
   

  	
  Calgary,
  AB, Canada T2P 3S8

  
	
   

  	
   

  
	
   

  	
  Attention:
  Ron Tratch

  
	
   

  	
   

  
	
   

  	
  Facsimile
  No.:

  	
  (403)
  215-5831

  
	
   

  	
  Telephone
  No.:

  	
  (403)
  571-2261

  
	
   

  	
   

  
	
  (B)

  	
  If
  to a Credit Party, at

  
	
   

  	
   

  
	
   

  	
  14904-121A
  Avenue

  
	
   

  	
  Edmonton,
  AB, Canada T5V 1A3

  
	
   

  	
   

  
	
   

  	
  Attention:
  President

  
	
   

  	
   

  
	
   

  	
  Facsimile
  No.:

  	
  (780)
  451-6075

  
	
   

  	
  Telephone No.:

  	
  (780) 451-6969

  



 

















 


Annex D (from Annex A)


 


EVEREADY ENERGY SERVICES CORP.


 


Commitments as of Closing Date


 


Certain
information has been intentionally deleted from the SEDAR version of this
Agreement in accordance with section 12.2(3) of National Instrument
51-102. The disclosure of this information to the general public would be
seriously prejudicial to the interests of Eveready Inc. or would violate
confidentiality provisions. Such information is not essential in order to
understand the material terms of this Agreement.


 

















 


Annex E (from Annex A)


 


EVEREADY ENERGY SERVICES CORP.


 


Assessed Equipment


 


Certain
information has been intentionally deleted from the SEDAR version of this
Agreement in accordance with section 12.2(3) of National Instrument
51-102. The disclosure of this information to the general public would be
seriously prejudicial to the interests of Eveready Inc. or would violate
confidentiality provisions. Such information is not essential in order to
understand the material terms of this Agreement.


 

















 


Exhibit 1.2(a)


 


EVEREADY ENERGY SERVICES CORP.


 


Notice of Revolving Credit Advance/Election of BA Periods


 


Capitalized
terms used herein which are defined in the amended and restated credit
agreement dated as of December 31, 2008 by and among Eveready Energy
Services Corp. (“Borrower”), the other
Credit Parties signatory thereto, GE Canada Asset Financing Holding Company, as
Agent, the Persons signatory thereto from time to time as Lenders (“Lenders”) (the “Credit
Agreement”), shall have the meanings therein defined. Borrower
hereby certifies that on the date hereof and on the borrowing date set forth
below: (i) all representations and warranties made by a Credit Party
contained in the Credit Agreement and the other Loan Documents are, and will
be, true and correct, both before and after giving
effect to the Revolving Credit Advance and to the application of the proceeds
thereof, as though made on such date, unless stated to relate to a specific
earlier date, in which case such representations and warranties shall be true
and correct as of such earlier date and except for changes therein expressly
permitted or expressly contemplated by the Credit Agreement; (ii) no
Material Adverse Effect has occurred since the Closing Date; (iii) no
Default or Event of Default exists, or would result from such Revolving Credit
Advance or from the application of the proceeds thereof; and (iv) after
giving effect to any Advance, the outstanding principal amount of the
Revolving Loan will not exceed the lesser of (A) the Borrowing Base and (B) the
Revolving Loan Commitment.


 


	
  Client
  and Address

  	
  Name
  of Contact

  	
  Phone

  
	
  Eveready
  Energy Services Corp.

  	
   

  	
   

  
	
  14904
  – 121A Avenue

  	
   

  	
  Fax

  
	
  Edmonton,
  AB T5V 1A3

  	
   

  	
   

  
	
  Bank 

  	
  Wire Information

  	
  ABA#

  
	
   

  	
   

  	
   

  
	
  Address

  	
   

  	
  Acct#

  
	
   

  	
   

  	
   

  
	
  Bank
  Contact

  	
   

  	
   

  



 


1.               The drawdown date is the        day
of                    ,
200   .


 


2.               Pursuant to Section 1.2(a) of
the Credit Agreement, the Borrower hereby irrevocably requests that a Revolving
Credit Advance in the amount of
$               be
made available by the Lenders on the date referred to in #1 above.


 


3.               Pursuant to Section 1.7(a) of
the Credit Agreement, the Borrower hereby irrevocably elects that [the BA
Period in respect of the Revolving Credit Advance requested in #2 above is [1]
[2] [3] month(s).] [or] [the Revolving Credit Advance bear interest at the
Canadian Prime Rate plus the applicable margin.] [or] [The Contract Period in
respect of the Revolving Credit Advance by way of Bankers’ Acceptance is [1] [2] [3] [4] [5]
[6] month(s).]


 

















 


The Borrower has caused this Request to be executed by its
duly authorized officer as of the date and year first written above.


 


	
  Authorization

  	
   

  	
   

  	
   

  
	
  Requested
  by:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Duly
  Authorized Signatory

  
	
   

  	
   

  	
   

  
	
  Fax to:

  	
   

  	
  GE
  Canada Asset Financing Holding Company, as Agent

  
	
   

  	
   

  	
  (403)
  215-5831

  
	
  Phone:

  	
   

  	
  (403)
  571-2261

  



 

















 


Exhibit 1.2(b)


 


EVEREADY ENERGY SERVICES CORP.


 


Form of Revolving Note


 


FORM OF REVOLVING NOTE (CDN$)


 


Calgary, Alberta   


 


	
  $[                            ]

  	
  [Date]

  



 


FOR VALUE RECEIVED, the
undersigned, Eveready Industrial Services Corp. (‘Borrower”),
HEREBY PROMISES TO PAY to the order of [                                ]
(“Revolving Lender”) at the offices of GE CANADA ASSET FINANCING HOLDING COMPANY, as Agent on
behalf of the Lenders (“Agent”), at its
address at 530-8th Avenue S.W., Suite 720, Calgary, AB, Canada,
T2P 3S8, or at such other place as Agent may designate from time to time in
writing, in lawful money of Canada and in immediately available funds, the
amount of
$                          CANADIAN
DOLLARS (CDN$                                   )
or, if less, the aggregate unpaid amount of all Revolving Credit Advances made
to the undersigned under the “Credit Agreement” (as hereinafter defined). All
capitalized terms used but not otherwise defined herein have the meanings given
to them in the Credit Agreement or in Annex A thereto.


 


This
Revolving Note is one of the Revolving Notes issued pursuant to that certain
amended and restated credit agreement dated as of April 25, 2007 by and
among Eveready Industrial Services Corp., as Borrower, the other Persons named
therein as Credit Parties, Agent on behalf of the Lenders, the other Persons
signatory thereto from time to time as Lenders (including all annexes, exhibits
and schedules thereto and as from time to time amended, restated, supplemented
or otherwise modified, the “Credit Agreement”)
and is entitled to the benefit and security of the Credit Agreement,
the Collateral Documents and all of the other Loan Documents referred to
therein. Reference is hereby made to the Credit Agreement for a statement of
all of the terms and conditions under which the Loans evidenced hereby are made
and are to be repaid. The date and amount of each Revolving Credit Advance made
by Revolving Lender to Borrower, the rates of interest applicable thereto and
each payment made on account of the principal thereof, shall be recorded by
Agent on its books; provided, that the failure of Agent to make any such
recordation shall not affect the obligations of Borrower to make a payment when
due of any amount owing under the Credit Agreement or this Revolving Note in
respect of the Revolving Credit Advances made by Revolving Lender to Borrower.


 


The
principal amount of the indebtedness evidenced hereby shall be payable in the
amounts and on the dates specified in the Credit Agreement, the terms of which
are hereby incorporated herein by reference. Interest thereon shall be paid
until such principal amount is paid in full at such interest rates and at such
times, and pursuant to such calculations, as are specified in the Credit Agreement.


 


If
any payment on this Revolving Note becomes due and payable on a day other than
a Business Day, the maturity thereof shall be extended to the next succeeding
Business Day and, with respect to payments of principal, interest thereon shall
be payable at the then applicable rate during such extension.


 

















 


Upon
and after the occurrence of any Event of Default, this Revolving Note may, as
provided in the Credit Agreement, and without demand, notice or legal process
of any kind, be declared, and immediately shall become, due and payable.


 


Time
is of the essence in this Revolving Note. Demand, presentment, protest and
notice of non-payment and protest are hereby waived by Borrower.


 


Except
as provided in the Credit Agreement, this Revolving Note may not be assigned by
Revolving Lender to any Person.


 


THIS
REVOLVING NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS
OF THE PROVINCE OF ALBERTA APPLICABLE TO CONTRACTS MADE AND PERFORMED IN THAT
PROVINCE.


 


	
   

  	
  EVEREADY
  INDUSTRIAL SERVICES CORP.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:
  

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:
  

  
	
   

  	
   

  	
  Title:

  



 


2
















 


Exhibit 1.2(c)


 


EVEREADY ENERGY SERVICES CORP.


 


Notice of Extension


 


	
  TO:

  	
  GE
  Canada Asset Financing Holding Company, as Agent

  530
  8th Avenue SW, Suite 720

  Calgary,
  Alberta T2P 3S8

  
	
   

  	
   

  
	
   

  	
  Attention:

  	
  Ron Tratch

  
	
   

  	
  Fax:

  	
  (403) 215-5831

  
	
   

  	
   

  	
   

  
	
  DATE:

  	
  [·]

  	
   

  



 


Dear
Sirs/Mesdames:


 


Capitalized
terms used herein which are defined in the Amended and Restated Credit
Agreement dated as of December 31, 2008 by and among Eveready Energy
Services Corp. (the “Borrower”), the
other Credit Parties signatory thereto, GE Canada Asset Financing Holding
Company, as Agent, and the persons signatory thereto from time to time as
Lenders (“Lenders”) shall have the meanings
therein defined.


 


The
Borrower hereby gives notice of its request for an offer of extension of the
Revolving Period in respect of the Extendible Revolving Credit Facility for a
further period of 364 days from the Commitment Termination Date pursuant to Section 1.2(c) of
the Credit Agreement.


 


As
of the date hereof, there exists no Default or Event of Default. 


 


	
  Yours
  very truly,

  	
   

  
	
   

  	
   

  
	
  EVEREADY
  ENERGY SERVICES CORP.

  	
   

  
	
   

  	
   

  
	
  Per:

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Per:

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  



 

















 


Exhibit 1.4(b)


 


EVEREADY ENERGY SERVICES CORP.


 


Form of Term Loan B Note


 


FORM OF TERM LOAN B NOTE (CDN$)


 


Calgary, Alberta   


 


	
  $[                                ]

  	
  [Date]

  



 


FOR VALUE RECEIVED, the undersigned, Eveready
Industrial Services Corp. (‘Borrower”),
HEREBY PROMISES TO PAY to the order of [                            ]
(“Term Loan B Lender”) at the offices of GE CANADA ASSET FINANCING HOLDING COMPANY, as Agent on
behalf of the Term Loan B Lenders (“Agent”), at its
address at 530-8th Avenue SW, Suite 720, Calgary, AB, Canada
T2P 3S8, or at such other place as Agent may designate from time to time in
writing, in lawful money of Canada and in immediately available funds, the
amount of $                        CANADIAN
DOLLARS (CDN$                       )
or, if less, the aggregate unpaid amount of all Term Loan B Credit Advances
made to the undersigned under the “Credit Agreement” (as
hereinafter defined). All capitalized terms used but not otherwise defined
herein have the meanings given to them in the Credit Agreement or in Annex A
thereto.


 


This
Term Loan B Note is one of the Term Loan B Notes issued pursuant to that
certain amended and restated credit agreement dated as of April 25, 2007
by and among Eveready Industrial Services Corp., as Borrower, the other Persons
named therein as Credit Parties, Agent on behalf of the Lenders, the other
Persons signatory thereto from time to time as Lenders (including all annexes,
exhibits and schedules thereto and as from time to time amended, restated,
supplemented or otherwise modified, the “Credit Agreement”)
and is entitled to the benefit and security of the
Credit Agreement, the Collateral Documents and all of the other Loan Documents
referred to therein. Reference is hereby made to the Credit Agreement for a
statement of all of the terms and conditions under which the Loans evidenced
hereby are made and are to be repaid. The date and amount of each Term Loan B
Advance made by Term Loan B Lender to Borrower, the rates of interest
applicable thereto and each payment made on account of the principal thereof;
shall be recorded by Agent on its books; provided, that the failure of Agent to
make any such recordation shall not affect the obligations of Borrower to make
a payment when due of any amount owing under the Credit Agreement or this Term
Loan B Note in respect of the Term Loan B Advances made by Term Loan B Lender
to Borrower.


 


The
principal amount of the indebtedness evidenced hereby shall be payable in the
amounts and on the dates specified in the Credit Agreement, the terms of which
are hereby incorporated herein by reference. Interest thereon shall be paid
until such principal amount is paid in full at such interest rates and at such
times, and pursuant to such calculations, as are specified in the Credit
Agreement.


 


If
any payment on this Term Loan B Note becomes due and payable on a day other
than a Business Day, the maturity thereof shall be extended to the next
succeeding Business Day and, with respect to payments of principal, interest
thereon shall be payable at the then applicable rate during such extension.


 

















 


Upon
and after the occurrence of any Event of Default, this Term Loan B Note may, as
provided in the Credit Agreement, and without demand, notice or legal process
of any kind, be declared, and immediately shall become, due and payable.


 


Time
is of the essence in this Term Loan B Note. Demand, presentment, protest and
notice of non-payment and protest are hereby waived by Borrower.


 


Except
as provided in the Credit Agreement, this Term Loan B Note may not be assigned
by Term Loan B Lender to any Person.


 


THIS
TERM LOAN B NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS
OF THE PROVINCE OF ALBERTA APPLICABLE TO CONTRACTS MADE AND PERFORMED IN THAT
PROVINCE.


 


	
   

  	
  EVEREADY
  INDUSTRIAL SERVICES CORP.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  



 


2

















 


Exhibit 3.4(c)


 


EVEREADY ENERGY SERVICES CORP.


 


Notice of Rollover or Notice of Conversion


 


	
  TO:

  	
  GE
  CANADA ASSET FINANCE HOLDING COMPANY (the “Agent”) as  agent for the
  Lenders under the Credit Agreement.

  
	
   

  	
   

  
	
  RE:

  	
  EVEREADY
  ENERGY SERVICES CORP. – Amended and Restated Credit  Agreement
  made as of December 31, 2008 between Eveready Energy Services Corp. (the
  “Borrower”), the other Credit parties
  thereto, the Lenders and the Agent (the “Credit Agreement”).

  



 


1.                                       Capitalized
terms used herein which are defined in the Credit Agreement shall have the
meanings therein defined.


 


2.                                       Pursuant to Section 3.4(c) of
the Credit Agreement, the undersigned hereby irrevocably notifies the Agent
that it will be:


 


(a)                                  rolling over part or all of
the Advance made under the Credit Agreement described as:


 


Type of Advance:


*[Principal Amount:]


Date of Maturity:


 


into
the same Advance made under the Credit Agreement


Date of Maturity:


 






*if
only part of maturing Advance is rolled over, please indicate.


or;


(b)                                 converting part or all of
the Advance under the Credit Agreement described as:


 


Type of Advance:


*[Principal Amount:]


Date of Maturity:


 


into
an Advance made under the Credit Agreement described as: 


 






*if
only part of maturing Advance is converted, please indicate.


 


Type of Advance:


Principal Amount:


Date of Maturity:


 

















 


effective
the                        day
of                            ,                               .


 


or;


 


(c)                                  Repaying part or all of the
Advance made under the Credit Agreement described  as:


 


Type of Advance:


*[Principal Amount]:


Date of Maturity:


 






(1) If only part of the maturing Advance is
being repaid, please indicate the applicable amount being repaid including the
details provided above in respect thereof and whether the balance will be
rolled over or converted.


 


3.                                       To the extent
that this Notice rolls over or converts any Advance to Bankers’ Acceptances, [all, Schedule I] [choose one or more as applicable]
Lenders will purchase them at the
applicable Discount Rate] [or] [[the Borrower [will/will not] market the Bankers’
Acceptances.]]


 


4.                                       This Notice is
irrevocable.


 


5.                                       No Default or
Event of Default has occurred and is continuing.


 


6.                                       Capitalized
words and phrases used herein and not otherwise defined herein have the
meanings attributed to them in or for the purposes of the Credit Agreement.


 


The Borrower has caused this notice to be executed by its duly
authorized officer this [·] day of [·], 200[·].


 


	
   

  	
  EVEREADY ENERGY SERVICES CORP.

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  



 

















 


Exhibit 5.1(b)


 


EVEREADY ENERGY SERVICES CORP.


 


Borrowing Base Certificate


 


	
  TO:

  	
  GE
  Canada Asset Financing Holding Company, as Agent

  
	
   

  	
  530
  8th Avenue SW, Suite 720

  
	
   

  	
  Calgary,
  Alberta T2P 3S8

  
	
   

  	
   

  
	
   

  	
  Attention:

  	
  Ron
  Tratch

  
	
   

  	
  Fax:

  	
  (403)
  215-5831

  
	
   

  	
   

  	
   

  
	
  RE:

  	
  Amended
  and Restated Credit Agreement dated as of December 31, 2008 (the “Credit Agreement”) by and among Eveready
  Energy Services Corp., the other Credit Parties signatory thereto, the Agent
  and the persons signatory thereto from time to time as Lenders.

  



 


This
Borrowing Base Certificate is delivered pursuant to Section 5.1(b) of
the Credit Agreement. The Borrower hereby certifies that:


 


1.                    This Borrowing Base
Certificate is current to [·], 200[·] (the “Effective Date”).


 


2.                    I am familiar with the
provisions of the Credit Agreement and I have made or caused to be made under
my supervision such reasonable investigations of corporate records and
inquiries of other officers and personnel of the Credit Parties as I have
deemed necessary for purposes of this Borrowing Base Certificate.


 


3.                    As of the Effective Date,
the Borrowing Base was Cdn. $[·], an amount
equal to:


 


(a)                        up to seventy-five percent
(75%) of the Fund and its Subsidiaries’ eligible accounts receivable, plus up
to sixty percent (60%) of the Fund and its Subsidiaries’ eligible U.S.
domiciled accounts receivable, plus up to ninety percent (90%) of the Fund and
its Subsidiaries’ eligible EDC insured amount of any accounts receivable;


 


(b)                       the amount of the Fund and
its Subsidiaries’ eligible Inventory, up to the lesser of: (i) fifty
percent (50%) of its cost (FIFO) or (ii) its market value, and, Inventory
shall not account for more than 20% of the total Borrowing Base margin; and


 


(c)                        up to seventy-five (75%) of
the orderly liquidation value of the eligible appraised Equipment,


 


the
detailed calculations of which are attached hereto as Exhibit 1.


 


Capitalized
words and phrases used herein and not otherwise defined herein have the meanings
attributed to them in or for the purposes of the Credit Agreement.


 

















 


The
Borrower has caused this Borrowing Base Certificate to be executed and
delivered, and the certification contained herein to be made by a duly
authorized officer of the Borrower this [·] day of [·], 200[·].


 


 


	
  EVEREADY
  ENERGY SERVICES CORP.

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  Per:

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Per:

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  



 

















 


EXHIBIT 1

TO THE BORROWING BASE CERTIFICATE OF

EVEREADY ENERGY SERVICES CORP.

DATED [·l, 200[·]


 


CALCULATION OF BORROWING BASE


 
















 


Exhibit 6.8(a)


 


EVEREADY ENERGY SERVICES CORP.


 


Form of Environmental Certificate


 


ENVIRONMENTAL CERTIFICATE


 


	
  TO:

  	
  GE CANADA ASSET FINANCING
  HOLDING COMPANY, as agent (the “Agent”)

  
	
   

  	
   

  
	
  RE:

  	
  Amended and Restated
  Credit Agreement dated as of December 31, 2008 (the “Credit
  Agreement”) by and among Eveready Energy Services Corp. (the “Borrower”), the other Credit Parties signatory thereto,
  the Agent and the persons signatory thereto from time to time as Lenders.

  



 


The
undersigned, John Stevens, being the Chief Financial Officer of the Borrower,
hereby certifies in such capacity for and on behalf of the Borrower, and not in
his personal capacity, as follows:


 


1.             Except as set
forth in Disclosure Schedule (4.16) of the Credit Agreement, as of the date
hereof: (i) all Real Estate owned, occupied or controlled by the Credit
Parties is free of the presence of any Hazardous Material except for such
presence that would not adversely impact the value or marketability of such
Real Estate, that is not in breach of Environmental Laws, and that would not
result in Environmental Liabilities that could reasonably be expected to exceed
$500,000 in the aggregate; (ii) no Credit Party has caused or suffered to
occur any Release of Hazardous Materials on, at, in, under, above, to, from or
about any of its Real Estate that could reasonably be expected to result in
Environmental Liabilities that exceed $500,000 in the aggregate; (iii) the
Credit Parties are, and have been, in compliance with, all Environmental Laws,
except where the failure to so comply with such Environmental Laws would not
result in Environmental Liabilities that could reasonably be expected to exceed
$500,000 in the aggregate; (iv) the Credit Parties have obtained, and are
in compliance with, all Environmental Permits required by Environmental Laws
for the operations of their respective businesses as presently conducted or as
proposed to be conducted, except where the failure to so obtain or comply with
such Environmental Permits would not result in Environmental Liabilities that
could reasonably be expected to exceed $500,000 in the aggregate, and all such
Environmental Permits are valid, uncontested and in good standing; (v) no
Credit Party is involved in operations or knows of any facts, circumstances or
conditions, including any Releases of Hazardous Materials, that are likely to
result in any Environmental Liabilities of such Credit Party which could
reasonably be expected to exceed $500,000 in the aggregate; (vi) No Credit
Party is subject to any existing, pending, or has knowledge of any, threatened
Litigation arising under or related to any Environmental Laws, Environmental
Permits or Hazardous Material that seeks damages, penalties, fines, costs or
expenses in excess of $500,000 in the aggregate or injunctive relief against,
or that alleges criminal misconduct by, any Credit Party; (vii) no Credit
Party has knowledge of, nor has any Credit Party received notice of any actual,
pending or threatened


 

















 


investigations,
claims, orders, suits, actions or proceedings regarding the breach of any
Environmental Laws or the provisions of any Environmental Permits, or which may
result in any Environmental Liability, that could reasonably be expected to
exceed $500,000 in the aggregate; and (viii) the Credit Parties have provided
to Agent copies of all existing environmental reports, reviews and audits and
all written information within their control pertaining to actual or potential
Environmental Liabilities, in each case relating to any Credit Party.


 


2.             The Assessed
Equipment has been maintained and operated in accordance with prudent industry
standards and all Environmental Laws and no Credit Party has knowledge of any
fact, circumstance or condition in respect of the Assessed Equipment or its
maintenance or operation that is likely to result in any Environmental
Liabilities that could reasonably be expected to exceed $500,000 in the
aggregate, or investigation, claim, order, suit, action or proceedings
regarding the breach of any Environmental Laws, or the provisions of any
Environmental Permits, that could reasonably be expected to result in
Environmental Liabilities that exceed $500,000 in the aggregate.


 


The
undersigned acknowledges that the Agent is relying on this Certificate in
connection with Advances made or to be made under the Credit Agreement.


 


The
undersigned further acknowledges that this certificate is binding on it, and
that if there is any false or misleading information provided herein or
pursuant hereto, an Event of Default shall be deemed to have occurred under the
Credit Agreement.


 


All
capitalized terms used in this Certificate but not defined in this Certificate
shall have the meanings given to them in the Credit Agreement.


 


 


DATED this [·] day of [·],[·].


 


	
   

  	
  EVEREADY
  ENERGY SERVICES CORP.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
  I
  have authority to bind the Corporation.

  



 

















 


Exhibit 11.1(b)


 


EVEREADY ENERGY SERVICES CORP.


 


Form of Assignment Agreement


 


ASSIGNMENT AGREEMENT


 


This Assignment Agreement (this “Agreement”) is made as
of               ,
200    between
                                 (“Assignor
Lender”) and                                     
 (“Assignee Lender”) and
acknowledged and consented to by GE CANADA
ASSET FINANCING HOLDING COMPANY, as agent (“Agent”). All capitalized terms used in this Agreement and not otherwise
defined herein have the respective meanings set forth in the Credit Agreement
as hereinafter defined.


 


RECITALS


 


WHEREAS Eveready Energy Services
Corp., as borrower (“Borrower”), the other Credit
Parties thereunder from time to time, the other Persons signatory thereto as
Lenders from time to time and the Agent entered into an amended and restated
credit agreement dated as of December 31, 2008 (as amended, restated,
supplemented and otherwise modified from time to time, the “Credit Agreement”) pursuant to which Assignor Lender has agreed to make certain
Advances to Borrower.


 


WHEREAS Assignor Lender desires to
assign to Assignee Lender [all/a portion] of its interest in the Advances and
the Collateral and to delegate to Assignee Lender [all/a portion] of its
Commitments and other duties with respect to the Advances and the
Collateral.


 


WHEREAS Assignee Lender desires to
become a Lender under the Credit Agreement and to accept such assignment and
delegation from Assignor Lender.


 


WHEREAS Assignee Lender desires to
appoint Agent to serve as Agent for Assignee Lender under the Credit Agreement.


 


FOR VALUE RECEIVED, Assignor Lender and Assignee
Lender agree as follows:


 


SECTION 1


ASSIGNMENT, DELEGATION AND ACCEPTANCE


 


1.1          Assignment


 


Assignor
Lender hereby transfers and assigns to Assignee Lender, without recourse and
without representations or warranties of any kind (except as set forth in Section 3.2),
[all/such percentage] of Assignor
Lender’s right, title, and interest in the [Revolving
Loan], [Term Loan], the Loan Documents and the Collateral as will
result in Assignee Lender having, as of the Effective Date (as hereinafter
defined), a Pro Rata Share thereof, as follows:


 

















 


	
  Assignee

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Lender’s Commitment

  	
   

  	
  Principal Amount

  	
   

  	
  Pro Rata Share

  	
   

  
	
  [Revolving Loan

  	
   

  	
  $

  	
   

  	
   

  	
   

  	
  ]%

  
	
  [Term Loan

  	
   

  	
  $

  	
   

  	
   

  	
   

  	
  ]%

  



 


1.2          Delegation


 


Assignor
Lender hereby irrevocably assigns and delegates to Assignee Lender [all/a portion] of its Commitments and its
other duties and obligations as a Lender under the Loan Documents equivalent to
[100%/            %] of Assignor Lender’s Commitment under
the [Revolving Loan] [Term Loan] (such
percentage representing a Commitment of $             ).


 


1.3          Acceptance by Assignee


 


By
its execution of this Agreement, Assignee Lender hereby irrevocably purchases,
assumes and accepts such assignment and delegation and agrees to be a Lender
with respect to the delegated interest under the Loan Documents and to be bound
by the terms and conditions thereof. By its execution of this Agreement,
Assignor Lender agrees, to the extent provided herein, to relinquish its rights
and be released from its obligations and duties under the Credit Agreement.


 


1.4          Effective Date


 


Such
assignment and delegation by Assignor Lender and acceptance by Assignee Lender
will be effective, and Assignee Lender will become a Lender under the Loan
Documents, as of the date of this Agreement (“Effective Date”) and
upon payment of the Assigned Amount and the Assignment Fee (as each term is
defined below). Interest and Fees accrued prior to the Effective Date are for
the account of Assignor Lender, and interest and Fees accrued from and after
the Effective Date are for the account of Assignee Lender.


 


SECTION 2


INITIAL PAYMENT


 


2.1          Payment of the Assigned Amount


 


Assignee
Lender will pay to Assignor Lender, for value not later than 12:00 noon on the
Effective Date, an amount equal to its Pro Rata Share of the then outstanding
principal amount of the Advances, as set forth above in Section 1.1
together with accrued interest, fees and other amounts as set forth on Schedule
2.1 (the “Assigned Amount”).


 


2.2          Payment of Assignment Fee


 


[Assignor Lender and/or Assignee Lender] will pay to
Agent, for its own account, for value not later than 12:00 noon (Toronto time)
on the Effective Date, the assignment fee in the amount of $3,500 (the “Assignment Fee”), as required pursuant to Section 11.1(a) of the Credit
Agreement.


 


2

















 


2.3          Execution and Delivery of Notes.


 


Following
payment of the Assigned Amount and the Assignment Fee, Assignor Lender will
deliver to Agent the Notes previously delivered to Assignor Lender for
redelivery to Borrower and Agent will obtain from Borrower for delivery to [Assignor Lender and] Assignee Lender, new executed Notes
evidencing Assignee Lender’s [and Assignor
Lender’s respective] Pro Rata Share[s] in the Loan after giving
effect to the assignment described in Section 1. Each new Note will be
issued in the aggregate maximum principal amount of the [applicable] Commitment [of the Lender to whom such Note is issued] OR [the
Assignee Lender].


 


SECTION 3

REPRESENTATIONS, WARRANTIES AND COVENANTS


 


3.1          Assignee Lender’s Representations, Warranties and Covenants


 


Assignee
Lender hereby represents, warrants, and covenants to Assignor Lender and Agent
the following:


 


(1)                                  this Agreement
is a legal, valid, and binding agreement of Assignee Lender, enforceable
against Assignee Lender according to its terms;


 


(2)                                  the execution
and performance by Assignee Lender of its duties and obligations under this
Agreement and the Loan Documents will not require any registration with, notice
to, or consent or approval by any Governmental Authority;


 


(3)                                  Assignee Lender
is familiar with transactions of the kind and scope reflected in the Loan
Documents and in this Agreement;


 


(4)                                  Assignee Lender
has made its own independent investigation and appraisal of the financial
condition and affairs of each Credit Party, has conducted its own evaluation of
the Loans, the Loan Documents and each Credit Party’s creditworthiness, has
made its decision to become a Lender to Borrower under the Credit Agreement
independently and without reliance upon Assignor Lender or Agent, and will
continue to do so;


 


(5)                                  Assignee Lender
is entering into this Agreement in the ordinary course of its business, and is
acquiring its interest in the Loans and the Commitments for its own account and
not with a view to or for sale in connection with any subsequent distribution;
provided, however, that at all times the distribution of Assignee Lender’s
property shall, subject to the terms of the Credit Agreement, be and remain
within its control; and


 


(6)                                  As of the
Effective Date, Assignee Lender, (i) is not subject to capital adequacy or
similar requirements under Section 1.15(a) of the Credit Agreement, (ii) does
not require the payment of any amount on account of increased costs under Section 1.15(b) of
the Credit Agreement, and Assignee Lender will indemnify. Agent from and
against all liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, or expenses that result from any inaccuracy in the
foregoing.


 


3

















 


3.2                               Assignor
Lender’s Representations, Warranties and Covenants


 


Assignor
Lender hereby represents, warrants and covenants to Assignee Lender the
following:


 


(1)           Assignor Lender
is the legal and beneficial owner of the Assigned Amount;


 


(2)           this Agreement
is a legal, valid and binding agreement of Assignor Lender, enforceable against
Assignor Lender according to its terms;


 


(3)           the execution
and performance by Assignor Lender of its duties and obligations under this
Agreement and the Loan Documents will not require any registration with, notice
to or consent or approval by any Governmental Authority;


 


(4)           Assignor Lender
has full power and authority, and has taken all action necessary, to execute
and deliver this Agreement and to fulfill the obligations hereunder and to
consummate the transactions contemplated hereby;


 


(5)           Assignor Lender
is the legal and beneficial owner of the interests being assigned hereby, free
and clear of any adverse claim, lien, encumbrance, security interest,
restriction on transfer, purchase option, call or similar right of a third
party; and


 


(6)           this Assignment
by Assignor Lender to Assignee Lender complies, in all material respects, with
the terms of the Loan Documents.


SECTION 4

LIMITATIONS OF LIABILITY


 


Neither
Assignor Lender (except as provided in Section 3.2) nor Agent makes any
representations or warranties of any kind, nor assumes any responsibility or
liability whatsoever, with regard to (a) the Loan Documents or any other
document or instrument furnished pursuant thereto or the Advances or the
Commitments or other Obligations, (b) the creation, validity, genuineness,
enforceability, sufficiency, value or collectibility of any of them, (c) the
amount, value or existence of the Collateral, (d) the perfection or
priority of any Lien upon the Collateral, or (e) the financial condition
of any Credit Party or other obligor or the performance or observance by any
Credit Party of its obligations under any of the Loan Documents. Neither
Assignor Lender nor Agent has or will have any duty, either initially or on a
continuing basis, to make any investigation, evaluation, appraisal of, or any
responsibility or liability with respect to the accuracy or completeness of,
any information provided to Assignee Lender which has been provided to Assignor
Lender or Agent by any Credit Party. Nothing in this Agreement or in the Loan
Documents shall impose upon the Assignor Lender or Agent any fiduciary
relationship in respect of the Assignee Lender.


 


SECTION 5

FAILURE TO ENFORCE


 


No
failure or delay on the part of Agent or Assignor Lender in the exercise of any
power, right, or privilege hereunder or under any Loan Document will impair
such power, right, or privilege


 


4

















 


or
be construed to be a waiver of any default or acquiescence therein. No single
or partial exercise of any such power, right, or privilege will preclude
further exercise thereof or of any other right, power, or privilege. All rights
and remedies existing under this Agreement are cumulative with, and not
exclusive of, any rights or remedies otherwise available.


 


SECTION 6

NOTICES


 


Unless
otherwise specifically provided herein, any notice or other communication
required or permitted to be given will be in writing and addressed to the
respective party as set forth below its signature hereunder, or to such other
address as the party may designate in writing to the other.


 


SECTION 7

AMENDMENTS AND WAIVERS


 


No
amendment, modification, termination, or waiver of any provision of this
Agreement will be effective without the written concurrence of Assignor Lender,
Agent and Assignee Lender.


 


SECTION 8

SEVERABILITY


 


Whenever
possible, each provision of this Agreement will be interpreted in such manner
as to be effective and valid under applicable law. In the event any provision
of this Agreement is or is held to be invalid, illegal, or unenforceable under
applicable law, such provision will be ineffective only to the extent of such
invalidity, illegality, or unenforceability, without invalidating the remainder
of such provision or the remaining provisions of this Agreement. In addition,
in the event any provision of or obligation under this Agreement is or is held
to be invalid, illegal, or unenforceable in any jurisdiction, the validity,
legality, and enforceability of the remaining provisions or obligations in any
other jurisdictions will not in any way be affected or impaired thereby.


 


SECTION 9

SECTION TITLES


 


Section and
subsection titles in this Agreement are included for convenience of reference
only, do not constitute a part of this Agreement for any other purpose, and
have no substantive effect.


 


SECTION 10

SUCCESSORS AND ASSIGNS


 


This
Agreement shall be binding upon and inure to the benefit of the parties hereto
and their respective successors and assigns.


 


5

















 


SECTION II

APPLICABLE LAW


 


This
Agreement will be construed in accordance with and governed by the laws of the
Province of Alberta applicable to contracts made and performed in that
Province.


 


SECTION 12

COUNTERPARTS


 


This
Agreement and any amendments, waivers, consents, or supplements may be executed
in any number of counterparts and by different parties hereto in separate
counterparts, each of which, when so executed and delivered, will be deemed an
original and all of which shall together constitute one and the same
instrument.


 


IN WITNESS WHEREOF, this Agreement has been
duly executed as of the date first written above.


 


	
  ASSIGNEE LENDER:

  	
   

  	
  ASSIGNOR LENDER:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  	
  Name:

  
	
   

  	
  Title:

  	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Notice
  Address:

  	
   

  	
  Notice
  Address:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  



 


	
  ACKNOWLEDGED AND CONSENTED TO:

  	
   

  	
   

  
	
   

  GE CANADA ASSET FINANCING HOLDING COMPANY, as Agent 

  	
   

  	
  Provided
  that no Event of Default has occurred and is continuing: EVEREADY
  ENERGY SERVICES CORP., as
  Borrower 

  
	
   

  	
   

  	
   

  



 


	
  By:

  	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  	
  Name:

  
	
   

  	
  Duly
  Authorized Signatory 

  	
   

  	
   

  	
  Duly
  Authorized Signatory

  



 


6
















 


Schedule 6.4


 


EVEREADY ENERGY SERVICES CORP.


 


Insurance


 


The
Borrower shall arrange and maintain property and casualty insurance with the
following preferred specifications for an optimal insurance program:


 


1.             General
Requirements:


a.             insurance
companies rated A- X or higher by A.M. Best or reasonably acceptable to
the Administrative Agent


b.             carriers must
be authorized to do business in Canada and US for respective exposures


c.             industry
standard or better for terms and conditions, including but not limited to,
limits, deductibles and sublimits to the extent not listed in this schedule


d.             favorable
wording for non-vitiation and separation of insureds


e.             Lenders and
Administrative Agent as additional insured on all policies except where
prohibited by law (Workers Compensation and Employer’s Liability) as their
interests may appear


f.              Lenders and
Administrative Agent provided waiver of subrogation on all policies where
permitted


g.             Collateral
Agent as additional insured as its interest may appear and loss payee on
property (including physical damage for vehicles and mobile equipment), boiler
and machinery (if separate) and business interruption policies, during the term
of the Financing Agreement


h.             30 day prior
notice of cancellation except 10 days for non payment of premium


i.              Administrative
Agent reserves the right at any time upon any change in Borrower’s risk profile
or as a result of any change in law affecting the potential liability of such
Borrow to require an increase in coverage or limits


j.              within ten (10) days
of renewal of each policy the Borrower’s insurance, Borrower’s insurance broker
shall provide evidence of such renewal information as reasonably required by
Administrative Agent


k.             Borrower shall
notify Administrative Agent of any loss with the potential of exceeding
US$1,000,000


 


2.             Commercial
General Liability


a.             occurrence
policy form or AEGIS claims-first-made policy form


b.             personal injury
/ bodily injury, including death


c.             premises /
operations


d.             products /
completed operations — at least $2,000,000 aggregate


e.             XCU cover
(removal of explosion, collapse and underground exclusion)


 

















 


f.              broad form
property damage


g.             broad form contractual
liability


h.             separation of
insureds clause


i.              cross liability if multiple
named insureds


j.              punitive damages to extent
permitted by law


k.             at least $1,000,000 per
occurrence


l.              Non-Owned Automobile
Coverage


 


3.             Automobile
Liability


a.             cover all owned
hired and non-owned autos using in the Borrower’s business (where the
Commercial General Liability Coverage does not apply)


b.             at least
$1,000,000 any one accident


c.             Canadian and
United States (federal and state) statutory coverage forms, as applicable


 


4.             Workers
Compensation / Employer’s Liability


a.             statutory
workers compensation benefits coverage


b.             employer’s
liability limit of at least $1,000,000 (part of general liability policy in
Canada)


c.             USL&H and
Jones Act cover to the extent exposure exists


d.             other forms as
required by law


 


5.             Umbrella /
Excess Liability


a.             Excess of
commercial general liability, automobile liability, employers liability


b.             Occurrence
policy form or AEGIS claims made policy form


c.             Limit of at
least $10,000,000 per occurrence


 


6.             Pollution
Liability


a.             at least
$3,000,000 per occurrence


b.             discovery and
notification of at least 7 days and 45 days respectively


c.             can be included
under combination of primary general liability policy and an excess (umbrella)
liability policy


 


7.             Property All
Risk Insurance


a.             all risk
property and machinery breakdown insurance, including business interruption on
at least industry standard policy form


b.             if machinery
breakdown and all risk property written on separate policies, joint loss
agreement on each policy


c.             perils to
include but not be limited to earthquake, flood and windstorm


d.             policy to insure
all property and equipment and machinery that are part of the project and
property of others for which insured may be liable (such as rail cars which may
be included here or on a separate policy)


e.             transit
insurance, as required, with a limit sufficient to cover the full value of
property in transit


 

















 


f.              losses adjusted
on a repair or replacement cost basis


g.             all risk limit
equivalent to full replacement cost of all insurable property, however the
following extensions and perils may be sublimited:


·      Property at Unscheduled
Locations


·      Expediting Expense


·      Newly Acquired Property


·      Rented / Leased
Equipment


·      Pollutant
Cleanup and Removal


·      Demolition /
Incidental Course of Construction


·      Windstorm — at
least 25% of full replacement cost of facility


·      Earthquake — at
least 25% of full replacement cost of facility


·      Flood — at
least 25% of full replacement cost of facility


·      Debris removal


·      Escalation
clause


h.             coinsurance
clause permitted with compliance


i.              blanket waiver
of subrogation as required by contract


j.              deductibles not
to exceed $25,000 for physical damage except $50,000 for machinery breakdown
and 30 days for business interruption (time element)


k.             loss payee as
required under the Financing Agreement as their interests may appear. Standard mortgage
clause approved by the Insurance Bureau of Canada and separately for the US
coverages


 


8.             Inland Marine
Insurance


a.             coverage for
all mobile equipment and truck mounted equipment of the owner or such equipment
for which owner has responsibility for damage or loss


b.             perils to
include but not be limited to earthquake, flood and windstorm


c.             losses adjusted
on a repair or replacement cost basis up to market value of the equipment
involved


d.             coinsurance
clause permitted with compliance


e.             blanket waiver
of subrogation as required by contract


f.              deductibles not
to exceed $25,000


g.             loss payee as
required under the Financing Agreement as their interests may appear.


 

















 


Disclosure Schedule 4.1


 


EVEREADY ENERGY SERVICES CORP.


 


Type of Entity; Jurisdiction of
Organization


 


(see attached)


 

















 


	
  Credit Party

  April 24, 2008

  	
   

  	
  Credit
  Party

  December 30, 2008

  	
   

  	
  Credit
  Party

  December 31, 2008

  	
   

  	
  Credit
  Party

  January 1, 2008

  	
   

  	
  Entity
  Type

  	
   

  	
  Jurisdiction
  of

  Incorporation

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  Eveready
  Inc.

  	
   

  	
  Eveready
  Inc.

  	
   

  	
  Corporation

  	
   

  	
  Alberta

  	
   

  
	
  Eveready
  Income Fund

  	
   

  	
  Eveready
  Income Fund

  	
   

  	
  Eveready
  Income Fund

  	
   

  	
  Eveready
  Income Fund

  	
   

  	
  Trust

  	
   

  	
  Alberta

  	
   

  
	
  Eveready
  Income Trust

  	
   

  	
  Eveready
  Income Trust

  	
   

  	
  Eveready
  Income Trust

  	
   

  	
  Eveready
  Income Trust

  	
   

  	
  Trust

  	
   

  	
  Alberta

  	
   

  
	
  Eveready
  Holdings Limited Partnership

  	
   

  	
  Eveready
  Holdings Limited Partnership

  	
   

  	
  Eveready
  Holdings Limited Partnership

  	
   

  	
  Eveready
  Holdings Limited Partnership

  	
   

  	
  Limited
  Partnership

  	
   

  	
  Alberta

  	
   

  
	
  Eveready
  Holdings GP Ltd.

  	
   

  	
  Eveready
  Holdings GP Ltd.

  	
   

  	
  Eveready
  Holdings GP Ltd.

  	
   

  	
  Eveready
  Holdings GP Ltd.

  	
   

  	
  Corporation

  	
   

  	
  Alberta

  	
   

  
	
  River
  Valley Operating Limited Partnership

  	
   

  	
  River
  Valley Operating Limited Partnership

  	
   

  	
  River
  Valley Operating Limited Partnership

  	
   

  	
  River
  Valley Operating Limited Partnership

  	
   

  	
  Limited
  Partnership

  	
   

  	
  Alberta

  	
   

  
	
  River
  Valley Energy Services Ltd.

  	
   

  	
  River
  Valley Energy Services Ltd.

  	
   

  	
  River
  Valley Energy Services Ltd.

  	
   

  	
  River
  Valley Energy Services Ltd.

  	
   

  	
  Corporation

  	
   

  	
  Alberta

  	
   

  
	
  Winterhawk Operating Limited Partnership

  	
   

  	
  Winterhawk Operating Limited Partnership

  	
   

  	
  Winterhawk Operating Limited Partnership

  	
   

  	
   

  	
   

  	
  Limited
  Partnership

  	
   

  	
  Alberta

  	
   

  
	
  Winterhawk Enterprises (Provost) Ltd.

  	
   

  	
  Winterhawk Enterprises (Provost) Ltd.

  	
   

  	
  Winterhawk Enterprises (Provost) Ltd.

  	
   

  	
  Winterhawk Enterprises (Provost) Ltd.

  	
   

  	
  Corporation

  	
   

  	
  Alberta

  	
   

  
	
  Eveready
  Operating Limited Partnership

  	
   

  	
  Eveready
  Operating Limited Partnership

  	
   

  	
  Eveready
  Operating Limited Partnership

  	
   

  	
  Eveready
  Operating Limited Partnership

  	
   

  	
  Limited
  Partnership

  	
   

  	
  Alberta

  	
   

  
	
  JL Filtration Operating Limited Partnership

  	
   

  	
  JL Filtration Operating Limited Partnership

  	
   

  	
  JL Filtration Operating Limited Partnership

  	
   

  	
  JL Filtration Operating Limited Partnership

  	
   

  	
  Limited
  Partnership

  	
   

  	
  Alberta

  	
   

  
	
  JL Filtration Inc.

  	
   

  	
  JL Filtration Inc.

  	
   

  	
  JL Filtration Inc.

  	
   

  	
  JL Filtration Inc.

  	
   

  	
  Corporation

  	
   

  	
  Alberta

  	
   

  
	
  Eveready
  Industrial Western Ltd.

  	
   

  	
  Eveready
  Industrial Western Ltd.

  	
   

  	
  Eveready
  Industrial Western Ltd.

  	
   

  	
  Eveready
  Industrial Western Ltd.

  	
   

  	
  Corporation

  	
   

  	
  Alberta

  	
   

  
	
  Mobile
  Industrial Health Services Ltd.

  	
   

  	
  Mobile
  Industrial Health Services Ltd.

  	
   

  	
  Mobile
  Industrial Health Services Ltd.

  	
   

  	
  Mobile
  Industrial Health Services Ltd.

  	
   

  	
  Corporation

  	
   

  	
  Alberta

  	
   

  



 

















 


	
  Tri-Vax Enterprises
  Ltd.

  	
   

  	
  Tri-Vax Enterprises
  Ltd.

  	
   

  	
  Tri-Vax Enterprises
  Ltd.

  	
   

  	
  Tri-Vax Enterprises
  Ltd.

  	
   

  	
  Corporation

  	
   

  	
  Alberta

  	
   

  
	
  Acquisition Limited
  Partnership

  	
   

  	
  Acquisition Limited
  Partnership

  	
   

  	
  Acquisition Limited
  Partnership

  	
   

  	
   

  	
   

  	
  Limited Partnership

  	
   

  	
  Alberta

  	
   

  
	
  Canada-Wide Oilfield
  Services Ltd.

  	
   

  	
  Canada-Wide Oilfield
  Services Ltd.

  	
   

  	
  Canada-Wide Oilfield
  Services Ltd.

  	
   

  	
   

  	
   

  	
  Corporation

  	
   

  	
  Alberta

  	
   

  
	
  Canada-Wide Operating
  Limited Partnership

  	
   

  	
  Canada-Wide Operating
  Limited Partnership

  	
   

  	
  Canada-Wide Operating
  Limited Partnership

  	
   

  	
   

  	
   

  	
  Limited Partnership

  	
   

  	
  Alberta

  	
   

  
	
  Eveready Directional
  Boring Ltd.

  	
   

  	
  Eveready Directional
  Boring Ltd.

  	
   

  	
  Eveready Directional
  Boring Ltd.

  	
   

  	
  Eveready Directional
  Boring Ltd.

  	
   

  	
  Corporation

  	
   

  	
  Alberta

  	
   

  
	
  1225979 Alberta Ltd.

  	
   

  	
  1225979 Alberta Ltd.

  	
   

  	
  1225979 Alberta Ltd.

  	
   

  	
   

  	
   

  	
  Corporation

  	
   

  	
  Alberta

  	
   

  
	
  1202867 Alberta Ltd.

  	
   

  	
  1202867 Alberta Ltd.

  	
   

  	
  1202867 Alberta Ltd.

  	
   

  	
   

  	
   

  	
  Corporation

  	
   

  	
  Alberta

  	
   

  
	
  1240609 Alberta Ltd.

  	
   

  	
  1240609 Alberta Ltd.

  	
   

  	
  1240609 Alberta Ltd.

  	
   

  	
   

  	
   

  	
  Corporation

  	
   

  	
  Alberta

  	
   

  
	
  1206894 Alberta Ltd.

  	
   

  	
  1206894 Alberta Ltd.

  	
   

  	
  1206894 Alberta Ltd.

  	
   

  	
   

  	
   

  	
  Corporation

  	
   

  	
  Alberta

  	
   

  
	
  1233460 Alberta Ltd.

  	
   

  	
  1233460 Alberta Ltd.

  	
   

  	
  1233460 Alberta Ltd.

  	
   

  	
   

  	
   

  	
  Corporation

  	
   

  	
  Alberta

  	
   

  
	
  Eveready Directional
  Boring LP

  	
   

  	
  Eveready Directional
  Boring LP

  	
   

  	
  Eveready Directional
  Boring LP

  	
   

  	
  Eveready Directional
  Boring LP

  	
   

  	
  Limited Partnership

  	
   

  	
  Alberta

  	
   

  
	
  Astec Safety Services
  Ltd.

  	
   

  	
  Astec Safety Services
  Ltd.

  	
   

  	
  Astec Safety Services
  Ltd.

  	
   

  	
  Astec Safety Services
  Ltd.

  	
   

  	
  Corporation

  	
   

  	
  Alberta

  	
   

  
	
  1257427 Alberta Ltd.

  	
   

  	
  1257427 Alberta Ltd.

  	
   

  	
  1257427 Alberta Ltd.

  	
   

  	
   

  	
   

  	
  Corporation

  	
   

  	
  Alberta

  	
   

  
	
  Cat Tech Operating
  Limited Partnership

  	
   

  	
  Cat Tech Operating
  Limited Partnership

  	
   

  	
  Cat Tech Operating
  Limited Partnership

  	
   

  	
  Cat Tech Operating
  Limited Partnership

  	
   

  	
  Limited Partnership

  	
   

  	
  Alberta

  	
   

  
	
  Diversified Pressure
  Services Ltd.

  	
   

  	
  Diversified Pressure
  Services Ltd.

  	
   

  	
  Diversified Pressure
  Services Ltd.

  	
   

  	
   

  	
   

  	
  Corporation

  	
   

  	
  Alberta [NTD: continued
  to Alberta Dec 15th]

  	
   

  
	
  Cat Tech Canada Ltd.

  	
   

  	
  Cat Tech Canada Ltd.

  	
   

  	
  Cat Tech Canada Ltd.

  	
   

  	
  Cat Tech Canada Ltd.

  	
   

  	
  Corporation

  	
   

  	
  Nova Scotia

  	
   

  
	
  Bullseye Boring Ltd.

  	
   

  	
  Bullseye Boring Ltd.

  	
   

  	
  Bullseye Boring Ltd.

  	
   

  	
   

  	
   

  	
  Corporation

  	
   

  	
  Alberta

  	
   

  



 

















 


	
  Airborne Imaging Inc.

  	
   

  	
  Airborne Imaging Inc.

  	
   

  	
  Airborne Imaging Inc.

  	
   

  	
  Airborne Imaging Inc.

  	
   

  	
  Corporation

  	
   

  	
  Alberta

  	
   

  
	
  Rodrigue’s Directional
  Drilling Projects Inc.

  	
   

  	
  Rodrigue’s Directional
  Drilling Projects Inc.

  	
   

  	
  Rodrigue’s Directional
  Drilling Projects Inc.

  	
   

  	
   

  	
   

  	
  Corporation

  	
   

  	
  Alberta

  	
   

  
	
  Eveready Industrial
  Services Inc.

  	
   

  	
  Eveready Energy
  Services Inc. (name change)

  	
   

  	
  Eveready Energy
  Services Inc.

  	
   

  	
  Eveready Energy
  Services Inc.

  	
   

  	
  Corporation

  	
   

  	
  Nevada

  	
   

  
	
  Eveready Holdings (USA)
  Inc.

  	
   

  	
  Eveready Holdings (USA)
  Inc.

  	
   

  	
  Eveready Holdings (USA)
  Inc.

  	
   

  	
  Eveready Holdings (USA)
  Inc.

  	
   

  	
  Corporation

  	
   

  	
  Nevada

  	
   

  
	
  Safety Watch, LLC

  	
   

  	
  Safety Watch, LLC

  	
   

  	
  Safety Watch, LLC

  	
   

  	
  Safety Watch, LLC

  	
   

  	
  Corporation

  	
   

  	
  Texas

  	
   

  
	
  Cat-Tech LLC

  	
   

  	
  Cat-Tech LLC

  	
   

  	
  Cat-Tech LLC

  	
   

  	
  Cat-Tech LLC

  	
   

  	
  Corporation

  	
   

  	
  Texas

  	
   

  
	
  Breathing Systems
  International, LLC

  	
   

  	
  Breathing Systems
  International, LLC

  	
   

  	
  Breathing Systems
  International, LLC

  	
   

  	
  Breathing Systems
  International, LLC

  	
   

  	
  Corporation

  	
   

  	
  Texas

  	
   

  
	
  Great Lakes Carbon
  Treatment, Inc.

  	
   

  	
  Great Lakes Carbon
  Treatment, Inc.

  	
   

  	
  Great Lakes Carbon
  Treatment, Inc.

  	
   

  	
  Great Lakes Carbon
  Treatment, Inc.

  	
   

  	
  Corporation

  	
   

  	
  Michigan

  	
   

  
	
  River Valley Energy
  Services Inc.

  	
   

  	
  River Valley Energy
  Services Inc.

  	
   

  	
  River Valley Energy
  Services Inc.

  	
   

  	
  River Valley Energy
  Services Inc.

  	
   

  	
  Corporation

  	
   

  	
  Nevada

  	
   

  
	
  Eveready Industrial
  Services Corp.

  	
   

  	
  Eveready Energy
  Services Corp. (name change)

  	
   

  	
  Eveready Energy
  Services Corp.

  	
   

  	
  Eveready Energy
  Services Corp.

  	
   

  	
  Corporation

  	
   

  	
  Alberta

  	
   

  
	
  Denman Industrial
  Trailers Ltd.

  	
   

  	
  Denman Industrial
  Trailers Ltd.

  	
   

  	
  Denman Industrial
  Trailers Ltd.

  	
   

  	
  Denman Industrial
  Trailers Ltd.

  	
   

  	
  Corporation

  	
   

  	
  Alberta

  	
   

  
	
  Denman Industrial
  Operating LP

  	
   

  	
  Denman Industrial
  Operating LP

  	
   

  	
  Denman Industrial
  Operating LP

  	
   

  	
  Denman Industrial
  Operating LP

  	
   

  	
  Limited Partnership

  	
   

  	
  Alberta

  	
   

  



 
















 


Disclosure Schedule 4.2


 


EVEREADY ENERGY SERVICES CORP.


 


Executive Offices, Collateral Locations


 


(see attached)


 

















 


	
  Company Name

  	
   

  	
  Address
  (*** indicates Key Location)

  	
   

  
	
  Airborne Imaging Inc.

  	
   

  	
  #130, 885 - 42nd Avenue
  SE, Calgary, AB T2G 1Y8

  	
   

  
	
  Astec Safety

  	
   

  	
  4902 - 51 Avenue
  Bonnyville, AB T9N 2H4 Canada

  	
   

  
	
  Astec Safety

  	
   

  	
  215A MacKay Crescent
  Fort McMurray, AB T9H 4T5 Canada

  	
   

  
	
  Astec Safety

  	
   

  	
  2602-50 Avenue Lloydminster
  AB T9V 2S3 Canada

  	
   

  
	
  Astec Safety

  	
   

  	
  5308 - 49th Avenue
  Provost, AB T0B 3S0 Canada

  	
   

  
	
  Astec Safety

  	
   

  	
  Millenium, Box 417,
  Oyen, AB T0T 2S0 Canada

  	
   

  
	
  Breathing Systems

  	
   

  	
  3500 S Ritchie Street
  Suite 100Houston, TX 77017 USA

  	
   

  
	
  Cat Tech Canada Company

  	
   

  	
  4403 - 84th Ave
  Edmonton, AB T6B 2S6 Canada

  	
   

  
	
  Cat Tech Canada Company

  	
   

  	
  282 Tecumseh Street Samia,
  ON N7T 2K9 Canada

  	
   

  
	
  Cat Tech Canada Company

  	
   

  	
  145, Cowley Bay, Ft McMurray,
  AB, T9K 1G5 Canada

  	
   

  
	
  Cat Tech Europe

  	
   

  	
  1 South Park Road
  Scunthorpe, N Lincolnshire DN172BY United Kingdom

  	
   

  
	
  Cat Tech Inc

  	
   

  	
  15200 Middlebrook Drive
  Suite G Houston, TX 77058 USA

  	
   

  
	
  Cat Tech Inc

  	
   

  	
  9856 Steelman Street
  Houston, TX 77017 USA

  	
   

  
	
  Cat Tech Inc

  	
   

  	
  2040 Cherry Industrial
  Circle, Long Beach, CA 90805, USA

  	
   

  
	
  Cat Tech Inc

  	
   

  	
  1905 Jasmine DR., Bldg
  E, Pasadena, Texas 77503, Canada

  	
   

  
	
  Cat Tech Inc

  	
   

  	
  1861 Williamson Court,
  Louisville, KY 40223 USA

  	
   

  
	
  Cat Tech Inc

  	
   

  	
  6378 FM 105, Orange,
  Texas 77630, USA

  	
   

  
	
  Cat Tech Inc

  	
   

  	
  9236 Ashland Road, Gonzales,
  LA 70737

  	
   

  
	
  Cat Tech Inc

  	
   

  	
  PO Box 158, Harmony
  Road, and 1-295 Mickleton, NJ 08056 USA

  	
   

  
	
  Denman Industrial
  Trailers

  	
   

  	
  14907 - 111 Avenue
  Edmonton AB T5M 2P6 Canada

  	
   

  
	
  Eveready Directional
  Boring

  	
   

  	
  40 Industrial Drive,
  Sylvan Lake, AB T4S 1P4 Canada

  	
   

  
	
  Eveready Directional
  Boring

  	
   

  	
  256, 28042 HWY 11, Red
  Deer County, AB T4S 2L4, Canada***

  	
   

  
	
  Eveready Directional
  Boring

  	
   

  	
  1203 - 6 Street, Nisku,
  AB T9E 7P1 Canada

  	
   

  
	
  Eveready Directional
  Boring

  	
   

  	
  8003 - 110 Street
  Grande Prairie, AB T8W 6T2 Canada

  	
   

  
	
  Eveready Energy
  Services

  	
   

  	
  15817 - 121A Avenue
  Edmonton, AB T5V 1B1 Canada

  	
   

  
	
  Eveready Energy
  Services

  	
   

  	
  4501 Industrial Park
  Road Macklin, SK S0L 2C0 Canada

  	
   

  
	
  Eveready Energy
  Services

  	
   

  	
  525E Dewdney Avenue
  Regina SK S4N 4E9 Canada

  	
   

  
	
  Eveready Energy
  Services

  	
   

  	
  PO Box 2925, Stn Main
  1902 - 15 Avenue Wainwright, AB T9W 1S8 Canada

  	
   

  
	
  Eveready Energy
  Services

  	
   

  	
  Bag 2 Altario, AB T0C
  0E0 Canada

  	
   

  
	
  Eveready Energy
  Services

  	
   

  	
  6215 - 52 Ave Bonnyville,
  AB T9N 2L7 Canada

  	
   

  
	
  Eveready Energy
  Services

  	
   

  	
  PO Box 5330 Site: 26339
  Hwy 39 Devon, AB T9G 1Y1 Canada

  	
   

  
	
  Eveready Energy
  Services

  	
   

  	
  P.O. Box 356 Dryden, ON
  P8N 2Z1 Canada

  	
   

  
	
  Eveready Energy
  Services

  	
   

  	
  2nd flr, 901 - 77
  Avenue Edmonton, AB T6P 1M8 Canada

  	
   

  
	
  Eveready Energy
  Services

  	
   

  	
  100, 14920 - 114 Avenue
  Edmonton, AB T5M 4G4Canada

  	
   

  
	
  Eveready Energy
  Services

  	
   

  	
  127-Lot 229 26229 TWP
  Rd 531A Acheson, AB T7X 5C4 Canada

  	
   

  
	
  Eveready Energy
  Services

  	
   

  	
  230A Mackay Crescent
  Fort McMurray, AB T9H 5C6 Canada***

  	
   

  
	
  Eveready Energy
  Services

  	
   

  	
  PO Box 28 Hwy
  63 & Grassland Drive Grassland, AB T0A 1V0 Canada

  	
   

  
	
  Eveready Energy
  Services

  	
   

  	
  PO Box 213 4603 - 48
  Avenue Fort Nelson, BC V0C 1R0 Canada

  	
   

  
	
  Eveready Energy
  Services

  	
   

  	
  6708 - 87A Avenue Fort
  St John, BC V1J 0B4 Canada

  	
   

  
	
  Eveready Energy
  Services

  	
   

  	
  1 Collins Road Dawson
  Creek, BC Canada

  	
   

  
	
  Eveready Energy
  Services

  	
   

  	
  10493 - 92 Avenue High
  Level, AB T0H 1Z0 Canada

  	
   

  
	
  Eveready Energy
  Services

  	
   

  	
  PO Box 5159 High River,
  AB T1V 1M4 Canada

  	
   

  
	
  Eveready Energy
  Services

  	
   

  	
  174 Felaber Road
  Hinton, AB T7V 1Z8 Canada

  	
   

  
	
  Eveready Energy
  Services

  	
   

  	
  1115 - 11 Ave West
  Kindersley, SK S0L 1S0 Canada

  	
   

  
	
  Eveready Energy
  Services

  	
   

  	
  PO Box 11279
  Lloydminster, AB T9V 3B5

  	
   

  
	
  Eveready Energy
  Services

  	
   

  	
  PO Box 517 Macklin, SK
  S0L 2C0 Canada

  	
   

  
	
  Eveready Energy
  Services

  	
   

  	
  #1 - 5765 Turner Road,
  Suite 111 Nanaimo, BC V9T 6M4 Canada

  	
   

  
	
  Eveready Energy
  Services

  	
   

  	
  PO Box 310 Neilburg SK
  S0M 2C0 Canada

  	
   

  
	
  Eveready Energy
  Services

  	
   

  	
  PO Box 7170 Peace
  River, AB T8S 1M6 Canada

  	
   

  
	
  Eveready Energy
  Services

  	
   

  	
  #1, 405 McAloney Road
  Prince George, BC V2K 4L2 Canada

  	
   

  
	
  Eveready Energy
  Services

  	
   

  	
  3603 - 57 Avenue,
  Provost, AB, T0B 3S0 Canada

  	
   

  
	
  Eveready Energy
  Services

  	
   

  	
  2nd floor, 15830 - 121A
  Avenue Edmonton AB T5V 1B1 Canada

  	
   

  
	
  Eveready Energy
  Services

  	
   

  	
  1650 - 70 Avenue,
  Edmonton AB, T6P 1P5, Canada

  	
   

  
	
  Eveready Energy
  Services

  	
   

  	
  Av. Conselheiro
  Rodrigues Alves, 58 12620-000 Piquiet, SP - Brazil

  	
   

  



 

















 


	
  Eveready Energy
  Services

  	
   

  	
  11212 - 87 Avenue, Ft.
  Saskatchewan, AB T8L 2S4, Canada

  	
   

  
	
  Eveready Energy
  Services

  	
   

  	
  1233 Highridge Drive,
  Kamloops, BC V2C 5G5, Canada

  	
   

  
	
  Eveready Energy
  Services

  	
   

  	
  8002E 101 Avenue, peace
  River, AB T8S 1S8, Canada

  	
   

  
	
  Eveready Energy
  Services

  	
   

  	
  P.O. Box 385,
  Rainbow Lake, AB, T0H 2Y0, Canada

  	
   

  
	
  Eveready Energy
  Services

  	
   

  	
  8118 - 49 Avenue Close,
  Red Deer, AB T4P 2V5, Canada

  	
   

  
	
  Eveready Energy
  Services

  	
   

  	
  7750 Edgar Industrial
  Drive, Red Deer, AB T4P 3R2, Canada

  	
   

  
	
  Eveready Energy
  Services

  	
   

  	
  P.O. Box 2977, Samia,
  On, N7t 7W2, Canada

  	
   

  
	
  Eveready Energy
  Services

  	
   

  	
  Unit# 1404, 7 Bishop
  Avenue, Toronto, ON, M2M 4J4

  	
   

  
	
  Eveready Energy
  Services

  	
   

  	
  9856 Steelman Street,
  Houston Texas, 77017 USA

  	
   

  
	
  Eveready Energy
  Services

  	
   

  	
  PO Box 838, Evansburg,
  AB T0E 0T0 Canada

  	
   

  
	
  Eveready Energy
  Services

  	
   

  	
  Box 9, GRP 582, R.R#5,
  290 Transport Rd, Winnipeg, MB R2C 2Z2, Canada

  	
   

  
	
  Eveready Energy
  Services

  	
   

  	
  4301 - 66 Street Stettler,
  AB, T0C 2L1, Canada

  	
   

  
	
  Eveready Energy
  Services

  	
   

  	
  3475 - 35 Street,
  Whitecourt, AB T7S 1P8, Canada

  	
   

  
	
  Eveready Energy
  Services

  	
   

  	
  PO Box 8, Colleville,
  SK, S0I 0K0, Canada

  	
   

  
	
  Eveready Energy
  Services

  	
   

  	
  PO Box 11279,
  Lloydminster, AB T9V 3B5

  	
   

  
	
  Eveready Income Fund

  	
   

  	
  14904 - 121A Avenue
  Edmonton, AB T5V 1A3 Canada

  	
   

  
	
  Eveready Energy
  Services

  	
   

  	
  Site 4, Box 28, RR1,
  Sexsmith, AB, T0H 3C0, Canada

  	
   

  
	
  Eveready Energy
  Services

  	
   

  	
  1102 - 6 Street, Nisku,
  AB, T9E 7N7, Canada

  	
   

  
	
  Findit
  Inc

  	
   

  	
  PO Box 174, Okotoks, AB
  T1S 1A9 Canada

  	
   

  
	
  Great Lakes Carbon
  Treatments

  	
   

  	
  3300 US 131 North,
  Kalkaska, MI 49646 USA

  	
   

  
	
  J.L Filtration Inc

  	
   

  	
  1102 - 6Street, Nisku,
  AB T9E 7N7

  	
   

  
	
  J.L Filtration Inc

  	
   

  	
  Box 791, Slave Lake,
  AB, T0G 2A0, Canada

  	
   

  
	
  J.L Filtration Inc

  	
   

  	
  #6, 11456 - 96 Avenue,
  Grande Prairie, AB, T8V 5M4

  	
   

  
	
  Mercedes Surveys

  	
   

  	
  Site: 49014 - RR 52, PO
  Box 30, Carnwood, AB, Canada

  	
   

  
	
  Mercedes Surveys

  	
   

  	
  16, 2810 Pegasus Way
  NE, Calgary, AB T2E 8M5

  	
   

  
	
  Mobile Industrial
  Health Services

  	
   

  	
  225E Mackay Crescent,
  Fort Mc Murray, Ab T9H 4T5, Canada

  	
   

  
	
  Mobile Industrial
  Health Services

  	
   

  	
  10143 - 100 Street,
  Fort St. John, BC V1J 3Y6

  	
   

  
	
  Mobile Industrial
  Health Services

  	
   

  	
  #205, 10126 - 97
  Avenue, Grande Prairie, AB T8V 7X6, Canada

  	
   

  
	
  Mobile Industrial
  Health Services

  	
   

  	
  207, 11044 - 51 Avenue,
  Edmonton, AB T6H 5B4

  	
   

  
	
  River Valley Energy
  Services Ltd

  	
   

  	
  PO Box 1038, Grimshaw,
  AB T0h 1w0***

  	
   

  
	
  Safety Watch

  	
   

  	
  208 W. San Augustine
  Deer Park, TX 77536 USA

  	
   

  



 

















 


Disclosure Schedule 4.4(a)


 


EVEREADY ENERGY SERVICES CORP.


 


Financial Statements


 


Certain
information has been intentionally deleted from the SEDAR version of this
Agreement in accordance with section 12.2(3)
of National Instrument 51-102.  The
disclosure of this information to the general public would be seriously
prejudicial to the interests of Eveready Inc. or would violate confidentiality
provisions. Such information is not essential in order to understand the
material terms of this Agreement.


 

















 


Disclosure Schedule 4.4(b)


 


EVEREADY ENERGY SERVICES CORP.


 


Projections


 


Certain
information has been intentionally deleted from the SEDAR version of this
Agreement in accordance with section 12.2(3) of National Instrument
51-102.  The disclosure of this
information to the general public would be seriously prejudicial to the
interests of Eveready Inc. or would violate confidentiality provisions. Such
information is not essential in order to understand the material terms of this
Agreement.


 

















 


Disclosure Schedule 4.7


 


EVEREADY ENERGY SERVICES CORP.


 


Labour Matters


 


Collective
Bargaining Agreements


 


1                                          Collective
Agreement dated May 24, 2002 among Eveready Industrial Western Ltd. and  International
Union of Operating Engineers, Local 115. Revised agreement dated June 1,
2008 to May 31, 2011.


 


2.                                       The Hydraulic
Dredging Agreement dated September 20, 2001 among Fraser River Pile &
Dredge Ltd. and International Union of Operating Engineers, Local 115 and
revised through Ceda Reactor May 1, 2006 to April 30, 2009.


 


3.                                       Collective
Agreement dated July 7, 2003 among Alberta Roadbuilders Association and
International Union of Operating Engineers, Local 955.


 


4.                                       Provincial
Operating Engineers Collective Agreement for General Construction Sector dated July 29,
2004 among Construction Labor Relations (an Alberta Association) Operating
Engineers (Provincial) Trade Division and International Union of Operating
Engineers, Local 955. Revised agreement dated May 27, 2007 to April 30,
2011.


 


5.                                       Collective
Agreement dated December 1, 2006 among Eveready Industrial Services Corp.
and International Union of Operating Engineers, Local 793. Revised agreement
Dated December 1, 2008 through to November 30, 2010.


 


6.                                       Collective
Agreement Dated June 1, 2004 to May 31, 2007 with Eveready Industrial
Services Corp and the International Union of Operating Engineers Local 865
(Dryden ON) (to be revised).


 


7.                                       Collective
Agreement dated November 20, 2007 among Tri-Vax Enterprised Ltd. and the
International Brotherhood of Boilermakers, Iron Ship Builders, Blacksmiths,
Forgers and Helpers Local Lodge 146.


 


Management
Agreements


 


Certain
information has been intentionally deleted from the SEDAR version of this
Agreement in accordance with section 12.2 (3) of National Instrument 51-102.
The disclosure of this information to the general public would be seriously
prejudicial to the interests of Eveready Inc. or would violate confidentiality
provisions. Such information is not essential in order to understand the
material terms of this Agreement.


 

















 


Consulting
Agreements


 


1.                                       Consulting
Agreement dated December 31, 2005 among Eveready Industrial Services
Corp., Baimar Holdings Ltd. and Rodney F. Marlin.


 


Bonus Plans


 


Certain information has been intentionally deleted from the SEDAR
version of this Agreement in accordance with section 12.2(3) of National
Instrument 51-102. The disclosure of this information to the general public would
be seriously prejudicial to the interests of Eveready Inc. or would violate
confidentiality provisions. Such information is not essential in order to
understand the material terms of this Agreement.


 


Stock Option Plans/Stock Purchase Plans/Option Agreements/Similar
Agreements


 


1.                                       The Amended and
Restated Eveready Employee Unit Plan dated June 30, 2006 between Eveready
Income Fund and its subsidiaries and Dennis L. Nerland.


 


2.                                       Employee
Savings Plan Trust and Agent Services Agreement dated October 16, 2006
among Eveready Industrial Services Corp., Canadian Western Trust Company and
Solium Capital Inc.


 


3.                                       Various
Employee Unit Option Agreements among Eveready Income Fund and various
employees (to be replaced by the Eveready Share Option Plan effective December 31,
2008 pursuant to shareholder approval on December 11, 2008 and  disclosed in
the Management Information Circular dated November 7, 2008).


 


4.                                       The Eveready
Inc. Shareholder Rights Plan among Eveready Inc. and Computer Share Trust
Company of Canada (approved by shareholders on December 11, 2008 and
disclosed in the Management Information Circular dated November 7, 2008).


 


5.                                       The Eveready
Income Fund Deferred  Unit Plan (to be replaced by the Deferred
Share Plan effective December 31, 2008 pursuant to  shareholder
approval on December 11, 2008 and disclosed in the Management Information
Circular  dated November 7, 2008).


 


The
schedules attached to Disclosure Schedule 4.7 have been intentionally deleted
from  the SEDAR version of this Agreement in accordance with section 12.2(3) of
National Instrument 51-102. The disclosure of this information to the general
public would be seriously prejudicial to the interests of Eveready Inc. or
would violate confidentiality provisions. Such information is not essential in
order to understand the material terms of this Agreement.


 
















 


Disclosure Schedule 4.8


 


EVEREADY ENERGY SERVICES CORP.


 


Ventures, Subsidiaries and Affiliates; Outstanding Stock


 


Joint
Venture Agreements


 


1.                                       Joint Venture
Agreement dated July 23, 2004 among Innovative Coke Expulsion Inc.  (now Eveready
Industrial Services Inc.) and Inovaserv Tecnologia e Servicos Ltda.


 


Subsidiaries
and Affiliates; Outstanding Stock


 


(see attached)


 

















 


	
  Issuer

  	
   

  	
  Certificate

  Number

  	
   

  	
  Number of

  Securities

  	
   

  	
  Class of Securities

  	
   

  	
  Pledgor

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Eveready Income Fund

  	
   

  	
   

  	
   

  	
  85,478,063

  	
   

  	
  Trust Units

  	
   

  	
  Eveready Inc.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Eveready Income Trust

  	
   

  	
  1

  	
   

  	
  1

  	
   

  	
  Class A Trust
  Units

  	
   

  	
  Eveready Income Fund

  
	
   

  	
   

  	
  3

  	
   

  	
  7,626,127

  	
   

  	
  Class A Trust
  Units

  	
   

  	
  Eveready Income Fund

  
	
   

  	
   

  	
  5

  	
   

  	
  4,384,706

  	
   

  	
  Class A Trust
  Units

  	
   

  	
  Eveready Income Fund

  
	
   

  	
   

  	
  6

  	
   

  	
  2,599,179

  	
   

  	
  Class A Trust
  Units

  	
   

  	
  Eveready Income Fund

  
	
   

  	
   

  	
  7

  	
   

  	
  454,996

  	
   

  	
  Class A Trust
  Units

  	
   

  	
  Eveready Income Fund

  
	
   

  	
   

  	
  8

  	
   

  	
  236,686

  	
   

  	
  Class A Trust
  Units

  	
   

  	
  Eveready Income Fund

  
	
   

  	
   

  	
  9

  	
   

  	
  1,416,122

  	
   

  	
  Class A Trust
  Units

  	
   

  	
  Eveready Income Fund

  
	
   

  	
   

  	
  10

  	
   

  	
  1,806,007

  	
   

  	
  Class A Trust
  Units

  	
   

  	
  Eveready Income Fund

  
	
   

  	
   

  	
  11

  	
   

  	
  755,738

  	
   

  	
  Class A Trust
  Units

  	
   

  	
  Eveready Income Fund

  
	
   

  	
   

  	
  12

  	
   

  	
  260,606

  	
   

  	
  Class A Trust
  Units

  	
   

  	
  Eveready Income Fund

  
	
   

  	
   

  	
  13

  	
   

  	
  144,092

  	
   

  	
  Class A Trust
  Units

  	
   

  	
  Eveready Income Fund

  
	
   

  	
   

  	
  14

  	
   

  	
  343,879

  	
   

  	
  Class A Trust
  Units

  	
   

  	
  Eveready Income Fund

  
	
   

  	
   

  	
  15

  	
   

  	
  1,241,287

  	
   

  	
  Class A Trust
  Units

  	
   

  	
  Eveready Income Fund

  
	
   

  	
   

  	
  16

  	
   

  	
  736,772

  	
   

  	
  Class A Trust
  Units

  	
   

  	
  Eveready Income Fund

  
	
   

  	
   

  	
  17

  	
   

  	
  236,686

  	
   

  	
  Class A Trust
  Units

  	
   

  	
  Eveready Income Fund

  
	
   

  	
   

  	
  18

  	
   

  	
  262,106

  	
   

  	
  Class A Trust
  Units

  	
   

  	
  Eveready Income Fund

  
	
   

  	
   

  	
  19

  	
   

  	
  324,283

  	
   

  	
  Class A Trust
  Units

  	
   

  	
  Eveready Income Fund

  
	
   

  	
   

  	
  20

  	
   

  	
  100,000

  	
   

  	
  Class A Trust
  Units

  	
   

  	
  Eveready Income Fund

  
	
   

  	
   

  	
  21

  	
   

  	
  1,085,046

  	
   

  	
  Class A Trust
  Units

  	
   

  	
  Eveready Income Fund

  
	
   

  	
   

  	
  22

  	
   

  	
  24,153

  	
   

  	
  Class A Trust
  Units

  	
   

  	
  Eveready Income Fund

  
	
   

  	
   

  	
  23

  	
   

  	
  24,153

  	
   

  	
  Class A Trust
  Units

  	
   

  	
  Eveready Income Fund

  
	
   

  	
   

  	
  24

  	
   

  	
  21,705

  	
   

  	
  Class A Trust
  Units

  	
   

  	
  Eveready Income Fund

  
	
   

  	
   

  	
  25

  	
   

  	
  21,705

  	
   

  	
  Class A Trust
  Units

  	
   

  	
  Eveready Income Fund

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Eveready Holdings Limited
  Partnership

  	
   

  	
  1

  	
   

  	
  1

  	
   

  	
  Class A Limited
  Partnership Units

  	
   

  	
  Eveready Income Trust

  
	
   

  	
   

  	
  2

  	
   

  	
  7,626,127

  	
   

  	
  Class A Limited
  Partnership Units

  	
   

  	
  Eveready Income Trust

  
	
   

  	
   

  	
  3

  	
   

  	
  4,384,706

  	
   

  	
  Class A Limited
  Partnership Units

  	
   

  	
  Eveready Income Trust

  
	
   

  	
   

  	
  4

  	
   

  	
  2,599,179

  	
   

  	
  Class A Limited
  Partnership Units

  	
   

  	
  Eveready Income Trust

  
	
   

  	
   

  	
  5

  	
   

  	
  454,996

  	
   

  	
  Class A Limited
  Partnership Units

  	
   

  	
  Eveready Income Trust

  
	
   

  	
   

  	
  6

  	
   

  	
  236,686

  	
   

  	
  Class A Limited
  Partnership Units

  	
   

  	
  Eveready Income Trust

  
	
   

  	
   

  	
  7

  	
   

  	
  1,416,122

  	
   

  	
  Class A Limited
  Partnership Units

  	
   

  	
  Eveready Income Trust

  
	
   

  	
   

  	
  8

  	
   

  	
  1,806,007

  	
   

  	
  Class A Limited
  Partnership Units

  	
   

  	
  Eveready Income Trust

  
	
   

  	
   

  	
  9

  	
   

  	
  755,738

  	
   

  	
  Class A Limited
  Partnership Units

  	
   

  	
  Eveready Income Trust

  
	
   

  	
   

  	
  10

  	
   

  	
  260,606

  	
   

  	
  Class A Limited
  Partnership Units

  	
   

  	
  Eveready Income Trust

  
	
   

  	
   

  	
  11

  	
   

  	
  144,092

  	
   

  	
  Class A Limited
  Partnership Units

  	
   

  	
  Eveready Income Trust

  
	
   

  	
   

  	
  12

  	
   

  	
  343,879

  	
   

  	
  Class A Limited
  Partnership Units

  	
   

  	
  Eveready Income Trust

  
	
   

  	
   

  	
  13

  	
   

  	
  1,241,287

  	
   

  	
  Class A Limited
  Partnership Units

  	
   

  	
  Eveready Income Trust

  



 

















 


	
   

  	
   

  	
  14

  	
   

  	
  1,246,343

  	
   

  	
  Class A Limited
  Partnership Units

  	
   

  	
  Eveready Income Trust

  
	
   

  	
   

  	
  15

  	
   

  	
  736,772

  	
   

  	
  Class A Limited
  Partnership Units

  	
   

  	
  Eveready Income Trust

  
	
   

  	
   

  	
  16

  	
   

  	
  236,686

  	
   

  	
  Class A Limited
  Partnership Units

  	
   

  	
  Eveready Income Trust

  
	
   

  	
   

  	
  17

  	
   

  	
  262,106

  	
   

  	
  Class A Limited
  Partnership Units

  	
   

  	
  Eveready Income Trust

  
	
   

  	
   

  	
  18

  	
   

  	
  324,283

  	
   

  	
  Class A Limited
  Partnership Units

  	
   

  	
  Eveready Income Trust

  
	
   

  	
   

  	
  19

  	
   

  	
  100,000

  	
   

  	
  Class A Limited
  Partnership Units

  	
   

  	
  Eveready Income Trust

  
	
   

  	
   

  	
  20

  	
   

  	
  1,085,046

  	
   

  	
  Class A Limited
  Partnership Units

  	
   

  	
  Eveready Income Trust

  
	
   

  	
   

  	
  21

  	
   

  	
  24,153

  	
   

  	
  Class A Limited
  Partnership Units

  	
   

  	
  Eveready Income Trust

  
	
   

  	
   

  	
  22

  	
   

  	
  24,153

  	
   

  	
  Class A Limited
  Partnership Units

  	
   

  	
  Eveready Income Trust

  
	
   

  	
   

  	
  23

  	
   

  	
  21,705

  	
   

  	
  Class A Limited
  Partnership Units

  	
   

  	
  Eveready Income Trust

  
	
   

  	
   

  	
  24

  	
   

  	
  21,705

  	
   

  	
  Class A Limited
  Partnership Units

  	
   

  	
  Eveready Income Trust

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  B-157

  	
   

  	
  3,573,821

  	
   

  	
  Class B Limited
  Partnership Units

  	
   

  	
  Eveready Inc.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  C1-001

  	
   

  	
  1,641,455

  	
   

  	
  Class C Limited
  Partnership Units

  	
   

  	
  Eveready Inc.

  
	
   

  	
   

  	
  C2-001

  	
   

  	
  663,096

  	
   

  	
  Class C Limited
  Partnership Units

  	
   

  	
  Eveready Inc.

  
	
   

  	
   

  	
  C3-001

  	
   

  	
  421,254

  	
   

  	
  Class C Limited
  Partnership Units

  	
   

  	
  Eveready Inc.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Eveready Holdings GP Ltd.

  	
   

  	
  2

  	
   

  	
  10

  	
   

  	
  Common Shares

  	
   

  	
  Eveready Income Fund

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  River Valley Energy Services
  Ltd.

  	
   

  	
  2

  	
   

  	
  100

  	
   

  	
  Common Shares

  	
   

  	
  Eveready Holdings
  Limited Partnership

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  River Valley Operating Limited
  Partnership

  	
   

  	
  1

  	
   

  	
  1

  	
   

  	
  Class A Limited
  Partnership Units

  	
   

  	
  Eveready Holdings
  Limited Partnership

  
	
   

  	
   

  	
  2

  	
   

  	
  500,000

  	
   

  	
  Class A Limited
  Partnership Units

  	
   

  	
  Eveready Holdings
  Limited Partnership

  
	
   

  	
   

  	
  3

  	
   

  	
  755,738

  	
   

  	
  Class A Limited
  Partnership Units

  	
   

  	
  Eveready Holdings
  Limited Partnership

  
	
   

  	
   

  	
  4

  	
   

  	
  236,686

  	
   

  	
  Class A Limited
  Partnership Units

  	
   

  	
  Eveready Holdings
  Limited Partnership

  
	
   

  	
   

  	
  B-002

  	
   

  	
  10,524,055

  	
   

  	
  Class B Limited
  Partnership Units

  	
   

  	
  River Valley Energy
  Services Ltd.

  
	
   

  	
   

  	
  D1-002

  	
   

  	
  1,606,323.24

  	
   

  	
  Class D Series 1 Limited
  Partnership Units

  	
   

  	
  1225979 Alberta Ltd.

  
	
   

  	
   

  	
  D2-002

  	
   

  	
  4,790,000.00

  	
   

  	
  Class D Series 2 Limited
  Partnership Units

  	
   

  	
  Airborne Imaging Inc.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Eveready Energy Services Corp.

  	
   

  	
  1

  	
   

  	
  144,092

  	
   

  	
  Common Shares

  	
   

  	
  Eveready Holdings
  Limited Partnership

  



 

















 


	
  Eveready Operating Limited
  Partnership

  	
   

  	
  2

  	
   

  	
  1,080,000

  	
   

  	
  Class A Limited
  Partnership Units

  	
   

  	
  Eveready Holdings
  Limited Partnership

  
	
   

  	
   

  	
  3

  	
   

  	
  2,599,179

  	
   

  	
  Class A Limited
  Partnership Units

  	
   

  	
  Eveready Holdings
  Limited Partnership

  
	
   

  	
   

  	
  4

  	
   

  	
  324,283

  	
   

  	
  Class A Limited
  Partnership Units

  	
   

  	
  Eveready Holdings
  Limited Partnership

  
	
   

  	
   

  	
  5

  	
   

  	
  100,000

  	
   

  	
  Class A Limited
  Partnership Units

  	
   

  	
  Eveready Holdings
  Limited Partnership

  
	
   

  	
   

  	
  B-1

  	
   

  	
  16,172,500

  	
   

  	
  Class B Limited
  Partnership Units

  	
   

  	
  Eveready Energy
  Services Corp.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  JL Filtration Inc.

  	
   

  	
  2

  	
   

  	
  10

  	
   

  	
  Common Shares

  	
   

  	
  Eveready Energy
  Services Corp.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  JL Filtration Operating Limited
  Partnership

  	
   

  	
  2

  	
   

  	
  45,000

  	
   

  	
  Class A Limited
  Partnership Units

  	
   

  	
  Eveready Holdings
  Limited Partnership

  
	
   

  	
   

  	
  B-1

  	
   

  	
  673,856

  	
   

  	
  Class B Limited
  Partnership Units

  	
   

  	
  Eveready Energy
  Services Corp.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Winterhawk Enterprises
  (Provost) Ltd.

  	
   

  	
  2

  	
   

  	
  10

  	
   

  	
  Common Shares

  	
   

  	
  Eveready Energy
  Services Corp.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Winterhawk Operating Limited
  Partnership

  	
   

  	
  2

  	
   

  	
  375,000

  	
   

  	
  Class A Limited
  Partnership Units

  	
   

  	
  Eveready Holdings
  Limited Partnership

  
	
   

  	
   

  	
  3

  	
   

  	
  454,996

  	
   

  	
  Class A Limited
  Partnership Units

  	
   

  	
  Eveready Holdings
  Limited Partnership

  
	
   

  	
   

  	
  4

  	
   

  	
  343,879

  	
   

  	
  Class A Limited
  Partnership Units

  	
   

  	
  Eveready Holdings Limited
  Partnership

  
	
   

  	
   

  	
  B-1

  	
   

  	
  5,615,469

  	
   

  	
  Class B Limited
  Partnership Units

  	
   

  	
  Eveready Industrial
  Services Corp.

  
	
   

  	
   

  	
  C-1-002

  	
   

  	
  10,121,826

  	
   

  	
  Class C Series 1 Limited
  Partnership Units

  	
   

  	
  1257427 Alberta Ltd.

  
	
   

  	
   

  	
  C-001

  	
   

  	
  7,650,000

  	
   

  	
  Class C Series 2
  Limited Partnership Units

  	
   

  	
  Diversified Pressure
  Services Ltd.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Canada-Wide Oilfield Services
  Ltd.

  	
   

  	
  2

  	
   

  	
  100

  	
   

  	
  Common Shares

  	
   

  	
  Eveready Holdings
  Limited Partnership

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Canada-Wife Operating Limited
  Partnership

  	
   

  	
  1

  	
   

  	
  1

  	
   

  	
  Class A Limited
  Partnership Units

  	
   

  	
  Eveready Holdings
  Limited Partnership

  
	
   

  	
   

  	
  B-2

  	
   

  	
  7,790

  	
   

  	
  Class B Limited
  Partnership Units

  	
   

  	
  1206894 Alberta Ltd.

  
	
   

  	
   

  	
  B-4

  	
   

  	
  5,993,027

  	
   

  	
  Class B Limited
  Partnership Units

  	
   

  	
  1233460 Alberta Ltd.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Eveready Directional Boring
  Ltd.

  	
   

  	
  1

  	
   

  	
  100

  	
   

  	
  Common Shares

  	
   

  	
  Eveready Holdings
  Limited Partnership

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Eveready Directional Boring LP

  	
   

  	
  1

  	
   

  	
  1

  	
   

  	
  Class A Limited
  Partnership Units

  	
   

  	
  Eveready Holdings
  Limited Partnership

  
	
   

  	
   

  	
  B-001

  	
   

  	
  800,000

  	
   

  	
  Class B
  Series 1 Limited Partnership Units

  	
   

  	
  Acquisition Limited
  Partnership

  
	
   

  	
   

  	
  B-2-002

  	
   

  	
  299,235

  	
   

  	
  Class B
  Series 2 Limited Partnership Units

  	
   

  	
  Acquisition Limited
  Partnership

  



 

















 


	
   

  	
   

  	
  B-3-002

  	
   

  	
  221,862

  	
   

  	
  Class B
  Series 3 Limited Partnership Units

  	
   

  	
  Acquisition Limited
  Partnership

  
	
   

  	
   

  	
  C-002

  	
   

  	
  30,370,796

  	
   

  	
  Class C
  Series 1 Limited Partnership Units

  	
   

  	
  1240609 Alberta Ltd.

  
	
   

  	
   

  	
  C-2-003

  	
   

  	
  11,360,000

  	
   

  	
  Class C
  Series 2 Limited Partnership Units

  	
   

  	
  Bullseye Boring Ltd.

  
	
   

  	
   

  	
  C-3-002

  	
   

  	
  8,422,672

  	
   

  	
  Class C
  Series 3 Limited Partnership Units

  	
   

  	
  Rodrigue’s Directional
  Drilling Projects Inc.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Cat Tech Canada Ltd.

  	
   

  	
  1

  	
   

  	
  100

  	
   

  	
  Common Shares

  	
   

  	
  Eveready Holdings
  Limited Partnership

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Cat Tech Operating Limited
  Partnership

  	
   

  	
  A-1

  	
   

  	
  1

  	
   

  	
  Class A Limited
  Partnership Units

  	
   

  	
  Eveready Holdings
  Limited Partnership

  
	
   

  	
   

  	
  A-2

  	
   

  	
  650,000

  	
   

  	
  Class A Limited
  Partnership Units

  	
   

  	
  Eveready Holdings Limited
  Partnership

  
	
   

  	
   

  	
  B-1

  	
   

  	
  15,315,912

  	
   

  	
  Class B Limited
  Partnership Units

  	
   

  	
  Cat Tech Canada Ltd.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1202867 Alberta Ltd.

  	
   

  	
  1

  	
   

  	
  100

  	
   

  	
  Common Shares

  	
   

  	
  Eveready Holdings
  Limited Partnership

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Acquisition Limited Partnership

  	
   

  	
  1

  	
   

  	
  1

  	
   

  	
  Class A Limited Partnership
  Units

  	
   

  	
  Eveready Holdings
  Limited Partnership

  
	
   

  	
   

  	
  2

  	
   

  	
  1,241,287

  	
   

  	
  Class A Limited
  Partnership Units

  	
   

  	
  Eveready Holdings
  Limited Partnership

  
	
   

  	
   

  	
  3

  	
   

  	
  736,772

  	
   

  	
  Class A Limited
  Partnership Units

  	
   

  	
  Eveready Holdings
  Limited Partnership

  
	
   

  	
   

  	
  4

  	
   

  	
  1,085,046

  	
   

  	
  Class A Limited
  Partnership Units

  	
   

  	
  Eveready Holdings
  Limited Partnership

  
	
   

  	
   

  	
  5

  	
   

  	
  24,153

  	
   

  	
  Class A Limited
  Partnership Units

  	
   

  	
  Eveready Holdings
  Limited Partnership

  
	
   

  	
   

  	
  6

  	
   

  	
  24,153

  	
   

  	
  Class A Limited
  Partnership Units

  	
   

  	
  Eveready Holdings
  Limited Partnership

  
	
   

  	
   

  	
  7

  	
   

  	
  21,705

  	
   

  	
  Class A Limited
  Partnership Units

  	
   

  	
  Eveready Holdings
  Limited Partnership

  
	
   

  	
   

  	
  8

  	
   

  	
  21,705

  	
   

  	
  Class A Limited
  Partnership Units

  	
   

  	
  Eveready Holdings
  Limited Partnership

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  C-1-001

  	
   

  	
  1,641,455

  	
   

  	
  Class C Limited
  Partnership Units

  	
   

  	
  Eveready Holdings
  Limited Partnership

  
	
   

  	
   

  	
  C-2-014

  	
   

  	
  663,096

  	
   

  	
  Class C Limited
  Partnership Units

  	
   

  	
  Eveready Holdings
  Limited Partnership

  
	
   

  	
   

  	
  C-3-013

  	
   

  	
  421,254

  	
   

  	
  Class C Limited
  Partnership Units

  	
   

  	
  Eveready Holdings
  Limited Partnership

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1225979 Alberta Ltd.

  	
   

  	
  1

  	
   

  	
  100

  	
   

  	
  Common Shares

  	
   

  	
  Eveready Holdings
  Limited Partnership

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Eveready Holdings (USA) Inc.

  	
   

  	
  3

  	
   

  	
  100

  	
   

  	
  Common Shares

  	
   

  	
  Eveready Operating
  Limited Partnership

  
	
   

  	
   

  	
  4

  	
   

  	
  1

  	
   

  	
  Common Shares

  	
   

  	
  Eveready Operating
  Limited Partnership

  
	
   

  	
   

  	
  5

  	
   

  	
  1,000

  	
   

  	
  Common Shares

  	
   

  	
  Eveready Operating
  Limited Partnership

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Mobile Industrial Health
  Services Ltd.

  	
   

  	
  A-9

  	
   

  	
  50

  	
   

  	
  Class A Common Shares

  	
   

  	
  Eveready Operating
  Limited Partnership

  



 

















 


	
   

  	
   

  	
  F-6

  	
   

  	
  50

  	
   

  	
  Class F Common
  Shares

  	
   

  	
  Eveready Operating
  Limited Partnership

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Eveready Industrial Western
  Ltd.

  	
   

  	
  3A

  	
   

  	
  100

  	
   

  	
  Class A Common
  Shares

  	
   

  	
  Eveready Operating
  Limited Partnership

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Tri-vax Enterprises Ltd.

  	
   

  	
  8

  	
   

  	
  200

  	
   

  	
  Class A Common
  Shares

  	
   

  	
  Eveready Operating
  Limited Partnership

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Eveready Energy Services Inc.

  	
   

  	
  4

  	
   

  	
  100

  	
   

  	
  Common Shares

  	
   

  	
  Eveready Holdings (USA)
  Inc.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Safety Watch, LLC

  	
   

  	
  1

  	
   

  	
  100%

  	
   

  	
  Membership Interest

  	
   

  	
  Eveready Holdings (USA)
  Inc.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Cat Tech, LLC

  	
   

  	
  1

  	
   

  	
  100%

  	
   

  	
  Membership Interest

  	
   

  	
  Eveready Holdings (USA)
  Inc.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1257427 Alberta Ltd.

  	
   

  	
  1

  	
   

  	
  100

  	
   

  	
  Class A Common
  Shares

  	
   

  	
  Eveready Holdings
  Limited Partnership.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1206894 Alberta Ltd.

  	
   

  	
  1

  	
   

  	
  100

  	
   

  	
  Common Shares

  	
   

  	
  Eveready Holdings
  Limited Partnership.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1240609 Alberta Ltd.

  	
   

  	
  1

  	
   

  	
  100

  	
   

  	
  Common Shares

  	
   

  	
  Eveready Holdings
  Limited Partnership.

  
	
   

  	
   

  	
  2

  	
   

  	
  14,185,402

  	
   

  	
  Common Shares

  	
   

  	
  Acquisition Limited
  Partnership

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1233460 Alberta Ltd.

  	
   

  	
  1

  	
   

  	
  100

  	
   

  	
  Class A Common

  	
   

  	
  Eveready Holdings
  Limited Partnership.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Astec Safety Services Ltd.

  	
   

  	
  E1

  	
   

  	
  100

  	
   

  	
  Class E Common
  Shares

  	
   

  	
  Eveready Energy
  Services Corp.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Bullseye Boring Ltd.

  	
   

  	
  1

  	
   

  	
  100

  	
   

  	
  Class A Common
  Shares

  	
   

  	
  Eveready Holdings
  Limited Partnership.

  
	
   

  	
   

  	
  2

  	
   

  	
  5,430,000

  	
   

  	
  Class A Common
  Shares

  	
   

  	
  Acquisition Limited
  Partnership

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Diversified Pressure Services Inc.

  	
   

  	
  1

  	
   

  	
  100

  	
   

  	
  Class A Common
  Shares

  	
   

  	
  Eveready Holdings Limited
  Partnership.

  
	
   

  	
   

  	
  2

  	
   

  	
  2,551,572

  	
   

  	
  Class A Common
  Shares

  	
   

  	
  Acquisition Limited
  Partnership

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Airborne Imaging Inc.

  	
   

  	
  1

  	
   

  	
  100

  	
   

  	
  Common Shares

  	
   

  	
  Eveready Holdings
  Limited Partnership

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Great Lakes Carbon
  Treatment, Inc.

  	
   

  	
  7

  	
   

  	
  50,000

  	
   

  	
  Common Shares

  	
   

  	
  Eveready Holdings (USA)
  Inc.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Breathing Systems
  International, LLC

  	
   

  	
  1

  	
   

  	
  100%

  	
   

  	
  Membership Interest

  	
   

  	
  Eveready Holdings (USA)
  Inc.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Rodrigue’s Directional Drilling
  Projects Inc.

  	
   

  	
  1

  	
   

  	
  100

  	
   

  	
  Class A Common
  Shares

  	
   

  	
  Eveready Holdings
  Limited Partnership.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  River Valley Energy Services
  Inc.

  	
   

  	
  1

  	
   

  	
  10

  	
   

  	
  Common Shares

  	
   

  	
  Eveready Holdings (USA)
  Inc.

  



 

















 


	
  Denman Industrial Operating
  Limited Partnership

  	
   

  	
  1

  	
   

  	
  1

  	
   

  	
  Limited Partnership
  Unit

  	
   

  	
  Eveready Holdings
  Limited Partnership

  
	
   

  	
   

  	
  B-1-002

  	
   

  	
  1,000,000

  	
   

  	
  Class B
  Series 1 Limited Partnership Units

  	
   

  	
  Denman Industrial
  Trailers Ltd.

  
	
  Denman Industrial Trailers Ltd.

  	
   

  	
  1

  	
   

  	
  100

  	
   

  	
  Class A Common
  Shares

  	
   

  	
  Eveready Holdings
  Limited Partnership

  



 
















 


Disclosure Schedule 4.10


 


EVEREADY ENERGY SERVICES CORP.


 


Tax Matters


 


Certain
information has been intentionally deleted from the SEDAR version of this
Agreement in accordance with section 12.2(3) of National Instrument 51-102. The
disclosure of this information to the general public would be seriously
prejudicial to the interests of Eveready Inc. or would violate confidentiality
provisions. Such information is not essential in order to understand the
material terms of this Agreement.


 

















 


Disclosure Schedule 4.11


 


EVEREADY ENERGY SERVICES CORP.


 


Litigation


 


Certain
information has been intentionally deleted from the SEDAR version of this
Agreement in accordance with section 12.2(3) of National Instrument 51-102. The
disclosure of this information to the general public would be seriously
prejudicial to the interests of Eveready Inc. or would violate confidentiality
provisions. Such information is not essential in order to understand the
material terms of this Agreement.


 

















 


Disclosure
Schedule 4.12


 


EVEREADY
ENERGY SERVICES CORP.


 


Pension
and Benefit Plans


 


(see attached)


 


Certain information has been
intentionally deleted from the SEDAR version of this Agreement in accordance
with section 12.2(3) of National Instrument 51-102. The disclosure of this
information to the general public would be seriously prejudicial to the
interests of Eveready Inc. or would violate confidentiality provisions. Such
information is not essential in order to understand the material terms of this
Agreement.


 

















 


Eveready Income
Fund


Health Insurance
Coverage


 


	
   

  	
   

  	
  Insurance

  	
   

  	
   

  	
   

  	
   

  
	
  Eveready Division

  	
   

  	
  Company

  	
   

  	
  Policy
  Name

  	
   

  	
  Policy #

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Eveready Canadian
  divisions (except Cat-Tech Canada)

  	
   

  	
  Great West Life

  	
   

  	
  Eveready Income Fund

  	
   

  	
  [Deleted]

  
	
  Eveready Industrial
  Services Corp. - ICE US division

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Hospitalization

  	
   

  	
  Aetna (could be
  changing for Jan)

  	
   

  	
  Eveready Industrial
  Services Inc

  	
   

  	
  [Deleted]

  
	
  Vision

  	
   

  	
  Compbenefits

  	
   

  	
  Eveready Industrial
  Services Inc

  	
   

  	
  [Deleted]

  
	
  Dental,
  STD, LTD, Life

  	
   

  	
  Assurant Employee
  Benefits

  	
   

  	
  Eveready Industrial
  Services Inc

  	
   

  	
  [Deleted]

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  River Valley Energy
  Services

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Health
  & Dental

  	
   

  	
  Canwest Group Benefits

  	
   

  	
  River Valley Energy
  Services

  	
   

  	
  [Deleted]

  
	
  STD,
  LTD, Life

  	
   

  	
  Great West Life

  	
   

  	
  Eveready Income Fund

  	
   

  	
  [Deleted]

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Cat-Tech Canada

  	
   

  	
  Alberta Blue Cross

  	
   

  	
  Cat Tech Canada Company

  	
   

  	
  [Deleted]

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  [Deleted]

  
	
  Cat-Tech US

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Medical,
  Dental, Flexible Spending Account 

  	
   

  	
  Cigna HealthCare (could
  be changing in Jan)

  	
   

  	
  Cat Tech US

  	
   

  	
  [Deleted]

  
	
  Vision

  	
   

  	
  Cigna HealthCare

  	
   

  	
  Cat Tech US

  	
   

  	
  [Deleted]

  
	
  Life,
  STD, LTD

  	
   

  	
  Mutual of Omaha

  	
   

  	
  Cat Tech US

  	
   

  	
  [Deleted]

  
	
  Supplemental
  insurance (paid by employees)

  	
   

  	
  Worksite Solutions

  	
   

  	
  Cat Tech US

  	
   

  	
  [Deleted]

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Cat-Tech UK &
  Singapore

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Government
  coverage

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  



 

















 


Disclosure Schedule 4.13


 


EVEREADY ENERGY SERVICES CORP.


 


Brokers


 


Nil.


 

















 


Disclosure Schedule 4.14


 


EVEREADY ENERGY SERVICES CORP.


 


Intellectual Property


 


Certain
information has been intentionally deleted from the SEDAR version of this
Agreement in accordance with section 12.2(3) of National Instrument 51-102. The
disclosure of this information to the general public would be seriously
prejudicial to the interests of Eveready Inc. or would violate confidentiality
provisions. Such information is not essential in order to understand the
material terms of this Agreement.


 

















 


Disclosure Schedule 4.16


 


EVEREADY ENERGY SERVICES CORP.


 


Hazardous Materials


 


Nil.


 

















 


Disclosure Schedule 4.17


 


EVEREADY ENERGY SERVICES CORP.


 


Insurance


 


Certain
information has been intentionally deleted from the SEDAR version of this Agreement
in accordance with section 12.2(3) of National Instrument 51-102. The
disclosure of this information to the general public would be seriously
prejudicial to the interests of Eveready Inc. or would violate confidentiality
provisions. Such information is not essential in order to understand the
material terms of this Agreement.


 

















 


Disclosure Schedule 4.18


 


EVEREADY ENERGY SERVICES CORP.


 


Deposit and Disbursement Accounts


 


Certain
information has been intentionally deleted from the SEDAR version of this
Agreement in accordance with section 12.2(3) of National Instrument 51-102. The
disclosure of this information to the general public would be seriously
prejudicial to the interests of Eveready Inc. or would violate confidentiality
provisions. Such information is not essential in order to understand the
material terms of this Agreement.


 
















 


Disclosure Schedule 4.19


 


EVEREADY ENERGY SERVICES CORP.


 


Government Contracts


 


Nil.


 

















 


Disclosure Schedule 4.21


 


EVEREADY ENERGY SERVICES CORP.


 


Bonds; patent, Trademark, Industrial Design Licenses


 


Certain
information has been intentionally deleted from the SEDAR version of this
Agreement in accordance with section 12.2(3) of National Instrument
51-102. The disclosure of this information to the general public would be
seriously prejudicial to the interests of Eveready Inc. or would violate
confidentiality provisions. Such information is not essential in order to
understand the material terms of this Agreement.


 

















 


Disclosure Schedule 6.1


 


Trade Names


 


(see attached)


 

















 


	
  

  	
   

  	
  Airborne
  Imaging

  
	
   

  	
   

  	
   

  
	
  

  	
   

  	
  Astec
  Safety Services

  
	
   

  	
   

  	
   

  
	
  

  	
   

  	
  Cat
  Tech

  
	
   

  	
   

  	
   

  
	
  

  	
   

  	
  Denman
  Industrial Trailer

  
	
   

  	
   

  	
   

  
	
  

  	
   

  	
  Eveready
  Directional Boring

  
	
   

  	
   

  	
   

  
	
  

  	
   

  	
  Eveready
  Energy Services

  
	
   

  	
   

  	
   

  
	
  

  	
   

  	
  Great
  Lakes Carbon Treatment

  
	
   

  	
   

  	
   

  
	
  

  	
   

  	
  JL
  Filtration

  
	
   

  	
   

  	
   

  
	
  

  	
   

  	
  Mercedes
  Surveys

  
	
   

  	
   

  	
   

  
	
  

  	
   

  	
  Mobile
  Industrial Health Services

  
	
   

  	
   

  	
   

  
	
  

  	
   

  	
  Pembina
  Area Landfill

  
	
   

  	
   

  	
   

  
	
  

  	
   

  	
  River
  Valley Energy Services

  
	
   

  	
   

  	
   

  
	
  

  	
   

  	
  Safety
  Watch

  
	
   

  	
   

  	
   

  
	
  

  	
   

  	
  Trivax

  



 

















 


Disclosure Schedule 7.4


 


EVEREADY ENERGY SERVICES CORP.


 


Indebtedness


 


1)                                      The operating
leases and capital leases of the Credit Parties (See Attached list for summary
current to September 30, 2008);


2)                                      Current and
Future Taxes Payable;


3)                                      Unitholder
Distributions;


4)                                      Asset
Retirement Obligations;


5)                                      Convertible
Debentures- Debt Feature;


6)                                      Minority
Interests.


 


Certain
information has been intentionally deleted from the SEDAR version of this Agreement
in accordance with section 12.2(3) of National Instrument 51-102. The
disclosure of this information to the general public would be seriously
prejudicial to the interests of Eveready Inc. or would violate confidentiality
provisions. Such information is not essential in order to understand the
material terms of this Agreement.


 

















 


Disclosure Schedule 7.5(a)


 


EVEREADY ENERGY SERVICES CORP.


 


Transactions with Affiliates


 


Except
as listed below, there are no transactions with Affiliates other than the existing
loans and advances incurred in the ordinary course of business:


 


a)              During the three and nine
months ended September 30, 2008, Eveready incurred professional fees of
$67 and $227 (2007 - $22 and $409), respectively, from a partnership of which
an Eveready officer is a partner;


 


b)             During the
three and nine months ended September 30, 2008, Eveready incurred professional
fees of $44 and $160 (2007 - $23 and $92), respectively, from a partnership of
which an Eveready trustee is a partner;


 


c)              Included in general and
administrative expenses for the three and nine months ended September 30,
2008 are occupancy costs of $711 and $1,616 (2007 - $411 and $1,145),
respectively, paid to companies controlled or influenced by certain officers
and/or trustees of Eveready;


 


d)             During the three and nine
months ended September 30, 2008, Eveready incurred equipment rental and
repair costs of $218 and $343 (2007 - $16 and $121), respectively, from
companies controlled or influenced by certain officers and/or trustees of Eveready;


 


e)              During the three and nine
months ended September 30, 2008, Eveready acquired service equipment of
$nil and $1,745 (2007 - $1,424 and $2,496), respectively, from companies
controlled or influenced by certain officers and/or trustees of Eveready;


 


f)                During the three and nine
months ended September 30, 2008, Eveready earned service revenue of $1,357
and $2,577 (2007 - $888 and $888), respectively, from companies controlled or
influenced by certain officers and/or trustees of Eveready; and


 


g)             During the nine months ended
September 30, 2008, Eveready disposed of property, plant and equipment for
proceeds of $233 (2007 - $nil), to a company influenced by an Eveready trustee.


 


As
at September 30, 2008, outstanding amounts collectible from or owing to
related parties included accounts receivable of $2,321 (December 31, 2007
- $2,004) and accounts payable and accrued liabilities of $373 (December 31,
2007 - $108). Except for item ‘g’ above, all transactions occurred in the
normal course of operations and were measured at their exchange amounts, which
were established and agreed to as


 

















 


consideration
by the related parties. The proceeds received on disposal of property, plant
and equipment were measured at the disposed asset’s
carrying amount, which also equalled its exchange amount.


 

















 


Disclosure Schedule 7.5(b)


 


EVEREADY ENERGY SERVICES CORP.


 


Transactions with Employees


 


Nil.


 

















 


Disclosure Schedule 7.7


 


EVEREADY ENERGY SERVICES CORP.


 


Guaranteed Indebtedness


 


(see attached)


 


a)              The Fund has provided
certain guarantees to financial institutions regarding financing that they have
provided to certain contractors. The loans were provided for the purchase of
specific service and automotive equipment used by the contractors in providing
services to the Fund. The loans are collateralized by the specific equipment.
The total balance of the loans guaranteed by the Fund as at September 30,
2008 was $1,577,000. See Attached.


 


b)             As at September 30,
2008 the Fund had issued letters of credit up to a maximum amount of CDN
$2,225,226. The letters of credit are drawn on the same credit facility as the
Fund’s bank indebtedness.


 


c)              Matching Units held within
our Employee Unit Plan Trust have been provided as collateral against bank
loans owing by certain employees that were issued in connection with their
participation in the Employee Unit Plan. These units could be drawn upon by the
bank if a participant were to default on the debt obligation and the
participant’s units were not sufficient to cover the outstanding loan balance.
At of September 30, 2008, the Employee Unit Plan Trust held 1.4 million
units with a fair value of $3.2 million as collateral over such bank loans;


 


d)             In the normal course of
business, the Fund enters into agreements that include indemnities in favour of
third parties. These include engagement letters with advisors and consultants,
and service agreements. The Fund has also agreed to indemnify its trustees,
directors, officers, and employees in accordance with the Fund’s constating
documents and bylaws. Certain agreements do not contain any limits on the Fund’s
liability and therefore it is not possible to estimate the Fund’s potential
liability under these indemnities. In certain cases, the Fund has recourse
against third parties with respect to these indemnities. In addition, the Fund
maintains insurance policies that may provide coverage against certain claims
under these indemnities.


 


Certain
information has been intentionally deleted from the SEDAR version of this
Agreement in accordance with section 12.2(3) of National Instrument 51-102.
The disclosure of this information to the general public would be seriously
prejudicial to the interests of Eveready Inc. or would violate confidentiality
provisions. Such information is not essential in order to understand the
material terms of this Agreement.


 

















 


Disclosure Schedule 7.8


 


EVEREADY ENERGY SERVICES CORP.


 


Existing Liens


 


1.                             ALBERTA


 


(a)                                  Eveready
Inc. - NIL


 


(b)                                 Borrower
(“Eveready Energy Services Corp.” formerly “Eveready Industrial Services Corp.”
All registrations in this section are registered against Eveready Industrial
Services Corp.)


 


(i)                                   GE Canada Asset
Financing Holding Company (Note: Alberta PPR Registration # 07042335138, 07042335179,
07042335211, 07042335286, 07042335344, 07042335450, 07042335526, 07042335641, 07042335724,
07042335799, 07042335898, 07042335948, 07042336045, 07042336102, 07042336177, 07042336235,
07042336326, 07042336417, 07042336466, 07042336557, 07042336672, 07042336748,
07042336789, 07042336839, 07042334883, 07042336904, 07042334800, 07042334750)


 


(ii)                                  BRANDT TRACTOR
LTD. (Note: Garage Keeper’s Lien of $2,415.07 as Alberta PPR Registration
#08121916501)


 


(iii)                             GLOVER
INTERNATIONAL TRUCKS LTD. (Note: Garage Keeper’s Lien of $3,510.33 as  Alberta PPR
Registration #08111322119)


 


(iv)                            GREAT WEST
KENWORTH LTD. (Note: Garage Keeper’s Lien of $3,184.03 as Alberta PPR
Registration # 08111101361)


 


(v)                               WESTERN
STERLING TRUCKS LTD. (Note: Garage Keeper’s Lien of $1,267.33 as Alberta PPR
Registration #  08111005953)


 


(vi)                            FORT GARRY INDUSTRIES
LTD. (Note: Alberta PPR Registration #08070213496)


 


(vii)                         WESTERN
STERLING TRUCKS LTD. (Note: Garage Keeper’s Lien of $2,026.69 as Alberta PPR
Registration # 08062533510)


 


(viii)                      WILLIAMS
SCOTSMAN OF CANADA, INC. (Note: Alberta PPR Registration #08012920955)


 


(ix)                              Dell Financial
Services Canada Limited. (Note: Alberta PPR Registration #05080535890,
Saskatchewan PPR Registration #300103782)


 

















 


(x)                                 Edmonton
Kenworth Ltd. (Note: Alberta PPR Registration  #04012332021, 04012332807, 04012332922,
04032931992, 04032932107, 05012412549)


 


(xi)                              First Truck
Centre (Note: Garage Keeper’s Lien of $2,695.13 as Alberta PPR Registration
#08102042314)


 


(xii)                           Inland Kenworth
(Note: Garage Keeper’s Lien of $1,954.87 as Alberta PPR Registration # 08080823231,
British Columbia PPR Registration #509993D)


 


(xiii)                        Shaw GMC
Pontiac Buick Hummer Ltd. (Note: Alberta PPR Registration #06121909607)


 


(xiv)                       Transportaction
Lease Systems Inc. (Note: Alberta PPR Registration #02091202966)


 


(c)                                  Eveready
Income Fund


 


(i)                                   GE Canada Asset
Financing Holding Company (Note: Alberta PPR Registration #07042334750)


 


(ii)                                Transportaction
Lease Systems Inc. (Note: Alberta PPR Registration #02091202966, 05053025317)


 


(iii)                             HSBC Bank
Canada (Note: Alberta PPR Registration #05080809097, 07080205102)


 


(d)                                 Eveready
Income Trust


 


(i)                                   GE Canada Asset
Financing Holding Company (Note: Alberta PPR  Registration #07042334800,
07042334750)


 


(e)                                  Eveready
Holdings Limited Partnership 


 


(i)                                   GE Canada Asset
Financing Holding Company (Note: Alberta PPR  Registration #07042334800,
07042334750)


 


(f)                                    Eveready
Holdings GP Ltd.


 


(i)                                   GE Canada Asset
Financing Holding Company (Note: Alberta PPR  Registration #07042334750)


 


(g)                                 River
Valley Operating Limited Partnership


 


(i)                                   GE Canada Asset
Financing Holding Company (Note: Alberta PPR  Registration #07042336961,
07042337001, 07042337068, 07042337555, 07042337118, 07042337191, 07042337241,
07042337308, 07042337357, 07042337399, 07042337431, 07042337514, 07042334800,
07042334750)


 


















 


(h)           River
Valley Energy Services Ltd.


 


(i)            GE Canada Asset Financing Holding Company (Note:
Alberta PPR Registration #07042336961, 07042337001, 07042337068, 07042337555,
07042337118, 07042337191, 07042337241, 07042337308, 07042337357, 07042337399,
07042337431, 07042337514, 07042338538, 07042334800, 07042334750)


 


(ii)           Finning International Inc. (Note: Alberta
PPR Registration #08072306227, 08073124700)


 


(iii)          Paccar Financial Services Ltd., Paccar Financial
Ltd. (Note: Alberta PPR Registration #04083026734)


 


(iv)          Transportaction Lease Systems Inc. (Note: Alberta
PPR Registration #02091202966)


 


(v)           Union Tractor Limited (Note: Garage Keeper’s Lien
of $11,686.33 as Alberta PPR Registration #08120419588, 08120420215)


 


(i)            Winterhawk
Operating Limited Partnership


 


(i)            GE Canada Asset Financing Holding Company (Note:
Alberta PPR Registration #07042337613, 07042337670, 07042337738, 07042337969,
07042338033, 07042338181, 07042338124, 07042334883, 07042334800, 07042334750)


 


(j)            Winterhawk
Enterprises (Provost) Ltd.


 


(i)            GE Canada Asset Financing
Holding Company (Note: Alberta PPR Registration #07042337613, 07042337670,
07042337738, 07042337969, 07042338033, 07042338181, 07042338124, 07042334883,
07042334800, 07042334750)


 


(ii)           BMO Bank of Montreal (Note: Land
Charge as Alberta PPR Registration #05032333535)


 


(iii)          Transportaction Lease Systems
Inc. (Note: Alberta PPR Registration #02091202966)


 


(k)           Eveready
Operating Limited Partnership


 


(i)            GE Canada Asset Financing
Holding Company (Note: Alberta PPR Registration #07042335138, 07042335179, 07042335211,
07042335286, 07042335344, 07042335450, 07042335526, 07042335641, 07042335724, 07042335799,
07042335898, 07042335948, 07042336045, 07042336102, 07042336177, 07042336235, 07042336326,
07042336417, 07042336466,


 

















 


07042336557, 07042336672, 07042336748, 07042336789, 07042336839,  07042334883,
07042336904, 07042334800, 07042334750)


 


(l)            JL Filtration Operating Limited Partnership


 


(i)            GE Canada Asset Financing
Holding Company (Note: Alberta PPR Registration #07042338231, 07042334800,
07042334750)


 


(m)          JL Filtration Inc.


 


(i)            GE Canada Asset Financing
Holding Company (Note: Alberta PPR Registration #07042338231, 07042334800,
07042334750)


 


(ii)           Transportaction Lease Systems Inc. (Note:
Alberta PPR Registration #02091202966)


 


(iii)          Registered under the debtor name, “JL Filtration
Ltd.” (Note: Alberta PPR Registration #05092732469)


 


(n)           Eveready
Industrial Western Ltd.


 


(i)            GE Canada Asset Financing
Holding Company (Note: Alberta PPR Registration #07042338298, 07042334800,
07042334750)


 


(o)           Mobile
Industrial Health Services Ltd.


 


(i)            GE Canada Asset Financing
Holding Company (Note: Alberta PPR Registration #07042338348, 07042334800,
07042334750)


 


(ii)           Transportaction Lease
Systems Inc. (Note: Alberta PPR Registration #02091202966)


 


(p)           Tri-Vax
Enterprises Ltd.


 


GE Canada Asset Financing Holding Company (Note: Alberta PPR
Registration #07042338413, 07042334800, 07042334750)


 


(q)           Acquisition
Limited Partnership


 


(i)            GE Canada Asset Financing
Holding Company (Note: Alberta PPR Registration #07042334750)


 


(r)            Canada-Wide
Oilfield Services Ltd.


 


(i)            GE Canada Asset Financing
Holding Company (Note: Alberta PPR Registration #07042334750, 07042338462)


 

















 


(s)           Canada-Wide
Operating Limited Partnership


 


(i)            GE Canada Asset Financing
Holding Company (Note: Alberta PPR Registration #07042334750)


 


(ii)           BMO Bank of Montreal (Note: Land
Charge - Alberta PPR Registration #06011810451)


 


(t)            Eveready Directional Boring Ltd.


 


(i)            GE Canada Asset Financing
Holding Company (Note: Alberta PPR Registration #07042334750)


 


(ii)           Brandt Tractor Ltd. (Note: Garage
Keeper’s Lien in the amount of $1,525.05 as Alberta PPR Registration
#08102234524)


 


(u)           1225979 Alberta Ltd.


 


(i)            GE Canada Asset Financing
Holding Company (Note: Alberta PPR Registration #07042334750)


 


(v)           1202867 Alberta Ltd.


 


(i)            GE Canada Asset Financing
Holding Company (Note: Alberta PPR Registration #07042334750)


 


(w)          1240609 Alberta Ltd.


 


(i)            GE Canada Asset Financing
Holding Company (Note: Alberta PPR Registration #07042334750)


 


(x)            1206894 Alberta Ltd.


 


(i)            GE Canada Asset Financing
Holding Company (Note: Alberta PPR Registration #07042334750)


 


(y)           1233460 Alberta Ltd.


 


(i)            GE Canada Asset Financing
Holding Company (Note: Alberta PPR Registration #07042334750)


 


(z)            Eveready Directional Boring LP


 


(i)            GE Canada Asset Financing
Holding Company (Note: Alberta PPR Registration #07042334750)


 


(aa)         Astec Safety Services Ltd.


 


(i)            GE Canada Asset
Financing Holding Company (Note: Alberta PPR Registration #07042334750)


 

















 


(ii)           CIT Financial Ltd. (Note: Alberta PPR
Registration #06060221741)


 


(iii)          Kralon Holdings Ltd.;
Heritage Inn (Note: Alberta PPR Registration #07102633505. Writ
of Enforcement in current amount of $1,783.46)


 


(bb)         1257427 Alberta Ltd.


 


(i)            GE Canada Asset Financing
Holding Company (Note: Alberta PPR Registration #07042334750)


 


(cc)         Cat Tech Operating Limited
Partnership


 


(i)            GE Canada Asset Financing
Holding Company (Note: Alberta PPR Registration #07042334750)


 


(dd)         Diversified Pressure Services
Ltd.


 


(i)            GE Canada Asset Financing
Holding Company (Note: Alberta PPR Registration #07042334750)


 


(ee)         Cat Tech Canada Ltd.


 


(i)            GE Canada Asset Financing
Holding Company (Note: Alberta PPR Registration #07042334750)


 


(ff)           Bullseye Boring Ltd.


 


(i)            GE Canada Asset Financing
Holding Company (Note: Alberta PPR Registration #07042334750)


 


(gg)         Airborne Imaging Inc.


 


(i)            GE Canada Asset Financing
Holding Company (Note: Alberta PPR Registration #07042334750)


 


(hh)         Rodrigue’s Directional Drilling
Projects Inc.


 


(i)            GE Canada Asset Financing
Holding Company (Note: Alberta PPR Registration #07042334750)


 


(ii)           BMO Bank of Montreal (Note: Land
Charge -Alberta PPR Registration #07030720291; Alberta PPR Registration
#07030720242)


 


(iii)          Transportaction Lease
Systems Inc. (Note: Alberta PPR Registration #05072027856)


 

















 


(ii)           Eveready Energy Services Inc.
(formerly “Eveready Industrial Services Inc.”)


 


(i)            GE Canada Asset Financing
Holding Company (Note: Alberta PPR Registration #07042334750)


 


(ii)           Registered under the debtor
name, “Eveready Energy Services” (Note: Garage Keeper’s Lien Alberta PPR
Registration #08120135125)


 


(iii)          Registered under the debtor
name, “Eveready Industrial Services Inc.”, and creditor name BMO Bank of
Montreal (Note: ALLPAAP as Alberta PPR Registration #07030720242)


 


(iv)          Registered under the debtor
name, “Eveready Industrial Services Inc.”, and creditor name BMO Bank of
Montreal (Note: Land Charge as Alberta PPR Registration #07030720291)


 


(jj)           Eveready Holdings (USA) Inc.


 


(i)            GE Canada Asset Financing
Holding Company (Note: Alberta PPR Registration #07042334750)


 


(kk)         Safety Watch, LLC


 


(i)            GE Canada Asset Financing
Holding Company (Note: Alberta PPR Registration #07042334750)


 


(ll)           Cat-Tech LLC


 


(i)            GE Canada Asset Financing
Holding Company (Note: Alberta PPR Registration #07042334750)


 


(mm)       Breathing Systems International,
LLC


 


(i)            GE Canada Asset Financing
Holding Company (Note: Alberta PPR Registration #07042334750)


 


(nn)         Great Lakes Carbon Treatment, Inc.


 


(i)            GE Canada Asset Financing
Holding Company (Note: Alberta PPR Registration #07042334750)


 


(oo)         River Valley Energy Services Inc.


 


(i)            GE Canada Asset Financing
Holding Company (Note: Alberta PPR Registration #07042334750)


 


(pp)         Denman Industrial Trailers Ltd.


 


(i)            GE Canada Asset Financing
Holding Company (Note: Alberta PPR Registration #07042334750)


 

















 


(ii)           HSBC Bank Canada (Note:
Alberta PPR Registration #05080809063, 05080809097, 05111443197, 05111600739,
06022724311, 06022724352, 06050420634, 06050421111, 06091416716, 06091502820,
07020825761, 07020825886, 07020913252, 07020913260, 07041201802, 07041201810,
07121228234, 07121228243, 08010935261, 08030613438, 08030627017, 08091204592,
08091514736)


 


(iii)          Komatsu International
(Canada) Inc. (Note: Alberta PPR Registration #08092514920, 08092515226,
08092515377, 08092515833)


 


(iv)          Alta-Fab Structures Ltd.
(Note: Alberta PPR Registration # 08091527344, 08100231424, 08100234862,
08100711428, 08100711632, 08100711719, 08100711875, 08100712192, 08100714139,
08100714989, 08100715471, 08100715857, 08100716729, 08100718237, 08100718574,
08100719318, 08100724540)


 


(v)           De Lage Landen Financial
Services Canada Inc. (Note: Alberta PPR Registration #08103132225, 08111032398)


 


(vi)          De Lage Landen Financial
Services Canada (CAD) (Note: Alberta PPR Registration #08111331033)


 


(vii)         Registered under the debtor
name, “Denman Industrial Trailer Ltd.” (Note: Alberta PPR Registration
#08100715161)


 


(viii)        Registered under the debtor
name, “Denman Industrial Trailers” (Note: Alberta PPR Registration #
08061312702, 08091834477)


 


(qq)         Denman Industrial Operating Limited Partnership


 


(i)            HSBC Bank of Canada (Note:
Alberta PPR Registration #05080809063, 05080809097, 05111443197, 05111600739,
06022724311, 06022724352, 06050420634, 06050421111, 06091416716, 06091502820,
07020825761, 07020825886, 07020913252, 07020913260, 07041201802, 07041201810,
07121228234, 07121228243, 08010935261, 08030613438, 08030627017, 08091204592,
0809120459)


 


(ii)           GE Canada Asset Financing
Holding Company (Note: Alberta PPR Registration #07042334750)


 


2.             ONTARIO


 


(a)           Eveready
Energy Services Corp.


 


(i)            GE Canada Equipment
Financing G.P. (Note: Ontario PPR File #619284447 includes other Credit Parties
as additional debtors)


 

















 


(b)           Eveready
Operating Limited Partnership


 


(i)            GE Canada Equipment
Financing G.P. (Note: Ontario PPR File #619284447 includes other Credit Parties
as additional debtors)


 


(ii)           GE Canada Equipment
Financing G.P. (Note: Ontario PPR File #613697409 includes other Credit Parties
as additional debtors)


 


(c)           Cat Tech Operating Limited
Partnership


 


(i)            GE Canada Equipment
Financing G.P. (Note: Ontario PPR File #619284447 includes other Credit Parties
as  additional
debtors)


 


(d)           Cat Tech Canada Ltd.


 


(i)            GE Canada Equipment
Financing G.P. (Note: Ontario PPR File #619284447 includes other Credit Parties
as additional debtors)


 


(ii)           Citicorp Vendor Finance,
Ltd. — (Note: Ontario File #604427463 secures a registration against  a
2004 Caterpillar GP40, VIN AT13F00180)


 


(e)           Eveready Industrial Services
Corp.


 


(i)            GE Canada Equipment
Financing G.P. (Note: Ontario PPR File #619284447 includes other Credit Parties
as additional debtors)


 


(ii)           GE Canada Equipment
Financing G.P. (Note: Ontario PPR File #613697409 includes other Credit Parties
as additional debtors)


 


3.           SASKATCHEWAN


 


(a)           Eveready Energy  Services Corp.


 


(i)            GE Canada Asset Financing
Holding Company (Note: Saskatchewan PPR Registration #122611454)


 


(b)           Winterhawk Operating Limited
Partnership


 


(i)            GE Canada Asset Financing
Holding Company (Note: Saskatchewan PPR Registration #121873079)


 


(ii)           GE Canada Asset Financing Holding
Company (Note: Saskatchewan PPR Registration #122611454)


 


(c)           Winterhawk Enterprises (Provost)
Ltd.


 


(i)            GE Equipment Financing G.P.
(Note: Saskatchewan PPR Registration 
#120134278)


 

















 


(ii)           Common Wealth Credit Union
Limited Note: Saskatchewan PPR Registration #121562521 registering an interest
in the following:


 


2004
Kenworth T800B


2004
Ford F150


2004
Ford F150


 


(d)           Eveready Operating Limited
Partnership


 


(i)            GE Canada Asset Financing Holding Company (Note: Saskatchewan PPR
Registration #121873079)


 


(ii)           GE Canada Asset Financing
Holding Company (Note: Saskatchewan PPR Registration #122611454)


 


(e)           Diversified Pressure Services
Ltd.


 


(i)            GE Canada Asset Financing
Holding Company (Note: Saskatchewan PPR Registration #122611454)


 


(f)            Eveready Industrial Services
Corp.


 


(i)            GE Canada Asset Financing
Holding Company (Note: Saskatchewan PPR Registration #121873079)


 


(ii)           GE Canada Asset Financing
Holding Company (Note: Saskatchewan PPR Registration #122611454)


 


(iii)          Dell Financial Services
Canada Limited (Note: Saskatchewan PPR Registration #300103782 registering an
interest in all Dell and non-Dell computer equipment leased to the debtor by
the secured party)


 


(vi)          Warner Truck Industries Ltd.
(Note: Saskatchewan PPR Registration #300360391 registering a commercial lien
against a 2001 Freightliner N112064S)


 


4.             BRITISH COLUMBIA


 


(a)           Eveready Operating Limited
Partnership


 


(i)            GE Equipment Financing G.P.
(Note: BC PPR  Base Registration #259771C)


 


(ii)           GE Equipment Financing G.P.
(Note: BC PPR Base Registration #604567C)


 

















 


(b)           JL Filtration Operating Limited
Partnership


 


(i)            GE Equipment Financing G.P.
(Note: BC PPR Base Registration #259771C)


 


(ii)           GE Equipment Financing G.P.
(Note: BC PPR Base Registration #604567C)


 


(c)           JL Filtration Inc.


 


(i)            GE Equipment Financing G.P.
(Note: BC PPR Base Registration #259771C)


 


(ii)           GE Equipment Financing G.P.
(Note: BC PPR Base Registration 
#604567C)


 


(d)           Eveready Industrial Western Ltd.


 


(i)            GE Equipment Financing G.P.
(Note: BC PPR Base Registration  #259771C)


 


(ii)           GE Equipment Financing G.P.
(Note: BC PPR Base Registration 
#604567C)


 


(e)           Mobile Industrial Health Services
Ltd.


 


(i)            GE Equipment Financing G.P.
(Note: BC PPR Base Registration  #259771C)


 


(ii)           GE Equipment Financing G.P.
(Note: BC PPR Base Registration #604567C)


 


(f)            Eveready Industrial Services
Corp.


 


(i)            GE Equipment Financing G.P.
(Note: BC PPR Base Registration #259771C)


 


(ii)           GE Equipment Financing G.P.
(Note: BC PPR Base Registration #604567C)


 


(iii)          Inland Kenworth (Fort St.
John) (Note BC PPR Base Registration #524964E registering a lien against a 2004
Kenworth T800B in the amount of $1,954.87)


 


(vi)          James Western Star (Fort St.
John) (Note BC PPR Base Registration #648202E registering a lien against a 2006
Peterbilt 378 in the amount of $5,872.23)


 

















 


5.             MANITOBA


 


(a)           Eveready Operating Limited
Partnership


 


(i)            GE Canada Asset Financing
Holding Company (Note: Manitoba PPR Registration #200517563101)


 


(ii)           GE Canada Asset Financing
Holding Company (Note: Manitoba PPR Registration #200504923109)


 


(c)           Eveready Industrial Services
Corp.


 


(i)            GE Canada Asset Financing
Holding Company (Note: Manitoba PPR Registration #200517563101)


 


(ii)           GE Canada Asset Financing
Holding Company (Note: Manitoba PPR Registration #200504923109)


 


6.             USA


 


(a)           Eveready Energy Services, Inc.
(formerly “Eveready Industrial Services, Inc.”)


 


(i)            Nil


 


(b)           Eveready Industrial Services, Inc.


 


(i)            Nil.


 


(c)           Eveready Holdings (USA) Inc.


 


(i)            BMO Bank of Montreal —
Original Filing Number 2007002094-5


 


(ii)           GE Canada Asset Financing
Holding Company — Original Filing Number 2006041622-1.


 


(d)           Safety Watch  LLC


 


(i)            Bank of America, N.A. —
Original Filing Number 40074572838


 


(ii)           Bank of America, N.A. —
Original Filing Number 20003971688


 


(iii)          Bank of America, N.A. —
Original Filing Number 9900128892


 


(e)           Cat-Tech LLC


 


(i)            Dell Financial Services
L.L.C. — Original Filing Number 80025813263


 

















 


(ii)           Dell Financial Services
L.L.C. — Original Filing Number 80023180274


 


(iii)          Dell Financial Services
L.L.C. — Original Filing Number 80012952219


 


(iv)          Dell Financial Services
L.P.. — Original Filing Number 80009736063


 


(v)           Dell Financial Services L.P.
— Original Filing Number 80002874786


 


(vi)          Dell Financial Services L.P.
— Original Filing Number 80000609538


 


(vii)         Dell Financial Services L.P.
— Original Filing Number 70043824773


 


(viii)        Dell Financial Services L.P.
— Original Filing Number 70042575828


 


(ix)           Dell Financial Services L.P.
— Original Filing Number 70042575939


 


(x)            Dell Financial Services L.P.
— Original Filing Number 70041945868


 


(xi)           Dell Financial Services L.P.
— Original Filing Number 70031610634


 


(xii)          BMO Bank of Montreal —
Original Filing Number 70000788505


 


(xiii)         GE Canada Asset Financing
Holding Company — Original Filing Number 60041168218


 


(xiv)        Financial Federal Credit Inc.
— Original Filing Number 50034517116 (debtor is listed as Cat Tech Inc.)


 


(xv)         Financial Federal Credit
Inc. — Original Filing Number 50034517338 (debtor is listed as Cat Tech Inc.)


 


(xvi)        Greater Bay Bank N. A.. —
Original Filing Number 60032466329 (debtor is listed as Cat Tech Inc.)


 


(xvii)       Wells Fargo Equipment
Finance, Inc. — Original Filing Number 40048335108 (debtor is listed as
Cat Tech Inc.)


 


(xviii)      US Bancorp Equipment Finance, Inc.
— Original Filing Number 40047149140 (debtor is listed as Cat Tech Inc.)


 


(xix)         US Bancorp Equipment Finance, Inc.
— Original Filing Number 40047149362 (debtor is listed as Cat Tech Inc.)


 


(xx)          Citicorp Del Lease, Inc..
— Original Filing Number 30016491004 (debtor is listed as Cat Tech Inc.)


 


(xxi)         Catalyst Technology, Inc.
— Original Filing Number 20032900319 (debtor is listed as Cat Tech Inc.)


 

















 


(xxii)        Bank Of America N.A. —
Original Filing Number 20029901275 (debtor is listed as Cat Tech Inc.)


 


(xxiii)       Bank Of America N.A. —
Original Filing Number 50039157787 (debtor is listed as Cat Tech Inc.)


 


(f)            Breathing Systems International,
LLC


 


(i)            BMO Bank of Montreal —
Original Filing Number 70000788505


 


(ii)           GE Canada Asset Financing
Holding Company — Original Filing Number 60041168218.


 


(g)           Great Lakes Carbon Treatment, Inc.


 


(i)            BMO Bank of Montreal —
Original Filing Number 2007006974-5


 


(ii)           GE Canada Asset Financing
Holding Company — Original Filing Number 2006210148-0


 


(h)           River Valley Energy Services Inc.


 


(i)            Nil