Exhibit 10.2




Execution
Copy




CUSIP
Number:_________________









$80,000,000





CREDIT AGREEMENT





dated as
of July 31, 2007





by and
among





LMI AEROSPACE,
INC.,


as
Borrower,





the
Lenders referred to herein,





and





WACHOVIA BANK, NATIONAL
ASSOCIATION,


as
Administrative Agent,


Swingline
Lender and Issuing Lender





WELLS FARGO BANK, NATIONAL
ASSOCIATION,


as
Syndication Agent





and





WACHOVIA CAPITAL MARKETS,
LLC,


as Joint
Lead Arranger and Joint Book Manager





WELLS FARGO BANK, NATIONAL
ASSOCIATION


as Joint
Lead Arranger and Joint Book Manager





LASALLE BANK NATIONAL
ASSOCIATION,


as Joint
Documentation Agent





CHARTER ONE BANK,
N.A.,


as Joint
Documentation Agent



















Table of
Contents






PageARTICLE
      I DEFINITIONS
              1Section
      1.1                                Definitions
              1Section
      1.2                                Other
      Definitions and Provisions
              20Section
      1.3                                Accounting
      Terms
              21Section
      1.4                                UCC
      Terms
              21Section
      1.5                                Rounding
              21Section
      1.6                                References
      to Agreement and Laws
              21Section
      1.7                                Times
      of Day
              21Section
      1.8                                Letter
      of Credit Amounts
              21ARTICLE
      II REVOLVING CREDIT FACILITY
              21Section
      2.1                                Revolving
      Credit Loans
              21Section
      2.2                                Swingline
      Loans
              22Section
      2.3                                Procedure
      for Advances of Revolving Credit Loans and Swingline Loans
              23Section
      2.4                                Repayment
      of Loans
              24Section
      2.5                                Permanent
      Reduction of the Aggregate Credit Commitment
              25Section
      2.6                                Termination
      of Revolving Credit Facility
              26Section
      2.7                                Increase
      in Aggregate Commitment
              26ARTICLE
      III LETTER OF CREDIT FACILITY
              27Section
      3.1                                L/C
      Commitment
              27Section
      3.2                                Procedure
      for Issuance of Letters of Credit
              27Section
      3.3                                Commissions
      and Other Charges
              28Section
      3.4                                L/C
      Participations
              28Section
      3.5                                Reimbursement
      Obligation of the Borrower
              29Section
      3.6                                Obligations
      Absolute
              30Section
      3.7                                Effect
      of Letter of Credit Application
              30ARTICLE
      IV GENERAL LOAN PROVISIONS
              31Section
      4.1                                Interest
              31Section
      4.2                                Notice
      and Manner of Conversion or Continuation of Loans
              32Section
      4.3                                Fees
              33Section
      4.4                                Manner
      of Payment
              33Section
      4.4                                Manner
      of Payment
              33Section
      4.5                                Evidence
      of Indebtedness
              34Section
      4.5                                Evidence
      of Indebtedness
              34Section
      4.6                                Adjustments
              34Section
      4.7                                Nature
      of Obligations of Lenders Regarding Extensions of Credit;Assumption
      by the Administrative Agent
              35Section
      4.8                                Changed
      Circumstances
              36Section
      4.9                                Indemnity
              37Section
      4.10                              Increased
      Costs
              37Section
      4.11                              Taxes
              38Section
      4.12                              Mitigation
      Obligations; Replacement of Lenders
              40













Section
      4.13                              Security
              41ARTICLE
      V CLOSING; CONDITIONS OF CLOSING AND BORROWING
              42Section
      5.1                                Closing
              42Section
      5.2                                Conditions
      to Closing and Initial Extensions of Credit
              42Section
      5.3                                Conditions
      to All Extensions of Credit
              47Section
      5.4                                Post-Closing
      Conditions
              47ARTICLE
      VI REPRESENTATIONS AND WARRANTIES OF THE BORROWER
              48Section
      6.1                                Representations
      and Warranties
              48Section
      6.2                                Survival
      of Representations and Warranties, Etc.
              55ARTICLE
      VII FINANCIAL INFORMATION AND NOTICES
              56Section
      7.1                                Financial
      Statements and Projections
              56Section
      7.2                                Officer’s
      Compliance Certificate
              57Section
      7.3                                Other
      Reports
              57Section
      7.4                                Notice
      of Litigation and Other Matters
              57Section
      7.5                                Accuracy
      of Information
              58ARTICLE
      VIII AFFIRMATIVE COVENANTS
              59Section
      8.1                                Preservation
      of Corporate Existence and Related Matters
              59Section
      8.2                                Maintenance
      of Property
              59Section
      8.3                                Insurance
              59Section
      8.4                                Accounting
      Methods and Financial Records
              59Section
      8.5                                Payment
      and Performance of Obligations
              59Section
      8.6                                Compliance
      With Laws and Approvals
              60Section
      8.7                                Environmental
      Laws
              60Section
      8.8                                Compliance
      with ERISA
              60Section
      8.9                                Compliance
      With Agreements
              60Section
      8.10                              Visits
      and Inspections
              61Section
      8.11                              Additional
      Subsidiaries
              61Section
      8.12                              Real
      Property Collateral
              61Section
      8.13                              Use
      of Proceeds
              61Section
      8.14                              Further
      Assurances
              62ARTICLE
      IX FINANCIAL COVENANTS
              62Section
      9.1                                Total
      Leverage Ratio
              62Section
      9.2                                Fixed
      Charge Coverage Ratio
              62ARTICLE
      X NEGATIVE COVENANTS
              62Section
      10.1                              Limitations
      on Indebtedness
              62Section
      10.2                              Limitations
      on Liens
              63Section
      10.3                              Limitations
      on Loans, Advances, Investments and Acquisitions
              64Section
      10.4                              Limitations
      on Mergers and Liquidation
              66Section
      10.5                              Limitations
      on Sale of Assets
              67Section
      10.6                              Limitations
      on Dividends and Distributions
              67Section
      10.7                              Limitations
      on Exchange and Issuance of Capital Stock
              67Section
      10.8                              Transactions
      with Affiliates
              67Section
      10.9                              Certain
      Accounting Changes; Organizational Documents
              68Section
      10.10                            Amendments;
      Payments and Prepayments of Subordinated Indebtedness
              68












Section
      10.11                            Restrictive
      Agreements
              68Section
      10.12                            Nature
      of Business
              68Section
      10.13                            Impairment
      of Security Interests
              68Section
      10.14                            Amendments
      and Other Documents
              68ARTICLE
      XI DEFAULT AND REMEDIES
              69Section
      11.1                              Events
      of Default
              69Section
      11.2                              Remedies
              71Section
      11.3                              Rights
      and Remedies Cumulative; Non-Waiver; etc.
              72Section
      11.4                              Crediting
      of Payments and Proceeds
              72Section
      11.5                              Administrative
      Agent May File Proofs of Claim
              73ARTICLE
      XII THE ADMINISTRATIVE AGENT
              74Section
      12.1                              Appointment
              74Section
      12.2                              Delegation
      of Duties
              74Section
      12.3                              Exculpatory
      Provisions
              74Section
      12.4                              Reliance
      by the Administrative Agent
              75Section
      12.5                              Notice
      of Default
              75Section
      12.6                              Non-Reliance
      on the Administrative Agent and Other Lenders
              76Section
      12.7                              Indemnification
              76Section
      12.8                              The
      Administrative Agent in Its Individual Capacity
              77Section
      12.9                              Resignation
      of the Administrative Agent; Successor Administrative
Agent
              77Section
      12.10                            Collateral
      and Guaranty Matters
              78Section
      12.11                            Other
      Agents, Arrangers and Managers
              78ARTICLE
      XIII MISCELLANEOUS
              79Section
      13.1                               Notices
              79Section
      13.2                               Amendments,
      Waivers and Consents
              81Section
      13.3                               Expenses;
      Indemnity
              82Section
      13.4                               Right
      of Set-off
              84Section
      13.5                               Governing
      Law, Jurisdiction, Etc
              85Section
      13.6                               Waiver
      of Jury Trial
              85Section
      13.7                               Reversal
      of Payments
              86Section
      13.8                               Injunctive
      Relief
              86Section
      13.9                               Accounting
      Matters
              86Section
      13.10                             Successors
      and Assigns; Participations
              86Section
      13.11                             Confidentiality
              89Section
      13.12                             Performance
      of Duties
              90Section
      13.13                             All
      Powers Coupled with Interest
              90Section
      13.14                             Survival
      of Indemnities
              90Section
      13.15                             Titles
      and Captions
              90Section
      13.16                             Severability
      of Provisions
              90Section
      13.17                             Counterparts;
      Integration; Effectiveness; Electronic Execution
              91Section
      13.18                             Term
      of Agreement
              91Section
      13.19                             USA
      Patriot Act
              91Section
      13.20                             Advice
      of Counsel; No Strict Construction
              92Section
      13.21                             Inconsistencies
      with Other Documents; Independent Effect of Covenants
              92











EXHIBITS




Exhibit
      A-1
              -
              Form
      of Revolving Credit NoteExhibit
      A-2
              -
              Form
      of Swingline NoteExhibit
      B
              -
              Form
      of Notice of BorrowingExhibit
      C
              -
              Form
      of Notice of Account DesignationExhibit
      D
              -
              Form
      of Notice of PrepaymentExhibit
      E
              -
              Form
      of Notice of Conversion/ContinuationExhibit
      F
              -
              Form
      of Officer’s Compliance CertificateExhibit
      G
              -
              Form
      of Assignment and AssumptionExhibit
      H
              -
              Form
      of Guaranty AgreementExhibit
      I
              -
              Form
      of Collateral Agreement







SCHEDULES




Schedule
      1.1
              -
              Lenders
      and CommitmentsSchedule
      1.1(a)
              -
              Existing
      Letters of CreditSchedule
      6.1(a)
              -
              Jurisdictions
      of Organization and QualificationSchedule
      6.1(b)
              -
              Subsidiaries
      and CapitalizationSchedule
      6.1(f)
              -
              Tax
      AuditsSchedule
      6.1(i)
              -
              ERISA
      PlansSchedule
      6.1(l)
              -
              Material
      ContractsSchedule
      6.1(m)
              -
              Labor
      and Collective Bargaining AgreementsSchedule
      6.1(t)
              -
              Indebtedness
      and Guaranty ObligationsSchedule
      6.1(u)
              -
              LitigationSchedule
      10.2
              -
              Existing
      LiensSchedule
      10.3
              -
              Existing
      Loans, Advances and InvestmentsSchedule
      10.8
              -
              Transactions
      with Affiliates















CREDIT
AGREEMENT, dated as of July 31, 2007, by and among LMI AEROSPACE, INC., a
Missouri corporation (the “Borrower”), the
lenders who are or may become a party to this Agreement (collectively, the
“Lenders”) and
WACHOVIA BANK, NATIONAL ASSOCIATION, a national banking association, as
Administrative Agent for the Lenders.




STATEMENT OF
PURPOSE




The
Borrower has requested, and the Lenders have agreed, to extend certain credit
facilities to the Borrower on the terms and conditions of this
Agreement.




NOW,
THEREFORE, for good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged by the parties hereto, such parties hereby agree
as follows:




ARTICLE
I


DEFINITIONS




Section
1.1  Definitions .  The
following terms when used in this Agreement shall have the meanings assigned to
them below:




“Acquisition” means
the acquisition of all of the stock of D3 by the Borrower as contemplated under
the terms of the Acquisition Agreement.




“Acquisition
Agreement” means that certain Stock Purchase Agreement (together with the
exhibits and the disclosure schedules thereto) dated as of June 17, 2007 by and
among John J. Bogan, Trustee of the John Bogan Separate Property Trust Dated
October 5, 1999, William A. Huston, and the Borrower pursuant to which the
Borrower shall purchase all of the outstanding Capital Stock of D3.




“Act” means the USA
Patriot Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001)), as
amended.




“Administrative Agent”
means Wachovia in its capacity as Administrative Agent hereunder, and any
successor thereto appointed pursuant to Section
12.9.




“Administrative Agent’s
Office” means the office of the Administrative Agent specified in or
determined in accordance with the provisions of Section
13.1(c).




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




“Affiliate” means,
with respect to any Person, any other Person (other than a Subsidiary of the
Borrower) which directly or indirectly through one or more intermediaries,
controls, or is controlled by, or is under common control with, such first
Person or any of its Subsidiaries.  The term “control” means
(a) the power to vote five percent (5%) or more of the securities or other
equity interests of a Person having ordinary voting power, or (b) the
possession, directly or indirectly, of any other power to direct or cause the
direction of the management and policies of a Person, whether through ownership
of voting securities, by contract or otherwise.




“Aggregate Commitment”
means the aggregate amount of the Lenders’ Commitments hereunder, as such amount
may be reduced or otherwise modified at any time or from time to time pursuant
to the terms hereof.  On the Closing Date, the Aggregate Commitment
shall be Eighty Million Dollars ($80,000,000).




“Agreement” means this
Credit Agreement, as amended, restated, supplemented or otherwise modified from
time to time.




“Applicable Law” means
all applicable provisions of constitutions, laws, statutes, ordinances, rules,
treaties, regulations, permits, licenses, approvals, interpretations and orders
of courts or Governmental Authorities and all orders and decrees of all courts
and arbitrators.




“Applicable Margin”
means the corresponding percentages per annum as set forth below:




Level
              Total
      Leverage Ratio
              LIBOR
                Interest
                Margin
              Base
      Rate
                Interest
                Margin
              Commitment
                FeeI
              Less
      than 1.00 to 1.00
              1.125%
              0.125%
              0.200%II
              Greater
      than or equal to 1.00 to
                1.00
      but less than 1.50 to 1.00
              1.375%
              0.375%
              0.250%III
              Greater
      than or equal to 1.50 to
                1.00
      but less than 2.00 to 1.00
              1.500%
              0.500%
              0.300%IV
              Greater
      than or equal to 2.00 to
                1.00
      but less than 2.50 to 1.00
              1.750%
              0.750%
              0.375%V
              Greater
      than or equal to 2.50 to
                1.00
              2.000%
              1.000%
              0.500%




The
Applicable Margin shall be determined and adjusted quarterly on the date (each a
“Calculation
Date”) ten (10) Business Days after the date by which the Borrower is
required to provide an Officer’s Compliance Certificate pursuant to Section 7.2 for the
most recently ended fiscal quarter of the Borrower; provided, however, that (a) the
Applicable Margin shall be based on the Pricing Level corresponding to the Total
Leverage Ratio as of the Closing Date (after giving proforma effect to the
Transactions) until the first Calculation Date following receipt of the
Officer’s Compliance Certificate for the fiscal quarter ended December 31, 2007
and, thereafter, the Pricing Level shall be determined by reference to the Total
Leverage Ratioas
of the last day of the most recently ended fiscal quarter of the Borrower
preceding the applicable Calculation Date, and (b) if the Borrower fails to
provide the Officer’s Compliance Certificate as required by Section 7.2 for the
most recently ended fiscal quarter of the Borrower preceding the applicable
Calculation Date, the Applicable Margin from such Calculation Date shall be
based on Pricing Level V until such time as an appropriate Officer’s Compliance
Certificate is provided, at which time the Pricing Level shall be determined by
reference to the Leverage Ratio as of the last day of the most recently ended
fiscal quarter of the Borrower preceding such Calculation Date.  The
Applicable Margin shall be effective from one Calculation Date until the next
Calculation Date.  Any adjustment in the Applicable Margin shall be
applicable to all Extensions of Credit then existing or subsequently made or
issued.




Notwithstanding
the foregoing, in the event that any financial statement or Officer’s Compliance
Certificate delivered pursuant to Section 7.2 is shown
to be inaccurate (regardless of whether (A) this Agreement is in effect, (B) the
Commitments are in effect, or (C) any Extension of Credit is outstanding when
such inaccuracy is discovered or such financial statement or Officer’s
Compliance Certificate was delivered), and such inaccuracy, if corrected, would
have led to the application of a higher Applicable Margin for any period (an
“Applicable
Period”) than the Applicable Margin applied for such Applicable Period,
and only in such case, then (1) the Borrower shall immediately deliver to the
Administrative Agent a corrected Officer’s Compliance Certificate for such
Applicable Period, (2) the Applicable Margin for such Applicable Period shall be
determined as if the Total Leverage Ratio in the corrected Officer’s Compliance
Certificate were applicable for such Applicable Period and (3) the Borrower
shall immediately pay to the Administrative Agent the accrued additional
interest owing as a result of such increased Applicable Margin for such
Applicable Period, which payment shall be promptly applied by the Administrative
Agent in accordance with Section
4.4.  Nothing in this paragraph shall limit the rights of the
Administrative Agent and Lenders with respect to Sections 4.1(c) and
11.2.




“Approved Fund” means
any Person (other than a natural Person), including, without limitation, any
special purpose entity, that is (or will be) engaged in making, purchasing,
holding or otherwise investing in commercial loans and similar extensions of
credit in the ordinary course of its business; provided, that such
Approved Fund must be administered by (a) a Lender, (b) an Affiliate of a Lender
or (c) an entity or an Affiliate of an entity that administers or manages a
Lender.




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




“Attributable
Indebtedness” means, on any date, (a) in respect of any Capital Lease of
any Person, the capitalized amount thereof that would appear on a balance sheet
of such Person prepared as of such date in accordance with GAAP, and (b) in
respect of any Synthetic Lease, the capitalized amount or principal amount of
the remaining lease payments under the relevant lease that would appear on a
balance sheet of such Person prepared as of such date in accordance with GAAP if
such lease were accounted for as a Capital Lease.




“Bankruptcy Event of
Default” means any Event of Default specified in Section 11.1(j)
or(k).




“Base Rate” means, at
any time, the higher of (a) the Prime Rate and (b) the Federal Funds Rate plus 1/2 of 1%; each
change in the Base Rate shall take effect simultaneously with the corresponding
change or changes in the Prime Rate or the Federal Funds Rate.




“Base Rate Loan” means
any Loan bearing interest at a rate based upon the Base Rate as provided in
Section
4.1(a).




“Borrower” has the
meaning assigned thereto in the introductory paragraph hereto.




“Borrower Materials”
has the meaning assigned thereto in Section
7.4.




“Business Day” means
(a) for all purposes other than as set forth in clause (b) below, any day other
than a Saturday, Sunday or legal holiday on which banks in Charlotte, North
Carolina and New York, New York, are open for the conduct of their commercial
banking business, and (b) with respect to all notices and determinations in
connection with, and payments of principal and interest on, any LIBOR Rate Loan,
any day that is a Business Day described in clause (a) and that is also a day
for trading by and between banks in Dollar deposits in the London interbank
market.




“Calculation Date” has
the meaning assigned thereto in the definition of Applicable
Margin.




“Capital Expenditures”
means, with respect to the Borrower and its Subsidiaries for any period, the
aggregate cost of all Capital Assets acquired by the Borrower and its
Subsidiaries during such period, as determined in accordance with
GAAP.




“Capital Lease” means
any lease of any property by the Borrower or any of its Subsidiaries, as lessee,
that should, in accordance with GAAP, be classified and accounted for as a
capital lease on a Consolidated balance sheet of the Borrower and its
Subsidiaries.




“Capital Stock” means
(a) in the case of a corporation, capital stock, (b) in the case of an
association or business entity, any and all shares, interests, participations,
rights or other equivalents (however designated) of capital stock, (c) in the
case of a partnership, partnership interests (whether general or limited), (d)
in the case of a limited liability company, membership interests and (e) any
other interest or participation that confers on a Person the right to receive a
share of the profits and losses of, or distributions of assets of, the issuing
Person.




“Cash Equivalents”
means, collectively, the items described in Section
10.3(b)(i)-(iv).




“Change in Control”
means any event or series of events in which any person or group of persons
(within the meaning of Section 13(d) of the Securities Exchange Act of 1934, as
amended), obtain ownership or control in one or more series of transactions of
more than thirty percent (30%) of the Capital Stock or thirty percent (30%) of
the voting power of the Borrower entitled to vote in the election of members of
the board of directors of the Borrower or there shall have occurred under any
indenture or other instrument evidencing any Indebtedness in excess of $500,000
any “change in control” (as defined in such indenture or other evidence of
Indebtedness) obligating the Borrower to repurchase, redeem or repay all or any
part of the Indebtedness or Capital Stock provided for therein.




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




“Closing Date” means
the date of this Agreement or such later Business Day upon which each condition
described in Section
5.2 shall be satisfied or waived in all respects in a manner acceptable
to the Administrative Agent, in its sole discretion.




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




“Collateral” means the
collateral security for the Obligations pledged or granted pursuant to the
Security Documents.




“Collateral Agreement”
means the collateral agreement of even date executed by the Credit Parties in
favor of the Administrative Agent, for the benefit of itself and the other
Secured Parties, substantially in the form of Exhibit I, as amended,
restated, supplemented or otherwise modified from time to time.




“Commitment” means, as
to any Lender, the obligation of such Lender to make Loans (including, without
limitation, to participate in Swingline Loans) and to and issue or participate
in Letters of Credit issued for the account of the Borrower, in an aggregate
principal or face amount at any time outstanding not to exceed the amount set
forth opposite such Lender’s name on Schedule 1.1 hereto,
as the same may be reduced or modified at any time or from time to time pursuant
to the terms hereof.




“Commitment
Percentage” means, as to any Lender at any time, the ratio of (a) the
amount of the Commitment of such Lender to (b) the Aggregate
Commitment.




“Consolidated” means,
when used with reference to financial statements or financial statement items of
the Borrower and its Subsidiaries, such statements or items on a consolidated
basis in accordance with applicable principles of consolidation under
GAAP.




“Credit Facility”
means, collectively, the Revolving Credit Facility, the Swingline Facility and
the L/C Facility.




“Credit Parties”
means, collectively, the Borrower and the Guarantors.




“D3” means D3
Technologies Inc., a California corporation.




“Default” means any of
the events specified in Section 11.1 which
with the passage of time, the giving of notice or any other condition, would
constitute an Event of Default.




“Defaulting Lender”
means any Lender that (a) has failed to fund any portion of the Revolving Credit
Loans, participations in L/C Obligations or participations in Swingline Loans
required to be funded by it hereunder within one Business Day of the date
required to be funded by it hereunder, (b) has otherwise failed to pay over to
the Administrative Agent or any other Lender any other amount required to be
paid by it hereunder within one Business Day of the date when due, unless such
amount is the subject of a good faith dispute, or (c) has been deemed insolvent
or become the subject of a bankruptcy or insolvency proceeding.




“Dollars” or “$”
means, unless otherwise qualified, dollars in lawful currency of the United
States.




“Domestic Subsidiary”
means any Subsidiary organized under the laws of any political subdivision of
the United States.




“EBITDA” means, for
any period, the sum of the following determined on a Consolidated basis, without
duplication, for the Borrower and its Subsidiaries in accordance with
GAAP:  (a) Net Income for such period plus (b) the sum of
the following to the extent deducted in determining Net Income for such period:
(i) income and franchise taxes for such period, (ii) Interest Expense for such
period, (iii) amortization and depreciation for such period, (iv) any
extraordinary losses for such period and (v) bonus payments to employees of the
Seller during such period in connection with the Acquisition (provided that the
aggregate amount of such bonus payments shall not exceed $3,000,000) less (c) interest
income and any extraordinary gains for such period.  For purposes of
this Agreement, EBITDA shall be adjusted on a proforma basis, in a
manner reasonably acceptable to the Administrative Agent, to include, as of the
first day of any applicable period, any Permitted Acquisitions and any Asset
Dispositions closed during such period, including, without limitation,
adjustments reflecting any non-recurring costs and any extraordinary expenses of
any Permitted Acquisitions and any Asset Dispositions closed during such period
calculated on a basis consistent with GAAP and Regulation S-X of the Securities
Exchange Act of 1934, as amended, or as approved by the Administrative
Agent.




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




“Employee Benefit
Plan” means any employee benefit plan within the meaning of Section 3(3)
of ERISA which (a) is maintained for employees of the Borrower or any ERISA
Affiliate or (b) has at any time within the preceding six (6) years been
maintained for the employees of the Borrower or any current or former ERISA
Affiliate.




“Employment
Agreements” means, collectively, each employment agreement executed by
and between a key employee and the Borrower as required under the terms of the
Acquisition Agreement.




“Environmental Claims”
means any and all administrative, regulatory or judicial actions, suits,
demands, demand letters, claims, liens, accusations, allegations, notices of
noncompliance or violation, investigations (other than internal reports prepared
by any Person in the ordinary course of business and not in response to any
third party action or request of any kind) or proceedings relating in any way to
any actual or alleged violation of or liability under any Environmental Law or
relating to any permit issued, or any approval given, under any such
Environmental Law, including, without limitation, any and all claims by
Governmental Authorities for enforcement, cleanup, removal, response, remedial
or other actions or damages, contribution, indemnification cost recovery,
compensation or injunctive relief resulting from Hazardous Materials or arising
from alleged injury or threat of injury to human health or the
environment.




“Environmental Laws”
means any and all federal, foreign, state, provincial and local laws, statutes,
ordinances, codes, rules, standards and regulations, permits, licenses,
approvals, interpretations and orders of courts or Governmental Authorities,
relating to the protection of human health or the environment, including, but
not limited to, requirements pertaining to the manufacture, processing,
distribution, use, treatment, storage, disposal, transportation, handling,
reporting, licensing, permitting, investigation or remediation of Hazardous
Materials.




“ERISA” means the
Employee Retirement Income Security Act of 1974, and the rules and regulations
thereunder, each as amended or modified from time to time.




“ERISA Affiliate”
means any Person who together with any Credit Party is treated as a single
employer within the meaning of Section 414(b), (c), (m) or (o) of the Code or
Section 4001(b) of ERISA.




“Escrow Agreement”
means the escrow agreement by and among the Borrower, the Sellers and the escrow
agent under the terms of the Acquisition Agreement.




“Eurodollar Reserve
Percentage” means, for any day, the percentage (expressed as a decimal
and rounded upwards, if necessary, to the next higher 1/100th of 1%) which is in
effect for such day as prescribed by the Board of Governors of the Federal
Reserve system (or any successor) for determining the maximum reserve
requirement (including, without limitation, any basic, supplemental or emergency
reserves) in respect of eurocurrency liabilities or any similar category of
liabilities for a member bank of the Federal Reserve System in New York
City.




“Event of Default”
means any of the events specified in Section 11.1; provided that any
requirement for passage of time, giving of notice, or any other condition, has
been satisfied.




“Excluded Taxes”
means, with respect to the Administrative Agent, any Lender, any Issuing Lender
or any other recipient of any payment to be made by or on account of any
obligation of the Borrower hereunder, (a) taxes imposed on or measured by its
overall net income (however denominated), and franchise taxes imposed on it (in
lieu of net income taxes), by the jurisdiction (or any political subdivision
thereof) under the laws of which such recipient is organized or in which its
principal office is located or, in the case of any Lender, in which its
applicable lending office is located, (b) any branch profits taxes imposed by
the United States or any similar tax imposed by any other jurisdiction in which
the Borrower is located and (c) in the case of a Foreign Lender (other than an
assignee pursuant to a request by the Borrower under Section 4.12(b)), any
withholding tax that is imposed on amounts payable to such Foreign Lender at the
time such Foreign Lender becomes a party hereto (or designates a new lending
office) or is attributable to such Foreign Lender’s failure or inability (other
than as a result of a Change in Law) to comply with Section 4.11(e),
except to the extent that such Foreign Lender (or its assignor, if any) was
entitled, at the time of designation of a new lending office (or assignment), to
receive additional amounts from the Borrower with respect to such withholding
tax pursuant to Section
4.11(a).




“Existing Facilities”
means, collectively, (a) that certain credit facility evidenced by the Amended
and RestatedCredit
Agreement dated as of December 28, 2006 by and among Leonard’s Metal, Inc., LMI
Finishing, Inc., Tempco Engineering, Inc., Versaform Corporation, Precise
Machine Partners, LLP and LMI-TCA, Inc., as borrowers, and Wells Fargo Bank,
National Association, as lender, and (b) that certain credit facility evidenced
by the Revolving Credit Agreement dated as of December 6, 2002 by and between
D3, as borrower, and U.S. Bank, N.A., as lender.




“Existing Letters of
Credit” means those letters of credit existing on the Closing Date and
identified on Schedule
1.1(a).




“Extensions of Credit”
means, as to any Lender at any time, (a) an amount equal to the sum of (i) the
aggregate principal amount of all Revolving Credit Loans made by such Lender
then outstanding, (ii) such Lender’s Commitment Percentage of the L/C
Obligations then outstanding and (iii) such Lender’s Commitment Percentage of
the Swingline Loans then outstanding, or (b) the making of any Loan or
participation in any Letter of Credit by such Lender, as the context
requires.




“FDIC” means the
Federal Deposit Insurance Corporation, or any successor thereto.




“Federal Funds Rate”
means, for any day, the rate per annum equal to the weighted average of the
rates on overnight Federal funds transactions with members of the Federal
Reserve System arranged by federal funds brokers on such day (or, if such day is
not a Business Day, for the immediately preceding Business Day), as published by
the Federal Reserve Bank of New York on the Business Day next succeeding such
day, provided
that if such rate is not so published for any day which is a Business Day, the
average of the quotation for such day on such transactions received by the
Administrative Agent from three (3) Federal Funds brokers of recognized standing
selected by the Administrative Agent.




“Fee Letter” means the
separate fee letter agreement executed by the Borrower and the Administrative
Agent and/or certain of its affiliates dated May 31, 2007.




“Fiscal Year” means
the fiscal year of the Borrower and its Subsidiaries ending on December
31.




“Fixed Charges” means,
for any period, the sum of the following determined on a Consolidated basis for
such period, without duplication, for the Borrower and its Subsidiaries in
accordance with GAAP: (a) Interest Expense paid or payable in cash during such
period, (b) scheduled principal payments with respect to Indebtedness during
such period, (c) taxes paid or payable in cash during such period and (d) cash
dividends and distributions paid in respect of the ownership of the Capital
Stock of the Borrower or any of its Subsidiaries.




“Fixed Charge Coverage
Ratio” means, with respect to the Borrower and its Subsidiaries as of any
date of determination, the ratio of (a) EBITDA minus Capital
Expenditures to (b) Fixed Charges, in each case determined for the Borrower and
its Subsidiaries, on a Consolidated basis, for the period of four (4)
consecutive fiscal quarters ending on or immediately prior to such
date.




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




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




“GAAP” means generally
accepted accounting principles, as recognized by the American Institute of
Certified Public Accountants and the Financial Accounting Standards Board,
consistently applied and maintained on a consistent basis for the Borrower and
its Subsidiaries throughout the period indicated and (subject to Section 13.9)
consistent with the prior financial practice of the Borrower and its
Subsidiaries.




“Government Contract”
has the meaning set forth in the Collateral Agreement.




“Governmental
Approvals” means all authorizations, consents, approvals, permits,
licenses and exemptions of, registrations and filings with, and reports to, all
Governmental Authorities.




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




“Guarantors” means
each Subsidiary of the Borrower in existence on the Closing Date
or  which becomes a party to a Guaranty Agreement pursuant to Section
8.11.




“Guaranty Agreement”
means the unconditional guaranty agreement of even date herewith executed by the
Guarantors in favor of the Administrative Agent, for the ratable benefit of
itself and the other Secured Parties, substantially in the form of Exhibit H, as amended,
restated, supplemented or otherwise modified from time to time.




“Guaranty Obligation”
means, with respect to the Borrower and its Subsidiaries, without duplication,
any obligation, contingent or otherwise, of any such Person pursuant to which
such Person has directly or indirectly guaranteed any Indebtedness or other
obligation of any other Person and, without limiting the generality of the
foregoing, any obligation, direct or indirect, contingent or otherwise, of any
such Person (a) to purchase or pay (or advance or supply funds for the
purchase or payment of) such Indebtedness or other obligation (whether arising
by virtue of partnership arrangements, by agreement to keep well, to purchase
assets, goods, securities or services, to take-or-pay, or to maintain financial
statement condition or otherwise) or (b) entered into for the purpose of
assuring in any other manner the obligee of such Indebtedness or other
obligation of the payment thereof or to protect such obligee against loss in
respect thereof (in whole or in part); provided, that the
term Guaranty Obligation shall not include endorsements for collection or
deposit in the ordinary course of business.




“Hazardous Materials”
means any substances or materials (a) which are or become defined as hazardous
wastes, hazardous substances, pollutants, contaminants, chemical substances or
mixtures or toxic substances under any Environmental Law, (b) which are
toxic, explosive, corrosive, flammable, infectious, radioactive, carcinogenic,
mutagenic or otherwise harmful to human health or the environment and are or
become regulated by any Governmental Authority, (c) the presence of which
require investigation or remediation under any Environmental Law or common law,
(d) the discharge or emission or release of which requires a permit or license
under any Environmental Law or other Governmental Approval, (e) which are
deemed to constitute a nuisance or a trespass which pose a health or safety
hazard to Persons or neighboring properties, (f) which consist of
underground or aboveground storage tanks, whether empty, filled or partially
filled with any substance, or (g) which contain, without limitation,
asbestos, polychlorinated biphenyls, urea formaldehyde foam insulation,
petroleum hydrocarbons, petroleum derived substances or waste, crude oil,
nuclear fuel, natural gas or synthetic gas.




“Hedging Agreement”
means any agreement with respect to any Interest Rate Contract, forward rate
agreement, commodity swap, forward foreign exchange agreement, currency swap
agreement, cross-currency rate swap agreement, currency option agreement or
other agreement or arrangement designed to alter the risks of any Person arising
from fluctuations in interest rates, currency values or commodity prices, all as
amended, restated, supplemented or otherwise modified from time to
time.




“Hedging Obligations”
means all existing or future payment and other obligations owing by the Borrower
under any Hedging Agreement (which such Hedging Agreement is permitted
hereunder) with any Person that is a Lender or an Affiliate of a Lender at the
time such Hedging Agreement is executed.




“Indebtedness” means,
with respect to the Borrower and its Subsidiaries at any date and without
duplication, the sum of the following:




(a)           all
liabilities, obligations and indebtedness for borrowed money including, but not
limited to, obligations evidenced by bonds, debentures, notes or other similar
instruments of any such Person;




(b)           all
obligations to pay the deferred purchase price of property or services of any
such Person (including, without limitation, all obligations under
non-competition, earn-out or similar agreements), except trade payables arising
in the ordinary course of business not more than ninety (90) days past
due;




(c)           the
Attributable Indebtedness of such Person with respect to such Person’s
obligations in respect of Capital Leases and Synthetic Leases (regardless of
whether accounted for as indebtedness under GAAP);




(d)           all
Indebtedness of any other Person secured by a Lien on any asset owned or being
purchased by such Person (including indebtedness arising under conditional sales
or other title retention agreements), whether or not such indebtedness shall
have been assumed by such Person or is limited in recourse;




(e)           all
Guaranty Obligations of any such Person;




(f)           all
obligations, contingent or otherwise, of any such Person relative to the face
amount of letters of credit, whether or not drawn, including, without
limitation, any Reimbursement Obligation, and banker’s acceptances issued for
the account of any such Person;




(g)           all
obligations of any such Person to redeem, repurchase, exchange, defease or
otherwise make payments in respect of Capital Stock of such Person;
and




(h)           all
net obligations incurred by any such Person pursuant to Hedging
Agreements.




For all
purposes hereof, the Indebtedness of any Person shall include the Indebtedness
of any partnership or joint venture (other than a joint venture that is itself a
corporation or limited liability company) in which such Person is a general
partner or a joint venturer, unless such Indebtedness is expressly made
non-recourse to such Person.  The amount of any net obligation of any
Person under any Hedging Agreement on any date shall be deemed to be the
Termination Value thereof as of such date.




“Indemnified Taxes”
means Taxes and Other Taxes other than Excluded Taxes.




“Interest Expense”
means, with respect to the Borrower and its Subsidiaries for any period, the
gross interest expense (including, without limitation, interest expense
attributable to Capital Leases, Synthetic Leases and all net payment obligations
pursuant to Hedging Agreements) of the Borrower and its Subsidiaries, all
determined for such period on a Consolidated basis, without duplication, in
accordance with GAAP.




“Interest Period” has
the meaning assigned thereto in Section
4.1(b).




“Interest Rate
Contract” means any interest rate swap agreement, interest rate cap
agreement, interest rate floor agreement, interest rate collar agreement,
interest rate option or any other agreement regarding the hedging of interest
rate risk exposure executed in connection with hedging the interest rate
exposure of any Person and any confirming letter executed pursuant to such
agreement, all as amended, restated, supplemented or otherwise modified from
time to time.




“ISP98” means the
International Standby Practices (1998 Revision, effective January 1, 1999),
International Chamber of Commerce Publication No. 590.




“Issuing Lender” means
Wachovia, in its capacity as issuer of any Letter of Credit, or any successor
thereto and any other Lender designated by the Borrower as an Issuing Lender
(with reasonable prior notice to the Administrative Agent of such designation)
and acceptable to the Administrative Agent.




“L/C Commitment” means
the lesser of (a) Ten Million Dollars ($10,000,000) and (b) the Aggregate
Commitment.




“L/C Facility” means
the letter of credit facility established pursuant to Article
III.




“L/C Obligations”
means at any time, an amount equal to the sum of (a) the aggregate undrawn and
unexpired amount of the then outstanding Letters of Credit and (b) the aggregate
amount of drawings under Letters of Credit which have not then been reimbursed
pursuant to Section
3.5.




“L/C Participants”
means the collective reference to all the Lenders other than the applicable
Issuing Lender.




“Lender” means each
Person executing this Agreement as a Lender (including, without limitation, each
Issuing Lender and the Swingline Lender unless the context otherwise requires)
set forth on the signature pages hereto and each Person that hereafter becomes a
party to this Agreement as a Lender pursuant to Section
13.10.




“Lending Office”
means, with respect to any Lender, the office of such Lender maintaining such
Lender’s Extensions of Credit.




“Letter of Credit
Application” means an application, in the form specified by the
applicable Issuing Lender from time to time, requesting the applicable Issuing
Lender to issue a Letter of Credit.




“Letters of Credit”
has the meaning assigned thereto in Section
3.1.




“LIBOR” means the rate
of interest per annum determined on the basis of the rate for deposits in
Dollars in minimum amounts of at least $5,000,000 for a period equal to the
applicable Interest Period which appears on the Reuters Screen LIBOR01 Page at
approximately 11:00 a.m. (London time) two (2) Business Days prior to the first
day of the applicable Interest Period (rounded upward, if necessary, to the
nearest 1/100th of 1%).  If, for any reason, such rate does not appear
on Telerate Page 3750, then “LIBOR” shall be determined by the Administrative
Agent to be the arithmetic average of the rate per annum at which deposits in
Dollars in minimum amounts of at least $5,000,000 would be offered by first
class banks in the London interbank market to the Administrative Agent at
approximately 11:00 a.m. (London time) two (2) Business Days prior to the first
day of the applicable Interest Period for a period equal to such Interest
Period.  Each calculation by the Administrative Agent of LIBOR shall
be conclusive and binding for all purposes, absent manifest error.




“LIBOR Rate” means a
rate per annum (rounded upwards, if necessary, to the next higher 1/100th of 1%)
determined by the Administrative Agent pursuant to the following
formula:







LIBOR
      Rate =
              LIBOR1.00-Eurodollar
      Reserve Percentage




“LIBOR Rate Loan”
means any Loan bearing interest at a rate based upon the LIBOR Rate as provided
in Section
4.1(a).




“Lien” means, with
respect to any asset, any mortgage, leasehold mortgage, lien, pledge, charge,
security interest, hypothecation or encumbrance of any kind in respect of such
asset.  For the purposes of this Agreement, a Person shall be deemed
to own subject to a Lien any asset which it has acquired or holds subject to the
interest of a vendor or lessor under any conditional sale agreement, Capital
Lease or other title retention agreement relating to such asset.




“Loan Documents”
means, collectively, this Agreement, each Note, the Letter of Credit
Applications, the Guaranty Agreement, the Security Documents and each other
document, instrument, certificate and agreement executed and delivered by the
Borrower or any Subsidiary thereof in connection with this Agreement or
otherwise referred to herein or contemplated hereby (excluding any Hedging
Agreement), all as may be amended, restated, supplemented or otherwise modified
from time to time.




“Loans” means the
collective reference to the Revolving Credit Loans and the Swingline Loans and
“Loan” means any of such Loans.




“Material Adverse
Effect” means, with respect to the Borrower or any of its Subsidiaries, a
material adverse effect on (a) the properties, business, prospects, operations
or condition (financial or otherwise) of the Borrower and its Subsidiaries taken
as a whole, (b) the ability of any such Person to perform its obligations under
the Loan Documents to which it is a party or (c) the legality, validity, binding
effect or enforceability of the  Loan Documents or the rights and
remedies available to the Administrative Agent and the Lenders, in each case,
taken as a whole.




“Material Contract”
means (a) any contract or other agreement, written or oral, of the Borrower or
any of its Subsidiaries involving monetary liability of or to any such Person in
an amount in excess of $1,000,000 per annum, or (b) any other contract or
agreement, written or oral, of the Borrower or any of its Subsidiaries the
failure to comply with which could reasonably be expected to have a Material
Adverse Effect.




“Material Government
Contract” has the meaning set forth in the Collateral
Agreement.




“Maturity Date” means
the earliest to occur of (a) July 31, 2012, (b) the date of termination by
the Borrower pursuant to Section 2.5, or (c)
the date of termination by the Administrative Agent on behalf of the Lenders
pursuant to Section
11.2(a).




“Mortgages” means the
collective reference to each mortgage, deed of trust or other real property
security document, encumbering all real property now or hereafter owned by any
Credit Party or any Subsidiary thereof, in each case, in form and substance
reasonably satisfactory to the Administrative Agent and executed by any Credit
Party or any Subsidiary thereof in favor of the Administrative Agent, for the
ratable benefit of itself and the other Secured Parties, as any such document
may be amended, restated, supplemented or otherwise modified from time to
time.




“Multiemployer Plan”
means a “multiemployer plan” as defined in Section 4001(a)(3) of ERISA to which
the Borrower or any ERISA Affiliate is making, or is accruing an obligation to
make, or has accrued an obligation to make contributions within the preceding
six (6) years.




“Net Income” means,
with respect to the Borrower and its Subsidiaries for any period of
determination, the net income (or loss) of the Borrower and its Subsidiaries for
such period, determined on a Consolidated basis in accordance with GAAP; provided that there
shall be excluded from Net Income (a) the net income (or loss) of any Person
(other than a Subsidiary which shall be subject to clause (c) below), in which
the Borrower or any of its Subsidiaries has a joint interest with a third party,
except to the extent such net income is actually paid to the Borrower or any of
its Subsidiaries by dividend or other distribution during such period, (b) the
net income (or loss) of any Person accrued prior to the date it becomes a
Subsidiary of such Person or is merged into or consolidated with such Person or
any of its Subsidiaries or that Person’s assets are acquired by such Person or
any of its Subsidiaries except to the extent included pursuant to the foregoing
clause (a), and (c) the net income (if positive) of any Subsidiary to the extent
that the declaration or payment of dividends or similar distributions by such
Subsidiary to the Borrower or any of its Subsidiaries of such net income (i) is
not at the time permitted by operation of the terms of its charter or any
agreement, instrument, judgment, decree, order, statute rule or governmental
regulation applicable to such Subsidiary or (ii) would be subject to any taxes
payable on such dividends or distributions.




“Notes” means the
collective reference to the Revolving Credit Notes and the Swingline
Note.




“Notice of Account
Designation” has the meaning assigned thereto in Section
2.3(b).




“Notice of Borrowing”
has the meaning assigned thereto in Section
2.3(a).




“Notice of
Conversion/Continuation” has the meaning assigned thereto in Section
4.2.




“Notice of Prepayment”
has the meaning assigned thereto in Section
2.4(c).




“Obligations” means,
in each case, whether now in existence or hereafter arising: (a) the principal
of and interest on (including interest accruing after the filing of any
bankruptcy or similar petition) the Loans, (b) the L/C Obligations, (c) all
Specified Obligations and (d) all other fees and commissions (including
attorneys’ fees), charges, indebtedness, loans, liabilities, financial
accommodations, obligations, covenants and duties owing by the Borrower or any
of its Subsidiaries to the Lenders or the Administrative Agent, in each case
under any Loan Document or otherwise, with respect to any Loan or Letter of
Credit of every kind, nature and description, direct or indirect, absolute or
contingent, due or to become due, contractual or tortious, liquidated or
unliquidated, and whether or not evidenced by any note; provided that (a)
Specified Obligations, as applicable, shall be secured and guaranteed pursuant
to the Security Documents only to the extent that, and for so long as, the other
Obligations are so secured and guaranteed and (b) any release of Collateral
or Guarantors effected in the manner permitted by this Agreement shall not
require the consent of holders of Specified Obligations.




“OFAC” means the U.S.
Department of the Treasury’s Office of Foreign Assets Control.




“Officer’s Compliance
Certificate” means a certificate of the chief financial officer or the
treasurer of the Borrower substantially in the form of Exhibit
F.




“Operating Lease”
means, as to any Person as determined in accordance with GAAP, any lease of
property (whether real, personal or mixed) by such Person as lessee which is not
a Capital Lease.




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




“Participant” has the
meaning assigned thereto in Section
13.10(d).




“Patent Security
Agreement” means that certain Patent Security Agreement dated as of the
Closing Date by and among Versaform Corp. and the Administrative
Agent.




“Payment Event of
Default” means any Event of Default specified in Section 11.1(a)
or(b).




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




“Pension Plan” means
any Employee Benefit Plan, other than a Multiemployer Plan, which is subject to
the provisions of Title IV of ERISA or Section 412 of the Code and which (a) is
maintained for the employees of the Borrower or any ERISA Affiliates or (b) has
at any time within the preceding six (6) years been maintained for the employees
of the Borrower or any of its current or former ERISA Affiliates.




“Permitted
Acquisitions” means the acquisitions permitted pursuant to Section
10.3(c).




“Permitted Liens”
means the Liens permitted pursuant to Section
10.2.




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




“Platform” has the
meaning assigned thereto in Section
7.4.




“Post-Closing
Deadline” means September 30, 2007, as such date may be extended at the
sole discretion of the Administrative Agent.




“Prime Rate” means, at
any time, the rate of interest per annum publicly announced from time to time by
Wachovia as its prime rate.  Each change in the Prime Rate shall be
effective as of the opening of business on the day such change in such prime
rate occurs.  The parties hereto acknowledge that the rate announced
publicly by Wachovia as its prime rate is an index or base rate and shall not
necessarily be its lowest or best rate charged to its customers or other
banks.




“Private Information”
has the meaning assigned thereto in Section
7.4.




“Public Information”
has the meaning assigned thereto in Section
7.4.




“Register” has the
meaning assigned thereto in Section
13.10(c).




“Reimbursement
Obligation” means the obligation of the Borrower to reimburse the
applicable Issuing Lender pursuant to Section 3.5 for
amounts drawn under Letters of Credit.




“Related Documents”
mean the Acquisition Agreement, the Employment Agreements, the Seller
Noncompetition Agreements andthe Escrow
Agreement.




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




“Required Lenders”
means, at any date, any combination of Lenders whose Commitments aggregate more
than fifty percent (50%) of the Aggregate Commitment or, if the Credit Facility
has been terminated pursuant to Section 11.2, any
combination of Lenders holding more than fifty percent (50%) of the aggregate
Extensions of Credit; provided that the
Commitment of, and the portion of the Extensions of Credit, as applicable, held
or deemed held by, any Defaulting Lender shall be excluded for purposes of
making a determination of Required Lenders.




“Responsible Officer”
means the chief executive officer, president, chief financial officer,
controller, treasurer or assistant treasurer or senior manager of financial
reporting of a Credit Party or any other officer of a Credit Party reasonably
acceptable to the Administrative Agent.  Any document delivered
hereunder that is signed by a Responsible Officer of a Credit Party shall be
conclusively presumed to have been authorized by all necessary corporate,
partnership and/or other action on the part of such Credit Party and such
Responsible Officer shall be conclusively presumed to have acted on behalf of
such Credit Party.




“Revolving Credit
Facility” means the revolving credit facility established pursuant to
Article
II.




“Revolving Credit
Loans” means any revolving loan made to the Borrower pursuant to Section 2.1, and all
such revolving loans collectively as the context requires.




“Revolving Credit
Note” means a promissory note made by the Borrower in favor of a Lender
evidencing the Revolving Credit Loans made by such Lender, substantially in the
form of Exhibit A-1 hereto,
and any amendments, supplements and modifications thereto, any substitutes
therefor, and any replacements, restatements, renewals or extension thereof, in
whole or in part.




“Sanctioned Entity”
shall mean (a) an agency of the government of, (b) an organization directly or
indirectly controlled by, or (c) a person resident in a country that is subject
to a sanctions program identified on the list maintained by OFAC and available
at http://www.treas.gov/offices/enforcement/ofac/programs,
or as otherwise published from time to time as such program may be applicable to
such agency, organization or person.




“Sanctioned Person”
shall mean a person named on the list of Specially Designated Nationals or
Blocked Persons maintained by OFAC available at http://www.treas.gov/offices/




enforcement/ofac/sdn/index.html,
or as otherwise published from time to time.




“Secured Parties”
means the Administrative Agent, the Lenders, any party to a Specified Hedge
Agreement that was a Lender or an Affiliate of a Lender at the time such
Specified Hedge Agreement was executed, any party to a Specified Cash Management
Arrangement that was a Lender or an Affiliate of a Lender at the time such
Specified Cash Management Arrangement was executed, any other holder from time
to time of any of the Obligations and, in each case, their respective successors
and permitted assigns.




“Security Documents”
means the collective reference to the Collateral Agreement, the Mortgages, the
Patent Security Agreement, the Trademark Security Agreementand each other agreement
or writing pursuant to which any Credit Party purports to pledge or grant a
security interest in any property or assets securing the Obligations or any such
Person purports to guaranty the payment and/or performance of the Obligations,
in each case, as amended, restated, supplemented or otherwise modified from time
to time.




“Seller Noncompetition
Agreements” means, collectively, each noncompetition agreement executed
by a Seller in favor of the Borrower under the terms of the Acquisition
Agreement.




“Sellers” mean,
collectively, John J. Bogan, Trustee of the John Bogan Separate Property Trust
Dated October 5, 1999, and William A. Huston.




“Solvent” means, as to
the Borrower and its Subsidiaries on a particular date, that any such Person (a)
has capital sufficient to carry on its business and transactions and all
business and transactions in which it is about to engage and is able to pay its
debts as they mature, (b) has assets having a value, both at fair valuation
and at present fair saleable value, greater than the amount required to pay its
probable liabilities (including contingencies), and (c) does not believe that it
will incur debts or liabilities beyond its ability to pay such debts or
liabilities as they mature.




“Specified Cash Management
Arrangement” means any cash management arrangement (a) entered into by
(i) any Credit Party or any Subsidiary thereof and (ii) any Lender or any
Affiliate thereof at the time such cash management arrangement was entered into,
as counterparty, and (b) which has been designated by such Lender or such
Affiliate and the Borrower, by notice to the Administrative Agent not later than
thirty (30) days after the execution and delivery by such Credit Party or such
Subsidiary thereof, as a Specified Cash Management Arrangement.  The
designation of any cash management arrangement as a Specified Cash Management
Arrangement shall not create in favor of the Lender or Affiliate thereof that is
a party thereto any rights in connection with the management or release of any
Collateral or of the obligations of any Credit Party under the Collateral
Agreement or any Guaranty Agreement.




“Specified Cash Management
Obligations” means all existing or future payment and other obligations
owing by any Credit Party or any Subsidiary thereof under any Specified Cash
Management Arrangement.




“Specified Hedge
Agreement” means any Hedge Agreement (a) entered into by (i) any
Credit Party or any Subsidiary thereof and (ii) any Lender or any Affiliate
thereof at the time such Hedge Agreement was entered into, as counterparty and
(b) that has been designated by such Lender and the Borrower, by notice to the
Administrative Agent not later than thirty (30) days after the execution and
delivery by such Credit Party or such Subsidiary thereof, as a Specified Hedge
Agreement.  The designation of any Hedge Agreement as a Specified
Hedge Agreement shall not create in favor of the Lender or Affiliate thereof
that is a party thereto any rights in connection with the management or release
of any Collateral or of the obligations of any Credit Party under the Collateral
Agreement or any Guaranty Agreement.




“Specified Hedge
Obligations” means all existing or future payment and other obligations
owing by any Credit Party or any Subsidiary thereof under any Specified Hedge
Agreement.




“Specified
Obligations” means, collectively, (a) all Specified Hedge Obligations and
(b) all Specified Cash Management Obligations.




“Subordinated
Indebtedness” means the collective reference to any Indebtedness of the
Borrower or any Subsidiary subordinated in right and time of payment to the
Obligations and containing such other terms and conditions, in each case as are
satisfactory to the Administrative Agent.




“Subsidiary” means as
to any Person, any corporation, partnership, limited liability company or other
entity of which more than fifty percent (50%) of the outstanding Capital Stock
having ordinary voting power to elect a majority of the board of directors or
other managers of such corporation, partnership, limited liability company or
other entity is at the time owned by or the management is otherwise controlled
by such Person (irrespective of whether, at the time, Capital Stock of any other
class or classes of such corporation, partnership, limited liability company or
other entity shall have or might have voting power by reason of the happening of
any contingency).  Unless otherwise qualified references to
“Subsidiary” or “Subsidiaries” herein shall refer to those of the
Borrower.




“Swingline Commitment”
means the lesser of (a) Ten Million Dollars ($10,000,000)and (b) the Aggregate
Commitment.




“Swingline Facility”
means the swingline facility established pursuant to Section
2.2.




“Swingline Lender”
means Wachovia in its capacity as swingline lender hereunder.




“Swingline Loan” means
any swingline loan made by the Swingline Lender to the Borrower pursuant to
Section 2.2,
and all such swingline loans collectively as the context requires.




“Swingline Note” means
a promissory note made by the Borrower in favor of the Swingline Lender
evidencing the Swingline Loans made by the Swingline Lender, substantially in
the form of Exhibit A-2 hereto,
and any amendments, supplements and modifications thereto, any substitutes
therefor, and any replacements, restatements, renewals or extension thereof, in
whole or in part




“Swingline Termination
Date” means the first to occur of (a) the resignation of Wachovia as
Administrative Agent in accordance with Section 12.9 and (b)
the Maturity Date.




“Synthetic Lease”
means any synthetic lease, tax retention operating lease, off-balance sheet loan
or similar off-balance sheet financing product where such transaction is
considered borrowed money indebtedness for tax purposes but is classified as an
Operating Lease in accordance with GAAP.




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




“Termination Event”
means except for any such event or condition that could not reasonably be
expected to have a Material Adverse Effect: (a) a “Reportable Event”
described in Section 4043 of ERISA for which the notice requirement has not been
waived by the PBGC, or (b) the withdrawal of the Borrower or any ERISA
Affiliate from a Pension Plan during a plan year in which it was a “substantial
employer” as defined in Section 4001(a)(2) of ERISA, or (c) the termination of a
Pension Plan, the filing of a notice of intent to terminate a Pension Plan or
the treatment of a Pension Plan amendment as a termination, under Section 4041
of ERISA, if the plan assets are not sufficient to pay all plan liabilities, or
(d) the institution of proceedings to terminate, or the appointment of a trustee
with respect to, any Pension Plan by the PBGC, or (e) any other event or
condition which would constitute grounds under Section 4042(a) of ERISA for the
termination of, or the appointment of a trustee to administer, any Pension Plan,
or (f) the imposition of a Lien pursuant to Section 412 of the Code or Section
302 of ERISA, or (g) the partial or complete withdrawal of the Borrower of
any ERISA Affiliate from a Multiemployer Plan if withdrawal liability is
asserted by such plan, or (h) any event or condition which results in the
reorganization or insolvency of a Multiemployer Plan under Sections 4241 or 4245
of ERISA, or (i) any event or condition which results in the termination of a
Multiemployer Plan under Section 4041A of ERISA or the institution by PBGC of
proceedings to terminate a Multiemployer Plan under Section 4042 of
ERISA.




“Termination Value”
means, in respect of any one or more Hedging Agreements, after taking into
account the effect of any legally enforceable netting agreement relating to such
Hedging Agreements, (a) for any date on or after the date such Hedging
Agreements have been closed out and termination value(s) determined in
accordance therewith, such termination value(s), and (b) for any date prior to
the date referenced in clause (a), the amount(s) determined as the
mark-to-market value(s) for such Hedging Agreements, as determined based upon
one or more mid-market or other readily available quotations provided by any
recognized dealer in such Hedging Agreements (which may include a Lender or any
Affiliate of a Lender).




“Total Indebtedness”
means, as of any date of determination with respect to the Borrower and its
Subsidiaries on a Consolidated basis without duplication, the sum of all
Indebtedness of the Borrower and its Subsidiaries.




“Total Leverage Ratio”
means, with respect to the Borrower and its Subsidiaries as of any date of
determination, the ratio of (a) Total Indebtedness as of such date to (b) EBITDA
for the period of four (4) consecutive fiscal quarters ending on or immediately
prior to such date.




“Trademark Security
Agreement” means that certain Trademark Security Agreement dated as of
the Closing Date by and between LMI-TCA, Inc. and the Administrative
Agent.




“Transactions” means
collectively, (a) the consummation of the Acquisition, (b) the entering into by
the Credit Parties and their applicable Subsidiaries of the Loan Documents and
the Related Documents to which they are or are intended to be a party, (c) the
refinancing of certain outstanding Indebtedness of the Borrower and its
Subsidiaries evidenced by the Existing Facilities and the termination of all
commitments with respect thereto and (d) the payment of the fees and expenses
incurred in connection with the consummation of the foregoing.




“Uniform Customs”
means the Uniform Customs and Practice for Documentary Credits (1993 Revision),
effective January, 1994 International Chamber of Commerce Publication No.
500.




“UCC” means the
Uniform Commercial Code as in effect in the State of New York or appropriate
governing state, as amended or modified from time to time.




“United States” means
the United States of America.




“Wachovia” means
Wachovia Bank, National Association, a national banking association, and its
successors.




“Wholly-Owned” means,
with respect to a Subsidiary, that all of the shares of Capital Stock of such
Subsidiary are, directly or indirectly, owned or controlled by the Borrower
and/or one or more of its Wholly-Owned Subsidiaries (except for directors’
qualifying shares or other shares required by Applicable Law to be owned by a
Person other than the Borrower).




Section
1.2  Other Definitions and
Provisions .  With
reference to this Agreement and each other Loan Document, unless otherwise
specified herein or in such other Loan Document:  (a) the definitions
of terms herein shall apply equally to the singular and plural forms of the
terms defined, (b) whenever the context may require, any pronoun shall include
the corresponding masculine, feminine and neuter forms, (c) the words “include”,
“includes” and “including” shall be deemed to be followed by the phrase “without
limitation”, (d) the word “will” shall be construed to have the same meaning and
effect as the word “shall”, (e) any definition of or reference to any agreement,
instrument or other document herein shall be construed as referring to such
agreement, instrument or other document as from time to time amended,
supplemented or otherwise modified (subject to any restrictions on such
amendments, supplements or modifications set forth herein), (f) any reference
herein to any Person shall be construed to include such Person’s successors and
assigns, (g) the words “herein”, “hereof” and “hereunder”, and words of similar
import, shall be construed to refer to this Agreement in its entirety and not to
any particular provision hereof, (h) all references herein to Articles,
Sections, Exhibits and Schedules shall be construed to refer to Articles and
Sections of, and Exhibits and Schedules to, this Agreement, (i) the words
“asset” and “property” shall be construed to have the same meaning and effect
and to refer to any and all tangible and intangible assets and properties,
including cash, securities, accounts and contract rights, (j) the term “documents” includes
any and all instruments, documents, agreements, certificates, notices, reports,
financial statements and other writings, however evidenced, whether in physical
or electronic form, (k) in the computation of periods of time from a specified
date to a later specified date, the word “from” means “from and including;” the
words “to” and “until” each mean “to but excluding;” and the word “through”
means “to and including”, and (l) Section headings herein and in the other Loan
Documents are included for convenience of reference only and shall not affect
the interpretation of this Agreement or any other Loan Document.




Section
1.3  Accounting
Terms .  All
accounting terms not specifically or completely defined herein shall be
construed in conformity with, and all financial data (including financial ratios
and other financial calculations) required to be submitted pursuant to this
Agreement shall be prepared in conformity with, GAAP applied on a consistent
basis, as in effect from time to time, applied in a manner consistent with that
used in preparing the audited financial statements required by Section 7.1(b), except as otherwise
specifically prescribed herein.




Section
1.4  UCC Terms .  Terms
defined in the UCC in effect on the Closing Date and not otherwise defined
herein shall, unless the context otherwise indicates, have the meanings provided
by those definitions.  Subject to the foregoing, the term “UCC” refers, as of
any date of determination, to the UCC then in effect.




Section
1.5  Rounding .  Any
financial ratios required to be maintained by the Borrower pursuant to this
Agreement shall be calculated by dividing the appropriate component by the other
component, carrying the result to one place more than the number of places by
which such ratio is expressed herein and rounding the result up or down to the
nearest number (with a rounding-up if there is no nearest number).




Section
1.6  References to Agreement and
Laws .  Unless
otherwise expressly provided herein, (a) references to formation documents,
governing documents, agreements (including the Loan Documents) and other
contractual instruments shall be deemed to include all subsequent amendments,
restatements, extensions, supplements and other modifications thereto, but only
to the extent that such amendments, restatements, extensions, supplements and
other modifications are not prohibited by any Loan Document; and (b) references
to any Applicable Law shall include all statutory and regulatory provisions
consolidating, amending, replacing, supplementing or interpreting such
Applicable Law.




Section
1.7  Times of
Day .  Unless
otherwise specified, all references herein to times of day shall be references
to Eastern time (daylight or standard, as applicable).




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




ARTICLE
II


REVOLVING CREDIT
FACILITY




Section
2.1  Revolving Credit
Loans .  Subject
to the terms and conditions of this Agreement and in reliance upon the
representations and warranties set forth herein, each Lender severally agrees to
make Revolving Credit Loans to the Borrower from time to time from the Closing
Date through, but not including, the Maturity Date as requested by the Borrower
in accordance with the terms of Section 2.3; provided, that (a)
the aggregate principal amount of all outstanding Revolving Credit Loans (after
giving effect to any amount requested) shall not exceed the Aggregate Commitment
less the sum of
all outstanding Swingline Loans and L/C Obligations and (b) the principal amount
of outstanding Revolving Credit Loans from any Lender to the Borrower shall not
at any time exceed such Lender’s Commitment less such Lender’s
Commitment Percentage of outstanding L/C Obligations and outstanding Swingline
Loans.  Each Revolving Credit Loan by a Lender shall be in a principal
amount equal to such Lender’s Commitment Percentage of the aggregate principal
amount of Revolving Credit Loans requested on such occasion.  Subject
to the terms and conditions hereof, the Borrower may borrow, repay and reborrow
Revolving Credit Loans hereunder until the Maturity Date.




Section
2.2  Swingline
Loans .




(a)  Availability.  Subject
to the terms and conditions of this Agreement, the Swingline Lender agrees to
make Swingline Loans to the Borrower from time to time from the Closing Date
through, but not including, the Swingline Termination Date; provided, that the
aggregate principal amount of all outstanding Swingline Loans (after giving
effect to any amount requested), shall not exceed the lesser of (i) the
Aggregate Commitment less the sum of all outstanding Revolving Credit Loans and
the L/C Obligations and (ii) the Swingline Commitment.




(b)  Refunding.




(i)  Swingline
Loans shall be refunded by the Lenders on demand by the Swingline
Lender.  Such refundings shall be made by the Lenders in accordance
with their respective Commitment Percentages and shall thereafter be reflected
as Revolving Credit Loans of the Lenders on the books and records of the
Administrative Agent.  Each Lender shall fund its respective
Commitment Percentage of Revolving Credit Loans as required to repay Swingline
Loans outstanding to the Swingline Lender upon demand by the Swingline Lender
but in no event later than 1:00 p.m. on the next succeeding Business Day after
such demand is made.  No Lender’s obligation to fund its respective
Commitment Percentage of a Swingline Loan shall be affected by any other
Lender’s failure to fund its Commitment Percentage of a Swingline Loan, nor
shall any Lender’s Commitment Percentage be increased as a result of any such
failure of any other Lender to fund its Commitment Percentage of a Swingline
Loan.




(ii)  The
Borrower shall pay to the Swingline Lender on demand the amount of such
Swingline Loans to the extent amounts received from the Lenders are not
sufficient to repay in full the outstanding Swingline Loans requested or
required to be refunded.  In addition, the Borrower hereby authorizes
the Administrative Agent to charge any account maintained by the Borrower with
the Swingline Lender (up to the amount available therein) in order to
immediately pay the Swingline Lender the amount of such Swingline Loans to the
extent amounts received from the Lenders are not sufficient to repay in full the
outstanding Swingline Loans requested or required to be refunded.  If
any portion of any such amount paid to the Swingline Lender shall be recovered
by or on behalf of the Borrower from the Swingline Lender in bankruptcy or
otherwise, the loss of the amount so recovered shall be ratably shared among all
the Lenders in accordance with their respective Commitment Percentages (unless
the amounts so recovered by or on behalf of the Borrower pertain to a Swingline
Loan extended after the occurrence and during the continuance of an Event of
Default of which the Administrative Agent has received notice in the manner
required pursuant to Section 12.5 and
which such Event of Default has not been waived by the Required Lenders or the
Lenders, as applicable).




(iii)  Each
Lender acknowledges and agrees that its obligation to refund Swingline Loans in
accordance with the terms of this Section is absolute and unconditional and
shall not be affected by any circumstance whatsoever, including, without
limitation, non-satisfaction of the conditions set forth in Article
V.  Further, each Lender agrees and acknowledges that if prior
to the refunding of any outstanding Swingline Loans pursuant to this Section, a
Bankruptcy Event of Default shall have occurred, each Lender will, on the date
the applicable Revolving Credit Loan would have been made, purchase an undivided
participating interest in the Swingline Loan to be refunded in an amount equal
to its Commitment Percentage of the aggregate amount of such Swingline
Loan.  Each Lender will immediately transfer to the Swingline Lender,
in immediately available funds, the amount of its participation and upon receipt
thereof the Swingline Lender will deliver to such Lender a certificate
evidencing such participation dated the date of receipt of such funds and for
such amount.  Whenever, at any time after the Swingline Lender has
received from any Lender such Lender’s participating interest in a Swingline
Loan, the Swingline Lender receives any payment on account thereof, the
Swingline Lender will distribute to such Lender its participating interest in
such amount (appropriately adjusted, in the case of interest payments, to
reflect the period of time during which such Lender’s participating interest was
outstanding and funded).




Section
2.3  Procedure for Advances of
Revolving Credit Loans and Swingline Loans .




(a)  Requests for
Borrowing.  The Borrower shall give the Administrative Agent
irrevocable prior written notice substantially in the form attached hereto as
Exhibit B (a “Notice of Borrowing”)
not later than 12:00 p.m. (i) on the same Business Day as each Base Rate Loan
and each Swingline Loan and (ii) at least three (3) Business Days before each
LIBOR Rate Loan, of its intention to borrow, specifying (A) the date of such
borrowing, which shall be a Business Day, (B) the amount of such borrowing,
which shall be, (x) with respect to Base Rate Loans (other than Swingline Loans)
in an aggregate principal amount of $1,000,000 or a whole multiple of $500,000
in excess thereof, (y) with respect to LIBOR Rate Loans in an aggregate
principal amount of $2,000,000 or a whole multiple of $500,000 in excess thereof
and (z) with respect to Swingline Loans in an aggregate principal amount of
$100,000 or a whole multiple of $50,000 in excess thereof, (C) whether such
Loan is to be a Revolving Credit Loan or Swingline Loan, (D) in the case of a
Revolving Credit Loan whether the Loans are to be LIBOR Rate Loans or Base Rate
Loans, and (E) in the case of a LIBOR Rate Loan, the duration of the Interest
Period applicable thereto.  A Notice of Borrowing received after 12:00
p.m. shall be deemed received on the next Business Day.  The
Administrative Agent shall promptly notify the Lenders of each Notice of
Borrowing.




(b)  Disbursement of Revolving
Credit and Swingline Loans.  Not later than 2:00 p.m. on the
proposed borrowing date, (i) each Lender will make available to the
Administrative Agent, for the account of the Borrower, at the office of the
Administrative Agent in funds immediately available to the Administrative Agent,
such Lender’s Commitment Percentage of the Revolving Credit Loans to be made on
such borrowing date and (ii) the Swingline Lender will make available to the
Administrative Agent, for the account of the Borrower, at the office of the
Administrative Agent in funds immediately available to the Administrative Agent,
the Swingline Loans to be made on such borrowing date.  The Borrower
hereby irrevocably authorizes the Administrative Agent to disburse the proceeds
of each borrowing requested pursuant to this Section in immediately available
funds by crediting or wiring such proceeds to the deposit account of the
Borrower identified in the most recent notice substantially in the form of Exhibit C hereto (a
“Notice of Account
Designation”) delivered by the Borrower to the Administrative Agent or as
may be otherwise agreed upon by the Borrower and the Administrative Agent from
time to time.  Subject to Section 4.7 hereof,
the Administrative Agent shall not be obligated to disburse the portion of the
proceeds of any Revolving Credit Loan requested pursuant to this Section to the
extent that any Lender has not made available to the Administrative Agent its
Commitment Percentage of such Loan.  Revolving Credit Loans to be made
for the purpose of refunding Swingline Loans shall be made by the Lenders as
provided in Section
2.2(b).




Section
2.4  Repayment of
Loans .




(a)  Repayment on Maturity
Date.  The Borrower hereby agrees to repay the outstanding
principal amount of (i) all Revolving Credit Loans in full on the Maturity Date,
and (ii) all Swingline Loans in accordance with Section 2.2(b),
together, in each case, with all accrued but unpaid interest
thereon.




(b)  Mandatory Repayment of
Revolving Credit Loans.  If at any time the outstanding
principal amount of all Revolving Credit Loans plus the sum of all
outstanding Swingline Loans and L/C Obligations exceeds the Aggregate
Commitment, the Borrower agrees to repay immediately upon notice from the
Administrative Agent, by payment to the Administrative Agent for the account of
the Lenders, Extensions of Credit in an amount equal to such excess with each
such repayment applied first to the
principal amount of outstanding Swingline Loans, second to the
principal amount of outstanding Revolving Credit Loans and third, with respect
to any Letters of Credit then outstanding, a payment of cash collateral into a
cash collateral account opened by the Administrative Agent, for the benefit of
the Lenders in an amount equal to the aggregate then undrawn and unexpired
amount of such Letters of Credit (such cash collateral to be applied in
accordance with Section
11.2(b)).




(c)  Optional
Prepayments.  The Borrower may at any time and from time to
time prepay without premium or penalty, but including any amount required to be
paid pursuant to Section 4.9,
Revolving Credit Loans and Swingline Loans, in whole or in part, with
irrevocable prior written notice to the Administrative Agent substantially in
the form attached hereto as Exhibit D (a
“Notice of
Prepayment”) given not later than 11:00 a.m. (i) on the same
Business Day as each Base Rate Loan and each Swingline Loan and (ii) at
least three (3) Business Days before each LIBOR Rate Loan, specifying the date
and amount of prepayment and whether the prepayment is of LIBOR Rate Loans, Base
Rate Loans, Swingline Loans or a combination thereof, and, if of a combination
thereof, the amount allocable to each.  Upon receipt of such notice,
the Administrative Agent shall promptly notify each Lender.  If any
such notice is given, the amount specified in such notice shall be due and
payable on the date set forth in such notice.  Partial prepayments
shall be in an aggregate amount of $1,000,000 or a whole multiple of $500,000 in
excess thereof with respect to Base Rate Loans (other than Swingline Loans),
$2,000,000 or a whole multiple of $500,000 in excess thereof with respect to
LIBOR Rate Loans and $100,000 or a whole multiple of $50,000 in excess thereof
with respect to Swingline Loans.  A Notice of Prepayment received
after 11:00 a.m. shall be deemed received on the next Business
Day.  Each such repayment shall be accompanied by any amount required
to be paid pursuant to Section
4.9.




(d)  Limitation on Prepayment of
LIBOR Rate Loans.  The Borrower may not prepay any LIBOR Rate
Loan on any day other than on the last day of the Interest Period applicable
thereto unless such prepayment is accompanied by any amount required to be paid
pursuant to Section
4.9.




(e)  Hedging Agreements and
Specified Cash Management Arrangements.  No repayment or
prepayment pursuant to this Section shall affect any of the Borrower’s
obligations under any Hedging Agreement or any Specified Cash Management
Arrangement.




Section
2.5  Permanent Reduction of the
Aggregate Credit Commitment .




(a)  Voluntary
Reduction.  The Borrower shall have the right at any time and
from time to time, upon at least five (5) Business Days prior written notice to
the Administrative Agent, to permanently reduce, without premium or penalty but
including any amount required to be paid pursuant to Section 4.9, (i) the
entire Aggregate Commitment at any time or (ii) portions of the Aggregate
Commitment, from time to time, in an aggregate principal amount of not less than
$1,000,000 or any whole multiple of $500,000 in excess thereof.  Any
reduction of the Aggregate Commitment shall be applied to the Commitment of each
Lender according to its Commitment Percentage.  All commitment fees
accrued until the effective date of any termination of the Aggregate Commitment
shall be paid on the effective date of such termination.




(b)  Corresponding
Payment.  Each permanent reduction permitted pursuant to this
Section shall be accompanied by a payment of principal sufficient to reduce the
aggregate outstanding Revolving Credit Loans, Swingline Loans and L/C
Obligations, as applicable, after such reduction to the Aggregate Commitment as
so reduced and if the Aggregate Commitment as so reduced is less than the
aggregate amount of all outstanding Letters of Credit, the Borrower shall be
required to deposit cash collateral in a cash collateral account opened by the
Administrative Agent in an amount equal to the aggregate then undrawn and
unexpired amount of such Letters of Credit.  Such cash collateral
shall be applied in accordance with Section
11.2(b).  Any reduction of the Aggregate Commitment to zero
shall be accompanied by payment of all outstanding Revolving Credit Loans and
Swingline Loans (and furnishing of cash collateral satisfactory to the
Administrative Agent for all L/C Obligations) and shall result in the
termination of the Commitments and the Revolving Credit
Facility.  Such cash collateral shall be applied in accordance with
Section
11.2(b).  If the reduction of the Aggregate Commitment requires
the repayment of any LIBOR Rate Loan, such repayment shall be accompanied by any
amount required to be paid pursuant to Section
4.9.




Section
2.6  Termination of Revolving
Credit Facility .  The
Revolving Credit Facility shall terminate on the Maturity Date.




Section
2.7  Increase in Aggregate
Commitment .




(a)  Request for
Increase.  Provided there exists no Default or Event of Default
immediately prior to or after giving effect thereto, upon notice to the
Administrative Agent (which shall promptly notify the Lenders), the Borrower
may, at any time during the period from the Closing Date through July 31, 2010,
request an increase in the Aggregate Commitment by an amount (for all such
requests) not exceeding $40,000,000; provided that (i) any
such request for an increase shall be in a minimum amount of $10,000,000, and
(ii) the Borrower may make a maximum of two such requests.  At the
time of sending such notice, the Borrower (in consultation with the
Administrative Agent) shall specify the time period within which each Lender is
requested to respond (which shall in no event be less than ten (10) Business
Days from the date of delivery of such notice to the Lenders).




(b)  Lender Elections to
Increase.  Each Lender shall notify the Administrative Agent
within such time period whether or not it agrees to increase its Commitment and,
if so, whether by an amount equal to, greater than, or less than its Commitment
Percentage of such requested increase.  Any Lender not responding
within such time period shall be deemed to have declined to increase its
Commitment.




(c)  Notification by
Administrative Agent; Additional Lenders.  The Administrative
Agent shall notify the Borrower and each Lender of the Lenders’ responses to
each request made hereunder.  To achieve the full amount of a
requested increase, and subject to the approval of the Administrative Agent,
each Issuing Lender and the Swingline Lender (which approvals shall not be
unreasonably withheld), the Borrower may also invite additional Eligible
Assignees to become Lenders pursuant to a joinder agreement in form and
substance satisfactory to the Administrative Agent and its counsel.




(d)  Effective Date and
Allocations.  If the Aggregate Commitment is increased in
accordance with this Section, the Administrative Agent and the Borrower shall
determine the effective date (the “Increase Effective
Date”) and the final allocation of such increase.  The
Administrative Agent shall promptly notify the Borrower and the Lenders of the
final allocation of such increase and the Increase Effective Date.




(e)  Conditions to Effectiveness
of Increase.  As a condition precedent to such increase, the
Borrower shall deliver to the Administrative Agent a certificate of each Credit
Party dated as of the Increase Effective Date signed by a Responsible Officer of
such Credit Party (i) certifying and attaching the resolutions adopted by such
Credit Party approving or consenting to such increase, and (ii) in the case of
the Borrower, certifying that, before and after giving effect to such increase,
no Default or Event of Default exists and is continuing.  Upon the
Increase Effective Date, (A) the Aggregate Commitment will be deemed to have
been increased by the amount of such Commitment increase pursuant to this Section 2.7, (B)
entries in the Register will be revised to reflect the revised Commitments and
Commitment Percentages of each of the Lenders (including each new Lender) and
(C) the outstanding Loans will be reallocated on the effective date of such
increase among the Lenders in accordance with their revised Commitment
Percentages and the Lenders (including each new Lender) agree to make all
payments and adjustments necessary to effect such reallocation and the Borrower
shall pay any and all costs required pursuant to Section 4.9 in
connection with such reallocation as if such reallocation were a repayment;
provided, that
the Administrative Agent agrees to cooperate with the Borrower with respect to
the timing of such reallocation so as to minimize any incurrence by the Borrower
of costs required pursuant to Section
4.9.




(f)  Conflicting
Provisions.  This Section shall supersede any provisions in
Section 4.6 or
13.2 to the
contrary.




ARTICLE
III


LETTER OF CREDIT
FACILITY




Section
3.1  L/C
Commitment .  Subject
to the terms and conditions hereof, the Issuing Lenders, in reliance on the
agreements of the other Lenders set forth in Section 3.4(a), agree
to issue standby letters of credit (“Letters of Credit”)
for the account of the Borrower on any Business Day from the Closing Date
through but not including the Revolving Credit Maturity Date in such form as may
be approved from time to time by the applicable Issuing Lender; provided, that no
Issuing Lender shall have any obligation to issue any Letter of Credit if, after
giving effect to such issuance, (a) the L/C Obligations would exceed the L/C
Commitment or (b) the aggregate principal amount of outstanding Revolving Credit
Loans, plus the
aggregate principal amount of outstanding Swingline Loans, plus the aggregate
amount of L/C Obligations would exceed the Aggregate Commitment.  Each
Letter of Credit shall (i) be denominated in Dollars in a minimum amount of
$100,000 (or such lesser amount as may be agreed by the Administrative Agent),
(ii) be a standby letter of credit issued to support obligations of the Borrower
or any of its Subsidiaries, contingent or otherwise, incurred in the ordinary
course of business, (iii) expire no later than the earlier of: (A) one (1) year
after its date of issuance or (B) the fifth (5th) Business Day prior to the
Maturity Date and (iv) be subject to the Uniform Customs and/or ISP98, as set
forth in the Letter of Credit Application or as determined by the applicable
Issuing Lender and, to the extent not inconsistent therewith, the laws of the
State of New York.  No Issuing Lender shall at any time be obligated
to issue any Letter of Credit hereunder if such issuance would conflict with, or
cause such Issuing Lender or any L/C Participant to exceed any limits imposed
by, any Applicable Law.  References herein to “issue” and derivations
thereof with respect to Letters of Credit shall also include extensions or
modifications of any existing Letters of Credit, unless the context otherwise
requires.Notwithstanding the
foregoing, as of the Closing Date, each of the Existing Letters of Credit shall
constitute, for all purposes of this Agreement and the other Loan Documents, a
Letter of Credit issued and outstanding hereunder.




Section
3.2  Procedure for Issuance of
Letters of Credit .  The
Borrower may from time to time request that the applicable Issuing Lender issue
a Letter of Credit by delivering to the applicable Issuing Lender a Letter of
Credit Application therefor, completed to the satisfaction of such Issuing
Lender, and such other certificates, documents and other papers and information
as such Issuing Lender and the Administrative Agent may request.  The
Borrower will contemporaneously deliver to the Administrative Agent, at the
Administrative Agent’s Office, a copy of such Letter of Credit Application and
accompanying documentation. Upon receipt of any Letter of Credit Application,
the applicable Issuing Lender shall process such Letter of Credit Application
and the certificates, documents and other papers and information delivered to it
in connection therewith in accordance with its customary procedures and shall,
after approving same and receiving confirmation from the Administrative Agent
that sufficient availability exists under the Revolving Credit Facility for the
issuance of such Letter of Credit, subject to Section 3.1 and Article V, promptly
issue the Letter of Credit requested thereby (but in no event shall the Issuing
Lender be required to issue any Letter of Credit earlier than four (4) Business
Days after its receipt of the Letter of Credit Application therefor and all such
other certificates, documents and other papers and information relating thereto)
by issuing the original of such Letter of Credit to the beneficiary thereof or
as otherwise may be agreed by the applicable Issuing Lender and the
Borrower.  The applicable Issuing Lender shall promptly furnish to the
Borrower and the Administrative Agent a copy of such Letter of Credit and
promptly notify each Lender of the issuance and upon request by any Lender,
furnish to such Lender a copy of such Letter of Credit and the amount of such
Lender’s participation therein.




Section
3.3  Commissions and Other
Charges .




(a)  Letter of Credit
Commissions.  The Borrower shall pay to the Administrative
Agent, for the account of the applicable Issuing Lender and the L/C
Participants, a letter of credit commission with respect to each Letter of
Credit in an amount equal to the face amount of such Letter of Credit multiplied by the
Applicable Margin with respect to LIBOR Rate Loans (determined on a per annum
basis).  Such commission shall be payable quarterly in arrears on the
last Business Day of each calendar quarter, on the Maturity Date and thereafter
on demand of the Administrative Agent.  The Administrative Agent
shall, promptly following its receipt thereof, distribute to the applicable
Issuing Lender and the L/C Participants all commissions received pursuant to
this Section in accordance with their respective Commitment
Percentages.




(b)  Fronting
Fee.  In addition to the foregoing commission, the Borrower
shall pay to the Administrative Agent, for the account of the applicable Issuing
Lender, a fronting fee with respect to each Letter of Credit in an amount equal
to the face amount of such Letter of Credit multiplied by one-eighth of one
percent (0.125%) per annum.  Such fronting fee shall be payable
quarterly in arrears on the last Business Day of each calendar quarter
commencing with the first such date to occur after the issuance of such Letter
of Credit, on the Maturity Date and thereafter on demand of the Administrative
Agent.




(c)  Other
Costs.  In addition to the foregoing fees and commissions, the
Borrower shall pay or reimburse the applicable Issuing Lender for such normal
and customary costs and expenses as are incurred or charged by the applicable
Issuing Lender in issuing, effecting payment under, amending or otherwise
administering any Letter of Credit.




Section
3.4  L/C
Participations .




(a)  Each
Issuing Lender irrevocably agrees to grant and hereby grants to each L/C
Participant, and, to induce such Issuing Lender to issue Letters of Credit
hereunder, each L/C Participant irrevocably agrees to accept and purchase and
hereby accepts and purchases from such Issuing Lender, on the terms and
conditions hereinafter stated, for such L/C Participant’s own account and risk
an undivided interest equal to such L/C Participant’s Commitment Percentage in
such Issuing Lender’s obligations and rights under and in respect of each Letter
of Credit issued hereunder and the amount of each draft paid by such Issuing
Lender thereunder.  Each L/C Participant unconditionally and
irrevocably agrees with each Issuing Lender that, if a draft is paid under any
Letter of Credit for which such Issuing Lender is not reimbursed in full by the
Borrower through a Revolving Credit Loan or otherwise in accordance with the
terms of this Agreement, such L/C Participant shall pay to such Issuing Lender
upon demand at such Issuing Lender’s address for notices specified herein an
amount equal to such L/C Participant’s Commitment Percentage of the amount of
such draft, or any part thereof, which is not so reimbursed.




(b)  Upon
becoming aware of any amount required to be paid by any L/C Participant to the
applicable Issuing Lender pursuant to Section 3.4(a)
in respect of any unreimbursed portion of any payment made by such Issuing
Lender under any Letter of Credit, such Issuing Lender shall notify each L/C
Participant of the amount and due date of such required payment and such L/C
Participant shall pay to such Issuing Lender the amount specified on the
applicable due date.  If any such amount is paid to such Issuing
Lender after the date such payment is due, such L/C Participant shall pay to
such Issuing Lender on demand, in addition to such amount, the product of (i)
such amount, times (ii) the daily
average Federal Funds Rate as determined by the Administrative Agent during the
period from and including the date such payment is due to the date on which such
payment is immediately available to such Issuing Lender, times (iii) a
fraction the numerator of which is the number of days that elapse during such
period and the denominator of which is 360.  A certificate of such
Issuing Lender with respect to any amounts owing under this Section shall be
conclusive in the absence of manifest error.  With respect to payment
to such Issuing Lender of the unreimbursed amounts described in this Section, if
the L/C Participants receive notice that any such payment is due (A) prior to
1:00 p.m. on any Business Day, such payment shall be due that Business Day, and
(B) after 1:00 p.m. on any Business Day, such payment shall be due on the
following Business Day.




(c)  Whenever,
at any time after any Issuing Lender has made payment under any Letter of Credit
and has received from any L/C Participant its Commitment Percentage of such
payment in accordance with this Section, such Issuing Lender receives any
payment related to such Letter of Credit (whether directly from the Borrower or
otherwise, or any payment of interest on account thereof, such Issuing Lender
will distribute to such L/C Participant its prorata share thereof;
provided, that
in the event that any such payment received by such Issuing Lender shall be
required to be returned by such Issuing Lender, such L/C Participant shall
return to such Issuing Lender the portion thereof previously distributed by such
Issuing Lender to it.




Section
3.5  Reimbursement Obligation of
the Borrower .  In
the event of any drawing under any Letter of Credit, the Borrower agrees to
reimburse (either with the proceeds of a Revolving Credit Loan as provided for
in this Section or with funds from other sources), in same day funds, the
applicable Issuing Lender on each date on which such Issuing Lender notifies the
Borrower of the date and amount of a draft paid under any Letter of Credit for
the amount of (a) such draft so paid and (b) any amounts referred to in Section 3.3(c)
incurred by such Issuing Lender in connection with such
payment.  Unless the Borrower shall immediately notify such Issuing
Lender that the Borrower intends to reimburse such Issuing Lender for such
drawing from other sources or funds, the Borrower shall be deemed to have timely
given a Notice of Borrowing to the Administrative Agent requesting that the
Lenders make a Revolving Credit Loan bearing interest at the Base Rate on such
date in the amount of (a) such draft so paid and (b) any amounts referred to in
Section 3.3(c)
incurred by such Issuing Lender in connection with such payment, and the Lenders
shall make a Revolving Credit Loan bearing interest at the Base Rate in such
amount, the proceeds of which shall be applied to reimburse the Issuing Lender
for the amount of the related drawing and costs and expenses. Each Lender
acknowledges and agrees that its obligation to fund a Revolving Credit Loan in
accordance with this Section to reimburse the Issuing Lender for any draft paid
under a Letter of Credit is absolute and unconditional and shall not be affected
by any circumstance whatsoever, including, without limitation, non-satisfaction
of the conditions set forth in Section 2.3(a) or
Article
V.  If the Borrower has elected to pay the amount of such
drawing with funds from other sources and shall fail to reimburse the Issuing
Lender as provided above, the unreimbursed amount of such drawing shall bear
interest at the rate which would be payable on any outstanding Base Rate Loans
which were then overdue from the date such amounts become payable (whether at
stated maturity, by acceleration or otherwise) until payment in
full.




Section
3.6  Obligations
Absolute .  The
Borrower’s obligations under this Article III
(including, without limitation, the Reimbursement Obligation) shall be absolute
and unconditional under any and all circumstances and irrespective of any
set-off, counterclaim or defense to payment which the Borrower may have or have
had against the applicable Issuing Lender or any beneficiary of a Letter of
Credit or any other Person.  The Borrower also agrees that the Issuing
Lenders, the Administrative Agent and the L/C Participants shall not be
responsible for, and the Borrower’s Reimbursement Obligation under Section 3.5 shall not
be affected by, among other things, the validity or genuineness of documents or
of any endorsements thereon, even though such documents shall in fact prove to
be invalid, fraudulent or forged, or any dispute between or among the Borrower
and any beneficiary of any Letter of Credit or any other party to which such
Letter of Credit may be transferred or any claims whatsoever of the Borrower
against any beneficiary of such Letter of Credit or any such
transferee.  No Issuing Lender shall be liable for any error,
omission, interruption or delay in transmission, dispatch or delivery of any
message or advice, however transmitted, in connection with any Letter of Credit,
except for errors or omissions caused by such Issuing Lender’s gross negligence
or willful misconduct.  The Borrower agrees that any action taken or
omitted by the Issuing Lender under or in connection with any Letter of Credit
or the related drafts or documents, if done in the absence of gross negligence
or willful misconduct, shall be binding on the Borrower and shall not result in
any liability of the Issuing Lender or any L/C Participant to the
Borrower.  The responsibility of the Issuing Lenders to the Borrower
in connection with any draft presented for payment under any Letter of Credit
shall, in addition to any payment obligation expressly provided for in such
Letter of Credit, be limited to determining that the documents (including each
draft) delivered under such Letter of Credit in connection with such presentment
are in conformity with such Letter of Credit.




Section
3.7  Effect of Letter of Credit
Application .  To
the extent that any provision of any Letter of Credit Application related to any
Letter of Credit is inconsistent with the provisions of this Article III, the
provisions of this Article III shall
apply.




ARTICLE
IV


GENERAL LOAN
PROVISIONS




Section
4.1  Interest .




(a)  Interest Rate
Options.  Subject to the provisions of this Section, at the
election of the Borrower, (i) Revolving Credit Loans shall bear interest at (A)
the Base Rate plus the Applicable
Margin or (B) the LIBOR Rate plus the Applicable
Margin (provided that the
LIBOR Rate shall not be available until three (3) Business Days after the
Closing Date unless the Borrower has delivered to the Administrative Agent a
letter in form and substance reasonably satisfactory to the Administrative Agent
indemnifying the Lenders in the manner set forth in Section 4.9 of this
Agreement) and (ii) Swingline Loans shall bear interest at the Base Rate plus the Applicable
Margin.  The Borrower shall select the rate of interest and Interest
Period, if any, applicable to any Revolving Credit Loan at the time a Notice of
Borrowing is given or at the time a Notice of Conversion/Continuation is given
pursuant to Section
4.2.  Any Revolving Credit Loan or any portion thereof as to
which the Borrower has not duly specified an interest rate as provided herein
shall be deemed a Base Rate Loan.




(b)  Interest
Periods.  In connection with each LIBOR Rate Loan, the
Borrower, by giving notice at the times described in Section 2.3 or 4.2, as applicable,
shall elect an interest period (each, an “Interest Period”) to
be applicable to such Loan, which Interest Period shall be a period of one (1),
two (2), three (3), or six (6) months; provided
that:




(i)  the
Interest Period shall commence on the date of advance of or conversion to any
LIBOR Rate Loan and, in the case of immediately successive Interest Periods,
each successive Interest Period shall commence on the date on which the
immediately preceding Interest Period expires;




(ii)  if any
Interest Period would otherwise expire on a day that is not a Business Day, such
Interest Period shall expire on the next succeeding Business Day; provided, that if any
Interest Period with respect to a LIBOR Rate Loan would otherwise expire on a
day that is not a Business Day but is a day of the month after which no further
Business Day occurs in such month, such Interest Period shall expire on the
immediately preceding Business Day;




(iii)  any
Interest Period with respect to a LIBOR Rate Loan that begins on the last
Business Day of a calendar month (or on a day for which there is no numerically
corresponding day in the calendar month at the end of such Interest Period)
shall end on the last Business Day of the relevant calendar month at the end of
such Interest Period;




(iv)  no
Interest Period shall extend beyond the Maturity Date; and




(v)  there
shall be no more than ten (10) Interest Periods in effect at any
time.




(c)  Default
Rate.  Subject to Section 11.3, upon
the occurrence and during the continuance of a Payment Event of Default or a
Bankruptcy Event of Default or, at the discretion of the Administrative Agent or
as directed by the Required Lenders, upon the occurrence and during the
continuance of an Event of Default other than a Payment Event of Default or
Bankruptcy Event of Default, (i) the Borrower shall no longer have the option to
request LIBOR Rate Loans, Swingline Loans or Letters of Credit, (ii) all
outstanding LIBOR Rate Loans shall bear interest at a rate per annum of two
percent (2%) in excess of the rate then applicable to LIBOR Rate Loans until the
end of the applicable Interest Period and thereafter at a rate equal to two
percent (2%) in excess of the rate then applicable to Base Rate Loans, and (iii)
all outstanding Base Rate Loans and other Obligations arising hereunder or under
any other Loan Document shall bear interest at a rate per annum equal to two
percent (2%) in excess of the rate then applicable to Base Rate Loans or such
other Obligations arising hereunder or under any other Loan
Document.  Interest shall continue to accrue on the Obligations after
the filing by or against the Borrower of any petition seeking any relief in
bankruptcy or under any act or law pertaining to insolvency or debtor relief,
whether state, federal or foreign.




(d)  Interest Payment and
Computation.  Interest on each Base Rate Loan shall be due and
payable in arrears on the last Business Day of each calendar quarter commencing
September 30, 2007; and interest on each LIBOR Rate Loan shall be due and
payable on the last day of each Interest Period applicable thereto, and if such
Interest Period extends over three (3) months, at the end of each three (3)
month interval during such Interest Period.  All computations of
interest for Base Rate Loans when the Base Rate is determined by the Prime Rate
shall be made on the basis of a year of 365 or 366 days, as the case may be, and
actual days elapsed.  All other computations of fees and interest
provided hereunder shall be made on the basis of a 360-day year and actual days
elapsed (which results in more fees or interest, as applicable, being paid than
if computed on the basis of a 365-day year).




(e)  Maximum
Rate.  In no contingency or event whatsoever shall the
aggregate of all amounts deemed interest under this Agreement charged or
collected pursuant to the terms of this Agreement exceed the highest rate
permissible under any Applicable Law which a court of competent jurisdiction
shall, in a final determination, deem applicable hereto.  In the event
that such a court determines that the Lenders have charged or received interest
hereunder in excess of the highest applicable rate, the rate in effect hereunder
shall automatically be reduced to the maximum rate permitted by Applicable Law
and the Lenders shall at the Administrative Agent’s option (i) promptly refund
to the Borrower any interest received by the Lenders in excess of the maximum
lawful rate or (ii) apply such excess to the principal balance of the
Obligations on a pro
rata basis.  It is the intent hereof that the Borrower not pay
or contract to pay, and that neither the Administrative Agent nor any Lender
receive or contract to receive, directly or indirectly in any manner whatsoever,
interest in excess of that which may be paid by the Borrower under Applicable
Law.




Section
4.2  Notice and Manner of
Conversion or Continuation of Loans .  Provided
that no Default or Event of Default has occurred and is then continuing, the
Borrower shall have the option to (a) convert at any time following the third
Business Day after the Closing Date all or any portion of any outstanding Base
Rate Loans (other than Swingline Loans) in a principal amount equal to
$2,000,000 or any whole multiple of $500,000 in excess thereof into one or more
LIBOR Rate Loans and (b) upon the expiration of any Interest Period, (i) convert
all or any part of its outstanding LIBOR Rate Loans in a principal amount equal
to $1,000,000 or a whole multiple of $500,000 in excess thereof into Base Rate
Loans (other than Swingline Loans) or (ii) continue such LIBOR Rate Loans as
LIBOR Rate Loans.  Whenever the Borrower desires to convert or
continue Loans as provided above, the Borrower shall give the Administrative
Agent irrevocable prior written notice in the form attached as Exhibit E (a “Notice of
Conversion/Continuation”) not later than 2:00 p.m. three (3) Business
Days before the day on which a proposed conversion or continuation of such Loan
is to be effective specifying (A) the Loans to be converted or continued, and,
in the case of any LIBOR Rate Loan to be converted or continued, the last day of
the Interest Period therefor, (B) the effective date of such conversion or
continuation (which shall be a Business Day), (C) the principal amount of such
Loans to be converted or continued, and (D) the Interest Period to be applicable
to such converted or continued LIBOR Rate Loan.  The Administrative
Agent shall promptly notify the Lenders of such Notice of
Conversion/Continuation.




Section
4.3  Fees .




(a)  Commitment
Fee.  Commencing on the Closing Date, the Borrower shall pay to
the Administrative Agent, for the account of the Lenders, a non-refundable
commitment fee at a rate per annum equal to the Applicable Margin (with such
determination on the Closing Date to be made after giving proforma effect to the
Transactions) on the average daily unused portion of the Aggregate Commitment;
provided, that
the amount of outstanding Swingline Loans shall not be considered usage of the
Aggregate Commitment for the purpose of calculating such commitment
fee.  The commitment fee shall be payable in arrears on the last
Business Day of each calendar quarter during the term of this Agreement
commencing September 30, 2007, and on the Maturity Date.  Such
commitment fee shall be distributed by the Administrative Agent to the Lenders
prorata in accordance
with the Lenders’ respective Commitment Percentages.




(b)  Administrative Agent’s and
Other Fees.  In order to compensate the Administrative Agent
for structuring and syndicating the Loans and for its obligations hereunder, the
Borrower agrees to pay to the Administrative Agent and its affiliates the fees
set forth in the Fee Letter.




(c)  Other
Fees.  In order to compensate the Lenders for entering into
this Agreement and making the Extensions of Credit  hereunder, the
Borrower agrees to pay to the Administrative Agent and its affiliates, for the
account of the Lenders, the fees set forth in the Fee Letter.




Section
4.4  Manner of
Payment .  Each
payment by the Borrower on account of the principal of or interest on the Loans
or of any fee, commission or other amounts (including the Reimbursement
Obligation) payable to the Lenders under this Agreement shall be made not later
than 1:00 p.m. on the date specified for payment under this Agreement to the
Administrative Agent at the Administrative Agent’s Office for the account of the
Lenders (other than as set forth below) prorata in accordance
with their respective Commitment Percentages (except as specified below), in
Dollars, in immediately available funds and shall be made without any set-off,
counterclaim or deduction whatsoever.  Any payment received after such
time but before 2:00 p.m. on such day shall be deemed a payment on such date for
the purposes of Section 11.1, but for
all other purposes shall be deemed to have been made on the next succeeding
Business Day.  Any payment received after 2:00 p.m. shall be deemed to
have been made on the next succeeding Business Day for all
purposes.  Upon receipt by the Administrative Agent of each such
payment, the Administrative Agent shall distribute to each Lender at its address
for notices set forth herein its prorata share of such
payment in accordance with such Lender’s Commitment Percentage (except as
specified below) and shall wire advice of the amount of such credit to each
Lender.  Each payment to the Administrative Agent on account of the
principal of, or interest on, the Swingline Loans or of any fee, commission or
other amount payable to the Swingline Lenders shall be made in like manner, but
for the account of the Swingline Lender.  Each payment to the
Administrative Agent of the applicable Issuing Lender’s fees or L/C
Participants’ commissions shall be made in like manner, but for the account of
the applicable Issuing Lender or the L/C Participants, as the case may
be.  Each payment to the Administrative Agent of Administrative
Agent’s fees or expenses shall be made for the account of the Administrative
Agent and any amount payable to any Lender under Sections 4.9, 4.10, 4.11 or 13.3 shall be paid to
the Administrative Agent for the account of the applicable
Lender.  Subject to Section 4.1(b)(ii) if
any payment under this Agreement shall be specified to be made upon a day which
is not a Business Day, it shall be made on the next succeeding day which is a
Business Day and such extension of time shall in such case be included in
computing any interest if payable along with such payment.




Section
4.5  Evidence of
Indebtedness .




(a)  Extensions of
Credit.  The Extensions of Credit made by each Lender shall be
evidenced by one or more accounts or records maintained by such Lender and by
the Administrative Agent in the ordinary course of business.  The
accounts or records maintained by the Administrative Agent and each Lender shall
be conclusive absent manifest error of the amount of the Extensions of Credit
made by the Lenders to the Borrower and the interest and payments
thereon.  Any failure to so record or any error in doing so shall not,
however, limit or otherwise affect the obligation of the Borrower hereunder to
pay any amount owing with respect to the Obligations.  In the event of
any conflict between the accounts and records maintained by any Lender and the
accounts and records of the Administrative Agent in respect of such matters, the
accounts and records of the Administrative Agent shall control in the absence of
manifest error.  Upon the request of any Lender made through the
Administrative Agent, the Borrower shall execute and deliver to such Lender
(through the Administrative Agent) a Revolving Credit Note and/or Swingline
Note, as applicable, which shall evidence such Lender’s Revolving Credit Loans
and/or Swingline Loans, as applicable, in addition to such accounts or
records.  Each Lender may attach schedules to its Notes and endorse
thereon the date, amount and maturity of its Loans and payments with respect
thereto.




(b)  Participations.  In
addition to the accounts and records referred to in subsection (a), each Lender
and the Administrative Agent shall maintain in accordance with its usual
practice accounts or records evidencing the purchases and sales by such Lender
of participations in Letters of Credit and Swingline Loans.  In the
event of any conflict between the accounts and records maintained by the
Administrative Agent and the accounts and records of any Lender in respect of
such matters, the accounts and records of the Administrative Agent shall control
in the absence of manifest error.




Section
4.6  Adjustments .  If
any Lender shall, by exercising any right of setoff or counterclaim or
otherwise, obtain payment in respect of any principal of or interest on any of
its Loans or other obligations hereunder resulting in such Lender’s receiving
payment of a proportion of the aggregate amount of its Loans and accrued
interest thereon or other such obligations (other than pursuant to Sections 4.9, 4.10, 4.11 or 13.3 hereof) greater
than its prorata share thereof as
provided herein, then the Lender receiving such greater proportion shall (a)
notify the Administrative Agent of such fact, and (b) purchase (for cash at face
value) participations in the Loans and such other obligations of the other
Lenders, or make such other adjustments as shall be equitable, so that the
benefit of all such payments shall be shared by the Lenders ratably in
accordance with the aggregate amount of principal of and accrued interest on
their respective Loans and other amounts owing them; provided
that




(i)  if any
such participations are purchased and all or any portion of the payment giving
rise thereto is recovered, such participations shall be rescinded and the
purchase price restored to the extent of such recovery, without interest,
and




(ii)  the
provisions of this paragraph shall not be construed to apply to (A) any payment
made by the Borrower pursuant to and in accordance with the express terms of
this Agreement or (B) any payment obtained by a Lender as consideration for the
assignment of or sale of a participation in any of its Loans or participations
in Swingline Loans and Letters of Credit to any assignee or participant, other
than to the Borrower or any Subsidiary thereof (as to which the provisions of
this paragraph shall apply).




Each
Credit Party consents to the foregoing and agrees, to the extent it may
effectively do so under applicable law, that any Lender acquiring a
participation pursuant to the foregoing arrangements may exercise against each
Credit Party rights of setoff and counterclaim with respect to such
participation as fully as if such Lender were a direct creditor of each Credit
Party in the amount of such participation.




Section
4.7  Nature of Obligations of
Lenders Regarding Extensions of Credit; Assumption by the Administrative
Agent .  The
obligations of the Lenders under this Agreement to make the Loans and issue or
participate in Letters of Credit are several and are not joint or joint and
several.  Unless the Administrative Agent shall have received notice
from a Lender prior to a proposed borrowing date that such Lender will not make
available to the Administrative Agent such Lender’s ratable portion of the
amount to be borrowed on such date (which notice shall not release such Lender
of its obligations hereunder), the Administrative Agent may assume that such
Lender has made such portion available to the Administrative Agent on the
proposed borrowing date in accordance with Section 2.3(b) and
the Administrative Agent may, in reliance upon such assumption, make available
to the Borrower on such date a corresponding amount.  If such amount
is made available to the Administrative Agent on a date after such borrowing
date, such Lender shall pay to the Administrative Agent on demand an amount,
until paid, equal to the product of (a) the amount not made available by such
Lender in accordance with the terms hereof, times (b) the daily
average Federal Funds Rate during such period as determined by the
Administrative Agent, times (c) a fraction
the numerator of which is the number of days that elapse from and including such
borrowing date to the date on which such amount not made available by such
Lender in accordance with the terms hereof shall have become immediately
available to the Administrative Agent and the denominator of which is
360.  A certificate of the Administrative Agent with respect to any
amounts owing under this Section shall be conclusive, absent manifest
error.  If such Lender’s Commitment Percentage of such borrowing is
not made available to the Administrative Agent by such Lender within three (3)
Business Days after such borrowing date, the Administrative Agent shall be
entitled to recover such amount made available by the Administrative Agent with
interest thereon at the rate per annum applicable to Base Rate Loans hereunder,
on demand, from the Borrower.  The failure of any Lender to make
available its Commitment Percentage of any Loan requested by the Borrower shall
not relieve it or any other Lender of its obligation, if any, hereunder to make
its Commitment Percentage of such Loan available on the borrowing date, but no
Lender shall be responsible for the failure of any other Lender to make its
Commitment Percentage of such Loan available on the borrowing
date.  Notwithstanding anything set forth herein to the contrary, any
Lender that fails to make available its Commitment Percentage of any Loan shall
not (a) have any voting or consent rights under or with respect to any Loan
Document or (b) constitute a “Lender” (or be included in the calculation of
Required Lenders hereunder) for any voting or consent rights under or with
respect to any Loan Document.




Section
4.8  Changed
Circumstances .




(a)  Circumstances Affecting
LIBOR Rate Availability.  If with respect to any Interest
Period the Administrative Agent or any Lender (after consultation with the
Administrative Agent) shall determine that, by reason of circumstances affecting
the foreign exchange and interbank markets generally, deposits in eurodollars,
in the applicable amounts are not being quoted via the Reuters Screen LIBOR01
Page or offered to the Administrative Agent or such Lender for such Interest
Period, then the Administrative Agent shall forthwith give notice thereof to the
Borrower.  Thereafter, until the Administrative Agent notifies the
Borrower that such circumstances no longer exist, the obligation of the Lenders
to make LIBOR Rate Loans and the right of the Borrower to convert any Loan to or
continue any Loan as a LIBOR Rate Loan shall be suspended, and the Borrower
shall repay in full (or cause to be repaid in full) the then outstanding
principal amount of each such LIBOR Rate Loan together with accrued interest
thereon, on the last day of the then current Interest Period applicable to such
LIBOR Rate Loan or convert the then outstanding principal amount of each such
LIBOR Rate Loan to a Base Rate Loan as of the last day of such Interest
Period.




(b)  Laws Affecting LIBOR Rate
Availability.  If, after the date hereof, the introduction of,
or any Change in Law or any change in the interpretation or administration
thereof by any Governmental Authority, central bank or comparable agency charged
with the interpretation or administration thereof, or compliance by any of the
Lenders (or any of their respective Lending Offices) with any request or
directive (whether or not having the force of law) of any such Governmental
Authority, central bank or comparable agency, shall make it unlawful or
impossible for any of the Lenders (or any of their respective Lending Offices)
to honor its obligations hereunder to make or maintain any LIBOR Rate Loan, such
Lender shall promptly give notice thereof to the Administrative Agent and the
Administrative Agent shall promptly give notice to the Borrower and the other
Lenders.  Thereafter, until the Administrative Agent notifies the
Borrower that such circumstances no longer exist, (i) the obligations of the
Lenders to make LIBOR Rate Loans and the right of the Borrower to convert any
Loan or continue any Loan as a LIBOR Rate Loan shall be suspended and thereafter
the Borrower may select only Base Rate Loans hereunder, and (ii) if any of the
Lenders may not lawfully continue to maintain a LIBOR Rate Loan to the end of
the then current Interest Period applicable thereto as a LIBOR Rate Loan, the
applicable LIBOR Rate Loan shall immediately be converted to a Base Rate Loan
for the remainder of such Interest Period.




Section
4.9  Indemnity .  The
Borrower hereby indemnifies each of the Lenders against any loss or expense
which may arise or be attributable to each Lender’s obtaining, liquidating or
employing deposits or other funds acquired to effect, fund or maintain any Loan
(a) as a consequence of any failure by the Borrower to make any payment when due
of any amount due hereunder in connection with a LIBOR Rate Loan, (b) due to any
failure of the Borrower to borrow, continue or convert on a date specified
therefor in a Notice of Borrowing or Notice of Conversion/Continuation or
(c) due to any payment, prepayment or conversion of any LIBOR Rate Loan on
a date other than the last day of the Interest Period therefor.  The
amount of such loss or expense shall be determined, in the applicable Lender’s
sole discretion, based upon the assumption that such Lender funded its
Commitment Percentage of the LIBOR Rate Loans in the London interbank market and
using any reasonable attribution or averaging methods which such Lender deems
appropriate and practical.  A certificate of such Lender setting forth
the basis for determining such amount or amounts necessary to compensate such
Lender shall be forwarded to the Borrower through the Administrative Agent and
shall be conclusively presumed to be correct save for manifest
error.




Section
4.10  Increased
Costs .




(a)  Increased Costs
Generally.  If any Change in Law shall:




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




(ii)  subject
any Lender or any Issuing Lender to any tax of any kind whatsoever with respect
to this Agreement, any Letter of Credit, any participation in a Letter of Credit
or any LIBOR Rate Loan made by it, or change the basis of taxation of payments
to such Lender or such Issuing Lender in respect thereof (except for Indemnified
Taxes or Other Taxes covered by Section 4.11 and the
imposition of, or any changein the rate of any
Excluded Tax payable by such Lender or such Issuing Lender); or




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




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




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




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




(d)  Delay in
Requests.  Failure or delay on the part of any Lender or any
Issuing Lender to demand compensation pursuant to this Section shall not
constitute a waiver of such Lender’s or such Issuing Lender’s right to demand
such compensation; provided that the
Borrower shall not be required to compensate a Lender or any Issuing Lender
pursuant to this Section for any increased costs incurred or reductions suffered
more than nine months prior to the date that such Lender or such Issuing Lender,
as the case may be, notifies the Borrower of the Change in Law giving rise to
such increased costs or reductions and of such Lender’s or such Issuing Lender’s
intention to claim compensation therefor (except that, if the Change in Law
giving rise to such increased costs or reductions is retroactive, then the
nine-month period referred to above shall be extended to include the period of
retroactive effect thereof).




Section
4.11  Taxes .




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




(b)  Payment of Other Taxes by
the Borrower. Without limiting the provisions of paragraph (a) above, the
Borrower shall timely pay any Other Taxes to the relevant Governmental Authority
in accordance with applicable law.




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




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




(e)  Status of Lenders.
Any Foreign Lender that is entitled to an exemption from or reduction of
withholding tax under the law of the jurisdiction in which the Borrower is
resident for tax purposes, or any treaty to which such jurisdiction is a party,
with respect to payments hereunder or under any other Loan Document shall
deliver to the Borrower (with a copy to the Administrative Agent), at the time
or times prescribed by applicable law or reasonably requested by the Borrower or
the Administrative Agent, such properly completed and executed documentation
prescribed by applicable law as will permit such payments to be made without
withholding or at a reduced rate of withholding.  In addition, any
Lender, if requested by the Borrower or the Administrative Agent, shall deliver
such other documentation prescribed by applicable law or reasonably requested by
the Borrower or the Administrative Agent as will enable the Borrower or the
Administrative Agent to determine whether or not such Lender is subject to
backup withholding or information reporting requirements.  Without
limiting the generality of the foregoing, in the event that the Borrower is a
resident for tax purposes in the United States, any Foreign Lender shall deliver
to the Borrower and the Administrative Agent (in such number of copies as shall
be requested by the recipient) on or prior to the date on which such Foreign
Lender becomes a Lender under this Agreement (and from time to time thereafter
upon the request of the Borrower or the Administrative Agent, but only if such
Foreign Lender is legally entitled to do so), whichever of the following is
applicable:




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




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




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




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




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




(g)  Survival.  Without
prejudice to the survival of any other agreement of the Borrower hereunder, the
agreements and obligations of the Borrower contained in this Section shall
survive the payment in full of the Obligations and the termination of the
Commitments.




Section
4.12  Mitigation Obligations;
Replacement of Lenders .




(a)  Designation of a Different
Lending Office. If any Lender requests compensation under Section 4.10, or
requires the Borrower to pay any additional amount to any Lender or any
Governmental Authority for the account of any Lender pursuant to Section 4.11, then
such Lender shall use reasonable efforts to designate a different lending office
for funding or booking its Loans hereunder or to assign its rights and
obligations hereunder to another of its offices, branches or affiliates, if, in
the judgment of such Lender, such designation or assignment (i) would eliminate
or reduce amounts payable pursuant to Section 4.10 or Section 4.11, as the
case may be, in the future and (ii) would not subject such Lender to any
unreimbursed cost or expense and would not otherwise be disadvantageous to such
Lender. The Borrower hereby agrees to pay all reasonable costs and expenses
incurred by any Lender in connection with any such designation or
assignment.




(b)  Replacement of
Lenders.  If any Lender requests compensation under Section 4.10, or if
the Borrower is required to pay any additional amount to any Lender or any
Governmental Authority for the account of any Lender pursuant to Section 4.11, or if
any Lender defaults in its obligation to fund Loans hereunder, then the Borrower
may, at its sole expense and effort, upon notice to such Lender and the
Administrative Agent, require such Lender to assign and delegate, without
recourse (in accordance with and subject to the restrictions contained in, and
consents required by, Section 13.10), all
of its interests, rights and obligations under this Agreement and the related
Loan Documents to an assignee that shall assume such obligations (which assignee
may be another Lender, if a Lender accepts such assignment); provided
that:




(i)  the
Borrower shall have paid to the Administrative Agent the assignment fee
specified in Section
13.10;




(ii)  such
Lender shall have received payment of an amount equal to the outstanding
principal of its Loans and participations in Letters of Credit, accrued interest
thereon, accrued fees and all other amounts payable to it hereunder and under
the other Loan Documents (including any amounts under Section 4.9) from the
assignee (to the extent of such outstanding principal and accrued interest and
fees) or the Borrower (in the case of all other amounts);




(iii)  in the
case of any such assignment resulting from a claim for compensation under Section 4.10 or
payments required to be made pursuant to Section 4.11, such
assignment will result in a reduction in such compensation or payments
thereafter; and




(iv)  such
assignment does not conflict with Applicable Law.




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




Section
4.13  Security .  The
Obligations of the Borrower shall be secured as provided in the Security
Documents.




ARTICLE
V


CLOSING; CONDITIONS OF
CLOSING AND BORROWING




Section
5.1  Closing .  The
closing shall take place at the offices of Kennedy Covington Lobdell &
Hickman, L.L.P. at 10:00 a.m. on July 31, 2007 or on such other place, date and
time as the parties hereto shall mutually agree.




Section
5.2  Conditions to Closing and
Initial Extensions of Credit .  The
obligation of the Lenders to close this Agreement and to make the initial Loan
or issue or participate in the initial Letter of Credit, if any, is subject to
the satisfaction of each of the following conditions:




(a)  Executed Loan
Documents.  This Agreement, a Revolving Credit Note in favor of
each Lender requesting a Revolving Credit Note, a Swingline Note in favor of the
Swingline Lender (if requested thereby), the Guaranty Agreement and the Security
Documents, together with any other applicable Loan Documents, shall have been
duly authorized, executed and delivered to the Administrative Agent by the
parties thereto, shall be in full force and effect and no Default or Event of
Default shall exist hereunder or thereunder.




(b)  Closing Certificates;
Etc.  The Administrative Agent shall have received each of the
following in form and substance reasonably satisfactory to the Administrative
Agent:




(i)  Officer’s
Certificate.  A certificate from a Responsible Officer of the
Borrower to the effect that (A) all representations and warranties contained in
this Agreement and the other Loan Documents are true, correct and complete in
all material respects; provided that any
representation or warranty that is qualified by materiality or by reference to
Material Adverse Effect shall be true, correct and complete in all respects; (B)
neither the Borrower nor any of its Subsidiaries is in violation of any of the
covenants contained in this Agreement and the other Loan Documents; (C) after
giving effect to the transactions contemplated by this Agreement, no Default or
Event of Default has occurred and is continuing; and (D) the Borrower and its
Subsidiaries have satisfied each of the conditions set forth in Section 5.2 and Section
5.3.




(ii)  Certificate of Secretary of
each Credit Party.  A certificate of a Responsible Officer of
each Credit Party certifying as to the incumbency and genuineness of the
signature of each officer of such Credit Party executing Loan Documents to which
it is a party and certifying that attached thereto is a true, correct and
complete copy of (A) the articles or certificate of incorporation or formation
of such Credit Party and all amendments thereto, certified as of a recent date
by the appropriate Governmental Authority in its jurisdiction of incorporation
or formation, (B) the bylaws or other governing document of such Credit Party as
in effect on the Closing Date, (C) resolutions duly adopted by the board of
directors or other governing body of such Credit Party authorizing the
transactions contemplated hereunder and the execution, delivery and performance
of this Agreement and the other Loan Documents to which it is a party, and (D)
each certificate required to be delivered pursuant to Section
5.2(b)(iii).




(iii)  Certificates of Good
Standing.  Certificates as of a recent date of the good
standing of each Credit Party under the laws of its jurisdiction of organization
and, to the extent requested by the Administrative Agent, each other
jurisdiction where such Credit Party is qualified to do business and, to the
extent available, a certificate of the relevant taxing authorities of such
jurisdictions certifying that such Credit Party has filed required tax returns
and owes no delinquent taxes.




(iv)  Opinions of
Counsel.  Favorable opinions of counsel to the Credit Parties
addressed to the Administrative Agent and the Lenders with respect to the Credit
Parties, the Loan Documents and such other matters as the Lenders shall request,
each in form and substance satisfactory to the Administrative
Agent.




(v)  Tax
Forms.  Copies of the United States Internal Revenue Service
forms required by Section
4.11(e).




(c)  Personal Property
Collateral.




(i)  Filings and
Recordings.  The Administrative Agent shall have received all
filings and recordations that are necessary to perfect the security interests of
the Administrative Agent, on behalf of itself and the other Secured Parties, in
the Collateral shall have been received by the Administrative Agent and the
Administrative Agent shall have received evidence and evidence reasonably
satisfactory to the Administrative Agent that upon such filings and recordations
such security interests constitute valid and perfected first priority Liens
thereon.




(ii)  Pledged
Collateral.  The Administrative Agent shall have received (A)
original stock certificates or other certificates evidencing the Capital Stock
pledged pursuant to the Security Documents, together with an undated stock power
for each such certificate duly executed in blank by the registered owner thereof
and (B) each original promissory note pledged pursuant to the Security
Documents.




(iii)  Lien Search. The
Administrative Agent shall have received the results of a Lien search (including
a search as to judgments, pending litigation and tax matters), in form and
substance reasonably satisfactory thereto, made against the Credit Parties under
the Uniform Commercial Code (or applicable judicial docket) as in effect in any
state in which any of the assets of such Credit Party are located, indicating
among other things that its assets are free and clear of any Lien except for
Permitted Liens.




(iv)  Hazard and Liability
Insurance.  The Administrative Agent shall have received
certificates of property hazard, business interruption and liability insurance,
evidence of payment of all insurance premiums for the current policy year of
each (naming the Administrative Agent as loss payee (and mortgagee, as
applicable) on all certificates for property hazard insurance and as additional
insured on all certificates for liability insurance), and, if requested by the
Administrative Agent, copies (certified by a Responsible Officer) of insurance
policies in the form required under the Security Documents and otherwise in form
and substance reasonably satisfactory to the Administrative Agent.




(d)  Consents;
Defaults.




(i)  Governmental and Third Party
Approvals.  The Credit Parties shall have received all material
governmental, shareholder and third party consents and approvals necessary (or
any other material consents as determined in the reasonable discretion of the
Administrative Agent) in connection with the transactions contemplated by this
Agreement and the other Loan Documents and the other transactions contemplated
hereby and all applicable waiting periods shall have expired without any action
being taken by any Person that could reasonably be expected to restrain, prevent
or impose any material adverse conditions on any of the Credit Parties or such
other transactions or that could seek or threaten any of the foregoing, and no
law or regulation shall be applicable which in the reasonable judgment of the
Administrative Agent could reasonably be expected to have such
effect.




(ii)  No Injunction,
Etc.  No action, proceeding, investigation, regulation or
legislation shall have been instituted, threatened or proposed before any
Governmental Authority to enjoin, restrain, or prohibit, or to obtain
substantial damages in respect of, or which is related to or arises out of this
Agreement or the other Loan Documents or the consummation of the transactions
contemplated hereby or thereby, or which, in the Administrative Agent’s sole
discretion, would make it inadvisable to consummate the transactions
contemplated by this Agreement or the other Loan Documents or the consummation
of the transactions contemplated hereby or thereby.




(e)  Financial
Matters.




(i)  Financial Statements and
Projections.  The Administrative Agent shall have received
copies of the following, in each case in form and substance satisfactory to the
Administrative Agent:




(A)  Interim
unaudited financial statements for the Borrower and its Subsidiaries for the
fiscal quarter ended June 30, 2007 (solely to the extent that such financial
statements are available on or before the Closing Date);




(B)  Audited
consolidated financial statements for D3 and its Subsidiaries for fiscal years
2004, 2005 and 2006 and interim unaudited financial statements for D3 for (x)
the fiscal quarter ended March 31, 2007 and (y) for the fiscal quarter ended
June 30, 2007 (solely to the extent that such financial statements for such
fiscal quarter ending June 30, 2007 are available on or before the Closing
Date);




(C)  A Proformabalance sheet for the
Borrower and its Subsidiaries (including, without limitation, D3) as of the
Closing Date giving proformaeffect to the
Transactions; and




(D)  Annual
projections prepared by management of the Borrower of balance sheets, income
statements and cashflow statements of the Borrower and its Subsidiaries for the
five (5) years following the Closing Date (and which will not be inconsistent
with information previously provided to the Administrative Agent).




(ii)  Financial Condition
Certificate.  The Borrower shall have delivered to the
Administrative Agent a certificate, in form and substance reasonably
satisfactory to the Administrative Agent, and certified as accurate by a
Responsible Officer, that (A) after giving effect to the Transactions, the
Borrower and each of its Subsidiaries are each Solvent, (B) attached thereto are
calculations evidencing compliance on a proforma basis with the
covenants contained in Article IX hereof,
(C) the financial projections previously delivered to the Administrative
Agent represent the good faith estimates (utilizing reasonable assumptions) of
the financial condition and operations of the Borrower and its Subsidiaries, (D)
attached thereto is a calculation of the Applicable Margin and (E) attached
thereto is a calculation of the Total Leverage Ratio, calculated as of the
Closing Date after giving proforma effect to the
Transactions, demonstrating that the Total Leverage Ratio for the twelve
monthperiod ended
as of the most recent month end prior to the Closing Date for which financing
statements are available does not exceed 2.00 to 1.00.




(iii)  Payment at Closing; Fee
Letters. The Borrower shall have paid to the Administrative Agent and the
Lenders the fees set forth or referenced in Section 4.3 to the
extent payable on the Closing Date, and any other accrued and unpaid fees or
commissions due hereunder (including, without limitation, legal fees and
expenses) and to any other Person such amount as may be due thereto in
connection with the transactions contemplated hereby, including all taxes, fees
and other charges in connection with the execution, delivery, recording, filing
and registration of any of the Loan Documents.




(f)  Intercompany
Indebtedness.  The Lenders shall be satisfied with the amount,
terms, conditions and holders of all intercompany indebtedness and all material
indebtedness and other material liabilities owing to third parties to be
outstanding on and after the Closing Date.




(g)  Acquisition .




(i)  The
Administrative Agent shall have received, in form and substance reasonably
satisfactory to the Administrative Agent, copies of the Acquisition Agreement,
each other Related Document and each other aspect of the
Transactions;




(ii)  The
Administrative Agent shall have received, in form and substance reasonably
satisfactory to the Administrative Agent, evidence that all governmental and
third-party consents and approvals required to be obtained as a condition of the
Sellers obligation to consummate the Acquisition pursuant to the terms of the
Acquisition Agreement, have been obtained; and




(iii)  The
Acquisition has been, or will concurrently be consummated in accordance with the
terms and conditions of the Acquisition Agreement (including, without
limitation, a cash purchase price of no more than $75,000,000) without any
waiver, modification or consent thereunder that is materially adverse to the
Lenders (as reasonably determined by the Administrative Agent) unless approved
by the Administrative Agent.




(h)  Revolving Credit Facility
Availability.  After giving effect to all Extensions of Credit
occurring on the Closing Date, the Borrower shall have unused Commitments of not
less than $30,000,000.




(i)  Miscellaneous.




(i)  Notice of
Borrowing.  The Administrative Agent shall have received a
Notice of Borrowing from the Borrower in accordance with Section 2.3(a) and a
Notice of Account Designation specifying the account or accounts to which the
proceeds of any Loans made after the Closing Date are to be
disbursed.




(ii)  Due
Diligence.  The Administrative Agent shall have completed, to
its satisfaction, all corporate documentation and other legal due diligence with
respect to the Transactions and the business, assets, liabilities, operations
and condition (financial or otherwise) of the Borrower and its Subsidiaries in
scope and determination satisfactory to the Administrative Agent in its sole
discretion.




(iii)  Existing
Facilities.  The Existing Facilities and all other existing
Indebtedness (other than Indebtedness permitted under Section 10.1) shall
be concurrently repaid in full and terminated on the Closing Date and all
collateral security therefor shall be released, and the Administrative Agent
shall have received one or more pay-off letters in form and substance
satisfactory to it evidencing such repayment, termination, reconveyance and
release.




(iv)  Ownership
Structure.  The capital and ownership structure and the
shareholding arrangements of the Borrower and its Subsidiaries, after giving
effect to the Transactions, shall be reasonably satisfactory to the
Administrative Agent.




(v)  Subsidiary
Dividends.  The Administrative Agent shall be satisfied there
are no material restrictions on the ability of any Subsidiary of the Borrower to
pay dividends or distributions to, or otherwise advance, directly or indirectly,
funds to the Borrower.




(vi)  Patriot
Act.  The Borrower and each of its Subsidiaries shall have
provided to the Administrative Agent and the Lenders the documentation and other
information requested by the Administrative Agent in order to comply with
requirements of the Act.




(vii)  Other
Documents.  All opinions, certificates and other instruments
and all proceedings in connection with the transactions contemplated by this
Agreement shall be in form and substance satisfactory to the Administrative
Agent.  The Administrative Agent shall have received copies of all
other documents, certificates and instruments reasonably requested thereby, with
respect to the transactions contemplated by this Agreement.




Section
5.3  Conditions to All Extensions
of Credit .  The
obligations of the Lenders to make any Extensions of Credit (including the
initial Extension of Credit), convert or continue any Loan and/or any Issuing
Lender to issue or extend any Letter of Credit are subject to the satisfaction
of the following conditions precedent on the relevant borrowing, continuation,
conversion, issuance or extension date:




(a)  Continuation of
Representations and Warranties.  Each representation and
warranty contained in this Agreement and the other Loan Documents shall be true,
correct and complete in all material respects on and as of such borrowing,
continuation, conversion, issuance or extension date with the same effect as if
made on and as of such date, except for any representation and warranty made as
of an earlier date, which representation and warranty shall remain true, correct
and complete in all material respects as of such earlier date; provided, that any
representation or warranty that is qualified by materiality or by reference to
Material Adverse Effect shall be true, correct and complete in all respects on
and as of such borrowing, continuation, conversion, issuance or extension
date.




(b)  No Existing
Default.  No Default or Event of Default shall have occurred
and be continuing (i) on the borrowing, continuation or conversion date with
respect to such Loan or after giving effect to the Loans to be made, continued
or converted on such date or (ii) on the issuance or extension date with respect
to such Letter of Credit or after giving effect to the issuance or extension of
such Letter of Credit on such date.




(c)  Notices.  The
Administrative Agent shall have received a Notice of Borrowing or Notice of
Conversion/Continuation, as applicable, from the Borrower in accordance with
Section 2.3(a)
and Section
4.2.




(d)  Additional
Documents.  The Administrative Agent shall have received each
additional document, instrument, legal opinion or other item referred to in, or
contemplated by, any Loan Document, in each case as reasonably requested by
it.




Section
5.4  Post-ClosingConditions .  On
or prior to the Post-Closing Deadline, the Administrative Agent shall have
received the following:




(a)  A
landlord agreement with respect to the real property leased by D3 Technologies,
Inc. which is located at 4838 Ronson Court, Suite L&A, San Diego,
California; and




(b)  A
landlord agreement with respect to the real property leased by LMI Finishing,
Inc. which is located at 1120 Main Parkway, Catoosa, Oklahoma;




provided that the
Borrower shall not be required to deliver any such landlord agreement to the
extent that the Administrative Agent determines that that Borrower has used
commercially reasonable efforts to obtain such landlord agreement and is unable
to do so.




ARTICLE
VI


REPRESENTATIONS AND
WARRANTIES OF THE BORROWER




Section
6.1  Representations and
Warranties .  To
induce the Administrative Agent and Lenders to enter into this Agreement and to
induce the Lenders to make Extensions of Credit, the Borrower hereby represents
and warrants to the Administrative Agent and Lenders both before and after
giving effect to the transactions contemplated hereunder that:




(a)  Organization; Power;
Qualification.  Each of the Borrower and its Subsidiaries (i)
is duly organized, validly existing and in good standing under the laws of the
jurisdiction of its incorporation or formation, (ii) has the power and authority
to own its properties and to carry on its business as now being and hereafter
proposed to be conducted and (iii) is duly qualified and authorized to do
business in each jurisdiction in which the character of its properties or the
nature of its business requires such qualification and authorization except
where the failure to be so qualified would not have a Material Adverse
Effect.  The jurisdictions in which the Borrower and its Subsidiaries
are organized and qualified to do business as of the Closing Date are described
on Schedule
6.1(a).




(b)  Ownership.  Each
Subsidiary of the Borrower as of the Closing Date is listed on Schedule
6.1(b).  As of the Closing Date, the capitalization of the
Borrower and its Subsidiaries consists of the number of shares or other
ownership interests, authorized, issued and outstanding, of such classes and
series, with or without par value, described on Schedule
6.1(b).  All outstanding shares or other ownership interests
have been duly authorized and validly issued and are fully paid and
nonassessable, with no personal liability attaching to the ownership thereof,
and not subject to any preemptive or similar rights.  The shareholders
(or members, partners or other owners, as applicable) of the Subsidiaries of the
Borrower and the number of shares or other ownership interests owned by each as
of the Closing Date are described on Schedule
6.1(b).  As of the Closing Date, there are no outstanding stock
purchase warrants, subscriptions, options, securities, instruments or other
rights of any type or nature whatsoever, which are convertible into,
exchangeable for or otherwise provide for or permit the issuance of Capital
Stock of the Borrower or its Subsidiaries, except as described on Schedule
6.1(b).




(c)  Authorization of Agreement,
Loan Documents and Borrowing. Each of the Borrower and its Subsidiaries
has the right, power and authority and has taken all necessary corporate and
other action to authorize the execution, delivery and performance of this
Agreement and each of the other Loan Documents to which it is a party in
accordance with their respective terms.  This Agreement and each of
the other Loan Documents has been duly executed and delivered by the duly
authorized officers of the Borrower and each of its Subsidiaries party thereto,
and each such document constitutes the legal, valid and binding obligation of
the Borrower and each Subsidiary party thereto, enforceable in accordance with
its terms, except as such enforceability may be limited by bankruptcy,
insolvency, reorganization, moratorium or similar state or federal debtor relief
laws from time to time in effect which affect the enforcement of creditors’
rights in general and the availability of equitable remedies.




(d)  Compliance of Agreement,
Loan Documents and Borrowing with Laws, Etc.  The execution,
delivery and performance by the Borrower and its Subsidiaries of the Loan
Documents to which each such Person is a party, in accordance with their
respective terms, the Extensions of Credit hereunder and the transactions
contemplated hereby do not and will not, by the passage of time, the giving of
notice or otherwise, (i) require any Governmental Approval or violate any
Applicable Law relating to the Borrower or any of its Subsidiaries, (ii)
conflict with, result in a breach of or constitute a default under the articles
of incorporation, bylaws or other organizational documents of the Borrower or
any of its Subsidiaries or any indenture, agreement or other instrument to which
such Person is a party or by which any of its properties may be bound or any
Governmental Approval relating to such Person, (iii) result in or require the
creation or imposition of any Lien upon or with respect to any property now
owned or hereafter acquired by such Person other than Liens arising under the
Loan Documents or (iv) require any consent or authorization of, filing with, or
other act in respect of, an arbitrator or Governmental Authority and no consent
of any other Person is required in connection with the execution, delivery,
performance, validity or enforceability of this Agreement.




(e)  Compliance with Law;
Governmental Approvals.  Each of the Borrower and its
Subsidiaries (i) has all Governmental Approvals required by any Applicable Law
for it to conduct its business, each of which is in full force and effect, is
final and not subject to review on appeal and is not the subject of any pending
or, to the best of its knowledge, threatened attack by direct or collateral
proceeding, (ii) is in compliance with each Governmental Approval applicable to
it and in compliance with all other Applicable Laws relating to it or any of its
respective properties and (iii) has timely filed all material reports, documents
and other materials required to be filed by it under all Applicable Laws with
any Governmental Authority and has retained all material records and documents
required to be retained by it under Applicable Law, except in each case (i),
(ii) or (iii) where the failure to have, comply or file could not reasonably be
expected to have a Material Adverse Effect.




(f)  Tax Returns and
Payments.  Each of the Borrower and its Subsidiaries has duly
filed or caused to be filed all federal, state, local and other tax returns
required by Applicable Law to be filed, and has paid, or made adequate provision
for the payment of, all federal, state, local and other taxes, assessments and
governmental charges or levies upon it and its property, income, profits and
assets which are due and payable.  Such returns accurately reflect in
all material respects all liability for taxes of the Borrower and its
Subsidiaries for the periods covered thereby.  Except as set forth in
Schedule 6.1(f), there is no ongoing audit or examination or, to the knowledge
of the Borrower, other investigation by any Governmental Authority of the tax
liability of the Borrower and its Subsidiaries.  No Governmental
Authority has asserted any Lien or other claim against the Borrower or any
Subsidiary thereof with respect to unpaid taxes which has not been discharged or
resolved.  The charges, accruals and reserves on the books of the
Borrower and any of its Subsidiaries in respect of federal, state, local and
other taxes for all Fiscal Years and portions thereof since the organization of
the Borrower and any of its Subsidiaries are in the judgment of the Borrower
adequate, and the Borrower does not anticipate any additional taxes or
assessments for any of such years.




(g)  Intellectual Property
Matters.  Each of the Borrower and its Subsidiaries owns or
possesses rights to use all franchises, licenses, copyrights, copyright
applications, patents, patent rights or licenses, patent applications,
trademarks, trademark rights, service mark, service mark rights, trade names,
trade name rights, copyrights and rights with respect to the foregoing which are
required to conduct its business.  No event has occurred which
permits, or after notice or lapse of time or both would permit, the revocation
or termination of any such rights, and neither the Borrower nor any Subsidiary
thereof is liable to any Person for infringement under Applicable Law with
respect to any such rights as a result of its business operations.




(h)  Environmental
Matters.




(i)  The
properties owned, leased or operated by the Borrower and its Subsidiaries now or
in the past do not contain, and to their knowledge, have not previously
contained, any Hazardous Materials in amounts or concentrations which (A)
constitute or constituted a violation of applicable Environmental Laws or (B)
could give rise to liability under applicable Environmental Laws, except where
such violation or liability could not reasonably be expected, individually or in
the aggregate, to have a Material Adverse Effect;




(ii)  The
Borrower, each Subsidiary and such properties and all operations conducted in
connection therewith are in compliance, and have been in compliance, with all
applicable Environmental Laws, and there is no contamination at, under or about
such properties or such operations which could interfere with the continued
operation of such properties or impair the fair saleable value thereof, except
for any such noncompliance or contamination that could not reasonably be
expected, individually or in the aggregate, to have a Material Adverse
Effect;




(iii)  Neither
the Borrower nor any Subsidiary thereof has received any notice of violation,
alleged violation, non-compliance, liability or potential liability regarding
environmental matters, Hazardous Materials, or compliance with Environmental
Laws, nor does the Borrower or any Subsidiary thereof have knowledge or reason
to believe that any such notice will be received or is being threatened, except
where such violation, alleged violation, non-compliance, liability or potential
liability which is the subject of such notice could not reasonably be expected,
individually or in the aggregate, to have a Material Adverse
Effect;




(iv)  Hazardous
Materials have not been transported or disposed of to or from the properties
owned, leased or operated by the Borrower and its Subsidiaries in violation of,
or in a manner or to a location which could give rise to liability under,
Environmental Laws, nor have any Hazardous Materials been generated, treated,
stored or disposed of at, on or under any of such properties in violation of, or
in a manner that could give rise to liability under, any applicable
Environmental Laws, except where such violation or liability could not
reasonably be expected, individually or in the aggregate, to have a Material
Adverse Effect;




(v)  No
judicial proceedings or governmental or administrative action is pending, or, to
the knowledge of the Borrower, threatened, under any Environmental Law to which
the Borrower or any Subsidiary thereof is or will be named as a potentially
responsible party with respect to such properties or operations conducted in
connection therewith, nor are there any consent decrees or other decrees,
consent orders, administrative orders or other orders, or other administrative
or judicial requirements outstanding under any Environmental Law with respect to
Borrower, any Subsidiary or such properties or such operations, except where
such proceeding, action, decree, order or other requirement could not reasonably
be expected, individually or in the aggregate, to have a Material Adverse
Effect; and




(vi)  There has
been no release, or to the best of the Borrower’s knowledge, threat of release,
of Hazardous Materials at or from properties owned, leased or operated by the
Borrower or any Subsidiary, now or in the past, in violation of or in amounts or
in a manner that could give rise to liability under Environmental Laws, except
where such violation or liability could not reasonably be expected, individually
or in the aggregate, to have a Material Adverse Effect.




(i)  ERISA.




(i)  As of the
Closing Date, neither the Borrower nor any ERISA Affiliate maintains or
contributes to, or has any obligation under, any Employee Benefit Plans other
than those identified on Schedule
6.1(i);




(ii)  The
Borrower and each ERISA Affiliate is in material compliance with all applicable
provisions of ERISA and the regulations and published interpretations thereunder
with respect to all Employee Benefit Plans except for any required amendments
for which the remedial amendment period as defined in Section 401(b) of the Code
has not yet expired and except where a failure to so comply could not reasonably
be expected to have a Material Adverse Effect.  Each Employee Benefit
Plan that is intended to be qualified under Section 401(a) of the Code has been
determined by the Internal Revenue Service to be so qualified, and each trust
related to such plan has been determined to be exempt under Section 501(a) of
the Code except for such plans that have not yet received determination letters
but for which the remedial amendment period for submitting a determination
letter has not yet expired.  No liability has been incurred by the
Borrower or any ERISA Affiliate which remains unsatisfied for any taxes or
penalties with respect to any Employee Benefit Plan or any Multiemployer Plan
except for a liability that could not reasonably be expected to have a Material
Adverse Effect;




(iii)  As of the
Closing Date, no Pension Plan has been terminated, nor has any accumulated
funding deficiency (as defined in Section 412 of the Code) been incurred
(without regard to any waiver granted under Section 412 of the Code), nor has
any funding waiver from the Internal Revenue Service been received or requested
with respect to any Pension Plan, nor has the Borrower or any ERISA Affiliate
failed to make any contributions or to pay any amounts due and owing as required
by Section 412 of the Code, Section 302 of ERISA or the terms of any Pension
Plan prior to the due dates of such contributions under Section 412 of the Code
or Section 302 of ERISA, nor has there been any event requiring any disclosure
under Section 4041(c)(3)(C) or 4063(a) of ERISA with respect to any Pension
Plan;




(iv)  Except
where the failure of any of the following representations to be correct in all
material respects could not reasonably be expected to have a Material Adverse
Effect, neither the Borrower nor any ERISA Affiliate has:  (A) engaged
in a nonexempt prohibited transaction described in Section 406 of the ERISA or
Section 4975 of the Code, (B) incurred any liability to the PBGC which remains
outstanding other than the payment of premiums and there are no premium payments
which are due and unpaid, (C) failed to make a required contribution or payment
to a Multiemployer Plan, or (D) failed to make a required installment or other
required payment under Section 412 of the Code;




(v)  No
Termination Event has occurred or is reasonably expected to occur;
and




(vi)  Except
where the failure of any of the following representations to be correct in all
material respects could not reasonably be expected to have a Material Adverse
Effect, no proceeding, claim (other than a benefits claim in the ordinary course
of business), lawsuit and/or investigation is existing or, to the best knowledge
of the Borrower after due inquiry, threatened concerning or involving any (A)
employee welfare benefit plan (as defined in Section 3(1) of ERISA) currently
maintained or contributed to by the Borrower or any ERISA Affiliate, (B) Pension
Plan or (C) Multiemployer Plan.




(j)  Margin
Stock.  Neither the Borrower nor any Subsidiary thereof is
engaged principally or as one of its activities in the business of extending
credit for the purpose of “purchasing” or “carrying” any “margin stock” (as each
such term is defined or used, directly or indirectly, in Regulation U of the
Board of Governors of the Federal Reserve System).  No part of the
proceeds of any of the Loans or Letters of Credit will be used for purchasing or
carrying margin stock or for any purpose which violates, or which would be
inconsistent with, the provisions of Regulation T, U or X of such Board of
Governors.




(k)  Government
Regulation.  Neither the Borrower nor any Subsidiary thereof is
an “investment company” or a company “controlled” by an “investment company” (as
each such term is defined or used in the Investment Company Act of 1940, as
amended) and neither the Borrower nor any Subsidiary thereof is, or after giving
effect to any Extension of Credit will be, subject to regulation under the
Interstate Commerce Act, as amended, or any other Applicable Law which limits
its ability to incur or consummate the transactions contemplated
hereby.




(l)  Material Government
Contracts and Material Contracts.




(i)  Schedule 6.1(l) sets
forth a complete and accurate list of all Material Government Contracts of the
Borrower and its Subsidiaries in effect as of the Closing Date (except for
classified Material Government Contracts which may not be disclosed to third
parties pursuant to the express written terms thereof).  Other than as
set forth in Schedule
6.1(l), each such Material Government Contract in existence on the
Closing Date is, and after giving effect to the consummation of the transactions
contemplated by the Loan Documents will be, in full force and effect as of the
Closing Date in accordance with the terms thereof.  The Borrower and
its Subsidiaries have made available for review by the Administrative Agent a
true and complete copy of each Material Government Contract required to be
listed on Schedule
6.1(l) (except for classified Material Government Contracts which may not
be disclosed to third parties pursuant to the express written terms
thereof).  As of the Closing Date, neither the Borrower nor any of its
Subsidiaries (nor, to the knowledge of the Borrower, any other party thereto) is
in breach of or in default under any Material Government Contract.




(ii)  Schedule 6.1(l) sets
forth a complete and accurate list of all other Material Contracts of the
Borrower and its Subsidiaries in effect as of the Closing Date not listed on any
other Schedule hereto; other than as set forth in Schedule 6.1(l), each
such Material Contract is, and after giving effect to the consummation of the
transactions contemplated by the Loan Documents will be, in full force and
effect in accordance with the terms thereof.  The Borrower and its
Subsidiaries have delivered to the Administrative Agent a true and complete copy
of each Material Contract required to be listed on Schedule 6.1(l) or
any other Schedule hereto.  Neither the Borrower nor any Subsidiary
(nor, to the knowledge of the Borrower, any other party thereto) is in breach of
or in default under any Material Contract in any material respect.




(m)  Employee Relations.
Each of the Borrower and its Subsidiaries has a stable work force in place and
is not, as of the Closing Date, party to any collective bargaining agreement nor
has any labor union been recognized as the representative of its employees
except as set forth on Schedule
6.1(m).  The Borrower knows of no pending, threatened or
contemplated strikes, work stoppage or other collective labor disputes involving
its employees or those of its Subsidiaries.




(n)  Burdensome
Provisions.  Neither the Borrower nor any Subsidiary thereof is
a party to any indenture, agreement, lease or other instrument, or subject to
any corporate or partnership restriction, Governmental Approval or Applicable
Law which is so unusual or burdensome as in the foreseeable future could be
reasonably expected to have a Material Adverse Effect.  The Borrower
and its Subsidiaries do not presently anticipate that future expenditures needed
to meet the provisions of any statutes, orders, rules or regulations of a
Governmental Authority will be so burdensome as to have a Material Adverse
Effect.  No Subsidiary is party to any agreement or instrument or
otherwise subject to any restriction or encumbrance that restricts or limits its
ability to make dividend payments or other distributions in respect of its
Capital Stock to the Borrower or any Subsidiary or to transfer any of its assets
or properties to the Borrower or any other Subsidiary in each case other than
existing under or by reason of the Loan Documents or Applicable
Law.




(o)  Financial
Statements.  The audited and unaudited financial statements
delivered pursuant to Section 5.2(e)(i) are
complete and correct in all material respects and fairly present in all material
respects on a Consolidated basis the assets, liabilities and financial position
of the Borrower, D3 and their respective Subsidiaries as at such dates, and the
results of the operations and changes of financial position for the periods then
ended (other than customary year-end adjustments for unaudited financial
statements).  All such financial statements, including the related
schedules and notes thereto, have been prepared in accordance with GAAP (but, in
the case of any such financial statements, schedules and notes which are
unaudited, only to the extent GAAP is applicable to interim unaudited
reports).  The Borrower and its Subsidiaries have no Indebtedness,
obligation or other unusual forward or long term commitment which is not fairly
reflected in the foregoing financial statements or in the notes
thereto.  The proforma financial
statements delivered pursuant to Section 5.2(e)(i)(C)
were prepared in good faith on the basis of the assumptions stated therein,
which assumptions are believed to be reasonable in light of then existing
conditions except that such financial statements and forecasts shall be subject
to normal year end closing and audit adjustments.




(p)  No Material Adverse
Change.  Since December 31, 2006, there has been no material
adverse change in the properties, business, operations, prospects, or condition
(financial or otherwise) of the Borrower and its Subsidiaries and no event has
occurred or condition arisen that could reasonably be expected to have a
Material Adverse Effect.




(q)  Solvency.  As
of the Closing Date and after giving effect to each Extension of Credit made
hereunder, the Borrower and each of its Subsidiaries will be
Solvent.




(r)  Titles to
Properties.  Each of the Borrower and its Subsidiaries has such
title to the real property owned, if any, or leased by it as is necessary or
desirable to the conduct of its business and valid and legal title to all of its
personal property and assets, including, but not limited to, those reflected on
the balance sheets of the Borrower and its Subsidiaries delivered pursuant to
Section 6.1(n),
except those which have been disposed of by the Borrower or its Subsidiaries
subsequent to such date which dispositions have been in the ordinary course of
business or as otherwise expressly permitted hereunder. As of the Closing Date,
neither the Borrower or any of its Subsidiaries owns any real
property.




(s)  Liens.  None
of the properties and assets of the Borrower or any Subsidiary thereof is
subject to any Lien, except Permitted Liens.  No financing statement
under the Uniform Commercial Code of any state which names the Borrower or any
Subsidiary thereof or any of their respective trade names or divisions as debtor
and which has not been terminated, has been filed in any state or other
jurisdiction and neither the Borrower nor any Subsidiary thereof has signed any
such financing statement or any security agreement authorizing any secured party
thereunder to file any such financing statement, except to perfect those
Permitted Liens.




(t)  Indebtedness and Guaranty
Obligations.  Schedule 6.1(t) is a
complete and correct listing of all Indebtedness and Guaranty Obligations of the
Borrower and its Subsidiaries as of the Closing Date in excess of $500,000 other
than inter-company Indebtedness and Guaranty Obligations permitted pursuant to
Section
10.1(h).  The Borrower and its Subsidiaries have performed and
are in compliance with all of the terms of such Indebtedness and Guaranty
Obligations and all instruments and agreements relating thereto, and no default
or event of default, or event or condition which with notice or lapse of time or
both would constitute such a default or event of default on the part of the
Borrower or any of its Subsidiaries exists with respect to any such Indebtedness
or Guaranty Obligation.




(u)  Litigation. Except
for matters existing on the Closing Date and set forth on Schedule 6.1(u),
there are no actions, suits or proceedings pending nor, to the knowledge of the
Borrower, threatened against or in any other way relating adversely to or
affecting the Borrower or any Subsidiary thereof or any of their respective
properties in any court or before any arbitrator of any kind or before or by any
Governmental Authority that (i) has or could reasonably be expected to have
a Material Adverse Effect, or (ii) materially adversely affects any
Transaction or any other transaction contemplated hereby.




(v)  Absence of
Defaults.  No event has occurred or is continuing which
constitutes a Default or an Event of Default.




(w)  Senior Indebtedness
Status.  The Obligations of the Borrower and each of its
Subsidiaries under this Agreement and each of the other Loan Documents rank and
shall continue to rank at least senior in priority of payment to all
Subordinated Indebtedness of each such Person and is designated as “Senior
Indebtedness” or otherwise treated as senior debt under all instruments and
documents, now or in the future, relating to all Subordinated
Indebtedness.




(x)  OFAC.  None
of the Borrower, any Affiliate of the Borrower or any Guarantor: (i) is a
Sanctioned Person, (ii) has more than 10% of its assets in Sanctioned Entities,
or (iii) derives more than 10% of its operating income from investments in, or
transactions with Sanctioned Persons or Sanctioned Entities.  The
proceeds of any Loan will not be used and have not been used to fund any
operations in, finance any investments or activities in, or make any payments
to, a Sanctioned Person or a Sanctioned Entity.




(y)  Accuracy and Completeness of
Information.  All written information, reports and other papers
and data produced by or on behalf of the Borrower or any Subsidiary thereof
(other than financial projections, which shall be subject to the reasonable
satisfaction of the Administrative Agent) and furnished to the Administrative
Agent or the Lenders were, at the time the same were so furnished, complete and
correct in all material respects to the extent necessary to give the recipient a
true and accurate knowledge of the subject matter.




(z)  Disclosure.  The
Borrower has disclosed to the Administrative Agent and the Lenders all
agreements, instruments and corporate or other restrictions to which any of the
Credit Parties are subject, and all other matters known to it (other than
general economic conditions), that, individually or in the aggregate, could
reasonably be expected to result in a Material Adverse Effect.  No
financial statement, material report, material certificate or other material
information furnished (whether in writing or orally) by or on behalf of any of
the Credit Parties to the Administrative Agent or any Lender in connection with
the transactions contemplated hereby and the negotiation of this Agreement or
delivered hereunder (as modified or supplemented by other information so
furnished) contains any material misstatement of fact or omits to state any
material fact necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading; provided that, with
respect to projected financial information, pro forma financial information,
estimated financial information and other projected or estimated information,
the Borrower represents only that such information was prepared in good faith
based upon assumptions believed to be reasonable at the time.




Section
6.2  Survival of Representations
and Warranties, Etc .  All
representations and warranties set forth in this Article VI and all
representations and warranties contained in any certificate, or any of the Loan
Documents (including, but not limited to, any such representation or warranty
made in or in connection with any amendment thereto) shall constitute
representations and warranties made under this Agreement.  All
representations and warranties made under this Agreement shall be made or deemed
to be made at and as of the Closing Date (except those that are expressly made
as of a specific date), shall survive the Closing Date and shall not be waived
by the execution and delivery of this Agreement, any investigation made by or on
behalf of the Lenders or the Administrative Agent or any Extension of Credit
hereunder.




ARTICLE
VII


FINANCIAL INFORMATION AND
NOTICES




Until all
the Obligations (other than (a) contingent or indemnification obligations not
then due and (b) the Specified Obligations) have been paid and satisfied in full
and the Commitments terminated, unless consent has been obtained in the manner
set forth in Section
13.2, the Borrower will furnish or cause to be furnished to the
Administrative Agent at the Administrative Agent’s Office at the address set
forth in Section
13.1 and to the Lenders at their respective addresses as set forth on the
Register, or such other office as may be designated by the Administrative Agent
and Lenders from time to time:




Section
7.1  Financial Statements and
Projections .




(a)  Quarterly Financial
Statements.  As soon as practicable and in any event within
forty-five (45) days (or, if earlier, on the date of any required public filing
thereof) after the end of each of the first three (3) fiscal quarters of each
Fiscal Year, an unaudited Consolidated balance sheet of the Borrower and its
Subsidiaries as of the close of such fiscal quarter and unaudited Consolidated
statements of income and cash flows for the fiscal quarter then ended and that
portion of the Fiscal Year then ended, including the notes thereto, all in
reasonable detail setting forth in comparative form the corresponding figures as
of the end of and for the corresponding period in the preceding Fiscal Year and
prepared by the Borrower in accordance with GAAP (to the extent GAAP is
applicable to interim unaudited reports) and, if applicable, containing
disclosure of the effect on the financial position or results of operations of
any change in the application of accounting principles and practices during the
period, and certified by the chief financial officer of the Borrower to present
fairly in all material respects the financial condition of the Borrower and its
Subsidiaries on a Consolidated basis as of their respective dates and the
results of operations of the Borrower and its Subsidiaries for the respective
periods then ended, subject to normal year end adjustments.  Delivery
by the Borrower to the Administrative Agent and the Lenders of the Borrower’s
quarterly report to the SEC on Form 10-Q with respect to any fiscal quarter, or
the availability of such report on EDGAR Online, within the period specified
above shall be deemed to be compliance by the Borrower with this Section
7.1(a).




(b)  Annual Financial
Statements.  As soon as practicable and in any event within
ninety (90) days (or, if earlier, on the date of any required public filing
thereof) after the end of each Fiscal Year, an audited Consolidated balance
sheet of the Borrower and its Subsidiaries as of the close of such Fiscal Year
and audited Consolidated statements of income, retained earnings and cash flows
for the Fiscal Year then ended, including the notes thereto, all in reasonable
detail setting forth in comparative form the corresponding figures as of the end
of and for the preceding Fiscal Year and prepared in accordance with GAAP and,
if applicable, containing disclosure of the effect on the financial position or
results of operations of any change in the application of accounting principles
and practices during the year.  Such annual financial statements shall
be audited by an independent certified public accounting firm acceptable to the
Administrative Agent, and accompanied by a report thereon by such certified
public accountants that is not qualified with respect to scope limitations
imposed by the Borrower or any of its Subsidiaries or with respect to accounting
principles followed by the Borrower or any of its Subsidiaries not in accordance
with GAAP.  Delivery by the Borrower to the Administrative Agent and
the Lenders of the Borrower’s annual report to the SEC on Form 10-K with respect
to any Fiscal Year, or the availability of such report on EDGAR Online, within
the period specified above shall be deemed to be compliance by the Borrower with
this Section
7.1(b).




(c)  Annual Budget and Financial
Projections.  As soon as practicable and in any event within
thirty (30) days after the endof each Fiscal Year, an
annual operating and capital budget of the Borrower and its Subsidiaries for the
ensuing four (4) fiscal quarters, in a form and with calculations to be made in
a manner reasonably satisfactory to the Administrative Agent.




Section
7.2  Officer’s Compliance
Certificate .  At
each time financial statements are delivered pursuant to Sections 7.1(a) or
(b) and at such
other times as the Administrative Agent shall reasonably request, an Officer’s
Compliance Certificate.




Section
7.3  Other
Reports .




(a)  Promptly
upon receipt thereof, copies of all reports, if any, submitted to the Borrower
or its Board of Directors by its independent public accountants in connection
with their auditing function, including, without limitation, any management
report and any management responses thereto;




(b)  Promptly
upon the request thereof, such other information and documentation required by
bank regulatory authorities under applicable “know your customer” and Anti-Money
Laundering rules and regulations (including, without limitation, the Act), as
from time to time reasonably requested by the Administrative Agent or any
Lender; and




(c)  Such
other information regarding the operations, business affairs and financial
condition of the Borrower or any of its Subsidiaries as the Administrative Agent
or any Lender may reasonably request.




Section
7.4  Notice of Litigation and
Other Matters .  Prompt
(but in no event later than ten (10) days after an officer of the Borrower
obtains knowledge thereof) telephonic and written notice of:




(a)  the
commencement of all proceedings and investigations by or before any Governmental
Authority and all actions and proceedings in any court or before any arbitrator
against or involving the Borrower or any Subsidiary thereof or any of their
respective properties, assets or businesses which, if adversely determined,
could reasonably be expected to have a Material Adverse Effect;




(b)  any
notice of any violation received by the Borrower or any Subsidiary thereof from
any Governmental Authority including, without limitation, any notice of
violation of Environmental Laws which could reasonably be expected to have a
Material Adverse Effect;




(c)  any labor
controversy that has resulted in, or threatens to result in, a strike or other
work action against the Borrower or any Subsidiary thereof which could
reasonably be expected to have a Material Adverse Effect;




(d)  any
attachment, judgment, lien, levy or order exceeding $750,000 that may be
assessed against or threatened against the Borrower or any Subsidiary
thereof;




(e)  (i) any
Default or Event of Default or (ii) any event which constitutes or which
with the passage of time or giving of notice or both would constitute a default
or event of default under any Material Contract to which the Borrower or any of
its Subsidiaries is a party or by which the Borrower or any Subsidiary thereof
or any of their respective properties may be bound;




(f)  (i) any
unfavorable determination letter from the Internal Revenue Service regarding the
qualification of an Employee Benefit Plan under Section 401(a) of the Code
(along with a copy thereof), (ii) all notices received by the Borrower or any
ERISA Affiliate of the PBGC’s intent to terminate any Pension Plan or to have a
trustee appointed to administer any Pension Plan, (iii) all notices received by
the Borrower or any ERISA Affiliate from a Multiemployer Plan sponsor concerning
the imposition or amount of withdrawal liability pursuant to Section 4202 of
ERISA and (iv) the Borrower obtaining knowledge or reason to know that the
Borrower or any ERISA Affiliate has filed or intends to file a notice of intent
to terminate any Pension Plan under a distress termination within the meaning of
Section 4041(c) of ERISA; and




(g)  any event
which makes any of the representations set forth in Section 6.1
inaccurate in any respect.




The
Borrower hereby acknowledges that the Administrative Agent and/or the Arranger
will make available to the Lenders and the L/C Issuer materials and/or
information provided by or on behalf of the Borrower hereunder (collectively,
“Borrower
Materials”) by posting the Borrower Materials on SyndTrak Online or
another similar electronic system (the “Platform”).  Notwithstanding
anything to the contrary contained in the preceding sentence, the Borrower’s
compliance with respect to the timely delivery of Borrower Materials shall be
determined by reference to the date such Borrower Materials are initially
delivered by the Borrower to the Administrative Agent, not by reference to the
date such Borrower Materials are posted on the Platform.  The Borrower
will cooperate with the Administrative Agent in connection with the publication
of Borrower Materials pursuant to this Article VII and will
designate Borrower Materials (a) that are either available to the public or not
material with respect to the Borrower and its Subsidiaries or any of their
respective securities for purposes of United States federal and state securities
laws, as “Public
Information” and (b) that are not Public Information as “Private
Information”.




Section
7.5  Accuracy of
Information .  All
written information, reports, statements and other papers and data furnished by
or on behalf of the Borrower to the Administrative Agent or any Lender whether
pursuant to this Article VII or any
other provision of this Agreement, or any of the Security Documents, shall, at
the time the same is so furnished, comply with the representations and
warranties set forth in Section 6.1(y)and
(z).




ARTICLE
VIII


AFFIRMATIVE
COVENANTS




Until all
of the Obligations (other than (a) contingent or indemnification obligations not
then due and (b) the Specified Obligations) have been paid and satisfied in full
and the Commitments terminated, unless consent has been obtained in the manner
provided for in Section 13.2, the
Borrower will, and will cause each of its Subsidiaries to:




Section
8.1  Preservation of Corporate
Existence and Related Matters .  Except
as permitted by Section 10.4, (a)
preserve and maintain its separate corporate, limited liability company,
partnership or other entity existence and all rights, permits, franchises,
licenses and privileges necessary to the conduct of its business, and (b) except
where the failure to qualify or remain qualified as a foreign corporation could
not reasonably be expected to have a Material Adverse Effect, qualify and remain
qualified as a foreign corporation and authorized to do business in each
jurisdiction where the nature and scope of its activities require it to so
qualify under Applicable Law.




Section
8.2  Maintenance of
Property .  In
addition to the requirements of any of the Security Documents, protect and
preserve all properties useful in and material to its business, including
copyrights, patents, trade names, service marks and trademarks; maintain in good
working order and condition, ordinary wear and tear excepted, all buildings,
equipment and other tangible real and personal property; and from time to time
make or cause to be made all repairs, renewals and replacements thereof and
additions to such property necessary for the conduct of its business, so that
the business carried on in connection therewith may be conducted in a
commercially reasonable manner.




Section
8.3  Insurance .  Maintain
insurance with financially sound and reputable insurance companies against such
risks and in such amounts as are customarily maintained by similar businesses
and as may be required by Applicable Law and as are required by any Security
Documents (including, without limitation, hazard and business interruption
insurance), and on the Closing Date and from time to time thereafter deliver to
the Administrative Agent upon its request a detailed list of the insurance then
in effect, stating the names of the insurance companies, the amounts and rates
of the insurance, the dates of the expiration thereof and the properties and
risks covered thereby.




Section
8.4  Accounting Methods and
Financial Records .  Maintain
a system of accounting, and keep such books, records and accounts (which shall
be true and complete in all material respects) as may be required or as may be
necessary to permit the preparation of financial statements in accordance with
GAAP and in compliance with the regulations of any Governmental Authority having
jurisdiction over it or any of its properties.




Section
8.5  Payment and Performance of
Obligations .  Pay
and perform all Obligations under this Agreement and the other Loan Documents,
and pay or perform (a) all taxes, assessments and other governmental charges
that may be levied or assessed upon it or any of its property, and (b) all other
indebtedness, obligations and liabilities in accordance with customary trade
practices; provided, that the
Borrower or such Subsidiary may contest any item described in clauses (a) or (b)
of this Section in good faith so long as adequate reserves are maintained with
respect thereto in accordance with GAAP.




Section
8.6  Compliance With Laws and
Approvals .  Observe
and remain in compliance in all material respects with all Applicable Laws and
maintain in full force and effect all Governmental Approvals, in each case
applicable to the conduct of its business.




Section
8.7  Environmental
Laws .  In
addition to and without limiting the generality of Section 8.6,
(a) comply with, and ensure such compliance by all tenants and subtenants
with all applicable Environmental Laws and obtain and comply with and maintain,
and ensure that all tenants and subtenants, if any, obtain and comply with and
maintain, any and all licenses, approvals, notifications, registrations or
permits required by applicable Environmental Laws except where the failure to do
so could not reasonably be expected, individually or in the aggregate, to have a
Material Adverse Effect, (b) conduct and complete all investigations, studies,
sampling and testing, and all remedial, removal and other actions required under
Environmental Laws, and promptly comply with all lawful orders and directives of
any Governmental Authority regarding Environmental Laws except where the failure
to conduct or complete such actions, or comply with such orders or directions,
could not reasonably be expected, individually or in the aggregate, to have a
Material Adverse Effect, and (c) defend, indemnify and hold harmless the
Administrative Agent and the Lenders, and their respective parents,
Subsidiaries, Affiliates, employees, agents, officers and directors, from and
against any claims, demands, penalties, fines, liabilities, settlements,
damages, costs and expenses of whatever kind or nature known or unknown,
contingent or otherwise, arising out of, or in any way relating to the presence
of Hazardous Materials, or the violation of,
noncompliance with or liability under any Environmental Laws applicable to the
operations of the Borrower or any such Subsidiary, or any orders, requirements
or demands of Governmental Authorities related thereto, including, without
limitation, reasonable attorney’s and consultant’s fees, investigation and
laboratory fees, response costs, court costs and litigation expenses, except to
the extent that any of the foregoing are determined by a court of competent
jurisdiction by a final and nonappealable judgment to have resulted from the
gross negligence or willful misconduct of the party seeking indemnification
therefor.




Section
8.8  Compliance with
ERISA . In
addition to and without limiting the generality of Section 8.6, (a)
except where the failure to so comply could not, individually or in the
aggregate, reasonably be expected to have a Material Adverse Effect, (i) comply
with all material applicable provisions of ERISA and the regulations and
published interpretations thereunder with respect to all Employee Benefit Plans,
(ii) not take any action or fail to take action the result of which could be a
liability to the PBGC or to a Multiemployer Plan, (iii) not participate in any
prohibited transaction that could result in any civil penalty under ERISA or tax
under the Code and (iv) operate each Employee Benefit Plan in such a manner that
will not incur any tax liability under Section 4980B of the Code or any
liability to any qualified beneficiary as defined in Section 4980B of the Code
and (b) furnish to the Administrative Agent upon the Administrative Agent’s
request such additional information about any Employee Benefit Plan as may be
reasonably requested by the Administrative Agent.




Section
8.9  Compliance With
Agreements .  Comply
in all material respects with each term, condition and provision of all leases,
agreements and other instruments entered into in the conduct of its business
including, without limitation, any Material Contract; provided, that the
Borrower or any such Subsidiary may contest any such lease, agreement or other
instrument in good faith through applicable proceedings so long as adequate
reserves are maintained in accordance with GAAP.




Section
8.10  Visits and
Inspections .  Permit
representatives of the Administrative Agent or any Lender, from time to time,
upon reasonable notice and during normal business hours, to visit and inspect
its properties; inspect, audit and make extracts from its books, records and
files, including, but not limited to, management letters prepared by independent
accountants; and discuss with its principal officers, and its independent
accountants, its business, assets, liabilities, financial condition, results of
operations and business prospects.




Section
8.11  Additional
Subsidiaries . Notify
the Administrative Agent of the creation or acquisition of any Subsidiary or the
designation of any Subsidiary as a Subsidiary and promptly thereafter (and in
any event within thirty (30) days), cause such Person to (i) become a
Guarantor by delivering to the Administrative Agent a duly executed supplement
to the Guaranty Agreement or such other document as the Administrative Agent
shall deem appropriate for such purpose, (ii) pledge a security interest in
all collateral owned by such Subsidiary by delivering to the Administrative
Agent a duly executed supplement to each Security Document or such other
document as the Administrative Agent shall deem appropriate for such purpose and
comply with the terms of each Security Document, (iii) deliver to the
Administrative Agent such documents and certificates referred to in Section 5.2 as may be
reasonably requested by the Administrative Agent, (iv) deliver to the
Administrative Agent such original Capital Stock or other certificates and stock
or other transfer powers evidencing the Capital Stock of such Person, (v)
deliver to the Administrative Agent such updated Schedules to the Loan Documents
as requested by the Administrative Agent with respect to such Person, and (vi)
deliver to the Administrative Agent such other documents as may be reasonably
requested by the Administrative Agent, all in form, content and scope reasonably
satisfactory to the Administrative Agent.




Section
8.12  Real Property
Collateral .  Notify
the Administrative Agent within ten (10) Business Days after the acquisition of
any owned or leased real property by any Credit Party, and within sixty (60)
days following request by the Administrative Agent, deliver such mortgages,
leasehold mortgages, deeds of trust, title insurance policies, landlord
agreements, environmental reports, surveys and other documents reasonably
requested by the Administrative Agent in connection with granting and perfecting
a first priority Lien on such real property in favor of the Administrative
Agent, for the benefit of itself and the other Secured Parties, all in form and
substance reasonably satisfactory to the Administrative Agent; provided, however, that no
Credit Party shall be required to comply with the requirements of this Section 8.12 with
respect to any individual owned or leased real property unless the fair market
value of such real property exceeds $1,000,000.




Section
8.13  Use of
Proceeds .  The
Borrower shall use the proceeds of the Extensions of Credit (a) to finance the
Transactions, (b) to finance permitted acquisitions, and (c) for ongoing working
capital and general corporate requirements of the Borrower and its Subsidiaries,
including the payment of certain fees and expenses incurred in connection with
the Transactions and the Facilities.




Section
8.14  Further
Assurances .  Make,
execute and deliver all such additional and further acts, things, deeds and
instruments as the Administrative Agent, the Issuing Lenders or the Required
Lenders (through the Administrative Agent) may reasonably require to document
and consummate the transactions contemplated hereby and to vest completely in
and insure the Administrative Agent, the Issuing Lenders and the Lenders their
respective rights under this Agreement, the Letters of Credit and the other Loan
Documents.




ARTICLE
IX


FINANCIAL
COVENANTS




Until all
of the Obligations (other than (a) contingent or indemnification obligations not
then due and (b) the Specified Obligations) have been paid and satisfied in full
and the Commitments terminated, unless consent has been obtained in the manner
set forth in Section
13.2, the Borrower and its Subsidiaries on a Consolidated basis will
not:




Section
9.1  Total Leverage
Ratio :  As
of any fiscal quarter end, permit the Total Leverage Ratio to be greater than
3.00 to 1.00.




Section
9.2  Fixed Charge Coverage
Ratio :  As
of any fiscal quarter end, permit the Fixed Charge Coverage Ratio to be less
than 1.15 to 1.00.




ARTICLE
X


NEGATIVE
COVENANTS




Until all
of the Obligations (other than (a) contingent or indemnification obligations not
then due and (b) the Specified Obligations) have been paid and satisfied in full
and the Commitments terminated, unless consent has been obtained in the manner
set forth in Section
13.2, the Borrower has not, will not and will not permit any of its
Subsidiaries to:




Section
10.1  Limitations on
Indebtedness .  Create,
incur, assume or suffer to exist any Indebtedness except:




(a)  the
Obligations (excluding Specified Hedge Obligations permitted pursuant to Section
10.1(b));




(b)  Indebtedness
incurred in connection with a Hedging Agreement which is entered into for
interest rate, foreign currency or other business purposes and not for
speculative purposes, with a counterparty reasonably satisfactory to the
Administrative Agent; provided, that any
counterparty that is a Lender or an Affiliate thereof shall be deemed
satisfactory to the Administrative Agent;




(c)  Indebtedness
existing on the Closing Date and not otherwise permitted under this Section, as
set forth on Schedule
6.1(t), and the renewal, refinancing, extension and replacement (but not
the increase in the aggregate principal amount) thereof;




(d)  Indebtedness
of the Borrower and its Subsidiaries incurred in connection with Capital Leases
in an aggregate amount not to exceed $2,000,000 on any date of
determination;




(e)  purchase
money Indebtedness of the Borrower and its Subsidiaries with respect to the
purchase of Equipment in an aggregate amount not to exceed $5,000,000 on any
date of determination;




(f)  Guaranty
Obligations in favor of the Administrative Agent for the benefit of the
Administrative Agent and the other Secured Parties;




(g)  Guaranty
Obligations with respect to Indebtedness permitted pursuant to subsections (a)
through (e) of this Section;




(h)  Indebtedness
owed by (i) any Guarantor to the Borrower, (ii) the Borrower to any Guarantor,
(iii) any Guarantor to any other Guarantor, (iv) any Subsidiary that is not a
Guarantor to any other Subsidiary that is not a Guarantor, (v) any Subsidiary
that is not a Guarantor to the Borrower or any Guarantor in an amount not to
exceed $500,000, or (vi) the Borrower or any Guarantor to any Subsidiary that is
not a Guarantor in an amount not to exceed $500,000; and




(i)  additional
unsecured Indebtedness and additional unsecured Subordinated Indebtedness, each
containing such terms and conditions as are satisfactory to the Required
Lenders; provided that in the
case of each issuance of such Indebtedness, (i) the Required Lenders shall have
consented to the issuance of such Indebtedness, (ii) no Default or Event of
Default shall have occurred and be continuing or would be caused by the issuance
of such Indebtedness, (iii) the Administrative Agent shall have received
satisfactory written evidence that the Borrower would be in compliance with all
covenants contained in this Agreement on a proforma basis after
giving effect to the issuance of any such Indebtedness, and (iv) the aggregate
amount of all such Indebtedness, shall not exceed $150,000,000 in the aggregate
at any time;




provided, that no
agreement or instrument with respect to Indebtedness permitted to be incurred by
this Section shall restrict, limit or otherwise encumber (by covenant or
otherwise) the ability of any Subsidiary of the Borrower to make any payment to
the Borrower or any Guarantor (in the form of dividends, intercompany advances
or otherwise) for the purpose of enabling the Borrower to pay the
Obligations.




Section
10.2  Limitations on
Liens .  Create,
incur, assume or suffer to exist, any Lien on or with respect to any of its
assets or properties (including, without limitation, shares of Capital Stock),
real or personal, whether now owned or hereafter acquired, except:




(a)  Liens for
taxes, assessments and other governmental charges or levies (excluding any Lien
imposed pursuant to any of the provisions of ERISA or Environmental Laws) not
yet due or as to which the period of grace (not to exceed thirty (30) days), if
any, related thereto has not expired or which are being contested in good faith
and by appropriate proceedings if adequate reserves are maintained to the extent
required by GAAP;




(b)  the
claims of materialmen, mechanics, carriers, warehousemen, processors or
landlords for labor, materials, supplies or rentals incurred in the ordinary
course of business, (i) which are not overdue for a period of more than thirty
(30) days or (ii) which are being contested in good faith and by appropriate
proceedings;




(c)  Liens
consisting of deposits or pledges made in the ordinary course of business in
connection with, or to secure payment of, obligations under workers’
compensation, unemployment insurance or similar legislation;




(d)  Liens
constituting encumbrances in the nature of zoning restrictions, easements and
rights or restrictions of record on the use of real property, which in the
aggregate so not result in a Material Adverse Effect and which do not, in any
case, detract from the value of such property or impair the use thereof in the
ordinary conduct of business;




(e)  Liens of
the Administrative Agent for the benefit of the Administrative Agent and the
other Secured Parties under the Loan Documents;




(f)  Liens not
otherwise permitted hereunder securing obligations not at any time exceeding in
the aggregate $500,000;




(g)  Liens not
otherwise permitted by this Section and in existence on the Closing Date and
described on Schedule
10.2; and




(h)  Liens
securing Indebtedness permitted under Sections 10.1(d) and
(e); provided that (i)
such Liens shall be created substantially simultaneously with the acquisition or
lease of the related asset, (ii) such Liens do not at any time encumber any
property other than the property financed by such Indebtedness, (iii) the amount
of Indebtedness secured thereby is not increased and (iv) the principal amount
of Indebtedness secured by any such Lien shall at no time exceed one hundred
percent (100%) of the original purchase price or lease payment amount of such
property at the time it was acquired.




Section
10.3  Limitations on Loans,
Advances, Investments and Acquisitions .  Purchase,
own, invest in or otherwise acquire, directly or indirectly, any Capital Stock,
interests in any partnership or joint venture (including, without limitation,
the creation or capitalization of any Subsidiary), evidence of Indebtedness or
other obligation or security, substantially all or a material portion of the
business or assets of any other Person or any other investment or interest
whatsoever in any other Person, or make or permit to exist, directly or
indirectly, any loans, advances or extensions of credit to, or any investment in
cash or by delivery of property in, any Person except:




(a)  (i)
investments as of the Closing Date in Subsidiaries existing on the Closing Date,
(ii) investments in Subsidiaries formed or acquired after the Closing Date
so long as the Borrower and its Subsidiaries comply with the applicable
provisions of Section
8.11 and (iii) the other loans, advances and investments existing on
the Closing Date which are described on Schedule
10.3;




(b)  investments
in (i) marketable direct obligations issued or unconditionally guaranteed
by the United States or any agency thereof maturing within one year from the
date of acquisition thereof, (ii) commercial paper maturing no more than
one hundred twenty (120) days from the date of creation thereof and currently
having the highest rating obtainable from either Standard & Poor’s
Ratings Services, a division of The McGraw-Hill Companies, Inc. or Moody’s
Investors Service, Inc., (iii) certificates of deposit maturing no more
than three hundred sixty four (364) days from the date of creation thereof
issued by commercial banks incorporated under the laws of the United States,
each having combined capital, surplus and undivided profits of not less than
$500,000,000 and having a rating of “A” or better by a nationally recognized
rating agency; provided, that unless
otherwise approved by the Administrative Agent, the aggregate amount invested in
such certificates of deposit shall not at any time exceed $5,000,000 for any one
such certificate of deposit and $10,000,000 for any one such bank, or
(iv) time deposits maturing no more than thirty (30) days from the date of
creation thereof with commercial banks or savings banks or savings and loan
associations each having membership either in the FDIC or the deposits of which
are insured by the FDIC and in amounts not exceeding the maximum amounts of
insurance thereunder;




(c)  investments
by the Borrower or any of its Subsidiaries in the form of non-hostile
acquisitions of all or substantially all of the business or a line of business
(whether by the acquisition of Capital Stock, assets or any combination thereof)
of any other Person if each such acquisition meets all of the foregoing
requirements:




(i)  evidence
of approval of the acquisition by the acquiree’s board of directors or
equivalent governing body or a copy of the opinion of counsel delivered by legal
counsel to the acquiree in connection with the acquisition which evidences such
approval or opines that such approval is not required shall be delivered to the
Administrative Agent at the time the documents referred to in clause (v) of this
Section 10.3(c)
are required to be delivered;




(ii)  the
Person to be acquired shall be in a substantially similar or complementary line
of business as the Borrower;




(iii)  a
description of the acquisition in the form customarily prepared by the Borrower
shall have been delivered to the Administrative Agent and the Lenders prior to
the consummation of the acquisition;




(iv)  the
Borrower shall have demonstrated to the Administrative Agent (as of the date of
the proposed acquisitions and after giving effect thereto and any Extensions of
Credit made or to be made in connection therewith) (A) compliance with each
covenant contained in and in the manner set forth in Article IX, (B) the
Total Leverage Ratio is at least 0.25 below the Total Leverage Ratio then
applicable in Section
9.1, (C) no Default or Event of Default shall have occurred and be
continuing both before and after giving effect to the proposed acquisition and
(D) the Borrower will have cash on hand plus unfunded
Commitments under the Credit Facility of at least $10,000,000;




(v)  the
Borrower shall have delivered to the Administrative Agent such documents
reasonably requested by the Administrative Agent or the Required Lenders
(through the Administrative Agent) pursuant to Section 8.11 to be
delivered at the time required pursuant to Section 8.11, said
documents to include a favorable opinion of counsel to the Borrower acceptable
to the Administrative Agent addressed to the Administrative Agent and the
Lenders with respect to the Borrower, the Person to be acquired and the
acquisition in form and substance reasonably acceptable to the Administrative
Agent; and;




(vi)  the
Borrower or any Domestic Subsidiary shall be the surviving Person and no Change
of Control shall have been effected thereby;




(vii)  the
Borrower shall provide such other documents and other information as may be
reasonably requested by the Administrative Agent or the Required Lenders
(through the Administrative Agent) in connection with the proposed
acquisition;




(viii)  as of the
date of such acquisition, there is no material litigation pending or threatened;
and




(ix)  the total
aggregate consideration (including, without limitation, all cash consideration,
assumed debt, earn-outs (valued at an amount reasonably determined in good faith
by the Borrower to be payable in connection with such earn-outs) and deferred
payments) to be paid by the Borrower and its Subsidiaries in connection with
such acquisition, or series of related acquisitions, does not exceed $40
million;




(d)  Hedging
Agreements permitted pursuant to Section
10.1;




(e)  purchases
of assets in the ordinary course of business;




(f)  intercompany
Indebtedness permitted pursuant to Section 10.1(h);
and




(g)  other
additional investments not otherwise permitted pursuant to this Section not
exceeding $1,000,000in the aggregate in any
Fiscal Year.




Section
10.4  Limitations on Mergers and
Liquidation .  Merge,
consolidate or enter into any similar combination with any other Person or
liquidate, wind-up or dissolve itself (or suffer any liquidation or dissolution)
except:




(a)  any
Wholly-Owned Subsidiary of the Borrower may be merged or consolidated with or
into the Borrower (provided that the
Borrower shall be the continuing or surviving Person) or with or into any
Guarantor (provided that the
Guarantor shall be the continuing or surviving Person);




(b)  any
Wholly-Owned Subsidiary may sell, lease, transfer or otherwise dispose of any or
all of its assets (upon voluntary liquidation or otherwise) to the Borrower or
any other Wholly-Owned Subsidiary; provided that (i) if
the transferor in such a transaction is a Guarantor, then the transferee must
either be the Borrower or a Guarantor and (ii) if the transferee is either the
Borrower or a Guarantor, such sale, lease, transfer or other disposition shall
not be for an amount greater than the fair market value;




(c)  any
Wholly-Owned Subsidiary of the Borrower may merge into the Person such
Wholly-Owned Subsidiary was formed to acquire in connection with a Permitted
Acquisition; and




(d)  any
Subsidiary of the Borrower may wind-up into the Borrower or any
Guarantor.




Section
10.5  Limitations on Sale of
Assets .  Convey,
sell, lease, assign, transfer or otherwise dispose of any of its property,
business or assets (including, without limitation, the sale of any receivables
and leasehold interests and any sale-leaseback or similar transaction), whether
now owned or hereafter acquired except:




(a)  the sale
of inventory in the ordinary course of business;




(b)  the sale
of obsolete assets no longer used or usable in the business of the Borrower or
any of its Subsidiaries;




(c)  the
transfer of assets to the Borrower or any Guarantor pursuant to Section
10.4(d);




(d)  the sale
or discount without recourse of accounts receivable arising in the ordinary
course of business in connection with the compromise or collection
thereof;




(e)  the
disposition of any Hedging Agreement; and




(f)  additional
dispositions of assets not otherwise permitted pursuant to this Section in an
aggregate amount not to exceed $500,000in any Fiscal
Year.




Section
10.6  Limitations on Dividends and
Distributions .  Declare
or pay any dividends upon any of its Capital Stock; purchase, redeem, retire or
otherwise acquire, directly or indirectly, any shares of its Capital Stock, or
make any distribution of cash, property or assets among the holders of shares of
its Capital Stock, or make any change in its capital structure; provided
that:




(a)  the
Borrower or any Subsidiary may pay dividends in shares of its own Capital Stock;
and




(b)  any
Subsidiary may pay cash dividends to the Borrower.




Section
10.7  Limitations on Exchange and
Issuance of Capital Stock .  Issue,
sell or otherwise dispose of any class or series of Capital Stock that, by its
terms or by the terms of any security into which it is convertible or
exchangeable, is, or upon the happening of an event or passage of time would be,
(a) convertible or exchangeable into Indebtedness or (b) required to be redeemed
or repurchased, including at the option of the holder, in whole or in part, or
has, or upon the happening of an event or passage of time would have, a
redemption or similar payment due.




Section
10.8  Transactions with
Affiliates .  Except
for transactions permitted by Sections 10.3, 10.6 and 10.7, and except as
set forth in Schedule
10.8, directly or indirectly (a) make any loan or advance to, or purchase
or assume any note or other obligation to or from, any of its officers,
directors, shareholders or other Affiliates, or to or from any member of the
immediate family of any of its officers, directors, shareholders or other
Affiliates, or subcontract any operations to any of its Affiliates or (b) enter
into, or be a party to, any other transaction not described in clause (a) above
with any of its Affiliates, except pursuant to the reasonable requirements of
its business and upon fair and reasonable terms that are fully disclosed to the
Required Lenders prior to the consummation thereof and are no less favorable to
it than it would obtain in a comparable arm’s length transaction with a Person
not its Affiliate.




Section
10.9  Certain Accounting Changes;
Organizational Documents .  (a)
Change its Fiscal Year end, or make any change in its accounting treatment and
reporting practices except as required by GAAP or (b) amend, modify or change
its articles of incorporation (or corporate charter or other similar
organizational documents) or amend, modify or change its bylaws (or other
similar documents) in any manner adverse in any respect to the rights or
interests of the Lenders.




Section
10.10  Amendments; Payments and
Prepayments of Subordinated Indebtedness .




(a)  Amend or
modify (or permit the modification or amendment of) any of the terms or
provisions of any Subordinated Indebtedness in any respect which would
materially adversely affect the rights or interests of the Administrative Agent
and Lenders hereunder.




(b)  Cancel,
forgive, make any payment or prepayment on, or redeem or acquire for value
(including, without limitation, (i) by way of depositing with any trustee with
respect thereto money or securities before due for the purpose of paying when
due and (ii) at the maturity thereof) any Subordinated Indebtedness, except
refinancings, refundings, renewals, extensions or exchange of any Subordinated
Indebtedness permitted by Section
10.1(i).




Section
10.11  Restrictive
Agreements .




(a)  Enter
into any Indebtedness which contains any negative pledge on assets or any
covenants more restrictive than the provisions of Articles VIII, IX and X hereof, or which
restricts, limits or otherwise encumbers its ability to incur Liens on or with
respect to any of its assets or properties other than the assets or properties
securing such Indebtedness.




(b)  Enter
into or permit to exist any agreement which impairs or limits the ability of any
Subsidiary of the Borrower to pay dividends to the Borrower.




Section
10.12  Nature of
Business .  Alter
in any material respect the character or conduct of the business conducted by
the Borrower and its Subsidiaries as of the Closing Date.




Section
10.13  Impairment of Security
Interests . Take or
omit to take any action, which might or would have the result of materially
impairing the security interests in favor of the Administrative Agent with
respect to the Collateral or grant to any Person (other than the Administrative
Agent, for the benefit of itself and the other Secured Parties, pursuant to the
Security Documents) any interest whatsoever in the Collateral, except for
Permitted Liens and asset dispositions permitted under Section
10.5.




Section
10.14  Amendments and Other
Documents .  Amend,
modify, waive or supplement (or permit modification, amendment, waiver or
supplement of) any of the terms or provisions of (a) the documents evidencing
the Acquisition, (b) the Employment Agreements or (c) any other Related
Document, in each case in any respect that would materially and adversely affect
the rights or interests of the Administrative Agent and the Lenders hereunder,
in each, without the prior written consent of the Administrative
Agent




ARTICLE
XI


DEFAULT AND
REMEDIES




Section
11.1  Events of
Default .  Each
of the following shall constitute an Event of Default, whatever the reason for
such event and whether it shall be voluntary or involuntary or be effected by
operation of law or pursuant to any judgment or order of any court or any order,
rule or regulation of any Governmental Authority or otherwise:




(a)  Default in Payment of
Principal of Loans and Reimbursement Obligations.  The Borrower
shall default in any payment of principal of any Loan or Reimbursement
Obligation when and as due (whether at maturity, by reason of acceleration or
otherwise).




(b)  Other Payment
Default.  The Borrower or any other Credit Party shall default
in the payment when and as due (whether at maturity, by reason of acceleration
or otherwise) of interest on any Loan or Reimbursement Obligation or the payment
of any other Obligation, and such default shall continue for a period of three
(3) Business Days.




(c)  Misrepresentation.  Any
representation, warranty, certification or statement of fact made or deemed made
by or on behalf of any Credit Party or any Subsidiary thereof in this Agreement,
in any other Loan Document, or in any document delivered in connection herewith
or therewith that is subject to materiality or Material Adverse Effect
qualifications, shall be incorrect or misleading in any respect when made or
deemed made or any representation, warranty, certification or statement of fact
made or deemed made by or on behalf of any Credit Party or any Subsidiary
thereof in this Agreement, any other Loan Document, or in any document delivered
in connection herewith or therewith that is not subject to materiality or
Material Adverse Effect qualifications, shall be incorrect or misleading in any
material respect when made or deemed made.




(d)  Default in Performance of
Certain Covenants.  The Borrower or any other Credit Party
shall default in the performance or observance of any covenant or agreement
contained in Sections
5.4, 7.1, 7.2 or 7.4(e)(i) or Articles IX or X of this
Agreement.




(e)  Default in Performance of
Other Covenants and Conditions.  The Borrower or any other
Credit Party shall default in the performance or observance of any term,
covenant, condition or agreement contained in this Agreement (other than as
specifically provided for otherwise in this Section) or any other Loan Document
and such default shall continue for a period of thirty (30) days after written
notice thereof has been given to the Borrower by the Administrative
Agent.




(f)  Hedging
Agreement.  The Borrower or any other Credit Party shall
default in the performance or observance of any term, covenant, condition or
agreement (after giving effect to any applicable grace or cure period) under any
Hedging Agreement and such default causes the termination of such Hedging
Agreement and the Termination Value owed by such Credit Party as a result
thereof exceeds $500,000.




(g)  Indebtedness
Cross-Default.  The Borrower or any other Credit Party shall
(i) default in the payment of any Indebtedness (other than the Loans or any
Reimbursement Obligation) the aggregate outstanding amount of which Indebtedness
is in excess of $1,000,000 beyond the period of grace if any, provided in the
instrument or agreement under which such Indebtedness was created, or (ii)
default in the observance or performance of any other agreement or condition
relating to any Indebtedness (other than the Loans or any Reimbursement
Obligation) the aggregate outstanding amount of which Indebtedness is in excess
of $1,000,000 or contained in any instrument or agreement evidencing, securing
or relating thereto or any other event shall occur or condition exist, the
effect of which default or other event or condition is to cause, or to permit
the holder or holders of such Indebtedness (or a trustee or agent on behalf of
such holder or holders) to cause, with the giving of notice if required, any
such Indebtedness to become due prior to its stated maturity (any applicable
grace period having expired).




(h)  Other
Cross-Defaults.  The Borrower or any other Credit Party shall
default in the payment when due, or in the performance or observance, of any
obligation or condition of any Material Contract beyond the period of grace, if
any, contained in such Material Contract, which default, individually or in the
aggregate, could reasonably be expected to have a Material Adverse Effect,
unless, but only as long as, the existence of any such default is being
contested by the Borrower or such Credit Party in good faith by appropriate
proceedings and adequate reserves in respect thereof have been established on
the books of the Borrower or such Credit Party to the extent required by
GAAP.




(i)  Change in
Control.  A Change in Control shall occur.




(j)  Voluntary Bankruptcy
Proceeding.  The Borrower or any Subsidiary thereof shall (i)
commence a voluntary case under the federal bankruptcy laws (as now or hereafter
in effect), (ii) file a petition seeking to take advantage of any other laws,
domestic or foreign, relating to bankruptcy, insolvency, reorganization, winding
up or composition for adjustment of debts, (iii) consent to or fail to contest
in a timely and appropriate manner any petition filed against it in an
involuntary case under such bankruptcy laws or other laws, (iv) apply for or
consent to, or fail to contest in a timely and appropriate manner, the
appointment of, or the taking of possession by, a receiver, custodian, trustee,
or liquidator of itself or of a substantial part of its property, domestic or
foreign, (v) admit in writing its inability to pay its debts as they become due,
(vi) make a general assignment for the benefit of creditors, or (vii) take any
corporate action for the purpose of authorizing any of the
foregoing.




(k)  Involuntary Bankruptcy
Proceeding.  A case or other proceeding shall be commenced
against the Borrower or any Credit Party thereof in any court of competent
jurisdiction seeking (i) relief under the federal bankruptcy laws (as now or
hereafter in effect) or under any other laws, domestic or foreign, relating to
bankruptcy, insolvency, reorganization, winding up or adjustment of debts, or
(ii) the appointment of a trustee, receiver, custodian, liquidator or the like
for the Borrower or any Credit Party thereof or for all or any substantial part
of their respective assets, domestic or foreign, and such case or proceeding
shall continue without dismissal or stay for a period of sixty (60) consecutive
days, or an order granting the relief requested in such case or proceeding
(including, but not limited to, an order for relief under such federal
bankruptcy laws) shall be entered.




(l)  Failure of
Agreements.  Any material provision of this Agreement or any
provision of any other Loan Document shall for any reason cease to be valid and
binding on the Borrower or any other Credit Party party thereto (except in the
event this Agreement or other Loan Document is, by its terms, terminated and no
longer in force) or any such Person shall so state in writing, or any Loan
Document shall for any reason cease to create a valid and perfected first
priority Lien on, or security interest in, any of the Collateral purported to be
covered thereby, in each case other than in accordance with the express terms
hereof or thereof.




(m)  Termination
Event.  The occurrence of any of the following
events:  (i) the Borrower or any ERISA Affiliate fails to make full
payment when due of all amounts which, under the provisions of any Pension Plan
or Section 412 of the Code, the Borrower or any ERISA Affiliate is required to
pay as contributions thereto, (ii) an accumulated funding deficiency in excess
of $2,000,000 occurs or exists, whether or not waived, with respect to any
Pension Plan, (iii) a Termination Event or (iv) the Borrower or any ERISA
Affiliate as employers under one or more Multiemployer Plans makes a complete or
partial withdrawal from any such Multiemployer Plan and the plan sponsor of such
Multiemployer Plans notifies such withdrawing employer that such employer has
incurred a withdrawal liability requiring payments in an amount exceeding
$2,000,000.




(n)  Judgment.  A
judgment or order for the payment of money which causes the aggregate amount of
all such judgments to exceed $2,000,000 in any Fiscal Year (to the extent not
covered by independent third party insurance as to which the insurer does not
dispute coverage) shall be entered against the Borrower or any Credit Party by
any court and such judgment or order shall continue without having been
discharged, vacated, stayed or bonded pending appeal for a period of thirty (30)
days after the entry thereof.




(o)  Environmental.  Any
one or more Environmental Claims shall have been asserted against the Borrower
or any Credit Party; the Borrower and any Credit Party would be reasonably
likely to incur liability as a result thereof; and such liability would be
reasonably likely, individually or in the aggregate, to have a Material Adverse
Effect.




(p)  Material Permits and
Licenses.  The loss, suspension or revocation of, or failure to
renew, any license, accreditation or permit now held or hereafter acquired by
the Credit Party or any Subsidiary thereof if such loss, suspension, revocation
or failure to renew would have a Material Adverse Effect; or the occurrence of
any other Material Adverse Effect.




Section
11.2  Remedies .  Upon
the occurrence of an Event of Default, with the consent of the Required Lenders,
the Administrative Agent may, or upon the request of the Required Lenders, the
Administrative Agent shall, by notice to the Borrower:




(a)  Acceleration; Termination of
Facilities.  Terminate the Commitments and declare the
principal of and interest on the Loans and the Reimbursement Obligations at the
time outstanding, and all other amounts owed to the Lenders and to the
Administrative Agent under this Agreement or any of the other Loan Documents
(including, without limitation, all L/C Obligations, whether or not the
beneficiaries of the then outstanding Letters of Credit shall have presented or
shall be entitled to present the documents required thereunder) and all other
Obligations (other than Specified Obligations), to be forthwith due and payable,
whereupon the same shall immediately become due and payable without presentment,
demand, protest or other notice of any kind, all of which are expressly waived
by each Credit Party, anything in this Agreement or the other Loan Documents to
the contrary notwithstanding, and terminate the Credit Facility and any right of
the Borrower to request borrowings or Letters of Credit thereunder; provided, that upon
the occurrence of a Bankruptcy Event of Default, the Credit Facility shall be
automatically terminated and all Obligations (other than Specified Obligations)
shall automatically become due and payable without presentment, demand, protest
or other notice of any kind, all of which are expressly waived by each Credit
Party, anything in this Agreement or in any other Loan Document to the contrary
notwithstanding.




(b)  Letters of
Credit.  With respect to all Letters of Credit with respect to
which presentment for honor shall not have occurred at the time of an
acceleration pursuant to the preceding paragraph, the Borrower shall at such
time deposit in a cash collateral account opened by the Administrative Agent an
amount equal to the aggregate then undrawn and unexpired amount of such Letters
of Credit.  Amounts held in such cash collateral account shall be
applied by the Administrative Agent to the payment of drafts drawn under such
Letters of Credit, and the unused portion thereof after all such Letters of
Credit shall have expired or been fully drawn upon, if any, shall be applied to
repay the other Obligations on a pro rata
basis.  After all such Letters of Credit shall have expired or been
fully drawn upon, the Reimbursement Obligation shall have been satisfied and all
other Obligations shall have been paid in full, the balance, if any, in such
cash collateral account shall be returned to the Borrower.




(c)  Rights of
Collection.  Exercise on behalf of the Lenders all of its other
rights and remedies under this Agreement, the other Loan Documents and
Applicable Law, in order to satisfy all of the Borrower’s
Obligations.




Section
11.3  Rights and Remedies
Cumulative; Non-Waiver; etc .  The
enumeration of the rights and remedies of the Administrative Agent and the
Lenders set forth in this Agreement is not intended to be exhaustive and the
exercise by the Administrative Agent and the Lenders of any right or remedy
shall not preclude the exercise of any other rights or remedies, all of which
shall be cumulative, and shall be in addition to any other right or remedy given
hereunder or under the other Loan Documents or that may now or hereafter exist
at law or in equity or by suit or otherwise.  No delay or failure to
take action on the part of the Administrative Agent or any Lender in exercising
any right, power or privilege shall operate as a waiver thereof, nor shall any
single or partial exercise of any such right, power or privilege preclude any
other or further exercise thereof or the exercise of any other right, power or
privilege or shall be construed to be a waiver of any Event of
Default.  No course of dealing between the  Borrower, the
Administrative Agent and the Lenders or their respective agents or employees
shall be effective to change, modify or discharge any provision of this
Agreement or any of the other Loan Documents or to constitute a waiver of any
Event of Default.




Section
11.4  Crediting of Payments and
Proceeds .  In
the event that the Borrower shall fail to pay any of the Obligations when due
and the Obligations have been accelerated pursuant to Section 11.2, all
payments received by the Lenders upon the Obligations and all net proceeds from
the enforcement of the Obligations shall be applied:




First, to payment of
that portion of the Obligations constituting fees, indemnities, expenses and
other amounts, including attorney fees, payable to the Administrative Agent in
its capacity as such and each Issuing Lender in its capacity as such (ratably
among the Administrative Agent and such Issuing Lender in proportion to the
respective amounts described in this clause First payable to
them);




Second, to payment of
that portion of the Obligations constituting fees, indemnities and other amounts
(other than principal and interest) payable to the Lenders, including attorney
fees (ratably among the Lenders in proportion to the respective amounts
described in this clause Second payable to
them);




Third, to payment of
that portion of the Obligations constituting accrued and unpaid interest on the
Loans and Reimbursement Obligations (ratably among the Lenders in proportion to
the respective amounts described in this clause Third payable to
them);




Fourth, to payment of
that portion of the Obligations constituting unpaid principal of the Loans,
Reimbursement Obligations and Specified Obligations (including any termination
payments and any accrued and unpaid interest thereon) (ratably among the Lenders
and counterparties to the respective Specified Obligations in proportion to the
respective amounts described in this clause Fourth held by
them);




Fifth, to the
Administrative Agent for the account of the applicable Issuing Lender, to cash
collateralize any L/C Obligations then outstanding; and




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




Section
11.5  Administrative Agent May
File Proofs of Claim .  In
case of the pendency of any receivership, insolvency, liquidation, bankruptcy,
reorganization, arrangement, adjustment, composition or other judicial
proceeding relative to any Credit Party, the Administrative Agent (irrespective
of whether the principal of any Loan or L/C Obligation shall then be due and
payable as herein expressed or by declaration or otherwise and irrespective of
whether the Administrative Agent shall have made any demand on the Borrower)
shall be entitled and empowered to, and if required by the Required Lenders
shall, by intervention in such proceeding or otherwise:




(a)  file and
prove a claim for the whole amount of the principal and interest owing and
unpaid in respect of the Loans, L/C Obligations and all other Obligations that
are owing and unpaid and to file such other documents as may be necessary or
advisable in order to have the claims of the Lenders and the Administrative
Agent (including any claim for the reasonable compensation, expenses,
disbursements and advances of the Lenders and the Administrative Agent and their
respective agents and counsel and all other amounts due the Lenders and the
Administrative Agent under Sections 3.3, 4.3 and 13.3) allowed in such
judicial proceeding; and




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




and any
custodian, receiver, assignee, trustee, liquidator, sequestrator or other
similar official in any such judicial proceeding is hereby authorized by each
Lender to make such payments to the Administrative Agent and, in the event that
the Administrative Agent shall consent to the making of such payments directly
to the Lenders, to pay to the Administrative Agent any amount due for the
reasonable compensation, expenses, disbursements and advances of the
Administrative Agent and its agents and counsel, and any other amounts due the
Administrative Agent under Sections 4.3 and
13.3.




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




ARTICLE
XII


THE ADMINISTRATIVE
AGENT




Section
12.1  Appointment .  Each
of the Lenders hereby irrevocably designates and appoints Wachovia to act on its
behalf as the Administrative Agent of such Lender under this Agreement and the
other Loan Documents for the term hereof and each such Lender irrevocably
authorizes Wachovia, as Administrative Agent for such Lender, to take such
action on its behalf under the provisions of this Agreement and the other Loan
Documents and to exercise such powers and perform such duties as are expressly
delegated to the Administrative Agent by the terms of this Agreement and such
other Loan Documents, together with such other powers as are reasonably
incidental thereto.  Notwithstanding any provision to the contrary
elsewhere in this Agreement or such other Loan Documents, the Administrative
Agent shall not have any duties or responsibilities, except those expressly set
forth herein and therein, or any fiduciary relationship with any Lender, and no
implied covenants, functions, responsibilities, duties, obligations or
liabilities shall be read into this Agreement or the other Loan Documents or
otherwise exist against the Administrative Agent.  Any reference to
the Administrative Agent in this Article XII shall be
deemed to refer to the Administrative Agent solely in its capacity as
Administrative Agent and not in its capacity as a Lender.




Section
12.2  Delegation of
Duties .  The
Administrative Agent may execute any of its respective duties under this
Agreement and the other Loan Documents by or through agents or attorneys-in-fact
and shall be entitled to advice of counsel concerning all matters pertaining to
such duties.  The Administrative Agent shall not be responsible for
the negligence or misconduct of any agents or attorneys-in-fact selected by the
Administrative Agent with reasonable care.




Section
12.3  Exculpatory
Provisions .  Neither
the Administrative Agent nor any of its officers, directors, employees, agents,
attorneys-in-fact, Subsidiaries or Affiliates shall be (a) liable for any action
lawfully taken or omitted to be taken by it or such Person under or in
connection with this Agreement or the other Loan Documents (except for actions
occasioned solely by its or such Person’s own gross negligence or willful
misconduct), or (b) responsible in any manner to any of the Lenders for any
recitals, statements, representations or warranties made by the Borrower or any
of the Credit Parties or any officer thereof contained in this Agreement or the
other Loan Documents or in any certificate, report, statement or other document
referred to or provided for in, or received by the Administrative Agent under or
in connection with, this Agreement or the other Loan Documents or for the value,
validity, effectiveness, genuineness, enforceability or sufficiency of this
Agreement or the other Loan Documents or for any failure of the Borrower or any
of the Credit Parties to perform its obligations hereunder or
thereunder.  The Administrative Agent shall not be under any
obligation to any Lender to ascertain or to inquire as to the observance or
performance of any of the agreements contained in, or conditions of, this
Agreement, or to inspect the properties, books or records of the Borrower or any
of the Credit Parties.




Section
12.4  Reliance by the
Administrative Agent .




(a)  The
Administrative Agent shall be entitled to rely, and shall be fully protected in
relying, upon any note, writing, resolution, notice, consent, certificate,
affidavit, letter, cablegram, telegram, telecopy, telex or teletype message,
statement, order or other document or conversation believed by it to be genuine
and correct and to have been signed, sent or made by the proper Person or
Persons and upon advice and statements of legal counsel (including, without
limitation, counsel to the Borrower), independent accountants and other experts
selected by the Administrative Agent.  The Administrative Agent shall
be fully justified in failing or refusing to take any action under this
Agreement and the other Loan Documents unless it shall first receive such advice
or concurrence of the Required Lenders (or, when expressly required hereby or by
the relevant other Loan Documents, all the Lenders) as it deems appropriate or
it shall first be indemnified to its satisfaction by the Lenders against any and
all liability and expense which may be incurred by it by reason of taking or
continuing to take any such action except for its own gross negligence or
willful misconduct.  The Administrative Agent shall in all cases be
fully protected in acting, or in refraining from acting, under this Agreement in
accordance with a request of the Required Lenders (or, when expressly required
hereby, all the Lenders), and such request and any action taken or failure to
act pursuant thereto shall be binding upon all the Lenders.




(b)  For
purposes of determining compliance with the conditions specified in Section 5.2, each
Lender that has signed this Agreement shall be deemed to have consented to,
approved or accepted or to be satisfied with, each document or other matter
required thereunder to be consented to or approved by or acceptable or
satisfactory to a Lender unless the Administrative Agent shall have received
notice from such Lender prior to the proposed Closing Date specifying its
objection thereto.




Section
12.5  Notice of
Default .  The
Administrative Agent shall not be deemed to have knowledge or notice of the
occurrence of any Default or Event of Default unless it has received notice from
a Lender or the Borrower referring to this Agreement, describing such Default or
Event of Default and stating that such notice is a “notice of
default”.  In the event that the Administrative Agent receives such a
notice, it shall promptly give notice thereof to the Lenders.  The
Administrative Agent shall take such action with respect to such Default or
Event of Default as shall be reasonably directed by the Required Lenders (or,
when expressly required hereby, all the Lenders); provided that unless
and until the Administrative Agent shall have received such directions, the
Administrative Agent may (but shall not be obligated to) take such action, or
refrain from taking such action, with respect to such Default or Event of
Default as it shall deem advisable in the best interests of the Lenders, except to the extent
that other provisions of this Agreement expressly require that any such action
be taken or not be taken only with the consent and authorization or the request
of the Lenders or Required Lenders, as applicable.




Section
12.6  Non-Reliance on the
Administrative Agent and Other Lenders .  Each
Lender expressly acknowledges that neither the Administrative Agent nor any of
its respective officers, directors, employees, agents, attorneys-in-fact,
Subsidiaries or Affiliates has made any representations or warranties to it and
that no act by the Administrative Agent hereafter taken, including any review of
the affairs of the  Borrower or any Credit Party, shall be deemed to
constitute any representation or warranty by the Administrative Agent to any
Lender.  Each Lender represents to the Administrative Agent that it
has, independently and without reliance upon the Administrative Agent or any
other Lender, and based on such documents and information as it has deemed
appropriate, made its own appraisal of and investigation into the business,
operations, property, financial and other condition and creditworthiness of the
Borrower and its Subsidiaries and made its own decision to make its Loans and
issue or participate in Letters of Credit hereunder and enter into this
Agreement.  Each Lender also represents that it will, independently
and without reliance upon the Administrative 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 analysis, appraisals and decisions in
taking or not taking action under this Agreement and the other Loan Documents,
and to make such investigation as it deems necessary to inform itself as to the
business, operations, property, financial and other condition and
creditworthiness of the Borrower or any Credit Party.  Except for
notices, reports and other documents expressly required to be furnished to the
Lenders by the Administrative Agent hereunder or by the other Loan Documents,
the Administrative Agent shall not have any duty or responsibility to provide
any Lender with any credit or other information concerning the business,
operations, property, financial and other condition or creditworthiness of the
Borrower or any of the Credit Parties which may come into the possession of the
Administrative Agent or any of its respective officers, directors, employees,
agents, attorneys-in-fact, Subsidiaries or Affiliates.




Section
12.7  Indemnification .  The
Lenders agree to indemnify the Administrative Agent in its capacity as such and
(to the extent not reimbursed by the Borrower and without limiting the
obligation of the Borrower to do so), ratably according to the respective
amounts of their Commitment Percentages from and against any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements of any kind whatsoever which may at any time
(including, without limitation, at any time following the payment of the Loans
or any Reimbursement Obligation) be imposed on, incurred by or asserted against
the Administrative Agent in any way relating to or arising out of this Agreement
or the other Loan Documents, or any documents, reports or other information
provided to the Administrative Agent or any Lender or contemplated by or
referred to herein or therein or the transactions contemplated hereby or thereby
or any action taken or omitted by the Administrative Agent under or in
connection with any of the foregoing; provided that no
Lender shall be liable for the payment of any portion of such liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements to the extent resulting from the Administrative
Agent’s bad faith, gross negligence or willful misconduct.  The
agreements in this Section shall survive the payment of the Obligations and the
termination of this Agreement.




Section
12.8  The Administrative Agent in
Its Individual Capacity .  The
Administrative Agent and its respective Subsidiaries and Affiliates may make
loans to, accept deposits from and generally engage in any kind of business with
the Borrower as though the Administrative Agent were not the Administrative
Agent hereunder.  With respect to any Loans made or renewed by it and
with respect to any Letter of Credit issued by it or participated in by it, the
Administrative Agent shall have the same rights and powers under this Agreement
and the other Loan Documents as any Lender and may exercise the same as though
it were not the Administrative Agent, and the terms “Lender” and “Lenders” shall
include the Administrative Agent in its individual capacity.




Section
12.9  Resignation of the
Administrative Agent; Successor Administrative Agent .




(a)  Subject
to the appointment and acceptance of a successor as provided below, Wachovia may
resign as the Administrative Agent at any time by giving notice thereof to the
Lenders and the Borrower.  Upon any such resignation, the Required
Lenders shall appoint from among the Lenders a successor administrative agent
for the Lenders, which successor administrative agent shall be consented to by
the Borrower at all times other than during the existence of an Event of Default
(which consent of the Borrower shall not be unreasonably withheld or
delayed).  If no successor administrative agent shall have been so
appointed by the Required Lenders and shall have accepted such appointment
within thirty (30) days after the Administrative Agent’s giving of notice of
resignation, then the Administrative Agent may, on behalf of the Lenders,
appoint a successor administrative agent.  Upon the acceptance of any
appointment as Administrative Agent hereunder by a successor administrative
agent, such successor administrative agent shall thereupon succeed to and become
vested with all rights, powers, privileges and duties of the retiring
Administrative Agent and the retiring Administrative Agent shall be discharged
from its duties and obligations hereunder without any other or further act or
deed on the part of such retiring Administrative Agent or any other
Lender.  After any retiring Administrative Agent’s resignation
hereunder as Administrative Agent, the provisions of this Article XII and Section 13.3
shall inure to its benefit as to any actions taken or omitted to be taken by it
while it was Administrative Agent under this Agreement.  If no
successor administrative agent has accepted appointment as Administrative Agent
by the date which is thirty (30) days following a retiring Administrative
Agent’s notice of resignation, the retiring Administrative Agent’s resignation
shall nevertheless thereupon become effective and the Lenders shall perform all
of the duties of the Administrative Agent hereunder until such time, if any, as
the Required Lenders appoint a successor agent as provided for
above.




(b)  Notwithstanding
anything to the contrary contained herein, (A) Wachovia may, upon thirty (30)
days’ notice to the Borrower, resign as Swingline Lender and (B) any Issuing
Lender may, upon thirty (30) days’ notice to the Borrower, the Administrative
Agent and the Lenders, resign as an Issuing Lender.  In the event of
any such resignation as Issuing Lender or Swingline Lender, the Borrower shall
be entitled to appoint from among the Lenders, subject to acceptance of such
appointment by the Lender so chosen, a successor Issuing Lender or Swingline
Lender hereunder; provided that no
failure by the Borrower to appoint any such successor shall affect the
resignation of Wachovia as Swingline Lender or the resignation of any Issuing
Lender as an Issuing Lender, as the case may be.  If any Issuing
Lender resigns as an Issuing Lender, it shall retain all the rights and
obligations of an Issuing Lender hereunder with respect to all Letters of Credit
outstanding as of the effective date of its resignation as an Issuing Lender and
all L/C Obligations with respect thereto, including the right to require the
Lenders to make Revolving Credit Loans or fund risk participations for
unreimbursed amounts of Letters of Credit pursuant to Section
3.4.  If Wachovia resigns as Swingline Lender, it shall retain
all the rights of the Swingline Lender provided for hereunder with respect to
Swingline Loans made by it and outstanding as of the effective date of such
resignation, including the right to require the Lenders to make Revolving Credit
Loans or fund risk participations in outstanding Swingline Loans pursuant to
Section
2.2(b).




Section
12.10  Collateral and Guaranty
Matters .  The
Lenders irrevocably authorize the Administrative Agent, at its option and in its
discretion (without notice to, or vote or consent of, any counterparty to any
Specified Hedge Agreement or Specified Cash Management Agreement that was a
Lender or an Affiliate of any Lender at the time such agreement was
executed):




(a)  to
release any Lien on any Collateral granted to or held by the Administrative
Agent, for the ratable benefit of itself and the other Secured Parties (whether
or not on the date of such release there may be outstanding Specified
Obligations or contingent or indemnification obligations not then due), under
any Loan Document (i) upon repayment of the outstanding principal of and all
accrued interest on the Loans, payment of all outstanding fees and expenses
hereunder, the termination of the Lenders’ Commitments and the expiration or
termination of all Letters of Credit, (ii) that is sold or to be sold as part of
or in connection with any sale permitted hereunder or under any other Loan
Document, or (iii) subject to Section 13.2, if
approved, authorized or ratified in writing by the Required
Lenders;




(b)  to
subordinate any Lien on any Collateral (whether or not on the date of such
release there may be outstanding Specified Obligations or contingent or
indemnification obligations not then due) granted to or held by the
Administrative Agent under any Loan Document to the holder of any Lien on such
Collateral that is permitted by Section 10.2(g);
and




(c)  to
release any Guarantor (whether or not on the date of such release there may be
outstanding Specified Obligations or contingent or indemnification obligations
not then due) from its obligations under the Guaranty Agreement if such Person
ceases to be a Subsidiary as a result of a transaction permitted
hereunder.




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




Section
12.11  Other Agents, Arrangers and
Managers .  None
of the Lenders or other Persons identified on the facing page or signature pages
of this Agreement as a “syndication agent,” “documentation agent,” “co-agent,”
“book manager,” “lead manager,” “arranger,” “lead arranger” or “co-arranger”
shall have any right, power, obligation, liability, responsibility or duty under
this Agreement other than, in the case of such Lenders, those applicable to all
Lenders as such.  Without limiting the foregoing, none of the Lenders
or other Persons so identified shall have or be deemed to have any fiduciary
relationship with any Lender.  Each Lender acknowledges that it has
not relied, and will not rely, on any of the Lenders or other Persons so
identified in deciding to enter into this Agreement or in taking or not taking
action hereunder.




ARTICLE
XIII


MISCELLANEOUS




Section
13.1  Notices .




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







If
      to the Borrower:
            LMI
      Aerospace, Inc.
              411
      Fountain Lakes Blvd.
              St.
      Charles, Missouri  63301
              Attention:  Lawrence
      E. Dickinson
              Telephone
      No.: (636) 916-2150
              Telecopy
      No.: (636) 949-1576
              E-mail:  edickinson@lmiaerospace.com
              Webpage:  www.lmiaerospace.comWith
      copies to:
            Gallop,
      Johnson & Neuman, L.C.
              101
      South Hanley, Suite 1700
              St.
      Louis, Missouri 63105
              Attention:
      John P. Walsh, Esq.
              Telephone
      No.: (314) 615-6263
              Telecopy
      No.: (314) 615-6001
              E-mail:  jpwalsh@gjn.comIf
      to Wachovia as
              Administrative
      Agent:
            Wachovia
      Bank, National Association
              Charlotte
      Plaza, CP-8
              201
      South College Street
              Charlotte,
      North Carolina 28288-0680
              Attention:  Syndication
      Agency Services
              Telephone
      No.:  (704) 374-2698
              Telecopy
      No.:  (704) 383-0288With
      copies to:
            1
      South Broad Street
              PA4843
              Philadelphia,
      Pennsylvania 19107
              Attention:
      William F. Fox
              Telephone
      No.: (267) 321-6612
              Telecopy
      No.: (267) 321-6700
              E-mail:                        bill.fox@wachovia.comIf
      to any Lender:
            To
      the address set forth on the
Register




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




(b)  Electronic
Communications.




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




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




(c)  Administrative Agent’s
Office.  The Administrative Agent hereby designates its office
located at the address set forth above, or any subsequent office which shall
have been specified for such purpose by written notice to the Borrower and
Lenders, as the Administrative Agent’s Office referred to herein, to which
payments due are to be made and at which Loans will be disbursed and Letters of
Credit requested.




(d)  Change of Address,
Etc.  Any party hereto may change its address or telecopier
number for notices and other communications hereunder by notice to the other
parties hereto.




Section
13.2  Amendments, Waivers and
Consents .  Except
as set forth below or as specifically provided in any Loan Document, any term,
covenant, agreement or condition of this Agreement or any of the other Loan
Documents may be amended or waived by the Lenders, and any consent given by the
Lenders, if, but only if, such amendment, waiver or consent is in writing signed
by the Required Lenders (or by the Administrative Agent with the consent of the
Required Lenders) and delivered to the Administrative Agent and, in the case of
an amendment, signed by the Borrower; provided, that no
amendment, waiver or consent shall:




(a)  waive any
condition set forth in Section 5.2 without
the written consent of each Lender directly affected thereby;




(b)  amend
Section 11.1 or
waive any of the conditions set forth in Section 5.3 or waive
any Default or Event of Default for purposes of waiving any of the conditions
set forth in Section
5.3 without the prior written consent of any combination of Revolving
Credit Lenders whose Commitments aggregate more than fifty percent (50%) of the
Aggregate Commitments;




(c)  extend or
increase the Commitment of any Lender (or reinstate any Commitment terminated
pursuant to Section
11.2) or the amount of Loans of any Lender without the written consent of
such Lender;




(d)  postpone
any date fixed by this Agreement or any other Loan Document for any payment of
principal, interest, fees or other amounts due to the Lenders (or any of them)
hereunder or under any other Loan Document without the written consent of each
Lender directly affected thereby;




(e)  reduce
the principal of, or the rate of interest specified herein on, any Loan or
Reimbursement Obligation, or (subject to clause (iv) of the second proviso to
this Section) any fees or other amounts payable hereunder or under any other
Loan Document without the written consent of each Lender directly affected
thereby; provided that only
the consent of the Required Lenders shall be necessary (i) to waive any
obligation of the Borrower to pay interest at the rate set forth in Section 4.1(c) during
the continuance of an Event of Default, or (ii) to amend any financial covenant
hereunder (or any defined term used therein) even if the effect of such
amendment would be to reduce the rate of interest on any Loan or L/C Obligation
or to reduce any fee payable hereunder;




(f)  change
Section 4.4 or
Section 11.4 in
a manner that would alter the prorata sharing of
payments required thereby without the written consent of each Lender directly
affected thereby;




(g)  change
any provision of this Section or the definition of “Required Lenders” or any
other provision hereof specifying the number or percentage of Lenders required
to amend, waive or otherwise modify any rights hereunder or make any
determination or grant any consent hereunder, without the written consent of
each Lender;




(h)  release
all of the Guarantors or release Guarantors comprising substantially all of the
credit support for the Obligations, in either case, from the Subsidiary Guaranty
Agreement (other than as authorized in Section 12.10) or as
otherwise specifically permitted or contemplated in this Agreement or the
Subsidiary Guaranty Agreement), without the written consent of each Lender;
or




(i)  release
all or a material portion of the Collateral or release any Security Document
(other than as authorized in Section 12.10 or as
otherwise specifically permitted or contemplated in this Agreement or the
applicable Security Document) without the written consent of each
Lender;




providedfurther, that (i) no
amendment, waiver or consent shall, unless in writing and signed by the
applicable Issuing Lender in addition to the Lenders required above, affect the
rights or duties of such Issuing Lender under this Agreement or any Letter of
Credit Application relating to any Letter of Credit issued or to be issued by
it; (ii) no amendment, waiver or consent shall, unless in writing and signed by
the Swingline Lender in addition to the Lenders required above, affect the
rights or duties of the Swingline Lender under this Agreement; (iii) no
amendment, waiver or consent shall, unless in writing and signed by the
Administrative Agent in addition to the Lenders required above, affect the
rights or duties of the Administrative Agent under this Agreement or any other
Loan Document; and (iv) the Fee Letter may be amended, or rights or privileges
thereunder waived, in a writing executed only by the parties
thereto.  Notwithstanding anything to the contrary herein, no
Defaulting Lender shall have any right to approve or disapprove any amendment,
waiver or consent hereunder, except that the Commitment of such Lender may not
be increased or extended without the consent of such Lender.




In
addition, notwithstanding anything to the contrary contained herein, each Lender
hereby authorizes the Administrative Agent on its behalf, and without its
further consent, to enter into amendments to this Agreement and the other Loan
Documents as the Administrative Agent may reasonably deem appropriate in order
to effectuate any increase in the Aggregate Commitments pursuant to Section 2.7,
including, without limitation, amendments to permit such increases in the
Aggregate Commitments to share ratably in the benefits of this Agreement and the
other Loan Documents and to include appropriately any Lenders under such
increases in the Aggregate Commitments in any determination of Required Lenders;
provided that
no such amendment shall adversely affect in any material respect the rights of
any Lender, in each case, without the written consent of such
Lender.




Section
13.3  Expenses;
Indemnity.




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




(b)  Indemnification by the
Borrower.  The Borrower shall indemnify the Administrative
Agent (and any sub-agent thereof), each Lender and each Issuing Lender, and each
Related Party of any of the foregoing Persons (each such Person being called an
“Indemnitee”)
against, and hold each Indemnitee harmless from, and shall pay or reimburse any
such Indemnitee for, any and all losses, claims (including, without limitation,
any Environmental Claims or civil penalties or fines assessed by OFAC), damages,
liabilities and related expenses (including the fees, charges and disbursements
of any counsel for any Indemnitee), incurred by any Indemnitee or asserted
against any Indemnitee by any third party or by the Borrower or any other Credit
Party arising out of, in connection with, or as a result of (i) the
execution or delivery of this Agreement, any other Loan Document or any
agreement or instrument contemplated hereby or thereby, the performance by the
parties hereto of their respective obligations hereunder or thereunder or the
consummation of the transactions contemplated hereby or thereby, (ii) any
Loan or Letter of Credit or the use or proposed use of the proceeds therefrom
(including any refusal by any Issuing Lender to honor a demand for payment under
a Letter of Credit if the documents presented in connection with such demand do
not strictly comply with the terms of such Letter of Credit), (iii) any
actual or alleged presence or Release of Hazardous Materials on or from any
property owned or operated by the Borrower or any of its Subsidiaries, or any
Environmental Claim related in any way to the Borrower or any of its
Subsidiaries, (iv) any actual or prospective claim, litigation,
investigation or proceeding relating to any of the foregoing, whether based on
contract, tort or any other theory, whether brought by a third party or by the
Borrower or any other Credit Party or any Subsidiary thereof, and regardless of
whether any Indemnitee is a party thereto, or (v) any claim (including, without
limitation, any Environmental Claims or civil penalties or fines assessed by the
U.S. Department of the Treasury’s Office of Foreign Assets Control),
investigation, litigation or other proceeding (whether or not the Administrative
Agent or any Lender is a party thereto) and the prosecution and defense thereof,
arising out of or in any way connected with the Loans, this Agreement, any other
Loan Document, or any documents contemplated by or referred to herein or therein
or the transactions contemplated hereby or thereby, including without
limitation, reasonable attorneys and consultant’s fees, provided that such
indemnity shall not, as to any Indemnitee, be available to the extent that such
losses, claims, damages, liabilities or related expenses (x) are determined
by a court of competent jurisdiction by final and nonappealable judgment to have
resulted from the gross negligence or willful misconduct of such Indemnitee or
(y) result from a claim brought by the Borrower or any other Credit Party
against an Indemnitee for breach in bad faith of such Indemnitee's obligations
hereunder or under any other Loan Document, if the Borrower or such Credit Party
has obtained a final and nonappealable judgment in its favor on such claim as
determined by a court of competent jurisdiction.




(c)  Reimbursement by
Lenders.  To the extent that the Borrower for any reason fails
to indefeasibly pay any amount required under clause (a) or (b) of this
Section to be paid by it to the Administrative Agent (or any sub-agent thereof),
any Issuing Lender or any Related Party of any of the foregoing, each Lender
severally agrees to pay to the Administrative Agent (or any such sub-agent),
each Issuing Lender or such Related Party, as the case may be, such Lender’s pro
rata share (determined as of the time that the applicable unreimbursed expense
or indemnity payment is sought) of such unpaid amount, provided that the
unreimbursed expense or indemnified loss, claim, damage, liability or related
expense, as the case may be, was incurred by or asserted against the
Administrative Agent (or any such sub-agent) or such Issuing Lender in its
capacity as such, or against any Related Party of any of the foregoing acting
for the Administrative Agent (or any such sub-agent) or such Issuing Lender in
connection with such capacity.  The obligations of the Lenders under
this clause (c) are subject to the provisions of Section 4.7.




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




(e)  Payments.  All
amounts due under this Section shall be payable promptly after demand
therefor.




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




Section
13.5  Governing Law, Jurisdiction,
Etc .




(a)  Governing
Law.  This Agreement and the other Loan Documents, unless
expressly set forth therein, shall be governed by, construed and enforced in
accordance with the laws of the State of New York, including Section 5-1401 and
Section 5-1402 of the General Obligations Law of the State of New York, without
reference to any other conflicts of law principles thereof.




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




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




(d)  Service of
Process.  Each party hereto irrevocably
consents to service of process in the manner provided for notices in Section
13.1.  Nothing in this Agreement will affect the right of any
party hereto to serve process in any other manner permitted by Applicable
Law.




Section
13.6  Waiver of Jury
Trial .




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




Section
13.7  Reversal of
Payments .  To
the extent the Borrower makes a payment or payments to the Administrative Agent
for the ratable benefit of the Lenders or the Administrative Agent receives any
payment or proceeds of the collateral which payments or proceeds or any part
thereof are subsequently invalidated, declared to be fraudulent or preferential,
set aside and/or required to be repaid to a trustee, receiver or any other party
under any bankruptcy law, state or federal law, common law or equitable cause,
then, to the extent of such payment or proceeds repaid, the Obligations or part
thereof intended to be satisfied shall be revived and continued in full force
and effect as if such payment or proceeds had not been received by the
Administrative Agent.




Section
13.8  Injunctive
Relief .  The
Borrower recognizes that, in the event the Borrower fails to perform, observe or
discharge any of its obligations or liabilities under this Agreement, any remedy
of law may prove to be inadequate relief to the Lenders. Therefore, the Borrower
agrees that the Lenders, at the Lenders’ option, shall be entitled to temporary
and permanent injunctive relief in any such case without the necessity of
proving actual damages.




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




Section
13.10  Successors and Assigns;
Participations .




(a)  Successors and Assigns
Generally.  The provisions of this Agreement shall be binding
upon and inure to the benefit of the parties hereto and their respective
successors and assigns permitted hereby, except that neither the Borrower nor
any other Credit Party may assign or otherwise transfer any of its rights or
obligations hereunder without the prior written consent of the Administrative
Agent and each Lender and no Lender may assign or otherwise transfer any of its
rights or obligations hereunder except (i) to an assignee in accordance with the
provisions of paragraph (b) of this Section, (ii) by way of participation in
accordance with the provisions of paragraph (d) of this Section or (iii) by way
of pledge or assignment of a security interest subject to the restrictions of
paragraph (f) of this Section (and any other attempted assignment or transfer by
any party hereto shall be null and void).  Nothing in this Agreement,
expressed or implied, shall be construed to confer upon any Person (other than
the parties hereto, their respective successors and assigns permitted hereby,
Participants to the extent provided in paragraph (d) of this Section and, to the
extent expressly contemplated hereby, the Related Parties of each of the
Administrative Agent and the Lenders) any legal or equitable right, remedy or
claim under or by reason of this Agreement.




(b)  Assignments by
Lenders.  Any Lender may at any time assign to one or more
assignees all or a portion of its rights and obligations under this Agreement
(including all or a portion of its Commitment and the Loans at the time owing to
it); provided
that any such assignment shall be subject to the following
conditions:




(i)  Minimum
Amounts.




(A)  in the
case of an assignment of the entire remaining amount of the assigning Lender’s
Commitment and the Loans at the time owing to it or in the case of an assignment
to a Lender, an Affiliate of a Lender or an Approved Fund, no minimum amount
need be assigned; and




(B)  in any
case not described in paragraph (b)(i)(A) of this Section, the aggregate amount
of the Commitment (which for this purpose includes Loans outstanding thereunder)
or, if the applicable Commitment is not then in effect, the principal
outstanding balance of the Loans of the assigning Lender subject to each such
assignment (determined as of the date the Assignment and Assumption with respect
to such assignment is delivered to the Administrative Agent or, if “Trade Date”
is specified in the Assignment and Assumption, as of the Trade Date) shall not
be less than $5,000,000, unless each of the Administrative Agent and, so long as
no Event of Default has occurred and is continuing, the Borrower otherwise
consents (each such consent not to be unreasonably withheld or delayed); provided that the
Borrower shall be deemed to have given its consent five (5) Business Days after
the date written notice thereof has been delivered by the assigning Lender
(through the Administrative Agent) unless such consent is expressly refused by
the Borrower prior to such fifth (5th) Business Day;




(ii)  Required
Consents.  No consent shall be required for any assignment
except to the extent required by paragraph (b)(i)(B)
of this Section and, in addition:




(A)  the
consent of the Borrower (such consent not to be unreasonably withheld or
delayed) shall be required unless (x) an Event of Default has occurred and is
continuing at the time of such assignment or (y) such assignment is to a Lender,
an Affiliate of a Lender or an Approved Fund;




(B)  the
consent of the Administrative Agent (such consent not to be unreasonably
withheld or delayed) shall be required for any assignment if such assignment is
to a Person that is not a Lender with a Commitment, an Affiliate of such Lender
or an Approved Fund with respect to such Lender; and




(C)  the
consents of the applicable Issuing Lender and the Swingline Lender (such
consents not to be unreasonably withheld or delayed) shall be required for any
assignment that increases the obligation of the assignee to participate in
exposure under one or more Letters of Credit (whether or not then outstanding)
or for any assignment in respect of the Revolving Credit Facility.




(iii)  Assignment and
Assumption.  The parties to each assignment shall execute and
deliver to the Administrative Agent an Assignment and Assumption, together with
a processing and recordation fee of $3,500 for each assignment,and the assignee, if it is
not a Lender, shall deliver to the Administrative Agent an Administrative
Questionnaire.




(iv)  No Assignment to
Borrower.  No such assignment shall be made to the Borrower or
any of the Borrower’s Affiliates or Subsidiaries.




(v)  No Assignment to Natural
Persons.  No such assignment shall be made to a natural
person.




Subject
to acceptance and recording thereof by the Administrative Agent pursuant to
paragraph (c) of this Section, from and after the effective date specified in
each Assignment and Assumption, the assignee thereunder shall be a party to this
Agreement and, to the extent of the interest assigned by such Assignment and
Assumption, have the rights and obligations of a Lender under this Agreement,
and the assigning Lender thereunder shall, to the extent of the interest
assigned by such Assignment and Assumption, be released from its obligations
under this Agreement (and, in the case of an Assignment and Assumption covering
all of the assigning Lender’s rights and obligations under this Agreement, such
Lender shall cease to be a party hereto) but shall continue to be entitled to
the benefits of Sections 4.8, 4.9, 4.10, 4.11 and 13.3 with respect to
facts and circumstances occurring prior to the effective date of such
assignment.  Any assignment or transfer by a Lender of rights or
obligations under this Agreement that does not comply with this paragraph shall
be treated for purposes of this Agreement as a sale by such Lender of a
participation in such rights and obligations in accordance with paragraph (d) of
this Section.




(c)  Register.  The
Administrative Agent, acting solely for this purpose as an agent of the
Borrower, shall maintain at one of its offices in Charlotte, North Carolina, a
copy of each Assignment and Assumption delivered to it and a register for the
recordation of the names and addresses of the Lenders, and the Commitment of,
and principal amounts of the Loans owing to, each Lender pursuant to the terms
hereof from time to time (the “Register”).  The
entries in the Register shall be conclusive, and the Borrower, the
Administrative Agent and the Lenders may treat each Person whose name is
recorded in the Register pursuant to the terms hereof as a Lender hereunder for
all purposes of this Agreement, notwithstanding notice to the
contrary.  The Register shall be available for inspection by the
Borrower and any Lender (but only to the extent of entries in the Register that
are applicable to such Lender), at any reasonable time and from time to time
upon reasonable prior notice.




(d)  Participations.  Any
Lender may at
any time, without the consent of, or notice to, the Borrower or the
Administrative Agent, sell participations to any Person (other than a natural
person or the Borrower or any of the Borrower’s Affiliates or Subsidiaries)
(each, a “Participant”) in all
or a portion of such Lender’s rights and/or obligations under this Agreement
(including all or a portion of its Commitment and/or the Loans owing to it);
provided that
(i) such Lender’s obligations under this Agreement shall remain unchanged, (ii)
such Lender shall remain solely responsible to the other parties hereto for the
performance of such obligations and (iii) the Borrower, the Administrative
Agent, the Issuing Lenders, the Swingline Lender and the other Lenders shall
continue to deal solely and directly with such Lender in connection with such
Lender’s rights and obligations under this Agreement.




Any
agreement or instrument pursuant to which a Lender sells such a participation
shall provide that such Lender shall retain the sole right to enforce this
Agreement and to approve any amendment, modification or waiver of any provision
of this Agreement; provided that such
agreement or instrument may provide that such Lender will not, without the
consent of the Participant, agree to any amendment, modification or waiver or
modification described in Section 13.2 that
directly affects such Participant and could not be affected by a vote of the
Required Lenders.  Subject to paragraph (e) of this Section, the
Borrower agrees that each Participant shall be entitled to the benefits of Sections 4.8, 4.9, 4.10 and 4.11 to the same
extent as if it was a Lender and had acquired its interest by assignment
pursuant to paragraph (b) of this Section.  To the extent permitted by
law, each Participant also shall be entitled to the benefits of Section 13.4 as
though it were a Lender, provided such Participant agrees to be subject to Section 4.6 as though
it were a Lender.




(e)  Limitations upon Participant
Rights.  A Participant shall not be entitled to receive any
greater payment under Sections 4.10 and
4.11than the applicable
Lender would have been entitled to receive with respect to the participation
sold to such Participant, unless the sale of the participation to such
Participant is made with the Borrower’s prior written consent.  A
Participant that would be a Foreign Lender if it were a Lender shall not be
entitled to the benefits of Section 4.11 unless
the Borrower is notified of the participation sold to such Participant and such
Participant agrees, for the benefit of the Borrower, to comply with Section 4.11(e) as
though it were a Lender.




(f)  Certain
Pledges.  Any Lender may at any time pledge or assign a
security interest in all or any portion of its rights under this Agreement to
secure obligations of such Lender, including without limitation any pledge or
assignment to secure obligations to a Federal Reserve Bank; provided that no such
pledge or assignment shall release such Lender from any of its obligations
hereunder or substitute any such pledgee or assignee for such Lender as a party
hereto.




Section
13.11  Confidentiality .  Each
of the Administrative Agent, the Lenders and the Issuing Lenders agrees to
maintain the confidentiality of the Information (as defined below), except that
Information may be disclosed (a) to its Affiliates and to its and its
Affiliates’ respective partners, directors, officers, employees, agents,
advisors and other representatives (it being understood that the Persons to whom
such disclosure is made will be informed of the confidential nature of such
Information and instructed to keep such Information confidential), (b) to the
extent requested by any regulatory authority purporting to have jurisdiction
over it (including any self-regulatory authority, such as the National
Association of Insurance Commissioners), (c) to the extent required by
Applicable Laws or regulations or by any subpoena or similar legal process, (d)
to any other party hereto, (e) in connection with the exercise of any remedies
hereunder or under any other Loan Document or any action or proceeding relating
to this Agreement or any other Loan Document (or any Hedging Agreement with a
Lender or the Administrative Agent) or the enforcement of rights hereunder or
thereunder, (f) subject to an agreement containing provisions substantially the
same as those of this Section, to (i) any assignee of or Participant in, or any
prospective assignee of or Participant in, any of its rights or obligations
under this Agreement, Participant or proposed Participant, or (ii) any actual or
prospective counterparty (or its advisors) to any swap or derivative transaction
relating to the Borrower and its obligations, (g) with the consent of the
Borrower, (h) to Gold
Sheets and other similar bank trade publications, such information to
consist of deal terms and other information customarily found in such
publications, or (i) to the extent such Information (x) becomes publicly
available other than as a result of a breach of this Section or (y) becomes
available to the Administrative Agent, any Lender, any Issuing Lender or any of
their respective Affiliates on a nonconfidential basis from a source other than
the Borrower.  For purposes of this Section, “Information” means
all information received from the Borrower or any of its Subsidiaries relating
to the Borrower or any of its Subsidiaries or any of their respective
businesses, other than any such information that is available to the
Administrative Agent, any Lender or any Issuing Lender on a nonconfidential
basis prior to disclosure by the Borrower or any of its Subsidiaries; provided that, in the
case of information received from the Borrower or any of its Subsidiaries after
the date hereof, such information is clearly identified at the time of delivery
as confidential.  Any Person required to maintain the confidentiality
of Information as provided in this Section shall be considered to have complied
with its obligation to do so if such Person has exercised the same degree of
care to maintain the confidentiality of such Information as such Person would
accord to its own confidential information.




Section
13.12  Performance of
Duties .  Each
of the Credit Party’s obligations under this Agreement and each of the other
Loan Documents shall be performed by such Credit Party at its sole cost and
expense.




Section
13.13  All Powers Coupled with
Interest .  All
powers of attorney and other authorizations granted to the Lenders, the
Administrative Agent and any Persons designated by the Administrative Agent or
any Lender pursuant to any provisions of this Agreement or any of the other Loan
Documents shall be deemed coupled with an interest and shall be irrevocable so
long as any of the Obligations remain unpaid or unsatisfied, any of the
Aggregate Commitment remains in effect or the Credit Facility has not been
terminated.




Section
13.14  Survival of
Indemnities .  Notwithstanding
any termination of this Agreement, the indemnities to which the Administrative
Agent and the Lenders are entitled under the provisions of this Article XIII and any
other provision of this Agreement and the other Loan Documents shall continue in
full force and effect and shall protect the Administrative Agent and the Lenders
against events arising after such termination as well as before.




Section
13.15  Titles and
Captions .  Titles
and captions of Articles, Sections and subsections in, and the table of contents
of, this Agreement are for convenience only, and neither limit nor amplify the
provisions of this Agreement.




Section
13.16  Severability of
Provisions .  Any
provision of this Agreement or any other Loan Document which is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
only to the extent of such prohibition or unenforceability without invalidating
the remainder of such provision or the remaining provisions hereof or thereof or
affecting the validity or enforceability of such provision in any other
jurisdiction.




Section
13.17  Counterparts; Integration;
Effectiveness; Electronic Execution .




(a)  Counterparts; Integration;
Effectiveness.  This Agreement may be executed in counterparts
(and by different parties hereto in different counterparts), each of which shall
constitute an original, but all of which when taken together shall constitute a
single contract.  This Agreement and the other Loan Documents, and any
separate letter agreements with respect to fees payable to the Administrative
Agent, constitute the entire contract among the parties relating to the subject
matter hereof and supersede any and all previous agreements and understandings,
oral or written, relating to the subject matter hereof.  In the event
of any conflict between the provisions of this Agreement and those of any other
Loan Document, the provisions of this Agreement shall control; provided that the
inclusion of supplemental rights or remedies in favor of the Administrative
Agent or the Lenders in any other Loan Document shall not be deemed a conflict
with this Agreement.  Each Loan Document was drafted with the joint
participation of the respective parties thereto and shall be construed neither
against nor in favor of any party, but rather in accordance with the fair
meaning thereof.  Except as provided in Section 5.2, this
Agreement shall become effective when it shall have been executed by the
Administrative Agent and when the Administrative Agent shall have received
counterparts hereof that, when taken together, bear the signatures of each of
the other parties hereto.  Delivery of an executed counterpart of a
signature page of this agreement by telecopy shall be effective as delivery of a
manually executed counterpart of this Agreement.




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




Section
13.18  Term of
Agreement .  This
Agreement shall remain in effect from the Closing Date through and including the
date upon which all Obligations arising hereunder or under any other Loan
Document shall have been indefeasibly and irrevocably paid and satisfied in full
and the Aggregate Commitment has been terminated.  No termination of
this Agreement shall affect the rights and obligations of the parties hereto
arising prior to such termination or in respect of any provision of this
Agreement which survives such termination.




Section
13.19  USA Patriot
Act .  The
Administrative Agent and each Lender hereby notifies the Borrower that pursuant
to the Act, it is required to obtain, verify and record information that
identifies the Borrower and Guarantors, which information includes the name and
address of each Borrower and Guarantor and other information that will allow
such Lender to identify such Borrower or Guarantor in accordance with the
Act




Section
13.20  Advice of Counsel; No Strict
Construction .  Each
of the parties represents to each other party hereto that it has discussed this
Agreement with its counsel.  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 favoring or disfavoring any party by
virtue of the authorship of any provisions of this Agreement.




Section
13.21  Inconsistencies with Other
Documents; Independent Effect of Covenants .




(a)  In the
event there is a conflict or inconsistency between this Agreement and any other
Loan Document, the terms of this Agreement shall control; provided that any
provision of the Security Documents which imposes additional burdens on the
Borrower or any of its Subsidiaries or further restricts the rights of the
Borrower or any of its Subsidiaries or gives the Administrative Agent or Lenders
additional rights shall not be deemed to be in conflict or inconsistent with
this Agreement and shall be given full force and effect.




(b)  The
Borrower expressly acknowledges and agrees that each covenant contained in Articles VIII, IX, or X hereof shall be
given independent effect.  Accordingly, the Borrower shall not engage
in any transaction or other act otherwise permitted under any covenant contained
in Articles
VIII, IX, or X if, before or after
giving effect to such transaction or act, the Borrower shall or would be in
breach of any other covenant contained in Articles VIII, IX, or X.




[Signature
pages to follow]







IN
WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
under seal by their duly authorized officers, all as of the day and year first
written above.







LMI AEROSPACE, INC., as
      BorrowerBy:
            /s/
      Lawrence E. DickinsonName:
            Lawrence
      E. DickinsonTitle:
            Chief
      Financial Officer & Secretary
















AGENTS AND
      LENDERS:WACHOVIA BANK, NATIONAL
      ASSOCIATION,
              as
      Administrative Agent, Swingline Lender, Issuing Lender
              and
      LenderBy:
            /s/
      James R. ZilischName:
            James
      R. ZilischTitle:
            Managing
      Director

















WELLS
      FARGO BANK, N.A.,
              as
      LenderBy:
            /s/
      Beth A. TiffinName:
            Beth
      A. TiffinTitle:
            Vice
      President

















LaSalle Bank National
      Association,as
      LenderBy:
            /s/
      Jon ChaseName:
            Jon
      ChaseTitle:
            Assistant
      Vice President

















Charter
      One Bank, N.A.,as
      LenderBy:
            /s/
      Richard H. AultName:
            Richard
      H AultTitle:
            Vice
      President

















Comerica
      Bank,as
      LenderBy:
            /s/
      Mark J. LeveilleName:
            Mark
      J. LeveilleTitle:
            Assistant
      Vice President

















U.S.
      BANK, NATIONAL ASSOCIATION,as
      LenderBy:
            /s/
      Derek L. MartinName:
            Derek
      L. MartinTitle:
            Vice
      President










EXHIBIT
A-1


to


Credit
Agreement


dated as
of July 31, 2007


by and
among


LMI
Aerospace, Inc.,


as
Borrower,


the
Lenders party thereto,


as
Lenders


and


Wachovia
Bank, National Association,


as
Administrative Agent








FORM OF REVOLVING CREDIT
NOTE














REVOLVING CREDIT
NOTE





$____________________                                                                                                                                 _____________,
20__





FOR VALUE
RECEIVED, the undersigned, LMI AEROSPACE, INC., a Missouri corporation (the
"Borrower"), promises to pay to the order of ____________________ (the
"Lender"), at the place and times provided in the Credit Agreement referred to
below, the principal sum of ________________________ AND NO/100 DOLLARS
($________________) or, if less, the unpaid principal amount of all Revolving
Credit Loans made by the Lender from time to time pursuant to that certain
Credit Agreement, dated as of July 31, 2007 (as amended, restated, supplemented
or otherwise modified from time to time, the "Credit Agreement") by
and among the Borrower, the Lenders who are or may become a party thereto, as
Lenders, and Wachovia Bank, National Association, as Administrative Agent.
Capitalized terms used herein and not defined herein shall have the meanings
assigned thereto in the Credit Agreement.





The
unpaid principal amount of this Revolving Credit Note from time to time
outstanding is subject to mandatory repayment from time to time as provided in
the Credit Agreement and shall bear interest as provided in Section 4.1, of the
Credit Agreement. The Borrower shall have the right, at any time and from time
to time, to make voluntary prepayments of the outstanding principal amount of,
and interest on, this Revolving Credit Note, in whole or in part, without
premium or penalty (except as otherwise provided in the Credit Agreement)
pursuant to Section
2.4(c) of the Credit Agreement. All payments of principal and interest on
this Revolving Credit Note shall be payable in lawful currency of the United
States of America in immediately available funds to the account designated in
the Credit Agreement.





This
Revolving Credit Note is entitled to the benefits of, and evidences Obligations
incurred under, the Credit Agreement, to which reference is made for a
description of the security for this Revolving Credit Note and for a statement
of the terms and conditions on which the Borrower is permitted and required to
make prepayments and repayments of principal of the Obligations evidenced by
this Revolving Credit Note and on which such Obligations may be declared to be
immediately due and payable.





THIS
REVOLVING CREDIT NOTE SHALL BE GOVERNED BY, CONSTRUED AND ENFORCED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF NEW YORK, INCLUDING SECTION 5-1401 AND SECTION
5-1402 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK, WITHOUT
REFERENCE TO ANY OTHER CONFLICT OF LAW PRINCIPLES THEREOF.





The
Indebtedness evidenced by this Revolving Credit Note is senior in right of
payment to all Subordinated Indebtedness referred to in the Credit
Agreement.




The
Borrower hereby waives all requirements as to diligence, presentment, demand of
payment, protest and (except as required by the Credit Agreement) notice of any
kind including, without limitation, notice of acceleration or intent to
accelerate, with respect to this Revolving Credit Note.





[Signature
Page Follows]











IN WITNESS WHEREOF, the undersigned has
executed this Revolving Credit Note as of the day and year first above
written.








LMI
      AEROSPACE, INC.By:  __________________________________Name: ________________________________Title:   ________________________________

















EXHIBIT
A-2


to


Credit
Agreement


dated as
of July 31, 2007


by and
among


LMI
Aerospace, Inc.,


as
Borrower,


the
Lenders party thereto,


as
Lenders


and


Wachovia
Bank, National Association,


as
Administrative Agent








FORM OF SWINGLINE
NOTE











SWINGLINE
NOTE





$10,000,000                                                                                                                                                     July 31, 2007





FOR VALUE
RECEIVED, the undersigned, LMI AEROSPACE, INC., a Missouri corporation (the
"Borrower"),
promises to pay to the order of WACHOVIA BANK, NATIONAL ASSOCIATION (the "Lender"), at the
place and times provided in the Credit Agreement referred to below, the
principal sum of TEN MILLION AND NO/ 100 DOLLARS ($10,000,000) or, if less, the
principal amount of all Swingline Loans made by the Lender from time to time
pursuant to that certain Credit Agreement, dated as of July 31, 2007 (as
amended, restated, supplemented or otherwise modified, the "Credit Agreement") by
and among the Borrower, the Lenders who are or may become a party thereto, as
Lenders, and Wachovia Bank, National Association, as Administrative Agent.
Capitalized terms used herein and not defined herein shall have the meanings
assigned thereto in the Credit Agreement





The
unpaid principal amount of this Swingline Note from time to time outstanding is
subject to mandatory repayment from time to time as provided in the Credit
Agreement and shall bear interest as provided in Section 4.1, of the
Credit Agreement The Borrower shall have the right, at any time and from time to
time, to make voluntary prepayments of the outstanding principal amount of, and
interest on, this Swingline Note, in whole or in part, without premium or
penalty (except as otherwise provided in the Credit Agreement) pursuant to Section 2.4(c) of the
Credit Agreement. Swingline Loans refunded as Revolving Credit Loans in
accordance with Section 2.2(b) of the
Credit Agreement shall be payable by the Borrower as Revolving Credit Loans
pursuant to the Revolving Credit Notes, and shall not be payable under this
Swingline Note as Swingline Loans. All payments of principal and interest on
this Swingline Note shall be payable in lawful currency of the United States of
America in immediately available funds, to the account designated in the Credit
Agreement.





This
Swingline Note is entitled to the benefits of, and evidences Swingline Loans and
associated Obligations incurred under, the Credit Agreement, to which reference
is made for a description of the security for this Swingline Note and for a
statement of the terms and conditions on which the Borrower is permitted and
required to make prepayments and repayments of principal of the Swingline Loans
and associated Obligations evidenced by this Swingline Note and on which such
Swingline Loans and associated Obligations may be declared to be immediately due
and payable.





THIS
SWINGLINE NOTE SHALL BE GOVERNED BY, CONSTRUED AND ENFORCED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF NEW YORK, INCLUDING SECTION 5-1401 AND SECTION 5-1402
OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO
ANY OTHER CONFLICT OF LAW PRINCIPLES THEREOF.




The
Indebtedness evidenced by this Swingline Note is senior in right of payment to
all Subordinated Indebtedness referred to in the Credit Agreement.





The
Borrower hereby waives all requirements as to diligence, presentment, demand of
payment, protest and (except as required by the Credit Agreement) notice of any
kind including, without limitation, notice of acceleration or intent to
accelerate, with respect to this Swingline Note.





[Signature
Page Follows]











IN WITNESS WHEREOF, the undersigned has
executed this Swingline Note as of the day and year first above
written.











LMI
      AEROSPACE, INC.By:  _______________________________Name: ____________________________Title:  _____________________________














EXHIBIT
B


to


Credit
Agreement


dated as
of July 31, 2007


by and
among


LMI
Aerospace, Inc.,


as
Borrower,


the
Lenders party thereto,


as
Lenders


and


Wachovia
Bank, National Association,


as
Administrative Agent








FORM OF NOTICE OF
BORROWING











NOTICE OF
BORROWING





Dated as
of: _________________





Wachovia
      Bank, National Association,as
      Administrative AgentCharlotte
      Plaza, CP-8201
      South College StreetCharlotte,
      North Carolina 28288-0680Attention:
      Syndication Agency Services





Ladies
and Gentlemen:





This irrevocable Notice of Borrowing is
delivered to you pursuant to Section 2.3, of the
Credit Agreement dated as of July 31, 2007 (as amended, restated, supplemented
or otherwise modified, the "Credit Agreement"),
by and among LMI AEROSPACE, INC., a Missouri corporation, as Borrower, the
lenders who are or may become party thereto, as Lenders, and Wachovia Bank,
National Association, as Administrative Agent. Capitalized terms used herein and
not defined herein shall have the meanings assigned thereto in the Credit
Agreement




1.           The
Borrower hereby requests that the Lenders make a [Revolving Credit Loan]
[Swingline Loan] to the Borrower in the aggregate principal amount of
_______________.  (Complete with an amount in accordance with Section
2.3(a) of the Credit Agreement.)




2.           The
Borrower hereby requests that such Loan be made on the following Business Day:
__________________.  (Complete with a Business Day in
accordance with Section 2.3(a) of the Credit Agreement for Revolving Credit
Loans or Swingline Loans).





3.           The
Borrower hereby requests that such Loan bear interest at the following interest
rate, plus the Applicable
Margin, as set forth below:





Interest
Period                                         Termination Date
for


Component                                                                                   (LIBOR                                  Interest
Period


of
Loan                                Interest
Rate                                   Rate
only)                                                   
(if
applicable)





[Base Rate or LIBOR


Rate]1











1 Complete
with (i) the Base Rate or the LIBOR Rate for Revolving Credit Loans (provided that the LIBOR Rate shall not
be available until three (3) Business Days after the Closing Date) or (ii) the
Base Rate for Swingline Loans.











4.           The
principal amount of all Loans and L/C Obligations outstanding as of the date
hereof (including the Loan requested herein) does not exceed the maximum amount
permitted to be outstanding pursuant to the terms of the Credit
Agreement.





5.           All
of the conditions applicable to the Loan requested herein as set forth in the
Credit Agreement have been satisfied as of the date hereof and will remain
satisfied to the date of such Loan.





[Signature
Page Follows]





2





IN WITNESS WHEREOF, the undersigned has
executed this Notice of Borrowing as of the day and year first written
above.





LMI
      AEROSPACE, INC.By: ________________________________Name: _____________________________Title:  ______________________________








3





EXHIBIT
C


to


Credit
Agreement


dated as
of July 31, 2007


by and
among


LMI
Aerospace, Inc.,


as
Borrower,


the
Lenders party thereto,


as
Lenders


and


Wachovia
Bank, National Association,


as
Administrative Agent








FORM OF NOTICE OF ACCOUNT
DESIGNATION










NOTICE OF ACCOUNT
DESIGNATION




Dated as
of: ______________








Wachovia
      Bank, National Association,as
      Administrative AgentCharlotte
      Plaza, CP-8201
      South College StreetCharlotte,
      North Carolina 28288-0680Attention:
      Syndication Agency Services





Ladies
and Gentlemen:




This
Notice of Account Designation is delivered to you pursuant to Section 2.3(b) of the
Credit Agreement dated as of July 31, 2007 (as amended, restated, supplemented
or otherwise modified, the "Credit Agreement"),
by and among LMI AEROSPACE, INC., a Missouri corporation, as Borrower, the
lenders who are or may become party thereto, as Lenders, and Wachovia Bank,
National Association, as Administrative Agent. Capitalized terms used herein and
not defined herein shall have the meanings assigned thereto in the Credit
Agreement





1.           The
Administrative Agent is hereby authorized to disburse all Loan proceeds into the
following account(s):





ABA
Routing
Number: ______________


Account
Number: _______________





2.           This
authorization shall remain in effect until revoked or until a subsequent Notice
of Account Designation is provided to the Administrative Agent.





[Signature
Page Follows]











IN WITNESS WHEREOF, the undersigned has
executed this Notice of Account Designation as of the day and year first written
above.








LMI
      AEROSPACE, INC.By:  ______________________________Name:  ___________________________Title: ____________________________

















EXHIBIT
D


to


Credit
Agreement


dated as
of July 31, 2007


by and
among


LMI
Aerospace, Inc.,


as
Borrower,


the
Lenders party thereto,


as
Lenders


and


Wachovia
Bank, National Association,


as
Administrative Agent








FORM OF NOTICE OF
PREPAYMENT











NOTICE OF
PREPAYMENT





Dated as
of: ________________








Wachovia
      Bank, National Association,as
      Administrative AgentCharlotte
      Plaza, CP-8201
      South College StreetCharlotte,
      North Carolina 28288-0680Attention:
      Syndication Agency Services





Ladies
and Gentlemen:




This
irrevocable Notice of Prepayment is delivered to you pursuant to Section 2.4(c) of the
Credit Agreement dated as of July 31, 2007 (as amended, restated, supplemented
or otherwise modified, the "Credit Agreement"),
by and among LMI AEROSPACE, INC., a Missouri corporation, as Borrower, the
lenders who are or may become party thereto, as Lenders, and Wachovia Bank,
National Association, as Administrative Agent. Capitalized terms used herein and
not defined herein shall have the meanings assigned thereto in the Credit
Agreement.







1.           The
Borrower hereby provides notice to the Administrative Agent that it shall repay
the following Base Rate Loans and/or LIBOR Rate Loans: _____________. (Complete with an amount in accordance
withSection
2.4of the Credit
Agreement).





2.           The
Loan to be prepaid is a [check each applicable box]





q           Swingline
Loan





q           Revolving
Credit Loan




3.           The Borrower shall repay the
above-referenced Loans on the following Business Day: _____________.(Complete with a date no
earlier than the same Business Day as of the date of this Notice of Prepayment
with respect to any Base Rate Loan (including any Swingline Loan) and three (3)
Business Days subsequent to date of this Notice of Prepayment with respect to
any LIBOR Rate Loan.)





[Signature
Page Follows]











IN WITNESS WHEREOF, the undersigned has
executed this Notice of Prepayment as of the day and year first written
above.





LMI
      AEROSPACE, INC.By:  ______________________________Name:  ___________________________Title:  ____________________________














EXHIBIT
E


to


Credit
Agreement


dated as
of July 31, 2007


by and
among


LMI
Aerospace, Inc.,


as
Borrower,


the
Lenders party thereto,


as
Lenders


and


Wachovia
Bank, National Association,


as
Administrative Agent








FORM OF NOTICE OF
CONVERSION/CONTINUATION











NOTICE OF
CONVERSION/CONTINUATION





Dated as
of: ___________________








Wachovia
      Bank, National Association,as
      Administrative AgentCharlotte
      Plaza, CP-8201
      South College StreetCharlotte,
      North Carolina 28288-0680Attention:
      Syndication Agency Services





Ladies
and Gentlemen:




This
irrevocable Notice of Conversion/Continuation (this “Notice”) is delivered
to you pursuant to Section 4.2 of the
Credit Agreement dated as of July 31, 2007 (as amended, restated, supplemented
or otherwise modified, the "Credit Agreement"),
by and among LMI AEROSPACE, INC., a Missouri corporation, as Borrower, the
lenders who are or may become party thereto, as Lenders, and Wachovia Bank,
National Association, as Administrative Agent. Capitalized terms used herein and
not defined herein shall have the meanings assigned thereto in the Credit
Agreement





1.           This
Notice is submitted for the purpose of: (Check one and complete applicable
information in accordance with the Credit Agreement.)





 ̈           Converting all or a portion
of a Base Rate Loan into a LIBOR Rate Loan





(a)
            The
      aggregate outstanding principal balance of such Loan is
      $_________________.





(b)
            The
      principal amount of such Loan to be converted is
      $_____________________.





(c)
            The
      requested effective date of the conversion of such Loan is
      __________________.





(d)
            The
      requested Interest Period applicable to the converted Loan is
      __________________.





 ̈           Converting a portion of
LIBOR Rate Loan into a Base Rate Loan





(a)
            The
      aggregate outstanding principal balance of such Loan is
      $__________________.




(b)
            The
      last day of the current Interest Period for such Loan is
      ___________________.





(c)
            The
      principal amount of such Loan to be converted is
      $__________________.





(d)
            The
      requested effective date of the conversion of such Loan is
      ___________________.





 ̈
            Continuing
      all or a portion of a LIBOR Rate Loan as a LIBOR Rate
  Loan





(a)
            The
      aggregate outstanding principal balance of such Loan is
      $__________________.





(b)
            The
      last day of the current Interest Period for such Loan is
      ___________________.





(c)
            The
      principal amount of such Loan to be continued is
      $__________________.





(d)
            The
      requested effective date of the continuation of such Loan is
      ___________________.





(e)
            The
      requested Interest Period applicable to the continued Loan is
      ___________________.





2.           
The principal amount of all Loans and L/C Obligations outstanding as of the date
hereof does not exceed the maximum amount permitted to be outstanding pursuant
to the terms of the Credit Agreement.




3.           
All of the conditions applicable to the conversion or continuation of the Loan
requested herein as set forth in the Credit Agreement have been satisfied or
waived as of the date hereof and will remain satisfied or waived to the date of
such Loan.





[Signature
Page Follows]











IN WITNESS WHEREOF, the undersigned has
executed this Notice of Conversion/Continuation as of the day and year first
written above.








LMI
      AEROSPACE, INC.By:  _________________________________Name:  ______________________________Title:  _______________________________

















EXHIBIT
F


to


Credit
Agreement


dated as
of July 31, 2007


by and
among


LMI
Aerospace, Inc.,


as
Borrower,


the
Lenders party thereto,


as
Lenders


and


Wachovia
Bank, National Association,


as
Administrative Agent








FORM OF OFFICER'S COMPLIANCE
CERTIFICATE














OFFICER'S COMPLIANCE
CERTIFICATE







The
undersigned, on behalf of LMI AEROSPACE, INC., a Missouri corporation, as
Borrower, hereby certifies to the Administrative Agent and the Lenders, each as
defined in the Credit Agreement referred to below, as follows:





1.           
This certificate is delivered to you pursuant to Section 7.2 of the
Credit Agreement dated as of July 31, 2007 (as amended, restated, supplemented
or otherwise modified, the "Credit Agreement"),
by and among the Borrower, the Lenders who are or may become party thereto, as
Lenders, and Wachovia Bank, National Association, as Administrative Agent.
Capitalized terms used herein and not defined herein shall have the meanings
assigned thereto in the Credit Agreement.





2.           I
have reviewed the financial statements of the Borrower and its Subsidiaries
dated as of ______________ and for the ___________ period[s] then ended
delivered in accordance with Section 7.1[(a)][(b)]
of the Credit Agreement and such statements fairly present in all material
respects the financial condition of the Borrower and its Subsidiaries as of the
dates indicated and the results of their operations and cash flows for the
period[s] indicated.




3.           
I have reviewed the terms of the Credit Agreement, and the related Loan
Documents and have made, or caused to be made under my supervision, a review in
reasonable detail of the transactions and the condition of the Borrower and its
Subsidiaries during the accounting period covered by the financial statements
referred to in Paragraph 2 above. Such review has not disclosed the existence
during or at the end of such accounting period of any condition or event that
constitutes a Default or an Event of Default, nor do I have any knowledge of the
existence of any such condition or event as at the date of this certificate
[except, if such condition or event existed or exists, describe the nature and
period of existence thereof and what action the Borrower has taken, is taking
and proposes to take with respect thereto].





4.           The
Applicable Margin, the Commitment Fee and calculations determining such figures
are set forth on the attached Schedule
1.





5.           
The Borrower and its Subsidiaries are in compliance with the financial covenants
contained in Article
IX of the Credit Agreement as shown on such Schedule 2 and the
Borrower and its Subsidiaries are in compliance with the other covenants and
restrictions contained in the Credit Agreement.





[Signature
Page Follows]











WITNESS the following signature as of
the day and year first written above.








LMI
      AEROSPACE, INC.By:  _______________________________Name: ____________________________Title: _____________________________

















Schedule
1


to


Officer's Compliance
Certificate








[To be
provided in a form acceptable to the Administrative Agent]














Schedule
2


to


Officer's Compliance
Certificate








[To be
provided in a form acceptable to the Administrative Agent]














EXHIBIT
G


to


Credit
Agreement


dated as
of July 31, 2007


by and
among


LMI
Aerospace, Inc.,


as
Borrower,


the
Lenders party thereto,


as
Lenders


and


Wachovia
Bank, National Association,


as
Administrative Agent








FORM OF ASSIGNMENT AND
ASSUMPTION














ASSIGNMENT AND
ASSUMPTION







This
Assignment and Assumption (the "Assignment and
Assumption") is dated as of the Effective Date set forth below and is
entered into by and between [the][each]1 Assignor identified on the Schedules hereto as
"Assignor" or "Assignors" (collectively, the "Assignors" and each
an "Assignor")
and [the] [each]2 Assignee identified on the Schedules hereto as
"Assignee" or "Assignees" (collectively, the "Assignees" and each
an "Assignee").
[It is understood and agreed that the rights and obligations of [the Assignors]
[the Assignees]3 hereunder are several and not joint.]4 Capitalized terms used but not defined herein
shall have the meanings given to them in the Credit Agreement identified below
(as amended, the "Credit Agreement"),
receipt of a copy of which is hereby acknowledged by [the] [each] Assignee. The
Standard Terms and Conditions set forth in Annex 1, attached
hereto are hereby agreed to and incorporated herein by reference and made a part
of this Assignment and Assumption as if set forth herein in full.





For an agreed consideration,
[the][each] Assignor hereby irrevocably sells and assigns to [the Assignee] [the
respective Assignees], and [the][each] Assignee hereby irrevocably purchases and
assumes from [the Assignor][the respective Assignors], subject to and in
accordance with the Standard Terms and Conditions and the Credit Agreement, as
of the Effective Date inserted by the Administrative Agent as contemplated below
(i) all of [the Assignor's][the respective Assignors'] rights and obligations in
[its capacity as a Lender][their respective capacities as Lenders] under the
Credit Agreement and any other documents or instruments delivered pursuant
thereto to the extent 'related to the amount and percentage interest identified
below of all of such outstanding rights and obligations of [the Assignor] [the
respective Assignors] under the respective facilities identified below
(including without limitation any letters of credit, guarantees, and swingline
loans included in such facilities) and (ii) to the extent permitted to be
assigned under applicable law, all claims, suits, causes of action and any other
right of [the Assignor (in its capacity as a Lender)][the respective Assignors
(in their respective capacities as Lenders)] against any Person, whether known
or unknown, arising under or in connection with the Credit Agreement, any other
documents or instruments delivered pursuant thereto or the loan transactions
governed thereby or in any way based on or related to any of the foregoing,
including, but not limited to, contract claims, tort claims, malpractice claims,
statutory claims and all other claims at law or in equity related to the rights
and obligations sold and assigned pursuant to clause (i) above (the rights and
obligations sold and assigned by [the][any] Assignor to [the][any] Assignee
pursuant to clauses (i) and (ii) above being referred to herein collectively as
[the][an] "Assigned
Interest"). Each such sale and assignment is without recourse to
[the][any] Assignor and, except as expressly provided in this Assignment and
Assumption, without representation or warranty by [the][any]
Assignor.




1 For
bracketed language here and elsewhere in this form relating to the Assignor(s),
if the assignment is from a single Assignor, choose the first bracketed
language. If the assignment is from multiple Assignors, choose the second
bracketed language.
 2 For bracketed language here and
elsewhere in this form relating to the Assignee(s), if the assignment is to a
single Assignee, choose the first bracketed language. If the assignment is to
multiple Assignees, choose the second bracketed
language.
 3 Select
as appropriate.
 4 Include
bracketed language if there are either multiple Assignors or multiple
Assignees.









1.
            Assignor:
            See
      Schedules attached hereto2.
            Assignees:
            See
      Schedules attached hereto3.
            Borrower:
            LMI
      Aerospace, Inc.4.
            Administrative
      Agent:
            Wachovia
      Bank, National Association, as the administrative under the Credit
      Agreement5.
            Credit
      Agreement:
            The
      Credit Agreement dated as of July 31, 2007 among LMI Aerospace, Inc., as
      Borrower, the Lenders who are or may become party thereto, as Lenders, and
      Wachovia Bank, Association, as Administrative Agent (as amended, restated,
      supplemented or otherwise modified)6.
            Assigned
      Interest:
            See
      Schedules attached hereto[7.
            Trade
      Date:
            __________________]5








[Remainder
of Page Intentionally Left Blank]








5 To
be completed if the Assignor and the Assignees intend that the minimum
assignment amount is to be determined as of the Trade
Date.











Effective
      Date:
            _____________,
      20____ [TO BE INSERTED BY THE ADMINISTRATIVE AGENT AND WHICH SHALL BE THE
      EFFECTIVE DATE OF RECORDATION OF TRANSFER IN THE REGISTER
      THEREFOR]





The terms
set forth in this Assignment and Assumption are hereby agreed to:





ASSIGNOR(S)





See Schedules attached
hereto








ASSIGNEE(S)





See Schedules attached
hereto














[Consented
to and]6 Accepted:





WACHOVIA
      BANK, NATIONAL ASSOCIATION,as
      Administrative AgentBy: __________________________________
                Name:_______________________________Title:
      ________________________________








WACHOVIA
      BANK, NATIONAL ASSOCIATION,as
      Swingline Lender and Issuing LenderBy: _________________________________
              Name:_______________________________Title:________________________________








[Consented
to:]7





LMI
      AEROSPACE, INC.By: _________________________________
              Title:





6 To
be added only if the consent of the Administrative Agent and/or the Swingline
Lender and Issuing Lender is required by the terms of the Credit Agreement. May
also use a Master Consent


7 To
be added only if the consent of the Borrower is required by the terms of the
Credit Agreement. May also use a Master Consent.











SCHEDULE
1


To
Assignment and Assumption





By its
execution of this Schedule, the Assignee agrees to the terms set forth in the
attached Assignment and Assumption.





Assigned
Interests:





Facility
                      Assigned8
                    Aggregate
                      Amount
      of
                      Commitment/
                      Loans
      for all
                      Lenders7
                    Amount
      of
                      Commitment/
                      Loans
      Assigned9
                    Percentage
                      Assigned
      of
                      Commitment/
                      Loans10
                    CUSIP
      Number$
                    $
                    %$
                    $
                    %$
                    $
                    %








[NAME
      OF ASSIGNEE][and
      is an Affiliate/Approved Fund of [identifyLender]11]By:  _____________________________________Name:
      __________________________________Title:
      ____________________________________











8 Fill
in the appropriate terminology for the types of facilities under the Credit
Agreement that are being assigned under this Assignment (e.g. "Revolving Credit
Commitment," etc.).


9 Amount
to be adjusted by the counterparties to take into account any payments or
prepayments made between the Trade Date and the Effective
Date.


10 Set
forth, to at least 9 decimals, as a percentage of the Commitment/Loans of all
Lenders thereunder.


11 Select
as applicable.











SCHEDULE
2


To
Assignment and Assumption





By its
execution of this Schedule, the Assignor agrees to the terms set forth in the
attached Assignment and Assumption.





Assigned
Interests:





Facility
                      Assigned12
                    Aggregate
                      Amount
      of
                      Commitment/
                      Loans
      for all Lenders11
                    Amount
      of
                      Commitment/
                      Loans
                      Assigned13
                    Percentage
                      Assigned
      of
                      Commitment/
                      Loans14
                    CUSIP
      Number$
                    $
                    %$
                    $
                    %$
                    $
                    %











[NAME
      OF ASSIGNOR]By: _________________________________Name:Title:














12 Fill
in the appropriate terminology for the types of facilities under the Credit
Agreement that are being assigned under this Assignment (e.g. "Revolving Credit
Commitment," etc.)


13 Amount
to be adjusted by the counterparties to take into account any payments or
prepayments made between the Trade Date and the Effective
Date.


14 Set
forth, to at least 9 decimals, as a percentage of the Commitment/Loans of all
Lenders thereunder.











ANNEX 1


to
Assignment and Assumption





STANDARD
TERMS AND CONDITIONS FOR


ASSIGNMENT
AND ASSUMPTION





1.           Representations and
Warranties.




1.1  Assignor[s].
[The][Each] Assignor (a) represents and warrants that (i) it is the legal and
beneficial owner of [the][the relevant] Assigned Interest, (ii) [the][such]
Assigned Interest is free and clear of any lien, encumbrance or other adverse
claim and (iii) it has full power and authority, and has taken all action
necessary, to execute and deliver this Assignment and Assumption and to
consummate the transactions contemplated hereby; and (b) assumes no
responsibility with respect to (i) any statements, warranties or representations
made in or in connection with the Credit Agreement or any other Loan Document,
(ii) the execution, legality, validity, enforceability, genuineness, sufficiency
or value of the Loan Documents or any collateral thereunder, (iii) the financial
condition of the Borrower, any of its Subsidiaries or Affiliates or any other
Person obligated in respect of any Loan Document or (iv) the performance or
observance by the Borrower, any of its Subsidiaries or Affiliates or any other
Person of any of their respective obligations under any Loan
Document.





1.2. Assignee[s].
[The][Each] Assignee (a) represents and warrants that (i) it has full power and
authority, and has taken all action necessary, to execute and deliver this
Assignment and Assumption and to consummate the transactions contemplated hereby
and to become a Lender under the Credit Agreement, (ii) it meets all the
requirements to be an assignee under Section 13.10 of the
Credit Agreement (subject to such consents, if any, as may be required under
Section
13.10(b)(ii) of the Credit Agreement), (iii) from and after the Effective
Date, it shall be bound by the provisions of the Credit Agreement as a Lender
thereunder and, to the extent of [the][the relevant] Assigned Interest, shall
have the obligations of a Lender thereunder, (iv) it is sophisticated with
respect to decisions to acquire assets of the type represented by the Assigned
Interest and either it, or the person exercising discretion in making its
decision to acquire the Assigned Interest, is experienced in acquiring assets of
such type, (v) it has received a copy of the Credit Agreement, and has received
or has been accorded the opportunity to receive copies of the most recent
financial statements delivered pursuant to Sections 5.2 or 7.1.
thereof, as applicable, and such other documents and information as it deems
appropriate to make its own credit analysis and decision to enter into this
Assignment and Assumption and to purchase [the][such] Assigned Interest, (vi) it
has, independently and without reliance upon the Administrative Agent or any
other Lender and based on such documents and information as it has deemed
appropriate, made its own credit analysis and decision to enter into this
Assignment and Assumption and to purchase [the][such] Assigned Interest, and
(vii) if it is a Foreign Lender, attached to the Assignment and Assumption is
any documentation required to be delivered by it pursuant to the terms of the
Credit Agreement, duly completed and executed by [the][such] Assignee; and (b)
agrees that (i) it will, independently and without reliance on the
Administrative Agent, [the][any] Assignor 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 the Loan
Documents, and (ii) it will perform in accordance with their terms all of the
obligations which by the terms of the Loan Documents are required to be
performed by it as a Lender.




2.           
Payments. From
and after the Effective Date, the Administrative Agent shall make all payments
in respect of [the][each] Assigned Interest (including payments of principal,
interest, fees and other amounts) to [the][the relevant] Assignor for amounts
which have accrued to but excluding the Effective Date and to [the][the
relevant] Assignee for amounts which have accrued from and after the Effective
Date.





3.           
General
Provisions. This Assignment and Assumption shall be binding upon, and
inure to the benefit of, the parties hereto and their respective successors and
assigns. This Assignment and Assumption may be executed in any number of
counterparts, which together shall constitute one instrument. Delivery of an
executed counterpart of a signature page of this Assignment and Assumption by
telecopy shall be effective as delivery of a manually executed counterpart of
this Assignment and Assumption. This Assignment and Assumption shall be governed
by, and construed in accordance with, the law of the State of New
York.











EXHIBIT
H


to


Credit
Agreement


dated as
of July 31, 2007


by and
among


LMI
Aerospace, Inc.,


as
Borrower,


the
Lenders party thereto,


as
Lenders


and


Wachovia
Bank, National Association,


as
Administrative Agent











FORM OF GUARANTY
AGREEMENT











EXECUTION
COPY





































SUBSIDIARY
GUARANTY AGREEMENT





dated as
of July 31, 2007





by and
among





Certain
Subsidiaries of


LMI
AEROSPACE, INC.





as
Subsidiary Guarantors,





in favor
of





WACHOVIA
BANK, NATIONAL ASSOCIATION,





as
Administrative Agent

























TABLE
OF CONTENTS
  Page
 ARTICLE
      I DEFINED TERMS
                      1SECTION
      1.1
                      Definitions
                      1SECTION
      1.2
                      Other
      Definitional Provisions
                      1
 
 ARTICLE
      II SUBSIDIARY GUARANTY
                                        2SECTION
      2.1
                                        Subsidiary
      Guaranty
                                        2SECTION
      2.2
                                        Bankruptcy
      Limitations on Subsidiary Guarantors
                                        2SECTION
      2.3
                                        Agreements
      for Contribution
                                        3SECTION
      2.4
                                        Nature
      of Subsidiary Guaranty
                                        4SECTION
      2.5
                                        Waivers
                                        5SECTION
      2.6
                                        Modification
      of Loan Documents, etc.
                                        6SECTION
      2.7
                                        Demand
      by the Administrative Agent
                                        7SECTION
      2.8
                                        Remedies
                                        7SECTION
      2.9
                                        Benefits
      of Subsidiary Guaranty
                                        7SECTION
      2.10
                                        Termination;
      Reinstatement
                                        7SECTION
      2.11
                                        Payments
                                        8
 
 ARTICLE
      III REPRESENTATIONS AND WARRANTIES
                      8
  ARTICLE
      IV MISCELLANEOUS
                                                                      9SECTION
      4.1
                                                                      Notices
                                                                      9SECTION
      4.2
                                                                      Amendments,
      Waivers and Consents
                                                                      9SECTION
      4.3
                                                                      Expenses,
      Indemnification, Waiver of Consequential Damages, etc
                                                                      9SECTION
      4.4
                                                                      Right
      of Set-off
                                                                      9SECTION
      4.5
                                                                      Governing
      Law; Jurisdiction; Venue; Service of Process
                                                                      10SECTION
      4.6
                                                                      Waiver
      of Jury Trial
                                                                      11SECTION
      4.7
                                                                      Injunctive
      Relief; Punitive Damages
                                                                      11SECTION
      4.8
                                                                      No
      Waiver by Course of Conduct, Cumulative Remedies
                                                                      11SECTION
      4.9
                                                                      Successors
      and Assigns
                                                                      11SECTION
      4.10
                                                                      Survival
      of Indemnities
                                                                      12SECTION
      4.11
                                                                      All
      Powers Coupled With Interest
                                                                      12SECTION
      4.12
                                                                      Titles
      and Captions
                                                                      12SECTION
      4.13
                                                                      Severability
      of Provisions
                                                                      12SECTION
      4.14
                                                                      Counterparts
                                                                      12SECTION
      4.15
                                                                      Integration
                                                                      12SECTION
      4.16
                                                                      Advice
      of Counsel, No Strict Construction
                                                                      12SECTION
      4.17
                                                                      Acknowledgements
                                                                      12SECTION
      4.18
                                                                      Releases
                                                                      13SECTION
      4.19
                                                                      Additional
      Subsidiary Guarantors
                                                                      13SECTION
      4.20
                                                                      Secured
      Parties
                                                                      13




SUBSIDIARY GUARANTY AGREEMENT (as
amended, restated, supplemented or otherwise modified from time to time, this
"Subsidiary
Guaranty"), dated as of July 31, 2007, is made by certain Subsidiaries of
LMI AEROSPACE, INC., a Missouri corporation (such Subsidiaries, collectively,
the "Subsidiary
Guarantors", each, a "Subsidiary
Guarantor"), in favor of WACHOVIA BANK, NATIONAL ASSOCIATION, as
Administrative Agent (in such capacity, the "Administrative
Agent") for the ratable benefit of the Secured Parties.





STATEMENT OF
PURPOSE




Pursuant
to the terms of the Credit Agreement, dated of even date herewith (as amended,
restated, supplemented or otherwise modified from time to time, the "Credit Agreement"),
by and among LMI Aerospace, Inc., a Missouri corporation (the "Borrower"), the banks
and other financial institutions from time to time party thereto (the "Lenders") and the
Administrative Agent, the Lenders have agreed to make Extensions of Credit to
the Borrower upon the terms and subject to the conditions set forth
therein.





The Borrower and the Subsidiary
Guarantors, though separate legal entities, comprise one integrated financial
enterprise, and all Extensions of Credit to the Borrower will inure, directly or
indirectly, to the benefit of each of the Subsidiary Guarantors.





It is a condition precedent to the
obligation of the Lenders to make their respective Extensions of Credit to the
Borrower under the Credit Agreement that the Subsidiary Guarantors shall have
executed and delivered this Subsidiary Guaranty to the Administrative Agent, for
the ratable benefit of the Secured Parties.





NOW, THEREFORE, for good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged by
the parties hereto, and to induce the Administrative Agent and the Lenders to
enter into the Credit Agreement and to induce the Lenders to make their
respective Extensions of Credit to the Borrower thereunder, the Subsidiary
Guarantors hereby agree with the Administrative Agent, for the ratable benefit
of the Secured Parties, as follows:





ARTICLE
I





DEFINED
TERMS





SECTION
1.1                                Definitions. The
following terms when used in this Subsidiary Guaranty shall have the meanings
assigned to them below:





"Additional Guarantor"
means each Domestic Subsidiary of the Parent which hereafter becomes a
Subsidiary Guarantor pursuant to Section 4.19 hereof
and Section
8.11 of the Credit Agreement.




"Applicable Insolvency
Laws" means all Applicable Law governing bankruptcy, reorganization,
arrangement, adjustment of debts, relief of debtors, dissolution, insolvency,
fraudulent transfers or conveyances or other similar laws (including, without
limitation, 11 U.S.C. Sections 544, 547, 548 and 550 and other "avoidance"
provisions of Title 11 of the United States Code, as amended or
supplemented).





"Guaranteed
Obligations" has the meaning set forth in Section
2.1.





SECTION
1.2.                                Other Definitional
Provisions. Capitalized terms used and not otherwise defined in this
Subsidiary Guaranty, including the preambles and recitals hereof, shall have the
meanings ascribed to them in the Credit Agreement. In the event of a conflict
between capitalized terms defined herein and in the Credit Agreement, the Credit
Agreement shall control. The words "hereof," "herein", "hereto" and "hereunder"
and words of similar import when used in this Subsidiary Guaranty shall refer to
this Subsidiary Guaranty as a whole and not to any particular provision of this
Subsidiary Guaranty, and Section references are to this Subsidiary Guaranty
unless otherwise specified. The meanings given to terms defined herein shall be
equally applicable to both the singular and plural forms of such terms. Where
the context requires, terms relating to the Collateral or any part thereof, when
used in relation to a Subsidiary Guarantor, shall refer to such Subsidiary
Guarantor's Collateral or the relevant part thereof.




ARTICLE
II





SUBSIDIARY
GUARANTY




SECTION
2.1                                Subsidiary Guaranty.
Each Subsidiary Guarantor hereby, jointly and severally with the other
Subsidiary Guarantors, unconditionally guarantees to the Administrative Agent
for the ratable benefit of the Secured Parties, and their respective permitted
successors, endorsees, transferees and assigns, the prompt payment and
performance of all Obligations, whether primary or secondary (whether by way of
endorsement or otherwise), whether now existing or hereafter arising, whether or
not from time to time reduced or extinguished (except by payment thereof) or
hereafter increased or incurred, whether enforceable or unenforceable as against
the Parent, the Borrower or any other Person, whether or not discharged, stayed
or otherwise affected by any Applicable Insolvency Law or proceeding thereunder,
whether created directly with the Administrative Agent or any other Secured
Party or acquired by the Administrative Agent or any other Secured Party through
assignment or endorsement or otherwise, whether matured or unmatured, whether
joint or several, as and when the same become due and payable (whether at
maturity or earlier, by reason of acceleration, mandatory repayment or
otherwise), in accordance with the terms of any such instruments evidencing any
such obligations, including all renewals, extensions or modifications thereof
(all of the foregoing being hereafter collectively referred to as the "Guaranteed
Obligations").





SECTION
2.2                                Bankruptcy Limitations on
Subsidiary Guarantors. Notwithstanding anything to the contrary contained
in. Section 2.1
it is the intention of each Subsidiary Guarantor and the Secured Parties that,
in any proceeding involving the bankruptcy, reorganization, arrangement,
adjustment of debts, relief of debtors, dissolution or insolvency or any similar
proceeding with respect to any Subsidiary Guarantor or its assets, the amount of
such Subsidiary Guarantor's obligations with respect to the Guaranteed
Obligations shall be equal to, but not in excess of, the maximum amount thereof
not subject to avoidance or recovery by operation of Applicable Insolvency Laws
after giving effect to Section 2.3(a). To
that end, but only in the event and to the extent that after giving effect to
Section 2.3(a)
such Subsidiary Guarantor's obligations with respect to the Guaranteed
Obligations or any payment made pursuant to such Guaranteed Obligations would,
but for the operation of the first sentence of this Section 2.2 be
subject to avoidance or recovery in any such proceeding under Applicable
Insolvency Laws after giving effect to Section 2.3(a) the
amount of such Subsidiary Guarantor's obligations with respect to the Guaranteed
Obligations shall be limited to the largest amount which, after giving effect
thereto, would not, under Applicable Insolvency Laws, render such Subsidiary
Guarantor's obligations with respect to the Guaranteed Obligations unenforceable
or avoidable or otherwise subject to recovery under Applicable Insolvency Laws.
To the extent any payment actually made pursuant to the Guaranteed Obligations
exceeds the limitation of the first sentence of this Section 2.2 and is
otherwise subject to avoidance and recovery in any such proceeding under
Applicable Insolvency Laws, the amount subject to avoidance shall in all events
be limited to the amount by which such actual payment exceeds such limitation
and the Guaranteed Obligations as limited by the first sentence of this Section 2.2 shall in
all events remain in full force and effect and be fully enforceable against such
Subsidiary Guarantor. The first sentence of this Section 2.2 is
intended solely to preserve the rights of the Administrative Agent hereunder
against such Subsidiary Guarantor in such proceeding to the maximum extent
permitted by Applicable Insolvency Laws and neither the Parent, the Borrower,
such Subsidiary Guarantor, any other Subsidiary Guarantor, any other guarantor,
nor any other Person shall have any right or claim under such sentence that
would not otherwise be available under Applicable Insolvency Laws in such
proceeding.




SECTION
2.3                                Agreements for
Contribution.




(a)           Right of
Contribution. The Subsidiary Guarantors hereby agree among themselves
that, if any Subsidiary Guarantor shall make an Excess Payment (as defined
below), such Subsidiary Guarantor shall have a right of contribution from each
other Subsidiary Guarantor in an amount equal to such other Subsidiary
Guarantor's Contribution Share (as defined below) of such Excess Payment. The
payment obligations of any Subsidiary Guarantor under this Section 2.3(a) shall
be subordinate and subject in right of payment to the Guaranteed Obligations
until such time as the Guaranteed Obligations (other than (i) any contingent
indemnity obligations not yet due and (ii) the Specified Obligations) have been
indefeasibly paid in full in cash and the Revolving Credit Commitment
terminated, and none of the Subsidiary Guarantors shall exercise any right or
remedy under this Section 2.3(a)
against any other Subsidiary Guarantor until such Guaranteed Obligations (other
than (i) any contingent indemnity obligations not yet due and (ii) the Specified
Obligations) have been indefeasibly paid in full in cash and the Revolving
Credit Commitment terminated. For purposes of this Section 2.3(a), (i)
"Excess
Payment" shall mean the amount paid by any Subsidiary Guarantor in excess
of its Ratable Share (as defined below) of any Guaranteed Obligations; (ii)
"Ratable Share"
shall mean, for any Subsidiary Guarantor in respect of any payment of Guaranteed
Obligations, the ratio (expressed as a percentage) as of the date of such
payment of Guaranteed Obligations of (A) the amount by which the aggregate
present fair salable value of all of its assets and properties exceeds the
amount of all debts and liabilities of such Subsidiary Guarantor (including
probable contingent, subordinated, unmatured, and unliquidated liabilities, but
excluding the obligations of such Subsidiary Guarantor hereunder) to (B) the
amount by which the aggregate present fair salable value of all assets and other
properties of all of the Subsidiary Guarantors exceeds the amount of all of the
debts and liabilities (including probable contingent, subordinated, unmatured,
and unliquidated liabilities, but excluding the obligations of the Subsidiary
Guarantors hereunder) of all of the Subsidiary Guarantors; provided, however, that, for
purposes of calculating the Ratable Shares of the Subsidiary Guarantors in
respect of any payment of Guaranteed Obligations, any Subsidiary Guarantor that
became a Subsidiary Guarantor subsequent to the date of any such payment shall
be deemed to have been a Subsidiary Guarantor on the date of such payment and
the financial information for such Subsidiary Guarantor as of the date such
Subsidiary Guarantor became a Subsidiary Guarantor shall be utilized for such
Subsidiary Guarantor in connection with such payment; and (iii) "Contribution Share"
shall mean, for any Subsidiary Guarantor in respect of any Excess Payment made
by any other Subsidiary Guarantor, the ratio (expressed as a percentage) as of
the date of such Excess Payment of (A) the amount by which the aggregate present
fair salable value of all of its assets and properties exceeds the amount of all
debts and liabilities of such Subsidiary Guarantor (including probable
contingent, subordinated, unmatured, and unliquidated liabilities, but excluding
the obligations of such Subsidiary Guarantor hereunder) to (B) the amount by
which the aggregate present fair salable value of all assets and other
properties of all of the Subsidiary Guarantors other than the maker of such
Excess Payment exceeds the amount of all of the debts and liabilities (including
probable contingent, subordinated, unmatured, and unliquidated liabilities, but
excluding the obligations of the Subsidiary Guarantors) of all of the Subsidiary
Guarantors other than the maker of such Excess Payment; provided, however, that, for
purposes of calculating the Contribution Shares of the Subsidiary Guarantors in
respect of any Excess Payment, any Subsidiary Guarantor that became a Subsidiary
Guarantor subsequent to the date of any such Excess Payment shall be deemed to
have been a Subsidiary Guarantor on the date of such Excess Payment and. the
financial information for such Subsidiary Guarantor as of the date such
Subsidiary Guarantor became a Subsidiary Guarantor shall be utilized for such
Subsidiary Guarantor in connection with such Excess Payment. Each of the
Subsidiary Guarantors recognizes and acknowledges that the rights to
contribution arising hereunder shall constitute an asset in favor of the party
entitled to such contribution. This Section 2.3 shall not
be deemed to affect any right of subrogation, indemnity, reimbursement or
contribution that any Subsidiary Guarantor may have under Applicable Law against
the Borrower in respect of any payment of Guaranteed Obligations.




(b)           No Subrogation.
Notwithstanding any payment or payments by any of the Subsidiary Guarantors
hereunder, or any set-off or application of funds of any of the Subsidiary
Guarantors by the Administrative Agent, the Control Agent or any other Secured
Party, or the receipt of any amounts by the Administrative Agent, the Control
Agent or any other Secured Party with respect to any of the Guaranteed
Obligations, none of the Subsidiary Guarantors shall be entitled to be
subrogated to any of the rights of the Administrative Agent, the Control Agent
or any other Secured Party against the Parent, the Borrower, the other
Subsidiary Guarantors, any other guarantor, any other Person or against any
collateral security held by the Administrative Agent, the Control Agent or any
other Secured Party for the payment of the Guaranteed Obligations nor shall any
of the Subsidiary Guarantors seek any reimbursement from the Parent, the
Borrower, any of the other Subsidiary Guarantors, any other guarantor or any
other Person in respect of payments made by such Subsidiary Guarantor in
connection with the Guaranteed Obligations, until all amounts owing to the
Administrative Agent and the other Secured Parties on account of the Guaranteed
Obligations (other than (i) any contingent indemnity obligations not yet due and
(ii) the Specified Obligations) are indefeasibly paid in full in cash and the
Revolving Credit Commitment is terminated. If any amount shall be paid to any
Subsidiary Guarantor on account of such subrogation rights at any time when all
of the Guaranteed Obligations (other than (i) any contingent indemnity
obligations not yet due and (ii) the Specified Obligations) shall not have been
indefeasibly paid in cash in full, such amount shall be held by such Subsidiary
Guarantor in trust for the Administrative Agent, segregated from other funds of
such Subsidiary Guarantor, and shall, forthwith upon receipt by such Subsidiary
Guarantor, be turned over to the Administrative Agent in the exact form received
by such Subsidiary Guarantor (duly endorsed by such Subsidiary Guarantor to the
Administrative Agent, if required) to be applied against the Guaranteed
Obligations, whether matured or unmatured, in such order as set forth in the
Credit Agreement.





SECTION
2.4                                Nature of Subsidiary
Guaranty.




(a)           Each
Subsidiary Guarantor agrees that this Subsidiary Guaranty is a continuing,
unconditional guaranty of payment and performance and not of collection, and
that its obligations under this Subsidiary Guaranty shall be primary, absolute
and unconditional, irrespective of, and unaffected by:





(i)
              the
      genuineness, validity, regularity, enforceability or any future amendment
      of, or change in, the Credit Agreement, any other Loan Document, any
      Specified Hedge Agreement, any Specified Cash Management Arrangement or
      any other agreement, document or instrument to which the Parent, the
      Borrower, any Subsidiary Guarantor or any of their respective Subsidiaries
      or Affiliates is or may become a
party;





(ii)
              the
      absence of any action to enforce this Subsidiary Guaranty, the Credit
      Agreement, any other Loan Document, any Specified Hedge Agreement or any
      Specified Cash Management Arrangement, or the waiver or consent by the
      Administrative Agent, the Control Agent or any other Secured Party with
      respect to any of the provisions of this Subsidiary Guaranty, the Credit
      Agreement, any other Loan Document, any Specified Hedge Agreement or any
      Specified Cash Management
Arrangement;





(iii)
              the
      existence, value or condition of, or failure to perfect its Lien against,
      any security for or other guaranty of the Guaranteed Obligations, or any
      action, or the absence of any action, by the Administrative Agent, the
      Control Agent or any other Secured Party in respect of such security or
      guaranty (including, without limitation, the release of any such security
      or guaranty);





(iv)
              any
      structural change in, restructuring of or other similar organizational
      change of the Parent, the Borrower, any Subsidiary Guarantor, any other
      guarantors or any of their respective Subsidiaries or Affiliates;
      or





(v)
              to
      the extent permitted by Applicable Law, any other action or circumstances
      which might otherwise constitute a legal or equitable discharge or defense
      of a surety or guarantor (other than
payment);





it being
agreed by each Subsidiary Guarantor that, subject to the first sentence of Section 2.2, its
obligations under this Subsidiary Guaranty shall not be discharged until the
final indefeasible payment and performance, in full, of the Guaranteed
Obligations (other than (A) any contingent indemnity obligations not yet due and
(B) the Specified Obligations) and the termination of the Revolving Credit
Commitment.





(b)           Each
Subsidiary Guarantor represents, warrants and agrees that the Guaranteed
Obligations and its obligations under this Subsidiary Guaranty are not and shall
not be subject to any counterclaims, offsets or defenses of any kind (other than
the defense of payment) against the Administrative Agent, the Control Agent, the
other Secured Parties, the Parent or the Borrower whether now existing or which
may arise in the future.





(c)           Each
Subsidiary Guarantor hereby agrees and acknowledges that the Guaranteed
Obligations, and any of them, shall conclusively be deemed to have been created,
contracted or incurred, or renewed, extended, amended or waived, in reliance
upon this Subsidiary Guaranty, and all dealings between the Borrower and any of
the Subsidiary Guarantors, on the one hand, and the Administrative Agent and the
other Secured Parties, on the other hand, likewise shall be conclusively
presumed to have been had or consummated in reliance upon this Subsidiary
Guaranty.





SECTION
2.5                                Waivers. To the
extent permitted by Applicable Law, each Subsidiary Guarantor expressly waives
all of the following rights and defenses (and agrees not to take advantage of or
assert any such right or defense):





(a)           any
rights it may now or in the future have under any statute, or at law or in
equity, or otherwise, to compel the Administrative Agent, the Control Agent or
any other Secured Party to proceed in respect of the Guaranteed Obligations
against the Parent, the Borrower, any other Subsidiary Guarantor, any other
guarantor or any other Person or against any security for or other guaranty of
the payment and performance of the Guaranteed Obligations before proceeding
against, or as a condition to proceeding against, such Subsidiary
Guarantor,





(b)           any
defense based upon the failure of the Administrative Agent, the Control Agent or
any other Secured Party to commence an action in respect of the Guaranteed
Obligations against the Parent, the Borrower, such Subsidiary Guarantor, any
other Subsidiary Guarantor, any other guarantor or any other Person or any
security for the payment and performance of the Guaranteed
Obligations;





(c)           any
right to insist upon, plead or in any manner whatever claim or take the benefit
or advantage of, any appraisal, valuation, stay, extension, marshalling of
assets or redemption laws, or exemption, whether now or at any time hereafter in
force, which may delay, prevent or otherwise affect the performance by such
Subsidiary Guarantor of its obligations under, or the enforcement by the
Administrative Agent or the other Secured Parties of this Subsidiary
Guaranty;





(d)           any
right of diligence, presentment, demand, protest and notice (except as
specifically required herein or in any other Loan Document) of whatever kind or
nature with respect to any of the Guaranteed Obligations and waives, to the
fullest extent permitted by Applicable Law, the benefit of all provisions of
Applicable Law which are or might be in conflict with the terms of this
Subsidiary Guaranty; and





(e)           any
and all right to notice of the creation, renewal, extension or accrual of any of
the Guaranteed Obligations and notice of or proof of reliance by the
Administrative Agent or any other Secured Party upon, or acceptance of, this
Subsidiary Guaranty.




Each
Subsidiary Guarantor agrees that any notice or directive given at any time to
the Administrative Agent or any other Secured Party which is inconsistent with
any of the foregoing waivers shall be null and void and may be ignored by the
Administrative Agent or such other Secured Party, and, in addition, may not be
pleaded or introduced as evidence in any litigation relating to this Subsidiary
Guaranty for the reason that such pleading or introduction would be at variance
with the written terms of this Subsidiary Guaranty, unless the Administrative
Agent and the Required Lenders have specifically agreed otherwise in writing.
The foregoing waivers are of the essence of the transaction contemplated by the
Credit Agreement, the other Loan Documents, the Specified Hedge Agreements and
the Specified Cash Management Arrangements and, but for this Subsidiary Guaranty
and such waivers, the Administrative Agent and the other Secured Parties would
decline to enter into the Credit Agreement, the other Loan Documents, the
Specified Hedge Agreements and the Specified Cash Management
Arrangements.





SECTION
2.6                                Modification of Loan
Documents, etc. Neither the Administrative Agent nor any other Secured
Party shall incur any liability to any Subsidiary Guarantor as a result of any
of the following, and none of the following shall impair or release this
Subsidiary Guaranty or any of the obligations of any Subsidiary Guarantor under
this Subsidiary Guaranty:





(a)           any
change or extension of the manner, place or terms of payment of, or renewal or
alteration of all or any portion of, the Guaranteed Obligations;





(b)           any
action under or in respect of the Credit Agreement, any other Loan Document, any
Specified Hedge Agreement or any Specified Cash Management Arrangement in the
exercise of any remedy, power or privilege contained therein or available to any
of them at law, in equity or otherwise, or waiver or refraining from exercising
any such remedies, powers or privileges;





(c)           any
amendment to, or modification of, in any manner whatsoever, the Credit
Agreement, any other Loan Document, any Specified Hedge Agreement or any
Specified Cash Management Arrangement;





(d)           any
extension or waiver. of the time for performance by the Parent, the Borrower,
any Subsidiary Guarantor, any other guarantor, or any other Person of, or
compliance with, any term, covenant or agreement on its part to be performed or
observed under the Credit Agreement, any other Loan Document, any Specified
Hedge Agreement or any Specified Cash Management Arrangement, or waiver of such
performance or compliance or consent to a failure of, or departure from, such
performance or compliance;





(e)           the
taking and holding of security or collateral for the payment of the Guaranteed
Obligations or the sale, exchange, release, disposal of, or other dealing with,
any property pledged, mortgaged or conveyed, or in which the Administrative
Agent or the other Secured Parties have been granted a Lien, to secure any
Indebtedness of the Parent, the Borrower, any Subsidiary Guarantor, any other
guarantor or any other Person to the Administrative Agent or the other Secured
Parties;




(f)           the
release of anyone who may be liable in any manner for the payment of any amounts
owed by the Parent, the Borrower, any Subsidiary Guarantor, any other guarantor
or any other Person to the Administrative Agent or any other Secured
Party;





(g)           any
modification or termination of the terms of any intercreditor or subordination
agreement pursuant, to which claims of other creditors of the Parent, the
Borrower, any Subsidiary Guarantor, any other guarantor or any other Person are
subordinated to the claims of the Administrative Agent or any other Secured
Party; or





(h)           any
application of any sums by whomever paid or however realized to any Guaranteed
Obligations owing by the Parent, the Borrower, any Subsidiary Guarantor, any
other guarantor or any other Person to the Administrative Agent or any other
Secured Party in such manner as the Administrative Agent or any other Secured
Party shall determine in its reasonable discretion.





SECTION
2.7                                Demand by the Administrative
Agent. In addition to the terms set forth in this Article II and in no manner
imposing any limitation on such terms, if all or any portion of the then
outstanding Guaranteed Obligations are declared to be immediately due and
payable, then the Subsidiary Guarantors shall, upon demand in writing therefor
by the Administrative Agent to the Subsidiary Guarantors, pay all or such
portion of the outstanding Guaranteed Obligations due hereunder then declared
due and payable.





SECTION
2.8                                Remedies. Upon the
occurrence and during the continuance of any Event of Default, with the consent
of the Required Lenders, the Administrative Agent may, or upon the request of
the Required Lenders, the Administrative Agent shall, enforce against the
Subsidiary Guarantors their obligations and liabilities hereunder and exercise
such other rights and remedies as may be available to the Administrative Agent
hereunder, under the Credit Agreement, the other Loan Documents, the Specified
Hedge Agreements, the Specified Cash Management Arrangements or
otherwise.




SECTION
2.9                                Benefits of Subsidiary
Guaranty. The provisions of this Subsidiary Guaranty are for the benefit
of the Administrative Agent and the other Secured Parties and their respective
permitted successors, transferees-, endorsees and assigns, and nothing herein
contained shall impair, as between the Borrower, the Administrative Agent and
the other Secured Parties, the obligations of the Borrower under the Credit
Agreement, the other Loan Documents, the Specified Hedge Agreements or the
Specified Cash Management Arrangements. In the event all or any part of the
Guaranteed Obligations are transferred, endorsed or assigned by the
Administrative Agent or any other Secured Party to any Person or Persons as
permitted under the Credit Agreement, any reference to an "Administrative Agent"
or "Secured Party" herein shall be deemed to refer equally to such Person or
Persons.





SECTION
2.10                                Termination;
Reinstatement.




(a)           Subject
to clause (c) below, this Subsidiary Guaranty shall remain in full force and
effect until all the Guaranteed Obligations (other than (i) any contingent
indemnity obligations not yet due and (ii) the Specified Obligations) and all
the obligations of the Subsidiary Guarantors under this Subsidiary Guaranty
shall have been indefeasibly paid in full in cash and the Revolving Credit
Commitment is terminated.





(b)           No
payment made by the Parent, the Borrower, any Subsidiary Guarantor, any other
guarantor or any other Person received or collected by the Administrative Agent
or any other Secured Party from the Parent, the Borrower, any Subsidiary
Guarantor, any other guarantor or any other Person by virtue of any action or
proceeding or any set-off or appropriation or application at any time or from
time to time in reduction of or in payment of the Guaranteed Obligations shall
be deemed to modify, reduce, release or otherwise affect the liability of any
Subsidiary Guarantor hereunder which shall, notwithstanding any such payment
(other than any payment made by such Subsidiary Guarantor in respect of the
obligations of the Subsidiary Guarantors or any payment received or collected
from such Subsidiary Guarantor in respect of the obligations of the Subsidiary
Guarantors), remain liable for the obligations of the Subsidiary Guarantors up
to the maximum liability of such Subsidiary Guarantor hereunder until the
Guaranteed Obligations and all the obligations of the Subsidiary Guarantors
(other than (i) any contingent indemnity obligations not yet due and (ii) the
Specified Obligations) shall have been indefeasibly paid in full in cash and the
Revolving Credit Commitment is terminated.





(c)           Notwithstanding
anything to the contrary contained in this Subsidiary Guaranty, each Subsidiary
Guarantor agrees that, if any payment made by the Parent, the Borrower, any
Subsidiary Guarantor or any other Person applied to the Guaranteed Obligations
is at any time avoided, annulled, set aside, rescinded, invalidated, declared to
be fraudulent or preferential or otherwise required to be refunded or repaid, or
is repaid in whole or in part pursuant to a good faith settlement of a pending
or threatened avoidance claim, or the proceeds of any Collateral are required to
be refunded by the Administrative Agent or any other Secured Party to the
Borrower, its estate, trustee, receiver or any other Person, including, without
limitation, the Parent or any Subsidiary Guarantor, under any Applicable Law or
equitable cause, then, to the extent of such payment or repayment, each
Subsidiary Guarantor's liability hereunder (and any Lien or Collateral securing
such liability) shall be and remain in full force and effect, as fully as if
such payment had never been made, and, if prior thereto; this Subsidiary
Guaranty shall have been terminated, canceled or surrendered (and if any Lien or
Collateral securing such Subsidiary Guarantor's liability hereunder shall have
been released or terminated by virtue of such cancellation or surrender), this
Subsidiary Guaranty (and such Lien or Collateral) shall be reinstated in full
force and effect, and such prior cancellation or surrender shall not diminish,
release, discharge, impair or otherwise affect the obligations of such
Subsidiary Guarantor in respect of the amount of such payment (or any Lien or
Collateral securing such obligation).





SECTION
2.11                                Payments. Any
payments by the Subsidiary Guarantors shall be made to the Administrative Agent,
to be credited and applied to the Guaranteed Obligations in accordance with
Section 11.4 of
the Credit Agreement, in immediately available Dollars to an account designated
by the Administrative Agent or at the Administrative Agent's Office or at any
other address that may be specified in writing from time to time by the
Administrative Agent.




ARTICLE
III





REPRESENTATIONS AND
WARRANTIES




To induce
the Administrative Agent and the other Secured Parties to enter into the Loan
Documents, the Specified Hedge Agreements and the Specified Cash Management
Arrangements and to make any Extensions of Credit, each Subsidiary Guarantor
hereby represents and warrants that each representation and warranty contained
in Article VI
of the Credit Agreement relating to such .Subsidiary Guarantor is true and
correct in all material respects as if made by such Subsidiary Guarantor herein;
provided, that any representation or warranty that is qualified by materiality
or by reference to Material Adverse Effect shall be true and correct in all
respects.




ARTICLE
IV





MISCELLANEOUS




SECTION
4.1                                Notices. All notices
and communications hereunder shall be given to the addresses and otherwise made
in accordance with Section 13.1 of the
Credit Agreement; provided, that
notices and communications to the Subsidiary Guarantors shall be directed to the
Subsidiary Guarantors at the address of the Borrower set forth in Section 13.1 of the
Credit Agreement.





SECTION
4.2                                Amendments, Waivers and
Consents. None of the terms or provisions of this Subsidiary Guaranty may
be waived, amended, supplemented or otherwise modified, nor may any consent be
given, except in accordance with Section 13.2 of the
Credit Agreement.





SECTION
4.3                                Expenses, Indemnification,
Waiver of Consequential Damages, etc.





(a)           The
Subsidiary Guarantors shall, jointly and severally, pay all out-of-pocket
expenses (including, without limitation, attorney's fees and expenses) incurred
by the Administrative Agent and each other Secured Party to the extent the
Borrower would be required to do so pursuant to Section 13.3 of the
Credit Agreement.





(b)           The
Subsidiary Guarantors shall, jointly and severally, pay and indemnify each
Indemnitee (which for purposes of this Subsidiary Guaranty shall include,
without limitation, all Secured Parties) against Indemnified Taxes and Other
Taxes to the extent the Borrower would be required to do so pursuant to Section 4.11 of the
Credit Agreement.





(c)           The
Subsidiary Guarantors shall, jointly and severally, indemnify each Indemnitee to
the extent
the Borrower would be required to do so pursuant to Section 13.3 of the
Credit Agreement.





(d)           Notwithstanding
anything to the contrary contained in this Subsidiary Guaranty, to the fullest
extent permitted by Applicable Law, each Subsidiary Guarantor shall not assert,
and hereby waives, any claim against any Indemnitee, on any theory of liability,
for special, indirect, consequential or punitive damages (as opposed to direct
or actual damages) arising out of, in connection with, or as a result of, this
Subsidiary Guaranty, any other Loan Document, any Specified Hedge Agreement, any
Specified Cash Management Arrangement or any agreement or instrument
contemplated hereby, the transactions contemplated hereby or thereby, any Loan
or Letter of Credit or the use of the proceeds thereof.





(e)           No
Indemnitee referred to in this Section 4.3 shall be
liable for any damages arising from the use by unintended recipients of any
information or other materials distributed by it through telecommunications,
electronic or other information transmission systems in connection with this
Subsidiary Guaranty, the other Loan Documents, any Specified Hedge Agreements or
any Specified Cash Management Arrangements or the transactions contemplated
hereby or thereby.





(f)           All
amounts due under this Section 4.3 shall be
payable promptly after demand therefor.





SECTION
4.4                                Right of Set-off. If
an Event of Default shall have occurred and be continuing, subject to the terms
of the Intercreditor Agreement, each Secured Party and each of its respective
Affiliates is hereby authorized at any time and from time to time, to the
fullest extent permitted by Applicable Law, to set off and apply any and all
deposits (general or special, time or demand, provisional or final, in whatever
currency) at any time held and other obligations (in whatever currency) at any
time owing by such Secured Party or any such Affiliate to or for the credit or
the account of such Subsidiary Guarantor against any and all of the obligations
of such Subsidiary Guarantor now or hereafterexisting under this
Subsidiary Guaranty, any other Loan Document, any Specified Hedge Agreement or
any Specified Cash Management Arrangement to such Secured Party, irrespective of
whether or not such Secured Party shall have made any demand under this
Subsidiary Guaranty, any other Loan Document, any Specified Hedge Agreement or
any Specified Cash Management Arrangement and although such obligations of such
Subsidiary Guarantor may be contingent or unmatured or are owed to a branch or
office of such Secured Party different from the branch or office holding such
deposit or obligated on such indebtedness. The rights of each Secured Party and
its respective Affiliates under this Section are in addition to other rights and
remedies (including other rights of setoff) that such Secured Party or its
respective Affiliates may have. Each Secured Party agrees to notify such
Subsidiary Guarantor and the Administrative Agent promptly after any such setoff
and application; provided that
the failure to give such notice shall not affect the validity of such setoff and
application.





SECTION
4.5                                Governing Law; Jurisdiction;
Venue; Service of Process.




(a)           Governing Law. This
Subsidiary Guaranty shall be governed by, and construed in accordance with, the
laws of the State of New York (including Section 5-1401 and Section 5-1402 of
the General Obligations Law of the State of New York) without reference to the
conflicts of law principles thereof.





(b)           Submission to
Jurisdiction. Each Subsidiary Guarantor irrevocably and unconditionally
submits, for itself and its property, to the nonexclusive jurisdiction of the
courts of the State of New York sitting in the Borough of Manhattan, New York
and of the United States District Court 6f the Borough of Manhattan, New York,
and any appellate court from any thereof, in any action or proceeding arising
out of or relating to this Subsidiary Guaranty or any other Loan Document, or
for recognition or enforcement of any judgment, and each of the parties hereto
irrevocably and unconditionally agrees that all claims in respect of any such
action or proceeding may be heard and determined in such New York state court
or, to the fullest extent permitted by Applicable Law, in such federal court.
Each of the parties hereto agrees that a final judgment in any such action or
proceeding shall be conclusive and may be enforced in other jurisdictions by
suit on the judgment or in any other manner provided by law. Nothing in this
Subsidiary Guaranty or in any other Loan Document shall affect any right that
the Administrative Agent or any other Secured Party may otherwise have to bring
any action or proceeding relating to this Subsidiary Guaranty or any other Loan
Document against any Subsidiary Guarantor or its properties in the courts of any
jurisdiction.





(c)           Waiver of Venue. Each
Subsidiary Guarantor irrevocably and unconditionally waives, to the fullest
extent permitted by Applicable Law, any objection that it may now or hereafter
have to the laying of venue of any action or proceeding arising out of or
relating to this Subsidiary Guaranty or any other Loan Document in any court
referred to in paragraph (b) of this Section. Each of the parties hereto hereby
irrevocably waives, to the fullest extent permitted by Applicable Law, the
defense of an inconvenient forum to the maintenance of such action or proceeding
in any such court.





(d)           Service of Process.
Each party hereto irrevocably consents to service of process in the manner
provided for notices in Section 13.1 of the
Credit Agreement. Nothing in this Subsidiary Guaranty will affect the right of
any party hereto to serve process in any other manner permitted by Applicable
Law.





(e)           Appointment of the Borrower
as Agent for the Subsidiary Guarantors. Each Subsidiary Guarantor hereby
irrevocably appoints and authorizes the Borrower to act as its agent for service
of process and notices required to be delivered under this Subsidiary Guaranty
or under the other Loan Documents, it being understood and agreed that receipt
by the Borrower of any summons, notice or other similar item shall be deemed
effective receipt by each Subsidiary Guarantor and its
Subsidiaries.




SECTION
4.6                                Waiver of Jury
Trial.  EACH PARTY HERETO HEREBY IRREVOCABLY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY
JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING
TO THIS SUBSIDIARY GUARANTY OR ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS
CONTEMPLATED HEREBY OR THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER
THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR
ATTORNEY OF ANY OTHER PERSON HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH
OTHER PERSON WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE
FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE
BEEN INDUCED TO ENTER INTO THIS SUBSIDIARY GUARANTY AND THE OTHER LOAN DOCUMENTS
BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS
SECTION.





SECTION
4.7                                Injunctive Relief; Punitive
Damages.




(a)           Each
Subsidiary Guarantor recognizes that, in the event such Subsidiary Guarantor
fails to perform, observe or discharge any of its obligations or liabilities
under this Subsidiary Guaranty or any other Loan Document, any remedy of law may
prove to be inadequate relief to the Administrative Agent and the other Secured
Parties. Therefore, each Subsidiary Guarantor agrees that the Administrative
Agent and the other Secured Parties, at the option of the Administrative Agent
and the other Secured Parties, shall be entitled to temporary and permanent
injunctive relief in any such case without the necessity of proving actual
damages.





(b)           The
Administrative Agent, the other Secured Parties and each Subsidiary Guarantor
hereby agree that no such Person shall have a remedy of punitive or exemplary
damages against any other party to a Loan Document and each such Person hereby
waives any right or claim to punitive or exemplary damages that such Person may
now have or may arise in the future in connection with any Dispute, whether such
Dispute is resolved through arbitration or judicially.





SECTION
4.8                                No Waiver by Course of
Conduct, Cumulative Remedies. Neither the Administrative Agent nor any
other Secured Party shall by any act (except by a written instrument pursuant to
Section 4.2),
delay, indulgence, omission or otherwise be deemed to have waived any right or
remedy hereunder or to have acquiesced in any Default or Event of Default. No
delay or failure to take action on the part of the Administrative Agent or any
other Secured Party in exercising any right, power or privilege hereunder shall
operate as a waiver thereof, nor shall any single or partial exercise of any
such right, power or privilege hereunder preclude any other or further exercise
thereof or the exercise of any other right, power or privilege. A waiver by the
Administrative Agent or any other Secured Party of any right or remedy hereunder
on any one occasion shall not be construed as a bar to any right or remedy which
the Administrative Agent or such other Secured Party would otherwise have on any
future occasion. The enumeration of the rights and remedies of the
Administrative Agent and the other Secured Parties set forth in this Subsidiary
Guaranty is not intended to be exhaustive and the exercise by- the
Administrative Agent and the other Secured Parties of any right or remedy shall
not preclude the exercise of any other rights or remedies, all of which shall be
cumulative, and shall be in addition to any other right or remedy given
hereunder or under the other Loan Documents or that may now or hereafter exist
at law or in equity or by suit or otherwise.





SECTION
4.9                                Successors and
Assigns. The provisions of this Subsidiary Guaranty shall be binding upon
and inure to the benefit of the parties hereto and their respective successors
and permitted assigns; except that no Subsidiary Guarantor may assign or
otherwise transfer any of its rights or obligations under this Subsidiary
Guaranty without the prior written consent of the Administrative Agent and the
other Secured Parties (in accordance with the Credit Agreement).




SECTION
4.10                              Survival of
Indemnities. Notwithstanding any termination of this Subsidiary Guaranty,
the indemnities to which the Administrative Agent and the other Secured Parties
are entitled under the provisions of Section 4.3 and any other provision of
this Subsidiary Guaranty and the other Loan Documents shall continue in full
force and effect and shall protect the Administrative Agent and the other
Secured Parties against events arising after such termination as well as
before.





SECTION
4.11                              All Powers Coupled With
Interest. All powers of attorney and other authorizations granted to the
Secured Parties, the Administrative Agent, the Control Agent and any Persons
designated by the Administrative Agent or any other Secured Party pursuant to
any provisions of this Subsidiary Guaranty or any of the other Loan Documents
shall be deemed coupled with an interest and shall be irrevocable so long as any
of the Guaranteed Obligations remain unpaid or unsatisfied, any of the
Commitments remain in effect or the Credit Facility has not been
terminated.




SECTION
4.12                               Titles and Captions.
Titles and captions of Articles, Sections and subsections in, and the table of
contents of this Subsidiary Guaranty are for convenience only, and neither limit
nor amplify the provisions of this Subsidiary Guaranty.





SECTION
4.13                               Severability of
Provisions. Any provision of this Subsidiary Guaranty or any other Loan
Document which is prohibited or unenforceable in any jurisdiction shall, as to
such jurisdiction, be ineffective only to the extent of such prohibition or
unenforceability without invalidating the remainder of such provision or the
remaining provisions hereof or thereof or affecting the validity or
enforceability of such provision in any other jurisdiction.





SECTION
4.14                               Counterparts. This
Subsidiary Guaranty may be executed in any number of counterparts and by
different parties hereto in separate counterparts, each of which when so
executed shall be deemed to be an original and shall be binding upon all
patties, their successors and assigns, and all of which taken together shall
constitute one and the same agreement. Delivery of an executed counterpart of a
signature page to this Subsidiary Guaranty or any document or instrument
delivered in connection herewith by facsimile or other electronic transmission
shall be effective as delivery of a manually executed counterpart of this
Subsidiary Guaranty or such other document or instrument, as
applicable.





SECTION
4.15                                Integration. This
Subsidiary Guaranty, together with the other Loan Documents, comprises the
complete and integrated agreement of the parties on the subject matter hereof
and thereof and supersedes all prior agreements, written or oral, on such
subject matter. In the event of any conflict between the provisions of this
Subsidiary Guaranty and those of any other Loan Document, the provisions of the
Credit Agreement shall control; provided that the
inclusion of supplemental rights or remedies in favor of the Administrative
Agent or the other Secured Parties in any other Loan Document shall not be
deemed a conflict with this Subsidiary Guaranty.





SECTION
4.16                                Advice of
Counsel,No Strict
Construction. Each of the parties represents to each other party hereto
that it has discussed this Subsidiary Guaranty with its counsel. The parties
hereto have participated jointly in the negotiation and drafting of this
Subsidiary Guaranty. In the event an ambiguity or question of intent or
interpretation arises, this Subsidiary Guaranty shall be construed as if drafted
jointly by the parties hereto and no presumption or burden of proof shall arise
favoring or disfavoring any party by virtue of the authorship of any provisions
of this Subsidiary Guaranty.





SECTION
4.17                                Acknowledgements.
Each Subsidiary Guarantor hereby acknowledges that:





(a)           it
has been advised by counsel in the negotiation, execution and delivery of this
Subsidiary Guaranty and the other Loan Documents to which it is a
party;




(b)           it
has received a copy of the Credit Agreement and has reviewed and understands
same;




(c)           neither
the Administrative Agent nor any other Secured Party has any fiduciary
relationship with or duty to any Subsidiary Guarantor arising out of or in
connection with this Subsidiary Guaranty or any of the other Loan Documents, and
the relationship between the Subsidiary Guarantors, . on the one hand, and the
Administrative Agent and the other Secured Parties, on the other hand, in
connection herewith or therewith is solely that of debtor and creditor,
and





(d)           no
joint venture is created hereby or by the other Loan Documents or otherwise
exists by virtue of the transactions contemplated hereby or thereby among the
Secured Parties or among the Subsidiary Guarantors and the Secured
Parties.





SECTION
4.18                                Releases. Subject to
the terms of the Intercreditor Agreement, at such time as the Guaranteed
Obligations (other than (a) any contingent indemnity obligations not yet due and
(b) the Specified Obligations) shall have been indefeasibly paid in full in cash
and the Revolving Credit Commitment has been terminated, this Subsidiary
Guaranty and all obligations (other than those expressly stated to survive such
termination or as may be reinstated after such termination) of the
Administrative Agent and each Subsidiary Guarantor hereunder shall terminate,
all without delivery of any instrument or performance of any act by any party.
If all of the Capital Stock of any Subsidiary Guarantor shall be disposed of
(including by merger or consolidation) in a transaction expressly permitted by
the terms of the Credit Agreement, the guaranty provided hereby of such
Subsidiary Guarantor shall automatically be discharged and released
contemporaneously with such disposition without any further action by the
Administrative Agent, any Lender or any other Person.





SECTION
4.19                                Additional Subsidiary
Guarantors. Each Subsidiary of the Parent that is required to become a
party to this Subsidiary Guaranty pursuant to Section 8.11 of the
Credit Agreement shall become a Subsidiary Guarantor for all purposes of this
Subsidiary Guaranty upon execution and delivery by such Subsidiary of a
supplement in form and substance reasonably satisfactory to the Administrative
Agent.





SECTION
4.20                                Secured Parties. Each
Secured Party not a party to the Credit Agreement who obtains the benefit of
this Subsidiary Guaranty shall be deemed to have acknowledged and accepted the
appointment of the Administrative Agent pursuant to the terms of the Credit
Agreement, and that with respect to the actions and omissions of the
Administrative Agent hereunder or otherwise relating hereto that do or may
affect such Secured Party, the Administrative Agent and each of its Affiliates
shall be entitled to all the rights, benefits and immunities conferred under
Article XII of the Credit Agreement.





[Signature
Pages to Follow]











IN WITNESS WHEREOF, each of the
Subsidiary Guarantors has executed and delivered this Subsidiary Guaranty under
seal by its duly authorized officers, all as of the day and year first above
written.





PRECISE MACHINE COMPANY,
      as SubsidiaryGuarantorBy: __________________________________Name: _______________________________Title:  ________________________________








PRECISE MACHINE PARTNERS,
      L.L.P., asSubsidiary
      GuarantorBy:           Precise
      Machine Company, itsmanaging
      partnerBy:  _________________________________Name:  ______________________________Title: ________________________________








LEONARD'S METAL, INC.,
      as SubsidiaryGuarantorBy:  __________________________________Name: _______________________________Title: _________________________________








LMI FINISHING, INC., as
      Subsidiary GuarantorBy: __________________________________Name: _______________________________Title: ________________________________








VERSAFORM CORP., as
      Subsidiary GuarantorBy: __________________________________Name: _______________________________Title: ________________________________

















TEMPCO ENGINEERING, INC.
      as SubsidiaryGuarantorBy: __________________________________Name: _______________________________Title: ________________________________








LMI KITTING, LLC, as
      Subsidiary GuarantorBy:
      Leonard's Metal, Inc., its sole memberBy:  __________________________________Name: ________________________________Title: _________________________________








LMI-TCA, INC., as
      Subsidiary GuarantorBy: ___________________________________Name: ________________________________Title: _________________________________








D3 TECHNOLOGIES INC., as
      SubsidiaryGuarantorBy: ____________________________________Name: _________________________________Title: __________________________________








[Signature
Pages Continue]











WACHOVIA BANK, NATIONAL
      ASSOCIATION, asAdministrative
      AgentBy: _____________________________________Name: __________________________________Title: ___________________________________














EXHIBIT
I


to


Credit
Agreement


dated as
of July 31, 2007


by and
among


LMI
Aerospace, Inc.,


as
Borrower,


the
Lenders party thereto,


as
Lenders


and


Wachovia
Bank, National Association,


as
Administrative Agent











FORM OF COLLATERAL
AGREEMENT

















Execution
Copy


































COLLATERAL
AGREEMENT
 
 dated as
of July 31, 2007
 
 
 by and
among


LMI
AEROSPACE, INC.,


and
certain of its Subsidiaries


as
Grantors,





in favor
of





WACHOVIA
BANK, NATIONAL ASSOCIATION,


as
Administrative Agent

























Table
of Contents
 Page
 
 ARTICLE
      I DEFINED TERMS
                  1SECTION
      1.1
                  Terms
      Defined in the Uniform Commercial Code
                  1SECTION
      1.2
                  Definitions
                  2SECTION
      1.3
                  Other
      Definitional Provisions
                  5
 
 ARTICLE
      II SECURITY INTEREST
                  6SECTION
      2.1
                  Grant
      of Security Interest
                  6SECTION
      2.3
                  Grantors
      Remain Liable
                  8
 
 ARTICLE
      III REPRESENTATIONS AND WARRANTIES
                  8SECTION
      3.1
                  Existence
                  8SECTION
      3.2
                  Authorization
      of Agreement; No Conflict
                  9SECTION
      3.3
                  Consents
                  9SECTION
      3.4
                  Perfected
      First Priority Liens
                  9SECTION
      3.5
                  Title,
      No Other Liens
                  9SECTION
      3.6
                  State
      of Organization; Location of Inventory, Equipment andFixtures;
      Other Information
                  10SECTION
      3.7
                  Accounts
                  10SECTION
      3.8
                  Chattel
      Paper
                  11SECTION
      3.9
                  Commercial
      Tort Claims
                  11SECTION
      3.10
                  Deposit
      Accounts
                  11SECTION
      3.11
                  Intellectual
      Property
                  11SECTION
      3.12
                  Inventory
                  12SECTION
      3.13
                  Investment
      Property; Partnership/LLC Interests
                  12SECTION
      3.14
                  Instruments
                  12
 
 ARTICLE
      IV COVENANTS
                  12SECTION
      4.1
                  Maintenance
      of Perfected Security Interest; FurtherInformation
                  12SECTION
      4.2
                  Maintenance
      of Insurance
                  13SECTION
      4.3
                  Changes
      in Locations; Changes in Name or Structure
                  13SECTION
      4.4
                  Required
      Notifications
                  14SECTION
      4.5
                  Delivery
      Covenants
                  14SECTION
      4.6
                  Control
      Covenants
                  14SECTION
      4.7
                  Filing
      Covenants
                  15SECTION
      4.8
                  Accounts
                  16SECTION
      4.9
                  Intellectual
      Property
                  16SECTION
      4.10
                  Investment
      Property; Partnership/LLC Interests
                  17SECTION
      4.11
                  Equipment
                  18SECTION
      4.12
                  Vehicles
                  18SECTION
      4.13
                  Further
      Assurances; Government Contracts
                  18
 
 ARTICLE
      V REMEDIAL PROVISIONS
                  19SECTION
      5.1
                  General
      Remedies
                  19SECTION
      5.2
                  Specific
      Remedies
                  19  
  SECTION
      5.3
                      Registration
      Rights
                      22SECTION
      5.4
                      Application
      of Proceeds
                      23SECTION
      5.5
                      Waiver,
      Deficiency
                      23




ARTICLE
      VI THE ADMINISTRATIVE AGENT
                  23SECTION
      6.1
                  Administrative
      Agent's Appointment as Attorney-In-Fact
                  23SECTION
      6.2
                  Duty
      of Administrative Agent
                  25SECTION
      6.3
                  Authority
      of Administrative Agent
                  25
 
 ARTICLE
      VII MISCELLANEOUS
                  26SECTION
      7.1
                  Amendments
      in Writing
                  26SECTION
      7.2
                  Notices
                  26SECTION
      7.3
                  No
      Waiver by Course of Conduct, Cumulative Remedies
                  26SECTION
      7.4
                  Enforcement
      Expenses, Indemnification
                  26SECTION
      7.5
                  Waiver
      of Jury Trial
                  27SECTION
      7.6
                  Successors
      and Assigns
                  27SECTION
      7.7
                  Set-Off
                  27SECTION
      7.8
                  Counterparts
                  28SECTION
      7.9
                  Severability
                  28SECTION
      7.10
                  Section
      Heading
                  28SECTION
      7.11
                  Integration
                  28SECTION
      7.12
                  Governing
      Law
                  28SECTION
      7.13
                  Consent
      to Jurisdiction
                  28SECTION
      7.14
                  Acknowledgments
                  29SECTION
      7.15
                  Additional
      Grantors
                  29SECTION
      7.16
                  Releases
                  29


SCHEDULES:





Schedule
      3.6
              Exact
      Legal Name; Jurisdiction of Organization; Taxpayer Identification Number;
      Registered Organization Number; Mailing Address; Chief Executive Office
      and other Locations


Schedule
      3.7
              Material
      Government Contracts


Schedule
      3.9
              Commercial
      Tort Claims


Schedule
      3.10
            Deposit
      Accounts


Schedule
      3.11
              Intellectual
      Property


Schedule
      3.13
            Investment
      Property and Partnership/LLC
Interests








EXHIBITS:





Exhibit
      A-1
              Form
      of Assignment Agreement


Exhibit
      A-2
            Form
      of Notice of Assignment










This
COLLATERAL AGREEMENT (this "Agreement"), dated as
of July 31, 2007, is by and among LMI AEROSPACE, INC., a Missouri corporation
(the "Borrower"), certain
of its Subsidiaries as identified on the signature pages hereto and any
Additional Grantor (as defined below) who may become party to this Agreement
(such Subsidiaries and Additional Grantors, collectively, with the Borrower, the
"Grantors"), in
favor of WACHOVIA BANK, NATIONAL ASSOCIATION, as Administrative Agent (in such
capacity, the "Administrative
Agent") for the ratable benefit of the banks and other financial
institutions (the "Secured Parties")
from time to time parties to the Credit Agreement, dated as of the date hereof
(as amended, restated, supplemented or otherwise modified from time to time, the
"Credit
Agreement"), by and among the Borrower, the Secured Parties, and the
Administrative Agent.





STATEMENT OF
PURPOSE





Pursuant to the Credit Agreement, the
Lenders have agreed to make Extensions of Credit to the Borrower upon the terms
and subject to the conditions set forth therein.





Pursuant to the terms of a Guaranty
Agreement of even date, certain Subsidiaries of the Borrower who are parties
hereto have guaranteed the payment and performance of the
Obligations.





It is a condition precedent to the
obligation of the Lenders to make their respective Extensions of Credit to the
Borrower under the Credit Agreement that the Grantors shall have executed and
delivered this Agreement to the Administrative Agent, for the ratable benefit of
itself and the Secured Parties.





NOW, THEREFORE, for good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged by
the parties hereto, and to induce the Administrative Agent and the Secured
Parties to enter into the Credit Agreement and to induce the Secured Parties to
make their respective Extensions of Credit to the Borrower thereunder, each
Grantor hereby agrees with the Administrative Agent, for the ratable benefit of
itself and the Secured Parties, as follows:


ARTICLE
I





DEFINED
TERMS





SECTION
1.1                                           Terms Defined in the Uniform
Commercial Code.




(a)           The
following terms when used in this Agreement shall have the meanings assigned to
them in the UCC (as defined in the Credit Agreement) as in effect from time to
time: "Account", "Account Debtor",
"Authenticate",
"Certificated
Security", "Chattel Paper";
"Commercial Tort
Claim", "Deposit Account",
"Documents",
"Electronic Chattel
Paper", "Equipment", "Farm Products" "Fixture", "General Intangible",
"Instrument",
"Inventory",
"Investment Company
Security", "Investment Property",
"Issuer",
"Letter of Credit
Rights", "Proceeds", "Record", "Registered
Organization", "Securities Account",
"Securities,
Entitlement",
"Securities
Intermediary", "Security", "Supporting
Obligation", "Tangible Chattel,
Paper", and
"Uncertificated
Security".




(b)           Terms
defined in the UCC and not otherwise defined herein or in the Credit Agreement
shall have the meaning Assigned in the UCC as in effect from time to
time.





SECTION
1.2                                           Definitions. The
following terms when used in this Agreement shall have the meanings assigned to
them below:





"Additional Grantor"
means each Subsidiary of the Borrower which hereafter becomes a Grantor pursuant
to Section 7.15
(as required pursuant to Section 8.11 of the
Credit Agreement).





"Agreement" means this
Collateral Agreement, as amended, restated, supplemented or otherwise modified
from time to time.





"Applicable Insolvency
Laws" means all Applicable Laws governing bankruptcy, reorganization,
arrangement, adjustment of debts, relief of debtors, dissolution, insolvency,
fraudulent transfers or conveyances or other similar laws (including, without
limitation, 11 U.S.C. Sections 547, 548 and 550 and other "avoidance" provisions
of Title 11 of the United States Code).





"Assignment Agreement"
means each Assignment Agreement executed by any Grantor with respect to any
Government Contract to which such Grantor is a party, substantially in the form
of Exhibit A-1 attached hereto.





"Assignment of Claims
Act" means the Assignment of Claims Act of 1940 (41 U.S.C. Section 15, 31
U.S.C. Section 3737, and 31 U.S.C. Section 3727), including all amendments
thereto and regulations promulgated thereunder.





"Collateral" has the
meaning assigned thereto in Section
2.1.





"Collateral Account"
means any collateral account established by the Administrative Agent as provided
in Section
5.2.





"Control" means the
manner in which "control" is achieved under the UCC, with respect to any
Collateral for which the UCC specifies a method of achieving
"control".





"Controlled
Depository" has the meaning assigned thereto in Section
4.6.





"Controlled
Intermediary" has the meaning assigned thereto in Section
4.6.





"Copyrights" means
collectively, all of the following of any Grantor: (a) all copyrights, rights
and interests in copyrights, works protectable by copyright, copyright
registrations and copyright applications anywhere in the world, including,
without limitation, those listed on Schedule 3.11 hereto,
(b) all reissues, extensions, continuations (in whole or in part) and renewals
of any of the foregoing, (c) all income, royalties, damages and payments now or
hereafter due and/or payable under any of the foregoing or with respect to any
of the foregoing, including, without limitation, damages or payments for past,
present or future infringements of any of the foregoing, (d) the right to sue
for past, present or future infringements of any of the foregoing and (e) all
rights corresponding to any of the foregoing throughout the world.




"Copyright Licenses"
means any written agreement naming any Grantor as licensor or licensee,
including, without limitation, those listed in Schedule 3.11,
granting any right under any Copyright, including, without limitation, the grant
of rights to manufacture, distribute, exploit and sell materials derived from
any Copyright.





"Effective Endorsement and
Assignment" means, with respect to any specific type of Collateral, all
such endorsements, assignments and other instruments of transfer reasonably
requested by the Administrative Agent with respect to the Security Interest
granted in such Collateral, and in each case, in form and substance satisfactory
to the Administrative Agent.





"Excluded Deposit
Account" means (a) any Deposit Account' established solely for the
purpose of (i) funding payroll, payroll taxes and other compensation and
benefits to employees or (ii) holding fiduciary funds in trust for the benefit
of third parties, (b) so long as no Default or Event of Default has occurred and
is continuing, (i) any Deposit Account established solely for the purpose of
funding petty cash (provided that the
aggregate amount deposited in such accounts shall at no time exceed $75,000) and
(ii) Deposit Accounts (other than the Collateral Account) with amounts on
deposit that, when aggregated with amounts on deposit in all other Deposit
Accounts for which a control agreement has not been obtained (other than those
specified in clause (a) and clause (b)), do not exceed $100,000 at any
time.





"Excluded Securities
Account" means any Securities Account provided that the value of all such
Securities Accounts does not exceed $100,000 in the aggregate at any
time.





"Government Contract"
means a contract between any Grantor and an agency, department or
instrumentality of the United States or any state, municipal or local
Governmental Authority located in the United States or all obligations of any
such Governmental Authority arising under any Account now or hereafter owing by
any such Governmental Authority, as account debtor, to any Grantor.





"Grantors" has the
meaning set forth in the Preamble of this Agreement.





"Intellectual
Property" means collectively, all of the following of any Grantor: (a)
all systems software, applications software and internet rights, including,
without limitation, screen displays and formats, internet domain names, web
sites (including web links), program structures, sequence and organization, all
documentation for such software, including, without limitation, user manuals,
flowcharts, programmer's notes, functional specifications, and operations
manuals, all formulas, processes, ideas and know-how embodied in any of the
foregoing, and all program materials, flowcharts, notes and outlines created in
connection with any of the foregoing, whether or not patentable or
copyrightable, (b) concepts, discoveries, improvements and ideas, (c) any useful
information relating to the items described in clause (a) or (b), including
know-how, technology, engineering drawings, reports, design information, trade
secrets, practices, laboratory notebooks, specifications, test procedures,
maintenance manuals, research, development, manufacturing, marketing,
merchandising, selling, purchasing and accounting, (d) Patents and Patent
Licenses, Copyrights and Copyright Licenses, Trademarks and Trademark Licenses,
and (e) other licenses to use any of the items described in the foregoing
clauses (a), (b), (c) and (d) or any other similar items of such Grantor
necessary for the conduct of its business.




"Issuer" means any
issuer of any Investment Property or Partnership/LLC Interests (including,
without limitation, any Issuer as defined in the UCC).





"Material Government
Contract" means any Government Contract of any Grantor from which such
Grantor reasonably expects to derive during any period of four (4) fiscal
quarters immediately following the most recent fiscal quarter, revenues in
excess of $1,000,000.





"Notice of Assignment"
mean each Notice of Assignment executed by any Grantor with respect to any
Government Contract to which such Grantor is a party, substantially in the form
of Exhibit A-2.





"Obligations" means
with respect to the Borrower, the meaning assigned thereto in the Credit
Agreement, and with respect to each Guarantor, the obligations of such Guarantor
under the Guaranty Agreement executed by such Guarantor and with respect to all
Grantors, all liabilities and obligations of the Grantors hereunder and all
liabilities and obligations of the Grantors with respect to overdrafts, returned
items and related liabilities and all indemnification obligations under the Loan
Documents now or hereafter owing by any Grantor to any Lender, any Affiliate
thereof or the Administrative Agent arising from or in connection with treasury,
depositary or cash management services or in connection with any automated
clearinghouse transfer of funds for the benefit of such Grantor.





"Partnership/LLC
Interests" means, with respect to any Grantor, the entire partnership,
membership interest or limited liability company interest, as applicable, of
such Grantor in each partnership, limited partnership or limited liability
company owned thereby, including, without limitation, such Grantor's capital
account, its interest as a partner or member, as applicable, in the net cash
flow, net profit and net loss, and items of income, gain, loss, deduction and
credit of any such partnership, limited partnership or limited liability
company, as applicable, such Grantor's interest in all distributions made or to
be made by any such partnership, limited partnership or limited liability
company, as applicable, to such Grantor and all of the other economic rights,
titles and interests of such Grantor as a partner or member, as applicable, of
any such partnership, limited partnership or limited liability company, as
applicable, whether set forth in the partnership agreement or membership
agreement, as applicable, of such partnership, limited partnership or limited
liability company, as applicable, by separate agreement or
otherwise.





"Patents" means
collectively, all of the following of any Grantor: (a) all patents, rights and
interests in patents, patentable inventions and patent applications anywhere in
the world, including, without limitation, those listed on Schedule 3.11,
hereto, (b) all reissues, extensions, continuations (in whole or in part) and
renewals of any of the foregoing, (c) all income, royalties, damages or payments
now or hereafter due and/or payable under any of the foregoing or with respect
to any of the foregoing, including, without limitation, damages or payments for
past, present or future infringements of any of the foregoing, (d) the right to
sue for past, present and future infringements of any of the foregoing and (e)
all rights corresponding to any of the foregoing throughout the
world.





"Patent License" means
all agreements now or hereafter in existence, whether written, implied or oral,
providing for the grant by or to any Grantor of any right to manufacture, use or
sell any invention covered in whole or in part by a Patent, including, without
limitation, any of the foregoing referred to in Schedule 3.11
hereto.





"Restricted Securities
Collateral" has the meaning assigned thereto in Section
5.3.





"Securities Act" means
the Securities Act of 1933, including all amendments thereto and regulations
promulgated thereunder.




"Security Interests"
means the security interests granted pursuant to Article II, as well as all
other security interests created or assigned as additional security for the
Obligations pursuant to the provisions of the Credit Agreement.





"Trademarks" means
collectively all of the following of any Grantor: (a) all trademarks, rights and
interests in trademarks, trade names, corporate names, company names, business
names, fictitious business names, trade styles, service marks, logos, other
business identifiers, prints and labels on which any of the foregoing have
appeared or appear, whether registered or unregistered, all registrations and
recordings thereof, and all applications in connection therewith (other than
each application to register any trademark or service mark prior to the filing
under Applicable Law of a verified statement of use for such trademark or
service mark) anywhere in the world, including, without limitation, those listed
on Schedule
3.11 hereto, (b) all reissues, extensions, continuations (in whole or in
part) and renewals of any of the foregoing, (c) all income, royalties, damages
and payments now or hereafter due and/or payable under any of the foregoing or
with respect to any of the foregoing, including, without limitation, damages or
payments for past, present or future infringements of any of the foregoing, (d)
the right to sue for past, present and future infringements of any of the
foregoing and (e) all rights corresponding to any of the foregoing (including
the goodwill) throughout the world.




"Trademark License"
means any agreement now or hereafter in existence, whether written or oral,
providing for the grant by or to any Grantor of any right to use any Trademark,
including, without limitation, any of the foregoing referred to in Schedule
3.11.





"Vehicles" means all
cars, trucks, trailers, construction and earth moving equipment and other
vehicles covered by a certificate of title under the laws of any state, all
tires and all other appurtenances to any of the foregoing.





SECTION
1.3                                           Other Definitional
Provisions. Terms defined in the Credit Agreement and not otherwise
defined herein shall have the meaning assigned thereto in the Credit Agreement.
With reference to this Agreement and each other Loan Document, unless otherwise
specified herein or in such other Loan Document: (a) the definitions of terms
herein shall apply equally to the singular and plural forms of the terms
defined, (b) whenever the context may require, any pronoun shall include the
corresponding masculine, feminine and neuter forms, (c) the words "include",
"includes" and "including" shall be deemed to be followed by the phrase "without
limitation", (d) the word "will" shall be construed to have the same meaning and
effect as the word "shall", (e) any definition of or reference to any agreement,
instrument or other document herein shall be construed as referring to such
agreement, instrument or other document, as from time to time amended,
supplemented or otherwise modified (subject to any restrictions on such
amendments, supplements or modifications set forth herein), (f) any reference
herein to any Person shall be construed to include such Person's permitted
successors and assigns, (g) the words "herein", "hereof' and "hereunder", and
words of similar import, shall be construed to refer to this Agreement in its
entirety and not to any particular provision hereof, (h) all references herein
to Articles, Sections, Exhibits and Schedules shall be construed to refer to
Articles and Sections of, and Exhibits and Schedules to, this Agreement, (i) the
words "asset" and "property" shall be construed to have the same meaning and
effect and to refer to any and all tangible and intangible assets and
properties, including cash, securities, accounts and contract rights, (j) the
term "documents" includes any and all instruments, documents, agreements,
certificates, notices, reports, financial statements and other writings, however
evidenced, whether in physical or electronic form, (k) in the computation of
periods of time from a specified date to a later specified date, the word "from"
means "from and including;" the words "to" and "until" each mean "to but
excluding;" and the word "through" means "to and including", (1) Section
headings herein and in the other Loan Documents are included for convenience of
reference only and shall not affect the interpretation of this Agreement or any
other Loan Document and (m) where the context requires, terms relating to the
Collateral or any part thereof, when used in relation to a Grantor, shall refer
to such Grantor's Collateral or the relevant part thereof.





ARTICLE
II





SECURITY
INTEREST





SECTION
2.1                                           Grant of Security
Interest.  Each Grantor hereby grants, pledges and collaterally
assigns to the Administrative Agent, for the ratable benefit of itself and the
Secured Parties, a security interest in, all of such Grantor's right, title and
interest in the following property, now owned or at any time hereafter acquired
by such Grantor or in which such Grantor now has or at any time in the future
may acquire any right, title or interest, and wherever located or deemed located
(collectively, the "Collateral"), as
collateral security for the prompt and complete payment and performance when due
(whether at the stated maturity, by acceleration or otherwise) of the
Obligations:





(a)           all
Accounts;





(b)           all
cash and currency;





(c)           all
Chattel Paper;





(d)           all
Commercial Tort Claims identified on Schedule
3.9;









(f)            all
Documents;





(g)           all
Equipment;





(h)           all
Fixtures;





(i)            all
General Intangibles;




(j)           
all Instruments;





(k)           all
Intellectual Property;





(l)           
all Inventory;





(m)          all
Investment Property;





(n)           all
Letter of Credit Rights;





(o)           all
Vehicles;





(p)           all
other personal property not otherwise described above;





(q)           all
books and records pertaining to the Collateral; and




(r)           
to the extent not otherwise included, all Proceeds and products of any and all
of the foregoing and all collateral security and Supporting Obligations (as now
or hereafter defined in the UCC) given by any Person with respect to any of the
foregoing.





provided,
that (i) any Security Interest on any Capital Stock or other ownership interests
issued by any Foreign Subsidiary shall be limited to 65% of all issued and
outstanding shares of all classes of Capital Stock of such Foreign Subsidiary,
(ii) the Security Interests granted herein shall not extend to, and the term
"Collateral" shall not include, any rights under any lease, contract or
agreement (including, without limitation, any license for Intellectual Property)
to the extent that the granting of a security interest therein is specifically
prohibited in writing by, or would constitute an event of default under or would
grant a party a termination right under any agreement governing such right
unless such prohibition is not enforceable or is otherwise ineffective under
Applicable Law. Notwithstanding any of the foregoing, such proviso shall not
affect, limit, restrict or impair grant by any Grantor of a Security Interest in
any Account or any money or other amounts due and payable to any Grantor or to
become due and payable to any Grantor under such lease, contract or
agreement.





Notwithstanding the foregoing clause
(a) of this Section
2.1, the payment and performance of the Obligations shall not be secured
by any Hedging Agreement between any Grantor and the Administrative Agent or any
Lender or any Affiliate of the Administrative Agent or any Lender.





SECTION
2.2                                           Partnership/LLC
Interests.





(a)           Notwithstanding
anything to the contrary contained in any limited liability agreement, operating
agreement, membership agreement, partnership agreement or similar agreement
relating to any Partnership/LLC Interests (as amended, restated, supplemented or
otherwise modified from time to time, a "Partnership/LLC Agreement"), each
member, manager and partner shall be entitled to pledge its Partnership/LLC
Interests to and grant and collaterally assign to the Secured Parties a lien and
security interest in its Partnership/LLC Interests without any further consent,
approval or action by any other party, including, without limitation, any other
party to any Partnership/LLC Agreement or otherwise.





(b)           Upon
the occurrence and during the continuance of an Event of Default, the Secured
Parties or their respective designees shall have the right (but not the
obligation) to be substituted for the applicable Grantor as a member, manager or
partner under the applicable Partnership/LLC Agreement and the Secured Parties
shall have all rights, powers and benefits as a member, manager or partner, as
applicable, under such Partnership LLC Agreement. For avoidance of doubt, such
rights, powers and benefits of a substituted member shall include all voting and
other rights and not merely the rights of an economic interest holder. So long
as this Agreement remains in effect, no further consent, approval or action by
any other party including, without limitation, any other party to the
Partnership/LLC Agreement or otherwise shall be necessary to permit the Secured
Parties to be substituted as a member, manager or partner pursuant to this
paragraph. The rights, powers and benefits granted pursuant to this paragraph
shall inure to the benefit of the Secured Parties and their respective
successors, assigns and designated agents, as intended third party
beneficiaries.





The provisions of this Section 2.2 shall be
deemed to be an amendment to the terms of the applicable Partnership
LLC/Agreement of each applicable Grantor and each Grantor agrees that so long as
this Agreement remains in effect, such Partnership/LLC Agreement shall not be
amended to modify the provisions of this Section 2.2 without
the prior written consent of the Administrative Agent.





SECTION
2.3                                           Grantors Remain
Liable. Anything herein to the contrary notwithstanding: (a) each Grantor
shall remain liable to perform all of its duties and obligations under the
contracts and agreements included in the Collateral to the same extent as if
this Agreement had not been executed, (b) the exercise by the Administrative
Agent of any of the rights hereunder shall not release any Grantor from any of
its duties or obligations under the contracts and agreements included in the
Collateral, (c) neither the Administrative Agent nor any Lender shall have any
obligation or liability under the contracts and agreements included in the
Collateral by reason of this Agreement, nor shall the Administrative Agent or
any Lender be obligated to perform any of the obligations or duties of any
Grantor thereunder or to take any action to collect or enforce any claim for
payment assigned hereunder, and (d) neither the Administrative Agent nor any
Lender shall have any liability in contract or tort for any Grantor's acts or
omissions.





ARTICLE
III





REPRESENTATIONS AND
WARRANTIES





To induce the Administrative Agent and
the Secured Parties to enter into the Credit Agreement and to induce the Secured
Parties to make their respective Extensions of Credit to the Borrower
thereunder, each Grantor hereby represents and warrants to the Administrative
Agent and each Lender that:





SECTION
3.1                                           Existence. Each
Grantor is duly organized, validly existing and in good standing under the laws
of the jurisdiction of its incorporation or formation, has the requisite power
and authority to own, lease and operate its properties and to carry on its
business as now being and hereafter proposed to be conducted and is duly
qualified and authorized to do business in each jurisdiction in which the
character of its properties or the nature of its business requires such
qualification and authorization except in jurisdictions where the failure to be
so qualified or in good standing could not reasonably be expected to have a
Material Adverse Effect.





SECTION
3.2                                           Authorization of Agreement;
No Conflict. Each Grantor has the right, power and authority and has
taken all necessary corporate and other action to authorize the execution,
delivery and performance of, this Agreement. This Agreement has been duly
executed and delivered by the duly authorized officers of each Grantor and this
Agreement constitutes the legal, valid and binding obligation of the Grantors
enforceable in accordance with its terms, except as such enforcement may be
limited by bankruptcy, insolvency, reorganization, moratorium or similar state
or federal debtor relief laws from time to time in effect which affect the
enforcement of creditors' rights in general and the availability of equitable
remedies. The execution, delivery and performance by the Grantors of this
Agreement will not, by the passage of time, the giving of notice or otherwise,
violate any material provision of any Applicable Law or Material Contract and
will not result in the creation or imposition of any Lien, other than the
Security Interests, upon or with respect to any property or revenues of any
Grantor.





SECTION
3.3                                           Consents. No
approval, consent, exemption, authorization or other action by, or notice to, or
filing with, any Governmental Authority or any other Person is necessary or
required in connection with the execution, delivery or performance by, or
enforcement against any Grantor or any Issuer of this Agreement, except (a) as
may be required by laws affecting the offering and sale of securities generally,
(b) filings with the United States Copyright Office and/or the United States
Patent and Trademark Office, (c) filings under the UCC and/or the Assignment of
Claims Act and (d) as may be required with respect to Vehicles represented by a
certificate of title.





SECTION
3.4                                           Perfected First Priority
Liens. Each financing statement naming any Grantor as a debtor is in
appropriate form for filing in the appropriate filing offices of the states
specified on Schedule
3.6. The Security Interests granted pursuant to this Agreement (a)
constitute valid security interests in all of the Collateral in favor of the
Administrative Agent, for the ratable benefit of itself and the Secured Parties,
as collateral security for the Obligations, and (b): (1) when UCC financing
statements containing an adequate description of the Collateral shall have been
filed in the offices specified in Schedule 3.6, the
Security Interests will constitute perfected security interests in all right,
title and interest of such Grantor in the Collateral to the extent that a
security interest therein may be perfected by filing pursuant to the UCC, prior
to all other Liens and rights of others therein except for Permitted Liens; (2)
when each Copyright security agreement has been filed with the United States
Copyright Office, the Security Interests will constitute perfected security
interests in all right, title and interest of such Grantor in the Intellectual
Property therein described, prior to all other Liens and rights of others
therein except for Permitted Liens; and (3) when each control agreement has been
executed and delivered to the Administrative Agent, the Security Interests will
constitute perfected security interests in all right, title and interest of the
Grantors in the Deposit Accounts and Securities Accounts, as applicable, subject
thereto, prior to all other Liens and rights of others therein and subject to no
adverse claims except for Permitted Liens.





SECTION
3.5                                           Title, No Other
Liens. Except for the Security Interests, each Grantor owns each item of
the Collateral free and clear of any and all Liens or claims other than
Permitted Liens. No financing statement under the UCC of any state which names a
Grantor as debtor or other public notice with respect to all or any part of the
Collateral is on file or of record in any public office, except such as have
been filed in favor of the Administrative Agent, for the ratable benefit of
itself and the Secured Parties, pursuant to this Agreement or in connection with
Permitted Liens. No Collateral is in the possession or Control of any Person
asserting any claim thereto or security interest therein, except that (a) the
Administrative Agent or its designee may have possession or Control of
Collateral as contemplated hereby, (b) a depositary bank may have Control of a
Deposit Account owned by a Grantor at such depositary bank and a Securities
Intermediary may have Control over a Securities Account owned by a Grantor at
such Securities Intermediary, in each case subject to the terms of any Deposit
Account control agreement or Securities Account control agreement, as applicable
and to the extent required by Article IV, in favor of the Administrative Agent,
and (c) a bailee, consignee or other Person may have possession of the
Collateral as contemplated by, and so long as, the applicable Grantors have
complied to the satisfaction of the Administrative Agent with the applicable
provisions of Section
4.6(c).





SECTION
3.6                                           State of Organization;
Location of Inventory, Equipment and Fixtures; other
Information.





(a)           The
exact legal name of each Grantor is set forth on Schedule 3.6 (as such
schedule may be updated from time to time pursuant to Section
4.3).





(b)           Each
Grantor is a Registered Organization organized under the laws of the state
identified on Schedule
3.6 under such Grantor's name (as such schedule may be updated from time
to time pursuant to Section 4.3). The
taxpayer identification number and Registered Organization number of each
Grantor is set forth on Schedule 3.6 under
such Grantor's name (as such schedule may be updated from time to time pursuant
to Section
4.3).





(c)           All
Collateral consisting of Inventory, Equipment and Fixtures (whether now owned or
hereafter acquired) is (or will be) located at the locations specified on Schedule 3.6, except
as otherwise permitted hereunder.




(d)           The
mailing address, chief place of business, chief executive office and office
where each Grantor keeps its books and records relating to the Accounts,
Documents, General Intangibles, Instruments and Investment Property in which it
has any interest is located at the locations specified on Schedule 3.6 under
such Grantor's name. No Grantor has any other places of business except those
separately set forth on Schedule 3.6 under
such Grantor's name. No Grantor does business nor has done business during the
past five years under any trade name or fictitious business name except as
disclosed on Schedule
3.6 under such Grantor's name. Except as disclosed on Schedule 3.6 under
such Grantor's name, no Grantor has acquired assets from any Person, other than
assets acquired in the ordinary course of such Grantor's business, during the
past five years.





SECTION
3.7                                           Accounts.




(a)           Each
existing Account constitutes, and each hereafter arising Account will
constitute, the legally valid and binding obligation of the applicable Account
Debtor. The amount represented by each Grantor to the Administrative Agent as
owing by each Account Debtor is, or will be, the correct amount actually and
unconditionally owing, except for ordinary course cash discounts and allowances
where applicable. No Account Debtor has any defense, set-off, claim or
counterclaim against any Grantor that can be asserted against the Administrative
Agent, whether in any proceeding to enforce the Administrative Agent's rights in
the Collateral or otherwise except defenses, setoffs, claims or counterclaims
that would not, in the aggregate, have a Material Adverse Effect on the value of
the Accounts. None of the Accounts is, nor will any hereafter arising Account
be, evidenced by a promissory note or other Instrument (other than a check) that
has not been pledged to the Administrative Agent in accordance with the terms
hereof.





(b)           Schedule 3.7 sets
forth a complete and accurate list of all Government Contracts of the Grantors
in effect as of the Closing Date. As of the Closing Date, except as set forth in
Schedule 3.7,
each such Government Contract is, and after giving effect to the consummation of
the transactions contemplated by .the Loan Documents will be, in full force and
effect in accordance with the terms thereof. Neither the Borrower nor any other
Grantor (nor, to the knowledge of any Grantor, any other party thereto) is in
breach of or in default under any Government Contract. No notice of any dispute,
holdback, claim of set-off or other claim, suspension, debarment, cure notice,
show cause notice or notice of termination for default has been issued by any
Governmental Authority to any Grantor, and neither the Borrower nor any other
Grantor is a party to any pending, or to the Borrower's or any Grantor's
knowledge, threatened dispute, holdback, claim of set-off or other claim,
suspension, debarment, or termination for default issued by any Governmental
Authority.





SECTION
3.8                                           Chattel Paper. As of
the date hereof, no Grantor holds any Chattel


Paper in
the ordinary course of its business.





SECTION
3.9                                           Commercial Tort
Claims. As of the date hereof, all Commercial Tort Claims owned by any
Grantor are listed on Schedule
3.9.




SECTION
3.10                                        Deposit Accounts. As
of the date hereof, all Deposit Accounts (including, without limitation, cash
management accounts that are Deposit Accounts), securities accounts and
lockboxes including the: (a) owner of the account, (b) name and address of
financial institution or securities broker where such accounts are located, (c)
account numbers and (d) purpose or use of such account owned by any Grantor are
listed on Schedule
3.10.





SECTION
3.11                                       
Intellectual
Property.





(a)           As
of the date hereof, all Copyright registrations, Copyright applications, issued
Patents, Patent applications, Trademark registrations and Trademark applications
owned by any Grantor in its own name on the date hereof is listed on Schedule 3.11 (as
such schedule may be updated from time to time pursuant to Section
4.3).





(b)           Except
as set forth in Schedule 3.11 on the
date hereof (as such schedule may be updated from time to time pursuant to Section 4.3), none of
the Intellectual Property owned by any Grantor is the subject of any written
licensing or franchise agreement pursuant to which such Grantor is the licensor
or franchisor, except as could not reasonably be expected to have a Material
Adverse Effect.




SECTION
3.12                                      
Inventory.
Collateral consisting of Inventory is of good and merchantable quality, free
from any material defects. To the knowledge of each Grantor, none of such
Inventory is subject to any licensing, Patent, Trademark, trade name or
Copyright with any Person that restricts any Grantor's ability to manufacture
and/or sell such Inventory. The completion of the manufacturing process of such
Inventory by a Person other than the applicable Grantor would be permitted under
any contract to which such Grantor is a party or to which the Inventory is
subject.





SECTION
3.13                                      
Investment Property;
Partnership/LLC Interests.





(a)           As
of the date hereof, all Investment Property (including, without limitation,
Securities Accounts and cash management accounts that are Investment Property)
and all Partnership/LLC Interests owned by any Grantor is listed on Schedule 3.13 (as
such schedule may be updated from time to time pursuant to Section
4.3).





(b)           All
Investment Property and all Partnership/LLC Interests issued by any Issuer to
any Grantor (i) have been duly and validly issued and, if applicable, are fully
paid and nonassessable, (ii) are beneficially owned as of record by such Grantor
and (iii) constitute all the issued and outstanding shares of all classes of the
capital stock of such Issuer issued to such Grantor.




(c)           None
of the Partnership/LLC Interests (i) are traded on a Securities exchange or in
Securities markets, (ii) by their terms expressly provide that they are
Securities governed by Article 8 of the UCC, (iii) are Investment Company
Securities or (iv) are held in a Securities Account.





SECTION
3.14                                        
Instruments. As
of the date hereof, no Grantor holds any Instruments or is named a payee of any
promissory note or other evidence of indebtedness.





ARTICLE
IV





COVENANTS





Until the Obligations shall have been
paid in full and the Commitments terminated, unless consent has been obtained in
the manner provided for in Section 7.1, each
Grantor covenants and agrees that:





SECTION
4.1                                           Maintenance of Perfected
Security Interest: Further Information.




(a)           Each
Grantor shall maintain the Security Interest created by this Agreement as a
first priority perfected Security Interest (other than Permitted Liens) and
shall defend such Security Interest against the claims and demands of all
Persons whomsoever (other than Permitted Liens).





(b)           Each
Grantor will furnish to the Administrative Agent upon the Agent's reasonable
request and the Secured Parties from time to time statements and schedules
further identifying and describing the assets and property of such Grantor and
such other reports in connection therewith as the Administrative Agent may
reasonably request, all in reasonable detail.




SECTION
4.2                                           Maintenance of
Insurance.




(a)           Each
Grantor will maintain, with financially sound and reputable companies, insurance
policies (i) insuring the Collateral against loss by fire, explosion, theft,
fraud and such other casualties, including business interruption, as may be
reasonably satisfactory to the Administrative Agent in amounts and with
deductibles at least as favorable as those generally maintained by businesses of
similar size engaged in similar activities and (ii) insuring such motor and the
Administrative Agent, for the ratable benefit of the Secured Parties, against
liability for hazards, risks and liability to persons and property relating to
the Collateral, in amounts and with deductibles at least as favorable as those
generally maintained by businesses of similar size engaged in similar
activities, such policies to be in such form and having such coverage as may be
reasonably satisfactory to the Administrative Agent and the Secured
Parties.





(b)           All
insurance referred to in subsection (a) above shall (i) name the Administrative
Agent for the ratable benefit of itself and the Secured Parties as loss payee
(to the extent covering risk of loss or damage to tangible property) and as an
additional insured as its interests may appear (to the extent covering any other
risk), (ii) provide that no cancellation, material reduction in amount or
material change in coverage thereof shall be effective until at least thirty
(30) days after receipt by the Administrative Agent of written notice thereof
and (iii) be reasonably satisfactory in all other respects to the Administrative
Agent.





(c)           Upon
the request of the Administrative Agent from time to time, each Grantor shall
deliver to the Administrative Agent and the Secured Parties periodic information
from a reputable insurance broker with respect to the insurance referred to in
this Section
4.2.





SECTION
4.3                                           Changes in Locations;
Changes in Name or Structure. No Grantor will, except upon thirty (30)
days' prior written notice to the Administrative Agent and delivery to the
Administrative Agent of (a) all additional financing statements (executed if
necessary for any particular filing jurisdiction) and other instruments and
documents reasonably requested by the Administrative Agent to maintain the
validity, perfection and priority of the Security Interests and (b) if
applicable, a written supplement to the Schedules of this
Agreement:





(i)           permit
any Deposit Account (other than Excluded Deposit Accounts) to be held by or at a
depositary bank other than the depositary bank that held such Deposit Account as
of the date hereof as set forth on Schedule
3.10;





(ii)           permit
any of the Inventory, Equipment or Fixtures to be kept at a. location other than
those listed on Schedule 3.6, except
as otherwise permitted hereunder;





(iii)           permit
any Investment Property (other than Certificated Securities delivered to the
Administrative Agent pursuant to Section 4.5) to be
held by a Securities Intermediary other than the Securities Intermediary that
held such Investment Property as of the date hereof as set forth on Schedule
3.13;





(iv)           change
its jurisdiction of organization or the location of its chief executive office
from that identified on Schedule 3.6;
or





(v)           change
its name, identity or corporate or organizational structure to such an extent
that any financing statement filed by the Administrative Agent in connection
with this Agreement would become misleading.





SECTION
4.4                                           Required
Notifications. Each Grantor shall promptly notify the Administrative
Agent, in writing, of: (a) any Lien (other than the Security Interests or
Permitted Liens) on any of the Collateral which would adversely affect the
ability of the Administrative Agent to exercise any of its remedies hereunder,
(b) the occurrence of any other event which could reasonably be expected to have
a Material Adverse Effect on the aggregate value of the Collateral or on the
Security Interests, (c) any Collateral which, to the knowledge of such Grantor,
constitutes a Material Government Contract, and (d) the acquisition or ownership
by such Grantor of any (i) Commercial Tort Claim, (ii) Deposit Account (other
than Excluded Deposit Accounts), (iii) Investment Property after the date
hereof, or (iv) the occurrence of any material dispute, holdback, claim of
set-off or other claim by the applicable Governmental Authority under any
Material Government Contract or receipt by any Grantor of any notice of material
suspension, debarment, cure notice, show cause notice or notice of termination
for default issued by any Governmental Authority to any Grantor.




SECTION
4.5                                           Delivery Covenants.
Each Grantor will deliver and pledge to the Administrative Agent, for the
ratable benefit of itself and the Secured Parties, all Certificated Securities,
Partnership/LLC Interests evidenced by a certificate, negotiable Documents,
Instruments, and Tangible Chattel Paper owned or held by such Grantor, in each
case, together with an Effective Endorsement and Assignment and all Supporting
Obligations, as applicable, unless such delivery and pledge has been waived in
writing by the Administrative Agent.





SECTION
4.6                                           Control
Covenants.





(a)           Each
Grantor shall instruct (and otherwise use its commercially reasonable efforts)
to cause (i) each depositary bank (other than the Administrative Agent) holding
a Deposit Account (other than Excluded Deposit Accounts) owned by such Grantor
and (ii) each Securities Intermediary holding any Investment Property (other
than an Excluded Securities Account) owned by such Grantor, to execute and
deliver a control agreement, sufficient to provide the Administrative Agent with
Control of such Deposit Account or Investment Property and otherwise in form and
substance satisfactory to the Administrative Agent (any such depositary bank
executing and delivering any such control agreement, a "Controlled
Depositary", and any such Securities Intermediary executing and
delivering any such control agreement, a "Controlled
Intermediary"). In the event any such depositary bank or Securities
Intermediary refuses to execute and deliver such control agreement, the
Administrative Agent, in its sole discretion, may require the applicable Deposit
Account or Investment Property to be transferred to the Administrative Agent or
a Controlled Depositary or Controlled Intermediary, as applicable. After the
date hereof, all Deposit Accounts (other than Excluded Deposit Accounts) and all
Investment Property will be maintained with the Administrative Agent or with a
Controlled Depository or a Controlled Intermediary, as applicable.





(b)           Each
Grantor will take such actions and deliver all such agreements as are requested
by the Administrative Agent to provide the Administrative Agent with Control of
all Letter of Credit Rights and Electronic Chattel Paper owned or held by such
Grantor, including, without limitation, with respect to any such Electronic
Chattel Paper, by having the Administrative Agent identified as the assignee of
the Record(s) pertaining to the single authoritative copy thereof.




(c)           If
any Collateral (other than Collateral specifically subject to the provisions of
Section 4.6(a)
and Section
4.6(b)) exceeding in value $500,000 in the aggregate (such Collateral
exceeding such amount, the "Excess Collateral")
is at any time in the possession or control of any consignee, warehouseman,
bailee (other than a carrier transporting Inventory to a purchaser in the
ordinary course of business), processor, or any other third party, such Grantor
shall notify in writing such Person of the Security Interests created hereby,
shall use its commercially reasonable efforts to obtain such Person's written
agreement in writing to hold all such Collateral for the Administrative Agent's
account subject to the Administrative Agent's instructions, and shall cause such
Person to issue and deliver to the Administrative Agent warehouse receipts,
bills of lading or any similar documents relating to such Collateral to the
Administrative Agent's Office together with an Effective Endorsement and
Assignment; provided that if such
Grantor is not able to obtain such agreement and cause the delivery of such
items, the Administrative Agent, in its sole discretion, may require such Excess
Collateral to be moved to another location specified thereby. Further, each
Grantor shall perfect and protect such Grantor's ownership interests in all
Inventory stored with a consignee against creditors of the consignee by filing
and maintaining financing statements against the consignee reflecting the
consignment arrangement filed in all appropriate filing offices, providing any
written notices required to notify any prior creditors of the consignee of the
consignment arrangement, and taking such other actions as may be appropriate to
perfect and protect such Grantor's interests in such inventory under Section
2-326, Section 9-103, Section 9-324 and Section 9-505 of the UCC or otherwise.
All such financing statements filed pursuant to this Section 4.6(c) shall
be assigned, on the face thereof, to the Administrative Agent, for the ratable
benefit of itself and the other Secured Parties.




SECTION
4.7                                           Filing Covenants.
Pursuant to Section 9-509 of the UCC and any other Applicable Law, each Grantor
authorizes the Administrative Agent to file or record financing statements and
other filing or recording documents or instruments with respect to the
Collateral without the signature of such Grantor in such form and in such
offices as the Administrative Agent determines appropriate to perfect the
Security Interests of the Administrative Agent under this Agreement. Such
financing statements may describe the Collateral in the same manner as described
herein or may contain an indication or description of Collateral that describes
such property in any other manner as the Administrative Agent may determine, in
its sole discretion, is necessary, advisable or prudent to ensure the perfection
of the Security Interest in the Collateral granted herein, including, without
limitation, describing such property as "all assets" or "all personal property."
Further, a photographic or other reproduction of this Agreement shall be
sufficient as a financing statement or other filing or recording document or
instrument for filing or recording in any jurisdiction. Grantor hereby
authorizes, ratifies and confirms all financing statements and other filing or
recording documents or instruments filed by the Administrative Agent prior to
the date of this Agreement.





SECTION
4.8                                           Accounts.




(a)           Other
than in the ordinary course of business consistent with its past practice, no
Grantor will (i) grant any extension of the time of payment of any Account, (ii)
compromise or settle any Account for less than the full amount thereof, (iii)
release, wholly or partially, any Account Debtor, (iv) allow any credit or
discount whatsoever on any Account or (v) amend, supplement or modify any
Account in any manner that could reasonably be likely to adversely affect the
value thereof.





(b)           Each
Grantor will deliver to the Administrative Agent a copy of each material demand,
notice or document received by it that questions or calls into doubt the
validity or enforceability of any material Account.





(c)           The
Administrative Agent shall have the right to make test verifications of the
Accounts in any manner and through any medium that it reasonably considers
advisable, and each Grantor shall furnish all such assistance and information as
the Administrative Agent may require in connection with such test verifications.
At any time and from time to time, upon the Administrative Agent's request and
at the expense of the relevant Grantor, such Grantor shall cause independent
public accountants or others satisfactory to the Administrative Agent to furnish
to the Administrative Agent reports showing reconciliations, aging and test
verifications of, and trial balances for, the Accounts.





SECTION
4.9                                           Intellectual
Property.





(a)           Except
as could not reasonably be expected to have a Material Adverse Effect, each
Grantor (either itself or through licensees) (i) will use each registered
Trademark (owned by such Grantor) and Trademark for which an application (owned
by such Grantor) is pending, to the extent reasonably necessary to maintain such
Trademark in full force free from any claim of abandonment for non-use, (ii)
will maintain products and services offered under such Trademark at a level
substantially consistent with the quality of such products and services as of
the date hereof, (iii) will not (and will not permit any licensee or sublicensee
thereof to) do any act or knowingly omit to do any act whereby such Trademark
could reasonably be expected to become invalidated or impaired in any way, (iv)
will not do any act, or knowingly omit to do any act, whereby any issued Patent
owned by such Grantor would reasonably be expected to become forfeited,
abandoned or dedicated to the public, (v) will not (and will not permit any
licensee or sublicensee thereof to) do any act or knowingly omit to do any act
whereby any registered Copyright owned by such Grantor or Copyright for which an
application is pending (owned by such Grantor) could reasonably be expected to
become invalidated or otherwise impaired and (vi) will not (either itself or
through licensees) do any act whereby any material portion of the Copyrights may
fall into the public domain.





(b)           Each
Grantor will notify the Administrative Agent and the Secured Parties promptly if
it knows, or has reason to know, that any application or registration relating
to any material Intellectual Property owned by such Grantor may become
forfeited, abandoned or dedicated to the public, or of any adverse determination
or development (including, without limitation, the institution of, or any such
determination or development in, any proceeding in the United States Patent and
Trademark Office, the United States Copyright Office or any court or tribunal in
any country) regarding such Grantor's ownership of, or the validity of, any
material Intellectual Property owned by such Grantor or such Grantor's right to
register the same or to own and maintain the same.





(c)           Whenever
such Grantor, either by itself or through any agent, employee, licensee or
designee, shall file an application for the registration of any Intellectual
Property with the United States Patent and Trademark Office, the United States
Copyright Office or any similar office or agency in any other country or any
political subdivision thereof, such Grantor shall report such filing to the
Administrative Agent within five (5) Business Days after the last day of the
fiscal quarter in which such filing occurs. Upon request of the Administrative
Agent, such Grantor shall execute and deliver, and have recorded, any and all
agreements, instruments, documents, and papers as the Administrative Agent may
reasonably request to evidence the Administrative Agent's and the Secured
Parties' security interest in any material Copyright, Patent or Trademark and
the goodwill and General Intangibles of such Grantor relating thereto or
represented thereby.




(d)           Each
Grantor will take all reasonable and necessary steps, at such Grantor's sole
cost and expense, including, without limitation, in any proceeding before the
United States Patent and Trademark Office, the United States Copyright Office or
any similar office or agency in any other country or any political subdivision
thereof, to maintain and pursue each application (and to obtain the relevant
registration) and to maintain each registration of the material Intellectual
Property, including, without limitation, filing of applications for renewal,
affidavits of use and affidavits of incontestability.





(e)           In
the event that any material Intellectual Property owned by a Grantor is
infringed, misappropriated or diluted by a third party, the applicable Grantor
shall (i) at such Grantor's sole cost and expense, take such actions as such
Grantor shall reasonably deem appropriate under the circumstances to protect
such Intellectual Property and (ii) if such Intellectual Property is of material
economic value, promptly notify the Administrative Agent after it learns of such
infringement, misappropriation or dilution.





SECTION
4.10                                Investment Property;
Partnership/LLC Interests.





(a)           Without
the prior written consent of the Administrative Agent, no Grantor will (i) vote
to enable, or take any other action to permit, any applicable Issuer to issue
any Investment Property or Partnership/LLC Interests, except for such additional
Investment Property or Partnership/LLC Interests that will be subject to the
Security Interest granted herein in favor of the Administrative Agent, or (ii)
enter into any agreement or undertaking restricting the right or ability of such
Grantor or the Administrative Agent to sell, assign or transfer any Investment
Property or Partnership/LLC Interests or Proceeds thereof. The Grantors will
defend the right, title and interest of the Administrative Agent in and to any
Investment Property and Partnership/LLC Interests against the claims and demands
of all Persons whomsoever.





(b)           If
any Grantor shall become entitled to receive or shall receive (i) any
Certificated Securities (including, without limitation, any certificate
representing a stock dividend or a distribution in connection with any
reclassification, increase or reduction of capital or any certificate issued in
connection with any reorganization), option or rights in respect of the
ownership interests of any Issuer, whether in addition to, in substitution of,
as a conversion of, or in exchange for, any Investment Property, or otherwise in
respect thereof, or (ii) any sums paid upon or in respect of any Investment
Property upon the liquidation or dissolution of any Issuer, such Grantor shall
accept the same as the agent of the Administrative Agent and the Secured
Parties, hold the same in trust for the Administrative Agent and the Secured
Parties, segregated from other funds of such Grantor, and promptly deliver the
same to the Administrative Agent in accordance with the terms
hereof.




SECTION
4.11                                Equipment. Each
Grantor will maintain each item of Equipment in good working order and condition
(reasonable wear and tear and obsolescence excepted), and generally in
accordance with any manufacturer's manual, and will as quickly as practicable
provide all maintenance, service and repairs necessary for such purpose and will
promptly furnish to the Administrative Agent a statement respecting any material
loss or damage to any of the Equipment.





SECTION
4.12                                Vehicles. Upon the
request of the Administrative Agent upon the occurrence and during the
continuance of an Event of Default, all applications for certificates of title
or ownership indicating the Administrative Agent's first priority Lien on the
Vehicle (subject to any Permitted Liens) covered by such certificate, and any
other necessary documentation, shall be filed in each office in each
jurisdiction which the Administrative Agent shall deem reasonably advisable to
perfect its Liens on the Vehicles; provided that with respect to Vehicles
subject to Permitted Liens, no such application or other documentation shall be
required. Prior thereto, each certificate of title or ownership relating to each
Vehicle shall be maintained by the applicable Grantor in accordance with
Applicable Law to reflect the ownership interest of such Grantor.





SECTION
4.13                                Further Assurances;
Government Contracts. Upon the request of the Administrative Agent and at
the sole expense of the Grantors, each Grantor will promptly and duly execute
and deliver, and have recorded, such further instruments and documents and take
such further actions as the Administrative Agent may reasonably request for the
purpose of obtaining or preserving the full benefits of this Agreement and of
the rights and powers herein granted, including, without limitation, (i) the
assignment of any Material Contract, (ii) with respect to each Material
Government Contract, Assignment Agreements and Notices of Assignment, in form
and substance the same as that set forth on Exhibit A-1 and Exhibit A-2,
respectively, duly executed by any Grantors party to such Government Contract in
compliance with the Assignment of Claims Act (or analogous state Applicable Law)
and acknowledged in writing by the appropriate Governmental Authority, and (iii)
all applications, certificates, instruments, registration statements, and all
other documents and papers the Administrative Agent may reasonably request and
as may be required by law in connection with the obtaining of any consent,
approval, registration, qualification, or authorization of any Person deemed
necessary or appropriate for the effective exercise of any rights under this
Agreement.




ARTICLE
V





REMEDIAL
PROVISIONS




SECTION
5.1                                           General Remedies. If
an Event of Default shall occur and be continuing, the Administrative Agent, on
behalf of the Secured Parties, may exercise, in addition to all other rights and
remedies granted to them in this Agreement and in any other instrument or
agreement securing, evidencing or relating to the Obligations, all rights and
remedies of a secured party under the UCC or any other Applicable Law. Without
limiting the generality of the foregoing, the Administrative Agent, without
demand of performance or other demand, presentment, protest, advertisement or
notice of any kind (except any notice required by law referred to below) to or
upon any Grantor or any other Person (all and each of which demands, defenses,
advertisements and notices are hereby waived), may in such circumstances
forthwith collect, receive, appropriate and realize upon the Collateral, or any
part thereof, and/or may forthwith sell, lease, assign, give option or options
to purchase, or otherwise dispose of and deliver the Collateral or any part
thereof (or contract to do any of the foregoing), in one or more parcels at
public or private sale or sales, at any exchange, broker's board or office of
the Administrative Agent or any Lender or elsewhere upon such terms and
conditions as it may deem advisable and at such prices as it may deem best, for
cash .or on credit or for future delivery without assumption of any credit risk.
The Administrative Agent may disclaim any warranties in connection with any sale
or other disposition of the Collateral, including, without limitation, any
warranties of title, possession, quiet enjoyment and the like. The
Administrative Agent or any Lender shall have the right upon any such public
sale or sales, and, to the extent permitted by law, upon any such private sale
or sales, to purchase the whole or any part of the Collateral so sold, free of
any right or equity of redemption in any Grantor, which right or equity is
hereby waived and released. Each Grantor further agrees, at the Administrative
Agent's request, to assemble the Collateral and make it available to the
Administrative Agent at places which the Administrative Agent shall reasonably
select, whether at such Grantor's premises or elsewhere. To the extent permitted
by Applicable Law, each Grantor waives all claims, damages and demands it may
acquire against the Administrative Agent or any Lender arising out of the
exercise by them of any rights hereunder except to the extent any such claims,
damages, or demands result solely from the gross negligence or willful
misconduct of the Administrative Agent or any Lender, in each case against whom
such claim is asserted. If any notice of a proposed sale or other disposition of
Collateral shall be required by law, such notice shall be deemed reasonable and
proper if given at least ten (10) days before such sale or other
disposition.





SECTION
5.2                                           Specific
Remedies.





(a)           The
Administrative Agent hereby authorizes each Grantor to collect such Grantor's
Accounts, under the Administrative Agent's direction and control; provided that, the
Administrative Agent may curtail or terminate such authority at any time after
the occurrence and during the continuance of an Event of Default.





(b)           Upon
the occurrence and during the continuance of an Event of Default:




(i)
              the
      Administrative Agent may communicate with Account Debtors of any Account
      subject to a Security Interest and upon the request of the Administrative
      Agent, each Grantor shall notify (such notice to be in form and substance
      satisfactory to the Administrative Agent) its Account Debtors and parties
      to the Material Contracts subject to a Security Interest that such
      Accounts and the Material Contracts have been assigned to the
      Administrative Agent, for the ratable benefit of itself and the Secured
      Parties;





(ii)
              each
      Grantor shall forward to the Administrative Agent, on the last Business
      Day of each week, deposit slips related to all cash, money, checks or any
      other similar items of payment received by the Grantor during such week,
      and, if requested by the Administrative Agent, copies of such checks or
      any other similar items of payment, together with a statement showing the
      application of all payments on the Collateral during such week and a
      collection report with regard thereto, in form and substance satisfactory
      to the Administrative Agent;





(iii)
              whenever
      any Grantor shall receive any cash, money, checks or any other similar
      items of payment relating to any Collateral (including any Proceeds of any
      Collateral), subject to the terms of any Permitted Liens, such Grantor
      agrees that it will, Within one (1) Business Day of such receipt, deposit
      all such items of payment into the Collateral Account or in a Deposit
      Account (other than an Excluded Deposit Account) at a Controlled
      Depositary, until such Grantor shall deposit such cash, money, checks or
      any other similar items of payment in the Collateral Account or in a
      Deposit Account (other than an Excluded Deposit Account) at a Controlled
      Depositary, such Grantor shall hold such cash, money, checks or any other
      similar items of payment in trust for the Administrative Agent and Secured
      Parties and as property of the Administrative Agent and Secured Parties,
      separate from the other funds of such Grantor, and . the Administrative
      Agent shall have the right in to transfer or direct the transfer of the
      balance of each Deposit Account to the Collateral Account. All such
      Collateral and Proceeds of Collateral received by the Administrative Agent
      hereunder shall be held by the Administrative Agent in the Collateral
      Account as collateral security for all the Obligations and shall not
      constitute payment thereof until applied as provided in Section
      5.4;





(iv)
              the
      Administrative Agent shall have the right to receive any and all cash
      dividends, payments or distributions made in respect of any Investment
      Property, or Partnership/LLC Interests or other Proceeds paid in respect
      of any Investment Property, or Partnership/LLC Interests, and any or all
      of any Investment Property, or Partnership/LLC Interests shall be
      registered in the name of the Administrative Agent or its nominee, and the
      Administrative Agent or its nominee may thereafter exercise (A) all
      voting, corporate and other rights pertaining to such Investment Property,
      or Partnership/LLC Interests at any meeting of shareholders, partners or
      members of the relevant Issuers and (B) any and all rights of conversion,
      exchange and subscription and any other rights, privileges or options
      pertaining to such Investment Property, or Partnership/LLC Interests as if
      it were the absolute owner thereof (including, without limitation, the
      right to exchange at its discretion any and all of the Investment
      Property; or Partnership/LLC Interests upon the merger, consolidation,
      reorganization, recapitalization or other fundamental change in the
      corporate, partnership or company structure of any Issuer or upon the
      exercise by any Grantor or the Administrative Agent of any right,
      privilege or option pertaining to such Investment Property, or
      Partnership/LLC Interests, and in connection therewith, the right to
      deposit and deliver any and all of the Investment Property, or
      Partnership/LLC Interests with any committee, depositary, transfer agent,
      registrar or other designated agency upon such terms and conditions as the
      Administrative Agent may determine), all without liability except to
      account for property actually received by it; but the Administrative Agent
      shall have no duty to any Grantor to exercise any such right, privilege or
      option and the Administrative Agent and the Secured Parties shall not be
      responsible for any failure to do so or delay in so doing. In furtherance
      thereof, each Grantor hereby authorizes and instructs each Issuer with
      respect to any Collateral consisting of Investment Property and
      Partnership/LLC Interests to (i) comply with any instruction received by
      it from the Administrative Agent in writing that (A) states that an Event
      of Default has occurred and is continuing and (B) is otherwise in
      accordance with the terms of this Agreement, without any other or further
      instructions from such Grantor, and each Grantor agrees that each Issuer
      shall be fully protected in so complying following receipt of such notice
      and prior to notice that such Event of Default is no longer continuing,
      and (ii) except as otherwise expressly permitted hereby, pay any
      dividends, distributions or other payments with respect to any Investment
      Property, or Partnership/LLC Interests directly to the Administrative
      Agent; and





(v)
              the
      Administrative Agent shall be entitled to (but shall not be required to):
      (A) proceed to perform any and all obligations of the applicable Grantor
      under any Material Contract and exercise all rights of such Grantor
      thereunder as fully as such Grantor itself could, (B) do all other acts
      which the Administrative Agent may deem necessary or proper to protect its
      Security Interest granted hereunder, provided such acts are not
      inconsistent with or in violation of the terms of any of the Credit
      Agreement, of the other Loan Documents or Applicable Law, and (C) sell,
      assign or otherwise transfer any Material Contract in accordance with the
      Credit Agreement, the other Loan Documents and Applicable Law, subject,
      however, to the prior approval of each other party to such Material
      Contract, to the extent required under the Material
    Contract.




(c)           Unless
an Event of Default shall have occurred and be continuing and the Administrative
Agent shall have given notice to the relevant Grantor of the Administrative
Agent's intent to exercise its corresponding rights pursuant to Section 5.2(b), each
Grantor shall be permitted to receive all cash dividends, payments or other
distributions made in respect of any Investment Property and Partnership/LLC
Interests, in each case paid in the normal course of business of the relevant
Issuer and consistent with past practice, to the extent permitted in the Credit
Agreement, and to exercise all voting and other corporate, company and
partnership rights with respect to any Investment Property and Partnership/LLC
Interests; provided that, no
vote shall be cast or other corporate, company and partnership right exercised
or other action taken which, in the Administrative Agent's reasonable judgment,
would impair the Collateral in any material respect or which would result in a
Default or Event of Default under any provision of the Credit Agreement, this
Agreement or any other Loan Document.




SECTION
5.3                                           Registration
Rights.




(a)           If
the Administrative Agent shall determine that in order to exercise its right to
sell any or all of the Collateral it is necessary or advisable to have such
Collateral registered under the provisions of the Securities Act (any such
Collateral, the "Restricted Securities
Collateral"), the relevant Grantor will cause each applicable Issuer (and
the officers and directors thereof) to (i) execute and deliver all such
instruments and documents, and do or cause to be done all such other acts as may
be, in the opinion of the Administrative Agent, necessary or advisable to
register such Restricted Securities Collateral, or that portion thereof to be
sold, under the provisions of the Securities Act, (ii) use its commercially
reasonable efforts to cause the registration statement relating thereto to
become effective and to remain effective for a period of one year from the date
of the first public offering of such Restricted Securities Collateral, or that
portion thereof to be sold, and (iii) make all amendments thereto and/or to the
related prospectus which, in the opinion of the Administrative Agent, are
necessary or advisable, all in conformity with the requirements of the
Securities Act and the rules and regulations of the Securities and Exchange
Commission applicable thereto. Each Grantor agrees to cause each applicable
Issuer (and the officers and directors thereof) to comply with the provisions of
the securities or "Blue Sky" laws of any and all jurisdictions which the
Administrative Agent shall designate and to make available to its security
holders, as soon as practicable, an earnings statement (which need not be
audited) which will satisfy the provisions of Section II (a) of the Securities
Act.





(b)           Each
Grantor recognizes that the Administrative Agent may be unable to effect a
public sale of any or all the Restricted Securities Collateral, by reason of
certain prohibitions contained in the Securities Act and applicable state
securities laws or otherwise, and may be compelled to resort to one or more
private sales thereof to a restricted group of purchasers which will be obliged
to agree, among other things, to acquire such securities for their own account
for investment and not with a view to the distribution or resale thereof. Each
Grantor acknowledges and agrees that any such private sale may result in prices
and other terms less favorable than if such sale were a public sale and,
notwithstanding such circumstances, agrees that any such private sale shall be
deemed to have been made in a commercially reasonable manner. The Administrative
Agent shall be under no obligation to delay a sale of any of the Restricted
Securities Collateral for the period of time necessary to permit the Issuer
thereof to register such securities for public sale under the Securities Act, or
under applicable state securities laws, even if such Issuer would agree to do
so.





(c)           Each
Grantor agrees to use its commercially reasonable efforts to do or cause to be
done all such other acts as may be necessary to make such sale or sales of all
or any portion of the Restricted Securities Collateral valid and binding and in
compliance with any and all other Applicable Laws. Each Grantor further agrees
that a breach of any of the covenants contained in this Section 5.3, will
cause irreparable injury to the Administrative Agent and the Secured Parties,
that the Administrative Agent and the Secured Parties have no adequate remedy at
law in respect of such breach and, as a consequence, that each and every
covenant contained in this Section 5.3, shall be
specifically enforceable against such Grantor, and such Grantor hereby waives
and agrees not to assert any defenses against an action for specific performance
of such covenants except for a defense that no Event of Default has occurred
under the Credit Agreement.





SECTION
5.4                                           Application of
Proceeds. At such intervals as may be agreed upon by the Borrower and the
Administrative Agent, or, if an Event of Default shall have occurred and be
continuing, at any time at the Administrative Agent's election, the
Administrative Agent may apply all or any part of the Collateral or any Proceeds
of the Collateral in payment in whole or in part of the Obligations (after
deducting all reasonable costs and expenses of every kind incurred in connection
therewith or incidental to the care or safekeeping of any of the Collateral or
in any way relating to the Collateral or the rights of the Administrative Agent
and the Secured Parties hereunder, including, without limitation, reasonable
attorneys' fees and disbursements) in accordance with Section 11.4 of the
Credit Agreement. Only after (a) the payment by the Administrative Agent of any
other amount required by any provision of Applicable Law, including, without
limitation, Section 9-610 and Section 9-615 of the UCC and (b) the payment in
full of the Obligations and the termination of the Commitments, shall the
Administrative Agent account for the surplus, if any, to any Grantor, or to
whomever may be lawfully entitled to receive the same (if such Person is not a
Grantor).




SECTION
5.5                                           Waiver, Deficiency.
Each Grantor hereby waives, to the extent permitted by Applicable Law, all
rights of redemption, appraisement, valuation, stay, extension or moratorium now
or hereafter in force under any Applicable Law in order to prevent or delay the
enforcement of this Agreement or the absolute sale of the Collateral or any
portion thereof. Each Grantor shall remain liable for any deficiency if the
proceeds of any sale or other disposition of the Collateral are insufficient to
pay its Obligations and the fees and disbursements of any attorneys employed by
the Administrative Agent or any Lender to collect such deficiency.





ARTICLE
VI





THE ADMINISTRATIVE
AGENT





SECTION
6.1                                           Administrative Agent's
Appointment as Attorney-In-Fact.




(a)           Each
Grantor hereby irrevocably constitutes and appoints the Administrative Agent and
any officer or agent thereof, with full power of substitution, as its true and
lawful attorney-in-fact with full irrevocable power and authority in the place
and stead of such Grantor and in the name of such Grantor or in its own name,
for the purpose of carrying out the terms of this Agreement, to take any and all
appropriate action and to execute any and all documents and instruments which
may be necessary or desirable to accomplish the purposes of this Agreement, and,
without limiting the generality of the foregoing, each Grantor hereby gives the
Administrative Agent the power and right, on behalf of such Grantor, without
notice to or assent by such .Grantor, to do any or all of the following upon the
occurrence and during the continuation of an Event of Default:





(i)
              in
      the name of such Grantor or its own name, or otherwise, take possession of
      and indorse and collect any checks, drafts, notes, acceptances or other
      instruments for the payment of moneys due under any Account or Material
      Contract subject to a Security Interest or with respect to any other
      Collateral and file any claim or take any other action or proceeding in
      any court of law or equity or otherwise deemed appropriate by the
      Administrative Agent for the purpose of collecting any and all such moneys
      due under any Account or Material Contract subject to a Security Interest
      or with respect to any other Collateral whenever
  payable;





(ii)
              in
      the case of any Intellectual Property, execute and deliver, and have
      recorded, any and all agreements, instruments, documents and papers as the
      Administrative Agent may request to evidence the Administrative Agent's
      and the Secured Parties' security interest in such Intellectual Property
      and the goodwill and General Intangibles of such Grantor relating thereto
      or represented thereby;





(iii)
              pay
      or discharge taxes and Liens levied or placed on or threatened against the
      Collateral, effect any repairs or any insurance called for by the terms of
      this Agreement and pay all or any part of the premiums therefor and the
      costs thereof;





(iv)
              execute,
      in connection with any sale provided for in this Agreement, any
      endorsements, assignments or other instruments of conveyance or transfer
      with respect to the Collateral;
and





(v)
              (A)
      direct any party liable for any payment under any of the Collateral to
      make payment of any and all moneys due or to become due thereunder
      directly to the Administrative Agent or as the Administrative Agent shall
      direct; (B) ask or demand for, collect, and receive payment of and receipt
      for, any and all moneys, claims and other amounts due or to become due at
      any time in respect of or arising out of any Collateral; (C) sign and
      indorse any invoices, freight or express bills, bills of lading, storage
      or warehouse receipts, drafts against debtors, assignments, verifications,
      notices and other documents in connection with any of the Collateral; (D)
      commence and prosecute any suits, actions or proceedings at law or in
      equity in any court of competent jurisdiction to collect the Collateral or
      any portion thereof and to enforce any other right in respect of any
      Collateral; (E) defend any suit, action or proceeding brought against such
      Grantor with respect to any Collateral; (F) settle, compromise or adjust
      any such suit, action or proceeding and, in connection therewith, give
      such discharges or releases as the Administrative Agent may deem
      appropriate; (G) assign any Copyright, Patent or Trademark (along with the
      goodwill of the business to which any such Copyright, Patent or Trademark
      pertains), for such term or terms, on such conditions, and in such manner,
      as the Administrative Agent shall in its sole discretion determine; and
      (H) generally, sell, transfer, pledge and make any agreement with respect
      to or otherwise deal with any of the Collateral as fully and completely as
      though the Administrative Agent were the absolute owner thereof for all
      purposes, and do, at the Administrative Agent's option and such Grantor's
      expense, at any time, or from time to time, all acts and things which the
      Administrative Agent deems necessary to protect, preserve or realize upon
      the Collateral and the Administrative Agent's and the Secured Parties'
      Security Interests therein and to effect the intent of this Agreement, all
      as fully and effectively as such Grantor might
  do.




(b)           If
any Grantor fails to perform or comply with any of its agreements contained
herein, the Administrative Agent, at its option, but without any obligation so
to do, may perform or comply, or otherwise cause performance or compliance, with
such agreement in accordance with the provisions of Section
6.1(a).




(c)           The
expenses of the Administrative Agent incurred in connection with actions taken
pursuant to the terms of this Agreement, together with interest thereon at a
rate per annum equal to the highest rate per annum at which interest would then
be payable on any category of past due Base Rate Loans under the Credit
Agreement, from the date of payment by the Administrative Agent to the date
reimbursed by the relevant Grantor, shall be payable by such Grantor to the
Administrative Agent on demand.





(d)           Each
Grantor hereby ratifies all that said attorneys shall lawfully do or cause to be
done by virtue hereof in accordance with Section 6.1(a). All
powers, authorizations and agencies contained in this Agreement are coupled with
an interest and are irrevocable until this Agreement is terminated and the
Security Interests created hereby are released.





SECTION
6.2                                           Duty of Administrative
Agent. The Administrative Agent's sole duty with respect to the custody,
safekeeping and physical preservation of the Collateral in its possession, under
Section 9-207 of the UCC or otherwise, shall be to deal with it in the same
manner as the Administrative Agent deals with similar property for its own
account. Neither the Administrative Agent, any Lender nor any of their
respective officers, directors, employees or agents shall be liable for failure
to demand, collect or realize upon any of the Collateral or for any delay in
doing so or shall be under any obligation to sell or otherwise dispose of any
Collateral upon the request of any Grantor or any other Person or to take any
other action whatsoever with regard to the Collateral or any part thereof. The
powers conferred on the Administrative Agent and the Secured Parties hereunder
are solely to protect the Administrative Agent's and the Secured Parties'
interests in the Collateral and shall not impose any duty upon the
Administrative Agent or any Lender to exercise any such powers. The
Administrative Agent and the Secured Parties shall be accountable only for
amounts that they actually receive as a result of the exercise of such powers,
and neither they nor any of their officers, directors, employees or agents shall
be responsible to any Grantor for any act or failure to act hereunder, except
for their own gross negligence or willful misconduct.





SECTION
6.3                                           Authority of Administrative
Agent. Each Grantor acknowledges that the rights and responsibilities of
the Administrative Agent under this Agreement with respect to any action taken
by the Administrative Agent or the exercise or non-exercise by the
Administrative Agent of any option, voting right, request, judgment or other
right or remedy provided for herein or resulting or arising out of this
Agreement shall, as between the Administrative Agent and the Secured Parties, be
governed by the Credit Agreement and by such other agreements with respect
thereto as may exist from time to time among them, but, as between the
Administrative Agent and the Grantors, the Administrative Agent shall be
conclusively presumed to be acting as agent for the Secured Parties with full
and valid authority so to act or refrain from acting, and no Grantor shall be
under any obligation, or entitlement to make any inquiry respecting such
authority.




ARTICLE
VII





MISCELLANEOUS




SECTION
7.1                                           Amendments in
Writing. None of the terms or provisions of this Agreement may be waived,
amended, supplemented or otherwise modified except in accordance with Section 13.2 of the
Credit Agreement.





SECTION
7.2                                           Notices. All notices,
requests and demands to or upon the Administrative Agent or any Grantor
hereunder shall be effected in the manner provided for in Section 13.1 of the
Credit Agreement.





SECTION
7.3                                           No Waiver by Course of
Conduct, Cumulative Remedies. Neither the Administrative Agent nor any
Lender shall by any act (except by a written instrument pursuant to Section 7.1), delay,
indulgence, omission or otherwise be deemed to have waived any right or remedy
hereunder or to have acquiesced in any Default or Event of Default. No failure
to exercise, nor any delay in exercising on the part of the Administrative Agent
or any Lender, any right, power or privilege hereunder shall operate as a waiver
thereof. No single or partial exercise of any right, power or privilege
hereunder shall preclude any other or further exercise thereof or the exercise
of any other right, power or privilege. A waiver by the Administrative Agent or
any Lender of any right or remedy hereunder on any one occasion shall not be
construed as a bar to any right or remedy which the Administrative Agent or such
Lender would otherwise have on any future occasion. The rights and remedies
herein provided are cumulative, may be exercised singly or concurrently and are
not exclusive of any other rights or remedies provided by law.





SECTION
7.4                                           Enforcement Expenses,
Indemnification.





(a)           Each
Grantor agrees to pay or reimburse each Lender and the Administrative Agent for
all its costs and expenses incurred in connection with enforcing or preserving
any rights under this Agreement and the other Loan Documents to which such
Grantor is a party, (including, without limitation, in connection with any
workout, restructuring, bankruptcy or other similar proceeding) including,
without limitation, the reasonable fees and disbursements of counsel to each
Lender and of counsel to the Administrative Agent.





(b)           Each
Grantor agrees to pay, and to save the Administrative Agent and the Secured
Parties harmless from, any and all liabilities with respect to, or resulting
from any delay in paying, any and all stamp, excise, sales or other taxes (in
each case, subject to Section 4.11 of the
Credit Agreement) which may be payable or determined to be payable with respect
to any of the Collateral or in connection with any of the transactions
contemplated by this Agreement.




(c)           Each
Grantor agrees to pay, and to save the Administrative Agent and the Secured
Parties harmless from any and all liabilities, obligations, losses, damages,
penalties, costs and expenses in connection with actions, judgments, suits,
costs, expenses or disbursements of any kind or nature whatsoever with respect
to the execution, delivery, enforcement, performance and administration of this
Agreement to the extent any Grantor would be required to do so pursuant to Section 13.3 of the
Credit Agreement.





(d)           To
the fullest extent permitted by Applicable Law, each Grantor shall not assert,
and hereby waives, any claim against any indemnitee, on any theory of liability,
for special, indirect, consequential or punitive damages (as opposed to direct
or actual damages) arising out of, in connection with, or as a result of, this
Agreement, any other Loan Document or any agreement or instrument contemplated
hereby or the transactions contemplated hereby or thereby. No indemnitee
referred to in this Section 7.4 shall be
liable for any damages arising from the use by unintended recipients of any
information or other materials distributed by it through telecommunications,
electronic or other information transmission systems in connection with this
Agreement or the other Loan Documents or the transactions contemplated .hereby
or thereby.





(e)           The
agreements in this Section 7.4 shall
survive termination of the Commitments and repayment of the Obligations and all
other amounts payable under the Credit Agreement and the other Loan
Documents.





SECTION
7.5                                Waiver of Jury Trial.
EACH GRANTOR HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY
APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING
DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER
LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY (WHETHER BASED
ON CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO
REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PERSON HAS REPRESENTED, EXPRESSLY
OR OTHERWISE, THAT SUCH OTHER PERSON WOULD NOT, IN THE EVENT OF LITIGATION, SEEK
TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER
PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT AND THE OTHER LOAN
DOCUMENTS TO WHICH IT IS A PARTY BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND
CERTIFICATIONS IN THIS SECTION.





SECTION
7.6                                           Successors and
Assigns. This Agreement shall be binding upon the successors and assigns
of each Grantor and shall inure to the benefit of each Grantor (and shall bind
all Persons who become bound as a Grantor to this Collateral Agreement), the
Administrative Agent and the Secured Parties and their successors and assigns;
provided that
no Grantor may assign, transfer or delegate any of its rights or obligations
under this Agreement without the prior written consent of the Administrative
Agent (given in accordance with Section
7.1).





SECTION
7.7                                           Set-Off. Each Grantor
hereby irrevocably authorizes the Administrative Agent and each Lender at any
time and from time to time pursuant to Section 13.4 of the
Credit Agreement, without notice to such Grantor or any other Grantor, any such
notice being expressly waived by each Grantor, to set off and appropriate and
apply any and all deposits (general or special, time or demand, provisional or
final), in any currency, and any other credits, indebtedness or claims, in any
currency, in each case whether direct or indirect, absolute or contingent,
matured or unmatured, at any time held or owing by the Administrative Agent or
such Lender to or for the credit or the account of such Grantor, or any part
thereof in such amounts as the Administrative Agent or such Lender may elect,
against and on account of the obligations and liabilities of such Grantor to the
Administrative Agent or such. Lender hereunder and claims of every nature and
description of the Administrative Agent or such Lender against such Grantor, in
any currency, whether arising hereunder, under the Credit Agreement, any other
Loan Document or otherwise, as the Administrative Agent or such Lender may
elect, whether or not the Administrative Agent or any Lender has made any demand
for payment and although such obligations, liabilities and claims may be
contingent or unmatured. The Administrative Agent and each Lender shall notify
such Grantor promptly of any such set off and the application made by the
Administrative Agent or such Lender of the proceeds thereof; provided that the
failure to give such notice shall not affect the validity of such set off and
application. The rights of the Administrative Agent and each Lender under this
Section 7.7 are
in addition to other rights and remedies (including, without limitation, other
rights of set-off) which the Administrative Agent or such Lender may
have.




SECTION
7.8                                           Counterparts. This
Agreement may be executed by one or more of the parties to this Agreement on any
number of separate counterparts (including by telecopy), and all of said
counterparts taken together shall be deemed to constitute one and the same
instrument.





SECTION
7.9                                           Severability. Any
provision of this Agreement or any other Loan Agreement which is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
only to the extent of such prohibition or unenforceability without invalidating
the remainder of such provision or the remaining provisions hereof or thereof or
affecting the validity or enforceability of such provision in any other
jurisdiction.





SECTION
7.10                                        
Section
Heading. The section headings used in this Agreement are for convenience
of reference only and are not to affect the construction hereof or be taken into
consideration in the interpretation hereof.





SECTION
7.11                                        
Integration.
This Agreement and the other Loan Documents represent the agreement of the
Grantors, the Administrative Agent and the Secured Parties with respect to the
subject matter hereof and thereof, and there are no promises, undertakings,
representations or warranties by the Administrative Agent or any Lender relative
to subject matter hereof and thereof not expressly set forth or referred to
herein or in the other Loan Documents.





SECTION
7.12                                      
 Governing
Law. This Agreement unless otherwise expressly set forth herein, shall be
governed by, construed, interpreted and enforced in accordance with, the laws of
the State of New York (including Section 5-1401 and Section 5-1402 of the
General Obligation Law of the State of New York) without reference to any other
conflicts of law principles thereof.





SECTION
7.13                                       
Consent to
Jurisdiction. Each Grantor hereby irrevocably consents to the personal
jurisdiction of the state and federal courts located in New York, New York, in
any action, claim or other proceeding arising out of any dispute in connection
with this Agreement, the Notes and the other Loan Documents, any rights or
obligations hereunder or thereunder, or the performance of such rights and
obligations. Each Grantor hereby irrevocably consents to the service of a
summons and complaint and other process in any action, claim or proceeding
brought by the Administrative Agent or any Lender in connection with this
Agreement, the Notes or the other Loan Documents, any rights or obligations
hereunder or thereunder, or the performance of such rights and obligations, on
behalf of itself or its property, in the manner specified in Section 13.1 of the
Credit Agreement. Nothing in this Section 7.13 shall
affect the right of the Administrative Agent or any Lender to serve legal
process in any other manner permitted by Applicable Law or affect the right of
the Administrative Agent or any Lender to bring any action or proceeding against
any Grantor or its properties in the courts of any other
jurisdictions.





SECTION
7.14                                       
Acknowledgements.




(a)           Each
Grantor hereby acknowledges that: (i) it has been advised by counsel in the
negotiation, execution and delivery of this Agreement and the other Loan
Documents to which it is a party, (ii) neither the Administrative Agent nor any
Lender has any fiduciary relationship with or duty to any Grantor arising out of
or in connection with this Agreement or any of the other Loan Documents, and the
relationship between the Grantors, on the one hand, and the Administrative Agent
and Secured Parties, on, the other hand, in connection herewith or therewith is
solely that of debtor and creditor, and (iii) no joint venture is created hereby
or by the other Loan Documents or otherwise exists by virtue of the transactions
contemplated hereby or thereby among the Secured Parties or among the Grantors
and the Secured Parties.





(b)           Each
Issuer party to this Agreement acknowledges receipt of a copy of this Agreement
and agrees to be bound thereby and to comply with the terms thereof insofar as
such terms are applicable to it. Each Issuer agrees to provide such notices to
the Administrative Agent as may be necessary to give full effect to the
provisions of this Agreement.





SECTION
7.15                                        
Additional
Grantors. Each Subsidiary of the Borrower that is required to become a
party to this Agreement pursuant to Section 8.11 of the
Credit Agreement shall become a Grantor for all purposes of this Agreement upon
execution and delivery by such Subsidiary of a joinder agreement in form and
substance satisfactory to the Administrative Agent.





SECTION
7.16                                        
Releases.





(a)           At
such time as the Obligations shall have been paid in full and the Commitments
have been terminated, the Collateral shall be released from the Liens created
hereby, and this Agreement and all obligations (other than those expressly
stated to survive such termination) of the Administrative Agent and each Grantor
hereunder shall terminate, all without delivery of any instrument or performance
of any act by any party, and all rights to the Collateral shall revert to the
Grantors. At the request and sole expense of any Grantor following any such
termination, the Administrative Agent shall deliver to such Grantor any
Collateral held by the Administrative Agent hereunder, and execute and deliver
to such Grantor such documents as such Grantor shall reasonably request to
evidence such termination





(b)           If
any of the Collateral shall be sold, transferred or otherwise disposed of by any
Grantor in a transaction permitted by the Credit Agreement, then the
Administrative Agent, at the request and sole expense of such Grantor, shall
execute and deliver to such Grantor all releases or other documents reasonably
necessary or desirable for the release of the Liens created hereby on such
Collateral. In the event that all the capital stock of any Grantor shall be
sold, transferred or otherwise disposed of in a transaction permitted by the
Credit Agreement, then, at the request of the Borrower and at the expense of the
Grantors, such Grantor shall be released from its obligations hereunder; provided that the
Borrower shall have delivered to the Administrative Agent, at least ten (10)
Business Days prior to the date of the proposed release, a written request for
release identifying the relevant Grantor and the terms of the sale or other
disposition in reasonable detail, including the price thereof and any expenses
in connection therewith, together with a certification by the Borrower stating
that such transaction is in compliance with the Credit Agreement and the other
Loan Documents.





[Signature
Pages to Follow]











IN WITNESS WHEREOF, the parties hereto
have caused this Collateral Agreement to be executed under seal by their duly
authorized officers, all as of the day and year first written
above.





LMI AEROSPACE, INC., as
      GrantorBy:  _______________________________Name: _____________________________Title:  _____________________________








PRECISE MACHINE COMPANY,
      as Grantorand
      IssuerBy: ________________________________Name:  _____________________________Title: ______________________________








PRECISE MACHINE PARTNERS,
      L.L.P, as Grantor and IssuerBy:  Precise Machine
      Company, itsmanaging partnerBy:  ________________________________Name:  _____________________________Title: ______________________________








LEONARD’S METAL, INC.,
      as Grantor andIssuerBy:  _________________________________Name: ______________________________Title: _______________________________








LMI FINISHING, INC., as
      Grantor and IssuerBy:  ________________________________Name: _____________________________Title: ______________________________











VERSAFORM CORP., as
      Grantor and IssuerBy: ________________________________Name: _____________________________Title: ______________________________








TEMPCO ENGINEERING,
      INC., as Grantorand
      IssuerBy: __________________________________Name: _______________________________Title: ________________________________








LMI KITTING, LLC, as
      Grantor and IssuerBy: __________________________________Name: _______________________________Title: ________________________________








LMI-TCA, INC., as
      Grantor and IssuerBy: __________________________________Name: _______________________________Title: ________________________________








D3 TECHNOLOGIES, INC.,
      as Grantor andIssuerBy: __________________________________Name:  ______________________________Title: ________________________________








[Signature
Pages Continue]











WACHOVIA BANK, NATIONAL
      ASSOCIATION, as Administrative AgentBy: ____________________________Name: _________________________Title: __________________________














SCHEDULE
3.6


to


Collateral
Agreement








Exact
Legal Name; Jurisdiction of Organization; Taxpayer Identification Number;
Registered


Organization
Number; Mailing Address; Chief Executive Office and other Locations











SCHEDULE
3.7


to


Collateral
Agreement








Government
Contracts














SCHEDULE
3.9


to


Collateral
Agreement





Commercial
Tort Claims











SCHEDULE
3.10


to


Collateral
Agreement








Deposit
Accounts





Grantor
                    Financial Institution
                    Account Number
                    Address of Financial
                      Institution
                    Account Purpose

















SCHEDULE
3.11


to


Collateral
Agreement








Intellectual
Property




1.           
The listing of Trademarks (as defined in the Collateral Agreement) should
include: (a) the Trademark; (b) Registration Number or Serial Number; (c) the
Owner; (d) the Filing Date; (e) the Registration Date (if applicable); (f) the
Date Affidavit of Use and/or Renewal is Due; and (g) Whether the Affidavit of
Use and/or Renewal has been filed.





2.           
The listing of Trademark Licenses (as defined in the Collateral Agreement)
should include: (a) Name and Address of Licensee/Licensor; (b) Date; (c) List of
each Trademark Licensed/Assigned; and (d) Description of product to which
license/assignment applies.





3.           
The listing of Patents (as defined in the Collateral Agreement) should include:
(a) Country; (b) Patent Number; (c) Issue Date; (d) Inventor(s); (e) Title of
Invention; (f) Dates on which Maintenance Fees were paid; and (g) Identity of
Party Paying Maintenance Fees.





4.           The
listing of Patent (as defined in the Collateral Agreement) applications should
include: (a) Application Number; (b) Filing Date; (c) Inventors; and (d) Title
of Invention.





5.           
The listing of Patent Licenses (as defined in the Collateral Agreement) should
include: (a) Name and Address of Licensee/Licensor; (b) Date; (c) List of each
Patent Licensed/Assigned; and (d) Description of product to which
license/assignment applies





6.           
The listing of Copyrights (as defined in the Collateral Agreement) should
include: (a) Registration Number; (b) Registration Date; (c) Title as listed in
Registration; (d) Publication Date; (e) Creation Date; (f) Author; and(g)
Subject Matter Covered.





7.           The
listing of Copyright Licenses (as defined in the Collateral Agreement) should
include: (a) Name and Address of Licensee/Licensor; (b) Date; (c) Work Licensed
or Assigned.











SCHEDULE
3.13


to


Collateral
Agreement








Investment
Property and Partnership/LLC Interests





Certificated
Securities:


Grantor:





Name of
      Issuer
                    Class and Series
                    Par Value
                    Certificate Number
                    Percentage of
                      Ownership Interests of
                      such Class and Series


Securities
Accounts (including cash management accounts that are Investment Property) and
Uncertificated Securities:


Grantor:





Financial Institution
                    Account Number
                    Address of Financial
                      Institution
                    Account
      Purpose





Name of Issuer
                      Class and Series
                      Par Value
                      Percentage
      of Ownership
                        Interests of such Class and
      Series


Partnerships/LLC
Interests:


Grantor:





Name of Issuer
                (including
      identification of
                type
      of entity)
              Type of Ownership Interest
              Certificate Number
                (if
      any)
              Percentage of Ownership
                Interests of such Type




















EXHIBIT
A-1





Form of
Assignment Agreement











EXHIBIT
A-2





Form of
Notice of Assignment










WACHOVIA
BANK, NATIONAL ASSOCIATION/LMI AEROSPACE, INC.
 Schedules
to Credit Agreement







SCHEDULE
1.1
 
 Lenders and
Commitments
 
 Name
      of Lender
                                            Amount
      of Revolving Commitment
                                            Revolving
      Commitment PercentageWachovia
      Bank, National Association
                                            $20,000,000
                                            25%Wells
      Fargo Bank, N.A.
                                            $20,000,000
                                            25%LaSalle
      Bank National Association
                                            $10,000,000
                                            12.5%Charter
      One Bank, N.A.
                                            $10,000,000
                                            12.5%Comerica
      Bank
                                            $10,000,000
                                            12.5%U.S.
      Bank, National Association
                                            $10,000,000
                                            12.5%Totals
                                            $80,000,000
                                            100%







SCHEDULE
1.1(a)
 
 Existing Letters of
Credit
 
 None.
  
  Schedule
1.1
 
 Lenders
and Commitments
  Schedule
6.1(a)
 
 Jurisdictions of
Organization and Qualification:
 
 Company
                                                                                                                  State
      of Formation
                                                                                                                  Where
      qualifiedLMI
      Aerospace, Inc.
                                                                                                                  Missouri
                                                                                                                  N/ALeonard’s
      Metal, Inc.
                                                                                                                  Missouri
                                                                                                                  KansasWashingtonGeorgiaLMI
      Finishing, Inc.
                                                                                                                  Oklahoma
                                                                                                                  N/ALMI-TCA,
      Inc.
                                                                                                                  Delaware
                                                                                                                  ArizonaCaliforniaWashingtonUtahPrecise
      Machine Company
                                                                                                                  Missouri
                                                                                                                  TexasTempco
      Engineering, Inc.
                                                                                                                  Missouri
                                                                                                                  CaliforniaVersaform
      Corp.
                                                                                                                  California
                                                                                                                  N/APrecise
      Machine Partners, L.L.P.
                                                                                                                  Texas
                                                                                                                  N/ALMI
      Kitting, LLC
                                                                                                                  Delaware
                                                                                                                  GeorgiaD3
      Technologies, Inc.
                                                                                                                  California
                                                                                                                  ColoradoKansas
      (application in progress)South
      CarolinaTexasVirginiaWashingtonWashington,
      DC (application in
progress)
 
  
  Schedule
6.1(b)
 
 Subsidiaries and
Capitalization:
 
 Company
      Name
                                                            Domestic
      Jurisdiction
                                                            %
                                                              Owned
                                                            Stock
                                                              Cert.
      No.
                                                            Number
      of
                                                              Shares
      IssuedLeonard’s
      Metal, Inc.
                                                            Missouri
                                                            100%
                                                            2
                                                            30,000
      shares commonLMI
      Finishing, Inc.
                                                            Oklahoma
                                                            100%
                                                            2
                                                            100
      shares commonLMI-TCA,
      Inc.
                                                            Delaware
                                                            100%
                                                            1
                                                            1,000
      shares commonPrecise
      Machine
                                                              Company
                                                            Missouri
                                                            100%
                                                            1A
                                                            100
      shares commonTempco
      Engineering, Inc.
                                                            Missouri
                                                            100%
                                                            2
                                                            100
      shares commonVersaform
      Corp.
                                                            California
                                                            100%
                                                            7
                                                            475
      shares commonPrecise
      Machine Partners, L.L.P.
                                                            Texas
                                                            99%
                                                            N/A
                                                            N/ALMI
      Kitting, LLC
                                                            Delaware
                                                            100%
                                                            N/A
                                                            N/AD3
      Technologies, Inc.
                                                            California
                                                            100%
                                                            10
                                                            25,000
      shares
common
 
 Schedule
6.1(f)
 
 IRS
Audits:
 
 The Internal Revenue Service is
reviewing Borrower’s application for research and development tax credits for
the years 2002 and 2003.  This is not a general audit.
 
 Schedule
6.1(i)
 
 Employee Benefit
Plans:
 
 1.           Borrower
maintains a non-contributory profit sharing plan and a contributory 401(k) plan
as described in Footnote 11 to Borrower’s audited consolidated financial
statement for the year ended December 31, 2006.
 
 2.           Borrower
has adopted the LMI Aerospace, Inc. 2005 Long-Term Incentive Plan as described
in Footnote 12 to Borrower’s audited consolidated financial statement for the
year ended December 31, 2006.
 
  
  3.           Borrower
has the following health plans:
 
 PLAN
      NAME
                VENDOR
      NAME
                GROUP
      #
                INSURANCE
      TYPE
                SUMMARY
      DESCRIPTIONBasic
      Medical
                United
      Healthcare
                700452
                Medical/Pharmacy
                Basic
      HMO plan with $25/$50 copays and 90% coinsuranceBuy-Up
      Medical
                United
      Healthcare
                700452
                Medical/Pharmacy
                Buy-Up
      HMO plan with $20/$40 copay and 100% coinsuranceChoice
      Plus Medical
                United
      Healthcare
                700452
                Medical/Pharmacy
                PPO
      plan with $25/$50 copays and 80%/60% coinsuranceHMO
      Dental
                Cigna
      Dental
                10047459
                Dental
                HMO
      dental planPPO
      Dental
                Delta
      Dental
                7611-1000
                Dental
                PPO
      dental planVision
      Plan
                Spectera
      Vision
                700452
                Vision
                Standard
      vision plan – Employee paidAFLAC
                AFLAC
                KR111
                Accident
                Off-the-job
      accident coverage – Employee paidAFLAC
                AFLAC
                KR111
                Cancer
                Reimbursement
      insurance for cancer diagnosis – Employee paidAFLAC
                AFLAC
                KR111
                Short-Term
      Disability
                Provides
      STD for hourly employees after 26 weeks – Employee paidBasic
      Life Insurance
                Uniamerica
                700452
                Basic
      Life
                Company-paid
      basic life $25k for hourly employees and 2x salary plus $25k for salaried
      employeesBasic
      AD&D
                Uniamerica
                700452
                Basic
      AD&D
                Company-paid
      basic life $25k for hourly employees and 2x salary plus $25k for salaried
      employeesVoluntary
      Life
                Uniamerica
                700452
                Supplemental
      Life
                Additional
      life insurance for employee, spouse and children – Employee
      paidVoluntary
      AD&D
                Uniamerica
                700452
                Supplemental
      AD&D
                Additional
      AD&D insurance for employee and/or family – Employee
    paidHMO
      Medical
                Blue
      Cross Blue Shield of Kansas
                2658610
                Medical/Pharmacy
                HMO
      plan for Wichita employeesHMO
      Medical
                Blue
      Cross Blue Shield of California
                57417AF
                Medical/Pharmacy
                HMO
      plan for California employeesFlex
      Spending Acct
                United
      Healthcare
                706097
                Section
      125 Plan
                Reimbursement
      accounts for medical, dental or vision expenses on a pre-tax
      basisFlex
      Spending Acct
                Self
      Administered
                
                Section
      125 plan
                Reimbursement
      account for eligible dependent day-care expenses on a pre-tax
      basisLong-Term
      Disability
                Uniamerica
                700452
                Long-Term
      Disability
                LTD
      for salaried employees for 60% of pay – employee paid so benefit is tax
      exemptShort-Term
      Disability
                Self
      Administered
                
                Short-Term
      Disability
                Hourly
      employees 60% of weekly pay up to $300, salaried employee 100% pay for up
      to 26 weeks401(k)
                Nationwide
                23480045
                401(k)
      and Profit Sharing
                401(k)
      plan with 50% company match up to $2,000 of contribution, discretional
      profit sharing contributionMoney
      Purchase Plan
                Morgan
      Stanley
                various
                Money
      Purchase Plan
                MPP
      for Versaform employees
only.
  
  4.           D3
has the following benefit plans:
 
 Health
      Net (San Diego Medical Plan)Account
      #577 14-A, #577 14-BHealth
      Net of California, Inc.Regional
      sales – San Diego3131
      Camino del Rio North, Suite #100San
      Diego, CA  92108Client
      Manager: Mr. Jose Martinez(619)
      521-4953(619)
      521-4986 (fax)Jose.martinez@healthnet.comEffective:
      1/1/20007 – 12/31/2007
 
 Kaiser
      (San Diego Medical Plan)Account
      #107243-0000Kaiser
      Foundation Health Plan, Inc.8889
      Rio San Diego Drive, Suite 200San
      Diego, CA 92108Client
      Manager: Audrey Mueller Rollins(619)
      542-7250(619)
      542-7251 (fax)Audrey
      E. Rollins @kp.orgEffective:
      1/1/2007 – 12/31/2007
 
 Premera Blue Cross WAHIT
      (Washington Alliance for Healthcare Insurance Trust Medical Plan)
      (Washington, Texas, South Carolina, Virginia)Account
      #4385 – Premera ID #9502988Sound
      Benefit Plans, Inc.P.O.
      Box 12427Mill
      Creek, WA  98082Client
      Manager: Brandi Mattingly(425)
      741-7099(425)
      741-7098 (fax)brandi@soundbenefitplans.comEffective:
      7/1/2007 – 6/30/2008
 
 Ameritas
      Life Insurance Corp (San Diego Dental Plan)Account
      #010-12542-0001Ameritas
      Life Insurance CorpP.O.
      Box 81889Lincoln,
      NE  68501-1889Client
      Contact Center: 1-800-659-2223www.ameritasgroup.com/employerEffective:
      12/1/2006 – 11/30/2007
  
  
 Assurant
      Employee Benefits (Washington, Texas, South Carolina, Virginia Dental
      Plan)Account
      #4043169-1Sound
      Benefit Plans, Inc.P.O.
      Box 12427Mill
      Creek, WA  98082Client
      Manager: Brandi Mattingly(425)
      741-7099(425)
      741-7098 (fax)www.assurantemployeebenefits.comEffective:
      10/1/2006 – 9/30/2007
 
 Reliance
      Standard Life Insurance Company (Standard Life)Account
      #GL033818Reliance
      Standard Life Insurance Company27201
      Puerta Real, #320Mission
      Viejo, CA  92691Client
      Manager: Marshawn K. Guptill(949)
      309-5970(949)
      309-5998 (fax)Marshawn.guptill@rsli.comEffective:
      5/1/1998
 
 Reliance
      Standard Life Insurance CompanyLong-Term
      PolicyPolicyholder:
      D3 Technologies, Inc.Participating
      Unit # VIP539942Home
      Office: Chicago, IllinoisEffective:
      July 1, 2001
 
 Reliance
      Standard Life Insurance CompanyShort-Term
      PolicyPolicyholder:
      D3 Technologies, Inc.Participating
      Unit # VIP539943Home
      Office: Chicago, IllinoisEffective:
      July 1, 2001
 
 401(k)
      PlanAlpha
      & Omega Financial Management Consultants8580
      La Mesa Blvd Suite 100 La Mesa, CA  91941(619)
      462-7812Effective:
      August 15, 2003
 
  
  Schedule
6.1(l)
 
 Material
Contracts:
 
 1.           Employment
Agreement, dated January 1, 2006, between LMI Aerospace, Inc. and Ronald S.
Saks.
 
 2.           Lease
Agreement dated November 25, 1991, between LMI Aerospace, Inc. and Roy R. Thoele
and Madonna J. Thoele, including all amendments (leased premises at 3000 Highway
94 North, St. Charles, Missouri).
 
 3.           Lease
Agreement dated May 6, 1997, between LMI Aerospace, Inc. and Victor Enterprises,
LLC, including all amendments (leased premises at 101 Western Avenue South,
Auburn, Washington).
 
 4.           Lease
Agreement dated February 1, 1995, between LMI Aerospace, Inc. and RFS
Investments (leased premises at 2621 West Esthner Court, Wichita,
Kansas).
 
 5.           Profit
Sharing and Savings Plan and Trust, including amendments no. 1 through
6.
 
 6.           Employment
Agreement dated January 1, 2006, between LMI Aerospace, Inc. and Michael J.
Biffignani.
  7.           General
Conditions (Fixed Price – Non-Government) for the G-IV/F100 Program, Additional
Conditions for the Wing Stub/Lower 45 Program Boeing Model 767 Commercial
Aircraft and Form of Master Agreement, all with Vought.
 
 8.           Amended
and Restated 1998 Stock Option Plan dated as of May 24, 2000.
 
 9.           Employment
Agreement effective as of January 1, 2006, between LMI Aerospace, Inc. and
Lawrence E. Dickinson.
 
 10.           Business
Reformation Agreement between Leonard’s Metal, Inc. and Lockheed Martin
Aeronautics Company dated September 21, 2001.
  11.           Lease
dated April 2, 2001 by and between Peter Holz and Anna L. Holz, Trustees of the
Peter and Anna L. Holz Trust dated 2/8/89, as to an undivided one-half interest,
and Ernest R. Star and Linda Ann Zoetl, Trustees under the Ernest L. Star and
Elizabeth H. Star 1978 Trust dated August 25, 1978, as to an undivided one-half
interest, and Metal Corporation [now Tempco Engineering,
Inc.].
 
 12.           Lease
dated April 2, 2001, between Tempco Engineering, Inc. and Metal
Corporation.
 
 13.           Employment
Agreement effective as of January 1, 2006, between LMI Aerospace, Inc. and
Robert T. Grah.
 
 
  14.           Employment
Agreement effective as of January 1, 2004, between LMI Aerospace, Inc. and Duane
Hahn.
 
 15.           Net
Industrial lease between Nonar Enterprises and Versaform Corporation dated as of
September 12, 2003.
 
 16.           Memorandum
of Understanding between LMI Aerospace, Inc. and Gulfstream Aerospace
Corporation, dated as of November 1, 2005.
 
 17.           2005
Long-Term Incentive Plan.
 
 18.           General
terms Agreement between Spirit Aerosystems, Inc. (Tulsa Facility) and LMI
Aerospace, Inc. dated April 19, 2006.
 
 19.           Special
Business Provisions between Spirit Aerosystems, Inc. and LMI Aerospace, Inc.
dated April 19, 2006.
 
 20.           Standard
Industrial Lease Agreement dated June 9, 2006, between Welsh Fountain Lakes,
L.L.C., as landlord, and Leonard’s Metal, Inc. as tenant.
 
 21.           Memorandum
of Agreement effective as of January 1, 2006, between Aerospace, Inc. and
Gulfstream Aerospace Corporation.
 
 22.           Amended
and Restated Credit Agreement between LMI Aerospace, Inc. and Wells Fargo Bank
dated December 28, 2006.
 
 23.           Purchase
and lease agreement dated December 28, 2006, between LMI Aerospace, Inc. and CIT
CRE LLC.
 
 24.           Employment
Agreement dated January 2, 2007, between LMI Aerospace, Inc. and Darrel E.
Keesling.
 
 25.           Agreement
and purchase orders with Boeing Company under:
 
 a.
                  Special
      Business Provisions dated April 18, 2005 between D3 Technologies Inc. and
      The Boeing Company, pursuant to which D3 Technologies provides engineering
      services to Boeing for fuselage structural design, fuselage structural
      analysis, wing empennage structure design and wing empennage structure
      analysis; and
 
 b.
                  General
      Terms Agreement dated January 1, 2006 between D3 Technologies, Inc. and
      The Boeing Company providing terms and conditions for the provision of
      engineering services by D3 Technologies to Boeing pursuant to those
      certain Special Business Provisions dated April 18,
  2005.
 
 26.           Contract
#N00178-05-D-4273, effective June 22, 2006, with NAVAIR Weapons Division, China
Lake, CA, for software engineering support services, and purchase orders
thereunder.
  
  27.           LMI
Contracts in excess of $1,000,000:
 
 Long Term
Agreements*
 Customer/Location(s)
                                                            Programs/Applications
                                                            End
      Date
                                                            Contract
      NumberBoeing
      Commercial-Seattle
                                                            737,747,767,777
                                                            12/31/2011
                                                            GTA
      BCA-65344-0990Bombardier
                                                            Dash
      8/Lear 45 Lear 40/45/60
                                                              CRJ
      200/700/900 Challenger
                                                            12/31/2007
                                                            C5198-MISFischer
                                                            737/757
      Winglets
                                                            12/31/2010
                                                            4400000199Gulfstream
                                                            G450/G550
      Kits, G450 Leading
                                                              edge,
      G450/G550 Steel Parts
                                                            12/31/2010
                                                            MOA
      dated Jan 1, 2006Shorts
                                                            CRJ/Challenger
      604
                                                            12/31/2008
                                                            SB-1289-MISSikorsky
      Details/Assys
                                                            MH60R,
      UH60M
                                                            12/31/2009
                                                            G0996814Spirit
      Tulsa
                                                            737
                                                            12/31/2011
                                                            GTA-T5P2-YB001851Spirit
      Wichita
                                                            737,
      747, 767, 777
                                                            12/31/2008
                                                            9441130,
      941239, 941568Vought
      Contract
                                                            767
      PDA/747/GIV-VEP
                                                            12/31/2007
                                                            letter
      agreement
 *- Long
Term Agreements are requirements contracts and, therefore, have no contract
value.  They simply cover all demand for a specified statement of work
through the contract term.
 
 Open
Purchase Orders
 Customer/Location(s)
                                        Programs/Applications
                                        End
      Date
                                        Contract
      Number
                                        AmountVought
      Contract
                                        Blackhawk
      Assemblies and Components
                                        2008
                                        117-617900AZ
                                        $2,633,272.56Vought
      Contract
                                        747
      Kits and Components
                                        2008
                                        117-6101222AZ
                                        1,398,823.17Northrop
                                        Case
      Assemblies for Guidance Systems
                                        4/14/2008
                                        225055
                                        1,694,695.50Northrop
                                        Machined
      components
                                        12/31/2009
                                        225156
                                        2,913,129.00
  
  Schedule
6.1(m)
 
 Labor and Collective
Bargaining Agreements – None.
 
 Schedule
6.1(t)
 
 Indebtedness and Guaranty
Obligations:
 
 Lessor
                                                Lessee
                                                Schedule
      No.
                                                Leased
      Property
                                                Maturity
      Date
                                                Outstanding
      BalanceGeneral
      Electric Capital Corporation
                                                Leonard’s
      Metal, Inc.
                                                4126885003
                                                Brown
      & Sharpe
                                                  Global
      Image
                                                  Coordinating
      Machine
                                                12/1/08
                                                $36,799.19General
      Electric Capital Corporation
                                                Leonard’s
      Metal, Inc.
                                                4136885004
                                                Zimmerman
      FZ-35-5 Milling Machine
                                                1/1/09
                                                $192,310.15General
      Electric Capital Corporation
                                                Leonard’s
      Metal, Inc.
                                                4126885005
                                                Zimmerman
      FZ-35-5 Milling Machine
                                                7/3/11
                                                $300,357.85General
      Electric Capital Corporation
                                                Tempco
      Engineering, Inc.
                                                4133651003
                                                Hass
      Vertical Machining Center
                                                6/1/11
                                                $142,130.27General
      Electric Capital Corporation
                                                Precise
      Machine Partners, L.L.P.
                                                4139438003
                                                Brown
      & Sharpe
                                                  global
      Image System
                                                1/1/12
                                                $33,700.71Total
                                                $705,298.17
 
 Schedule
63.1(u)
 
 Litigation:
  1.           In
February 2004, Versaform Corp. was served with a  grand jury subpoena
and Parent was informed that the U.S. Attorney’s Office for the Southern
District of California, Department of Defense, Office of Inspector General,
Defense Criminal Investigative Service, and the Federal Bureau of Investigation
was conducting an investigation relating to structural components of B-52 engine
cowlings Versaform manufactured for Nordam Corporation, components of auxiliary
power units Versaform manufactured for Hamilton Sundstrand, a United
Technologies Company, and certain tools Versaform manufactured for Lockheed
Martin Corporation.  The subpoena related to the time period January
1, 1999 through February 6, 2004.  Documents responsive to the
subpoena have been produced.
  Neither
Borrower nor Versaform Corp. has been served with notice of any pending legal
action or claim by any governmental agency and neither has been advised of any
specifi9c allegations, although in general Borrower believes that the potential
claims relate to (a) allegedly not following appropriate quality control
procedures, and 9b) allegedly billing defense contractors (who billed the
federal government) for actions not completed.  The last contact by a
governmental agency with Versaform Corp., Borrower or their attorneys regarding
this matter was March 19, 2006.
 
 2.           In
May 2005, Parent presented a $4.0 million claim accompanied by supporting
documentation to a customer regarding a dispute over a price increase and
certain extraordinary costs we incurred.  In response, the customer
presented Parent with a claim for $9.5 million alleging certain of Parent’s
parts were non-conforming.  Parent has requested, but has not yet
received, substantive documentation supporting the customer’s
claim.  No lawsuit has been filed by either party.
 
 
  Schedule
10.2
 
 Existing
Liens
 
 ENTITY
                                                                  LOCATION
                                                                  UCC
      NO.
                                                                  DATE
      OF FILING
                                                                  SECURED
      PARTYMI
      Aerospace, Inc.
                                                                  State
      of Missouri
                                                                  20060060096M
                                                                  6/1/06
                                                                  IBM
      Credit LLCLMI
      Finishing, Inc.
                                                                  State
      of Oklahoma
                                                                  2003001374727
                                                                  2/4/03
                                                                  General
      Electric Capital CorporationPrecise
      Machine Partners, L.L.P.
                                                                  State
      of Texas
                                                                  03-0011338908
                                                                  12/18/02
                                                                  General
      Electric Capital CorporationPrecise
      Machine Partners, L.L.P.
                                                                  State
      of Texas
                                                                  06-0010581758
                                                                  4/1/06
                                                                  General
      Electric Capital CorporationPrecise
      Machine Partners, L.L.P.
                                                                  State
      of Texas
                                                                  07-0000083452
                                                                  1/2/07
                                                                  General
      Electric Capital CorporationLeonard’s
      Metal, Inc.
                                                                  State
      of Missouri
                                                                  20018054527J
                                                                  11/8/01
                                                                  General
      Electric Capital CorporationLeonard’s
      Metal, Inc.
                                                                  State
      of Missouri
                                                                  20020062589L
                                                                  7/2/02
                                                                  General
      Electric Capital CorporationLeonard’s
      Metal, Inc.
                                                                  State
      of Missouri
                                                                  20030011951C
                                                                  2/4/03
                                                                  General
      Electric Capital CorporationLeonard’s
      Metal, Inc.
                                                                  State
      of Missouri
                                                                  20050052677F
                                                                  5/20/05
                                                                  General
      Electric Capital CorporationLeonard’s
      Metal, Inc.
                                                                  State
      of Missouri
                                                                  20050120282C
                                                                  11/30/05
                                                                  General
      Electric Capital CorporationLeonard’s
      Metal, Inc.
                                                                  State
      of Missouri
                                                                  20060002641B
                                                                  1/3/06
                                                                  General
      Electric Capital CorporationLeonard’s
      Metal, Inc.
                                                                  State
      of Missouri
                                                                  20060035848H
                                                                  4/3/06
                                                                  General
      Electric Capital CorporationLeonard’s
      Metal, Inc.
                                                                  State
      of Missouri
                                                                  20060072348C
                                                                  6/30/66
                                                                  General
      Electric Capital CorporationLeonard’s
      Metal, Inc.
                                                                  State
      of Missouri
                                                                  20060103523C
                                                                  9/21/06
                                                                  Steelcase
      Financial Services Inc.Leonard’s
      Metal, Inc.
                                                                  State
      of Missouri
                                                                  20060114589H
                                                                  10/23/06
                                                                  General
      Electric Capital CorporationLeonard’s
      Metal, Inc.
                                                                  State
      of Missouri
                                                                  20060131245F
                                                                  12/4/06
                                                                  General
      Electric Capital
Corporation
 
  
  
 ENTITY
                                                            LOCATION
                                                            UCC
      NO.
                                                            DATE
      OF FILING
                                                            SECURED
      PARTYLeonard’s
      Metal, Inc.
                                                            State
      of Missouri
                                                            20070000417B
                                                            1/2/07
                                                            General
      Electric Capital CorporationTempco
      Engineering, Inc.
                                                            State
      of Missouri
                                                            20020074155G
                                                            6/11/02
                                                            General
      Electric Capital CorporationTempco
      Engineering, Inc.
                                                            State
      of Missouri
                                                            20060035844C
                                                            4/3/06
                                                            General
      Electric Capital CorporationTempco
      Engineering, Inc.
                                                            State
      of Missouri
                                                            20070000774J
                                                            1/3/07
                                                            General
      Electric Capital CorporationVersaform
      Corp.
                                                            State
      of California
                                                            05-7015300132
                                                            2/9/05
                                                            Citicorp
      Leasing, Inc.Versaform
      Corp.
                                                            State
      of California
                                                            06-7097083878
                                                            12/29/06
                                                            General
      Electric Capital CorporationD3
      Technologies, Inc.
                                                            State
      of California
                                                            200128460221
                                                            10/9/01
                                                            U.S.
      Bank National AssociationD3
      Technologies, Inc.
                                                            State
      of California
                                                            20057035960015
                                                            7/28/05
                                                            U.S.
      Bancorp Oliver-Allen Technology LeasingD3
      Technologies, Inc.
                                                            State
      of California
                                                            20057035960136
                                                            7/28/05
                                                            U.S.
      Bancorp Oliver-Allen Technology LeasingD3
      Technologies, Inc.
                                                            State
      of California
                                                            20057035960257
                                                            7/28/05
                                                            U.S.
      Bancorp Oliver-Allen Technology LeasingD3
      Technologies, Inc.
                                                            State
      of California
                                                            20057049515258
                                                            11/22/05
                                                            U.S.
      Bancorp Oliver-Allen Technology
Leasing
 
 Schedule
10.3
 
 Existing Loans to third
parties, advances and Investments – None.
 
 Schedule
10.8
 
 Transactions with
Affiliates
 
 Sanford S. Neuman, a director of the
Company, is the Chairman and a Member of the law firm Gallop, Johnson &
Neuman, L.C., which has provided legal services to the Company in prior years
and is expected to provide legal services to the Company in the
future.
  In
September 2002, the Company acquired from MBSP, L.P., a Nevada limited
partnership, the operations and certain of the assets of the aerospace division
of southern Stretch Forming and Fabrication, Inc., an aerospace sheet metal
manufacturer based in Denton, Texas.  In connection with this
transaction, the Company is required to pay to MBSP, L.P. 5% of the gross sales
of specific parts to a specific customer during the period beginning on January
1, 2003 and ending on December 31, 2007, which payments shall not exceed
$500,000.  Payments to MBSP, L.P. under this agreement were $138,000,
$138,000 and $109,000 for the years ended December 31, 2006, 2005 and 2004,
respectively.