exv10w17






EXHIBIT 10.17




EXECUTION




 





Third Amended and Restated Credit Agreement




dated as of May 4, 2010



among



STATER BROS. MARKETS,



STATER BROS. HOLDINGS INC.



and



Bank of America, N.A.,

as Administrative Agent and

L/C Issuer



and



The Other Financial

Institutions Party Hereto



Banc of America Securities LLC,



as

Sole Arranger and Sole Book Manager








 





 









 





TABLE OF CONTENTS




	 	 	 	 	 
	Section	 	Page
	ARTICLE I DEFINITIONS AND ACCOUNTING TERMS
	 	 	1	 
	 
	 	 	 	 
	1.01 Defined Terms
	 	 	1	 
	 

	1.02 Other Interpretive Provisions
	 	 	23	 
	 

	1.03 Accounting Terms
	 	 	24	 
	 

	1.04 Rounding
	 	 	24	 
	 

	1.05 Times of Day
	 	 	25	 
	 

	1.06 Letter of Credit Amounts
	 	 	25	 
	 
	 	 	 	 
	ARTICLE II the COMMITMENTS and Credit Extensions
	 	 	25	 
	 
	 	 	 	 
	2.01 Loans
	 	 	25	 
	 

	2.02 Borrowings, Conversions and Continuations of Loans
	 	 	25	 
	 

	2.03 Letters of Credit
	 	 	27	 
	 

	2.04 Prepayments
	 	 	36	 
	 

	2.05 Termination or Reduction of Commitments
	 	 	36	 
	 

	2.06 Repayment of Loans
	 	 	37	 
	 

	2.07 Interest
	 	 	37	 
	 

	2.08 Fees
	 	 	37	 
	 

	2.09 Computation of Interest and Fees
	 	 	38	 
	 

	2.10 Evidence of Debt
	 	 	38	 
	 

	2.11 Payments Generally; Administrative Agent’s Clawback
	 	 	39	 
	 

	2.12 Sharing of Payments by Lenders
	 	 	40	 
	 
	 	 	 	 
	ARTICLE III TAXES, YIELD PROTECTION AND ILLEGALITY
	 	 	41	 
	 
	 	 	 	 
	3.01 Taxes
	 	 	41	 
	 

	3.02 Illegality
	 	 	44	 






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	Section	 	Page
	3.03 Inability to Determine Rates
	 	 	45	 
	 

	3.04 Increased Costs
	 	 	45	 
	 

	3.05 Compensation for Losses
	 	 	47	 
	 

	3.06 Mitigation Obligations; Replacement of Lenders
	 	 	47	 
	 

	3.07 Survival
	 	 	48	 
	 
	 	 	 	 
	ARTICLE IV CONDITIONS PRECEDENT TO Credit Extensions
	 	 	48	 
	 
	 	 	 	 
	4.01 Conditions of Initial Credit Extension
	 	 	48	 
	 

	4.02 Conditions to all Credit Extensions
	 	 	49	 
	 
	 	 	 	 
	ARTICLE
 V REPRESENTATIONS AND WARRANTIES
	 	 	50	 
	 
	 	 	 	 
	 

	5.01 Existence, Qualification and Power
	 	 	50	 
	 

	5.02 Power; Authorization; Enforceable Obligations
	 	 	50	 
	 

	5.03 No Legal Bar
	 	 	50	 
	 

	5.04 Financial Statements; No Material Adverse Effect
	 	 	51	 
	 

	5.05 Litigation
	 	 	51	 
	 

	5.06 No Default
	 	 	51	 
	 

	5.07 Ownership of Property; Liens
	 	 	51	 
	 

	5.08 Taxes
	 	 	51	 
	 

	5.09 Margin Regulations; Investment Company Act
	 	 	52	 
	 

	5.10 ERISA Compliance
	 	 	52	 
	 

	5.11 Intangible Assets
	 	 	52	 
	 

	5.12 Compliance with Laws
	 	 	53	 
	 

	5.13 Environmental Compliance
	 	 	53	 
	 

	5.14 Insurance
	 	 	53	 
	 

	5.15 Stockholders Agreements
	 	 	53	 
	 

	5.16 Disclosure
	 	 	53	 






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	Section	 	Page
	5.17 Subsidiaries; Equity Interests
	 	 	53	 
	 
	 	 	 	 
	ARTICLE VI AFFIRMATIVE COVENANTS OF BORROWER
	 	 	53	 
	 
	 	 	 	 
	 

	6.01 Financial Statements
	 	 	53	 
	 

	6.02 Certificates; Notices and Other Information
	 	 	55	 
	 

	6.03 Payment of Obligations
	 	 	57	 
	 

	6.04 Preservation of Existence, Etc..
	 	 	57	 
	 

	6.05 Maintenance of Properties
	 	 	57	 
	 

	6.06 Maintenance of Insurance
	 	 	57	 
	 

	6.07 Compliance with Laws
	 	 	57	 
	 

	6.08 Inspection Rights
	 	 	57	 
	 

	6.09 Books and Records
	 	 	58	 
	 

	6.10 Compliance with ERISA
	 	 	58	 
	 

	6.11 Compliance With Agreements
	 	 	58	 
	 

	6.12 Use of Proceeds
	 	 	58	 
	 

	6.13 Further Assurances
	 	 	58	 
	 

	6.14 Execution of Guaranty by Future Material Subsidiaries
	 	 	58	 
	 
	 	 	 	 
	ARTICLE VII NEGATIVE COVENANTS
	 	 	59	 
	 
	 	 	 	 
	7.01 Indebtedness
	 	 	59	 
	 

	7.02 Liens and Negative Pledges
	 	 	60	 
	 

	7.03 Fundamental Changes
	 	 	61	 
	 

	7.04 Dispositions
	 	 	61	 
	 

	7.05 Investments
	 	 	62	 
	 

	7.06 Lease Obligations
	 	 	62	 
	 

	7.07 Restricted Payments
	 	 	62	 
	 

	7.08 ERISA
	 	 	63	 






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	Section	 	Page
	7.09 Change in Nature of Business
	 	 	63	 
	 

	7.10 Transactions with Affiliates
	 	 	63	 
	 

	7.11 Hostile Acquisitions
	 	 	63	 
	 

	7.12 Financial Covenants
	 	 	63	 
	 

	7.13 Change in Auditors
	 	 	64	 
	 

	7.14 Amendments or Waivers of Senior Note Documents
	 	 	64	 
	 

	7.15 Use of Capital Contributions.
	 	 	64	 
	 

	7.16 Use of Proceeds
	 	 	64	 
	 
	 	 	 	 
	ARTICLE VIII HOLDINGS COVENANTS
	 	 	64	 
	 
	 	 	 	 
	8.01 Indebtedness
	 	 	64	 
	 

	8.02 Restricted Payments
	 	 	65	 
	 

	8.03 Change in Nature of Business; Ownership of Assets
	 	 	65	 
	 

	8.04 Transactions with Affiliates
	 	 	65	 
	 

	8.05 Amendments or Waivers of Senior Note Documents
	 	 	66	 
	 
	 	 	 	 
	ARTICLE IX EVENTS OF DEFAULT AND REMEDIES
	 	 	66	 
	 

	9.01 Events of Default
	 	 	66	 
	 

	9.02 Remedies Upon Event of Default
	 	 	69	 
	 

	9.03 Application of Funds
	 	 	69	 
	 
	 	 	 	 
	ARTICLE X ADMINISTRATIVE AGENT
	 	 	70	 
	 
	 	 	 	 
	10 .01 Appointment and Authority
	 	 	70	 
	 

	10.02 Rights as a Lender
	 	 	71	 
	 

	10.03 Exculpatory Provisions
	 	 	71	 
	 

	10.04 Reliance by Administrative Agent
	 	 	72	 
	 

	10.05 Delegation of Duties
	 	 	72	 
	 

	10.06 Resignation of Administrative Agent
	 	 	72	 






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	Section	 	Page
	10.07 Non-Reliance on Administrative Agent and Other Lenders
	 	 	73	 
	 

	10.08 No Other Duties, Etc.
	 	 	73	 
	 

	10.09 Administrative Agent May File Proofs of Claim
	 	 	73	 
	 

	10.10 Guaranty Matters
	 	 	74	 
	 

	10.11 Lender Cash Management Agreements and Lender Hedge Agreements
	 	 	74	 
	 
	 	 	 	 
	ARTICLE XI MISCELLANEOUS
	 	 	75	 
	 
	 	 	 	 
	11.01 Amendments, Etc.
	 	 	75	 
	 

	11.02 Notices; Effectiveness; Electronic Communication.
	 	 	76	 
	 

	11.03 No Waiver; Cumulative Remedies; Enforcement
	 	 	78	 
	 

	11.04 Expenses; Indemnity; Damage Waiver.
	 	 	78	 
	 

	11.05 Payments Set Aside
	 	 	80	 
	 

	11.06 Successors and Assigns.
	 	 	81	 
	 

	11.07 Treatment of Certain Information; Confidentiality
	 	 	84	 
	 

	11.08 Right of Setoff
	 	 	85	 
	 

	11.09 Interest Rate Limitation
	 	 	86	 
	 

	11.10 Counterparts; Integration; Effectiveness
	 	 	86	 
	 

	11.11 Survival of Representations and Warranties
	 	 	86	 
	 

	11.12 Severability
	 	 	86	 
	 

	11.13 Replacement of Lenders
	 	 	87	 
	 

	11.14 Governing Law; Jurisdiction; Etc.
	 	 	87	 
	 

	11.15 Waiver of Jury Trial
	 	 	88	 
	 

	11.16 No Advisory or Fiduciary Responsibility
	 	 	89	 
	 

	11.17 Electronic Execution of Assignments and Certain Other Documents
	 	 	89	 
	 

	11.18 USA PATRIOT Act
	 	 	89	 
	 

	11.19 Time of the Essence
	 	 	90	 






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	Section	 	Page
	11.20 California Judicial Reference
	 	 	90	 
	 

	11.21 Amendment and Restatement
	 	 	90	 






SCHEDULES




	 	 	 

	2.01

	 	Commitments and Applicable Percentages
	2.03

	 	Existing Letters of Credit
	5.17

	 	Subsidiaries; Equity Interests
	7.01

	 	Existing Indebtedness
	7.02

	 	Existing Liens
	11.02

	 	Administrative Agent’s Office; Certain Addresses for Notices






EXHIBITS




	 	 	 

	A

	 	Assignment and Assumption
	B

	 	Compliance Certificate
	C

	 	Loan Notice
	D

	 	Note






-vi-









 





THIRD AMENDED AND RESTATED CREDIT AGREEMENT




     This THIRD AMENDED AND RESTATED CREDIT AGREEMENT (“Agreement”) is entered into as of
May 4, 2010, among STATER BROS. MARKETS, a California corporation (the “Borrower”), STATER
BROS. HOLDINGS INC., a Delaware corporation (“Holdings”), each lender from time to time
party hereto (collectively, the “Lenders” and individually, a “Lender”), and BANK
OF AMERICA, N.A., as Administrative Agent and L/C Issuer.



RECITALS




     WHEREAS, the parties hereto have heretofore entered into the Second Amended and Restated
Credit Agreement dated as of April 16, 2007 (as heretofore amended, the “Existing Credit
Agreement”).



     WHEREAS, the Borrower has requested that the credit facilities established by the Existing
Credit Agreement be extended and the other terms thereof be amended, all as set forth herein.



     WHEREAS, the parties hereto desire to amend and restate the Existing Credit Agreement in its
entirety with this Agreement.



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



ARTICLE I

DEFINITIONS AND ACCOUNTING TERMS



1.01 Defined Terms. As used in this Agreement, the following terms shall have the meanings set
forth below:




     “Administrative Agent” means Bank of America in its capacity as administrative agent
under any of the Loan Documents, or any successor administrative agent.



     “Administrative Agent’s Office” means the Administrative Agent’s address and, as
appropriate, account as set forth on Schedule 11.02, or such other address or account as
the Administrative Agent may from time to time notify to the Borrower and the Lenders.



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



     “Affiliate” means, with respect to any Person, another Person that directly, or
indirectly through one or more intermediaries, Controls or is Controlled by or is under common
Control with the Person specified.



     “Aggregate Commitments” means the Commitments of all the Lenders. As of the Closing
Date, the Aggregate Commitments are $100,000,000.



     “Agreement” means this Credit Agreement.



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     “Applicable Percentage” means with respect to any Lender at any time, the percentage
(carried out to the ninth decimal place) of the Aggregate Commitments represented by such Lender’s
Commitment at such time. If the commitment of each Lender to make Loans and the obligation of the
L/C Issuer to make L/C Credit Extensions have been terminated pursuant to Section 9.02 or
if the Aggregate Commitments have expired, then the Applicable Percentage of each Lender shall be
determined based on the Applicable Percentage of such Lender most recently in effect, giving effect
to any subsequent assignments. The initial Applicable Percentage of each Lender is set forth
opposite the name of such Lender on Schedule 2.01 or in the Assignment and Assumption
pursuant to which such Lender becomes a party hereto, as applicable.



     “Applicable Rate” means a per annum rate equal to:




	 	(a)	 	with respect to Base Rate Loans, 1.00%;
	 
	 	(b)	 	with respect to Eurodollar Rate Loans, 1.75%;
	 
	 	(c)	 	with respect to the Commitment fees described in Section 2.08(a), 0.25%; and
	 
	 	(d)	 	with respect to standby Letters of Credit Fees, 1.25%.





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



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



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



     “Assignment and Assumption” means an assignment and assumption entered into by a
Lender and an assignee (with the consent of any party whose consent is required by
Section 11.06(b)), and accepted by the Administrative Agent, in substantially the form of
Exhibit A 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
Obligation, the capitalized 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.



     “Audited Financial Statements” means, collectively, (a) the audited consolidated
balance sheet of Holdings and its Subsidiaries for the Fiscal Year ended September, 2009 and the
related consolidated statements of income and cash flows for such Fiscal Year, and (b) the audited
consolidated balance sheet of Borrower and its Subsidiaries for the Fiscal Year ended
September, 2009 and the related consolidated statements of income and cash flows for such Fiscal
Year.



 - 2 - 









 





     “Availability Period” means the period from and including the Closing Date to the
earliest of (a) the Maturity Date, (b) the date of termination of the Aggregate Commitments
pursuant to Section 2.05, and (c) the date of termination of the commitment of each Lender
to make Loans and of the obligation of the L/C Issuer to make L/C Credit Extensions pursuant to
Section 9.02.



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



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



     “Base Rate Loan” means a Loan that bears interest based on the Base Rate.



     “Beneficial Owner” has the meaning assigned to such term in Rule 13d-3 and Rule 13d-5
under the Exchange Act, except that in calculating the beneficial ownership of any particular
“person” (as that term is used in Section 13(d)(3) of the Exchange Act), such “person” shall be
deemed to have beneficial ownership of all securities that such “person” has the right to acquire
by conversion or exercise of other securities, whether such right is currently exercisable or is
exercisable only after the passage of time or upon the occurrence of a subsequent condition. The
terms “Beneficially Owns” and “Beneficially Owned” shall have a corresponding meaning.



     “Borrower” has the meaning specified in the introductory paragraph hereto.



     “Borrower Materials” has the meaning specified in Section 6.02.



     “Borrowing” means a borrowing consisting of simultaneous Loans of the same Type and,
in the case of Eurodollar Rate Loans, having the same Interest Period made by each of the Lenders
pursuant to Section 2.01.



     “Business Day” means any day other than a Saturday, Sunday or other day on which
commercial banks are authorized to close under the Laws of, or are in fact closed in, the state of
California and, if such day relates to any Eurodollar Rate Loan, means any such day on which
dealings in Dollar deposits are conducted by and between banks in the London interbank eurodollar
market.



     “Cash Collateralize” has the meaning specified in Section 2.03(g).



     “Cash Management Agreement” means any agreement to provide cash management services,
including treasury, depository, overdraft, credit or debit card, electronic funds transfer and
other cash management arrangements.



 - 3 - 









 





     “Cash Management Bank” means any Person that, at the time it enters into a Cash
Management Agreement, is a Lender or an Affiliate of a Lender, in its capacity as a party to such
Cash Management Agreement. Bank of America and its Affiliates shall be considered Cash Management
Banks with respect to each Cash Management Agreement with the Borrower existing on the Closing
Date.



     “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.



     “Change of Control” means the occurrence of any of the following:




	 	(1)	 	the direct or indirect sale, transfer, conveyance or other disposition (other
than by way of merger or consolidation), in one or a series of related transactions, of
all or substantially all of the properties or assets of Holdings and its Subsidiaries
taken as a whole to any “person” or “group” of persons (as such terms are used in
Section 13(d)(3) of the Exchange Act) other than (A) any Permitted Holder, (B) La
Cadena or (C) any La Cadena Successor;
	 
	 	(2)	 	the adoption of a plan relating to the liquidation or dissolution of Holdings;
	 
	 	(3)	 	the consummation of any transaction (including, without limitation, any merger
or consolidation) the result of which is that any “person” or “group” (as defined
above), other than (A) any Permitted Holder, (B) La Cadena, or (C) any La Cadena
Successor, becomes the Beneficial Owner, directly or indirectly, or more than 50% of
the Voting Stock of Holdings, measured by voting power rather than number of shares;
	 
	 	(4)	 	the first day on which a majority of the members of the Board of Directors of
Holdings are not Continuing Directors;
	 
	 	(5)	 	Holdings consolidates with or merges with or into any Person, or any Person
consolidates with or merges with or into Holdings, in any such event pursuant to a
transaction in which any of the outstanding Voting Stock of Holdings or such other
Person is converted into or exchanged for cash, securities or other property, other
than any such transaction where all or a portion of the Voting Stock of Holdings
outstanding immediately prior to such transaction is converted into or exchanged for
Voting Stock (other than Disqualified Stock) of the surviving or transferee Person
constituting a majority of the outstanding shares of such Voting Stock of such
surviving or transferee Person (immediately after giving effect to such issuance); or
	 
	 	(6)	 	at any time prior to the date that a La Cadena Successor is the Beneficial
Owner of more than 50% of the Voting Stock of Holdings, Permitted Holders shall cease
to (A) have the power to vote the majority of the Equity Interests of La Cadena, (B) be
the Beneficial Owners of at least 35% of the Equity Interests in La Cadena, 




 - 4 - 









 






	 	 	 	or (C) be
the Beneficial Owners of a higher percentage of the Equity Interests in La Cadena than
any other “person” or “group” of persons (as such terms are used in Section 13(d)(3) of
the Exchange Act); or
	 
	 	(7)	 	Holdings at any time ceases to own 100% of the outstanding Voting Stock in
Borrower.





     “Closing Date” means the first date all the conditions precedent in Section
4.01 are satisfied or waived in accordance with Section 11.01.



     “Code” means the Internal Revenue Code of 1986.



     “Commitment” means, as to each Lender, its obligation to (a) make Loans to the
Borrower pursuant to Section 2.01, and (b) purchase participations in L/C Obligations, in
an aggregate principal amount at any one time outstanding not to exceed the amount set forth
opposite such Lender’s name on Schedule 2.01 or in the Assignment and Assumption pursuant
to which such Lender becomes a party hereto, as applicable, as such amount may be adjusted from
time to time in accordance with this Agreement.



     “Compliance Certificate” means a certificate substantially in the form of Exhibit
B.



     “Consolidated EBITDA” means, for any period, for Holdings and its Subsidiaries on a
consolidated basis, an amount equal to Consolidated Net Income for such period, plus
(a) Consolidated Interest Charges deducted in determining such Consolidated Net Income plus
(b) the amount of taxes, based on or measured by income, deducted in the determining such
Consolidated Net Income, plus (c) the amount of depreciation and amortization expense
deducted in determining such Consolidated Net Income, and minus (d) any extraordinary gains
included in determining such Consolidated Net Income.



     “Consolidated Interest Charges” means, for any period, for Holdings and its
Subsidiaries on a consolidated basis, the sum of (a) all interest, premium payments, fees, charges
and related expenses payable by Holdings and its Subsidiaries in connection with borrowed money
(including capitalized interest) or in connection with the deferred purchase price of assets, in
each case to the extent treated as interest in accordance with GAAP and (b) the portion of rent
payable by Holdings and its Subsidiaries with respect to such period under capital leases that is
treated as interest in accordance with GAAP.



     “Consolidated Net Income” means, for any period, for Holdings and its Subsidiaries on
a consolidated basis, the net income of Holdings and its Subsidiaries from continuing operations
after extraordinary items (excluding gains or losses from Dispositions of assets) for that period.



     “Continuing Directors” means, as of any date of determination, any member of the Board
of Directors of Holdings who:




	 	(1)	 	was a member of such Board of Directors on the Closing Date; or




 - 5 - 









 











     (2) was nominated for election or elected to such Board of Directors with the approval of a
majority of the Continuing Directors who were members of such Board at the time of such nomination
or election.



     “Contractual Obligation” means, as to any Person, any provision of any security issued
by such Person or of any agreement, instrument or other undertaking to which such Person is a party
or by which it or any of its property is bound.



     “Control” means the possession, directly or indirectly, of the power (a) to vote 10%
or more of the securities (on a fully diluted basis) of a Person having ordinary voting power for
the election of directors or managing general partners of such Person; or (b) to direct or cause
the direction of the management or policies of a Person, whether through the ability to exercise
voting power, by contract or otherwise. “Controlling” and “Controlled” have
meanings correlative thereto.



     “Credit Extension” means each of the following: (a) a Borrowing and (b) an L/C Credit
Extension.



     “Debtor Relief Laws” means the Bankruptcy Code of the United States, and all other
liquidation, conservatorship, bankruptcy, assignment for the benefit of creditors, moratorium,
rearrangement, receivership, insolvency, reorganization, or similar debtor relief Laws of the
United States or other applicable jurisdictions from time to time in effect and affecting the
rights of creditors generally.



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



     “Default Rate” means (a) when used with respect to Obligations other than Letter of
Credit Fees, an interest rate equal to (i) the Base Rate plus (ii) the Applicable Rate, if
any, applicable to Base Rate Loans plus (iii) 2% per annum; provided,
however, that with respect to a Eurodollar Rate Loan, the Default Rate shall be an interest
rate equal to the interest rate (including any Applicable Rate) otherwise applicable to such Loan
plus 2% per annum, and (b) when used with respect to Letter of Credit Fees, a rate equal to the
Applicable Rate plus 2% per annum.



     “Defaulting Lender” means any Lender that (a) has failed to fund any portion of the
Loans or participations in L/C Obligations required to be funded by it hereunder within one
Business Day of the date required to be funded by it hereunder unless such failure has been cured,
(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 the
subject of a good faith dispute or unless such failure has been cured, or (c) has been deemed
insolvent or become the subject of a bankruptcy or insolvency proceeding or a government seizure.



     “Development” means Stater Bros. Development, Inc., a California corporation that is a
Wholly-Owned Subsidiary of Holdings.



 - 6 - 









 





     “Disposition” or “Dispose” means the sale, transfer, license or other
disposition (including any sale and leaseback transaction) of any property by any Person, including
any sale, assignment, transfer or other disposal with or without recourse of any notes or accounts
receivable or any rights and claims associated therewith. For the avoidance of doubt, the issuance
by Borrower, its Subsidiaries or Development of a quit-claim deed, bill of sale or other
documentation confirming the prime-lessor’s ownership of a supermarket building upon completion of
construction thereof shall not be considered to be a “Disposition.”



     “Disqualified Stock” means any capital stock or other Equity Interest that, by its
terms (or by the terms of any security into which it is convertible, or for which it is
exchangeable, in each case at the option of the holder thereof), or upon the happening of any
event, matures or is mandatorily redeemable, pursuant to a sinking fund obligation or otherwise, or
redeemable at the option of the holder thereof, in whole or in part, on or prior to the date that
is 91 days after the date on which the Loans mature.



     “Dollar” and “$” mean lawful money of the United States.



     “Eligible Assignee” means any Person that meets the requirements to be an assignee
under Section 11.06(b)(iii), (v) and (vi) (subject to such consents, if
any, as may be required under Section 11.06(b)(iii)).



     “Environmental Laws” means any and all Federal, state, local, and foreign statutes,
laws, regulations, ordinances, rules, judgments, orders, decrees, permits, concessions, grants,
franchises, licenses, agreements or governmental restrictions relating to pollution and the
protection of the environment or the release of any materials into the environment, including those
related to hazardous substances or wastes, air emissions and discharges to waste or public systems.



     “Environmental Liability” means any liability, contingent or otherwise (including any
liability for damages, costs of environmental remediation, fines, penalties or indemnities), of the
Borrower, any other Loan Party or any of their respective Subsidiaries directly or indirectly
resulting from or based upon (a) violation of any Environmental Law, (b) the generation, use,
handling, transportation, storage, treatment or disposal of any Hazardous Materials, (c) exposure
to any Hazardous Materials, (d) the release or threatened release of any Hazardous Materials into
the environment or (e) any contract, agreement or other consensual arrangement pursuant to which
liability is assumed or imposed with respect to any of the foregoing.



     “Equity Interests” means, with respect to any Person, all of the shares of capital
stock of (or other ownership or profit interests in) such Person, all of the warrants, options or
other rights for the purchase or acquisition from such Person of shares of capital stock of (or
other ownership or profit interests in) such Person, all of the securities convertible into or
exchangeable for shares of capital stock of (or other ownership or profit interests in) such Person
or warrants, rights or options for the purchase or acquisition from such Person of such shares (or
such other interests), and all of the other ownership or profit interests in such Person (including
partnership, member or trust interests therein), whether voting or nonvoting, and whether or not
such shares, warrants, options, rights or other interests are outstanding on any date of
determination.



 - 7 - 









 





     “ERISA” means the Employee Retirement Income Security Act of 1974.



     “ERISA Affiliate” means any trade or business (whether or not incorporated) under
common control with the Borrower within the meaning of Sections 414(b) or (c) of the Code (and
Sections 414(m) and (o) of the Code for purposes of provisions relating to Section 412 of the
Code).



     “ERISA Event” means (a) a Reportable Event with respect to a Pension Plan; (b) a
withdrawal by the Borrower or any ERISA Affiliate from a Pension Plan subject to Section 4063 of
ERISA during a plan year in which it was a substantial employer (as defined in Section 4001(a)(2)
of ERISA) or a cessation of operations that is treated as such a withdrawal under Section 4062(e)
of ERISA; (c) a complete or partial withdrawal by the Borrower or any ERISA Affiliate from a
Multiemployer Plan or notification that a Multiemployer Plan is in reorganization; (d) the filing
of a notice of intent to terminate, the treatment of a Plan amendment as a termination under
Sections 4041 or 4041A of ERISA, or the commencement of proceedings by the PBGC to terminate a
Pension Plan or Multiemployer Plan; (e) an event or condition which might reasonably be expected to
constitute grounds under Section 4042 of ERISA for the termination of, or the appointment of a
trustee to administer, any Pension Plan or Multiemployer Plan; (f) the determination that any
Pension Plan is considered an at-risk plan or a plan in endangered or critical status within the
meaning of Sections 430, 431 and 432 of the Code or Sections 303, 304 and 305 of ERISA; or (g) the
imposition of any liability under Title IV of ERISA, other than for PBGC premiums due but not
delinquent under Section 4007 of ERISA, upon the Borrower or any ERISA Affiliate.



     “Eurodollar Base Rate” has the meaning specified in the definition of Eurodollar Rate.



     “Eurodollar Rate” means for any Interest Period with respect to a Eurodollar Rate
Loan, a rate per annum determined by the Administrative Agent pursuant to the following formula:



	 	 	 	 	 	 	 

	Eurodollar Rate

	 	=
	 	Eurodollar Base Rate     

1.00 – Eurodollar Reserve Percentage
	 	 






          Where,




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



 - 8 - 









 







their request at approximately 11:00 a.m. (London time) two Business Days prior to the
commencement of such Interest Period.




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



     “Eurodollar Rate Loan” means a Loan that bears interest at a rate based on the
Eurodollar Rate.



     “Event of Default” has the meaning specified in Section 9.01.



     “Exchange Act” means the Securities Exchange Act of 1934, as amended from time to
time.



     “Excluded Taxes” means, with respect to the Administrative Agent, any Lender, the L/C
Issuer 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, (c) any backup withholding
tax that is required by the Code to be withheld from amounts payable to a Lender that has failed to
comply with clause (A) of Section 3.01(e)(ii), and (d) in the case of a Foreign Lender
(other than an assignee pursuant to a request by the Borrower under Section 11.13), any
United States withholding tax that (i) is required to be imposed on amounts payable to such Foreign
Lender pursuant to the Laws in force at the time such Foreign Lender becomes a party hereto (or
designates a new Lending Office) or (ii) is attributable to such Foreign Lender’s failure or
inability (other than as a result of a Change in Law) to comply with clause (B) of
Section 3.01(e)(ii), 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
3.01(a)(ii).



     “Existing Credit Agreement” has the meaning set forth in the recitals to this
Agreement.



     “Existing Fixed Rate Senior Notes” means the $525,000,000 aggregate principal amount
of 8.125% fixed rate Senior Notes due 2012 issued pursuant to the Existing Indenture.



     “Existing Indenture” means the Indenture dated as of June 17, 2004, among Holdings,
the guarantors party thereto and The Bank of New York, as Trustee as amended from time to time to
the extent permitted under Section 8.05.



 - 9 - 









 





     “Existing Letter of Credit” means each Letter of Credit (as defined in the Existing
Credit Agreement) outstanding on the Closing Date that has not expired or been cancelled as of the
Closing Date, including, without limitation, the Letters of Credit listed on Schedule 2.03.



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



     “Fee Letter” means the letter agreement of even date herewith, between the Borrower
and Bank of America.



     “Financial Plan” has the meaning set forth in Section 6.01(c).



     “Fiscal Quarter” means any of the fiscal quarters ending on or about each December 31,
March 31, June 30 and September 30.



     “Fiscal Year” means the fiscal year of Holdings ending on or about September 30.



     “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 (including such a Lender when
acting in the capacity of the L/C Issuer). For purposes of this definition, the United States,
each State thereof and the District of Columbia shall be deemed to constitute a single
jurisdiction.



     “FRB” means the Board of Governors of the Federal Reserve System of the United States.



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



     “GAAP” means generally accepted accounting principles in the United States set forth
in the opinions and pronouncements of the Accounting Principles Board and the American Institute of
Certified Public Accountants and statements and pronouncements of the Financial Accounting
Standards Board or such other principles as may be approved by a significant segment of the
accounting profession in the United States, that are applicable to the circumstances as of the date
of determination, consistently applied.



     “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



 - 10 - 









 




government (including any supra-national bodies such as the European Union or the European
Central Bank).




     “Guarantee” means, as to any Person, (a) any obligation, contingent or otherwise, of
such Person guaranteeing or having the economic effect of guaranteeing any Indebtedness or other
obligation payable or performable by another Person (the “primary obligor”) in any manner, whether
directly or indirectly, and including any obligation of such Person, direct or indirect, (i) to
purchase or pay (or advance or supply funds for the purchase or payment of) such Indebtedness or
other obligation, (ii) to purchase or lease property, securities or services for the purpose of
assuring the obligee in respect of such Indebtedness or other obligation of the payment or
performance of such Indebtedness or other obligation, (iii) to maintain working capital, equity
capital or any other financial statement condition or liquidity or level of income or cash flow of
the primary obligor so as to enable the primary obligor to pay such Indebtedness or other
obligation, or (iv) entered into for the purpose of assuring in any other manner the obligee in
respect of such Indebtedness or other obligation of the payment or performance thereof or to
protect such obligee against loss in respect thereof (in whole or in part), or (b) any Lien on any
assets of such Person securing any Indebtedness or other obligation of any other Person, whether or
not such Indebtedness or other obligation is assumed by such Person (or any right, contingent or
otherwise, of any holder of such Indebtedness to obtain any such Lien). The amount of any
Guarantee shall be deemed to be an amount equal to the stated or determinable amount of the related
primary obligation, or portion thereof, in respect of which such Guarantee is made or, if not
stated or determinable, the maximum reasonably anticipated liability in respect thereof as
determined by the guaranteeing Person in good faith. The term “Guarantee” as a verb has a
corresponding meaning.



     “Guaranties” means, collectively, the guaranties of the Obligations executed on the
Closing Date by Holdings, Development and Super Rx, and each other guaranty of the Obligations
which is hereafter executed by any Material Subsidiary of Holdings or the Borrower pursuant to
Section 6.14.



     “Guarantor” means, (a) Holdings, Development and Super Rx, and (b) each other Material
Subsidiary of Holdings or Borrower that hereafter becomes a party to a Guaranty pursuant to
Section 6.14; in each case, until such Person is released from its Guaranty pursuant to the
terms of this Agreement.



     “Hazardous Materials” means all explosive or radioactive substances or wastes and all
hazardous or toxic substances, wastes or other pollutants, including petroleum or petroleum
distillates, asbestos or asbestos-containing materials, polychlorinated biphenyls, radon gas,
infectious or medical wastes and all other substances or wastes of any nature regulated pursuant to
any Environmental Law.



     “Hedge Bank” means any Person that, at the time it enters into a Swap Contract
permitted under this Agreement, is a Lender or an Affiliate of a Lender, in its capacity as a party
to such Swap Contract. Bank of America and its Affiliates shall be considered Hedge Banks with
respect to each Swap Contract with the Borrower existing on the Closing Date.



     “Holdings” has the meaning specified in the introductory paragraph hereto.



 - 11 - 









 





     “Impacted Lender” means any Lender (a) which is a Defaulting Lender, (b) which has, or
as to which Administrative Agent has a good faith belief that such Lender has, defaulted in
fulfilling any one or more of its obligations under any one or more syndicated credit facilities
(other than the facilities provided pursuant to this Agreement) or as to which the Administrative
Agent has a good faith belief that such Lender is at a material risk of not fulfilling its
obligations under this Agreement, or (c) that is Controlled by a Person which (i) has been deemed
insolvent or become subject to a bankruptcy or insolvency proceeding or a government seizure or
(ii) would qualify as an Impacted Lender under clause (b) of this definition.



     “Indebtedness” means, as to any Person at a particular time, without duplication, all
of the following, whether or not included as indebtedness or liabilities in accordance with GAAP:




     (a) all obligations of such Person for borrowed money and all obligations of such
Person evidenced by bonds, debentures, notes, loan agreements or other similar instruments;




     (b) all direct or contingent obligations of such Person arising under letters of credit
(including standby and commercial), bankers’ acceptances, bank guaranties, surety bonds and
similar instruments;




     (c) net obligations of such Person under any Swap Contract;




     (d) all obligations of such Person to pay the deferred purchase price of property or
services (other than trade accounts payable in the ordinary course of business in accordance
with customary trade terms and, in each case, not overdue for a period of more than 60
days);




     (e) indebtedness (excluding prepaid interest thereon) secured by a Lien on property
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;




     (f) capital leases and Synthetic Lease Obligations;




     (g) all obligations of such Person to purchase, redeem, retire, defease or otherwise
make any payment in respect of any Equity Interest in such Person or any other Person,
valued, in the case of a redeemable preferred interest, at the greater of its voluntary or
involuntary liquidation preference plus accrued and unpaid dividends; and




     (h) all Guarantees of such Person in respect of any of the foregoing;




provided, however, that the “Indebtedness” of Holdings and its Subsidiaries
shall not include (1) any payment, account, credit, award or other obligation pursuant to
the Phantom Stock Plan and (2) payables incurred in connection with the Borrower’s
distribution facilities in San Bernardino, California as described in the final offering
memoranda for the New Fixed Rate Senior Notes.




 - 12 - 











 





     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 under
any Swap Contract on any date shall be deemed to be the Swap Termination Value thereof as of such
date. The amount of any capital lease or Synthetic Lease Obligation as of any date shall be deemed
to be the amount of Attributable Indebtedness in respect thereof as of such date.



     “Indemnified Taxes” means Taxes other than Excluded Taxes.



     “Indemnitees” has the meaning specified in Section 11.04(b).



     “Information” has the meaning specified in Section 11.07.



     “Interest Payment Date” means, (a) as to any Base Rate Loan, the first Business Day of
each calendar month; (b) as to any Eurodollar Rate Loan, the first Business Day of each calendar
month, the last day of the relevant Interest Period and any date that such Loan is prepaid in whole
or in part; and (c) as to all Loans, the Maturity Date or any earlier date upon which the Aggregate
Commitments are terminated in accordance with the terms of this Agreement; provided,
further, that interest accruing at the Default Rate shall be payable from time to time at any time
upon demand of Administrative Agent.



     “Interest Period” means, as to each Eurodollar Rate Loan, the period commencing on the
date such Eurodollar Rate Loan is disbursed or converted to or continued as a Eurodollar Rate Loan
and ending on the date one, two, three or six months thereafter, as selected by the Borrower in its
Loan Notice; provided that:




     (i) any Interest Period that would otherwise end on a day that is not a Business Day
shall be extended to the next succeeding Business Day unless such Business Day falls in
another calendar month, in which case such Interest Period shall end on the next preceding
Business Day;




     (ii) any Interest Period 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 calendar month at the
end of such Interest Period; and




     (iii) no Interest Period shall extend beyond the Maturity Date.



     “Investment” means, as to any Person, any direct or indirect acquisition or investment
by such Person, whether by means of (a) the purchase or other acquisition of capital stock or other
securities of another Person, (b) a loan, advance or capital contribution to, Guarantee or
assumption of debt of, or purchase or other acquisition of any other debt or equity participation
or interest in, another Person, including any partnership or joint venture interest in such other
Person and any arrangement pursuant to which the investor Guarantees Indebtedness of such other
Person, or (c) the purchase or other acquisition (in one transaction or a series of transactions)
of assets of another Person that constitute a business unit. For purposes of covenant compliance,
the amount of any Investment shall be the amount actually invested, without



-13-









 




adjustment for subsequent increases or decreases in the value of such Investment. For the
avoidance of doubt, the issuance by Borrower, its Subsidiaries or Development of a quit-claim deed,
bill of sale or other documentation confirming the prime-lessor’s ownership of a supermarket
building upon completion of construction thereof shall not be considered to be an “Investment.”




     “IRS” means the United States Internal Revenue Service.



     “ISP” means, with respect to any Letter of Credit, the “International Standby
Practices 1998” published by the Institute of International Banking Law & Practice, Inc. (or such
later version thereof as may be in effect at the time of issuance).



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



     “La Cadena” means La Cadena Investments, a California general partnership.



     “La Cadena Successor” means a partnership or limited liability company other than La
Cadena with respect to which (a) a Permitted Holder is a general partner or managing member, (b)
Permitted Holders have the power to vote the majority of the Equity Interests, (c) Permitted
Holders are the Beneficial Owners of at least 35% of the Equity Interests therein, and (d)
Permitted Holders are the Beneficial Owners of a higher percentage of the Equity Interests than any
other “person” or “group” of persons (as such terms are used in Section 13(d) of the Exchange Act).



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



     “L/C Advance” means, with respect to each Lender, such Lender’s funding of its
participation in any L/C Borrowing in accordance with its Applicable Percentage.



     “L/C Borrowing” means an extension of credit resulting from a drawing under any Letter
of Credit which has not been reimbursed on the date when made or refinanced as a Borrowing.



     “L/C Credit Extension” means, with respect to any Letter of Credit, the issuance
thereof or extension of the expiry date thereof, or the increase of the amount thereof.



     “L/C Issuer” means Bank of America in its capacity as issuer of Letters of Credit
hereunder, or any successor issuer of Letters of Credit hereunder.



-14-









 





     “L/C Obligations” means, as at any date of determination, the aggregate amount
available to be drawn under all outstanding Letters of Credit plus the aggregate of all
Unreimbursed Amounts, including all L/C Borrowings. For purposes of computing the amount available
to be drawn under any Letter of Credit, the amount of such Letter of Credit shall be determined in
accordance with Section 1.06. For all purposes of this Agreement, if on any date of
determination a Letter of Credit has expired by its terms but any amount may still be drawn
thereunder by reason of the operation of Rule 3.14 of the ISP, such Letter of Credit shall be
deemed to be “outstanding” in the amount so remaining available to be drawn.



     “Lender” has the meaning specified in the introductory paragraph hereto.



     “Lender Cash Management Agreement” means any Cash Management Agreement that is entered
into by and between the Borrower and any Cash Management Bank.



     “Lender Hedge Agreement” means any Swap Contract permitted under this Agreement that
is entered into by and between the Borrower and any Hedge Bank.



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



     “Letter of Credit” means any letter of credit issued hereunder and shall include the
Existing Letters of Credit. A Letter of Credit may be a commercial letter of credit or a standby
letter of credit.



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



     “Letter of Credit Expiration Date” means the day that is one calendar year after the
Maturity Date then in effect (or, if such day is not a Business Day, the next preceding Business
Day).



     “Letter of Credit Fee” has the meaning specified in Section 2.03(i).



     “Lien” means any mortgage, pledge, hypothecation, assignment, deposit arrangement,
encumbrance, lien (statutory or other), charge, or preference, priority or other security interest
or preferential arrangement in the nature of a security interest of any kind or nature whatsoever
(including any conditional sale or other title retention agreement, any easement, right of way or
other encumbrance on title to real property, and any financing lease having substantially the same
economic effect as any of the foregoing).



     “Loan” has the meaning specified in Section 2.01.



     “Loan Documents” means this Agreement, each Note, each Issuer Document, the Fee
Letter, and the Guaranties.



-15-









 





     “Loan Notice” means a notice of (a) a Borrowing, (b) a conversion of Loans from one
Type to the other, or (c) a continuation of Eurodollar Rate Loans, pursuant to Section
2.02(a), which, if in writing, shall be substantially in the form of Exhibit C.



     “Loan Parties” means, collectively, the Borrower, Holdings and each other Guarantor.



     “Material Adverse Effect” means (a) a material adverse change in, or a material
adverse effect upon, the operations, business, properties, liabilities (actual or contingent),
condition (financial or otherwise) or prospects of Holdings, the Borrower or the Loan Parties,
individually or taken as a whole; (b) a material impairment of the ability of any Loan Party to
perform its obligations under any Loan Document to which it is a party; or (c) a material adverse
effect upon the legality, validity, binding effect or enforceability against any Loan Party of any
Loan Document to which it is a party.



     “Material Subsidiary” means each Subsidiary of Holdings or Borrower which at any time
has assets having an aggregate fair market value, as reasonably determined by Holdings or Borrower,
which is in excess of $10,000,000.



     “Maturity Date” means April 1, 2013; provided, however, that if such
date is not a Business Day, the Maturity Date shall be the next preceding Business Day.



     “Moseley Trusts” means, collectively, the Marital Trust created under the Moseley
Family Revocable Trust dated May 18, 2000 and the Survivor’s Trust created under the Moseley Family
Revocable Trust dated May 18, 2000.



     “Multiemployer Plan” means any employee benefit plan of the type described in
Section 4001(a)(3) of ERISA, to which the Borrower or any ERISA Affiliate makes or is obligated to
make contributions, or during the preceding five plan years, has made or been obligated to make
contributions.



     “Negative Pledge” means a Contractual Obligation that restricts Liens on property.



     “New Fixed Rate Senior Notes” means the $285,000,000 aggregate principal amount of 7
3/4% fixed rate Senior Notes due 2015 issued pursuant to the New Indenture.



     “New Indenture” means the Indenture dated as of April 18, 2007, among Holdings, the
guarantors party thereto and The Bank of New York Trust Company, N.A., as Trustee as amended from
time to time to the extent permitted under Section 8.05.



     “Note” means a promissory note made by the Borrower in favor of a Lender evidencing
Loans made by such Lender, substantially in the form of Exhibit D.



     “Obligations” means all advances to, and debts, liabilities, obligations, covenants
and duties of, any Loan Party arising under any Loan Document or otherwise with respect to any
Loan, Letter of Credit, Lender Cash Management Agreement or Lender Hedge Agreement, in each case
whether direct or indirect (including those acquired by assumption), absolute or contingent, due or
to become due, now existing or hereafter arising and including interest and fees that accrue after
the commencement by or against any Loan Party or any Affiliate thereof of



-16-









 




any proceeding under any Debtor Relief Laws naming such Person as the debtor in such
proceeding, regardless of whether such interest and fees are allowed claims in such proceeding.




     “Ordinary Course Dispositions” means:




(a) Dispositions of obsolete or worn out property, whether now owned or hereafter acquired,
in the ordinary course of business;




(b) Dispositions of cash, cash equivalents, inventory and other property in the ordinary
course of business, other than stores and any inventory or other property Disposed of in
connection with the Disposition of any stores; and




(c) Dispositions of assets or property by any Subsidiary of Borrower to Borrower or a
Wholly-Owned Subsidiary of Borrower; provided that, if the Subsidiary Disposing of
such assets or property is a Guarantor, such Disposition of assets or property must be made
to the Borrower or to another Guarantor;




provided, however, that no such Disposition shall be for less than the fair
market value of the property being disposed of.



     “Ordinary Course Indebtedness” means:




(a) Indebtedness under the Loan Documents;




(b) intercompany Guarantees of Borrower or any of its Subsidiaries guarantying Indebtedness
otherwise permitted hereunder of Borrower or any Wholly-Owned Subsidiary of Borrower that is
a Guarantor; and




(c) Indebtedness arising from the honoring of a check, draft or similar instrument against
insufficient funds.




“Ordinary Course Investments” means:




(a) Investments consisting of cash and cash equivalents;




(b) Investments of Borrower in any of its Subsidiaries and Investments of any Subsidiary of
Borrower in Borrower or another Subsidiary of Borrower;




(c) Investments consisting of or evidencing the extension of credit to customers or
suppliers of Borrower and its Subsidiaries in the ordinary course of business and any
Investments received in satisfaction or partial satisfaction thereof; and




(d) Investments consisting of Guarantees permitted by Section 7.01.



     “Ordinary Course Liens” means:




(a) Liens pursuant to any Loan Document;



-17-









 






(b) Liens for taxes not yet due or which are being contested in good faith and by
appropriate proceedings, if adequate reserves with respect thereto are maintained on the
books of the applicable Person in accordance with GAAP;




(c) carriers’, warehousemen’s, mechanics’, materialmen’s, repairmen’s or other like Liens
arising in the ordinary course of business which are not overdue for a period of more than
30 days or which are being contested in good faith and by appropriate proceedings, if
adequate reserves with respect thereto are maintained on the books of the applicable Person;




(d) pledges or deposits in connection with worker’s compensation, unemployment insurance and
other social security legislation;




(e) deposits to secure the performance of bids, trade contracts (other than for borrowed
money), leases, statutory obligations, surety and appeal bonds, performance bonds and other
obligations of a like nature incurred in the ordinary course of business;




(f) Liens on deposits made in the ordinary course of business and Liens in favor of
collecting banks having a right of setoff, revocation, refund or chargeback with respect to
money or instruments of Borrower or any Subsidiary on deposit with or in possession of such
banks;




(g) easements, rights-of-way, restrictions and other similar encumbrances affecting real
property which, in the aggregate, are not substantial in amount, and which do not in any
case materially detract from the value of the property subject thereto or materially
interfere with the ordinary conduct of the business of any Person;




(h) Liens arising from UCC financing statements filed solely with respect to leases
permitted by this Agreement; and




(i) any attachment, judgment or other similar Lien arising in connection with litigation or
other legal proceedings (and not otherwise a Default hereunder) in the ordinary course of
business that is currently being contested in good faith by appropriate proceedings,
provided that adequate reserves have been set aside with respect to such Liens, no material
property is subject to a material risk of loss or forfeiture in connection with such Liens
and the claims in respect of such Liens are fully covered by insurance (subject to ordinary
and customary deductibles).



     “Organization Documents” means, (a) with respect to any corporation, the certificate
or articles of incorporation and the bylaws (or equivalent or comparable constitutive documents
with respect to any non-U.S. jurisdiction); (b) with respect to any limited liability company, the
certificate or articles of formation or organization and operating agreement; and (c) with respect
to any partnership, joint venture, trust or other form of business entity, the partnership, joint
venture or other applicable agreement of formation or organization and any agreement, instrument,
filing or notice with respect thereto filed in connection with its formation or organization with
the applicable Governmental Authority in the jurisdiction of its formation or organization and, if
applicable, any certificate or articles of formation or organization of such entity.



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     “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.



     “Outstanding Amount” means (i) with respect to Loans on any date, the aggregate
outstanding principal amount thereof after giving effect to any borrowings and prepayments or
repayments of Loans occurring on such date; and (ii) with respect to any L/C Obligations on any
date, the amount of such L/C Obligations on such date after giving effect to any L/C Credit
Extension occurring on such date and any other changes in the aggregate amount of the L/C
Obligations as of such date, including as a result of any reimbursements by the Borrower of
Unreimbursed Amounts.



     “Participant” has the meaning specified in Section 11.06(d).



     “PBGC” means the Pension Benefit Guaranty Corporation.



     “Pension Act” means the Pension Protection Act of 2006.



     “Pension Funding Rules” means the rules of the Code and ERISA regarding minimum
required contributions (including any installment payment thereof) to Pension Plans and set forth
in, with respect to plan years ending prior to the effective date of the Pension Act, Section 412
of the Code and Section 302 of ERISA, each as in effect prior to the Pension Act and, thereafter,
Section 412, 430, 431, 432 and 436 of the Code and Sections 302, 303, 304 and 305 of ERISA.



     “Pension Plan” means any “employee pension benefit plan” (as such term is defined in
Section 3(2) of ERISA), other than a Multiemployer Plan, that is subject to Title IV of ERISA and
is sponsored or maintained by the Borrower or any ERISA Affiliate or to which the Borrower or any
ERISA Affiliate contributes or has an obligation to contribute, or in the case of a multiple
employer or other plan described in Section 4064(a) of ERISA, has made contributions at any time
during the immediately preceding five plan years.



     “Permitted Holders” means (a) Jack H. Brown and his spouse and immediate family
members, (b) any trust, corporation, partnership or other entity, the beneficial interests of which
are owned exclusively by the Persons referred to in clause (a), and (c) any trustee, executor or
receiver appointed to manage or administer the assets of any Person referred to in clause (a)
following the death or incapacity of such Person and the heirs of any such Person referred to in
clause (a).



     “Permitted Tax Distributions” means, for or in respect of any Fiscal Year or other tax
period of the Borrower (each a “Tax Period”), a distribution by the Borrower to Holdings,
in an amount equal to the product of (x) the amount of taxable income or gain of Borrower for such
Tax Period multiplied by (y) the Tax Rate with respect to each such amount.



     “Permitted Workers Compensation Letters of Credit” means standby Letters of Credit
issued to secure workers’ compensation and other insurance coverages for Borrower and its
Subsidiaries not to exceed the minimum amount required by Holdings’, Borrower’s, or any of
Borrower’s Subsidiaries’ insurance carriers or applicable regulatory agencies.



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



     “Phantom Stock Plan” means, collectively, the Stater Bros. Holdings Inc. Phantom Stock
Plan effective as of June 27, 2000 and any related documents or instruments executed or to be
executed in connection therewith (including, without limitation, any Phantom Stock Award Agreement
thereunder), in each case as amended, modified, renewed, or replaced from time with the exception
of any amendment, modification, renewal or replacement that would expand the definition of
“Eligible Employee” thereunder to include any shareholder of Holdings or any partner in La Cadena.



     “Plan” means any “employee benefit plan” (as such term is defined in Section 3(3) of
ERISA) established by any Loan Party or, with respect to any such plan that is subject to Section
412 of the Code or Title IV of ERISA, any ERISA Affiliate.



     “Platform” has the meaning specified in Section 6.02.



     “Public Lender” has the meaning specified in Section 6.02.



     “Quarterly Payment Date” means the last Business Day of each March, June, September
and December.



     “Register” has the meaning specified in Section 11.06(c).



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



     “Reportable Event” means any of the events set forth in Section 4043(c) of ERISA,
other than events for which the 30 day notice period has been waived.



     “Request for Credit Extension” means (a) with respect to a Borrowing, conversion or
continuation of Loans, a Loan Notice, and (b) with respect to an L/C Credit Extension, a Letter of
Credit Application.



     “Required Lenders” means, as of any date of determination, Lenders having more than
50% of the Aggregate Commitments or, if the commitment of each Lender to make Loans and the
obligation of the L/C Issuer to make L/C Credit Extensions have been terminated pursuant to
Section 9.02, Lenders holding in the aggregate more than 50% of the Total Outstandings
(with the aggregate amount of each Lender’s risk participation and funded participation in L/C
Obligations being deemed “held” by such Lender for purposes of this definition); provided
that the Commitment of, and the portion of the Total Outstandings 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, secretary, treasurer, assistant treasurer or controller of a Loan Party. Any document
delivered hereunder that is signed by a Responsible Officer of a Loan Party shall be conclusively
presumed



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to have been authorized by all necessary corporate, partnership and/or other action on the
part of such Loan Party and such Responsible Officer shall be conclusively presumed to have acted
on behalf of such Loan Party.




     “Restricted Payment” means:




(a) the declaration or payment of any dividend or distribution by Holdings or any of its
Subsidiaries, either in cash or property, on any shares of the capital stock of any class or
other Equity Interest of Holdings or any of its Subsidiaries (except dividends or other
distributions payable solely in shares of capital stock of Holdings or any of its
Subsidiaries and dividends or other distributions payable (including dividends payable in
cash) by a Subsidiary to Borrower or another Wholly-Owned Subsidiary of Holdings that is a
Guarantor);




(b) the purchase, redemption or retirement by Holdings or any of its Subsidiaries of any
shares of any class of the capital stock of Holdings or any of its Subsidiaries or any
warrants, rights or options to purchase or acquire any shares of any class of the capital
stock of Holdings or any of its Subsidiaries whether directly or indirectly;




(c) any other payment or distribution by Holdings or any of its Subsidiaries in respect of
any class of capital stock of Holdings or any of its Subsidiaries, either directly or
indirectly (except dividends or other distributions payable solely in shares of capital
stock of Holdings or any of its Subsidiaries and dividends or other distributions payable
(including dividends payable in cash) by a Subsidiary to Borrower or another Wholly-Owned
Subsidiary of Holdings that is a Guarantor);




(d) any Investment other than an Investment otherwise permitted under any Loan Document; and




(e) the prepayment, repayment, redemption, defeasance or other acquisition or retirement for
value prior to any scheduled maturity, scheduled repayment or scheduled sinking fund payment
of any of the Senior Notes;




provided however that any payment, account, credit, award or other obligations
pursuant to the Phantom Stock Plan shall not be considered to be a “Restricted Payment.”



     “SEC” means the Securities and Exchange Commission, or any Governmental Authority
succeeding to any of its principal functions.



     “Senior Note Documents” means, collectively, (a) the Senior Note Indentures, (b) the
Senior Notes and (c) each guarantee thereof executed by any Subsidiary of Holdings.



     “Senior Note Indentures” means, collectively, the Existing Indenture and the New
Indenture.



     “Senior Notes” means, collectively, the Existing Fixed Rate Senior Notes and the New
Fixed Rate Senior Notes.



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     “Shareholders’ Equity” means, as of any date of determination, consolidated
shareholders’ equity (or deficit) of Holdings and its Subsidiaries as of that date determined in
accordance with GAAP.



     “Subsidiary” of a Person means a corporation, partnership, joint venture, limited
liability company or other business entity of which a majority of the shares of securities or other
interests having ordinary voting power for the election of directors or other governing body (other
than securities or interests having such power only by reason of the happening of a contingency)
are at the time beneficially owned, or the management of which is otherwise controlled, directly,
or indirectly through one or more intermediaries, or both, by such Person. Unless otherwise
specified, all references herein to a “Subsidiary” or to “Subsidiaries” shall refer to a Subsidiary
or Subsidiaries of the Borrower.



     “Super Rx” means Super Rx, Inc., a California corporation.



     “Swap Contract” means (a) any and all rate swap transactions, basis swaps, credit
derivative transactions, forward rate transactions, commodity swaps, commodity options, forward
commodity contracts, equity or equity index swaps or options, bond or bond price or bond index
swaps or options or forward bond or forward bond price or forward bond index transactions, interest
rate options, forward foreign exchange transactions, cap transactions, floor transactions, collar
transactions, currency swap transactions, cross-currency rate swap transactions, currency options,
spot contracts, or any other similar transactions or any combination of any of the foregoing
(including any options to enter into any of the foregoing), whether or not any such transaction is
governed by or subject to any master agreement, and (b) any and all transactions of any kind, and
the related confirmations, which are subject to the terms and conditions of, or governed by, any
form of master agreement published by the International Swaps and Derivatives Association, Inc.,
any International Foreign Exchange Master Agreement, or any other master agreement (any such master
agreement, together with any related schedules, a “Master Agreement”), including any such
obligations or liabilities under any Master Agreement.



     “Swap Termination Value” means, in respect of any one or more Swap Contracts, after
taking into account the effect of any legally enforceable netting agreement relating to such Swap
Contracts, (a) for any date on or after the date such Swap Contracts 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 Swap Contracts, as determined based upon one or more mid-market or other readily
available quotations provided by any recognized dealer in such Swap Contracts (which may include a
Lender or any Affiliate of a Lender).



     “Synthetic Lease Obligation” means the monetary obligation of a Person under (a) a
so-called synthetic, off-balance sheet or tax retention lease, or (b) an agreement for the use or
possession of property creating obligations that do not appear on the balance sheet of such Person
but which, upon the insolvency or bankruptcy of such Person, would be characterized as the
indebtedness of such Person (without regard to accounting treatment).



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     “Tax Rate” means, for or in respect of any Tax Period (as defined in the definition of
“Permitted Tax Distribution”) and any item of income, the combined United States federal and
California state income tax rate applicable during such Tax Period to such item of income if
included as taxable income by a corporation doing business in California.



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



     “Total Outstandings” means the aggregate Outstanding Amount of all Loans and all L/C
Obligations.



     “Type” means, with respect to a Loan, its character as a Base Rate Loan or a
Eurodollar Rate Loan.



     “Unfunded Pension Liability” means, with respect to any Pension Plan at any time, the
excess (if any) of (i) the present value of projected benefit obligations based upon the actuarial
assumptions used for accounting purposes (i.e., used in preparing the plan sponsor’s financial
statements in accordance with FASB Statement No. 87 and 158, and related amendments), over (ii) the
fair market value of all Pension Plan assets.



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



     “Unreimbursed Amount” has the meaning specified in Section 2.03(c)(i).



     “Voting Stock” of any Person as of any date means the capital stock or other Equity
Interests of such Person that is at the time entitled to vote in the election of the Board of
Directors or other similar management body of such Person.



     “Wholly-Owned Subsidiary” of any specified Person means any Subsidiary of such Person
all the outstanding shares of capital stock and other Equity Interests (other than directors’
qualifying shares, if applicable) of which are owned directly by such Person or another
Wholly-Owned Subsidiary of such Person, provided that Borrower shall be considered a
Wholly-Owned Subsidiary of Holdings so long as Holdings owns all of the outstanding shares of
Voting Stock of Borrower.



     1.02 Other Interpretive 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. Whenever the context may require, any pronoun shall include the corresponding
masculine, feminine and neuter forms. The words “include,” “includes” and
“including” shall be deemed to be followed by the phrase “without limitation.” The word
“will” shall be construed to have the same meaning and effect as the word
“shall.” Unless the context requires otherwise, (i) any definition of or reference to
any agreement, instrument or other document (including any Organization Document) 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



-23-









 







modifications
set forth herein or in any other Loan Document), (ii) any reference herein to any Person shall be
construed to include such Person’s successors and assigns, (iii) the words “herein,”
“hereof” and “hereunder,” and words of similar import when used in any Loan
Document, shall be construed to refer to such Loan Document in its entirety and not to any
particular provision thereof, (iv) all references in a Loan Document to Articles, Sections,
Exhibits and Schedules shall be construed to refer to Articles and Sections of, and Exhibits and
Schedules to, the Loan Document in which such references appear, (v) any reference to any law
shall include all statutory and regulatory provisions consolidating, amending, replacing or
interpreting such law and any reference to any law or regulation shall, unless otherwise
specified, refer to such law or regulation as amended, modified or supplemented from time to
time, and (vi) the words “asset” and “property” shall be construed to have the
same meaning and effect and to refer to any and all tangible and intangible assets and
properties, including cash, securities, accounts and contract rights.




     (b) 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.”




     (c) 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.



     1.03 Accounting Terms. (a) Generally. 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,
except as otherwise specifically prescribed herein.




     (b) Changes in GAAP. 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.



     1.04 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).



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



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



ARTICLE II

THE COMMITMENTS AND CREDIT EXTENSIONS




     2.01 Loans.




     (a) Subject to the terms and conditions set forth herein, each Lender severally agrees to
make loans (each such loan, a “Loan”) to the Borrower from time to time, on any Business
Day during the Availability Period, in an aggregate amount not to exceed at any time outstanding
the amount of such Lender’s Commitment; provided, however, that after giving
effect to any Borrowing, (i) the Total Outstandings shall not exceed the Aggregate Commitments,
and (ii) the aggregate Outstanding Amount of the Loans of any Lender, plus such Lender’s
Applicable Percentage of the Outstanding Amount of all L/C Obligations shall not exceed such
Lender’s Commitment. Within the limits of each Lender’s Commitment, and subject to the other
terms and conditions hereof, the Borrower may borrow under this Section 2.01, prepay
under Section 2.04, and reborrow under this Section 2.01. Loans may be Base Rate
Loans or Eurodollar Rate Loans, as further provided herein.




     (b) Anything contained in this Agreement to the contrary notwithstanding, the Loans and the
Aggregate Commitments shall be subject to the following limitations:




     (i) for ten consecutive days during each calendar year, there shall be no Loans
outstanding (although Letters of Credit may continue to be outstanding during such period);
and




     (ii) the Total Outstandings shall not, on any date of determination, exceed an amount
equal to 50% of the aggregate book value of the inventory of Borrower and its Subsidiaries
on such day. Borrower’s compliance with the foregoing limitation shall be measured on the
last day of each Fiscal Quarter (or on such more frequent intervals as may be requested by
the Administrative Agent or the Required Lenders) on a consolidated basis, using the
first-in, first out method, in accordance with GAAP.



     2.02 Borrowings, Conversions and Continuations of Loans.




     (a) Each Borrowing, each conversion of Loans from one Type to the other, and each
continuation of Eurodollar Rate Loans shall be made upon the Borrower’s irrevocable notice to the
Administrative Agent, which may be given by telephone. Each such notice must be received by the
Administrative Agent not later than (i) 10:00 a.m. three Business Days



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prior to the requested
date of any Borrowing of, conversion to or continuation of Eurodollar Rate Loans or of any
conversion of Eurodollar Rate Loans to Base Rate Loans, and (ii) 8:30 a.m. on the requested date
of any Borrowing of Base Rate Loans. Each telephonic notice by the Borrower pursuant to this
Section 2.02(a) must be confirmed promptly by delivery to the Administrative Agent of a
written Loan Notice, appropriately completed and signed by a Responsible Officer of the Borrower.
Each Borrowing of, conversion to or continuation of Eurodollar Rate Loans shall be in a
principal amount of $5,000,000 or a whole multiple of $1,000,000 in excess thereof. Except as
provided in Section 2.03(c), each Borrowing of or conversion to Base Rate Loans shall be
in a principal amount of $500,000 or a whole multiple of $100,000 in excess thereof. Each Loan
Notice (whether telephonic or written) shall specify (i) whether the Borrower is requesting a
Borrowing, a conversion of Loans from one Type to the other, or a continuation of Eurodollar Rate
Loans, (ii) the requested date of the Borrowing, conversion or continuation, as the case may be
(which shall be a Business Day), (iii) the principal amount of Loans to be borrowed, converted or
continued, (iv) the Type of Loans to be borrowed or to which existing Loans are to be converted,
and (v) if applicable, the duration of the Interest Period with respect thereto. If the Borrower
fails to specify a Type of Loan in a Loan Notice or if the Borrower fails to give a timely notice
requesting a conversion or continuation, then the applicable Loans shall be made as, or converted
to, Base Rate Loans. Any such automatic conversion to Base Rate Loans shall be effective as of
the last day of the Interest Period then in effect with respect to the applicable Eurodollar Rate
Loans. If the Borrower requests a Borrowing of, conversion to, or continuation of Eurodollar
Rate Loans in any such Loan Notice, but fails to specify an Interest Period, it will be deemed to
have specified an Interest Period of one month.




     (b) Following receipt of a Loan Notice, the Administrative Agent shall promptly notify each
Lender of the amount of its Applicable Percentage of the applicable Loans, and if no timely
notice of a conversion or continuation is provided by the Borrower, the Administrative Agent
shall notify each Lender of the details of any automatic conversion to Base Rate Loans described
in the preceding subsection. In the case of a Borrowing, each Lender shall make the amount of
its Loan available to the Administrative Agent in immediately available funds at the
Administrative Agent’s Office not later than 11:00 a.m. on the Business Day specified in the
applicable Loan Notice. Upon satisfaction of the applicable
conditions set forth in Section 4.02 (and, if such Borrowing is the initial Credit
Extension, Section 4.01), the Administrative Agent shall make all funds so received
available to the Borrower in like funds as received by the Administrative Agent either by (i)
crediting the account of the Borrower on the books of Bank of America with the amount of such
funds or (ii) wire transfer of such funds, in each case in accordance with instructions provided
to (and reasonably acceptable to) the Administrative Agent by the Borrower; provided,
however, that if, on the date the Loan Notice with respect to such Borrowing is given by
the Borrower, there are L/C Borrowings outstanding, then the proceeds of such Borrowing,
first, shall be applied to the payment in full of any such L/C Borrowings, and
second, shall be made available to the Borrower as provided above.




     (c) Except as otherwise provided herein, a Eurodollar Rate Loan may be continued or
converted only on the last day of an Interest Period for such Eurodollar Rate Loan. During the
existence of a Default, no Loans may be requested as, converted to or continued as Eurodollar
Rate Loans without the consent of the Required Lenders.



-26-









 






     (d) The Administrative Agent shall promptly notify the Borrower and the Lenders of the
interest rate applicable to any Interest Period for Eurodollar Rate Loans upon determination of
such interest rate. At any time that Base Rate Loans are outstanding, the Administrative Agent
shall notify the Borrower and the Lenders of any change in Bank of America’s prime rate used in
determining the Base Rate promptly following the public announcement of such change.




     (e) After giving effect to all Borrowings, all conversions of Loans from one Type to the
other, and all continuations of Loans as the same Type, there shall not be more than ten Interest
Periods in effect with respect to Loans.



     2.03 Letters of Credit.




     (a) The Letter of Credit Commitment.




     (i) Subject to the terms and conditions set forth herein, (A) the L/C Issuer agrees, in
reliance upon the agreements of the Lenders set forth in this Section 2.03, (1) from
time to time on any Business Day during the period from the Closing Date until the Maturity
Date, to issue Letters of Credit for the account of the Borrower or its Subsidiaries, and to
amend or extend Letters of Credit previously issued by it, in accordance with subsection (b)
below, and (2) to honor drawings under the Letters of Credit; and (B) the Lenders severally
agree to participate in Letters of Credit issued for the account of the Borrower or its
Subsidiaries and any drawings thereunder; provided that:




(x) after giving effect to any L/C Credit Extension with respect to any
Letter of Credit, (i) the Total Outstandings shall not exceed the Aggregate
Commitments; and (ii) the aggregate Outstanding Amount of the Loans of any
Lender, plus such Lender’s Applicable Percentage of the Outstanding
Amount of all L/C Obligations shall not exceed such Lender’s
Commitment; and (iii) the Outstanding Amount of the L/C Obligations under
all Letters of Credit other than Permitted Workers Compensation Letters of
Credit shall not exceed $25,000,000;




(y) standby Letters of Credit shall be requested and issued only for
the purpose of (i) securing workers’ compensation and other insurance
coverages for Borrower and its Subsidiaries in an amount not at any time to
exceed the minimum amount required by Holdings’, Borrower’s, or any of
Borrower’s Subsidiaries’ insurance carriers or applicable regulatory
agencies and (ii) supporting obligations of Borrower and its Subsidiaries
incurred in the construction of distribution centers, stores and related
shopping centers; and




(z) commercial Letters of Credit shall be requested and issued only for the
purpose of supporting the purchase of inventory by Borrower and its
Subsidiaries.



-27-









 






Each request by the Borrower for the issuance or amendment of a Letter of Credit shall be
deemed to be a representation by the Borrower that the L/C Credit Extension so requested
complies with the conditions set forth in the proviso to the preceding sentence. Within the
foregoing limits, and subject to the terms and conditions hereof, the Borrower’s ability to
obtain Letters of Credit shall be fully revolving, and accordingly the Borrower may, during
the foregoing period, obtain Letters of Credit to replace Letters of Credit that have
expired or that have been drawn upon and reimbursed. All Existing Letters of Credit shall
be deemed to have been issued pursuant hereto, and from and after the Closing Date shall be
subject to and governed by the terms and conditions hereof. All unpaid reimbursement
obligations owed in respect of amounts drawn on Existing Letters of Credit shall be
reimbursement obligations hereunder.




     (ii) The L/C Issuer shall not issue any Letter of Credit, if:




     (A) subject to Section 2.03(b)(iii), the expiry date of such requested
standby Letter of Credit would occur more than twelve months after the date of
issuance or last extension, unless the Required Lenders have approved such expiry
date; or




     (B) the expiry date of such requested commercial Letter of Credit would occur
more than 180 days after the date of issuance, unless the Required Lenders have
approved such expiry date; or




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




     (iii) The L/C Issuer shall not be under any obligation to issue any Letter of Credit
if:




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




     (B) the issuance of such Letter of Credit would violate one or more policies of
the L/C Issuer applicable to letters of credit generally;




     (C) except as otherwise agreed by the Administrative Agent and the L/C Issuer
and except for the Existing Letters of Credit, such Letter of Credit is in



-28-









 







an
initial stated amount less than $100,000, in the case of a commercial Letter of
Credit, or $500,000, in the case of a standby Letter of Credit;




     (D) such Letter of Credit is to be denominated in a currency other than
Dollars; or




     (E) a default of any Lender’s obligations to fund under Section 2.03(c)
exists or any Lender is at such time an Impacted Lender hereunder, unless the L/C
Issuer has entered into arrangements satisfactory to the L/C Issuer with the
Borrower or such Impacted Lender to eliminate the L/C Issuer’s risk with respect to
such Lender.




     (iv) The L/C Issuer shall not amend any Letter of Credit if the L/C Issuer would not be
permitted at such time to issue such Letter of Credit in its amended form under the terms
hereof.




     (v) The L/C Issuer shall be under no obligation to amend any Letter of Credit if (A)
the L/C Issuer would have no obligation at such time to issue such Letter of Credit in its
amended form under the terms hereof, or (B) the beneficiary of such Letter of Credit does
not accept the proposed amendment to such Letter of Credit.




     (vi) The L/C Issuer shall act on behalf of the Lenders with respect to any Letters of
Credit issued by it and the documents associated therewith, and the L/C Issuer shall have
all of the benefits and immunities (A) provided to the Administrative Agent in Article
X with respect to any acts taken or omissions suffered by the L/C Issuer in connection
with Letters of Credit issued by it or proposed to be issued by it and Issuer Documents
pertaining to such Letters of Credit as fully as if the term “Administrative Agent” as used
in Article X included the L/C Issuer with respect to such acts or omissions, and (B)
as additionally provided herein with respect to the L/C Issuer.




     (b) Procedures for Issuance and Amendment of Letters of Credit; Auto-Extension Letters
of Credit.




     (i) Each Letter of Credit shall be issued or amended, as the case may be, upon the
request of the Borrower delivered to the L/C Issuer (with a copy to the Administrative
Agent) in the form of a Letter of Credit Application, appropriately completed and signed by
a Responsible Officer of the Borrower. Such Letter of Credit Application must be received
by the L/C Issuer and the Administrative Agent not later than 10:00 a.m. at least five
Business Days (or such later date and time as the Administrative Agent and the L/C Issuer
may agree in a particular instance in their sole discretion) prior to the proposed issuance
date or date of amendment, as the case may be. In the case of a request for an initial
issuance of a Letter of Credit, such Letter of Credit Application shall specify in form and
detail satisfactory to the L/C Issuer: (A) the proposed issuance date of the requested
Letter of Credit (which shall be a Business Day); (B) the amount thereof; (C) the expiry
date thereof; (D) the name and address of the beneficiary thereof; (E) the documents to be
presented by such beneficiary in case of any drawing thereunder; (F) the full text of any
certificate to be presented by such beneficiary in case of any drawing



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thereunder; (G) the
purpose and nature of the requested Letter of Credit; and (H) such other matters as the L/C
Issuer may require. In the case of a request for an amendment of any outstanding Letter of
Credit, such Letter of Credit Application shall specify in form and detail satisfactory to
the L/C Issuer (A) the Letter of Credit to be amended; (B) the proposed date of amendment
thereof (which shall be a Business Day); (C) the nature of the proposed amendment; and (D)
such other matters as the L/C Issuer may require. Additionally, the Borrower shall furnish
to the L/C Issuer and the Administrative Agent such other documents and information
pertaining to such requested Letter of Credit issuance or amendment, including any Issuer
Documents, as the L/C Issuer or the Administrative Agent may require.




     (ii) Promptly after receipt of any Letter of Credit Application, the L/C Issuer will
confirm with the Administrative Agent (by telephone or in writing) that the Administrative
Agent has received a copy of such Letter of Credit Application from the Borrower and, if
not, the L/C Issuer will provide the Administrative Agent with a copy thereof. Unless the
L/C Issuer has received written notice from any Lender, the Administrative Agent or any Loan
Party, at least one Business Day prior to the requested date of issuance or amendment of the
applicable Letter of Credit, that one or more applicable conditions contained in Article
IV shall not then be satisfied, then, subject to the terms and conditions hereof, the
L/C Issuer shall, on the requested date, issue a Letter of Credit for the account of the
Borrower (or the applicable Subsidiary) or enter into the applicable amendment, as the case
may be, in each case in accordance with the L/C Issuer’s usual and customary business
practices. Immediately upon the issuance of each Letter of Credit, each Lender shall be
deemed to, and hereby irrevocably and unconditionally agrees to, purchase from the L/C
Issuer a risk participation in such Letter of Credit in an amount equal to the product of
such Lender’s Applicable Percentage times the amount of such Letter of Credit.




     (iii) If the Borrower so requests in any applicable Letter of Credit Application, the
L/C Issuer may, in its sole and absolute discretion, agree to issue a Letter of Credit
that has automatic extension provisions (each, an “Auto-Extension Letter of
Credit”); provided that any such Auto-Extension Letter of Credit must permit the
L/C Issuer to prevent any such extension at least once in each twelve-month period
(commencing with the date of issuance of such Letter of Credit) by giving prior notice to
the beneficiary thereof not later than a day (the “Non-Extension Notice Date”) in
each such twelve-month period to be agreed upon at the time such Letter of Credit is issued.
The L/C Issuer may, in its sole discretion, elect not to permit any Auto-Extension Letter
of Credit to be extended or renewed. Unless otherwise directed by the L/C Issuer, the
Borrower shall not be required to make a specific request to the L/C Issuer for any such
extension. Once an Auto-Extension Letter of Credit has been issued, the Lenders shall be
deemed to have authorized (but may not require) the L/C Issuer to permit the extension of
such Letter of Credit at any time to an expiry date not later than the Letter of Credit
Expiration Date; provided, however, that the L/C Issuer shall not permit any
such extension if (A) the L/C Issuer has determined that it would not be permitted, or would
have no obligation, at such time to issue such Letter of Credit in its revised form (as
extended) under the terms hereof (by reason of the provisions of clause (ii) or (iii) of
Section 2.03(a) or otherwise), or (B) it has received notice (which may be by
telephone or in



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writing) on or before the day that is seven Business Days before the
Non-Extension Notice Date (1) from the Administrative Agent that the Required Lenders have
elected not to permit such extension or (2) from the Administrative Agent, any Lender or the
Borrower that one or more of the applicable conditions specified in Section 4.02 is
not then satisfied, and in each such case directing the L/C Issuer not to permit such
extension.




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




     (c) Drawings and Reimbursements; Funding of Participations.




     (i) Upon receipt from the beneficiary of any Letter of Credit of any notice of a
drawing under such Letter of Credit, the L/C Issuer shall notify the Borrower and the
Administrative Agent thereof. Not later than 11:00 a.m. on the date of any payment by the
L/C Issuer under a Letter of Credit (each such date, an “Honor Date”), the Borrower
shall reimburse the L/C Issuer through the Administrative Agent in an amount equal to the
amount of such drawing. If the Borrower fails to so reimburse the L/C Issuer by such time,
the Administrative Agent shall promptly notify each Lender of the Honor Date, the amount of
the unreimbursed drawing (the “Unreimbursed Amount”), and the amount of such
Lender’s Applicable Percentage thereof. In such event, the Borrower shall be deemed to have
requested a Borrowing of Base Rate Loans to be disbursed on the Honor Date in an amount
equal to the Unreimbursed Amount, without regard to the minimum and multiples specified in
Section 2.02 for the principal amount of Base Rate Loans, but subject to the amount
of the unutilized portion of the Aggregate Commitments and the conditions set forth in
Section 4.02 (other than the delivery of a Loan Notice). Any notice given by the
L/C Issuer or the Administrative Agent pursuant to this Section 2.03(c)(i) may be
given by telephone if immediately confirmed in writing; provided that the lack of
such an immediate confirmation shall not affect the conclusiveness or binding effect of such
notice.




     (ii) Each Lender shall upon any notice pursuant to Section 2.03(c)(i) make
funds available to the Administrative Agent for the account of the L/C Issuer at the
Administrative Agent’s Office in an amount equal to its Applicable Percentage of the
Unreimbursed Amount not later than 11:00 a.m. on the Business Day specified in such notice
by the Administrative Agent, whereupon, subject to the provisions of Section
2.03(c)(iii), each Lender that so makes funds available shall be deemed to have made a
Base Rate Loan to the Borrower in such amount. The Administrative Agent shall remit the
funds so received to the L/C Issuer.




     (iii) With respect to any Unreimbursed Amount that is not fully refinanced by a
Borrowing of Base Rate Loans because the conditions set forth in Section 4.02 cannot
be satisfied or for any other reason, the Borrower shall be deemed to have incurred from the
L/C Issuer an L/C Borrowing in the amount of the Unreimbursed Amount that is not so
refinanced, which L/C Borrowing shall be due and payable on demand (together with interest)
and shall bear interest at the Default Rate. In such event, each Lender’s payment



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to the
Administrative Agent for the account of the L/C Issuer pursuant to Section
2.03(c)(ii) shall be deemed payment in respect of its participation in such L/C
Borrowing and shall constitute an L/C Advance from such Lender in satisfaction of its
participation obligation under this Section 2.03.




     (iv) Until each Lender funds its Loan or L/C Advance pursuant to this Section
2.03(c) to reimburse the L/C Issuer for any amount drawn under any Letter of Credit,
interest in respect of such Lender’s Applicable Percentage of such amount shall be solely
for the account of the L/C Issuer.




     (v) Each Lender’s obligation to make Loans or L/C Advances to reimburse the L/C Issuer
for amounts drawn under Letters of Credit, as contemplated by this Section 2.03(c),
shall be absolute and unconditional and shall not be affected by any circumstance, including
(A) any setoff, counterclaim, recoupment, defense or other right which such Lender may have
against the L/C Issuer, the Borrower or any other Person for any reason whatsoever; (B) the
occurrence or continuance of a Default, or (C) any other occurrence, event or condition,
whether or not similar to any of the foregoing; provided, however, that each
Lender’s obligation to make Loans pursuant to this Section 2.03(c) is subject to the
conditions set forth in Section 4.02 (other than delivery by the Borrower of a Loan
Notice). No such making of an L/C Advance shall relieve or otherwise impair the obligation
of the Borrower to reimburse the L/C Issuer for the amount of any payment made by the L/C
Issuer under any Letter of Credit, together with interest as provided herein.




     (vi) If any Lender fails to make available to the Administrative Agent for the account
of the L/C Issuer any amount required to be paid by such Lender pursuant to the foregoing
provisions of this Section 2.03(c) by the time specified in Section
2.03(c)(ii), the L/C Issuer shall be entitled to recover from such Lender (acting
through the Administrative Agent), on demand, such amount with interest thereon for the
period from the date such payment is required to the date on which such payment is
immediately available to the L/C Issuer at a rate per annum equal to the greater of the
Federal Funds Rate and a rate determined by the L/C Issuer in accordance with banking
industry rules
on interbank compensation, plus any administrative, processing or similar fees
customarily charged by the L/C Issuer in connection with the foregoing. If such Lender pays
such amount (with interest and fees as aforesaid), the amount so paid shall constitute such
Lender’s Loan included in the relevant Borrowing or L/C Advance in respect of the relevant
L/C Borrowing, as the case may be. A certificate of the L/C Issuer submitted to any Lender
(through the Administrative Agent) with respect to any amounts owing under this clause (vi)
shall be conclusive absent manifest error.




     (d) Repayment of Participations.




     (i) At any time after the L/C Issuer has made a payment under any Letter of Credit and
has received from any Lender such Lender’s L/C Advance in respect of such payment in
accordance with Section 2.03(c), if the Administrative Agent receives for the
account of the L/C Issuer any payment in respect of the related Unreimbursed Amount or
interest thereon (whether directly from the Borrower or otherwise, including proceeds of



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Cash Collateral applied thereto by the Administrative Agent), the Administrative Agent will
distribute to such Lender its Applicable Percentage thereof in the same funds as those
received by the Administrative Agent.




     (ii) If any payment received by the Administrative Agent for the account of the L/C
Issuer pursuant to Section 2.03(c)(i) is required to be returned under any of the
circumstances described in Section 11.05 (including pursuant to any settlement
entered into by the L/C Issuer in its discretion), each Lender shall pay to the
Administrative Agent for the account of the L/C Issuer its Applicable Percentage thereof on
demand of the Administrative Agent, plus interest thereon from the date of such demand to
the date such amount is returned by such Lender, at a rate per annum equal to the Federal
Funds Rate from time to time in effect. The obligations of the Lenders under this clause
shall survive the payment in full of the Obligations and the termination of this Agreement.




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




     (i) any lack of validity or enforceability of such Letter of Credit, this Agreement, or
any other Loan Document;




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




     (iii) any draft, demand, certificate or other document presented under such Letter of
Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any
statement therein being untrue or inaccurate in any respect; or any loss or delay in the
transmission or otherwise of any document required in order to make a drawing under
such Letter of Credit;




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




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




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




          (f) Role of L/C Issuer. Each Lender and the Borrower agree that, in paying any
drawing under a Letter of Credit, the L/C Issuer shall not have any responsibility to obtain any
document (other than any sight draft, certificates and documents expressly required by the Letter
of Credit) or to ascertain or inquire as to the validity or accuracy of any such document or the
authority of the Person executing or delivering any such document. None of the L/C Issuer, the
Administrative Agent, any of their respective Related Parties nor any correspondent, participant
or assignee of the L/C Issuer shall be liable to any Lender for (i) any action taken or omitted
in connection herewith at the request or with the approval of the Lenders or the Required
Lenders, as applicable; (ii) any action taken or omitted in the absence of gross negligence or
willful misconduct; or (iii) the due execution, effectiveness, validity or enforceability of any
document or instrument related to any Letter of Credit or Issuer Document. The Borrower hereby
assumes all risks of the acts or omissions of any beneficiary or transferee with respect to its
use of any Letter of Credit; provided, however, that this assumption is not
intended to, and shall not, preclude the Borrower’s pursuing such rights and remedies as it may
have against the beneficiary or transferee at law or under any other agreement. None of the L/C
Issuer, the Administrative Agent, any of their respective Related Parties nor any correspondent,
participant or assignee of the L/C Issuer shall be liable or responsible for any of the matters
described in clauses (i) through (v) of Section 2.03(e); provided,
however, that anything in such clauses to the contrary notwithstanding, the Borrower may
have a claim against the L/C Issuer, and the L/C Issuer may be liable to the Borrower, to the
extent, but only to the extent, of any direct, as opposed to consequential or exemplary, damages
suffered by the Borrower which the Borrower proves were caused by the L/C Issuer’s willful
misconduct or gross negligence or the L/C Issuer’s willful failure to pay
under any Letter of Credit after the presentation to it by the beneficiary of a sight draft
and certificate(s) strictly complying with the terms and conditions of a Letter of Credit. In
furtherance and not in limitation of the foregoing, the L/C Issuer may accept documents that
appear on their face to be in order, without responsibility for further investigation, regardless
of any notice or information to the contrary, and the L/C Issuer shall not be responsible for the
validity or sufficiency of any instrument transferring or assigning or purporting to transfer or
assign a Letter of Credit or the rights or benefits thereunder or proceeds thereof, in whole or
in part, which may prove to be invalid or ineffective for any reason.




          (g) Cash Collateral. The Borrower shall, in each case, immediately Cash
Collateralize the then Outstanding Amount of all L/C Obligations, (i) upon the request of the
Administrative Agent, if the L/C Issuer has honored any full or partial drawing request under any
Letter of Credit and such drawing has resulted in an L/C Borrowing, or (ii) automatically and
without further act of the Administrative Agent or the L/C Issuer, if any L/C Obligation for any
reason remains outstanding as of the Maturity Date. Sections 2.04 and 9.02(c)
set forth certain additional requirements to deliver Cash Collateral hereunder. For purposes of
this Section 2.03, Section 2.04 and Section 9.02(c), “Cash
Collateralize” means to pledge and deposit with or deliver to the Administrative Agent, for
the benefit of the L/C Issuer and the



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Lenders, as collateral for the L/C Obligations, cash or
deposit account balances pursuant to documentation in form and substance satisfactory to the
Administrative Agent and the L/C Issuer (which documents are hereby consented to by the Lenders).
Derivatives of such term have corresponding meanings. The Borrower hereby grants to the
Administrative Agent, for the benefit of the L/C Issuer and the Lenders, a security interest in
all such cash, deposit accounts and all balances therein and all proceeds of the foregoing. Cash
Collateral shall be maintained in blocked, non-interest bearing deposit accounts at Bank of
America.




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




          (i) Standby Letter of Credit Fees. The Borrower shall pay to the Administrative
Agent, for the account of each Lender in accordance with its Applicable Percentage, a Letter of
Credit fee (the “Letter of Credit Fee”) for each standby Letter of Credit equal to the
Applicable Rate times the daily amount available to be drawn under such standby Letter of
Credit. For purposes of computing the daily amount available to be drawn under any standby
Letter of Credit, the amount of such standby Letter of Credit shall be determined in accordance
with Section 1.06. Letter of Credit Fees shall be (i) due and payable on each Quarterly
Payment Date, commencing with the first such date to occur after the issuance of such standby
Letter of Credit, on the Maturity Date, on the Letter of Credit Expiration Date (or on any
earlier date upon which the Aggregate Commitments are terminated in accordance with this
Agreement) and thereafter on demand and (ii) computed on a quarterly basis in arrears. If there
is any change in the Applicable Rate during any quarter, the daily amount available to be drawn
under each standby Letter of Credit shall be computed and multiplied by the Applicable Rate
separately for each period during such quarter that such Applicable Rate
was in effect. Notwithstanding anything to the contrary contained herein, upon the request
of the Required Lenders, while any Event of Default exists, all Letter of Credit Fees shall
accrue at the Default Rate.




          (j) Fronting Fee, Issuance Fee and Documentary and Processing Charges Payable to L/C
Issuer. Concurrently with the issuance, extension or renewal of each Letter of Credit, the
Borrower shall pay directly to the L/C Issuer for its own account a fronting fee in an amount set
forth in the Fee Letter and, in the case of each commercial Letter of Credit, a fee based on the
L/C Issuer’s standard schedule of fees for the issuance of commercial letters of credit as then
in effect. In addition, the Borrower shall pay directly to the L/C Issuer for its own account
the customary issuance, presentation, amendment and other processing fees, and other standard
costs and charges, of the L/C Issuer relating to letters of credit as from time to time in
effect. Such fronting fees, issuance fees, customary fees and standard costs and charges are due
and payable on demand and are nonrefundable for any reason whatsoever.




          (k) Conflict with Issuer Documents. In the event of any conflict between the terms
hereof and the terms of any Issuer Document, the terms hereof shall control.



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          (l) Letters of Credit Issued for Subsidiaries. Notwithstanding that a Letter of
Credit issued or outstanding hereunder is in support of any obligations of, or is for the account
of, a Subsidiary, the Borrower shall be obligated to reimburse the L/C Issuer hereunder for any
and all drawings under such Letter of Credit. The Borrower hereby acknowledges that the issuance
of Letters of Credit for the account of Subsidiaries inures to the benefit of the Borrower, and
that the Borrower’s business derives substantial benefits from the businesses of such
Subsidiaries.


          2.04 Prepayments.




          (a) The Borrower may, upon notice to the Administrative Agent, at any time or from time to
time voluntarily prepay Loans in whole or in part without premium or penalty; provided
that (i) such notice must be received by the Administrative Agent not later than (A) 10:00 a.m.
three Business Days prior to any date of prepayment of Eurodollar Rate Loans and (B) 8:30 a.m. on
the date of prepayment of Base Rate Loans; (ii) any prepayment of Eurodollar Rate Loans shall be
in a principal amount of $5,000,000 or a whole multiple of $1,000,000 in excess thereof; and
(iii) any prepayment of Base Rate Loans shall be in a principal amount of $500,000 or a whole
multiple of $100,000 in excess thereof or, in each case, if less, the entire principal amount
thereof then outstanding. Each such notice shall specify the date and amount of such prepayment
and the Type(s) of Loans to be prepaid and, if Eurodollar Rate Loans are to be prepaid, the
Interest Period(s) of such Loans. The Administrative Agent will promptly notify each Lender of
its receipt of each such notice, and of the amount of such Lender’s Applicable Percentage of such
prepayment. If such notice is given by the Borrower, the Borrower shall make such prepayment and
the payment amount specified in such notice shall be due and payable on the date specified
therein. Any prepayment of a Eurodollar Rate Loan shall be accompanied by all accrued interest
on the amount prepaid, together with any additional amounts required pursuant to Section
3.05.
Each such prepayment shall be applied to the Loans of the Lenders in accordance with their
respective Applicable Percentages.




          (b) If for any reason the Outstanding Amount of Loans or the Total Outstandings exceed (i)
the limitations set forth in Section 2.01(b), (ii) the Aggregate Commitments or (iii) any
other limitation set forth in any other provision of this Agreement, Borrower shall immediately
prepay Loans and/or Cash Collateralize the L/C Obligations in an aggregate amount equal to such
excess.


          2.05 Termination or Reduction of Commitments. The Borrower may, upon notice to the Administrative
Agent, terminate the Aggregate Commitments, or from time to time permanently reduce the Aggregate
Commitments; provided that (i) any such notice shall be received by the Administrative
Agent not later than 10:00 a.m. two Business Days prior to the date of termination or reduction,
(ii) any such partial reduction shall be in an aggregate amount of $1,000,000 or any whole multiple
of $500,000 in excess thereof, and (iii) the Borrower shall not terminate or reduce the Aggregate
Commitments if, after giving effect thereto and to any concurrent prepayments hereunder, the Total
Outstandings would exceed the Aggregate Commitments. The Administrative Agent will promptly notify
the Lenders of any such notice of termination or reduction of the Aggregate Commitments. Any
reduction of the Aggregate Commitments shall be applied to the Commitment of each Lender according
to its Applicable



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Percentage. All commitments fees (as described in Section 2.08(a)) accrued until
the effective date of any termination of the Aggregate Commitments shall be paid on the effective
date of such termination.



          2.06 Repayment of Loans. The Borrower shall repay to the Lenders on or before the Maturity Date
the aggregate principal amount of Loans outstanding on such date.


          2.07 Interest.




          (a) Subject to the provisions of subsection (b) below, (i) each Eurodollar Rate Loan shall
bear interest on the outstanding principal amount thereof for each Interest Period at a rate per
annum equal to the Eurodollar Rate for such Interest Period plus the Applicable Rate; and
(ii) each Base Rate Loan shall bear interest on the outstanding principal amount thereof from the
applicable borrowing date at a rate per annum equal to the Base Rate plus the Applicable
Rate.




          (b) (i) If any amount of principal of any Loan is not paid when due (without regard to any
applicable grace periods), whether at stated maturity, by acceleration or otherwise, such amount
shall thereafter bear interest at a fluctuating interest rate per annum at all times equal to the
Default Rate to the fullest extent permitted by applicable Laws.




          (ii) If any amount (other than principal of any Loan) payable by the Borrower under any
Loan Document is not paid when due (without regard to any applicable grace
periods), whether at stated maturity, by acceleration or otherwise, then upon the
request of the Required Lenders, such amount shall thereafter bear interest at a fluctuating
interest rate per annum at all times equal to the Default Rate to the fullest extent
permitted by applicable Laws.




          (iii) Upon the request of the Required Lenders, while any Event of Default exists, the
Borrower shall pay interest on the principal amount of all outstanding Obligations hereunder
at a fluctuating interest rate per annum at all times equal to the Default Rate to the
fullest extent permitted by applicable Laws.




          (iv) Accrued and unpaid interest on past due amounts (including interest on past due
interest) shall be due and payable upon demand.




          (c) Interest on each Loan shall be due and payable in arrears on each Interest Payment Date
applicable thereto and at such other times as may be specified herein. Interest hereunder shall
be due and payable in accordance with the terms hereof before and after judgment, and before and
after the commencement of any proceeding under any Debtor Relief Law.


          2.08 Fees. In addition to certain fees described in subsections (i) and (j) of
Section 2.03:




          (a) Commitment Fee. The Borrower shall pay to the Administrative Agent for the
account of each Lender in accordance with its Applicable Percentage, a commitment fee equal to
the Applicable Rate times the actual daily amount by which the Aggregate Commitments



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exceed the sum of (i) the Outstanding Amount of Loans and (ii) the Outstanding Amount of L/C
Obligations with respect to standby Letters of Credit. The commitment fee shall accrue at all
times during the Availability Period, including at any time during which one or more of the
conditions in Article IV is not met, and shall be due and payable quarterly in arrears on
each Quarterly Payment Date, commencing with the first such date to occur after the Closing Date,
and on the last day of the Availability Period. The commitment fee shall be calculated quarterly
in arrears, and if there is any change in the Applicable Rate during any quarter, the actual
daily amount shall be computed and multiplied by the Applicable Rate separately for each period
during such quarter that such Applicable Rate was in effect.




          (b) Other Fees. The Borrower shall pay to the Arranger and the Administrative Agent
for their own respective accounts fees in the amounts and at the times specified in the Fee
Letter. Such fees shall be fully earned when paid and shall not be refundable for any reason
whatsoever.


          2.09 Computation of Interest and Fees. All computations of interest for Base Rate Loans when the
Base Rate is determined by Bank of America’s “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 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).
Interest shall accrue on
each Loan for the day on which the Loan is made, and shall not accrue on a Loan, or any portion
thereof, for the day on which the Loan or such portion is paid, provided that any Loan that
is repaid on the same day on which it is made shall, subject to Section 2.11(a), bear
interest for one day. Each determination by the Administrative Agent of an interest rate or fee
hereunder shall be conclusive and binding for all purposes, absent manifest error.


          2.10 Evidence of Debt.




          (a) The Credit Extensions 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 actual amount of the Credit Extensions 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 Note, which shall evidence such Lender’s Loans in addition to such
accounts or records. Each Lender may attach schedules to its Note and endorse thereon the date,
Type (if applicable), amount and maturity of its Loans and payments with respect thereto.




          (b) 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



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accounts or records
evidencing the purchases and sales by such Lender of participations in Letters of Credit. 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.


          2.11 Payments Generally; Administrative Agent’s Clawback.




          (a) General. All payments to be made by the Borrower shall be made without
condition or deduction for any counterclaim, defense, recoupment or setoff. Except as otherwise
expressly provided herein, all payments by the Borrower hereunder shall be made to the
Administrative Agent, for the account of the respective Lenders to which such payment is owed, at
the Administrative Agent’s Office in Dollars and in immediately available funds not later than
11:00 a.m. on the date specified herein. The Administrative Agent will promptly distribute to
each Lender its Applicable Percentage (or other applicable share as provided herein) of such
payment in like funds as received by wire transfer to such Lender’s Lending Office. All payments
received by the Administrative Agent after 11:00 a.m. shall be
deemed received on the next succeeding Business Day and any applicable interest or fee shall
continue to accrue. If any payment to be made by the Borrower shall come due on a day other than
a Business Day, payment shall be made on the next following Business Day, and such extension of
time shall be reflected in computing interest or fees, as the case may be.




          (b) (i) Funding by Lenders; Presumption by Administrative Agent. Unless the
Administrative Agent shall have received notice from a Lender prior to the proposed date of any
Borrowing of Eurodollar Rate Loans (or, in the case of any Borrowing of Base Rate Loans, prior to
10:00 a.m. on the date of such Borrowing) that such Lender will not make available to the
Administrative Agent such Lender’s share of such Borrowing, the Administrative Agent may assume
that such Lender has made such share available on such date in accordance with Section
2.02 (or, in the case of a Borrowing of Base Rate Loans, that such Lender has made such share
available in accordance with and at the time required by Section 2.02) and may, in
reliance upon such assumption, make available to the Borrower a corresponding amount. In such
event, if a Lender has not in fact made its share of the applicable Borrowing available to the
Administrative Agent, then the applicable Lender and the Borrower severally agree to pay to the
Administrative Agent forthwith on demand such corresponding amount in immediately available funds
with interest thereon, for each day from and including the date such amount is made available to
the Borrower to but excluding the date of payment to the Administrative Agent, at (A) in the case
of a payment to be made by such Lender, the greater of the Federal Funds Rate and a rate
determined by the Administrative Agent in accordance with banking industry rules on interbank
compensation, plus any administrative, processing or similar fees customarily charged by the
Administrative Agent in connection with the foregoing, and (B) in the case of a payment to be
made by the Borrower, the interest rate applicable to Base Rate Loans. If the Borrower and such
Lender shall pay such interest to the Administrative Agent for the same or an overlapping period,
the Administrative Agent shall promptly remit to the Borrower the amount of such interest paid by
the Borrower for such period. If such Lender pays its share of the applicable Borrowing to the
Administrative Agent, then the amount so paid shall constitute such Lender’s Loan included in
such Borrowing. Any payment by the Borrower shall be without prejudice to any



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claim the Borrower
may have against a Lender that shall have failed to make such payment to the Administrative
Agent.




          (ii) Payments by Borrower; Presumptions by Administrative Agent. Unless the
Administrative Agent shall have received notice from the Borrower prior to the date on which
any payment is due to the Administrative Agent for the account of the Lenders or the L/C
Issuer hereunder that the Borrower will not make such payment, the Administrative Agent may
assume that the Borrower has made such payment on such date in accordance herewith and may,
in reliance upon such assumption, distribute to the Lenders or the L/C Issuer, as the case
may be, the amount due. In such event, if the Borrower has not in fact made such payment,
then each of the Lenders or the L/C Issuer, as the case may be, severally agrees to repay to
the Administrative Agent forthwith on demand the amount so distributed to such Lender or the
L/C Issuer, in immediately available funds with interest thereon, for each day from and
including the date such amount is distributed to it to but excluding the date of payment to
the Administrative Agent, at the greater of the Federal Funds Rate and a rate determined by
the
Administrative Agent in accordance with banking industry rules on interbank
compensation.


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




          (c) Failure to Satisfy Conditions Precedent. If any Lender makes available to the
Administrative Agent funds for any Loan to be made by such Lender as provided in the foregoing
provisions of this Article II, and such funds are not made available to the Borrower by
the Administrative Agent because the conditions to the applicable Credit Extension set forth in
Article IV are not satisfied or waived in accordance with the terms hereof, the
Administrative Agent shall return such funds (in like funds as received from such Lender) to such
Lender, without interest.




          (d) Obligations of Lenders Several. The obligations of the Lenders hereunder to
make Loans, to fund participations in Letters of Credit and to make payments pursuant to
Section 11.04(c) are several and not joint. The failure of any Lender to make any Loan,
to fund any such participation or to make any payment under Section 11.04(c) on any date
required hereunder shall not relieve any other Lender of its corresponding obligation to do so on
such date, and no Lender shall be responsible for the failure of any other Lender to so make its
Loan, to purchase its participation or to make its payment under Section 11.04(c).




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


          2.12 Sharing of Payments by Lenders. 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 the
Loans made by it, or the participations in L/C Obligations held by it resulting in such Lender’s
receiving payment of a proportion of the aggregate amount of such Loans or 


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participations and
accrued interest thereon greater than its pro rata share thereof as provided
herein, then the Lender receiving such greater proportion shall (a) notify the Administrative Agent
of such fact, and (b) purchase (for cash at face value) participations in the Loans and
subparticipations in L/C 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 or subparticipations are purchased and all or any
portion of the payment giving rise thereto is recovered, such participations or
subparticipations shall be rescinded and the purchase price restored to the extent of such
recovery, without interest; and




          (ii) the provisions of this Section shall not be construed to apply to (x) any payment
made by the Borrower pursuant to and in accordance with the express terms of
this Agreement or (y) any payment obtained by a Lender as consideration for the
assignment of or sale of a participation in any of its Loans or subparticipations in L/C
Obligations to any assignee or participant, other than to Holdings or any of its
Subsidiaries (as to which the provisions of this Section shall apply).


          The Borrower 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 the Borrower rights of setoff and counterclaim with respect to
such participation as fully as if such Lender were a direct creditor of the Borrower in the amount
of such participation.



ARTICLE III

TAXES, YIELD PROTECTION AND ILLEGALITY



          3.01 Taxes.




          (a) Payments Free of Taxes; Obligation to Withhold; Payments on Account of Taxes.
(i) Any and all payments by or on account of any obligation of the Borrower hereunder or under
any other Loan Document shall to the extent permitted by applicable Laws be made free and clear
of and without reduction or withholding for any Taxes. If, however, applicable Laws require the
Borrower or the Administrative Agent to withhold or deduct any Tax, such Tax shall be withheld or
deducted in accordance with such Laws as determined by the Borrower or the Administrative Agent,
as the case may be, upon the basis of the information and documentation to be delivered pursuant
to subsection (e) below.




          (ii) If the Borrower or the Administrative Agent shall be required by the Code to
withhold or deduct any Taxes, including both United States Federal backup withholding and
withholding taxes, from any payment, then (A) the Administrative Agent shall withhold or
make such deductions as are determined by the Administrative Agent to be required based upon
the information and documentation it has received pursuant to subsection (e) below, (B) the
Administrative Agent shall timely pay the full amount withheld or deducted to the relevant
Governmental Authority in accordance with



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the Code, and (C) to the extent that the
withholding or deduction is made on account of Indemnified Taxes or Other Taxes, the sum
payable by the Borrower shall be increased as necessary so that after any required
withholding or the making of all required deductions (including deductions applicable to
additional sums payable under this Section) the Administrative Agent, Lender or L/C Issuer,
as the case may be, receives an amount equal to the sum it would have received had no such
withholding or deduction been made.




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




          (c) Tax Indemnifications. (i) Without limiting the provisions of subsection (a) or
(b) above, the Borrower shall, and does hereby, indemnify the Administrative Agent, each
Lender and the L/C Issuer, and shall make payment in respect thereof within 10 days after
demand therefor, for the full amount of any Indemnified Taxes or Other Taxes either withheld or
deducted by the Borrower for the account of a Lender or the L/C Issuer or paid on behalf of
Borrower by the Administrative Agent, a Lender or the L/C Issuer, 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.




          (ii) Without limiting the provisions of subsection (a) or (b) above, each Lender and the
L/C Issuer shall, and does hereby, indemnify the Borrower and the Administrative Agent, and
shall make payment in respect thereof within 10 days after demand therefor, against any and
all Taxes and any and all related losses, claims, liabilities, penalties, interest and
expenses (including the fees, charges and disbursements of any counsel for the Borrower or
the Administrative Agent) incurred by or asserted against the Borrower or the Administrative
Agent by any Governmental Authority as a result of the failure by such Lender or the L/C
Issuer, as the case may be, to deliver, or as a result of the inaccuracy, inadequacy or
deficiency of, any documentation required to be delivered by such Lender or the L/C Issuer,
as the case may be, to the Borrower or the Administrative Agent pursuant to subsection (e).
Each Lender and the L/C Issuer hereby authorizes the Administrative Agent to set off and
apply any and all amounts at any time owing to such Lender or the L/C Issuer, as the case
may be, under this Agreement or any other Loan Document against any amount due to the
Administrative Agent under this clause (ii). The agreements in this clause (ii) shall
survive the resignation and/or replacement of the Administrative Agent, any assignment of
rights by, or the replacement of, a Lender or the L/C Issuer, the termination of the
Aggregate Commitments and the repayment, satisfaction or discharge of all other Obligations.




          (d) Evidence of Payments. Upon request by the Borrower or the Administrative Agent,
as the case may be, after any payment of Taxes by the Borrower or by the Administrative Agent to
a Governmental Authority as provided in this Section 3.01, the Borrower shall deliver to
the Administrative Agent or the Administrative Agent shall deliver to the Borrower, as the case
may be, the original or a certified copy of a receipt issued by such Governmental Authority
evidencing such payment, a copy of any return required by Laws to



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report such payment or other
evidence of such payment reasonably satisfactory to the Borrower or the Administrative Agent, as
the case may be.



          (e) Status of Lenders; Tax Documentation. (i) Each Lender shall deliver to the
Borrower and to the Administrative Agent, at the time or times prescribed by applicable Laws or
when reasonably requested by the Borrower or the Administrative Agent, such properly completed
and executed documentation prescribed by applicable Laws or by the taxing authorities of any
jurisdiction and such other reasonably requested information as will permit the Borrower or the
Administrative Agent, as the case may be, to determine (A) whether or not payments made hereunder
or under any other Loan Document are subject to Taxes, (B) if applicable, the required rate of
withholding or deduction, and (C) such Lender’s entitlement to any available exemption from, or
reduction of, applicable Taxes in respect of all payments to be made to such Lender by the
Borrower pursuant to this Agreement or otherwise to establish such Lender’s status for
withholding tax purposes in the applicable jurisdiction.




          (ii) Without limiting the generality of the foregoing, if the Borrower is resident for
tax purposes in the United States,




          (A) any Lender that is a “United States person” within the meaning of Section
7701(a)(30) of the Code shall deliver to the Borrower and the Administrative Agent
executed originals of Internal Revenue Service Form W-9 or such other documentation
or information prescribed by applicable Laws or reasonably requested by the Borrower
or the Administrative Agent as will enable the Borrower or the Administrative Agent,
as the case may be, to determine whether or not such Lender is subject to backup
withholding or information reporting requirements; and




          (B) each Foreign Lender that is entitled under the Code or any applicable
treaty to an exemption from or reduction of withholding tax with respect to payments
hereunder or under any other Loan Document 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) executed originals 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) executed originals of Internal Revenue Service Form W-8ECI,




          (III) executed originals of Internal Revenue Service Form W-8IMY and
all required supporting documentation,




          (IV) 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



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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) executed originals of Internal Revenue
Service Form W-8BEN, or




          (V) executed originals of any other form prescribed by applicable Laws
as a basis for claiming exemption from or a reduction in United States
Federal withholding tax together with such supplementary documentation as
may be prescribed by applicable Laws to permit the Borrower or the
Administrative Agent to determine the withholding or deduction required to
be made.




          (iii) Each Lender shall promptly (A) notify the Borrower and the Administrative Agent of
any change in circumstances which would modify or render invalid any claimed exemption or
reduction, and (B) take such steps as shall not be materially disadvantageous to it, in the
reasonable judgment of such Lender, and as may be reasonably necessary (including the
re-designation of its Lending Office) to avoid any requirement of applicable Laws of any
jurisdiction that the Borrower or the Administrative Agent make any withholding or deduction
for taxes from amounts payable to such Lender.


          (f) Treatment of Certain Refunds. Unless required by applicable Laws, at no time
shall the Administrative Agent have any obligation to file for or otherwise pursue on behalf of a
Lender or the L/C Issuer, or have any obligation to pay to any Lender or the L/C Issuer, any
refund of Taxes withheld or deducted from funds paid for the account of such Lender or the L/C
Issuer, as the case may be. If the Administrative Agent, any Lender or the L/C Issuer receives 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 incurred by the
Administrative Agent, such Lender or the L/C Issuer, 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 the L/C Issuer, 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 the L/C Issuer in the event the Administrative Agent, such
Lender or the L/C Issuer is required to repay such refund to such Governmental Authority. This
subsection shall not be construed to require the Administrative Agent, any Lender or the L/C
Issuer to make available its tax returns (or any other information relating to its taxes that it
deems confidential) to the Borrower or any other Person.


          3.02 Illegality. If any Lender determines that any Law has made it unlawful, or that any
Governmental Authority has asserted that it is unlawful, for any Lender or its applicable



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Lending
Office to make, maintain or fund Eurodollar Rate Loans, or to determine or charge interest rates
based upon the Eurodollar Rate, or any Governmental Authority has imposed material restrictions on
the authority of such Lender to purchase or sell, or to take deposits of, Dollars in the London
interbank market, then, on notice thereof by such Lender to the Borrower through the Administrative
Agent, any obligation of such Lender to make or continue Eurodollar Rate Loans or to convert Base
Rate Loans to Eurodollar Rate Loans shall be suspended until such Lender notifies the
Administrative Agent and the Borrower that the circumstances giving rise to such determination no
longer exist. Upon receipt of such notice, the Borrower shall, upon demand from such Lender (with
a copy to the Administrative Agent), prepay or, if applicable, convert all Eurodollar Rate Loans of
such Lender to Base Rate Loans, either on the last day of the Interest Period therefor, if such
Lender may lawfully continue to maintain such Eurodollar Rate Loans to such day, or immediately, if
such Lender may not lawfully continue to maintain such Eurodollar
Rate Loans. Upon any such prepayment or conversion, the Borrower shall also pay accrued interest
on the amount so prepaid or converted.



          3.03 Inability to Determine Rates. If the Required Lenders determine that for any reason in
connection with any request for a Eurodollar Rate Loan or a conversion to or continuation thereof
that (a) Dollar deposits are not being offered to banks in the London interbank eurodollar market
for the applicable amount and Interest Period of such Eurodollar Rate Loan, (b) adequate and
reasonable means do not exist for determining the Eurodollar Rate for any requested Interest Period
with respect to a proposed Eurodollar Rate Loan, or (c) the Eurodollar Rate for any requested
Interest Period with respect to a proposed Eurodollar Rate Loan does not adequately and fairly
reflect the cost to such Lenders of funding such Loan, the Administrative Agent will promptly so
notify the Borrower and each Lender. Thereafter, the obligation of the Lenders to make or maintain
Eurodollar Rate Loans shall be suspended until the Administrative Agent (upon the instruction of
the Required Lenders) revokes such notice. Upon receipt of such notice, the Borrower may revoke
any pending request for a Borrowing of, conversion to or continuation of Eurodollar Rate Loans or,
failing that, will be deemed to have converted such request into a request for a Borrowing of Base
Rate Loans in the amount specified therein.


          3.04 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 credit extended or participated in by, any Lender (except any reserve requirement
reflected in the Eurodollar Rate) or the L/C Issuer;




          (ii) subject any Lender or the L/C Issuer 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 Eurodollar Rate Loan made by it, or change the basis of taxation of payments to such
Lender or the L/C Issuer in respect thereof (except for Indemnified Taxes or Other Taxes
covered by Section 3.01 and the imposition of, or any change in the rate of, any
Excluded Tax payable by such Lender or the L/C Issuer); or



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          (iii) impose on any Lender or the L/C Issuer or the London interbank market any other
condition, cost or expense affecting this Agreement or Eurodollar 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 or
maintaining any Eurodollar Rate Loan (or of maintaining its obligation to make any such Loan), or
to increase the cost to such Lender or the L/C Issuer of participating in, issuing or maintaining
any Letter of Credit (or of maintaining its obligation to participate in or to issue any Letter of
Credit), or to reduce the amount of any sum received or receivable by such Lender or the L/C Issuer
hereunder (whether of principal, interest or any other amount) then, upon request of such
Lender or the L/C Issuer, the Borrower will pay to such Lender or the L/C Issuer, as the case may
be, such additional amount or amounts as will compensate such Lender or the L/C Issuer, as the case
may be, for such additional costs incurred or reduction suffered.





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




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




          (d) Delay in Requests. Failure or delay on the part of any Lender or the L/C Issuer
to demand compensation pursuant to the foregoing provisions of this Section shall not constitute
a waiver of such Lender’s or the L/C Issuer’s right to demand such compensation, provided
that the Borrower shall not be required to compensate a Lender or the L/C Issuer pursuant to the
foregoing provisions of this Section for any increased costs incurred or reductions suffered more
than nine months prior to the date that such Lender or the L/C Issuer, 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 the L/C Issuer’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).



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          3.05 Compensation for Losses. Upon demand of any Lender (with a copy to the Administrative Agent)
from time to time, the Borrower shall promptly compensate such Lender for and hold such Lender
harmless from any loss, cost or expense incurred by it as a result of:




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




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




          (c) any assignment of a Eurodollar Rate Loan on a day other than the last day of the
Interest Period therefor as a result of a request by the Borrower pursuant to
Section 11.13;



including any loss of anticipated profits and any loss or expense arising from the liquidation or
reemployment of funds obtained by it to maintain such Loan or from fees payable to terminate the
deposits from which such funds were obtained. The Borrower shall also pay any customary
administrative fees charged by such Lender in connection with the foregoing.




For purposes of calculating amounts payable by the Borrower to the Lenders under this Section
3.05, each Lender shall be deemed to have funded each Eurodollar Rate Loan made by it at the
Eurodollar Base Rate used in determining the Eurodollar Rate for such Loan by a matching deposit or
other borrowing in the London interbank eurodollar market for a comparable amount and for a
comparable period, whether or not such Eurodollar Rate Loan was in fact so funded.



          3.06 Mitigation Obligations; Replacement of Lenders.




          (a) Designation of a Different Lending Office. If any Lender requests compensation
under Section 3.04, or the Borrower is required to pay any additional amount to any
Lender, the L/C Issuer, or any Governmental Authority for the account of any Lender or the L/C
Issuer pursuant to Section 3.01, or if any Lender gives a notice pursuant to Section
3.02, then such Lender or the L/C Issuer shall, as applicable, 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 or the L/C Issuer, such designation or assignment (i) would eliminate or
reduce amounts payable pursuant to Section 3.01 or 3.04, as the case may be, in
the future, or eliminate the need for the notice pursuant to Section 3.02, as applicable,
and (ii) in each case, would not subject such Lender or the L/C Issuer, as the case may be, to
any unreimbursed cost or expense.




          (b) Replacement of Lenders. If any Lender requests compensation under
Section 3.04, 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 3.01, the
Borrower may replace such Lender in accordance with Section 11.13.



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          3.07 Survival. All of the Borrower’s obligations under this Article III shall survive
termination of the Aggregate Commitments, repayment of all other Obligations hereunder, and
resignation of the Administrative Agent.



ARTICLE IV

CONDITIONS PRECEDENT TO CREDIT EXTENSIONS



          4.01 Conditions of Initial Credit Extension. The obligation of the L/C Issuer and each Lender to
make its initial Credit Extension hereunder is subject to satisfaction of the following conditions
precedent:




          (a) The Administrative Agent’s receipt of the following, each of which shall be originals or
telecopies (followed promptly by originals) unless otherwise specified, each properly executed by
a Responsible Officer of the signing Loan Party, each dated the Closing Date (or, in the case of
certificates of governmental officials, a recent date before the Closing Date) and each in form
and substance satisfactory to the Administrative Agent and each of the Lenders:




          (i) counterparts of this Agreement executed by Borrower and Holdings, sufficient in
number for distribution to the Administrative Agent, each Lender and the Borrower;




          (ii) the Guaranties executed by each of the Guarantors;




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




          (iv) such documents and certifications as the Administrative Agent may reasonably
require to evidence that each Loan Party is duly organized or formed, validly existing, in
good standing and qualified to engage in business in each jurisdiction where its ownership,
lease or operation of properties or the conduct of its business requires such qualification;




          (v) a favorable opinion of Varner & Brandt LLP, counsel to the Loan Parties, addressed
to the Administrative Agent and each Lender, as to such matters concerning the Loan Parties
and the Loan Documents as the Administrative Agent may reasonably request;




          (vi) a certificate of a Responsible Officer of each Loan Party either (A) attaching
copies of all consents, licenses and approvals required in connection with the execution,
delivery and performance by such Loan Party and the validity against such Loan Party of the
Loan Documents to which it is a party, and such consents, licenses and approvals shall be in
full force and effect, or (B) stating that no such consents, licenses or approvals are so
required;



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          (vii) a certificate signed by a Responsible Officer of the Borrower certifying (A) that
the conditions specified in Sections 4.02(a) and (b) have been satisfied and
(B) that there has been no event or circumstance since the date of the Audited Financial
Statements that has had or could be reasonably expected to have, either individually or
in the aggregate, a Material Adverse Effect; and




          (viii) such other assurances, certificates, documents, consents or opinions as the
Administrative Agent, the L/C Issuer or the Required Lenders reasonably may require.




          (b) Unless waived by the Administrative Agent, the Borrower shall have paid all fees,
charges and disbursements of counsel to the Administrative Agent (directly to such counsel if
requested by the Administrative Agent) to the extent invoiced prior to or on the Closing Date,
plus such additional amounts of such fees, charges and disbursements as shall constitute its
reasonable estimate of such fees, charges and disbursements incurred or to be incurred by it
through the closing proceedings (provided that such estimate shall not thereafter preclude a
final settling of accounts between the Borrower and the Administrative Agent).


          Without limiting the generality of the provisions of the last paragraph of Section
10.03, for purposes of determining compliance with the conditions specified in this Section
4.01, 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.


          4.02 Conditions to all Credit Extensions. The obligation of each Lender to honor any Request for
Credit Extension (other than a Loan Notice requesting only a conversion of Loans to the other Type,
or a continuation of Eurodollar Rate Loans) is subject to the following conditions precedent:




          (a) The representations and warranties of the Borrower contained in Article V or any
other Loan Document, or which are contained in any document furnished at any time under or in
connection herewith or therewith, shall be true and correct on and as of the date of such Credit
Extension, except to the extent that such representations and warranties specifically refer to an
earlier date, in which case they shall be true and correct as of such earlier date, and except
that for purposes of this Section 4.02, the representations and warranties contained in
Section 5.04(a) shall be deemed to refer to the most recent statements furnished pursuant
to Section 6.01.




          (b) No Default shall exist, or would result from such proposed Credit Extension or from the
application of the proceeds thereof.




          (c) The Administrative Agent and, if applicable, the L/C Issuer shall have received a
Request for Credit Extension in accordance with the requirements hereof.


          Each Request for Credit Extension (other than a Loan Notice requesting only a conversion of
Loans to the other Type or a continuation of Eurodollar Rate Loans) submitted by the Borrower shall
be deemed to be a representation and warranty that the conditions specified in



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Sections 4.02(a) and (b) have been satisfied on and as of the date of the
applicable Credit Extension.




ARTICLE V

REPRESENTATIONS AND WARRANTIES



          As of the Closing Date, each of Holdings and the Borrower represents and warrants to the
Administrative Agent and the Lenders and, as of each subsequent date, Borrower represents and
warrants to the Administrative Agent and the Lenders that:


          5.01 Existence, Qualification and Power. Each Loan Party is duly organized or formed, validly
existing and in good standing under the Laws of the state of its incorporation or organization, has
the power and authority and the legal right to own and operate its properties, to lease the
properties it operates and to conduct its business, is duly qualified and in good standing under
the Laws of each jurisdiction where its ownership, lease or operation of properties or the conduct
of its business requires such qualification, and is in compliance with all Laws except to the
extent that noncompliance could not reasonably be expected to have a Material Adverse Effect.


          5.02 Power; Authorization; Enforceable Obligations. Each Loan Party has the power and authority
and the legal right to make, deliver and perform each Loan Document to which it is a party. The
Borrower has the power and authority to borrow hereunder and has taken all necessary action to
authorize the borrowings on the terms and conditions of this Agreement. Each Loan Party has taken
all necessary action to authorize the execution, delivery and performance of this Agreement and the
other Loan Documents to which it is a party. No consent or authorization of, filing with, or other
act by or in respect of any Governmental Authority, is required in connection with the borrowings
hereunder or with the execution, delivery, performance, validity or enforceability of this
Agreement or any of the other Loan Documents. The Loan Documents have been duly executed and
delivered by each applicable Loan Party and constitute a legal, valid and binding obligation of
each applicable Loan Party, enforceable against each applicable Loan Party in accordance with their
respective terms.


          5.03 No Legal Bar. The execution, delivery, and performance by each Loan Party of the Loan
Documents to which it is a party and compliance with the provisions thereof have been duly
authorized by all requisite action on the part of such Loan Party and do not and will not (a)
violate or conflict with, or result in a breach of, or require any consent under (i) any
Organization Documents of such Loan Party or any of its Subsidiaries, (ii) any applicable Laws,
rules, or regulations or any order, writ, injunction, or decree of any Governmental Authority or
arbitrator, or (iii) any Contractual Obligation of such Loan Party or any of its Subsidiaries or by
which any of them or any of their property is bound or subject (including without limitation the
Senior Note Documents), (b) constitute a default under any such agreement or instrument, or (c)
result in, or require, the creation or imposition of any Lien on any of the properties of such Loan
Party or any of its Subsidiaries.



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          5.04 Financial Statements; No Material Adverse Effect.




          (a) The Audited Financial Statements (i) were prepared in accordance with GAAP consistently
applied throughout the period covered thereby, except as otherwise expressly noted therein; (ii)
fairly present the consolidated financial condition of Holdings and Borrower, respectively, as of
the date thereof, and their results of operations for the period covered thereby in accordance
with GAAP consistently applied throughout the period covered thereby, except as otherwise
expressly noted therein; and (iii) show all material indebtedness and other liabilities, direct
or contingent, of Holdings and its Subsidiaries and Borrower and its Subsidiaries, respectively,
as of the date thereof, including liabilities for taxes, material commitments and Indebtedness in
accordance with GAAP consistently applied throughout the period covered thereby.




          (b) Since the date of the Audited Financial Statements, there has been no event or
circumstance, either individually or in the aggregate, that has had or could reasonably be
expected to have a Material Adverse Effect.


          5.05 Litigation. No litigation, investigation or proceeding of or before an arbitrator or
Governmental Authority is pending or, to the knowledge of Borrower after due and diligent
investigation, threatened by or against any Loan Party or any of its Subsidiaries or against any of
their properties or revenues that (a) purport to affect or pertain to this Agreement or any other
Loan Document, or any of the transactions contemplated hereby, or (b) either individually or in the
aggregate, if determined adversely, could reasonably be expected to have a Material Adverse Effect.


          5.06 No Default. Neither any Loan Party nor any Subsidiary thereof is in default under or with
respect to any Contractual Obligation that could, either individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect. No Default has occurred and is
continuing or will result from the consummation of the transactions contemplated by this Agreement
or any other Loan Document or the making of the Credit Extensions hereunder.


          5.07 Ownership of Property; Liens. Each Loan Party and its Subsidiaries have valid fee simple to,
or valid leasehold interests in, all real property which they use in their respective businesses,
and each Loan Party and its Subsidiaries have good and marketable title to all of the other
property necessary or used in the ordinary conduct of their business, and none of such property is
subject to any Lien, except as permitted in Section 7.02.


          5.08 Taxes. Each Loan Party and its Subsidiaries have filed all tax returns which are
required to be filed, and have paid, or made provision for the payment of, all taxes with respect
to the periods,
property or transactions covered by said returns, or pursuant to any assessment received by
such Loan Party or its respective Subsidiaries, except (a) such taxes, if any, as are being
contested in good faith by appropriate proceedings and as to which adequate reserves have been
established and maintained in accordance with GAAP, and (b) immaterial taxes; provided,
however, that in each case no material item or portion of property of any Loan Party or any of its
Subsidiaries is in jeopardy of being seized, levied upon or forfeited.



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          5.09 Margin Regulations; Investment Company Act.




          (a) No Loan Party is engaged or will engage, principally or as one of its important
activities, in the business of purchasing or carrying margin stock (within the meaning of
Regulation U issued by the FRB), or extending credit for the purpose of purchasing or carrying
margin stock. No part of the proceeds of any Credit Extensions hereunder will be used for
“purchasing” or “carrying” “margin stock” as so defined or for any purpose which violates, or
which would be inconsistent with, the provisions of Regulations U or X of the FRB.




          (b) No Loan Party, any Person Controlling a Loan Party, or any Subsidiary of any Loan Party
is or is required to be registered as an “investment company” under the Investment Company Act of
1940.


          5.10 ERISA Compliance.




          (a) Each Plan is in compliance in all material respects with the applicable provisions of
ERISA, the Code and other Federal or state Laws. Each Plan that is intended to qualify under
Section 401(a) of the Code has received a favorable determination letter from the IRS or an
application for such a letter is currently being processed by the IRS with respect thereto and,
to the best knowledge of the Borrower, nothing has occurred which would prevent, or cause the
loss of, such qualification. The Borrower and each ERISA Affiliate have made all required
contributions to each Plan in compliance with the Pension Funding Rules, and no application for a
funding waiver or an extension of any amortization period pursuant to the Pension Funding Rules
has been made with respect to any Plan.




          (b) There are no pending or, to the best knowledge of the Borrower, threatened claims,
actions or lawsuits, or action by any Governmental Authority, with respect to any Plan that could
reasonably be expected to have a Material Adverse Effect. There has been no prohibited
transaction or violation of the fiduciary responsibility rules with respect to any Plan that has
resulted or could reasonably be expected to result in a Material Adverse Effect.




          (c) (i) No ERISA Event has occurred or is reasonably expected to occur; (ii) the aggregate
amount of Unfunded Pension Liability among all Pension Plans does not exceed $35,000,000; (iii)
neither the Borrower nor any ERISA Affiliate has incurred, or reasonably expects to incur, any
liability under Title IV of ERISA with respect to any Pension Plan (other than premiums due and
not delinquent under Section 4007 of ERISA); (iv) neither the
Borrower nor any ERISA Affiliate has incurred, or reasonably expects to incur, any liability
(and no event has occurred which, with the giving of notice under Section 4219 of ERISA, would
result in such liability) under Sections 4201 or 4243 of ERISA with respect to a Multiemployer
Plan; and (v) neither the Borrower nor any ERISA Affiliate has engaged in a transaction that
could be subject to Sections 4069 or 4212(c) of ERISA.


          5.11 Intangible Assets. Each Loan Party and its Subsidiaries own, or possess the right to use, all
trademarks, trade names, copyrights, patents, patent rights, franchises, licenses and other
intangible assets that are used in the conduct of their respective businesses as now operated, and
none of such items, to the best knowledge of Borrower, conflicts with the valid



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trademark, trade
name, copyright, patent, patent right or intangible asset of any other Person to the extent that
such conflict could reasonably be expected to have a Material Adverse Effect.



          5.12 Compliance with Laws. Each Loan Party and its Subsidiaries are in compliance with all Laws
and all orders, writs, injunctions and decrees applicable to them or their respective properties,
except in such instances in which the failure to comply therewith, either individually or in the
aggregate, could not reasonably be expected to have a Material Adverse Effect.


          5.13 Environmental Compliance. Each Loan Party and its Subsidiaries conduct in the ordinary course
of business a review of the effect of existing Environmental Laws and claims alleging potential
liability or responsibility for violation of any Environmental Law on their respective businesses,
operations and properties, and as a result thereof the Borrower has reasonably concluded that such
Environmental Laws and claims could not, individually or in the aggregate, reasonably be expected
to have a Material Adverse Effect.


          5.14 Insurance. The properties of each Loan Party and its Subsidiaries are insured with
financially sound and reputable insurance companies not Affiliates of the Borrower, in such
amounts, with such deductibles and covering such risks as are customarily carried by companies
engaged in similar businesses and owning similar properties in localities where such Loan Party or
such Subsidiary operates.


          5.15 Stockholders Agreements. As of the Closing Date, there are no stockholder agreements with
respect to stock of Holdings or Borrower to which Holdings, Borrower or any members of their senior
management are parties.


          5.16 Disclosure. No statement, information, report, representation, or warranty made by any Loan Party in any
Loan Document or furnished to Administrative Agent or any Lender in connection with any Loan
Document contains any untrue statement of a material fact or omits to state any material fact
necessary to make the statements herein or therein not misleading.


          5.17 Subsidiaries; Equity Interests. As of the Closing Date, the Loan Parties do not have any
Subsidiaries other than those specifically disclosed on Schedule 5.17, and all of the
outstanding Equity Interests in such Subsidiaries have been validly issued, are fully paid and
nonassessable and are owned by a Loan Party in the amounts specified on Schedule 5.17 free
and clear of all Liens.



ARTICLE VI

AFFIRMATIVE COVENANTS OF BORROWER



          So long as any Lender shall have any Commitment hereunder, any Loan or other Obligation
hereunder shall remain unpaid or unsatisfied, or any Letter of Credit shall remain outstanding, the
Borrower shall, and shall (except in the case of the covenants set forth in Sections 6.01
and 6.02) cause each Subsidiary to:


          6.01 Financial Statements. Deliver to the Administrative Agent in form and detail satisfactory to
the Administrative Agent and the Required Lenders, with sufficient copies for each Lender:




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     (a) as soon as available, but in any event within 120 days after the end of each Fiscal
Year:




          (i) a consolidated balance sheet of Holdings and its Subsidiaries as at the end of such
Fiscal Year, and the related consolidated statements of income and cash flows for such
Fiscal Year, all in reasonable detail, setting forth in comparative form, in the case of the
balance sheet and income statement, the results of operation from the preceding Fiscal Year;
and




          (ii) a consolidated balance sheet of Borrower and its Subsidiaries as at the end of
such Fiscal Year, and the related consolidated statements of income and cash flows for such
Fiscal Year, setting forth in comparative form, in the case of the balance sheet and income
statement, the results of operation from the preceding Fiscal Year.


Each of the financial statements delivered pursuant to this clause (a) shall be audited and
accompanied by a report and opinion of an independent certified public accountant of nationally
recognized standing reasonably acceptable to the Required Lenders, which report and opinion shall
be prepared in accordance with GAAP and shall not be subject to any qualifications or exceptions as
to the scope of the audit nor to any qualifications and exceptions not reasonably acceptable to the
Required Lenders;





     (b) as soon as available, but in any event within 60 days after the end of each of the first
three Fiscal Quarters of each Fiscal Year, a consolidated balance sheet of Holdings and its
Subsidiaries as at the end of such Fiscal Quarter, and the related consolidated statements of
income and cash flows for such Fiscal Quarter and for the portion of the Fiscal Year then ended,
setting forth in each case in comparative form the figures for the corresponding Fiscal Quarter
of the previous Fiscal Year, the corresponding portion of the previous Fiscal Year and the
corresponding figures from the projections delivered to the Lenders on or prior to the Closing
Date or from the Financial Plan, as applicable, for the Fiscal Quarter and portion of the Fiscal
Year then ended covered by such financial statements, all in reasonable detail and certified by
the chief executive officer, chief financial officer, treasurer or controller of Holdings as
fairly presenting the financial condition, results of operations and cash flows of Holdings and
its Subsidiaries in accordance with GAAP, subject only to normal year-end audit adjustments and
the absence of footnotes; and




     (c) as soon as practicable and in any event no later than 90 days after the end of each
Fiscal Year, a consolidated plan and financial forecast for such Fiscal Year and the next two
succeeding Fiscal Years (the “Financial Plan” for such Fiscal Years), including without
limitation (i) forecasted consolidated balance sheets and forecasted consolidated statements of
income and cash flows of Holdings and its Subsidiaries for each of the next three Fiscal Years,
and projected capital expenditures for such Fiscal Year, and (ii) such other information and
projections as any Lender may reasonably request.


As to any information contained in materials furnished pursuant to Section 6.02(c), the
Loan Parties shall not be separately required to furnish

such information under clause (a)(i) or
(b) above, but the foregoing shall not be in derogation of the obligation of the Borrower to
furnish
 

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the information and materials described in clauses (a)(i) and (b) above at the times
specified therein.




     6.02 Certificates; Notices and Other Information. Deliver to Administrative Agent in form and
detail satisfactory to Administrative Agent and the Required Lenders, with sufficient copies for
each Lender:



     (a) concurrently with the delivery of the financial statements referred to in
Sections 6.01(a) and (b), a duly completed Compliance Certificate signed by the
chief executive officer, chief financial officer, treasurer or controller of the Borrower and
Holdings and a reconciliation of intercompany transactions between Holdings and Borrower and
Borrower’s Subsidiaries;




     (b) promptly after any request by the Administrative Agent or any Lender, copies of any
detailed audit reports, management letters or recommendations submitted to the board of directors
(or the audit committee of the board of directors) of Holdings or Borrower by independent
accountants in connection with the accounts or books of Holdings or any of its Subsidiaries, or
any audit of any of them;




     (c) promptly after request by Administrative Agent or any Lender, copies of any annual,
regular, periodic and special reports and registration statements which Holdings may file or be
required to file with the SEC under Sections 13 or 15(d) of the Exchange Act;




     (d) promptly, and in any event within five Business Days after receipt thereof by any Loan
Party or any Subsidiary thereof, copies of each notice or other correspondence received from the
SEC (or comparable agency in any applicable non-U.S. jurisdiction) concerning any investigation
or possible investigation or other inquiry by such agency regarding financial or other
operational results of any Loan Party or any Subsidiary thereof;




     (e) promptly after the occurrence thereof, notice of any Default or Event of Default;




     (f) notice of any material change in accounting policies or financial reporting practices by
any Loan Party or any of its Subsidiaries;




     (g) promptly after the commencement thereof, notice of any litigation, investigation or
proceeding involving any Loan Party where the amount involved exceeds $7,500,000, or in which
injunctive relief or similar relief is sought, which relief, if granted, could reasonably be
expected to result in a Material Adverse Effect;




     (h) promptly after the occurrence thereof, notice of any ERISA Event;




     (i) promptly after the occurrence thereof, notice of any matter or circumstance that has
resulted or could reasonably be expected to result in a Material Adverse Effect;




     (j) promptly after the execution thereof, copies of all amendments, waivers and supplemental
indentures made with respect to the Senior Note Indentures or the Senior Notes;



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     (k) promptly after the receipt by Borrower or any of its Subsidiaries thereof, notice of
claim or notice to the effect that Borrower of any of its Subsidiaries is in default under any of
its leases of real property; and




     (l) promptly, such other data and information as from time to time may be reasonably
requested by Administrative Agent, or, through Administrative Agent or any Lender.



     Each notice pursuant to clauses (d) through (i) and (k) of this Section 6.02 shall be
accompanied by a statement of a Responsible Officer of the Borrower setting forth details of the
occurrence referred to therein and stating what action the Borrower has taken and proposes to take
with respect thereto.



     Documents required to be delivered pursuant to Section 6.01(a) or (b) or
Section 6.02(c) (to the extent any such documents are included in materials otherwise filed
with the SEC) may be delivered electronically and if so delivered, shall be deemed to have been
delivered on the date (i) on which the Borrower posts such documents, or provides a link thereto on
the Borrower’s website on the Internet at the website address listed on Schedule 11.02; or
(ii) on which such documents are posted on the Borrower’s behalf on an Internet or intranet
website, if any, to which each Lender and the Administrative Agent have access (whether a
commercial, third-party website or whether sponsored by the Administrative Agent); provided
that: (i) the Borrower shall deliver paper copies of such documents to the Administrative Agent or
any Lender that requests the Borrower to deliver such paper copies until a written request to cease
delivering paper copies is given by the Administrative Agent or such Lender and (ii) the Borrower
shall notify the Administrative Agent and each Lender (by telecopier or electronic mail) of the
posting of any such documents and provide to the Administrative Agent by electronic mail electronic
versions (i.e., soft copies) of such documents. Notwithstanding anything contained herein,
in every instance the Borrower shall be required to provide paper copies of the Compliance
Certificates required by Section 6.02(a) to the Administrative Agent. Except for such
Compliance Certificates, the Administrative Agent shall have no obligation to request the delivery
or to maintain copies of the documents referred to above, and in any event shall have no
responsibility to monitor compliance by the Borrower with any such request for delivery, and each
Lender shall be solely responsible for requesting delivery to it or maintaining its copies of such
documents.



     The Borrower hereby acknowledges that (a) 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 IntraLinks or another similar electronic system (the “Platform”) and
(b) certain of the Lenders (each, a “Public Lender”) may have personnel who do not wish to
receive material non-public information with respect to the Borrower or its Affiliates, or the
respective securities of any of the foregoing, and who may be engaged in investment and other
market-related activities with respect to such Persons’ securities. The Borrower hereby agrees
that (w) all Borrower Materials that are to be made available to Public Lenders shall be
clearly and conspicuously marked “PUBLIC” which, at a minimum, shall mean that the word
“PUBLIC” shall appear prominently on the first page thereof; (x) by marking Borrower Materials
“PUBLIC,” the Borrower shall be deemed to have authorized the Administrative



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Agent, the Arranger,
the L/C Issuer and the Lenders to treat such Borrower Materials as not containing any material
non-public information with respect to the Borrower or its securities for purposes of United States
Federal and state securities laws (provided, however, that to the extent such
Borrower Materials constitute Information, they shall be treated as set forth in Section
11.07); (y) all Borrower Materials marked “PUBLIC” are permitted to be made available
through a portion of the Platform designated “Public Side Information;” and (z) the Administrative
Agent and the Arranger shall be entitled to treat any Borrower Materials that are not marked
“PUBLIC” as being suitable only for posting on a portion of the Platform that is not designated
“Public Side Information.”



     6.03 Payment of Obligations. Pay and discharge when due all taxes, assessments, governmental
charges, Ordinary Course Liens or levies imposed on any Loan Party or its Subsidiaries or on its
income or profits or any of its property, except for any such tax, assessment, charge, or levy
which is an Ordinary Course Lien under subsection (a) or (b) of the definition of such term,
provided that the failure to pay any such taxes, assessments, governmental charges,
Ordinary Course Liens or levies shall not be deemed to violate this covenant if the amount involved
is less than $5,000,000.



     6.04 Preservation of Existence, Etc. Preserve and maintain its existence, good standing, licenses,
permits, rights, franchises and privileges necessary or desirable in the normal conduct of its
business, except where failure to do so could not reasonably be expected to have a Material Adverse
Effect.



     6.05 Maintenance of Properties. Maintain, preserve and protect all of its material properties and
equipment necessary in the operation of its business in good order and condition, subject to wear
and tear in the ordinary course of business, and not permit any waste of its properties.



     6.06 Maintenance of Insurance. Maintain liability and casualty insurance with financially sound
and reputable insurance companies which are not affiliated with the Borrower in such amounts and
against such risks as is customary for similarly situated businesses.



     6.07 Compliance with Laws.




     (a) Comply with the requirements of all applicable Laws and orders of any Governmental
Authority, noncompliance with which could reasonably be expected to have a Material Adverse
Effect.




     (b) Conduct its operations and keep and maintain its property in material compliance with
all Environmental Laws.



     6.08 Inspection Rights. At any time during regular business hours and as often as reasonably
requested, permit Administrative Agent or any Lender, or any employee, agent or representative
thereof, to examine, audit and make copies and abstracts from the Loan Parties’ records and books
of account and to visit and inspect their properties and to discuss their affairs, finances and
accounts with any of their officers and key employees, and, upon request, furnish promptly to
Administrative Agent or any Lender true copies of all financial information and internal management
reports made available to their senior management; provided, however, that



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when an
Event of Default exists the Administrative Agent or any Lender (or any of their respective
employees, agents or representatives) may do any of the foregoing at the expense of the Borrower.



     6.09 Books and Records. Keep adequate records and books of account reflecting all financial
transactions in conformity with GAAP, consistently applied, and in material conformity with all
applicable requirements of any Governmental Authority having regulatory jurisdiction over any Loan
Party or any of its Subsidiaries.



     6.10 Compliance with ERISA. Cause, and cause each of its ERISA Affiliates to: (a) maintain each
Plan in compliance in all material respects with the applicable provisions of ERISA, the Code and
other federal or state law; (b) cause each Plan which is qualified under Section 401(a) of the Code
to maintain such qualification; and (c) make all required contributions to any Plan in compliance
with the Pension Funding Rules.



     6.11 Compliance With Agreements. Promptly and fully comply with all Contractual Obligations under
all material agreements, indentures, leases and/or instruments to which any Loan Party or any one
or more of them is a party, except for any such Contractual Obligations (a) the performance of
which would cause a Default, or (b) if the failure to comply therewith could not reasonably be
expected to have a Material Adverse Effect.



     6.12 Use of Proceeds. Use the proceeds of Credit Extensions for lawful working capital and general
corporate purposes of Borrower and its Subsidiaries not otherwise in contravention of this
Agreement, including the making of Restricted Payments which are expressly permitted hereby.



     6.13 Further Assurances. Execute and file all such further instruments, and perform such other acts, as the
Administrative Agent or the Required Lenders may determine are reasonably necessary to effectuate
the intent of the Loan Documents.



     6.14 Execution of Guaranty by Future Material Subsidiaries.




     (a) In the event that any Person becomes a Material Subsidiary of Holdings or Borrower after
the date hereof, Borrower will promptly notify Administrative Agent of that fact and promptly
(and in any event within 30 days) cause such Subsidiary to execute and deliver to Administrative
Agent a Guaranty of the Obligations.




     (b) Borrower shall deliver or cause to be delivered to Administrative Agent, together with
such Guaranty, (i) certified copies of such Subsidiary’s Certificate or Articles of
Incorporation, Organization or Formation, together with a good standing certificate from the
Secretary of State of the jurisdiction of its incorporation, organization or formation and each
other state in which such Person is qualified as a foreign corporation to do business and, to the
extent generally available, a certificate or other evidence of good standing as to payment of any
applicable franchise or similar taxes from the appropriate taxing authority of each of such
jurisdictions, each to be dated a recent date prior to their delivery to Administrative Agent,
(ii) a copy of such Subsidiary’s bylaws, operating agreement, partnership agreement or other
similar Organization Document, certified by its secretary or an assistant secretary or other
Responsible Officer as of a recent date prior to their delivery to Administrative Agent, (iii) a



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certificate executed by the secretary or an assistant secretary or other Responsible Officer of
such Subsidiary certifying (a) that the resolutions attached to such certificate of such
Subsidiary approving and authorizing the execution, delivery and performance of the Guaranty are
in full force and effect and have not been modified or amended and (b) the incumbency and
signatures of the officers of such Subsidiary executing such Guaranty, and (iv) a favorable
opinion of counsel to such Subsidiary, in form and substance satisfactory to Administrative Agent
and its counsel, as to (a) the due organization and good standing of such Subsidiary, (b) the due
authorization, execution and delivery by such Subsidiary of such Guaranty, (c) the enforceability
of such Guaranty against such Subsidiary, (d) such other matters as Administrative Agent may
reasonably request, all of the foregoing to be satisfactory in form and substance to
Administrative Agent and its counsel.



ARTICLE VII

NEGATIVE COVENANTS




     So long as any Lender shall have any Commitment hereunder, any Loan or other Obligation
hereunder shall remain unpaid or unsatisfied, or any Letter of Credit shall remain outstanding, the
Borrower shall not, nor shall it permit any Subsidiary to, directly or indirectly:



     7.01 Indebtedness. Create, incur, assume or suffer to exist any Indebtedness, except:




     (a) Indebtedness hereunder and under the other Loan Documents;




     (b) Guarantees issued in respect of the Senior Notes by Borrower and by the Subsidiaries of
Borrower which have issued Guaranties in respect of the Obligations under this Agreement and the
other Loan Documents;




     (c) Obligations in respect of Ordinary Course Indebtedness;




     (d) Indebtedness outstanding on the date hereof and listed on Schedule 7.01; and any
refinancings, refundings, renewals or extensions thereof (in whole or in part), provided
that the amount of such Indebtedness is not increased at the time of such refinancing, refunding,
renewal or extension except by an amount equal to the premium or other amount paid, and fees and
expenses incurred, in connection with such refinancing and by an amount equal to any utilized
commitments thereunder;




     (e) Indebtedness owed by Borrower or any of its Subsidiaries under or in respect of
(i) capital leases or (ii) Indebtedness incurred for the acquisition, construction or refinance
of real property constructed or acquired within the 12-month period preceding the incurrence of
such Indebtedness, and (iii) any refinancings, refundings, renewals or extensions of any
Indebtedness permitted under this clause (e), provided that the amount of any such
Indebtedness is not increased at the time of such refinancing, refunding, renewal or extension
except by an amount equal to the premium or other amount paid, and fees and expenses incurred, in
connection with such refinancing and by an amount equal to any utilized commitments thereunder;
and provided, further, that the aggregate principal amount of all Indebtedness
permitted under this clause (e) (including, for this purpose, the aggregate principal amount of
all Indebtedness described in this clause (e) listed on Schedule 7.01 or otherwise
permitted under clause (d) above) shall not at any time exceed $50,000,000;



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     (f) Indebtedness owed under Swap Contracts entered into for the purpose of hedging against
fluctuations in interest rates payable in respect of the Obligations owed hereunder;




     (g) Indebtedness owed to Borrower or any Wholly-Owned Subsidiary of Borrower that is a
Guarantor; and




     (h) other unsecured Indebtedness not exceeding $5,000,000 in the aggregate at any time.



     7.02 Liens and Negative Pledges. Create, incur, assume or suffer to exist, any Lien or Negative
Pledge upon any of its property, assets or revenues, whether now owned or hereafter acquired,
except:




     (a) Liens and Negative Pledges in favor of the Administrative Agent or the Lenders under
this Agreement or the Loan Documents;




     (b) The Negative Pledge set forth in the Senior Note Indentures as of the Closing Date,
provided that the same shall not prohibit the granting of Liens to the Administrative
Agent and the Lenders to secure the Obligations;




     (c) Liens and Negative Pledges existing on the date hereof and listed on
Schedule 7.02 and any renewals or extensions thereof; provided that the
obligations secured or benefited thereby or the property covered thereby are not increased,
except as permitted by Section 7.01(d);




     (d) Ordinary Course Liens;




     (e) Liens securing the Indebtedness permitted under Section 7.01(e);
provided that (i) any Liens securing Indebtedness permitted under clause (i) of
Section 7.01(e) shall only extend to the property subject to the capital lease under
which such Indebtedness is owed, (ii) any Liens securing Indebtedness permitted under clause
(ii) of Section 7.01(e) shall only extend to the real property constructed, acquired or
refinanced during the 12-month period preceding the incurrence of such Indebtedness; and
(iii) any Liens securing Indebtedness permitted under clause (iii) of
Section 7.01(e) shall only extend to the property securing the Indebtedness being
refinanced, refunded, renewed or extended;


      (f) Negative Pledges set forth in the agreements or instruments governing the Indebtedness
permitted under Section 7.01(e); provided that (i) any such Negative Pledge with
respect to Indebtedness permitted under clause (i) of Section 7.01(e) shall only extend
to the property subject to the capital lease under which such Indebtedness is owed, (ii) any such
Negative Pledge with respect to Indebtedness permitted under clause (ii) of
Section 7.01(e) shall only extend to the real property constructed, acquired or
refinanced during the 12-month period preceding the incurrence of such Indebtedness; and
(iii) any such Negative Pledge with respect to Indebtedness permitted under clause (iii) of
Section 7.01(e) shall only extend to the property securing the Indebtedness being
refinanced, refunded, renewed or extended;




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     (g) Liens on property of a Person existing at the time such Person is merged with or into or
consolidated with Borrower or any Subsidiary of Borrower; provided that such Liens were
in existence prior to the contemplation of such merger or consolidation and do not extend to any
assets other than those of the Person merged into or consolidated with Borrower or the applicable
Subsidiary of Borrower;




     (h) Liens on property existing at the time of acquisition thereof by Borrower or any
Subsidiary of Borrower; provided that such Liens were in existence prior to the
contemplation of such acquisition and do not extend to any assets other than such acquired
property; and Liens incurred in the ordinary course of business to secure the payment of all or a
portion of the purchase price of goods held for sale; provided that such Liens do not
extend to any assets other than such goods;




     (i) Liens and Negative Pledges in favor of Borrower or any Subsidiary of Borrower; and




     (j) other Liens securing, and Negative Pledges relating to, Indebtedness in an aggregate
principal amount not to exceed $5,000,000 at any time.



     7.03 Fundamental Changes. Merge or consolidate with or into any Person or liquidate, wind-up or
dissolve itself, or permit or suffer to exist any liquidation or dissolution of any of its
Subsidiaries, except, that so long as no Default or Event of Default exists or would result
therefrom, any Subsidiary of Borrower may merge with (i) Borrower provided that Borrower shall be
the continuing or surviving corporation, (ii) with any one or more Subsidiaries of Borrower, and
(iii) with any joint ventures, partnerships and other Persons, so long as such joint ventures,
partnerships and other Persons will, as a result of making such merger and all other
contemporaneous related transactions, become a Subsidiary of Borrower; provided that when
any Wholly-Owned Subsidiary of Borrower is merging with another Subsidiary of Borrower or any other
Person (other than the Borrower or Holdings), the Wholly-Owned Subsidiary of Borrower shall be the
continuing or surviving Person; provided further that when any Subsidiary that is a
Guarantor is merging with another Subsidiary of Borrower or any other Person (other than the
Borrower or Holdings), the Guarantor shall be the continuing or surviving Person.



     7.04 Dispositions. Make any Dispositions, except:




     (a) Ordinary Course Dispositions;




     (b) Dispositions permitted by Section 7.03;




     (c) any Subsidiary of Borrower may sell all or substantially all of its assets (upon
voluntary liquidation or otherwise), to Borrower or any of its Subsidiaries; provided
that when any Wholly-Owned Subsidiary of Borrower is selling all or substantially all of its
assets to another Subsidiary of Borrower, the Subsidiary acquiring such assets shall be a
Wholly-Owned Subsidiary of Borrower; provided further that when any Subsidiary that is a
Guarantor is selling all or substantially all of its assets to another Subsidiary of Borrower,
the Subsidiary acquiring such assets shall be a Guarantor;



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     (d) Borrower and its Subsidiaries may make Dispositions in the ordinary course of business
(including, without limitation, Dispositions in the ordinary course of business of stores, the
inventory located therein and other property used in connection therewith) of assets having an
aggregate fair market value of not more than $25,000,000 in each four consecutive Fiscal Quarter
period; and




     (e) Dispositions of the proceeds from the sale of Santee Dairies, Inc., as required by the
Senior Note Indentures.



     7.05 Investments. Make any Investments, except:




     (a) Investments existing on the date hereof;




     (b) Ordinary Course Investments;




     (c) Investments consisting of advances to officers, directors and employees of Borrower and
its Subsidiaries for travel, entertainment, relocation and analogous ordinary business purposes
not exceeding $500,000 in the aggregate;




     (d) Investments permitted by Section 7.03; and




     (e) other Investments not exceeding $5,000,000 in the aggregate.



     7.06 Lease Obligations. Create or suffer to exist any obligations for the payment of rent for any
property under lease or agreement to lease, except:




     (a) leases in existence on the date hereof and any renewal, extension or refinancing thereof
to the extent such renewal, extension or refinancing is not prohibited by Section 7.01;




     (b) leases (other than capital leases) entered into or assumed by Borrower or any of its
Subsidiaries after the date hereof in the ordinary course of business; and




     (c) capital leases to the extent the Indebtedness thereunder is not prohibited by
Section 7.01.



     7.07 Restricted Payments. Make any Restricted Payments, except:




     (a) Borrower may make distributions to Holdings in an amount sufficient to make regularly
scheduled payments of interest on the Senior Notes as and when the same become due;




     (b) Borrower may make other distributions to Holdings in the amounts required to pay for
Holdings’ corporate overhead and similar expenses, not to exceed $2,000,000 in the aggregate in
any Fiscal Year;




     (c) Borrower may make Permitted Tax Distributions to Holdings; and




     (d) Borrower may make distributions to Holdings (other than those described in clauses (a)
through (c) above), provided that (i) after giving effect thereto no Default or Event of
Default has occurred and is continuing, (ii) after giving pro forma effect thereto and to any



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other distributions made since the last day of the then most recently ended Fiscal Quarter,
Borrower remains in pro forma compliance with Section 7.12; and (iii) such distributions
to Holdings, when aggregated with all other distributions made to Holdings (other than those
described in clauses (a) through (c) above) following June 30, 2004, do not in the aggregate
exceed the sum of (A) $25,000,000, plus (B) 50% of Consolidated Net Income for the period from
June 27, 2004 through the then most recently ended Fiscal Quarter.



     7.08 ERISA. At any time engage in a transaction which could be subject to Sections 4069 or
4212(c) of ERISA, or permit any Pension Plan to (a) engage in any non-exempt “prohibited
transaction” (as defined in Section 4975 of the Code); (b) fail to comply with ERISA or any other
applicable Laws; or (c) incur any material “accumulated funding deficiency” (as defined in Section
302 of ERISA), which, with respect to each event listed above, could reasonably be expected to have
a Material Adverse Effect.



     7.09 Change in Nature of Business. Make any material change in the nature of the business of any
Loan Party as conducted and as proposed to be conducted as of the date hereof.



     7.10 Transactions with Affiliates. Enter into any transaction of any kind with any Affiliate of
the Borrower other than arm’s-length transactions with Affiliates that are otherwise permitted
hereunder; provided that the foregoing restriction shall not apply to transactions between
Borrower and any of its Wholly-Owned Subsidiaries that are Guarantors or between any Wholly-Owned
Subsidiaries of the Borrower that are Guarantors.



     7.11 Hostile Acquisitions. Use the proceeds of any Credit Extension in connection with the
acquisition of a voting interest of five percent or more in any Person if such acquisition is
opposed by the board of directors or management of such Person unless (a) Borrower has
given Administrative Agent (who shall promptly notify each Lender) five Business Days’ prior notice
thereof and (b) no Lender shall have, within that period, notified Administrative Agent (who shall
promptly notify Borrower) that it does not consent to the use of the proceeds of such Credit
Extension for that purpose.



     7.12 Financial Covenants.




     (a) Shareholders’ Equity. Permit Shareholders’ Equity, as of the last day of any
Fiscal Quarter (the “Test Date”), to be less than the sum of (i) Shareholders’ Equity as of the
Fiscal Quarter ended on or about June 28, 2009 minus $50,000,000 plus (ii) 50% of the cumulative
amount of Consolidated Net Income for each Fiscal Quarter which has then occurred since the
Fiscal Quarter ended on or about June 28, 2009, as of the Test Date (with no deduction for a net
loss in any such Fiscal Quarter) plus (iii) 100% of the net cash proceeds to Holdings and its
Subsidiaries from any issuance of their equity securities following the Closing Date.




     (b) Consolidated EBITDA. Permit Consolidated EBITDA for the period of four
consecutive Fiscal Quarters ending on the last day of any Fiscal Quarter to be less than
$140,000,000.



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     (c) Loan Limitations. Permit the Outstanding Amount of the Loans or the Total
Outstandings, as applicable, to exceed, as of any date described in Section 2.01(b) the
amounts set forth in Section 2.01(b).



     7.13 Change in Auditors. Change the certified public accountants auditing the books of Borrower
without the consent of Required Lenders, other than any change to another independent certified
public accountant of nationally recognized standing reasonably acceptable to the Required Lenders.



     7.14 Amendments or Waivers of Senior Note Documents. Agree to any material amendment to, or agree
to waive any of its material rights under, any Senior Note Document, without in each case obtaining
the prior written consent of Required Lenders to such amendment or waiver.



     7.15 Use of Capital Contributions. Use any cash contributions to Borrower’s capital made by
Holdings for any purpose other than general corporate purposes, including working capital and short
term financing of capital expenditures.



     7.16 Use of Proceeds. Use the proceeds of any Credit Extension, whether directly or indirectly,
and whether immediately, incidentally or ultimately, to purchase or carry margin stock (within the
meaning of Regulation U of the FRB) or to extend credit to others for the purpose of purchasing or
carrying margin stock or to refund indebtedness originally incurred for such purpose.



ARTICLE VIII

HOLDINGS COVENANTS




     So long as any Lender shall have any Commitment hereunder, any Loan or other Obligation
hereunder shall remain unpaid or unsatisfied, or any Letter of Credit shall remain outstanding:



     8.01 Indebtedness. Holdings shall not create, incur, assume or suffer to exist, or permit any of
its Subsidiaries to create, incur, assume or suffer to exist, any Indebtedness, except:




     (a) Indebtedness owed under the Senior Notes in an aggregate principal amount not to exceed
$810,000,000, and Guarantees issued in respect thereof by Borrower and by
other Subsidiaries of Holdings which have issued Guaranties in respect of the Obligations
under this Agreement and the other Loan Documents;




     (b) Indebtedness incurred by or owed to Borrower or any Subsidiary of Borrower (but only to
the extent that the Borrower or its Subsidiaries are permitted to incur such Indebtedness under
Article VII), and Indebtedness owed to Development or any Subsidiary of Development;




     (c) The Guaranty by Development and Holdings of the Obligations under the Loan Documents;



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     (d) Indebtedness of the Loan Parties associated with the development of stores in an amount
not to exceed $20,000,000 per store, or $60,000,000 in the aggregate at any one time outstanding;
and




     (e) Indebtedness of Borrower and its Subsidiaries which is permitted by Section
7.01.



     8.02 Restricted Payments. Holdings shall not make any Restricted Payments, except that:




     (a) Holdings (i) may distribute to La Cadena or any La Cadena Successor any distributions
made to Holdings pursuant to Sections 7.07(c) and 7.07(d), and (ii) may redeem
shares of Holdings held by the Moseley Trusts with any distributions made to Holdings pursuant to
Section 7.07(d);




     (b) Holdings may make Restricted Payments to purchase, prepay, redeem or otherwise acquire
for value the Senior Notes from the proceeds of any distributions made to Holdings pursuant to
Section 7.07(d); and




     (c) Holdings may repurchase, redeem, acquire or retire for value any capital stock of
Holdings held by any key employee of Holdings or its Subsidiaries (other than any employee that
is a partner of or otherwise holds any equity interest in La Cadena or any La Cadena Successor)
upon any such person’s death, disability or termination of employment and pursuant to any
management equity subscription agreement, stock option agreement or other incentive compensation
plan or agreement entered into in the ordinary course of business; provided that the
aggregate price paid for all such repurchased, redeemed, acquired or retired capital stock shall
not exceed $1,000,000, which aggregate amount shall increase by $1,000,000 on each anniversary of
the Closing Date.



     8.03 Change in Nature of Business; Ownership of Assets. Holdings shall not:




     (a) engage in any business other than entering into and performing its obligations under and
in accordance with the Loan Documents and Senior Note Documents to which it is a party and
contracts or agreements to which it is a party on the Closing Date;




     (b) own any assets other than (i) the capital stock of Borrower and Development, (ii) cash
and cash equivalents, and (iii) promissory notes payable by Borrower to Holdings that are
otherwise permitted to be issued by Borrower hereunder; or




     (c) permit Development to engage in substantial business other than construction management
services and the development and construction of new stores and distribution centers (including
the ownership of prospective sites for new stores and activities ancillary thereto), or in any
event permit Development to engage in the wholesale or retail grocery business.



     8.04 Transactions with Affiliates. Holdings shall not enter into any transaction of any kind with
any Affiliate of Holdings other than arm’s-length transactions with Affiliates that are otherwise
permitted hereunder; provided that the foregoing restriction shall not apply to



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transactions between (i) Holdings and the Borrower, (ii) Holdings and any of its Wholly-Owned
Subsidiaries that are Guarantors, or (iii) any of Holdings’ Wholly-Owned Subsidiaries that are
Guarantors.



     8.05 Amendments or Waivers of Senior Note Documents. Holdings shall not amend or otherwise change
the terms of any Senior Note Document, if the effect of such amendment or change is to:




     (a) increase the interest rate on Senior Notes;




     (b) change (to earlier dates) any dates upon which payments of principal or interest are due
thereon;




     (c) change any event of default or condition to an event of default with respect thereto
(other than to eliminate any such event of default or increase any grace period related thereto);




     (d) change the redemption, prepayment or defeasance provisions thereof;




     (e) change or permit any of its Subsidiaries to change any collateral therefor (other than
to release such collateral);




     (f) add any Negative Pledge thereto or modify any Negative Pledge therein that would in
either case restrict the ability of any Loan Party to grant liens to secure the Obligations of
such Loan Party; or




     (g) when together with all other amendments or changes made, materially increases the
obligations of the obligor thereunder or confers any additional rights on the holders of such
Senior Notes (or a trustee or other representative on their behalf) which would be adverse to
Holdings or the Lenders.


Notwithstanding any other provision of this Section 8.05, the addition of any new guarantor of the
Senior Notes in accordance with the terms of the Existing Indenture or the New Indenture, as
applicable, shall be permitted hereunder.




ARTICLE IX

EVENTS OF DEFAULT AND REMEDIES




     9.01 Events of Default. Any of the following shall constitute an Event of Default:




     (a) Non-Payment. The Borrower or any other Loan Party fails to pay (i) when and as
required to be paid herein, any amount of principal of any Loan or any L/C Obligation, or (ii)
within three days after the same becomes due, any interest on any Loan or on any L/C Obligation,
or any Commitment fee due hereunder, or (iii) within five days after the same becomes due, any
other fee or amount payable hereunder or under any other Loan Document; or



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     (b) Specific Covenants. The Borrower fails to perform or observe any term, covenant
or agreement contained in any of Section 6.01, 6.02, Article VII or
Article VIII; or




     (c) Other Defaults.




     (i) The occurrence of an Event of Default (as such term is or may hereafter be
specifically defined in any other Loan Document) under any Loan Document other than this
Agreement; or




     (ii) any Loan Party fails to perform or observe any other covenant or agreement (not
specified in subsection (a) or (b) above or in clause (i) of this subsection (c)) contained
in any Loan Document on its part to be performed or observed and such failure continues for
30 days after the earlier of (i) the date upon which a Responsible Officer has knowledge of
such failure and (ii) the date the Administrative Agent provides notice of such failure to
the Borrower; or




     (d) Representations and Warranties. Any representation, warranty, certification or
statement of fact made or deemed made by or on behalf of the Borrower or any other Loan Party
herein, in any other Loan Document, or in any document delivered in connection herewith or
therewith shall be incorrect or misleading when made or deemed made; or




     (e) Cross-Default. (i) Holdings or any other Loan Party (A) fails to make any
payment when due (whether by scheduled maturity, required prepayment, acceleration, demand, or
otherwise) in respect of any Indebtedness or Guarantee (other than Indebtedness hereunder and
Indebtedness under Swap Contracts) having an aggregate principal amount (including undrawn
committed or available amounts and including amounts owing to all creditors under any combined or
syndicated credit arrangement) of more than $7,500,000, or (B) fails to observe or perform any
other agreement or condition relating to any such Indebtedness or Guarantee or contained in any
instrument or agreement evidencing, securing or relating thereto, or any other event occurs, the
effect of which default or other event is to cause, or to permit the holder or holders of such
Indebtedness or the beneficiary or
beneficiaries of such Guarantee (or a trustee or agent on behalf of such holder or holders
or beneficiary or beneficiaries) to cause, with the giving of notice if required, such
Indebtedness to be demanded or to become due or to be repurchased, prepaid, defeased or redeemed
(automatically or otherwise), or an offer to repurchase, prepay, defease or redeem such
Indebtedness to be made, prior to its stated maturity, or such Guarantee to become payable or
cash collateral in respect thereof to be demanded; or (ii) there occurs under any Swap Contract
an Early Termination Date (as defined in such Swap Contract) resulting from (A) any event of
default under such Swap Contract as to which the Borrower or any Subsidiary is the Defaulting
Party (as defined in such Swap Contract) or (B) any Termination Event (as so defined) under such
Swap Contract as to which the Borrower or any Subsidiary is an Affected Party (as so defined)
and, in either event, the Swap Termination Value owed by the Borrower or such Subsidiary as a
result thereof is greater than $7,500,000; or




     (f) Insolvency Proceedings, Etc. Any Loan Party or any of its Subsidiaries
institutes or consents to the institution of any proceeding under any Debtor Relief Law, or makes
an assignment for the benefit of creditors; or applies for or consents to the appointment



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of any
receiver, trustee, custodian, conservator, liquidator, rehabilitator or similar officer for it or
for all or any material part of its property; or any receiver, trustee, custodian, conservator,
liquidator, rehabilitator or similar officer is appointed without the application or consent of
such Person and the appointment continues undischarged or unstayed for 60 calendar days; or any
proceeding under any Debtor Relief Law relating to any such Person or to all or any material part
of its property is instituted without the consent of such Person and continues undismissed or
unstayed for 60 calendar days, or an order for relief is entered in any such proceeding; or




     (g) Inability to Pay Debts; Attachment. (i) Any Loan Party becomes unable or admits
in writing its inability or fails generally to pay its debts as they become due, or (ii) any writ
or warrant of attachment or execution or similar process is issued or levied against all or any
material part of the property of any such Person and is not released, vacated or fully bonded
within 30 days after its issue or levy; or




     (h) Judgments. There is entered against any Loan Party (i) one or more final
judgments or orders for the payment of money in an aggregate amount (as to all such judgments or
orders) exceeding $7,500,000, or (ii) any one or more non-monetary final judgments that, in the
aggregate, have a Material Adverse Effect and, in either case, (A) enforcement proceedings are
commenced by any creditor upon such judgment or order, or (B) there is a period of 10 consecutive
days during which a stay of enforcement of such judgment, by reason of a pending appeal or
otherwise, is not in effect; or




     (i) ERISA. (i) An ERISA Event occurs with respect to a Pension Plan or
Multiemployer Plan which has resulted or could reasonably be expected to result in liability of
the Borrower under Title IV of ERISA to the Pension Plan, Multiemployer Plan or the PBGC in an
aggregate amount in excess of $1,000,000; (ii) the aggregate amount of Unfunded Pension Liability
among all Pension Plans at any time exceeds $35,000,000; or (iii) the Borrower or any ERISA
Affiliate fails to pay when due, after the expiration of any applicable grace period, any
installment payment with respect to its withdrawal liability under Section
4201 of ERISA under a Multiemployer Plan in an aggregate amount in excess of $1,000,000; or




     (j) Invalidity of Loan Documents. Any Loan Document, at any time after its
execution and delivery and for any reason other than as expressly permitted hereunder or
thereunder or satisfaction in full of all the Obligations, ceases to be in full force and effect
or is declared by a court of competent jurisdiction to be null and void, invalid or unenforceable
in any respect; or any Loan Party or any other Person contests in any manner the validity or
enforceability of any Loan Document; or any Loan Party denies that it has any or further
liability or obligation under any Loan Document, or purports to revoke, terminate or rescind any
Loan Document; or




     (k) Material Adverse Effect. Any event occurs which has a Material Adverse Effect.




     (l) Change of Control. Any Change of Control occurs.



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     (m) Failure to Refinance or Pay in Full Existing Fixed Rate Senior Notes. The Loan
Parties fail to refinance in full (on terms and conditions satisfactory to the Administrative
Agent and the Required Lenders) or otherwise pay in full the Existing Fixed Rate Senior Notes on
or prior to December 15, 2011.



     9.02 Remedies Upon Event of Default. If any Event of Default occurs and is continuing, the
Administrative Agent shall, at the request of, or may, with the consent of, the Required Lenders,
take any or all of the following actions:




     (a) declare the commitment of each Lender to make Loans and any obligation of the L/C Issuer
to make L/C Credit Extensions to be terminated, whereupon such commitments and obligation shall
be terminated;




     (b) declare the unpaid principal amount of all outstanding Loans, all interest accrued and
unpaid thereon, and all other amounts owing or payable hereunder or under any other Loan Document
to be immediately due and payable, without presentment, demand, protest or other notice of any
kind, all of which are hereby expressly waived by the Borrower;




     (c) require that the Borrower Cash Collateralize the L/C Obligations (in an amount equal to
the then Outstanding Amount thereof); and




     (d) exercise on behalf of itself, the Lenders and the L/C Issuer all rights and remedies
available to it, the Lenders and the L/C Issuer under the Loan Documents;


provided, however, that upon the occurrence of an actual or deemed entry of an
order for relief with respect to the Borrower under the Bankruptcy Code of the United States, the
obligation of each Lender to make Loans and any obligation of the L/C Issuer to make L/C Credit
Extensions shall automatically terminate, the unpaid principal amount of all outstanding Loans and
all interest and other amounts as aforesaid shall automatically become due and payable, and the
obligation of the Borrower to Cash Collateralize the L/C Obligations as aforesaid shall
automatically become effective, in each case without further act of the Administrative Agent or any
Lender.




     9.03 Application of Funds. After the exercise of remedies provided for in Section 9.02 (or
after the Loans have automatically become immediately due and payable and the L/C Obligations have
automatically been required to be Cash Collateralized as set forth in the proviso to Section
9.02), any amounts received on account of the Obligations shall be applied by the
Administrative Agent in the following order:



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



     Second, to payment of that portion of the Obligations constituting fees, indemnities
and other amounts (other than principal, interest and Letter of Credit Fees) payable to the Lenders
and the L/C Issuer (including fees, charges and disbursements of counsel to the respective



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Lenders
and the L/C Issuer and amounts payable under Article III), ratably among them 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
Letter of Credit Fees and interest on the Loans, L/C Borrowings and other Obligations, ratably
among the Lenders and the L/C Issuer 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, L/C Borrowings and Obligations then owing under Lender Hedge Agreements and Lender Cash
Management Agreements, ratably among the Lenders, the L/C Issuer, the Hedge Banks and the Cash
Management Banks in proportion to the respective amounts described in this clause Fourth
held by them;



     Fifth, to the Administrative Agent for the account of the L/C Issuer, to Cash
Collateralize that portion of L/C Obligations comprised of the aggregate undrawn amount of Letters
of Credit; 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.


Subject to Section 2.03(c), amounts used to Cash Collateralize the aggregate undrawn amount
of Letters of Credit pursuant to clause Fifth above shall be applied to satisfy drawings
under such Letters of Credit as they occur. If any amount remains on deposit as Cash Collateral
after all Letters of Credit have either been fully drawn or expired, such remaining amount shall be
applied to the other Obligations, if any, in the order set forth above.



Notwithstanding the foregoing, Obligations arising under Lender Cash Management Agreements and
Lender Hedge Agreements shall be excluded from the application described above if the
Administrative Agent has not received written notice thereof, together with such supporting
documentation as the Administrative Agent may request, from the applicable Cash Management Bank or
Hedge Bank, as the case may be. Each Cash Management Bank or Hedge Bank not a party to the Credit
Agreement that has given the notice contemplated by the preceding sentence shall, by such notice,
be deemed to have acknowledged and accepted the appointment of the Administrative Agent pursuant to
the terms of Article X hereof for itself and its Affiliates as if a “Lender” party hereto.




ARTICLE X

ADMINISTRATIVE AGENT




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



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



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




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




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




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



     The Administrative Agent shall not be liable for any action taken or not taken by it (i) with
the consent or at the request of the Required Lenders (or such other number or percentage of the
Lenders as shall be necessary, or as the Administrative Agent shall believe in good faith shall be
necessary, under the circumstances as provided in Sections 11.01 and 9.02) or (ii)
in the absence of its own gross negligence or willful misconduct. The Administrative Agent shall
be deemed not to have knowledge of any Default unless and until notice describing such Default is
given to the Administrative Agent by the Borrower, a Lender or the L/C Issuer.



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



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or elsewhere herein, other than to
confirm receipt of items expressly required to be delivered to the Administrative Agent.



     10.04 Reliance by Administrative Agent. The Administrative Agent shall be entitled to rely upon,
and shall not incur any liability for relying upon, any notice, request, certificate, consent,
statement, instrument, document or other writing (including any electronic message, Internet or
intranet website posting or other distribution) believed by it to be genuine and to have been
signed, sent or otherwise authenticated by the proper Person. The Administrative Agent also may
rely upon any statement made to it orally or by telephone and believed by it to have been made by
the proper Person, and shall not incur any liability for relying thereon. In determining
compliance with any condition hereunder to the making of a Loan, or the issuance of a Letter of
Credit, that by its terms must be fulfilled to the satisfaction of a Lender or the L/C Issuer, the
Administrative Agent may presume that such condition is satisfactory to such Lender or the L/C
Issuer unless the Administrative Agent shall have received notice to the contrary from such Lender
or the L/C Issuer prior to the making of such Loan or the issuance of such Letter of Credit. The
Administrative Agent may consult with legal counsel (who may be counsel for the Borrower),
independent accountants and other experts selected by it, and shall not be liable for any action
taken or not taken by it in accordance with the advice of any such counsel, accountants or experts.



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



     10.06 Resignation of Administrative Agent. The Administrative Agent may at any time give notice of
its resignation to the Lenders, the L/C Issuer and the Borrower. Upon receipt of any such notice
of resignation, the Required Lenders shall have the right, in consultation with the Borrower, to
appoint a successor, which shall be a bank with an office in the United States, or an Affiliate of
any such bank with an office in the United States. If no such successor shall have been so
appointed by the Required Lenders and shall have accepted such appointment within 30 days after the
retiring Administrative Agent gives notice of its resignation, then the retiring Administrative
Agent may on behalf of the Lenders and the L/C Issuer, appoint a successor Administrative Agent
meeting the qualifications set forth above; provided that if the Administrative Agent shall
notify the Borrower and the Lenders that no qualifying Person has accepted such appointment, then
such resignation shall nonetheless become effective in accordance with such notice and (1) the
retiring Administrative Agent shall be discharged from its duties and obligations hereunder and
under the other Loan Documents (except that in the case of any collateral security held by the
Administrative Agent on behalf of the Lenders or the L/C Issuer under any of the Loan Documents,
the retiring Administrative Agent shall continue to hold such collateral security until such time
as a successor Administrative Agent is appointed) and (2) all payments, communications and
determinations provided to be made by, to or through the Administrative Agent shall instead be made
by or to each Lender and the L/C Issuer directly,



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until such time as the Required Lenders appoint a
successor Administrative Agent as provided for above in this Section. Upon the acceptance of a
successor’s appointment as Administrative Agent hereunder, such successor shall succeed to and
become vested with all of the rights, powers, privileges and duties of the retiring (or retired)
Administrative Agent, and the retiring Administrative Agent shall be discharged from all of its
duties and obligations hereunder or under the other Loan Documents (if not already discharged
therefrom as provided above in this Section). The fees payable by the Borrower to a successor
Administrative Agent shall be no greater than those payable to its predecessor unless otherwise
agreed between the Borrower and such successor. After the retiring Administrative Agent’s
resignation hereunder and under the other Loan Documents, the provisions of this Article and
Section 11.04 shall continue in effect for the benefit of such retiring Administrative
Agent, its sub-agents and their respective Related Parties in respect of any actions taken or
omitted to be taken by any of them while the retiring Administrative Agent was acting as
Administrative Agent.



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



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



     10.08 No Other Duties, Etc. Anything herein to the contrary notwithstanding, none of the Book
Manager or Arranger listed on the cover page hereof shall have any powers, duties or
responsibilities under this Agreement or any of the other Loan Documents, except in its capacity,
as applicable, as the Administrative Agent, a Lender or the L/C Issuer hereunder.



     10.09 Administrative Agent May File Proofs of Claim. In case of the pendency of any proceeding
under any Debtor Relief Law or any other judicial proceeding relative to any Loan 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, by intervention in such proceeding or otherwise:




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     (a) to 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, the L/C Issuer and the Administrative Agent (including any claim for the
reasonable compensation, expenses, disbursements and advances of the Lenders, the L/C Issuer and
the Administrative Agent and their respective agents and counsel and all other amounts due the
Lenders, the L/C Issuer and the Administrative Agent under Sections 2.03(i) and
(j), 2.08 and 11.04) allowed in such judicial proceeding; and




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


and any custodian, receiver, assignee, trustee, liquidator, sequestrator or other similar official
in any such judicial proceeding is hereby authorized by each Lender and the L/C Issuer 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 and the L/C Issuer, to pay to the
Administrative Agent any amount due for the reasonable compensation, expenses, disbursements and
advances of the Administrative Agent and its agents and counsel, and any other amounts due the
Administrative Agent under Sections 2.08 and 11.04.




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



     10.10 Guaranty Matters. The Lenders (including in its capacities as a potential Cash Management
Bank and a potential Hedge Bank) and the L/C Issuer irrevocably authorize the Administrative Agent,
at its option and in its discretion, to release any Guarantor from its obligations under the
Guaranty if such Person ceases to be a Subsidiary as a result of a transaction permitted hereunder.
Upon request by the Administrative Agent at any time, the Required Lenders will confirm in writing
the
Administrative Agent’s authority to release any Guarantor from its obligations under the Guaranty
pursuant to this Section 10.10.



     10.11 Lender Cash Management Agreements and Lender Hedge Agreements. No Cash Management Bank or
Hedge Bank that obtains the benefits of Section 9.03 or any Guaranty by virtue of the provisions
hereof or of any Guaranty shall have any right to notice of any action or to consent to, direct or
object to any action hereunder or under any other Loan Document other than in its capacity as a
Lender and, in such case, only to the extent expressly provided in the Loan Documents.
Notwithstanding any other provision of this Article X to the contrary, the Administrative Agent
shall not be required to verify the payment of, or that other satisfactory arrangements have been
made with respect to, Obligations arising under Lender Cash Management Agreements and Lender Hedge
Agreements unless the Administrative Agent has received written notice of such Obligations,
together with such supporting documentation as the Administrative Agent may request, from the
applicable Cash Management Bank or Hedge Bank, as the case may be.



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ARTICLE XI

MISCELLANEOUS




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




     (a) waive any condition set forth in Section 4.01(a) without the written consent of
each Lender;




     (b) extend or increase the Commitment of any Lender (or reinstate any Commitment terminated
pursuant to Section 9.02) without the written consent of such Lender;




     (c) postpone any date fixed by this Agreement or any other Loan Document for any payment or
mandatory prepayment 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;




     (d) reduce the principal of, or the rate of interest specified herein on, any Loan or L/C
Borrowing, or (subject to clause (iii) of the second proviso to this Section 11.01) any
fees or other amounts payable hereunder or under any other Loan Document without the written
consent of each Lender directly affected thereby; provided, however, that only
the consent of the Required Lenders shall be necessary to amend the definition of “Default Rate”
or to waive any obligation of the Borrower to pay interest or Letter of Credit Fees at the
Default Rate;




     (e) change Section 2.12 or Section 9.03 in a manner that would alter the pro
rata sharing of payments required thereby without the written consent of each Lender;




     (f) 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; or




     (g) release any Guarantor from the Guaranty without the written consent of each Lender,
except to the extent the release of such Guarantor is permitted pursuant to Section 10.10
(in which case such release may be made by the Administrative Agent acting alone);


and, provided further, that (i) no amendment, waiver or consent shall, unless in
writing and signed by the L/C Issuer in addition to the Lenders required above, affect the rights
or duties of the L/C Issuer under this Agreement or any Issuer Document 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 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 (iii)
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




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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.




     11.02 Notices; Effectiveness; Electronic Communication.




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




     (i) if to the Borrower, Holdings, the Administrative Agent or the L/C Issuer, to the
address, telecopier number, electronic mail address or telephone number specified for such
Person on Schedule 11.02; and




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


Notices and other communications sent by hand or overnight courier service, or mailed by certified
or registered mail, shall be deemed to have been given when received; notices and other
communications 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 and other communications
delivered through electronic communications to the extent provided in subsection (b) below, shall
be effective as provided in such subsection (b).





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


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



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





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




     (d) Change of Address, Etc. Each of the Borrower, Holdings, the Administrative
Agent and the L/C Issuer may change its address, telecopier or telephone number for notices and
other communications hereunder by notice to the other parties hereto. Each other Lender may
change its address, telecopier or telephone number for notices and other communications
hereunder by notice to the Borrower, Holdings, the Administrative Agent and the L/C Issuer.
In addition, each Lender agrees to notify the Administrative Agent from time to time to ensure
that the Administrative Agent has on record (i) an effective address, contact name, telephone
number, telecopier number and electronic mail address to which notices and other communications
may be sent and (ii) accurate wire instructions for such Lender. Furthermore, each Public Lender
agrees to cause at least one individual at or on behalf of such Public Lender to at all times
have selected the “Private Side Information” or similar designation on the content declaration
screen of the Platform in order to enable such Public Lender or its delegate, in accordance with
such Public Lender’s compliance procedures and applicable Law, including United States Federal
and state securities Laws, to make reference to Borrower Materials that are not made available
through the “Public Side Information” portion of the Platform and that may contain material
non-public information with respect to the Borrower, Holdings or their securities for purposes of
United States Federal or state securities laws.




     (e) Reliance by Administrative Agent, L/C Issuer and Lenders. The Administrative
Agent, the L/C Issuer and the Lenders shall be entitled to rely and act upon any notices
(including telephonic Loan Notices) purportedly given by or on behalf of the



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



     11.03 No Waiver; Cumulative Remedies; Enforcement. No failure by any Lender, the L/C Issuer or the
Administrative Agent to exercise, and no delay by any such Person in exercising, any right, remedy,
power or privilege hereunder shall operate as a waiver thereof; nor shall any single or partial
exercise of any right, remedy, power or privilege hereunder preclude any other or further exercise
thereof or the exercise of any other right, remedy, power or privilege. The rights, remedies,
powers and privileges herein provided are cumulative and not exclusive of any rights, remedies,
powers and privileges provided by law.



     Notwithstanding anything to the contrary contained herein or in any other Loan Document, the
authority to enforce rights and remedies hereunder and under the other Loan Documents against the
Loan Parties or any of them shall be vested exclusively in, and all actions and proceedings at law
in connection with such enforcement shall be instituted and maintained exclusively by, the
Administrative Agent in accordance with Section 9.02 for the benefit of all the Lenders and
the L/C Issuer; provided, however, that the foregoing shall not prohibit (a) the
Administrative Agent from exercising on its own behalf the rights and remedies that inure to its
benefit (solely in its capacity as Administrative Agent) hereunder and under the other Loan
Documents, (b) the L/C Issuer from exercising the rights and remedies that inure to its benefit
(solely in its capacity as L/C Issuer) hereunder and under the other Loan Documents, (c) any
Lender from exercising setoff rights in accordance with Section 11.08 (subject to the
terms of Section 2.12), or (d) any Lender from filing proofs of claim or appearing and
filing pleadings on its own behalf during the pendency of a proceeding relative to any Loan Party
under any Debtor Relief Law; and provided, further, that if at any time there is no
Person acting as Administrative Agent hereunder and under the other Loan Documents, then (i) the
Required Lenders shall have the rights otherwise ascribed to the Administrative Agent pursuant to
Section 9.02 and (ii) in addition to the matters set forth in clauses (b), (c) and (d) of
the preceding proviso and subject to Section 2.12, any Lender may, with the consent of the
Required Lenders, enforce any rights and remedies available to it and as authorized by the Required
Lenders.



     11.04 Expenses; Indemnity; Damage Waiver.




     (a) Costs and Expenses. The Borrower shall pay (i) all reasonable out-of-pocket
expenses incurred by the Administrative Agent and its Affiliates (including the reasonable fees,
charges and disbursements of counsel for the Administrative Agent), in connection with the
syndication of the credit facilities provided for herein, the preparation, negotiation,
execution, delivery and administration of this Agreement and the other Loan Documents or any
amendments, modifications or waivers of the provisions hereof or thereof (whether or not the
transactions contemplated hereby or thereby shall be consummated), (ii) all reasonable



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out-of-pocket expenses incurred by the L/C Issuer in connection with the issuance, amendment,
renewal or extension of any Letter of Credit or any demand for payment thereunder and (iii) all
out-of-pocket expenses incurred by the Administrative Agent, any Lender or the L/C Issuer
(including the fees, charges and disbursements of any counsel for the Administrative Agent, any
Lender or the L/C Issuer), 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 the L/C Issuer, and each
Related Party of any of the foregoing Persons (each such Person being called an
“Indemnitee”) against, and hold each Indemnitee harmless from, any and all losses,
claims, damages, liabilities and related expenses (including the fees, charges and disbursements
of any counsel for any Indemnitee), incurred by any Indemnitee or asserted against any Indemnitee
by any third party or by the Borrower or any other Loan Party arising out of, in connection with,
or as a result of (i) the execution or delivery of this Agreement, any other Loan Document or any
agreement or instrument contemplated hereby or thereby, the performance by the parties hereto of
their respective obligations hereunder or thereunder, the consummation of the transactions
contemplated hereby or thereby, or, in the case of the Administrative Agent (and any sub-agent
thereof) and its Related Parties only, the administration of this Agreement and the other Loan
Documents (including in respect of any matters addressed in Section 3.01), (ii) any Loan
or Letter of Credit or the use or proposed use of the proceeds therefrom (including any refusal
by the L/C Issuer 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 any
Loan Party or any of its Subsidiaries, or any Environmental Liability related in any way to
any Loan Party or any of its Subsidiaries, or (iv) any actual or prospective claim, litigation,
investigation or proceeding relating to any of the foregoing, whether based on contract, tort or
any other theory, whether brought by a third party or by the Borrower or any other Loan Party,
and regardless of whether any Indemnitee is a party thereto; provided that such indemnity
shall not, as to any Indemnitee, be available to the extent that such losses, claims, damages,
liabilities or related expenses (x) are determined by a court of competent jurisdiction by final
and nonappealable judgment to have resulted from the gross negligence or willful misconduct of
such Indemnitee or (y) result from a claim brought by the Borrower or any other Loan Party
against an Indemnitee for breach in bad faith of such Indemnitee’s obligations hereunder or under
any other Loan Document, if the Borrower or such other Loan 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 subsection (a) or (b) of this Section to be paid by
it to the Administrative Agent (or any sub-agent thereof), the L/C Issuer or any Related Party of
any of the foregoing, each Lender severally agrees to pay to the Administrative Agent (or any
such sub-agent), the L/C Issuer or such Related Party, as the



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case may be, such Lender’s
Applicable Percentage (determined as of the time that the applicable unreimbursed expense or
indemnity payment is sought) of such unpaid amount, provided that the unreimbursed
expense or indemnified loss, claim, damage, liability or related expense, as the case may be, was
incurred by or asserted against the Administrative Agent (or any such sub-agent) or the L/C
Issuer 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 L/C Issuer in connection with such capacity.
The obligations of the Lenders under this subsection (c) are subject to the provisions of
Section 2.11(d).




     (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 subsection (b) above shall be liable for any
damages arising from the use by unintended recipients of any information or other materials
distributed to such unintended recipients by such Indemnitee 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 other than for direct or
actual damages resulting from the gross negligence or willful misconduct of such Indemnitee as
determined by a final and nonappealable judgment of a court of competent jurisdiction.




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




     (f) Survival. The agreements in this Section shall survive the resignation of the
Administrative Agent and the L/C Issuer, the replacement of any Lender, the termination of the
Aggregate Commitments and the repayment, satisfaction or discharge of all the other Obligations.



     11.05 Payments Set Aside. To the extent that any payment by or on behalf of the Borrower is made
to the Administrative Agent, the L/C Issuer or any Lender, or the Administrative Agent, the L/C
Issuer or any Lender exercises its right of setoff, and such payment or the proceeds of such setoff
or any part thereof is subsequently invalidated, declared to be fraudulent or preferential, set
aside or required (including pursuant to any settlement entered into by the Administrative Agent,
the L/C Issuer or such Lender in its discretion) to be repaid to a trustee, receiver or any other
party, in connection with any proceeding under any Debtor Relief Law or otherwise, then (a) to the
extent of such recovery, the obligation or part thereof originally intended to be satisfied shall
be revived and continued in full force and effect as if such payment had not been made or such
setoff had not occurred, and (b) each Lender and the L/C Issuer severally agrees to pay to the
Administrative Agent upon demand its applicable share (without duplication) of any amount so
recovered from or repaid by the Administrative Agent, plus interest thereon from the date of such
demand to the date such payment is made at a rate per annum equal to the Federal Funds Rate from
time to time in effect. The obligations of



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the Lenders and the L/C Issuer under clause (b) of the
preceding sentence shall survive the payment in full of the Obligations and the termination of this
Agreement.



     11.06 Successors and Assigns.




     (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 Holdings 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
subsection (b) of this Section, (ii) by way of participation in accordance with the provisions of
subsection (d) of this Section, or (iii) by way of pledge or assignment of a security interest
subject to the restrictions of subsection (f) of this Section (and any other attempted assignment
or transfer by any party hereto shall be null and void). Nothing in this Agreement, expressed or
implied, shall be construed to confer upon any Person (other than the parties hereto, their
respective successors and assigns permitted hereby, Participants to the extent provided in
subsection (d) of this Section and, to the extent expressly contemplated hereby, the Related
Parties of each of the Administrative Agent, the L/C Issuer 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 (including for purposes of this subsection (b),
participations in L/C Obligations) 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 subsection (b)(i)(A) of this Section, the
aggregate amount of the Commitment (which for this purpose includes Loans
outstanding thereunder) or, if the 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 $1,000,000 unless each of the Administrative Agent and, so long as no Event of
Default has occurred and is continuing, the Borrower otherwise consents (each such
consent not to be unreasonably withheld or delayed); provided,
however, that concurrent assignments to members of an Assignee Group and
concurrent assignments from members of an Assignee Group to a single Eligible
Assignee (or to an Eligible Assignee and members of its Assignee



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Group) will be
treated as a single assignment for purposes of determining whether such minimum
amount has been met;




     (ii) Proportionate Amounts. Each partial assignment shall be made as an
assignment of a proportionate part of all the assigning Lender’s rights and obligations
under this Agreement with respect to the Loans or the Commitment assigned;




     (iii) Required Consents. No consent shall be required for any assignment
except to the extent required by subsection (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 (1) an Event of Default has occurred and is
continuing at the time of such assignment or (2) 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 if such assignment is to a
Person that is not a Lender, an Affiliate of such Lender or an Approved Fund with
respect to such Lender;




     (C) the consent of the L/C Issuer (such consent 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).




In the event the Borrower’s consent is required to an assignment pursuant to clause
(A) above, the Borrower may withhold its consent if such assignment is not to (i) a
financial institution organized under the laws of the United States, or any
state thereof, and having a combined capital and surplus of at least $100,000,000;
or (ii) a commercial bank organized under the laws of any other country which is a
member of the Organization for Economic Cooperation and Development, or a political
subdivision of any such country, and having a combined capital and surplus of at
least $100,000,000, provided that such bank is acting through a branch or agency
located in the United States.




     (iv) Assignment and Assumption. The assignors and assignees to each assignment
shall execute and deliver to the Administrative Agent an Assignment and Assumption, together
with a processing and recordation fee in the amount of $3,500; provided,
however, that the Administrative Agent may, in its sole discretion, elect to waive
such processing and recordation fee in the case of any assignment. The assignee, if it is
not a Lender, shall deliver to the Administrative Agent an Administrative Questionnaire;




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




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



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Subject to acceptance and recording thereof by the Administrative Agent pursuant to subsection (c)
of this Section, from and after the effective date specified in each Assignment and Assumption, the
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 3.01, 3.04, 3.05, and 11.04
with respect to facts and circumstances occurring prior to the effective date of such assignment.
Upon request, the Borrower (at its expense) shall execute and deliver a Note to the assignee
Lender. Any assignment or transfer by a Lender of rights or obligations under this Agreement that
does not comply with this subsection shall be treated for purposes of this Agreement as a sale by
such Lender of a participation in such rights and obligations in accordance with subsection (d) of
this Section.





     (c) Register. The Administrative Agent, acting solely for this purpose as an agent
of the Borrower, shall maintain at the Administrative Agent’s Office a copy of each Assignment
and Assumption delivered to it and a register for the recordation of the names and addresses of
the Lenders, and the Commitments of, and principal amounts of the Loans and L/C Obligations owing
to, each Lender pursuant to the terms hereof from time to time (the “Register”). The
entries in the Register shall be conclusive, and the Borrower, the Administrative Agent and the
Lenders may treat each Person whose name is recorded in the Register pursuant to the terms hereof
as a Lender hereunder for all purposes of this Agreement, notwithstanding notice to the contrary.
The Register shall be available for
inspection by the Borrower and any 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, Holdings or the Administrative Agent, sell participations to any Person (other
than a natural person or the Borrower, Holdings or any of the Borrower’s or Holdings’ 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 (including such Lender’s participations in L/C Obligations) 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, Holdings, the Administrative Agent, the Lenders and the L/C
Issuer shall continue to deal solely and directly with such Lender in connection with such
Lender’s rights and obligations under this Agreement.



     Any agreement or instrument pursuant to which a Lender sells such a participation shall
provide that such Lender shall retain the sole right to enforce this Agreement and to approve any
amendment, modification or waiver of any provision of this Agreement; provided that such
agreement or instrument may provide that such Lender will not, without the consent of the
Participant, agree to any amendment, waiver or other modification described in the first proviso to
Section 11.01 that affects such Participant. Subject to subsection (e) of this Section,
the Borrower agrees that each Participant shall be entitled to the benefits of Sections
3.01, 3.04 and



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3.05 to the same extent as if it were a Lender and had acquired
its interest by assignment pursuant to subsection (b) of this Section. To the extent permitted by
law, each Participant also shall be entitled to the benefits of Section 11.08 as though it
were a Lender, provided such Participant agrees to be subject to Section 2.12 as
though it were a Lender.




     (e) Limitations upon Participant Rights. A Participant shall not be entitled to
receive any greater payment under Section 3.01 or 3.04 than the applicable Lender
would have been entitled to receive with respect to the participation sold to such Participant,
unless the sale of the participation to such Participant is made with the Borrower’s prior
written consent. A Participant that would be a Foreign Lender if it were a Lender shall not be
entitled to the benefits of Section 3.01 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 3.01(e) as though it were a Lender.




     (f) Certain Pledges. Any Lender may at any time pledge or assign a security
interest in all or any portion of its rights under this Agreement (including under its Note, if
any) to secure obligations of such Lender, including any pledge or assignment to secure
obligations to a Federal Reserve Bank; provided that no such pledge or assignment shall
release such Lender from any of its obligations hereunder or substitute any such pledgee or
assignee for such Lender as a party hereto.




     (g) Resignation as L/C Issuer after Assignment. Notwithstanding anything to the
contrary contained herein, if at any time Bank of America assigns all of its Commitment and Loans
pursuant to subsection (b) above, Bank of America may, upon 30 days’ notice to the Borrower and
the Lenders, resign as L/C Issuer. In the event of any such resignation as L/C
Issuer, the Borrower shall be entitled to appoint from among the Lenders a successor L/C
Issuer hereunder; provided, however, that no failure by the Borrower to appoint
any such successor shall affect the resignation of Bank of America as L/C Issuer. If Bank of
America resigns as L/C Issuer, it shall retain all the rights, powers, privileges and duties of
the L/C Issuer hereunder with respect to all Letters of Credit outstanding as of the effective
date of its resignation as L/C Issuer and all L/C Obligations with respect thereto (including the
right to require the Lenders to make Loans or fund risk participations in Unreimbursed Amounts
pursuant to Section 2.03(c)). Upon the appointment of a successor L/C Issuer, (a) such
successor shall succeed to and become vested with all of the rights, powers, privileges and
duties of the retiring L/C Issuer, and (b) the successor L/C Issuer shall issue letters of credit
in substitution for the Letters of Credit, if any, outstanding at the time of such succession or
make other arrangements satisfactory to Bank of America to effectively assume the obligations of
Bank of America with respect to such Letters of Credit.



     11.07 Treatment of Certain Information; Confidentiality. Each of the Administrative Agent, the
Lenders and the L/C Issuer 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, trustees, advisors and
representatives (it being understood that the Persons to whom such disclosure is made will be
informed of the confidential nature of such Information and instructed to keep such Information
confidential), (b) to the extent requested by any regulatory authority purporting to have
jurisdiction over it (including any self-regulatory authority, such as the National



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Association of
Insurance Commissioners), (c) to the extent required by applicable laws or regulations or by any
subpoena or similar legal process, provided that, to the extent practical and legally permissible,
such Person disclosing such Information shall give advance notice of such disclosure to the
Borrower, (d) to any other party hereto, (e) in connection with the exercise of any remedies
hereunder or under any other Loan Document or any action or proceeding relating to this Agreement
or any other Loan Document or the enforcement of rights hereunder or thereunder, (f) subject to an
agreement containing provisions substantially the same as those of this Section, to (i) any
assignee of or Participant in, or any prospective assignee of or Participant in, any of its rights
or obligations under this Agreement or (ii) any actual or prospective counterparty (or its
advisors) to any swap or derivative transaction relating to any Loan Party and its obligations, (g)
with the consent of the Borrower or (h) to the extent such Information (x) becomes publicly
available other than as a result of a breach of this Section or (y) becomes available to the
Administrative Agent, any Lender, the L/C Issuer 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
Loan Parties or any of their Subsidiaries relating to the Loan Parties or any of their Subsidiaries
or any of their respective businesses, other than any such information that is available to the
Administrative Agent, any Lender or the L/C Issuer on a nonconfidential basis prior to disclosure
by any Loan Party or any of its Subsidiaries, provided that, in the case of information
received from the Loan Parties or any of their 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.



     Each of the Administrative Agent, the Lenders and the L/C Issuer acknowledges that (a)
the Information may include material non-public information concerning the Loan Parties or any of their
Subsidiaries, as the case may be, (b) it has developed compliance procedures regarding the use of material non-public
information and (c) it will handle such material non-public information in accordance
with applicable Law, including United States Federal and state securities Laws.



     11.08 Right of Setoff. If an Event of Default shall have occurred and be continuing, each
Lender, the L/C Issuer and each of their respective Affiliates is hereby authorized at any time and
from time to time, after obtaining the prior written consent of the Administrative Agent, to the
fullest extent permitted by applicable law, to set off and apply any and all deposits (general or
special, time or demand, provisional or final, in whatever currency) at any time held and other
obligations (in whatever currency) at any time owing by such Lender, the L/C Issuer or any such
Affiliate to or for the credit or the account of the Borrower or any other Loan Party against any
and all of the obligations of the Borrower or such Loan Party now or hereafter existing under this
Agreement or any other Loan Document to such Lender or the L/C Issuer, irrespective of whether or
not such Lender or the L/C Issuer shall have made any demand under this Agreement or any other Loan
Document and although such obligations of the Borrower or such Loan Party may be contingent or
unmatured or are owed to a branch or office of such Lender or the L/C Issuer different from the
branch or office holding such deposit or obligated on such indebtedness.



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The rights of each
Lender, the L/C Issuer and their respective Affiliates under this Section are in addition to other
rights and remedies (including other rights of setoff) that such Lender, the L/C Issuer or their
respective Affiliates may have. Each Lender and the L/C Issuer agrees 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.




     11.09 Interest Rate Limitation. Notwithstanding anything to the contrary contained in any Loan
Document, the interest paid or agreed to be paid under the Loan Documents shall not exceed the
maximum rate of non-usurious interest permitted by applicable Law (the “Maximum Rate”). If
the Administrative Agent or any Lender shall receive interest in an amount that exceeds the Maximum
Rate, the excess interest shall be applied to the principal of the Loans or, if it exceeds such
unpaid principal, refunded to the Borrower. In determining whether the interest contracted for,
charged, or received by the Administrative Agent or a Lender exceeds the Maximum Rate, such Person
may, to the extent permitted by applicable Law, (a) characterize any payment that is not principal
as an expense, fee, or premium rather than interest, (b) exclude voluntary prepayments and the
effects thereof, and (c) amortize, prorate, allocate, and spread in equal or unequal parts the
total amount of interest throughout the contemplated term of the Obligations hereunder.



     11.10 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 constitute the entire contract among the parties relating to the
subject matter hereof and supersede any and all previous agreements and understandings, oral or
written, relating to the subject matter hereof. Except as provided in Section 4.01, 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 or other electronic imaging means shall be effective as delivery of a manually executed
counterpart of this Agreement.



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



     11.12 Severability. If any provision of this Agreement or the other Loan Documents is held to be
illegal, invalid or unenforceable, (a) the legality, validity and enforceability of the remaining
provisions of this Agreement and the other Loan Documents shall not be affected or



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impaired thereby
and (b) the parties shall endeavor in good faith negotiations to replace the illegal, invalid or
unenforceable provisions with valid provisions the economic effect of which comes as close as
possible to that of the illegal, invalid or unenforceable provisions. The invalidity of a
provision in a particular jurisdiction shall not invalidate or render unenforceable such provision
in any other jurisdiction.




     11.13 Replacement of Lenders. If any Lender requests compensation under Section 3.04, 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 3.01, or if any Lender is a
Defaulting Lender, then the Borrower may, at its sole expense and effort, upon notice to such
Lender and the Administrative Agent, require such Lender to assign and delegate, without recourse
(in accordance with and subject to the restrictions contained in, and consents required by,
Section 11.06), all of its interests, rights and obligations under this Agreement and the
related Loan Documents to an assignee that shall assume such obligations (which assignee may be
another Lender, if a Lender accepts such assignment), provided that:




     (a) the Borrower shall have paid to the Administrative Agent the assignment fee specified in
Section 11.06(b);




     (b) such Lender shall have received payment of an amount equal to the outstanding principal
of its Loans and L/C Advances, accrued interest thereon, accrued fees and all other amounts
payable to it hereunder and under the other Loan Documents (including any amounts under
Section 3.05) from the assignee (to the extent of such outstanding principal and accrued
interest and fees) or the Borrower (in the case of all other amounts);




     (c) in the case of any such assignment resulting from a claim for compensation under
Section 3.04 or payments required to be made pursuant to Section 3.01, such
assignment will result in a reduction in such compensation or payments thereafter; and




     (d) such assignment does not conflict with applicable Laws.



     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.



     11.14 Governing Law; Jurisdiction; Etc.




     (a) GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE
WITH, THE LAW OF THE STATE OF CALIFORNIA.




     (b) SUBMISSION TO JURISDICTION. THE BORROWER AND EACH OTHER LOAN PARTY IRREVOCABLY
AND UNCONDITIONALLY SUBMITS, FOR ITSELF AND ITS PROPERTY, TO THE NONEXCLUSIVE JURISDICTION OF THE
COURTS OF THE STATE OF CALIFORNIA AND OF THE UNITED STATES DISTRICT COURT OF THE CENTRAL
DISTRICT, 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



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OR ENFORCEMENT OF ANY
JUDGMENT, AND EACH OF THE PARTIES HERETO IRREVOCABLY AND UNCONDITIONALLY AGREES THAT ALL CLAIMS
IN RESPECT OF ANY SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN SUCH STATE COURT OR,
TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, IN SUCH FEDERAL COURT. EACH OF THE PARTIES
HERETO AGREES THAT A FINAL JUDGMENT IN ANY SUCH ACTION OR PROCEEDING SHALL BE CONCLUSIVE AND MAY
BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY
LAW. NOTHING IN THIS AGREEMENT OR IN ANY OTHER LOAN DOCUMENT SHALL AFFECT ANY RIGHT THAT THE
ADMINISTRATIVE AGENT, ANY LENDER OR THE L/C ISSUER MAY OTHERWISE HAVE TO BRING ANY ACTION OR
PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT AGAINST THE BORROWER OR ANY
OTHER LOAN PARTY OR THEIR RESPECTIVE PROPERTIES IN THE COURTS OF ANY JURISDICTION.




     (c) WAIVER OF VENUE. THE BORROWER AND EACH OTHER LOAN PARTY 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 11.02. NOTHING IN THIS AGREEMENT
WILL AFFECT THE RIGHT OF ANY PARTY HERETO TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY
APPLICABLE LAW.



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




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     11.16 No Advisory or Fiduciary Responsibility. In connection with all aspects of each transaction contemplated hereby (including in connection
with any amendment, waiver or other modification hereof or of any other Loan Document), the
Borrower and each other Loan Party acknowledges and agrees, and acknowledges its Affiliates’
understanding, that: (i) (A) the arranging and other services regarding this Agreement provided by
the Administrative Agent and the Arranger are arm’s-length commercial transactions between the
Borrower, each other Loan Party and their respective Affiliates, on the one hand, and the
Administrative Agent and the Arranger, on the other hand, (B) each of the Borrower and the other
Loan Parties has consulted its own legal, accounting, regulatory and tax advisors to the extent it
has deemed appropriate, and (C) the Borrower and each other Loan Party is capable of evaluating,
and understands and accepts, the terms, risks and conditions of the transactions contemplated
hereby and by the other Loan Documents; (ii) (A) the Administrative Agent and the Arranger each is
and has been acting solely as a principal and, except as expressly agreed in writing by the
relevant parties, has not been, is not, and will not be acting as an advisor, agent or fiduciary
for the Borrower, any other Loan Party or any of their respective Affiliates, or any other Person
and (B) neither the Administrative Agent nor the Arranger has any obligation to the Borrower, any
other Loan Party or any of their respective Affiliates with respect to the transactions
contemplated hereby except those obligations expressly set forth herein and in the other Loan
Documents; and (iii) the Administrative Agent and the Arranger and their respective Affiliates may
be engaged in a broad range of transactions that involve interests that differ from those of the
Borrower, the other Loan Parties and their respective Affiliates, and neither the Administrative
Agent nor the Arranger has any obligation to disclose any of such interests to the Borrower, any
other Loan Party or any of their respective Affiliates. To the fullest extent permitted by law,
each of the Borrower and the other Loan Parties hereby waives and releases any claims that it may
have against the Administrative Agent and the Arranger with respect to any breach or alleged breach
of agency or fiduciary duty in connection with any aspect of any transaction contemplated hereby.



     11.17 Electronic Execution of Assignments and Certain Other Documents. The words “execution,” “signed,” “signature,” and words of like import in any Assignment and
Assumption or in any amendment or other modification hereof (including waivers and consents) 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.



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



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order to comply with its ongoing obligations under
applicable “know your customer” and anti-money laundering rules and regulations, including the Act.



     11.19 Time of the Essence. Time is of the essence of the Loan Documents.



     11.20 California Judicial Reference. If any action or proceeding is filed in a court of the State of California by or against any
party hereto in connection with any of the transactions contemplated by this Agreement or any other
Loan Document, (a) the court shall, and is hereby directed to, make a general reference pursuant to
California Code of Civil Procedure Section 638 to a referee (who shall be a single active or
retired judge) to hear and determine all of the issues in such action or proceeding (whether of
fact or of law) and to report a statement of decision, provided that at the option of any
party to such proceeding, any such issues pertaining to a “provisional remedy” as defined in
California Code of Civil Procedure Section 1281.8 shall be heard and determined by the court, and
(b) without limiting the generality of Section 11.04, the Borrower shall be solely
responsible to pay all fees and expenses of any referee appointed in such action or proceeding.



     11.21 Amendment and Restatement. This Agreement amends and restates the Existing Credit
Agreement in its entirety, without constituting a novation thereof.



[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK;

SIGNATURE PAGES FOLLOW]




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



	 	 	 	 	 	 	 

	 	 	BORROWER:	 	 
	 
	 	 	 	 	 	 
	 	 	STATER BROS. MARKETS,

a California corporation	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/s/ Phillip J. Smith
 

Phillip J. Smith
	 	 
	 

	 	Title:
	 	Executive Vice President, Chief Financial	 	 
	 

	 	 	 	Office and Chief Accounting Officer	 	 
	 
	 	 	 	 	 	 
	 	 	HOLDINGS:	 	 
	 
	 	 	 	 	 	 
	 	 	STATER BROS. HOLDINGS INC.,

a Delaware corporation	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/s/ Bruce D. Varner
 

Bruce D. Varner
	 	 
	 

	 	Title:
	 	Secretary	 	 
	 
	 	 	 	 	 	 
	 	 	BANK OF AMERICA, N.A.,

as Administrative Agent	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/s/ Matthew Koenig
 

Matthew Koenig
	 	 
	 

	 	Title:
	 	Senior Vice President	 	 
	 
	 	 	 	 	 	 
	 	 	BANK OF AMERICA, N.A.,

as a Lender and L/C Issuer	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/s/ Matthew Koenig
 

Matthew Koenig
	 	 
	 

	 	Title:
	 	Senior Vice President	 	 






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SCHEDULE 2.01




COMMITMENTS

AND APPLICABLE PERCENTAGES




	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Applicable
	Lender	 	Commitment	 	Percentage
	Bank of America, N.A.
	 	$	100,000,000	 	 	 	100.000000000	%
	 
	 	 	 	 	 	 	 	 
	Total
	 	$	100,000,000	 	 	 	100.000000000	%






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SCHEDULE 2.03




EXISTING LETTERS OF CREDIT




	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Liability
	 	 	LC	 	 	 	 	 	Expiry	 	Original	 	Amount as of
	Name	 	Number	 	Issue Date	 	Date	 	Amount	 	3/29/2010
	Standby — Financial
	 	 	223317	 	 	 	06/05/1996	 	 	 	02/16/2011	 	 	$	243,378.00	 	 	$	33,000.00	 
	Standby — Financial
	 	 	223967	 	 	 	06/07/1996	 	 	 	09/30/2010	 	 	$	12,911,782.16	 	 	$	11,879,264.71	 
	Standby — Financial
	 	 	3044835	 	 	 	12/19/2001	 	 	 	10/01/2010	 	 	$	15,000,000.00	 	 	$	15,000,000.00	 
	Standby — Financial
	 	 	3052630	 	 	 	11/26/2002	 	 	 	10/01/2010	 	 	$	10,000,000.00	 	 	$	10,000,000.00	 
	Standby — Financial
	 	 	3055095	 	 	 	03/27/2003	 	 	 	10/01/2010	 	 	$	10,000,000.00	 	 	$	10,000,000.00	 
	Standby — Financial
	 	 	3073095	 	 	 	01/28/2005	 	 	 	12/31/2010	 	 	$	800,000.00	 	 	$	500,000.00	 
	Standby — Financial
	 	 	3081177	 	 	 	03/28/2006	 	 	 	12/31/2010	 	 	$	800,000.00	 	 	$	2,350,000.00	 






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SCHEDULE 5.17




SUBSIDIARIES AND EQUITY INTERESTS



Borrower owns 100% of the Equity Interests in the following Subsidiaries and has no other
Subsidiaries:




STATER BROS. DEVELOPMENT, INC.




SBM DAIRIES, INC.




SUPER RX, INC.




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SCHEDULE 7.01




EXISTING INDEBTEDNESS




	 	 	 

	7.01(d)
	 	Indebtedness (other than capital lease):
	 
	 
	 	 
	 
	 	Note payable due by Stater Bros. Markets to Stater Bros. Holdings, Inc. in the principal
	 
	 	amount of $50,000,000.00
	 
	 	 
	7.01(e)
	 	Indebtedness in respect of capital leases:
	 
	 
	 	 
	 
	 	$4,461,615.00






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SCHEDULE 7.02




EXISTING LIENS




	 	 	 

	7.02 (c)
	 	$0.00






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SCHEDULE 11.02




ADMINISTRATIVE AGENT’S OFFICE;

CERTAIN ADDRESSES FOR NOTICES




BORROWER AND HOLDINGS:




                                                                                




                                                                                




                                                                                

Attention:

Telephone:

Telecopier:

Electronic Mail:                     @___

Website Address: www.                                        




U.S. Taxpayer Identification Number:                                         




ADMINISTRATIVE AGENT:




Administrative Agent’s Office

(for payments and Requests for Credit Extensions of Base Rate Loans):

Bank of America, N.A.

275 Valencia Ave.

Brea, California 92823-6340

Attention: Sheryl Blevins

Telephone: (888) 841-8159 ext 61670

Telecopier: (877) 859-6304

Electronic Mail: sheryl.a.blevins@bankofamerica.com




Administrative Agent’s Office

(for payments and Requests for Credit Extensions of Eurodollar Rate Loans):

Bank of America, N.A.

Electronic Mail: creditservicesops-ratelocks@bankofamerica.com




Other Notices as Administrative Agent:

Bank of America, N.A.

Agency Management

333 South Hope Street, 13th Floor

Los Angeles, California 90071

Attention: Matthew Koenig

Telephone: (213) 621-7190

Telecopier: (312) 453-5583

Electronic Mail: matthew.koenig@bankofamerica.com




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L/C ISSUER:




Bank of America, N.A.

333 South Hope Street, Suite 1300,

Los Angeles, California 90071

Mailcode: CA9-193-13-01

Attention: Racquel Saika

Telephone: (213) 621-7161

Telecopier: (415) 796-5741

Electronic Mail: racquel.saika@bankofamerica.com





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