Exhibit
4.2


 


THIRD
AMENDED AND RESTATED SECURED CREDIT AGREEMENT


 


dated as
of the Third Restatement Date


among


 


OWENS-ILLINOIS
GROUP, INC., as Company


 


OWENS-BROCKWAY
GLASS CONTAINER INC., OI PLASTIC PRODUCTS FTS INC.,

UNITED GLASS LIMITED, OWENS-ILLINOIS (AUSTRALIA) PTY LIMITED,


ACI
OPERATIONS PTY LIMITED,

AZIENDE VETRARIE INDUSTRIALI
RICCIARDI – AVIR S.P.A.,  O-I CANADA CORP., and


BSN
GLASSPACK, S.A.

as Borrowers


 


OWENS-ILLINOIS
GENERAL, INC.,

as Borrowers’ Agent


 


THE
LENDERS LISTED HEREIN,


 


DEUTSCHE BANK SECURITIES INC. and
BANC OF AMERICA SECURITIES LLC,


as Tranche A1 Joint Lead
Arrangers and Tranche A1 Joint Book Managers


 


DEUTSCHE
BANK SECURITIES INC. and THE BANK OF NOVA SCOTIA,


as
Tranche B1 Joint Lead Arrangers


 


CITIGROUP
GLOBAL MARKETS INC. , DEUTSCHE BANK SECURITIES INC. and BANC OF AMERICA
SECURITIES LLC

as Tranche C Joint Lead Arrangers


 


DEUTSCHE
BANK SECURITIES INC., CITIGROUP GLOBAL MARKETS INC.


and
GOLDMAN SACHS CREDIT PARTNERS L.P.,


as
Tranche B1 Joint Book Managers


 


CITIGROUP
GLOBAL MARKETS INC. , DEUTSCHE BANK SECURITIES INC. , BANC OF AMERICA
SECURITIES LLC,


GOLDMAN
SACHS CREDIT PARTNERS L.P., BNP PARIBAS SECURITIES CORP, and THE BANK OF NOVA
SCOTIA,,


as
Tranche C Joint Book Managers


 


THE BANK
OF NOVA SCOTIA and BANC OF AMERICA SECURITIES LLC,


as
Tranche A1 and B1 Syndication Agents


 


 CITIGROUP GLOBAL MARKETS INC. and BANC OF
AMERICA SECURITIES LLC,


as
Tranche C Syndication Agents


 


CITIGROUP
GLOBAL MARKETS INC. and BANK ONE, NA,


As
Tranche A1 and B1 Documentation Agents


 


DEUTSCHE
BANK SECURITIES INC. and THE BANK OF NOVA SCOTIA,


As
Tranche C Documentation Agents


 


BNP
PARIBAS SECURITIES CORP, FLEET NATIONAL BANK AND CREDIT LYONNAIS,


as
Tranche Al and B1 Senior Managing Agents


 


BNP
PARIBAS SECURITIES CORP, THE BANK OF NOVA SCOTIA, FLEET NATIONAL BANK, BANK
ONE, NA, AND CREDIT LYONNAIS,


as
Tranche C Senior Managing Agents


 


DEUTSCHE
BANK AG London,


as UK
Administrative Agent,


 


and


 


DEUTSCHE
BANK TRUST COMPANY AMERICAS,


as
Administrative Agent


 





















 


TABLE OF CONTENTS


 


 


	
  SECTION 1

  	
   

  	
  DEFINITIONS

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  1.1

  	
   

  	
  Certain Defined Terms

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  1.2

  	
   

  	
  Accounting Terms; Utilization of GAAP
  for Purposes of Calculations Under Agreement; Change in Accounting Principles

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  1.3

  	
   

  	
  Other Definitional
  Provisions; Anniversaries

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  1.4

  	
   

  	
  Amendment and Restatement

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 2

  	
   

  	
  AMOUNT AND
  TERMS OF COMMITMENTS AND LOANS; NOTES

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  2.1

  	
   

  	
  Commitments; Making of Loans; Domestic
  Overdraft Account; Offshore Overdraft Accounts

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  2.2

  	
   

  	
  Interest on the Loans

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  2.3

  	
   

  	
  Fees

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  2.4

  	
   

  	
  Repayment
  and Prepayments; Reductions in Commitments

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  2.5

  	
   

  	
  Use of Proceeds

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  2.6

  	
   

  	
  Special
  Provisions Governing Euro Rate Loans

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  2.7

  	
   

  	
  Capital Adequacy
  Adjustment; Increased Costs; Taxes

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  2.8

  	
   

  	
  Letters of Credit

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  2.9

  	
   

  	
  Joint and
  Several Liability; Contribution; O-I General as Borrowers’ Agent

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  2.10

  	
   

  	
  Collection Allocation
  Mechanism

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 3

  	
   

  	
  CONDITIONS
  TO THIRD RESTATEMENT DATE; FRENCH TRANCHE C3 TERM LOANS; LOANS AND LETTERS OF
  CREDIT

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  3.1

  	
   

  	
  Conditions to
  Third Restatement Date.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  3.4

  	
   

  	
  Conditions to All Loans.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  3.5

  	
   

  	
  Conditions to Letters
  of Credit

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 4

  	
   

  	
  LOAN
  PARTIES’ REPRESENTATIONS AND WARRANTIES

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  4.1

  	
   

  	
  Organization, Powers, Good Standing,
  Business and Subsidiaries

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  4.2

  	
   

  	
  Authorization of Borrowing,
  Etc.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  4.3

  	
   

  	
  Financial Condition

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  4.4

  	
   

  	
  No Adverse Material Change;
  No Restricted Junior Payment

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  4.5

  	
   

  	
  Litigation; Adverse Facts

  	
   

  



 


i





















 


	
  4.6

  	
   

  	
  Payment of Taxes

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  4.7

  	
   

  	
  Governmental Regulation

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  4.8

  	
   

  	
  Securities Activities

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  4.9

  	
   

  	
  Employee Benefit Plans

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  4.10

  	
   

  	
  Disclosure

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  4.11

  	
   

  	
  Environmental Protection

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  4.12

  	
   

  	
  Title to Properties; Liens; Real
  Property; Intellectual Property

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  4.13

  	
   

  	
  Solvency

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  4.14

  	
   

  	
  Matters Relating to
  Collateral

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 5

  	
   

  	
  COMPANY’S
  AFFIRMATIVE COVENANTS

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  5.1

  	
   

  	
  Financial
  Statements and Other Reports

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  5.2

  	
   

  	
  Corporate Existence, Etc.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  5.3

  	
   

  	
  Payment of Taxes and
  Claims; Tax Consolidation

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  5.4

  	
   

  	
  Maintenance of Properties;
  Insurance; Application of Net Insurance/Condemnation Proceeds

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  5.5

  	
   

  	
  Inspection; Lender Meeting

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  5.6

  	
   

  	
  Compliance with Laws, Etc.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  5.7

  	
   

  	
  Securities Activities

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  5.8

  	
   

  	
  Environmental Matters

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  5.9

  	
   

  	
  Execution
  of Subsidiary Guaranty and Security Agreement After the Third Restatement
  Date

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  5.10

  	
   

  	
  Real Estate Matters

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 6

  	
   

  	
  COMPANY’S
  NEGATIVE COVENANTS

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  6.1

  	
   

  	
  Indebtedness

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  6.2

  	
   

  	
  Liens and Related Matters

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  6.3

  	
   

  	
  Investments; Acquisitions

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  6.4

  	
   

  	
  Contingent Obligations

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  6.5

  	
   

  	
  Restricted Junior Payments

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  6.6

  	
   

  	
  Financial Covenants

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  6.7

  	
   

  	
  Restriction on Fundamental
  Changes; Asset Sales

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  6.8

  	
   

  	
  Consolidated Capital
  Expenditures

  	
   

  



 


ii





















 


	
  6.9

  	
   

  	
  Transactions
  with Shareholders and Affiliates

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  6.10

  	
   

  	
  Sales and Lease Backs

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  6.11

  	
   

  	
  Conduct of Business

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  6.12

  	
   

  	
  Amendments of
  Documents Relating to Restricted Debt Obligations; No Prepayments of
  Restricted Debt Obligations

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  6.1

  	
   

  	
  Indebtedness

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  6.2

  	
   

  	
  Liens and Related Matters

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  6.3

  	
   

  	
  Investments; Acquisitions

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  6.4

  	
   

  	
  Contingent Obligations

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  6.5

  	
   

  	
  Restricted Junior Payments

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  6.6

  	
   

  	
  Financial Covenants

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  6.7

  	
   

  	
  Restriction on Fundamental
  Changes; Asset Sales

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  6.8

  	
   

  	
  Consolidated Capital
  Expenditures

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  6.9

  	
   

  	
  Transactions
  with Shareholders and Affiliates

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  6.10

  	
   

  	
  Sales and Lease Backs

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  6.11

  	
   

  	
  Conduct of Business

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  6.12

  	
   

  	
  Amendments of
  Documents Relating to Restricted Debt Obligations; No Prepayments of Restricted
  Debt Obligations

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 7

  	
   

  	
  EVENTS OF
  DEFAULT

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  7.1

  	
   

  	
  Failure to Make
  Payments When Due

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  7.2

  	
   

  	
  Default in Other Agreements

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  7.3

  	
   

  	
  Breach of Certain Covenants

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  7.4

  	
   

  	
  Breach of Warranty

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  7.5

  	
   

  	
  Other
  Defaults under Agreement or Loan Documents

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  7.6

  	
   

  	
  Involuntary Bankruptcy;
  Appointment of Receiver, Etc.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  7.7

  	
   

  	
  Voluntary Bankruptcy; Appointment
  of Receiver, Etc.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  7.8

  	
   

  	
  Judgments and Attachments

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  7.9

  	
   

  	
  Dissolution

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  7.10

  	
   

  	
  Change of Control

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  7.11

  	
   

  	
  Employee Benefit Plans

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  7.12

  	
   

  	
  Invalidity
  of Guaranties; Failure of Security

  	
   

  



 


iii





















 


	
  7.13

  	
   

  	
  Activities of Holdings; OI
  General FTS; Harbor Capital Subsidiaries; BSN Financing Co. S.A. and BSN
  Glasspack Obligation S.A. and their respective Subsidiaries

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 8

  	
   

  	
  AGENTS

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  8.1

  	
   

  	
  Appointments

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  8.2

  	
   

  	
  Powers; General Immunity

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  8.3

  	
   

  	
  Representations and
  Warranties; No Responsibility for Appraisal of Creditworthiness

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  8.4

  	
   

  	
  Right to Indemnity

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  8.5

  	
   

  	
  Registered Persons
  Treated as Owners

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  8.6

  	
   

  	
  Successor
  Agents and Domestic Overdraft Account Provider

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  8.7

  	
   

  	
  Intercreditor Agreement,
  Subsidiary Guaranty and Collateral Documents

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 9

  	
   

  	
  COMPANY
  GUARANTY

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  9.1

  	
   

  	
  Guaranty

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  9.2

  	
   

  	
  Waivers

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  9.3

  	
   

  	
  Payment

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  9.4

  	
   

  	
  Waiver of Subrogation, Etc.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  9.5

  	
   

  	
  Termination

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  9.6

  	
   

  	
  Security

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION
  10

  	
   

  	
  MISCELLANEOUS

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  10.1

  	
   

  	
  Representation of Lenders

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  10.2

  	
   

  	
  Assignments and
  Participations in Loans, Notes and Letters of Credit

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  10.3

  	
   

  	
  Expenses

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  10.4

  	
   

  	
  Indemnity

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  10.5

  	
   

  	
  Set Off

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  10.6

  	
   

  	
  Ratable Sharing

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  10.7

  	
   

  	
  Amendments and Waivers

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  10.7A 

  	
   

  	
  Additional
  Amendment and Waiver Matters

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  10.8

  	
   

  	
  Independence of Covenants

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  10.9

  	
   

  	
  Change in Accounting Principles,
  Fiscal Year or Tax Laws

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  10.10

  	
   

  	
  Notices

  	
   

  



 


iv





















 


	
  10.11

  	
   

  	
  Survival
  of Warranties and Certain Agreements

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  10.12

  	
   

  	
  Failure
  or Indulgence Not Waiver; Remedies Cumulative

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  10.13

  	
   

  	
  Severability

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  10.14

  	
   

  	
  Obligations
  Several; Independent Nature of Lenders’ Rights

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  10.15

  	
   

  	
  Headings

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  10.16

  	
   

  	
  Applicable Law

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  10.17

  	
   

  	
  Successors and Assigns

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  10.18

  	
   

  	
  Consent
  to Jurisdiction and Service of Process

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  10.19

  	
   

  	
  Waiver of Jury Trial

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  10.20

  	
   

  	
  Confidentiality

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  10.21

  	
   

  	
  Judgment Currency

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  10.22

  	
   

  	
  Additional Offshore
  Borrowers

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  10.24

  	
   

  	
  Limitation
  on Offshore Borrower Obligations

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  10.25

  	
   

  	
  Counterparts; Effectiveness

  	
   

  



 


v





















 


OWENS-ILLINOIS
GROUP, INC.


OWENS-BROCKWAY
GLASS CONTAINER INC.


OI
PLASTIC PRODUCTS FTS INC.


UNITED
GLASS LIMITED


OWENS
ILLINOIS (AUSTRALIA) PTY LIMITED


ACI
OPERATIONS PTY LIMITED


AZIENDE
VETRARIE INDUSTRIALI RICCIARDI — AVIR S.P.A.


O-I
CANADA CORP.


BSN
GLASSPACK, S.A.


 


THIRD AMENDED
AND RESTATED

SECURED CREDIT AGREEMENT


 


DATED AS
OF October 7, 2004


 


This THIRD AMENDED AND RESTATED SECURED CREDIT AGREEMENT is dated as of October 7, 2004, and entered
into by and among OWENS-ILLINOIS GROUP, INC.,
a Delaware corporation (“Company”),
OWENS-BROCKWAY GLASS CONTAINER INC.,
a Delaware corporation (“Owens-Brockway”),
OI PLASTIC PRODUCTS FTS INC., a
Delaware corporation (“O-I Plastic”), UNITED GLASS LIMITED, a limited liability company
incorporated under the laws of England and Wales (registered number 526983) (“United Glass”), OWENS
ILLINOIS (AUSTRALIA) PTY LIMITED, a limited liability company
organized under the laws of Australia (“O-I
Australia”), ACI OPERATIONS PTY
LIMITED, a limited liability company organized under the laws of
Australia (“ACI”), AZIENDE VETRARIE INDUSTRIALI RICCIARDI — AVIR S.P.A.,
a joint stock company organized under the laws of Italy (“Avir”), O-I
CANADA CORP., a Nova Scotia corporation (“O-I Canada”), BSN GLASSPACK, S.A.,
a French societe anonyme (“BSN”) and OWENS-ILLINOIS GENERAL, INC., a Delaware corporation (“O-I General”), as Borrowers’ Agent
(in such capacity “Borrowers’ Agent”),
THE LENDERS LISTED ON THE SIGNATURE PAGES HEREOF
(each individually a “Lender” and
collectively, “Lenders”), DEUTSCHE BANK SECURITIES INC. (“DB Securities”) and BANC OF AMERICA SECURITIES LLC (“BAS”), as Joint Lead Arrangers and Joint
Book Managers with respect to the Revolving Loans and the Tranche A1 Term Loans
(collectively, the “Tranche A1 Joint Lead
Arrangers” and “Tranche A1 Joint
Book Managers”), DB Securities and THE
BANK OF NOVA SCOTIA (“Scotia
Capital”) as the Joint Lead Arrangers with respect to the Tranche B1
Term Loans (collectively, the “Tranche B1
Joint Lead Arrangers”), DB Securities, CITIGROUP
GLOBAL MARKETS INC. (“CGMI”) and GOLDMAN
SACHS CREDIT PARTNERS L.P. (“GS”),
as the Joint Book Managers with respect to the Tranche B1 Term Loans
(collectively, the “Tranche B1 Joint Book
Managers”), CGMI, DB Securities and BAS as Joint Lead Arrangers for
the Tranche C Term Loans (the “Tranche C Joint Lead
Arrangers”), CGMI, DB Securities, BAS, GS, Scotia Capital, BNP PARIBAS SECURITIES CORP. (“BNPPSC”),
as Joint Book Managers for the Tranche C Term Loans (the “Tranche C
Joint Book Managers”), Scotia Capital and BAS, as Co-Syndication
Agents with respect to the Revolving Loans,


 


1





















 


Tranche A1 Term Loans and the Tranche B1 Term Loans
(collectively, the “Tranche A1 and B1 Co-Syndication Agents”), CGMI and BANK ONE, NA, as Co-Documentation
Agents with respect to the Revolving Loans, Tranche A1 Term Loans and the
Tranche B1 Term Loans (collectively, the “Co-Documentation
Agents”), DB Securities and Bank of Nova Scotia, as Co-Documentation
Agents with respect to the Tranche C Term Loans (the “Tranche C
Documentation Agents”), CGMI and BAS as Co-Syndication Agents with
respect to the Tranche C Term Loans (the “Tranche C Syndication
Agents”), Fleet,  BNPPSC and Lyonnais, as Senior Managing Agents with respect to the Revolving
Loans, Tranche A1 Term Loans and Tranche B1 Term Loans (the “Tranche A1 and B1  Senior
Managing Agents”), FLEET NATIONAL
BANK,  BNPPSC, CREDIT LYONNAIS, Scotia Capital and Bank
One, NA, as Senior Managing Agents with respect to the Tranche C Term Loans
(the “Tranche C Senior Managing Agents”),  DEUTSCHE
BANK AG London, as UK Administrative Agent for the Lenders (“UK Administrative Agent”), and DEUTSCHE BANK TRUST
COMPANY AMERICAS (“DB”),
as Administrative Agent for Lenders (“Administrative Agent”).


 


RECITALS


 


WHEREAS,
the Company, the borrowers under the Original Credit Agreement, the lenders
under the Original Credit Agreement and certain of the Agents entered into the
Original Credit Agreement and on the Original Closing Date all conditions to
closing thereunder set forth therein were satisfied (capitalized terms used
herein shall have the meanings assigned thereto in Section 1 hereof).


 


WHEREAS,
pursuant to the Original Credit Agreement, the arrangers with respect thereto,
on behalf of the Australian Offshore Borrowers offered the “Australian Loans”
thereunder to certain persons, including the lenders thereunder, being persons
carrying on a business of providing finance, or investing or dealing in
securities, in the course of operating in financial markets, by inviting the offerees,
through delivery of an information memorandum and participation in subsequent
conferences, correspondence and negotiations among the arrangers, agents,
lenders and borrowers party to the Original Credit Agreement, to subscribe for
such “Australian Loans” (issued as debentures in inscribed form and evidenced
by the “Australian Loan Notes” issued under the Original Credit Agreement), and
the lenders party to the Original Credit Agreement accepted the invitation of
the Australian Offshore Borrowers and subscribed for and acquired such “Australian
Loans” and such “Australian Loan Notes.”


 


WHEREAS,
the Company, certain of the Borrowers and certain lenders party thereto entered
into the First Amended and Restated Secured Credit Agreement dated as of June 13,
2003 (the “First Amended and Restated Credit Agreement”),
pursuant to which the Original Credit Agreement was amended and restated in its
entirety such that the Separated Funded Loans and the General Revolving Loans
(as defined in the Original Credit Agreement) outstanding under the Original
Credit Agreement were converted into “Tranche A Term Loans”, “Tranche B Term
Loans”, “Revolving Loans” and “Australian Revolving Loans” thereunder as set
forth therein;


 


WHEREAS ̧ in connection with the First Amended and Restated Secured Credit
Agreement, the arrangers with respect thereto, on behalf of ACI, offered the “Existing
Australian Loans” (as defined therein) to certain persons, including the
lenders thereunder, being persons carrying on a business of providing finance,
or investing or dealing in securities, in the course of operating in financial
markets, by inviting the offerees, through delivery of an information


 


2





















 


memorandum and participation in subsequent conferences,
correspondence and negotiations among the arrangers, agents, lenders and
borrowers party thereto, to purchase and assume such Existing Australian Loans
(which were amended and restated as “Tranche A Term Loans” and “Australian
Revolving Loans” under the First Amended and Restated Credit Agreement) and to
make available further “Australian Revolving Loans” thereunder  (issued as debentures in inscribed form and
evidenced by “Australian Revolving Loan Notes” thereunder), and the lenders
party thereto accepted such invitation;


 


WHEREAS, pursuant to that certain First Amendment to First Amended and Restated
Secured Credit Agreement dated as of December 4, 2003 (the “December 2003
Amendment”), the First Amended and Restated Credit Agreement was amended such
that (i) the outstanding Tranche A Term Loans thereunder were converted into
the Tranche A1 Term Loans and (ii) the outstanding Tranche B Term Loans
thereunder were converted into the Tranche B1 Term Loans;


 


WHEREAS, the Company, certain of the Borrowers and certain lenders party thereto
entered into the Second Amended and Restated Secured Credit Agreement dated as
of March 15, 2004 (the “Second Amended and Restated Credit Agreement”),
pursuant to which the First Amended and Restated Credit Agreement (as amended
by the December 2003 Amendment) was amended and restated in its entirety and
pursuant to which certain lenders party thereto agreed to extend Domestic
Tranche C Term Loans, French Tranche C1 Term Loans, French Tranche C2 Term
Loans and Tranche D Term Loans to finance O-I Europe SAS’s acquisition of all
of the outstanding shares of BSN and the BSN Subordinated Shareholder Loan (as
hereinafter defined) to refinance certain indebtedness of BSN and to pay
related fees and expenses;


 


WHEREAS, on June 21, 2004, BSN became a party to the Second Amended and Restated
Credit Agreement, the other conditions to the making of the Domestic Tranche C
Term Loans, Tranche C1 Term Loans, French Tranche C2 Term Loans and Tranche D
Term Loans were satisfied, such loans were made to Owens-Brockway and BSN, as
applicable, the BSN Acqusition was consummated, certain existing Indebtedness
of BSN and its Subsidiaries was repaid, and related fees and expenses were
paid;


 


WHEREAS, on or about July 28, 2004, Holdings and O-I Plastic entered into a
Stock Purchase Agreement (the “Plastics Sale Agreement”) pursuant to which
Holdings and O-I Plastic agreed to conduct certain corporate restructurings and
thereafter to sell all of the Capital Stock of Owens-Brockway Plastic Products
Inc. to Graham Packaging Company, L.P. or to an affiliate thereof (the “Plastics
Sale”);


 


WHEREAS, pursuant to the First Amendment to the Second Amended and Restated Credit
Agreement dated as of September 24, 2004 (the “First Amendment”), the lenders
party thereto consented to the corporate restructurings contemplated by the
Plastics Sale Agreement  and to the
consummation of the Plastics Sale in accordance with the terms of the Plastics
Sale Agreement;


 


WHEREAS, pursuant to the First Amendment, upon satisfaction of the conditions
set forth in Section 7 thereof, including, without limitation, the consummation
of the Plastics Sale and the application of the Net Asset Sale Proceeds arising
therefrom in accordance


 


3





















 


with the terms of the Second Amended and Restated
Credit Agreement (as amended by the First Amendment), the Second Amended and
Restated Credit Agreement is to be amended and restated in its entirety in the
form of this Third Amended and Restated Secured Credit Agreement without any
further action on behalf of the Lenders; the effectiveness of this Agreement to
be conclusively evidenced by the execution and delivery of this Agreement by
the Company, the Borrowers and the Administrative Agent;


 


WHEREAS,
the Revolving Loan Commitments and the proceeds of the Revolving Loans and
Offshore Revolving Loans will continue to be used by the applicable Borrowers
to (i) provide working capital for Company and its Subsidiaries (including
Borrowers), (ii) to provide for commercial and standby letter of credit
requirements, (iii) subject to the terms and conditions herein, to provide
funds to redeem, repay or otherwise repurchase certain Existing Holdings Senior
Notes due 2005 and 2007 and (iv) to provide funds for other general corporate
purposes of Borrowers and their Subsidiaries;


 


WHEREAS,
Domestic Borrowers will continue to secure all of their Obligations hereunder
and under the other Loan Documents and in respect of Other Lender Guarantied
Obligations, pursuant to a First Priority Lien granted to Collateral Agent, on
behalf of the Lenders and the holders of Other Lender Guarantied Obligations,
on substantially all of their respective real, personal and mixed property,
including a pledge of all of the Capital Stock of substantially all of their Domestic
Subsidiaries (other than O-I General FTS Inc.);


 


WHEREAS, Company and substantially all of the
wholly-owned Domestic Subsidiaries of Company will continue to guarantee the
Obligations of the Domestic Borrowers hereunder and under the other Loan
Documents and the Other Lender Guarantied Obligations, and secure their guaranties
pursuant to a First Priority Lien granted to Collateral Agent, on behalf of the
Lenders and the holders of Other Lender Guarantied Obligations, on
substantially all of their respective real, personal and mixed property,
including a pledge of all of the Capital Stock of substantially all of their
Domestic Subsidiaries and 65% of the Capital Stock of the first-tier Foreign
Subsidiaries owned by any such Domestic Subsidiary;


 


WHEREAS, Company and substantially all of
the wholly-owned Domestic Subsidiaries of Company will continue to guarantee
the Obligations of the Offshore Borrowers and secure their guaranties pursuant
to a First Priority Lien granted to Collateral Agent, on behalf of the Lenders,
on substantially all of their respective real, personal and mixed property and
35% of the Capital Stock of the first-tier Foreign Subsidiaries owned by any
such Domestic Subsidiary not pledged to secure the Obligations of the Domestic
Borrowers;


 


WHEREAS, United Glass will continue to
secure its Obligations hereunder and under the other Loan Documents (and each
English Wholly-Owned Subsidiary of United Glass will continue to guarantee the
Obligations of United Glass and secure their respective guaranties) pursuant to
a First Priority Lien granted to Collateral Agent, on behalf of the Lenders, on
substantially all of their real, personal and mixed property;


 


WHEREAS, United Glass will continue to
guarantee the Obligations of the other Offshore Borrowers, and each English
Wholly-Owned Subsidiary of United Glass will continue to guaranty such
obligations of United Glass, and United Glass and such English Wholly-Owned


 


4





















 


Subsidiaries
shall continue to secure their respective guaranties pursuant to a First
Priority Lien granted to Collateral Agent, on behalf of the Lenders, on
substantially all of their real, personal and mixed property;


 


WHEREAS, the Australian Offshore Borrowers
will continue to secure their Obligations hereunder and under the other Loan
Documents (and each Australian Wholly-Owned Subsidiary of any Australian
Offshore Borrower will continue to guarantee the Obligations of the Australian
Offshore Borrowers and secure their respective guaranties) pursuant to a First
Priority Lien granted to Collateral Agent, on behalf of the Lenders, on
substantially all of their real, personal and mixed property;


 


WHEREAS,
the Australian Offshore Borrowers and each Australian Wholly-Owned Subsidiary
of any Australian Offshore Borrower will continue to guaranty the Obligations
of BSN hereunder and under the Loan Documents and shall secure their respective
guarantees pursuant to a First Priority Lien granted to Collateral Agent, on
behalf of the Lenders, on substantially all of their real, personal and mixed
property;


 


WHEREAS,
BSN will continue to secure its Obligations hereunder and under the other Loan
Documents (and each Subsidiary of BSN that is an Offshore Guarantor will continue
to guarantee the Obligations of BSN and secure their respective guaranties)
pursuant to a First Priority Lien granted to Collateral Agent, on behalf of the
Lenders, on certain of their real, personal and mixed property;


 


WHEREAS,
it is the intent of the Loan Parties to confirm that all Obligations of Loan
Parties under the other Loan Documents shall continue in full force and effect
and that, from and after the Third Restatement Date, all references to the “Credit Agreement” contained therein shall be deemed to refer
to this Agreement.


 


NOW,
THEREFORE, in consideration of the premises and the
agreements, provisions and covenants herein contained, Company, Borrower’s
Agent, Borrowers, Lenders, Arrangers and Agents hereby agree that on the Third
Restatement Date the Second Amended and Restated Credit Agreement shall be
amended and restated in its entirety as follows:


 


SECTION 1


 


DEFINITIONS


 


1.1          Certain
Defined Terms


 


The
following terms used in this Agreement shall have the following meanings:


 


“ACI” has the meaning assigned to that term
in the introduction to this Agreement.


 


“Acquired Indebtedness” means Indebtedness
of a Person or any of its Subsidiaries existing at the time such Person becomes
a Subsidiary of Company or at the time it merges or consolidates with Company
or any of its Subsidiaries or assumed by Company or any of its Subsidiaries in
connection with the acquisition of assets from such Person, and in each case


 


5





















 


not
incurred by such Person in connection with, or in anticipation or contemplation
of, such Person becoming a Subsidiary of Company or such acquisition, merger or
consolidation; provided, that Indebtedness of BSN and its Subsidiaries as of
the BSN Acquisition Closing Date shall not constitute Acquired Indebtedness.


 


“Acquisition” has the meaning assigned such
term in subsection 6.3.


 


“Acquisition Collateral Account” has the
meaning set forth in subsection 2.4B(ii)(d).


 


“Acquisition Sublimit” has the meaning set
forth in subsection 2.4B(ii)(d).


 


“Additional Mortgage” has the meaning set forth in
subsection 5.10A(i).


 


“Additional Mortgaged Property” has the meaning set forth in
subsection 5.10A


 


 “Additional
Offshore Borrower” has the meaning assigned to that term in
subsection 10.22.


 


“Additional Term Loans” has the meaning
assigned to that term in subsection 2.1A(vi).


 


“Adjusted Eurodollar Rate” means, for any Interest Rate
Determination Date with respect to a Eurodollar Rate Loan, the rate obtained by
dividing (i) the arithmetic average (rounded upward to the nearest
1/100 of one percent) of the offered quotation, if any, to first class banks in
the interbank Eurodollar market by each of the Reference Lenders for U.S.
dollar deposits of amounts in Same Day Funds comparable to the principal amount
of the Eurodollar Rate Loan of that Reference Lender for which the Adjusted
Eurodollar Rate is then being determined with maturities comparable to the
Interest Period for which such Adjusted Eurodollar Rate will apply as of
approximately 11:00 A.M. (New York time) on such Interest Rate Determination
Date by (ii) a percentage equal to 100% minus the stated maximum
rate of all reserve requirements (including, without limitation, any marginal,
emergency, supplemental, special or other reserves) applicable to any member
bank of the Federal Reserve System in respect of “Eurocurrency liabilities” as
defined in Regulation D (or any successor category of liabilities under
Regulation D); provided that if any Reference Lender fails to provide
Administrative Agent with its aforementioned quotation then the Adjusted
Eurodollar Rate shall be determined based on the quotation(s) provided to
Administrative Agent by the other Reference Lender(s); provided, further,
that, to the extent Lenders make UK Revolving Loans through UK Lending Offices “Adjusted
Eurodollar Rate” shall be increased for such Lenders to include the additional
cost (expressed as a percentage per annum and rounded upwards, if necessary, to
the nearest five decimal places) to such Lenders of complying with the
requirements of the Bank of England, the Financial Services Authority and/or
any other relevant monetary or regulatory authority in respect of monetary
control, liquidity or otherwise from time to time (and any such Lender shall provide
Borrower’s Agent with a written statement setting out in reasonable detail the
amount and calculation of such additional cost).


 


6





















 


“Administrative Agent” has the meaning assigned to that term
in the introduction to this Agreement and also includes any successor
Administrative Agent appointed pursuant to subsection 8.6.


 


“ADollars” and the sign “A$” mean the
lawful currency of Australia.


 


“Affected Lender” means any Lender affected by any of the
events described in subsection 2.6B or 2.6C.


 


“Affiliate”, as applied to any Person, means any other Person
directly or indirectly controlling, controlled by, or under common control
with, that Person.  For the purposes of
this definition, “control” (including with correlative meanings, the terms “controlling”,
“controlled by” and “under common control with”), as applied to any Person,
means the possession, directly or indirectly, of the power to direct or cause
the direction of the management and policies of that Person, whether through
the ownership of voting securities or by contract or otherwise.


 


“Agents” means the Administrative Agent and the Tranche C
Co-Syndication Agents and, for purposes of  Section 8 and Section 9 and
the Collateral Documents only, Collateral Agent.


 


“Agreement” means this Third Amended and Restated Secured
Credit Agreement dated as of October 7, 2004, as it may be amended,
supplemented or otherwise modified from time to time.


 


“Aggregate Amounts Due” has the meaning assigned to that term
in subsection 10.6.


 


“Aggregate Offshore Sublimit” means the lesser of (i) $533,000,000
and (ii) the Revolving Loan Commitments then in effect.


 


“Applicable Base Rate Margin” means, for any
Term Loans or Revolving Loans, as at any date of determination, a rate per
annum equal to the percentage set forth below for such Type of Loan opposite
the Applicable Leverage Ratio in effect as of such date of determination, any
change in the Applicable Base Rate Margin to be effective on the date of any
corresponding change in the Applicable Leverage Ratio:


 




	
  Applicable Leverage Ratio

  (Revolving Loans)

  	
   

  	
  Applicable Base Rate

  Margin (Revolving Loans)

  	
   

  
	
  Less than 3.0:1

  	
   

  	
  1.2500

  	
  %

  
	
   

  	
   

  	
   

  	
   

  
	
  3.0:1 or greater
  but less than 3.5:1

  	
   

  	
  1.5000

  	
  %

  
	
   

  	
   

  	
   

  	
   

  
	
  Greater than or
  equal to 3.5:1

  	
   

  	
  1.7500

  	
  %

  






 


7





















 


 




	
  Applicable Leverage Ratio

  (Term Loans)

  	
   

  	
  Applicable Base Rate

  Margin (Term Loans)

  	
   

  
	
  Less than 3.75:1

  	
   

  	
  1.5000

  	
  %

  
	
   

  	
   

  	
   

  	
   

  
	
  Greater than or
  equal to 3.75:1

  	
   

  	
  1.7500

  	
  %

  






 


provided, that, that if at
any time there are Refinancing Term Loans outstanding and the Refinancing Term
Loan Margin exceeds the Applicable Base Rate Margin otherwise applicable to the
Term Loans, then the Applicable Base Rate Margin for all Term Loans shall be
the Refinancing Term Loan Margin, and shall remain at such level for so long as
such level exceeds the Applicable Base Rate Margin that would otherwise apply
to the Term Loans.


 


“Applicable Currency” means, with respect to any particular
Letter of Credit or Domestic Overdraft Amount or Offshore Overdraft Amount,
Dollars or the applicable Offshore Currency in which such Letter of Credit or
Domestic Overdraft Amount or Offshore Overdraft Amount is denominated or
payable.


 


“Applicable Euro Margin” means, for any Term Loans, Revolving
Loans or Offshore Revolving Loans, as at any date of determination, a rate per
annum equal to the percentage set forth below for such Type of Loan opposite
the Applicable Leverage Ratio in effect as of such date of determination, any
change in the Applicable Euro Margin to be effective on the date of any
corresponding change in the Applicable Leverage Ratio:


 




	
  Applicable Leverage Ratio

  (Revolving Loans and

  Offshore Revolving Loans)

  	
   

  	
  Applicable Euro Margin

  (Revolving Loans and

  Offshore Revolving Loans)

  	
   

  
	
  Less than 3.0:1

  	
   

  	
  2.2500

  	
  %

  
	
   

  	
   

  	
   

  	
   

  
	
  3.0:1 or greater
  but less than 3.5:1

  	
   

  	
  2.5000

  	
  %

  
	
   

  	
   

  	
   

  	
   

  
	
  Greater than or
  equal to 3.5:1

  	
   

  	
  2.7500

  	
  %

  






 




	
  Applicable Leverage Ratio

  (Term Loans)

  	
   

  	
  Applicable Euro Margin
(Term Loans)

  	
   

  
	
  Less than 3.75:1

  	
   

  	
  2.5000

  	
  %

  
	
   

  	
   

  	
   

  	
   

  
	
  Greater than or
  equal to 3.75:1

  	
   

  	
  2.7500

  	
  %

  






 


provided, that, that if at
any time there are Refinancing Term Loans outstanding and the Refinancing Term
Loan Margin exceeds the Applicable Euro Margin otherwise applicable to the Term
Loans, then the Applicable Euro Margin for all Term Loans shall be the
Refinancing Term


 


8





















 


Loan Margin, and shall remain at such level for so
long as such level exceeds the Applicable Euro Margin that would otherwise
apply to the Term Loans.


 


“Applicable Leverage Ratio” means, with respect to any date
of determination, the Consolidated Leverage Ratio set forth in the Effective
Pricing Certificate (as defined below) in respect of the Pricing Period (as
defined below) in which such date of determination occurs; provided that with
respect to the Tranche C Term Loans for the period beginning from the Second
Restatement Date to but excluding the date of commencement of the first Pricing
Period beginning upon the delivery of an Effective Pricing Certificate for the
first Fiscal Quarter ending more than 90 days after the BSN Acquisition Closing
Date, the Applicable Leverage Ratio shall be deemed to be greater than 3.75:1.  For purposes of this definition, (i) ”Pricing Certificate” means an Officers’ Certificate of
Borrowers’ Agent delivered (a) in the case of any of the first three Fiscal
Quarters (beginning with the Fiscal Quarter ending September 30, 2004) of any
Fiscal Year, within 45 days after the end of such Fiscal Quarter, (b) in
the case of the fourth Fiscal Quarter of any Fiscal Year, within 90 days after
the end of such Fiscal Quarter, (c) following the date of consummation of a
sale of equity Securities of Holdings in an offering, or (d) following any Pro
Forma Event, in each case certifying as to the Consolidated Leverage Ratio,
calculated on a Pro Forma Basis, as of the last day of such Fiscal Quarter or
as of the date of consummation of such sale of equity Securities or Pro Forma
Event after giving effect to the application of the proceeds thereof, as the case
may be, and setting forth the calculation of such Consolidated Leverage Ratio
in reasonable detail, which Officers’ Certificate, in the case of the
immediately preceding clauses (a) and (b), may be delivered to Administrative
Agent at any time on or after the date of delivery by Borrowers’ Agent of the
Compliance Certificate with respect to the period ending on the last day of the
applicable Fiscal Quarter pursuant to subsection 5.1(iii),
and (ii) ”Pricing Period”
means each period commencing on the second Business Day after the delivery (or
deemed delivery as provided below) to Administrative Agent of a Pricing
Certificate (the “Effective Pricing
Certificate” in respect of such Pricing Period) and ending on the
first Business Day after the next Pricing Certificate is delivered (or deemed
to be delivered as provided below) to Administrative Agent; provided
that, in the event Borrowers’ Agent fails to deliver to Administrative Agent a
Pricing Certificate on or before the 45th day after the end of any of the first
three Fiscal Quarters of any Fiscal Year or the 90th day after the end of the
fourth Fiscal Quarter of any Fiscal Year or the 10th Business Day
after the occurrence of any Pro Forma Event (the “Cutoff Date”
with respect to any such Fiscal Quarter), Borrowers’ Agent shall be deemed to
have delivered to Administrative Agent, on the Cutoff Date, a Pricing
Certificate which establishes that the Consolidated Leverage Ratio as of the
last day of such Fiscal Quarter or as of the occurrence of the Pro Forma Event,
as applicable, was greater than 3.5:1 in the case of the Revolving Loans and
Offshore Revolving Loans, or greater than 3.75:1 in the case of the Tranche A1
Term Loans, Tranche B1 Term Loans and Tranche C Term Loans.


 


“Applicable Percentage” means, (i) in the
case of Net Equity Securities Proceeds arising from the issuance of Permitted
Preferred Stock by Holdings, 100%, and (ii) otherwise means 50%.


 


“Arranger” and “Arrangers”
means the Tranche A1 Joint Lead Arrangers, the Tranche B1 Joint Lead Arrangers,
the Tranche A1 Joint Book Managers, the Tranche B1 Joint Book Managers, the
Tranche C Joint Lead Arrangers and the Tranche C Joint Book Managers (as those
terms are defined in the introduction to this Agreement).


 


9





















 


“Asbestos Reserve” means the aggregate reserve of Holdings
and its Subsidiaries for claims (including anticipated claims) of persons
against Holdings for exposure to asbestos-containing products and expenses
related thereto.


 


“Asset Sale” means the sale, transfer or other disposition by
Company or any of its Subsidiaries (including Borrowers) to any Person (other
than sales, transfers or other dispositions (1) to any Loan Party (other
than Avir or O-I Canada), (2) by any Loan Party to Avir, O-I Canada or any
Subsidiary of Company that is not a Loan Party of assets the aggregate value of
which for all such sales, transfers or other dispositions after the Second
Restatement Date less the aggregate value of all sales, transfers or
other dispositions from Avir, O-I Canada, or any Subsidiary that is not a Loan
Party to any Loan Party after the Second Restatement Date does not exceed
$200,000,000, or (3) by a non-Loan Party to Company or any of its Subsidiaries)
in a single transaction or a related series of transactions of (i) any of
the stock of any of Company’s Subsidiaries (including any Foreign Subsidiary),
(ii) substantially all of the assets of any geographic or other division
or line of business of Company or any of its Subsidiaries (including any
Foreign Subsidiary), or (iii) any other assets (including, without
limitation, any assets which do not constitute substantially all of the assets
of any geographic or other division or line of business but  excluding
(a) any assets manufactured, constructed or otherwise produced or purchased for
sale to others in the ordinary course of business consistent with the past
practices of Company and its Subsidiaries (b) any accounts receivable sold by
Company or any of its Subsidiaries in connection with Receivables Sale
Indebtedness and (c) any inventory sold by BSN or any of its Subsidiaries in
connection with Indebtedness permitted under subsection 6.1(xvii)); provided,
that, any asset sale described in clauses (ii) or (iii) shall not be
deemed to be an Asset Sale unless the value of the assets sold exceeds
$5,000,000.  Solely for purposes of
subsection 6.7(v), the issuance of Capital Stock by Company or any of its
Domestic Subsidiaries (other than by Domestic Borrowers or with respect to
employee and executive compensation plans and issuances to qualifying directors
and Company or any of its Subsidiaries) shall be deemed an Asset Sale (except
to the extent such issuance, if deemed a disposition or transfer, would not
constitute an Asset Sale under clause (1) above) with the proceeds of any such
issuance being deemed Net Equity Securities Proceeds.


 


“Assignment and Acceptance” means an Assignment and
Acceptance, in substantially the form of Exhibit X annexed hereto.


 


“Australian Cross Guaranty” means the guaranty by the
Australian Offshore Borrowers and the Australian Wholly-Owned Subsidiaries of
the French Tranche C1 Term Loans and French Tranche C2 Term Loans.


 


“Australian Offshore Borrowers” means O-I Australia, ACI and
any Australian Subsidiary that becomes an Additional Offshore Borrower to which
Australian Revolving Loans will
be made under this Agreement.


 


“Australian Overdraft Account” means an account established
by any Australian Offshore Borrower with Australian Overdraft Account Provider
and referenced in an Australian Overdraft Agreement.


 


10





















 


“Australian Overdraft Account Provider” means Westpac Banking
Corporation or any successor Australian Overdraft Account Provider pursuant to
subsection 10.2E; provided, however, that no such Lender
shall be a successor Australian Overdraft Account Provider until any Australian
Offshore Borrower and such Lender have executed and delivered an Australian
Overdraft Agreement to Administrative Agent.


 


“Australian Overdraft Agreement” means that certain agreement
between ACI and Westpac Banking Corporation, dated as of August 18, 2003, and
any Offshore Overdraft Agreement between an Australian Offshore Borrower and
any successor Australian Overdraft Account Provider, in substantially the form
of Exhibit VIII annexed hereto, with such modifications thereto as
may be approved by Administrative Agent and any successor Offshore Overdraft
Agreement executed and delivered by such Australian Offshore Borrower and such
successor Australian Overdraft Account Provider pursuant to subsection 10.2E,
as any such Offshore Overdraft Agreement may hereafter be amended, amended and
restated, supplemented or otherwise modified from time to time in accordance
with the terms thereof and hereof.


 


“Australian Overdraft Amount” means, as at any date of
determination, the aggregate principal amount of outstanding overdrafts charged
to all Australian Overdraft Accounts.


 


“Australian Revolving Loan
Commitment” means the
commitment of a Lender to make Australian
Revolving Loans to Australian Offshore Borrowers pursuant to subsection 2.1C,
and “Australian Revolving Loan Commitments” means such commitments of all Lenders in
the aggregate.


 


“Australian Revolving Loan
Exposure” means, with respect to any Lender as of any date of
determination (i) prior to the termination of the Revolving Loan
Commitments, that Lender’s Australian Revolving
Loan Commitment, and (ii) after the termination of the Revolving Loan
Commitments, the sum of (a) the aggregate outstanding principal amount of the
Australian Revolving Loans of
that Lender plus (b) in the event that Lender is an Issuing Lender in
respect of a Letter of Credit issued for the account of an Australian Offshore
Borrower, the aggregate Letter of Credit Usage in respect of all Letters of
Credit issued by that Lender for the account of an Australian Offshore Borrower
(in each case net of any participation purchased by other Lenders in such
Letters of Credit or any unreimbursed drawings thereunder) plus (c) the
aggregate amount of all participations purchased by that Lender in any
outstanding Letters of Credit issued for the account of an Australian Offshore
Borrower or any unreimbursed drawings under any Letters of Credit issued for
the account of any Australian Offshore Borrower plus (d) in the
case of Australian Overdraft Account Provider, the Dollar Equivalent of the
Australian Overdraft Amount (net of any participations therein purchased by
other Lenders) plus (e) the aggregate amount of all participations
purchased by that Lender in the Australian Overdraft Amount.


 


“Australian Revolving Loan Note” means any promissory
note of an Australian Offshore Borrower, substantially in the form of Exhibit
VI annexed hereto, issued in favor of a Lender pursuant to subsection 2.1G(iv)
to evidence the Australian Revolving
Loans of such Lender, as such promissory note may be amended, supplemented or
otherwise modified from time to time.


 


11





















 


“Australian Revolving Loans” means any existing Australian
Revolving Loans outstanding under the Second Amended and Restated Credit
Agreement on the Third Restatement Date and amended and restated as Australian
Revolving Loans hereunder and Loans made from and after the Third Restatement
Date by Lenders to Australian Offshore Borrowers pursuant to subsection 2.1C.


 


“Australian Subsidiary” means any Subsidiary of Company
organized under the laws of the Commonwealth of Australia or any state or
territory thereof.


 


“Australian Wholly-Owned
Subsidiary”  means any
Wholly-Owned Subsidiary of any Australian Offshore Borrower organized under the
laws of the Commonwealth of Australia or any state or territory thereof and “Australian Wholly-Owned Subsidiaries” means, collectively, all Australian
Wholly-Owned Subsidiaries.


 


“Avir” means Aziende Vetrarie Industriali
Ricciardi — AVIR S.p.A., a corporation
organized under the laws of Italy.


 


“Bankruptcy Code” means Title 11 of the United States Code
entitled “Bankruptcy” as now and hereafter in effect, or any successor statute.


 


“Base Rate” means, at any time, the higher of (x) the
Prime Rate or (y) the rate which is 1/2 of 1% in excess of the Federal
Funds Effective Rate.


 


“Base Rate Loans” means Loans bearing interest at rates
determined by reference to the Base Rate as provided in subsection 2.2A.


 


“Borrower” means (i) with respect to the Tranche B1 Term
Loans, Owens-Brockway, (ii) with respect to Revolving Loans and Letters of
Credit issued for the account of a Domestic Borrower and the Domestic Overdraft
Account, either of the Domestic Borrowers, (iii) with respect to UK
Revolving Loans and the UK Overdraft Account, United Glass, (iv) with
respect to Tranche A1 Term Loans, ACI, (v) with respect to the Australian
Revolving Loans, Letters of Credit issued for the account of  an Australian Offshore Borrower and the
Australian Overdraft Account, any of the Australian Offshore Borrowers, as
applicable, (vi) with respect to Canadian Revolving Loans and the Canadian
Overdraft Account, O-I Canada, (vii) with respect to Italian Revolving Loans
and the Italian Overdraft Account, Avir, and (viii) with respect to the French
Tranche C1 Term Loans and French Tranche C2 Term Loans, BSN, and “Borrowers” means any combination thereof, collectively.


 


“Borrowers’ Agent” means Owens-Illinois
General, Inc. pursuant to the appointment made by Borrowers in subsection 2.9E.


 


“Borrowing Subsidiary Agreement” means a Borrowing Subsidiary
Agreement, in substantially the form of Exhibit XVIII annexed
hereto.


 


“BSN” shall mean BSN Glasspack, S.A., a French societe
anonyme.


 


“BSN Acquisition” means OI Europe SAS’s acquisition of the
Capital Stock of BSN and the BSN Subordinated Shareholder Loan on the BSN
Acquisition Closing Date.


 


12





















 


“BSN Acquisition Closing Date” means June 21, 2004.


 


“BSN Intercreditor Agreements” means (i) the Intercreditor
Agreement dated June 21, 2004 by and among BSN Glaspack S.A., BSN Financing Co.
S.A., certain other subsidiaries of BSN Glasspack, S.A., O-I Europe SAS, and the
directors and nominees named therein, and Deutsche Bank Trust Company Americas,
as Senior Facility Agent, and Deutsche Bank AG London, as Senior Security
Agent, and The Bank of New York, as Noteholder Trustee for the holders of the
10 1⁄4% BSN Senior Subordinated Notes and (ii) 
the Intercreditor Agreement dated June 21, 2004 by and among BSN
Glasspack S.A., BSN Glasspack Treasury, S.A., BSN Glasspack Obligation S.A.,
certain other subsidiaries of BSN Glasspack, S.A., O-I Europe SAS, and the
directors and nominees named therein, and Deutsche Bank Trust Company Americas,
as Senior Facility Agent, and Deutsche Bank AG London, as Senior Security
Agent, and The Bank of New York, as New Noteholder Trustee for the holders of
the 9 1⁄4% BSN Senior Subordinated Notes, in each case as the same may be
amended, supplemented, modified or replaced from time to time.


 


“BSN Receivables Securitization Facility” means the
receivables securitization facility established pursuant to agreements among
BSN Glasspack Services, Credit Commercial de France (HSBC-CCF) and Gestion et
Titrisation Internationales on or about November 5, 2000.


 


“BSN Senior Subordinated Note Indentures” means (i) the
Indenture dated as of August 5, 1999 between BSN Financing Co. S.A., as Issuer
and The Bank of New York, as Trustee and (ii) the Indenture dated as of August
5, 2003 between BSN Glasspack Obligation S.A., as Issuer and The Bank of New
York, as Trustee, in each case as such Indenture may have been and may
hereafter be amended, supplemented or otherwise modified from time to time, and
“BSN Senior Subordinated Note Indenture”
means either such Indenture.


 


“BSN Senior Subordinated Notes” means, collectively (i) the 10 1⁄4% Senior
Subordinated Notes Due 2009 issued by BSN Financing Co. S.A. pursuant to its
BSN Senior Subordinated Note Indenture (the “10
1⁄4% BSN Senior Subordinated Notes”) and (ii) the 9 1⁄4% Senior
Subordinated Notes Due 2009, issued by BSN Glasspack Obligation pursuant to its
BSN Senior Subordinated Note Indenture (the “9
1⁄4% BSN Senior Subordinated Notes”).


 


“BSN Share Purchase Agreement” means the Share Purchase
Agreement by and among Holdings, O-I Europe and the prior owners of the Capital
Stock of BSN dated as of March 15, 2004.


 


“BSN Subordinated Shareholder Loan” means the loan in the
aggregate outstanding principal amount of €15,240,000 evidenced by the Loan
Agreement dated August 5, 1999 between BSN and Glasspack Participations, S.A.


 


“Business Day” means (i) for all purposes other than as
covered by clause (ii) or (iii) below, any day excluding Saturday, Sunday and
any day which is a legal holiday under the laws of the States of New York or
Ohio or is a day on which banking institutions located in such states are
authorized or required by law or other governmental action to close, (ii) with
respect to all notices, determinations, fundings and payments in connection
with the Adjusted Eurodollar


 


13





















 


Rate,
any day which is a Business Day described in clause (i) and which is also a day
for trading by and between banks in Dollar deposits in the European interbank
market, (iii) with respect to all notices, determinations, fundings and
payments in connection with Euro LIBOR, any day which is a Business Day
described in clause (i) and which is also a day for trading by and between
banks in Euro deposits in the applicable interbank Euro LIBOR market, and (iv)
with respect to all notices, determinations, fundings and payments in
connection with any Offshore Revolving Loans, any Offshore Overdraft Account,
or any Letter of Credit issued for the account of an Offshore Borrower, any day
which is a Business Day described in clause (i) and (ii) above and which is
also an Offshore Banking Day.


 


“Calculation Date” means (i) the last day of each calendar month
(or, if such day is not a Business Day, the next preceding Business Day), (ii)
at any time after and so long as (a) the Total Utilization of UK Revolving
Loan Commitments or the Total Utilization of Australian Revolving Loan
Commitments or the Total Utilization of Italian Revolving Loan Commitments or
the Total Utilization of Canadian Revolving Loan Commitments exceeds 90% of the
Offshore Sublimit for the applicable Offshore Borrower or (b) the sum of such
amounts exceeds 90% of the Aggregate Offshore Sublimit, the fifteenth and last
day of each calendar month (or, if such day is not a Business Day, the next
preceding Business Day), (iii) the CAM Exchange Date, and (iv) such other dates
as Administrative Agent or any Borrower may reasonably require from time to
time, including any date on which Offshore Revolving Loans  are made to repay, or participations are
purchased in, any Offshore Overdraft Amount under Section 2.1D, any date of
calculation of Dollar Equivalents described in the last sentence of subsection
2.4B(iii), any date on which a Borrower reimburses an Issuing Lender or
Revolving Loans are made to reimburse an Issuing Lender in Dollars for a draw
on a Letter of Credit denominated in a currency other than Dollars under
Section 2.8D and any date on which participations are purchased in Dollars in
an unreimbursed draw on a Letter of Credit denominated in a currency other than
Dollars under Section 2.8E.


 


“CAM” means the mechanism for the allocation
and exchange of interests in the Specified Obligations and collections
thereunder established under subsection 2.10.


 


“CAM Exchange” means the exchange of the
Lenders’ interests provided for in subsection 2.10.


 


“CAM Exchange Date” means the date on which
(a) any Event of Default  referred to in
subsection 7.6 or 7.7 shall occur in respect of the Company, either
Domestic Borrower, any Australian Offshore Borrower or BSN or (b) an
acceleration of the maturity of any of the Loans pursuant to Section 7 shall
occur.


 


“CAM Percentage” means, as to each Lender, a
fraction, expressed as a decimal, of which (a) the numerator shall be the
aggregate Dollar Equivalent (determined on the basis of Spot Rates prevailing
on the CAM Exchange Date) of the Specified Obligations owed to such Lender and
such Lender’s participation in the Domestic Overdraft Amount, the Offshore
Overdraft Amounts and undrawn amounts of Letters of Credit immediately prior to
the CAM Exchange Date and (b) the denominator shall be aggregate Dollar
Equivalent (as so determined) of the Specified Obligations owed to all the
Lenders, the Domestic Overdraft Amount, the


 


14





















 


Offshore
Overdraft Amounts and the aggregate undrawn amount of outstanding Letters of
Credit immediately prior to such CAM Exchange Date.


 


“Canadian Dollars” means the lawful currency of Canada.


 


“Canadian Overdraft Account” means the account established by
O-I Canada  with Canadian Overdraft
Account Provider and referenced in the Canadian Overdraft Agreement.


 


“Canadian Overdraft Account Provider” means the Bank of Nova
Scotia or any successor Canadian Overdraft Account Provider pursuant to
subsection 10.2E; provided, however, that no such Lender
shall be a successor Canadian Overdraft Account Provider until O-I Canada and
such Lender have executed and delivered an Canadian Overdraft Agreement to
Administrative Agent.


 


“Canadian Overdraft Agreement” means that certain agreement
between O-I Canada and the Bank of Nova Scotia dated as of July 28, 2003,
and/or any Offshore Overdraft Agreement between O-I Canada and any successor
Canadian Overdraft Account Provider, in substantially the form of Exhibit VIII
annexed hereto, with such modifications thereto as may be approved by
Administrative Agent and any successor Offshore Overdraft Agreement executed
and delivered by O-I Canada and such successor Canadian Overdraft Account
Provider pursuant to subsection 10.2E, as any such Offshore Overdraft
Agreement may hereafter be amended, amended and restated, supplemented or
otherwise modified from time to time.


 


“Canadian Overdraft Amount” means, as at any date of
determination, the aggregate principal amount of outstanding overdrafts charged
to the Canadian Overdraft Account.


 


“Canadian Revolving Loan
Commitment” means the commitment of a Lender to make Canadian
Revolving Loans to O-I Canada pursuant to subsection 2.1C, and “Canadian Revolving Loan Commitments” means such commitments
of all Lenders in the aggregate.


 


“Canadian Revolving Loan
Exposure” means, with respect to any Lender as of any date of determination
(i) prior to the termination of the Revolving Loan Commitments, that
Lender’s Canadian Revolving Loan Commitment, and (ii) after the
termination of the Revolving Loan Commitments, the sum of (a) the aggregate
outstanding principal amount of the Canadian Revolving Loans of that Lender plus
(b) in the case of Canadian Overdraft Account Provider, the Dollar Equivalent
of the Canadian Overdraft Amount (net of any participations therein purchased
by other Lenders) plus (c) the aggregate amount of all participations
purchased by that Lender in the Canadian Overdraft Amount.


 


“Canadian Revolving Loan Note” means any promissory note of
O-I Canada, substantially in the form of Exhibit VI annexed hereto,
issued in favor of a Lender pursuant to subsection 2.1G(iv) to evidence
the Canadian Revolving Loans of such Lender, as such promissory note may be
amended, supplemented or otherwise modified from time to time.


 


“Canadian Revolving Loans” means the Loans made by Lenders to
O-I Canada pursuant to subsection 2.1C.


 


15





















 


“Capital Lease”, as applied to any Person, means any lease of
any property (whether real, personal or mixed) by that Person as lessee which,
in conformity with GAAP (subject to subsection 1.2 hereof), is accounted
for as a capital lease on the balance sheet of that Person.


 


“Capital Stock” means the capital stock or
other equity interests of a Person.


 


“Cash” means money, currency or a credit balance in a Deposit
Account.


 


“Cash Equivalents” means (i) marketable direct
obligations issued or unconditionally guarantied by the United States
Government or issued by any agency thereof and (a) backed by the full
faith and credit of the United States of America or (b) having a rating of at
least AAA from S&P or at least Aaa from Moody’s, in each case maturing
within one year from the date of acquisition thereof; (ii) marketable
direct obligations issued by any state of the United States of America or any
political subdivision of any such state or any public instrumentality thereof
maturing within one year from the date of acquisition thereof and, at the time
of acquisition, having the highest rating obtainable from either S&P or
Moody’s; (iii) commercial paper maturing no more than one year from the
date of creation thereof and, at the time of acquisition, having a rating of at
least A-1 from S&P or at least P-1 from Moody’s; (iv) certificates of
deposit or bankers’ acceptances maturing within one year from the date of
acquisition thereof issued by any Lender or any commercial bank organized under
the laws of the United States of America or any state thereof or the District
of Columbia having combined capital and surplus of not less than $250,000,000;
(v) Eurodollar time deposits having a maturity of less than one year
purchased directly from any Lender or any Affiliate of any Lender (whether such
deposit is with such Lender or Affiliate or any other Lender);
(vi) repurchase agreements and reverse repurchase agreements with any
Lender or any Affiliate of any Lender relating to marketable direct obligations
issued or unconditionally guarantied by the United States Government or issued
by any agency thereof and backed by the full faith and credit of the United
States of America, in each case maturing within one year from the date of
acquisition thereof; and (vii) shares of any money market mutual fund that has
a rating of at least AAAm from S&P or at least Aaa from Moody’s.


 


“Change of Control” means such time as a “person” or “group”
(within the meaning of Sections 13(d) and 14(d)(2) of the Exchange Act),
other than KKR and its Affiliates, becomes the “beneficial owner” (as defined
in Rule 13d-3 under the Exchange Act) of more than 35% of the total voting
power of the then outstanding Voting Stock or any event constituting a “change
of control” under any indenture governing any Existing Owens-Brockway Senior
Secured Notes, Existing Owens-Brockway Senior Unsecured Notes, New Senior Debt,
Refinancing Senior Debt or New Junior Debt. 
For purposes of this definition of “Change of Control”, the term “Voting Stock” means Capital Stock of any class or kind
ordinarily (without regard to the occurrence of any contingency) having the
power to vote for the election of directors of Holdings or Company.


 


“Class”,
as applied to the Lenders, means each of the following five classes of
Lenders:  (i) Revolving Lenders, (ii)
Lenders having Tranche A1 Term Loan Exposure, (iii) Lenders having Tranche B1
Term Loan Exposure, (iv) Lenders having French Tranche C1 Term Loan Exposure, and
(v) Lenders having French Tranche C2 Term Loan Exposure; provided, that


 


16





















 


the French Tranche C1 Term Loans and the French Tranche C2 Term Loans
shall be deemed to be a single class except with respect to any amendment,
modification, termination or waiver that would disproportionately disadvantage
any such Type of Loans relative to the other.


 


“Collateral” means, collectively, all of the
real, personal and mixed property (including Capital Stock) in which Liens are
purported to be granted pursuant to the Collateral Documents.


 


“Collateral Agent” means DB acting in the capacity of
collateral agent on behalf of the Lenders, the trustees in respect of any
outstanding Existing Holdings Senior Notes, the trustees in respect of the
Existing Owens-Brockway Senior Secured Notes and the holders of Other Permitted
Credit Exposure and the other persons (other than Company or its Subsidiaries)
who in each case have executed acknowledgements to the Intercreditor Agreement
acknowledged (to the extent necessary) by Borrowers’ Agent or are otherwise
entitled to the benefit thereof, including Lenders and their Affiliates party
to Interest Rate Agreements and Currency Agreements, in each case under the
Collateral Documents, and with respect to the Offshore Collateral Documents
governed by the BSN Intercreditor Agreements, on behalf of the Lenders and the
trustees in respect of the BSN Senior Subordinated Notes.  The Collateral Agent has designated Deutsche
Bank AG, Sydney Branch, as a sub-agent to act on its behalf in Australia,
Deutsche Bank AG London as a sub-agent to act on its behalf in the UK, France,
the Netherlands, Spain, Germany, and Luxembourg, and may from time to time
designate other sub-agents to act on behalf of Collateral Agent with respect to
the Offshore Collateral.  The term “Collateral
Agent” shall be deemed to include such sub-agents where appropriate.


 


“Collateral Documents” means the Domestic
Collateral Documents and the Offshore Collateral Documents, collectively.


 


“Commercial Letter of Credit” means any letter of credit or
similar instrument issued for the purpose of providing the primary payment
mechanism in connection with the purchase of any materials, goods or services
by Borrowers or any of their Subsidiaries in the ordinary course of business of
such Borrower or such Subsidiary.


 


“Commitments”
means the Revolving Loan Commitments, the UK Revolving Loan Commitments, the
Australian Revolving Loan Commitments, the Canadian Revolving Loan Commitments,
the Italian Revolving Loan Commitments or any combination thereof.


 


“Commodities Agreement” means any forward commodities
contract, commodities option contract, commodities futures contract,
commodities futures option, or similar agreement or arrangement.


 


“Common Stock” means the common stock of a Person.


 


“Company” has the meaning assigned to that term in the
introduction to this Agreement.


 


“Company Guaranty” means the guaranty by Company contained in
Section 9 hereof.


 


17





















 


“Compliance Certificate” means a certificate substantially in
the form annexed hereto as Exhibit IX delivered to Lenders by
Company pursuant to subsection 5.1(iii).


 


“Consolidated Adjusted EBITDA” means, for any period, the
remainder of  Consolidated Net Income adjusted to exclude (without
duplication) the effects of (i) Consolidated Interest Expense, (ii)
provisions for taxes based on income, (iii) depreciation expense, (iv)
amortization expense, (v) extraordinary items, (vi) material non-recurring
gains and non-cash charges (excluding, for all purposes other than the
calculation of Consolidated Excess Cash Flow, any such charges related to
claims of persons against Holdings for exposure to asbestos-containing products
and expenses related thereto), (vii) the establishment of the 2003 Additional
Asbestos Reserve, (viii) material non-recurring cash charges (other than
any cash charge against any accrual or reserve established in a prior period
for which an adjustment was taken under clause (vi) of this definition and
other than any charges related to claims of persons against Holdings for
exposure to asbestos-containing products and expenses related thereto) in an
amount not to exceed $10,000,000 for any such charge individually or
$20,000,000 in the aggregate for all such charges in any four Fiscal Quarter
Period; and (ix) minority share owners’ interests in earnings of
subsidiaries, all of the foregoing as determined on a consolidated basis for
Holdings and its Subsidiaries in conformity with GAAP; provided  that
(i) Consolidated Adjusted EBITDA for the Fiscal Quarters ended December 31,
2003, March 31, 2004 and June 30, 2004 shall be deemed to be $329,343,922,
$383,998,956 and $422,642,652, respectively (in each case, subject to
adjustment on a Pro Forma Basis to reflect the Plastics Sale from and after the
consummation thereof) and (ii) Consolidated Net Income shall also be adjusted
to exclude (x) for the Fiscal Year ending December 31, 2004, an increase in the
Asbestos Reserve in an amount not to exceed $118,000,000, (xi) in each Fiscal
Year thereafter, increase in the Asbestos Reserve in an amount not to exceed
90% of the lesser of (A) the maximum amount permitted to be excluded in the
previous Fiscal Year or (B) the amount by which the Asbestos Reserve was actually
increased in such previous Fiscal Year as confirmed by Holdings’ form 10-K
filing for such Fiscal Year and (xii) restructuring charges (other than any
cash charge against any accrual or reserve in a prior period for which
adjustment was taken under this clause (xii)) taken on or prior to December 31,
2006 with respect to the BSN Acquisition in an aggregate amount for all periods
not to exceed €42,200,000.


 


“Consolidated Capital
Expenditures” means,
for any period, the sum of the aggregate of all expenditures (whether paid in
cash or other consideration or accrued as a liability and including that
portion of Capital Leases which is capitalized on the consolidated balance
sheet of Holdings and its Subsidiaries) by Holdings and its Subsidiaries during
that period that, in conformity with GAAP, are included in “additions to
property, plant or equipment” or comparable items reflected in the consolidated
statement of cash flows of Holdings and its Subsidiaries.  For purposes of this definition, the purchase
price of equipment that is purchased simultaneously with the trade-in of
existing equipment or with insurance proceeds shall be included in Consolidated
Capital Expenditures only to the extent of the gross amount of such purchase
price less the credit granted by the seller of such equipment for the equipment
being traded in at such time or the amount of such proceeds, as the case may
be.


 


“Consolidated Cash Flow
Available for Fixed Charges”
means, for any period, the result for such period of (i) Consolidated Adjusted
EBITDA less (ii) Consolidated Capital Expenditures and  less
(iii) cash taxes paid based on income (including Restricted Junior 


 


18





















 


Payments permitted by
subsection 6.5 and described in clause (y) of the definition of Holdings
Ordinary Course Payments).


 


“Consolidated Cash Interest Expense” means, for any period,
Consolidated Interest Expense for such period excluding, however,
any interest expense not payable in Cash (including amortization of discount
and amortization of debt issuance costs).


 


“Consolidated Excess Cash Flow” means, for any period, an
amount (if positive) equal to (i) the sum, without duplication, of the
amounts for such period of (a) Consolidated Adjusted EBITDA and
(b) the Consolidated Working Capital Adjustment minus (ii) the
sum, without duplication, of the amounts for such period of (a) all repayments
of Consolidated Total Debt permitted hereunder (excluding (i) repayments of
Revolving Loans except to the extent the Revolving Loan Commitments are
permanently reduced in connection with such repayments, (ii) repayments of
Indebtedness with proceeds of other Indebtedness (including, without
limitation, Revolving Loans or amounts drawn out of any Existing Holdings Senior
Notes Redemption Collateral Account, (iii) any other mandatory prepayment of
Indebtedness, to the extent proceeds from the event giving rise to such
prepayment are not included in the calculation of Consolidated Adjusted EBITDA
and (iv) any repayments, repurchases or redemptions of Existing Holdings Senior
Notes maturing in 2005 made on or prior to December 31, 2004),
(b) Consolidated Capital Expenditures (net of any proceeds of any related
financings with respect to such expenditures), (c) Consolidated Cash Interest
Expense, (d) the provision for current taxes based on income of Company
and its Subsidiaries and payable in cash with respect to such period, (e) the
amount of cash charges for such period for which adjustment was made under
clause (viii) of the definition of Consolidated Adjusted EBITDA, (f) the amount
of Holdings Ordinary Course Payments made pursuant to clause (w) of the
definition thereof for such period and (g) the amount of Holdings Ordinary
Course Payments made pursuant to clause (x) of the definition thereof for such
period.


 


“Consolidated Fixed Charge
Coverage Ratio”
means, as at any date of determination, the ratio of (a) Consolidated Cash Flow
Available for Fixed Charges for the four-Fiscal Quarter period ended on such
date to (b) Consolidated Fixed Charges for such four Fiscal Quarter period.


 


“Consolidated Fixed Charges” means, for any period, the sum
(without duplication) of the amounts for such period of (i) Consolidated
Interest Expense and (ii) Restricted Junior Payments permitted by subsection 6.5
and described in clauses (t) and (x) of the definition of Holdings Ordinary
Course Payments, all of the foregoing as determined on a consolidated basis for
Holdings and its Subsidiaries in conformity with GAAP.


 


“Consolidated Interest Expense” means, for any period,
interest expense with respect to all outstanding Indebtedness (including,
without limitation, net costs under Interest Rate Agreements and any such
expense attributable to Capital Leases in accordance with GAAP) of Holdings and
its Subsidiaries for such period determined on a consolidated basis in
conformity with GAAP.


 


19





















 


“Consolidated Leverage Ratio” means, as at
any date of determination, the ratio of (a) Consolidated Total Debt as of the
last day of the Fiscal Quarter ended on such date to (b) Consolidated Adjusted
EBITDA for the four Fiscal Quarter period ended on such date.


 


“Consolidated Net Income” means, for any period, the net
income (or loss) of Holdings and its Subsidiaries on a consolidated basis for
such period taken as a single accounting period determined in conformity with
GAAP.


 


“Consolidated Senior Secured Debt” means (A)
Consolidated Total Debt plus the aggregate amount that is or may become
available for drawing under any Letters of Credit minus (B) Existing
Holdings Senior Notes, Subordinated Indebtedness of Holdings and its
Subsidiaries (including, for avoidance of doubt, the BSN Senior Subordinated
Notes), Refinancing Senior Debt, New Junior Debt, the Existing Owens-Brockway
Senior Unsecured Notes and any other unsecured and/or subordinated Indebtedness
of Holdings and its Subsidiaries permitted by this Agreement, determined on a
consolidated basis in conformity with GAAP.


 


“Consolidated Senior Secured Leverage Ratio”
means, as of any date of determination, the ratio, calculated on a Pro Forma
Basis, of (a) Consolidated Senior Secured Debt as of the date of
determination to (b) Consolidated Adjusted EBITDA for the four Fiscal
Quarter period most recently ended on or prior to such date.


 


“Consolidated Total Debt” means, as at any date of
determination, the aggregate stated balance sheet amount of all Indebtedness of
Holdings and its Subsidiaries, all as determined on a consolidated basis in
conformity with GAAP and Receivables Sale Indebtedness of Holdings and its
Subsidiaries regardless of whether included on the consolidated balance sheet
of Holdings and its Subsidiaries; provided, that, for purposes of calculating
the Consolidated Leverage Ratio, “Consolidated Total Debt” shall not include
Existing Holdings Senior Notes maturing in 2005 or 2007 or the BSN Senior
Subordinated Notes to the extent funds are escrowed for the payment thereof in
the Existing Holdings Senior Notes Redemption Collateral Account or the BSN Senior
Subordinated Notes Redemption Collateral Account, as applicable.


 


“Consolidated Working
Capital Adjustment”
means, for any period on a consolidated basis, the amount (which may be
negative) by which the sum of the components of working capital as of the
beginning of such period exceeds (or is less than) the sum of the components of
working capital as of the end of such period, as presented on the face of the
consolidated cash flow statement included in Holdings’ Form 10-K filing for
such period.


 


“Contingent Obligation” means, as applied to
any Person, any direct or indirect liability, contingent or otherwise, of that
Person (i) with respect to any Indebtedness, lease, dividend or other
obligation of another if the primary purpose or intent thereof by the Person
incurring the Contingent Obligation is to provide assurance to the obligee of
such obligation of another that such obligation of another will be paid or
discharged, or that any agreements relating thereto will be complied with, or
that the holders of such obligation will be protected (in whole or in part)
against loss in respect thereof, (ii) with respect to any letter of credit
issued for the account of that Person or as to which that Person is otherwise
liable for reimbursement of drawings, or (iii) under Hedge Agreements.  Contingent Obligations shall include (a) the
direct 


 


20





















 


or indirect guaranty,
endorsement (otherwise than for collection or deposit in the ordinary course of
business), co-making, discounting with recourse or sale with recourse by such
Person of the obligation of another, (b) the obligation to make take-or-pay or
similar payments if required regardless of non-performance by any other party
or parties to an agreement, and (c) any liability of such Person for the
obligation of another through any agreement (contingent or otherwise) (1) to
purchase, repurchase or otherwise acquire such obligation or any security
therefor, or to provide funds for the payment or discharge of such obligation
(whether in the form of loans, advances, stock purchases, capital contributions
or otherwise) or (2) to maintain the solvency or any balance sheet item, level
of income or financial condition of another if, in the case of any agreement
described under subclauses (1) or (2) of this sentence, the primary purpose or
intent thereof is as described in the preceding sentence.  The amount of any Contingent Obligation shall
be equal to the principal amount of the obligation so guaranteed or otherwise
supported or, if less, the amount to which such Contingent Obligation is
specifically limited, or, if not stated, the maximum reasonably anticipated
liability in respect thereof as determined by such Person in good faith.


 


“Contractual Obligation”, as applied to any Person, means any
provision of any Security issued by that Person or of any material indenture,
mortgage, deed of trust, contract, undertaking, agreement or other instrument
to which that Person is a party or by which it or any of its properties is bound
or to which it or any of its properties is subject.


 


“Covered Tax” means any Tax that is not an Excluded Tax.


 


“Currency Agreement” means any foreign exchange contract,
currency swap agreement or other similar agreement or arrangement.


 


“Currency Obligations” has the meaning
assigned to that term in subsection 9.1.


 


“December 2003
Amendment” means the First Amendment to the First Amended and
Restated Secured Credit Agreement dated as of December 4, 2003.


 


“December 2003
Amendment Effective Date” means December 4, 2003, the date upon
which the December 2003 Amendment became effective.


 


“Defaulting Participating
Lender” means, (A)
with respect to any Letter of Credit, any Lender which (i) has Revolving Loan
Exposure at the time a notice is given to Lenders to fund the purchase of
participations in such Letter of Credit pursuant to subsection 2.8E, and
(ii) fails to fully fund such purchase pursuant to subsection 2.8E; or (B)
with respect to the Domestic Overdraft Account or any Offshore Overdraft
Account, any Lender which (i) has Revolving Loan Exposure at the time a notice
is given to Lenders to fund the purchase of participations in either the
Domestic Overdraft Account pursuant to subsection 2.1B or an Offshore
Overdraft Account pursuant to subsection 2.1D(ii), and (ii) fails to fully
fund such purchase pursuant to subsection 2.1B or 2.1D(ii).


 


“Deposit Account” means a demand, time, savings, passbook or
similar account maintained with a Person engaged in the business of banking,
including a savings bank, savings and loan association, credit union or trust
company.


 


21





















 


“Dollar Equivalent” means, at any time as to any amount
denominated in an Offshore Currency or, in the case of the amount of a Letter
of Credit, other non-Dollar currency, the equivalent amount in Dollars as
determined by the Administrative Agent at such time on the basis of the Spot
Rate for the purchase of Dollars with such Offshore Currency or other
non-Dollar currency on the most recent Calculation Date with respect to such
currency.


 


“Dollars” or the sign “$” means the
lawful currency of the United States of America.


 


“Domestic Borrowers” means, collectively,
Owens-Brockway and O-I Plastic.  “Domestic Borrower” means either of the
Domestic Borrowers.


 


“Domestic Borrowers’ Guaranty” means that
certain Amended and Restated Domestic Borrowers’ Guaranty dated as of June 13,
2003, as amended by the first amendment thereto dated as of the Second
Restatement Date, and as further amended by the second amendment thereto dated
as of the Third Restatement Date in the form attached hereto as Exhibit XIV,
pursuant to which (i) each Domestic Borrower shall continue to guarantee all
Tranche B1 Term Loans and Revolving Loans made to, and related Obligations of,
the other Domestic Borrower; (ii) each Domestic Borrower shall continue to
guarantee all Tranche A1 Term Loans, French Tranche C1 Term Loans, French
Tranche C2 Term Loans and Offshore Revolving Loans made to, and all other
Obligations of, the Offshore Borrowers; and (iii) each Domestic Borrower shall
continue to guarantee the Other Lender Guarantied Obligations.


 


“Domestic Collateral Documents” means the
Pledge Agreement, the Security Agreement and the Mortgages securing Mortgaged
Property located in the United States of America.


 


“Domestic Funding and Payment Office” means the office of
Administrative Agent located at 31 West 52nd Street, New York, New York 10019.


 


“Domestic Funding Borrower” has the meaning
assigned to that term in subsection 2.9B.


 


“Domestic Overdraft Account” means the account established by
the Domestic Borrowers with Administrative Agent and referenced in the Domestic
Overdraft Agreement.


 


“Domestic Overdraft Agreement” means the Amended and Restated
Overdraft Agreement dated as of June 13, 2003, between the Domestic Borrowers
and Administrative Agent, as amended by the first amendment thereto dated as of
the Second Restatement Date and as further amended by the second amendment
thereto dated as of the Third Restatement Date, and any successor Overdraft
Agreement substantially in the form attached hereto as Exhibit VII with
such modifications as may be approved by Administrative Agent, executed and
delivered by the Domestic Borrowers and any successor Administrative Agent
pursuant to subsection 8.6, as any such Overdraft Agreement may hereafter
be amended, amended and restated, supplemented or otherwise modified from time
to time.


 


22





















 


“Domestic Overdraft Amount” means, as at any date of determination,
the aggregate principal amount of outstanding overdrafts charged to the
Domestic Overdraft Account.


 


“Domestic Subsidiaries” means all Subsidiaries of Company
other than (A) the Foreign Subsidiaries and (B) Subsidiaries organized
under the laws of a state of the United States of America but owned, directly
or indirectly, in whole or in part as of the date hereof by a Foreign
Subsidiary other than ACI America Holdings, Inc.


 


“Eligible Assignee” means (A)(i) a commercial bank
organized under the laws of the United States of America or any state thereof;
(ii) a savings and loan association or savings bank organized under the
laws of the United States of America or any state thereof; (iii) a
commercial bank organized under the laws of any other country or a political
subdivision thereof; provided that (x) such bank is acting through
a branch or agency located in the United States of America or (y) such
bank is organized under the laws of a country that is a member of the
Organization for Economic Cooperation and Development or a political
subdivision of such country; and (iv) any other entity which is an “accredited
investor” (as defined in Regulation D under the Securities Act) which extends
credit or buys or invests in loans as one of its businesses including, but not
limited to, insurance companies, mutual funds and lease financing companies, in
each case (under clauses (i) through (iv) above) that is reasonably acceptable
to Administrative Agent; and (B) any Lender, any Affiliate of any Lender
and Related Fund of any Lender; provided that (1) no Affiliate of
Company shall be an Eligible Assignee and (2) no “associate” (as defined in
Section 128F(9) of the Income Tax Assessment Act 1936 of Australia) of an
Australian Offshore Borrower shall be an Eligible Assignee with respect to an
Australian Revolving Loan Commitment or a Tranche A1 Term Loan; provided
further that, in order to be an Eligible Assignee with respect to a
Revolving Loan Commitment, Letters of Credit or a participation therein, a
Person must have at the time of determination unimpaired capital and surplus of
not less than $100,000,000.


 


“Employee Benefit Plan” means any “employee benefit plan” as
defined in Section 3(3) of ERISA which is or was maintained or contributed
to by Holdings, any of its Subsidiaries or any of their respective ERISA
Affiliates.


 


“English Wholly-Owned
Subsidiary” means any
Wholly-Owned Subsidiary of United Glass incorporated in England and Wales,
excluding, however, U.G. Leasing Ltd., and “English
Wholly-Owned Subsidiaries”
means, collectively, all English Wholly-Owned Subsidiaries.


 


“Environmental Claim” means any investigation, notice,
notice of violation, claim, action, suit, proceeding, demand, abatement order
or other order or directive (conditional or otherwise), by any Government
Authority or any other Person, arising (i) pursuant to or in connection with
any actual or alleged violation of any Environmental Law, (ii) in connection
with any Hazardous Materials or any actual or alleged Hazardous Materials Activity,
or (iii) in connection with any actual or alleged damage, injury, threat or
harm to health, safety, natural resources or the environment.


 


23





















 


“Environmental Laws” means any and all present and future laws,
statutes, ordinances, rules, regulations, requirements, restrictions, permits,
orders, codes of practice, approvals, controls and determinations of any
governmental authority that have the force and effect of law, and that pertain
to pollution (including hazardous or toxic substances), natural resources or
the environment, whether federal, state, or local, domestic or foreign,
including environmental response laws such as the Comprehensive Environmental
Response, Compensation and Liability Act of 1980, as amended by the Superfund
Amendments and Reauthorization Act of 1986 and as the same may be further
amended (collectively, “CERCLA”).


 


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


 


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


 


“ERISA Event” means any of the following events or
occurrences if such event or occurrence would, individually or in the
aggregate, reasonably be expected to have a Material Adverse Effect:  (i) the failure by Holdings, any of its
Subsidiaries or any ERISA Affiliate to make a required contribution to a Pension
Plan; (ii) a withdrawal by Holdings, any of its Subsidiaries 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 operation which is treated
as such a withdrawal under Section 4062(e) of ERISA; (iii) a complete or
partial withdrawal by Holdings, any of its Subsidiaries or any ERISA Affiliate
from a Multiemployer Plan or the receipt by Holdings, any of its Subsidiaries
or any ERISA Affiliate of notification that a Multiemployer Plan is in
reorganization or is insolvent pursuant to Section 4241 or 4245 of ERISA;
(iv) the filing of a notice of intent to terminate, the treatment of a Plan
amendment as a termination under Section 4041 or 4041A of ERISA, or the
commencement of proceedings by the PBGC to terminate, in each case with respect
to a Pension Plan or receipt by Holdings, any of its Subsidiaries or any ERISA
Affiliate of notice of any such event with respect to a Multiemployer Plan; (v)
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, to the knowledge of Holdings, any
Multiemployer Plan; (vi) the imposition of any liability upon Company, any of
its Subsidiaries or any ERISA Affiliate under Title IV of ERISA (other than
with respect to PBGC premiums due but not delinquent under Section 4007 of
ERISA) upon Company, any of its Subsidiaries or any ERISA Affiliate; (vii) the
imposition of a Lien pursuant to Section 401(a)(29) or 412(n) of the
Internal Revenue Code or pursuant to ERISA with respect to any Pension Plan;
(viii) receipt from the Internal Revenue Service of notice of the failure of
any Plan intended to qualify under Section 401(a) of the Internal Revenue
Code to qualify under Section 401(a) of the Internal Revenue Code, or the
failure of any trust forming part of any such Plan to qualify for exemption
from taxation under Section 501(a) of the Internal Revenue Code; or (ix)
the violation of any applicable foreign law, or an event or occurrence that is
comparable to any of the foregoing 


 


24





















 


events or occurrences, in
either case with respect to a Plan that is not subject to regulation under
ERISA by reason of Section 4(b)(4) of ERISA.


 


“Euro” and the sign “€” mean the
single currency unit of Participating Member States.


 


“Euro LIBOR” shall mean, with respect to French Tranche C2
Term Loans, (i) the rate per annum for deposits in Euros as determined by the
Administrative Agent for a period corresponding to the duration of the rele­vant
Interest Period which appears on Reuters Page EURIBOR-01 (or any successor
page) at approx­imately 11:00 A.M. (Brussels time) on the date which is two
Business Days prior to the commence­ment of such Interest Period or (ii) if
such rate is not shown on Reuters Page EURIBOR-01 (or any successor page), the
average offered quotation to prime banks in the Euro-zone interbank market by
the Administrative Agent for Euro deposits of amounts compar­able to the
principal amount of the French Tranche C2 Term Loans to be made by the
Administrative Agent as part of such borrowing with maturities comparable to
the Interest Period to be applicable to such Loan (rounded upward to the next
whole multiple of 1/100 of 1%), determined as of 11:00 A.M. (Brussels time) on
the date which is two Business Days prior to the commencement of such Interest
Period.


 


“Euro LIBOR Loans” means Loans bearing interest at rates
determined by reference to Euro LIBOR as provided in subsection 2.2A.


 


“Euro Rate Loans” means the Eurodollar Rate Loans and Euro
LIBOR Loans, collectively.


 


“Eurodollar Rate Loans” means Loans bearing interest at rates
determined by reference to the Adjusted Eurodollar Rate as provided in
subsection 2.2A.


 


“Event of Default” means each of the events set forth in
Section 7.


 


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


 


“Excluded Tax” means any of the following Taxes and all
liabilities (including without limitation all penalties, interest and other
additions to tax) with respect thereto: 
(i) Taxes imposed on the net income or capital of a Lender,
Arranger, Agent or Tax Transferee and franchise taxes imposed in lieu thereof
(including without limitation branch profits taxes, minimum taxes and taxes
computed under alternative methods, at least one of which is based on net
income (collectively referred to as “net income taxes”)) by (A) the
jurisdiction under the laws of which such Lender, Arranger, Agent or Tax
Transferee is organized or resident for tax purposes or any political
subdivision thereof or (B) the jurisdiction of such Lender’s, Tax
Transferee’s, Arranger’s or Agent’s applicable lending office or any political
subdivision thereof or (C) any jurisdiction with which the Lender, Arranger,
Agent or Tax Transferee has any present or former connection (other than solely
by virtue of being a Lender under this Agreement), (ii) any Taxes (other than
Taxes imposed, levied, collected, withheld or assessed by or within the United
Kingdom, Australia, Italy, Canada, France or any political subdivision thereof)
to the extent that they are in effect and would apply to a payment to such
Lender, Arranger or Agent, as applicable, as of the Second Restatement Date, or
as of the date such 


 


25





















 


Person becomes a Lender, in the
case of any assignee pursuant to subsection 10.2 or as of the date of a
change in the jurisdiction of the Lender’s applicable lending office, (iii) any
Taxes (other than taxes imposed, levied, collected, withheld or assessed by or
within the United Kingdom, Australia, Italy, Canada, France or any political
subdivision thereof) that are in effect and would apply to a payment to a Tax
Transferee as of the date of acquisition of any Loans by such Tax Transferee or
the date of the change of lending office of such Tax Transferee, as the case
may be (provided, however, that a Person shall not be considered
a Tax Transferee for purposes of this clause (iii) as a result of a change of
its lending office or the taking of any other steps pursuant to
subsection 2.6J or as a result of a CAM Exchange pursuant to subsection
2.10), (iv) with respect to any Taxes for which any credit or other Tax
benefit, in the reasonable good faith judgment of such Lender, Tax Transferee,
Arranger or Agent, as the case may be, is available to such Lender, Tax
Transferee, Arranger or Agent, as applicable, as a result thereof and is
allocable to the transactions contemplated by this Agreement, the amount of
such credit or other Tax benefit or (v) any Taxes that would not have been
imposed but for (A) the failure or unreasonable delay by such Agent, Arranger,
Lender or Tax Transferee, as applicable, to complete, provide, or file and, at
the request of a Borrower or Borrower’s Agent (in the reasonable exercise of
its discretion), update or renew, in each such case at such Borrower’s expense,
any application forms, certificates, documents or other evidence required from
time to time, properly completed and duly executed, to qualify for any
applicable exemption from or reduction of Taxes, including, without limitation,
the certificates, documents or other evidence required under
subsection 2.7C(iv) (unless such failure or delay did not occur on or
prior to the Second Restatement Date or the date of the applicable Assignment
and Acceptance, as the case may be, and results from a change in applicable law
after the Second Restatement Date or the date of the applicable Assignment and
Acceptance, as the case may be, which precludes such Agent, Arranger, Lender or
Tax Transferee, as applicable, from qualifying for such exemption or
reduction), (B) the gross negligence or willful misconduct of such Agent,
Arranger, Lender or Tax Transferee, or (C) such Agent, Arranger, Lender or Tax
Transferee being treated as a “conduit entity” within the meaning of Treasury
Regulation Section 1.881-3 or any successor provision thereto.


 


“Existing Holdings Senior Note Collateral”
means the pledges of the shares of Capital Stock and intercompany notes of
Domestic Borrowers and the other direct subsidiaries of Company pursuant to the
Pledge Agreement.


 


“Existing Holdings Senior Note Obligors”
means Holdings, and, on a subordinated basis, Company and Packaging.


 


“Existing Holdings Senior Notes” means the
following issues of Holdings public Indebtedness:  7.15% Senior Notes Due 2005; 8.10% Senior
Notes Due 2007; 7.35% Senior Notes Due 2008; 7.50% Senior Debentures Due 2010;
and 7.80% Senior Debentures Due 2018.


 


“Existing Holdings Senior Notes Redemption Collateral
Account” has the meaning assigned to that term in subsection
2.4B(ii)(e)(2).


 


“Existing Holdings Senior Notes Redemption Sublimit”
has the meaning assigned to that term in subsection 2.4B(ii)(e)(3).


 


26





















 


“Existing IRBs” means the Holmes County Ohio
5.85% Industrial Development Revenue Bonds with final maturity in 2007 and an
outstanding principal amount of approximately $685,000, the Kansas City,
Missouri Industrial Development Revenue Bonds with final maturity in 2008 and
an outstanding principal amount of approximately $9,000,000, and any
extensions, renewals or refinancings thereof to the extent that such
extensions, renewals and refinancings thereof do not result in an increase in
the aggregate principal amount of such Existing IRBs.


 


“Existing Letter of Credit” has the meaning assigned to that
term in subsection 2.8A.


 


“Existing Mortgage” has the meaning set
forth in subsection 5.10A.


 


“Existing Mortgaged Property” has the
meaning set forth in subsection 5.10A.


 


“Existing Owens-Brockway Senior Secured Notes” means
Owens-Brockway’s 8-7/8% Senior Secured Notes due 2009, Owens-Brockway’s 8-3/4%
Senior Secured Notes due 2012 and Owens-Brockway’s 7-3/4% Senior Secured Notes
due 2011 (and, for avoidance of doubt, any notes issued in exchange or
replacement thereof on substantially identical terms).


 


“Existing Owens-Brockway Senior Unsecured Notes” means
Owens-Brockway’s 8-1/4% Senior Notes due 2013 (and, for avoidance of doubt, any
notes issued in exchange or replacement thereof on substantially identical
terms).


 


“Facilities” means any and all real property
(including all buildings, fixtures or other improvements located thereon) now,
hereafter or heretofore owned, leased, operated or used by Company or any of
its Subsidiaries or any of their respective predecessors or Affiliates (other
than Holdings).


 


“Federal Funds Effective Rate” means, for any period, a
fluctuating interest rate equal for each day during such period to the weighted
average of the rates on overnight Federal funds transactions with members of
the Federal Reserve System arranged by Federal funds brokers, as published for
such day (or, if such day is not a Business Day, for the next preceding
Business Day) by the Federal Reserve Bank of New York, or, if such rate is not
so published for any day which is a Business Day, the average of the quotations
for such day on such transactions received by Administrative Agent from three
Federal funds brokers of recognized standing selected by Administrative Agent.


 


“Fee Payment Date” means each March 15, June 15,
September 15 and December 15 of each year, commencing with December
15, 2004.


 


“First Amended and Restated
Credit Agreement” has the meaning set forth in the recitals hereto.


 


“First Priority” means, with respect to any Lien
purported to be created in any Collateral pursuant to any Collateral Document,
that (i) such Lien is perfected and such Lien (other than floating charges
with respect to certain Collateral (the use of which with respect to such
Collateral has been approved by Administrative Agent), which for UK priority
purposes 


 


27





















 


ranks behind statutorily
preferred creditors) has priority over any other Lien on such Collateral (other
than Liens permitted pursuant to subsection 6.2A) and (ii) such Lien is
the only Lien (other than Liens permitted pursuant to subsection 6.2A) to which
such Collateral is subject.


 


“First Restatement Date” means June 13, 2003, the date upon
which the First Amended and Restated Credit Agreement became effective.


 


“Fiscal Quarter” means a fiscal quarter of any Fiscal Year.


 


“Fiscal Year” means the fiscal year of Company and its
Domestic Subsidiaries ending on December 31 of each calendar year.


 


“Flood Hazard Property” means an Existing Mortgaged Property
or an Additional Mortgaged Property located in an area designated by the
Federal Emergency Management Agency as having special flood or mud slide
hazards.


 


“Foreign Entity” means any Subsidiary or Joint Venture of
Company more than 80% of the sales, earnings or assets (determined on a
consolidated basis) of which are located or derived from operations outside of
the United States of America.


 


“Foreign Subsidiary” means (i) any Subsidiary of Company
identified as such on Schedule E annexed hereto, (ii) any Subsidiary of
any Subsidiary described in clause (i), except for ACI America Holdings, Inc.
and (iii) in addition, any Subsidiary acquired, incorporated or otherwise
established by Company on or after the Third Restatement Date which is
organized under the laws of a jurisdiction other than the United States of
America or any State thereof and more than 80% of the sales, earnings or assets
(determined on a consolidated basis) of which are located or derived from
operations in territories of the United States of America and jurisdictions
outside the United States of America.


 


“French  Tranche C1 Lender”
means a Lender that has French Tranche C1 Term Loan Exposure.


 


“French Tranche C1 Term Loan Exposure” means, with respect to
any Lender as of any date of determination, the outstanding principal amount of
the French Tranche C1 Term Loans of that Lender.


 


“French Tranche C1 Term Loan Notes”
means the promissory notes of BSN issued pursuant to subsection 2.1G to
evidence the French Tranche C1 Term Loans of any Lenders, substantially in the
form of Exhibit IV-C1 annexed hereto, as they may be amended,
supplemented or otherwise modified from time to time.


 


“French Tranche C1 Term
Loans” means the
French Tranche C1 Term Loans made by Lenders to BSN pursuant to subsection
2.1A(v) of the Second Amended and Restated Credit Agreement and amended and
restated as French Tranche C1 Term Loans hereunder on the Third Restatement
Date.


 


“French  Tranche C2 Lender”
means a Lender that has French Tranche C2 Term Loan Exposure.


 


28





















 


“French Tranche C2 Term Loan Exposure” means, with respect to
any Lender as of any date of determination, the outstanding principal amount of
the French Tranche C2 Term Loans of that Lender.


 


“French Tranche C2 Term Loan Notes”
means the promissory notes of BSN issued pursuant to subsection 2.1G to
evidence the French Tranche C2 Term Loans of any Lenders, substantially in the
form of Exhibit IV-C2 annexed hereto, as they may be amended,
supplemented or otherwise modified from time to time.


 


“French Tranche C2 Term
Loans” means the
Loans made by Lenders to BSN pursuant to subsection 2.1A(vi) of the Second
Amended and Restated Credit Agreement and amended and restated as French
Tranche C2 Term Loans hereunder on the Third Restatement Date.


 


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


 


“Funding Date” means the date of the funding of a Loan.


 


“FX Trading Office” means such office of Administrative Agent
as it may designate as such from time to time in a written notice delivered to
Borrowers’ Agent.


 


“GAAP” means, subject to the provisions of
subsection 1.2, generally accepted accounting principles set forth in the
opinions and pronouncements of the Accounting Principles Board of the American
Institute of Certified Public Accountants and statements and pronouncements of
the Financial Accounting Standards Board or in such other statements by such
other entity as may be approved by a significant segment of the accounting
profession, which are applicable to the circumstances as of the date of
determination.


 


“General Collateral Account” is defined in
the Security Agreement.


 


“Governing Body” means the board of directors or
other body having the power to direct or cause the direction of the management
and policies of a Person that is a corporation, partnership, trust or limited
liability company.


 


“Government Authority” means any political
subdivision or department thereof, any other governmental or regulatory body,
commission, central bank, board, bureau, organ or instrumentality or any court,
in each case whether federal, state, local or foreign.


 


“Governmental Authorization” means any permit, license,
authorization, plan, directive, consent order or consent decree of or from any
foreign, federal, state or local governmental authority, agency or court.


 


“Ground Leasehold Interest” as applied to
any Person, means any lease by which such Person leases the fee interest in
real property and owns the improvements thereon (until the termination of the
lease).


 


29





















 


“Guarantied Obligations” has the meaning
assigned to that term in subsection 9.1.


 


“Guaranties” means, collectively, the
Company Guaranty, the Domestic Borrowers’ Guaranty, the Subsidiary Guaranty and
the Offshore Guaranties.


 


“Harbor Capital Subsidiaries” means,
collectively, OI Advisors, Inc. (f/k/a/ Harbor Capital Advisors, Inc.), OI
Securities, Inc. (f/k/a/ HCA Securities, Inc.) and OI Transfer, Inc. (f/k/a
Harbor Transfer, Inc.).


 


“Hazardous Materials” means any substance that is defined or
listed as a hazardous or toxic substance under any present or future
Environmental Law or that is otherwise regulated or prohibited or subject to
investigation or remediation under any present or future Environmental Law
because of its hazardous or toxic properties, including (i) any substance
that is a “hazardous substance” under CERCLA (as defined in the definition of “Environmental
Laws”) and (ii) petroleum wastes or products.


 


“Hazardous Materials
Activity” means any
past, current, proposed or threatened activity, event or occurrence involving
any Hazardous Materials, including the use, manufacture, possession, storage,
holding, presence, existence, location, Release, threatened Release, placement,
generation, transportation, processing, construction, treatment, abatement,
removal, remediation, disposition or handling of any Hazardous Materials, and
any corrective action or response action with respect to any of the foregoing.


 


“Hedge Agreement” means an Interest Rate
Agreement or a Currency Agreement designed to hedge against fluctuations in
interest rates or currency values, respectively.


 


“Holdings” means Owens Illinois, Inc., a
Delaware corporation.


 


“Holdings Ordinary Course Payments” means
dividends or other distributions by, or payments of intercompany indebtedness
from, Company to Holdings necessary to permit Holdings to pay any of the
following items which are then due and payable: 
(s) payments in respect of Permitted Holdings Hedging Obligations, (t)
cash interest on Permitted Holdings Debt Obligations, (u) principal of Existing
IRBs and new IRBs issued by Holdings after the Second Restatement Date provided
that such new IRB’s mature after the Tranche C Term Loan Maturity Date and
shall not exceed $50,000,000 in the aggregate, (v) to redeem, repay or
otherwise repurchase the Existing Holdings Senior Notes to the extent not
prohibited by subsection 6.12B, (w) claims of persons for exposure to asbestos-containing
products and expenses related thereto, (x) so long as no Potential Event of
Default arising under subsections 7.1, 7.6, 7.9 or 7.12 or Event of
Default shall exist (or shall be caused by such payment), (i) cash dividends on
Holdings’ existing preferred stock and Holdings Permitted Preferred Stock
issued after the Third Restatement Date and (ii) share repurchases of
Holdings’ Capital Stock in an aggregate amount equal to the lesser of 2,000,000
shares or $25,000,000, (y) consolidated tax liabilities of Holdings and its
Subsidiaries and (z) general administrative costs and other on-going
expenses of Holdings in the ordinary course of business consistent with past
practices.


 


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“Indebtedness”, as applied to any Person, means (i) all
indebtedness for borrowed money, (ii) that portion of obligations with
respect to Capital Leases which is properly classified as a liability on a
balance sheet in conformity with GAAP (subject to subsection 1.2 hereof),
(iii) notes payable and drafts accepted representing extensions of credit
whether or not representing obligations for borrowed money, (iv) the
amount of all honored but unreimbursed drawings under letters of credit,
(v) any obligation owed for all or any part of the deferred purchase price
of property or services, which purchase price is (a) due more than six
months from the date of incurrence of the obligation in respect thereof or
(b) evidenced by a note or similar written instrument, (vi) all
indebtedness secured by any Lien on any property or asset owned or held by that
Person regardless of whether the indebtedness secured thereby shall have been
assumed by that Person or is nonrecourse to the credit of that Person, and
(vii) every obligation of such Person under any Synthetic Lease treated as an
operating lease under generally accepted accounting principles and as a loan or
financing for U.S. income tax purposes; provided, however, that
with respect to any indebtedness of the type described in the foregoing clause
(vi) which has not been assumed by that Person or is otherwise nonrecourse to
the credit of that Person, the amount of such indebtedness shall be deemed to
be the lesser of the outstanding principal amount of such indebtedness and the
fair market value of the property or assets of such Person securing such
indebtedness.


 


“Intellectual Property” means all patents,
trademarks, tradenames, copyrights, technology and software, used in or
necessary for the conduct of the business of Company and its Subsidiaries as
currently conducted that are material to the condition (financial or
otherwise), business or operations of Company and its Subsidiaries, taken as a
whole.


 


“Intercreditor Agreement” means the Amended and Restated
Intercreditor Agreement dated as of June 13, 2003, among Collateral Agent, DB,
as Administrative Agent hereunder, the trustees in respect of the Existing
Owens-Brockway Senior Secured Notes, the trustees in respect of the Existing
Holdings Senior Notes, such Lenders or Affiliates of Lenders which are holders
of Other Permitted Credit Exposure or party to Interest Rate Agreements or
Currency Agreements, which executed acknowledgments to the Original
Intercreditor Agreement, have executed acknowledgments to the Amended and
Restated Intercreditor Agreement or in the future execute acknowledgments to
such Amended and Restated Intercreditor Agreement, and, such other Persons who
may become parties to the Intercreditor Agreement in accordance with the terms
thereof, which in the future execute acknowledgments to the Intercreditor
Agreement, as amended by the first amendment thereto dated as of the Second
Restatement Date and by the second amendment thereto dated as of the Third
Restatement Date in the form attached hereto as Exhibit XVII, and as
such Intercreditor Agreement may hereafter be amended, supplemented or modified
from time to time.


 


“Interest Payment Date” means, with respect to any Euro Rate
Loan, the last day of each Interest Period applicable to such Loan; provided
that in the case of each Interest Period of six months or longer, “Interest
Payment Date” shall also include each three-month anniversary of the
commencement of that Interest Period.


 


“Interest Period” means any interest period applicable to a
Euro Rate Loan as determined pursuant to subsection 2.2B.


 


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“Interest Rate Agreement” means any interest rate swap
agreement, interest rate cap agreement, interest rate collar agreement or other
similar agreement or arrangement.


 


“Interest Rate Determination Date” means with respect to Euro
Rate Loans, the second Business Day prior to the first day of the related
Interest Period.


 


“Interest Rate Obligations” has the meaning
assigned to the term in subsection 9.1.


 


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


 


“Investment”, as applied to any Person, means any direct or
indirect purchase or other acquisition by that Person of, or of a beneficial
interest in, stock or other Securities of any other Person, or any direct or
indirect loan, advance (other than advances to employees for moving and travel
expenses, drawing accounts and similar expenditures in the ordinary course of
business) or capital contribution by that Person to any other Person, including
all indebtedness and accounts receivable from that other Person which are not
current assets or did not arise from sales to that other Person in the ordinary
course of business.  The amount of any
Investment shall be the original cost (which shall not include (i) the amount
of any Indebtedness of the Person that is the subject of such Investment that
is assumed by the Person making such Investment or (ii) the value of any
Common Stock issued as all or a portion of the consideration payable in
connection with such Investment) or, in the case of an Investment consisting of
non-cash consideration received in connection with an Asset Sale or other sale
of assets, the original value of such Investment plus the cost of all additions
thereto and less returns of capital to the Person making the Investment,
without any adjustments for increases or decreases in value, or write-ups,
write-downs or write-offs with respect to such Investment.


 


“IP Collateral” means, collectively, the
Intellectual Property that constitutes Collateral under the Collateral
Documents.


 


“IRBs” means industrial revenue bonds.


 


“Issuing Lender” means, with respect to any Letter of Credit,
the Lender which agrees or is otherwise obligated to issue such Letter of
Credit, determined as provided in subsection 2.8C; provided that,
in the event DB is to be an Issuing Lender, DB may delegate the issuance of the
applicable Letter of Credit to an Affiliate, provided, further, that
in the event of any such delegation by DB, DB shall be deemed to be the Issuing
Lender for purposes relating to the utilization of the Revolving Loan
Commitments under this Agreement, although such Affiliate shall be entitled to
all rights of reimbursement relating to such Letter of Credit or DB and such
Affiliate may apportion all rights and obligations relating to such Letter of
Credit as they may agree and such apportionment shall be binding for all
purposes hereunder.


 


“Italian Overdraft Account” means the account established by
Avir with the Italian Overdraft Account Provider and referenced in the Italian
Overdraft Agreement.


 


“Italian Overdraft Account Provider” means Deutsche Bank,
A.G. (Milan Branch) or any successor Italian Overdraft Account Provider
pursuant to subsection 10.2E; 


 


32





















 


provided, however, that no
such Lender shall be an Italian Overdraft Account Provider until Avir and such
Lender have executed and delivered an Italian Overdraft Agreement to
Administrative Agent.


 


“Italian Overdraft Agreement” means any Offshore Overdraft
Agreement by and between Deutsche Bank, AG (Milan Branch) and Avir in effect as
of the Third Restatement Date, and any successor Offshore Overdraft Agreement
executed and delivered by Avir and any successor Italian Overdraft Account
Provider pursuant to subsection 10.2E, in substantially the form of Exhibit VIII
annexed hereto, with such modifications thereto as may be approved by
Administrative Agent, as any such Offshore Overdraft Agreement may hereafter be
amended, amended and restated, supplemented or otherwise modified from time to
time in accordance with the terms thereof and hereof.


 


“Italian Overdraft Amount” means, as at any date of
determination, the aggregate principal amount of outstanding overdrafts charged
to the Italian Overdraft Account.


 


“Italian Revolving Loan
Commitment” means the commitment of a Lender to make Italian
Revolving Loans to Avir pursuant to subsection 2.1C, and “Italian Revolving Loan Commitments” means such commitments
of all Lenders in the aggregate.


 


“Italian Revolving Loan
Exposure” means, with respect to any Lender as of any date of
determination (i) prior to the termination of the Revolving Loan
Commitments, that Lender’s Italian Revolving Loan Commitment, and
(ii) after the termination of the Revolving Loan Commitments, the sum of
(a) the aggregate outstanding principal amount of the Italian Revolving Loans
of that Lender plus (b) in the case of Italian Overdraft Account
Provider, the Dollar Equivalent of the Italian Overdraft Amount (net of any
participations therein purchased by other Lenders) plus (c) the
aggregate amount of all participations purchased by that Lender in the Italian
Overdraft Amount.


 


“Italian Revolving Loan Note” means any promissory note of
Avir, substantially in the form of Exhibit VI annexed hereto, issued in
favor of a Lender pursuant to subsection 2.1G(iv) to evidence the Italian
Revolving Loans of such Lender, as such promissory note may be amended,
supplemented or otherwise modified from time to time.


 


“Italian Revolving Loans” means the Loans made by Lenders to
Avir pursuant to subsection 2.1C.


 


“Joint Venture” means a joint venture, partnership or other
similar arrangement, whether in corporate, partnership or other legal form; provided
that, as to any such arrangement in corporate form, such corporation shall not,
as to any Person of which such corporation is a Subsidiary, be considered to be
a Joint Venture to which such Person is a party.


 


“KKR” means Kohlberg Kravis Roberts & Co. L.P., a
Delaware limited partnership.


 


“Landlord Consent and Estoppel” means, with
respect to any Ground Leasehold Interest, a letter, certificate or other
instrument in writing from the lessor under the related lease pursuant to which
such lessor agrees for the benefit of Collateral Agent to such 


 


33





















 


matters relating to such
leasehold and the Mortgage to be recorded thereon as Collateral Agent may
reasonably request including the existence or absence of defaults, consent to
the recordation and foreclosure of the Mortgage, the transfer of the Ground
Leasehold Interest following foreclosure, and a notice and cure period for
Collateral Agent with respect to any default under such leasehold.


 


“L/C Collateral Account” is defined in the
Security Agreement.


 


“LC Disbursement” means a payment made by an
Issuing Lender pursuant to a Letter of Credit.


 


“Lender” and “Lenders” have
the meanings assigned to those terms in the introduction to this Agreement and
shall include each Agent in its individual capacity as a lender hereunder; provided
that “Lender” and “Lenders” shall also include the successors and permitted
assigns of Lenders pursuant to subsection 10.2B; and provided, further
that the term “Lenders” when used in the context of a particular Commitment or
Loan, shall mean Lenders having that Commitment or making that Loan.


 


“Letter of Credit” or “Letters of Credit”
means Commercial Letters of Credit and Standby Letters of Credit issued or to
be issued by Issuing Lenders for the account of Borrowers (other than Avir,
United Glass and O-I Canada except as described in subsection 2.8A)
pursuant to subsection 2.8.


 


“Letter of Credit Usage” means, as at any date of
determination, the sum of (i) the maximum aggregate amount which is or at
any time thereafter may become available for drawing under all Letters of
Credit then outstanding plus (ii) the aggregate amount of all drawings
under Letters of Credit honored by Issuing Lenders and not theretofore
reimbursed by a Borrower.  For purposes
of this definition, any amount described in clause (i) or (ii) of the preceding
sentence which is denominated in a currency other than Dollars shall be valued
based on its Dollar Equivalent as of the applicable date of determination.


 


“Lien” means any lien, mortgage, pledge, security interest,
charge or encumbrance of any kind (including any conditional sale or other
title retention agreement, any lease in the nature thereof, and any agreement
to give any security interest) and any other agreement intended to create any
of the foregoing.


 


“Loan” or “Loans” means
one or more of the Tranche A1 Term Loans, the Tranche B1 Term Loans, the French
Tranche C1 Term Loans, the French Tranche C2 Term Loans, the Revolving Loans,
the Offshore Revolving Loans, the Additional Term Loans or the Refinancing Term
Loans or any combination thereof.


 


“Loan Documents” means this Agreement, the Notes, the
Domestic Overdraft Agreement, any Offshore Overdraft Agreements, the Letters of
Credit, any Borrowing Subsidiary Agreements, the Guaranties and the Collateral
Documents.


 


“Loan Limitation Notice”
has the meaning assigned to that term in subsection 2.1E(iv).


 


34





















 


“Loan Party” means each of Borrowers, Company and, upon
execution of a Loan Document thereby, any of Company’s other Subsidiaries from
time to time executing such Loan Document, and “Loan Parties”
means all such Persons, collectively.


 


“Margin Stock” has the meaning assigned to that term in
Regulation U of the Board of Governors of the Federal Reserve System as in
effect from time to time.


 


“Material Adverse Effect” means (i) a material adverse
effect upon the business, operations, properties, assets or condition
(financial or otherwise) of Company and its Subsidiaries, taken as a whole, or
(ii) a material adverse effect on the ability of Company and its
Subsidiaries, taken as a whole, to perform, or of any Agent, Arranger or Lender
to enforce, the Obligations.


 


“Material Subsidiary” means each indirect or
direct Subsidiary of Holdings now existing or hereafter acquired or formed
indirectly or directly by Holdings which (x) for the most recent Fiscal Year of
Holdings, accounted for more than 5% of the consolidated revenues of Holdings
or (y) as at the end of such Fiscal Year, was the owner of more than 5% of the
consolidated assets of Holdings.


 


“Maximum Consolidated Capital Expenditures Amount”
means, for any Fiscal Year of Company and its Subsidiaries, an amount not to
exceed $550,000,000 plus, solely in the case of Fiscal Years 2003, 2004
and 2005, an additional amount not to exceed $130,000,000 in the aggregate for
all such Fiscal Years expended in connection with the development and
construction of a new glass plant located in the United States of America.


 


“Moody’s” means Moody’s Investors Service, Inc.


 


“Mortgage” means (i) a security
instrument (whether designated as a deed of trust or a mortgage or by any
similar title) executed and delivered by any Loan Party, in a form approved by
Collateral Agent, a form customarily used to create Liens on real property
interests in Australia, the UK, Spain or the Netherlands, as appropriate, and
approved by Collateral Agent or in such other form as may be approved by
Collateral Agent in its sole discretion, in each case with such changes thereto
as may be recommended by Collateral Agent’s local counsel based on local laws
or customary local mortgage or deed of trust practices, or (ii) at
Collateral Agent’s option, in the case of an Additional Mortgaged Property, an
amendment to an existing Mortgage, in form satisfactory to Collateral Agent,
adding such Additional Mortgaged Property to the Real Property Assets
encumbered by an existing Mortgage, in either case as such security instrument
or amendment may be amended, supplemented or otherwise modified from time to
time.  “Mortgages”
means all such instruments, including the Existing Mortgages and any Additional
Mortgages, collectively.


 


“Mortgaged Property” means either an
Existing Mortgaged Property or an Additional Mortgaged Property.


 


“Multiemployer Plan” means a “multiemployer plan”, within the
meaning of Section 4001(a)(3) of ERISA, with respect to which Company, any
of its Subsidiaries or any ERISA Affiliate may have liability.


 


35





















 


“Net Asset Sale Proceeds”, with respect to
any Asset Sale, means Cash payments (including any Cash received by way of
deferred payment pursuant to, or by monetization of, a note receivable or
otherwise, but only as and when so received, including when released from any
escrow) received from such Asset Sale, (A) net of any bona fide direct costs
incurred in connection with such Asset Sale, including (i) taxes reasonably
estimated to be payable in connection with such Asset Sale, (ii) reasonable commissions
and other fees and expenses incurred, and (iii) payment of the outstanding
principal amount of, premium or penalty, if any, and interest on any
Indebtedness (other than the Loans) that is paid (and is not prohibited from
being paid under the terms of this Agreement) with the gross proceeds of such
Asset Sale, and (iv) a reasonable reserve for the after-tax costs of any
indemnification payments (fixed and contingent) attributable to seller’s
indemnities to the purchaser undertaken by Holdings and its Subsidiaries in
connection with such Asset Sale, (B) in the case of an Asset Sale by a Domestic
Borrower or Subsidiary Guarantor that is a Domestic Subsidiary, net of any
amount used within 355 days of the date of such Asset Sale to make Investments
in Domestic Subsidiaries or purchase assets or reinvest in the business of the
Company and its Subsidiaries within the United States of America, (C) in the
case of an Asset Sale by an Offshore Borrower (other than Avir or O-I Canada)
or Offshore Guarantor, net of any amount used within 355 days of the date of
such Asset Sale to make Investments in a Loan Party (other than Avir or O-I
Canada) or to purchase assets or reinvest in the business of one or more of the
Loan Parties (other than Avir or O-I Canada) or (D) in the case of an Asset
Sale by a Foreign Subsidiary other than an Offshore Borrower (other than Avir
or O-I Canada) or Offshore Guarantor, net of any amount used within 355 days of
the date of such Asset Sale to make Investments permitted hereunder or purchase
assets or to reinvest in the business of Company and its Subsidiaries.


 


“Net Debt Securities Proceeds” means the
Cash proceeds (net of underwriting discounts and commissions, premiums on any
Indebtedness (other than Loans) to be redeemed with such proceeds as permitted
under this Agreement and other reasonable costs and expenses associated
therewith, including reasonable legal fees and expenses) from the incurrence of
Indebtedness by Holdings, Company or any of its Subsidiaries (other than Indebtedness
permitted by subsection 6.1 (except subsections 6.1(vii), 6.1(viii) 6.1(ix),
and 6.1(xiv)).


 


“Net Equity Securities Proceeds” means the
Cash proceeds (net of underwriting discounts and commissions and other
reasonable costs and expenses associated therewith, including reasonable legal
fees and expenses) from the issuance of Capital Stock by Holdings, Company or
any of its Domestic Subsidiaries (other than Domestic Borrowers or with respect
to employee and executive compensation plans and issuances to Company or any
Subsidiary) only to the extent such cash proceeds exceed $25,000,000 per
issuance or related series of issuances.


 


“Net Insurance/Condemnation Proceeds” means
any Cash payments or proceeds received by Company or any of its Subsidiaries
(i) under any casualty insurance policy in respect of a covered loss thereunder
or (ii) as a result of the taking of any assets of Company or any of its
Subsidiaries by any Person pursuant to the power of eminent domain,
condemnation or otherwise, or pursuant to a sale of any such assets to a
purchaser with such power under threat of such a taking, in each case net of
any actual and reasonable documented costs incurred by Company or any of its
Subsidiaries in connection with the adjustment or settlement of any claims of
Company or such Subsidiary in respect thereof and, in each case, only to the
extent such cash payments or proceeds, net of the foregoing documented costs,
exceed $25,000,000; provided, 


 


36





















 


that, for the avoidance of
doubt, any insurance proceeds received by Holdings or any Subsidiary for
asbestos claims shall not constitute Net Insurance/Condemnation Proceeds
hereunder.


 


“New Junior Debt” means Indebtedness
(including guarantees thereof and Indebtedness and guarantees issued in
exchange or in replacement thereof containing substantially identical terms)
having the following characteristics: 
(u) the obligors (whether borrowers, issuers, guarantors, pledgors or other
credit support parties) shall include only the Existing Holdings Senior Note
Obligors and no other Persons, (v) such Indebtedness shall be unsecured or
constitute Subordinated Indebtedness or both, (w) such Indebtedness shall not
have any scheduled payment of principal, prepayment, mandatory redemption or
sinking fund payment prior to April 1, 2008, except for provisions
requiring any permitted obligor under clause (u) above to repurchase all or a
portion of New Junior Debt from the holders thereof upon the occurrence of a “change
of control” or following an “asset sale” (such terms to be defined in the
indenture(s) governing such New Junior Debt), (x) the Net Debt Securities
Proceeds of such Indebtedness shall be applied as required by
subsection 2.4B(ii)(e), (y) the governing documentation for such
Indebtedness shall not contain any provision prohibiting the creation or
assumption of any Lien on any of the properties or assets of Company or its
Subsidiaries, whether then owned or thereafter acquired, to secure payment of
the Obligations or any agreement renewing, refinancing or extending the
Obligations or this Agreement, and (z) all other terms and conditions shall be
substantially comparable to those prevailing in the market place for comparable
debt issuances as determined by the Administrative Agent in its reasonable
judgment.


 


“New Senior Debt” means Indebtedness
(including guarantees thereof and Indebtedness and guarantees issued in
exchange or in replacement thereof containing substantially identical terms)
having the following characteristics: 
(u) the obligors (whether borrowers, issuers, guarantors, pledgors or
other credit support parties) shall include one or more of the obligors of the
Obligations (other than Foreign Subsidiaries) and no other Persons, (v) no
collateral (other than all or any portion of the Collateral) shall secure such
Indebtedness and the Liens on the Collateral, if any, shall rank subordinate to
or pari passu with the Liens securing the Obligations, (w) such Indebtedness
shall not have any scheduled payment of principal, prepayment, mandatory
redemption or sinking fund payment in excess of 1% of the outstanding principal
amount per year prior to April 1, 2008 except for provisions requiring any
permitted obligor under clause (u) above to repurchase all or a portion of New
Senior Debt from the holders thereof upon the occurrence of a “change of
control” or following an “asset sale” (such terms to be defined in the
indenture(s) governing such New Senior Debt), (x) the Net Debt Securities
Proceeds of such Indebtedness shall be applied as required by
subsection 2.4B(ii)(e), (y) the governing documentation for such
Indebtedness shall not contain any provision prohibiting the creation or
assumption of any Lien on any of the properties or assets of Company or its Subsidiaries,
whether then owned or thereafter acquired, to secure payment of the Obligations
or any agreement renewing, refinancing or extending the Obligations or this
Agreement, and (z) all other terms and conditions shall be substantially
comparable to those prevailing in the market place for comparable debt
issuances as determined by the Administrative Agent in its reasonable
judgment.  For the avoidance of doubt, in
any event, Existing Owens-Brockway Senior Secured Notes and Existing
Owens-Brockway Senior Unsecured Notes and related guarantees shall constitute
New Senior Debt.


 


37





















 


“Notes” means one or more of the Tranche A1 Term Loan Notes,
Tranche B1 Term Loan Notes, the French Tranche C1 Term Loan Notes, the French
Tranche C2 Term Loan Notes, the Revolving Notes or the Offshore Revolving Loan
Notes or any combination thereof.


 


“Notice of Borrowing” means a notice substantially in the
form of Exhibit I annexed hereto with respect to a proposed borrowing.


 


“Notice of Conversion/Continuation” means a notice
substantially in the form of Exhibit III annexed hereto with respect to
a proposed conversion or continuation.


 


“Notice of Request for Issuance of Letter of Credit” means a
notice in the form of Exhibit II annexed hereto with respect to the
proposed issuance of a Letter of Credit.


 


“O-I Australia” means Owens Illinois (Australia) Pty Limited.


 


“O-I Canada” means O-I Canada Corp.


 


“O-I General” means Owens-Illinois General, Inc.


 


“O-I Plastic” means OI Plastic Products FTS Inc.


 


“Obligations” means all obligations of every nature of any
Loan Party from time to time owed to Agents or Lenders or any of them under or
in respect of this Agreement whether for principal, interest, premium, fees,
indemnification or otherwise, the Notes, the Letters of Credit, the Offshore
Overdraft Agreements, the Domestic Overdraft Agreement or any of the other Loan
Documents (excluding, for the avoidance of doubt, all obligations under or in
respect of Other Lender Guarantied Obligations and Other Permitted Credit
Exposure).


 


“Officers’ Certificate” means, as applied to any corporation,
limited liability company, partnership or trust, a certificate executed on
behalf of such entity by (i) its Chairman of the Board (if an officer) or its
President or one of its Vice Presidents or, if applicable, its managing member,
general partner or trustee or, in the case of any Offshore Borrower, any
director or any attorney appointed by power of attorney, and (ii) by its Chief
Financial Officer, its Treasurer, any of its Assistant Treasurers, its
Controller or any of its Assistant Controllers or, in the case of any Offshore
Borrower, any other director or attorney appointed by power of attorney; provided,
that any Officers’ Certificate required to be delivered by Company on the Third
Restatement Date may be executed on behalf of Company by any one of the
foregoing officers.


 


“Offshore Banking Day” means with respect to any borrowings,
disbursements, payments, calculations, interest rates and Interest Periods
pertaining to (A) any Tranche A1 Term Loans, any French Tranche C1 Term Loan,
any French Tranche C2 Term Loan, any Offshore Revolving Loan or any Offshore
Overdraft Account, any Business Day which is also a day on which commercial
banks are open for business in, and on which dealings in the Applicable
Currency are carried on in, the location or the Offshore Funding and Payment
Office of the Offshore Overdraft Account Provider, as applicable, with respect
to such Applicable Currency, and (B) any Letter of Credit issued for the
account of an Offshore Borrower, a day on which the Issuing Lender is open for
business in the location in which such Letter of Credit is issued.


 


38





















 


“Offshore Borrower” means (i) with respect to Tranche A1 Term
Loans, ACI, (ii) with respect to Australian Revolving Loans, the Australian
Overdraft Account and any Letter of Credit issued for the account of an
Australian Offshore Borrower, any of the Australian Offshore Borrowers, as
applicable, (iii) with respect to UK Revolving Loans and the UK Overdraft
Account, United Glass, (iv) with respect to Canadian Revolving Loans and
the Canadian Overdraft Account, O-I Canada, (v) with respect to Italian
Revolving Loans and the Italian Overdraft Account, Avir and (vi) with respect to
French Tranche C1 Term Loans and French Tranche C2 Term Loans, BSN and “Offshore Borrowers” means United Glass, O-I Canada, Avir, the
Australian Offshore Borrowers and BSN, collectively.


 


“Offshore Collateral Documents” means the
Offshore Security Agreements and the Mortgages securing real property located
outside of the United States of America.


 


“Offshore Currency” means Sterling, ADollars, Euros or
Canadian Dollars.


 


“Offshore Currency Equivalent” means, at any time as to any
amount denominated in Dollars, the equivalent amount in the applicable Offshore
Currency as determined by the Administrative Agent at such time on the basis of
the Spot Rate for the purchase of such Offshore Currency with Dollars on the
most recent Calculation Date.


 


“Offshore Funding and Payment Office” means, with respect to
any Offshore Overdraft Account Provider, such office of such Offshore Overdraft
Account Provider as it may designate as such from time to time in a written
notice delivered to Administrative Agent, the Lenders and each Borrower.


 


“Offshore Funding Australian Borrower” has
the meaning set forth in subsection 2.9D.


 


“Offshore Guaranties” means, collectively, (i) the guaranties by
the English Wholly-Owned Subsidiaries and the Australian Wholly-Owned
Subsidiaries and the UK Offshore Borrower Cross Guaranty, collectively, all as
executed and delivered in connection with the Original Credit Agreement, as
amended, amended and restated or otherwise modified on the First Restatement
Date and the Second Restatement Date, as the same may be amended, amended and
restated or otherwise modified in a form satisfactory to Administrative Agent
in connection with the Third Restatement Date and thereafter from time to time
in accordance with the terms thereof and hereof and (ii)(a) the guaranty of the
French Tranche C1 Term Loans and the French Tranche C2 Term Loans by O-I Europe
SAS and each of the Subsidiaries of BSN that are Offshore Guarantors; all as
executed and delivered on the BSN Acquisition Closing Date, and (b) the
Australian Cross Guaranty, in each case as the same may be amended, restated or
otherwise modified from time to time in accordance with the terms thereof and
hereof.


 


“Offshore Guarantors” means, collectively, the Australian
Wholly-Owned Subsidiaries, the English Wholly-Owned Subsidiaries, O-I Europe
SAS and certain Subsidiaries of BSN.  As
of the Third Restatement Date, the Offshore Guarantors are set forth on Schedule
1.1A-1.


 


“Offshore Overdraft Account” means the UK Overdraft Account,
the Australian Overdraft Account, the Canadian Overdraft Account or the Italian
Overdraft Account, and 


 


39





















 


“Offshore Overdraft Accounts” means the
UK Overdraft Account, the Australian Overdraft Account, the Canadian Overdraft
Account and the Italian Overdraft Account, collectively.


 


“Offshore Overdraft Account Provider” means UK Overdraft
Account Provider, Australian Overdraft Account Provider, Canadian Overdraft
Account Provider or Italian Overdraft Account Provider, and “Offshore Overdraft Account Providers” means UK Overdraft
Account Provider, Australian Overdraft Account Provider, Canadian Overdraft
Account Provider and Italian Overdraft Account Provider, collectively.


 


“Offshore Overdraft Agreement” means the UK Overdraft
Agreement, the Australian Overdraft Agreement, the Canadian Overdraft Agreement
or the Italian Overdraft Agreement, and “Offshore Overdraft
Agreements” means the UK Overdraft Agreement, the Australian
Overdraft Agreement, the Canadian Overdraft Agreement and the Italian Overdraft
Agreement, collectively.


 


“Offshore Overdraft Amount” means the UK Overdraft Amount,
the Australian Overdraft Amount, the Canadian Overdraft Amount or the Italian
Overdraft Amount, and “Offshore Overdraft Amounts”
means the UK Overdraft Amount, the Australian Overdraft Amount, the Canadian
Overdraft Amount and the Italian Overdraft Amount, collectively.


 


“Offshore Revolving Loan”
means a UK Revolving Loan, an Australian Revolving Loan, a Canadian Revolving
Loan or an Italian Revolving Loan, and “Offshore Revolving Loans”
means such loans of all Lenders in the aggregate.


 


“Offshore Revolving Loan
Commitment” means a UK Revolving Loan Commitment, an Australian
Revolving Loan Commitment, a Canadian Revolving Loan Commitment or an Italian
Revolving Loan Commitment, and “Offshore Revolving Loan
Commitments” means all such commitments.


 


“Offshore Revolving Loan Note” means any of an Australian
Revolving Loan Note, Canadian Revolving Loan Note or an Italian Revolving Loan
Note.


 


“Offshore Security Agreements” means,
collectively, (i) the security agreements by United Glass, the Australian
Offshore Borrowers, each English Wholly-Owned Subsidiary and each Australian
Wholly-Owned Subsidiary, executed and delivered in connection with the Original
Credit Agreement, as the same were amended, amended and restated or otherwise
modified in connection with the First Restatement Date (including in accordance
with the terms of the First Supplemental Deed executed in connection therewith
by, among others, United Glass and the English Wholly-Owned Subsidiaries) and
the Second Restatement Date and as the same may be amended, amended and
restated or otherwise modified in a form satisfactory to Administrative Agent
in connection with the Third Restatement Date and thereafter from time to time
in accordance with the terms thereof and hereof and (ii) the security
agreements by O-I Europe SAS, BSN and its Subsidiaries, as executed and delivered on the BSN Acquisition Closing Date, as
the same may be amended, restated or otherwise modified from time to time in
accordance with the terms hereof and thereof.


 


“Offshore Sublimit” means, at any time, (i) as to United
Glass, collectively, the lesser of (a) $20,000,000 and (b) the Revolving Loan
Commitments then in effect, (ii) as to the


 


40





















 


Australian Offshore Borrowers, collectively, the lesser of (a)
$440,000,000 and (b) the Revolving Loan Commitments then in effect,
(iii) as to O-I Canada, the lesser of (a) $10,000,000 and
(b) the Revolving Loan Commitments then in effect and (iv) as to Avir, the
lesser of (a) $63,000,000 and (b) the Revolving Loan Commitments then in
effect; provided that such Offshore Sublimits may be decreased from time
to time pursuant to subsection 2.4G.


 


“Operating Lease”, as applied to any Person,
means any lease (including leases that may be terminated by the lessee at any
time) of any property (whether real, personal or mixed) that is not a Capital
Lease other than any such lease under which that Person is the lessor.


 


“Organizational Documents” means the documents (including charter
and bylaws, if applicable) pursuant to which a Person that is a corporation,
partnership, trust, joint stock company or limited liability company is
organized.


 


“Original Closing Date” means May 2, 2001.


 


“Original Credit Agreement” means that
certain Secured Credit Agreement dated as of April 23, 2001 by and among
Company, the Domestic Borrowers, the Offshore Borrowers, certain other
Subsidiaries of Company, the financial institutions party thereto and DB (then
known as Bankers Trust Company) as administrative agent, as amended through the
Fourth Amendment thereto dated as of April 16, 2003, which agreement was
amended and restated in its entirety by the First Amended and Restated Credit
Agreement and which agreement was further amended and restated in its entirety
by the Second Amended and Restated Credit Agreement and which agreement shall
further be amended and restated in its entirety pursuant to this Agreement.


 


“Original Intercreditor Agreement” means
that certain Intercreditor Agreement dated as of April 23, 2001, as amended
prior to the First Restatement Date, by and among DB, as administrative agent
for the lenders under the Original Credit Agreement, the other parties that
became party thereto in accordance with the provisions thereof and DB as collateral
agent therefor.


 


“Other Lender Guarantied Obligations” means
the obligations owed to Lenders and their Affiliates pursuant to Other
Permitted Credit Exposure, Interest Rate Obligations and Currency Obligations
which are guaranteed pursuant to one or more of the Guaranties.


 


“Other Permitted Credit Exposure” means the
obligations of Subsidiaries or Joint Ventures of Company owed to Lenders or
Affiliates of Lenders arising out of loans, advances, overdrafts, interest
rate, currency or hedge products and other derivative exposures and other
extensions of credit to such Subsidiaries or Joint Ventures.


 


“Owens-Brockway” means Owens-Brockway Glass
Container Inc., a Delaware corporation.


 


“Packaging” means Owens-Brockway Packaging,
Inc., a Delaware corporation and the parent corporation of Owens-Brockway.


 


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“Participating Member State” means any
member state of the European Community that adopts or has adopted the Euro as
its lawful currency in accordance with legislation of the European Community
relating to the European Monetary Union.


 


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


 


“Pension Plan” means a “pension plan”, as defined in
Section 3(2) of ERISA (other than a Multiemployer Plan), with respect to
which Company, any of its Subsidiaries or any ERISA Affiliate may have any
liability.


 


“Permitted Acquisition” means an Acquisition
permitted under subsection 6.3(v) or 6.3(xi).


 


“Permitted Covenant” means (i) any periodic
reporting covenant, (ii) any covenant restricting payments by Holdings
with respect to any securities of Holdings which are junior to the Permitted
Preferred Stock, (iii) any covenant the default of which can only result in an
increase in the amount of any redemption price, repayment amount, dividend rate
or interest rate, (iv) any covenant providing board observance rights with
respect to Holdings’ board of directors and (v) any other covenant that
does not adversely affect the interests of the Lenders (as reasonably
determined by Administrative Agent).


 


“Permitted
Encumbrances” means the following types of Liens:


 


(i)            Liens for taxes, assessments or governmental charges or
claims the payment of which is not at the time required by subsection 5.3;


 


(ii)           Statutory Liens and rights of set-off of banks, Liens of
landlords and Liens of carriers, warehousemen, suppliers, mechanics,
materialmen and other Liens imposed by law incurred in the ordinary course of
business (including title retention agreements arising in the ordinary course
of business) for sums not yet delinquent or being contested in good faith, if
such reserve or other appropriate provision, if any, as shall be required by
GAAP (subject to subsection 1.2) shall have been made therefor;


 


(iii)          Liens (other than any Lien imposed pursuant to
Section 401(a)(29) or 412(n) of the Internal Revenue Code or by ERISA)
incurred or deposits made in the ordinary course of business in connection with
workers’ compensation, unemployment insurance and other types of social
security, or to secure the performance of tenders, statutory obligations,
surety and appeal bonds, bids, leases, government contracts, performance and
return-of-money bonds and other similar obligations (exclusive of obligations
for the payment of borrowed money);


 


(iv)          Any attachment or judgment Lien not resulting in an Event
of Default under subsection 7.8;


 


(v)           Leases, subleases or licenses of occupancy granted to
others not interfering in any material respect with the business of Company and
its Subsidiaries, taken as a whole;


 


42





















 


(vi)          Easements, rights-of-way, restrictions, minor defects or
irregularities in title and other similar charges or encumbrances not
interfering in any material respect with the ordinary conduct of the business
of Company and its Subsidiaries, taken as a whole;


 


(vii)         Any (a) interest or title of a lessor under any lease not
prohibited by this Agreement, (b) restriction or encumbrance that the interest
or title of such lessor or sublessor may be subject to, or (c) subordination of
the interest of the lessee or sublessee under such lease to any restriction or
encumbrance referred to in the preceding clause (b), so long as the holder of
such restriction or encumbrance agrees to recognize the rights of such lessee
or sublessee under such lease;


 


(viii)        Liens arising from UCC financing statements regarding leases
or charges not prohibited by this Agreement;


 


(ix)           Liens in favor of customs and revenue authorities arising
as a matter of law to secure payment of customs duties in connection with the
importation of goods;


 


(x)            Liens incurred in the ordinary course of business
encumbering deposits made to secure obligations arising from statutory,
regulatory, contractual or warranty requirements of Company and its
Subsidiaries (excluding deposits securing the repayment of Indebtedness);


 


(xi)           Liens encumbering customary initial deposits and margin
deposits securing obligations under Interest Rate Agreements, Currency
Agreements and Commodities Agreements, and other Liens incurred in the ordinary
course of business and which are within the general parameters customary in the
industry securing obligations under Commodities Agreements;


 


(xii)          Liens securing reimbursement obligations under Commercial
Letters of Credit or bankers’ acceptance facilities, which Liens encumber
documents and other property to be acquired by drawings under such Commercial
Letters of Credit or drafts accepted under such bankers’ acceptance facilities;


 


(xiii)         exceptions to title disclosed by a
title policy, preliminary title report or certificate of title delivered
pursuant to subsection 5.10A and approved by Administrative Agent other
than Liens securing Indebtedness prohibited by subsection 6.1 or Contingent Obligations
prohibited by subsection 6.4;


 


(xiv)        Liens in the form of title retention in
connection with the acquisition of goods in the ordinary course of business
provided that there has occurred and is continuing no default in the obligations
related thereto;


 


(xv)         Liens arising in countries other than
the United States of America substantially comparable to the foregoing; and


 


43





















 


(xvi)        Liens created over credit balances in Dutch
bank accounts of any Subsidiaries in the ordinary course of their banking
arrangements pursuant to the general conditions of such bank.


 


“Permitted Holdings Debt Obligations” means
the Existing Holdings Senior Notes and the Existing IRBs and up to an
additional $50,000,000 of IRB financing and, to the extent Net Debt Securities
Proceeds are applied as required by subsection 2.4B(ii), New Senior Debt,
Refinancing Senior Debt and New Junior Debt issued by Holdings.


 


“Permitted Holdings Hedging Obligations” means obligations
under Hedging Agreements entered into by Holdings which could have been entered
into by any Domestic Borrower under Section 6.4(iii).


 


“Permitted Preferred Stock” means any
preferred stock of Holdings (or any equity security of Holdings that is
convertible or exchangeable into any preferred stock of Holdings), so long as
the terms of any such preferred stock or equity security of Holdings
(i) do not provide any collateral security, (ii) do not provide any
guaranty or other support by Company or any of its Subsidiaries, (iii) do
not contain any mandatory put, redemption, repayment, sinking fund or other
similar provision occurring before April 1, 2008, (iv)  do not contain any
covenants other than any Permitted Covenant, (v) do not grant the holders
thereof any voting rights except for (w) voting rights required to be
granted to such holders under applicable law, (x) customary voting rights
on fundamental matters such as mergers, consolidations, sales of substantial
assets, or liquidations involving Holdings and matters that could adversely
affect the rights, preferences, qualifications, limitations or restrictions of
such Permitted Preferred Stock and any other voting rights that are customary
in the market at the time of issuance of such Permitted Preferred Stock, as determined
by the Administrative Agent in its reasonable judgment, (y) other voting
rights to the extent not greater than or superior to those allocated to
Holdings Common Stock on a per share basis, and (z) voting rights with respect
to the election of directors arising from dividends in arrears, (vi) the Net
Equity Securities Proceeds arising therefrom are applied as required by
subsection 2.4B(ii)(d) and (vii) are otherwise reasonably satisfactory to
Administrative Agent.


 


“Person” means and includes natural persons, corporations,
limited partnerships, general partnerships, limited liability companies, joint
stock companies, joint ventures, associations, companies, trusts, banks, trust
companies, land trusts, business trusts or other organizations, whether or not
legal entities, and governments and agencies and political subdivisions
thereof.


 


“Plan” means an employee benefit plan (as defined in
Section 3(3) of ERISA) which Company or any of its Subsidiaries sponsors
or maintains, or to which Company or any of its Subsidiaries makes, is making
or is obligated to make contributions, or to which Company or any of its
Subsidiaries may have any liability, and includes any Pension Plan.


 


“Pledge Agreement” means the Amended and Restated Pledge
Agreement dated as of June 13, 2003, by and between Company and Packaging, as
amended by the first amendment thereto dated as of the Second Restatement Date and
the second amendment thereto dated as of the Third Restatement Date in the form
attached hereto as Exhibit XV, as such Pledge Agreement may hereafter be
amended, supplemented or otherwise modified from time to time.


 


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“Potential Event of Default” means a condition or event
which, after notice or lapse of time or both, would constitute an Event of
Default if that condition or event were not cured or removed within any
applicable grace or cure period.


 


“Pounds” and the sign “£” mean
the lawful currency of the UK; provided, however, that in the
event Pounds are replaced by the Euro, it is hereby acknowledged and agreed
that “Pounds” and “£” shall, on the date on which Pounds are replaced by the
Euro as the sole lawful currency of the UK, include the Euro; provided
that Pounds shall be retained as an Offshore Currency for so long as legally
permissible; provided further that any such conversion shall be based on
the rate of conversion officially fixed on the date the Euro replaces Pounds
for purposes of this Agreement.


 


“Prime Rate” means the rate which DB announces from time to
time as its prime lending rate, as in effect from time to time.  The Prime Rate is a reference rate and does
not necessarily represent the lowest or best rate actually charged to any
customer.  DB may make commercial loans
or other loans at rates of interest at, above or below the Prime Rate.


 


“Pro Forma Basis” means, as of any date of determination, the
calculation of the compliance of Borrowers with the financial covenants set
forth in subsection 6.6A and 6.6B or the calculation of the Consolidated Senior
Secured Leverage Ratio, after giving effect on a pro forma basis to any
Acquisition constituting a Pro Forma Event made during the four Fiscal Quarter
period most recently ended on or prior to such date of determination (the “Compliance Period”)(or made after the end of such Compliance
Period but on or before the date of determination),  and any disposition constituting a Pro Forma
Event made during such Compliance Period (or made after the end of such
Compliance Period but on or before the date of determination), other than sales
of inventory in the ordinary course of business and dispositions of obsolete
equipment on the following basis:


 


(i)            any Indebtedness incurred or assumed
by Holdings or any of its Subsidiaries in connection with such Acquisitions and
any Indebtedness repaid in connection with such Acquisitions or dispositions
shall be deemed to have been incurred or repaid, respectively, as of the first
day of the Compliance Period;


 


(ii)           if such Indebtedness incurred or
assumed by Holdings or any of its Subsidiaries in connection with such
Acquisitions has a floating or formula rate, then the rate of interest for such
Indebtedness for the applicable period shall be computed as if the rate in
effect for such Indebtedness on the relevant measurement date had been the
applicable rate for the entire applicable period;


 


(iii)          income statement items (whether
positive or negative) attributable to the property or business acquired or
disposed of in such Acquisitions or dispositions shall be included as if such
Acquisitions or dispositions took place on the first day of such Compliance
Period on a pro forma basis;


 


(iv)          for purposes of calculating
Consolidated Cash Flow Available for Fixed Charges, capital expenditures attributable
to any business acquired in such Acquisitions


 


45





















 


shall be included in Consolidated Capital Expenditures
as if such Acquisitions took place on the first day of such Compliance Period
on a pro forma basis; and


 


(v)           any historical extraordinary
non-recurring costs or expenses or other verifiable costs or expenses that will
not continue after the Acquisition or disposition date may be eliminated and
other expenses and cost reductions may be reflected on a basis consistent with
Regulation S-X promulgated by the Securities and Exchange Commission.


 


With
respect to any such Acquisitions, such pro forma calculations shall be based on
the consolidated balance sheet of such acquired Person or business and its
consolidated Subsidiaries as at the end of its most recent Fiscal Year or the
most recent fiscal period preceding such Acquisition and the related
consolidated statements of income and of cash flows for such period, which
shall have been previously provided to Administrative Agent and shall either
(1) have been reported on without a qualification arising out of the scope of
the audit by independent certified public accountants of nationally recognized
standing or (2) have been found reasonably acceptable by Administrative Agent.


 


“Pro Forma Event” means any disposition of
assets to third parties the fair market value of which equals or exceeds
$100,000,000 and any Acquisition in which the aggregate consideration paid or
given (including, without limitation, cash paid, Acquired Indebtedness or
assumed Indebtedness and the value of any other consideration paid or given) to
third parties equals or exceeds $100,000,000; including, without limitation,
the BSN Acquisition and the Plastics Sale.


 


“Pro Rata Share” means, with respect to any Lender, (i) with
respect to all payments, computations and other matters relating to Tranche A1
Term Loan of any Lender, the percentage obtained by dividing
(a) the Tranche A1 Term Loan Exposure of that Lender by
(b) the aggregate Tranche A1 Term Loan Exposure of all Lenders, (ii) 
with respect to all payments, computations and other matters relating to the
Tranche B1 Term Loan of any Lender, the percentage obtained by dividing
(a) the Tranche B1 Term Loan Exposure of that Lender by
(b) the aggregate Tranche B1 Term Loan Exposure of all Lenders, (iii) with
respect to all payments, computations and other matters relating to the French
Tranche C1 Term Loan of any Lender, the percentage obtained by dividing
(a) the French Tranche C1 Term Loan Exposure of that Lender by (b) the
aggregate French Tranche C1 Term Loan Exposure of all Lenders, (iv) with
respect to all payments, computations and other matters relating to the French
Tranche C2 Term Loan of any Lender, the percentage obtained by dividing
(a) the French Tranche C2 Term Loan Exposure of that Lender by
(b) the aggregate French Tranche C2 Term Loan Exposure of all Lenders, (v)
with respect to all payments, computations and other matters relating to the
Revolving Loan Commitment or the Revolving Loans of any Lender or any Letters
of Credit issued or participations therein purchased by any Lender or any
participations in the Domestic Overdraft Amount or any Offshore Overdraft
Amount or any Offshore Revolving Loans purchased by any Lender, the percentage
obtained by dividing (a) the Revolving Loan Exposure of that Lender
by (b) the aggregate Revolving Loan Exposure of all Lenders, (vi)
with respect to all payments, computations and other matters relating to the UK
Revolving Loan Commitments or the UK Revolving Loans of any Lender or
participations therein or any participations in the UK Overdraft Amount
purchased by any Lender, the percentage obtained by dividing (a) the UK


 


46





















 


Revolving Loan Exposure of that Lender by (b) the aggregate UK
Revolving Loan Exposure of all Lenders, (vii) with respect to all
payments, computations and other matters relating to the Australian Revolving
Loan Commitments or the Australian Revolving Loans of any Lender or any Letters
of Credit issued for the account of any Australian Offshore Borrower or
participations therein or any participations in the Australian Overdraft Amount
purchased by any Lender, the percentage obtained by dividing (a) the
Australian Revolving Loan Exposure of that Lender by (b) the aggregate
Australian Revolving Loan Exposure of all Lenders, (viii) with respect to
all payments, computations and other matters relating to the Canadian Revolving
Loan Commitments or the Canadian Revolving Loans of any Lender or any
participations in the Canadian Overdraft Amount purchased by any Lender, the
percentage obtained by dividing (a) the Canadian Revolving Loan
Exposure of that Lender by (b) the aggregate Canadian Revolving
Loan Exposure of all Lenders, (ix) with respect to all payments,
computations and other matters relating to the Italian Revolving Loan
Commitments or the Italian Revolving Loans of any Lender or any participations
in the Italian Overdraft Amount purchased by any Lender, the percentage
obtained by dividing (a) the Italian Revolving Loan Exposure of that
Lender by (b) the aggregate Italian Revolving Loan Exposure of all
Lenders, and (x) for all other purposes with respect to each Lender, the
percentage obtained by dividing (a) the sum of the Tranche A1 Term
Loan Exposure of that Lender plus Tranche B1 Term Loan Exposure of that
Lender plus the French Tranche C1 Term Loan Exposure of that Lender plus
the French Tranche C2 Term Loan Exposure plus the Revolving Loan
Exposure of that Lender by (b) the sum of the aggregate Tranche A1
Term Loan Exposure of all Lenders plus the aggregate Tranche B1 Term Loan
Exposure of all Lenders plus the aggregate French Tranche C1 Term Loan
Exposure of all Lenders plus the aggregate French Tranche C2 Term Loan
Exposure of all Lenders plus the aggregate Revolving Loan Exposure of
all Lenders, in any such case as the applicable percentage may be adjusted by
assignments permitted pursuant to subsection 10.2.  The initial Pro Rata Share of each Lender for
purposes of each of clauses (iii), (iv), (v), (vi), (vii), (viii), (ix) and (x)
of the preceding sentence is set forth opposite the name of that Lender in Schedule A
annexed hereto.  The initial Pro Rata
Share of each Lender for purposes of clauses (i) and (ii) are set forth in the
Register as of the date hereof.


 


“PTO” means the United States Patent and
Trademark Office or any successor or substitute office in which filings are
necessary or, in the opinion of Collateral Agent, desirable in order to create
or perfect Liens on any IP Collateral.


 


“Purchase Money Indebtedness” means
Indebtedness incurred simultaneously with or within 180 days after the
acquisition, construction or improvement of real property or tangible personal
property to finance such acquisition, construction or improvement of such
property.


 


“Real Property Asset”
means, at any time of determination, any fee interest then owned or Ground
Leasehold Interest then held (or in the case of United Glass or English
Wholly-Owned Subsidiary, any freehold interest then owned or leasehold interest
then held) by any Loan Party in any real property.


 


“Receivables Sale Indebtedness” means
Indebtedness incurred or deemed incurred or cash consideration received from
the sale of accounts receivable by Company or any


 


47





















 


of its Subsidiaries or a special purpose vehicle established by any of
them to purchase and sell such receivables.


 


“Recorded Leasehold Interest” means a lease
or memorandum thereof evidencing a Ground Leasehold Interest duly recorded in
the applicable jurisdiction in which the property underlying such Ground
Leasehold Interest is located.


 


“Reference
Lenders” means Deutsche Bank Trust Company Americas and Bank of
America, N.A.


 


“Refinancing Senior Debt” means Indebtedness
(including guarantees thereof and Indebtedness and guarantees issued in
exchange or in replacement thereof containing substantially identical terms)
having the following characteristics (u) the obligors shall include only the
Existing Holdings Senior Note Obligors and no other Persons, (v) any collateral
therefor shall include only the Existing Holdings Senior Note Collateral and no
other collateral and the Lien thereon, if any, shall be subordinated to the
Lien securing the Obligations, (w) such Indebtedness shall not have any
scheduled payment, prepayment, mandatory redemption or sinking fund payment
prior to April 1, 2008, except for provisions requiring any permitted
obligor under clause (u) above to repurchase all or a portion of Refinancing
Senior Debt from the holders thereof upon the occurrence of a “change of
control” or following an “asset sale” (such terms to be defined in the
indenture(s) governing such Refinancing Senior Debt), (x) the Net Debt
Securities Proceeds of such Indebtedness shall be applied as required by
subsection 2.4B(ii)(e), (y) the governing documentation for such
Indebtedness shall not contain any provision prohibiting the creation or
assumption of any Lien on any of the properties or assets of Company or its
Subsidiaries, whether then owned or thereafter acquired, to secure payment of
the Obligations or any agreement renewing, refinancing or extending the
Obligations or this Agreement, and (z) all other terms and conditions shall be
substantially comparable to those prevailing in the market place for comparable
debt issuances as determined by the Administrative Agent in its reasonable
judgment.


 


“Refinancing Term Loans” has the meaning
assigned to that term in subsection 2.1A(vii).


 


“Refinancing
Term Loan Margin”  means, as
of any date of determination, as used in the definition of “Applicable Base Rate
Margin”, the highest margin then applicable to outstanding Refinancing Term
Loans that are base rate loans, and, as used in the definition of “Applicable
Euro Margin”, the highest margin then applicable to outstanding Refinancing
Term Loans that are eurodollar or euro loans (with such margins applicable to
Refinancing Term Loans deemed to include all upfront or similar fees or
original issue discount (in each case amortized over the life of the applicable
loan) paid to all lenders providing such Refinancing Term Loans, but exclusive
of any arrangement, structuring or similar fees payable in connection therewith
that are not shared with all lenders providing such Refinancing Term Loans).


 


“Register”
has the meaning assigned to that term in subsection 2.1G.


 


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


 


48





















 


“Related Fund” means any fund that invests
in bank loans and is managed by the same investment advisor of a Lender or by
an Affiliate of such investment advisor.


 


“Release”
means any release, spill, emission, leaking, pumping, pouring, injection,
escaping, deposit, disposal, discharge, dispersal, dumping, leaching or
migration of Hazardous Materials into the indoor or outdoor environment
(including the abandonment or disposal of any barrels, containers or other
closed receptacles containing any Hazardous Materials), including the movement
of any Hazardous Materials through the air, soil, surface water or groundwater.


 


“Released Guarantors” means those Subsidiary Guarantors
listed on Schedule IC(1) to the First Amendment and released from their
obligations under the Subsidiary Guaranty pursuant to the First Amendment.  Each such Subsidiary Guarantor is referred to
herein as a “Released Guarantor.”


 


“Reporting Unit” means each of the units of the operations of
Company, as set forth on Schedule C annexed hereto, as such Schedule
C may hereafter be amended, supplemented or modified from time to time by
Company.


 


“Requisite
Class Lenders” means, at any time of determination (i) for
the Class of Revolving Lenders, Lenders having or holding more than 50% of the
aggregate Revolving Loan Exposure of all Lenders, (ii) for the Class of
Lenders having Tranche A1 Term Loan Exposure, Lenders having or holding more
than 50% of the aggregate Tranche A1 Term Loan Exposure of all Lenders, (iii)
for the Class of Lenders having Tranche B1 Term Loan Exposure, Lenders having
or holding more than 50% of the aggregate Tranche B1 Term Loan Exposure of all
Lenders, (iv) for the Class of Lenders having French Tranche C1 Term Loan
Exposure, Lenders having or holding more than 50% of the aggregate French Tranche
C1 Term Loan Exposure of all Lenders, and (v) for the Class of Lenders having
French Tranche C2 Term Loan Exposure, Lenders having or holding more than 50%
of the aggregate French Tranche C2 Term Loan Exposure of all Lenders.


 


“Requisite Lenders” means Lenders having or holding more than
50% of the sum of (a) the aggregate Tranche A1 Term Loan Exposure of all
Lenders plus (b) the aggregate Tranche B1 Term Loan Exposure of all
Lenders plus (c) the aggregate French Tranche C1 Term Loan Exposure of
all Lenders plus (d) the aggregate French Tranche C2 Term Loan Exposure
of all Lenders plus (e) the aggregate Revolving Loan Exposure of all
Lenders.


 


“Reservation Conditions” means, with respect
to any Net Debt Securities Proceeds, (i) the sum of (A) the aggregate amount of
Net Debt Securities Proceeds and Revolving Loans theretofore applied to repay,
repurchase or redeem Existing Holdings Senior Notes Due 2005 and/or 2007
(without prior reservation to either the Existing Holdings Senior Notes
Redemption Collateral Account or the Existing Holdings Senior Notes Redemption
Sublimit) plus (B) the aggregate amount of Net Debt Securities Proceeds
theretofore deposited in the Existing Holdings Senior Notes Redemption
Collateral Account (and not theretofore released to repay Loans) plus
(C) the aggregate amount of Net Debt Securities Proceeds theretofore reserved
in the Existing Holdings Senior Notes Redemption Sublimit (and not theretofore
released to repay Loans), plus (D) the aggregate amount of Net Debt
Securities Proceeds then


 


49





















 


proposed to be deposited in the Existing Holdings Senior Notes
Redemption Collateral Account and/or reserved within the Existing Holdings
Senior Notes Redemption Sublimit, does not exceed $650,000,000; (ii) after
giving effect to the proposed application of such Net Debt Securities Proceeds,
the Revolving Loan Commitments shall exceed the Total Utilization of Revolving
Loan Commitments by at least $250,000,000; and (iii) in the case of Net Debt Securities
Proceeds arising from the issuance of New Senior Debt, after giving effect to
the issuance of such New Senior Debt and the proposed application of the Net
Debt Securities Proceeds arising therefrom, the Consolidated Senior Secured
Leverage Ratio is less than 2.85:1.00.


 


“Responsible Officer” means any of the chief executive
officer, the president, any vice president, the chief financial officer, the
comptroller, the treasurer, any assistant treasurer, the controller or any
assistant controller of a Loan Party.


 


“Restricted Debt Obligations” means,
collectively, Existing Holdings Senior Notes, New Senior Debt, Refinancing
Senior Debt and New Junior Debt and the BSN Senior Subordinated Notes.


 


“Restricted Junior Payment” means (i) any dividend or
other distribution, direct or indirect, on account of any shares of any class
of stock of Company now or hereafter outstanding, except a dividend payable
solely in shares of that class of stock to the holders of that class,
(ii) any redemption, retirement, sinking fund or similar payment, purchase
or other acquisition for value, direct or indirect, of any shares of any class
of stock of Company now or hereafter outstanding, (iii) any payment made
to retire, or to obtain the surrender of, any outstanding warrants, options or
other rights to acquire shares of any class of stock of Company now or
hereafter outstanding, and (iv) any payment or prepayment of principal of,
premium, if any, or interest on, or redemption, purchase, retirement,
defeasance (including in-substance or legal defeasance), sinking fund or
similar payment with respect to, any Subordinated Indebtedness, including,
without limitation, Company’s intercompany note to Holdings.


 


“Revolving Lenders” means the Lenders having
Revolving Loan Exposure.


 


“Revolving Loan Commitment” means the commitment of a Lender
to make Revolving Loans from and after the Third Restatement Date to each of
the Domestic Borrowers pursuant to subsection 2.1A(v), and “Revolving Loan Commitments” means such commitments of all Lenders
to all Domestic Borrowers in the aggregate.


 


“Revolving
Loan Commitment Termination Date” means April 1, 2007.


 


“Revolving Loan Exposure” means, with respect to any Lender
as of any date of determination (i) prior to the termination of the Revolving
Loan Commitments, that Lender’s Revolving Loan Commitment and (ii) after the
termination of the Revolving Loan Commitments, the sum (without duplication) of
(a) aggregate outstanding principal amount of the Revolving Loans of that
Lender plus (b) in the event that Lender is an Issuing Lender, the
aggregate Letter of Credit Usage in respect of all Letters of Credit issued by
that Lender (in each case net of any participations purchased by other Lenders
in such Letters of Credit or any unreimbursed drawings thereunder) plus
(c) the aggregate amount of all participations purchased


 


50





















 


by that Lender in any outstanding Letters of Credit or any unreimbursed
drawings under any Letters of Credit plus (d) in the case of
Administrative Agent (in its capacity as a Lender), the Domestic Overdraft
Amount (net of any participations therein purchased by other Lenders) plus
(e) the aggregate amount of all participations purchased by that Lender in
the Domestic Overdraft Amount plus (f) the Dollar Equivalent of all
participations purchased by that Lender in the Offshore Overdraft Amount (net
of any participations therein purchased by other Lenders) plus (g) the
aggregate outstanding principal amount of any Offshore Revolving Loans of such
Lender (net of any participations therein purchased by other Lenders) plus
(h) in the case of any Offshore Overdraft Account Provider with respect to a
particular Offshore Currency, the Dollar Equivalent of the relevant Offshore
Overdraft Amount (net of any participations therein purchased by other
Lenders).


 


“Revolving
Loans” means the Loans made by Lenders to Domestic Borrowers
pursuant to subsection 2.1A(v).


 


“Revolving Note” means a promissory note of a Domestic
Borrower substantially in the form of Exhibit V annexed hereto, issued
in favor of Lenders pursuant to subsection 2.1G(iv) to evidence the
Revolving Loans made to such Domestic Borrower, as they may be amended,
supplemented or otherwise modified from time to time.  “Revolving
Notes” means all such promissory notes collectively, as they may be
amended, supplemented or otherwise modified from time to time.


 


“S&P”
means Standard & Poor’s Ratings Group, a division of The McGraw-Hill
Companies, Inc.


 


“Same Day Funds” means immediately available funds.


 


“Second
Amended and Restated Credit Agreement” shall have the meaning set
forth in the recitals hereto.


 


“Second
Restatement Date” means March 15, 2004,
the date upon which the Second Amended and Restated Credit Agreement became
effective.


 


“Security Agreement” means, the Amended and
Restated Security Agreement dated June 13, 2003, by and among Company, Domestic
Borrowers and the Subsidiary Guarantors, as amended by the First Amendment
thereto dated as of the Second Restatement Date in the form attached hereto as Exhibit
XVI, as such Security Agreement may hereafter be amended, supplemented or
otherwise modified from time to time.


 


“Securities” means any stock, shares, voting trust
certificates, bonds, debentures, options, warrants, notes, or other evidences
of indebtedness, secured or unsecured, convertible, subordinated or otherwise,
or in general any instruments commonly known as “securities” or any
certificates of interest, shares or participations in temporary or interim
certificates for the purchase or acquisition of, or any right to subscribe to,
purchase or acquire, any of the foregoing.


 


“Securities Act” means the Securities Act of 1933, as amended
from time to time, and any successor statute.


 


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“Solvent”, (A) with respect to any
Person organized under the laws of a state of the United States of America,
means that as of the date of determination both (i)(a) the then fair saleable
value of the property of such Person is (1) greater than the total amount of
liabilities (including contingent liabilities) of such Person and (2) not less
than the amount that will be required to pay the probable liabilities on such
Person’s then existing debts as they become absolute and due considering all
financing alternatives and potential asset sales reasonably available to such
Person; (b) such Person’s capital is not unreasonably small in relation to its
business or any contemplated or undertaken transaction; and (c) such Person
does not intend to incur, or believe (nor should it reasonably believe) that it
will incur, debts beyond its ability to pay such debts as they become due; and
(ii) such Person is “solvent” within the meaning given that term and similar
terms under applicable laws relating to fraudulent transfers and conveyances;
(B) with respect to any Person incorporated in England and Wales,
Scotland, Germany or France means that as of the date of determination of
solvency the value of such Person’s assets is not less than the amount of its
liabilities, taking into account its contingent and prospective liabilities;
and (C) with respect to any Person organized under the laws of Australia,
the Netherlands, Germany, France or Spain means that such Person is able to pay
its debts as such debts become due and payable. 
For purposes of this definition, the amount of any contingent liability
at any time shall be computed as the amount that, in light of all of the facts
and circumstances existing at such time, represents the amount that can
reasonably be expected to become an actual or matured liability.


 


“Specified Obligations” means Obligations
consisting of the principal of and interest on the Loans, reimbursement
obligations in respect of LC Disbursements and fees payable hereunder to the
Revolving Lenders.


 


“Spot Rate” means, with respect to any foreign exchange
computation in respect of any Offshore Currency or, with respect to a Letter of
Credit, other non-Dollar currency, the rate quoted by the Administrative Agent
in accordance with its customary procedures as the spot rate for the purchase
by Administrative Agent of Dollars with such currency or the purchase by
Administrative Agent of such Offshore Currency with Dollars, as the case may
be, through its FX Trading Office at (i) 10:30 A.M. (London time) with respect
to quotations in respect of Sterling, (ii) 10:30 A.M. (Sydney time) with
respect to quotations in respect of ADollars, (iii) 10:30 A.M. (Milan or London
time, as applicable) with respect to quotations in respect of the Euro, (iv)
10:30 A.M. (Toronto time) with respect to quotations in respect of Canadian
Dollars, and (v) 10:30 A.M. (local time in the applicable jurisdiction as
determined by the Administrative Agent) with respect to quotations in any other
non-Dollar currency, in each case on such date as of which the applicable
foreign exchange computation is made for delivery two Offshore Banking Days
later.


 


“Standby Letter of Credit” means any standby letter of credit
or similar instrument issued for the purpose of supporting (i) Indebtedness
incurred by any Foreign Subsidiary or Foreign Entity or any Joint Venture to
which Holdings or any of its Subsidiaries is a party for working capital and
general business purposes, (ii) obligations of Holdings or any of its
Subsidiaries with respect to capital calls or similar requirements in respect
of Joint Ventures to which Holdings or such Subsidiary is a party,
(iii) workers compensation liabilities of Holdings or any of its
Subsidiaries, (iv) the obligations of third party insurers of Holdings or any
of its Subsidiaries arising by virtue of the laws of any jurisdiction requiring
third party insurers,


 


52





















 


(v) Indebtedness of Holdings or any of its Subsidiaries in respect
of industrial revenue or development bonds or financings, (vi) obligations
with respect to leases of Holdings or any of its Subsidiaries,
(vii) obligations of Holdings or any of its Subsidiaries imposed by
statute or by a court of competent jurisdiction to post appeal bonds or other
security in connection with litigation appeals, and other performance, payment,
deposit or surety obligations of Holdings or any of its Subsidiaries, in any
such other case if required by law or governmental rule or regulation or in
accordance with custom and practice in the industry, (viii) obligations of
Owens Insurance Limited with respect to certain self insurance and reinsurance
programs, including obligations under insurance treaties, or (ix) other
obligations of Holdings or any of its Subsidiaries for which letter of credit
support would be used in the ordinary course of Holdings’ or such Subsidiary’s
business consistent with its past practices or otherwise consistent with custom
and practice in the industry.


 


“Sterling” means either Pounds or the Euro.


 


“Subordinated Indebtedness” means any
Indebtedness of Holdings or its Subsidiaries incurred from time to time which
is subordinated in right of payment to the Obligations in a manner, and
otherwise has terms and conditions (including as to amortization, covenants and
defaults), reasonably acceptable to Agents.


 


“Subsidiary” means any corporation, association or other
business entity of which more than 50% of the total voting power of shares of
stock or other ownership interests entitled (without regard to the occurrence
of any contingency) to vote in the election of directors, managers or trustees
thereof is at the time owned or controlled, directly or indirectly, by any
Person or one or more of the other Subsidiaries of that Person or a combination
thereof.  As used herein, references to “Subsidiaries”
of Company shall include the Borrowers, unless expressly specified otherwise.


 


“Subsidiary Guarantor” means any Domestic Subsidiary of
Company that executes and delivers a counterpart of the Subsidiary Guaranty.  As of the Third Restatement Date, the
Subsidiary Guarantors are set forth on Schedule 1.1B.


 


“Subsidiary Guaranty” means the Amended and Restated
Subsidiary Guaranty dated as of June 13, 2003, by and among all wholly-owned
Domestic Subsidiaries (including Packaging but excluding the Domestic Borrowers
(which have executed and delivered the Domestic Borrower Guaranty)) and the
Harbor Capital Subsidiaries, as amended by the first amendment thereto dated as
of the Second Restatement Date in the form attached hereto as Exhibit XVI,
and as supplemented hereafter under certain circumstances by certain
Subsidiaries of Company in accordance with subsection 5.9, and as such
Subsidiary Guaranty may hereafter be amended, supplemented or otherwise
modified from time to time.


 


“Synthetic Lease” means any lease of goods
or other property, whether real or personal, which is treated as an operating
lease under generally accepted accounting principles and as a loan or financing
for U.S. income tax purposes.


 


“Tax” or “Taxes” means
any present or future tax, substitute tax, levy, impost, duty, charge, fee,
deduction or withholding of any nature and whatever called, on whomsoever


 


53





















 


and wherever imposed, levied, collected, withheld or assessed by any
foreign, federal, state or local authority.


 


“Tax Transferee”
means any Person who acquires any interest in the Loans (whether or not by
operation of law) or the office to which a Lender, Arranger or Agent has
transferred its Loans for purposes of determining where the Loans are made,
accounted for or booked.


 


“Term Loan” means either a Tranche A1 Term
Loan, a Tranche B1 Term Loan, a French Tranche C1 Term Loan or French Tranche
C2 Term Loan and, if made, an Additional Term Loan or a Refinancing Term Loan,
and “Term Loans” means all such Loans
collectively.


 


“Third Restatement Date” means the date on which the
conditions to the Third Restatement Date under Section 7 of the First Amendment
are satisfied.


 


“Title Company” means, collectively, one or
more title insurance companies reasonably satisfactory to Collateral Agent.


 


“Total Utilization of
Australian Revolving Loan Commitments” means, as at any date of determination, the sum of (i) the
aggregate principal amount of all outstanding Australian Revolving Loans (other
than Australian Revolving Loans made for the purpose of (a) reimbursing
the applicable Issuing Lender for any drawing honored under any Letter of
Credit issued for the account of an Australian Offshore Borrower or (b)
repaying the Australian Overdraft Amount, in each case to the extent not yet so
applied) plus (ii) all Letter of Credit Usage by all Australian Offshore
Borrowers, plus (iii) the Dollar Equivalent of the Australian Overdraft Amount.


 


“Total Utilization of
Canadian Revolving Loan Commitments” means, as at any date of determination, the sum of (i) the
aggregate principal amount of all outstanding Canadian Revolving Loans (other
than Canadian Revolving Loans made for the purpose of repaying the Canadian
Overdraft Amount to the extent not yet so applied) plus (ii) the
Dollar Equivalent of the Canadian Overdraft Amount.


 


“Total Utilization of
Italian Revolving Loan Commitments” means, as at any date of determination, the sum of (i) the
aggregate principal amount of all outstanding Italian Revolving Loans (other
than Italian Revolving Loans made for the purpose of repaying the Italian
Overdraft Amount to the extent not yet so applied) plus (ii) the Dollar
Equivalent of the Italian Overdraft Amount.


 


“Total Utilization of Revolving Loan Commitments” means, as
at any date of determination, the sum of (i) the aggregate principal amount of
all outstanding Revolving Loans (other than Revolving Loans made for the
purpose of (a) reimbursing the applicable Issuing Lender for any drawing
honored under any Letter of Credit issued for the account of a Domestic
Borrower or (b) repaying the Domestic Overdraft Amount, in each case to the
extent not yet so applied), plus (ii) the Letter of Credit Usage by
the Domestic Borrowers plus (iii) the Domestic Overdraft Amount plus
(iv) the aggregate principal amount of all outstanding Offshore Revolving Loans
(other than Offshore Revolving Loans made for the purpose of (a) reimbursing
the applicable Issuing Lender for any drawing honored under any Letter of
Credit issued for the


 


54





















 


account of an Offshore Borrower or (b) repaying any Offshore Overdraft
Amount in each case to the extent not yet so applied) plus (v) the
Letter of Credit Usage by the Offshore Borrowers plus (vi) the Dollar
Equivalent of the Offshore Overdraft Amounts plus (vii) amounts
available under the Existing Holdings Senior Notes Redemption Sublimit plus
(viii) amounts available under any Acquisition Sublimit.


 


“Total Utilization of UK
Revolving Loan Commitments”
means, as at any date of determination, the sum of (i) the aggregate principal
amount of all outstanding UK Revolving Loans (other than UK Revolving Loans
made for the purpose of repaying the UK Overdraft Amount to the extent not yet
so applied) plus (ii) the Dollar Equivalent of the UK Overdraft
Amount.


 


“Tranche A
Term Loans” means the Tranche A Term Loans made by Lenders to
ACI pursuant to subsection 2.1A(i) of the First Amended and Restated
Credit Agreement.


 


“Tranche A1 and B1  Co-Syndication Agent” has the meaning assigned to that term in
the introduction to this Agreement.


 


“Tranche A1
Lender” means a Lender that has Tranche A1 Term Loan
Exposure.


 


“Tranche A1
Term Loan Exposure” means, with respect to any Lender as of
any date of determination, the outstanding principal amount of the
Tranche A1 Term Loan of that Lender.


 


“Tranche A1 Term Loan Maturity Date” means April 1, 2007.


 


“Tranche A1
Term Loan Notes” means the promissory notes of ACI issued
pursuant to subsection 2.1G to evidence the Tranche A1 Term Loans of any
Lenders, substantially in the form of Exhibit IV-A annexed hereto,
as they may be amended, supplemented or otherwise modified from time to time.


 


“Tranche A1
Term Loans” means the
Loans converted from Tranche A Term Loans into Tranche A1 Term Loans to ACI on
the December 2003 Amendment Effective Date pursuant to subsection 2.1A(i) of
the First Amended and Restated Credit Agreement, as amended by the December
2003 Amendment , as further amended and restated as Tranche A1 Term Loans under
the Second Amended and Restated Credit Agreement on the Second Restatement Date
and as amended and restated as Tranche A1 Term Loans hereunder on the Third Restatement
Date.


 


“Tranche B
Term Loans” means the Tranche B Term Loans made by Lenders to
Owens-Brockway pursuant to subsection 2.1A(ii) of the First Amended and
Restated Credit Agreement.


 


“Tranche B1
Lender” means a Lender that has Tranche B1 Term Loan
Exposure.


 


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“Tranche B1
Term Loan Exposure” means, with respect to any Lender as of
any date of determination, the outstanding principal amount of the
Tranche B1 Term Loan of that Lender.


 


“Tranche B1  Term Loan
Maturity Date” means April 1, 2008.


 


“Tranche B1
Term Loan Notes” means any promissory notes of Owens-Brockway
issued pursuant to subsection 2.1G to evidence the Tranche B1 Term Loans
of any Lenders, substantially in the form of Exhibit IV-B annexed
hereto, as they may be amended, supplemented or otherwise modified from time to
time.


 


“Tranche B1
Term Loans” means the
Loans converted from Tranche B Term Loans into Tranche B1 Term Loans to
Owens-Brockway on the December 2003 Amendment Effective Date pursuant to
subsection 2.1A(ii) of the First Amended and Restated Credit Agreement, as
amended by the December 2003 Amendment, as amended and restated as Tranche B1
Term Loans under the Second Amended and Restated Credit Agreement on the Second
Restatement Date and as amended and restated as Tranche B1 Term Loans hereunder
on the Third Restatement Date.


 


“Tranche C Term Loan Lender” means any of the French Tranche C1
Term Loans Lenders and French Tranche C2 Term Loan Lenders, and collectively,
the “Tranche C Term Loan Lenders.”


 


“Tranche C Term Loans” means the French Tranche C1 Term Loans
and the French Tranche C2 Term Loans, collectively.


 


“Tranche C Term Loan Maturity Date” means April 1, 2008.


 


“Triggering Asset Sale” means an Asset Sale
that generates Net Asset Sale Proceeds equal to or in excess of $25,000,000.


 


“2003 Additional Asbestos Reserve” means an unfunded
$450,000,000 increase made as of December 31, 2003 in the reserve for claims of
persons against Holdings for exposure to asbestos-containing products and
expenses related thereto.


 


“Type” means (i) with respect to a Commitment other than an
Offshore Revolving Loan Commitment, a Revolving Loan Commitment, (ii) with
respect to an Offshore Revolving Loan Commitment, (a) a UK Revolving Loan
Commitment, (b) an Australian Revolving Loan Commitment, (c) a Canadian
Revolving Loan Commitment or (d) an Italian Revolving Loan Commitment,
(iii) with respect to a Loan other than an Offshore Revolving Loan, (a) a
Tranche A1 Term Loan, (b) a Tranche B1 Term Loan, (c) a French Tranche C1
Term Loan, (d) a French Tranche C2 Term Loan, or (e) a Revolving Loan, and
(iv) with respect to an Offshore Revolving Loan, (a) a UK Revolving Loan,
(b) an Australian Revolving Loan, (c) a Canadian Revolving Loan, or (d) an
Italian Revolving Loan.


 


“UK”
means the United Kingdom of Great Britain and Northern Ireland.


 


56





















 


“UK Administrative Agent” has the meaning
assigned to that term in the introduction to this Agreement and also includes
any successor UK Administrative Agent appointed pursuant to subsection 8.6.


 


“UK Funding and Payment Office” means the
office of UK Administrative Agent located in London, England.


 


“UK Lending Office” means, with respect to
any Lender having a Revolving Loan Commitment, the office of such Lender, or
any Affiliate of such Lender, specified as its “UK Lending Office” on the
signature pages hereof or the applicable Assignment and Acceptance, or such
other office of such Lender or any of its Affiliates as such Lender may from
time to time specify to Borrowers’ Agent, Administrative Agent and UK
Administrative Agent.


 


“UK Offshore Borrower Cross Guaranty” means
that certain guaranty executed by United Glass in connection with the Original
Credit Agreement as the same was amended, amended and restated, or otherwise modified
in connection with the First Restatement Date and the Second Restatement Date and
as the same may be amended, amended and restated, or otherwise modified in
connection with Third Restatement Date so as to provide for United Glass’
guaranty of all Loans to the other Offshore Borrowers.


 


“UK Overdraft Account” means the account established by
United Glass with UK Overdraft Account Provider and referenced in the UK
Overdraft Agreement.


 


“UK Overdraft Account Provider” means Bank One, NA (London
Branch) or any successor UK Overdraft Account Provider pursuant to
subsection 10.2E; provided, however, that no such Lender
shall be UK Overdraft Account Provider until United Glass and such Lender have
executed and delivered a UK Overdraft Agreement to Administrative Agent.


 


“UK Overdraft Agreement” means the Offshore Overdraft
Agreement by and between United Glass and UK Overdraft Account Provider dated
as of November 20, 2003, and any successor Offshore Overdraft Agreement
executed and delivered by United Glass and any successor UK Overdraft Account
Provider pursuant to subsection 10.2E, in substantially the form of Exhibit
VIII annexed hereto, with such modifications thereto as may be approved by
Administrative Agent, as any such Offshore Overdraft Agreement may hereafter be
amended, amended and restated, supplemented or otherwise modified from time to
time in accordance with the terms thereof and hereof.


 


“UK Overdraft Amount” means, as at any date of determination,
the aggregate principal amount of outstanding overdrafts charged to the UK
Overdraft Account.


 


“UK Revolving Loan
Commitment” means the commitment of a Lender to make UK Revolving
Loans to United Glass pursuant to subsection 2.1C, and “UK Revolving Loan Commitments” means such commitments of all
Lenders in the aggregate.


 


“UK Revolving Loan Exposure”
means, with respect to any Lender as of any date of determination
(i) prior to the termination of the Revolving Loan Commitments, that
Lender’s UK Revolving Loan Commitment, and (ii) after the termination of
the Revolving Loan Commitments, the sum of (a) the aggregate outstanding
principal amount of the UK Revolving


 


57





















 


Loans of that Lender plus (b) in the case of UK
Overdraft Account Provider, the Dollar Equivalent of UK Overdraft Amount (net
of any participations therein purchased by other Lenders) plus (e) the
Dollar Equivalent of the aggregate amount of all participations purchased by
that Lender in the UK Overdraft Amount.


 


“UK Revolving Loans” means the Loans made by Lenders to
United Glass pursuant to subsection 2.1C.


 


“Unfunded Pension Liability” means, with respect to any
Pension Plan, the amount of unfunded benefit liabilities of such Pension Plan
as defined in Section 4001(a)(18) of ERISA.


 


“United Glass”
has the meaning assigned to that term in the introduction to this Agreement.


 


“Weighted Average Life to Maturity” means,
when applied to any Indebtedness at any date, the number of years obtained by
dividing (a) the then outstanding principal amount of such indebtedness into
(b) the total of the products obtained by multiplying (x) the number of each
then remaining installment, sinking fund, serial maturity or other required
payment of principal, including payment at final maturity, in respect thereof
by (y) the number of years (calculated to the nearest one-twelfth) that will
elapse between such date and the making of such payment.


 


“Wholly-Owned Subsidiary” with respect to
any Person, means any corporation, partnership, trust, limited liability
company, association or other business entity of which 100% of the total voting
power of shares of stock or other ownership interests entitled (without regard
to the occurrence of any contingency) to vote in the election of the Governing
Body is at the time owned or controlled, directly or indirectly, by that Person
or one or more of the other Wholly-Owned Subsidiaries of that Person (other
than any directors’ qualifying shares or nominee shares); provided that Avir
shall be deemed a Wholly-Owned Subsidiary of OI Italia S.R.L., VMC shall be
deemed to be a Wholly-Owned Subsidiary of BSN and BSN Glasspack GmbH & Co.
KG shall be deemed to be a Wholly-Owned Subsidiary of BSN Glasspack
Beteiligungs Verwaltungs GmbH.


 


1.2          Accounting
Terms; Utilization of GAAP for Purposes of Calculations Under Agreement;
Change in Accounting Principles.


 


Except
as otherwise expressly provided in this Agreement, all accounting terms not
otherwise defined herein shall have the meanings assigned to them in conformity
with GAAP as in effect from time to time, and all calculations in connection
with the financial covenants, standards or terms found in Section 1, Section 5
and Section 6 hereof (collectively, “Calculations”)
shall utilize accounting principles and policies in conformity with GAAP as in
effect from time to time; provided that, in the event there is a change
in accounting principles and policies that would result in a change in the
method of performing any Calculations as described in subsection 10.9,
such change shall not be given effect for purposes of any Calculations until
such time as Company and Lenders complete the negotiations provided for in
subsection 10.9.  Financial
statements and other information required to be delivered by any


 


58
















 


Loan Party to Lenders pursuant to clauses (i), (ii)
and (x) of subsection 5.1 shall be prepared in accordance with GAAP as in
effect at the time of such preparation (and, if necessary, delivered together
with the written statements provided for in subsection 5.1(iv)).  Notwithstanding the foregoing, for any period
or portion thereof during which the operations of Owens-Brockway Plastic
Products, Inc., its Subsidiaries and any other Released Guarantor or Subsidiary
thereof are classified as “discontinued operations” under GAAP as a result of
the execution of the Plastics Sale Agreement (any such classification being a “Discontinued Operations Classification”), the Consolidated
Fixed Charge Coverage Ratio, the Consolidated Leverage Ratio, the Consolidated
Senior Secured Leverage Ratio, Consolidated Capital Expenditures and
Consolidated Excess Cash Flow (including definitions utilized in calculating
same, including, without limitation, Consolidated Net Income, Consolidated
Adjusted EBITDA, Consolidated Interest Expense, Consolidated Cash Flow
Available for Fixed Charges, Consolidated Fixed Charges and the Consolidated
Working Capital Adjustment) shall be calculated without giving effect to such
Discontinued Operations Classification.


 


1.3          Other Definitional Provisions;
Anniversaries.


 


References
to “Sections” and “subsections” shall be to Sections and subsections,
respectively, of this Agreement unless otherwise specifically provided.  Any of the terms defined in
subsection 1.1 may, unless the context otherwise requires, be used in the
singular or the plural depending on the reference.  For purposes of this Agreement, a monthly
anniversary of a specified date shall occur on the same day of the applicable
month as the day of the month on which such date occurred; provided that
if there is no numerically corresponding day in the applicable month to the day
of the month on which such date occurred, the monthly anniversary of such date
shall be the last day of the applicable month.


 


1.4          Amendment and Restatement.


 


On the
Third Restatement Date, the Second Amended and Restated Credit Agreement shall
be amended and restated in its entirety, and the Revolving Loan Commitments
and/or Revolving Loans and/or Australian Revolving Loans, Tranche A1 Term
Loans, Tranche B1 Term Loans, French Tranche C1 Term Loans, and French Tranche
C2 Term Loans thereunder shall be continued under and governed by the terms of
this Agreement all as more particularly described herein.  From and after the Third Restatement Date,
the Lenders are not subject to or bound by any of the terms or provisions of
the Second Amended and Restated Agreement. 
The parties acknowledge and agree that this Agreement and the other Loan
Documents do not constitute a novation, payment and reborrowing or termination
of the obligations under the Second Amended and Restated Credit Agreement and
that all such obligations are in all respects continued and outstanding as
obligations under this Agreement and the Notes with only the terms being
modified from and after the Third Restatement Date as provided in this
Agreement, the Notes and the other Loan Documents.


 


59
















 


SECTION 2


 


AMOUNT AND TERMS OF COMMITMENTS AND LOANS; NOTES


 


2.1          Commitments; Making of Loans; Domestic Overdraft Account;
Offshore Overdraft Accounts.


 


A.    Term Loan and Revolving Loan Commitments.  Subject to the terms and conditions of this
Agreement and in reliance upon the representations and warranties of Borrowers
herein set forth, each Lender hereby severally agrees to maintain the Loans
described in subsections 2.1A(i), 2.1A(ii), 2.1A(iii) and 2.1(A)(iv), and
maintain (to the extent outstanding) and make the Loans described in subsection
2.1A(v).


 


(i)            Tranche A1 Term
Loans.  On the Third Restatement
Date, the “Tranche A1 Term Loans” outstanding under the Second Amended and
Restated Credit Agreement are hereby maintained and continued as Tranche A1
Term Loans outstanding to ACI hereunder. 
As of the Third Restatement Date, the aggregate principal amount of
Tranche A1 Term Loans hereunder is $380,000,000.  The Tranche A1 Term Loans mature on the
Tranche A1 Term Loan Maturity Date, and all Tranche A1 Term Loans and all other
amounts owed hereunder with respect to the Tranche A1 Term Loans shall be paid
in full no later than that date.  Tranche
A1 Term Loans repaid or prepaid may not be reborrowed.


 


(ii)           Tranche B1 Term
Loans.  On the Third Restatement
Date, the “Tranche B1 Term Loans” outstanding under the Second Amended and
Restated Credit Agreement are hereby maintained and continued as Tranche B1
Term Loans outstanding to Owens-Brockway hereunder.  As of the Third Restatement Date, the
aggregate principal amount of Tranche B1 Term Loans hereunder is
$275,000,000.  The Tranche B1 Term Loans
mature on the Tranche B1 Term Loan Maturity Date, and all Tranche B1 Term Loans
and all other amounts owed hereunder with respect to the Tranche B1 Term Loans
shall be paid in full no later than that date. 
Tranche B1 Term Loans repaid or prepaid may not be reborrowed.


 


(iii)          French Tranche C1
Term Loans.  On the Third Restatement
Date, the “French Tranche C1 Term Loans” outstanding under the Second Amended
and Restated Credit Agreement are hereby maintained and continued as French
Tranche C1 Term Loans outstanding to BSN hereunder.  As of the Third Restatement Date, the
aggregate principal amount of French Tranche C1 Term Loans hereunder is
$230,000,000.  The French Tranche C1 Term
Loans mature on the Tranche C Term Loan Maturity Date, and all French Tranche
C1 Term Loans and all other amounts owed hereunder with respect to the French
Tranche C1 Term Loans shall be paid in full no later than that date.  French Tranche C1 Term Loans repaid or
prepaid may not be reborrowed.


 


(iv)          French Tranche C2
Term Loans.  On the Third Restatement
Date, the “French Tranche C2 Term Loans” outstanding under the Second Amended
and Restated Credit Agreement are hereby maintained and continued as French
Tranche C2 Term Loans outstanding to BSN hereunder.  As of the Third Restatement Date, the
aggregate principal amount of French Tranche C2 Term Loans hereunder is
€52,000,000.  The French Tranche C2 Term
Loans mature on the Tranche C Term Loan Maturity Date, and all French Tranche
C2


 


60
















 


Term Loans and all other
amounts owed hereunder with respect to the French Tranche C2 Term Loans shall
be paid in full no later than that date. 
French Tranche C2 Term Loans repaid or prepaid may not be reborrowed.


 


(v)           Revolving Loans.  On the Third Restatement Date, “Revolving
Loans” outstanding and “Revolving Loan Commitments” under the Second Amended
and Restated Credit Agreement are hereby continued as outstanding Revolving
Loans and Revolving Loan Commitments hereunder, respectively.  From and after the Third Restatement Date,
each Lender with a Revolving Loan Commitment hereby severally agrees, subject
to the limitations set forth below with respect to the maximum amount of
Revolving Loans permitted to be outstanding from time to time, to make
Revolving Loans in Dollars to the Domestic Borrowers from time to time during
the period from and including the Third Restatement Date to but excluding the
Revolving Loan Commitment Termination Date in an aggregate amount in Dollars at
any one time outstanding not exceeding its Pro Rata Share of the aggregate
amount of the Revolving Loan Commitments to be used for the purposes and
subject to the limitations identified in subsection 2.5A.  The amount of each Revolving Lender’s
Revolving Loan Commitment is set forth opposite its name on Schedule A
annexed hereto and the aggregate amount of the Revolving Loan Commitments as of
the Third Restatement Date is $600,000,000; 
provided, that the Revolving Loan Commitments of Lenders shall be
adjusted to give effect to any assignments of the Revolving Loan Commitments
pursuant to subsection 10.2; and provided, further that the
amount of the Revolving Loan Commitments shall be reduced from time to time by
the amount of any reductions thereto made pursuant to subsection 2.4.  In no event shall the aggregate principal
amount of the Revolving Loans to the Domestic Borrowers from any Lender outstanding
at any time exceed its Revolving Loan Commitment then in effect.  Each Lender’s Revolving Loan Commitment shall
expire on the Revolving Loan Commitment Termination Date and all Revolving
Loans and all other amounts owed hereunder with respect to the Revolving Loans
and the Revolving Loan Commitments shall be paid in full no later than that
date.  Amounts borrowed under this
subsection 2.1A(v) may be repaid and reborrowed to but excluding the
Revolving Loan Commitment Termination Date.


 


Anything
contained in this Agreement to the contrary notwithstanding, the Revolving
Loans and the Revolving Loan Commitments shall be subject to the limitation
that in no event shall (i) the Total Utilization of Revolving Loan
Commitments at any time exceed (ii) the Revolving Loan Commitments then in
effect.


 


Revolving
Loans (other than (y) Revolving Loans made for the purpose of reimbursing any
Issuing Lender for the amount of a drawing honored under a Letter of Credit
issued by it, which shall be in the amount of such drawing so honored, or (z)
Revolving Loans made for the purpose of repaying the Domestic Overdraft Amount,
which shall be in an amount equal to the Domestic Overdraft Amount) made on any
Funding Date shall be in an aggregate minimum amount of $5,000,000 and integral
multiples of $1,000,000, in excess of that amount.


 


(vi)          Additional Term Loans.  (a) Owens-Brockway shall have the right at
any time (so long as (x) no Potential Event of Default or Event of Default then
exists and (y) Borrowers’ Agent shall have delivered to Administrative Agent a
Compliance Certificate for the period of four full Fiscal Quarters immediately
preceding the incurrence described below (prepared in good faith and in a
manner consistent with the requirements of clause (b) of


 


61
















 


subsection  5.1(iii) giving pro forma effect
to such incurrence and evidencing compliance with the covenants referred to in
such Compliance Certificate and a Consolidated Senior Secured Leverage Ratio on
a pro forma basis of not more than 2.85:1.00 as of the last day
of such period), and from time to time after the Third Restatement Date to
incur from one or more existing Lenders and/or other Persons that are Eligible
Assignees and which, in each case, agree to make such loans to Owens-Brockway,
loans and commitments to make loans in an aggregate principal amount not to
exceed $300,000,000 which loans may be incurred as one or more tranches of
additional term loans (the “Additional Term
Loans”) as determined by Administrative Agent that are pari passu
in all respects to the Tranche B1 Term Loans under a facility that would
provide that the Additional Term Loans would have a Weighted Average Life to
Maturity of not less than the Tranche B1 Term Loans and a final maturity no
earlier than Tranche B1 Term Loan Maturity Date; provided, that (i) the
terms and conditions of any Additional Term Loans shall be substantially
similar to those applicable to the Tranche B1 Term Loans and (ii) the
applicable margins (which, for such purposes only, shall be deemed to include all
upfront or similar fees or original issue discount (amortized over the life of
such loan) payable to all Lenders providing such Additional Term Loans, but
exclusive of any arrangement, structuring or other fees payable in connection
therewith that are not shared with all Lenders providing such Additional Term
Loans) determined as of the initial funding date for such Additional Term Loans
shall not be greater than 0.50% above the applicable margins then in effect for
Tranche B1 Term Loans (which, for such purposes only, shall be deemed to
include all upfront or similar fees or original issue discount (amortized over
the life of such loan) paid to all Lenders of Tranche B1 Term Loans as of the
initial funding date for such Additional Term Loans, but exclusive of any
arrangement, structuring or other fees payable in connection therewith that are
not shared with all Lenders of Tranche B1 Term Loans).


 


(b)           In the event that
Owens-Brockway desires to incur Additional Term Loans, Owens-Brockway will
enter into an amendment with the lenders (which shall upon execution thereof
become Lenders hereunder if not theretofore Lenders) to provide for such
Additional Term Loans, which amendment shall set forth any terms and conditions
of the Additional Term Loans not covered by this Agreement as agreed by
Owens-Brockway and such Lenders, and shall provide for the issuance of
promissory notes to evidence the Additional Term Loans if requested by the
lenders advancing Additional Term Loans (which notes shall constitute Notes for
purposes of this Agreement), with such amendment to be in form and substance
reasonably acceptable to Administrative Agent and consistent with the terms of
this subsection 2.1A(vi) and of the other provisions of this Agreement.  No consent of any Lender (other than any
Lender making Additional Term Loans) is required to permit the Loans
contemplated by this subsection 2.1A(vi) or the aforesaid amendment to
effectuate the Additional Term Loans. 
This section shall supersede any provisions contained in this Agreement,
including, without limitation, subsection 10.7 and references in
subsection 10.7 to “subsection 2.1A(iv)” shall be deemed to refer to this
section.


 


(vii)         Refinancing Term Loans.
(a) Owens-Brockway, ACI and BSN shall have the right at any time (so long as
(x) no Potential Event of Default or Event of Default then exists and (y)
Borrowers’ Agent shall have delivered to Administrative Agent a Compliance
Certificate for the period of four full Fiscal Quarters immediately preceding
the incurrence described below (prepared in good faith and in a manner
consistent with the requirements of clause (b) of subsection
5.1(iii) giving pro forma effect to such incurrence and evidencing


 


62
















 


compliance with the covenants referred to in such
Compliance Certificate), to incur from one or more existing Lenders and/or
other Persons that are Eligible Assignees and which, in each case, agree to
make such loans to Owens-Brockway, ACI or BSN, as applicable, loans and commitments
to make loans (the “Refinancing Term Loans”)
in an aggregate principal amount not to exceed the aggregate amount of Tranche
A1 Term Loans (in the case of ACI), Tranche B1 Term Loans and “Domestic Tranche
C Term Loans” made under the Second Amended and Restated Credit Agreement (in
the case of Owens-Brockway) and French Tranche C1 Term Loan and French Tranche
C2 Term Loans (in the case of BSN) theretofore made to such Borrower and
thereafter repaid (or to be repaid with the proceeds of such Refinancing Term
Loans). Refinancing Term Loans may be incurred as one or more tranches (of at
least $100,000,000 each) of Refinancing Term Loans as determined by Agents that
are pari  passu in all respects with, have a Weighted Average Life
to Maturity of not less than, have a final maturity no earlier than and shall
otherwise be (except as to pricing) on terms and conditions substantially
similar to the Type of Term Loan such tranche of Refinancing Term Loans is to
replace or refinance.


 


(b)           In the event that Owens-Brockway,
ACI or BSN desires to incur Refinancing Term Loans, Owens-Brockway, ACI or BSN,
as applicable, will enter into an amendment with the lenders (which shall upon
execution thereof become Lenders hereunder if not theretofore Lenders) to
provide for such Refinancing Term Loans, which amendment shall set forth any
terms and conditions of the Refinancing Term Loans not covered by this
Agreement as agreed by Owens-Brockway, ACI or BSN, as applicable, and such
Lenders, and shall provide for the issuance of promissory notes to evidence the
Refinancing Term Loans if requested by the lenders advancing Refinancing Term
Loans (which notes shall constitute Notes for purposes of this Agreement), with
such amendment to be in form and substance reasonably acceptable to Agents and
consistent with the terms of this subsection 2.1A(vii) and of the other
provisions of this Agreement.  No consent
of any Lender (other than any Lender making Refinancing Term Loans) is required
to permit the Loans contemplated by this subsection 2.1A(vii) or the
aforesaid amendment to effectuate the Refinancing Term Loans.  This section shall supersede any provisions
contained in this Agreement, including, without limitation, subsection 10.7.


 


B.    Domestic
Overdraft Account.  Lenders agree that Domestic Borrowers and
Administrative Agent may establish and maintain the Domestic Overdraft Account
to be established pursuant to the Domestic Overdraft Agreement; provided
that (i) the Domestic Overdraft Amount shall not exceed at any time
$50,000,000, and (ii) in no event shall the Total Utilization of Revolving
Loan Commitments at any time exceed the Revolving Loan Commitments then in
effect.  Notwithstanding anything
contained in this Agreement to the contrary (but subject, however, to the limitations
set forth in subsection 2.1A(v) with respect to the making of Revolving
Loans), Lenders and Domestic Borrowers further agree that Administrative Agent
at any time in its sole and absolute discretion may, upon notice to the
Domestic Borrowers and Revolving Lenders, require each Revolving Lender
(including Administrative Agent) on one Business Day’s notice to make a
Revolving Loan on behalf of the Domestic Borrowers in an amount equal to that
Lender’s Pro Rata Share, or, in the sole and absolute discretion of
Administrative Agent, require each other Revolving Lender to purchase a
participation in amounts due with respect to the Domestic Overdraft Amount in
an amount equal to that Lender’s Pro Rata Share of the Domestic Overdraft
Amount; provided, however, that the obligation of each such
Lender to make each such Revolving Loan on behalf of the Domestic Borrowers or
to purchase each such participation in the Domestic Overdraft Amount is subject
to


 


63
















 


the condition that at the time such extension of
credit under the Domestic Overdraft Agreement was made the duly authorized
officer of Administrative Agent responsible for the administration of
Administrative Agent’s credit relationship with Domestic Borrowers believed in
good faith that (x) no Event of Default had occurred and was continuing or
(y) any Event of Default that had occurred and was continuing had been
waived by Requisite Lenders (or, if applicable under subsection 10.7, all
Lenders) at the time such extension of credit under the Domestic Overdraft
Agreement was made.  In the case of
Revolving Loans made by Lenders other than Administrative Agent under the
immediately preceding sentence, each such Lender shall make the amount of its
Revolving Loan available to Administrative Agent, in Same Day Funds, at the
Domestic Funding and Payment Office not later than 1:00 P.M. (New York
time) on the Business Day next succeeding the date such notice is given.  The proceeds of such Revolving Loans shall be
immediately delivered to Administrative Agent (and not to any Domestic Borrower
or any other Loan Party) and applied to repay the Domestic Overdraft
Amount.  On the day such Revolving Loans
are made, Administrative Agent’s Pro Rata Share of the Domestic Overdraft
Amount being refunded shall be deemed to be paid with the proceeds of a
Revolving Loan made by Administrative Agent and such portion of the Domestic
Overdraft Amount deemed to be so paid shall no longer be outstanding.  Each Domestic Borrower authorizes
Administrative Agent to charge the Domestic Borrower’s accounts with
Administrative Agent (up to the amount available in each such account) in order
to immediately pay Administrative Agent the amount of the Domestic Overdraft
Amount to be refunded in such order as Administrative Agent may elect,
regardless of whether such amounts were drawn on behalf of such Domestic
Borrower or another Domestic Borrower, to the extent amounts received from
Lenders, including amounts deemed to be received from Administrative Agent, are
not sufficient to repay in full the Domestic Overdraft Amount to be refunded
and provided  further that Administrative Agent shall give
Domestic Borrowers notice of such charges prior thereto or as soon as
reasonably practicable thereafter.  Each
Revolving Loan made in accordance with the foregoing shall be made as a Base
Rate Loan.  If any portion of any such
amount paid to Administrative Agent should be recovered by or on behalf of any
Domestic Borrower from Administrative Agent in bankruptcy, by assignment for
the benefit of creditors or otherwise, the loss of the amount so recovered
shall be ratably shared among all Revolving Lenders in the manner contemplated
by subsection 10.6.  In the event
that Administrative Agent requires the other Revolving Lenders to purchase
participations in the Domestic Overdraft Amount, payment for such
participations shall be made directly to Administrative Agent at the Domestic
Funding and Payment Office not later than 1:00 P.M. (New York time) on the
Business Day next succeeding the date notice to purchase such participations is
given.  Except as provided above in this
subsection 2.1B and except for the satisfaction of the conditions
specified in subsection 3.1 and 3.2, each Lender’s obligation to make
Revolving Loans pursuant to this subsection 2.1B and to purchase
participations in the Domestic Overdraft Amount pursuant to this
subsection 2.1B shall be absolute and unconditional and shall not be
affected by any circumstance, including, without limitation, (i) any
set-off, counterclaim, recoupment, defense or other right which such Lender may
have against Administrative Agent, any Loan Party or any other Person for any
reason whatsoever; (ii) the occurrence or continuance of an Event of
Default or a Potential Event of Default; (iii) any adverse change in the
condition (financial or otherwise) of any Loan Party; (iv) any breach of
this Agreement by any Loan Party or any other Revolving Lender; or (v) any
other circumstance, happening, or event whatsoever, whether or not similar to
any of the foregoing; provided that in the event that the obligations of
Lenders to make Revolving Loans


 


64
















 


are terminated in accordance with Section 7, Lenders
having a Revolving Loan Commitment shall thereafter only be obligated to
purchase participations in the Domestic Overdraft Amount as provided in this
subsection 2.1B.  In the event that
any Lender fails to make available to Administrative Agent the amount of any of
such Lender’s Revolving Loans required to be made pursuant to this
subsection 2.1B or the amount of any participations in the Domestic
Overdraft Amount which are required to be purchased from Administrative Agent
by such Lender pursuant to this subsection 2.1B, Administrative Agent
shall be entitled to recover such amount on demand from such Lender together
with interest at the customary rate set by Administrative Agent for the
correction of errors among banks for three Business Days and thereafter at the
Base Rate.  Nothing in this
subsection 2.1B shall be deemed to prejudice the right of any Lender to
recover from Administrative Agent any amounts made available by such Lender to
Administrative Agent pursuant to this subsection 2.1B in respect of any
extension of credit by Administrative Agent under the Domestic Overdraft
Agreement in the event that it is determined by a court of competent
jurisdiction that such extension of credit by Administrative Agent constituted
gross negligence or willful misconduct on the part of Administrative Agent.


 


Any
notice given by Administrative Agent to Lenders pursuant to the immediately
preceding paragraph shall be concurrently given by Administrative Agent to
Domestic Borrowers or Borrowers’ Agent.


 


C.    Offshore
Revolving Loan Commitments.  On the Third Restatement Date,
“Offshore Revolving Loans” outstanding and “Offshore Revolving Loan
Commitments” under the Second Amended and Restated Credit Agreement are hereby
continued as outstanding Offshore Revolving Loans in Dollars and Offshore Revolving
Loan Commitments hereunder, respectively. 
Subject to the terms
and conditions of this Agreement and in reliance upon the representations and
warranties of Borrowers herein set forth, each Offshore Borrower may request,
in accordance with the provisions of this subsection 2.1C, that Lenders
with a Revolving Loan Commitment make Offshore Revolving Loans.  The making of Offshore Revolving Loans shall
reduce the availability of Revolving Loans to Domestic Borrowers on a
dollar-for-dollar basis to the extent of Offshore Revolving Loans
outstanding.  Subject to the limitations
set forth below, (a) each Revolving Lender hereby severally agrees to make UK
Revolving Loans to United Glass in Dollars from time to time during the period
from and including the Third Restatement Date to but excluding the Revolving
Loan Commitment Termination Date in an aggregate amount at any time outstanding
not exceeding its Pro Rata Share of the aggregate amount of the UK Revolving
Loan Commitments; provided, however, Lenders shall not be
obligated to make UK Revolving Loans (and United Glass may not request any such
Loans) at any time a UK Overdraft Agreement is in effect, except to repay the
UK Overdraft Amount upon notice from the UK Overdraft Account Provider pursuant
to subsection 2.1D(ii), (b) each Revolving Lender hereby severally agrees,
subject to the limitations set forth below with respect to the maximum amount
of Offshore Revolving Loans and Australian Revolving Loans permitted to be
outstanding from time to time, to make Australian Revolving Loans to any of the
Australian Offshore Borrowers in Dollars from time to time during the period
from and


 


65
















 


including the Third Restatement Date to but excluding
the Revolving Loan Commitment Termination Date, in an aggregate amount at any
time outstanding with respect to all Australian Offshore Borrowers not
exceeding its Pro Rata Share of the aggregate amount of the Australian
Revolving Loan Commitments, (c) each Revolving Lender hereby severally agrees
to make Canadian Revolving Loans to O-I Canada in Dollars from time to time
during the period from and including the Third Restatement Date to but
excluding the Revolving Loan Commitment Termination Date in an aggregate amount
at any time outstanding not exceeding its Pro Rata Share of the aggregate
amount of the Canadian Revolving Loan Commitments, provided, however,
Lenders shall not be obligated to make Canadian Revolving Loans (and O-I Canada
may not request any such Loans) at any time a Canadian Overdraft Agreement is
in effect, except to repay the Canadian Overdraft Amount upon notice from the
Canadian Overdraft Account Provider pursuant to subsection 2.1D(ii), and
(d) each Revolving Lender hereby severally agrees, subject to the limitations
set forth below with respect to the maximum amount of Offshore Revolving Loans
and Italian Revolving Loans permitted to be outstanding from time to time, to
make Italian Revolving Loans to Avir in Dollars from time to time during the
period from and including the Third Restatement Date to but excluding the
Revolving Loan Commitment Termination Date in an aggregate amount at any time
outstanding not exceeding its Pro Rata Share of the aggregate amount of the
Italian Revolving Loan Commitments; provided, however, Lenders
shall not be obligated to make Italian Revolving Loans (and Avir may not
request any such Loans) at any time an Italian Overdraft Agreement is in
effect, except to repay the Italian Overdraft Amount upon notice from the
Italian Overdraft Account Provider pursuant to subsection 2.1D(ii).  The proceeds of all such Offshore Revolving
Loans shall be used for the purposes identified in subsection 2.5A.  The amount of each Lender’s UK Revolving Loan
Commitment, each Lender’s Australian Revolving Loan Commitment, each Lender’s
Canadian Revolving Loan Commitment and each Lender’s Italian Revolving Loan
Commitment in each case as of the Third Restatement Date is set forth opposite
its name in Schedule A annexed hereto and the aggregate amounts of
the (i) UK Revolving Loan Commitments, (ii) the Australian Revolving Loan
Commitments, (iii) the Canadian Revolving Loan Commitments and (iv) the Italian
Revolving Loan Commitments (in each case set forth in Schedule A) are,
as of the Third Restatement Date, (i) $20,000,000, (ii) $440,000,000, (iii)
$10,000,000 and (iv) $63,000,000, respectively; provided that the
Offshore Revolving Loan Commitments of Lenders shall be adjusted to give effect
to any assignments thereof pursuant to subsection 10.2; provided, further
that the amount of any Offshore Revolving Loan Commitment shall be reduced from
time to time by the amount of any reductions thereto made pursuant to
subsection 2.4G.  In no event shall
the aggregate principal amount of the UK Revolving Loans of any Lender
outstanding at any time exceed its UK Revolving Loan Commitment then in effect,
in no event shall the aggregate principal amount of the Australian Revolving
Loans of any Lender outstanding at any time exceed its Australian Revolving
Loan Commitment then in effect, in no event shall the aggregate principal
amount of Canadian Revolving Loans of any Lender outstanding at any time exceed
its Canadian Revolving Loan Commitment then in effect and in no event shall the
aggregate principal amount of the Italian Revolving Loans of any Lender
outstanding at any time exceed its Italian Revolving Loan Commitment then in
effect.  Each Lender’s Offshore Revolving
Loan Commitment shall expire on the Revolving Loan Commitment Termination Date
and all Offshore Revolving Loans and all other amounts owed hereunder with
respect to the Offshore Revolving Loans and the Offshore Revolving Loan
Commitments shall be paid in full no later than that date.  Amounts borrowed under this
subsection 2.1C may be repaid and reborrowed to but excluding the
Revolving Loan Commitment Termination Date.


 


Anything
contained in this Agreement to the contrary notwithstanding, no Offshore
Borrower shall request Lenders to make any Offshore Revolving Loans (and no
Lender shall be obligated to make Offshore Revolving Loans) if, immediately
after giving effect to the making of such Offshore Revolving Loans:


 


66
















 


(1)   the Total Utilization of
Revolving Loan Commitments would exceed the Revolving Loan Commitments then in
effect;


 


(2)   the sum of the Total
Utilization of UK Revolving Loan Commitments plus the Total Utilization
of Australian Revolving Loan Commitments plus the Total Utilization of
the Canadian Revolving Loan Commitments plus the Total Utilization of
Italian Revolving Loan Commitments would exceed the Aggregate Offshore
Sublimit;


 


(3)   the Total Utilization of UK
Revolving Loan Commitments would exceed the UK Revolving Loan Commitments then
in effect;


 


(4)   the Total Utilization of Australian
Revolving Loan Commitments would exceed the Australian Revolving Loan
Commitments then in effect;


 


(5)   the Total Utilization of the
Canadian Revolving Loan Commitments would exceed the Canadian Revolving Loan
Commitments then in effect; or


 


(6)   the Total Utilization of
Italian Revolving Loan Commitments would exceed the Italian Revolving Loan
Commitments then in effect.


 


UK
Revolving Loans made on any Funding Date (other than UK Revolving Loans made
for the purpose of repaying the UK Overdraft Amount, which shall be in an
amount equal to the UK Overdraft Amount) shall be in an aggregate minimum
amount of $5,000,000 and integral multiples of $1,000,000 in excess of that
amount; Australian Revolving Loans made on any Funding Date (other than (y)
Australian Revolving Loans made for the purpose of reimbursing any Issuing
Lender for the amount of a drawing honored under a Letter of Credit issued by
it for the account of any Australian Borrower, which shall be in the amount of
such drawing so honored, or (z) Australian Revolving Loans made for the purpose
of repaying the Australian Overdraft Amount, which shall be in an amount equal
to the Australian Overdraft Amount) shall be in an aggregate minimum amount of
$5,000,000 and integral multiples of $1,000,000 in excess of that amount;
Canadian Revolving Loans made on any Funding Date (other than Canadian
Revolving Loans made for the purpose of repaying the Canadian Overdraft Amount,
which shall be in an amount equal to the Canadian Overdraft Amount) shall be in
an aggregate minimum amount of $5,000,000 and integral multiples of $1,000,000
in excess of that amount; and Italian Revolving Loans made on any Funding Date
(other than Italian Revolving Loans made for the purpose of repaying the
Italian Overdraft Amount, which shall be in an amount equal to the Italian
Overdraft Amount) shall be in an aggregate minimum amount of $5,000,000 and
integral multiples of $1,000,000 in excess of that amount.


 


Each
Offshore Borrower hereby unconditionally promises to pay to the Lenders the
then unpaid principal amount of each Offshore Revolving Loan of such Lender
made to such Offshore Borrower on or before the Revolving Loan Commitment
Termination Date or such earlier date on which such Offshore Revolving Loans
become due and payable pursuant to Section 7. 
Each Offshore Borrower hereby further agrees and promises to pay to the
Lenders interest on the unpaid principal amount of each Offshore Revolving Loan
of such Lender made to such Offshore Borrower from time to time outstanding
from the date hereof until paid in full,


 


67
















 


at the rates and at the times which shall be
determined in accordance with the provisions of this Agreement.


 


D.    Offshore Overdraft Accounts.


 


(i)            Lenders agree that
each Offshore Borrower may establish and maintain an Offshore Overdraft Account
with an Offshore Overdraft Provider pursuant to an Offshore Overdraft
Agreement; provided that (a) (1) the UK Overdraft Amount shall not
exceed at any time the Offshore Currency Equivalent of $20,000,000, (2) the
Australian Overdraft Amount shall not exceed at any time the Offshore Currency
Equivalent of $30,000,000, (3) the Canadian Overdraft Amount shall not exceed
at any time the Offshore Currency Equivalent of $10,000,000 and (4) the Italian
Overdraft Amount shall not exceed the Offshore Currency Equivalent of
$63,000,000, and (b) in no event shall an Offshore Borrower request an
extension of credit under an Offshore Overdraft Agreement (and no Offshore
Overdraft Account Provider shall be obligated to extend credit under an
Offshore Overdraft Agreement) if, after giving effect to such extension of
credit:


 


(1)   the Total Utilization of
Revolving Loan Commitments would exceed the Revolving Loan Commitments then in
effect;


 


(2)   the sum of the Total
Utilization of UK Revolving Loan Commitments plus the Total Utilization
of the Australian Revolving Loan Commitments plus the Total Utilization
of the Canadian Revolving Loan Commitments plus the Total Utilization of
Italian Revolving Loan Commitments would exceed the Aggregate Offshore
Sublimit;


 


(3)   the Total Utilization of UK
Revolving Loan Commitments would exceed the UK Revolving Loan Commitments then
in effect;


 


(4)   the Total Utilization of
Australian Revolving Loan Commitments would exceed the Australian Revolving
Loan Commitments then in effect;


 


(5)   the Total Utilization of
Canadian Revolving Loan Commitments would exceed the Canadian Revolving Loan
Commitments then in effect; or


 


(6)   the Total Utilization of
Italian Revolving Loan Commitments would exceed the Italian Revolving Loan
Commitments then in effect.


 


(ii)           Notwithstanding
anything contained in this Agreement to the contrary (but subject, however, to
the limitations set forth in subsection 2.1C with respect to the making of
Offshore Revolving Loans), Lenders and each Offshore Borrower further agree
that any Offshore Overdraft Account Provider at any time in its sole and
absolute discretion may, upon notice to the relevant Offshore Borrower, the
Administrative Agent and the Lenders, require each Revolving Lender (including
such Offshore Overdraft Account Provider) on one Business Day’s notice to make
an Offshore Revolving Loan in Dollars in an amount equal to that Lender’s Pro
Rata Share (determined with respect to such Type of Offshore Revolving Loan
Commitments) of the relevant Offshore Overdraft Amount (calculated in Dollars
by reference to the applicable Spot Rate on the date such Offshore Revolving
Loan is to be made) or, in the event the relevant Type of Offshore Revolving
Loan Commitment has terminated, require each


 


68
















 


Revolving Lender to purchase a participation in
amounts due with respect to the relevant Offshore Overdraft Account in an
amount equal to that Lender’s Pro Rata Share of the relevant Offshore Overdraft
Amount (calculated in Dollars by reference to the applicable Spot Rate on the
date such participation is to be purchased); provided, however,
that the obligation of each Revolving Lender to make each such Offshore
Revolving Loan or of each Revolving Lender to purchase each such participation
in any such Offshore Overdraft Amount is subject to the condition that at the
time such extension of credit under the applicable Offshore Overdraft Agreement
was made the duly authorized officer of such Offshore Overdraft Account
Provider responsible for the administration of such Offshore Overdraft Account
Provider’s credit relationship with the relevant Offshore Borrower believed in
good faith that (a) no Event of Default had occurred and was continuing or
(b) any Event of Default that had occurred and was continuing had been
waived by Requisite Lenders (or, if applicable under subsection 10.7, all
Lenders) at the time such extension of credit under such Offshore Overdraft
Agreement was made.  In the case of
Offshore Revolving Loans or participation purchases made by Lenders other than
Administrative Agent under the immediately preceding sentence, each such Lender
shall make the amount of its Offshore Revolving Loan or the amount of its
participation, as applicable, available to Administrative Agent in Same Day
Funds in Dollars, at the Domestic Funding and Payment Office not later than
12:00 Noon (New York time) on the Business Day next succeeding the date such
notice is given and upon such transfer such Offshore Revolving Loans shall be
deemed made or such participations purchased, as the case may be.  The proceeds of such Offshore Revolving Loans
or participation purchases shall be delivered by Administrative Agent to such
Offshore Overdraft Account Provider (and not to the relevant Offshore Borrower)
as soon as practicable and applied to repay the relevant Offshore Overdraft
Amount.  On the day such Offshore
Revolving Loans are made or such participations are purchased, such Offshore
Overdraft Account Provider’s Pro Rata Share of the Offshore Overdraft Amount
being refunded shall be deemed to be paid with the proceeds of an Offshore
Revolving Loan made by such Offshore Overdraft Account Provider and such
portion of the Offshore Overdraft Amount deemed to be so paid shall no longer
be outstanding.  Each Offshore Borrower
authorizes the Offshore Overdraft Account Provider to charge such Offshore
Borrower’s accounts with such Offshore Overdraft Account Provider (up to the
amount available in each such account) in order to immediately pay such
Offshore Overdraft Account Provider the amount of the Offshore Overdraft Amount
to be refunded to the extent amounts received from Lenders, including amounts
deemed to be received from such Offshore Overdraft Account Provider, are not
sufficient to repay in full the Offshore Overdraft Amount to be refunded; provided
that such Offshore Overdraft Account Provider shall give such Offshore Borrower
notice of such charges prior thereto or as soon as reasonably practicable
thereafter.  Each Offshore Revolving Loan
made in accordance with the foregoing shall be made as a Base Rate Loan.  If any portion of any such amount paid to any
Offshore Overdraft Account Provider should be recovered by or on behalf of such
Offshore Borrower from such Offshore Overdraft Account Provider in bankruptcy,
by assignment for the benefit of creditors or otherwise, the loss of the amount
so recovered shall be ratably shared among all Lenders in the manner contemplated
by subsection 10.6.


 


(iii)          Except as provided above
in this subsection 2.1D and except for the satisfaction of the conditions
specified in subsections 3.1 and 3.2, each Lender’s obligation to make Offshore
Revolving Loans pursuant to this subsection 2.1D and the obligation of
each Revolving Lender to purchase participations in any Offshore Overdraft
Amount pursuant to this


 


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subsection 2.1D shall be absolute and
unconditional and shall not be affected by any circumstance, including, without
limitation, (a) any set-off, counterclaim, recoupment, defense or other
right which such Lender may have against such Offshore Overdraft Account
Provider, any Borrower or any other Person for any reason whatsoever; (b) the
occurrence or continuance of an Event of Default or a Potential Event of
Default; (c) any adverse change in the condition (financial or otherwise)
of any Loan Party; (d) any breach of this Agreement by any Borrower or any
other Lender; or (e) any other circumstance, happening, or event
whatsoever, whether or not similar to any of the foregoing; provided
that in the event that the obligations of Lenders to make Offshore Revolving
Loans are terminated in accordance with Section 7, Revolving Lenders shall
thereafter only be obligated to purchase participations in the relevant
Offshore Overdraft Amount as provided in this subsection 2.1D.  In the event that any Lender fails to make
available to the relevant Administrative Agent the amount of any of such Lender’s
Offshore Revolving Loans required to be made pursuant to this
subsection 2.1D or to the Administrative Agent the amount of any
participations in the relevant Offshore Overdraft Amount which are required to
be purchased from such Offshore Overdraft Account Provider by such Lender
pursuant to this subsection 2.1D, such Offshore Overdraft Account Provider
shall be entitled to recover such amount on demand from such Lender together
with interest at the customary rate set by such Offshore Overdraft Account
Provider for the correction of errors among banks in the relevant jurisdiction
for three Offshore Banking Days and thereafter at the Base Rate.  Nothing in this subsection 2.1D shall be
deemed to prejudice the right of any Lender to recover from any Offshore
Overdraft Account Provider any amounts made available by such Lender to such
Offshore Overdraft Account Provider pursuant to this subsection 2.1D in
respect of any extension of credit by such Offshore Overdraft Account Provider
under the relevant Offshore Overdraft Agreement in the event that it is
determined by a court of competent jurisdiction that such extension of credit
by such Offshore Overdraft Account Provider constituted gross negligence or
willful misconduct on the part of such Offshore Overdraft Account Provider.


 


(iv)          Any notice given by any
Offshore Overdraft Account Provider to the relevant Lenders pursuant to
subsection 2.1D(iii) shall be concurrently given by such Offshore
Overdraft Account Provider to the Administrative Agent and the applicable
Offshore Borrower or Borrowers’ Agent.


 


(v)           Anything contained in
this Agreement to the contrary notwithstanding, no amendment, modification,
termination or waiver of any provision of this Agreement or of the other Loan
Documents, and no consent to any departure by any Borrower therefrom, shall
modify, terminate or waive in any manner adverse to any Offshore Overdraft
Account Provider any provision of this subsection 2.1D or any other
provision of this Agreement directly relating to the Offshore Overdraft
Accounts or the Offshore Overdraft Amounts (including any provision directly
relating to the repayment of the Offshore Overdraft Amounts with the proceeds
of Offshore Revolving Loans or directly relating to the obligations of Lenders
to purchase participations in the Offshore Overdraft Amounts) without the
written concurrence of the applicable Offshore Overdraft Account Providers.


 


E.     Notice of Borrowing.


 


(i)            Whenever a Borrower
desires that Lenders make Revolving Loans or Offshore Revolving Loans, it shall
deliver to Administrative Agent a Notice of Borrowing no


 


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later than 12:00 Noon (New York time) (x) at least one
Business Day in advance of the proposed Funding Date, in the case of any Base Rate
Loan, or (y) three Business Days in advance of the proposed Funding Date, in
the case of a Eurodollar Rate Loan (other than in respect of a UK Borrower) and
four Business Days in advance of the proposed Funding Date in the case of a
Eurodollar Rate Loan to a UK Borrower. 
The Notice of Borrowing shall specify (1) the proposed Funding Date
(which shall be a Business Day), (2) the amount and Type of the proposed
Loans, (3) whether such Loans are initially to consist of Base Rate Loans
or Eurodollar Rate Loans or a combination thereof, and (4) if such Loans,
or any portion thereof, are initially to be Eurodollar Rate Loans, the amounts
thereof and the initial Interest Periods therefor; and except as set forth in
subsection 3.2B, such Notice of Borrowing shall further certify that
subsection 3.2B is satisfied on and as of that Funding Date; provided
that the minimum amount of Revolving Loans, if any, to be made on any Funding
Date as Eurodollar Rate Loans with a particular Interest Period shall be
$10,000,000 and integral multiples of $1,000,000 in excess of that amount and
the minimum amount of Offshore Revolving Loans to be made on any Funding Date
shall be as set forth in subsection 2.1C; and provided  further
that, United Glass may not deliver a Notice of Borrowing requesting a UK
Revolving Loan at any time a UK Overdraft Agreement is in effect, O-I Canada
may not deliver a Notice of Borrowing requesting a Canadian Revolving Loan at
any time a Canadian Overdraft Agreement is in effect and Avir may not deliver a
Notice of Borrowing requesting an Italian Revolving Loan at any time an Italian
Overdraft Agreement is in effect. 
Notwithstanding anything in this Agreement to the contrary, no Lender
shall make or be obligated to make a Revolving Loan or an Offshore Revolving
Loan if it shall have received notification of a delivery of a Loan Limitation
Notice to a Borrower with respect to such Revolving Loan or Offshore Revolving
Loan from Administrative Agent on or prior to the first Business Day
immediately preceding the proposed Funding Date for such Revolving Loan or
Offshore Revolving Loan.  Term Loans,
Revolving Loans and Offshore Revolving Loans may be continued as or converted
into Base Rate Loans and Euro Rate Loans in the manner provided in
subsection 2.2D.  In lieu of
delivering the above-described Notice of Borrowing, a Borrower may give
Administrative Agent irrevocable telephonic notice by the required time of any
proposed borrowing under this subsection 2.1; provided that such
notice shall be promptly confirmed in writing by delivery of a Notice of
Borrowing to Administrative Agent on or prior to the Funding Date of the
requested Loans.


 


(ii)           Neither Administrative
Agent nor any Lender shall incur any liability to any Borrower in acting upon
any telephonic notice referred to above which Administrative Agent or Lender,
as the case may be, believes in good faith to have been given by a duly
authorized officer or other person authorized to borrow on behalf of the
relevant Borrower, as the case may be, or for otherwise acting in good faith
under this subsection 2.1E, and upon funding of Loans by any Lender in
accordance with this Agreement pursuant to any such telephonic notice such
Borrower shall have effected Loans hereunder.


 


(iii)          Except as provided in
subsection 2.6D, a Notice of Borrowing for a Eurodollar Rate Loan (or
telephonic notice in lieu thereof) shall be irrevocable on and after the
related Interest Rate Determination Date, and the Borrower giving such notice
shall be bound to make a borrowing in accordance therewith, unless such
Borrower pays to Lenders such amounts as may be due under subsection 2.6E
for failure of a borrowing of a Eurodollar Rate Loan, to occur on the date
specified therefor in a Notice of Borrowing (or telephonic notice in lieu thereof).


 


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(iv)          Promptly after receipt
of a Notice of Borrowing pursuant to this subsection 2.1E (or telephonic
notice in lieu thereof) with respect to any Revolving Loans or Offshore
Revolving Loans, Administrative Agent may (but shall not be obligated to)
calculate whether, before and after giving effect to the making of the relevant
Loans:


 


(1)   (A) the Total Utilization of
Revolving Loan Commitments shall exceed (B) the Revolving Loan Commitments then
in effect;


 


(2)   the sum of the Total
Utilization of UK Revolving Loan Commitments plus the Total Utilization
of Australian Revolving Loan Commitments plus the Total Utilization of
Canadian Revolving Loan Commitments plus the Total Utilization of
Italian Revolving Loan Commitments shall exceed the Aggregate Offshore
Sublimit;


 


(3)   the Total Utilization of UK
Revolving Loan Commitments shall exceed the UK Revolving Loan Commitments then
in effect;


 


(4)   the Total Utilization of
Australian Revolving Loan Commitments shall exceed the Australian Revolving
Loan Commitments then in effect;


 


(5)   the Total Utilization of
Canadian Revolving Loan Commitments shall exceed the Canadian Revolving Loan
Commitments then in effect; and


 


(6)   the Total Utilization of
Italian Revolving Loan Commitments shall exceed the Italian Revolving Loan
Commitments then in effect.


 


In the event that Administrative Agent determines that
any of the statements in clauses (1) through (6) is true or will be true after
giving effect to the making of the relevant Loans, Administrative Agent shall
deliver to each Borrower written notice (a “Loan Limitation Notice”)
thereof, and shall notify each Lender promptly of its delivery of such notice.


 


F.     Disbursement of Funds.


 


(i)            All Revolving Loans
and Offshore Revolving Loans under this Agreement shall be made by Lenders
simultaneously and proportionately to their respective Pro Rata Shares of the
Revolving Loan Commitments, Australian Revolving Loan Commitments, Canadian
Revolving Loan Commitments, Italian Revolving Loan Commitments or UK Revolving
Loan Commitments, as the case may be, it being understood that no Lender shall
be responsible for any default by any other Lender in that other Lender’s
obligation to make a Term Loan, a Revolving Loan or an Offshore Revolving Loan
requested hereunder nor shall the Commitment of any Lender to make the
particular type of Loan requested be increased or decreased as a result of a
default by any other Lender in that other Lender’s obligation to make a Loan
requested hereunder.  Promptly after
receipt of a Notice of Borrowing pursuant to subsection 2.1E (or
telephonic notice in lieu thereof) or the deemed receipt of a Notice of
Borrowing pursuant to subsection 2.8D, Administrative Agent shall notify
each applicable Lender of the proposed borrowing.  Except as provided in the next succeeding
sentence for Lenders designating a UK Lending Office, each Lender shall make
the amount of its Revolving Loan or Offshore Revolving Loan available to
Administrative Agent, in Same Day Funds, at the Domestic Funding and Payment
Office not later than 12:00 noon (New York time) on the


 


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Funding Date. 
Each Lender which has designated a UK Lending Office shall make the
amount of its UK Revolving Loans available to UK Administrative Agent, in Same
Day Funds, at the UK Funding and Payment Office not later than 12:00 noon
(London time) on the Funding Date.  From
and after the Third Restatement Date, except as provided in
subsection 2.1B (with respect to the repayment of the Domestic Overdraft
Amount), subsection 2.1D(ii) (with respect to the repayment of any
Offshore Overdraft Amount), subsection 2.4B(ii)(d) (with respect to repayments
of Term Loans out of the Acquisition Sublimit), subsection 2.4B(ii)(e) (with
respect to the repayment of Term Loans out of the Existing Holdings Senior
Notes Redemption Sublimit) and in subsection 2.8D (with respect to the
reimbursement of amounts drawn under Letters of Credit), the satisfaction or
waiver of the conditions precedent specified in subsection 3.2,
Administrative Agent shall make the proceeds of Revolving Loans and Offshore
Revolving Loans available to the Borrower requesting such Revolving Loans or
Offshore Revolving Loans on such Funding Date by causing an amount of Same Day
Funds equal to the proceeds of all such Revolving Loans or Offshore Revolving
Loans received by Administrative Agent to be credited to the account of such
Borrower at such office of Administrative Agent; provided that UK Administrative
Agent shall make the proceeds of funds received from Lenders pursuant to the
immediately preceding sentence available to United Glass on such Funding Date
by causing an amount of Same Day Funds equal to such proceeds to be credited to
the account of United Glass at the UK Funding and Payment Office.


 


(ii)           Unless Administrative
Agent shall have been notified by any Lender prior to any Funding Date that
such Lender does not intend to make available to Administrative Agent such
Lender’s Loan on such Funding Date, Administrative Agent may assume that such
Lender has made such amount available to Administrative Agent on such Funding
Date and Administrative Agent in its sole discretion may, but shall not be
obligated to, make available to the applicable Borrower a corresponding amount
on such Funding Date.  If such
corresponding amount is not in fact made available to Administrative Agent by
such Lender, Administrative Agent shall be entitled to recover such corresponding
amount on demand from such Lender together with interest thereon, for each day
from such Funding Date until the date such amount is paid to Administrative
Agent, at the customary rate set by Administrative Agent for the correction of
errors among banks for three Business Days and thereafter at the Base
Rate.  If such Lender does not pay such
corresponding amount forthwith upon Administrative Agent’s demand therefor,
Administrative Agent shall promptly notify the applicable Borrower, and such
Borrower shall immediately pay such corresponding amount to Administrative
Agent.  If such Borrower does not pay
such corresponding amount, Administrative Agent may require each Revolving
Lender to purchase a participation in the amount unpaid by such Borrower in an
amount equal to that Lender’s Pro Rata Share of such unpaid amount.  Nothing in this subsection 2.1F shall be
deemed to relieve any Lender from its obligation to fulfill its Commitments
hereunder or to prejudice any rights which Borrower may have against any Lender
as a result of any default by such Lender hereunder.


 


G.    The Register; Notes.


 


(i)            Administrative Agent,
acting for this purpose as an agent of the Borrowers, shall maintain, at its
address referred to in subsection 10.10, a register for the inscription of
the names and addresses of Lenders and the Commitments and Loans of each Lender
from time to time (the “Register”).  Borrowers, Borrowers’ Agent, Agents, and
Lenders


 


73
















 


may treat each Person whose name is inscribed in the
Register as a Lender hereunder for all purposes of this Agreement.  The Register shall be available for
inspection by Company, Borrowers, Borrowers’ Agent, Agents or any Lender at any
reasonable time and from time to time upon reasonable prior notice.


 


(ii)           Administrative Agent
shall inscribe in the Register the Commitments and the Loans from time to time
of each Lender, the amount of each Lender’s participation in outstanding
Letters of Credit and each repayment or prepayment in respect of the principal
amount of the Loans of each Lender and the principal amount owing from time to
time by Borrowers in respect of each Loan to each Lender of such Loan.  Any such inscription shall be conclusive and
binding on Borrowers and each Lender, absent manifest or demonstrable error; provided
that failure to make any such inscription, or any error in such inscription,
shall not affect any Borrower’s Obligations in respect of the applicable
Loans.  The inscription in the Register
of the principal amount owing from time to time by the Borrowers in respect of
each Tranche A1 Term Loan or Australian Revolving Loan shall constitute an
unconditional and irrevocable covenant by each such Australian Offshore
Borrower in favor of the Person whose name is so inscribed as the Lender in
respect of such Loan that the Australian Offshore Borrower will make all
payments of principal and interest in respect of the Loan in accordance with
this Agreement, make all other payments required by this Agreement to be made
by it in respect of such Loan and otherwise perform all of its obligations
under this Agreement in full and by the due date.


 


(iii)          Each Lender shall record
on its internal records (including, without limitation, any promissory note
described in subsection 2.1G(iv)) the amount of each Loan made by it and
each payment in respect thereof and, in the case of a Lender with respect to
each Loan made by it to an Offshore Borrower, the identity of the Offshore
Borrower in respect thereof, the amount thereof and each Interest Period
applicable thereto; provided that in the event of any inconsistency
between the Register and any Lender’s records, the inscriptions in the Register
shall govern, absent manifest or demonstrable error.


 


(iv)          If so requested by any
Lender by written notice to Domestic Borrowers (with a copy to Administrative
Agent) at any time, each Domestic Borrower shall execute and deliver to such
Lender (and/or, if so specified in such notice, any Person who is an assignee
of such Lender pursuant to subsection 10.2 hereof), promptly after such
Domestic Borrower’s receipt of such notice, a promissory note or promissory
notes to evidence such Lender’s Tranche B1 Term Loan and/or Revolving Loans to
such Domestic Borrower, substantially in the form of Exhibit IV-B or Exhibit
V hereto, respectively.  If so
requested by any Lender having Italian Revolving Loan Exposure by written
notice to Avir (with a copy to Administrative Agent and Borrower’s Agent) at
any time, Avir shall execute and deliver to such Lender (and/or, if so
specified in such notice, any Person who is an assignee of such Lender pursuant
to subsection 10.2 hereof), promptly after Avir’s and Borrowers’ Agent’s
receipt of such notice, a promissory note or promissory notes to evidence such
Lender’s Italian Revolving Loans, substantially in the form of Exhibit VI.  If so requested by any Lender having Canadian
Revolving Loan Exposure by written notice to O-I Canada (with a copy to
Administrative Agent and Borrower’s Agent), O-I Canada shall execute and
deliver to such Lender (and/or, if so specified in such notice, any Person who
is an assignee of such Lender pursuant to subsection 10.2 hereof),
promptly after O-I Canada’s and Borrowers’ Agent’s receipt of such


 


74
















 


notice, a promissory note or promissory notes to
evidence such Lender’s Canadian Revolving Loans, substantially in the form of Exhibit
VI.


 


Australian
Revolving Loans, other than Australian Revolving Loans under the Second Amended
and Restated Credit Agreement which have been amended and restated as
Australian Revolving Loans as described in subsection 2.1A(i) or 2.1C, have
been, and from and after the Third Restatement Date, will be issued by either
or both of the Australian Offshore Borrowers to the Lenders as debentures in inscribed
form.  Such issue will be effected by
inscription of each Loan and the name of each Lender as described in this
subsection 2.1G.  Such inscription shall
be made on behalf of either or both of the Australian Offshore Borrowers for
the purposes of issuing the debentures. 
In addition, the Australian Offshore Borrower(s) making such issue shall
execute and deliver to each Lender having an Australian Revolving Loan Exposure
one or more Australian Revolving Loan Notes, substantially in the form of Exhibit
VI attached hereto, immediately after the making of such Australian
Revolving Loans.


 


The
Tranche A Term Loans that were converted into Tranche A1 Term Loans on the
December 2003 Amendment Effective Date and amended and restated as Tranche A1
Term Loans under the Second Amended and Restated Credit Agreement and amended
and restated as Tranche A1 Term Loans hereunder shall continue as debentures in
inscribed form.


 


In addition, from
time to time, upon receipt of notice from any Lender (with a copy to Administrative
Agent and Borrowers’ Agent) each Australian Offshore Borrower shall execute and
deliver additional Tranche A1 Term Loan Notes substantially in the form of
Exhibit IV-A hereto and/or Australian Revolving Loan Notes substantially in the
form of Exhibit VI hereto to any Person who is an assignee of a Lender of such
Type of Loan pursuant to subsection 10.2 hereof (or, in the case of any
Additional Offshore Borrower, as a condition of becoming an Australian Offshore
Borrower, each Lender having an Australian Revolving Loan commitment to such
Australian Offshore Borrower).


 


The
French Tranche C1 Term Loans and French Tranche C2 Term Loans as amended and
restated as French Tranche C1 Term Loans and the French Tranche C2 Term Loans
hereunder shall continue as debentures in inscribed form.


 


In addition, from
time to time, upon receipt of notice from any Lender (with a copy to
Administrative Agent and Borrowers’ Agent) BSN shall execute and deliver
additional French Tranche C1 Term Loan Notes and French Tranche C2 Term Loan
Notes substantially in the form of Exhibits IV-C1 and IV-C2 hereto to any
Person who is an assignee of a Lender of such Type of Loan pursuant to
subsection 10.2 hereof.


 


2.2          Interest on the Loans.


 


A.    Rate of Interest.


 


(i)            All Loans shall bear
interest on the unpaid principal amount thereof from the date made through
maturity (whether by acceleration or otherwise) at a rate determined by
reference to (a) in the case of all Loans other than the French Tranche C2 Term
Loans, the Base Rate or the Adjusted Eurodollar Rate and (b) in the case of the
French Tranche C2 Term Loans, Euro LIBOR. 
Except for French Tranche C2 Term Loans (which were made


 


75
















 


and must continue as Euro LIBOR Loans) and except to
the extent that this Agreement specifically provides that certain Revolving
Loans and Offshore Revolving Loans must be made as Base Rate Loans, the
applicable basis for determining the rate of interest with respect to Term
Loans, Revolving Loans and Offshore Revolving Loans shall be selected by a
Borrower at the time such Borrower gives a Notice of Borrowing pursuant to
subsection 2.1E (or is deemed to have given a Notice of Borrowing pursuant
to subsection 2.8D) or at the time a Notice of Conversion/Continuation is
given pursuant to subsection 2.2D. 
Except in the case of French Tranche C2 Term Loans, if on any day a Loan
is outstanding with respect to which notice has not been delivered to
Administrative Agent in accordance with the terms of this Agreement specifying
the basis for determining the rate of interest, then for that day that Loan
shall bear interest determined by reference to the Base Rate.  If on any day a French Tranche C2 Term Loan
is outstanding with respect to which notice has not been delivered to
Administrative Agent in accordance with the terms of this Agreement specifying
the basis for determining the rate of interest, then such Loan shall be
automatically continued as a Euro LIBOR Loan with a one month Interest Period.


 


Term Loans, Revolving
Loans and Offshore Revolving Loans shall bear interest through maturity as
follows:


 


(a)           if a Base Rate Loan, then at the sum of the
Base Rate plus the Applicable Base Rate Margin;


 


(b)           if a Eurodollar Rate Loan, then at the sum
of the Adjusted Eurodollar Rate plus the Applicable Euro Margin; or


 


(c)           if
a Euro LIBOR Loan, then at the sum of Euro LIBOR plus the Applicable Euro
Margin.


 


provided, however, in no
event shall any interest be payable in respect of Italian Revolving Loans which
exceeds the amount permitted under applicable Italian law.


 


B.    Interest Periods.


 


In
connection with each Euro Rate Loan, the Borrower requesting such Loan shall
elect an interest period (each an “Interest Period”)
to be applicable to such Loan, which Interest Period shall be a one, two, three
or six month period (or, with Administrative Agent’s consent, a one, two or
three week period); provided that:


 


(i)            the initial Interest
Period for any Euro Rate Loan shall commence on the Funding Date in respect of
such Loan, in the case of a Loan initially made as a Euro Rate Loan, or on the
date specified in the applicable Notice of Conversion/Continuation, in the case
of a Loan converted to a Eurodollar Rate Loan;


 


(ii)           in the case of
immediately successive Interest Periods applicable to a Euro Rate Loan
continued as such pursuant to a Notice of Conversion/Continuation or otherwise,
each successive Interest Period shall commence on the day on which the next
preceding Interest Period expires;


 


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


 


(iv)          any Interest Period with
respect to Euro Rate Loans which 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 a calendar month;


 


(v)           no Interest Period with
respect to any Tranche A1 Term Loan shall extend beyond the Tranche A1 Term
Loan Maturity Date;


 


(vi)          no Interest Period with
respect to any Tranche B1 Term Loan shall extend beyond the Tranche B1 Term
Loan Maturity Date;


 


(vii)         no Interest Period with
respect to any French Tranche C1 Term Loan or any French Tranche C2 Term Loan
shall extend beyond the Tranche C Term Loan Maturity Date;


 


(viii)        there shall be no more
than 20 Interest Periods outstanding at any time with respect to Eurodollar
Rate Loans to Domestic Borrowers; and there shall be no more than (a) 10
Interest Periods outstanding at any time with respect to UK Revolving Loans,
(b) 15 Interest Periods outstanding at any time with respect to Australian
Revolving Loans and Tranche A1 Term Loans, (c) two Interest Periods outstanding
at any time with respect to Canadian Revolving Loans, (d) two Interest Periods
outstanding at any time with respect to Italian Revolving Loans and (e) 10
Interest Periods outstanding at any time with respect to the French Tranche C1
Term Loans and the French Tranche C2 Term Loans collectively; and


 


(ix)           in the event a Borrower
fails to specify an Interest Period in the applicable Notice of Borrowing or
Notice of Conversion/Continuation, such Borrower shall be deemed to have
selected an Interest Period of one month.


 


C.    Interest Payments.  Subject to subsection 2.2E, interest
shall be payable on the Loans as follows:


 


(i)            interest on each Base
Rate Loan shall be payable in arrears on and to each March 15,
June 15, September 15, and December 15 of each year, commencing
on December 15, 2004, upon prepayment of that Loan (to the extent accrued on
the amount being prepaid) and at maturity; and


 


(ii)           interest on each Euro
Rate Loan shall be payable in arrears on and to each Interest Payment Date
applicable to that Loan, upon any prepayment of that Loan (to the extent
accrued on the amount being prepaid) and at maturity.


 


D.    Conversion or Continuation.  Subject to the provisions of
subsection 2.6, the applicable Borrower shall have the option (i) to
convert at any time all or any part of its


 


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outstanding
Term Loans (other than French Tranche C2 Term Loans, which shall always
constitute Euro LIBOR Loans) or Revolving Loans equal to $10,000,000 and
integral multiples of $1,000,000 in excess of that amount from Loans bearing
interest at a rate determined by reference to one basis to Loans bearing
interest at a rate determined by reference to an alternative basis,
(ii) upon the expiration of any Interest Period applicable to a Eurodollar
Rate Loan to a Domestic Borrower, to continue all or any portion of such
Eurodollar Rate Loan equal to $10,000,000 and integral multiples of $1,000,000
in excess of that amount as a Eurodollar Rate Loan, (iii) to convert at any
time all or any part of its outstanding Offshore Revolving Loans equal to
$5,000,000 and integral multiples of $1,000,000, from Loans bearing interest at
a rate determined by reference to one basis to Loans bearing interest at a rate
determined by reference to an alternative basis and (iv) upon the
expiration of any Interest Period applicable to a Euro Rate Loan, to continue
as a Euro Rate Loan all or any portion of such Euro Rate Loan equal to
$5,000,000 and integral multiples of $1,000,000, and the succeeding Interest
Period(s) of such continued Loan shall commence on the last day of the Interest
Period of the Loan to be continued, provided, however, that a
Eurodollar Rate Loan may only be converted into a Base Rate Loan on the
expiration date of an Interest Period applicable thereto; and provided, further,
that, unless Requisite Lenders otherwise agree, no outstanding Loan may be
continued as, or be converted into, a Eurodollar Rate Loan when any Event of
Default has occurred and is continuing.


 


The applicable Borrower shall deliver a Notice of
Conversion/Continuation to Administrative Agent no later than 12:00 Noon (New
York time) at least one Business Day in advance of the proposed
conversion/continuation date (in the case of a conversion to a Base Rate Loan)
or three Business Days in advance of the proposed conversion/continuation date
(in the case of a conversion to, or a continuation of, a Euro Rate Loan).  A Notice of Conversion/Continuation shall
specify (i) the proposed conversion/continuation date (which shall be a
Business Day), (ii) the amount and Type of the Loan to be converted/continued,
(iii) the nature of the proposed conversion/continuation and (iv) in
the case of a conversion to, or a continuation of, a Euro Rate Loan, the
requested Interest Period.  In lieu of
delivering the above described Notice of Conversion/Continuation, the
applicable Borrower may give Administrative Agent telephonic notice by the
required time of any proposed conversion/continuation under this
subsection 2.2D; provided, that, such notice shall be
promptly confirmed in writing by delivery of a Notice of Conversion/Continuation
to Administrative Agent on or before the proposed conversion/continuation date.


 


Administrative Agent shall not incur any liability to
any Loan Party in acting upon any telephonic notice referred to above which
Administrative Agent believes in good faith to have been given by a duly
authorized officer or other person authorized to act on behalf of a Borrower in
connection with any telephonic notice referred to above or for otherwise acting
in good faith under this subsection 2.2D and upon conversion/continuation
by Administrative Agent in accordance with this Agreement pursuant to any
telephonic notice, such Borrower shall have effected a conversion or
continuation, as the case may be, hereunder.


 


Except as provided in subsection 2.6D, a Notice
of Conversion/Continuation for conversion to, or continuation of, a Euro Rate
Loan (or telephonic notice in lieu thereof) shall be irrevocable on and after
the related Interest Rate Determination Date, and upon delivering a Notice of
Conversion/Continuation, the relevant Borrower shall be bound to convert or
continue


 


78





















 


in accordance
therewith, unless such Borrower pays to Lenders such amounts as may be due
under subsection 2.6E for failure of a conversion to or continuation of
any Euro Rate Loan to occur on the date specified therefor in a Notice of
Conversion/Continuation (or telephonic notice in lieu thereof).


 


E.     Post-Maturity Interest.  Any principal payments on the Loans (other
than the French Tranche C2 Term Loans) not paid when due and, to the extent
permitted by applicable law, any interest payments on the Loans not paid when
due, in each case whether at stated maturity, by notice of prepayment, by
acceleration or otherwise, shall thereafter bear interest payable upon demand
at a rate equal to the sum of the Base Rate plus the Applicable Base
Rate Margin plus 2.00% per annum. 
Any principal payments on the French Tranche C2 Term Loans not paid when
due and, to the extent permitted by applicable law, any interest payments on
the French Tranche C2 Term Loans not paid when due, in each case whether at
stated maturity, by notice of prepayment, by acceleration or otherwise, shall
thereafter bear interest payable upon demand at a rate equal to the sum of Euro
LIBOR plus the Applicable Euro Margin plus 2.00% per annum.


 


F.     Computation of Interest.  Interest on the Loans shall be computed on
the basis of a 360-day year, in each case for the actual number of days elapsed
in the period during which it accrues. 
In computing interest on any Loan, the date of the making of the Loan or
the first day of an Interest Period, as the case may be, shall be included and
the date of payment or the expiration date of an Interest Period, as the case
may be, shall be excluded; provided that if a Loan is repaid on the same
day on which it is made, one day’s interest shall be paid on that Loan.


 


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


 


H.    Canadian Interest Limitations. If any
provision of this Agreement or any other Loan Documents would obligate O-I
Canada to make any payment of interest with respect to the Obligations of O-I
Canada or other amount payable to any Lender in an amount or calculated at a
rate which would be prohibited by law or would result in a receipt by that
Lender of interest with respect to the Obligations of O-I Canada at a criminal
rate (as such terms are construed under the Criminal Code (Canada)) then,
notwithstanding such provision, such amount or rates shall be deemed to have
been adjusted with retroactive effect to the maximum amount or rate of
interest, as the case may be, as would not be so prohibited by law or so result
in a receipt by that Lender of interest with respect to the Obligations of O-I
Canada at a criminal rate, such adjustment to be effected, to the extent
necessary, as follows:  (1) first, by
reducing the amount of rates or interest required to be paid to the affected
Lender under this subsection 2.2H; and (2) thereafter, by reducing any fees,
commissions, premiums and other amounts required to be paid to the affected
Lender which would constitute interest with respect to the Obligations of O-I
Canada for purposes of Section 347 of the Criminal Code (Canada).  Notwithstanding the foregoing, and after
giving effect to all adjustments contemplated thereby, if any Lender shall have
received an amount in respect of Obligations of O-I Canada in excess of the
maximum permitted by that


 


79





















 


section
of the Criminal Code (Canada), then O-I Canada shall be entitled, by notice in
writing to the affected Lender, to obtain reimbursement from that Lender in an
amount equal to such excess, and pending such reimbursement, such amount shall
be deemed to be an amount payable by that Lender to O-I Canada.  Any amount or rate of interest under the
Obligations of O-I Canada referred to in this subsection 2.2H shall be
determined in accordance with generally accepted actuarial practices and
principals at an effective annual rate of interest over the term that any
Offshore Revolving Loan remains outstanding on the assumption that any charges,
fees or expenses that fall within the meaning of “interest” (as defined in the
Criminal Code (Canada)) shall, if related to a specific period of time, be
pro-rated over that period of time and otherwise be pro-rated over the period
from the Restatement Date to the termination of the Offshore Revolving Loan
Commitment (with reference to the Obligations of O-I Canada) and, in the event
of a dispute, a certificate of a Fellow of the Canadian Institute of Actuaries
appointed by the Administrative Agent shall be conclusive for the purposes of
such determination.


 


I.      French “Global Effective Rate”. For the purpose of article L.313-1
to L.313-6 of the French Code de la Consommation,
the parties to this Agreement acknowledge that, due to the floating interest
rate, it was not possible to determine in advance the global effective rate (“taux effectif global”) for the Loans to BSN on the BSN
Acquisition Closing Date.  BSN
acknowledges it received from the Administrative Agent on the BSN Acquisition
Closing Date a letter stating for information purposes an effective global rate
applicable to outstanding amounts under French Tranche C1 Term Loans and French
Tranche C2 Term Loans corresponding to examples.  The parties recognize that such letter is an
integral part of the Agreement.


 


2.3          Fees


 


A.    Facility Fees.  Domestic Borrowers shall pay or cause to be
paid, to Administrative Agent (for distribution to each Revolving Lender in
accordance with such Lender’s Pro Rata Share) facility fees with respect to the
Revolving Loan Commitments, for the period from and including the Second
Restatement Date to and excluding the Revolving Loan Commitment Termination
Date, equal to (i) the daily average amount of the Revolving Loan
Commitments (without regard to the Total Utilization of Revolving Loan
Commitments at any time or from time to time), as the case may be, multiplied
by 0.50% per annum, plus (ii) the daily average amount of Revolving
Loan Commitments reserved to the Acquisition Sublimit multiplied by a
percentage equal to one-half of the Applicable Euro Margin for Revolving Loans,
plus (iii) at any time when the amount of Revolving Loan Commitments reserved
to the Existing Holdings Senior Notes Redemption Sublimit exceeds $75,000,000,
the daily average amount of Revolving Loan Commitments reserved to the Existing
Holdings Senior Notes Redemption Sublimit multiplied by a percentage
equal to one-half of the Applicable Euro Margin for Revolving Loans, such
facility fees to be computed on the basis of a 360-day year and to be payable
in arrears on each Fee Payment Date for the three-month period ending on the
day prior to such Fee Payment Date, commencing on the first such date to occur
after the Third Restatement Date, and on the Revolving Loan Commitment
Termination Date.


 


B.    Other Fees.  Domestic Borrowers agree to pay or cause to
be paid an annual administrative fee to Administrative Agent and such other
fees to Arrangers and Agents, in each case in the amounts and at the times
agreed upon between Domestic Borrowers and the applicable Arranger or Agent.


 


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2.4          Repayment and Prepayments; Reductions
in Commitments


 


A.    Scheduled Payments of Term Loans.


 


(i)            Scheduled Payments of Tranche A1
Term Loans.  ACI shall make principal
payments in Dollars on the Tranche A1 Term Loans in installments on the dates
and in the amounts set forth below:


 




	
  Date

  	
   

  	
  Scheduled Repayment-

  Tranche A1 Term Loans

  	
   

  
	
  April 1, 2006

  	
   

  	
  $

  	
  25,000,000

  	
   

  
	
  October 1, 2006

  	
   

  	
  $

  	
  55,000,000

  	
   

  
	
  April 1, 2007

  	
   

  	
  $

  	
  300,000,000

  	
   

  
	
  Total:

  	
   

  	
  $

  	
  380,000,000

  	
   

  






 


; provided that the scheduled installments of
principal of the Tranche A1 Term Loans set forth above shall be reduced in
connection with any voluntary or mandatory prepayments of the Tranche A1 Term
Loans in accordance with subsection 2.4B(iii); and provided, further
that the Tranche A1 Term Loans and all other amounts owed hereunder with
respect to the Tranche A Term Loans shall be paid in full no later than April
1, 2007, and the final installment payable by ACI in respect of the Tranche A1
Term Loans on such date shall be in an amount, if such amount is different from
that specified above, sufficient to repay all amounts owing by ACI under this
Agreement with respect to the Tranche A1 Term Loans.


 


(ii)           Scheduled Payments of Tranche B1
Term Loans.  Owens-Brockway shall
make principal payments on the Tranche B1 Term Loans in Dollars on the dates
and in the amounts set forth below:


 




	
  Date

  	
   

  	
  Scheduled Repayment-

  Tranche B1 Term Loans

  	
   

  
	
  October 1, 2007

  	
   

  	
  $

  	
  6,666,667

  	
   

  
	
  April 1, 2008

  	
   

  	
  $

  	
  268,333,333

  	
   

  
	
  Total:

  	
   

  	
  $

  	
  275,000,000

  	
   

  






 


; provided that the scheduled installments of
principal of the Tranche B1 Term Loans set forth above shall be reduced in
connection with any voluntary or mandatory prepayments of the Tranche B1 Term
Loans in accordance with subsection 2.4B(iii); and provided, further that
the Tranche B1 Term Loans and all other amounts owed hereunder with respect to
the Tranche B1 Term Loans shall be paid in full no later than April 1, 2008,
and the final installment payable by Owens-Brockway in respect of the Tranche
B1 Term Loans on such date shall be in an amount, if such amount is different
from that specified above, sufficient to repay all amounts owing by
Owens-Brockway under this Agreement with respect to the Tranche B1 Term Loans.


 


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(iii)          Scheduled Payments of French
Tranche C1 Term Loans.  BSN shall
make principal payments on the French Tranche C1 Term Loans in Dollars on the
dates and in the amounts set forth below:


 




	
  Date

  	
   

  	
  Scheduled Repayment-

  French Tranche C1 Term

  Loans

  	
   

  
	
  April 1, 2008

  	
   

  	
  $

  	
  230,000,000

  	
   

  
	
  Total:

  	
   

  	
  $

  	
  230,000,000

  	
   

  






 


; provided that
the scheduled installments of principal of the French Tranche C1 Term Loans set
forth above shall be reduced in connection with any voluntary or mandatory
prepayments of the French Tranche C1 Term Loans in accordance with
subsection 2.4B(iii); and provided, further that the French Tranche C1
Term Loans and all other amounts owed hereunder with respect to the French
Tranche C1 Term Loans shall be paid in full no later than April 1, 2008, and
the final installment payable by BSN in respect of the French Tranche C1 Term
Loans on such date shall be in an amount, if such amount is different from that
specified above, sufficient to repay all amounts owing by BSN under this
Agreement with respect to the French Tranche C1 Term Loans.


 


(iv)          Scheduled Payments of French
Tranche C2 Term Loans.  BSN shall
make principal payments on the French Tranche C2 Term Loans in Euros on the
dates and in the amounts set forth below:


 




	
  Date

  	
   

  	
  Scheduled Repayment-

  French Tranche C2 Term

  Loans

  	
   

  
	
  October 1, 2007

  	
   

  	
  €

  	
  2,000,000

  	
   

  
	
  April 1, 2008

  	
   

  	
  €

  	
  50,000,000

  	
   

  
	
  Total:

  	
   

  	
  €

  	
  52,000,000

  	
   

  






 


; provided that
the scheduled installments of principal of the French Tranche C2 Term Loans set
forth above shall be reduced in connection with any voluntary or mandatory
prepayments of the French Tranche C2 Term Loans in accordance with
subsection 2.4B(iii); and provided, further that the French Tranche C2
Term Loans and all other amounts owed hereunder with respect to the French
Tranche C2 Term Loans shall be paid in full no later than April 1, 2008, and
the final installment payable by BSN in respect of the French Tranche C2 Term
Loans on such date shall be in an amount, if such amount is different from that
specified above, sufficient to repay all amounts owing by BSN under this Agreement
with respect to the French Tranche C2 Term Loans.


 


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B.    Prepayments.


 


(i)            Voluntary Prepayments.  Borrowers may, upon written or telephonic
notice to Administrative Agent on or prior to 12:00 Noon (New York time)
on the date of prepayment (in the case of Base Rate Loans) or three Business
Days’ prior written or telephonic notice (in the case of Euro Rate Loans),
which notice, if telephonic, shall be promptly confirmed in writing to
Administrative Agent and which notice Administrative Agent will promptly
transmit by telegram, telex or telephone to each Lender, at any time and from
time to time prepay any Term Loan, Revolving Loan or Offshore Revolving Loan in
whole or in part in an aggregate minimum amount of $5,000,000 and integral
multiples of $1,000,000 in excess of that amount; provided, however,
that if a Euro Rate Loan is prepaid on a date other than the last day of the
Interest Period applicable thereto, the prepaying Borrower shall be liable for
any payments required by subsection 2.6E. 
Notice of prepayment having been given as aforesaid, the principal
amount of the Loans specified in such notice shall become due and payable on
the prepayment date.


 


(ii)           Mandatory Prepayments of Loans and
Mandatory Reductions of Revolving Loan Commitments.  The Loans shall be prepaid and/or subject to
subsection 2.4B(iii), the Revolving Loan Commitments shall be permanently
reduced in the amount and under the circumstances set forth below:


 


(a)  Prepayments
from Net Asset Sale Proceeds.  (i) No
later than the third Business Day after the date of receipt by Company or any
of its Subsidiaries that are Loan Parties (including Borrowers) of any Net
Asset Sale Proceeds in respect of any Triggering Asset Sale by Company or any
of its Subsidiaries that are Loan Parties (including Borrowers), the Borrowers
shall prepay the Term Loans in an amount equal to the lesser of (x) the portion
of the Net Asset Sale Proceeds permitted to be applied to the Loans under the
terms of the Intercreditor Agreement and (y) the aggregate amount outstanding
under the Term Loans, and (ii) in the event of a Triggering Asset Sale by a
foreign Wholly-Owned Subsidiary of Company that is not an Offshore Borrower or
Offshore Guarantor, within 355 days after receipt by such Foreign Subsidiary of
any Net Asset Sale Proceeds, if and to the extent such Net Asset Sale Proceeds
may be repatriated (by reason of payment of intercompany note or otherwise) to
the United States of America without (in the reasonable judgment of Company)
resulting in a material tax or other liability to Company or its Subsidiaries,
such Net Asset Sale Proceeds shall be applied pursuant to clause (i), above.


 


(b)  Prepayments
from Excess Cash Flow.  If there
shall be Consolidated Excess Cash Flow for any Fiscal Year (commencing with the
Fiscal Year ending on December 31, 2004) and the Consolidated Leverage Ratio as
of the end of such Fiscal Year is greater than 3.50:1, Borrowers shall, no
later than ninety (90) days after the last day of such Fiscal Year, prepay the
Term Loans in an amount equal to 50% of such Consolidated Excess Cash Flow.


 


(c)  Prepayments
and Reductions from Net Insurance/Condemnation Proceeds.  No later than the third Business Day
following the date of receipt by Administrative Agent or by Company or any of
its Domestic Subsidiaries (including Borrowers) of any Net


 


83





















 


Insurance/Condemnation
Proceeds that are required to be applied to prepay the Loans and/or reduce the Revolving
Loan Commitments pursuant to the provisions of subsection 5.4, (i) the
Borrowers shall prepay the Term Loans in an amount equal to the lesser of (A)
the portion of the Net Insurance/ Condemnation Proceeds permitted to be applied
to the Loans under the terms of the Intercreditor Agreement and (B) the
aggregate outstanding amount of the Term Loans, and (ii) the Revolving Loan
Commitments shall be permanently reduced by an amount equal to the Revolving
Loan Commitments multiplied by the positive difference between the Net
Insurance/Condemnation Proceeds permitted to be applied to the Loans under the
terms of the Intercreditor Agreement and amounts applied to the Term Loans
under clause (i) of this subsection.


 


(d)  Prepayments
and Reductions from Net Equity Securities Proceeds.  No later than the third Business Day after
the date of receipt by Holdings or Company or any of its Subsidiaries of any
Net Equity Securities Proceeds:


 


(A)            the Borrowers shall prepay the Term
Loans in an amount equal to the Applicable Percentage of such Net Equity
Securities Proceeds; or


 


(B)             at the written election of
Borrowers’ Agent delivered to Administrative Agent not later than the third
Business Day after receipt of such Net Equity Securities Proceeds, the
Borrowers may deposit up to an amount equal to the Applicable Percentage of
such Net Equity Securities Proceeds into the OI Grantor Collateral Account
established with the Collateral Agent pursuant to Section 12 of the
Security Agreement (such amounts so deposited being referred to herein as the “Acquisition Collateral Account”), with
amounts therein to be used thereafter solely to finance a Permitted Acquisition
consummated within 180-days of such deposit. To the extent that any amounts
deposited in the Acquisition Collateral Account are not utilized to finance a
Permitted Acquisition during the 180-day period immediately following their
deposit under the preceding sentence, then immediately upon the expiration of
such 180-day period or such earlier period as elected by the Borrower’s Agent,
amounts held in such Acquisition Collateral Account shall be released to prepay
Term Loans in accordance with clause (A), above; or


 


(C)             at the written election of
Borrowers’ Agent delivered to Administrative Agent not later than the third
Business Day after receipt of such Net Equity Securities Proceeds, an amount
equal to the lesser of (i) the Applicable Percentage of such Net Equity
Securities Proceeds and (ii) the aggregate Revolving Loan Commitments may be
reserved within the Revolving Loan Commitments to each Domestic Borrower as a
subfacility thereunder (the “Acquisition
Sublimit”) (with any excess to be
applied pursuant to clause (A) or (B), above). 
The portion of the Revolving Loan Commitments reserved to the
Acquisition Sublimit under the preceding


 


84





















 


sentence may be used
solely to finance a Permitted Acquisition consummated within 180-days of such
reservation.  If, after giving effect to
such reservation, the Total Utilization of the Revolving Loan Commitments
exceeds the amount of the Revolving Loan Commitments, Domestic Borrowers shall
immediately prepay the Revolving Loans to the extent necessary so that Total
Utilization of the Revolving Loan Commitments does not exceed the amount of the
Revolving Loan Commitments.  To the
extent that any amounts reserved to the Acquisition Sublimit hereunder are not
utilized to finance a Permitted Acquisition consummated within 180-days of such
reservation under the preceding sentence, then immediately upon the expiration
of such 180-day period or such earlier period as elected by Borrower’s Agent,
Borrowers shall prepay Term Loans in accordance with clause (A) above in an
amount equal to the amount reserved within the Acquisition Sublimit not so
utilized; provided, that, unless the Borrowers’ Agent shall have
notified Administrative Agent prior to 11:00 a.m. (New York time) on the
Business Day immediately prior to the expiration of such 180-day period that
the Borrowers intend to make such prepayment of the Term Loans with funds other
than the proceeds of Revolving Loans, each of the Domestic Borrowers shall be
deemed to have given a Notice of Borrowing to Administrative Agent requesting
Lenders to make Revolving Loans to the Domestic Borrowers which are Base Rate
Loans, on the date on which such 180-day period expires, in an amount equal to
fifty percent (50%) times the lesser of (i) the amount of Term Loans required
to be prepaid pursuant to this clause (C), and (ii) the aggregate amount of Term
Loans outstanding, and, subject to satisfaction or waiver of the conditions
specified in subsection 3.2, Lenders shall, on the date of prepayment of
the Term Loans is required by this clause (C), make Revolving Loans to such
Borrowers which are Base Rate Loans in such amount as aforesaid, the proceeds
of which shall be applied directly by Administrative Agent to prepay Term Loans
as required by this clause (C); provided, further, that,
if, as of the date such Revolving Loans are to be made, the Revolving Loan
Commitments have terminated due to an Event of Default or the conditions
specified in subsection 3.2 have not been satisfied or waived, each Revolving
Lender shall purchase its Pro Rata Share (determined with respect to Revolving
Loans) of participations in the Term Loans in an aggregate amount equal to that
portion of the Acquisition Sublimit that bears the same ratio to the total
Acquisition Sublimit as the outstanding Term Loans bear to an amount equal to
the sum of all Loans then outstanding plus the total Acquisition Sublimit (with
such participation allocated ratably among the outstanding Tranche A1 Term
Loans, Tranche B1 Term Loans, Tranche C Term Loans, Additional Term Loans (if
any) and Refinancing Term Loans (if any)), with payment for such participations
to be made directly to Administrative Agent at the Domestic Funding and Payment
Office not later than 1:00 P.M. (New York time) on the Business Day next
succeeding the date notice to purchase such


 


85





















 


participations is given
by Administrative Agent.  Each Lender’s
obligation to purchase participations pursuant to this clause (C) and, so long
as the Revolving Loan Commitments are in effect and subject to the satisfaction
or waiver of the conditions set forth in subsection 3.2, to make Revolving
Loans pursuant to this clause (C), shall be absolute and unconditional and
shall not be affected by any circumstance, including, without limitation,
(i) any set-off, counterclaim, recoupment, defense or other right which
such Lender may have against Administrative Agent, any Loan Party or any other
Person for any reason whatsoever; (ii) the occurrence or continuance of an
Event of Default or a Potential Event of Default; (iii) any adverse change
in the condition (financial or otherwise) of any Loan Party; (iv) any
breach of this Agreement by any Loan Party or any other Revolving Lender; or
(v) any other circumstance, happening, or event whatsoever, whether or not
similar to any of the foregoing. In the event that any Lender fails to make
available to Administrative Agent the amount of any of such Lender’s Revolving
Loans required to be made pursuant to this clause (C) or the amount of any
participations in the Term Loans which are required to be purchased from
Administrative Agent by such Lender pursuant to this clause (C), Administrative
Agent shall be entitled to recover such amount on demand from such Lender
together with interest at the customary rate set by Administrative Agent for
the correction of errors among banks for three Business Days and thereafter at
the Base Rate.  Upon, and to the extent
of, any prepayment of the Term Loans pursuant to this clause (C), the Revolving
Loan Commitments shall no longer be restricted by the Acquisition Sublimit.


 


(e)  Prepayments
and Reductions from Net Debt Securities Proceeds Other Than From Receivables
Sale Indebtedness.  No later than the
third Business Day after the date of receipt by Holdings, Company or any of its
Subsidiaries (including Domestic Borrowers) of any Net Debt Securities Proceeds
(other than those arising from the issuance of Receivables Sale Indebtedness):


 


(1)           (i) the Borrowers shall prepay the
Term Loans in an amount equal to such Net Debt Securities Proceeds and (ii) the
Revolving Loan Commitments shall be permanently reduced by an amount equal to
the positive difference between the Net Debt Securities Proceeds and the
amounts thereof applied to the Term Loans under clause (i) of this subsection;
or


 


(2)           at the written election of Borrowers’
Agent delivered to Administrative Agent not later than the third Business Day
after receipt of such Net Debt Securities Proceeds, so long as the Reservation
Conditions are satisfied (and Borrower’s Agent has delivered an Officers’
Certificate to such effect), the Borrowers may (a) directly apply all or any
portion of such Net Debt Securities Proceeds to redeem, repay or repurchase
Existing


 


86





















 


Holdings Senior Notes due 2005 and, so long as the
outstanding principal amount of the Existing Holdings Senior Notes due 2005 is
$75,000,000 or less, to redeem, repay or otherwise repurchase Existing Holdings
Senior Notes due 2007 or (b) deposit all or any portion of such Net Debt
Securities Proceeds into the OI Grantor Collateral Account established with
Collateral Agent pursuant to Section 12 of the Security Agreement (such
amounts so deposited being referred to herein as the “Existing Holdings Senior Notes Redemption  Collateral Account”), with amounts therein
to be used thereafter solely to redeem, repurchase or otherwise repay Existing
Holdings Senior Notes due 2005, and, so long as the outstanding principal
amount of the Existing Holdings Senior Notes due 2005 is $75,000,000 or less,
to redeem, repay or otherwise repurchase Existing Holdings Senior Notes due
2007.  To the extent amounts deposited in
the Existing Holdings Senior Notes Redemption Collateral Account plus
any amounts then reserved to the Existing Holdings Senior Notes Redemption
Sublimit at any time exceed the aggregate outstanding principal amount of the
Existing Holdings Senior Notes due 2005 and 2007 by more than 10%, or at any
time at the election of the Borrowers’ Agent, the amount of such excess (or any
amount in the case of a Borrowers’ Agent election) shall be released to prepay
Term Loans and/or reduce Revolving Loan Commitments in accordance with clause
(1), above (except to the extent such payment is made pursuant to clause (3),
below); or


 


(3)           at the written election of Borrowers’
Agent delivered to Administrative Agent not later than the third Business Day
after receipt of such Net Debt Securities Proceeds, so long as the Reservation
Conditions are satisfied (and Borrowers’ Agent has delivered an Officers’
Certificate to such effect), an amount equal to the result of the following
calculation may be reserved within the Revolving Loan Commitments to each
Domestic Borrower as a subfacility thereunder (the “Existing Holdings Senior Notes Redemption Sublimit”):  the lesser of (i) such Net Debt Securities
Proceeds and (ii) the aggregate Revolving Loan Commitments (with any excess to
be applied pursuant to clause (1) or (2), above).  Except as set forth below, the portion of the
Revolving Loan Commitments reserved to the Existing Holdings Senior Notes Redemption
Sublimit under the preceding sentence may be used solely to redeem, repurchase
or otherwise repay Existing Holdings Senior Notes due 2005, and, so long as the
outstanding principal amount of the Existing Holdings Senior Notes due 2005 is
$75,000,000 or less, to redeem, repay or otherwise repurchase Existing Holdings
Senior Notes due 2007.  If, after giving
effect to such reservation, the Total Utilization of


 


87





















 


the Revolving Loan Commitments exceeds the amount of
the Revolving Loan Commitments, Domestic Borrowers shall immediately prepay the
Revolving Loans to the extent necessary so that Total Utilization of the
Revolving Loan Commitments does not exceed the amount of the Revolving Loan
Commitments.  To the extent amounts
reserved in the Existing Holdings Senior Notes Redemption Sublimit plus any
amount then deposited in the Existing Holdings Senior Notes Redemption
Collateral Account at any time exceed the aggregate outstanding principal
amount of the Existing Holdings Senior Notes due 2005 and 2007 by more than
10%, or at any time at the election of the Borrowers’ Agent, Borrowers shall
notify Administrative Agent thereof and prepay Term Loans and/or the Revolving
Loan Commitments shall be reduced in accordance with clause (1) above in an
amount equal to such excess (or any amount in the case of a Borrowers’ Agent
election) except to the extent such payment is made pursuant to clause (2)
above; provided, that, unless the Borrowers’ Agent shall have notified
Administrative Agent by 11:00 a.m. (New York time) on the Business Day
immediately following Borrowers’ delivery of notice to Administrative Agent of
such excess that Borrowers intend to make such repayment of the Term Loans with
funds other than the proceeds of Revolving Loans, the Domestic Borrowers shall
be deemed to have given a Notice of Borrowing to Administrative Agent
requesting Lenders to make Revolving Loans to the Borrowers which are Base Rate
Loans, on the date, in an amount equal to the lesser of (i) the amount of Term
Loans required to be prepaid pursuant to this clause (3), and (ii) the
aggregate amount of Term Loans outstanding, and, subject to satisfaction or
waiver of the conditions specified in subsection 3.2, Lenders shall, on
the date prepayment of the Term Loans is required by this clause (3), make
Revolving Loans to such Borrowers which are Base Rate Loans in such amount as
aforesaid, the proceeds of which shall be applied directly by Administrative
Agent to prepay Term Loans as required by this clause (3); provided, further,
that, if, as of the date such Revolving Loans are to be made, the
Revolving Loan Commitments have terminated due to an Event of Default or the
conditions specified in subsection 3.2 have not been satisfied or waived,
each Revolving Lender shall purchase its Pro Rata Share (determined with
respect to Revolving Loans) of participations in the Term Loans in an aggregate
amount equal to that portion of the Existing Holdings Senior Notes Redemption
Sublimit that bears the same ratio to the total Existing Holdings Senior Notes
Redemption Sublimit as the outstanding Term Loans bear to an amount equal to
the sum of all Loans then outstanding plus the total Existing Holdings Senior
Notes Redemption Sublimit (with such participation allocated


 


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ratably among the outstanding Tranche A1 Term Loans,
Tranche B1 Term Loans, Tranche C Term Loans, Additional Term Loans (if any) and
Refinancing Term Loans (if any)), with payment for such participations to be
made directly to Administrative Agent at the Domestic Funding and Payment
Office not later than 1:00 P.M. (New York time) on the Business Day next
succeeding the date notice to purchase such participations is given by Administrative
Agent.  Each Lender’s obligation to
purchase participations pursuant to this clause (3) and, so long as the
Revolving Loan Commitments are in effect and subject to the satisfaction or
waiver of the conditions set forth in subsection 3.2, to make Revolving
Loans pursuant to this clause (3), shall be absolute and unconditional and
shall not be affected by any circumstance, including, without limitation,
(i) any set-off, counterclaim, recoupment, defense or other right which
such Lender may have against Administrative Agent, any Loan Party or any other
Person for any reason whatsoever; (ii) the occurrence or continuance of an
Event of Default or a Potential Event of Default; (iii) any adverse change
in the condition (financial or otherwise) of any Loan Party; (iv) any
breach of this Agreement by any Loan Party or any other Revolving Lender; or
(v) any other circumstance, happening, or event whatsoever, whether or not
similar to any of the foregoing. In the event that any Lender fails to make
available to Administrative Agent the amount of any of such Lender’s Revolving
Loans required to be made pursuant to this clause (3) or the amount of any
participations in the Term Loans which are required to be purchased from
Administrative Agent by such Lender pursuant to this clause (3), Administrative
Agent shall be entitled to recover such amount on demand from such Lender
together with interest at the customary rate set by Administrative Agent for
the correction of errors among banks for three Business Days and thereafter at
the Base Rate.  Upon, but only to the
extent of, any prepayment of the Term Loans pursuant to this clause (3), the
Revolving Loan Commitments shall no longer be restricted by the Existing
Holdings Senior Notes Redemption Sublimit; or


 


(4)           at
the written election of Borrowers’ Agent delivered to Administrative Agent not
later than the third Business Day after receipt of such Net Debt Securities
Proceeds, so long as in the case of Net Debt Securities Proceeds from the
issuance of secured New Senior Debt, the conditions described in clauses (ii)
and (iii) of the definition of “Reservation Conditions” are satisfied (and
Borrowers’ Agent has delivered an Officers’ Certificate to such effect), the
Borrowers may (a) directly apply all or any part of such Net Debt Securities
Proceeds to redeem, repay or repurchase BSN Senior Subordinated Notes or (b) deposit
all or any portion of such Net Debt Securities Proceeds into the OI Grantor
Collateral


 


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Account established with Collateral Agent pursuant to
Section 12 of the Security Agreement (such amounts so deposited being
referred to herein as the “BSN Senior Subordinated
Notes Redemption  Collateral Account”), with amounts therein
to be used thereafter solely to redeem, repurchase or otherwise repay BSN
Senior Subordinated Notes.  To the extent
amounts deposited in the BSN Senior Subordinated Notes Redemption Collateral
Account at any time exceed the aggregate outstanding principal amount of the
BSN Senior Subordinated Notes by more than 10%, or at any time at the election
of the Borrowers’ Agent, the amount of such excess (or any amount in the case
of a Borrowers’ Agent election) shall be released to prepay Term Loans and/or
reduce Revolving Loan Commitments in accordance with clause (1), above.


 


(f)  Prepayments and Reductions from
Net Debt Securities Proceeds from Receivables Sale Indebtedness.  No later than the third Business Day after
the date of receipt by Holdings, Company or any of its Domestic Subsidiaries
(including Domestic Borrowers) of any Net Debt Securities Proceeds arising from
the issuance of Receivables Sale Indebtedness: (A) the Borrowers shall
prepay the Term Loans in an amount equal to the lesser of (x) the Net Debt
Securities Proceeds permitted to be applied to the Loans under the terms of the
Intercreditor Agreement and (y) the aggregate amount outstanding under the Term
Loans, and (B) the Revolving Loan Commitments shall be permanently reduced by
an amount equal to the positive difference between the Net Debt Securities
Proceeds permitted to be applied to the Loans under the terms of the
Intercreditor Agreement and the amounts applied to the Term Loans under the
foregoing clause (A).


 


(g)  Prepayments
due to Excess Total Utilization.  Domestic
Borrowers shall make such prepayments of Revolving Loans (and cause the
relevant Offshore Borrowers to make prepayments of Offshore Revolving Loans) to
the extent necessary so that the Total Utilization of Revolving Loan
Commitments at any time does not exceed the Revolving Loan Commitments then in
effect.  United Glass shall make
prepayments of the UK Revolving Loans to the extent necessary so that the Total
Utilization of UK Revolving Loan Commitments does not exceed the Offshore
Sublimit then in effect for United Glass. The Australian Offshore Borrowers
shall make prepayments of the Australian Revolving Loans to the extent
necessary so that the Total Utilization of Australian Revolving Loan
Commitments does not exceed the Offshore Sublimit then in effect for the
Australian Offshore Borrowers.  Avir
shall make prepayments of the Italian Revolving Loans to the extent necessary
so that the Total Utilization of Italian Revolving Loan Commitments does not
exceed the Offshore Sublimit then in effect for Avir. O-I Canada shall make
prepayments of the Canadian Revolving Loans to the extent necessary so that the
Total Utilization of Canadian Revolving Loan Commitments does not exceed the
Offshore Sublimit then in effect for O-I Canada.


 


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(h)  Officer’s
Certificate.  Concurrently with any
prepayment of the Loans and/or reduction of the Revolving Loan Commitments
pursuant to subsections 2.4B(ii)(a)-(f), Domestic Borrowers shall deliver to
Administrative Agent an Officer’s Certificate demonstrating the calculation of
the amount of the applicable Net Asset Sale Proceeds, Consolidated Excess Cash
Flow, Net Insurance/Condemnation Proceeds, Net Equity Securities Proceeds or
Net Debt Securities Proceeds, as the case may be, that gave rise to such
prepayment and/or reduction.  In the
event that the Domestic Borrowers shall subsequently determine that the actual
amount was greater than the amount set forth in such Officer’s Certificate
(including, in the case of the Plastics Sale, due to the receipt of any net
positive amount of purchase price adjustments by Company or its Subsidiaries
under Section 1.3 of the Plastics Sale Agreement in excess of $25,000,000, with
such proceeds applied to the Term Loans in the same manner as the other Net
Asset Sale Proceeds arising from the Plastics Sale pursuant to the Second
Amended and Restated Credit Agreement, as amended by the First Amendment), Domestic
Borrowers shall promptly cause an additional prepayment of the Loans (and/or,
if applicable, the Revolving Loan Commitments shall be permanently reduced
and/or the Existing Holdings Senior Notes Redemption Sublimit and/or
Acquisition Sublimit may be increased, as the case may be) in an amount equal
to the amount of such excess, and Domestic Borrowers shall concurrently
therewith deliver to Administrative Agent an Officer’s Certificate
demonstrating the derivation of the additional amount resulting in such excess.


 


(iii)          Application of Prepayments.  Any voluntary prepayments pursuant to subsection 2.4B(i)
shall be applied as specified by the applicable Borrower in the applicable
notice of prepayment; provided that in the event the applicable Borrower fails
to specify the Loans to which any such prepayment by it shall be applied, such
prepayment shall be first to repay outstanding Revolving Loans to the
full extent thereof, second to repay outstanding Term Loans ratably, in
accordance with their respective outstanding principal balances to the full
extent thereof, and third to the L/C Collateral Account until the L/C
Collateral Account holds an amount equal to the Aggregate Available Amount (as
defined in the Security Agreement); provided that if no order is
specified, voluntary prepayments applicable to the Revolving Loans hereunder
shall be applied pro rata among all Revolving Loans and, in the case of
Offshore Borrowers, to prepay Offshore Revolving Loans.  Any mandatory prepayment pursuant to
subsections 2.4B(ii)(a)-(f) shall be applied as set forth in such subsections; provided
that mandatory prepayments of the Term Loans shall be made ratably among the
Tranche A1 Term Loans, Tranche B1Term Loans, Tranche C Term Loans, Additional
Term Loans (if any) and Refinancing Term Loans (if any) in accordance with
their respective outstanding principal amounts at the time of payment and shall
reduce the scheduled installments of principal of the applicable Term Loans set
forth in subsection 2.4B pro rata to all remaining installments (except
for mandatory prepayments of Term Loans under subsection 2.4B(ii)(b),
which shall be applied to all such installments in forward order of maturity); provided
further, if at the time of such mandatory prepayment, the Term Loans
have been repaid in full and (to the extent such prepayment is required to be
applied to the Revolving Loan Commitments) the amount of such prepayment
exceeds the sum of the Revolving Loan Commitments then in effect the amount by
which such prepayment exceeds such amount shall be applied to the L/C
Collateral Account until the L/C Collateral Account holds an amount equal to
the Aggregate Available Amount (as


 


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defined
in the Security Agreement).  Any
mandatory prepayment of any Type of Term Loans, Revolving Loans or Offshore
Revolving Loans shall be applied first to Base Rate Loans of the applicable
Type to the full extent thereof before application to Euro Rate Loans of such
Type as determined by Administrative Agent, in each case in a manner which
minimizes the amount of any payments required to be made by the applicable
Borrowers pursuant to subsection 2.6E. 
All prepayments of Euro Rate Loans Term Loans and Offshore Revolving
Loans shall include payment of accrued interest on the principal amount so
prepaid and shall be applied to payment of interest before application to
principal.  For purposes of this
subsection 2.4B(iii), the outstanding principal balance of the French Tranche
C2 Term Loans shall be deemed to be the Dollar Equivalent of the outstanding principal
balance of such Term Loans as of the date of the applicable voluntary or
mandatory prepayment to be applied to repay Term Loans in accordance with this
subsection 2.4B(iii).  Amounts to be
applied to French Tranche C2 Term Loans pursuant to this subsection 2.4B(iii)
received by the Administrative Agent in Dollars shall be converted by the
Administrative Agent into Euros at the Spot Rate on the date of application.


 


(iv)          Notwithstanding anything in the
foregoing Section 2.4B, any mandatory or optional prepayment of Tranche A1 Term
Loans in either case that results in the prepayment of all, but not less than
all, outstanding Tranche A1 Term Loans prior to June 21, 2005 with the proceeds
of new term loans under this Agreement that have an applicable rate that is
less than the rate currently calculated using the Applicable Euro Margin or
Applicable Base Rate Margin for Tranche A1 Term Loans as of the Third
Restatement Date may only be made if each Tranche A1 Lender is paid a
prepayment premium of 1% of the principal amount of such Lender’s Tranche A1
Term Loans.  Any mandatory or optional
prepayment of Tranche B1 Term Loans in either case that results in the
prepayment of all, but not less than all, outstanding Tranche B1 Term Loans
prior to June 21, 2005 with the proceeds of new term loans under this Agreement
that have an applicable rate that is less than the rate currently calculated
using the Applicable Euro Margin or Applicable Base Rate Margin for Tranche B1
Term Loans as of the Third Restatement Date may only be made if each Tranche B1
Lender is paid a prepayment premium of 1% of the principal amount of such
Lender’s Tranche B1 Term Loans.  Any
mandatory or optional prepayment of any Type of Tranche C Term Loans in either
case that results in the prepayment of all, but not less than all, outstanding
Tranche C Term Loans of such Type prior to June 21, 2005 with the proceeds of
new term loans under this Agreement that have an applicable rate that is less
than the rate currently calculated using the Applicable Euro Margin or
Applicable Base Rate Margin for such Type of Tranche C Term Loans as of the Third
Restatement Date may only be made if each Tranche C Term Loan Lender having
Tranche C Term Loans of such Type is paid a prepayment premium of 1% of the
principal amount of such Lender’s Tranche C Term Loans of such Type.


 


C.    Manner and Time of Payment.  Except as provided in the immediately
succeeding sentence with respect to UK Revolving Loans and in subsection 2.7C
or 2.8E, all payments of principal, interest and fees hereunder and under the Loans
by Borrowers shall be made without defense, setoff, counterclaim or other
deduction and in Same Day Funds and delivered to Administrative Agent not later
than 12:00 Noon (New York time) on the date due at the Domestic Funding and
Payment Office for the account of Lenders, in Dollars (except for payments in
respect of the French Tranche C2 Term Loans, which shall be made in Euros);
funds received by Administrative Agent after the applicable time shall be
deemed to have been paid by the relevant Borrower on the next succeeding
Business Day.  All payments with respect
to UK


 


92





















 


Revolving
Loans by UK Borrowers shall be made without defense, setoff, counterclaim or
other deduction (except to the extent required by law) and in Same Day Funds
and delivered to UK Administrative Agent not later than 12:00 noon (London
time) on the date due at the UK Funding and Payment Office for the account of
Lenders, in Dollars; funds received by UK Administrative Agent after the
applicable time shall be deemed to have been paid by the relevant Borrower on
the next succeeding Business Day.  UK
Administrative Agent shall distribute to each Lender having a UK Lending Office
its Pro Rata Share of the amount so received to such Lender’s UK Lending Office
and shall transfer the remaining balance to Administrative Agent for
distribution to all other Lenders. 
Company and each Borrower hereby authorize Administrative Agent and the
UK Administrative Agent to charge their accounts with Administrative Agent or
the UK Administrative Agent, as the case may be, in order to cause timely
payment to be made to Administrative Agent or the UK Administrative Agent, as
the case may be, of all principal, interest and fees due hereunder (subject to
sufficient funds being available in its accounts for that purpose); provided
that Administrative Agent or the UK Administrative Agent, as the case may be,
shall give Company or the Borrower whose accounts are being so charged notice
of such charges prior thereto or as soon as reasonably practicable thereafter.


 


D.    Apportionment of Payments.  Aggregate principal and interest payments in
respect of Term Loans and Revolving Loans and, to the extent payments are made
by Borrowers after payments have been made by Lenders pursuant to
subsection 2.8E, payments in respect of Letters of Credit, shall be
apportioned among the Term Loans, Revolving Loans and Letters of Credit to
which such payments relate, payments of the aggregate facility fees and Letter
of Credit commissions shall be apportioned ratably among Revolving Lenders, in
each case proportionally to their respective Pro Rata Shares.  All principal and interest payments in
respect of the Domestic Overdraft Account shall be transferred to and retained
by Administrative Agent; provided that Administrative Agent shall
distribute to each Lender that has purchased a participation in amounts due
with respect to the Domestic Overdraft Account pursuant to subsection 2.1B
such Lender’s Pro Rata Share of any payments subsequently received by
Administrative Agent in respect of such amounts due with respect to the
Domestic Overdraft Account.  All
principal and interest payments in respect of any Offshore Overdraft Account
shall be transferred to and retained by the relevant Offshore Overdraft Account
Provider; provided that such Offshore Overdraft Account Provider shall
transfer to the Administrative Agent that portion of any payments subsequently
received by such Offshore Overdraft Account Provider in respect of amounts due
with respect to such Offshore Overdraft Account necessary to permit
Administrative Agent to distribute to each Lender that has purchased a
participation in such amounts due pursuant to subsection 2.1D such Lender’s
Pro Rata Share of such payments. 
Aggregate principal and interest payments in respect of Offshore
Revolving Loans shall be apportioned among the Offshore Revolving Loans to
which such payments relate, in each case proportionally to the relevant Lenders’
respective Pro Rata Shares.  Subject to
the provisions of subsection 2.4C relating to amounts received by the UK
Administrative Agent, Administrative Agent (or, in the case of payments
received by any Issuing Lender from a Borrower after payments have been made to
such Issuing Lender by Lenders pursuant to subsection 2.8C, such Issuing
Lender) shall promptly distribute to each Lender, at its primary address set
forth below its name on the appropriate signature page hereof or at such other
address as any Lender may request, its share of all such payments in respect of
Term Loans, Revolving Loans, Letters of Credit, the Domestic Overdraft Account,
the Offshore Overdraft Accounts and Offshore


 


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Revolving
Loans received by Administrative Agent (or such Issuing Lender) and the
facility fees of such Lender when received by Administrative Agent pursuant to
subsection 2.3A.  Notwithstanding
the foregoing provisions of this subsection 2.4D, (i) with respect to any
Lender which fails to fund the purchase of all or any part of its participation
in a Letter of Credit as required by subsection 2.8C, its participation in
the Domestic Overdraft Amount as required under subsection 2.1B, its
participation in an Offshore Overdraft Amount as required under
subsection 2.1D or its participation in the Term Loans pursuant to
subsection 2.4B(ii)(d) or 2.4B(ii)(e) (such Lender being a “Defaulting Participating Lender”), all amounts which would
otherwise be payable or allocable to such Defaulting Participating Lender under
this subsection 2.4D shall instead be paid by Administrative Agent to the
Issuing Lender (in the case of a failure to fund the purchase of a
participation in a Letter of Credit under subsection 2.8E), Administrative
Agent (in the case of a failure to fund the purchase of a participation in the
Domestic Overdraft Amount under subsection 2.1B) the applicable Offshore
Overdraft Account Provider (in the case of a failure to fund a purchase of a
participation in an Offshore Overdraft Amount under subsection 2.1D), or
to the Lenders having Term Loan Exposure (in the case of a failure to fund a
purchase of a participation in the Term Loans pursuant to subsection 2.4B(ii)(d)
or 2.4B(ii)(e) (each, a “Recipient”),
until such Recipient has received, either pursuant to this proviso or otherwise
from such Defaulting Participating Lender, an amount equal to the amount such
Defaulting Participating Lender failed to so fund plus interest at the
customary rate set by such Recipient for the correction of errors among banks
for three Business Days and thereafter at the Base Rate plus the Applicable
Base Rate Margin (and in the case such Defaulting Participating Lender is a
Defaulting Participating Lender with respect to more than one Recipient, such
amounts shall be paid to such Recipients ratably in accordance with amounts
owed to such Recipients by such Defaulting Participating Lender); (ii) if,
pursuant to the provisions of subsection 2.6D, any Notice of Borrowing or
Notice of Conversion/Continuation is withdrawn as to any Affected Lender or if
any Affected Lender makes Base Rate Loans in lieu of its Pro Rata Share of Euro
Rate Loans, Administrative Agent shall give effect thereto in apportioning
payments received thereafter and (iii) after the occurrence of an Event of
Default and acceleration of the maturity of the Loans and amounts available for
drawing under Letters of Credit as provided in Section 7, Administrative Agent
shall apportion all payments received by it in the manner specified in Section
7 and Section 2.10.


 


E.     Payments on Non-Business Days.  Whenever any payment to be made hereunder or
under the Notes shall be stated to be due on a day which is not a Business Day,
the payment shall be made on the next succeeding Business Day and such
extension of time shall be included in the computation of the payment of
interest hereunder or under the Notes or of the facility fees and other fees
hereunder, as the case may be.


 


F.     Notation of Payment.  Each Lender agrees that before disposing of
any Note held by it, or any part thereof (other than by granting participations
therein or to a Federal Reserve Bank pursuant to subsection 10.2D), that
Lender will make a notation thereon of all Loans and principal payments
previously made thereon and of the date to which interest thereon has been paid
and will notify the Borrower obligated under such Note and Administrative Agent
of the name and address of the transferee of that Note; provided that
the failure to make (or any error in the making of) a notation of any Loan made
under such Note or to notify such Borrower or Administrative Agent of the name
and address of such transferee shall not limit or otherwise


 


94





















 


affect
the obligation of such Borrower hereunder or under such Note with respect to
any Loan and payments of principal or interest on any such Note.


 


G.    Voluntary Reductions of Commitments and
Offshore Sublimits.  Borrowers’ Agent
shall have the right, at any time and from time to time, (i) to terminate in
whole or permanently reduce in part, without premium or penalty, the Revolving
Loan Commitments in an amount up to the amount by which the Revolving Loan
Commitments exceed the Total Utilization of Revolving Loan Commitments at the
time of such proposed termination or reduction, (ii) to terminate in whole or
reduce in part, without premium or penalty, the UK Revolving Loan Commitments
in an amount up to the amount by which the UK Revolving Loan Commitments exceed
the Total Utilization of UK Revolving Loan Commitments at the time of such
proposed termination or reduction, (iii) to terminate in whole or reduce in
part, without premium or penalty, the Australian Revolving Loan Commitments in
an amount up to the amount by which the Australian Revolving Loan Commitments
exceed the Total Utilization of Australian Revolving Loan Commitments at the
time of such proposed termination or reduction, and (iv) to terminate in
whole or reduce in part, without premium or penalty, the Canadian Revolving
Loan Commitments in an amount up to the amount by which the Canadian Revolving
Loan Commitments exceed the Total Utilization of the Canadian Revolving Loan
Commitments at the time of such proposed termination or reduction, (v) to
terminate in whole or reduce in part, without premium or penalty, the Italian
Revolving Loan Commitments in an amount up to the amount by which the Italian
Revolving Loan Commitments exceed the Total Utilization of Italian Revolving
Loan Commitments at the time of such proposed termination or reduction.


 


Borrowers’ Agent shall give not less than three
Business Days’ prior written notice to Administrative Agent designating the
date (which shall be a Business Day) of such termination or reduction and the
amount of any partial reduction. 
Promptly after receipt of a notice of such termination or partial
reduction, Administrative Agent shall notify each Lender of the proposed
termination or partial reduction.  Such
termination or partial reduction of any of the Offshore Revolving Loan
Commitments or the Revolving Loan Commitments shall be effective on the date
specified in the notice delivered by Borrowers’ Agent and shall reduce the
applicable Offshore Revolving Loan Commitment or the Revolving Loan Commitment,
as the case may be, of each Lender proportionately to its Pro Rata Share.  Any such partial reduction of the Revolving
Loan Commitments or the Offshore Revolving Loan Commitments shall be in an
aggregate minimum amount of $5,000,000, and integral multiples of $1,000,000 in
excess of that amount.


 


2.5          Use of Proceeds


 


A.    Revolving Loans and Offshore Revolving
Loans; Additional Term Loans; Refinancing Term Loans.  The proceeds of any Revolving Loans shall be
used to provide for the working capital requirements and general corporate
purposes of Borrowers and their Subsidiaries, which may include the payment of
the Domestic Overdraft Amount pursuant to subsection 2.1B, the
reimbursement to any Issuing Lender of any amounts drawn under any Letters of
Credit issued by such Issuing Lender for the account of a Domestic Borrower as
provided in subsection 2.8D, the payment or prepayment of the Term Loans,
the making of intercompany loans and dividends to Company and its Subsidiaries
for their own general corporate purposes and the making of other Restricted
Junior Payments permitted by subsection


 


95





















 


6.5,
except that the proceeds of any Revolving Loans made under the Existing
Holdings Senior Notes Redemption Sublimit may be used solely to redeem, repay
or otherwise repurchase the Existing Holdings Senior Notes maturing in 2005 or
2007 to the extent not prohibited under subsection 6.12B or to repay Loans as
described in subsection 2.4B(ii)(e), and the proceeds of any Revolving Loans
made under any Acquisition Sublimit may be used solely to finance a Permitted
Acquisition or repay Loans.  In addition,
the proceeds of Revolving Loans (other than any such Loans made under the
Existing Holdings Senior Notes Redemption Sublimit) may only be used to redeem,
repay or otherwise repurchase (A) Existing Holdings Senior Notes maturing in
2005 (or make Restricted Junior Payments to Holdings for the purpose of doing
same), whether at maturity or otherwise, if after giving effect to the making
of such Revolving Loans and the application of the proceeds thereof, the
Consolidated Senior Secured Leverage Ratio is less than 2.85:1.00 and the
Revolving Loan Commitments then in effect would exceed the Total Utilization of
Revolving Loan Commitments by at least (a) $250,000,000 or (b) solely in the
case of proceeds of Revolving Loans of up to $250,000,000 in the aggregate
drawn on or after May 2, 2005 to redeem, repurchase or otherwise repay such
Existing Holdings Senior Notes maturing in 2005, $150,000,000, or (B) Existing
Holdings Senior Notes maturing in 2007 (or make Restricted Junior Payments to
Holdings for the purpose of doing same), whether at maturity or otherwise, if
(i) the outstanding principal balance of the Existing Holdings Senior Notes
maturing in 2005 is $75,000,000 or less and (ii) after giving effect to the
making of such Revolving Loans and the application of the proceeds thereof, the
Revolving Loan Commitments then in effect would exceed the Total Utilization of
Revolving Loan Commitments by at least $250,000,000 and the Consolidated Senior
Secured Leverage Ratio is less than 2.85:1.00. 
Except as expressly permitted above, amounts in the Existing Holdings
Senior Notes Redemption Sublimit or any Acquisition Sublimit may not be
reborrowed.  The proceeds of any Offshore
Revolving Loans to any Offshore Borrower shall be used to provide for the
working capital requirements and general corporate purposes of such Offshore
Borrower and its Subsidiaries, which may include the payment of Offshore
Overdraft Amounts pursuant to subsection 2.1D, the reimbursement to any
Issuing Lender of any amounts drawn under any Letters of Credit issued by such
Issuing Lender for the account of an Offshore Borrower as provided in
subsection 2.8D and the making and repayment of intercompany loans to such
Subsidiaries for their own general corporate purposes.  The proceeds of any Additional Term Loans or
Refinancing Term Loans may be used for any purpose permitted by this Agreement;
provided, that, the proceeds of any Additional Term Loans or
Refinancing Term Loans may only be used to redeem, repay or otherwise
repurchase the Existing Holdings Senior Notes maturing in 2005 or 2007 or the
BSN Senior Subordinated Notes if, after giving effect to the making of such
Loans and the application of the proceeds thereof, the Senior Secured Leverage
Ratio is less than 2.85:1.00 and, in the case of a redemption, repayment or
repurchase of the BSN Senior Subordinated Notes, the Revolving Loan Commitments
exceed the Total Utilization of the Revolving Loan Commitments by at least
$250,000,000.


 


B.    Letters of Credit.  Letters of Credit shall be issued solely for
the purposes specified in the definitions of Commercial Letter of Credit and
Standby Letter of Credit.


 


C.    Margin Regulations.  No portion of the proceeds of any borrowing
under this Agreement shall be used by any Borrower in any manner which would
cause the borrowing or the application of such proceeds to violate Regulation
U, Regulation T, or Regulation X of the Board of Governors of the Federal
Reserve System or any other regulation of such Board or to


 


96





















 


violate
the Exchange Act, in each case as in effect on the date or dates of such
borrowing and such use of proceeds.


 


2.6          Special Provisions Governing Euro Rate
Loans


 


Notwithstanding other provisions of this Agreement,
the following provisions shall govern with respect to Euro Rate Loans as to the
matters covered:


 


A.    Determination of Interest Rate.  As soon as practicable after 11:00 A.M. (New
York time) on each Interest Rate Determination Date with respect to Eurodollar
Rate Loans and 11:00 A.M. (Brussels time) with respect to Euro LIBOR Loans,
Administrative Agent shall determine (which determination shall, absent
manifest or demonstrable error, be final, conclusive and binding upon all parties)
the interest rate which shall apply to the Euro Rate Loans for which an
interest rate is then being determined for the applicable Interest Period
(subject to any changes in the Applicable Euro Margin pursuant to the terms of
the definition thereof) and shall promptly give notice thereof (in writing or by
telephone and confirmed in writing) to the applicable Borrowers and to each
Lender.


 


B.    Substituted Rate of Borrowing.  In the event that on any Interest Rate
Determination Date any Lender (including Administrative Agent) shall have
determined (which determination shall, absent manifest or demonstrable error,
be final and conclusive and binding upon all parties but, with respect to the
following clauses (i) and (ii)(b), shall be made only after consultation with
the applicable Borrower and Administrative Agent) that:


 


(i)            by reason of any changes arising
after the date of this Agreement affecting the applicable interbank markets or
affecting the position of that Lender in such market, adequate and fair means
do not exist for ascertaining the applicable interest rate on the basis
provided for in the definition of Adjusted Eurodollar Rate or Euro LIBOR with
respect to the Euro Rate Loans as to which an interest rate determination is
then being made; or


 


(ii)           by reason of (a) any change
after the date hereof in any applicable law or governmental rule, regulation or
order (or any interpretation thereof and including the introduction of any new
law or governmental rule, regulation or order) or (b) other circumstances
affecting that Lender or the Eurodollar or Euro LIBOR markets or the position
of that Lender in such market (such as for example, but not limited to,
official reserve requirements required by Regulation D or by the Bank of
England, the Financial Services Authority, the European Central Bank or any
other relevant monetary or regulatory authority to the extent not given effect
in the Adjusted Eurodollar Rate), the Adjusted Eurodollar Rate shall not
represent the effective pricing to that Lender for Dollar deposits of
comparable amounts for the relevant period, or Euro LIBOR shall not represent
the effective pricing to that Lender for Euro deposits of comparable amounts
for the relevant period;


 


then, and in any such event, that Lender shall be an
Affected Lender and it shall promptly (and in any event as soon as possible
after being notified of a borrowing, conversion or continuation) give notice (by
telephone and confirmed in writing) to the applicable Borrower and


 


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Administrative Agent (which notice Administrative
Agent shall promptly transmit to each other relevant Lender) of such
determination.  Thereafter, the
applicable Borrower shall pay to the Affected Lender with respect to such
Borrower’s Euro Rate Loans, upon written demand therefor, such additional
amounts (in the form of an increased rate of, or a different method of
calculating, interest or otherwise as the Affected Lender in its sole
discretion shall reasonably determine) as shall be required to cause the
Affected Lender to receive interest with respect to such Affected Lender’s Euro
Rate Loans for the Interest Period(s) following that Interest Rate
Determination Date at a rate per annum equal to the sum of the effective
pricing to the Affected Lender for Dollar deposits or Euro deposits, as
applicable, to make or maintain its Euro Rate Loans plus the Applicable
Euro Margin.  A certificate as to
additional amounts owed the Affected Lender, showing in reasonable detail the
basis for the calculation thereof, submitted in good faith to the relevant
Borrower and Administrative Agent by the Affected Lender shall, absent manifest
or demonstrable error, be final and conclusive and binding upon all of the
parties hereto.


 


C.    Required
Termination and Prepayment.  In the
event that on any date any Lender shall have reasonably determined (which
determination shall, absent manifest or demonstrable error, be final and
conclusive and binding upon all parties) that the making or continuation of its
Euro Rate Loans or Offshore Revolving Loans has become unlawful by compliance
by that Lender or its UK Lending Office in good faith with any law,
governmental rule, regulation or order (whether or not having the force of law
and whether or not failure to comply therewith would be unlawful), then, and in
any such event, that Lender shall be an Affected Lender and it shall promptly
give notice (by telephone and confirmed in writing) to the applicable Borrower,
Administrative Agent (which notice Administrative Agent shall promptly transmit
to each Lender) of that determination. 
Subject to the following subsection 2.6D, the obligation of the
Affected Lender to make or maintain its Euro Rate Loans or Offshore Revolving
Loans, as the case may be, during any such period shall be terminated at the
earlier of the termination of the Interest Period then in effect or when
required by law and Domestic Borrowers or the relevant Offshore Borrower shall,
no later than the termination of the Interest Period in effect at the time any
such determination pursuant to this subsection 2.6C is made, or earlier
when required by law, repay the Euro Rate Loans or Offshore Revolving Loans, as
the case may be, of the Affected Lender, together with all interest accrued
thereon.


 


D.    Options
of Borrowers.  In lieu of paying an
Affected Lender such additional moneys as are required by subsection 2.6B
or the prepayment of an Affected Lender required by subsection 2.6C,
Borrowers may exercise any one of the following options:


 


(i)            If the determination by an Affected
Lender relates only to Eurodollar Rate Loans then being requested by a Borrower
pursuant to a Notice of Borrowing or a Notice of Conversion/Continuation, such
Borrower may by giving notice (by telephone and confirmed in writing) to
Administrative Agent (who shall promptly give similar notice to each relevant
Lender) no later than the date immediately prior to the date on which such
Eurodollar Rate Loans are to be made, converted or continued, withdraw as to
the Affected Lender that Notice of Borrowing or such Notice of
Conversion/Continuation and such Affected Lender shall thereupon make or
maintain its Pro Rata Share of the Eurodollar Rate Loan then being requested,
converted or continued as a Base Rate Loan; or


 


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(ii)           Upon written notice to Administrative
Agent, the applicable Borrower may terminate the obligations of Lenders to make
or maintain Loans as, and to convert Loans into, Eurodollar Rate Loans and, in
any such event, the applicable Borrower shall, prior to the time any payment
pursuant to subsection 2.6C is required to be made or, if the provisions
of subsection 2.6B are applicable, at the end of the then current Interest
Period, convert all of the Eurodollar Rate Loans into Base Rate Loans in the
manner contemplated by subsection 2.2D but without satisfying the advance
notice requirements therein;


 


(iii)          The applicable Borrower may give
notice (by telephone and confirmed in writing) to the Affected Lender and
Administrative Agent and require the Affected Lender to make the Eurodollar
Rate Loan then being requested as a Base Rate Loan or to continue to maintain
its outstanding Base Rate Loan then the subject of a Notice of Conversion/
Continuation as a Base Rate Loan or to convert its Eurodollar Rate Loans then
outstanding that are so affected into Base Rate Loans at the end of the then
current Interest Period (or at such earlier time as prepayment is otherwise
required to be made pursuant to subsection 2.6C) in the manner
contemplated by subsection 2.2D but without satisfying the advance notice
requirements therein, that notice to pertain only to the Loans of the Affected
Lender and to have no effect on the obligations of the other Lenders to make or
maintain Eurodollar Rate Loans or to convert Base Rate Loans into Eurodollar
Rate Loans; or


 


(iv)          Solely with respect to the French
Tranche C2 Term Loans, the applicable Borrower may give notice (by telephone
and confirmed in writing) to the Affected Lender and Administrative Agent and
require the Affected Lender to make the Euro Rate Loan then being requested at
a rate determined by the Administrative Agent as the all-in-cost of funds for
such Affected Lender to fund a borrowing of Loans denominated in Euros with
maturities comparable to the Interest Period applicable thereto, so long as
such Affected Lender may legally do so.


 


E.     Compensation.  The applicable Borrower shall compensate each
Lender, upon written request by that Lender (which request shall set forth in
reasonable detail the basis for requesting such amounts), for all reasonable
losses, expenses and liabilities (including, without limitation, any interest
paid by that Lender to lenders of funds borrowed by it to make or carry its
Euro Rate Loans, and any loss sustained by that Lender in connection with the
re-employment of such funds), which that Lender may sustain with respect to
Borrowers’ Euro Rate Loans:  (i) if
for any reason (other than a default by that Lender) a borrowing of any Euro
Rate Loan does not occur on a date specified therefor in a Notice of Borrowing,
a Notice of Conversion/Continuation or a telephonic request for borrowing or
conversion/continuation or a successive Interest Period does not commence after
notice therefor is given pursuant to subsection 2.2D, (ii) if any
prepayment or other principal payment of any of its Euro Rate Loans occurs on a
date prior to the last day of the Interest Period applicable to that Loan,
(iii) if any prepayment of any of such Lender’s Euro Rate Loans is not
made on any date specified in a notice of prepayment given by the applicable
Borrower, or (iv) as a consequence of any other default by such Borrower to
repay such Lender’s Euro Rate Loans when required by the terms of this
Agreement.


 


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F.     Quotation
of Adjusted Eurodollar Rate. 
Anything herein to the contrary notwithstanding, if on any Interest Rate
Determination Date no Adjusted Eurodollar Rate is available by reason of the
failure of all Reference Lenders to provide offered quotations to
Administrative Agent in accordance with the definition of “Adjusted Eurodollar
Rate,” Administrative Agent shall give Borrowers and each Lender prompt notice
thereof and the Loans requested shall be made as Base Rate Loans.


 


G.    Booking
of Loans.  Any Lender may make, carry
or transfer Loans at, to, or for the account of, any of its branch offices or
the office of an Affiliate of that Lender. 
Each Revolving Lender (other than a Person exempt from Taxes with
respect to any payments to such Lender of interest payable by United Glass
under the Loan Documents) shall endeavor to designate a UK Lending Office for
the making of its UK Revolving Loans, so long as such Lender may legally do so
at no more than nominal cost and such designation is consistent with such
Lender’s internal policies.


 


H.    Assumptions
Concerning Funding of Eurodollar Rate Loans.  Calculation of all amounts payable to a
Lender under this subsection 2.6 shall be made with respect to Euro Rate
Loans, as though that Lender had actually funded its relevant Euro Rate Loan
through the purchase of a deposit bearing interest at the rate obtained
pursuant to clause (i) of the definition of Adjusted Eurodollar Rate or
pursuant to the definition of Euro LIBOR in an amount equal to the amount of
that Euro Rate Loan and having a maturity comparable to the relevant Interest
Period and through the transfer of such deposit from an offshore office of that
Lender to a domestic office of that Lender in the United States of America; provided
that to the extent that a Lender designates a UK Lending Office, it shall be
assumed that such Eurodollar deposit was used to directly fund the making of
the UK Revolving Loan in England; provided, further, however,
that each Lender may fund each of its Euro Rate Loans in any manner it sees fit
and the foregoing assumptions shall be utilized only for the calculation of
amounts payable under this subsection 2.6.


 


I.      Eurodollar
Rate Loans After Default.  Unless
Requisite Lenders shall otherwise agree, after the occurrence of and during the
continuance of an Event of Default, no Borrower may elect to have a Loan be
made or maintained as, or converted to, a Eurodollar Rate Loan after the
expiration of any Interest Period then in effect for that Loan.


 


J.     Affected
Lenders’ Obligation to Mitigate. 
Each Lender agrees that, as promptly as practicable after it becomes
aware of the occurrence of an event or the existence of a condition that would
cause it to be an Affected Lender under subsection 2.6B or 2.6C, it will,
to the extent not inconsistent with such Lender’s internal policies, use
reasonable commercial efforts to make, fund or maintain the affected Euro Rate
Loans of such Lender through another lending office of such Lender if as a
result thereof the additional moneys which would otherwise be required to be
paid in respect of such Loans pursuant to subsection 2.6B would be
materially reduced or the illegality or other adverse circumstances which would
otherwise require prepayment of such Loans pursuant to subsection 2.6C
would cease to exist and if, as determined by such Lender, in its sole
discretion, the making, funding or maintaining of such Loans through such other
lending office would not otherwise materially adversely affect such Loans or
such Lender.  The applicable Borrower hereby
agrees to pay all reasonable expenses incurred by any Lender in utilizing
another lending office of such Lender pursuant to this subsection 2.6J.


 


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K.    Replacement
of Lender.  If a Borrower receives a
notice pursuant to subsection 2.6B or 2.6C, so long as no Event of Default
shall have occurred and be continuing and the applicable Borrower has obtained
a commitment from another Lender or an Eligible Assignee to become a Lender for
all purposes under this Agreement and to assume all obligations of the Lender
to be replaced, the applicable Borrower may require the Lender giving such
notice to assign all of its Loans, its Commitments and its other Obligations to
such other Lender or Eligible Assignee, at par, pursuant to the provisions of
subsection 10.2B; provided that, prior to or concurrently with such
replacement (i) the applicable Borrower has paid or caused to be paid to
the Lender giving such notice all principal, interest, fees and other amounts
due and owing to such Lender hereunder through such date of replacement
(including any amounts payable under subsection 2.6E), (ii) the applicable
Borrower has paid to Administrative Agent the processing and recordation fee
required to be paid by subsection 10.2B(i); and (iii) all of the
requirements for such assignment contained in subsection 10.2B, including,
without limitation, the receipt by Administrative Agent of an executed
Assignment and Acceptance and other supporting documents, have been fulfilled.


 


L.    Calculation
of Spot Rates.  On each Calculation
Date with respect to any Offshore Currency or, in the case of a Letter of
Credit, other non-Dollar currency, the Administrative Agent shall determine the
Spot Rate as of such Calculation Date with respect to such currency (it being
acknowledged and agreed that Administrative Agent shall use the Spot Rates so
calculated for the purposes of determining compliance with subsection 2.1C
with respect to any borrowing request and subsection 2.8A(i) with respect to
any request for a Letter of Credit denominated in a non-Dollar currency).  Any Spot Rate so determined shall become
effective on the first Business Day immediately following the relevant
Calculation Date (each, a “Reset Date”)
and shall remain effective until the next succeeding Reset Date.  Administrative Agent shall promptly notify
Borrowers of each determination of a Spot Rate hereunder.


 


2.7          Capital
Adequacy Adjustment; Increased Costs; Taxes


 


A.    Capital
Adequacy.  If any Lender shall have
determined in good faith that the adoption, effectiveness, phase-in or
applicability (excluding any adoption, effectiveness, phase-in or applicability
published as of the Second Restatement Date and currently scheduled to take
effect) after the date hereof of any law, rule or regulation (or any provision
thereof) regarding capital adequacy, or any change therein or in the
interpretation or administration thereof after the date hereof by any
governmental authority, central bank or comparable agency charged with the interpretation
or administration thereof, or compliance by any Lender (or its applicable
lending office) with any guideline, request or directive regarding capital
adequacy (whether or not having the force of law) of any such governmental
authority, central bank or comparable agency, has or would have the effect of
reducing the rate of return on the capital of such Lender or any corporation
controlling such Lender as a consequence of, or with reference to, such Lender’s
Loans or Commitments or Letters of Credit or participations therein or other
obligations hereunder to a level below that which such Lender or such
controlling corporation could have achieved but for such adoption,
effectiveness, phase-in, applicability, change or compliance (taking into
consideration the policies of such Lender or such controlling corporation with
regard to capital adequacy), then from time to time, within fifteen Business
Days after receipt by Borrowers from such Lender of the statement referred to
in the next sentence, Borrowers shall pay to such Lender such additional amount
or amounts as will compensate such Lender or such


 


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controlling corporation
on an after-tax basis for such reduction; provided that a Lender shall
not be entitled to avail itself of the benefit of this subsection 2.7A to
the extent that any such reduction in return was incurred more than six months
prior to the time it first makes a demand therefor, unless the circumstance
giving rise to such reduced return arose or became applicable retrospectively,
in which case no time limit shall apply (provided that such Lender has
notified Borrowers within six months from the date such circumstances arose or
became applicable).  Each Lender, upon
determining in good faith that any additional amounts will be payable pursuant
to this subsection 2.7A, will give prompt written notice thereof to
Borrowers’ Agent (with a copy to Administrative Agent), which notice shall set
forth in reasonable detail the basis of the calculation of such additional
amounts.


 


B.    Compensation
for Increased Costs and Taxes. 
Subject to the provisions of subsection 2.7C (which shall be
conclusive with respect to the matters covered thereby), in the event that any
Lender shall determine in good faith (which determination shall, absent
manifest or demonstrable error, be final and conclusive and binding upon all
parties hereto) that any law, treaty or governmental rule, regulation or order,
or any change therein or in the interpretation, administration or application
thereof (including the introduction of any new law, treaty or governmental
rule, regulation or order), or any determination of a court or governmental
authority, in each case that is adopted after the date hereof, or compliance by
such Lender with any guideline, request or directive issued or made after the
date hereof by any central bank or other governmental or quasi-governmental
authority, including, without limitation, any agency of the European Monetary
Union (whether or not having the force of law):


 


(i)            subjects such Lender (or its
applicable lending office) to any additional Tax (other than any Excluded Tax
or Covered Tax subject to subsection 2.7C) with respect to this Agreement
or any of the Loans or any of its obligations hereunder, or changes the basis
of taxation of payments to such Lender (or its applicable lending office) of
principal, interest, fees or any other amount payable hereunder;


 


(ii)           imposes, modifies or holds applicable
any reserve (including without limitation any marginal, emergency,
supplemental, special or other reserve), special deposit, compulsory loan, FDIC
insurance or similar requirement against assets held by, or deposits or other
liabilities in or for the account of, or advances or loans by, or other credit
extended by, or any other acquisition of funds by, any office of such Lender
(other than any such reserve or other requirements with respect to Eurodollar
Rate Loans that are reflected in the definition of Adjusted Eurodollar Rate);
or


 


(iii)          imposes any other condition on or
affecting such Lender (or its applicable lending office) or its obligations
hereunder or any applicable interbank market, other than with respect to Taxes;


 


and the result of any of the foregoing is to increase
the cost to such Lender of agreeing to make, making or maintaining Loans
hereunder or to reduce any amount received or receivable by such Lender (or its
applicable lending office) with respect thereto; then, in any such case, Domestic
Borrowers shall promptly pay (or cause the applicable Offshore Borrower to
promptly pay) to such Lender, upon written demand and receipt of the written
notice referred to below, such


 


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additional amount or amounts (in the form of an
increased rate of, or a different method of calculating, interest or otherwise
as such Lender in its sole discretion shall determine) as may be necessary to
compensate such Lender on an after-tax basis for any such increased cost or
reduction in amounts received or receivable hereunder; provided that any
increased cost arising as a result of any of the foregoing other than in
respect of Taxes shall apply only to Euro Rate Loans; provided  further
that a Lender shall not be entitled to avail itself of the benefit of this subsection 2.7B
to the extent that any such increased cost or reduction was incurred more than
six months prior to the time it gives notice to Borrowers’ Agent (as provided
in the next sentence) of the relevant circumstance, unless such circumstance
arose or became applicable retrospectively, in which case no time limit shall
apply (provided that such Lender has notified Borrowers’ Agent within
six months from the date such circumstances arose or became applicable).  Such Lender shall deliver to Borrowers’ Agent
a written notice, setting forth in reasonable detail the basis for calculating
the additional amounts owed to such Lender under this subsection 2.7B,
which statement shall be conclusive and binding upon all parties hereto absent
manifest or demonstrable error.  If any
event described above would otherwise result in any Lender (or its applicable
lending office) being subject to any additional Tax or other cost for which a
Borrower would be required to indemnify such Lender under the provisions of
this subsection 2.7, then such Lender shall use its reasonable efforts to
avoid the imposition of such Taxes or other costs if doing so would not, in the
reasonable judgment of such Lender, be otherwise adverse to such Lender.


 


C.    Withholding
of Taxes.


 


(i)            Payments to Be Free and Clear.  Except to the extent required by law, all
sums payable by any Borrower under this Agreement and the other Loan Documents
shall be paid free and clear of and without any deduction or withholding on
account of any Covered Tax imposed, levied, collected, withheld or assessed by
or within the United States of America or any political subdivision in or of
the United States of America or any other jurisdiction from or to which a
payment is made by or on behalf of such Borrower or in respect of any
participation by any Lender in any Obligation or by any federation or
organization of which the United States of America or any such jurisdiction is
a member at the time of payment.


 


(ii)           Withholding in respect of Payments.  If any Borrower or any other Person is
required by law to make any deduction or withholding on account of any Tax from
any sum paid or payable by such Borrower or other Person to Administrative
Agent or any Lender under any of the Loan Documents:


 


(a)   such Borrower shall notify Administrative
Agent of any such requirement or any change in any such requirement as soon as
such Borrower becomes aware of it;


 


(b)   such Borrower shall pay any such Tax before
the date on which penalties attach thereto, such payment to be made (if the
liability to pay is imposed on a Borrower) for its own account or (if that
liability is imposed on Administrative Agent or such Lender, as the case may
be) on behalf of and in the name of Administrative Agent or such Lender;


 


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(c)   (1) with respect to any Borrower other than
an Australian Offshore Borrower, in the event such Tax is a Covered Tax, the
sum payable by such Borrower in respect of which the relevant deduction,
withholding or payment is required shall be increased to the extent necessary
to ensure that, after the making of that deduction, withholding or payment,
Administrative Agent or such Lender, as the case may be, receives on the due
date and retains (free from any liability in respect of any such deduction,
withholding or payment) a net sum equal to what it would have received and so
retained had no such deduction, withholding or payment in respect of Covered
Taxes been required or made; and (2) solely with respect to any Australian
Offshore Borrower and amounts payable thereby, in the event such Tax is a
Covered Tax, such Australian Offshore Borrower shall pay an additional amount
by way of indemnity so that the Administrative Agent or such Lender, as the
case may be, receives on the due date and retains (free and clear of any Tax on
such additional amount) the full amount it would have received and so retained
and had no such deduction, withholding or payment in respect of Covered Taxes
been required or made; each Australian Borrower (y) acknowledges that its
indemnity under paragraph (c) is a separate and independent obligation from its
obligation to pay interest in respect of the Tranche A1 Term Loans and
Australian Offshore Revolving Loans, and is not discharged by reason of its
withholding amounts on account of Australian withholding tax and remitting
those amounts to the Australian taxation authorities, and (z) subject to
subsection 2.7C(iii) below, waives any right which it may have (whether
under statute or otherwise) to be reimbursed by any Lender or Agent for any
amounts which it may from time to time pay under that indemnity; and


 


(d)   within 30 days after paying any sum from
which it is required by law to make any deduction or withholding, and within 30
days after the due date of payment of any Tax which it is required by clause
(b) above to pay, such Borrower shall deliver to Administrative Agent evidence
reasonably satisfactory to the other affected parties of such deduction,
withholding or payment and of the remittance thereof to the relevant taxing or
other authority;


 


The provisions of this
subsection 2.7C(ii) apply to any Australian interest withholding tax
(including fines and penalties), whether:


 


(1)                                  deducted
or remitted by an Australian Offshore Borrower, or


 


(2)                                  otherwise
recovered by the Australian taxation authorities from an Australian Offshore
Borrower, or


 


(3)                                  paid
directly by a Lender to the Australian taxation authorities, or


 


(4)                                  recovered
by the Australian taxation authorities either directly from a Lender or from
amounts payable by a Person in Australia to a Lender.


 


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(iii)          Tax Refund.  If any Borrower determines in good faith that
a reasonable basis exists for contesting a Covered Tax, the relevant Lender or
Tax Transferee or Administrative Agent, as applicable, shall cooperate with
such Borrower (but shall have no obligation to disclose any confidential
information, unless arrangements satisfactory to the relevant Lender have been
made to preserve the confidential nature of such information) in challenging
such Tax at such Borrower’s expense if requested by such Borrower (it being
understood and agreed that none of Administrative Agent or any Lender shall
have any obligation to contest, or any responsibility for contesting, any
Tax).  If a Lender shall become aware
that it is entitled to receive a refund (whether by way of a direct payment or
by offset) in respect of a Covered Tax paid by a Borrower, it shall promptly
notify such Borrower of the availability of such refund (unless it was made
aware of such refund by a Borrower) and shall, within 30 days after the receipt
of a request from such Borrower, apply for such refund at such Borrower’s sole
expense.  If any Lender, Tax Transferee
or Administrative Agent, as applicable, receives a refund (whether by way of a
direct payment or by offset) of any Covered Tax for which a payment has been
made pursuant to this subsection 2.7C or subsection 2.7B which, in
the reasonable good faith judgment of such Lender, Tax Transferee or
Administrative Agent, as the case may be, is allocable to such payment made
under this subsection 2.7C or subsection 2.7B, the amount of such
refund (together with any interest received thereon) shall be paid to such
Borrower to the extent payment has been made in full as and when required
pursuant to this subsection 2.7C or subsection 2.7B.


 


(iv)          Tax Certificates.  (1) Each Lender with Revolving Loan Commitments
or Tranche B1 Term Loans that is organized under the laws of any jurisdiction
other than the United States of America or any state or other political
subdivision thereof shall deliver to Administrative Agent for transmission to Domestic
Borrowers, on the date of the Assignment and Acceptance pursuant to which it
becomes a Lender (in the case of each other Lender), and at such other times as
may be necessary in the determination of Borrowers’ Agent or Administrative
Agent (each in the reasonable exercise of its discretion), such certificates,
documents or other evidence, properly and accurately completed and duly
executed by such Lender (including, without limitation, Internal Revenue
Service Form W-8BEN or Form W-8ECI or any other certificate or
statement of exemption required by Treasury Regulations
Section 1.1441-4(a) or Section 1.1441-6(c) or any successor thereto)
to establish that such Lender is not subject to deduction or withholding of
United States federal income tax under Section 1441 or 1442 of the
Internal Revenue Code or otherwise (or under any comparable provisions of any
successor statute) with respect to any payments to such Lender of principal,
interest, fees or other amounts payable under any of the Loan Documents and
shall deliver to the appropriate Person upon request such other certificates,
documents or other evidence as may be required from time to time, properly
completed and duly executed by such Lender, to establish the basis for any
applicable exemption from or reduction of such Taxes with respect to any
payments to such Lender of principal, interest, fees, commissions or any other
amount payable under any of the Loan Documents by a Domestic Borrower,
(2) each Lender (other than a Person exempt from Taxes with respect to any
payments to such Lender of interest payable by United Glass under the Loan
Documents) shall deliver to the appropriate Person such application forms,


 


105





















 


certificates, documents or other evidence as may be
reasonably requested from time to time by United Glass, properly completed and
duly executed by such Lender, to enable United Glass, to the extent permitted
by applicable law, to be able to pay interest on the UK Revolving Loans of such
Lender without withholding or deduction, or at reduced rates of withholding or
deduction, for or on account of any UK income tax and (3) each Lender with
French Tranche C1 Term Loan Exposure or French Tranche C2 Term Loan Exposure
shall deliver to the appropriate Person such application forms, certificates,
documents or other evidence as may be reasonably requested from time to time by
BSN, properly completed and duly executed by such Lender, to enable BSN, to the
extent permitted by applicable law, to be able to pay interest on the French
Tranche C1 Term Loans and French Tranche C2 Term Loans of such Lender without
withholding or deduction, or at reduced rates of withholding or deduction, for
or on account of any French income tax.


 


Each
Arranger will cooperate with the Australian Offshore Borrowers, and it will do
or provide such other things as may be reasonably requested from time to time
by the Australian Offshore Borrowers, to demonstrate that the requirements of
section 128F of the Income Tax Assessment Act of 1936 (Commonwealth of
Australia) were satisfied in relation to the respective issues of “Australian
Loans” and the “Australian Loan Notes” under the Original Credit Agreement, the
“Tranche A Term Loans” and the notes evidencing such “Tranche A Term Loans”
under the First Amended and Restated Credit Agreement as in effect prior to the
December 2003 Amendment, the Tranche A1 Term Loans, the Australian
Revolving Loans, the Tranche A1 Term Loan Notes, and the Australian
Revolving Loan Notes under the First Amended and Restated Credit Agreement as
in effect after the December 2003 Amendment, and the Tranche A1 Term Loans, the
Australian Revolving Loans, the Tranche A1 Term Loan Notes and the Australian
Revolving Loan Notes under the Second Amended and Restated Credit Agreement and
under this Agreement so that payment of interest under each of the above-mentioned
Loans will be exempt from withholding tax under the Income Tax Assessment Act
of 1936 (Commonwealth of Australia).  Non-compliance
by either Arranger with this paragraph shall not relieve the Australian
Offshore Borrowers of their obligations under subsections 2.7C(i) or 2.7C(ii).


 


D.    Replacement
of Lender.  If any Borrower receives
a notice pursuant to subsections 2.7A, 2.7B or 2.7C, so long as no Event of
Default shall have occurred and be continuing and such Borrower has obtained a
commitment from another Lender or an Eligible Assignee to become a Lender for
all purposes under this Agreement and to assume all obligations of the Lender
to be replaced, such Borrower may require the Lender giving such notice to
assign all of its Loans, its Commitments and its other Obligations to such
other Lender or Eligible Assignee, at par, pursuant to and in accordance with
the provisions of subsection 10.2B; provided that, prior to or
concurrently with such replacement (i) the applicable Borrower has paid or
caused to be paid to the Lender giving such notice all principal, interest,
fees and other amounts due and owing to such Lender hereunder through such date
of replacement (including any amounts payable under subsection 2.6E), (ii)
the applicable Borrower has paid to Administrative Agent the processing and
recordation fee required to be paid pursuant to subsection 10.2B(i); and
(iii) all of the requirements for such assignment


 


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contained in
subsection 10.2B, including, without limitation, the receipt by
Administrative Agent of an executed Assignment and Acceptance and other
supporting documents, have been fulfilled.


 


2.8          Letters of
Credit


 


A.    Letters
of Credit.  Subject to the terms and
conditions of this Agreement and in reliance upon the representations and
warranties of Company and Borrowers set forth herein, Borrowers’ Agent may
request on behalf and for the account of any Borrower (other than Avir, United
Glass, BSN or O-I Canada; provided, however, Borrowers’ Agent may
request that a Letter of Credit be issued for the account of a Domestic
Borrower which will support an obligation of any such Borrower), in accordance
with the provisions of this subsection 2.8A, in addition to requesting
that Lenders make Loans pursuant to subsection 2.1, that on and after the Third
Restatement Date one or more Issuing Lenders issue, and one or more Issuing
Lenders will issue, subject to the terms and conditions hereof, Standby Letters
of Credit and Commercial Letters of Credit for the account of such
Borrower.  Issuances of Letters of Credit
shall be subject to the following limitations:


 


(i)            Borrowers’ Agent shall not request
that any Lender issue, and no Lender shall have any obligation hereunder to
issue, any Letter of Credit if, after giving effect to such issuance, the Total
Utilization of Revolving Loan Commitments would exceed the Revolving Loan
Commitments then in effect;


 


(ii)           Borrowers’ Agent shall not request
that any Lender issue and no Lender shall have any obligation hereunder to
issue, any Letter of Credit for the account of any Offshore Borrower if, after
giving effect to such issuance (A) the Total Utilization of Revolving Loan
Commitments would exceed the Revolving Loan Commitments then in effect; (B) (i)
the Total Utilization of UK Revolving Loan Commitments would exceed the UK
Revolving Loan Commitments then in effect; (ii) the Total Utilization of
Australian Revolving Loan Commitments would exceed the Australian Revolving
Loan Commitments then in effect; (iii) the Total Utilization of Canadian
Revolving Loan Commitments would exceed the Canadian Revolving Commitments then
in effect or (iv) the Total Utilization of Italian Revolving Loan Commitments
would exceed the Italian Revolving Loan Commitments then in effect; or (C) the
sum of the Total Utilization of UK Revolving Loan Commitments, plus the
Total Utilization of Italian Revolving Loan Commitments plus the Total
Utilization of Australian Revolving Loan Commitments plus the Total
Utilization of the Canadian Revolving Loan Commitments would exceed the
Aggregate Offshore Sublimit;


 


(iii)          In no event shall any Issuing Lender
issue (w) any Letter of Credit having an expiration date later than ten
days prior to the Revolving Loan Commitment Termination Date; (x) subject
to the foregoing clause (w), any Standby Letter of Credit having an expiration
date more than one year after its date of issuance; provided that,
subject to the foregoing clause (w) and to subsection 2.8A(iv), this
clause (x) shall not prevent any Issuing Lender from issuing a Standby
Letter of Credit having an expiration date up to two years after its date of
issuance if such Standby Letter of Credit will be used by the applicable
Borrower in connection with, or in lieu of, posting an appeal bond; provided,
further that, subject to the foregoing clause (w), this


 


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clause (x) shall not prevent any Issuing Lender from
agreeing that a Standby Letter of Credit will automatically be extended
annually for a period not to exceed one year unless such Issuing Lender gives
notice that it will not extend; provided, further that such
Issuing Lender shall deliver a written notice to Administrative Agent setting
forth the last day on which such Issuing Lender may give notice that it will
not extend (the “Notification Date”
with respect to such Standby Letter of Credit) at least ten Business Days prior
to such Notification Date; and provided, further that, unless
Requisite Lenders otherwise consent, such Issuing Lender shall give notice that
it will not extend if it has knowledge that an Event of Default has occurred
and is continuing on such Notification Date; or (y) any Commercial Letter
of Credit (1) having a tenor other than sight or (2) having an expiration date
which is more than 180 days after its date of issuance or which is less than 30
days prior to the Revolving Loan Commitment Termination Date or which is
otherwise unacceptable to such Issuing Lender in its reasonable discretion;


 


(iv)          Borrowers’ Agent shall not request that
any Issuing Lender issue, and no Lender shall have any obligation hereunder to
issue, any Standby Letter of Credit having an expiration date more than one
year after its date of issuance which will be used by a Borrower in connection
with, or in lieu of, posting an appeal bond if, after giving effect to such
issuance, the Letter of Credit Usage in respect of all such Standby Letters of
Credit would exceed $25,000,000;


 


(v)           Borrowers’ Agent shall not request
that any Issuing Lender issue, and no Lender shall have any obligation
hereunder to issue, any Standby Letter of Credit of the type described in
clause (i), (v), (vi) or (ix) of the definition thereof for the purpose of
supporting Indebtedness of Holdings, if after giving effect to such issuance,
the Letter of Credit Usage in respect of all such Standby Letters of Credit
would exceed $100,000,000; and


 


(vi)          Borrowers’ Agent shall not request
that any Issuing Lender issue, and no Lender shall have any obligation
hereunder to issue, any Letter of Credit if, after giving effect to such
issuance, the Letter of Credit Usage in respect of all Letters of Credit would
exceed $350,000,000.


 


The
issuance of any Letter of Credit in accordance with the provisions of this
subsection 2.8 shall be given effect in the calculation of the Total
Utilization of Revolving Loan Commitments and shall require the satisfaction of
each condition set forth in subsections 3.1, 3.2 and 3.3.


 


Domestic
Borrowers, ACI and Lenders agree that any Letter of Credit issued by any
Issuing Lender as a “Letter of Credit” (as defined in the Original Credit
Agreement, First Amended and Restated Credit Agreement or Second Amended and
Restated Credit Agreement, as applicable) pursuant to the Original Credit
Agreement, the First Amended and Restated Credit Agreement or the Second
Amended and Restated Credit Agreement and outstanding as of the Third
Restatement Date (each such letter of credit being referred to herein as an “Existing Letter of Credit”) shall for all purposes of this
Agreement be a Letter of Credit outstanding under this Agreement as of the Third
Restatement Date for the joint and several account of Domestic Borrowers (in
the case of any Existing Letter of Credit issued for the account of either


 


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Domestic
Borrower) or ACI (in the case of any Existing Letter of Credit issued for the
account of ACI) under and pursuant to the terms of this Agreement, and all fees
payable under subsection 2.8F with respect to such Existing Letters of
Credit shall accrue from the date such fees were last paid under the Second
Amended and Restated Credit Agreement. 
All Existing Letters of Credit as of the date hereof are described in Schedule
D annexed hereto.


 


Immediately
upon the issuance of any Letter of Credit by an Issuing Lender, each Lender
other than such Issuing Lender shall be deemed to, and hereby agrees to, have
irrevocably purchased from such Issuing Lender a participation in such Letter
of Credit and drawings thereunder in an amount equal to such Lender’s Pro Rata
Share of the maximum amount which is or at any time may become available to be
drawn thereunder.


 


B.    Notice
of Request for Issuance.  Whenever a
Borrower desires the issuance of a Letter of Credit, it shall cause Borrowers’
Agent to deliver to Administrative Agent and to the Lender which the Borrowers’
Agent has requested to issue such Letter of Credit a Notice of Request for
Issuance of Letter of Credit no later than 1:00 P.M. (New York time) at least
five Business Days, or such shorter period as may be agreed to by an Issuing
Lender in any particular instance, in advance of the proposed date of
issuance.  The Notice of Request for
Issuance of Letter of Credit shall specify (i) the Borrower for whose account
the Letter of Credit has been requested in accordance with subsection 2.8A,
(ii) the proposed date of issuance (which shall be a business day under the
laws of the jurisdiction of the Issuing Lender), (iii) the face amount of
the Letter of Credit, (iv) in the case of a Letter of Credit which the
Borrowers’ Agent requests to be denominated in a currency other than Dollars,
the currency in which the Borrowers’ Agent requests such Letter of Credit to be
issued, (v) the expiration date of the Letter of Credit, (vi) the name and
address of the beneficiary, and (vii) the Lender which the Borrowers’
Agent has requested to issue such Letter of Credit; and such Notice of Request
for Issuance of Letter of Credit shall further certify that subsection 3.2B
is satisfied on and as of the date of issuance of such Letter of Credit.  As soon as practicable after delivery of such
notice with respect to any Letter of Credit, the Issuing Lender for such Letter
of Credit shall be determined as provided in subsection 2.8C(ii).  Prior to the date of issuance, the Borrowers’
Agent shall specify a precise description of the documents and the verbatim
text of any certificate to be presented by the beneficiary which, if presented
by the beneficiary prior to the expiration date of the Letter of Credit, would
require the Issuing Lender to make payment under the Letter of Credit; provided
that the Issuing Lender, in its sole reasonable judgment, may require changes
in any such documents and certificates. 
In determining whether to pay under any Letter of Credit, the Issuing
Lender shall be responsible only to determine that the documents and
certificates required to be delivered under that Letter of Credit have been
delivered and that they comply on their face with the requirements of that
Letter of Credit.


 


C.    Determination
of Issuing Lender.


 


(i)            Borrowers’ Agent may request any
Revolving Lender to issue a Letter of Credit and, upon receipt by such Lender
of a notice from Borrowers’ Agent pursuant to subsection 2.8B requesting
the issuance of a Letter of Credit, such Lender shall promptly notify the
Borrowers’ Agent and Administrative Agent whether or not, in its sole
discretion, it has elected to issue such Letter of Credit.  If such Lender elects to issue such Letter of
Credit, such Lender shall be the Issuing Lender with respect


 


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thereto.  If
such Lender declines to issue such Letter of Credit, the Borrowers’ Agent may
request any other Revolving Lender to issue such Letter of Credit, by
delivering the notice described in subsection 2.8B to such Lender.  In the event that all Lenders shall have
declined to issue such Letter of Credit, Administrative Agent shall be
obligated to issue the Letter of Credit requested by Borrowers’ Agent and shall
be the Issuing Lender with respect to such Letter of Credit; provided that
Administrative Agent shall not be obligated to issue any Letter of Credit
denominated in a foreign currency which in the reasonable judgment of
Administrative Agent is not readily and freely available.


 


(ii)           Each Issuing Lender which elects to
issue or amend a Letter of Credit shall promptly give written notice to
Administrative Agent, and the applicable Borrower of the information required
under clauses (i)-(v) of subsection 2.8B relating to such Letter of Credit
and shall provide a copy of such Letter of Credit (as amended, if applicable)
to Administrative Agent, and the applicable Borrower.  Promptly after receipt of such notice,
Administrative Agent shall notify each Revolving Lender (other than the Issuing
Lender) of the amount of its respective participation therein, determined in
accordance with subsection 2.8A.


 


(iii)          In the event that Administrative Agent
is not the Issuing Lender in respect of a Commercial Letter of Credit, the
Issuing Lender of such Commercial Letter of Credit will deliver to
Administrative Agent, promptly on the first Business Day of each week such
Commercial Letter of Credit is outstanding, a report setting forth the daily
aggregate outstandings for the previous week under such Commercial Letter of
Credit.  Administrative Agent shall
deliver to each Lender, promptly after the end of each calendar month and upon
each payment by Administrative Agent to Lenders of the letter of credit fees
described in subsection 2.8F(1)(b), a report setting forth, for the period
from the date of the last such report, the daily aggregate amount available to
be drawn (to the extent such amounts have been reported to Administrative Agent
pursuant to the immediately preceding sentence) under each Commercial Letter of
Credit issued by each Issuing Lender.


 


D.    Payment
of Amounts Drawn Under Letters of Credit. 
In the event of any drawing under any Letter of Credit by the
beneficiary thereof, the Issuing Lender shall notify the Borrower at whose
request the Letter of Credit was issued and Administrative Agent on or before
the date which is two Business Days prior to the date on which such Issuing
Lender intends to honor such drawing (unless such Letter of Credit by its terms
requires the Issuing Lender to honor a drawing on or prior to the second
Business Day following such drawing, in which case the Issuing Lender shall
notify the Borrower at whose request the Letter of Credit was issued and
Administrative Agent as soon as reasonably practicable but in any event on or
before the date on which such Issuing Lender intends to honor such drawing),
and the Borrower at whose request the Letter of Credit was issued shall
reimburse such Issuing Lender on the date on which such drawing is honored, in
each case in an amount in either the currency in which such Letter of Credit is
denominated or in Dollars and in Same Day Funds equal to the amount of such
drawing (which amount, in the case of a reimbursement in Dollars of a drawing
under a Letter of Credit which is denominated in a currency other than Dollars,
shall be calculated by reference to the applicable Spot Rate); provided  that,
anything contained in this Agreement to the contrary notwithstanding, unless
the Borrower at whose request the Letter of Credit was issued


 


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shall have notified
Administrative Agent and such Issuing Lender prior to 11:00 a.m. (New York
time) on the Business Day immediately prior to the date of such drawing that
the Borrower at whose request the Letter of Credit was issued intends to
reimburse such Issuing Lender for the amount of such drawing with funds other
than the proceeds of Loans, the Borrower at whose request the Letter of Credit
was issued shall be deemed to have given a Notice of Borrowing to
Administrative Agent requesting Lenders to make Revolving Loans (or Offshore
Revolving Loans, as applicable) to such Borrower which are Base Rate Loans, on
the date on which such drawing is honored, in an amount in Dollars equal to the
amount of such honored drawing (which amount, in the case of a drawing under a
Letter of Credit which is denominated in a currency other than Dollars, shall
be calculated by reference to the applicable Spot Rate on the date such drawing
is honored), and subject to satisfaction or waiver of the conditions specified
in subsection 3.2B, Lenders shall, on the date of such requested
borrowing, make Revolving Loans (or Offshore Revolving Loans, as applicable) to
such Borrower which are Base Rate Loans in the amount of such drawing as
aforesaid, the proceeds of which shall be applied directly by Administrative
Agent to reimburse such Issuing Lender for the amount of such drawing, and if
for any reason proceeds of Revolving Loans (or Offshore Revolving Loans, as
applicable) are not received by such Issuing Lender on such date in an amount
equal to the amount of such drawing, Borrowers shall reimburse such Issuing
Lender in Dollars, on the business day (under the laws of the jurisdiction of
such Issuing Lender) immediately following the date on which reimbursement of
such drawing is required as provided above, in an amount in Same Day Funds
equal to the excess of the amount of such drawing over the amount of such
Revolving Loans, if any, which are so received, plus accrued interest on such
amount at the rate set forth in subsection 2.8F(2).


 


E.     Payment
by Lenders with Respect to Letters of Credit.  In the event that Borrowers shall fail to
reimburse an Issuing Lender as provided in subsection 2.8D in either the
currency in which such Letter of Credit is denominated or in an amount in
Dollars (calculated, in the case of a drawing under a Letter of Credit
denominated in a currency other than Dollars, by reference to the applicable Spot
Rate on the date such drawing is honored) equal to the amount of any drawing
honored by such Issuing Lender under a Letter of Credit issued by it, such
Issuing Lender shall promptly notify Administrative Agent of the unreimbursed
amount of such drawing and Administrative Agent shall promptly notify each
Revolving Lender of such unreimbursed amount and of such Lender’s respective
participation therein pursuant to this subsection 2.8E.  Each such Lender shall make available to such
Issuing Lender an amount equal to its respective participation, in Dollars and
in Same Day Funds, at the office of such Issuing Lender specified in such
notice, not later than 1:00 P.M. (New York time) on the business day (under the
laws of the jurisdiction of such Issuing Lender) after the date notified by
such Issuing Lender (provided, that, such Issuing Lender may
request that such purchase of participations be transacted through
Administrative Agent).  In the event that
any Revolving Lender fails to make available to such Issuing Lender the amount
of such Lender’s required participation in such Letter of Credit as provided in
this subsection 2.8E, such Issuing Lender shall be entitled to recover
such amount on demand from such Lender together with interest at the customary
rate set by such Issuing Lender for the correction of errors among banks for
three Business Days and thereafter at the Base Rate plus the Applicable Base
Rate Margin.  Nothing in this
subsection 2.8 shall be deemed to prejudice the right of any Lender to
recover from such Issuing Lender any amounts made available by such Lender to
such Issuing Lender pursuant to this subsection 2.8E in the event that it
is determined by a court of competent jurisdiction that the payment with


 


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respect to a Letter of
Credit by such Issuing Lender in respect of which payment was made by such
Lender constituted gross negligence or willful misconduct on the part of such
Issuing Lender.  Each Issuing Lender
shall distribute to each other Lender which has paid all amounts payable by it
under this subsection 2.8E with respect to any Letter of Credit issued by
such Issuing Lender such other Lender’s Pro Rata Share of all payments received
by such Issuing Lender from Borrowers in reimbursement of drawings honored by
such Issuing Lender under such Letter of Credit when such payments are
received.  Notwithstanding subsection 2.8D,
any reimbursements by Borrowers of amounts drawn on any Letter of Credit after
participations in such unreimbursed drawing have been purchased by Lenders
under this subsection 2.8E shall be made in Dollars.


 


F.     Compensation.  Borrowers agree to pay the following amounts
to each Issuing Lender for its own account with respect to Letters of Credit
issued by it (with respect to paragraphs (1)(a) and (3) below) and to
Administrative Agent for the account of each Revolving Lender (with respect to
paragraphs 1(b) and (2) below) with respect to all Letters of Credit:


 


(1)   with respect to each Letter of Credit,
(a) an administrative fee equal to 0.25% per annum of the maximum amount
available from time to time to be drawn under such Letter of Credit (but in no
event less than $250 per annum), payable in arrears on and to (but excluding)
each January 1, April 1, July 1 and October 1 of each year and calculated
on the basis of a 360-day year and the actual number of days elapsed; and (b) a
Letter of Credit Fee payable to the Lenders equal to (x) the Applicable Euro
Margin as in effect for Revolving Loans from time to time multiplied by
(y) the maximum amount available from time to time to be drawn under such
Letter of Credit, per annum payable in arrears on and to (but excluding) each
January 1, April 1, July 1 and October 1 of each year and calculated on
the basis of a 360-day year and the actual number of days elapsed which Letter
of Credit Fee shall be shared by all Revolving Lenders in accordance with their
respective Pro Rata Shares;


 


(2)   with respect to drawings made under any
Letter of Credit, interest, payable on demand, on the amount paid by such
Issuing Lender in respect of each such drawing from the date of payment of the
drawing through the date such amount is reimbursed by Borrowers (including any
such reimbursement out of the proceeds of Loans pursuant to subsection 2.8D)
at a rate equal to the sum of the Base Rate plus the Applicable Base
Rate Margin plus 2.00% per annum; and


 


(3)   with respect to the issuance, amendment or
transfer of, or payment of a drawing under, each Letter of Credit, documentary
and processing charges in accordance with such Issuing Lender’s standard
schedule for such charges in effect at the time of such issuance, amendment,
transfer or payment, as the case may be.


 


For
purposes of calculating any fees payable under clause (1) of this
subsection 2.8F, (a) the maximum amount available to be drawn under
any Letter of Credit as of any date of determination shall be determined as of
the close of business on such date and (b) any amount described in such
clauses which is denominated in a currency other than Dollars shall be valued
based on the applicable Spot Rate for such currency as of the applicable date
of determination.  Promptly upon receipt
by Administrative Agent of any amount described in


 


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clause
(1)(b) of this subsection 2.8F, Administrative Agent shall distribute to
each Revolving Lender its Pro Rata Share of such amount.  In the event Lenders have purchased
participations in a Letter of Credit pursuant to subsection 2.8E, the
Issuing Lender in respect of such Letter of Credit may request that interest
payments with respect thereto to participants be administered by and through
the Administrative Agent.


 


G.    Obligations
Absolute.  The obligation of
Borrowers to reimburse each Issuing Lender for drawings made under the Letters
of Credit issued by it and the obligations of Revolving Lenders under
subsection 2.8E shall be unconditional and irrevocable and shall be paid
strictly in accordance with the terms of this Agreement under all circumstances
including, without limitation, any of the following circumstances:


 


(1)   any lack of validity or enforceability of any
Letter of Credit;


 


(2)   the existence of any claim, set-off, defense
or other right which any Loan Party may have at any time against a beneficiary
or any transferee of any Letter of Credit (or any persons or entities for whom
any such transferee may be acting), such Issuing Lender, any Lender or any
other Person, whether in connection with this Agreement, the transactions
contemplated herein or any unrelated transaction (including any underlying
transaction between any Borrower or one of its Subsidiaries and the beneficiary
for which the Letter of Credit was procured);


 


(3)   any draft, demand, certificate or any other
document presented under any 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;


 


(4)   payment by such Issuing Lender under any
Letter of Credit against presentation of a demand, draft or certificate or
other document which does not substantially comply with the terms of such
Letter of Credit, provided that such payment does not constitute gross
negligence or willful misconduct of such Issuing Lender as determined by a
court of competent jurisdiction;


 


(5)   any other circumstance or happening
whatsoever, which is similar to any of the foregoing; or


 


(6)   the fact that an Event of Default or a
Potential Event of Default shall have occurred and be continuing.


 


H.    Additional
Payments.  If by reason of
(a) any change after the date hereof in applicable law, regulation, rule,
decree or regulatory requirement or any change after the date hereof in the
interpretation or application by any judicial or regulatory authority of any
law, regulation, rule, decree or regulatory requirement (in each case other
than any law, regulation, rule, decree or regulatory requirement regarding
capital adequacy) or (b) compliance by any Issuing Lender or any Lender
with any direction, request or requirement (whether or not having the force of
law) of any governmental or monetary authority imposed after the date hereof
including, without limitation, Regulation D (but excluding, however, any
direction, request or requirement regarding capital adequacy):


 


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(i)            such Issuing Lender or any Lender
shall be subject to any tax, levy, charge or withholding of any nature or to
any variation thereof or to any penalty with respect to the maintenance or
fulfillment of its obligations under this subsection 2.8, whether directly
or by such being imposed on or suffered by such Issuing Lender or any Lender;


 


(ii)           any reserve, deposit or similar
requirement is or shall be applicable, imposed or modified in respect of any
Letters of Credit issued by such Issuing Lender or participations therein
purchased by any Lender; or


 


(iii)          there shall be imposed on such Issuing
Lender or any Lender any other condition regarding this subsection 2.8,
any Letter of Credit or any participation therein;


 


and the result of the foregoing is to directly or
indirectly increase the cost to such Issuing Lender or any Lender of issuing,
making or maintaining any Letter of Credit or of purchasing or maintaining any
participation therein, or to reduce the amount receivable in respect thereof by
such Issuing Lender or any Lender, then and in any such case such Issuing
Lender or such Lender may, at any time within six months after the additional
cost is incurred or the amount received is reduced, notify Borrowers, and
Borrowers shall pay within ten days of receipt of such notice such amounts as
such Issuing Lender or such Lender may specify to be necessary to compensate
such Issuing Lender or such Lender for such additional cost or reduced receipt,
together with interest on such amount from 10 days after the date of such
demand until payment in full thereof at a rate equal at all times to the Base
Rate per annum.  The determination by
such Issuing Lender or any Lender, as the case may be, of any amount due
pursuant to this subsection 2.8H as set forth in a certificate setting
forth the calculation thereof in reasonable detail, shall, in the absence of
manifest or demonstrable error, be final and conclusive and binding on all of
the parties hereto.


 


I.      Indemnification;
Nature of Issuing Lender’s Duties. 
In addition to amounts payable as elsewhere provided in this
subsection 2.8, (i) Domestic Borrowers hereby agree to protect, indemnify,
pay and save each Issuing Lender harmless from and against any and all claims,
demands, liabilities, damages, losses, costs, charges and expenses (including
reasonable attorneys’ fees and allocated costs of internal counsel) which such
Issuing Lender may incur or be subject to as a consequence, direct or indirect,
of (A) the issuance of the Letters of Credit for the account of any
Domestic Borrower, other than as a result of the gross negligence or willful
misconduct of such Issuing Lender as determined by a court of competent
jurisdiction or (B) the failure of such Issuing Lender to honor a drawing
under any Letter of Credit for the account of any Domestic Borrower as a result
of any act or omission, whether rightful or wrongful, of any present or future
de jure or de facto government or governmental authority (all such acts or
omissions herein called “Government Acts”); and (ii) the Offshore Borrowers
hereby agree to protect, indemnify, pay and save each Issuing Lender harmless
from and against any and all claims, demands, liabilities, damages, losses,
costs, charges and expenses (including reasonable attorneys’ fees and allocated
costs of internal counsel) which such Issuing Lender may incur or be subject to
as a consequence, direct or indirect, of (A) the issuance of any Letter of
Credit for the account of any Offshore Borrower, other than as a result of the
gross negligence or willful misconduct of such Issuing Lender as determined by
a court of competent jurisdiction or (B) the


 


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failure of such Issuing
Lender to honor a drawing under any Letter of Credit for the account of any
Offshore Borrower as a result of Government Acts.


 


Subject
to the preceding paragraph, as between each relevant Borrower and each Issuing
Lender, such Borrower assumes all risks of the acts and omissions of, or misuse
of the Letters of Credit issued by such Issuing Lender on account of that
Borrower by, the respective beneficiaries of such Letters of Credit.  In furtherance and not in limitation of the
foregoing, such Issuing Lender shall not be responsible: (i) for the form,
validity, sufficiency, accuracy, genuineness or legal effect of any document
submitted by any party in connection with the application for and issuance of
such Letters of Credit, even if it should in fact prove to be in any or all
respects invalid, insufficient, inaccurate, fraudulent or forged; (ii) for
the validity or sufficiency of any instrument transferring or assigning or
purporting to transfer or assign any such 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; (iii) for failure of the
beneficiary of any such Letter of Credit to comply fully with conditions
required in order to draw upon such Letter of Credit; (iv) for errors,
omissions, interruptions or delays in transmission or delivery of any messages,
by mail, cable, telegraph, telex, electronic mail or otherwise; (v) for
errors in interpretation of technical terms; (vi) for any loss or delay in
the transmission or otherwise of any document required in order to make a drawing
under any such Letter of Credit or of the proceeds thereof; (vii) for the
misapplication by the beneficiary of any such Letter of Credit of the proceeds
of any drawing under such Letter of Credit; and (viii) for any
consequences arising from causes beyond the control of such Issuing Lender,
including, without limitation, any Government Acts.  None of the above shall affect, impair, or
prevent the vesting of any of such Issuing Lender’s rights or powers hereunder;
provided, however, that such Issuing Lender shall be responsible
for any payment it makes under any Letter of Credit against presentation of a
demand, draft or certificate or other document which does not substantially
comply with the terms of such Letter of Credit in the event such payment constitutes
gross negligence or willful misconduct of such Issuing Lender as determined by
a court of competent jurisdiction.


 


In
furtherance and extension and not in limitation of the specific provisions
hereinabove set forth, any action taken or omitted by any Issuing Lender under
or in connection with the Letters of Credit issued by it or the related
certificates, if taken or omitted in good faith and in the absence of gross
negligence or willful misconduct, shall not put such Issuing Lender under any
resulting liability to Borrowers.


 


Notwithstanding
anything to the contrary contained in this subsection 2.8I, Borrowers
shall have no obligation to indemnify any Issuing Lender in respect of any
liability incurred by such Issuing Lender arising solely out of the gross
negligence or willful misconduct of such Issuing Lender, as determined by a
court of competent jurisdiction, or out of the wrongful dishonor by such
Issuing Lender of proper demand for payment made under the Letters of Credit
issued by it.


 


J.     Computation
of Interest.  Interest payable
pursuant to this subsection 2.8 shall be computed on the basis of a
360-day year and the actual number of days elapsed in the period during which
it accrues.


 


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2.9          Joint and Several Liability;
Contribution; O-I General as Borrowers’ Agent


 


A.    Joint
and Several Liability; Cross Guaranty – Domestic Borrowers.  The liabilities relating to the Revolving
Loans and the Revolving Loan Commitments shall be the joint and several
Obligations of each Domestic Borrower. 
The liability of Owens-Brockway with respect to the Tranche B1 Term Loans
shall be guaranteed by O-I Plastic under the Domestic Borrowers’ Guaranty.  The Obligations of and the Liens granted by any
such Domestic Borrower under the Loan Documents shall not be impaired or
released by any action or inaction on the part of any Agent or any Lender with
respect to any other Domestic Borrower, including any action or inaction which
would otherwise release a surety.  The Obligations
of a Domestic Borrower in respect of the Revolving Loans made to the other
Domestic Borrower and the Revolving Loan Commitments to the other Domestic
Borrower shall be limited in amount to an amount not to exceed the maximum
amount of obligations, as it relates to such Domestic Borrower, void or
voidable under applicable laws relating to fraudulent conveyance, fraudulent
transfer or other similar laws affecting the rights of creditors generally.


 


B.    Contribution
– Domestic Borrowers.  In order to
provide for just and equitable contribution among the Domestic Borrowers if any
payment is made by a Domestic Borrower (a “Domestic Funding Borrower”)
in discharging any of the Obligations of the other Domestic Borrower, that
Domestic Funding Borrower shall be entitled to a contribution from the other
Domestic Borrower for all payments, damages and expenses incurred by that
Domestic Funding Borrower in discharging the Obligations, in the manner and to
the extent required to allocate liabilities in an equitable manner among Domestic
Borrowers by the relative benefits received by Domestic Borrowers.  If and to the extent that a Domestic Funding
Borrower makes any payment to any Lender or any other Person in respect of the
Obligations, any claim which said Funding Borrower may have against the other
Domestic Borrower by reason thereof shall be subject and subordinate to the
prior Cash payment in full to the Lenders of the Obligations.  The parties hereto acknowledge that the right
to contribution hereunder shall constitute an asset of the party to which such
contribution is owing.  Notwithstanding
any of the foregoing to the contrary, such contribution arrangements shall not
limit in any manner the joint and several nature of the Obligations of the Domestic
Borrowers in respect of the Revolving Loans and the Revolving Loan Commitments,
limit, release or otherwise impair any rights of any Agent or any Lender under
the Loan Documents, or alter, limit or impair the obligation of each Domestic
Borrower, which is absolute and unconditional, to repay its Obligations.


 


C.    Joint
and Several Liability – Australian Offshore Borrowers.  All liabilities and obligations in respect of
and relating to the Australian Revolving Loans shall be the joint and several
Obligations of each Australian Offshore Borrower.  The liability of ACI with respect to the
Tranche A1 Term Loan shall be guaranteed by O-I Australia under an Offshore
Guaranty.


 


D.    Contribution
– Australian Offshore Borrowers.  In
order to provide for just and equitable contribution among the Australian
Offshore Borrowers in Australia if any payment is made by an Australian
Offshore Borrower from Australia (an “Offshore
Funding Australian Borrower”) in discharging any of the Obligations
of another Australian Offshore Borrower, that Offshore Funding Australian
Borrower shall be entitled to a contribution from the such Australian Offshore
Borrower for all payments, damages and expenses incurred by that Offshore


 


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Funding Australian
Borrower in discharging Obligations on behalf of such other Australian Offshore
Borrower, in the manner and to the extent required to allocate liabilities in
an equitable manner among the Australian Offshore Borrowers by the relative
benefits received by such Australian Offshore Borrowers.  If and to the extent that an Offshore Funding
Australian Borrower makes any payment to any Lender or any other Person in
respect of the Obligations, any claim which said Offshore Funding Australian
Borrower may have against the other Australian Offshore Borrower by reason
thereof shall be subject and subordinate to the prior Cash payment in full of
the Obligations.  The parties hereto
acknowledge that the right to contribution hereunder shall constitute an asset of
the party to which such contribution is owing. 
Notwithstanding any of the foregoing to the contrary, such contribution
arrangements shall not limit in any manner the joint and several nature of the
Obligations of the Australian Offshore Borrowers as described in clause C,
above, limit, release or otherwise impair any rights of any Agent or any Lender
under the Loan Documents, or alter, limit or impair the obligation of each
Australian Offshore Borrower, which is absolute and unconditional, to repay its
Obligations.


 


E.     O-I
General as Borrowers’ Agent.  O-I
General is hereby appointed Borrowers’ agent hereunder by each Borrower (in
such capacity “Borrowers’ Agent”).  Each Borrower hereby authorizes, directs and
empowers O-I General to act for and in the name of such Borrower and as its
agent hereunder and under the other instruments and agreements referred to
herein.  O-I General hereby accepts each
such appointment.  Each Borrower hereby
irrevocably authorizes O-I General to take such action on such Borrower’s
behalf and to exercise such powers hereunder, under the other Loan Documents,
and under the other agreements and instruments referred to herein or therein as
may be contemplated being taken or exercised by such Borrower by the terms
hereof and thereof, together with such powers as may be incidental thereto,
including, without limitation, to borrow hereunder and deliver Notices of
Borrowing, Notices of Conversion/Continuation, Notices of Issuance of Letter of
Credit and Compliance Certificates hereunder, to convert, continue, repay or
prepay Loans made hereunder, to reduce the Commitments, to pay interest, fees,
costs and expenses incurred in connection with the Loans, this Agreement, the
other Loan Documents, and the other agreements and instruments referred to
herein or therein, to receive from or deliver to any Agent any notices,
statements, reports, certificates or other documents or instruments
contemplated herein, in the other Loan Documents or in any other agreement or
instrument referred to herein and to receive from or transmit to any Agent any
Loan proceeds or payments.  Each Agent
and each Lender shall be entitled to rely on the appointment and authorization
of O-I General with respect to all matters related to this Agreement, the other
Loan Documents and any other agreements or instruments referred to herein or
therein whether or not any particular provision hereof or thereof specifies
that such matters may or shall be undertaken by Borrowers’ Agent.  In reliance hereon, each Agent and each Lender
may deal with O-I General alone with the same effect as if such Agent or
such Lender had dealt with each Borrower separately and individually.


 


2.10        Collection
Allocation Mechanism


 


A.    Implementation
of Collection Allocation Mechanism. 
On the CAM Exchange Date, (i) the Commitments shall terminate as
provided in Section 7, (ii) all Loans denominated in an Offshore Currency shall
be converted into, and all such amounts due thereunder shall accrue and be
payable in, Dollars at the applicable Spot Rate on such date, and on and after
such date the interest rate applicable to all such Loans shall be the rate
applicable to overdue Loans of the


 


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relevant type that are
Base Rate Loans hereunder, (iii) Revolving Lenders shall purchase their
required participations in the Domestic Overdraft Amount and the Offshore
Overdraft Amount pursuant to subsection 2.1B and 2.1D(ii), respectively, (iv)
the Lenders shall automatically and without further action (and without regard
to the provisions of subsection 10.2) be deemed to have exchanged
interests in the Loans constituting Specified Obligations (and as more particularly
described in clauses (v) and (vi) of this subclause (A), in Domestic Overdraft
Amounts, Offshore Overdraft Amounts and Letters of Credit, respectively) such
that in lieu of the interest of each Lender in each such Loan (and such other
Obligations) in which it shall participate as of such date (including such
Lender’s interest in the Specified Obligations of each Loan Party in respect of
each such Loan and other Obligations), such Lender shall hold an interest in
every one of the Loans constituting Specified Obligations, the Domestic
Overdraft Amounts, the Offshore Overdraft Amounts and the Letters of Credit
(including the Specified Obligations of each Loan Party in respect of each such
Loans, the Domestic Overdraft Amounts, the Offshore Overdraft Amounts, and the
Letters of Credit), whether or not such Lender shall previously have
participated therein, equal to such Lender’s CAM Percentage thereof, (v) the
Lenders shall automatically and without further action (and without regard to
the provisions of subsection 10.2 be deemed to have exchanged interests in
the Domestic Overdraft Amount and in participations in amounts due with respect
to the Domestic Overdraft Amount previously purchased pursuant to
subsection 2.1B, such that in lieu of the interest of each Lender in each
Domestic Overdraft Amount in which it shall participate as of such date
(including such Lender’s interest in the Specified Obligations of each Loan
Party in respect of each such Domestic Overdraft Amount), such Lender shall
hold an interest in every one of the Domestic Overdraft Amounts (including the
Specified Obligations of each Loan Party in respect of each such Domestic
Overdraft Amount), whether or not such Lender shall previously have
participated therein, equal to such Lender’s CAM Percentage thereof, (vi) all
Offshore Overdraft Amounts denominated in an Offshore Currency shall be
converted into, and all such amounts due thereunder shall accrue and be payable
in, Dollars at the applicable Spot Rates on such date, and on and after such
date the interest rate applicable to all such Offshore Overdraft Amounts shall
be the rate applicable to overdue Offshore Revolving Loans that are Base Rate
Loans hereunder, and the Lenders shall automatically and without further action
(and without regard to the provisions of subsection 10.2) be deemed to
have exchanged interests in the converted Offshore Overdraft Amount and in
participations in amounts due with respect to the converted Offshore Overdraft
Amount previously purchased pursuant to subsection 2.1D, such that in lieu
of the interest of each Lender in each Offshore Overdraft Amount in which it
shall participate as of such date (including such Lender’s interest in the
Specified Obligations of each Loan Party in respect of each such Offshore
Overdraft Amount), such Lender shall hold an interest in every one of the
Offshore Overdraft Amounts (including the Specified Obligations of each Loan
Party in respect of each such Offshore Overdraft Amount), whether or not such
Lender shall previously have participated therein, equal to such Lender’s CAM
Percentage thereof.


 


B.    Binding
Nature of Collection Allocation Mechanism. 
Each Lender hereby consents and agrees (and each Borrower hereby
consents) to the CAM Exchange, and each Lender agrees that the CAM Exchange
shall be binding upon its successors and assigns and any Person that acquires a
participation in its interests in any Loan constituting Specified
Obligations.  Each Borrower agrees from
time to time to execute and deliver to the Administrative Agent all
participation certificates and other instruments and documents as the
Administrative Agent shall reasonably request to evidence and confirm the
respective interests of 


 


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the Lenders after giving
effect to the CAM Exchange, and each Lender agrees to surrender any promissory
notes originally received by it in connection with its Loans constituting
Specified Obligations hereunder to the Administrative Agent against delivery of
new promissory notes evidencing its interests in the Specified Obligations with
respect to the Loans; provided that the failure of any Borrower to execute or
deliver or of any Lender to accept any such promissory note, instrument or
document shall not affect the validity or effectiveness of the CAM Exchange.


 


C.    Payments
Subsequent to CAM Exchange Date.  As
a result of the CAM Exchange, upon and after the CAM Exchange Date, each
payment received by the Administrative Agent or Collateral Agent pursuant to
any Loan Document in respect of the Specified Obligations, and each
distribution made by the Collateral Agent pursuant to any Collateral Documents
in respect of the Specified Obligations, shall be distributed to the Lenders
pro rata in accordance with their respective CAM Percentages.  Any direct payment received by a Lender upon
or after the CAM Exchange Date, including by way of set-off, in respect of a
Specified Obligation shall be paid over to the Administrative Agent for
distribution to the Lenders in accordance herewith.


 


D.    Letters
of Credit.


 


(i)            In the event that on the CAM
Exchange Date any Letter of Credit shall be outstanding and undrawn in whole or
in part, or any amount drawn under a Letter of Credit shall not have been
reimbursed by the applicable Borrower or with the proceeds of a Revolving Loan,
each Revolving Lender shall promptly pay over to the Administrative Agent, in
immediately available funds, an amount in Dollars equal to such Lender’s Pro
Rata Share of such Letter of Credit’s undrawn face amount or (to the extent it
has not already done so) such Letter of Credit’s unreimbursed drawing (in each
case, based on the Dollar Equivalent thereof, in the case of any Letters of
Credit issued in a currency other than Dollars), together with interest thereon
from the CAM Exchange Date to the date on which such amount shall be paid to
the Administrative Agent at the rate that would be applicable at the time to a
Base Rate Revolving Loan in a principal amount equal to such amount, as the
case may be.  The Administrative Agent
shall establish a separate account or accounts for each Lender (each, an “LC Reserve Account”) for the amounts received with respect
to each such Letter of Credit pursuant to the preceding sentence.  The Administrative Agent shall deposit in
each Lender’s L/C Reserve Account such Lender’s CAM Percentage of the amounts
received from the Revolving Lenders as provided above. The Administrative Agent
shall have sole dominion and control over each LC Reserve Account, and the
amounts deposited in each LC Reserve Account shall be held in such LC Reserve
Account until withdrawn as provided in clauses (ii), (iii), (iv) and (v)
below.  The Administrative Agent shall
maintain records enabling it to determine the amounts paid over to it and
deposited in the LC Reserve Accounts in respect of each Letter of Credit and
the amounts on deposit in respect of each Letter of Credit attributable to each
Lender’s CAM Percentage.  The amounts
held in each Lender’s LC Reserve Account shall be held as a reserve against the
Letter of Credit Usage, shall be the property of such Lender, shall not
constitute Loans to or give rise to any claim of or against any Loan Party and
shall not give rise to any obligation on the part of any Borrower to pay
interest to such Lender, it being agreed that the reimbursement obligations in
respect of Letters of Credit shall arise only at such times as drawings are
made thereunder, as provided in subsection 2.8.


 


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(ii)           In the event that after the CAM
Exchange Date any drawing shall be made in respect of a Letter of Credit, or,
if on the CAM Exchange Date, any amount drawn on a Letter of Credit shall not
have been reimbursed by the applicable Borrower or with the proceeds of a
Revolving Loan, the Administrative Agent shall, at the request of the
applicable Issuing Lender, withdraw from the LC Reserve Account of each Lender
any amounts, up to the amount of such Lender’s CAM Percentage of such drawing,
deposited in respect of such Letter of Credit and remaining on deposit and
deliver such amounts to such Issuing Lender in satisfaction of the
reimbursement obligations of the Revolving Lenders under subsections 2.8D and 2.8E
(but not of the applicable Borrower under subsection 2.8D).  In the event any Revolving Lender shall
default on its obligation to pay over any amount to the Administrative Agent in
respect of any Letter of Credit as provided in this subsection 2.10D, the
applicable Issuing Bank shall, in the event of a drawing thereunder, have a
claim against such Revolving Lender to the same extent as if such Lender had
defaulted on its obligations under subsections 2.8D and 2.8E; but shall have no
claim against any other Lender in respect of such defaulted amount,
notwithstanding the exchange of interests in the reimbursement obligations pursuant
to subsection 2.10.  Each other
Lender shall have a claim against such defaulting Revolving Lender for any
damages sustained by it as a result of such default, including, in the event
such Letter of Credit shall expire undrawn, its CAM Percentage of the defaulted
amount.


 


(iii)          In the event that after the CAM
Exchange Date any Letter of Credit shall expire undrawn, the Administrative
Agent shall withdraw from the LC Reserve Account of each Lender the amount
remaining on deposit therein in respect of such Letter of Credit and distribute
such amount to such Lender.


 


(iv)          With the prior written approval of the
Administrative Agent and each Issuing Lender with an outstanding Letter of
Credit, any Lender may withdraw the amount held in its LC Reserve Account in
respect of the undrawn amount of any Letter of Credit.  Any Lender making such a withdrawal shall be
unconditionally obligated, in the event there shall subsequently be a drawing
under such Letter of Credit, to pay over to the Administrative Agent in Dollars,
for the account of the applicable Issuing Lender on demand, its CAM Percentage
of such drawing.


 


(v)           Pending the withdrawal by any Lender
of any amounts from its LC Reserve Account as contemplated by the above
paragraphs, the Administrative Agent will, at the direction of such Lender and
subject to such rules as the Administrative Agent may prescribe for the
avoidance of inconvenience, invest such amounts in Cash Equivalents.  Each Lender that has not withdrawn its
amounts in its LC Reserve Account as provided in paragraph (d) above shall have
the right, at intervals reasonably specified by the Administrative Agent, to
withdraw the earnings on investments so made by the Administrative Agent with
amounts in its LC Reserve Account and to retain such earnings for its own
account.


 


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SECTION 3


 


CONDITIONS TO THIRD RESTATEMENT
DATE; LOANS AND LETTERS OF CREDIT


 


The
obligations of Lenders to consummate the amendment and restatement of the Second
Amended and Restated Credit Agreement on the Third Restatement Date and to make
Loans and to issue Letters of Credit hereunder, is subject to the satisfaction
of the following conditions.


 


3.1          Conditions to Third Restatement Date.


 


The
effectiveness of this Agreement is subject to the satisfaction of the
conditions set forth in Section 7 of the First Amendment.


3.2          Conditions
to All Loans.


 


The
obligations of Lenders to make Loans on each Funding Date are subject to the
following further conditions precedent:


A.    Administrative
Agent shall have received on or before that Funding Date, in accordance with
the provisions of subsection 2.1E, an originally executed Notice of
Borrowing, in each case signed by a duly authorized Officer of the applicable
Borrower.


B.    As
of that Funding Date:


 


(i)            The representations and warranties
contained herein and in the other Loan Documents shall be true, correct and
complete in all material respects on and as of that Funding Date to the same
extent as though made on and as of that date, except to the extent such
representations and warranties specifically relate to an earlier date, in which
case such representations and warranties shall have been true, correct and
complete in all material respects on and as of such earlier date;


 


(ii)           No event shall have occurred and be
continuing or would result from the consummation of the borrowing contemplated
by such Notice of Borrowing that would constitute an Event of Default or a
Potential Event of Default;


 


(iii)          Each Loan Party shall have performed
in all material respects all agreements and satisfied all conditions which this
Agreement provides shall be performed or satisfied by it on or before that
Funding Date;


 


(iv)          No order, judgment or decree of any
arbitrator or Government Authority shall purport to enjoin or restrain any
Lender from making the Loans to be made by it on that Funding Date; and


 


(v)           The making of the Loans requested on
such Funding Date shall not violate Regulation U of the Board of Governors of
the Federal Reserve System.


 


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3.3          Conditions
to Letters of Credit


 


The
issuance of any Letter of Credit (other than Existing Letters of Credit)
hereunder (whether or not the applicable Issuing Lender is obligated to issue
such Letter of Credit) is subject to the following conditions precedent:


 


A.    On
or before the date of issuance of the initial Letter of Credit pursuant to this
Agreement, the initial Loans shall have been made.


 


B.    On
or before the date of issuance of such Letter of Credit, Administrative Agent
shall have received, in accordance with the provisions of subsection 2.8B,
an originally executed Notice of Request for Issuance of Letter of Credit (or a
facsimile copy thereof) in each case signed by a duly authorized officer of the
Borrower requesting the Letter of Credit, together with all other information
specified in subsection 2.8B and such other documents or information as
the applicable Issuing Lender may reasonably require in connection with the
issuance of such Letter of Credit.


 


C.    On
the date of issuance of such Letter of Credit, all conditions precedent
described in subsection 3.1 and subsection 3.2 shall be satisfied to
the same extent as if the issuance of such Letter of Credit were the making of
a Loan and the date of issuance of such Letter of Credit were a Funding Date.


 


SECTION 4


 


LOAN PARTIES’ REPRESENTATIONS AND WARRANTIES


 


In
order to induce Lenders to enter into this Agreement and to amend and restate
the Second Amended and Restated Credit Agreement as provided hereunder, to
induce the Lenders to thereafter make Revolving Loans and Offshore Revolving
Loans hereunder, to induce Administrative Agent to make overdrafts in respect
of the Domestic Overdraft Account, to induce Offshore Overdraft Account
Providers to make overdrafts in respect of the Offshore Overdraft Accounts, to
induce Issuing Lenders to issue Letters of Credit and to induce Lenders to
purchase participations in Letters of Credit, in the Domestic Overdraft Amount
and in the Offshore Overdraft Amounts, Company and each Borrower represents and
warrants to each Lender, on the Third Restatement Date, and on each other
Funding Date, on the date of issuance of each Letter of Credit and on the date
of execution by any Loan Party of a Loan Document pursuant to subsection 10.22,
that the following statements are true, correct and complete, which
representations and warranties in the case of each Offshore Borrower shall be
limited to such Offshore Borrower and its Subsidiaries:


 


4.1          Organization,
Powers, Good Standing, Business and Subsidiaries


 


A.    Organization
and Powers.  Each of the Loan Parties
is a company, duly organized, validly existing and, where applicable,  in good standing under the laws of its
jurisdiction of formation.  Each of the
Loan Parties has all requisite organizational power and authority to own and
operate its properties, to carry on its business as now conducted and proposed
to be conducted, to enter into each Loan Document to which it is a party and to
carry


 


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out the transactions
contemplated hereby and thereby, and, in the case of Borrowers, to issue the
Notes.


 


B.    Good
Standing.  Each of the Loan Parties
is in good standing wherever necessary to carry on its present business and
operations, except in jurisdictions in which the failure to be in good standing
has not had and will not have a Material Adverse Effect.


 


C.    Conduct
of Business.  Company and its
Subsidiaries are engaged only in the businesses permitted to be engaged in
under subsection 6.11.


 


D.    Subsidiaries.  All of the Subsidiaries of Company and their
jurisdictions of organization are identified in Schedule 4.1
annexed hereto, as said Schedule 4.1 may be supplemented from time to
time pursuant to the provisions of subsection 5.1(xi).  The Capital Stock of each of the Subsidiaries
of Company identified in Schedule 4.1 annexed hereto (as so
supplemented), is duly authorized, validly issued, fully paid and nonassessable
and as of the Third Restatement Date none of such Capital Stock constitutes
Margin Stock.  Each of the Subsidiaries
of Company identified in Schedule 4.1 annexed hereto (as so
supplemented) is a company duly organized, validly existing and in good
standing where applicable under the laws of its respective jurisdiction of
organization set forth therein, has all requisite power and authority to own
and operate its properties and to carry on its business as now conducted and as
proposed to be conducted, and is qualified to do business and in good standing where
applicable in every jurisdiction where its assets are located and wherever
necessary to carry out its business and operations, in each case except where
failure to be so qualified or in good standing or a lack of such power and
authority has not had and could not reasonably be expected to result in a
Material Adverse Effect.  Schedule 4.1
annexed hereto (as so supplemented) correctly sets forth, as of the Third
Restatement Date, the ownership interest of Company and each of its
Subsidiaries in each of the Subsidiaries of Company identified therein.


 


4.2          Authorization
of Borrowing, Etc.


 


A.    Authorization
of Borrowing.  The execution,
delivery and performance of the Loan Documents and the issuance, delivery and
payment of the Notes have been duly authorized by all necessary organizational
action by each Loan Party which is a party thereto.


 


B.    No
Conflict.  The execution, delivery
and performance by each Loan Party of the Loan Documents to which it is a party
and the issuance, delivery and performance of the Notes do not and will not
(i) violate any provision of law applicable to such Loan Party, the
Organizational Documents of such Loan Party, or any order, judgment or decree
of any court or other agency of government binding on such Loan Party,
(ii) conflict with, result in a material breach of or constitute (with due
notice or lapse of time or both) a material default under any Contractual
Obligation of Company or any of its Subsidiaries, (iii) result in or
require the creation or imposition of any Lien (other than Liens in favor of
the Collateral Agent) upon any of the properties or assets of Company or any of
its Subsidiaries, or (iv) require any approval of stockholders or any
approval or consent of any Person under any Contractual Obligation of Company
or any of its Subsidiaries, other than those approvals and consents which have
been obtained.


 


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C.    Governmental
Consents.  The execution, delivery
and performance by each Loan Party of the Loan Documents to which it is a party
and the issuance, delivery and performance of the Notes did not, do not and
will not require any registration with, consent or approval of, or notice to,
or other action to, with or by, any federal, state or other governmental
authority or regulatory body except for filings, consents or notices that have
been or will be made during the period in which they are required to be made.


 


D.    Binding
Obligations.  This Agreement and the
other Loan Documents executed prior to the date of this Agreement are, and the
other Loan Documents and the Notes to be executed subsequent to the date of
this Agreement, when executed and delivered will be, the legally valid and
binding obligations of the applicable Loan Parties, enforceable against the
applicable Loan Parties in accordance with their respective terms, except as
enforcement may be limited by bankruptcy, insolvency, reorganization,
moratorium or similar laws relating to or limiting creditors’ rights generally
or by equitable principles relating to enforceability.


 


4.3          Financial
Condition


 


Borrowers
have heretofore delivered to Lenders, at Lenders’ request, the audited
consolidated balance sheet of Holdings and its Subsidiaries as at December 31,
2003  and the related consolidated
statements of income, stockholders’ equity and cash flows of Holdings and its
Subsidiaries for the Fiscal Year then ended and the unaudited consolidated
balance sheet of Holdings and its Subsidiaries and the unaudited consolidated
balance sheet of Company and its Subsidiaries as of June 30, 2004 and the
related unaudited consolidated statements of income and cash flows of Company
and its Subsidiaries for the periods then ended.  All such statements were prepared in
conformity with GAAP.  All such
consolidated financial statements fairly present the consolidated financial
position of Holdings and its Subsidiaries as at the date thereof and the
consolidated results of operations and cash flows of Holdings and its
Subsidiaries for the period covered thereby. 
Neither Company nor any of its Subsidiaries has any material contingent
liability or material liability for taxes, long-term lease or unusual forward
or long-term commitment, which is not reflected in the foregoing financial
statements or in the most recent consolidated financial statements delivered
pursuant to Section 5.1 of this Agreement, except for those incurred since the
date of such financial statements that are not prohibited hereunder.


 


4.4          No
Adverse Material Change; No Restricted Junior Payment


 


Since
December 31, 2003, except as publicly disclosed in filings by Holdings or
any Borrower with the Securities and Exchange Commission prior to the date
hereof,  there has been no change in the
business, operations, properties, assets or condition (financial or otherwise)
of Company and its Subsidiaries, which has been, either in any case or in the
aggregate, materially adverse to Company and its Subsidiaries, taken as a
whole.  Since the Second Restatement Date,
neither Company nor any of its Subsidiaries has directly or indirectly
declared, ordered, paid or made or set apart any sum or property for any
Restricted Junior Payment or agreed so to do except as permitted by subsection
6.5.


 


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4.5          Litigation;
Adverse Facts


 


Except
as disclosed in Holdings’ annual report on Form 10-K for the Fiscal Year ended
December 31, 2003, there is no action, suit, proceeding, governmental
investigation or arbitration of which Company has knowledge (whether or not
purportedly on behalf of Company or any of its Subsidiaries) at law or in
equity or before or by any federal, state, municipal or other governmental
department, commission, board, bureau, agency or instrumentality, domestic or
foreign, pending or, to the knowledge of Company, threatened against or
affecting Company or any of its Subsidiaries or any property of Company or any
of its Subsidiaries which would reasonably be expected to result in a Material
Adverse Effect.


 


4.6          Payment of
Taxes


 


Except
to the extent permitted by subsection 5.3, all material tax returns and
reports of Holdings and each of its Subsidiaries required to be filed by any of
them have been timely filed, and all material taxes, assessments, fees and
other governmental charges upon such Persons and upon their respective properties,
assets, income and franchises which are due and payable have been paid when due
and payable.


 


4.7          Governmental
Regulation


 


Neither
Holdings nor any of its Subsidiaries is subject to regulation under the Public
Utility Holding Company Act of 1935 or the Investment Company Act of 1940 or to
any federal or state statute or regulation limiting its ability to incur
Indebtedness for money borrowed.


 


4.8          Securities
Activities


 


A.    Neither
Holdings nor any of its Subsidiaries is engaged principally, or as one of its
important activities, in the business of extending credit for the purpose of
purchasing or carrying any Margin Stock.


 


B.    Following
application of the proceeds of each Loan, not more than 25% of the value of the
assets (either of Company only or of Company and its Subsidiaries on a
consolidated basis) subject to the provisions of subsection 6.2 or 6.7, or
subject to any similar restriction contained in any agreement or instrument
between Company and any Lender or any Affiliate of any Lender relating to
Indebtedness and within the scope of subsection 7.2, was or will be
attributable to Margin Stock.


 


4.9          Employee
Benefit Plans


 


A.    Each
of Holdings and each of its Subsidiaries is in compliance with all applicable
provisions of ERISA, the Internal Revenue Code and other applicable federal,
state or foreign law with respect to each Plan, and has performed all of its
obligations under each Plan, except to the extent that failure to comply,
individually or in


 


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the aggregate, would not
reasonably be expected to have a Material Adverse Effect.  Holdings, each of its Subsidiaries and each
ERISA Affiliate has made all required contributions to any Plan subject to
Section 412 of the Internal Revenue Code, except to the extent that a
failure to do so would not, individually or in the aggregate, reasonably be
expected to have a Material Adverse Effect, and no application for a funding
waiver or an extension of any amortization period pursuant to Section 412
of the Internal Revenue Code has been made with respect to any Plan.


 


B.    (i)
No ERISA Event has occurred or is reasonably expected to occur; (ii) no
Pension Plan which is reasonably likely to be terminated has any Unfunded
Pension Liability in an amount which, individually or in the aggregate for all
such Pension Plans (excluding for purposes of such computation any such Pension
Plans with respect to which assets exceed benefit liabilities), would
reasonably be expected to have a Material Adverse Effect if such Pension Plan
or Pension Plans were then terminated; and (iii) none of Holdings, any of its
Subsidiaries or any ERISA Affiliate has engaged in a transaction that could be
subject to Section 4069 or 4212(c) of ERISA that, individually or in the
aggregate, would reasonably be expected to have a Material Adverse Effect.


 


4.10        Disclosure


 


No
representation or warranty of any Loan Party contained in this Agreement, any
Loan Document or any other document, certificate or written statement furnished
to Lenders by or on behalf of any Loan Party for use in connection with the
transactions contemplated by this Agreement contains any untrue statement of a
material fact or omits to state a material fact (known to Company in the case
of any document not furnished by it) necessary in order to make the statements
contained herein or therein not misleading in light of the circumstances in
which the same were made.  The
projections and pro forma financial information contained in such materials are
based upon good faith estimates and assumptions believed by Company and its
Subsidiaries to be reasonable at the time made, it being recognized by Lenders
that such projections as to future events are not to be viewed as facts and
that actual results during the period or periods covered by any such
projections may differ from the projected results.  There are no facts known to Company or any
Borrower (other than matters of a general economic nature) which materially and
adversely affects the business, operations, property, assets or condition
(financial or otherwise) of Company and its Subsidiaries, taken as a whole,
which have not been disclosed herein or in such other documents, certificates
and statements furnished to Lenders for use in connection with the transactions
contemplated hereby.


 


4.11        Environmental
Protection


 


Company
and each of its Subsidiaries are in compliance with all applicable
Environmental Laws in respect of the conduct of its business and the ownership
of its property, except such noncompliance as would not, individually or in the
aggregate, reasonably be expected to have a Material Adverse Effect.  Without limiting the effect of the preceding
sentence:


 


A.    to
the best of Company’s knowledge, neither Company nor any of its Subsidiaries
has received a complaint, order, citation, notice or other written
communication with respect to the existence or alleged existence of a violation
of, or liability arising under, any Environmental Law, the outcome of which,
individually or in the aggregate, would reasonably be expected to have a
Material Adverse Effect; and


 


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B.    to
the best of Company’s knowledge there are no environmental, health or safety
conditions existing at any real property owned, operated or leased by Company
or any of its existing or former Subsidiaries or any of their respective
predecessors, including off-site treatment or disposal facilities used by
Company or any of its existing or former Subsidiaries for waste treatment or
disposal, which would reasonably be expected to require any construction or
other capital costs or clean-up obligations to be incurred prior to the final
scheduled maturity of the Obligations in order to assure compliance with any
Environmental Law, including provisions regarding clean-up, to the extent that
any of such conditions, construction or other capital costs or clean-up
obligations, individually or in the aggregate, would reasonably be expected to
have a Material Adverse Effect.


 


4.12        Title to
Properties; Liens; Real Property; Intellectual Property


 


A.    Title to Properties; Liens.  Company
and its Subsidiaries have (i) good, sufficient and legal title to (in the case
of fee or freehold interests in Real Property Assets), (ii) valid
leasehold interests in (in the case of Ground Leasehold Interests, or other
leasehold interests in the UK, in Real Property Assets or personal property),
or (iii) good title to (in the case of all other personal property), all of
their respective properties and assets reflected in the financial statements
referred to in subsection 4.3 or in the most recent financial statements
delivered pursuant to subsection 5.1, in each case except for assets
disposed of since the date of such financial statements in the ordinary course
of business or as otherwise permitted under subsection 6.7 and except for such
defects that individually or in the aggregate, would not have a Material
Adverse Effect.  Except as permitted by
this Agreement, all such properties and assets are free and clear of Liens.


 


B.    Real Property. 
As of the Third Restatement Date, Schedule 4.12B-1 annexed hereto
contains a true, accurate and complete list of all fee and Ground Leasehold
Interests (or in the UK, all freehold and leasehold interests) in any Real
Property Assets with an insurable or assessed value in excess of $25,000,000.


 


C.    Intellectual
Property.  As of the Third
Restatement Date, Company and its Subsidiaries own or have the right to use all
Intellectual Property used in the conduct of their business, except where the
failure to own or have such right to use, individually or in the aggregate,
could not reasonably be expected to result in a Material Adverse Effect.  No claim has been asserted and is pending by
any Person challenging or questioning the use of any such Intellectual Property
or the validity or effectiveness of any such Intellectual Property, and Loan
Parties do not know of any valid basis for any such claim except for such
claims that, individually or in the aggregate, could not reasonably be expected
to result in a Material Adverse Effect. 
The use of such Intellectual Property by Company and its Subsidiaries
does not infringe on the rights of any Person, except for such claims and
infringements that, individually or in the aggregate, could not reasonably be
expected to result in a Material Adverse Effect.


 


4.13        Solvency


 


Each
Loan Party is and, upon the incurrence of any Obligations by such Loan Party on
any date on which this representation is made, will be, Solvent.


 


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4.14        Matters
Relating to Collateral


 


A.    Creation, Perfection and Priority of Liens.


 


(i)            As of the Third Restatement Date,
the execution and delivery of the Collateral Documents (except Mortgages and
fixture filings, until such time as same are required pursuant to
subsection 5.10) by Loan Parties (other than Avir and O-I Canada),
together with (i) the actions taken on or prior to or after the date hereof
pursuant to subsections the Original Credit Agreement, the First Amended and
Restated Credit Agreement, the Second Amended and Restated Credit Agreement, or
Section 5.9 and 5.10, and (ii) the delivery to Collateral Agent of any
Collateral not delivered to Collateral Agent at the time of execution and
delivery of the applicable Collateral Document (all of which Collateral has
been so delivered) are effective to create in favor of Collateral Agent for the
benefit of Lenders, as security for the respective Secured Obligations (as
defined in the applicable Collateral Document in respect of any Collateral), a
valid First Priority Lien on all of the Collateral, and all filings and other
actions necessary or desirable to perfect and maintain the perfection and First
Priority status of such Liens have been duly made or taken and remain in full
force and effect, other than the periodic filing of UCC continuation statements
and such other ongoing filings as may be required in the other jurisdictions in
which Collateral is located.


 


B.    Governmental Authorizations. 
No authorization, approval or other action by, and no notice to or
filing with, any Government Authority is required for either (i) the
pledge or grant by any Loan Party of the Liens purported to be created in favor
of Collateral Agent pursuant to any of the Collateral Documents or
(ii) the exercise by Collateral Agent of any rights or remedies in respect
of any Collateral (whether specifically granted or created pursuant to any of
the Collateral Documents or created or provided for by applicable law), except
for filings or recordings contemplated by subsection 4.14A and except as
may be required, in connection with the disposition of any Collateral, by laws
generally affecting the offering and sale of securities.


 


C.    Absence of Third-Party Filings. 
Except such as may have been filed in favor of Collateral Agent as
contemplated by subsection 4.14A and to evidence permitted lease
obligations and other Liens permitted pursuant to subsection 6.2, (i) no
effective UCC financing statement, fixture filing or other instrument similar
in effect covering all or any part of the Collateral is on file in any filing
or recording office, (ii) no effective filing covering all or any part of the
IP Collateral is on file in the PTO (or analogous foreign agencies with respect
to Collateral secured by the Offshore Collateral Documents), and (iii) no
effective filings, registrations or other notices of Liens exist in relation to
any of the Loan Parties or any of the Collateral at any agencies, registries
offices or relevant governmental or other regulatory bodies outside the United
States of America.


 


SECTION 5


 


COMPANY’S AFFIRMATIVE COVENANTS


 


Company,
each Domestic Borrower and each Offshore Borrower covenants and agrees that, so
long as any of the Commitments hereunder shall be in effect and until payment
in full of all of the Loans, the Offshore Overdraft Amounts and the Domestic
Overdraft Amount,


 


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the cancellation or expiration of all Letters of
Credit and the reimbursement of all amounts drawn thereunder, unless Requisite
Lenders shall otherwise give prior written consent, Company, each Domestic
Borrower and each Offshore Borrower shall perform, and shall cause each of
their respective Subsidiaries to perform, all covenants in this Section 5.


 


5.1          Financial Statements and Other Reports


 


Company
and Borrowers will maintain, and cause Holdings and each of their respective
Subsidiaries to maintain, a system of accounting established and administered
in accordance with sound business practices to permit preparation of
consolidated financial statements in conformity with GAAP (which, in the case
of financial statements of the Offshore Borrowers, shall mean generally
accepted accounting principles as applicable in their respective foreign
jurisdictions).  Company and Borrowers
will deliver, or cause to be delivered, to Lenders:


 


(i)            Quarterly Financials.  as soon as practicable and in any event
within 45 days after the end of each Fiscal Quarter, other than quarters which
are the last quarter in a Fiscal Year, (a) the consolidated balance sheets
of Holdings and Company as at the end of such period and the related
consolidated statements of income and cash flows of Holdings and Company for
the period from the beginning of the then current Fiscal Year to the end of
such Fiscal Quarter and (b) a statement setting forth sales and EBIT data
by Reporting Unit for the last month of such Fiscal Quarter and for the period
from the beginning of the then current Fiscal Year to the end of such Fiscal
Quarter, setting forth in the case of the statements described in clauses (a)
and (b) above in comparative form the corresponding figures for the
corresponding periods of the previous Fiscal Year and, with respect to the
consolidated statements of income and the statement of sales and EBIT data by
Reporting Unit, the corresponding figures from the consolidated plan and
financial forecast for the current Fiscal Year delivered pursuant to
subsection 5.1(x), all in reasonable detail and certified by the chief
accounting officer, the chief financial officer, the treasurer, an assistant
treasurer, the controller or an assistant controller of Company that they
fairly present the consolidated financial condition of Company and its
Subsidiaries as at the dates indicated and the consolidated results of
operations and cash flows for the periods indicated, subject to changes
resulting from audit and normal year-end adjustment and insofar as related to
Reporting Units based on Company’s normal accounting procedures applied on a
consistent basis;


 


(ii)           Year-End Financials.  as soon as practicable and in any event
within 90 days after the end of each Fiscal Year of Company (except in the case
of Australian Offshore Borrowers, which shall be delivered promptly after
becoming available) (a) the consolidated balance sheets of each of
Holdings, Company, each Domestic Borrower, each Australian Offshore Borrower and
BSN, in each case as at the end of such year and the related consolidated
statements of income, stockholders’ equity and cash flows of Holdings, Company,
each Domestic Borrower, each Australian Offshore Borrower and BSN for such
Fiscal Year and (b) a statement setting forth sales and EBIT data by
Reporting Unit for such Fiscal Year, setting forth in the case of the
statements described in clauses (a) and (b) above, in comparative form the
corresponding figures for the previous year and, with respect to the
consolidated statements of income


 


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and the statement of sales and EBIT data by Reporting
Unit, the corresponding figures from the consolidated plan and financial
forecast for the current Fiscal Year delivered pursuant to subsection 5.1(x),
all in reasonable detail, (c) in the case of such consolidated financial
statements accompanied by a report thereon of independent certified public
accountants of recognized national standing selected by Company which report
shall be unqualified as to going concern and scope of audit and shall state
that such consolidated financial statements present fairly the financial
position of Holdings and its Subsidiaries, Company and its Subsidiaries or each
Domestic Borrower, Australian Offshore Borrower and their respective
Subsidiaries and BSN and its Subsidiaries, as the case may be as at the dates
indicated and the results of their operations and cash flows for the periods
indicated in conformity with GAAP consistently applied and that the examination
by such accountants in connection with such consolidated financial statements
has been made in accordance with generally accepted auditing standards and
(d) in the case of such financial statements with respect to Reporting
Units, certified by the chief accounting officer, the chief financial officer,
the treasurer, an assistant treasurer, the controller or an assistant
controller of Company based on Company’s normal accounting procedures applied
on a consistent basis;


 


(iii)          Officers’ Certificates and
Compliance Certificates.  together
with each delivery of financial statements of Company and its Subsidiaries
pursuant to subdivisions (i) and (ii) above, (a) an Officers’
Certificate of Company stating that the signers thereof have reviewed the terms
of this Agreement and have made, or caused to be made under their supervision,
a review in reasonable detail of the transactions and condition of Company and
its Subsidiaries during the accounting period covered by such financial
statements and that such review has not disclosed the existence during or at
the end of such accounting period, and that such signers do not have knowledge
of the existence as at the date of the Officers’ Certificate, of any condition
or event which constitutes an Event of Default or Potential Event of Default,
or, if any such condition or event existed or exists, specifying the nature and
period of existence thereof and what action Company has taken, is taking and
proposes to take with respect thereto; and (b) a Compliance Certificate
demonstrating compliance (as determined in accordance with GAAP) during and at
the end of such accounting periods with the restrictions contained in
subsections 6.1, 6.2, 6.3, 6.4, 6.5, 6.6, 6.7 and 6.8 and, in addition, a
written statement of the chief accounting officer, chief financial officer,
treasurer, any assistant treasurer, controller or any assistant controller of
Company describing in reasonable detail (A) the differences between the
financial information contained in such financial statements and the
information contained in the Compliance Certificate relating to Company’s
compliance with subsections 6.6 and 6.8 and (B) the non-recurring cash
charges added back to Consolidated Net Income for purposes of calculating
Consolidated Adjusted EBITDA pursuant to clause (viii) of the definition
thereof;


 


(iv)          Accountants’ Certification.  to the extent required pursuant to clause (a)
or (b) below, together with each delivery of financial statements pursuant to
subdivisions (i) or (ii) of this subsection 5.1, a written statement from
the chief accounting officer, chief financial officer, treasurer, an assistant
treasurer, controller or any assistant controller of Company setting forth
(a) if necessary to explain any material changes in the consolidated
financial statements caused by the adoption of new


 


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accounting principles, a comparison and reconciliation
of the consolidated financial statements with pro forma consolidated financial
statements prepared as if the new accounting principles had not been adopted
(it being understood that, subject to the following clause (b), only one such
statement shall be required with respect to any particular adoption of any new
accounting principles) and (b) during the pendency of any negotiations
provided for in subsection 10.9 resulting from any change in accounting
principles and policies, the differences which would have resulted if such
financial statements had been prepared without giving effect to such change;


 


(v)           SEC Filings and Press Releases.  promptly upon their becoming available,
copies of (a) all annual reports and proxy statements sent or made available
generally by Holdings to its security holders or by any Subsidiary of Holdings
to its security holders other than Holdings or another Subsidiary, (b) all
reports (including, without limitation, its Annual Report on Form 10-K
and its Quarterly Report on Form 10-Q) and all registration statements of
Holdings or any of its Subsidiaries filed with the Securities and Exchange
Commission on Forms S-2, S-3, S-4 and 8-K, (c) all press releases and other
statements made available generally by Holdings, any Borrower or any of its
Domestic Subsidiaries or any of its material Foreign Subsidiaries to the public
concerning material developments in the business of Holdings or any of such
Subsidiaries, and (d) such other filings with the Securities and Exchange
Commission or any other regulatory agency having jurisdiction over the affairs
of Holdings and its Subsidiaries as Administrative Agent may reasonably
request;


 


(vi)          Events of Default, Etc.  promptly upon any Responsible Officer of
Company or any Borrower obtaining knowledge (a) of any condition or event
which constitutes an Event of Default or Potential Event of Default, or
becoming aware that any Lender or Administrative Agent has given any notice or
taken any other action with respect to a claimed Event of Default or Potential
Event of Default under this Agreement, (b) that any Person has given any
notice to Company or any Subsidiary of Company or taken any other action with
respect to a claimed default or event or condition of the type referred to in
subsection 7.2, or (c) of the occurrence of any event or change
(including any event or change relating to environmental or ERISA matters) that
has caused or evidences, or would reasonably be expected to give rise to,
either in any case or in the aggregate, a Material Adverse Effect, an Officers’
Certificate specifying the nature and period of existence of any such condition
or event, or specifying the notice given or action taken by such holder or
Person and the nature of such claimed default, Event of Default, Potential
Event of Default, event or condition, and what action Company or such Borrower
has taken, is taking and proposes to take with respect thereto;


 


(vii)         Litigation or Other Proceedings.  promptly upon any Responsible Officer of
Company or any Borrower obtaining knowledge of (a) the institution of, or
non-frivolous threat of, any action, suit, proceeding, governmental
investigation or arbitration against or affecting Company or any of its
Subsidiaries or any property of Company or any of its Subsidiaries not
previously disclosed by Company or a Borrower to Lenders, or (b) any
material development in any such action, suit, proceeding, governmental
investigation or arbitration, which, in either case, if adversely determined,
would reasonably be expected to cause a Material Adverse Effect, written


 


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notice thereof to Lenders and provide such other
information as may be reasonably available to it to enable Lenders and their
counsel to evaluate such matters;


 


(viii)        ERISA Events.  promptly upon becoming aware of the
occurrence of or forthcoming occurrence of any ERISA Event, a written notice
specifying the nature thereof, what action Company, any of its Subsidiaries or
any of their respective ERISA Affiliates has taken, is taking or proposes to
take with respect thereto and, when known, any action taken or threatened by
the Internal Revenue Service, the Department of Labor or the PBGC with respect
thereto;


 


(ix)           ERISA Notices.  with reasonable promptness, copies of (a) all
notices received by Company, any of its Subsidiaries or any of their respective
ERISA Affiliates from a Multiemployer Plan sponsor concerning an ERISA Event;
and (b) copies of such other documents or governmental reports or filings
relating to any Employee Benefit Plan as Administrative Agent or any Lender
through Administrative Agent shall reasonably request;


 


(x)            Financial Plans.  as soon as practicable and in any event
within 90 days after the beginning of each Fiscal Year of Company, a consolidated
plan and financial forecast, prepared in accordance with Company’s normal
accounting procedures applied on a consistent basis, for such Fiscal Year of
Company and its Subsidiaries, including, without limitation, (a) a
forecasted consolidated balance sheet, consolidated statement of income and
consolidated statement of cash flows of Company for such Fiscal Year,
(b) forecasted consolidated balance sheets and statements of income of
Company and a statement setting forth forecasted sales and operating income
data for each Reporting Unit for each Fiscal Quarter of such Fiscal Year, and
(c) the amount of forecasted capital expenditures and unallocated overhead
for such Fiscal Year;


 


(xi)           New Subsidiaries.  within 45 days of the end of the first,
second and third Fiscal Quarter, and within 90 days of the end of the fourth
Fiscal Quarter, as applicable, a written notice setting forth with respect to
all Persons becoming Subsidiaries of Company on such date during the previous
Fiscal Quarter, (a) the date on which such Person became a Subsidiary of
Company and (b) all of the data required to be set forth in Schedule 4.1
annexed hereto with respect to all Subsidiaries of Company (it being understood
that such written notice shall be deemed to supplement Schedule 4.1
annexed hereto for all purposes of this Agreement);


 


(xii)          Holdings Ordinary Course Payments.  within 90 days of the end of each Fiscal
Year, a written report in form satisfactory to Agents, setting forth by each
category set forth in the definition of such term all Holdings Ordinary Course
Payments during such Fiscal Year including a report in a form and covering the
matters covered in the report previously delivered to the Administrative Agent;
and


 


(xiii)         Other Information.  with reasonable promptness, such other
information and data with respect to Company or any of its Subsidiaries as from
time to time may be reasonably requested by any Lender through Administrative
Agent.


 


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Company and Borrowers shall be deemed to have
delivered reports referred to in clauses (i),(ii), (iii) or (v) of this
subsection 5.1 when (A) such reports or other information have been posted on
the Internet website of the Securities and Exchange Commission
(http://www.sec.gov) or on its own Internet website as previously identified to
Agents and Lenders, and (B) Company and Borrowers have notified Agents and
Lenders by electronic mail of such posting; provided that if any Agent or any
Lender requests such information to be delivered in hard copies, Company and/or
any Borrower, as applicable, shall furnish to such Agent or Lender, as
applicable, such information accordingly.


 


5.2          Corporate
Existence, Etc.


 


Company
and each Borrower will at all times preserve and keep in full force and effect
its corporate existence and rights and franchises material to its business and
the businesses of each of its Subsidiaries; provided, however,
that the existence of any such Subsidiary (other than any Domestic Borrower or
Offshore Borrower) may be terminated if its parent corporation determines that
such termination is in the best interest of such parent corporation.


 


5.3          Payment
of Taxes and Claims; Tax Consolidation


 


A.    Company
and each Borrower will, and will cause each of its Subsidiaries to, pay all
taxes, assessments and other governmental charges imposed upon it or any of its
properties or assets or in respect of any of its franchises, business, income
or property before any material penalty accrues thereon, and all claims
(including, without limitation, claims for labor, services, materials and
supplies) for sums which have become due and payable and which by law have or
may become a material Lien upon any of its properties or assets, prior to the
time when any material penalty or fine shall be incurred with respect thereto;
provided that no such charge or claim need be paid if being contested in good
faith by appropriate proceedings promptly instituted and diligently conducted
and if such reserve or other appropriate provision, if any, as shall be
required in conformity with GAAP shall have been made therefor.


 


B.    Company
will not, nor will it permit any of its Subsidiaries to, file or consent to the
filing of any consolidated income tax return with any Person (other than
Holdings or any of its Subsidiaries or such other Person as may be reasonably
acceptable to Requisite Lenders).


 


5.4                               Maintenance of Properties; Insurance;
Application of Net Insurance/Condemnation Proceeds


 


A.    Company
and Borrowers will maintain or cause to be maintained in good repair, working
order and condition all material properties used or useful in the business of
Company and its Subsidiaries and from time to time will make or cause to be
made all appropriate repairs, renewals and replacements thereof.  Company and Borrowers will each maintain or
cause to be maintained, with financially sound and reputable insurers,
insurance with respect to its properties and business and the properties and
business of its Subsidiaries against loss or damage of the kinds customarily insured
against by corporations of established reputation engaged in the same or
similar businesses and similarly situated, of such types and in such amounts as
are customarily carried under similar circumstances by such other corporations


 


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(“Industry Standards”) and may self insure to
the extent, and only to the extent, consistent with Industry Standards.  Without limiting the generality of the
foregoing, Company will maintain or cause to be maintained (i) flood insurance
with respect to each Flood Hazard Property that is located in a community that
participates in the National Flood Insurance Program, in each case in
compliance with any applicable regulations of the Board of Governors of the
Federal Reserve System, and (ii) replacement value casualty insurance on the
Collateral under such policies of insurance, with such insurance companies, in
such amounts, with such deductibles, and covering such risks as are at all
times satisfactory to Collateral Agent in its commercially reasonable judgment.
Each such policy of insurance shall (a) name Collateral Agent for the benefit
of Lenders as an additional insured thereunder as its interests may appear and
(b) in the case of each casualty insurance policy, contain a loss payable
clause or endorsement, satisfactory in form and substance to Collateral Agent,
that names Collateral Agent for the benefit of Lenders as the loss payee
thereunder for any covered loss in excess of $25,000,000 and provides for at
least 30 days’ prior written notice to Collateral Agent of any modification or
cancellation of such policy.


 


B.    Application
of Net Insurance/Condemnation Proceeds. 
Upon receipt by Company or any of its Domestic Subsidiaries, or by
Collateral Agent as loss payee, of any Net Insurance/Condemnation Proceeds, so
long as no Event of Default shall have occurred and be continuing, Company or
such Domestic Subsidiary shall cause to be deposited all such Net
Insurance/Condemnation Proceeds with Collateral Agent, and Collateral Agent
shall hold the same in the General Collateral Account pending a determination
by Company or its applicable Subsidiary as to whether the Company or applicable
Domestic Subsidiary (a) will repair, restore or replace the assets in respect
of which such Net Insurance/Condemnation Proceeds were received or (b) will
elect to cause prepayments of the Loans and/or the reduction of the Revolving
Loan Commitments as provided in subsection 2.4B.  The failure by Company or such Domestic
Subsidiary to make an election under the preceding sentence on or before the
date that is 120 days after receipt of the Net Insurance/Condemnation Proceeds
shall be deemed an election to cause the prepayments of the Loans and/or the
reduction in the Revolving Commitments as provided in subsection 2.4B and
Collateral Agent shall be entitled (but shall not be obligated) to use any Net
Insurance/Condemnation Proceeds held by Collateral Agent to prepay the Loans
and to make any other payments required under the Intercreditor Agreement.  If an Event of Default shall have occurred
and be continuing, Domestic Borrowers shall deliver to Collateral Agent for
application to the Loans if Collateral Agent so elects (or, if Collateral Agent
is holding Net Insurance/Condemnation Proceeds, Collateral Agent shall be
entitled to apply if it so elects) an amount equal to such portion of such Net
Insurance/Condemnation Proceeds to prepay the Loans (and/or reduce the
Revolving Loan Commitments) as provided in subsection 2.4B subject to any
limitations contained in the Intercreditor Agreement.  If any Net Insurance/Condemnation Proceeds
are released to Company or its applicable Subsidiary pursuant to this
subsection 5.4B, and any portion of such Net Insurance/Condemnation
Proceeds are not used to repair, replace or restore the assets in respect of
which such Net Insurance/Condemnation Proceeds were received, any amount of
such Net Insurance/Condemnation Proceeds not so used shall be applied to prepay
the Term Loans and/or reduce Revolving Loan Commitments as provided in
subsection 2.4B and shall be otherwise applied as required by the
Intercreditor Agreement.


 


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5.5          Inspection;
Lender Meeting


 


A.    Company
and Borrowers shall permit any authorized representatives designated by any
Lender, at the expense of that Lender, to visit and inspect any of the
properties of Company or any of its Subsidiaries, including its and their
financial and accounting records, and to make copies and take extracts
therefrom, and to discuss its and their affairs, finances and accounts with its
and their officers and independent public accountants, all upon reasonable
notice and at such reasonable times during normal business hours and as often
as may be reasonably requested.


 


B.    Company
and Borrowers will, upon the request of Agents or Requisite Lenders,
participate in a meeting of Agents and Lenders once during each Fiscal Year to
be held at Company’s principal offices (or at such other location as may be
agreed to by Company and Agents) at such time as may be agreed to by Company
and Administrative Agent.


 


5.6          Compliance
with Laws, Etc.


 


Company,
Borrowers and its/their Subsidiaries shall exercise all due diligence in order
to comply with the requirements of all applicable laws, rules, regulations and
orders (including all Environmental Laws) of any governmental authority,
noncompliance with which in any case or in the aggregate would reasonably be
expected to result in a Material Adverse Effect.


 


5.7          Securities
Activities


 


Following
the application of the proceeds of any Loans, not more than 25% of the value of
the assets (either of Company only or of Company and its Subsidiaries on a
consolidated basis) subject to the provisions of subsection 6.2 or 6.7, or
subject to any similar restriction contained in any agreement or instrument
between Company and any Lender or any Affiliate of any Lender relating to
Indebtedness and within the scope of subsection 7.2, will be attributable
to Margin Stock.


 


5.8          Environmental
Matters


 


A.    Environmental Disclosure. 
Company will deliver to Administrative Agent and Lenders:


 


(i)            Environmental Audits and Reports.  As soon as practicable following receipt
thereof, copies of all non-privileged environmental audits, investigations,
analyses and reports of any kind or character, whether prepared by personnel of
Company, any Borrower or any of its Domestic Subsidiaries or by independent
consultants, governmental authorities or any other Persons, with respect to
significant environmental matters at any Mortgaged Property that, individually
or in the aggregate, could reasonably be expected to result in a Material
Adverse Effect or with respect to any Environmental Claims that, individually
or in the aggregate, could reasonably be expected to result in a Material
Adverse Effect;


 


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(ii)           Notice of Certain Releases,
Remedial Actions, Etc.  Within 90
days following the end of each Fiscal Year, a written summary describing in
reasonable detail (a) any Release required to be reported to any federal, state
or local governmental or regulatory agency under any applicable Environmental
Laws, and (b) any remedial action taken by Company, any Borrower or any
other Domestic Subsidiary in response to (1) any Hazardous Materials
Activities the existence of which could reasonably be expected to result in one
or more Environmental Claims having, individually or in the aggregate, a
Material Adverse Effect, or (2) any Environmental Claims that,
individually or in the aggregate, could reasonably be expected to result in a
Material Adverse Effect.


 


(iii)          Written Communications Regarding
Environmental Claims, Releases, Etc. 
As soon as practicable following the sending or receipt thereof by
Company or any of its Subsidiaries, a copy of any and all non-privileged
written communications with respect to any Environmental Claims that,
individually or in the aggregate, could reasonably be expected to result in a
Material Adverse Effect.


 


(iv)          Notice of Certain Proposed Actions
Having Environmental Impact.  In
addition to the quarterly reporting required under subsection 5.1(xi),
prompt written notice describing in reasonable detail (a) any proposed
acquisition of stock, assets, or property by Company or any of its Subsidiaries
that could reasonably be expected to (1) expose Company or any of its
Subsidiaries to, or result in, Environmental Claims that could reasonably be
expected to result in, individually or in the aggregate, a Material Adverse
Effect or (2) affect the ability of Company or any of its Subsidiaries to
maintain in full force and effect all material Governmental Authorizations
required under any Environmental Laws for their respective operations and
(b) any proposed action to be taken by Company or any of its Subsidiaries
to modify current operations in a manner that could reasonably be expected to
subject Company or any of its Subsidiaries to any material additional
obligations or requirements under any Environmental Laws that could reasonably
be expected to result in, individually or in the aggregate, a Material Adverse
Effect.


 


B.    Company’s
Actions Regarding Hazardous Materials Activities, Environmental Claims and
Violations of Environmental Laws.


 


(i)            Remedial Actions Relating to
Hazardous Materials Activities. 
Company and each Borrower shall, in compliance with all applicable
Environmental Laws, promptly undertake, and shall cause each of its
Subsidiaries promptly to undertake, any and all investigations, studies,
sampling, testing, abatement, cleanup, removal, remediation or other response
actions necessary to remove, remediate, clean up or abate any Hazardous
Materials Activity on, under or about any Mortgaged Property that is in
violation of any Environmental Laws or that presents a material risk of giving
rise to an Environmental Claim.


 


(ii)           Actions with Respect to
Environmental Claims and Violations of Environmental Laws.  Company and each Borrower shall promptly
take, and shall cause each of its Subsidiaries promptly to take, any and all
actions necessary to


 


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(i) cure any violation of applicable Environmental
Laws by Company, any Borrower or its or their Subsidiaries that could
reasonably be expected to result in, individually or in the aggregate, a
Material Adverse Effect and (ii) make an appropriate response to any
Environmental Claim against Company or any of its Subsidiaries and discharge
any obligations it may have to any Person thereunder where failure to do so
could reasonably be expected to result in, individually or in the aggregate, a
Material Adverse Effect.


 


C.    Environmental Review and Investigation. 
Company and Borrowers each agree that Administrative Agent may, from
time to time and in its reasonable discretion, (i) retain, at Borrowers’
expense, an independent professional consultant to review any environmental
audits, investigations, analyses and reports relating to Hazardous Materials
prepared by or for Company and (ii) in the event (a) Administrative Agent
reasonably believes that Company or any Borrower or any of its or their
Subsidiaries has breached any representation, warranty or covenant contained in
this subsection 5.8 or that there has been a material violation of
Environmental Laws at any Mortgaged Property or by Company, any Borrower or any
of its or their Subsidiaries at any other location or (b) an Event of Default
has occurred and is continuing, conduct its own investigation of any Mortgaged
Property; provided that, in the case of any Facility no longer owned,
leased, operated or used by Company, any Borrower or any of its or their
Subsidiaries, Company shall only be obligated to use its best efforts to obtain
permission for Administrative Agent’s professional consultant to conduct an
investigation of such Facility.  For
purposes of conducting such a review and/or investigation, Company and each
Borrower hereby grants to Administrative Agent and its agents, employees,
consultants and contractors the right to enter into or onto any Mortgaged
Property currently owned, leased, operated or used by Company, any Borrower or
any of its or their Subsidiaries and to perform such tests on such property
(including taking samples of soil, groundwater and suspected
asbestos-containing materials) as are reasonably necessary in connection
therewith.  Any such investigation of any
Facility shall be conducted, unless otherwise agreed to by Company, the
relevant Borrower and Administrative Agent, during normal business hours and,
to the extent reasonably practicable, shall be conducted so as not to interfere
with the ongoing operations at such Facility or to cause any damage or loss to
any property at such Facility.  Company,
Borrowers and Administrative Agent hereby acknowledge and agree that any report
of any investigation conducted at the request of Administrative Agent pursuant
to this subsection 5.8C will be subject to the provisions of
subsection 10.20 and will be obtained and shall be used by Administrative
Agent and Lenders solely for the purposes of Lenders’ internal credit
decisions, to monitor and police the Loans and to protect Lenders’ security
interests created by the Loan Documents or in connection with any transaction
relating to the Loans or to such Facility. Administrative Agent agrees to
deliver a copy of any such report to Company with the understanding that
Company and each Borrower acknowledge and agree that (x) it will indemnify
and hold harmless Administrative Agent and each Lender from any costs, losses
or liabilities relating to Company’s use of or reliance on such report,
(y) neither Administrative Agent nor any Lender makes any representation
or warranty with respect to such report, and (z) by delivering such report
to Company, neither Administrative Agent nor any Lender is requiring or
recommending the implementation of any suggestions or recommendations contained
in such report.


 


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5.9                               Execution of Subsidiary Guaranty and Security Agreement After the Third Restatement
Date.


 


A.    Execution of Subsidiary
Guaranty and Security Agreement.  In the event
that (a) any wholly-owned Domestic Subsidiary of Company existing on the Third Restatement
Date (other than the Harbor Capital Subsidiaries) that has not previously
executed the Subsidiary Guaranty or (b) any Person becomes a wholly-owned
Domestic Subsidiary of Company after the Third Restatement Date (other than a
Domestic Subsidiary formed in connection with any Receivables Sale Indebtedness
and other than any Domestic Subsidiary subject to a restriction permitted under
subsection 6.2B prohibiting such Subsidiary’s execution of the Subsidiary
Guaranty and/or the Security Agreement), and such Subsidiary owns or acquires
assets with an aggregate fair market value (without netting such fair market
value against any liability of such Subsidiary) exceeding $5,000,000, Borrowers’
Agent will promptly notify Administrative Agent of that fact and cause such
Domestic Subsidiary to execute and deliver to Administrative Agent a
counterpart of the Subsidiary Guaranty and a counterpart of the Security
Agreement and to take all such further actions and execute all such further
documents and instruments as may be necessary or, in the opinion of Collateral
Agent, desirable to create in favor of Collateral Agent, for the benefit of
Lenders, a valid and perfected First Priority Lien on all of the personal and
mixed property assets of such Domestic Subsidiary described in the applicable
forms of Collateral Documents. To the extent any such Subsidiary is owned by a
Subsidiary Guarantor, the Capital Stock of such Subsidiary shall be pledged
pursuant to the Security Agreement.


 


B.    Foreign Subsidiaries.  In the event that any Person becomes an English
Wholly-Owned Subsidiary or Australian Wholly-Owned Subsidiary after the date
hereof, or becomes a Subsidiary of BSN organized in France, Germany, the
Netherlands, Spain or Luxembourg (other than any special purpose vehicle formed
in connection with the incurrence or maintenance of Receivables Sale
Indebtedness permitted hereunder), and such Subsidiary owns or acquires assets
with an aggregate fair market value (without netting such fair value against a
liability of such Subsidiary) exceeding $5,000,000, Borrowers’ Agent will
promptly notify Collateral Agent of that fact and cause such Subsidiary, to the
extent legally permissible in the case of Subsidiaries organized in France or
Germany, to execute and deliver to Collateral Agent a counterpart of the
applicable Offshore Guaranty and a counterpart of the applicable Offshore
Security Agreement and such documents and instruments and take such further
actions as may be necessary, or in the reasonable opinion of Collateral Agent,
desirable to create in favor of Collateral Agent, for the benefit of Lenders, a
valid and perfected First Priority Lien on all of the personal and mixed
property assets of such Subsidiary described in the applicable forms of
Collateral Documents. If, on or after the Third Restatement Date, a
wholly-owned Foreign Subsidiary becomes a Foreign Subsidiary directly owned by
a Subsidiary Guarantor, the Capital Stock of such Foreign Subsidiary shall be
pledged pursuant to the Security Agreement unless Collateral Agent agrees
otherwise due to the illegality or impracticality of such pledge.


 


C.    Subsidiary Organizational
Documents, Legal Opinions, Etc.  Company and
Borrowers shall deliver to Administrative Agent, together with such Loan
Documents, (i) certified copies of such Subsidiary’s Organizational
Documents, together with, if such Subsidiary is a Domestic Subsidiary, a good
standing certificate from the Secretary of State (or other applicable
authority) of the jurisdiction of its organization, each to be dated a recent
date prior to their delivery to Administrative Agent, (ii) a certificate
executed by the secretary or


 


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similar officer of such
Subsidiary as to (a) the fact that the attached resolutions of the
Governing Body of such Subsidiary approving and authorizing the execution,
delivery and performance of such Loan Documents 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 Loan Documents,
and (iii) if such Subsidiary owns assets with a value in excess of
$100,000,000, 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 Loan Documents, (c) the enforceability of such Loan Documents against
such Subsidiary and (d) such other matters (including matters relating to
the creation and perfection of Liens in any Collateral pursuant to such Loan
Documents) as Administrative Agent may reasonably request, all of the foregoing
to be satisfactory in form and substance to Administrative Agent and its
counsel.


 


5.10        Real Estate
Matters


 


A.            As to (i) each Real Property Asset listed
on Schedule 4.12B-1 annexed hereto (each, an “Existing Mortgaged Property”, and collectively, the “Existing Mortgage Properties”), any amendment to the existing
Mortgage encumbering such Existing Mortgaged Property (an “Existing Mortgage”) and related documentation to the
extent deemed necessary by the Administrative Agent, and (ii) in the event,
from and after the Third Restatement Date that (x) Company, any Borrower,
any Subsidiary Guarantor or any Offshore Guarantor organized in Australia, the
UK, the Netherlands or Spain acquires any fee or Ground Leasehold Interest in a
Real Property Asset (or freehold title, in the case of a Real Property Asset
located in the UK) the acquisition cost of which (including purchase-money
Indebtedness or assumed Indebtedness) or insurable value of which exceeds
$50,000,000 or (y) at the time any Person becomes a Subsidiary Guarantor or
Offshore Guarantor organized in Australia, the UK, the Netherlands or Spain,
such Person owns or holds any fee or Ground Leasehold Interest in a Real
Property Asset (or freehold title, in the case of a Real Property Asset located
in the UK) with an assessed or insurable value in excess of $50,000,000 excluding
any such Real Property Asset the encumbrancing of which requires the consent of
(in the case of clause (y) above) a then-existing senior lienholder, where
Company and its Subsidiaries are unable to obtain such senior lienholder’s
consent (any Real Property Asset described in clause (i) and any such
non-excluded Real Property Asset described in the clause (ii) above being an “Additional Mortgaged Property”), Company
or such Subsidiary Guarantor shall deliver to Collateral Agent, within 60 days
of the Third Restatement Date in the case of any amendment to the Existing
Mortgages (subject to extensions as approved by Collateral Agent) and as soon
as practicable after such Person acquires such Additional Mortgaged Property or
becomes a Subsidiary Guarantor or Offshore Guarantor, as the case may be, the
following as applicable:


 


(i)            Mortgage.  A fully
executed and notarized Mortgage or amendment to an Existing Mortgage, as
applicable, duly recorded in all appropriate places in all applicable
jurisdictions, encumbering the interest of such Loan Party in such Existing
Mortgaged Property or Additional Mortgage Property (any such Mortgage
encumbering an Additional Mortgaged Property being an “Additional Mortgage”);


 


(ii)           Landlord Consents and Estoppels; Recorded
Leasehold Interests.  In the case of each Additional Mortgaged
Property located in the United States 


 


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of
America and consisting of a Ground Leasehold Interest, (a) a Landlord Consent
and Estoppel with respect thereto (to the extent such Loan Party can obtain
same using its commercially reasonable efforts) and (b) evidence that such
Ground Leasehold Interest is a Recorded Leasehold Interest;


 


(iii)          Title Insurance. 
With respect to any Additional Mortgaged Property located in the United
States of America:  (a) if required by
Administrative Agent, an ALTA mortgagee title insurance policy or an
unconditional commitment therefor issued by a Title Company, in an amount
satisfactory to Administrative Agent, insuring fee simple title to or a valid
leasehold interest in, such Additional Mortgaged Property vested in such Loan
Party and assuring Agents that such Mortgage creates a valid and enforceable
First Priority mortgage Lien on such Additional Mortgaged Property, subject
only to a standard survey exception and Permitted Encumbrances and Liens otherwise
permitted under subsection 6.2, which policy (1) shall include an
endorsement for mechanics’ liens, for future advances under this Agreement and
for any other matters reasonably requested by Administrative Agent and (2)
shall provide for affirmative insurance and such reinsurance as Administrative
Agent may reasonably request, all of the foregoing in form and substance
reasonably satisfactory to Administrative Agent; and (b) evidence satisfactory
to Administrative Agent that such Loan Party has (i) delivered to the title
company all certificates and affidavits required by the Title Company in
connection with the issuance of such policy and (ii) paid to the title company
or to the appropriate governmental authorities all expenses and premiums of the
Title Company in connection with the issuance of such policy and all recording
and stamp taxes (including mortgage recording and intangible taxes) payable in
connection with recording such Mortgage in the appropriate real estate records;


 


(iv)          Title Report, Certificate of Title. 
If no title insurance policy is required with respect to an
Additional  Mortgaged Property located in
the United States of America, a preliminary title report issued by a Title
Company, dated not more than 30 days prior to the date such Mortgage is to be
recorded and satisfactory in form to Administrative Agent; or, in the case of
any Additional Mortgaged Property located in the UK or Australia, a certificate
of title prepared by Borrowers’ counsel or other customary assurances of title.


 


(v)           Copies of Documents Relating to Title
Exceptions.  Copies of all recorded documents listed as
exceptions to title or otherwise referred to in the additional title insurance
policy or title report delivered pursuant to clause (iii) and (iv) above;


 


(vi)          Matters Relating to Flood Hazard
Properties.  With respect to each Additional Mortgaged
Property located in the United States of America:  (a) Evidence, which may be in the form of a
letter from an insurance broker or a municipal engineer, as to (1) whether
such Additional Mortgaged Property is a Flood Hazard Property and (2) if
so, whether the community in which such Flood Hazard Property is located is
participating in the National Flood Insurance Program, (b) if such Additional
Mortgaged Property is a Flood Hazard Property, such Loan Party’s written
acknowledgement of receipt of written notification from Administrative Agent
(1) that 


 


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such
Additional Mortgaged Property is a Flood Hazard Property and (2) as to
whether the community in which such Flood Hazard Property is located is
participating in the National Flood Insurance Program, and (c) in the event
such Additional Mortgaged Property is a Flood Hazard Property that is located
in a community that participates in the National Flood Insurance Program,
evidence that Company has obtained flood insurance in respect of such Flood
Hazard Property to the extent required under the applicable regulations of the
Board of Governors of the Federal Reserve System; and


 


(vii)         Environmental Audit. 
If required by Administrative Agent, reports and other information, in
form, scope and substance satisfactory to Administrative Agent and prepared by
environmental consultants satisfactory to Administrative Agent, concerning any
material environmental hazards or liabilities to which Company or any of its
Subsidiaries may be subject with respect to such Additional Mortgaged Property.


 


SECTION 6


 


COMPANY’S NEGATIVE
COVENANTS


 


Company
and each Borrower covenants and agrees that, so long as any of the Commitments
hereunder shall remain in effect and until payment in full of all of the Loans,
the Notes, the Offshore Overdraft Amounts and the Domestic Overdraft Amount and
other Obligations and the cancellation or expiration of all Letters of Credit
and reimbursement of all amounts drawn thereunder, unless Requisite Lenders
shall otherwise give prior written consent, Company and each Borrower shall
perform, and shall cause each of its respective Subsidiaries to perform, all
covenants in this Section 6.


 


6.1          Indebtedness


 


Company
and each Borrower shall not, and shall not permit any of its Subsidiaries to,
directly or indirectly, create, incur, assume or guaranty, or otherwise become
or remain directly or indirectly liable with respect to, any Indebtedness,
except:


 


(i)            Loan Parties may become and remain liable
with respect to the Obligations and may guaranty the Obligations and the Other
Lender Guarantied Obligations pursuant to their respective Guaranties;


 


(ii)           Company and its Subsidiaries may become
and remain liable with respect to Contingent Obligations permitted by
subsection 6.4 and, upon any matured obligations actually arising pursuant thereto,
the Indebtedness corresponding to the Contingent Obligations so extinguished;


 


(iii)          Company and its Subsidiaries may become
and remain liable with respect to Indebtedness in respect of Capital Leases
aggregating not in excess of $250,000,000 at any one time;


 


(iv)          Company may become and remain liable with
respect to Indebtedness to any of its Subsidiaries, and any Subsidiary of
Company may become and remain liable with respect to Indebtedness to Company or
any other Subsidiary of


 


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Company;
provided that, except with respect to Indebtedness of BSN and its
Subsidiaries existing on the BSN Acquisition Closing Date, (a) all such
intercompany Indebtedness shall be evidenced by promissory notes to the extent
it evidences Indebtedness owed to a Loan Party (unless promissory notes are not
recognized evidences of indebtedness under the applicable law governing such
Indebtedness), (b) all such intercompany Indebtedness owed by Company or any Borrower
shall be subordinated in right of payment to the payment in full of the
Obligations pursuant to the terms of the applicable promissory notes or an
intercompany subordination agreement, and (c) any payment by any Subsidiary of
Company under any guaranty of the Obligations shall result in a pro  tanto
reduction of the amount of any intercompany Indebtedness owed by such
Subsidiary to any Domestic Borrower or to any of their respective Subsidiaries
for whose benefit such payment is made and, with respect to Indebtedness of BSN
or any of its Subsidiaries, such Indebtedness shall be subordinated in right of
payment to the French Tranche C1 Term Loans and French Tranche C2 Term Loans as
set forth in the BSN Intercreditor Agreements and the Joinder to the Second
Amended and Restated Credit Agreement executed by BSN on the BSN Acquisition Closing
Date; and Company may become and remain liable with respect to Indebtedness to
Holdings; provided that such Indebtedness shall be evidenced by its
existing subordinated intercompany note dated as of April 23, 2001, as amended
prior to the First Restatement Date (which subordinated note shall not be
further amended without the consent of Administrative Agent);


 


(v)           Company and its Subsidiaries, as
applicable, may remain liable with respect to Indebtedness or the commitments
therefor described in Schedule 6.1 annexed hereto and any extensions,
renewals and refinancings of the Indebtedness or the commitments therefor
described in Part I thereof to the extent that such extensions, renewals
and refinancings thereof do not result in an increase in the aggregate
principal amount or commitment amount of such Indebtedness as described in such
Part I;


 


(vi)          Company and Packaging may remain liable
with respect to the Existing Holdings Senior Notes on a subordinated basis;


 


(vii)         Company and the other Loan Parties may
become and remain liable with respect to New Senior Debt;


 


(viii)        Company and Packaging may become and
remain liable with respect to Refinancing Senior Debt on a subordinated basis;


 


(ix)           Company and Packaging may become and
remain liable with respect to New Junior Debt on a subordinated or unsecured
basis or both;


 


(x)            Company and its Subsidiaries may become
and remain liable with respect to Purchase Money Indebtedness in an aggregate
principal amount not to exceed $200,000,000 at any time outstanding;


 


(xi)           In addition to Indebtedness permitted by
the other clauses of this subsection, Foreign Subsidiaries of Company may
become and remain liable with respect to other Indebtedness in an aggregate
principal amount not to exceed 


 


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$656,000,000
at any time outstanding (inclusive of amounts outstanding or committed under Schedule
6.1, Part II);


 


(xii)          In addition to Indebtedness permitted by the
other clauses of this subsection, Company and its Domestic Subsidiaries may
become and remain liable with respect to other Indebtedness in an aggregate
principal amount not to exceed $200,000,000 at any time outstanding;


 


(xiii)         Company and its Subsidiaries may become
and remain liable with respect to Acquired Indebtedness;


 


(xiv)        Company and its Subsidiaries may become
and remain liable with respect to Receivables Sale Indebtedness;


 


(xv)         BSN and its Subsidiaries liable therefor
on the Third Restatement Date may remain liable with respect to the BSN Senior
Subordinated Notes in an aggregate principal amount not to exceed the aggregate
principal amount of BSN Senior Subordinated Notes outstanding on the BSN
Acquisition Closing Date and Company and its Subsidiaries may become and remain
liable with respect to any Indebtedness renewing or refinancing the same
provided that such Indebtedness either (I)(a) if secured, is secured only by
all or any portion of the collateral securing the 9 1⁄4% Senior Subordinated
Notes, (b) is subordinated in right of payment on terms substantially
equivalent to those applicable to the applicable BSN Senior Subordinated Notes (and
to the extent secured, the Liens securing the same are subordinated on terms
substantially equivalent to those applicable to the Liens securing the 9 1⁄4%
Senior Subordinated Notes) or on other terms approved by Administrative Agent,
(c) has no obligors other than one or more persons liable for the applicable
BSN Senior Subordinated Notes refinanced thereby and/or any other Foreign
Subsidiary (other than any Loan Party, except for Avir), (d) has a Weighted
Average Life to Maturity longer than the BSN Senior Subordinated Notes, and (e)
is in an aggregate principal amount not exceeding the amount of BSN Senior
Subordinated Notes so refinanced plus related fees and expenses and applicable
premiums or (II) constitutes Additional Term Loans or Refinancing Term Loans
the proceeds of which are permitted to be applied to refinance BSN Senior
Subordinated Notes pursuant to subsection 2.5A or are debt securities permitted
under subsection 6.1(vii) — (ix) the Net Debt Securities Proceeds of which are
permitted to be applied to refinance the BSN Senior Subordinated Notes pursuant
to subsection 2.4B(ii)(e);


 


(xvi)        BSN Glasspack Services may remain liable
with respect to the BSN Receivables Securitization Facility in an aggregate
principal amount outstanding not to exceed €210,000,000; and


 


(xvii)       BSN and its Subsidiaries may become and
remain liable with respect to additional working capital financing, in an
aggregate principal amount not to exceed €80,000,000 and committed for no less
than three years, so long as the principal amount of the French Tranche C1 Term
Loans and French Tranche C2 Term Loans have been repaid in an amount at least
equal to the US Dollar equivalent of the committed amount of such financing.


 


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6.2          Liens
and Related Matters


 


A.    Prohibition on Liens.  Company and
each Borrower shall not, and shall not permit any of its Subsidiaries to,
directly or indirectly, create, incur, assume or permit to exist any Lien on or
with respect to any property or asset of any kind (including any document or
instrument in respect of goods or accounts receivable) of Company, any Borrower
or any of their Subsidiaries, whether now owned or hereafter acquired, or any
income or profits therefrom, or file or permit the filing of, or permit to
remain in effect, any financing statement or other similar notice of any Lien
with respect to any such property, asset, income or profits under the UCC or
under any similar recording or notice statute, except:


 


(i)            Permitted Encumbrances;


 


(ii)           Liens granted pursuant to the Collateral
Documents;


 


(iii)          Liens described in Schedule B
annexed hereto (“Existing Liens”) and Liens securing Indebtedness incurred to refinance any
Indebtedness secured by Existing Liens so long as (a) the principal amount of
such refinancing Indebtedness does not exceed the greater of (1) the fair
market value of the assets subject to such Lien and (2) the principal amount
(or, if greater, the committed amount) of the Indebtedness refinanced thereby
and (b) such refinancing Indebtedness is not secured by any collateral which
did not secure the Indebtedness refinanced thereby;


 


(iv)          Liens securing Purchase Money Indebtedness
permitted by subsection 6.1(x) and arising from the giving, simultaneously with
or within 180 days after the acquisition, construction or improvement of real
property or tangible personal property, of any purchase money Lien (including
vendors’ rights under purchase contracts under an agreement whereby title is
retained for the purpose of securing the purchase price thereof) on real
property or tangible personal property acquired, constructed or improved and
not theretofore owned by Company, any Borrower or any of its Subsidiaries, or
from the acquiring of real property or tangible personal property not theretofore
owned by Company, any Borrower or any of its Subsidiaries subject to any
then-existing Lien (whether or not assumed), or from the extension, renewal or
replacement of any Indebtedness secured by any of the foregoing Liens so long
as the aggregate principal amount thereof and the security therefor is not
thereby increased; provided, however, that in each case (a) such
Lien is limited to such acquired, constructed or improved real or tangible
personal property and fixed improvements, if any, then existing or thereafter
erected thereon, and (b) the principal amount of the Indebtedness secured by
such Lien, together (without duplication) with the principal amount of all
other Indebtedness secured by Liens on such property, shall not exceed the cost
(which shall be deemed to include, without duplication, the amount of
Indebtedness secured by Liens, including existing Liens, on such property) of
such property to Company, any Borrower or its applicable Subsidiary;


 


(v)           [omitted]


 


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(vi)          Liens on acquired assets securing
Acquired Indebtedness; provided that such Liens were created prior to
the acquisition of such acquired assets or acquired Subsidiary;


 


(vii)         In addition to Liens permitted by the
other clauses of this subsection, Liens on the assets of Foreign Subsidiaries
securing Indebtedness or other obligations of such Foreign Subsidiaries (other
than the Australian Offshore Borrowers, United Glass, BSN and its Subsidiaries and
Offshore Guarantors);


 


(viii)        In addition to Liens permitted by the
other clauses of this subsection, Liens securing Indebtedness or Contingent
Obligations of Company and its Subsidiaries in an aggregate principal amount
not to exceed $200,000,000 at any time outstanding;


 


(ix)           Liens securing Receivables Sale
Indebtedness; provided that such Liens encumber solely the receivables
so sold and customary related assets (including cash reserves established in
connection therwith);


 


(x)            Liens on deposits of cash or Cash
Equivalents securing bona-fide hedging arrangements with Lenders or Affiliates
thereof;


 


(xi)           Liens on the Capital Stock of BSN and
certain assets of BSN and its Subsidiaries securing the obligations of BSN
under the BSN Senior Subordinated Notes and any Indebtedness refinancing the
same permitted under subsection 6.1(xv)(I); provided that (a) in the
case of Liens securing obligations of BSN under the BSN Senior Subordinated
Notes, such Liens shall be limited to assets securing (or, pursuant to the
existing governing documentation therefor, required to secure) such BSN Senior
Subordinated Notes as of the Second Restatement Date and such Liens are subordinated
to the Liens securing the French Tranche C1 Term Loans and French Tranche C2
Term Loans pursuant to the BSN Intercreditor Agreements or otherwise on terms
and conditions satisfactory to Administrative Agent and (b) in the case of
Indebtedness refinancing such BSN Senior Subordinated Notes, such Liens are
limited to assets and subordinated as described in subsection 6.1(xv)(I); and


 


(xii)          Liens on the inventory of BSN and its
Subsidiaries securing the obligations of BSN and its Subsidiaries under the
working capital financing described in subsection 6.1(xvii).


 


B.    No Restrictions on Subsidiary Distributions to Company
or Other Subsidiaries.  Company and Borrowers will
not, and will not permit any of its or their Subsidiaries to, create or
otherwise cause or suffer to exist or become effective any consensual
encumbrance or restriction of any kind on the ability of any such Subsidiary to
(i) pay dividends or make any other distributions on any of such Subsidiary’s
Capital Stock owned by Company or any other Subsidiary of Company, (ii) repay
or prepay any Indebtedness owed by such Subsidiary to Company or any other
Subsidiary of Company, (iii) make loans or advances to Company or any other
Subsidiary of Company, or (iv) transfer any of its property or assets to
Company or any other Subsidiary of Company, except for such restrictions or
encumbrances 


 


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existing by reason of (a)
any restrictions existing under any of the Loan Documents or any other
agreements or contracts in effect on the Third Restatement Date, (b) any
restrictions with respect to any Person that becomes a Subsidiary of Company
after the Third Restatement Date under any agreement in existence at the time
such Person becomes such a Subsidiary, (c) any restrictions with respect to any
Subsidiary of Company imposed pursuant to an agreement which has been entered
into for the sale or disposition of all or substantially all of the Capital
Stock or assets of such Subsidiary, (d) any restrictions with respect to any
Subsidiary of Company all or substantially all of whose assets consist of
property encumbered by Liens permitted under subsection 6.2A, (e) restrictions
imposed by applicable laws, (f) restrictions under leases of, or mortgages and
other agreements relating to Liens on, specified property or assets limiting or
prohibiting transfers of such property or assets (including, without
limitation, non-assignment clauses, due-on-sale clauses and clauses prohibiting
junior Liens), (g) any restrictions under indentures governing New Senior Debt,
which restrictions are either substantially the same as those under clause (h)
or are approved by Administrative Agent, (h) any restrictions under the
indentures governing the Existing Owens-Brockway Senior Secured Notes, the
Existing Owens-Brockway Senior Unsecured Notes and the BSN Senior Subordinated
Notes, and (i) any restrictions existing under any agreement that amends,
refinances or replaces any agreement containing restrictions permitted under the
preceding clauses (a) through (h); provided that the terms and conditions of
any such agreement, as they relate to any such restrictions, are no less
favorable to Company, Borrowers and such Subsidiaries, as applicable, taken as
a whole, than those under the agreement so amended, refinanced or replaced.


 


6.3          Investments;
Acquisitions


 


Company
and Borrowers shall not, and shall not permit any of its or their Subsidiaries
to, directly or indirectly, make or own any Investment in any Person, including
any Joint Venture, or acquire, by purchase or otherwise, all or substantially
all the business, property or fixed assets of, or Capital Stock or other
ownership interest of any Person, or any division or line of business of any
Person (each such acquisition, an “Acquisition”)
except:


 


(i)            Company and its Domestic Subsidiaries may
make and own Investments in Cash Equivalents and the Foreign Subsidiaries may
make and own Investments in Cash Equivalents and short term investments similar
to Cash Equivalents customarily used in the countries in which they are
located;


 


(ii)           Company and its Subsidiaries may continue
to own the Investments owned by them as of the Second Restatement Date in any
Subsidiaries of Company, and Company and its Domestic Subsidiaries may form new
wholly-owned Domestic Subsidiaries and make and own additional equity
Investments in their respective wholly-owned Domestic Subsidiaries and Foreign
Subsidiaries may form new wholly-owned Foreign Subsidiaries and make and own
additional equity investments in their respective wholly-owned Foreign
Subsidiaries;


 


(iii)          Company and its Subsidiaries may make
intercompany loans to the extent permitted under subsection 6.1(iv); provided,
that the aggregate amount of such intercompany loans made in cash by Loan
Parties (other than Avir or O-I Canada) to non-Loan Parties, Avir or O-I Canada
from and after the Second Restatement Date and outstanding at any 


 


146





















 


time shall not exceed
$500,000,000 minus the amount of Investments made by Loan Parties (other than
Avir or O-I Canada) in non-Loan Parties, Avir or O-I Canada pursuant to
subsection 6.3(vi) from and after the Second Restatement Date;


 


(iv)          Company and its Subsidiaries may continue
to own the Investments owned by them and described in Schedule 6.3
annexed hereto and make the Investments contemplated by Schedule 6.3;


 


(v)           Company, its Domestic Subsidiaries and
the other Loan Parties (other than Avir and O-I Canada) may make Acquisitions; provided
that aggregate consideration paid or given (including, without limitation, cash
paid, Acquired Indebtedness or assumed Indebtedness and the value of any other
consideration paid or given, other than Capital Stock of Holdings issued in
connection with such Acquisition) for all Acquisitions after the Second Restatement
Date does not exceed $250,000,000; provided  further that Company
and Domestic Borrowers shall comply with and shall cause their Subsidiaries to
comply with subsections 5.9 and 5.10 hereof; and provided  still
further that upon from and after the first such date that the Consolidated
Leverage Ratio is less than 3.5:1, Company, its Domestic Subsidiaries and the
other Loan Parties (other than Avir and O-I Canada) may make additional
Acquisitions such that the aggregate consideration paid or given for all
Acquisitions (including those made after the Second Restatement Date and prior
to such first such date) does not exceed $500,000,000;


 


(vi)          Company and its Subsidiaries may make
additional Investments in their respective Foreign Subsidiaries; provided
that the amount of all such Investments made after the Second Restatement Date
minus the aggregate amount of all cash dividends, distributions and other cash
payments actually received by Company and its Subsidiaries (other than Foreign
Subsidiaries) from their respective Foreign Subsidiaries after the Second Restatement
Date, shall not exceed $250,000,000; and provided  still further
that upon and from and after the first such date that the Consolidated Leverage
Ratio is less than 3.5:1, Company and its Subsidiaries may make additional
Investments in their respective Foreign Subsidiaries such that the aggregate
amount for all such Investments (including those made after the Second
Restatement Date and prior to such first such date) minus the aggregate amount
of all cash dividends, distributions and other cash payments actually received
by Company and its Subsidiaries (other than Foreign Subsidiaries) from their
respective Foreign Subsidiaries after the Second Restatement Date (including
those received  after the Second Restatement
Date and prior to such first such date) does not exceed $500,000,000;


 


(vii)         Company and its Subsidiaries may make and
own Investments arising in connection with Commodities Agreements entered into
in accordance with current industry practice (at the time of making any such
Investment) or the past practices of Company and its Subsidiaries;


 


(viii)        Company may acquire and hold obligations
of one or more officers or other employees of Company or its Subsidiaries in
connection with such officers’ or employees’ acquisition of shares of Holdings’
common stock, so long as no cash is actually advanced by Company or any of its
Subsidiaries to such officers or employees in connection with the acquisition
of any such obligations;


 


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(ix)           Company and its Subsidiaries may receive
and hold promissory notes and other non-cash consideration received in
connection with any Asset Sale or other sales of assets permitted by subsection
6.7;


 


(x)            Company and its Subsidiaries may acquire
Securities in connection with the satisfaction or enforcement of Indebtedness
or claims due or owing to Company or any of its Subsidiaries or as security for
any such Indebtedness or claim;


 


(xi)           Foreign Subsidiaries of Company other
than Offshore Borrowers (except Avir and O-I Canada) and Offshore Guarantors
may make Investments, Acquisitions and acquire assets (including Capital Stock
and including Capital Stock of Foreign Subsidiaries other than Offshore
Borrowers and Offshore Guarantors formed in connection with any such
acquisition);


 


(xii)          Company and its Subsidiaries may make and
own additional Investments in Joint Ventures made after the Second Restatement
Date in an aggregate amount not to exceed at any time $100,000,000;


 


(xiii)         In addition to Investments permitted by
the other clauses of this subsection, Company and its Subsidiaries may make and
own other Investments in an aggregate amount not to exceed at any time
$125,000,000;


 


(xiv)        Company and
its Subsidiaries may enter into and consummate transactions described in
subsection 6.7(i) and 6.7(x);


 


(xv)         BSN and its Subsidiaries may continue to
own the Investments owned by them as of the BSN Acquisition Closing Date;


 


(xvi)        Owens-Brockway and its Subsidiaries may
continue to own the Investments made with the proceeds of  “Domestic Tranche C Term Loans” and “Tranche
D Term Loans” (each as defined in the Second Amended and Restated Credit
Agreement) on the BSN Acquisition Closing Date; and


 


(xvii)       Owens-Brockway and its Subsidiaries may
contribute and/or loan the proceeds of any Indebtedness  utilized to refinance the BSN Senior
Subordinated Notes in accordance with subsection 2.4B(ii)(e) and 6.1(xv)(II).


 


6.4          Contingent
Obligations


 


Company
and Borrowers shall not, and shall not permit any of its or their Subsidiaries
to, directly or indirectly, create or become or remain liable with respect to
any Contingent Obligation, except:


 


(i)            Loan Parties may become and remain liable
with respect to Contingent Obligations under their respective Guaranties;


 


(ii)           Company, Borrowers and its and their
Subsidiaries may become and remain liable with respect to Contingent
Obligations in respect of Letters of Credit in an 


 


148





















 


aggregate amount not to
exceed at any time $350,000,000 and Contingent Obligations in respect of other
letters of credit and surety bonds in an aggregate amount not to exceed at any
time $150,000,000;


 


(iii)          Company and its Subsidiaries may become
and remain liable with respect to Contingent Obligations under Hedge Agreements
with respect to Indebtedness;


 


(iv)          Company and its Subsidiaries may become
and remain liable with respect to Contingent Obligations in respect of
customary indemnification and purchase price adjustment obligations incurred in
connection with Asset Sales or other sales of assets;


 


(v)           Company and its Subsidiaries may become
and remain liable with respect to Contingent Obligations under guarantees in
the ordinary course of business of the obligations of suppliers, customers,
franchisees and licensees of Company and its Subsidiaries in an aggregate
amount not to exceed at any time $100,000,000;


 


(vi)          Company and its Subsidiaries may become
and remain liable with respect to Contingent Obligations in respect of any
Indebtedness of Company or any of its Subsidiaries to the extent such
Indebtedness is specifically permitted by subsection 6.1 (other than Existing
Holdings Senior Notes, the BSN Senior Subordinated Notes, Refinancing Senior
Debt, New Junior Debt and except to the extent the obligors for any such
Indebtedness are otherwise specifically restricted by this Agreement);


 


(vii)         Company and its Subsidiaries, as
applicable, may remain liable with respect to Contingent Obligations described
in Schedule 6.4 annexed hereto and any extensions, renewals and
refinancings thereof to the extent that such extensions, renewals and
refinancings thereof do not result in an increase in the aggregate amount of
Contingent Obligations as described in Schedule 6.4;


 


(viii)        Company and its Subsidiaries may become
and remain liable with respect to Contingent Obligations in respect of any
obligation of Company or any of its Subsidiaries not prohibited under this
Agreement (other than any obligation with respect to Indebtedness) (other than
Existing Holdings Senior Notes, the BSN Senior Subordinated Notes, Refinancing
Senior Debt, New Junior Debt and except to the extent the obligors for any such
obligations are specifically restricted by this Agreement);


 


(ix)           Company and Packaging may become and
remain liable on a subordinated basis with respect to Existing Holdings Senior
Notes, Refinancing Senior Debt and New Junior Debt; provided Company and
Packaging may become and remain liable with respect to New Junior Debt on an
unsubordinated basis if such New Junior Debt is unsecured;


 


(x)            BSN and its Subsidiaries remain liable
with respect to Contingent Obligations under the BSN Senior Subordinated Notes
and any Indebtedness refinancing the same permitted under subsection 6.1(xv)(I);
provided that such obligations are subordinated to the French Tranche C1
Term Loans and the French Tranche C2 Term Loans as set forth in the BSN Senior
Subordinated Indentures or otherwise on terms and conditions satisfactory to
Administrative Agent; and


 


149





















 


(xi)           In addition to Contingent Obligations
permitted by the other clauses of this subsection, Company and its Subsidiaries
may become and remain liable with respect to other Contingent Obligations; provided
that the maximum aggregate principal liability, contingent or otherwise, of
Company and its Subsidiaries in respect of all such Contingent Obligations
shall at no time exceed $250,000,000.


 


6.5          Restricted
Junior Payments


 


Company
and Borrowers shall not, and shall not permit any of its and their Subsidiaries
to, directly or indirectly, declare, order, pay, make or set apart any sum for
any Restricted Junior Payment; provided that (A) Company and its
Subsidiaries may (i) make Holdings Ordinary Course Payments to the extent then
due and payable, so long as Holdings applies the amount of any such Restricted
Junior Payment for such purpose; (ii) make Restricted Junior Payments to
Holdings for purchases of Common Stock of Holdings in connection with the
administration of Holdings’ employee benefits program and repurchases of
employee shares; (iii) make regularly scheduled payments of interest in respect
of any Subordinated Indebtedness (including the BSN Senior Subordinated Notes)
in accordance with the terms of, and only to the extent required by, and
subject to the subordination provisions contained in, the indenture or other
agreement pursuant to which such Subordinated Indebtedness was issued, as such
indenture or other agreement may be amended from time to time to the extent not
prohibited by subsection 6.12A; provided, in the case of Company’s
intercompany note to Holdings, such payments of interest shall be limited to
non-cash payments on a basis consistent with past practices and (v) make payments
of intercompany indebtedness other than payments of Company’s intercompany
Indebtedness to Holdings and (B) Company and its Subsidiaries may redeem,
repurchase or otherwise repay the BSN Senior Subordinated Notes with the proceeds
of Indebtedness incurred under subsection 6.1(xv).  The provisions of this subsection 6.5 shall
not be breached by the payment of any Restricted Junior Payments to Holdings
for the purposes of Holdings making a dividend payment under clause (x) of
Holdings Ordinary Course Payments definition within 60 days after the
declaration of the dividend by Holdings, if at such date of declaration, the
making of such payment would not have been in violation of this subsection.


 


6.6          Financial
Covenants


 


A.    Minimum Fixed Charge Coverage Ratio. 
Company and Borrowers shall not permit the Consolidated Fixed Charge
Coverage Ratio for any Fiscal Quarter period ending during any of the periods
set forth below, calculated on a Pro Forma Basis, to be less than the
correlative ratio indicated:


	
  Fiscal Quarter Ending

  	
   

  	
  Minimum Consolidated

  Fixed Charge Coverage

  Ratio

  	
   

  
	
   

  	
   

  
	
  September 30, 2004

  	
   

  	
  1.15: 1.00

  	
   

  
	
  December 31,
  2004

  	
   

  	
  1.15: 1.00

  	
   

  
	
  March 31, 2005

  	
   

  	
  1.15: 1.00

  	
   

  
	
  June 30, 2005

  	
   

  	
  1.15: 1.00

  	
   

  
	
  September 30,
  2005

  	
   

  	
  1.15: 1.00

  	
   

  



 


150





















 


	
  Fiscal Quarter Ending

  	
   

  	
  Minimum Consolidated

  Fixed Charge Coverage

  Ratio

  	
   

  
	
  December 31,
  2005

  	
   

  	
  1.30: 1.00

  	
   

  
	
  March 31, 2006

  	
   

  	
  1.30: 1.00

  	
   

  
	
  June 30, 2006

  	
   

  	
  1.30: 1.00

  	
   

  
	
  September 30,
  2006

  	
   

  	
  1.30: 1.00

  	
   

  
	
  December 31,
  2006

  	
   

  	
  1.50: 1.00

  	
   

  
	
  March 31, 2007

  	
   

  	
  1.50: 1.00

  	
   

  
	
  June 30, 2007

  	
   

  	
  1.50: 1.00

  	
   

  
	
  September 30,
  2007

  	
   

  	
  1.50: 1.00

  	
   

  
	
  December 31,
  2007

  	
   

  	
  1.70: 1.00

  	
   

  
	
  March 31, 2008

  	
   

  	
  1.70: 1.00

  	
   

  



 


B.    Maximum Leverage Ratio.  Company and
Borrowers shall not permit the Consolidated Leverage Ratio as of the last day
of the Fiscal Quarter ending during any of the periods set forth below,
calculated on a Pro Forma Basis, to exceed the correlative ratio indicated:


 


	
  Fiscal Quarter Ending

  	
   

  	
  Maximum Consolidated

  Leverage Ratio

  	
   

  
	
  September 30, 2004

  	
   

  	
  5.10: 1.00

  	
   

  
	
  December 31,
  2004

  	
   

  	
  5.00: 1.00

  	
   

  
	
  March 31, 2005

  	
   

  	
  5.00: 1.00

  	
   

  
	
  June 30, 2005

  	
   

  	
  5.00: 1.00

  	
   

  
	
  September 30,
  2005

  	
   

  	
  5.00: 1.00

  	
   

  
	
  December 31,
  2005

  	
   

  	
  4.65: 1.00

  	
   

  
	
  March 31, 2006

  	
   

  	
  4.65: 1.00

  	
   

  
	
  June 30, 2006

  	
   

  	
  4.65: 1.00

  	
   

  
	
  September 30,
  2006

  	
   

  	
  4.65: 1.00

  	
   

  
	
  December 31,
  2006

  	
   

  	
  4.30: 1.00

  	
   

  
	
  March 31, 2007

  	
   

  	
  4.30: 1.00

  	
   

  
	
  June 30, 2007

  	
   

  	
  4.30: 1.00

  	
   

  
	
  September 30,
  2007

  	
   

  	
  4.30: 1.00

  	
   

  
	
  December 31,
  2007

  	
   

  	
  3.95: 1.00

  	
   

  
	
  March 31, 2008

  	
   

  	
  3.95: 1.00

  	
   

  



 


6.7          Restriction
on Fundamental
Changes; Asset Sales


 


Company
and Borrowers shall not, and shall not permit any of its and their Subsidiaries
to enter into any transaction of merger or consolidation, or liquidate, wind-up
or dissolve itself (or suffer any liquidation or dissolution), or convey, sell,
lease or sub-lease (as lessor or sublessor), transfer or otherwise dispose of,
in one transaction or a series of 


 


151





















 


transactions, all or any part of its business,
property or assets (including its notes or receivables and Capital Stock of a
Subsidiary, whether newly issued or outstanding), whether now owned or
hereafter acquired, except:


 


(i)            any Subsidiary of Company (other than a
Domestic Borrower, ACI or BSN) may be merged or amalgamated  with or into Company, any Borrower, any
Subsidiary Guarantor or any Offshore Guarantor, or be liquidated, wound up or
dissolved, or all or any part of its business, property or assets may be
conveyed, sold, leased, transferred or otherwise disposed of (including its notes
or receivables and Capital Stock), in one transaction or a series of
transactions, to Company, any Borrower, any Subsidiary Guarantor or any
Offshore Guarantor; provided that, in the case of such a merger,
Company, such Borrower, such Subsidiary Guarantor or such Offshore Guarantor
shall be the continuing or surviving Person;


 


(ii)           Company and its Subsidiaries may sell,
lease, sublease or otherwise dispose of assets in transactions that do not
constitute Asset Sales and sell inventory and other personal and real property
held for resale in the ordinary course of business;


 


(iii)          Company and its Subsidiaries may dispose
of obsolete, worn out or surplus property in the ordinary course of business;


 


(iv)          [reserved];


 


(v)           Company and its Subsidiaries may make Asset
Sales of assets having a fair market value not in excess of $500,000,000 for
any twelve-month period provided that (a) the consideration received for such
assets shall be in an amount at least equal to the fair market value thereof;
and (b) for the period from the Second Restatement Date until the date of
determination Company and its Subsidiaries may not make aggregate Asset Sales
under this clause (v) of assets having an aggregate value of more than
$1,000,000,000; provided that Asset Sales made by Avir and its
Subsidiaries after the Second Restatement Date (other than the sale of Avir’s
plant and related assets in Corsico, Italy) shall not exceed $100,000,000 and
provided, further, that, the Plastics Sale shall not constitute an Asset Sale
for purposes of this subsection 6.7(v);


 


(vi)          in order to resolve disputes that occur
in the ordinary course of business, Company and its Subsidiaries may discount
or otherwise compromise for less than the face value thereof, notes or accounts
receivable in accordance with past practice and Company and Subsidiaries may
sell accounts receivable to the extent that the proceeds of Receivables Sale
Indebtedness are applied as required by subsection 2.4B(ii)(f);


 


(vii)         Company and its Subsidiaries may make
Acquisitions and Investments permitted by subsection 6.3;


 


(viii)        Company or a Subsidiary may sell or
dispose of shares of Capital Stock of any of its Subsidiaries in order to
qualify members of the Governing Body of the Subsidiary if required by
applicable law;


 


152





















 


(ix)           Any Person (other than Holdings, a
Domestic Borrower, ACI or BSN) may be merged or amalgamated with or into
Company or any Subsidiary if the acquisition of the Capital Stock of such
Person by Company or such Subsidiary would not be prohibited pursuant to
subsection 6.3; provided that (a) in the case of Company or a Borrower,
Company or such Borrower shall be the continuing or surviving Person, (b) if a
Subsidiary is not the surviving or continuing Person, the surviving Person
becomes a Subsidiary and complies with the provisions of subsections 5.9 and
5.10 and (c) no Potential Event of Default or Event of Default shall have
occurred or be continuing after giving effect thereto;


 


(x)            Any Subsidiary of Company (other than a
Borrower) may be merged with or into any other Subsidiary of Company (other
than a Borrower) or be liquidated, wound up or dissolved, or all or any part of
its business, property or assets may be conveyed, sold, leased or otherwise
disposed of (including its notes or receivables and Capital Stock), in one
transaction or a series of transactions to any other Subsidiary of Company
(other than a Borrower), so long as, at the time of such event, neither
Subsidiary is a Subsidiary Guarantor or an Offshore Guarantor;


 


(xi)           BSN Glasspack Services may sell accounts
receivable in connection with the BSN Receivables Securitization Facility; and


 


provided, that, notwithstanding any of the foregoing
clauses or anything else in this Agreement to the contrary, (i) no Domestic
Borrower may issue any new Capital Stock to any Person other than to Company or
Packaging, and (ii) neither Company nor Packaging may convey, sell, transfer or
otherwise dispose of any Capital Stock in any Domestic Borrower, other than the
security interest therein pledged to Collateral Agent pursuant to the Pledge
Agreement.


 


6.8          Consolidated
Capital Expenditures


 


Company
and Borrowers shall not, and shall not permit its or their Subsidiaries to,
make or incur Consolidated Capital Expenditures, in any Fiscal Year, in an
aggregate amount in excess of the Maximum Consolidated Capital Expenditures
Amount for such Fiscal Year.


 


6.9          Transactions with Shareholders and Affiliates


 


(i)            Company and Borrowers shall not, and
shall not permit any of its or their Subsidiaries to, directly or indirectly,
enter into or permit to exist any transaction (including the purchase, sale,
lease or exchange of any property or the rendering of any service) with any
holder of 5% or more of any class of equity Securities of Company or Holdings
or with any Affiliate of Company or Holdings or of any such holder, on terms
that are less favorable to Company or that Subsidiary, as the case may be, than
those that might be obtained at the time from Persons who are not such a holder
or Affiliate; provided that the foregoing restriction shall not apply to
(A) any transaction between Company and any of its Subsidiaries or between any
of its Subsidiaries, (B) customary fees paid to members of the Board of
Directors of Company and its Subsidiaries, (C) transactions approved by a
majority of the disinterested members of the Board of Directors or other
similar governing body of Company or the applicable Subsidiary,


 


153





















 


(D) purchases and sales
of goods from retailers and suppliers affiliated with KKR in the ordinary
course of business on terms not materially less favorable than generally
available from such retailers or suppliers, (E) the payment of an annual fee to
KKR for rendering management and consulting services to Company and the
reimbursement of expenses in connection therewith, (F) transactions permitted
under subsection 6.5, (G) the payment by Owens Insurance, Ltd. to Holdings of
insurance settlement amounts received, consistent with past practices or (H)
any transaction between or among Holdings, Company, any Borrower or any other
Subsidiary, subject to the restrictions of subsection 6.9(ii) below.


 


(ii)           Company and Borrowers shall not, and
shall not permit any of its or their Subsidiaries to, directly or indirectly,
enter into or permit to exist any transaction (including the purchase, sale,
lease or exchange or any property or the rendering of any service) between such
Person and Holdings that is not consistent generally with past practices.


 


6.10        Sales and
Lease Backs


 


Company
and Borrowers shall not, and shall not permit any of its or their Subsidiaries
to, directly or indirectly, become or remain liable as lessee or as a guarantor
or other surety with respect to any lease entered into after the date hereof,
whether an Operating Lease or a Capital Lease, of any property (whether real,
personal or mixed), whether now owned or hereafter acquired, (i) that Company
or any of its Subsidiaries has sold or transferred or is to sell or transfer to
any other Person (other than Company or any of its Subsidiaries) or (ii) that
Company or any of its Subsidiaries intends to use for substantially the same
purpose as any other property that has been or is to be sold or transferred by
Company or any of its Subsidiaries to any Person (other than Company or any of
its Subsidiaries) in connection with such lease; provided that Company
and its Subsidiaries may become and remain liable as lessee, guarantor or other
surety with respect to any such lease if and to the extent that Company or any
of its Subsidiaries would be permitted to enter into, and remain liable under,
such lease to the extent that the transaction would be permitted under
subsection 6.1, assuming the sale and lease back transaction constituted
Indebtedness in a principal amount equal to the gross proceeds of the sale.


 


6.11        Conduct of
Business


 


From
and after the Third Restatement Date, Company and Borrowers shall not, and
shall not permit any of its or their Subsidiaries to, fundamentally or
substantively alter the character of its business from that conducted by
Company and its Subsidiaries, taken as a whole, as of the Third Restatement
Date.


 


6.12                        Amendments
of Documents Relating to Restricted Debt Obligations; No Prepayments of Restricted Debt
Obligations


 


A.    Amendments of Documents Relating to Restricted Debt
Obligations.  Company and Borrowers shall not, and shall
not permit Holdings or any of its or their Subsidiaries to, amend or otherwise
change, or consent to any amendment or change to, the terms of any Restricted
Debt Obligations, or make any payment (including making any Restricted Junior
Payment to permit Holdings to make any such payment) consistent with an
amendment thereof or change thereto, if the effect of such amendment or change
is to increase 


 


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the interest rate on such
Restricted Debt Obligations, change (to earlier dates) any dates upon which
payments of principal or interest are due thereon, change any event of default
or condition to an event of default with respect thereto (other than the waiver
of any such default by the holders of such Restricted Debt Obligations, to
eliminate any such event of default or increase any grace period related
thereto), change the redemption, prepayment or defeasance provisions thereof,
change any subordination provisions thereof (or of any guaranty thereof other
than to release such guaranty), or change any collateral therefor (other than
to release such collateral), or if the effect of such amendment or change,
together with all other amendments or changes made, is to increase materially
the obligations of the obligor thereunder or to confer any additional rights on
the holders of such Restricted Debt Obligations (or a trustee or other
representative on their behalf) which would be adverse to Company or Lenders
(as determined by Administrative Agent 
in its reasonable judgment); provided that BSN and the other
applicable parties may amend or otherwise change, or consent to any amendment
or change to the BSN Senior Subordinated Note Indentures, if the effect of such
amendment is to eliminate or otherwise relax and/or eliminate certain
restrictive covenants and events of default contained therein as confirmed by
Administrative Agent.


 


B.    No Prepayments of Restricted Debt Obligations. 
Company and Borrowers shall not make, and shall not permit any of its or
their Subsidiaries to make, any voluntary or optional payment on Restricted
Debt Obligations (or in the case of Existing Holdings Senior Notes maturing in
2005 or 2007, any payment at maturity) or to make any Restricted Junior Payment
to Holdings to permit Holdings to make any voluntary or optional payment on
Restricted Debt Obligations (or in the case of Existing Holdings Senior Notes
maturing in 2005 or 2007, any payment at maturity) except that Company or any
of the Borrowers shall be entitled to redeem, repay, repurchase or defease (or
make a Restricted Junior Payment to Holdings to permit Holdings to redeem, repay,
repurchase or defease) (i) Existing Holdings Senior Notes maturing in 2005 with
Revolving Loans made under the Existing Holdings Senior Notes Redemption
Sublimit or funds reserved to Existing Holdings Senior Notes Collateral
Account, or with the proceeds of Revolving Loans (other than Loans made under
the Existing Holdings Senior Notes Redemption Sublimit), Additional Term Loans
or Refinancing Term Loans in each case to the extent permitted under
subsection 2.5B or, so long as the Reservation Conditions are satisfied,
with Net Debt Securities Proceeds or, with other funds available to Company and
its Subsidiaries to do so (provided, that, any such payments made with such
other funds prior to the final maturity of the Existing Holdings Senior Notes
maturing in 2005 shall not exceed $100,000,000 in the aggregate and shall only
be permitted if, after giving effect to such payment, the Revolving Loan
Commitments exceed the Total Utilization of Revolving Loan Commitments by at
least $250,000,000 and the Consolidated Senior Secured Leverage Ratio in less
than 2.85:1.00), (ii) so long as the outstanding principal amount of the
Existing Holdings Senior Notes due 2005 is $75,000,000 or less, to redeem,
repay, or otherwise repurchase Existing Holdings Senior Notes maturing in 2007
with Revolving Loans made under the Existing Holdings Senior Notes Redemption
Sublimit or funds reserved to Existing Holdings Senior Notes Collateral
Account, or the proceeds of Revolving Loans (other than Loans made under the
Existing Holdings Senior Notes Redemption Sublimit), Additional Term Loans or
Refinancing Term Loans in each case to the extent permitted under
subsection 2.5B, or, so long as the Reservation Conditions are satisfied,
with Net Debt Securities Proceeds or, at maturity thereof only, with other
funds available to Company and its Subsidiaries to do so, and (iii) the BSN
Senior Subordinated Notes with the proceeds of Indebtedness permitted under
subsection


 


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6.1(xv).  In addition, Company and its Subsidiaries may
make consent fee payments in connection with any amendments to the BSN Senior
Subordinated Note Indentures described in subsection 6.12A(ii) above on
prevailing market terms.  So long as the
applicable payment of any Restricted Debt Obligation is permitted by this
subsection 6.12B, the payment of accrued interest, fees, expenses and premiums
in connection therewith may also be made with proceeds of Revolving Loans or
with other funds available to Company and its Subsidiaries to do so.


 


SECTION 7


 


EVENTS OF DEFAULT


 


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


 


7.1          Failure
to Make Payments When Due


 


Failure
to pay any installment of principal of any Loan when due, whether at stated
maturity, by acceleration, by notice of prepayment or otherwise; failure to
make reimbursement with respect to any Letter of Credit when due; or failure to
pay any interest on any Loan or any other amount due under this Agreement
within five days after the date due; or


 


7.2          Default
in Other Agreements


 


A.    Failure of Holdings, any Borrower or any of its or
their Subsidiaries to pay when due any principal or interest on any
Indebtedness (other than Indebtedness referred to in subsection 7.1) or
guaranties of Indebtedness (other than Company’s Guaranty of the Obligations
under Section 9) or amounts due in respect of early termination of Hedge
Agreements in an individual principal amount of $50,000,000 or more or with an
aggregate principal amount of $100,000,000 or more, in each case beyond the end
of any period prior to which the obligee thereunder is prohibited from
accelerating payment thereunder; or


 


B.    Breach or default by Holdings, any Borrower or any of
its or their Subsidiaries with respect to any other term of any evidence of any
Indebtedness (other than Indebtedness referred to in subsection 7.1) or
guaranties of Indebtedness (other than Company’s Guaranty of the Obligations
under Section 9) in an individual principal amount of $50,000,000 or more or with
an aggregate principal amount of $100,000,000 or more (or any loan agreement,
mortgage, indenture or other agreement relating thereto) if the effect of such
failure, default or breach is to cause, or (in the case of a breach or default
with respect to a material term of the applicable Indebtedness or guaranty) to
permit the holder or holders of that Indebtedness or guaranty (or a trustee on
behalf of such holder or holders) then to cause, that Indebtedness or guaranty
to become or be declared due prior to its stated maturity (or the stated
maturity of any underlying obligation, as the case may be); provided
that such failure, default or breach has not been waived by such holder or
holders or trustee on behalf of such holder or holders; or


 


7.3          Breach
of Certain Covenants


 


Failure
of Company or any Borrower to perform or comply with any term or condition
contained in subsections 2.5 or 5.2 or Section 6 of this Agreement; or


 


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7.4          Breach of
Warranty


 


Any representation
or warranty made by any Loan Party in any Loan Document or in any statement or
certificate at any time given by any Loan Party in writing pursuant hereto or
thereto or in connection herewith or therewith shall be false in any material
respect on the date as of which made or deemed made; or


 


7.5          Other Defaults under Agreement or Loan Documents


 


Any
Loan Party shall default in the performance of or compliance with any term
contained in this Agreement or any other Loan Document other than those referred
to above in subsections 7.1, 7.3 or 7.4 and such default shall not have been
remedied or waived within 30 days after receipt of notice from Administrative
Agent or any Lender of such default; or


 


7.6          Involuntary
Bankruptcy;
Appointment of Receiver, Etc.


 


A.    (i)  A court
having jurisdiction in the premises shall enter a decree or order for relief in
respect of Holdings, Company, any Domestic Borrower or any of their respective
Material Subsidiaries or any Offshore Borrower in an involuntary case under the
Bankruptcy Code or any applicable bankruptcy, insolvency or other similar law
now or hereafter in effect (whether in the United States of America, the UK,
Australia, Italy, France or any other jurisdiction), which decree or order is
not stayed; or any other similar relief shall be granted under any applicable
federal or state law; or (ii) an involuntary case is commenced against
Holdings, Company, any Domestic Borrower or any of their respective Material
Subsidiaries or any Offshore Borrower under any applicable bankruptcy,
insolvency or other similar law now or hereafter in effect (whether in the
United States of America, the UK, Australia, Italy, France or any other
jurisdiction, including, in the case of any Loan Party organized under the laws
of France, redressement judiciaire and liquidation judiciaire); or a decree or
order of a court having jurisdiction in the premises for the appointment of a
receiver, liquidator, sequestrator, trustee, custodian, administrator,
administrative receiver or other officer having similar powers over Holdings,
Company, any Domestic Borrower or any of their respective Material Subsidiaries
or any Offshore Borrower, or over all or a substantial part of its property,
shall have been entered (including, in the case of any Loan Party organized
under the laws of France, any conciliateur, administrateur judiciaire,
liquidateur judiciaire or mandataire ad hoc); or the involuntary appointment of
an interim receiver, trustee, administrator, administrative receiver or other
custodian of Holdings, Company, any Domestic Borrower or any of their
respective Material Subsidiaries or any Offshore Borrower for all or a
substantial part of its property; or the issuance of a warrant of attachment,
execution or similar process against any substantial part of the property of
Holdings, Company, any Domestic Borrower or any of their respective Material
Subsidiaries or any Offshore Borrower, and the continuance of any such events
in subpart (ii) for 60 days unless dismissed, bonded or discharged; or


 


7.7          Voluntary
Bankruptcy;
Appointment of Receiver, Etc.


 


Holdings,
Company, any Domestic Borrower or any of their respective Material Subsidiaries
or any Offshore Borrower shall have an order for relief entered with respect to
it or commence a voluntary case under the Bankruptcy Code or any applicable
bankruptcy,


 


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insolvency or other similar law now or hereafter in
effect (whether in the United States of America, the UK, Australia, Italy,
France or any other jurisdiction and including, in the case of any Loan Party
organized under the laws of France, procedure de reglement amiable within the
meaning of Article L. 611-3 of the French Commercial Code, redressement
judiciaire or liquidation judiciaire), or shall consent to the entry of an
order for relief in an involuntary case, or to the conversion of an involuntary
case to a voluntary case, under any such law, or shall consent to or apply for
the appointment of or taking possession by a receiver, trustee, administrator,
administrative receiver or other custodian for all or a substantial part of its
property (including, in the case of any Loan Party organized under the laws of
France, any conciliateur, administrateur judiciaire, liquidateur judiciaire or
mandataire ad hoc); the making by Holdings, Company, any Domestic Borrower or
any of their respective Material Subsidiaries or any Offshore Borrower of any
general assignment for the benefit of creditors (including, in the case of any
Loan Party organized under the laws of France, transactions, accord ou
reglement amiable); or the inability or failure of Holdings, Company, any
Domestic Borrower or any of their respective Material Subsidiaries or any
Offshore Borrower, or the admission by Holdings, Company, any Domestic Borrower
or any of their respective Material Subsidiaries or any Offshore Borrower in
writing of its inability to pay its debts as such debts become due (including,
the case of any Loan Party organized under the laws of France, en etat de
cessation des paiements within the meaning of article L 621-1 of the French
Commercial Code); or the Board of Directors or other governing body of
Holdings, Company, any Domestic Borrower or any of their respective Material
Subsidiaries or any Offshore Borrower (or any committee thereof) adopts any
resolution or otherwise authorizes action to approve any of the foregoing; provided,
however, that no Event of Default shall be deemed to have occurred for
purposes of this subsection 7.7 in the event that any Australian
Subsidiary other than an Australian Offshore Borrower, with the consent of
Administrative Agent (which consent shall not be unreasonably withheld),
commences a voluntary winding up with respect to itself for the purposes of a
solvent reconstruction or amalgamation under Australian law; or


 


7.8          Judgments
and Attachments


 


Any
money judgment, writ or warrant of attachment, or similar process involving
(i) in any individual case an amount in excess of $50,000,000 or
(ii) in the aggregate at any time an amount in excess of $100,000,000 (in
either case not adequately covered by insurance as to which the insurance
company has acknowledged coverage) shall be entered or filed against Holdings,
any Borrower or any of Holdings’ other Material Subsidiaries or any Offshore
Borrower or any of their respective assets and shall remain undischarged,
unvacated, unbonded or unstayed for a period of 60 days or in any event later
than five days prior to the date of any proposed sale thereunder; or


 


7.9          Dissolution


 


Any
order, judgment or decree shall be entered against Holdings, any Borrower or
any of Holdings’ other Material Subsidiaries decreeing the dissolution or split
up of Holdings or that Subsidiary or that Borrower and such order shall remain
undischarged or unstayed for a period in excess of 30 days; or


 


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7.10        Change of Control


 


A Change of Control shall
have occurred; or


 


7.11        Employee
Benefit Plans


 


An ERISA Event shall
occur with respect to a Pension Plan or Multiemployer Plan; or


 


7.12        Invalidity of Guaranties; Failure of
Security


 


At any
time after the execution and delivery thereof, (i) any of the Guaranties for
any reason, other than the satisfaction in full of all Obligations, shall cease
to be in full force and effect (other than in accordance with its terms) in any
material respect or shall be declared to be null and void, (ii) any Collateral
Document shall cease to be in full force and effect (other than by reason of a
release of Collateral thereunder in accordance with the terms hereof or thereof
or any other termination of such Collateral Document in accordance with the
terms hereof or thereof) in any material respect or shall be declared null and
void, or Collateral Agent shall not have or shall cease to have a valid and
perfected First Priority Lien in any Collateral purported to be covered thereby
securing only the obligations purported to be covered thereby, in each case (A)
if such unenforceability, nullity or invalidity (in the aggregate with any
other such unenforceability, nullity or invalidity) relates to Collateral the
value of which exceeds $250,000,000 and (B) such unenforceability, nullity or
invalidity did not arise from the failure of Collateral Agent, Administrative
Agent or any Lender to take any action within its control, or (iii) any Loan
Party shall contest the validity or enforceability of any Loan Document in
writing or deny in writing that it has any further liability, including with
respect to future advances by Lenders, under any Loan Document to which it is a
party; or


 


7.13        Activities
of Holdings; OI General FTS; Harbor Capital Subsidiaries; BSN Financing Co.
S.A. and BSN Glasspack Obligation S.A. and their respective Subsidiaries


 


Holdings
shall engage in any activity other than the ownership of the Capital Stock and
intercompany debt of Company and activities related to the administration of claims
for asbestos-related liabilities, serving as a guarantor of O-I Europe SAS’s
obligations under the BSN Share Purchase Agreement and other activities
constituting substantially the same business conducted by Holdings as of the Third
Restatement Date, or OI General FTS shall engage in any activity other than the
ownership of the Capital Stock and intercompany debt of its Subsidiaries and
other activities constituting substantially the same business conducted by OI
General FTS as of the Third Restatement Date, or any of the Harbor Capital
Subsidiaries shall engage in any activity other than the activities
constituting the same business conducted by such Subsidiaries as of the Third
Restatement Date or acquire any material assets from and after the Third Restatement
Date, or, BSN Financing Co. S.A. or BSN Glasspack Obligation S.A. shall trade
or undertake any commercial activities other than acting as issuer of the BSN
Senior Subordinated Notes (or any Indebtedness incurred to refinance the same
pursuant to subsection 6.1(xv),


 


THEN
(i) upon the occurrence of any Event of Default described in the foregoing
subsection 7.6 or 7.7, (A) each of (x) the unpaid principal amount of
and accrued interest on the


 


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Loans,
(y) the Domestic Overdraft Amount and the Offshore Overdraft Amounts and all
accrued and unpaid interest thereon, and (z) an amount equal to the
maximum amount which may at any time be drawn under all Letters of Credit then
outstanding (whether or not any beneficiary under any Letter of Credit shall
have presented, or shall be entitled at such time to present, the drafts or
other documents required to draw under such Letter of Credit), in each case
outstanding to (or issued for the account of) any Borrower that is subject of a
decree, order, case, proceeding, assignment, admission or other event giving
rise to such Event of Default shall automatically become immediately due and
payable, without presentment, demand, protest or other requirements of any kind,
all of which are hereby expressly waived by each Borrower, and the obligation
of Administrative Agent to honor any overdraft in respect of the Domestic
Overdraft Account, the obligation of any Offshore Overdraft Account Provider to
honor any overdraft in respect of any Offshore Overdraft Account, the
obligation of each Lender to make any Loan, the obligation of Administrative
Agent to issue any Letter of Credit for the account of any Borrower and the
right of any other Lender to issue any Letter of Credit hereunder shall
thereupon automatically terminate and (B) Requisite Lenders (or Administrative
Agent, at the direction or with the consent of Requisite Lenders) may, by
written notice to Borrowers, declare an amount equal to the amounts described
in clauses (x), (y) and (z) above outstanding to or issued for the account of
all other Borrowers (or such of such other Borrowers as Requisite Lenders may
direct) to be, and the same shall forthwith become due and payable, without
presentment, demand, protest or other requirements of any kind, all of which
are hereby expressly waived by each Borrower and (ii) upon the occurrence
of any other Event of Default, Requisite Lenders (or Administrative Agent, at
the direction or with the consent of Requisite Lenders) may, by written notice
to Borrowers, declare an amount equal to the amounts described in clauses (x),
(y) and (z) above with respect to any or all Borrowers to be, and the same
shall forthwith become, due and payable, without (except for such notice) presentment,
demand, protest or other requirements of any kind, all of which are hereby
expressly waived by each Borrower, together with accrued interest thereon, and
the obligation of Administrative Agent to honor any overdraft in respect of the
Domestic Overdraft Account, the obligation of any Offshore Overdraft Account
Provider to honor any overdraft in respect of any Offshore Overdraft Account,
the obligation of each Lender to make any Loan, the obligation of
Administrative Agent to issue any Letter of Credit for the account of any
Borrower and the right of any other Lender to issue any Letter of Credit
hereunder shall thereupon terminate; provided that the foregoing shall
not affect in any way (A) the right of Administrative Agent to cause Revolving
Lenders to make Revolving Loans in order to repay the then outstanding Domestic
Overdraft Amount as provided in (and subject to the conditions set forth in)
subsection 2.1B, (B) the obligations of Revolving Lenders to purchase
from Administrative Agent participations in the Domestic Overdraft Amount as
provided in subsection 2.1B, (C) the obligations of Revolving Lenders
to purchase from Issuing Lenders participations in the unreimbursed amount of
any drawings under any Letters of Credit as provided in subsection 2.8E,
or (D) the obligations of Revolving Lenders to purchase participations in
Offshore Overdraft Amounts as provided in subsection 2.1D.


 


Any
amounts described in clause (z) above, when received by Administrative Agent,
shall be held by Administrative Agent in the L/C Collateral Account, for the
benefit of Lenders, as collateral security for the Obligations of Company and Domestic
Borrowers in respect of all outstanding Letters of Credit, and Company and Domestic
Borrowers hereby (X) grant to Administrative Agent a security interest in all
such amounts, together with any interest accrued thereon and any Investments of
such amounts, as security for such Obligations, (Y)


 


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agree
to execute and deliver to Administrative Agent all such documents and
instruments as may be necessary or, in the opinion of Administrative Agent,
desirable in order to more fully evidence, perfect or protect such security
interest, and (Z) agree that, upon the honoring by any Issuing Lender of any
drawing under a Letter of Credit issued by it, Administrative Agent is
authorized and directed to apply any amounts held as collateral security in
accordance with the terms of this paragraph to reimburse such Issuing Lender
for the amount of such drawing.


 


Notwithstanding
the foregoing, if at any time within 60 days after acceleration of the maturity
of any Loan, Borrowers shall pay all arrears of interest and all payments on
account of principal which shall have become due otherwise than by acceleration
(with interest on principal and, to the extent permitted by law, on overdue
interest, at the rates specified in this Agreement or the Notes) and all Events
of Default and Potential Events of Default (other than non-payment of principal
of and accrued interest on the Loans and the Notes, and payments of amounts
referred to in clause (z) above, in each case which is due and payable solely
by virtue of acceleration) shall be remedied or waived pursuant to
subsection 10.7, then Requisite Lenders by written notice to Borrowers may
rescind and annul the acceleration and its consequences (and upon such written
notice all obligations of each Lender hereunder shall be reinstated, in each
case as in effect immediately prior to such acceleration), and Administrative
Agent shall return to the applicable Loan Party any amounts held by
Administrative Agent pursuant to the immediately preceding paragraph as cash
collateral in the L/C Collateral Account in respect of amounts described in
clause (z) above; but such action shall not affect any subsequent Event of
Default or Potential Event of Default or impair any right consequent thereon.


 


Anything
contained in this Agreement to the contrary notwithstanding, after the
occurrence of an Event of Default and the acceleration of the maturity of any
Loans and the amounts referred to in clauses (y) and (z) above, all
payments relating to such Loans and such amounts shall be made to
Administrative Agent for the account of Lenders and all amounts received by
Administrative Agent which are to be applied to the payment of the Obligations
in respect of such Loans and amounts shall be distributed to Lenders in accordance
with subsection 2.10.


 


SECTION 8


 


AGENTS


 


8.1          Appointments


 


DB is
hereby appointed Administrative Agent hereunder by each Lender and each Lender
hereby authorizes Administrative Agent to act hereunder and under the other
instruments and agreements referred to herein (including without limitation the
Guaranties, the Collateral Documents and the Intercreditor Agreement) as its
agent hereunder and thereunder, and DB agrees to act as such upon the express
conditions contained in this Section 8, the Guaranties, the Collateral
Documents and the Intercreditor Agreement. 
BofA and Scotia Capital are hereby appointed Tranche A1 and B1
Co-Syndication Agents hereunder by each Lender and each of BofA and Scotia
Capital agrees to act as such upon the express conditions contained in this
Section 8.  CGMI and BAS are hereby
appointed Tranche C Syndication Agents hereunder by each Tranche C Lender and
CGMI and BAS agree to act as such upon the express conditions


 


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contained
in this Section 8.  Deutsche Bank AG,
London Branch, is hereby appointed UK Administrative Agent hereunder by each
Lender and each Lender hereby authorizes UK Administrative Agent to act
hereunder and under the other instruments and agreements referred to herein as
its agent hereunder and thereunder, and Deutsche Bank AG, London Branch, agrees
to act as such upon the express conditions contained in this Section 8.  The provisions of this Section 8 are solely
for the benefit of Agents and Lenders, and no Borrower shall have any rights as
a third party beneficiary of any of the provisions hereof (except with respect
to the provisions relating solely to consent rights set forth in
subsection 8.6).  In performing
their functions and duties under this Agreement, Agents shall act solely as
agents of Lenders (except in connection with the exercise of consent rights
pursuant to subsection 10.7A) and do not assume and shall not be deemed to
have assumed any obligation towards or relationship of agency or trust with or
for Company or any of its Subsidiaries. 
None of the Tranche A1 and B1 Co-Syndication Agents, Tranche C Syndication
Agents or any Lenders named as Joint Lead Arrangers or Lead Book Managers
hereunder shall have any duties or any liability under this Agreement to any
Person, other than as Lenders hereunder.


 


8.2          Powers;
General Immunity


 


A.    Duties
Specified.  Each Lender irrevocably
authorizes Administrative Agent to take such action on such Lender’s behalf and
to exercise such powers hereunder and under the other instruments and
agreements referred to herein (including without limitation the Guaranties, the
Collateral Documents and the Intercreditor Agreement) as are specifically
delegated to Administrative Agent by the terms hereof and thereof, together
with such powers as are reasonably incidental thereto.  Administrative Agent shall have only those
duties and responsibilities which are expressly specified in this Agreement,
the Guaranties, the Collateral Documents and the Intercreditor Agreement and
may perform such duties by or through its agents or employees.  Each of the Tranche A1 and B1 Co-Syndication
Agents and the Tranche C Syndication Agents shall have no powers or duties
hereunder except as expressly specified in this Agreement.  The title of “Senior Managing Agents” and “Co-Documentation
Agents” provided to certain Lenders in the introductory paragraph to this
Agreement is honorary only and does not impose any duty or obligation on such
Lenders.  The duties of Agents shall be
mechanical and administrative in nature; Agents shall not have by reason of
this Agreement a fiduciary relationship in respect of any Lender; and nothing
in this Agreement, expressed or implied, is intended to or shall be so
construed as to impose upon Agents any obligations in respect of this Agreement
or the other instruments and agreements referred to herein except as expressly set
forth herein or therein.


 


B.    No
Responsibility for Certain Matters. 
Agents shall not be responsible to any Lender for the execution,
effectiveness, genuineness, validity, enforceability, collectibility or
sufficiency of this Agreement, the Guaranties, the Collateral Documents, the
Intercreditor Agreement or any Notes issued hereunder, or for any
representations, warranties, recitals or statements made herein or therein or
made in any written or oral statement or in any financial or other statements, instruments,
reports, certificates or any other documents in connection herewith or
therewith furnished or made by Administrative Agent to Lenders or by or on
behalf of any Borrower to Administrative Agent or any Lender or be required to
ascertain or inquire as to the performance or observance of any of the terms,
conditions, provisions, covenants or agreements contained herein or therein or
as to the use of the proceeds of the Loans or the use of Letters of


 


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Credit or of the
existence or possible existence of any Event of Default or Potential Event of
Default.  Anything contained in this
Agreement to the contrary notwithstanding, Administrative Agent shall have no
any liability arising from (i) confirmations of the amount of outstanding Loans
or the Letter of Credit Usage or the component amounts thereof or (ii) failure
for any reason whatsoever to deliver a Loan Limitation Notice or notice thereof
to any Lender pursuant to subsection 2.1E(iv) in connection with any
Offshore Revolving Loan requested by any Offshore Borrower hereunder.


 


C.    Exculpatory
Provisions.  Neither Agents nor any
of their respective officers, directors, employees or agents shall be liable to
Lenders for any action taken or omitted hereunder or in connection herewith
(including without limitation any act or omission under the Guaranties, the
Collateral Documents or the Intercreditor Agreement) unless caused by its or
their gross negligence or willful misconduct. 
If Administrative Agent shall request instructions from Lenders with
respect to any act or action (including the failure to take an action) in
connection with this Agreement, or the other instruments and agreements
referred to herein, Administrative Agent shall be entitled to refrain from such
act or taking such action unless and until Administrative Agent, shall have
received instructions from Requisite Lenders. 
Without prejudice to the generality of the foregoing,
(i) Administrative Agent shall be entitled to rely, and shall be fully
protected in relying, upon any communication, instrument or document believed
by it in good faith to be genuine and correct and to have been signed or sent
by the proper person or persons, and shall be entitled to rely and shall be
protected in relying on opinions and judgments of attorneys (who may be
attorneys for Company and its Subsidiaries), accountants, experts and other
professional advisors selected by it; and (ii) no Lender shall have any
right of action whatsoever against Administrative Agent as a result of
Administrative Agent acting or (where so instructed) refraining from acting
under this Agreement or the other instruments and agreements referred to herein
in accordance with the instructions of Requisite Lenders.  Administrative Agent shall be entitled to
refrain from exercising any power, discretion or authority vested in it under
this Agreement or the other instruments and agreements referred to herein
unless and until it has obtained the instructions of Requisite Lenders.


 


D.    Agents
Entitled to Act as Lender.  The
agency hereby created shall in no way impair or affect any of the rights and
powers of, or impose any duties or obligations upon, any Agent in its
individual capacity as a Lender hereunder. 
With respect to its participation in the Loans and Letters of Credit,
each Agent shall have the same rights and powers hereunder as any other Lender
and may exercise the same as though it were not performing the duties and
functions delegated to it hereunder and the term “Lender” or “Lenders” or any
similar term shall, unless the context clearly otherwise indicates, include
each Agent in its individual capacity. 
Each Agent and each of its Affiliates may accept deposits from, lend
money to and generally engage in any kind of banking, trust, financial advisory
or other business with any Borrower or any Affiliate of any Borrower as if it
were not performing the duties specified herein, and may accept fees and other
consideration from any Borrower for services in connection with this Agreement and
otherwise without having to account for the same to Lenders.


 


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8.3                               Representations and Warranties; No
Responsibility for Appraisal of Creditworthiness


 


Each
Lender represents and warrants that it has made its own independent
investigation of the financial condition and affairs of Company and the
Borrowers in connection with the making of the Loans, the extensions of credit
under the Domestic Overdraft Account and the Offshore Overdraft Accounts (in
the case of Administrative Agent and each Lender that is an Offshore Overdraft
Account Provider) and the issuance of Letters of Credit hereunder and such
Lender’s purchasing of participations in such Loans, the Domestic Overdraft
Account, the Offshore Overdraft Accounts or such Letters of Credit and has made
and shall continue to make its own appraisal of the creditworthiness of Company
and the Borrowers.  No Agent shall have
any duty or responsibility either initially or on a continuing basis to make
any such investigation or any such appraisal on behalf of Lenders or to provide
any Lender with any credit or other information with respect thereto whether
coming into its possession before the making of the Loans or the issuance of
the Letters of Credit or any time or times thereafter and no Agent shall have
any further responsibility with respect to the accuracy of or the completeness
of the information provided to Lenders.


 


8.4          Right to
Indemnity


 


Each
Lender severally agrees to indemnify each Agent, proportionately to its Pro
Rata Share as in effect on the date on which indemnification is sought
hereunder, to the extent such Agent shall not have been reimbursed by
Borrowers, for and against any and all liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses (including,
without limitation, counsel fees and disbursements) or disbursements of any
kind or nature whatsoever which may be imposed on, incurred by or asserted
against such Agent in performing its duties hereunder or in any way relating to
or arising out of this Agreement or the other instruments and agreements
referred to herein; provided that no Lender shall be liable for any
portion of such liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements resulting from such Agent’s
gross negligence or willful misconduct. 
If any indemnity furnished to an Agent for any purpose shall, in the
opinion of such Agent, be insufficient or become impaired, such Agent may call
for additional indemnity and cease, or not commence, to do the acts indemnified
against until such additional indemnity is furnished.


 


8.5          Registered Persons Treated as Owners


 


Administrative
Agent may deem and treat the Persons listed as Lenders in the Register as the
owners of the corresponding Loans listed therein for all purposes hereof unless
and until an Assignment and Acceptance effecting the assignment or transfer
thereof shall have been accepted by Administrative Agent and recorded in the
Register as provided in subsection 10.2B(ii).  Any request, authority or consent of any
Person who, at the time of making such request or giving such authority or
consent, is listed in the Register as a Lender shall be conclusive and binding
on any subsequent holder, transferee or assignee of the corresponding Loan.


 


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8.6          Successor Agents and Domestic
Overdraft Account Provider


 


(i)            Administrative Agent or UK
Administrative Agent may resign at any time by giving 30 days’ prior written
notice thereof to Lenders and Borrowers’ Agent, and Administrative Agent or UK
Administrative Agent may be removed at any time with or without cause by an
instrument or concurrent instruments in writing delivered to Borrowers’ Agent
and Administrative Agent and signed by Requisite Lenders.  Upon any such notice of resignation or any
such removal, Requisite Lenders shall have the right, upon five days’ notice to
Company and Borrowers’ Agent, to appoint a successor Administrative Agent or UK
Administrative Agent, as applicable; provided that so long as no Event
of Default shall have occurred and be continuing such appointment shall be
subject to the consent of Borrowers’ Agent, which consent shall not be
unreasonably withheld.  Upon the acceptance
of any appointment as an Administrative Agent or UK Administrative Agent
hereunder by a successor Administrative Agent or UK Administrative Agent, that
successor Administrative Agent or UK Administrative Agent shall thereupon
succeed to and become vested with all the rights, powers, privileges and duties
of the retiring or removed Administrative Agent or UK Administrative Agent as
applicable, and the retiring or removed Administrative Agent or UK
Administrative Agent shall be discharged from its duties and obligations as
Administrative Agent or UK Administrative Agent under this Agreement.  After any retiring or removed Administrative
Agent’s or UK Administrative Agent’s resignation or removal hereunder as
Administrative Agent or UK Administrative Agent, the provisions of this Section
8 shall inure to its benefit as to any actions taken or omitted to be taken by
it while it was Administrative Agent or UK Administrative Agent under this
Agreement.


 


(ii)           Any resignation or removal of
Administrative Agent pursuant to this subsection 8.6 shall also constitute
the resignation or removal of Administrative Agent as the provider of the
Domestic Overdraft Account and as Collateral Agent, and any successor
Administrative Agent appointed pursuant to this subsection 8.6 shall, upon
its acceptance of, and as a condition to, such appointment, become the
successor provider of the Domestic Overdraft Account and Collateral Agent for
all purposes hereunder.  In such event
(a) Domestic Borrowers shall repay in full the Domestic Overdraft Amount and
all other amounts owing to the retiring or removed Administrative Agent under
the Domestic Overdraft Agreement, and (b) Borrowers and the retiring or removed
Administrative Agent shall terminate the Domestic Overdraft Agreement to which
they are a party and Company and the successor Administrative Agent shall enter
into a successor Domestic Overdraft Agreement.


 


8.7                               Intercreditor Agreements, Subsidiary Guaranty
and Collateral Documents


 


Each Lender hereby
authorizes Collateral Agent to enter into the Intercreditor Agreement (including,
without limitation the amendment thereof in the form of Exhibit XVII
attached hereto) on behalf of and for the benefit of that Lender, and agrees to
be bound by the terms of the Intercreditor Agreement.  Each Lender with French Tranche C1 Term Loan
Exposure or French Tranche C2 Term Loan Exposure hereby authorizes Collateral
Agent to enter into the BSN Intercreditor Agreements and any amendments,
replacements or terminations of same necessary or desirable in connection with
any refinancing of the BSN Senior Subordinated Notes on behalf of and for the
benefit of that Lender, and agrees to be bound by the terms of such agreements.  Each Lender hereby authorizes Collateral
Agent to enter into the


 


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Guaranties,
the Intercreditor Agreement, and each Collateral Document, and to take all
action contemplated by the Guaranties, the Intercreditor Agreement, the BSN
Intercreditor Agreements and the Collateral Documents; provided that
Collateral Agent shall not enter into or consent to any amendment,
modification, termination or waiver of any provision contained in the
Intercreditor Agreement without the prior consent of the Requisite
Lenders.  Upon the proposed sale,
transfer or other disposition of any Collateral by Company or any of its
Subsidiaries in accordance with this Agreement for which Company or such
Subsidiary desires to obtain a security interest release from Collateral Agent,
Company or such Subsidiary shall deliver an Officer’s Certificate (x) stating
that the Collateral subject to such disposition is being sold, transferred or
otherwise disposed of in compliance with the terms of this Agreement and (y)
specifying the Collateral being sold, transferred or otherwise disposed of in
the proposed transaction.  Upon the
receipt of such Officer’s Certificate, the Collateral Agent is authorized, at
Borrower’s expense, so long as Collateral Agent has no reason to believe that
the Officer’s Certificate so delivered with respect to such sale is not true
and correct, to execute and deliver such releases of its security interest in
such Collateral which is to be so sold, transferred or disposed of, as may be
reasonably requested by Company or such Subsidiary.  If Requisite Lenders, or if required, all
Lenders, consent to the release or reconveyance of any of the Collateral, the
Collateral Agent is authorized to, at Borrowers’ expense, release, and to
execute and deliver any necessary releases of its security interest in such
Collateral in connection therewith and all such reconveyances or transfers
shall be without recourse to the Collateral Agent or the Lenders and without
representation or warranty of any kind. 
Each Lender agrees that no Lender shall have any right individually to
seek to enforce the Guaranties or to realize upon the security granted by any
Collateral Document, it being understood and agreed that such rights and
remedies may be exercised by Collateral Agent for the benefit of Lenders and
the parties to the Intercreditor Agreement (or the BSN Intercreditor Agreements,
as applicable) upon the terms of the Collateral Documents and the Intercreditor
Agreement (or the BSN Intercreditor Agreements, as applicable).


 


SECTION 9


 


COMPANY GUARANTY


 


9.1          Guaranty


 


Company
hereby irrevocably and unconditionally guaranties the due and punctual payment
of all Obligations of all Borrowers hereunder, all obligations and liabilities
under Interest Rate Agreements by and between Company or any of its
Subsidiaries and Lenders or Affiliates of Lenders (“Interest Rate Obligations”) and all Currency Agreements by and
between Company or any of its Subsidiaries and Lenders or Affiliates of Lenders
(“Currency Obligations”) and any
Other Permitted Credit Exposure, when the same shall become due, whether at
stated maturity, by required payment, declaration, demand or otherwise
(including amounts which would become due but for the operation of the
automatic stay under Section 362(a) of the Bankruptcy Code), and agrees to
pay any and all costs and expenses (including reasonable fees and disbursements
of counsel and allocated costs of internal counsel) incurred by Collateral
Agent, Agents or Lenders or their Affiliates party to such Other Lender
Guarantied Obligations (each, a “Guarantied
Party” and collectively, the “Guarantied
Parties”) in enforcing or preserving any rights under this Guaranty
(all such obligations


 


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collectively,
the “Guarantied Obligations”); provided,
that, in order to enjoy the benefit of the foregoing guaranty any such
Lender or Affiliate thereof party to any such Other Permitted Credit Exposure,
Interest Rate Obligations or Currency Obligations shall execute and deliver to
Collateral Agent, during such time as such Lender is a Lender under this
Agreement, an acknowledgment to the Intercreditor Agreement agreeing to be
bound thereby and acknowledged by Borrowers’ Agent.  Any Lender or Affiliate thereof obtaining the
benefit of the foregoing guaranty with respect to Other Permitted Credit
Exposure, Interest Rate Obligations or Currency Obligations shall remain a
Guarantied Party hereunder with respect to such Other Permitted Credit
Exposure, Interest Rate Obligations or Currency Obligations only for so long as
such Lender remains a Lender under this Agreement.


 


9.2          Waivers


 


A.    Company
agrees that the Guarantied Obligations may be extended or renewed, in whole or
in part, without notice or further assent from it, and that Company will remain
bound upon this Guaranty notwithstanding any extension, renewal or other
alteration of any Guarantied Obligation.


 


B.    Company
waives presentation of, demand of, and protest of any Guarantied Obligation and
also waives notice of protest for nonpayment. 
The obligations of Company under this Guaranty shall not be affected by:


 


(i)            the failure of any Guarantied Party
or any other Person to assert any claim or demand or to enforce any right or
remedy against Company, any Borrower or any Subsidiary under the provisions of
this Agreement, any other Loan Document, any Interest Rate Agreement, any
Currency Agreement or any document relating to Other Permitted Credit Exposure
or any other agreement or otherwise,


 


(ii)           any extension or renewal of any
provision of any thereof,


 


(iii)          any rescission, waiver, amendment or
modification of any of the terms or provisions of this Agreement, any other
Loan Document, any Interest Rate Agreement, any Currency Agreement or any
document relating to Other Permitted Credit Exposure or any instrument or agreement
executed pursuant hereto or thereto,


 


(iv)          the failure to perfect any security
interest in, or the release of, any of the security held by any Guarantied
Party, Collateral Agent, any Agent or any other Person for any of the
Guarantied Obligations, or


 


(v)           the failure of any Guarantied Party
or any other Person to exercise any right or remedy against any Borrower or any
Guarantor of any of the Guarantied Obligations.


 


C.    Company
further agrees that this Guaranty constitutes a guaranty of payment when due
and not of collection and waives any right to require that any resort be had by
any Guarantied Party or any other Person to any of the security held for
payment of any of the Guarantied Obligations or to any balance of any deposit
account or credit on the books of any Guarantied Party or any other Person in
favor of a Borrower or any other Person.


 


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D.    The
obligations of Company under this Section 9 shall not be subject to any
reduction, limitation, impairment or termination for any reason, including,
without limitation, any claim of waiver, release, surrender, alteration or
compromise of any of the Guarantied Obligations, and shall not be subject to
any defense or setoff, counterclaim, recoupment or termination whatsoever by
reason of the invalidity, illegality or unenforceability of any of the
Guarantied Obligations, the discharge of any Borrower or any other guarantor
from any of the Guarantied Obligations in a bankruptcy or similar proceeding,
or otherwise (including due to any expropriation, confiscation, nationalization
or requisition by any Government Authority). 
Without limiting the generality of the foregoing, the obligations of
Company under this Section 9 shall not be discharged or impaired or otherwise
affected by the failure of any Guarantied Party, Collateral Agent, any Agent or
any other Person to assert any claim or demand or to enforce any remedy under
this Agreement, any other Loan Document, any Interest Rate Agreement, any
Currency Agreement or any document relating to Other Permitted Credit Exposure
or any other agreement, by any waiver or modification of any hereof or thereof,
by any default, or any other act or thing or omission or delay to do any other
act or thing which may or might in any manner or to any extent vary the risk of
Company or which would otherwise operate as a discharge of Company as a matter
of law or equity.


 


E.     Company
further agrees that this Guaranty shall continue to be effective or be
reinstated, as the case may be, if at any time payment, or any part thereof, of
principal of, interest on or any other amount with respect to any Guarantied
Obligation is rescinded or must otherwise be restored by any Guarantied Party,
Collateral Agent, any Agent or any other Person upon the bankruptcy or
reorganization of Company, any other Person or otherwise.


 


9.3          Payment


 


Company
further agrees, in furtherance of the foregoing and not in limitation of any
other right which any Guarantied Party, Collateral Agent, any Agent or any other
Person may have at law or in equity against Company by virtue hereof, upon
the failure of any Borrower to pay any of the Guarantied Obligations when and
as the same shall become due, whether by required prepayment, declaration or
otherwise (including amounts which would become due but for the operation of
the automatic stay under Section 362(a) of the Bankruptcy Code), Company
will forthwith pay, or cause to be paid, in cash, to Collateral Agent for the
ratable benefit of Guarantied Parties, an amount equal to the sum of the unpaid
principal amount of such Guarantied Obligations then due as aforesaid, accrued
and unpaid interest on such Guarantied Obligations (including, without
limitation, interest which, but for the filing of a petition in a bankruptcy,
reorganization or other similar proceeding with respect to any Borrower, would
have accrued on such Guarantied Obligations) and all other Guarantied
Obligations then owed to Guarantied Parties as aforesaid.  All such payments shall be applied promptly from
time to time by Collateral Agent:


 


First,
to the payment of the costs and expenses of any collection or other realization
under this Guaranty, including reasonable compensation to Collateral Agent and
its agents and counsel, and all expenses, liabilities and advances made or
incurred by Collateral Agent in connection therewith;


 


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Second,
(i) upon and during the effectiveness of the Intercreditor Agreement, to the
payment of the Guarantied Obligations as provided in Section 3 of the
Intercreditor Agreement and (ii) except as set forth in clause (i), to the
payment of the Guarantied Obligations for the ratable benefit of the holders
thereof; and


 


Third,
after payment in full of all Guarantied Obligations, to the payment to Company,
or its successors or assigns, or to whomsoever may be lawfully entitled to
receive the same or as a court of competent jurisdiction may direct, of any
surplus then remaining from such payments.


 


9.4          Waiver of
Subrogation, Etc.


 


Company
hereby waives any claim, right or remedy, direct or indirect, that it now has
or may hereafter have against any Borrower or any of its other Subsidiaries or
any of its assets in connection with this Section 9 or the performance by
Company of its obligations hereunder, in each case whether such claim, right or
remedy arises in equity, under contract, by statute, under common law or
otherwise and including without limitation (a) any right of subrogation,
reimbursement or indemnification that Company now has or may hereafter have
against any Borrower or Subsidiary thereof, (b) any right to enforce, or to
participate in, any claim, right or remedy that Collateral Agent or any other
Guarantied Party now has or may hereafter have against any Borrower or a Subsidiary
thereof, and (c) any benefit of, and any right to participate in, any
collateral or security now or hereafter held by Collateral Agent or any other
Guarantied Party.  In addition, until the
Guarantied Obligations shall have been paid in full and the Commitments shall
have terminated and all Letters of Credit shall have expired or been cancelled,
Company shall withhold exercise of any right of contribution it may have
against any other guarantor of the Guarantied Obligations as a result of any payment
hereunder.  Company further agrees that,
to the extent the waiver of its rights of subrogation, reimbursement,
indemnification and contribution as set forth herein is found by a court of
competent jurisdiction to be void or voidable for any reason, any such rights
of subrogation, reimbursement or indemnification Company may have against any
Borrower or any of its other Subsidiaries or against any collateral or
security, and any such rights of contribution Guarantor may have against any
such other guarantor, shall be junior and subordinate to any rights Collateral
Agent or any Guarantied Party may have against any Borrower or other guarantor,
to all right, title and interest Collateral Agent or any Guarantied Party may
have in any such collateral or security, and to any right Collateral Agent or
any Guarantied Party may have against such other guarantor.  If any amount shall be paid to Company on
account of any such subrogation, reimbursement, indemnification or contribution
rights at any time when all Guarantied Obligations shall not have been paid in
full, such amount shall be held in trust for Collateral Agent on behalf of
Guarantied Parties and shall forthwith be paid over to Collateral Agent for the
benefit of Guarantied Parties to be credited and applied against the Guarantied
Obligations, whether matured or unmatured, in accordance with the terms hereof.


 


Collateral
Agent has been appointed to act on behalf of Guarantied Parties hereunder by
Lenders for their benefit and, by their acceptance of the benefits hereof, the
holders of any Other Lender Guarantied Obligations.  Except as otherwise provided in the next
succeeding paragraph, Collateral Agent shall be obligated, and shall have the
right hereunder, to make demands, to give notices, to exercise or refrain from
exercising any rights, and to take or


 


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refrain
from taking any action, solely in accordance with this Guaranty and this
Agreement; provided that, except as otherwise provided in the Intercreditor
Agreement, Collateral Agent shall exercise, or refrain from exercising, any
remedies hereunder in accordance with the instructions of Requisite
Lenders.  In furtherance of the foregoing
provisions of this paragraph, each holder of Other Lender Guarantied
Obligations, by its acceptance of the benefits hereof, agrees that it shall
have no right individually to enforce this Section 9, it being understood and
agreed by such holder that all rights and remedies hereunder may be exercised
solely by Collateral Agent for the benefit of the Guarantied Parties in
accordance with the terms of this paragraph and that all decisions of the
Requisite Lenders shall be binding on such holders.


 


Anything
contained in this Guaranty to the contrary notwithstanding, upon and during the
effectiveness of the Intercreditor Agreement no Guarantied Party shall be
entitled to take any action whatsoever to enforce any term or provision of this
Guaranty except through the Collateral Agent in accordance with the terms of
the Intercreditor Agreement.


 


9.5          Termination


 


At
such time as all Obligations have been paid in full and all Commitments have
terminated and all Letters of Credit have expired or have been cancelled, the
provisions of this shall be of no further force and effect as to any Other
Lender Guarantied Obligations guaranteed hereby unless an Event of Default
described in subsection 7.6 or subsection 7.7 shall then be
continuing.


 


9.6          Security


 


The
obligations of Company under this Section 9 are secured pursuant to the Pledge
Agreement and the Security Agreement.


 


SECTION 10


 


MISCELLANEOUS


 


10.1        Representation
of Lenders


 


Each
Lender hereby represents that it will make each Loan hereunder for its own
account in the ordinary course of its business and without a view to distribution
of such Loans within the meaning of the Securities Act or the Exchange Act or
other federal securities laws; provided, however, that, subject
to subsection 10.2, the disposition of the Notes or other evidences of
Indebtedness held by that Lender shall at all times be within its exclusive
control.


 


10.2                        Assignments and Participations in Loans,
Notes and Letters of Credit


 


A.    General.  Each Lender shall, subject to the provisions
of this subsection 10.2, have the right at any time to (i) sell,
assign, transfer or negotiate to any Eligible Assignee, or (ii) sell
participations to any Person in, all or any part of any Loan or Loans made by
it or its Commitments or its Letters of Credit or participations therein or any
other interest herein or in any other Obligations owed to it; provided
that no such assignment or participation shall, without the consent of Company,
require any Borrower to file a registration statement with the Securities


 


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and Exchange Commission
or any foreign securities exchange or apply to qualify such assignment or
participation of the Loans, Letters of Credit or participations therein or the
other Obligations under the securities laws of any state.  No such sale, assignment, transfer or
negotiation of any Term Loan or Term Loan Commitment or participation therein
by a Lender shall require a ratable sale, assignment, transfer or negotiation
of any Revolving Loans or Revolving Loan Commitment of such Lender, and no such
sale, assignment, transfer or negotiation of the Revolving Loans or Revolving
Loan Commitment or participation therein by a Lender shall require a ratable
sale, assignment, transfer or negotiation of any Term Loan or Term Loan
Commitment of such Lender.  However, an
assignment of a Revolving Loan Commitment shall automatically constitute an
assignment of a pro rata portion of the assigning Lender’s Offshore Revolving Loan
Commitments to the assignee and Offshore Revolving Loan Commitments may not be
otherwise assigned.  Prior to the
termination of the Revolving Loan Commitments and Offshore Revolving Loan
Commitments, Revolving Loans may not be assigned without a concurrent
assignment of the Revolving Loan Commitment (in at least the amount of such
assigned Revolving Loan) to the assignee of the Loan.  Except as otherwise provided in this
subsection 10.2, no Lender shall, as between any Borrower and such Lender,
be relieved of any of its obligations hereunder as a result of any sale,
assignment, transfer or negotiation of, or any granting of participations in,
all or any part of the Loans, Commitments, Letters of Credit or participations
therein or the other Obligations owed to such Lender.


 


B.    Assignments.


 


(i)            Amounts and Terms of Assignments.  Each Loan, Commitment, Letter of Credit or
participation therein or other Obligation may (a) be assigned in any
amount (of a constant and not a varying percentage) to another Lender, or to an
Affiliate or Related Fund of the assigning Lender or another Lender, with the
giving of notice to Borrowers’ Agent and Administrative Agent; provided  that,
if such Related Fund is not a Lender, such assignment shall be in an amount not
less than $1,000,000 in the case of a Term Loan and $2,500,000 in the case of a
Revolving Loan Commitment, Letter of Credit or participation therein or other
Obligation or (b) be assigned in an amount (of a constant and not a
varying percentage) of not less than $1,000,000 in the case of a Term Loan and
$2,500,000 in the case of a Revolving Loan Commitment, Letter of Credit or
participation therein or other Obligation (or such lesser amount (X) as shall
constitute the aggregate amount of all Loans, Commitments, Letters of Credit or
participations therein and other Obligations of the assigning Lender or (Y) so
long as, after giving effect to such assignment and any other assignments
concurrently being made to the assignee, such assignee receives not less than
$1,000,000 of Term Loans, or $2,500,000 of Revolving Loans, Commitments, or
other Obligations assigned to it) to any other Eligible Assignee with the
giving of notice to Borrowers’ Agent and Administrative Agent and, if no Event
of Default shall have occurred and be continuing, with the consent of Borrowers’
Agent and Administrative Agent, in the case of an assignment made by a Lender
other than Administrative Agent, or with the consent of Borrowers’ Agent, in
the case of an assignment made by Administrative Agent (which consent of
Borrowers’ Agent and Administrative Agent shall not be unreasonably withheld,
withdrawn, delayed or denied; provided that the inability of an Eligible
Assignee to satisfy the requirements set forth in subsection 2.7C(iv) of
this Agreement, if applicable, shall constitute reasonable grounds for
withholding such consent); and provided  further, however,
that


 


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any assignment in accordance with clause (b) either
after the occurrence and during the continuation of an Event of Default or if
required by applicable law shall not require the consent of the Borrowers’
Agent or the Company.  To the extent of
any such assignment in accordance with either clause (a) or (b) above, the
assigning Lender shall be relieved of its obligations with respect to its
Loans, Commitments, Letters of Credit or participations therein or other
Obligations or the portion thereof so assigned. 
The parties to each such assignment shall execute and deliver to
Administrative Agent, for its acceptance and recording in the Register, an Assignment
and Acceptance, together with, with respect to assignments which occur
following the Third Restatement Date, a processing and recordation fee of
$3,500 payable to Administrative Agent (except in the case of an assignment in
which an affiliate of CGMI is assignor or assignee) and such certificates,
documents or other evidence, if any, with respect to United States federal
income tax withholding and foreign tax withholding matters as the assignee
under such Assignment and Acceptance may be required to deliver to
Administrative Agent pursuant to subsection 2.7C(iv).  Upon such execution, delivery and acceptance,
from and after the effective date specified in such Assignment and Acceptance,
(y) the assignee thereunder shall be a party hereto and a “Lender”
hereunder to the extent of the portion of any such Obligation or Commitment so
assigned hereunder and, to the extent that rights and obligations hereunder
have been assigned to it pursuant to such Assignment and Acceptance, shall have
the rights and obligations of a Lender hereunder, including, without
limitation, the obligation in subsection 10.20 to maintain the
confidentiality of all non-public information received by it pursuant to this
Agreement and (z) the assigning Lender thereunder shall, to the extent
that rights and obligations hereunder have been assigned by it pursuant to such
Assignment and Acceptance, relinquish its rights and be released from its
obligations (except as otherwise provided in subsection 10.11) under this
Agreement (and, in the case of an Assignment and Acceptance covering all or the
remaining portion of an assigning Lender’s rights and obligations under this
Agreement, such assigning Lender shall cease to be a party hereto); provided
that, if the assignee of the assigning Lender is an Affiliate of such Lender,
such assignee shall not be entitled to receive any greater amount pursuant to
subsections 2.6E or 2.7 than the assigning Lender would have been entitled
to receive in respect of the amount of the assignment effected by such
assigning Lender to such Affiliate had no such assignment occurred.  The Commitments hereunder shall be modified
to reflect the Commitments of such assignee and any remaining Commitments of
such assigning Lender and, if any such assignment occurs after the issuance of
a Note to the assigning Lender hereunder, if requested pursuant to
subsection 2.1G(iv), new Notes shall, upon surrender of the assigning
Lender’s Note, be issued upon request to the assignee and to the assigning
Lender, substantially in the form of Exhibit IV-A, Exhibit IV-B, Exhibit
IV-C1, Exhibit IV-C2, Exhibit V, or Exhibit VI annexed
hereto, as the case may be, with appropriate insertions, to reflect the new
Commitments and/or outstanding Loans, as the case may be, of the assignee and
the assigning Lender.


 


(ii)           Acceptance by Administrative
Agent; Recordation in Register. 
Subject to the requirements of subsection 10.2A and 10.2B(i), upon
its receipt of an Assignment and Acceptance executed by an assigning Lender and
an assignee representing that it is an Eligible Assignee, together with the
processing and recordation fee referred to in subsection 10.2B(i) and any
certificates, documents or other evidence


 


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with respect to United States federal income tax
withholding and foreign tax withholding matters that such assignee may be
required to deliver to Administrative Agent pursuant to subsection 2.7C(iv),
Administrative Agent shall, if such Assignment and Acceptance has been
completed and is in substantially the form of Exhibit X hereto and if
Administrative Agent and Company have consented to the assignment evidenced
thereby (in each case to the extent such consent is required pursuant to
subsection 10.2B(i)), (a) accept such Assignment and Acceptance by
executing a counterpart thereof as provided therein (which acceptance shall
evidence any required consent of Administrative Agent to such assignment),
(b) record the information contained therein in the Register, and
(c) give prompt notice thereof to Company. 
Administrative Agent shall maintain a copy of each Assignment and
Acceptance delivered to and accepted by it as provided in this subsection 10.2B(ii).


 


C.    Participations.  The holder of any participation, other than
an Affiliate of the Lender granting such participation, shall not be entitled
to require such Lender to take or omit to take any action hereunder except
action directly affecting (i) the extension of the regularly scheduled
maturity of any portion of the principal amount of or interest on any Loan
allocated to such participation; and (ii) a reduction of the principal
amount of or the rate of interest payable on any Loan or payments due in
repayment of draws under Letters of Credit allocated to such participation and
all amounts payable by each Borrower hereunder shall be determined as if such
Lender had not sold such participation. 
A Lender which has sold a participation in its Loans or Commitments
shall require the holder of such participation to agree in writing to comply with
the provisions of subsection 10.20 and if a Lender desires to give any
prospective participant a copy of any non-public information obtained by
Lenders pursuant to the requirements of this Agreement which has been
identified as such by any Borrower, such Lender shall require such prospective participant
to agree to hold such information in accordance with such prospective
participant’s customary procedures for handling confidential information of
this nature and in accordance with safe and sound banking practices prior to
its delivery of such material to such prospective participant.  Each Borrower hereby acknowledges and agrees
that, only for purposes of subsections 2.6E, 2.7, 10.5 and 10.6, any
participation will give rise to a direct obligation of such Borrower to the
participant and the participant shall be considered to be a “Lender”; provided
that no participant shall be entitled to receive any greater amount pursuant to
subsections 2.6E or 2.7 than the transferor Lender would have been entitled to
receive in respect of the amount of the participation effected by such
transferor Lender to such participant had no such participation occurred,
unless such participation resulted from the CAM Exchange.


 


D.    Assignments
to Federal Reserve Banks.  In
addition to the assignments and participations permitted under the foregoing
provisions of this subsection 10.2, any Lender may assign and pledge all
or any portion of its Loans, the other Obligations owed to such Lender, and its
Notes to any Federal Reserve Bank as collateral security pursuant to Regulation A
of the Board of Governors of the Federal Reserve System and any operating
circular issued by such Federal Reserve Bank; and any Lender that is a fund
that invests in bank loans may without the consent of or notice to the
Administrative Agent or any Borrower, pledge all or any portion of its rights
under this Agreement and the other Loan Documents (including, without
limitation, the Notes held by it) to any trustee for, or any other
representative of, holders of obligations owed, or securities issued, by such
fund, as security for such obligations or securities; provided that any
foreclosure or similar action by such trustee shall be subject to the
provisions of this


 


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subsection concerning
assignments; provided that (i) no Lender shall, as between any
Borrower, and such Lender, be relieved of any of its obligations hereunder as a
result of any such assignment and pledge and (ii) in no event shall such
Federal Reserve Bank be considered to be a “Lender” or be entitled to require
the assigning Lender to take or omit to take any action hereunder.


 


E.     Successor
Offshore Overdraft Providers.  Any
Offshore Overdraft Account Provider may resign at any time by giving 30 days’
prior written notice thereof to the Lenders, the relevant Offshore Borrower and
Administrative Agent.  Upon (i) any such
notice of resignation, upon five days notice to Lenders and Administrative
Agent, or (ii) an assignment by such Offshore Overdraft Account Provider of all
of its Offshore Revolving Loan Commitment, such Offshore Borrower shall have
the right to appoint a Lender with respect to Offshore Revolving Loans as
successor Offshore Overdraft Account Provider with respect to the applicable Borrower;
provided that such appointment shall be subject to the consent of
Agents, which consent shall not be unreasonably withheld.  Upon the acceptance of any such appointment
as an Offshore Overdraft Account Provider hereunder by a successor Offshore Overdraft
Account Provider, the relevant Offshore Borrower shall repay in full the
relevant Offshore Overdraft Amount and all other amounts owing to the resigning
Offshore Overdraft Account Provider under the relevant Offshore Overdraft
Agreement, and such Borrower and the resigning Offshore Overdraft Account
Provider shall terminate such Offshore Overdraft Agreement and the successor
Offshore Overdraft Account Provider shall enter into a successor Offshore
Overdraft Agreement.


 


F.     Information.  Each Lender may furnish any information
concerning Company and its Subsidiaries in the possession of that Lender from
time to time to assignees and participants (including prospective assignees and
participants), subject to subsection 10.20.


 


G.    Replacement
of Post-Restatement Date Lender.  At
any time the Moody’s rating or the S&P rating for any Post-Restatement Date
Lender (as defined below) is lower than Baa3 or BBB-, respectively:


 


(i)            if Company’s long term unsecured
debt rating is Ba2 or higher from Moody’s and BB or higher from S&P, then
Company may (but shall not be obligated to) obtain a commitment from another
Lender or Lenders or an Eligible Assignee or Eligible Assignees to become a Revolving
Lender or Revolving Lenders for all purposes under this Agreement (in the case
of any such Eligible Assignee) and to assume the Revolving Loan Commitments
(and related Offshore Revolving Loan Commitments of such Post-Restatement Date
Lender) hereunder; and


 


(ii)           if Company’s long term unsecured debt
rating is lower than Ba2 from Moody’s or lower than BB from S&P, and
Requisite Lenders have elected to replace such Post-Restatement Date Lender,
then Requisite Lenders or Company (with the consent of Requisite Lenders) may
obtain a commitment from another Lender or Lenders or an Eligible Assignee or
Eligible Assignees to become a Revolving Lender or Revolving Lenders for all
purposes under this Agreement (in the case of any such Eligible Assignee) and
to assume the Revolving Loan Commitments (and related


 


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Offshore Revolving Loan Commitments) of such
Post-Restatement Date Lender hereunder.


 


In the event the commitment referred to in clause (i)
or (ii) above to assume the Revolving Loan Commitments (and related Offshore
Revolving Loan Commitments) of the relevant Post-Restatement Date Lender is
obtained in accordance with such clause, the relevant Post-Restatement Date
Lender (1) shall assign all of its Revolving Loans, Revolving Loan Commitments,
Offshore Revolving Loans and Offshore Revolving Loan Commitments and its other
obligations to such other Lender or Lenders or Eligible Assignee or Eligible
Assignees, at par, pursuant to the provisions of subsection 10.2B; provided
that, such replacement shall not be effective until (x) the applicable
Borrower has paid or caused to be paid to such Post-Restatement Date Lender all
principal, interest, fees and other amounts then due and owing to such
Post-Restatement Date Lender hereunder through such date of replacement
(including any amounts payable under subsection 2.6B) (and each Borrower
hereby agrees to pay such amounts with respect to the relevant Loans,
Commitments and other Obligations), (y) Company has paid to Administrative
Agent the processing and recordation fee required to be paid by
subsection 10.2B(i) (and
Company hereby agrees to pay such amounts), and (z) all of the
requirements for such assignment contained in subsection 10.2B, including,
without limitation, the receipt by Administrative Agent of an executed
Assignment and Acceptance and other supporting documents, have been fulfilled,
and (2) shall be obligated to use its best efforts to cause the foregoing
replacement to occur.  For purposes of
this subsection 10.2G, “Post-Restatement Date
Lender” means any Revolving Lender which is neither a Lender on the Third
Restatement Date nor an Affiliate of any Lender party to this Agreement on the Third
Restatement Date.


 


10.3        Expenses


 


Each
Domestic Borrower jointly and severally agrees to promptly pay (i) all the
actual and reasonable costs and expenses of preparation of this Agreement and
the other Loan Documents and all the costs of furnishing all opinions by
counsel for the Loan Parties (including without limitation any opinions
requested by Lenders as to any legal matters arising hereunder), and of each
Loan Party’s performance of and compliance with all agreements and conditions
contained herein on their part to be performed or complied with; (ii) the
reasonable fees, expenses and disbursements of counsel to Agents (including
allocated costs of internal counsel) in connection with the negotiation,
preparation, execution and administration of this Agreement, the other Loan
Documents, the Letters of Credit and the Loans hereunder, and any amendments
and waivers hereto or thereto; and (iii) after the occurrence of an Event
of Default, all costs and expenses (including reasonable attorneys’ fees,
including allocated costs of internal counsel, and costs of settlement)
incurred by any Agent or Lender in enforcing any Obligations of or in
collecting any payments due from any Borrower hereunder or under the Notes or
any of the other Loan Documents by reason of such Event of Default or in
connection with any refinancing or restructuring of the credit arrangements
provided under this Agreement in the nature of a “work-out” or of any
insolvency or bankruptcy proceedings.


 


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10.4        Indemnity


 


In
addition to the payment of expenses pursuant to subsection 10.3, each
Domestic Borrower jointly and severally agrees to indemnify, pay and hold
Agents and Lenders and the officers, directors, employees, agents, trustees and
affiliates of Agents and Lenders (collectively called the “Indemnitees”)
harmless from and against, any and all other liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, claims, costs, expenses and
disbursements of any kind or nature whatsoever (including, without limitation,
the reasonable fees and disbursements of counsel for such Indemnitees in
connection with any investigative, administrative or judicial proceeding
commenced or threatened, whether or not such Indemnitee shall be designated a
party thereto), which may be imposed on, incurred by, or asserted against that
Indemnitee, in any manner relating to or arising out of this Agreement or the
other Loan Documents, Lenders’ agreement to make the Loans or the use or
intended use of the proceeds of the Loans or the issuance of Letters of Credit
hereunder and Lenders’ agreement to purchase participations therein as provided
for herein or the use or intended use of the Letters of Credit or the honoring
of overdrafts under the Domestic Overdraft Agreement or the purchase of
participations by Lenders in the Domestic Overdraft Amount or in the Offshore
Overdraft Amounts (the “indemnified liabilities”);
provided that no Domestic Borrower shall have any obligation to an
Indemnitee hereunder with respect to indemnified liabilities arising from the
gross negligence or willful misconduct of that Indemnitee.  Each Domestic Borrower, jointly and
severally, also agrees to indemnify and hold harmless the Indemnitees from any
claim, demand or liability for broker’s or finder’s fees alleged to have been
incurred in connection with any transactions contemplated by this Agreement and
any expenses, including reasonable legal fees, arising in connection with any
such claim, demand or liability.  To the
extent that the undertaking to indemnify, pay and hold harmless set forth in
the preceding sentence may be unenforceable because it is violative of any law
or public policy, each Domestic Borrower shall contribute the maximum portion
which it is permitted to pay and satisfy under applicable law, to the payment
and satisfaction of all indemnified liabilities incurred by the Indemnitees or
any of them.


 


10.5        Set Off


 


For so
long as any of the Obligations are secured by one or more Real Property Assets
located in the State of California, each Lender agrees not to charge or offset
any amount owed to it by any Loan Party against any of the accounts, property
or assets of any Loan Party without the prior written consent of Collateral
Agent.  Subject to the foregoing
sentence, in addition to any rights now or hereafter granted under applicable
law and not by way of limitation of any such rights, but in all cases subject
to subsection 10.6, upon the occurrence and during the continuance of any
Event of Default, each Lender is hereby authorized by Company and each Borrower
at any time or from time to time, without notice to Company or such Borrower,
or to any other Person, any such notice being hereby expressly waived, to set
off and to appropriate and to apply any and all deposits (general or special,
including, but not limited to, Indebtedness evidenced by certificates of
deposit, whether matured or unmatured but not including trust accounts and in
whatever currency denominated) and any other Indebtedness at any time held or
owing by that Lender or any Affiliate thereof to or for the credit or the
account of Company or such Borrower against and on account of the obligations
and liabilities of Company or such Borrower to that Lender under this
Agreement, the Notes, the Domestic Overdraft Agreement,


 


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the
Offshore Overdraft Agreements and the Letters of Credit, including, but not limited
to, all claims of any nature or description arising out of or connected with
this Agreement, the Letters of Credit or the Notes or the other Loan Documents,
irrespective of whether or not (a) that Lender shall have made any demand
hereunder or (b) that Lender shall have declared the principal of and the
interest on the Loans and Notes, any obligations of Company or such Borrower in
respect of the Letters of Credit and other amounts due hereunder to be due and
payable as permitted by Section 7 and although said obligations and
liabilities, or any of them, may be contingent or unmatured.


 


10.6        Ratable Sharing


 


Lenders
hereby agree among themselves that if any of them shall, through the exercise
of any right of counterclaim, setoff, banker’s lien or otherwise (other than a
voluntary prepayment of Loans, a mandatory prepayment of Loans, a scheduled
repayment of Loans, a payment made under Section 2.10, in each case made and
applied in accordance with this Agreement) or as adequate protection of a
deposit treated as cash collateral under the Bankruptcy Code, receive payment
or reduction of a proportion of the aggregate amount of principal and interest
then due with respect to the Loans owed to that Lender, the amount then due to
that Lender with respect to the Domestic Overdraft Amount or any Offshore
Overdraft Amount or any Letter of Credit or Offshore Revolving Loan or any
participation therein, or any fees or commissions payable hereunder or under
the other Loan Documents (collectively, the “Aggregate
Amounts Due” to such Lender) which is greater than the proportion
received by any other Lender in respect to the Aggregate Amounts Due to such
other Lender, then the Lender receiving such proportionately greater payment
shall (y) notify each other Lender and Administrative Agent of such
receipt and (z) purchase participations (which it shall be deemed to have
done simultaneously upon the receipt of such payment) in the Aggregate
Amounts Due to the other Lenders so that all such recoveries of Aggregate
Amounts Due shall be shared by the Lenders in proportion to the Aggregate
Amounts Due them; provided that if all or part of such proportionately
greater payment received by such purchasing Lender is thereafter recovered from
such Lender, those purchases shall be rescinded and the purchase prices paid
for such participations shall be returned to that Lender to the extent of such
recovery, but without interest.  Company
and each Borrower expressly consent to the foregoing arrangement and agrees
that any holder of a participation so purchased and any other subsequent holder
of a participation in any Loan or Letter of Credit or the Domestic Overdraft
Amount or any Offshore Overdraft Amount otherwise acquired may exercise any and
all rights of banker’s lien, setoff or counterclaim with respect to any and all
monies owing by Company or such Borrower to that holder as fully as if that
holder were a holder of such a Loan or Letter of Credit or the Domestic
Overdraft Amount or any Offshore Overdraft Amount in the amount of the participation
held by that holder.


 


10.7        Amendments
and Waivers


 


A.    Except
as set forth in subsections 2.1A(iv), no amendment, modification, termination
or waiver of any provision of this Agreement or of the Notes, and no consent to
any departure by Company or any Borrower therefrom, shall in any event be
effective without the written concurrence of Requisite Lenders; provided
that no such amendment, modification, termination, waiver or consent shall,
without the consent of each Lender (with Obligations directly affected in the
case of the following clause (i)): 
(i) extend the scheduled final maturity


 


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of any Loan or Note
beyond the Tranche A1 Term Loan Maturity Date, the Tranche B1 Term Loan
Maturity Date or the Revolving Loan Commitment Termination Date, as the case
may be, or extend the stated expiration date of any Letter of Credit beyond the
Revolving Loan Commitment Termination Date or the date for reimbursement of any
amount drawn thereunder beyond the Revolving Loan Commitment Termination Date,
or reduce the rate of interest (other than any waiver of any increase in the
interest rate applicable to any of the Loans pursuant to subsection 2.2E)
or fees in respect of the Revolving Loan Commitments, the Loans or the Letters
of Credit, or extend or waive the time of payment of interest or fees in
respect thereof, or reduce or forgive the principal amount of any of the
Obligations (including any Obligation to reimburse the amount of any drawing
honored under any Letter of Credit), (ii) amend, modify, terminate or
waive any provision of this subsection 10.7 or any other provision of this
Agreement expressly requiring the approval or concurrence of all Lenders,
(iii) reduce the percentage specified in the definition of Requisite
Lenders or change the definitions of “Pro
Rata Share” (it being understood that, with respect to the
Additional Term Loans and, with the consent of Requisite Lenders (determined
before giving effect to the proposed action), with respect to other
Indebtedness, additional extensions of credit pursuant to this Agreement may be
included in determining what constitutes Requisite Lenders and in determining
the Pro Rata Shares of Lenders, in each case on substantially the same basis as
the Revolving Loan Commitments and the Revolving Loans or the Term Loan
Commitments and the Term Loans are included in such determinations on the First
Restatement Date), (iv) release Company from the Company Guaranty, (v) release
all or substantially all of the Collateral or (vi) permit any Interest Period
for any Eurodollar Rate Loan to exceed nine months; provided, further,
that no such amendment, modification, termination, waiver or consent shall (1)
increase the Term Loan Commitment or the Revolving Loan Commitment of any
Lender over the amount thereof then in effect without the consent of such
Lender (it being understood that (A) amendments, modifications or waivers of
conditions precedent, covenants, Potential Events of Default or Events of
Default, mandatory reductions in the Revolving Loan Commitments or of mandatory
prepayments of Term Loans or Revolving Loans, shall not constitute an increase
of the Term Loan Commitment or the Revolving Loan Commitment of any Lender and
(B) an increase in the available portion of the Revolving Loan Commitment of
any Lender shall not constitute an increase in the Revolving Loan Commitment of
such Lender); (2) amend, modify, terminate or waive any provision of
subsection 2.1B or any other provision of this Agreement relating to the
Domestic Overdraft Account or the Domestic Overdraft Amount (including any
provision relating to the repayment of the Domestic Overdraft Amount with the
proceeds of Revolving Loans or relating to the obligations of Lenders to
purchase participations in the Domestic Overdraft Amount) without the consent
of Administrative Agent; (3) amend, modify, terminate or waive any
provision of this Agreement relating to the obligations of Lenders to purchase
participations in Letters of Credit without the written concurrence of
Administrative Agent and each other Issuing Lender which has a Letter of Credit
then outstanding or which has not been reimbursed for a drawing under a Letter
of Credit issued by it; or (4) amend, modify, terminate or waive any
provision of Section 8 applicable to any Agent without the consent of such
Agent.  In addition, no amendment,
modification, termination or waiver of (a) any provision of subsection 2.4 that
has the effect of changing any interim scheduled payments, voluntary or
mandatory prepayments, or Commitment reductions applicable to a Class in a
manner that disproportionately disadvantages such Class relative to any other Class
shall be effective without the written concurrence of Requisite Class Lenders
of such affected Class (it being understood and agreed that any amendment,


 


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modification, termination
or waiver of any such provision which postpones or reduces any interim
scheduled payment, voluntary or mandatory prepayment, or Commitment reduction
from those set forth in subsection 2.4 with respect to one Class but not any
other Class shall be deemed to disproportionately disadvantage such one Class
but not to disproportionately disadvantage any such other Class for purposes of
this sentence) and (b) any provision of subsection 2.10 that disproportionately
disadvantages any Class relative to any other Class shall be effective with out
the written concurrence of Requisite Class Lenders of such disproportionately
disadvantaged Class.


 


B.    If, in connection with any proposed amendment, modification,
termination, waiver or consent relating to any of the provisions of this Agreement
or the Notes as described in any of clauses (i) through (vi) of the first
proviso to subsection 10.7A the consent of Requisite Lenders is obtained
but the consent of one or more of the other Lenders whose consent is also
required is not obtained, then Company shall have the right, so long as all
such non-consenting Lenders whose individual consent is required are treated as
described in either clause (i) or (ii) below, to (i) replace each such
non-consenting Lender with one or more Replacement Lenders (as defined in
subsection 10.7C) pursuant to subsection 10.7C so long as at the time
of such replacement each such Replacement Lender consents to the proposed
amendment, modification, termination, waiver or consent and/or (ii) terminate
each such non-consenting Lender’s Commitments and repay in full its outstanding
Loans, together with accrued and unpaid interest, fees and other amounts owing
to such Lender, in accordance with subsection 2.4B(i); provided
that unless the Commitments that are terminated and the Loans that are repaid
pursuant to the preceding clause (ii) are immediately replaced in full at such
time through the addition of new Lenders or the increase of the Commitments
and/or outstanding Loans of existing Lenders (who in each case must specifically
consent thereto), then in the case of any action pursuant to the preceding
clause (ii), Requisite Lenders (determined before giving effect to the proposed
action) shall specifically consent thereto; provided  further that
Company shall not have the right to terminate any such non-consenting Lender’s
Commitments and repay in full its outstanding Loans pursuant to clause (ii) of
this subsection 10.7B if, immediately after the termination of such
Lender’s Revolving Loan Commitment, the Total Utilization of Revolving Loan
Commitments would exceed the Revolving Loan Commitments then in effect; provided
still  further that Company shall not have the right to replace a
Lender solely as a result of the exercise of such Lender’s rights (and the
withholding of any required consent by such Lender) pursuant to the “provided,
further” clause in subsection 10.7A.


 


C.    (i)  In
the event of certain refusals by any Lender, as provided in
subsection 10.7B, to consent to certain proposed amendments,
modifications, terminations, waivers or consents with respect to this Agreement
which have been approved by Requisite Lenders, Borrowers may, so long as no
Potential Event of Default or Event of Default exists, upon five Business Days’
written notice to Administrative Agent (which notice Administrative Agent shall
promptly transmit to each Lender) repay all Loans, together with accrued and
unpaid interest, fees and other amounts owing to such Lender (a “Replaced Lender”) in accordance with, and
subject to the requirements of, subsection 10.7B so long as (i) in the
case of the repayment of Loans of any Lender pursuant to this
subsection 10.7C, the Commitments of such Lender are terminated
concurrently with such repayment (at which time Schedule A shall be
deemed modified to reflect the changed Commitments) and (ii) in the case of the
repayment of


 


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Loans of any Lender the
consents required by Section 10.7B in connection with the repayment
pursuant to this subsection 10.7C have been obtained.


 


(ii)           At the time of any replacement
pursuant to this subsection 10.7C, the lender replacing such Replaced
Lender (the “Replacement Lender”)
shall enter into one or more assignment agreements, in form and substance
satisfactory to Administrative Agent, pursuant to which the Replacement Lender
shall acquire the Commitments and outstanding Loans of, and participations in
the Domestic Overdraft Amount and Letters of Credit by, the Replaced Lender
and, in connection therewith, shall pay to (x) the Replaced Lender in respect
thereof an amount equal to the sum of (A) an amount equal to the principal of,
and all accrued interest on, all outstanding Loans of the Replaced Lender, (B)
an amount equal to all unpaid drawings with respect to Letters of Credit that
have been funded by (and not reimbursed to) such Replaced Lender, together with
all then unpaid interest with respect thereto at such time, and (C) an amount
equal to all accrued, but theretofore unpaid, fees owing to the Replaced Lender
and (y) the appropriate Issuing Lender an amount equal to such Replaced
Lender’s Pro Rata Share of any unpaid drawing with respect to Letters of Credit
(which at such time remains an unpaid drawing), to the extent such amount was
not theretofore funded by such Replaced Lender;


 


(iii)          All obligations of any Borrower owing
to the Replaced Lender (excluding those specifically described in clause (ii)
above in respect of which the assignment purchase price has been, or is
concurrently being, paid, but including, however, any amounts that would have
been payable by a Borrower pursuant to subsection 2.6E if such Borrower
had directly prepaid the Loans of such Replaced Lender) shall be paid in full
by such Borrower to such Replaced Lender concurrently with such replacement; and


 


(iv)          Upon the execution of the respective
assignment documentation, the payment of amounts referred to in clauses (ii)
and (iii) above and, if so requested by the Replacement Lender, delivery to the
Replacement Lender of the appropriate Note or Notes executed by the applicable
Borrowers, the Replacement Lender shall become a Lender hereunder and the
Replaced Lender shall cease to constitute a Lender hereunder, except with
respect to Borrowers’ obligations regarding indemnification provisions under this
Agreement, which shall survive for the benefit of such Replaced Lender.  Notwithstanding anything to the contrary
contained above, no Issuing Lender may be replaced hereunder at any time while
it has Letters of Credit outstanding hereunder unless arrangements satisfactory
to such Issuing Lender (including the furnishing of a standby letter of credit
in form and substance, and issued by an issuer, satisfactory to such Issuing
Lender or the furnishing of cash collateral in amounts and pursuant to
arrangements satisfactory to such Issuing Lender) have been made with respect
to such outstanding Letters of Credit.


 


D.    Administrative Agent may, but shall have no obligation to, with
the concurrence of any Lender, execute amendments, modifications, waivers or
consents on behalf of that Lender.  Any
waiver or consent shall be effective only in the specific instance and for the
specific purpose for which it was given. 
No notice to or demand on Company or any Borrower


 


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in any case shall entitle
Company or any Borrower to any other or further notice or demand in similar or
other circumstances.  Any amendment,
modification, termination, waiver or consent effected in accordance with this
subsection 10.7 shall be binding upon each Lender at the time outstanding,
each future Lender and, if signed by Company or any Borrower, on such Company
and such Borrower.


 


10.7A     Additional Amendment and Waiver
Matters.  In addition to the matters set forth in
Section 10.7, no amendment, modification, termination, waiver or consent shall,
without the consent of each Lender directly affected thereby, extend the final
maturity date of any Tranche C Term Loans beyond the Tranche C Term Loan
Maturity Date or permit an interest period with respect to any Euro LIBOR Loan
to exceed nine months.


 


10.8        Independence
of Covenants


 


All
covenants hereunder shall be given independent effect so that if a particular
action or condition is not permitted by any of such covenants, the fact that it
would be permitted by an exception to, or be otherwise within the limitations
of, another covenant shall not avoid the occurrence of an Event of Default or
Potential Event of Default if such action is taken or condition exists.


 


10.9        Change in
Accounting Principles, Fiscal Year or Tax Laws


 


If
(i) any changes in accounting principles and policies from those used in
the preparation of the financial statements referred to in subsection 4.3
hereafter occasioned by the promulgation of rules, regulations, pronouncements and
opinions by or required by the Financial Accounting Standards Board or the
American Institute of Certified Public Accountants (or successors thereto or
agencies with similar functions) would result in a change in the method of
calculation of financial covenants, standards or terms found in Section 1,
Section 5 and Section 6 hereof (other than changes in such principles and
policies relating to impairment or charge-offs of the value of assets acquired
prior to December 31, 2002, which changes shall be disregarded for purposes of
such calculations), (ii) there is any change in Company’s or Holdings’
Fiscal Quarter or Fiscal Year, or (iii) there is a material change in
federal tax laws which materially affects Company’s ability to comply with the
financial covenants, standards or terms found in Section 1, Section 5 and
Section 6 hereof, the parties hereto agree to enter into negotiations in order
to amend such provisions (in accordance with subsection 10.7) so as to
equitably reflect such changes with the desired result that the criteria for
evaluating Company’s financial condition shall be the same after such changes
as if such changes had not been made.


 


10.10      Notices


 


Unless
otherwise specifically provided herein, any notice or other communication
herein required or permitted to be given shall be in writing and may be
personally served, telecopied, telexed or sent by United States mail or by
courier service and shall be deemed to have been given when delivered in person
or by courier service, by receipt of telecopy or telex or when received through
the United States mail, registered or certified, with postage prepaid and
properly addressed; provided that notices to Administrative Agent or any
Borrower shall not be effective until received. 
For the purposes hereof, the addresses of the parties hereto (until
notice


 


181
















 


of a
change thereof is delivered as provided in this
subsection 10.10) shall be as set forth under each party’s name on
the signature pages hereof or in the applicable Assignment and Acceptance.  All notices to any Borrower provided for
hereunder shall be copied concurrently to Borrowers’ Agent.


 


10.11      Survival of Warranties and Certain
Agreements


 


A.    All agreements, representations and warranties made herein shall
survive the execution and delivery of this Agreement, the making of the Loans
hereunder, the execution and delivery of the Notes and the issuance of the
Letters of Credit.


 


B.    Notwithstanding anything in this Agreement or implied by law to
the contrary, the agreements of Company and each Borrower set forth in
subsections 2.6E, 2.7, 10.3, 10.4 and 10.21 and the agreements of Lenders set
forth in subsections 8.2C, 8.4, 10.5, 10.6 and 10.20 shall survive the payment
of the Loans, the Notes, the Offshore Overdraft Amounts and the Domestic
Overdraft Amount, the cancellation or expiration of the Letters of Credit and
the termination of this Agreement.


 


10.12      Failure or Indulgence Not Waiver;
Remedies Cumulative


 


No
failure or delay on the part of Administrative Agent or any Lender in the
exercise of any power, right or privilege hereunder or under the other Loan
Documents shall impair such power, right or privilege or be construed to be a
waiver of any default or acquiescence therein, nor shall any single or partial
exercise of any such power, right or privilege preclude other or further
exercise thereof or of any other right, power or privilege.  All rights and remedies existing under this
Agreement or the other Loan Documents are cumulative to and not exclusive of,
any rights or remedies otherwise available.


 


10.13      Severability


 


In
case any provision in or obligation under this Agreement or the Notes shall be
invalid, illegal or unenforceable in any jurisdiction, the validity, legality
and enforceability of the remaining provisions or obligations, or of such
provision or obligation in any other jurisdiction, shall not in any way be
affected or impaired thereby.


 


10.14      Obligations Several; Independent
Nature of Lenders’ Rights


 


The
obligation of each Lender hereunder is several, and no Lender shall be
responsible for the obligation or commitment of any other Lender
hereunder.  Nothing contained in this
Agreement and no action taken by Lenders pursuant hereto shall be deemed to
constitute Lenders to be a partnership, an association, a joint venture or any
other kind of entity.  The amounts
payable at any time hereunder to each Lender shall be a separate and
independent debt, and each Lender shall, subject to Section 7, be entitled to
protect and enforce its rights arising out of this Agreement and it shall not
be necessary for any other Lender to be joined as an additional party in any
proceeding for such purpose.


 


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10.15      Headings


 


Section and
subsection headings in this Agreement are included herein for convenience
of reference only and shall not constitute a part of this Agreement for any
other purpose or be given any substantive effect.


 


10.16      Applicable Law


 


THIS
AGREEMENT AND THE NOTES SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND
ENFORCED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK
(INCLUDING WITHOUT LIMITATION SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAW OF
THE STATE OF NEW YORK), WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES.  EACH LETTER OF CREDIT SHALL BE GOVERNED BY,
AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS OR RULES
DESIGNATED IN SUCH LETTER OF CREDIT, OR IF NO SUCH LAWS OR RULES ARE
DESIGNATED, THE UNIFORM CUSTOMS AND PRACTICES FOR DOCUMENTARY CREDITS (1993
REVISION), INTERNATIONAL CHAMBER OF COMMERCE, PUBLICATION NO. 500 OR ANY
SUCCESSOR PUBLICATIONS (THE “UNIFORM CUSTOMS”) AND, AS TO MATTERS NOT
GOVERNED BY THE UNIFORM CUSTOMS, THE LAWS OF THE STATE OF NEW YORK.


 


10.17      Successors
and Assigns


 


This
Agreement shall be binding upon the parties hereto and their respective
successors and assigns and shall inure to the benefit of the parties hereto and
the successors and assigns of Lenders. 
Neither the rights or obligations of Company or any Borrower under the
Loan Documents nor any interest therein may be assigned without the written
consent of all Lenders.  Lenders’ rights
of assignment are subject to subsection 10.2.


 


10.18      Consent to Jurisdiction and Service of
Process


 


ALL
JUDICIAL PROCEEDINGS BROUGHT AGAINST COMPANY OR ANY BORROWER ARISING OUT OF OR
RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR ANY OBLIGATIONS
THEREUNDER, MAY BE BROUGHT IN ANY STATE OR FEDERAL COURT OF COMPETENT
JURISDICTION IN THE STATE, COUNTY AND CITY OF NEW YORK.  BY EXECUTING AND DELIVERING THIS AGREEMENT,
COMPANY AND EACH BORROWER, FOR ITSELF AND IN CONNECTION WITH ITS PROPERTIES,
EACH IRREVOCABLY


 


(I)            ACCEPTS GENERALLY AND
UNCONDITIONALLY THE NONEXCLUSIVE JURISDICTION AND VENUE OF SUCH COURTS;


 


(II)           WAIVES ANY DEFENSE OF FORUM NON CONVENIENS;


 


(III)         AGREES THAT SERVICE OF ALL PROCESS IN
ANY SUCH PROCEEDING IN ANY SUCH COURT MAY BE MADE BY REGISTERED OR CERTIFIED
MAIL, RETURN RECEIPT REQUESTED, TO COMPANY OR


 


183
















 


SUCH
BORROWER AT ITS ADDRESS PROVIDED IN ACCORDANCE WITH SUBSECTION 10.10;


 


(IV)         AGREES THAT SERVICE AS PROVIDED IN
CLAUSE (III) ABOVE IS SUFFICIENT TO CONFER PERSONAL JURISDICTION OVER COMPANY
OR SUCH BORROWER IN ANY SUCH PROCEEDING IN ANY SUCH COURT, AND OTHERWISE
CONSTITUTES EFFECTIVE AND BINDING SERVICE IN EVERY RESPECT;


 


(V)          AGREES THAT LENDERS RETAIN THE RIGHT
TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR TO BRING PROCEEDINGS
AGAINST SUCH BORROWER IN THE COURTS OF ANY OTHER JURISDICTION; AND


 


(VI)         AGREES THAT THE PROVISIONS OF THIS
SUBSECTION 10.18 RELATING TO JURISDICTION AND VENUE SHALL BE BINDING AND
ENFORCEABLE TO THE FULLEST EXTENT PERMISSIBLE UNDER NEW YORK GENERAL
OBLIGATIONS LAW SECTION 5-1402 OR OTHERWISE.


 


10.19      Waiver of Jury
Trial


 


EACH
OF THE PARTIES TO THIS AGREEMENT HEREBY AGREES TO WAIVE ITS RESPECTIVE RIGHTS
TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF
THIS AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS OR ANY DEALINGS BETWEEN THEM
RELATING TO THE SUBJECT MATTER OF THIS LOAN TRANSACTION OR THE LENDER/BORROWER
RELATIONSHIP THAT IS BEING ESTABLISHED. 
The scope of this waiver is intended to be all-encompassing of any and
all disputes that may be filed in any court and that relate to the subject matter
of this transaction, including without limitation contract claims, tort claims,
breach of duty claims and all other common law and statutory claims.  Each party hereto acknowledges that this
waiver is a material inducement to enter into a business relationship, that
each has already relied on this waiver in entering into this Agreement, and
that each will continue to rely on this waiver in their related future
dealings.  Each party hereto further
warrants and represents that it has reviewed this waiver with its legal counsel
and that it knowingly and voluntarily waives its jury trial rights following
consultation with legal counsel.  THIS
WAIVER IS IRREVOCABLE, MEANING THAT IT MAY NOT BE MODIFIED EITHER ORALLY OR IN
WRITING, AND THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS,
SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT OR ANY OF THE OTHER LOAN
DOCUMENTS OR TO ANY OTHER DOCUMENTS OR AGREEMENTS RELATING TO THE LOANS MADE
HEREUNDER.  In the event of litigation,
this Agreement may be filed as a written consent to a trial by the court.


 


10.20      Confidentiality


 


Lenders
shall hold all non-public information obtained prior to or after the execution
of this Agreement (including pursuant to the requirements of this Agreement or
any other Loan Document) which has been identified as such by Company or any of
its Subsidiaries


 


184
















 


in
accordance with their customary procedures for handling confidential
information of this nature and in accordance with safe and sound banking
practices and in any event (i) subject to subsection 10.2, may make
disclosure reasonably required by any bona fide transferee or participant in
connection with the contemplated transfer of any Commitment, any Loan, any
Letter of Credit or any participation therein; (ii) may make disclosure as
required or requested by any governmental agency or representative thereof or
pursuant to legal process, provided that, unless specifically prohibited
by applicable law or court order, each Lender shall notify Company of any
request by any governmental agency or representative thereof (other than any
such request in connection with an examination of the financial condition of
such Lender by such governmental agency) for disclosure of any such non-public
information prior to disclosure of such information; and (iii) may make
disclosure to their respective advisors and Affiliates in connection herewith, provided
that each such Affiliate is advised of and agrees in writing to be bound by the
provisions of this subsection 10.20; and further  provided
that in no event shall any Lender be obligated or required to return any
materials furnished by Company or any of its Subsidiaries.  Each Lender’s obligations under this
subsection 10.20 shall survive the termination of this Agreement and any
release of such Lender’s obligations under this Agreement pursuant to
subsection 10.2B(i); and provided, further, that, subject to the
applicable Lender’s compliance with this subsection 10.20, no Lender shall
be liable for any damages arising from the use by others of non-public
information or other materials obtained through internet, Intralinks or similar
information transmission systems in connection with the Loan Documents and the
transactions contemplated thereunder.


 


10.21      Judgment Currency


 


A.    If, for the purposes of obtaining judgment in any court, it is
necessary to convert a sum due hereunder in any currency (the “Original Currency”) into another currency
(the “Other Currency”), the
parties hereto agree, to the fullest extent permitted by law, that the rate of
exchange used shall be that at which in accordance with normal banking
procedures Administrative Agent or a Lender could purchase the Original
Currency with such Other Currency in New York, New York on the Business Day
immediately preceding the day on which any such judgment, or any relevant part
thereof, is given.


 


B.    The obligations of Company and each Borrower in respect of any
sum due from it to any Agent or Lender hereunder shall, notwithstanding any judgment
in such Other Currency, be discharged only to the extent that on the Business
Day following receipt by such Agent or Lender of any sum adjudged to be so due
in such Other Currency such Agent or Lender may in accordance with normal
banking procedures purchase the Original Currency with such Other Currency; if
the Original Currency so purchased is less than the sum originally due such
Agent or Lender in the Original Currency, Company and such Borrower agree, as a
separate obligation and notwithstanding any such judgment, to indemnify such
Agent or Lender against such loss, and if the Original Currency so purchased
exceeds the sum originally due to such Agent or Lender in the Original
Currency, such Agent or Lender shall remit such excess to such Borrower.


 


185
















 


10.22      Additional
Offshore Borrowers


 


The
initial Offshore Borrowers hereunder shall be United Glass, O-I Australia, ACI,
O-I Canada, Avir and BSN.  From time to
time subsequent to the date hereof, Company may, with the consent of
Administrative Agent and Requisite Lenders, designate additional Australian
Subsidiaries as Australian Offshore Borrowers with respect to Australian
Revolving Loans (each such designated Australian Subsidiary being an “Additional Offshore Borrower”), and any such Australian
Subsidiary may become an Australian Offshore Borrower by executing (i) a
Borrowing Subsidiary Agreement substantially in the form of Exhibit XVIII
annexed hereto executed by such Australian Subsidiary, Company and each other
Borrower, (ii) Australian Revolving Loan Notes as required by
subsection 2.1G, (iii) security documents required under
subsection 5.9B and the Australian Cross Guaranty, (iv) Mortgages as
required by subsection 5.10A, (v) a certificate executed by the secretary,
an assistant secretary or any director of such Subsidiary as to (a) the fact
that attached copies of such Subsidiary’s Organizational Documents are true and
correct copies thereof, (b) the fact that attached resolutions of the Governing
Body of such Subsidiary approving and authorizing the execution, delivery and
performance of the Borrowing Subsidiary Agreement and the Credit Agreement as
modified thereby are in full force and effect and have not been modified or
amended, (c) the fact that attached copies of powers of attorney, if any, are
true and correct copies thereof, and (d) the incumbency and signatures of
the officers of such Subsidiary executing the Borrowing Subsidiary Agreement
(and, if applicable, any powers of attorney authorizing other Persons to
execute such Borrowing Subsidiary Agreement), and (vi) such other
documents as Administrative Agent may reasonably request, all of the foregoing
to be satisfactory in form and substance to Administrative Agent and its counsel.
 Upon delivery of such executed Borrowing
Subsidiary Agreement by the other Borrowers, notice of which is hereby waived
by the Borrowers, and each of the other documents referred to in the
immediately preceding sentence, each such Additional Offshore Borrower shall be
an Australian Offshore Borrower and shall be as fully a party hereto as if such
Subsidiary were an original signatory hereto as an Offshore Borrower.  Company and each Borrower hereby expressly
agrees that its Obligations arising hereunder or under the other Loan Documents
shall not be affected or diminished by the addition or release of any Offshore
Borrower hereunder.


 


10.23      Spanish Court Enforcement and
Unilateral Determination of Debt


 


For
purposes of enforcement of any Offshore Collateral Documents and Offshore
Guaranties executed by a Loan Party organized under the laws of Spain:


 


A.    Special
Loan Account. The
Collateral Agent shall open in its account books a special account for BSN in
which the following entries shall be made, as appropriate, in relation to the
French Tranche C1 Term Loans and the French Tranche C2 Term Loans:


 


DEBIT:


 


•            The
sum drawn down by BSN by way of principal.


 


•                                The sum of the interest,
commissions, and any other items whatsoever due from BSN under the French Tranche
C1 Term Loans and the French Tranche C2 Term Loans.


 


186
















 


CREDIT:


 


•                                Payments made by BSN by way of
settlement or repayment of the above mentioned items.


 


In this way the net balance owed by BSN under the French Tranche C1 Term
Loans and the French Tranche C2 Term Loans shall be known at all times.


 


B.    Unilateral
Determination of Debt.  In the case
of accelerated maturity of the French Tranche C1 Term Loans and the French
Tranche C2 Term Loans or of total or partial termination of such loans under
this Agreement, the Collateral Agent shall balance the accounts mentioned in
subsection 10.23A in accordance with this Agreement, BSN and Collateral Agent
expressly agreeing that the clear, due and demandable sum (in accordance with
the provisions of Articles 571 and 572 of Spanish Code of Civil Procedure
1/2000, of 7 January), for the purposes of payment and processing of the
enforcement of accelerated maturity or for the purposes of judicial or
extra-judicial claims, shall be the balance arising from said balancing of
accounts, duly certified by the Collateral Agent. BSN shall be notified of the
demandable sum arising from the aforementioned balancing of accounts in
accordance with Article 572.2 in fine of the
aforementioned Act.


 


The enforcing document shall be a copy of the
public deed formalising this Agreement, issued with the formalities
established in Article 517.2.5o of Spanish Code of Civil Procedure 1/2000, of 7
January, which must be accompanied by the following documents:


 


(i)            The certificate
referred to in the first paragraph of this subsection 10.23B, which details the
balance of the account mentioned in subsection 10.23A, arising from the
balancing of accounts performed by the Collateral Agent. In said certificate,
the Notary must place on record that he/she is acting at the request of the
Collateral Agent and that the balancing of BSN’s account has been carried out
in the manner agreed by the Parties herein.


 


(ii)           A statement
detailing the debit and credit entries and those relating to the application of
interest which give rise to the specific balance in respect of which court
enforcement of accelerated maturity is requested.


 


(iii)          The document which
proves that BSN has been notified of the amount due, in accordance with the
terms of the first paragraph of this subsection 10.23B.


 


10.24      Limitation on Offshore Borrower
Obligations


 


Notwithstanding
anything herein to the contrary, no provision of this Agreement shall render
any Offshore Borrower liable for the Obligations of Company or of any Domestic
Borrower. Notwithstanding anything herein to the contrary, no provision of this
Agreement shall render BSN liable for the Obligations of Company or any other
Borrower.


 


187
















 


10.25      Counterparts;
Effectiveness


 


Any
amendments, waivers, consents, or supplements hereto may be executed in any
number of counterparts and by different parties hereto in separate
counterparts, each of which when so executed and delivered shall be deemed an
original, but all such counterparts, together shall constitute but one and the
same instrument.  This Agreement shall
become effective upon satisfaction of the conditions set forth in Section 7 of
the First Amendment to the Second Amended and Restated Credit Agreement and
execution and delivery of this Agreement by the Company, the Borrowers and the
Administrative Agent.  Until such time as
such conditions are satisfied, the Second Amended and Restated Agreement shall
remain in full force and effect.


 


188
















 


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


 


	
   

  	
  OWENS-ILLINOIS GROUP, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
    /s/ James W. Baehren

  	
   

  
	
   

  	
   

  	
  Name:  James W. Baehren

  
	
   

  	
   

  	
  Title:  Vice President & Secretary

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  OWENS-BROCKWAY GLASS CONTAINER
  INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
    /s/ James W. Baehren

  	
   

  
	
   

  	
   

  	
  Name:  James W. Baehren

  
	
   

  	
   

  	
  Title:  Vice President & Secretary

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  OI PLASTIC PRODUCTS FTS INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
    /s/ James W. Baehren

  	
   

  
	
   

  	
   

  	
  Name:  James W. Baehren

  
	
   

  	
   

  	
  Title:  Vice President & Secretary

  
	
   

  	
   

  
	
   

  	
  UNITED GLASS LIMITED

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
    /s/ James W. Baehren

  	
   

  
	
   

  	
   

  	
  Name:  James W. Baehren

  
	
   

  	
   

  	
  Title:  By Power of Attorney

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  OWENS ILLINOIS (AUSTRALIA) PTY
  LIMITED

  
	
   

  	
   

  
	
   

  	
  By:

  	
    /s/ James W. Baehren

  	
   

  
	
   

  	
   

  	
  Name:  James W. Baehren

  
	
   

  	
   

  	
  Title:  By Power of Attorney

  



 


S-1
















 


	
   

  	
  ACI OPERATIONS PTY LIMITED

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
    /s/ James W. Baehren

  	
   

  
	
   

  	
   

  	
  Name:  James W. Baehren

  
	
   

  	
   

  	
  Title:  Authorized Signatory

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  AZIENDE
  VETRARIE INDUSTRIALI RICCIARDI –

  AVIR S.P.A.,

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
    /s/ James W. Baehren

  	
   

  
	
   

  	
   

  	
  Name:  James W. Baehren

  
	
   

  	
   

  	
  Title:  By Power of Attorney

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  O-I CANADA CORP.

  
	
   

  	
   

  
	
   

  	
  By:

  	
    /s/ James W. Baehren

  	
   

  
	
   

  	
   

  	
  Name:  James W. Baehren

  
	
   

  	
   

  	
  Title:  Vice President & Secretary

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  BSN GLASSPACK, S.A.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
    /s/ James W. Baehren

  	
   

  
	
   

  	
   

  	
  Name:  James W. Baehren

  
	
   

  	
   

  	
  Title:  By Power of Attorney

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  OWENS-ILLINOIS GENERAL, INC.,
  as Borrowers’

  Agent

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
    /s/ James W. Baehren

  	
   

  
	
   

  	
   

  	
  Name:  James W. Baehren

  
	
   

  	
   

  	
  Title:  Vice President & Secretary

  



 


S-2
















 


	
  AGENTS
  AND LENDERS:

  	
   

  
	
   

  	
   

  
	
   

  	
  DEUTSCHE BANK TRUST COMPANY
  AMERICAS,

  
	
   

  	
  as Administrative Agent

  
	
   

  	
   

  
	
   

  	
  By:

  	
    /s/ Gregory Shefrin

  	
   

  
	
   

  	
   

  	
  Name:  Gregory Shefrin

  
	
   

  	
   

  	
  Title: 
  Director

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Notice
  Address:

  
	
   

  	
   

  
	
   

  	
   

  	
  Deutsche Bank Trust
  Company Americas

  
	
   

  	
   

  	
  90 Hudson Street

  
	
   

  	
   

  	
  MS JCY050-199

  
	
   

  	
   

  	
  Jersey City, New Jersey
  07302

  
	
   

  	
   

  	
  Attention:  Commercial Loan Division

  
	
   

  	
   

  
	
   

  	
  With a
  copy to:

  
	
   

  	
   

  
	
   

  	
   

  	
  Deutsche Bank Trust
  Company Americas

  
	
   

  	
   

  	
  222 South Riverside
  Plaza

  
	
   

  	
   

  	
  MS CHI105-2900

  
	
   

  	
   

  	
  Chicago, Illinois  60606

  
	
   

  	
   

  	
  Attention: Marla Heller
  and Linda Stahulak

  



 


S-3