Exhibit 10.1


 


[Execution]


 


LOAN AND SECURITY AGREEMENT


 


by and among


 


TRAVELCENTERS OF AMERICA LLC


TA LEASING LLC


TA OPERATING LLC


 


as Borrowers


 


and


 


TRAVELCENTERS OF AMERICA HOLDING COMPANY LLC


PETRO STOPPING CENTERS, L.P.


PETRO DISTRIBUTING INC.


PETRO FINANCIAL CORPORATION


PETRO HOLDINGS FINANCIAL CORPORATION


TCA PSC GP LLC


 


as Guarantors


 


WACHOVIA CAPITAL FINANCE CORPORATION (CENTRAL)


as Agent


 


and


 


THE LENDERS FROM TIME TO TIME PARTY HERETO


as Lenders


 


and


 


WACHOVIA CAPITAL MARKETS, LLC


as Sole Lead Arranger, Manager and Bookrunner


 


NATIONAL CITY BUSINESS CREDIT, INC.


as Syndication Agent


 


Dated: November 19, 2007


 

















 


TABLE OF CONTENTS


 


	
   

  	
   

  	
   

  	
  Page No.

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 1.

  	
  DEFINITIONS

  	
  1

  
	
   

  	
   

  	
   

  
	
  SECTION 2.

  	
  CREDIT FACILITIES

  	
  36

  
	
   

  	
  2.1

  	
  Loans

  	
  36

  
	
   

  	
  2.2

  	
  Letter of Credit Accommodations

  	
  37

  
	
   

  	
  2.3

  	
  Increase in Maximum Credit

  	
  41

  
	
   

  	
  2.4

  	
  Decrease in Maximum Credit

  	
  42

  
	
   

  	
  2.5

  	
  Commitments

  	
  43

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 3.

  	
  INTEREST AND FEES; PROCEDURES FOR BORROWING

  	
  43

  
	
   

  	
  3.1

  	
  Interest; Procedures for Borrowing

  	
  43

  
	
   

  	
  3.2

  	
  Fees

  	
  44

  
	
   

  	
  3.3

  	
  Changes in Laws and Increased Costs of Loans

  	
  45

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 4.

  	
  CONDITIONS PRECEDENT

  	
  47

  
	
   

  	
  4.1

  	
  Conditions Precedent to Initial Loans and Letter of Credit
  Accommodations

  	
  47

  
	
   

  	
  4.2

  	
  Conditions Precedent to All Loans and Letter of Credit Accommodations

  	
  49

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 5.

  	
  GRANT AND PERFECTION OF SECURITY INTEREST

  	
  49

  
	
   

  	
  5.1

  	
  Grant of Security Interest

  	
  49

  
	
   

  	
  5.2

  	
  Perfection of Security Interests

  	
  51

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 6.

  	
  COLLECTION AND ADMINISTRATION

  	
  55

  
	
   

  	
  6.1

  	
  Borrowers’ Loan Accounts

  	
  55

  
	
   

  	
  6.2

  	
  Statements

  	
  55

  
	
   

  	
  6.3

  	
  Collection of Accounts

  	
  55

  
	
   

  	
  6.4

  	
  Payments

  	
  57

  
	
   

  	
  6.5

  	
  Authorization to Make Loans

  	
  58

  
	
   

  	
  6.6

  	
  Use of Proceeds

  	
  58

  
	
   

  	
  6.7

  	
  Appointment of Administrative Borrower as Agent for Requesting Loans
  and Receipts of Loans and Statements

  	
  59

  
	
   

  	
  6.8

  	
  Pro Rata Treatment

  	
  59

  
	
   

  	
  6.9

  	
  Sharing of Payments, Etc

  	
  59

  
	
   

  	
  6.10

  	
  Settlement Procedures

  	
  60

  
	
   

  	
  6.11

  	
  Obligations Several; Independent Nature of Lenders’ Rights

  	
  63

  
	
   

  	
  6.12

  	
  Bank Products

  	
  63

  
	
   

  	
  6.13

  	
  Taxes

  	
  63

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 7.

  	
  COLLATERAL REPORTING AND COVENANTS

  	
  66

  
	
   

  	
  7.1

  	
  Collateral Reporting

  	
  66

  
	
   

  	
  7.2

  	
  Accounts Covenants

  	
  67

  
	
   

  	
  7.3

  	
  Inventory Covenants

  	
  69

  



 


i

















 


	
   

  	
  7.4

  	
  Equipment and Real Property Covenants

  	
  69

  
	
   

  	
  7.5

  	
  Power of Attorney

  	
  70

  
	
   

  	
  7.6

  	
  Right to Cure

  	
  71

  
	
   

  	
  7.7

  	
  Access to Premises

  	
  71

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 8.

  	
  REPRESENTATIONS AND WARRANTIES

  	
  71

  
	
   

  	
  8.1

  	
  Existence, Power and Authority

  	
  72

  
	
   

  	
  8.2

  	
  Name; State of Organization; Chief Executive Office; Collateral
  Locations

  	
  72

  
	
   

  	
  8.3

  	
  Financial Statements; No Material Adverse Change

  	
  73

  
	
   

  	
  8.4

  	
  Priority of Liens; Title to Properties

  	
  73

  
	
   

  	
  8.5

  	
  Tax Returns

  	
  73

  
	
   

  	
  8.6

  	
  Litigation

  	
  74

  
	
   

  	
  8.7

  	
  Compliance with Other Agreements and Applicable Laws

  	
  74

  
	
   

  	
  8.8

  	
  Environmental Compliance

  	
  74

  
	
   

  	
  8.9

  	
  Employee Benefits

  	
  75

  
	
   

  	
  8.10

  	
  Bank Accounts

  	
  76

  
	
   

  	
  8.11

  	
  Intellectual Property

  	
  76

  
	
   

  	
  8.12

  	
  Subsidiaries; Affiliates; Capitalization; Solvency

  	
  77

  
	
   

  	
  8.13

  	
  Labor Disputes

  	
  77

  
	
   

  	
  8.14

  	
  Restrictions on Subsidiaries

  	
  77

  
	
   

  	
  8.15

  	
  Material Contracts

  	
  78

  
	
   

  	
  8.16

  	
  Credit Card Agreements

  	
  78

  
	
   

  	
  8.17

  	
  Interrelated Businesses

  	
  78

  
	
   

  	
  8.18

  	
  Payable Practices

  	
  79

  
	
   

  	
  8.19

  	
  Customer Loyalty Account Assets

  	
  79

  
	
   

  	
  8.20

  	
  Propco. Each Propco does not own, and will not own or acquire, any
  assets other than Real Property and Equipment

  	
  79

  
	
   

  	
  8.21

  	
  Accuracy and Completeness of Information

  	
  79

  
	
   

  	
  8.22

  	
  Survival of Warranties; Cumulative

  	
  79

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 9.

  	
  AFFIRMATIVE AND NEGATIVE COVENANTS

  	
  79

  
	
   

  	
  9.1

  	
  Maintenance of Existence

  	
  79

  
	
   

  	
  9.2

  	
  New Collateral Locations

  	
  80

  
	
   

  	
  9.3

  	
  Compliance with Laws, Regulations, Etc.

  	
  80

  
	
   

  	
  9.4

  	
  Payment of Taxes and Claims

  	
  81

  
	
   

  	
  9.5

  	
  Insurance

  	
  81

  
	
   

  	
  9.6

  	
  Financial Statements and Other Information

  	
  82

  
	
   

  	
  9.7

  	
  Sale of Assets, Consolidation, Merger,
  Dissolution, Etc.

  	
  84

  
	
   

  	
  9.8

  	
  Encumbrances

  	
  87

  
	
   

  	
  9.9

  	
  Indebtedness

  	
  89

  
	
   

  	
  9.10

  	
  Loans, Investments, Etc.

  	
  91

  
	
   

  	
  9.11

  	
  Dividends and Redemptions

  	
  94

  
	
   

  	
  9.12

  	
  Transactions with Affiliates and HPT Companies

  	
  95

  
	
   

  	
  9.13

  	
  Compliance with ERISA

  	
  95

  
	
   

  	
  9.14

  	
  End of Fiscal Years; Fiscal Quarters

  	
  96

  
	
   

  	
  9.15

  	
  Change in Business

  	
  96

  



 


ii

















 


	
   

  	
  9.16

  	
  Limitation of Restrictions Affecting Subsidiaries

  	
  96

  
	
   

  	
  9.17

  	
  Minimum Fixed Charge Coverage Ratio

  	
  96

  
	
   

  	
  9.18

  	
  Credit Card Agreements

  	
  96

  
	
   

  	
  9.19

  	
  License Agreements

  	
  97

  
	
   

  	
  9.20

  	
  Costs and Expenses

  	
  98

  
	
   

  	
  9.21

  	
  Further Assurances

  	
  98

  
	
   

  	
  9.22

  	
  Petro Existing Letters of Credit

  	
  100

  
	
   

  	
  9.23

  	
  Petro Existing Security Agreement

  	
  100

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 10.

  	
  EVENTS OF DEFAULT AND REMEDIES

  	
  100

  
	
   

  	
  10.1

  	
  Events of Default

  	
  100

  
	
   

  	
  10.2

  	
  Remedies

  	
  102

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 11.

  	
  JURY TRIAL WAIVER; OTHER WAIVERS AND
  CONSENTS; GOVERNING LAW

  	
  105

  
	
   

  	
  11.1

  	
  Governing Law; Choice of Forum; Service of Process; Jury Trial Waiver

  	
  106

  
	
   

  	
  11.2

  	
  Waiver of Notices

  	
  107

  
	
   

  	
  11.3

  	
  Amendments and Waivers

  	
  107

  
	
   

  	
  11.4

  	
  Waiver of Counterclaims

  	
  109

  
	
   

  	
  11.5

  	
  Indemnification

  	
  109

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 12.

  	
  THE AGENT

  	
  110

  
	
   

  	
  12.1

  	
  Appointment, Powers and Immunities

  	
  110

  
	
   

  	
  12.2

  	
  Reliance by Agent

  	
  110

  
	
   

  	
  12.3

  	
  Events of Default

  	
  110

  
	
   

  	
  12.4

  	
  Wachovia in its Individual Capacity

  	
  111

  
	
   

  	
  12.5

  	
  Indemnification

  	
  111

  
	
   

  	
  12.6

  	
  Non-Reliance on Agent and Other Lenders

  	
  112

  
	
   

  	
  12.7

  	
  Failure to Act

  	
  112

  
	
   

  	
  12.8

  	
  Additional Loans

  	
  112

  
	
   

  	
  12.9

  	
  Concerning the Collateral and the Related Financing Agreements

  	
  113

  
	
   

  	
  12.10

  	
  Field Audit, Examination Reports and other Information; Disclaimer by
  Lenders

  	
  113

  
	
   

  	
  12.11

  	
  Collateral Matters

  	
  113

  
	
   

  	
  12.12

  	
  Agency for Perfection

  	
  115

  
	
   

  	
  12.13

  	
  Successor Agent

  	
  116

  
	
   

  	
  12.14

  	
  Other Agent Designations

  	
  116

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 13.

  	
  TERM OF AGREEMENT; MISCELLANEOUS

  	
  116

  
	
   

  	
  13.1

  	
  Term

  	
  116

  
	
   

  	
  13.2

  	
  Interactive Provisions

  	
  117

  
	
   

  	
  13.3

  	
  Notices

  	
  119

  
	
   

  	
  13.4

  	
  Partial Invalidity

  	
  119

  
	
   

  	
  13.5

  	
  Confidentiality

  	
  119

  
	
   

  	
  13.6

  	
  Successors

  	
  121

  
	
   

  	
  13.7

  	
  Assignments; Participations

  	
  121

  



 


iii

















 


	
   

  	
  13.8

  	
  USA Patriot Act

  	
  123

  
	
   

  	
  13.9

  	
  Entire Agreement

  	
  123

  
	
   

  	
  13.10

  	
  Counterparts, Etc

  	
  123

  



 


iv

















 


INDEX TO


EXHIBITS AND SCHEDULES


 


	
   

  	
  Exhibit A

  	
  Form of
  Assignment and Acceptance

  
	
   

  	
   

  	
   

  
	
   

  	
  Exhibit B

  	
  Information
  Certificate

  
	
   

  	
   

  	
   

  
	
   

  	
  Exhibit C

  	
  Form of
  Compliance Certificate

  
	
   

  	
   

  	
   

  
	
   

  	
  Exhibit D

  	
  Form of
  Borrowing Base Certificate

  
	
   

  	
   

  	
   

  
	
   

  	
  Schedule 1

  	
  Commitments

  
	
   

  	
   

  	
   

  
	
   

  	
  Schedule 1.18

  	
  Excluded Capital
  Leases

  
	
   

  	
   

  	
   

  
	
   

  	
  Schedule 1.66

  	
  Excluded
  Subsidiaries

  
	
   

  	
   

  	
   

  
	
   

  	
  Schedule 1.118

  	
  Petro Existing
  Letters of Credit

  
	
   

  	
   

  	
   

  
	
   

  	
  Schedule 8.16

  	
  Credit Card
  Agreements

  



 


v

















 


LOAN AND SECURITY AGREEMENT


 


This Loan and Security Agreement dated November 19,
2007 is entered into by and among TravelCenters of America LLC, a Delaware
limited liability company, (“TravelCenters” or “Parent”), TA Leasing LLC, a
Delaware limited liability company (“TA Leasing”), TA Operating LLC, a Delaware
limited liability company (“TA Operating,” and together with TravelCenters, TA
Leasing and each other Person that becomes a “Borrower” after the date hereof
in accordance with Section 9.21 hereof, each individually a “Borrower” and
collectively, “Borrowers”), TravelCenters of America Holding Company LLC, a
Delaware limited liability Company (“Holding”), Petro Stopping Centers, L.P., a
Delaware limited partnership (“Petro”), Petro Distributing Inc., a Delaware
corporation (“Petro Distributing”), Petro Financial Corporation, a Delaware
corporation (“Petro Financial”), Petro Holdings Financial Corporation, a
Delaware corporation (“Petro Holdings”), TCA PSC GP LLC, a Delaware limited liability
company (“TCA” and together with Holding, Petro, Petro Distributing, Petro
Financial, Petro Holdings and each other Person that becomes a “Guarantor”
after the date hereof in accordance with Section 9.21 hereof, each
individually a “Guarantor” and collectively, “Guarantors”), the parties hereto
from time to time as lenders, whether by execution of this Agreement or an
Assignment and Acceptance (each individually, a “Lender” and collectively, “Lenders”)
and Wachovia Capital Finance Corporation (Central), an Illinois corporation, in
its capacity as agent for Lenders (in such capacity, “Agent”).


 


W  I  T  N  E
S  S  E  T  H:


 


WHEREAS, Borrowers and Guarantors have requested that
Agent and Lenders enter into financing arrangements with Borrowers pursuant to
which Lenders may make loans and provide other financial accommodations to
Borrowers; and


 


WHEREAS, each Lender is willing to agree (severally
and not jointly) to make such loans and provide such financial accommodations
to Borrowers on a pro  rata basis according to its Commitment (as
defined below) on the terms and conditions set forth herein and Agent is
willing to act as agent for Lenders on the terms and conditions set forth
herein and the other Financing Agreements;


 


NOW, THEREFORE, in consideration of the mutual
conditions and agreements set forth herein, and for other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged, the
parties hereto agree as follows:


 


SECTION 1.                              DEFINITIONS


 


For purposes of this Agreement, the following terms
shall have the respective meanings given to them below:


 


1.1  “Accounts”
shall mean, as to each Borrower and Guarantor, all present and future rights of
such Borrower and Guarantor to payment of a monetary obligation, whether or not
earned by performance, which is not evidenced by chattel paper or an
instrument, (a) for property that has been or is to be sold, leased,
licensed, assigned, or otherwise disposed of, (b) for services rendered or
to be rendered, (c) for a secondary obligation incurred or to be incurred,



 

















 


or (d) arising out
of the use of a credit or charge card or information contained on or for use
with the card.


 


1.2  “Acquired
Business” shall have the meaning specified in the definition of Permitted
Acquisitions.


 


1.3  “Adjusted
Excess Availability” shall mean the amount, as determined by Agent, calculated
at any date, equal to: (a) the Borrowing Base, minus (b) the
amount of all then outstanding Revolving Loans, minus (c) the
amount of all then outstanding Letter of Credit Accommodations.


 


1.4  “Adjusted
Eurodollar Rate” shall mean, with respect to each Interest Period for any
Eurodollar Rate Loan comprising part of the same borrowing (including
conversions, extensions and renewals), the rate per annum determined by
dividing (a) the London Interbank Offered Rate for such Interest Period by
(b) a percentage equal to: (i) one (1) minus (ii) the
Reserve Percentage. For purposes hereof, “Reserve Percentage” shall mean for
any day, that percentage (expressed as a decimal) which is in effect from time
to time under Regulation D of the Board of Governors of the Federal Reserve
System (or any successor), as such regulation may be amended from time to
time or any successor regulation, as the maximum reserve requirement
(including, without limitation, any basic, supplemental, emergency, special, or
marginal reserves) applicable with respect to Eurocurrency liabilities as that
term is defined in Regulation D (or against any other category of liabilities
that includes deposits by reference to which the interest rate of Eurodollar
Rate Loans is determined), whether or not any Lender has any Eurocurrency
liabilities subject to such reserve requirement at that time. Eurodollar Loans
shall be deemed to constitute Eurocurrency liabilities and as such shall be
deemed subject to reserve requirements without benefits of credits for
proration, exceptions or offsets that may be available from time to time
to a Lender. The Adjusted Eurodollar Rate shall be adjusted automatically on
and as of the effective date of any change in the Reserve Percentage.


 


1.5  “Administrative
Borrower” shall mean TravelCenters of America LLC, a Delaware liability company
in its capacity as Administrative Borrower on behalf of itself and the other
Borrowers pursuant to Section 6.7 hereof and its successors and assigns in
such capacity.


 


1.6  “Affiliate”
shall mean, with respect to a specified Person, any other Person which directly
or indirectly, through one or more intermediaries, controls or is controlled by
or is under common control with such Person, and without limiting the
generality of the foregoing, includes (a) any Person which beneficially
owns or holds ten (10%) percent or more of any class of Voting Stock of
such Person or other equity interests in such Person, (b) any Person of
which such Person beneficially owns or holds ten (10%) percent or more of any class of
Voting Stock or in which such Person beneficially owns or holds ten (10%)
percent or more of the equity interests and (c) any director or executive
officer of such Person. For the purposes of this definition, the term “control”
(including with correlative meanings, the terms “controlled by” and “under
common control with”), as used with respect to any Person, means the
possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of such Person, whether through the
ownership of Voting Stock, by agreement or otherwise. For the avoidance of
doubt, no HPT Company shall be deemed to be an Affiliate of any Borrower or
Guarantor unless either such HPT Company directly or indirectly beneficially
owns or holds ten (10%) percent or more of any class of Voting Stock or
other equity interests in such Borrower or Guarantor or any Borrower or
Guarantor beneficially directly or indirectly 


 


2

















 


owns or holds ten (10%)
percent or more of any class of Voting Stock or other equity interests in
such HPT Company.


 


1.7  “Agent”
shall mean Wachovia Capital Finance Corporation (Central), in its capacity as
agent on behalf of Lenders pursuant to the terms hereof and any replacement or
successor agent hereunder.


 


1.8  “Agent
Payment Account” shall mean account no. 5000000030266 of Agent at Wachovia
Bank, National Association, or such other account of Agent as Agent may from
time to time designate to Administrative Borrower as the Agent Payment Account
for purposes of this Agreement and the other Financing Agreements.


 


1.9  “Applicable
Margin” shall mean, at any time, as to the interest rate for Prime Rate Loans
and the interest rate for Eurodollar Rate Loans, the applicable percentage (on
a per annum basis) set forth below if the Monthly Average Adjusted Excess
Availability for the immediately preceding calendar month is at or within the
amounts indicated for such percentage as of the last day of the immediately
preceding calendar month:


 




	
  Tier

  	
   

  	
  Monthly Average Adjusted 

  Excess Availability

  	
   

  	
  Applicable 

  Eurodollar Rate 

  Margin

  	
   

  	
  Applicable 

  Prime Rate 

  Margin

  	
   

  
	
  1

  	
   

  	
  Greater than
  $40,000,000

  	
   

  	
  1.00

  	
  %

  	
  0

  	
  %

  
	
  2

  	
   

  	
  Less than or
  equal to $40,000,000 and greater than $20,000,000

  	
   

  	
  1.25

  	
  %

  	
  0

  	
  %

  
	
  3

  	
   

  	
  Less than or
  equal to $20,000,000

  	
   

  	
  1.50

  	
  %

  	
  .50

  	
  %

  






 


provided,
that, (i) the Applicable Margin shall be calculated and established
once each calendar month and shall remain in effect until adjusted thereafter
after the end of the next calendar month, (ii) the Applicable Margin
through March 31, 2008 shall be the amount for Tier 1 set forth above.


 


1.10  “Assignment
and Acceptance” shall mean an Assignment and Acceptance substantially in the form of
Exhibit A attached hereto (with blanks appropriately completed) delivered
to Agent in connection with an assignment of a Lender’s interest hereunder in
accordance with the provisions of Section 13.7 hereof.


 


1.11  “Bank Products
Provider” shall mean Agent, any Lender, any Affiliate of any Lender or any
other financial institution (in each case as to any Lender, Affiliate or other
financial institution to the extent approved by Agent, which shall not be
unreasonably withheld or delayed) that provides any Bank Products to Borrowers
or Guarantors.


 


1.12  “Bank
Products” shall mean any one or more of the following types or services or
facilities provided to a Borrower or Guarantor by Agent, any Lender or any
Affiliate 


 


3

















 


of any Lender or any
other financial institution acceptable to Agent: (a) credit cards or
stored value cards or (b) cash management or related services, including (i) the
automated clearinghouse transfer of funds for the account of a Borrower or
Guarantor pursuant to agreement or overdraft for any accounts of Borrowers or
Guarantors maintained by Agent, any Lender or any Affiliate of any Lender (in
each case to the extent approved by Agent) that are subject to the control of
Agent pursuant to any Deposit Account Control Agreement to which Agent, such
Affiliate of Agent, Lender or Affiliate of Lender is a party, as applicable,
and (ii) controlled disbursement services and (iii) Hedge Agreements
if and to the extent permitted hereunder.


 


1.13  “Blocked
Accounts” shall have the meaning set forth in Section 6.3 hereof.


 


1.14  “Borrowing
Base” shall mean, at any time, the amount equal to:


 


(a)                                  the
amount equal to : (i) eighty five (85%) of Eligible Accounts, plus (ii) eighty
five (85%) percent of Eligible Credit Card Receivables, plus (iii) the
lesser of (A) the Fuel Inventory Loan Limit or (B) eighty (80%)
percent multiplied by the Value of Eligible Inventory consisting of gasoline
and diesel fuel, plus (iv) the lesser of (A) sixty five (65%)
percent multiplied by the Value of Eligible Inventory (other than Eligible
Inventory consisting of gasoline or diesel fuel) or (B) eighty five (85%)
percent of the Net Recovery Percentage multiplied by the Value of such Eligible
Inventory, plus (v) the Fixed Asset Availability, plus (vi) one
hundred (100%) percent of Eligible Cash Collateral,


 


minus


 


(b)                                 Reserves.


 


The amounts of Eligible
Inventory of any Borrower shall, at Agent’s option, be determined based on the
lesser of the amount of Inventory set forth in the general ledger of such
Borrower or the perpetual inventory records maintained by such Borrower.


 


1.15  “Borrowing
Base Certificate” shall mean a certificate substantially in the form of Exhibit D
hereto, as such form may from time to time be modified by Agent,
which is duly completed (including all schedules thereto) and executed by an
authorized officer of Administrative Borrower and delivered to Agent.


 


1.16  “Business
Day” shall mean any day other than a Saturday, Sunday, or other day on which
commercial banks are authorized or required to close under the laws of the
State of Illinois, the State of New York, or the State of North Carolina, and a
day on which Agent is open for the transaction of business, except that if a determination
of a Business Day shall relate to any Eurodollar Rate Loans, the term Business
Day shall also exclude any day on which banks are closed for dealings in dollar
deposits in the London interbank market or other applicable Eurodollar Rate
market.


 


1.17  “Capital
Expenditures” shall mean, for any period, as to any Person and its
Subsidiaries, all expenditures (without duplication) by such Person and its
Subsidiaries for, or contracts for expenditures (other than contracts for such
expenditures where payments for such expenditures are to be made in any
subsequent period) for, any fixed or capital assets or improvements, or for
replacements, substitutions or additions thereto, which have a useful life of 


 


4

















 


more than one year (1) year,
including, but not limited to, the direct or indirect acquisition of such
assets by way of offset items or otherwise and obligations under Capital Leases
incurred in respect of such fixed or capital assets during such period.


 


1.18  “Capital
Leases” shall mean, as applied to any Person, any lease of (or any agreement
conveying the right to use) any property (whether real, personal or mixed) by
such Person as lessee which in accordance with GAAP, is required to be
reflected as a liability on the balance sheet of such Person, excluding each
lease listed on Schedule 1.18 hereto.


 


1.19  “Capital
Stock” shall mean, with respect to any Person, any and all shares, interests,
participations or other equivalents (however designated) of such Person’s
capital stock or partnership, limited liability company or other equity
interests at any time outstanding, and any and all rights, warrants or options
exchangeable for or convertible into such capital stock or other interests (but
excluding any debt security that is exchangeable for or convertible into such
capital stock).


 


1.20  “Cash
Dominion Period” shall mean a period either (a) commencing on the date
that an Event of Default shall have occurred and ending on the date thereafter
that such Event of Default shall cease to be continuing or (b) commencing
on the date that Adjusted Excess Availability shall have fallen below the
amount equal to twenty (20%) percent of the Maximum Credit and ending on the
earlier of (i) the date thereafter that Adjusted Excess Availability has
been greater than the amount equal to twenty-five (25%) percent of the Maximum
Credit for ninety (90) consecutive days or (ii) the date thereafter that (A) Borrowers
and Guarantors have received cash proceeds of the issuance and sale of Capital
Stock of Parent in accordance with Section 9.7(b)(iii) hereof, cash
proceeds from the sale or disposition of assets in accordance with Section 9.7(b)(ii),
(x), (xi) or (xii), or cash proceeds of Indebtedness incurred in accordance with
Section 9.9(e) or (h) hereof, (B) no Loans are outstanding
and (C) Adjusted Excess Availability is greater than the sum of the
outstanding Letter of Credit Accommodations plus twenty-five (25%) percent of
the Maximum Credit.


 


1.21  “Cash
Equivalents” shall mean, at any time, (a) any evidence of Indebtedness
with a maturity date of ninety (90) days or less from the date of acquisition
issued or directly and fully guaranteed or insured by the United States of
America or any agency or instrumentality thereof; provided, that,
the full faith and credit of the United States of America is pledged in support
thereof; (b) certificates of deposit or bankers’ acceptances with a
maturity of ninety (90) days or less of any financial institution that is a
member of the Federal Reserve System having combined capital and surplus and
undivided profits of not less than $1,000,000,000; (c) commercial paper
(including variable rate demand notes) with a maturity of ninety (90) days or
less issued by a corporation (except an Affiliate of any Borrower or Guarantor)
organized under the laws of any State of the United States of America or the
District of Columbia and rated at least A-1 by Standard & Poor’s
Ratings Service, a division of The McGraw-Hill Companies, Inc. or at least
P-1 by Moody’s Investors Service, Inc.; (d) repurchase obligations
with a term of not more than thirty (30) days for underlying securities of the
types described in clause (a) above entered into with any financial
institution having combined capital and surplus and undivided profits of not
less than $1,000,000,000; (e) repurchase agreements and reverse repurchase
agreements relating to marketable direct obligations issued or unconditionally
guaranteed by the United States of America or issued by any governmental agency
thereof and backed by the full faith and credit of the United States of
America, in each case maturing within ninety (90) days or less from the date of
acquisition; provided, that, the terms of such agreements 


 


5

















 


comply with the
guidelines set forth in the Federal Financial Agreements of Depository
Institutions with Securities Dealers and Others, as adopted by the Comptroller
of the Currency on October 31, 1985; and (f) investments in money
market funds and mutual funds which invest substantially all of their assets in
securities of the types described in clauses (a) through (e) above.


 


1.22  “Change of
Control” shall mean, except as permitted under Section 9.7 hereof (other
than in respect of clause (c) below), (a) the transfer (in one
transaction or a series of transactions) of all or substantially all of
the assets of any Borrower or Guarantor to any Person or group (as such term is
used in Section 13(d)(3) of the Exchange Act); (b) the liquidation
or dissolution of any Borrower or Guarantor or the adoption of a plan by the
stockholders of any Borrower or Guarantor relating to the dissolution or
liquidation of such Borrower or Guarantor; (c) the acquisition by any
Person or group (as such term is used in Section 13(d)(3) of the
Exchange Act) of beneficial ownership, directly or indirectly, of 9.8% or more
of the voting power of the total outstanding Voting Stock of Parent; (d) during
any period of two (2) consecutive years, individuals who at the beginning
of such period constituted the Board of Directors of any Borrower or Guarantor
(together with any new directors whose nomination for election by the
stockholders of such Borrower or Guarantor, as the case may be, was
approved by a vote of at least sixty-six and two-thirds (66 2/3%) percent of
the directors then still in office who were either directors at the beginning
of such period or whose election or nomination for election was previously so
approved) cease for any reason to constitute a majority of the Board of
Directors of any Borrower or Guarantor then still in office;  (e) the
failure of Parent to directly own and control one hundred (100%) percent of the
voting power of the total outstanding Voting Stock of Holding, TCA or TA
Leasing; (f) the failure of Holding to directly own and control one
hundred (100%) percent of the voting power of the total outstanding Voting
Stock of TA Operating; (g) the failure of Parent and TCA, collectively, to
directly own and control one hundred (100%) percent of the voting power of the
total outstanding Voting Stock of Petro; or (h) the failure of Petro to
directly own and control one hundred (100%) percent of the voting power of the
total outstanding Voting Stock of Petro Distributing, Petro Financial or Petro
Holdings.


 


1.23  “Code”
shall mean the Internal Revenue Code of 1986, as the same now exists or may from
time to time hereafter be amended, modified, recodified or supplemented,
together with all rules, regulations and interpretations thereunder or related
thereto.


 


1.24  “Collateral”
shall have the meaning set forth in Section 5 hereof.


 


1.25  “Collateral
Access Agreement” shall mean an agreement in writing, in form and
substance reasonably satisfactory to Agent, from any lessor of premises to any
Borrower or Guarantor, or any other person to whom any Collateral is consigned
or who has custody, control or possession of any such Collateral or is
otherwise the owner or operator of any premises on which any of such Collateral
is located, in favor of Agent with respect to the Collateral at such premises
or otherwise in the custody, control or possession of such lessor, consignee or
other person.


 


1.26  “Commercial
Letter of Credit” shall mean any Letter of Credit Accommodation issued for the
purpose of providing the primary manner of payment for the purchase price of
goods or services by a Borrower or Guarantor in the ordinary course of the
business of such Borrower or Guarantor.


 


6

















 


1.27  “Commitment”
shall mean, at any time, as to each Lender, the principal amount set forth
opposite such Lender’s name on Schedule 1 hereto or on Schedule 1 to
the Assignment and Acceptance Agreement pursuant to which such Lender became a
Lender hereunder in accordance with the provisions of Section 13.7 hereof,
as the same may be adjusted from time to time in accordance with the terms
hereof; sometimes being collectively referred to herein as “Commitments”.


 


1.28  “Compliance
Certificate” shall have the meaning set forth in Section 9.6(a) hereof.


 


1.29  “Compliance
Period” shall mean the period commencing on the date on which Excess
Availability plus Unrestricted Cash has fallen below an amount equal to
thirty-five (35%) percent of the Maximum Credit and ending on a subsequent date
on which Excess Availability plus Unrestricted Cash has been greater than an
amount equal to forty (40%) percent of the Maximum Credit for each day during
three consecutive calendar months.


 


1.30  “Consolidated
Net Income” shall mean, with respect to any Person for any period, the
aggregate of the net income (loss) of such Person and its Subsidiaries, on a
consolidated basis, for such period (excluding to the extent included therein
any extraordinary and/or one time or unusual and non-recurring gains or any
non-cash losses) after deducting all charges which should be deducted before
arriving at the net income (loss) for such period and, without duplication,
after deducting the Provision for Taxes for such Period, all as determined in
accordance with GAAP; provided, that, (a) the net income of
any Person that is not a Subsidiary or that is accounted for by the equity
method of accounting shall be included only to the extent of the amount of
dividends or distributions paid or payable to such Person or a Subsidiary of
such Person; (b) except to the extent included pursuant to the foregoing
clause, the net income of any Person accrued prior to the date it becomes a
Subsidiary of such Person or is merged into or consolidated with such Person or
any of its Subsidiaries of that Person’s assets are acquired by such Person or
by its Subsidiaries shall be excluded; and (c) the net income (if
positive) of any Subsidiary (other than a Borrower or Obligor) to the extent
that the declaration or payment of dividends or similar distributions by such
Subsidiary to such Person or to any other wholly-owned Subsidiary of such
Person is not at the time permitted by operation of the terms of its charter or
any agreement, instrument, judgment, decree, order, statute, rule or
governmental regulation applicable to such Subsidiary shall be excluded. For
the purposes of this definition, net income excludes any gain or non-cash loss,
together with any related Provision for Taxes for such gain or non-cash loss,
realized upon the sale or other disposition of any assets that are not sold in
the ordinary course of business (including, without limitation, dispositions
pursuant to sale and leaseback transactions) or of any Capital Stock of such
Person or a Subsidiary of such Person and any net income realized or loss
incurred as a result of changes in accounting principles or the application
thereof to such Person.


 


1.31  “Consolidated
Rental Expense” shall mean, with respect to any Person for any period, the
aggregate amount of all real property rental expense of such Person and its
Subsidiaries, on a consolidated basis, as determined in accordance with GAAP.


 


1.32  “Credit
Card Acknowledgments” shall mean, collectively, the agreements by Credit Card
Issuers or Credit Card Processors who are parties to Credit Card Agreements in
favor of Agent acknowledging Agent’s first priority security interest, for and
on behalf of Lenders, in the monies due and to become due to a Borrower or
Guarantor (including, without 


 


7

















 


limitation, credits and
reserves) under the Credit Card Agreements, and agreeing to transfer all such
amounts to the Blocked Accounts, as the same now exist or may hereafter be
amended, modified, supplemented, extended, renewed, restated or replaced;
sometimes being referred to herein individually as a “Credit Card
Acknowledgement.”


 


1.33  “Credit
Card Agreements” shall mean all agreements now or hereafter entered into by any
Borrower or Guarantor for the benefit of any Borrower or Guarantor, in each
case with any Credit Card Issuer or any Credit Card Processor, as the same now
exist or may hereafter be amended, modified, supplemented, extended,
renewed, restated or replaced, including, but not limited to, the agreements
set forth on Schedule 8.16 hereto.


 


1.34  “Credit
Card Issuer” shall mean any person (other than a Borrower or Guarantor) who
issues or whose members issue credit cards, including, without limitation,
MasterCard or VISA bank credit or debit cards or other bank credit or debit
cards issued through MasterCard International, Inc., Visa, U.S.A., Inc.
or Visa International and American Express, Discover, Diners Club, Carte
Blanche and other non-bank credit or debit cards, including, without
limitation, credit or debit cards issued by or through Comdata Network, Inc.,
EFS Transportation Services, Inc., American Express Travel Related
Services Company, Inc., and Discover Financial Services, Inc.


 


1.35  “Credit
Card Processor” shall mean any servicing or processing agent or any factor or
financial intermediary who facilitates, services, processes or manages the
credit authorization, billing transfer and/or payment procedures with respect
to any Borrower’s or Guarantor’s sales transactions involving credit card or
debit card purchases by customers using credit cards or debit cards issued by
any Credit Card Issuer.


 


1.36  “Credit
Card Receivables” shall mean, collectively, (a) all present and future
rights of any Borrower or Guarantor to payment from any Credit Card Issuer or
Credit Card Processor arising from the sales of goods or rendition of services
to customers who have purchased such goods or services using a credit or debit
card and (b) all present and future rights of any Borrower or Guarantor to
payment from any Credit Card Issuer or Credit Card Processor in connection with
the sale or transfer of Accounts arising pursuant to the sale of goods or
rendition of services to customers who have purchased such goods or services
using a credit card or a debit card, including, but not limited to, all amounts
at any time due or to become due from any Credit Card Issuer or Credit Card
Processor under the Credit Card Agreements or otherwise.


 


1.37  “Credit
Facility” shall mean the Loans and Letter of Credit Accommodations provided to
or for the benefit of any Borrower pursuant to Sections 2.1 and 2.2 hereof.


 


1.38  “Customer
Loyalty Accounts” shall mean, collectively, (a) the investment account of
Petro maintained with Wells Fargo Institutional Securities, LLC which bears
account number 793-2466633981 and (b) one other investment account of a
Borrower or Guarantor established after the date hereof designated in writing
by the Administrative Borrower to Agent as a Customer Loyalty Account and
agreed to by Agent.


 


1.39  “Customer
Loyalty Account Assets” shall mean the Customer Loyalty Accounts and all cash
and Cash Equivalents deposited therein or credit thereto; provided, that,
in no event shall the aggregate balance of all cash and Cash Equivalents
deposited therein or 


 


8

















 


credited thereto at any
time exceed the lesser of (a) the accrued and unpaid amounts owing by
Borrowers and Guarantors under a customer loyalty program maintained by
Borrowers and Guarantors or (b) $8,000,000.


 


1.40  “Debt
Incurrence Ratio” shall mean, as to any Person, with respect to any period, the
ratio of (a) EBITDAR of such Person for such Period, to (b) the Fixed
Charges of such Person for such period.


 


1.41  “Default”
shall mean an act, condition or event which with notice or passage of time or
both would constitute an Event of Default.


 


1.42  “Defaulting
Lender” shall have the meaning set forth in Section 6.10 hereof.


 


1.43  “Deposit
Account Control Agreement” shall mean an agreement in writing, in form and
substance satisfactory to Agent, by and among Agent, the Borrower or Guarantor
with a deposit account at any bank and the bank at which such deposit account
is at any time maintained.


 


1.44  “Disqualified
Capital Stock” shall mean any Capital Stock if any Borrower or Guarantor shall
be required (a) to pay any cash dividends or cash distributions in respect
of such Capital Stock or (b) to purchase or redeem such Capital Stock or
make any payment in respect of such Capital Stock, in each case except as
otherwise permitted by Section 9.11 hereof.


 


1.45  “EBITDA”
shall mean, as to any Person, with respect to any period, an amount equal to
(without duplication): (a) the Consolidated Net Income of such Person and
its Subsidiaries for such period, plus (b) the sum of the following (in each
case to the extent deducted in the computation of Consolidated Net Income of
such Income): (i) depreciation, amortization and other non-cash charges
(including, but not limited to, imputed interest, compensation expenses settled
in Capital Stock of such Person, and deferred compensation) for such period,
all in accordance with GAAP, plus (ii) Interest Expense for such period,
plus (iii) the Provision for Taxes for such period, plus (iv) restructuring
charges for severance, retention, relocation and similar employee payments
incurred during such period, plus (v) non-recurring costs and expenses
incurred during such period in connection with the issuance, extinguishment or
defeasance of Indebtedness of such Person, plus (vi) extraordinary items
and the cumulative effects of a change in accounting principles of such Person
during such period, plus (vii) any loss from discontinued operations of
such Person during such period, plus (viii) other non-recurring charges
incurred by such Person during such period (to the extent approved by Agent in
writing), minus (c) any income from discontinued operations of such Person
during such period (to the extent included in the computation of Consolidated
Net Income of such Person); provided, that, with respect to each
of the amounts described in clauses (b)(iv) through (b)(viii) and (c) above,
Agent shall have received calculations and supporting information relating
thereto, which are in form and substance reasonably satisfactory to Agent.


 


1.46  “EBITDAR”
shall mean, as to any Person, with respect to any period, an amount equal to
(without duplication): (a) the EBITDA of such Person and its Subsidiaries
for such period, plus (b) Consolidated Rental Expense for such period (to
the extent deducted in the computation of Consolidated Net Income of such
Person).


 


9

















 


1.47  “Eligible
Accounts” shall mean Accounts (other than Credit Card Receivables) created by a
Borrower which satisfy and continue to satisfy the criteria set forth below:


 


(a)                                  such
Accounts arise from the actual and bona  fide sale and delivery of
goods by such Borrower or rendition of services by such Borrower in the
ordinary course of its business (including Accounts which arise from any sale
made by any restaurant owned and operated by a Borrower) which transactions are
completed in accordance with the terms and provisions contained in any
documents related thereto;


 


(b)                                 such
Accounts are not unpaid more than thirty (30) (or, solely in the case of
Accounts arising from goods sold or services rendered by a Borrower’s repair
shop, sixty (60)) days after the date of the original invoice for them;


 


(c)                                  such
Accounts comply with the terms and conditions contained in Section 7.2(b) of
this Agreement;


 


(d)                                 such
Accounts do not arise from sales on consignment, guaranteed sale, sale and
return, sale on approval, or other terms under which payment by the account
debtor may be conditional or contingent;


 


(e)                                  the
chief executive office of the account debtor with respect to such Accounts is
located in the United States of America or Canada (provided, that, promptly
upon Agent’s request, such Borrower shall execute and deliver, or cause to be
executed and delivered, such other agreements, documents and instruments as may be
reasonably required by Agent to perfect the security interests of Agent in
those Accounts of an account debtor with its chief executive office or
principal place of business in Canada in accordance with the applicable laws of
the Province of Canada in which such chief executive office or principal place
of business is located and take or cause to be taken such other and further
actions as Agent may reasonably request to enable Agent as secured party
with respect thereto to collect such Accounts under the applicable Federal or
Provincial laws of Canada) or, at Agent’s option, if the chief executive office
and principal place of business of the account debtor with respect to such
Accounts is located other than in the United States of America or Canada, then
if either: (i) the account debtor has delivered to such Borrower an
irrevocable letter of credit issued or confirmed by a bank satisfactory to
Agent and payable only in the United States of America and in U.S. dollars,
sufficient to cover such Account, in form and substance reasonably
satisfactory to Agent and if required by Agent, the original of such letter of
credit has been delivered to Agent or Agent’s agent and the issuer thereof, and
such Borrower has complied with the terms of Section 5.2(f) hereof
with respect to the assignment of the proceeds of such letter of credit to
Agent or naming Agent as transferee beneficiary thereunder, as Agent may specify,
or (ii) such Account is subject to credit insurance payable to Agent
issued by an insurer and on terms and in an amount acceptable to Agent, or (iii) such
Account is otherwise acceptable in all respects to Agent (subject to such
lending formula with respect thereto as Agent may determine);


 


(f)                                    such
Accounts do not consist of progress billings (such that the obligation of the
account debtors with respect to such Accounts is conditioned upon such Borrower’s
satisfactory completion of any further performance under the agreement giving
rise thereto), bill and hold invoices or retainage invoices, except as to bill
and hold invoices, if Agent shall have received an agreement in writing from
the account debtor, in form and substance reasonably 


 


10

















 


satisfactory to Agent, confirming the unconditional obligation of the
account debtor to take the goods related thereto and pay such invoice;


 


(g)                                 the
account debtor with respect to such Accounts has not asserted a counterclaim,
defense or dispute and is not owed or does not claim to be owed any amounts
that may give rise to any right of setoff or recoupment against such
Accounts (but the portion of the Accounts of such account debtor in excess of
the amount at any time and from time to time owed by such Borrower to such
account debtor or claimed owed by such account debtor may be deemed
Eligible Accounts);


 


(h)                                 there
are no facts, events or occurrences which would impair the validity,
enforceability or collectability of such Accounts in any material respect or
reduce the amount payable or delay payment thereunder;


 


(i)                                     such
Accounts are subject to the first priority, valid and perfected security
interest of Agent and any goods giving rise thereto are not, and were not at
the time of the sale thereof, subject to any liens except those permitted under
Sections 9.8(b) and (i) hereof;


 


(j)                                     neither
the account debtor nor any officer or employee of the account debtor with
respect to such Accounts is an officer, employee, agent or other Affiliate of
any Borrower or Guarantor;


 


(k)                                  the
account debtors with respect to such Accounts are not any foreign government,
the United States of America, any State, political subdivision, department,
agency or instrumentality thereof, unless, if the account debtor is the United
States of America, any State, political subdivision, department, agency or instrumentality
thereof, upon Agent’s request, the Federal Assignment of Claims Act of 1940, as
amended or any similar State or local law, if applicable, has been complied
with in a manner satisfactory to Agent;


 


(l)                                     there
are no proceedings or actions known to Agent or any Borrower which are
threatened or pending against the account debtors with respect to such Accounts
which  could reasonably be expected to
result in any material adverse change in any such account debtor’s financial
condition (including, without limitation, any bankruptcy, dissolution,
liquidation, reorganization or similar proceeding);


 


(m)                               the
aggregate amount of such Accounts owing by a single account debtor do not
constitute more than ten (10%) percent of the aggregate amount of all otherwise
Eligible Accounts (but the portion of the Accounts not in excess of such
percentage may be deemed Eligible Accounts);


 


(n)                                 such
Accounts are not owed by an account debtor who has Accounts unpaid more than
thirty (30) (or, solely in the case of Accounts arising from goods sold or
services rendered by a Borrower’s repair shop, sixty (60)) days after the
original invoice date for them which constitute more than fifty (50%) percent
of the total Accounts of such account debtor;


 


(o)                                 the
account debtor is not located in New Jersey, West Virginia, Minnesota or
another state requiring the filing of a Notice of Business Activities Report or
similar report in order to permit such Borrower to seek judicial enforcement in
such State of payment of such 


 


11

















 


Account, unless such Borrower has qualified to do business in such
state or has filed a Notice of Business Activities Report or equivalent report
for the then current year or such failure to file and inability to seek
judicial enforcement is capable of being remedied without any material delay or
material cost;


 


(p)                                 the
sale of goods or the rendition of services giving rise to such Account is not
supported by a performance bond unless the issuer of such bond shall have
waived in writing any rights or interest in and to all Collateral, in form and
substance reasonably satisfactory to Agent;


 


(q)                                 Such
Accounts have been billed and invoiced to the account debtor with respect
thereto, except to the extent that the amount of Accounts which have not been
so billed and invoiced do not exceed twenty five (25%) percent of the Maximum
Credit at any time; provided, that, any such Account shall cease
to be Eligible Accounts unless such Account shall have been billed and invoiced
within seven (7) Business Days after the date such Account is created; and


 


(r)                                    such
Accounts are owed by account debtors deemed creditworthy at all times by Agent
in good faith (such that in the good faith determination of Agent, such an
account debtor does not have, or could reasonably be expected not to have, the
financial ability to satisfy its outstanding Accounts).


 


The criteria for Eligible
Accounts set forth above may only be changed and any new criteria for
Eligible Accounts may only be established by Agent in good faith based on
either: (i) an event, condition or other circumstance arising after the
date hereof, or (ii) an event, condition or other circumstance existing on
the date hereof to the extent Agent has no written notice thereof from a Borrower
prior to the date hereof, in either case under clause (i) or (ii) which
adversely affects or could reasonably be expected to adversely affect the
Accounts in any material respect in the good faith determination of Agent.


 


1.48  “Eligible
Cash Collateral” shall mean the cash or Cash Equivalents (in each case
denominated in United States Dollars) of a Borrower which are: (a) pledged
by such Borrower to Agent pursuant to an agreement in form and substance
reasonably satisfactory to Agent; (b) free and clear of any lien, security
interest, claim or other encumbrance or restriction, except (i) liens in
favor of Agent and (ii) the liens of the financial intermediary holding
such cash or Cash Equivalents to the extent such liens are expressly permitted
by the account control agreement described in clause (d) below, (c) subject
to the first priority, valid and perfected security interest and pledge in
favor of Agent, except (as to priority) for liens in favor of the financial
intermediary holding such cash or Cash Equivalents to the extent such liens are
expressly permitted to have priority by the account control agreement described
in clause (d) below; (d) subject to an account control agreement by
and among the financial intermediary holding such cash or Cash Equivalents,
such Borrower and Agent, in form and substance reasonably satisfactory to
Agent and duly authorized, executed and delivered by such financial
intermediary and such Borrower; and (e) available to such Borrower without
condition or restriction except those arising pursuant to the pledge in favor
of Agent.


 


1.49  “Eligible
Credit Card Receivables” shall mean, as to each Borrower, Credit Card
Receivables of such Borrower which satisfy and continue to satisfy the criteria
set forth below:


 


12

















 


(a)                                  such
Credit Card Receivables arise from the actual and bona fide sale and delivery
of goods or rendition of services by such Borrower in the ordinary course of
the business of such Borrower (including Credit Card Receivables which arise
from any sale made by any restaurant owned and operated by a Borrower) which
transactions are completed in accordance with the terms and provisions
contained in any agreements binding on such Borrower or the other party or
parties related thereto;


 


(b)                                 such
Credit Card Receivables are not past due (beyond any stated applicable grace
period, if any, therefor) pursuant to the terms set forth in the Credit Card
Agreements with the Credit Card Issuer or Credit Card Processor of the credit
card or debit card used in the purchase which give rise to such Credit Card
Receivables;


 


(c)                                  such
Credit Card Receivables are not unpaid more than five (5) Business Days
(or, solely in the case of Credit Card Receivables arising from the use of a
card issued by Comdata Network, Inc. or EFS Transportation Services Inc.,
ten (10)) Business Days) after the date of the sale of inventory or rendition
of services giving rise to such Credit Card Receivables;


 


(d)                                 all
material procedures required by the Credit Card Issuer or the Credit Card
Processor of the credit card or debit card used in the purchase which gave rise
to such Credit Card Receivables shall have been followed by such Borrower and
all documents required for the authorization and approval by such Credit Card
Issuer or Credit Card Processor shall have been obtained in connection with the
sale giving rise to such Credit Card Receivables;


 


(e)                                  the
required authorization and approval by such Credit Card Issuer or Credit Card
Processor shall have been obtained for the sale giving rise to such Credit Card
Receivables;


 


(f)                                    such
Borrower shall have submitted all materials required by the Credit Card Issuer
or Credit Card Processor obligated in respect of such Credit Card Receivables
in order for such Borrower to be entitled to payment in respect thereof;


 


(g)                                 the
Credit Card Issuer or Credit Card Processor obligated in respect of such Credit
Card Receivable has not failed to remit any monthly payment in respect of such
Credit Card Receivable;


 


(h)                                 such
Credit Card Receivables comply with the applicable terms and conditions
contained in Section 7.2 of this Agreement;


 


(i)                                     the
Credit Card Issuer or Credit Card Processor with respect to such Credit Card
Receivables has not asserted a counterclaim, defense or dispute and does not
have, and does not engage in transactions which may give rise to, any
right of setoff against such Credit Card Receivables (other than setoffs for
fees and chargebacks consistent with the practices of such Credit Card Issuer
or Credit Card Processor with such Borrower as of the date hereof or as such
practices may change as a result of changes to the policies of such Credit
Card Issuer or Credit Card Processor applicable to its customers generally and
unrelated to the circumstance of such Borrower), but the portion of the Credit
Card Receivables owing by such Credit Card Issuer or Credit Card Processor in
excess of the amount owing by such Borrower to such Credit Card Issuer or
Credit Card Processor pursuant to such fees, chargebacks, setoffs and
deductions may be deemed Eligible Credit Card Receivables;


 


13

















 


(j)                                     the
Credit Card Issuer or Credit Card Processor with respect to such Credit Card
Receivables has not setoff against amounts otherwise payable by such Credit
Card Issuer or Credit Card Processor to such Borrower for the purpose of
establishing a reserve or collateral for obligations of such Borrower to such
Credit Card Issuer or Credit Card Processor (notwithstanding the foregoing the Credit
Card Issuer or Credit Card Processor may have setoffs for fees and
chargebacks consistent with the practices of such Credit Card Issuer or Credit
Card Processor with such Borrower as of the date hereof or as such practices may hereafter
change as a result of changes to the policies of such Credit Card Issuer or
Credit Card Processor applicable to its customers generally and unrelated to
the circumstances of such Borrower);


 


(k)                                  there
are no facts, events or occurrences which would impair the validity, enforceability
or collectability of such Credit Card Receivables in any material respect or
reduce the amount payable or delay payment thereunder (other than for setoffs
for fees and chargebacks consistent with the practices of such Credit Card
Issuer or Credit Card Processor with such Borrower as of the date hereof or as
such practices may hereafter change as a result of changes to the policies
of such Credit Card Issuer or Credit Card Processor applicable to its customers
generally and unrelated to the circumstances of such Borrower or any
Guarantor);


 


(l)                                     such
Credit Card Receivables are subject to the first priority, valid and perfected
security interest and lien of Agent, for and on behalf of itself and Lenders,
and any goods giving rise thereto are not, and were not at the time of the sale
thereof, subject to any security interest or lien in favor or any person other
than Agent except as otherwise permitted in this Agreement, in each case
subject to and in accordance with the terms and conditions applicable hereunder
to any such permitted security interest or lien;


 


(m)                               there
are no proceedings or actions known to Agent or any Borrower which are pending
or threatened against the Credit Card Issuers or Credit Card Processors with
respect to such Credit Card Receivables which could reasonably be expected to
result in any material adverse change in the financial condition of any such
Credit Card Issuer or Credit Card Processor;


 


(n)                                 such
Credit Card Receivables are owed by Credit Card Issuers or Credit Card Processor
deemed creditworthy at all times by Agent in good faith (such that in the good
faith determination of Agent, such Credit Card Issuer or Credit Card Processor
does not have, or could reasonably be expected not to have, the financial
ability to satisfy its outstanding Accounts);


 


(o)                                 no
event of default has occurred and is continuing under the Credit Card Agreement
of such Borrower with the Credit Card Issuer or Credit Card Processor who has
issued the credit card or debit card or handles payments under the credit card
or debit card used in the sale which gave rise to such Credit Card Receivables
which event of default gives such Credit Card Issuer or Credit Card Processor
the right to cease or suspend payment to such Borrower or any Guarantor and no
event shall have occurred which gives such Credit Card Issuer or Credit Card
Processor the right to setoff against amounts otherwise payable to such
Borrower, including on behalf of a Guarantor (other than for then current fees
and chargebacks consistent with the current practices of such Credit Card
Issuer or Credit Card Processor as of the date hereof or as such practices may hereafter
change as a result of changes to the policies of such Credit Card Issuer or
Credit Card Processor applicable to its customers generally and unrelated to
the circumstances of such Borrower or any Guarantor), except as may have
been 


 


14

















 


waived in writing on terms and conditions reasonably satisfactory to
Agent pursuant to the Credit Card Acknowledgement by such Credit Card Issuer or
Credit Card Processor), or the right to establish reserves or establish or
demand collateral, and the Credit Card Issuer or Credit Card Processor has not
sent any written notice of default and/or notice of its intention to cease or
suspend payments to such Borrower in respect of such Credit Card Receivables or
to establish reserves or cash collateral for obligations of such Borrower to
such Credit Card Issuer or Credit Card Processor, and such Credit Card
Agreements are otherwise in full force and effect and constitute the legal,
valid, binding and enforceable obligations of the parties thereto;


 


(p)                                 Agent
shall have received, in form and substance satisfactory to Agent in good
faith, a Credit Card Acknowledgment duly authorized, executed and delivered by
the Credit Card Issuer (except as Agent may otherwise agree) or Credit
Card Processor for the credit card or debit card used in the sale which gave
rise to such Credit Card Receivable (except as Agent may otherwise agree),
such Credit Card Acknowledgment shall be in full force and effect and the
Credit Card Issuer or Credit Card Processor party thereto shall be in
compliance with the terms thereof;


 


(q)                                 the
terms of the sale giving rise to such Credit Card Receivables and all practices
of such Borrower and Guarantors with respect to such Credit Card Receivables
comply in all material respects with applicable Federal, State, and local laws
and regulations; and


 


(r)                                    the
customer using the credit card or debit card giving rise to such Credit Card
Receivable shall not have returned the merchandise purchased giving rise to
such Credit Card Receivable.


 


Credit Card Receivables
which would otherwise constitute Eligible Credit Card Receivables pursuant to
this Section will not be deemed ineligible solely by virtue of the Credit
Card Agreements with respect thereto having been entered into by any Guarantor,
for the benefit of Borrowers. General criteria for Eligible Credit Card
Receivables may only be changed and any new criteria for Eligible Credit
Card Receivables may only be established by Agent in good faith based on
either: (i) an event, condition or other circumstance arising after the
date hereof, or (ii) existing on the date hereof, in either case under clause
(i) or (ii) which adversely affects or could reasonably be expected
to adversely affect the Credit Card Receivables in any material respect in the
good faith determination of Agent.


 


1.50  “Eligible Equipment” shall mean, as to each
Borrower, Equipment owned by such Borrower and included in an appraisal of
Equipment received by Agent in accordance with the requirements of this
Agreement, which Equipment is in good order, repair, running and marketable
condition (ordinary wear and tear excepted) and in each case acceptable to
Agent in good faith based on the criteria set forth below. In general, Eligible
Equipment shall not include (a) Equipment at premises other than those
owned or leased and controlled by any Borrower, except any Equipment which
would otherwise be deemed Eligible Equipment that is not located at premises
owned and operated by any Borrower may nevertheless be considered Eligible
Equipment: as to locations which are leased by a Borrower if either Agent shall
have received a Collateral Access Agreement from the owner and lessor of such
location, duly authorized, executed and delivered by such owner and lessor or
Agent shall have established such Reserves in respect of amounts at any time
payable by any Borrower or its affiliates to the owner and lessor thereof as
Agent shall determine in good faith (it being understood that the Letter
Agreements, dated even date herewith, by HPT and/or certain of its affiliates
in favor of Agent 


 


15

















 


shall not been deemed to
be satisfactory Collateral Access Agreements for purposes of this clause (a)); (b) Equipment
subject to a security interest or lien in favor of any person other than Agent
except those permitted hereunder that are subject to an intercreditor agreement
in form and substance  reasonably
satisfactory to Agent between the holder of such security interest or lien and
Agent); (c) Equipment located outside the United States of America; (d) Equipment
that is not subject to the first priority, valid and perfected security
interest of Agent; (e) damaged or defective Equipment or Equipment not
used or usable in the ordinary course of such Borrower’s business as presently
conducted; (f) office equipment or motor vehicles; or (g) Equipment
which constitutes fixtures. The criteria for Eligible Equipment set forth above
may only be changed and any new criteria for Eligible Equipment may only
be established by Agent acting in good faith based on either: (i) an
event, condition or other circumstance arising after the date hereof, or (ii) an
event, condition or other circumstance existing on the date hereof to the
extent Agent has no written notice thereof from any Borrower prior to the date
hereof, in either case under clause (i) or (ii) which adversely
affects or could reasonably be expected to adversely affect such Equipment in
any material respect in the good faith determination of Agent.


 


1.51  “Eligible
Inventory” shall mean, as to each Borrower, Inventory of such Borrower
consisting of finished goods (including gasoline and diesel fuel) held for
resale in the ordinary course of the business of such Borrower that are
acceptable to Agent based on the criteria set forth below. In general, Eligible
Inventory shall not include (a) any inventory sold or intended to be sold
by any restaurant owned or operated by any Borrower or Guarantor; (b) components
which are not part of finished goods; (c) spare parts for equipment; (d) packaging
and shipping materials; (e) supplies used or consumed in such Borrower’s
business; (f) Inventory at premises other than those owned or leased and
controlled by any Borrower, except any Inventory which would otherwise be
deemed Eligible Inventory that is not located at premises owned and operated by
any Borrower may nevertheless be considered Eligible Inventory as to
locations which are leased by a Borrower, if either Agent shall have received a
Collateral Access Agreement from the owner and lessor of such location, duly
authorized, executed and delivered by such owner and lessor or Agent shall have
established such Reserves in respect of amounts at any time payable by any
Borrower or its affiliates to the owner and lessor thereof as Agent shall
determine in good faith; (g) Inventory subject to a security interest or
lien in favor of any Person other than Agent except those permitted in this
Agreement that are subject to an intercreditor agreement in form and
substance reasonably satisfactory to Agent between the holder of such security
interest or lien and Agent; (h) bill and hold goods; (i) unserviceable,
obsolete or slow moving Inventory; (j) Inventory that is not subject to the
first priority, valid and perfected security interest of Agent; (k) returned,
damaged and/or defective Inventory; (l) Inventory purchased or sold on
consignment; (m) Inventory located outside the United States of America; (n)
Inventory which is subject to or uses a trademark or other intellectual
property licensed by a third party to a Borrower unless either (i) Agent
shall have received an agreement, in form and substance reasonably
satisfactory to Agent, from such third party licensor in favor of Agent, duly
authorized, executed and delivered by such Borrower and such third party
licensor or (ii) Agent shall have otherwise determined that Agent has the
right to sell such Inventory; and (o) inventory (excluding shop inventory)
which is not tracked on a perpetual reporting system reasonably satisfactory to
Agent. The criteria for Eligible Inventory set forth above may only be
changed and any new criteria for Eligible Inventory may only be
established by Agent in good faith based on either: (i) an event,
condition or other circumstance arising after the date hereof, or (ii) an
event, condition or other circumstance existing on the date hereof to the
extent Agent has no written notice thereof from a Borrower prior to the date
hereof, in either case under clause (i) or 


 


16

















 


(ii) which adversely
affects or could reasonably be expected to adversely affect the Inventory in
any material respect in the good faith determination of Agent.


 


1.52  “Eligible
Real Property” shall mean, as to each Borrower, Real Property owned by such
Borrower in fee simple and included in an appraisal of such Real Property
received by Agent in accordance with the requirements of this Agreement and in
each case acceptable to Agent in good faith based on the criteria set forth
below. Eligible Real Property shall not include: (a) Real Property which
is not owned and operated by a Borrower; (b) Real Property subject to a
security interest, lien or mortgage or other encumbrance in favor of any person
other than Agent, except those permitted under Sections 9.8(b), (d) and (i) hereof;
(c) Real Property that is not located in the United States of America; (d) Real
Property that is not subject to the valid and enforceable, first priority,
perfected security interest, lien and mortgage of Agent; (e) Real Property
where Agent determines that issues relating to compliance with Environmental
Laws materially adversely affect the value thereof or the ability of Agent to
sell or otherwise dispose thereof (but subject to the right of Agent to
establish Reserves after the date hereof to reflect such material adverse
affect); (f) except as Agent may otherwise determine, Real Property
improvements located on land which is not owned in fee simple by such Borrower;
and (g) Real Property improved with residential housing. The criteria for
Eligible Real Property set forth above may only be changed and any new
criteria for Eligible Real Property may only be established by Agent
acting in good faith based on either: (1) an event, condition or other
circumstance arising after the date hereof, or (2) an event, condition or
other circumstance existing on the date hereof to the extent Agent has no
written notice thereof from any Borrower prior to the date hereof, in either
case under clause (i) or (ii) which adversely affects or could
reasonably be expected to adversely affect such Real Property in any material
respect in the good faith determination of Agent.


 


1.53  “Eligible
Transferee” shall mean (a) any Lender; (b) the parent company of any
Lender and/or any Affiliate of such Lender which is at least fifty (50%)
percent owned by such Lender or its parent company; (c) any person (whether
a corporation, partnership, trust or otherwise) that is engaged in the business
of making, purchasing, holding or otherwise investing in bank loans and similar
extensions of credit in the ordinary course of its business and is administered
or managed by a Lender or with respect to any Lender that is a fund which
invests in bank loans and similar extensions of credit, any other fund that
invests in bank loans and similar extensions of credit and is managed by the
same investment advisor as such Lender or by an Affiliate of such investment
advisor, and in each case is approved by Agent; and (d) any other
commercial bank, financial institution or “accredited investor” (as defined in
Regulation D under the Securities Act of 1933) approved by Agent (which approval
shall not be unreasonably withheld or delayed), provided, that, (i) in
the case of any assignment to an Eligible Transferee described under clauses (c) and
(d) above, Administrative Borrower shall have the right to approve the
assignee under such assignment, such approval not to be unreasonably withheld,
conditioned or delayed by Administrative Borrower, except, that, Administrative
Borrower’s approval shall not be required (A) after the occurrence and
during the continuance of an Event of Default, or (B) in connection with
an assignment by Lender upon the merger, consolidation, sale of such Lender or
other disposition of all or any portion of any Lender’s business, loan
portfolio or other assets, (ii) neither any Borrower nor any Guarantor or
any Affiliate of any Borrower or Guarantor shall qualify as an Eligible
Transferee and (iii) no Person to whom any Indebtedness which is in any
way subordinated in right of payment to any other Indebtedness of any Borrower 


 


17

















 


or Guarantor shall
qualify as an Eligible Transferee, except as Agent may otherwise
specifically agree.


 


1.54  “Environmental
Laws” shall mean all foreign, Federal, State and local laws (including common
law), legislation, rules, codes, licenses, permits (including any conditions
imposed therein), authorizations, judicial or administrative decisions,
injunctions or agreements between any Borrower or Guarantor and any
Governmental Authority, (a) relating to pollution and the protection,
preservation or restoration of the environment (including air, water vapor,
surface water, ground water, drinking water, drinking water supply, surface
land, subsurface land, plant and animal life or any other natural resource), or
to human health or safety, (b) relating to the exposure to, or the use,
storage, recycling, treatment, generation, manufacture, processing,
distribution, transportation, handling, labeling, production, release or
disposal, or threatened release, of Hazardous Materials, or (c) relating
to all laws with regard to recordkeeping, notification, disclosure and
reporting requirements respecting Hazardous Materials. The term “Environmental
Laws” includes (i) the Federal Comprehensive Environmental Response,
Compensation and Liability Act of 1980, the Federal Superfund Amendments and
Reauthorization Act, the Federal Water Pollution Control Act of 1972, the
Federal Clean Water Act, the Federal Clean Air Act, the Federal Resource
Conservation and Recovery Act of 1976 (including the Hazardous and Solid Waste
Amendments thereto), the Federal Solid Waste Disposal and the Federal Toxic
Substances Control Act, the Federal Insecticide, Fungicide and Rodenticide Act,
and the Federal Safe Drinking Water Act of 1974, (ii) applicable state
counterparts to such laws and (iii) any common law or equitable doctrine
that may impose liability or obligations for injuries or damages due to,
or threatened as a result of, the presence of or exposure to any Hazardous
Materials.


 


1.55  “Equipment”
shall mean, as to each Borrower and Guarantor, all of such Borrower’s and
Guarantor’s now owned and hereafter acquired equipment, wherever located,
including machinery, data processing and computer equipment (whether owned or
licensed and including embedded software), vehicles, tools, furniture,
fixtures, all attachments, accessions and property now or hereafter affixed
thereto or used in connection therewith, and substitutions and replacements
thereof, wherever located.


 


1.56  “Equipment
Availability” shall mean (a) prior to the date on which the Equipment
Availability Conditions have been satisfied, zero (0), and (b) from and
after the date on which the Equipment Availability Conditions have been
satisfied as reasonably determined by Agent, the amount equal to eighty five
(85%) percent of the net liquidation value of the Eligible Equipment as set
forth in the most recent acceptable appraisal of such Equipment received by
Agent in accordance with the terms hereof (net of liquidation expenses, costs
and commissions): provided, that, the Equipment Availability
shall be reduced on the first day of each calendar quarter, commencing with the
first full calendar quarter following the date on which the Equipment
Availability Conditions have been satisfied, by an amount equal to the initial
Equipment Availability Calculated in accordance with this clause (b) divided
by twenty (20).


 


1.57  “Equipment
Availability Conditions” shall mean, collectively, the following:  (a) Agent shall have received a written
request from Administrative Borrower to include the Equipment Availability in
the Borrowing Base (which request shall be irrevocable); and (b) Agent
shall have received a written appraisal as to each item of Equipment
constituting Eligible Equipment, which shall be in form, scope and methodology satisfactory
to Agent and by an 


 


18

















 


appraiser acceptable to
Agent and which shall be addressed to Agent and shall reveal results acceptable
to Agent.


 


1.58  “ERISA”
shall mean the Employee Retirement Income Security Act of 1974, together with
all rules, regulations and interpretations thereunder or related thereto.


 


1.59  “ERISA
Affiliate” shall mean any person required to be aggregated with any Borrower,
any Guarantor or any of its or their respective Subsidiaries under Sections
414(b), 414(c), 414(m) or 414(o) of the Code.


 


1.60  “ERISA
Event” shall mean (a) any “reportable event”, as defined in Section 4043(c) of
ERISA or the regulations issued thereunder, with respect to a Plan for which
the Pension Benefit Guaranty Corporation notice requirement has not been
waived; (b) the adoption of any amendment to a Plan that would require the
provision of security pursuant to Section 401(a)(29) of the Code or Section 307
of ERISA; (c) the existence with respect to any Plan of an “accumulated
funding deficiency” (as defined in Section 412 of the Code or Section 302
of ERISA), whether or not waived; (d) the filing pursuant to Section 412
of the Code or Section 303(d) of ERISA of an application for a waiver
of the minimum funding standard with respect to any Plan; (e) the
occurrence of a “prohibited transaction” with respect to which any Borrower,
Guarantor or any of its or their respective Subsidiaries is a “disqualified
person” (within the meaning of Section 4975 of the Code) or with respect
to which any Borrower, Guarantor or any of its or their respective Subsidiaries
could otherwise be liable; (f) a complete or partial withdrawal by any
Borrower, Guarantor or any ERISA Affiliate from a Multiemployer Plan or a
cessation of operations which is treated as such a withdrawal or notification
that a Multiemployer Plan is in reorganization; (g) 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 Pension Benefit Guaranty Corporation to terminate a Plan; (h) 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 Plan; (i) the imposition of any liability
under Title IV of ERISA, other than the Pension Benefit Guaranty Corporation
premiums due but not delinquent under Section 4007 of ERISA, upon any
Borrower, Guarantor or any ERISA Affiliate in excess of $1,500,000 and (j) any
other event or condition with respect to a Plan including any Plan subject to
Title IV of ERISA maintained, or contributed to, by any ERISA Affiliate that
could reasonably be expected to result in liability of any Borrower in excess
of $1,500,000 (other than the funding of benefits in accordance with the terms
of such Plan).


 


1.61  “Eurodollar
Rate Loans” shall mean any Loans or portion thereof on which interest is
payable based on the Adjusted Eurodollar Rate in accordance with the terms
hereof.


 


1.62  “Event of
Default” shall mean the occurrence or existence of any event or condition
described in Section 10.1 hereof.


 


1.63  “Excess
Availability” shall mean the amount, as determined by Agent, calculated at any
date, equal to: (a) the lesser of: (i) the Borrowing Base and (ii) the
Maximum Credit (in each case under (i) or (ii) after giving effect to
any Reserves), minus (b) the sum of: (i) the amount of all
then outstanding Revolving Loans, plus (ii) the amount of all then
outstanding Letter of Credit Accommodations.


 


19

















 


1.64  “Exchange
Act” shall mean the Securities Exchange Act of 1934, together with all rules,
regulations and interpretations thereunder or related thereto.


 


1.65  “Excluded
Assets” shall mean (a) Petro’s accounts receivable and contract rights
which (in each case) represent the right to payments in respect of credit card
receivables paid to Petro by Comdata Network, Inc. under the Agreement,
dated as of March 3, 1999, by and between Petro and Comdata Network, Inc.
(the “1999 Comdata Agreement”), except that the assets described in this clause
(a) shall not constitute Excluded Assets if (i) the prohibition on
granting liens on such assets contained in the 1999 Comdata Agreement is
unenforceable under the UCC or other applicable law or (ii) such
prohibition is terminated, waived or otherwise ceases to be effective, (b) Real
Property, except that any Real Property, automatically and without any further
action, shall cease to be Excluded Assets and shall be subject to the security
interest and lien of Agent at such time as such Real Property shall be included
in the calculation of the Borrowing Base, (c) commercial tort claims other
than commercial tort claims that arise in connection with or are related to any
assets which are or at any time were included in the calculation of the
Borrowing Base, (d) investment property consisting of Capital Stock in any
Person which is (i) not publicly listed unless such Person is a direct
Subsidiary of a Borrower or Guarantor, or (ii) an Excluded Subsidiary, (e) the
Customer Loyalty Account Assets and (f) all proceeds of the foregoing.


 


1.66  “Excluded
Subsidiary” shall mean (a) each Subsidiary of Parent listed on Schedule 1.66
hereto and (b) a Subsidiary of Parent formed or acquired after the date
hereof, which is designated as an “Excluded Subsidiary” in writing by Parent to
Agent after the date hereof and which is not a Borrower, Guarantor or Specified
Subsidiary.


 


1.67  “Existing
HPT Leases” shall mean, collectively, (a) the Lease Agreement, dated as of
January 31, 2007, by and among HPT TA Properties Trust, HPT TA Properties
LLC and TA Leasing, as modified by the Letter Agreement, dated  even date herewith, by and among HPT TA
Properties Trust, HPT TA Properties LLC, Borrowers, Guarantors and Agent, and (b) the
Lease Agreement dated as of May 30, 2007, by and among HPT PSC Properties
Trust, HPT PSC Properties LLC and Petro Shopping Centers, L.P., as modified by
the Letter Agreement, dated even date herewith, by and among HPT PSC Properties
Trust, HPT PSC Properties LLC, Borrowers, Guarantors and Agent, in each case as
the same now exist or may hereafter be amended, modified, supplemented,
extended, renewed, restated or replaced.


 


1.68  “ExxonMobil”
shall mean, collectively, ExxonMobil Oil Corporation and Mobil Diesel Supply
Corporation.


 


1.69  “Fee
Letter” shall mean the letter agreement, dated of even date herewith, by and
among Borrowers and Agent, setting forth certain fees payable by Borrowers to
Agent for the benefit of itself and Lenders, as the same now exists or may hereafter
be amended, modified, supplemented, extended, renewed, restated or replaced.


 


1.70  “Financing
Agreements” shall mean, collectively, this Agreement and all notes, guarantees,
security agreements, deposit account control agreements, investment property
control agreements, intercreditor agreements and all other agreements,
documents and instruments now or at any time hereafter executed and/or delivered
by any Borrower or Obligor in connection with this Agreement; provided, that,
the Financing Agreements shall not include Hedge Agreements.


 


20

















 


1.71  “Fixed
Asset Availability” shall mean the amount equal to the lesser of (a) the
sum of the Equipment Availability and the Real Property Availability or (b) the
Fixed Asset Availability Limit.


 


1.72  “Fixed
Asset Availability Limit” shall mean, at any time, the amount equal to twenty
(20%) percent of the Maximum Credit.


 


1.73  “Fixed
Charge Coverage Ratio” shall mean, as to any Person, with respect to any
period, the ratio of (a) the amount equal to (i) the EBITDAR of such
Person for such period, minus (ii) all Capital Expenditures of such Person
during such period to the extent such Capital Expenditures are not financed
with the proceeds of (A) Indebtedness permitted under Section 9.9
hereof or (B) amounts paid by any landlord to Borrowers pursuant to any
Lease Agreement for the purpose of financing such Capital Expenditures (or
reimbursing Borrowers for such Capital Expenditures), minus (iii) taxes
paid during such period in cash, to (b) the Fixed Charges of such Person
for such period.


 


1.74  “Fixed
Charges” shall mean, as to any Person, with respect to any period, the sum of,
without duplication, (a) all Interest Expense during such period (other
than interest payments in respect of Indebtedness under the Petro Indenture to
the extent such Interest Expense is paid with the proceeds of the Petro
Indenture Cash Collateral), plus (b) all regularly scheduled (as
determined at the beginning of the respective period) principal payments in
respect of (i) Indebtedness for borrowed money (other than (A) payments
in respect of Revolving Loans which do not result in a reduction of the
Commitments and (B) payments in respect of the principal amount of
Indebtedness under the Petro Indenture to the extent such principal payments
are paid with the proceeds of the Petro Indenture Cash Collateral) and (ii) Indebtedness
with respect to Capital Leases (and without duplicating items (a) and (b) of
this definition, the interest component with respect to Indebtedness under
Capital Leases) during such period, plus (c) all Consolidated Rental
Expense paid in cash during such Period, plus (d) all dividends paid (or
deemed to have been paid) by Parent during such period pursuant to Section 9.11(c) hereof.


 


1.75  “Foreign
Subsidiary” shall mean any Subsidiary of a Borrower or Guarantor which is
incorporated or formed under the laws of a jurisdiction outside the United
States of America.


 


1.76  “Freightliner
Agreement” shall mean the Freightliner Express Operating Agreement, dated as of
July 21, 1999, by and among Freightliner Corporation, TA Operating
Corporation (as predecessor in interest to TA Operating) and TA Franchise
Systems, Inc. (as predecessor in interest to TA Franchise Systems LLC), as
amended by Amendment No. 1 to Operating Agreement dated as of November 9,
2000, Amendment No. 2 to Operating Agreement dated as of April 15,
2003 and Amendment No. 3 to Operating Agreement dated as of July 26,
2006 and as the same may hereafter be amended, modified, supplemented,
extended, renewed, restated or replaced.


 


1.77  “Fuel
Inventory Loan Limit” shall mean twenty (20%) percent of the Maximum Credit.


 


1.78  “GAAP”
shall mean generally accepted accounting principles in the United States of
America as in effect from time to time as set forth in the opinions and
pronouncements of the Accounting Principles Board and the American Institute of
Certified Public Accountants 


 


21

















 


and the statements and
pronouncements of the Financial Accounting Standards Board which are applicable
to the circumstances as of the date of determination consistently applied,
except that, for purposes of Section 9.17 hereof, GAAP shall be determined
on the basis of such principles in effect on the date hereof and consistent
with those used in the preparation of the most recent audited financial
statements delivered to Agent prior to the date hereof.


 


1.79  “Governmental
Authority” shall mean any nation or government, any state, province, or other
political subdivision thereof, any central bank (or similar monetary or
regulatory authority) thereof, and any entity exercising executive,
legislative, judicial, regulatory or administrative functions of or pertaining
to government.


 


1.80  “Hazardous
Materials” shall mean any hazardous, toxic or dangerous substances, materials
and wastes, including hydrocarbons (including naturally occurring or man-made
petroleum and hydrocarbons), flammable explosives, asbestos, urea formaldehyde
insulation, radioactive materials, biological substances, polychlorinated
biphenyls, pesticides, herbicides and any other kind and/or type of pollutants
or contaminants (including materials which include hazardous constituents),
sewage, sludge, industrial slag, solvents and/or any other similar substances,
materials, or wastes and including any other substances, materials or wastes
that are or become regulated under any Environmental Law (including any that
are or become classified as hazardous or toxic under any Environmental Law).


 


1.81  “Hedge
Agreement” shall mean an agreement between any Borrower or Guarantor and a Bank
Product Provider that is a rate swap agreement, basis swap, forward rate
agreement, interest rate option, forward foreign exchange agreement, spot
foreign exchange agreement, rate cap agreement, rate floor agreement, rate
collar agreement, currency swap agreement, cross-currency rate swap agreement,
currency option, any other similar agreement (including any option to enter
into any of the foregoing or a master agreement for any of the foregoing
together with all supplements thereto) for the purpose of protecting against or
managing exposure to fluctuations in interest or exchange rates or currency
valuations, but not for the purpose of protecting against or managing exposure
to fluctuations in commodity prices; sometimes being collectively referred to
herein as “Hedge Agreements.”


 


1.82  “HPT”
shall mean Hospitality Properties Trust, a Maryland real estate investment
trust, and its successors and assigns.


 


1.83  “HPT
Companies” shall mean the collective reference to HPT and its Subsidiaries; provided,
that, in no event shall the HPT Companies include any Borrower or
Guarantor or any of their respective Subsidiaries.


 


1.84  “Indebtedness”
shall mean, with respect to any Person, any liability, whether or not
contingent, (a) in respect of borrowed money (whether or not the recourse
of the lender is to the whole of the assets of such Person or only to a portion
thereof) or evidenced by bonds, notes, debentures or similar instruments; (b) representing
the balance deferred and unpaid of the purchase price of any property or
services (except any such balance that constitutes an account payable to a
trade creditor (whether or not an Affiliate) created, incurred, assumed or
guaranteed by such Person in the ordinary course of business of such Person in
connection with obtaining goods, materials or services payable in accordance
with customary trade practices; (c) all obligations as lessee under leases
which have been, or should be, in accordance with GAAP recorded as Capital
Leases; (d) any contractual obligation, contingent or otherwise, of such 


 


22

















 


Person to pay or be
liable for the payment of any indebtedness described in this definition of
another Person, including, without limitation, any such indebtedness, directly
or indirectly guaranteed, or any agreement to purchase, repurchase, or
otherwise acquire such indebtedness, obligation or liability or any security
therefore, or to provide funds for the payment or discharge thereof, or to
maintain solvency, assets, level of income, or other financial condition; (e) all
obligations with respect to redeemable stock and redemption or repurchase
obligations under any Capital Stock or other equity securities issued by such
Person; (f) without duplication, all reimbursement obligations and other
liabilities of such Person with respect to surety bonds (whether bid,
performance or otherwise), letters of credit, banker’s acceptances, drafts or
similar documents or instruments issued for such Person’s account; (g) all
indebtedness of such Person in respect of indebtedness of another Person for
borrowed money or indebtedness of another Person otherwise described in this
definition which is secured by any consensual lien, security interest,
collateral assignment, conditional sale, mortgage, deed of trust, or other
encumbrance on any asset of such Person, whether or not such obligations,
liabilities or indebtedness are assumed by or are a personal liability of such
Person, all as of such time; (h) all obligations, liabilities and
indebtedness of such Person (marked to market) arising under swap agreements,
cap agreements and collar agreements and other agreements or arrangements
designed to protect such person against fluctuations in interest rates or
currency or commodity values; (i) all obligations owed by such Person
under License Agreements with respect to non-refundable, advance or minimum
guarantee royalty payments; and (j) the principal and interest portions of all
rental obligations of such Person under any synthetic lease or similar off-balance
sheet financing where such transaction is considered to be borrowed money for
tax purposes but is classified as an operating lease in accordance with GAAP.


 


1.85  “Information
Certificate” shall mean, collectively, the Information Certificates of
Borrowers and Guarantors constituting Exhibit B hereto containing material
information with respect to Borrowers and Guarantors, their respective
businesses and assets provided by or on behalf of Borrowers and Guarantors to
Agent in connection with the preparation of this Agreement and the other
Financing Agreements and the financing arrangements provided for herein.


 


1.86  “Intellectual
Property” shall mean, as to each Borrower and Guarantor, such Borrower’s and
Guarantor’s now owned and hereafter arising or acquired:  patents, patent rights, patent applications,
copyrights, works which are the subject matter of copyrights, copyright
applications, copyright registrations, trademarks, trade names, trade styles,
trademark and service mark applications, and licenses and rights to use any of the
foregoing; all extensions, renewals, reissues, divisions, continuations, and
continuations-in-part of any of the foregoing; all rights to sue for past,
present and future infringement of any of the foregoing; inventions, trade
secrets, formulae, processes, compounds, drawings, designs, blueprints,
surveys, reports, manuals, and operating standards; goodwill (including any
goodwill associated with any trademark or the license of any trademark);
customer and other lists in whatever form maintained; trade secret rights,
copyright rights, rights in works of authorship, domain names and domain name
registration; software and contract rights relating to computer software
programs, in whatever form created or maintained.


 


1.87  “Interest
Expense” shall mean, for any period, as to any Person, as determined in
accordance with GAAP, the total interest expense of such Person and its
Subsidiaries, whether paid or accrued during such period (including the
interest component of 


 


23

















 


Capital Leases for such
period), including, without limitation, discounts in connection with the sale
of any Accounts, and bank fees, commissions, discounts and other fees and
charges owed with respect to letters of credit, banker’s acceptances or similar
instruments, but excluding interest paid in property other than cash during
such period.


 


1.88  “Interest
Period” shall mean for any Eurodollar Rate Loan, a period of approximately one
(1), two (2), three (3) or six (6) months duration as any Borrower
(or Administrative Borrower on behalf of such Borrower) may elect, the
exact duration to be determined in accordance with the customary practice in
the applicable Eurodollar Rate market; provided, that, such
Borrower (or Administrative Borrower on behalf of such Borrower) may not
elect an Interest Period which will end after the last day of the then-current
term of this Agreement.


 


1.89  “Interest
Rate” shall mean,


 


(a)                                  Subject
to clause (b) of this definition below:


 


(i)                                     as
to Prime Rate Loans, a rate equal to the then Applicable Margin for Prime Rate
Loans on a per annum basis plus the Prime Rate, and


 


(ii)                                  as
to Eurodollar Rate Loans, a rate equal to the then Applicable Margin for
Eurodollar Rate Loans on a per annum basis plus the Adjusted Eurodollar Rate
(in each case, based on the London Interbank Offered Rate applicable for the
Interest Period as in effect two (2) Business Days prior to the
commencement of such Interest Period, whether such rate is higher or lower than
any rate previously selected by a Borrower).


 


(b)                                 Notwithstanding
anything to the contrary contained herein, Agent may, at its option, and Agent
shall, at the direction of the Required Lenders, increase the Applicable Margin
otherwise used to calculate the Interest Rate for Prime Rate Loans and
Eurodollar Rate Loans in each case to the highest percentage set forth in the
definition of the term Applicable Margin for each category of Revolving Loans
(without regard to the amount of Monthly Average Adjusted Excess Availability)
plus two (2%) percent per annum: (i) for the period (A) from and
after the effective date of termination or non-renewal hereof until Agent and
Lenders have received full and final payment of all outstanding and unpaid
Obligations in immediately available funds and (B) from and after the date
of the occurrence of an Event of Default and for so long as such Event of
Default is continuing and (ii) on Revolving Loans at any time outstanding
in excess of the Borrowing Base (whether or not such excess(es) arise or are made
with or without the knowledge or consent of Agent or any Lender and whether
made before or after an Event of Default).


 


1.90  “Inventory”
shall mean, as to each Borrower and Guarantor, all of such Borrower’s and
Guarantor’s now owned and hereafter existing or acquired goods, wherever
located, which (a) are leased by such Borrower or Guarantor as lessor; (b) are
held by such Borrower for sale or lease or to be furnished under a contract of
service; (c) are furnished by such Borrower or Guarantor under a contract
of service; or (d) consist of raw materials, work in process, finished
goods or materials used or consumed in its business.


 


1.91  “Inventory
Loan Limit” shall mean fifty (50%) percent of the Maximum Credit.


 


24






 












 


1.92  “Investment
Property Control Agreement” shall mean an agreement in writing, in form and
substance reasonably satisfactory to Agent, by and among Agent, any Borrower or
Guarantor (as the case may be) and any securities intermediary, commodity
intermediary or other person who has custody, control or possession of any
investment property of such Borrower or Guarantor.


 


1.93  “Lease
Agreement” shall mean any Existing HPT Lease or any other lease agreement
entered into by a Borrower or Guarantor or Specified Subsidiary pursuant to
which such Borrower or Guarantor or Specified Subsidiary leases Real Property
(and related personal property) from any other Person.


 


1.94  “Lenders”
shall mean the financial institutions who are signatories hereto as Lenders and
other persons made a party to this Agreement as a Lender in accordance with
Section 13.7 hereof, and their respective successors and assigns; each
sometimes being referred to herein individually as a “Lender”.


 


1.95  “Letter of
Credit Accommodations” shall mean, collectively,  the letters of credit, merchandise purchase
or other guaranties which are from time to time either (a) issued or opened by
Agent or any Lender for the account of any Borrower or Obligor or (b) with
respect to which Agent or Lenders have agreed to indemnify the issuer or
guaranteed to the issuer the performance by any Borrower or Obligor of its
obligations to such issuer; sometimes being referred to herein individually as “Letter
of Credit Accommodation”.


 


1.96  “License
Agreements” shall have the meaning set forth in Section 8.11 hereof.


 


1.97  “Loans”
shall mean the Revolving Loans.


 


1.98  “London
Interbank Offered Rate” shall mean, with respect to any Eurodollar Rate Loan
for the Interest Period applicable thereto, the rate of interest per annum
(rounded upwards, if necessary, to the nearest 1/100 of 1%) appearing on
Reuters Screen LIBO Page (or any successor page) as the London interbank
offered rate for deposits in U.S. Dollars at approximately 11:00 A.M. (London
time) two (2) Business Days prior to the first day of such Interest Period for
a term comparable to such Interest Period; provided, that, if more than one
rate is specified on Reuters Screen LIBO Page, the applicable rate shall be the
arithmetic mean of all such rates.


 


1.99  “Material
Adverse Effect” shall mean a material adverse effect on (a) the financial
condition, business, performance or operations of Borrowers and Guarantors
(taken as a whole); (b) the legality, validity or enforceability of this
Agreement or any of the other Financing Agreements; (c) the legality, validity,
enforceability, perfection or priority of the security interests and liens of
Agent upon the Collateral; (d) the ability of Borrowers to repay the
Obligations or of any Borrower to perform its obligations under this Agreement
or any of the other Financing Agreements as and when to be performed; or (e)
the ability of Agent or any Lender to enforce the Obligations or realize upon
the Collateral or otherwise with respect to the rights and remedies of Agent
and Lenders under this Agreement or any of the other Financing Agreements.


 


25

















 


1.100  “Material Contract” shall mean (a) the Shared
Services Agreement, (b) each of the Existing HPT Leases, (c) the Freightliner
Agreement, (d) the Sublease Agreement, dated as of January 31, 2007, by and
between TA Operating and TA Leasing and (e) any other contract or other
agreement (other than the Financing Agreements), whether written or oral, to
which any Borrower or Guarantor is a party as to which the breach,
nonperformance, cancellation or failure to renew by any party thereto would
have a Material Adverse Effect.


 


1.101  “Material
License Agreement” shall mean each License Agreement to which any Borrower or
Guarantor is a party which constitutes a Material Contract; sometimes referred
to herein collectively as “Material License Agreements.”


 


1.102  “Maturity
Date” shall have the meaning set forth in Section 13.1 hereof.


 


1.103  “Maximum
Credit” shall mean the amount of $100,000,000, as such amount may be increased
in accordance with Section 2.3 hereof.


 


1.104  “Monthly
Average Adjusted Excess Availability” shall mean, at any time, the daily
average of the Adjusted Excess Availability for the immediately preceding calendar
month.


 


1.105  “Multiemployer
Plan” shall mean a “multi-employer plan” as defined in Section 4001(a)(3) of
ERISA which is or was at any time during the current year or the immediately
preceding six (6) years contributed to by any Borrower, Guarantor or any ERISA
Affiliate.


 


1.106  “Net
Recovery Percentage” shall mean the fraction, expressed as a percentage, (a)
the numerator of which is the amount equal to the amount of the recovery in
respect of the Inventory at such time on a “going out of business “ basis as
set forth in the most recent acceptable appraisal of Inventory received by
Agent in accordance with Section 7.3, net of operating expenses, liquidation
expenses and commissions, and (b) the denominator of which is the applicable
average cost of the aggregate amount of the Inventory subject to such
appraisal.


 


1.107  “New
Lending Office” shall have the meaning specified in Section 6.13 hereof.


 


1.108  “Non-US
Lender” shall have the meaning set forth in Section 6.13 hereof.


 


1.109  “Obligations”
shall mean (a) any and all Loans, Letter of Credit Accommodations and all other
obligations, liabilities and indebtedness of every kind, nature and description
owing by any or all of Borrowers to Agent or any Lender and/or any of their
Affiliates, including principal, interest, charges, fees, costs and expenses,
however evidenced, whether as principal, surety, endorser, guarantor or
otherwise, arising under this Agreement or any of the other Financing
Agreements, whether now existing or hereafter arising, whether arising before,
during or after the initial or any renewal term of this Agreement or after the
commencement of any case with respect to such Borrower under the United States
Bankruptcy Code or any similar statute (including the payment of interest and
other amounts which would accrue and become due but for the commencement of
such case, whether or not such amounts are allowed or allowable in whole or in
part in such case), whether direct or indirect, absolute or 


 


26

















 


contingent, joint or several, due or not due, primary
or secondary, liquidated or unliquidated, or secured or unsecured and (b) for
purposes of Section 5.1 hereof and the Security Provisions and subject to the
priority in right of payment set forth in Section 6.4 hereof, all obligations,
liabilities and indebtedness of every kind, nature and description owing by any
or all of Borrowers or Guarantors to Agent or any Bank Product Provider arising
under or pursuant to any Bank Products, whether now existing or hereafter
arising, provided, that, (i) as to any such obligations, liabilities and
indebtedness arising under or pursuant to a Hedge Agreement, the same shall
only be included within the Obligations if upon Agent’s request, Agent shall
have entered into an agreement, in form and substance  reasonably satisfactory to Agent, with the
Bank Product Provider that is a counterparty to such Hedge Agreement, as
acknowledged and agreed to by Borrowers and Guarantors, providing for the
delivery to Agent by such counterparty or information with respect to the
amount of such obligations and providing for the other rights of Agent and such
Bank Product Provider in connection with such arrangements, (ii) any Bank
Product Provider, other than Wachovia and its Affiliates, shall have delivered
written notice to Agent that (A) such Bank Product Provider has entered into a
transaction to provide Bank Products to a Borrower and Guarantor and (B) the
obligations arising pursuant to such Bank Products provided to Borrowers and
Guarantors constitute Obligations entitled to the benefits of the security
interest of Agent granted hereunder, and (iii) in no event shall any Bank
Product Provider to whom such obligations, liabilities or indebtedness are
owing be deemed a Lender for purposes hereof to the extent of and as to such
obligations, liabilities or indebtedness other than for purposes of Section 5.1
hereof and other than for purposes of Sections 12.1, 12.2, 12.3(b), 12.6, 12.7.
12.9, 12.12, 13.1(a) (but solely to the extent relating to the delivery of cash
collateral for Obligations arising under or in connection with any Bank
Products), and 13.6 hereof.


 


1.110  “Obligor”
shall mean any guarantor, endorser, acceptor, surety or other person liable on
or with respect to the Obligations or who is the owner of any property which is
security for the Obligations (including, without limitation, Guarantors), other
than Borrowers.


 


1.111  “Other
Taxes” shall have the meaning specified in Section 6.13 hereof.


 


1.112  “Parent” shall
mean TravelCenters of America LLC, a Delaware limited liability company, and
its successors and assigns.


 


1.113  “Participant”
shall mean any financial institution that acquires and holds a participation in
the interest of any Lender in any of the Loans and Letter of Credit
Accommodations in conformity with the provisions of Section 13.7 of this
Agreement governing participations.


 


1.114  “Perishable
Inventory” shall mean Inventory consisting of dairy, frozen foods, deli, bread,
sweet snacks and other perishable grocery items.


 


1.115  “Permitted
Acquisitions” shall mean the purchase by a Borrower or Guarantor (whether
directly or indirectly through a Specified Subsidiary) after the date hereof of
all or substantially all of the assets of any Person or a business or division
of such Person (including pursuant to a merger with such Person or the
formation of a wholly owned Subsidiary solely for such purpose that is merged
with such Person) or of all or a majority of the Capital Stock of such Person
(such assets or Person being referred to herein as the “Acquired Business”) in
one or a series of transactions that satisfies each of the following conditions
as determined by Agent:


 


27

















 


(a)           the
Acquired Business shall be an operating company that engages in a line of
business substantially similar to the business that Borrowers are engaged in on
the date hereof or any business reasonably related or complementary to such
line of business,


 


(b)           Agent
shall have received all items required by Sections 5.2 and 9.21 in connection
with the Acquired Business (subject to the terms of Section 9.21(d) hereof),


 


(c)           in
the case of the acquisition of the Capital Stock of another Person, the board
of directors (or other comparable governing body) of such other Person shall
have duly approved such acquisition and such Person shall not have announced
that it will oppose such acquisition or shall not have commenced any action
which alleges that such acquisition will violate applicable law,


 


(d)           Excess
Availability plus Unrestricted Cash shall not be less than  the amount equal to thirty-five (35%) percent
of the Maximum Credit, as of the date of such acquisition and immediately after
giving effect thereto,


 


(e)           no
Default or Event of Default shall have occurred and be continuing as of the
date of the acquisition or any payment in respect thereof made on or about the
closing date of such acquisition and after giving effect to the acquisition or
such payment,


 


(f)            in
the case of an acquisition of Capital Stock of another Person, such Person
shall be organized under the laws of a jurisdiction within the United States
except that such Person acquired pursuant to such acquisition may be organized
under the laws of a jurisdiction outside the United States if (i) one or more
other Persons acquired pursuant to such acquisition is organized under the laws
of a jurisdiction within the United States and (ii) the book value of the
assets of such Person shall not exceed five (5%) of the book value of the
assets of all such other Persons,


 


(g)           in
the case of an acquisition of assets or a business or division of another
Person, such assets, business or division shall be located within the United
States except that such assets, business or division acquired pursuant to such
acquisition may be located outside the United States if (i) other assets,
businesses or divisions which are acquired pursuant to such acquisition are
located within the United States and (ii) the book value of such assets,
business or division shall not exceed five (5%) percent of the book value of
such other assets, business or divisions,


 


(h)           in
the case of an acquisition where the consideration paid or payable is greater
than $25,000,000, Agent shall have received not less than five (5) Business
Days’ prior written notice (or such lesser period as to which Agent may
reasonably consent) of such acquisition;


 


(i)            in
the case of an acquisition of more than one travel center location, Agent shall
have received a certificate of the chief financial officer or chief executive
officer of Administrative Borrower certifying to Agent and Lenders as to the
matters set forth above in this definition, and


 


(j)            in
the case of an acquisition of only a single travel center location, Agent shall
receive, on or prior to the date on which Borrowers and Guarantors are required
to deliver 


 


28

















 


the next
succeeding Compliance Certificate pursuant to Section 9.6(a) hereof, a
certificate of the chief financial officer or chief  executive officer of Administrative Borrower
certifying to Agent and Lender as to the matters set forth above in this
definition.


 


1.116  “Person”
or “person” shall mean any individual, sole proprietorship, partnership,
corporation (including any corporation which elects subchapter S status under
the Code), limited liability company, limited liability partnership, business
trust, unincorporated association, joint stock corporation, trust, joint
venture or other entity or any government or any agency or instrumentality or
political subdivision thereof.


 


1.117  “Petro
Companies” shall mean, collectively, Petro, Petro Distributing and Petro
Financial.


 


1.118  “Petro
Existing Letters of Credit” shall mean the letters of credit issued for the account
of any of the Petro Companies or for which any of the Petro Companies are
liable which are listed on Schedule 1.118 hereto.


 


1.119  “Petro
Existing Security Agreement” shall mean the Security, Collateral Agency and
Intercreditor Agreement, dated as of February 9, 2004, among Petro, certain
affiliates of Petro, Wells Fargo Bank, N.A., as agent and collateral agent, the
Petro Indenture Trustee and ExxonMobil Oil, as the same now exists or may
hereafter be amended in accordance with the terms hereof.


 


1.120  “Petro
Existing Security Agreement Termination Date” shall have the meaning set forth
in Section 9.23 hereof.


 


1.121  “Petro
Indenture” shall mean the Indenture, dated as of February 9, 2004, by and among
the Petro Companies, Petro Stopping Centers Holdings, L.P., Petro, Inc. and the
Petro Indenture Trustee, as amended by the First Supplemental Indenture, dated
as of February 9, 2004.


 


1.122  “Petro
Indenture Cash Collateral” shall have the meaning set forth in Section 8.3
hereof.


 


1.123  “Petro
Indenture Trustee” shall mean The Bank of New York, as trustee under the Petro
Indenture.


 


1.124   “Petro
Lien Effective Date “ shall mean the earlier of (a) the date which is ninety
(90) days after the date of this Agreement (or such later date as to which
Agent shall consent in writing, which consent shall not be unreasonably
withheld so long as the Petro Companies are continuing to diligently use their
commercially reasonable efforts to cause all of the Petro Existing Letters of
Credit to be terminated), (b) the first date on which all of the Petro Existing
Letters of Credit have expired or been terminated or (c) the date on which the
negative pledge clause contained in the Petro Existing Security Agreement is
waived or otherwise ceases to be effective as to the liens of Agent; provided,
that, in no event shall the Petro Lien Effective Date be later than
August 31, 2008.


 


1.125  “Petro
Travel Plaza Operating Agreement” shall mean the Limited Liability Company
Operating Agreement of Petro Travel Plaza LLC, dated as of December 5, 


 


29

















 


1997, by and among Petro Shopping Centers, L.P., Tejon
Development Corporation and Tejon Ranch Company, as amended by the First
Amendment to the Limited Liability Company Operating Agreement of Petro Travel
Plaza LLC, dated as of January 1, 1999, and the Second Amendment to the Limited
Liability Company Operating Agreement of Petro Travel Plaza LLC, dated as of
December 19, 2002, as in effect on the date hereof.


 


1.126  “Plan”
means an employee benefit plan (as defined in Section 3(3) of ERISA) which any
Borrower or Guarantor sponsors, maintains, or to which it makes, is making, or
is obligated to make contributions, or in the case of a Multiemployer Plan has
made contributions at any time during the immediately preceding six (6) plan
years.


 


1.127  “Prime
Rate” shall mean the rate from time to time publicly announced by Wachovia
Bank, National Association, or its successors, as its prime rate, whether or
not such announced rate is the best rate available at such bank.


 


1.128  “Prime
Rate Loans” shall mean any Loans or portion thereof on which interest is
payable based on the Prime Rate in accordance with the terms thereof.


 


1.129  “Propco”
shall mean any Guarantor formed or acquired after the date hereof which does
not own, and will not own or acquire, any assets other than Real Property and
Equipment and which has been designated in writing after the date hereof as a “Propco”
by Parent to Agent.


 


1.130  “Pro Rata
Share” shall mean as to any Lender, the fraction (expressed as a percentage)
the numerator of which is such Lender’s Commitment and the denominator of which
is the aggregate amount of all of the Commitments of Lenders, as adjusted from
time to time in accordance with the provisions of Section 13.7 hereof; provided,
that, if the Commitments have been terminated, the numerator shall be
the unpaid amount of such Lender’s Loans and its interest in the Letter of
Credit Accommodations and the denominator shall be the aggregate amount of all
unpaid Loans and Letter of Credit Accommodations.


 


1.131  “Provision
for Taxes” shall mean an amount equal to all taxes imposed on or measured by
net income, whether Federal, State, Provincial, county or local, and whether
foreign or domestic, that are paid or payable by any Person in respect of any
period in accordance with GAAP.


 


1.132  “Qualified
Assumed Indebtedness” shall mean Indebtedness of a Person which becomes a
Borrower or Guarantor after the date hereof in connection with a Permitted
Acquisition; provided, that, (a) such Indebtedness existed prior
to the closing of such Permitted Acquisition and (b) such indebtedness was not
created or incurred in connection with, or in anticipation of, such Permitted
Acquisition.


 


1.133  “Real
Property” shall mean all now owned and hereafter acquired real property of each
Borrower and Guarantor, including leasehold interests, together with all
buildings, structures, and other improvements located thereon and all licenses,
easements and appurtenances relating thereto, wherever located.


 


1.134  “Real
Property Availability” shall mean (a) prior to the date on which the Real
Property Availability Conditions have been satisfied, zero (o), and (b) from
and after the 


 


30

















 


date on which the Real Property Availability
Conditions have been satisfied as reasonably determined by Agent, the amount
equal to sixty five (65%) percent of the fair market value of Eligible Real
Property as set forth in the most recent acceptable appraisal of such Real
Property received by Agent in accordance with the terms hereof; provided,
that, the Real Property Availability shall be reduced on the first day
of each calendar quarter, commencing with the first full calendar quarter
following the date on which the Real Property Availability Conditions have been
satisfied, by an amount equal to the initial Real Property Availability
calculated in accordance with this clause (b) divided by twenty eight (28).


 


1.135  “Real
Property Availability Conditions” shall mean, collectively, the following:


 


(a)           Agent
shall have received a written request from Administrative Borrower to include
the Real Property Availability in the Borrowing Base (which request shall be
irrevocable);


 


(b)           Agent
shall have received, as to each parcel of Real Property constituting Eligible
Real Property, a mortgage or deed of trust encumbering such Real Property, in
form and substance reasonably satisfactory to Agent, duly authorized, executed
and delivered by the applicable Borrower;


 


(c)           Agent
shall have received a written appraisal as to each parcel of Real Property
constituting Eligible Real Property, which shall be in form, scope and
methodology reasonably acceptable to Agent and by an appraiser acceptable to
Agent and which shall be addressed to Agent and shall reveal results acceptable
to Agent;


 


(d)           Agent
shall have received environmental audits of each parcel of Real Property
constituting Eligible Real Property, conducted by an independent environmental
engineering firm acceptable to Agent, and in form, scope and methodology
reasonably satisfactory to Agent, confirming that (i) each Borrower and
Guarantor is in compliance with all material applicable Environmental Laws with
respect to such Real Property and (ii) the absence of any material
environmental problems with respect to such Real Property; and


 


(e)           Agent
shall have received, in form and substance reasonably satisfactory to Agent, a
valid and effective title insurance policy issued by a company and agent
reasonably acceptable to Agent: (i) insuring the priority, amount and
sufficiency of each mortgage and deed of trust described in clause (b) above,
(ii) insuring against matters that would be disclosed by surveys and (iii)
containing any legally available endorsements, assurances or affirmative
coverage requested by Agent for protection of its interests.


 


1.136  “Receivables”
shall mean all of the following now owned or hereafter arising or acquired
property of each Borrower and Guarantor: (a) all Accounts; (b) all interest, fees,
late charges, penalties, collection fees and other amounts due or to become due
or otherwise payable in connection with any Account; (c) all payment
intangibles of such Borrower or Guarantor; (d) 
letters of credit, indemnities, guarantees, security or other deposits
and proceeds thereof issued payable to any Borrower or Guarantor or otherwise
in favor of or delivered to any Borrower or Guarantor in connection with any
Account; or (e) all other accounts, contract rights, chattel paper,
instruments, notes, general intangibles and other forms of obligations owing to
any Borrower or Guarantor, whether from the sale and lease of goods or other
property, licensing of 


 


31

















 


any property (including Intellectual Property or other
general intangibles), rendition of services or from loans or advances by any
Borrower or Guarantor or to or for the benefit of any third person (including
loans or advances to any Affiliates or Subsidiaries of any Borrower or
Guarantor) or otherwise associated with any Accounts, Inventory or general
intangibles of any Borrower or Guarantor (including, without limitation, choses
in action, causes of action, tax refunds, tax refund claims, any funds which
may become payable to any Borrower or Guarantor in connection with the
termination of any Plan or other employee benefit plan and any other amounts
payable to any Borrower or Guarantor from any Plan or other employee benefit
plan, rights and claims against carriers and shippers, rights to indemnification,
business interruption insurance and proceeds thereof, casualty or any similar
types of insurance and any proceeds thereof and proceeds of insurance covering
the lives of employees on which any Borrower or Guarantor is a beneficiary).


 


1.137  “Records”
shall mean, as to each Borrower and Guarantor, all of such Borrower’s and
Guarantor’s present and future books of account of every kind or nature,
purchase and sale agreements, invoices, ledger cards, bills of lading and other
shipping evidence, statements, correspondence, memoranda, credit files and
other data relating to the Collateral or any account debtor, together with the
tapes, disks, diskettes and other data and software storage media and devices,
file cabinets or containers in or on which the foregoing are stored (including
any rights of any Borrower or Guarantor with respect to the foregoing
maintained with or by any other person).


 


1.138  “Reference
Bank” shall mean Wachovia Bank, National Association, or such other bank as
Agent may from time to time designate.


 


1.139  “Register”
shall have the meaning set forth in Section 13.7 hereof.


 


1.140  “Required
Lenders” shall mean, at any time, those Lenders whose Pro Rata Shares aggregate
more than fifty (50%) percent of the aggregate of the Commitments of all
Lenders, or if the Commitments shall have been terminated, Lenders to whom more
than fifty (50%) percent of the then outstanding Obligations are owing; provided,
that, if there is more than one Lender and the Pro Rata Share of any
Lender is more than fifty (50%) percent, then Required Lenders shall mean such
Lender plus at least one other Lender.


 


1.141  “Reserves” shall mean as of any date of
determination, such amounts as Agent may from time to time establish and revise
in good faith reducing the amount of Revolving Loans and Letter of Credit
Accommodations which would otherwise be available to any Borrower under the
lending formula(s) provided for herein: 
(a) to reflect events, conditions, contingencies or risks which, as
determined by Agent in good faith, adversely affect, or would have a reasonable
likelihood of adversely affecting, either (i) the Collateral or any other
property which is security for the Obligations, its value or the amount that
might be received by Agent from the sale or other disposition or realization
upon such Collateral, or (ii) the assets or business of any Borrower or Obligor
or (iii) the security interests and other rights of Agent or any Lender in the
Collateral (including the enforceability, perfection and priority thereof) or
(b) to reflect Agent’s good faith belief that any collateral report or
financial information furnished by or on behalf of any Borrower or Obligor to
Agent is or may have been incomplete, inaccurate or misleading in any material
respect or (c) in respect of any state of facts which constitute a Default or
an Event of Default. Without limiting the generality of the foregoing, Reserves
may, at Agent’s option, be established to reflect any of the following: (i)
that dilution with respect to 


 


32

















 


the Accounts (based on
the ratio of the aggregate amount of non-cash reductions in Accounts for any
period to the aggregate dollar amount of the sales of such Borrower for such
period) as calculated by Agent for any period is or is reasonably anticipated
to be greater than five (5%) percent; (ii) returns, discounts, claims, vendor
rebates, credits and allowances of any nature that are not paid pursuant to the
reduction of Accounts; (iii) a change in the turnover, age or mix of the
categories of Inventory that adversely affects the aggregate value of all
Inventory, (iv) inventory shrinkage, (v) reserves in respect of markdowns and
cost variances (pursuant to discrepancies between the purchase order price of
Inventory and the actual cost thereof), (vi) amounts due or to become due in
respect of sales, use, withholding, excise and/or similar taxes, (vii) any
rental payments, service charges or other amounts to become due to lessors and
operators of real property to the extent Inventory, Equipment or Records are
located in or on such property or such Records are needed to monitor or
otherwise deal with the Collateral (except that Agent will not establish such
reserve for any property for which Agent has received a Collateral Access
Agreement accepted by Agent in writing if all such payments, charges and other
amounts have been paid when due), provided, that, the Reserves
established pursuant to this clause (vii) as to retail store locations that are
leased shall not exceed at any time the aggregate of amounts payable for the
next three (3) months to the lessors of such retail store locations, provided,
that, such limitation on the amount of the Reserves pursuant to this clause
(vii) shall only apply so long as: (A) no Event of Default shall have occurred
and be continuing, (B) neither a Borrower, Guarantor nor Agent shall have
received notice of any event of default under the lease with respect to such
location and (C) no Borrower or Guarantor has granted to the lessor a security
interest or lien upon any assets of such Borrower or Guarantor, (viii) amounts
owing by Borrowers to Credit Card Issuers or Credit Card Processors in
connection with the Credit Card Agreements, (ix) variances between the
perpetual inventory records of Borrowers and the results of the test counts of
Inventory conducted by Agent with respect thereto in excess of the percentage
acceptable to Agent, (x) the aggregate amount of deposits, if any, received by
any Borrower from its customers in respect of unfilled orders for goods, (xi)
fifty (50%) percent of the aggregate amount of gift certificates, and (xii)
obligations, liabilities or indebtedness (contingent or otherwise) of Borrowers
or Guarantors to any Bank Product Provider arising under or in connection with
any Bank Products of any Borrower or Guarantor with a Bank Product Provider or
as such Bank Product Provider may otherwise require in connection therewith to
the extent that such obligation, liabilities or indebtedness constitute Obligations
as such term is defined herein or otherwise receive the benefit of the security
interest of Agent in any Collateral. To the extent Agent may establish a
Reserve so as to address any event, condition or other circumstance in a manner
satisfactory to Agent as determined by Agent in good faith, Agent shall not
establish a new criteria or revise criteria for Eligible Accounts, Eligible
Equipment, Eligible Inventory, Eligible Credit Card Receivables or Eligible
Real Property for the same purpose and Agent shall not make Accounts, Credit
Card Receivables, Equipment, Inventory or Real Property ineligible based on
criteria for Eligible Accounts, Eligible Equipment, Eligible Credit Card
Receivables or Eligible Real Property for the same purpose. The amount of any
Reserve established by Agent shall have a reasonable relationship to the event,
condition or other matter which is the basis for such reserve as determined by
Agent in good faith.


 


1.142  “Restricted Payment” shall mean (a) any
dividend or other distribution, direct or indirect, on account of any Capital
Stock of any Borrower or Guarantor now or hereafter outstanding, except a
dividend payable solely in Capital Stock of identical class to the holders of
that class; (b) any redemption, conversion, exchange, retirement, sinking
fund or 


 


33

















 


similar payment, purchase
or other acquisition for value, direct or indirect, of any Capital Stock of any
Borrower or Guarantor now or hereafter outstanding; and (c) any payment
made to retire, or to obtain the surrender of, any outstanding warrants,
options or other rights to acquire any Capital Stock of any Borrower or
Guarantor now or hereafter outstanding.


 


1.143  “Revolving
Loans” shall mean the loans now or hereafter made by or on behalf of any Lender
or by Agent for the account of any Lender on a revolving basis pursuant to the
Credit Facility (involving advances, repayments and readvances) as set forth in
Section 2.1 hereof.


 


1.144  “Secured
Parties” shall mean, collectively, (i) Agent, (ii) Lenders, and (iii) any Bank
Product Provider; provided, that, as to any Bank Product
Provider, only to the extent of the Obligations owing to such Bank Product
Provider; such parties are sometimes referred to herein individually as a “Secured
Party”.


 


1.145  “Security
Provisions” shall mean the following provisions of the Financing Agreements (as
the same now exist or may hereafter be amended, modified, supplemented,
extended, renewed, restated or replaced): (a) Section 1(a) of the Guarantee,
dated even date herewith, by Borrowers and Guarantors in favor of Agent; (b)
Sections 1 and 2 of the Pledge and Security Agreement, dated even date
herewith, by TravelCenters in favor of Agent; (c) Sections 1 and 2 of the
Pledge and Security Agreement, dated even date herewith, by Holding in favor of
Agent; (d) Sections 1 and 2 of the Pledge and Security Agreement, dated even
date herewith, by TravelCenters and TCA in favor of Agent; (e) Sections 1 and 2
of the Pledge and Security Agreement, dated even date herewith, by Petro in
favor of Agent; (f) Sections 1 and 2 of the Trademark Collateral Assignment and
Security Agreement, dated even date herewith, by and between Petro and Agent;
(g) Sections 1 and 2 of the Copyright Collateral Assignment and Security
Agreement, dated even date herewith, by and between Petro and Agent; and (h)
such other sections of such other Financing Agreements as Agent may from time
to time designate as a “Security Provision” in a writing delivered by Agent to
Administrative Borrower.


 


1.146  “Shared
Services Agreement” shall mean the Management and Shared Services Agreement,
dated as of January 31, 2007, by and between Parent and Reit Management &
Research LLC, as the same exists or may hereafter be amended, modified, supplemented,
extended, renewed, restated or replaced.


 


1.147  “Solvent”
shall mean, at any time with respect to any Person, that at such time such
Person (a) is able to pay its debts as they mature and has (and has a
reasonable basis to believe it will continue to have) sufficient capital (and
not unreasonably small capital) to carry on its business consistent with its
practices as of the date hereof, and (b) the assets and properties of such
Person at a fair valuation (and including as assets for this purpose at a fair
valuation all rights of subrogation, contribution or indemnification arising
pursuant to any guarantees given by such Person) are greater than the
Indebtedness of such Person, and including subordinated and contingent
liabilities computed at the amount which, such person has a reasonable basis to
believe, represents an amount which can reasonably be expected to become an
actual or matured liability (and including as to contingent liabilities arising
pursuant to any guarantee the face amount of such liability as reduced to
reflect the probability of it becoming a matured liability).


 


1.148  “Special
Agent Advances” shall have the meaning set forth in Section 12.11 hereof.


 


34

















 


1.149  “Specified
Subsidiary” shall mean (a) any Person whose Capital Stock is purchased by a
Borrower or Guarantor pursuant to a Permitted Acquisition and (b) any
Subsidiary of a Borrower or Guarantor formed pursuant to Section 9.10(l) for
the purpose of making, or in anticipation of consummating, a Permitted
Acquisition; provided, that, in no event shall a Specified
Subsidiary be an Excluded Subsidiary.


 


1.150  “Store
Accounts” shall have the meaning set forth in Section 6.3 hereof.


 


1.151  “Standby
Letters of Credit” shall mean all Letter of Credit Accommodations other than
Commercial Letters of Credit.


 


1.152  “Subsidiary”
or “subsidiary” shall mean, with respect to any Person, any corporation,
limited liability company, limited liability partnership or other limited or
general partnership, trust, association or other business entity of which an
aggregate of at least a majority of the outstanding Capital Stock or other
interests entitled to vote in the election of the board of directors of such
corporation (irrespective of whether, at the time, Capital Stock of any other
class or classes of such corporation shall have or might have voting power by
reason of the happening of any contingency), managers, trustees or other
controlling persons, or an equivalent controlling interest therein, of such
Person is, at the time, directly or indirectly, owned by such Person and/or one
or more subsidiaries of such Person.


 


1.153  “Taxes”
shall have the meaning set forth in Section 6.13 hereof.


 


1.154  “Tested
Subsidiaries” shall mean all Subsidiaries of Parent; provided  that,
if the EBITDAR or the total assets of the Excluded Subsidiaries (on a combined
basis) for any period for which the Debt Incurrence Ratio or the Fixed Charge
Coverage Ratio is calculated pursuant to this Agreement or any other Financing
Agreement is greater than five (5%) percent of the EBITDAR or the total assets,
respectively, of Parent and its Subsidiaries (on a consolidated basis) for such
period, then Tested Subsidiaries shall mean all Subsidiaries of Parent other
than the Excluded Subsidiaries.


 


1.155  “UCC”
shall mean the Uniform Commercial Code as in effect in the State of New York,
and any successor statute, as in effect from time to time (except that terms
used herein which are defined in the Uniform Commercial Code as in effect in
the State of New York on the date hereof shall continue to have the same
meaning notwithstanding any replacement or amendment of such statute except as
Agent may otherwise determine).


 


1.156       “Unrestricted
Cash” shall mean, as of any date of determination, the amount of cash of
Borrowers and Guarantors maintained in bank accounts or securities accounts (a)
which is not subject to a perfected security interest in favor of any Person
(other than Agent), (b) with respect to which Agent has received statements of
the available balances thereof from the bank or other financial institution at
which such account is maintained which confirm such amounts and (c) which is
available to Borrower and Guarantors without condition or restriction except
those arising pursuant to the pledge (if any) in favor of Agent; provided,
that, in any event, Unrestricted Cash shall not include Eligible Cash
Collateral, Petro Indenture Cash Collateral or any cash in the Customer Loyalty
Accounts.


 


1.157  “Value”
shall mean, as determined by Agent in good faith, with respect to Inventory,
the lower of (a) cost computed on an average basis in accordance with GAAP or
(b) 


 


35

















 


market value, provided, that, for
purposes of the calculation of the Borrowing Base, (i) the Value of the
Inventory shall not include: (A) the portion of the value of Inventory equal to
the profit earned by any Affiliate on the sale thereof to any Borrower or (B)
write-ups or write-downs in value with respect to currency exchange rates and
(ii) notwithstanding anything to the contrary contained herein, the cost of the
Inventory shall be computed in the same manner and consistent with the most
recent appraisal of the Inventory received and accepted by Agent prior to the
date hereof, if any.


 


1.158  “Voting
Stock” shall mean with respect to any Person, (a) one (1) or more classes of
Capital Stock of such Person having general voting powers to elect at least a
majority of the board of directors, managers or trustees of such Person,
irrespective of whether at the time Capital Stock of any other class or classes
have or might have voting power by reason of the happening of any contingency,
and (b) any Capital Stock of such Person convertible or exchangeable without restriction
at the option of the holder thereof into Capital Stock of such Person described
in clause (a) of this definition.


 


1.159  “Wachovia”
shall mean Wachovia Capital Finance Corporation (Central), an Illinois
corporation, in its individual capacity, and its successors and assigns.


 


SECTION 2.           CREDIT
FACILITIES


 


2.1         Loans.


 


(a)           Subject
to and upon the terms and conditions contained herein, each Lender severally
(and not jointly) agrees to make its Pro Rata Share of Revolving Loans to
Borrowers from time to time in amounts requested by a Borrower (or
Administrative Borrower on behalf of such Borrower) up to the amount
outstanding at any time equal to the lesser of: (i) the Borrowing Base at
such time or (ii) the Maximum Credit at such time.


 


(b)           Except
in Agent’s discretion and with the consent of all Lenders, or as otherwise
provided herein, (i) the aggregate amount of the Loans and the Letter of Credit
Accommodations outstanding at any time shall not exceed the Maximum Credit,
(ii) the aggregate principal amount of the Revolving Loans and Letter of Credit
Accommodations outstanding at any time shall not exceed the Borrowing Base,
(iii) the aggregate principal amount of the Revolving Loans and Letter of
Credit Accommodations outstanding at any time based on Eligible Inventory
consisting of gasoline and diesel fuel shall not exceed the Fuel Inventory Loan
Limit, (iv) the aggregate principal amount of the Revolving Loans and Letter of
Credit Accommodations outstanding at any time based on the Eligible Inventory
which is Perishable Inventory shall not exceed $2,000,000 and (v) the aggregate
principal amount of Revolving Loans and Letter of Credit Accommodations
outstanding at any time based on Eligible Inventory shall not exceed the
Inventory Loan Limit.


 


(c)           In
the event that the aggregate principal amount of the Loans and Letter of Credit
Accommodations outstanding exceed the Maximum Credit, or the aggregate
principal amount of Revolving Loans and Letter of Credit Accommodations
outstanding exceed the Borrowing Base, or the aggregate principal amount of
Revolving Loans and Letter of Credit Accommodations outstanding based on
Eligible Inventory consisting of gasoline and diesel fuel exceed the Fuel
Inventory Loan Limit, the aggregate principal amount of Revolving Loans and
Letter of Credit Accommodations outstanding based on the Eligible Inventory
which is 


 


36

















 


Perishable
Inventory exceeds the sublimit set forth above, the aggregate principal amount
of Revolving Loans and Letter of Credit Accommodations outstanding based on
Eligible Inventory exceed the Inventory Loan Limit, or the aggregate amount of
the outstanding Letter of Credit Accommodations exceed the sublimit for Letter
of Credit Accommodations set forth in Section 2.2(e), such event shall not
limit, waive or otherwise affect any rights of Agent or Lenders in such
circumstances or on any future occasions and Borrowers shall, upon demand by
Agent, which may be made at any time or from time to time, immediately repay to
Agent the entire amount of any such excess(es) for which payment is demanded.


 


2.2         Letter of Credit Accommodations.


 


(a)           Subject
to and upon the terms and conditions contained herein, at the request of a
Borrower (or Administrative Borrower on behalf of such Borrower), Agent agrees,
for the ratable risk of each Lender according to its Pro Rata Share, to provide
or arrange for Letter of Credit Accommodations for the account of such Borrower
containing terms and conditions reasonably acceptable to Agent and the issuer
thereof. Any payments made by or on behalf of Agent or any Lender to any issuer
thereof and/or related parties in connection with the Letter of Credit
Accommodations provided to or for the benefit of a Borrower shall constitute
additional Revolving Loans to such Borrower pursuant to this Section 2 (or
Special Agent Advances as the case may be).


 


(b)           In
addition to any customary charges, fees or expenses charged by any bank or
issuer in connection with the Letter of Credit Accommodations, Borrowers shall
pay to Agent, for the benefit of Lenders, a letter of credit fee at a rate
equal to the percentage (on a per annum basis) set forth below on the daily
outstanding balance of the Commercial Letters of Credit and Standby Letters of
Credit during the immediately preceding month (or part thereof), payable in
arrears as of the first day of each succeeding month, provided, that,
such percentage shall be increased or decreased, as the case may be, to the
percentage (on a per annum basis) set forth below based on the Monthly Average
Adjusted Excess Availability for the immediately preceding calendar month being
at or within the amounts indicated for such percentage:


 




	
  Tier

  	
   

  	
  Monthly Average Excess

  Adjusted Availability

  	
   

  	
  Commercial 

  Letter of

  Credit Rate

  	
   

  	
  Standby 

  Letter of

  Credit Rate

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1

  	
   

  	
  Greater than $40,000,000

  	
   

  	
  .50

  	
  %

  	
  1.00

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  2

  	
   

  	
  Less than or equal to $40,000,000 and greater than
  $20,000,000

  	
   

  	
  .625

  	
  %

  	
  1.25

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  3

  	
   

  	
  Less than or equal to $20,000,000

  	
   

  	
  .750

  	
  %

  	
  1.50

  	
  %

  






 


37

















 


provided,
that, (i) the applicable percentage shall be calculated and established
once each calendar month and shall remain in effect until adjusted thereafter
after the end of the next calendar month, and (ii) the applicable percentage
through March 31, 2008 shall be the amount for Tier 1 set forth above and (iii)
notwithstanding anything to the contrary contained herein, Agent may, and upon
the written direction of Required Lenders shall, require Borrowers to pay to
Agent for the benefit of Lenders, such letter of credit fee at a rate equal to
two (2%) percent per annum on such daily outstanding balance higher than the
rate set forth in Tier 3 for the period (1) from and after the effective date
of termination or non-renewal hereof until Agent and Lenders have received full
and final payment of all outstanding and unpaid Obligations in immediately
available funds and (2) from and after the date of the occurrence of an Event
of Default and for so long as such Event of Default is continuing. Such letter
of credit fee shall be calculated on the basis of a three hundred sixty (360)
day year and actual days elapsed and the obligation of Borrowers to pay such
fee shall survive the termination of this Agreement.


 


(c)           The
Borrower requesting such Letter of Credit Accommodation (or Administrative
Borrower on behalf of such Borrower) shall give Agent two (2) Business Days’
prior written notice of such Borrower’s request for the issuance of a Letter of
Credit Accommodation. Such notice shall be irrevocable and shall specify the
original face amount of the Letter of Credit Accommodation requested, the
effective date (which date shall be a Business Day and in no event shall be a
date less than ten (10) days prior to the end of the then current term of this
Agreement) of issuance of such requested Letter of Credit Accommodation,
whether such Letter of Credit Accommodation may be drawn in a single or in
partial draws, the date on which such requested Letter of Credit Accommodation is
to expire (which date shall be a Business Day), the purpose for which such
Letter of Credit Accommodation is to be issued, and the beneficiary of the
requested Letter of Credit Accommodation. The Borrower requesting the Letter of
Credit Accommodation (or Administrative Borrower on behalf of such Borrower)
shall attach to such notice the proposed terms of the Letter of Credit
Accommodation.


 


(d)           In
addition to being subject to the satisfaction of the applicable conditions
precedent contained in Sections 2.1 and 4 hereof and the other terms and
conditions contained herein, no Letter of Credit Accommodation shall be
available unless each of the following conditions precedent have been satisfied
in a manner reasonably satisfactory to Agent: 
(i) the Borrower requesting such Letter of Credit Accommodation (or
Administrative Borrower on behalf of such Borrower) shall have delivered to the
proposed issuer of such Letter of Credit Accommodation at such times and in
such manner as such proposed issuer may require, an application, in form and
substance reasonably satisfactory to such proposed issuer and Agent, for the
issuance of the Letter of Credit Accommodation and such other documents as may
be reasonably required pursuant to the terms thereof, (ii) as of the date of
issuance, no order of any court, arbitrator or other Governmental Authority
shall purport by its terms to enjoin or restrain money center banks generally
from issuing letters of credit of the type and in the amount of the proposed
Letter of Credit Accommodation, and no law, rule or regulation applicable to
money center banks generally and no request or directive (whether or not having
the force of law) from 


 


38

















 


any Governmental
Authority with jurisdiction over money center banks generally shall prohibit,
or request that the proposed issuer of such Letter of Credit Accommodation
refrain from, the issuance of letters of credit generally or the issuance of
such Letters of Credit Accommodation; and (iii) the Excess Availability, prior
to giving effect to the issuance of such Letter of Credit Accommodations, shall
be equal to or greater than an amount equal to one hundred (100%) percent of
the face amount thereof and all other commitments and obligations made or
incurred by Agent with respect thereto.


 


(e)           Except
in Agent’s discretion, with the consent of all Lenders, the amount of all
outstanding Letter of Credit Accommodations and all other commitments and
obligations made or incurred by Agent or any Lender in connection therewith
shall not at any time exceed seventy-five (75%) percent of the Maximum Credit.


 


(f)            Borrowers
and Guarantors shall indemnify and hold Agent and Lenders harmless from and
against any and all losses, claims, damages, liabilities, costs and expenses
which Agent or any Lender may suffer or incur in connection with any Letter of
Credit Accommodation and any documents, drafts or acceptances relating thereto,
including any losses, claims, damages, liabilities, costs and expenses due to
any action taken by any issuer or correspondent with respect to any Letter of
Credit Accommodation, except for such losses, claims, damages, liabilities,
costs or expenses that are a direct result of the gross negligence or willful
misconduct of Agent or any Lender as determined pursuant to a final
non-appealable order of a court of competent jurisdiction. Each Borrower and
Guarantor assumes all risks with respect to the acts or omissions of the drawer
under or beneficiary of any Letter of Credit Accommodation and for such
purposes the drawer or beneficiary shall be deemed such Borrower’s agent. Each
Borrower and Guarantor assumes all risks for, and agrees to pay, all foreign,
Federal, State and local taxes, duties and levies relating to any goods subject
to any Letter of Credit Accommodation or any documents, drafts or acceptances
thereunder. Each Borrower and Guarantor hereby releases and holds Agent and
Lenders harmless from and against any acts, waivers, errors, delays or
omissions, whether caused by any Borrower, Guarantor, by any issuer or
correspondent or otherwise with respect to or relating to any Letter of Credit
Accommodation, except for the gross negligence or willful misconduct of Agent
or any Lender as determined pursuant to a final, non-appealable order of a
court of competent jurisdiction. The provisions of this Section 2.2(f) shall
survive the payment of Obligations and the termination of this Agreement.


 


(g)           In
connection with Inventory purchased pursuant to Letter of Credit
Accommodations, Borrowers and Guarantors shall, at Agent’s request, instruct
all suppliers, carriers, forwarders, customs brokers, warehouses or others
receiving or holding cash, checks, documents or instruments in which Agent
holds a security interest to deliver them, upon Agent’s prior written request,
to Agent and/or subject to Agent’s order, and if they shall come into such
Borrower’s or Guarantor’s possession, to deliver them, upon Agent’s prior
written request, to Agent in their original form. Agent shall not exercise such
right to request such items so long as no Default or Event of Default shall
have occurred and be continuing. Except as Agent may otherwise specify,
Borrowers and Guarantors shall also, at Agent’s request, designate Agent as the
consignee on all bills of lading and other negotiable and non-negotiable
documents under any Letter of Credit Accommodation.


 


(h)           Each
Borrower and Guarantor hereby irrevocably authorizes and directs any issuer of
a Letter of Credit Accommodation to name such Borrower or Guarantor as the 


 


39

















 


account party
therein and to deliver to Agent all instruments, documents and other writings
and property received by issuer pursuant to the Letter of Credit Accommodations
and to accept and rely upon Agent’s instructions and agreements with respect to
all matters arising in connection with the Letter of Credit Accommodations or
the applications therefor. Nothing contained herein shall be deemed or
construed to grant any Borrower or Guarantor any right or authority to pledge
the credit of Agent or any Lender in any manner. Agent and Lenders shall have
no liability of any kind with respect to any Letter of Credit Accommodation
provided by an issuer other than Agent or any Lender unless Agent has duly executed
and delivered to such issuer the application or a guarantee or indemnification
in writing with respect to such Letter of Credit Accommodation. Borrowers and
Guarantors shall be bound by any reasonable interpretation made in good faith
by Agent, or any other issuer or correspondent under or in connection with any
Letter of Credit Accommodation or any documents, drafts or acceptances
thereunder, notwithstanding that such interpretation may be inconsistent with
any instructions of any Borrower or Guarantor.


 


(i)            Any
rights, remedies, duties or obligations granted or undertaken by any Borrower
or Guarantor to any issuer or correspondent in any application for any Letter
of Credit Accommodation, or any other agreement in favor of any issuer or
correspondent relating to any Letter of Credit Accommodation, shall be deemed
to have been granted or undertaken by such Borrower or Guarantor to Agent for
the ratable benefit of Lenders. Any duties or obligations undertaken by Agent
to any issuer or correspondent in any application for any Letter of Credit
Accommodation, or any other agreement by Agent in favor of any issuer or
correspondent to the extent relating to any Letter of Credit Accommodation,
shall be deemed to have been undertaken by Borrowers and Guarantors to Agent
for the ratable benefit of Lenders and to apply in all respects to Borrowers
and Guarantors.


 


(j)            Immediately
upon the issuance or amendment of any Letter of Credit Accommodation, each
Lender shall be deemed to have irrevocably and unconditionally purchased and
received, without recourse or warranty, an undivided interest and participation
to the extent of such Lender’s Pro Rata Share of the liability with respect to
such Letter of Credit Accommodation (including, without limitation, all
Obligations with respect thereto).


 


(k)           Each
Borrower is irrevocably and unconditionally obligated, without presentment,
demand or protest, to pay to Agent any amounts paid by an issuer of a Letter of
Credit Accommodation with respect to such Letter of Credit Accommodation
(whether through the borrowing of Loans in accordance with Section 2.2(a) or
otherwise). In the event that any Borrower fails to pay Agent on the date of
any payment under a Letter of Credit Accommodation in an amount equal to the
amount of such payment, Agent (to the extent it has actual notice thereof)
shall promptly notify each Lender of the unreimbursed amount of such payment
and each Lender agrees, upon one (1) Business Day’s notice, to fund to Agent
the purchase of its participation in such Letter of Credit Accommodation in an
amount equal to its Pro Rata Share of the unpaid amount. The obligation of each
Lender to deliver to Agent an amount equal to its respective participation
pursuant to the foregoing sentence is absolute and unconditional and such
remittance shall be made notwithstanding the occurrence or continuance of any
Event of Default, the failure to satisfy any other condition set forth in
Section 4 or any other event or circumstance. If such amount is not made
available by a Lender when due, Agent shall be entitled to recover such amount
on demand from such Lender with interest thereon, for each day from the date
such amount was due until the date such amount is paid to Agent at the interest
rate 


 


40

















 


then payable by
any Borrower in respect of Loans that are Prime Rate Loans as set forth in
Section 3.1(a) hereof.


 


2.3         Increase in Maximum Credit.


 


(a)           Administrative
Borrower may, at any time, deliver a written request to Agent to increase the
Maximum Credit. Any such written request shall specify the amount of the
requested increase in the Maximum Credit that Administrative Borrower is
requesting, provided, that, (i) in no event shall the aggregate amount of any
increase in the Maximum Credit cause the Maximum Credit to exceed $200,000,000,
(ii) any such request for an increase shall be for an increase of not less than
$10,000,000, (iii) any such request shall be irrevocable, and (iv) in no event
shall more than two such written requests be delivered to Agent in any calendar
year.


 


(b)           Upon
the receipt by Agent of a written request to increase the Maximum Credit, Agent
shall notify each of the Lenders of such request and each Lender shall have the
option (but not the obligation) to increase the amount of its Commitment by an
amount up to its Pro Rata Share of the amount of the increase in the Maximum
Credit requested by Administrative Borrower as set forth in the notice from
Agent to such Lender. Each Lender shall notify Agent within thirty (30) days
after the receipt of such notice of a request for such increase from Agent
whether it is willing to so increase its Commitment, and if so, the amount of
such increase; provided, that, no Lender shall be obligated to
provide such increase in its Commitment and the determination to increase the
Commitment of a Lender shall be within the sole and absolute discretion of such
Lender. If the aggregate amount of the increases in the Commitments received
from the Lenders does not equal or exceed the amount of the increase in the
Maximum Credit requested by Administrative Borrower, Agent may seek additional
increases from Lenders or Commitments from such Eligible Transferees as it may
determine, after consultation with Administrative Borrower. In the event Lenders
(or Lenders and any such Eligible Transferees, as the case may be) have
committed in writing to provide increases in their Commitments or new
Commitments in an aggregate amount in excess of the increase in the Maximum
Credit requested by Borrowers or permitted hereunder, Agent shall then have the
right to allocate such commitments, first to Lenders and then to Eligible
Transferees, in such amounts and manner as Agent may determine, after
consultation with Administrative Borrower.


 


(c)           In
the event of a request to increase the Maximum Credit, the Maximum Credit shall
be increased by the amount of the increase in Commitments from Lenders or new
Commitments from Eligible Transferees, in each case selected in accordance with
Section 2.3(b), for which Agent has received Assignment and Acceptances (or
other agreements acceptable to Agent) sixty (60) days after the date of the
request by Administrative Borrower for the increase or such earlier date as
Agent and Administrative Borrower may agree (but subject to the satisfaction of
the conditions set forth below), whether or not the aggregate amount of the
increase in Commitments and new Commitments, as the case may be, equal or
exceed the amount of the increase in the Maximum Credit requested by
Administrative Borrower in accordance with the terms hereof, effective on the
date that each of the following conditions have been satisfied:


 


(i)            Agent
shall have received from each Lender or Eligible Transferee that is providing
an additional Commitment as part of the increase in the Maximum Credit, an
Assignment and Acceptance (or another agreement acceptable to Agent) duly
executed by such Lender or Eligible Transferee and Administrative Borrower;


 


41

















 


(ii)           the
conditions precedent to the making of Revolving Loans set forth in Section 4.2
hereof shall be satisfied as of the date of the increase in the Maximum Credit,
both before and after giving effect to such increase;


 


(iii)          Agent
shall have received such agreements, documents and instruments (including legal
opinions) as Agent may request, in form and substance reasonably satisfactory
to Agent;


 


(iv)          such
increase in the Maximum Credit on the date of the effectiveness thereof shall
not violate any applicable law, regulation or order or decree of any court or
other Governmental Authority and shall not be enjoined, temporarily,
preliminarily or permanently;


 


(v)           there
shall have been paid to each Lender and Eligible Transferee providing an
additional Commitment in connection with such increase in the Maximum Credit
all fees (including any additional commitment fees) due and payable to such
Person on or before the effectiveness of such increase; and


 


(vi)          there
shall have been paid to Agent all costs and expenses (including reasonable fees
and expenses of counsel) due and payable to Agent pursuant to any of the
Financing Agreements on or before the effectiveness of such increase.


 


(d)           As
of the effective date of any such increase in the Maximum Credit, each
reference to the term Maximum Credit and Commitments herein and in any of the
other Financing Agreements shall be deemed amended to mean the amount of the
Maximum Credit and Commitments specified in the most recent written notice from
Agent to Administrative Borrower of the increase in the Maximum Credit and
Commitments.


 


2.4         Decrease in Maximum Credit. 


 


(a)           Administrative
Borrower may, at any time, deliver a written request to Agent to decrease the
Maximum Credit. Any such written request shall specify the amount of the decrease
in the Maximum Credit that Administrative Borrower is requesting and the
effective date of such decrease (which date shall not be less than five (5) nor
more than ten (10) Business Days after the date of such request); provided,
that, (i) any such request for a decrease shall be for an amount of not
less than $10,000,000, (ii) any such request shall be irrevocable, and (iii) in
no event shall more than one such written request for a decrease be delivered
to Agent in any calendar year.


 


(b)           Upon
the receipt by Agent of a written request to decrease the Maximum Credit, Agent
shall notify each of the Lenders of such request and, subject to the terms of
Section 2.3(c) hereof, the Commitment of each Lender shall be decreased on the
date requested by Administrative Borrower by an amount equal to such Lender’s
Pro Rata Share of the amount of the decrease in the Maximum Credit requested by
Administrative Borrower as set forth in the notice from Agent to such Lender.


 


(c)           In
the event of a request to decrease the Maximum Credit, the Maximum Credit shall
be decreased by the amount of the decrease in Maximum Credit requested by
Administrative Borrower in accordance with the terms hereof; provided, that,
after giving effect 


 


42

















 


to such decrease,
the Maximum Credit shall not be less than the aggregate amount of the Loans and
Letter of Credit Accommodations outstanding at such time.


 


(d)           As
of the effective date of any such decrease in the Maximum Credit, each reference
to the term Maximum Credit and Commitments herein and in any of the other
Financing Agreements shall be deemed amended to mean the amount of the Maximum
Credit and Commitments specified in the most recent written notice from Agent
to Administrative Borrower of the decrease in the Maximum Credit and
Commitments.


 


2.5           Commitments.  The aggregate amount of each Lender’s Pro Rata
Share of the Loans and Letter of Credit Accommodations shall not exceed the
amount of such Lender’s Commitment, as the same may from time to time be
amended in accordance with the provisions hereof.


 


SECTION 3.           INTEREST
AND FEES; PROCEDURES FOR BORROWING


 


3.1         Interest; Procedures for Borrowing.


 


(a)           Borrowers
shall pay to Agent, for the benefit of Lenders, interest on the outstanding
principal amount of the Loans at the Interest Rate. All interest accruing
hereunder upon the occurrence and during the continuance of any Event of
Default or after the termination hereof shall be payable on demand.


 


(b)           Each
Borrower (or Administrative Borrower on behalf of such Borrower) may from time
to time request Prime Rate Loans. Subject to the terms and conditions contained
herein, if Agent receives such a request on any Business Day, the Prime Rate
Loan requested in such request shall be made on such Business Day; provided,
that, if Agent receives such a request after 12:00 noon Chicago,
Illinois time on any Business Day, the Prime Rate Loan requested in such
request shall be made not later than the next succeeding Business Day. Each
Borrower (or Administrative Borrower on behalf of such Borrower) may from time
to time request Eurodollar Rate Loans or may request that Prime Rate Loans be
converted to Eurodollar Rate Loans or that any existing Eurodollar Rate Loans
continue for an additional Interest Period. Such request from a Borrower (or
Administrative Borrower on behalf of such Borrower) shall specify the amount of
the Eurodollar Rate Loans or the amount of the Prime Rate Loans to be converted
to Eurodollar Rate Loans or the amount of the Eurodollar Rate Loans to be
continued (subject to the limits set forth below) and the Interest Period to be
applicable to such Eurodollar Rate Loans. Subject to the terms and conditions
contained herein, three (3) Business Days after receipt by Agent of such a request
(or deemed request) from a Borrower (or Administrative Borrower on behalf of
such Borrower), such Eurodollar Rate Loans shall be made or Prime Rate Loans
shall be converted to Eurodollar Rate Loans or such Eurodollar Rate Loans shall
continue, as the case may be, provided, that, (i) no Default or
Event of Default shall have occurred and be continuing, (ii) such Borrower (or
Administrative Borrower on behalf of such Borrower) shall have complied with
such customary procedures as are reasonably established by Agent and specified
by Agent to Administrative Borrower from time to time for requests by Borrowers
for Eurodollar Rate Loans, (iii) no more than six (6) Interest Periods may be
in effect at any one time, (iv) the aggregate amount of the Eurodollar Rate
Loans must be in an amount not less than $1,000,000 or an integral multiple of
$1,000,000 in excess thereof, and (v) Agent shall have determined that the
Interest Period or Adjusted Eurodollar Rate is available and can be readily
determined as of the date of the request for such Eurodollar Rate Loan by such
Borrower. Any 


 


43

















 


request (or deemed
request) by or on behalf of a Borrower for Eurodollar Rate Loans or to convert
Prime Rate Loans to Eurodollar Rate Loans or to continue any existing
Eurodollar Rate Loans shall be irrevocable. Notwithstanding anything to the
contrary contained herein, Agent and Lenders shall not be required to purchase
United States Dollar deposits in the London interbank market or other
applicable Eurodollar Rate market to fund any Eurodollar Rate Loans, but the
provisions hereof shall be deemed to apply as if Agent and Lenders had
purchased such deposits to fund the Eurodollar Rate Loans.


 


(c)           Unless
Agent has received a request to the contrary from a Borrower (or Administrative
Borrower on behalf of such Borrower) at least three (3) Business Days prior to
the last day of the Interest Period for any Eurodollar Rate Loan,
Administrative Borrower shall, automatically and without any further action, be
deemed to have requested that the entire amount of such Eurodollar Rate Loan be
continued as a new Eurodollar Rate Loan having an Interest Period of one (1)
month; provided, that, if the conditions contained in Section
3.1(b) hereof with respect to the continuation of such Eurodollar Rate Loan are
not satisfied, then such Eurodollar Rate Loan shall automatically convert to
Prime Rate Loans upon the last day of the applicable Interest Period. Any
Eurodollar Rate Loans shall, at Agent’s option, upon notice by Agent to Parent,
be subsequently converted to Prime Rate Loans in the event that this Agreement
shall terminate or not be renewed. Borrowers shall pay to Agent, for the
benefit of Lenders, upon demand by Agent (or Agent may, at its option, charge
any loan account of any Borrower) any amounts required to compensate any Lender
or Participant for any loss (including loss of anticipated profits), cost or
expense incurred by such person, as a result of the conversion of Eurodollar
Rate Loans to Prime Rate Loans pursuant to any of the foregoing.


 


(d)           Interest
shall be payable by Borrowers to Agent, for the account of Lenders, monthly in
arrears not later than the first day of each calendar month and shall be
calculated on the basis of a three hundred sixty (360) day year (or, in the
case of Prime Rate Loans, a 365 or 366 day year, as the case may be) and actual
days elapsed. The interest rate on non-contingent Obligations (other than
Eurodollar Rate Loans) shall increase or decrease by an amount equal to each
increase or decrease in the Prime Rate effective on the day of any change in
such Prime Rate is announced. In no event shall charges constituting interest
payable by Borrowers to Agent and Lenders exceed the maximum amount or the rate
permitted under any applicable law or regulation, and if any such part or
provision of this Agreement is in contravention of any such law or regulation,
such part or provision shall be deemed amended to conform thereto.


 


3.2         Fees.


 


(a)           Borrowers
shall pay to Agent, for the account of Lenders, monthly an unused line fee at a
rate equal to one-quarter (.25%) percent per annum calculated upon the amount
by which the Maximum Credit exceeds the average daily principal balance of the
outstanding Revolving Loans and Letter of Credit Accommodations during the
immediately preceding month (or part thereof) while this Agreement is in effect
and for so long thereafter as any of the Obligations are outstanding, which fee
shall be payable on the first day of each month in arrears.


 


(b)           Borrowers
agree to pay to Agent the other fees and amounts set forth in the Fee Letter in
the amounts and at the times specified therein.


 


44

















 


3.3         Changes in Laws and Increased Costs
of Loans.


 


(a)           If after
the date hereof, either (i) any change in, or in the interpretation of, any law
or regulation is introduced, including, without limitation, with respect to
reserve requirements (other than reserve requirements to the extent reflected
in the Adjusted Eurodollar Rate as determined by Agent in good faith),
applicable to Lender or any banking or financial institution from whom any
Lender borrows funds or obtains credit (a “Funding Bank”), or (ii) a Funding
Bank or any Lender complies with any future guideline or request from any
central bank or other Governmental Authority or (iii) a Funding Bank or any
Lender determines that the adoption after the date hereof of any applicable
law, rule or regulation regarding capital adequacy, or any change therein, or any
change in the interpretation or administration thereof by any Governmental
Authority, central bank or comparable agency charged with the interpretation or
administration thereof has or would have the effect described below, or a
Funding Bank or any Lender complies with any request or directive regarding
capital adequacy (whether or not having the force of law) of any such
authority, central bank or comparable agency, and in the case of any event set
forth in this clause (iii), such adoption, change or compliance has or would
have the direct or indirect effect of reducing the rate of return on any Lender’s
capital as a consequence of its obligations hereunder to a level below that
which Lender could have achieved but for such adoption, change or compliance
(taking into consideration the Funding Bank’s or Lender’s policies with respect
to capital adequacy) by an amount deemed by such Lender to be material, and the
result of any of the foregoing events described in clauses (i), (ii) or (iii)
is or results in an increase in the cost to any Lender of funding or
maintaining the Loans, the Letter of Credit Accommodations or its Commitment,
then Borrowers and Guarantors shall from time to time, no later than ten (10)
Business Days following demand by Agent, pay to Agent additional amounts
sufficient to indemnify Lenders against such increased cost on an after-tax
basis (after taking into account applicable deductions and credits in respect
of the amount indemnified). A certificate as to the amount of such increased cost
shall be submitted to Administrative Borrower by Agent and shall be conclusive,
absent manifest error. Failure or delay on the part of Agent to demand
compensation pursuant to this Section 3.1(a) shall not constitute a waiver of
Agent’s right to demand such compensation; provided, that,
Borrowers and Guarantors shall not be required to compensate a Lender pursuant
to this Section 3.1(a) for any increased costs incurred more than nine months
prior to the date Agent notifies Administrative Borrower of such increased
costs (except, that, if the change in law or other event giving rise to such
increased costs is retroactive, then the nine-month period referred to above
shall be extended to include the period of retroactive effect thereof).


 


(b)           If
prior to the first day of any Interest Period, (i) Agent shall have determined
in good faith (which determination shall be conclusive and binding upon
Borrowers and Guarantors) that, by reason of circumstances affecting the
relevant market, adequate and reasonable means do not exist for ascertaining
the Adjusted Eurodollar Rate for such Interest Period, (ii) Agent has received
notice from the Required Lenders that Adjusted Eurodollar Rate determined or to
be determined for such Interest Period will not adequately and fairly reflect
the cost to Lenders of making or maintaining Eurodollar Rate Loans during such
Interest Period, or (iii) Dollar deposits in the principal amounts of the
Eurodollar Rate Loans to which such Interest Period is to be applicable are not
generally available in the London interbank market, Agent shall give telecopy
or telephonic notice thereof to Administrative Borrower as soon as practicable
thereafter, and will also give prompt written notice to Administrative Borrower
when such conditions no longer exist. If such notice is given (A) any
Eurodollar Rate Loans requested to be 


 


45

















 


made on the first
day of such Interest Period shall be made as Prime Rate Loans, (B) any Loans
that were to have been converted on the first day of such Interest Period to or
continued as Eurodollar Rate Loans shall be converted to or continued as Prime
Rate Loans and (C) each outstanding Eurodollar Rate Loan shall be converted, on
the last day of the then-current Interest Period thereof, to Prime Rate Loans. Until
such notice has been withdrawn by Agent, no further Eurodollar Rate Loans shall
be made or continued as such, nor shall any Borrower (or Administrative
Borrower on behalf of any Borrower) have the right to convert Prime Rate Loans
to Eurodollar Rate Loans.


 


(c)           Notwithstanding
any other provision herein, if the adoption of or any change in any law,
treaty, rule or regulation or final, non-appealable determination of an
arbitrator or a court or other Governmental Authority or in the interpretation
or application thereof occurring after the date hereof shall make it unlawful
for Agent or any Lender to make or maintain Eurodollar Rate Loans as
contemplated by this Agreement, (i) Agent or such Lender shall promptly give
written notice of such circumstances to Administrative Borrower (which notice
shall be withdrawn whenever such circumstances no longer exist), (ii) the
commitment of such Lender hereunder to make Eurodollar Rate Loans, continue
Eurodollar Rate Loans as such and convert Prime Rate Loans to Eurodollar Rate
Loans shall forthwith be canceled and, until such time as it shall no longer be
unlawful for such Lender to make or maintain Eurodollar Rate Loans, such Lender
shall then have a commitment only to make a Prime Rate Loan when a Eurodollar
Rate Loan is requested and (iii) such Lender’s Loans then outstanding as
Eurodollar Rate Loans, if any, shall be converted automatically to Prime Rate
Loans on the respective last days of the then current Interest Periods with
respect to such Loans or within such earlier period as required by law. If any
such conversion of a Eurodollar Rate Loan occurs on a day which is not the last
day of the then current Interest Period with respect thereto, Borrowers and
Guarantors shall pay to such Lender such amounts, if any, as may be required
pursuant to Section 3.3(d) below.


 


(d)           Borrowers
and Guarantors shall indemnify Agent and each Lender and to hold Agent and each
Lender harmless from any loss or expense which Agent or such Lender may sustain
or incur as a consequence of (i) default by Borrower in making a borrowing of,
conversion into or extension of Eurodollar Rate Loans after such Borrower (or
Administrative Borrower on behalf of such Borrower) has given a notice
requesting the same in accordance with the provisions of this Loan Agreement,
(ii) default by any Borrower in making any prepayment of a Eurodollar Rate Loan
after such Borrower has given a notice thereof in accordance with the
provisions of this Agreement, and (iii) the making of a prepayment of
Eurodollar Rate Loans on a day which is not the last day of an Interest Period
with respect thereto. With respect to Eurodollar Rate Loans, such
indemnification may include an amount equal to the excess, if any, of (A) the
amount of interest which would have accrued on the amount so prepaid, or not so
borrowed, converted or extended, for the period from the date of such
prepayment or of such failure to borrow, convert or extend to the last day of
the applicable Interest Period (or, in the case of a failure to borrow, convert
or extend, the Interest Period that would have commenced on the date of such
failure) in each case at the applicable rate of interest for such Eurodollar
Rate Loans provided for herein over (B) the amount of interest (as
determined by such Agent or such Lender) which would have accrued to Agent or
such Lender on such amount by placing such amount on deposit for a comparable
period with leading banks in the interbank Eurodollar market. This covenant
shall survive the termination or non-renewal of this Loan Agreement and the
payment of the Obligations.


 


46

















 


SECTION 4.           CONDITIONS
PRECEDENT


 


4.1           Conditions Precedent to Initial
Loans and Letter of Credit Accommodations. Each of the following is a
condition precedent to Agent and Lenders making the initial Loans and providing
the initial Letter of Credit Accommodations hereunder:


 


(a)           Agent
shall have received, in form and substance reasonably satisfactory to Agent,
all releases, terminations and such other documents as Agent may request to
evidence and effectuate the termination by any Person of any lien or security
interest in and to any assets and properties of a Borrower and Guarantor held
by such Person (other than liens and security interests permitted by Section
9.8 hereof), duly authorized, executed and delivered by such Person, including,
but not limited to, (i) UCC termination statements for all UCC financing
statements previously filed by such Person, as secured party and any Borrower
or Guarantor, as debtor; and (ii) satisfactions and discharges of any
mortgages, deeds of trust or deeds to secure debt by any Borrower or Guarantor
in favor of such Person, in form acceptable for recording with the appropriate
Governmental Authority;


 


(b)           all
requisite corporate action and proceedings in connection with this Agreement
and the other Financing Agreements shall be satisfactory in form and substance
to Agent, and Agent shall have received all information and copies of all
documents, including records of requisite corporate action and proceedings
which Agent may have requested in connection therewith, such documents where
requested by Agent or its counsel to be certified by appropriate corporate
officers or Governmental Authority (and including a copy of the certificate of
incorporation or formation of each Borrower and Guarantor certified by the
Secretary of State (or equivalent Governmental Authority) which shall set forth
the same complete name of such Borrower or Guarantor as is set forth herein and
such document as shall set forth the organizational identification number of
each Borrower or Guarantor, if one is issued in its jurisdiction of
incorporation);


 


(c)           no
material adverse change shall have occurred in the assets or business of
Borrowers since the date of Agent’s latest field examination (not including for
this purpose the field review referred to in clause (d) below) and no change or
event shall have occurred which would impair the ability of any Borrower or Obligor
to perform its obligations hereunder or under any of the other Financing
Agreements to which it is a party or of Agent or any Lender to enforce the
Obligations or realize upon the Collateral;


 


(d)           Agent
shall have completed a field review of the Records and such other information
with respect to the Collateral as Agent may require to determine the amount of
Loans available to Borrowers (including, without limitation, current perpetual
inventory records and/or roll-forwards of Accounts and Inventory through the
date of closing and test counts of the Inventory in a manner satisfactory to
Agent, together with such supporting documentation as may be necessary or
appropriate, and other documents and information that will enable Agent to
accurately identify and verify the Collateral), the results of which in each
case shall be satisfactory to Agent;


 


(e)           Agent
shall have received, in form and substance reasonably satisfactory to Agent,
all consents, waivers, acknowledgments and other agreements from third persons
which Agent may deem necessary or desirable in order to permit, protect and
perfect its security 


 


47

















 


interests in and
liens upon the Collateral or to effectuate the provisions or purposes of this
Agreement and the other Financing Agreements;


 


(f)            the
Excess Availability as determined by Agent, as of the date hereof, shall be not
less than $50,000,000 after giving effect to the initial Loans made or to be
made and Letter of Credit Accommodations issued or to be issued in connection
with the initial transactions hereunder;


 


(g)           Agent
shall have received, in form and substance reasonably satisfactory to Agent,
Deposit Account Control Agreements by and among Agent, each Borrower and
Guarantor, as the case may be and each bank where such Borrower (or Guarantor)
has a concentration account, in each case, duly authorized, executed and
delivered by such bank and Borrower or Guarantor, as the case may be (or Agent
shall be the bank ‘s customer with respect to such deposit account as Agent may
specify);


 


(h)           Agent
shall have received evidence, in form and substance reasonably satisfactory to
Agent, that Agent has a valid perfected first priority security interest in all
of the Collateral;


 


(i)            Agent
shall have received and reviewed lien and judgment search results for the
jurisdiction of organization of each Borrower and Guarantor, the jurisdiction
of the chief executive office of each Borrower and Guarantor and all
jurisdictions in which assets of Borrowers and Guarantors are located, which
search results shall be in form and substance reasonably satisfactory to Agent;


 


(j)            Agent
shall have received a written appraisal as to the Inventory of Borrowers by an
appraiser acceptable to Agent, in form, scope and methodology reasonably
acceptable to Agent, addressed to Agent and upon which Agent and Lenders are
expressly permitted to rely;


 


(k)           Agent
shall have received originals of the shares of the stock certificates (if any)
representing all of the issued and outstanding shares of the Capital Stock of
each Borrower and Guarantor (other than Parent) and owned by any Borrower or
Guarantor, in each case together with stock powers duly executed in blank with
respect thereto;


 


(l)            Agent
shall have received evidence of insurance and loss payee endorsements required
hereunder and under the other Financing Agreements, in form and substance
reasonably satisfactory to Agent, and certificates of insurance policies and/or
endorsements naming Agent as loss payee;


 


(m)          Agent
shall have received, in form and substance satisfactory to Agent, projected
income statements, balance sheets and statements of cash flow for Parent and
its Subsidiaries (on a consolidated basis) prepared on a quarterly basis for
the period through the end of the 2008 fiscal year and thereafter, on an annual
basis for each fiscal year through the end of the 2011 fiscal year, in each
case with the results and assumptions set forth in all of such projections in
form and substance reasonably satisfactory to Agent;


 


(n)           Agent
shall have received a Borrowing Base Certificate setting forth the Revolving
Loans and Letter of Credit Accommodations available to Borrowers as of the date



 


48

















 


hereof as
completed in a manner reasonably satisfactory to Agent and duly authorized,
executed and delivered on behalf of Administrative Borrower;


 


(o)           Agent
shall have received, in form and substance reasonably satisfactory to Agent,
such opinion letters of counsel to Borrowers and Guarantors with respect to the
Financing Agreements and such other matters as Agent may request; and


 


(p)           the
other Financing Agreements and all instruments and documents hereunder and
thereunder shall have been duly executed and delivered to Agent, in form and
substance reasonably satisfactory to Agent.


 


4.2           Conditions Precedent to All Loans
and Letter of Credit Accommodations. Each of the following is an additional
condition precedent to the Loans and/or providing Letter of Credit
Accommodations to Borrowers, including the initial Loans and Letter of Credit
Accommodations and any future Loans and Letter of Credit Accommodations:


 


(a)           all
representations and warranties contained herein and in the other Financing
Agreements shall be true and correct in all material respects with the same
effect as though such representations and warranties had been made on and as of
the date of the making of each such Loan or providing each such Letter of
Credit Accommodation and after giving effect thereto, except to the extent that
such representations and warranties expressly relate solely to an earlier date
(in which case such representations and warranties shall have been true and
accurate on and as of such earlier date);


 


(b)           no
law, regulation, order, judgment or decree of any Governmental Authority shall
exist, and no action, suit, investigation, litigation or proceeding shall be
pending or threatened in any court or before any arbitrator or Governmental
Authority, which (i) purports to enjoin, prohibit, restrain or otherwise affect
(A) the making of the Loans or providing the Letter of Credit Accommodations,
or (B) the consummation of the transactions contemplated pursuant to the terms
hereof or the other Financing Agreements or (ii) has or has a reasonable
likelihood of having a Material Adverse Effect; and


 


(c)           no
Default or Event of Default shall have occurred and be continuing on and as of
the date of the making of such Loan or providing each such Letter of Credit
Accommodation and after giving effect thereto.


 


SECTION 5.           GRANT AND
PERFECTION OF SECURITY INTEREST


 


5.1           Grant of Security Interest. To
secure payment and performance of all Obligations, each Borrower and Guarantor
hereby grants to Agent, for itself and the benefit of Secured Parties, a
continuing security interest in, a lien upon, and a right of set off against,
and hereby assigns to Agent, for itself and the benefit of Secured Parties, as
security, all personal property, and interests in personal property, of each
Borrower and Guarantor, whether now owned or hereafter acquired or existing,
and wherever located (together with all other collateral security for the
Obligations at any time granted to or held or acquired by Agent or any Lender,
but subject to the exclusions contained in the last paragraph of this Section,
collectively, the “Collateral”), including:


 


(a)           all
Accounts;


 


49

















 


(b)           all
general intangibles, including, without limitation, all Intellectual Property;


 


(c)           all
goods, including, without limitation, Inventory and Equipment;


 


(d)           all
chattel paper, including, without limitation, all tangible and electronic
chattel paper;


 


(e)           all
instruments, including, without limitation, all promissory notes;


 


(f)            all
documents;


 


(g)           all
deposit accounts;


 


(h)           all
letters of credit, banker’s acceptances and similar instruments and including
all letter-of-credit rights;


 


(i)            all
supporting obligations and all present and future liens, security interests,
rights, remedies, title and interest in, to and in respect of Receivables and
other Collateral, including (i) rights and remedies under or relating to
guaranties, contracts of suretyship, letters of credit and credit and other
insurance related to the Collateral, (ii) rights of stoppage in transit,
replevin, repossession, reclamation and other rights and remedies of an unpaid
vendor, lienor or secured party, (iii) goods described in invoices, documents,
contracts or instruments with respect to, or otherwise representing or
evidencing, Receivables or other Collateral, including returned, repossessed
and reclaimed goods, and (iv) deposits by and property of account debtors or
other persons securing the obligations of account debtors;


 


(j)            all
(i) investment property (including securities, whether certificated or
uncertificated, securities accounts, security entitlements, commodity contracts
or commodity accounts) and (ii) monies, credit balances, deposits and other
property of any Borrower or Guarantor now or hereafter held or received by or
in transit to Agent, any Lender or its Affiliates or at any other depository or
other institution from or for the account of any Borrower or Guarantor, whether
for safekeeping, pledge, custody, transmission, collection or otherwise;


 


(k)           all
commercial tort claims, including, without limitation, those identified in the
Information Certificate;


 


(l)            to
the extent not otherwise described above, all Receivables;


 


(m)          all
Records; and


 


(n)           all
products and proceeds of the foregoing, in any form, including insurance
proceeds and all claims against third parties for loss or damage to or
destruction of or other involuntary conversion of any kind or nature of any or
all of the other Collateral.


 


Notwithstanding anything to the contrary contained in
this Agreement or any of the other Financing Agreements, the security interest
in, lien upon, and right of setoff against, any Collateral of the Petro
Companies or any Capital Stock in Petro granted pursuant to this Agreement and
the other Financing Agreements shall not become effective until the Petro Lien 


 


50

















 


Effective Date, at
which time each such grant shall automatically become effective without the
need for any further action, consent or otherwise.


 


Notwithstanding anything to the contrary contained in
this Section 5.1, the Collateral consisting of Capital Stock of any Foreign
Subsidiary of any Borrower or Guarantor shall not exceed sixty five (65%)
percent of the issued and outstanding Capital Stock of such Foreign Subsidiary.
Notwithstanding anything to the contrary contained in this Section 5.1, the
types or items of Collateral described in such Section shall not include (a)
any Excluded Assets; and (b) any rights or interest in any contract, lease,
permit, license, charter or license agreement covering real or personal
property of a Borrower of a Guarantor, as such, if under the items of such
contract, lease, permit, license, charter or license agreement, or applicable
law with respect thereto, the valid grant of a security interest or lien
therein to Agent is prohibited and such prohibition has not been or is not
waived or the consent of the other party to such contract, lease, permit,
license, charter or license agreement has not been or is not otherwise
obtained; provided, that, the foregoing exclusion shall in no way
be construed (i) to apply if any such prohibition is unenforceable under the
UCC or other applicable law or (ii) so as to limit, impair or otherwise affect
Agent’s unconditional continuing security interests in and liens upon any
rights or interests of such Borrower or Guarantor in or to monies due or to
become due under such contract, lease, permit, license, charter or license
agreement (including any Receivables).


 


5.2         Perfection of Security Interests.


 


(a)           Each
Borrower and Guarantor irrevocably and unconditionally authorizes Agent (or its
agent) to file at any time and from time to time such financing statements with
respect to the Collateral naming Agent or its designee as the secured party and
such Borrower or Guarantor as debtor, as Agent may require, and including any
other information with respect to such Borrower or Guarantor or otherwise
required by part 5 of Article 9 of the Uniform Commercial Code of such
jurisdiction as Agent may determine, together with any amendment and continuations
with respect thereto, which authorization shall apply to all financing
statements filed on, prior to or after the date hereof. Each Borrower and
Guarantor hereby ratifies and approves all financing statements naming Agent or
its designee as secured party and such Borrower or Guarantor, as the case may
be, as debtor with respect to the Collateral (and any amendments with respect
to such financing statements) filed by or on behalf of Agent prior to the date
hereof and ratifies and confirms the authorization of Agent to file such
financing statements (and amendments, if any). Each Borrower and Guarantor
hereby authorizes Agent to adopt on behalf of such Borrower and Guarantor any
symbol required for authenticating any electronic filing. In the event that the
description of the collateral in any financing statement naming Agent or its
designee as the secured party and any Borrower or Guarantor as debtor includes
assets and properties of such Borrower or Guarantor that do not at any time
constitute Collateral, whether hereunder, under any of the other Financing
Agreements or otherwise, the filing of such financing statement shall
nonetheless be deemed authorized by such Borrower or Guarantor to the extent of
the Collateral included in such description and it shall not render the
financing statement ineffective as to any of the Collateral or otherwise affect
the financing statement as it applies to any of the Collateral. In no event
shall any Borrower or Guarantor at any time file, or permit or cause to be
filed, any correction statement or termination statement with respect to any
financing statement (or amendment or continuation with respect thereto) naming
Agent or its designee as secured party and such Borrower or Guarantor as
debtor.


 


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(b)           Each
Borrower and Guarantor does not have any chattel paper (whether tangible or
electronic) or instruments as of the date hereof, except as set forth in the
Information Certificate. In the event that any Borrower or Guarantor shall be
entitled to or shall receive any chattel paper or instrument after the date
hereof with a value in excess of $500,000 individually or $1,000,000 in the
aggregate (or, if an Event of Default has occurred and is continuing, then with
any value), Borrowers and Guarantors shall promptly notify Agent thereof in
writing. Promptly upon the receipt thereof by or on behalf of any Borrower or
Guarantor (including by any agent or representative), such Borrower or
Guarantor shall deliver, or cause to be delivered to Agent, all tangible
chattel paper and instruments that such Borrower or Guarantor has or may at any
time acquire, accompanied by such instruments of transfer or assignment duly
executed in blank as Agent may from time to time specify, in each case except
as Agent may otherwise agree. At Agent’s option, each Borrower and Guarantor
shall, or Agent may at any time on behalf of any Borrower or Guarantor, cause
the original of any such instrument or chattel paper to be conspicuously marked
in a form and manner acceptable to Agent with the following legend referring to
chattel paper or instruments as applicable: “This [chattel paper][instrument]
is subject to the security interest of Wachovia Capital Finance Corporation
(Central), as Agent and any sale, transfer, assignment or encumbrance of this
[chattel paper][instrument] violates the rights of such secured party.”


 


(c)           In
the event that any Borrower or Guarantor shall at any time hold or acquire an
interest in any electronic chattel paper or any “transferable record” (as such
term is defined in Section 201 of the Federal Electronic Signatures in Global
and National Commerce Act or in Section 16 of the Uniform Electronic
Transactions Act as in effect in any relevant jurisdiction), such Borrower or
Guarantor shall promptly notify Agent thereof in writing. Promptly upon Agent’s
request, such Borrower or Guarantor shall take, or cause to be taken, such
actions as Agent may request to give Agent control of such electronic chattel
paper under Section 9-105 of the UCC and control of such transferable record
under Section 201 of the Federal Electronic Signatures in Global and National
Commerce Act or, as the case may be, Section 16 of the Uniform Electronic
Transactions Act, as in effect in such jurisdiction.


 


(d)           Each
Borrower and Guarantor does not have any deposit accounts as of the date
hereof, except as set forth in the Information Certificate. Borrowers and
Guarantors shall not, directly or indirectly, after the date hereof open,
establish or maintain any deposit account unless each of the following
conditions is satisfied: (i) Agent shall have received not less than five (5)
Business Days prior written notice of the intention of any Borrower or
Guarantor to open or establish such account which notice shall specify in
reasonable detail and specificity acceptable to Agent the name of the account,
the owner of the account, the name and address of the bank at which such
account is to be opened or established, the individual at such bank with whom
such Borrower or Guarantor is dealing and the purpose of the account, except
as to any Store Account opened or established after the date hereof, so long as
no Event of Default shall have occurred and be continuing, Agent shall only
have received such information as to such Store Account on the next monthly
report with respect to deposit accounts in accordance with Section 7.1(a)
hereof, (ii) the bank where such account is opened or maintained shall be
acceptable to Agent, and (iii) on or before the opening of such deposit account
(other than a Store Account or a disbursement account so long as no Event or
Default shall exist or have occurred and be continuing or so long as such Store
Account or disbursement account is not maintained at a bank which also
maintains a collection, lockbox or concentration account of a Borrower or
Guarantor) such Borrower or Guarantor shall deliver to Agent a Deposit Account 


 


52

















 


Control Agreement
with respect to such deposit account duly authorized, executed and delivered by
such Borrower or Guarantor and the bank at which such deposit account is opened
and maintained. The terms of this subsection (d) shall not apply to escrow
accounts, petty cash accounts, or deposit accounts specifically and exclusively
used for lottery payments, payroll, payroll taxes, workers compensation
insurance payments and other employee wage and benefit payments to or for the
benefit of any Borrower’s or Guarantor’s salaried employees.


 


(e)           No
Borrower or Guarantor owns or holds, directly or indirectly, beneficially or as
record owner or both, any investment property, as of the date hereof, or have
any investment account, securities account, commodity account or other similar
account with any bank or other financial institution or other securities
intermediary or commodity intermediary as of the date hereof, in each case
except as set forth in the Information Certificate.


 


(f)            In
the event that any Borrower or Guarantor shall be entitled to or shall at any
time after the date hereof hold or acquire any certificated securities (other
than securities consisting of Excluded Assets or consisting of Capital Stock of
any Excluded Subsidiary), such Borrower or Guarantor shall promptly endorse,
assign and deliver the same to Agent, accompanied by such instruments of
transfer or assignment duly executed in blank as Agent may from time to time
specify. If any securities (other than securities consisting of Excluded Assets
or consisting of Capital Stock of any Excluded Subsidiary), now or hereafter
acquired by any Borrower or Guarantor are uncertificated and are issued to such
Borrower or Guarantor or its nominee directly by the issuer thereof, such
Borrower or Guarantor shall immediately notify Agent thereof and shall as Agent
may specify, either (A) cause the issuer to agree to comply with instructions
from Agent as to such securities, without further consent of any Borrower or
Guarantor or such nominee, or (B) arrange for Agent to become the registered
owner of the securities.


 


(g)           Borrowers
and Guarantors shall not, directly or indirectly, after the date hereof open,
establish or maintain any investment account, securities account, commodity
account or any other similar account (other than a deposit account or a
Customer Loyalty Account) with any securities intermediary or commodity
intermediary unless each of the following conditions is satisfied: (A) Agent
shall have received not less than five (5) Business Days prior written notice
of the intention of such Borrower or Guarantor to open or establish such
account which notice shall specify in reasonable detail and specificity
acceptable to Agent the name of the account, the owner of the account, the name
and address of the securities intermediary or commodity intermediary at which
such account is to be opened or established, the individual at such
intermediary with whom such Borrower or Guarantor is dealing and the purpose of
the account, (B) the securities intermediary or commodity intermediary (as the
case may be) where such account is opened or maintained shall be acceptable to
Agent, and (C) on or before the opening of such investment account, securities
account or other similar account with a securities intermediary or commodity
intermediary, such Borrower or Guarantor shall as Agent may specify either (1)
execute and deliver, and cause to be executed and delivered to Agent, an
Investment Property Control Agreement with respect thereto duly authorized,
executed and delivered by such Borrower or Guarantor and such securities
intermediary or commodity intermediary or (2) arrange for Agent to become the
entitlement holder with respect to such investment property on terms and
conditions acceptable to Agent.


 


(h)           Borrowers
and Guarantors are not the beneficiary or otherwise entitled to any right to
payment under any letter of credit, banker’s acceptance or similar instrument
as of 


 


53

















 


the date hereof,
except as set forth in the Information Certificate. In the event that any
Borrower or Guarantor shall be entitled to or shall receive any right to
payment under any letter of credit, banker’s acceptance or any similar
instrument, whether as beneficiary thereof or otherwise after the date hereof,
such Borrower or Guarantor shall promptly notify Agent thereof in writing. Such
Borrower or Guarantor shall immediately, as Agent may specify, either (i)
deliver, or cause to be delivered to Agent, with respect to any such letter of
credit, banker’s acceptance or similar instrument, the written agreement of the
issuer and any other nominated person obligated to make any payment in respect
thereof (including any confirming or negotiating bank), in form and substance
reasonably satisfactory to Agent, consenting to the assignment of the proceeds
of the letter of credit to Agent by such Borrower or Guarantor and agreeing to
make all payments thereon directly to Agent or as Agent may otherwise direct or
(ii) cause Agent to become, at Borrowers’ expense, the transferee beneficiary
of the letter of credit, banker’s acceptance or similar instrument (as the case
may be).


 


(i)            Borrowers
and Guarantors do not have any commercial tort claims as of the date hereof,
except as set forth in the Information Certificate. In the event that any
Borrower or Guarantor shall at any time after the date hereof have any
commercial tort claims that arise in connection with or relate to any assets
which are or were at any time included in the calculation of the Borrowing
Base, such Borrower or Guarantor shall promptly notify Agent thereof in
writing, which notice shall (i) set forth in reasonable detail the basis for
and nature of such commercial tort claim and (ii) include the express grant by
such Borrower or Guarantor to Agent of a security interest in such commercial
tort claim (and the proceeds thereof). In the event that such notice does not
include such grant of a security interest, the sending thereof by such Borrower
or Guarantor to Agent shall be deemed to constitute such grant to Agent. Upon
the sending of such notice, any commercial tort claim described therein shall
constitute part of the Collateral and shall be deemed included therein. Without
limiting the authorization of Agent provided in Section 5.2(a) hereof or
otherwise arising by the execution by such Borrower or Guarantor of this
Agreement or any of the other Financing Agreements, Agent is hereby irrevocably
authorized from time to time and at any time to file such financing statements
naming Agent or its designee as secured party and such Borrower or Guarantor as
debtor, or any amendments to any financing statements, covering any such
commercial tort claim as Collateral. In addition, each Borrower and Guarantor
shall promptly upon Agent’s request, execute and deliver, or cause to be
executed and delivered, to Agent such other agreements, documents and
instruments as Agent may require in connection with such commercial tort claim.


 


(j)            Borrowers
and Guarantors do not have any goods, documents of title or other Collateral in
the custody, control or possession of a third party as of the date hereof,
except as set forth in the Information Certificate and except for goods located
in the United States in transit to a location of a Borrower or Guarantor
permitted herein in the ordinary course of business of such Borrower or Guarantor
in the possession of the Person transporting such goods. In the event that any
goods, documents of title or other Collateral are at any time after the date
hereof in the custody, control or possession of any other person not referred
to in the Information Certificate or such carriers, Borrowers and Guarantors
shall promptly notify Agent thereof in writing and such goods shall not
constitute Eligible Inventory or Eligible Equipment unless the criteria for
Eligible Equipment or Eligible Equipment (as the case may be) have been
satisfied. Promptly upon Agent’s request, Borrowers and Guarantors shall use
commercially reasonable efforts to deliver to Agent a Collateral Access
Agreement duly authorized, executed and delivered by such person and the
Borrower or Guarantor that is the owner of such Collateral,


 


54
















 


except that
Borrowers and Guarantors shall not be required to use such efforts to deliver a
Collateral Access Agreement with respect to a retail store location opened
after the date hereof unless such retail store location is leased from HPT or
any of its Affiliates.


 


(k)           Borrowers
and Guarantors shall take any other actions reasonably requested by Agent from
time to time to cause the attachment, perfection and first priority of, and the
ability of Agent to enforce, the security interest of Agent in any and all of
the Collateral, including, without limitation, (i) executing, delivering and,
where appropriate, filing financing statements and amendments relating thereto
under the UCC or other applicable law, to the extent, if any, that any Borrower’s
or Guarantor’ s signature thereon is required therefore, (ii) complying with
any provision of any statute, regulation or treaty of the United States as to
any Collateral if compliance with such provision is a condition to attachment,
perfection or priority of, or ability of Agent to enforce, the security
interest of Agent in such Collateral, and (iii) obtaining the consents and
approvals of any Governmental Authority or third party, including, without
limitation, any consent of any licensor, lessor or other person obligated on
Collateral, and taking all actions required by any earlier versions of the UCC
or by other law, as applicable in any relevant jurisdiction.


 


SECTION 6.                                COLLECTION
AND ADMINISTRATION


 


6.1           Borrowers’
Loan Accounts. Agent shall maintain one or more loan account(s) on its
books in which shall be recorded (a) all Loans, Letter of Credit Accommodations
and other Obligations and the Collateral, (b) all payments made by or on behalf
of any Borrower or Guarantor and (c) all other appropriate debits and credits
as provided in this Agreement, including fees, charges, costs, expenses and
interest. All entries in the loan account(s) shall be made in accordance with
Agent’s customary practices as in effect from time to time.


 


6.2           Statements.
Agent shall render to Administrative Borrower each month a statement setting
forth the balance in the Borrowers’ loan account(s) maintained by Agent for
Borrowers pursuant to the provisions of this Agreement, including principal,
interest, fees, costs and expenses. Each such statement shall, absent manifest
errors or omissions, be conclusively binding upon Borrowers and Guarantors as
an account stated except to the extent that Agent receives a written notice
from Administrative Borrower of any specific exceptions of Administrative
Borrower thereto within sixty (60) days after the date such statement has been
received by Administrative Borrower. Until such time as Agent shall have
rendered to Administrative Borrower a written statement as provided above, the
balance in any Borrower’s loan account(s) shall be presumptive evidence of the
amounts due and owing to Agent and Lenders by Borrowers and Guarantors.


 


6.3           Collection
of Accounts.


 


(a)           Each
Borrower and Guarantor shall establish and maintain, at its expense, deposit
account arrangements and merchant payment arrangements with the banks set forth
on Schedule 8.10 to the Information Certificate and, subject to Section 5.2(d)
hereof, such other banks as such Borrower or Guarantor may hereafter select. The
banks set forth on Schedule 8.10 to the Information Certificate constitute all
of the banks with which Borrowers and Guarantors have deposit account
arrangements and merchant payment arrangements as of the date hereof and
identifies each of the deposit accounts at such banks that are used solely for
receiving store receipts from a retail store location of a Borrower (together
with any other deposit accounts at 


 


55

















 


any time
established or used by any Borrower for receiving such store receipts from any
retail store location, collectively, the “Store Accounts” and each
individually, a “Store Account”) or otherwise describes the nature of the use
of such deposit account by such Borrower.


 


(b)           Each
Borrower shall deposit all proceeds of Collateral in every form, including,
without limitation, cash, checks, credit card sales drafts, credit card sales
or charge slips or receipts and other forms of daily store receipts, from each
retail store location of such Borrower on each Business Day into the Store
Account of such Borrower used solely for such purpose; provided, that,
the retail stores of Borrowers shall be permitted to retain cash at such retail
stores in an aggregate amount as to all such retail stores equal to the product
of $40,000 multiplied by the number of such retail stores, immediately after
giving effect to the deposit of funds from such store into the applicable Store
Account. All such available funds deposited into the Store Accounts shall be
sent by wire transfer or other electronic funds transfer on each Business Day
to the Blocked Accounts as provided in Section 6.3(c), except for amounts
required to be maintained in such Store Accounts under the terms of such
Borrower’s arrangements with the bank at which such Store Accounts are
maintained (which amounts in all such Store Accounts in the aggregate shall not
at any time exceed the product of $50,000 multiplied by the number of the
retail stores of Borrowers).


 


(c)           Each
Borrower shall establish and maintain, at its expense, deposit accounts with
such banks as are acceptable to Agent (the “Blocked Accounts”) into which each
Borrower shall promptly either cause all amounts on deposit in the Store
Accounts of such Borrower to be sent as provided in Section 6.3(b) above  or shall itself deposit or cause to be
deposited all proceeds of Collateral, including all proceeds from sales of
Inventory, all amounts payable to each Borrower from Credit Card Issuers and
Credit Card Processors and all other proceeds of Collateral (it being
understood that the banks listed on Schedule 8.10 to the Information
Certificate are acceptable to Agent for purposes of this Section). Borrowers
and Guarantors shall deliver, or cause to be delivered to Agent a Deposit
Account Control Agreement duly authorized, executed and delivered by each bank
where a Blocked Account is maintained as provided in Section 5.2 hereof. At any
time an Event of Default shall have occurred and be continuing, promptly upon
Agent’s request, Borrowers and Guarantors shall deliver, or cause to be
delivered, to Agent a Deposit Account Control Agreement duly authorized,
executed and delivered by such banks where a Store Account is maintained as
Agent shall specify. Without limiting any other rights or remedies of Agent or
Lenders, Agent may, at its option, instruct the depository banks at which the
Blocked Accounts are maintained to transfer all available funds received or
deposited into the Blocked Accounts to the Agent Payment Account at any time
that a Cash Dominion Period exists. Without limiting any other rights or
remedies of Agent or Lenders, in the event that a Deposit Account Control
Agreement is in effect for a Store Account, then Agent may, at its option,
instruct the depository bank at which the Store Account is maintained to
transfer all available funds received or deposited into the Store Account to
the Agent Payment Account at any time that an Event of Default shall have
occurred and be continuing. At all times that Agent shall have notified any
depository bank to transfer funds from a Blocked Account or Store Account to
the Agent Payment Account, all payments made to such Blocked Accounts or Store
Accounts, whether in respect of the Receivables, as proceeds of Inventory or
other Collateral or otherwise shall be treated as payments to Agent in respect
of the Obligations and therefore shall constitute the property of Agent and
Lenders to the extent of the then outstanding Obligations.


 


56

















 


(d)           For
purposes of calculating the amount of the Loans available to each Borrower, all
payments received in the Agent Payment Account will be applied (conditional
upon final collection) to the Obligations on the Business Day of receipt by
Agent of immediately available funds in the Agent Payment Account provided such
payments and notice thereof are received in accordance with Agent’s usual and
customary practices as in effect from time to time and within sufficient time
to credit such Borrower’s loan account on such day, and if not, then on the
next Business Day. For the purposes of calculating interest on the Obligations,
such payments or other funds received will be applied (conditional upon final
collection) to the Obligations on the Business Day of receipt of immediately
available funds by Agent in the Agent Payment Account provided such payments or
other funds and notice thereof are received in accordance with Agent’s usual
and customary practices as in effect from time to time and within sufficient
time to credit such Borrower’s loan account on such day, and if not, then on
the next Business Day.


 


(e)           Each
Borrower and Guarantor and their respective Subsidiaries shall, acting as
trustee for Agent, receive, as the property of Agent, any monies, checks,
notes, drafts or any other payment relating to and/or proceeds of Accounts or
other Collateral which come into their possession or under their control and
promptly upon receipt thereof shall deposit or cause the same to be deposited
in the Store Accounts or the Blocked Accounts in accordance with Sections
6.3(b) and (c) hereof. In no event shall the same be commingled with any
Borrower’s or Guarantor’s other funds. Borrowers agree to reimburse Agent on
demand for any amounts owed or paid to any bank or other financial institution
at which a Blocked Account or any other deposit account or investment account
is established or any other bank, financial institution or other person
involved in the transfer of funds to or from the Blocked Accounts arising out
of Agent’s payments to or indemnification of such bank, financial institution
or other person. The obligations of Borrowers to reimburse Agent for such
amounts pursuant to this Section 6.3 shall survive the termination of this
Agreement.


 


6.4           Payments.


 


(a)           All
Obligations shall be payable to the Agent Payment Account as provided in
Section 6.3 or such other place as Agent may designate from time to time. Subject
to the other terms and conditions contained herein, Agent shall apply payments
received or collected from any Borrower or Guarantor or for the account of any
Borrower or Guarantor (including the monetary proceeds of collections or of
realization upon any Collateral) as follows: first, to pay any fees,
indemnities or expense reimbursements then due to Agent and Lenders from any
Borrower or Guarantor; second, to pay interest due in respect of any
Loans (and including any Special Agent Advances); third, to pay or
prepay principal in respect of Special Agent Advances; fourth, on a pro
rata basis, to the payment or prepayment of principal in respect of the
Revolving Loans then due and to the payment or prepayment of Obligations then
due arising under or pursuant to any Hedge Agreement (but, as to Obligations
arising under or pursuant to any Hedge Agreement, only up to the amount of any
effective Reserve established in respect of such Obligations); fifth, to
pay or prepay any other Obligations (but excluding for this purpose any
Obligations arising under or pursuant to Bank Products) whether or not then
due, in such order and manner as Agent determines and, at any time an Event of
Default has occurred and is continuing, to be held as cash collateral in
connection with any Letter of Credit; and sixth, to pay Obligations
arising under or pursuant to any Bank Product (other than to the extent
provided for above) on a pro rata basis. So long as no Default or Event of
Default shall have 


 


57

















 


occurred and be
continuing, the immediately preceding sentence shall not be deemed to apply to
any payment by Borrowers specified by Administrative Borrower to be for the
payment of the principal of or interest on any of the Loans. Notwithstanding
anything to the contrary contained in this Agreement, (i) unless so directed by
Administrative Borrower, or unless a Default or an Event of Default shall have
occurred and be continuing, Agent shall not apply any payments which it
receives to any Eurodollar Rate Loans, except (A) on the expiration date of the
Interest Period applicable to any such Eurodollar Rate Loans or (B) in the
event that there are no outstanding Prime Rate Loans and (ii) to the extent any
Borrower uses any proceeds of the Loans or Letter of Credit Accommodations to
acquire rights in or the use of any Collateral or to repay any Indebtedness
used to acquire rights in or the use of any Collateral, payments in respect of
the Obligations shall be deemed applied first to the Obligations arising from
Loans and Letter of Credit Accommodations that were not used for such purposes
and second to the Obligations arising from Loans and Letter of Credit
Accommodations the proceeds of which were used to acquire rights in or the use
of any Collateral in the chronological order in which such Borrower acquired
such rights in or the use of such Collateral.


 


(b)           At
Agent’s option, all principal, interest, fees, costs, expenses and other
charges provided for in this Agreement or the other Financing Agreements may be
charged directly to the loan account(s) of any Borrower maintained by Agent. If
after receipt of any payment of, or proceeds of Collateral applied to the
payment of, any of the Obligations, Agent or any Lender is required to
surrender or return such payment or proceeds to any Person for any reason, then
the Obligations intended to be satisfied by such payment or proceeds shall be
reinstated and continue and this Agreement shall continue in full force and
effect as if such payment or proceeds had not been received by Agent or such
Lender. Borrowers and Guarantors shall be liable to pay to Agent, and do hereby
indemnify and hold Agent and Lenders harmless for the amount of any payments or
proceeds surrendered or returned. This Section 6.4(b) shall remain effective
notwithstanding any contrary action which may be taken by Agent or any Lender
in reliance upon such payment or proceeds. This Section 6.4 shall survive the
payment of the Obligations and the termination of this Agreement.


 


6.5           Authorization
to Make Loans. Agent and Lenders are authorized to make the Loans and
provide the Letter of Credit Accommodations based upon telephonic or other
instructions received from anyone purporting to be an officer of Administrative
Borrower or any Borrower or other authorized person or, at the discretion of
Agent, if such Loans are necessary to satisfy any Obligations then due and payable.
All requests for Loans or Letter of Credit Accommodations hereunder shall
specify the date on which the requested advance is to be made or Letter of
Credit Accommodations established (which day shall be a Business Day) and the
amount of the requested Loan. Requests received after 12:00 noon Chicago,
Illinois time on any day shall be deemed to have been made as of the opening of
business on the immediately following Business Day. All Loans and Letter of
Credit Accommodations under this Agreement shall be conclusively presumed to
have been made to, and at the request of and for the benefit of, any Borrower
or Guarantor when deposited to the credit of any Borrower or Guarantor or
otherwise disbursed or established in accordance with the instructions of any Borrower
or Guarantor or in accordance with the terms and conditions of this Agreement.


 


6.6           Use
of Proceeds. All Loans made or Letter of Credit Accommodations provided to
or for the benefit of any Borrower pursuant to the provisions hereof shall be
used by such Borrower only for general operating, working capital, and other
proper corporate purposes of any 


 


58

















 


Borrower or Guarantor not otherwise prohibited by the terms hereof. None
of the proceeds will be used, directly or indirectly, for the purpose of
purchasing or carrying any margin security or for the purposes of reducing or
retiring any indebtedness which was originally incurred to purchase or carry
any margin security or for any other purpose which might cause any of the Loans
to be considered a “purpose credit” within the meaning of Regulation U of the
Board of Governors of the Federal Reserve System, as amended.


 


6.7          Appointment of Administrative
Borrower as Agent for Requesting Loans and Receipts of Loans and Statements.


 


(a)           Each
Borrower hereby irrevocably appoints and constitutes Administrative Borrower as
its agent to request and receive Loans and Letter of Credit Accommodations
pursuant to this Agreement and the other Financing Agreements from Agent or any
Lender in the name or on behalf of such Borrower. Agent and Lenders may
disburse the Loans to such bank account of Administrative Borrower or a
Borrower or otherwise make such Loans to a Borrower and provide such Letter of
Credit Accommodations to a Borrower as Administrative Borrower may designate or
direct, without notice to any other Borrower or Obligor. Notwithstanding
anything to the contrary contained herein, Agent may at any time and from time
to time require that Loans to or for the account of any Borrower be disbursed
directly to an operating account of such Borrower.


 


(b)           Administrative
Borrower hereby accepts the appointment by Borrowers to act as the agent of
Borrowers pursuant to this Section 6.7. Administrative Borrower shall ensure that
the disbursement of any Loans to each Borrower requested by or paid to or for
the account of Parent, or the issuance of any Letter of Credit Accommodations
for a Borrower hereunder, shall be paid to or for the account of such Borrower.


 


(c)           Each
Borrower and other Guarantor hereby irrevocably appoints and constitutes
Administrative Borrower as its agent to receive statements on account and all
other notices from Agent and Lenders with respect to the Obligations or
otherwise under or in connection with this Agreement and the other Financing
Agreements.


 


(d)           Any
notice, election, representation, warranty, agreement or undertaking by or on
behalf of any other Borrower or any Guarantor by Administrative Borrower shall
be deemed for all purposes to have been made by such Borrower or Guarantor, as
the case may be, and shall be binding upon and enforceable against such
Borrower or Guarantor to the same extent as if made directly by such Borrower
of Guarantor.


 


(e)           No
purported termination of the appointment of Administrative Borrower as agent as
aforesaid shall be effective, except after ten (10) days’ prior written notice
to Agent.


 


6.8          Pro Rata Treatment. Except to
the extent otherwise provided in this Agreement:  (a) the making and conversion of Loans
shall be made among the Lenders based on their respective Pro Rata Shares as to
the Loans and (b) each payment on account of any Obligations to or for the
account of one or more of Lenders in respect of any Obligations due on a
particular day shall be allocated among the Lenders entitled to such payments
based on their respective Pro Rata Shares and shall be distributed accordingly.


 


6.9          Sharing of Payments, Etc.


 


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(a)           Each
Borrower and Guarantor agrees that, in addition to (and without limitation of)
any right of setoff, banker’s lien or counterclaim Agent or any Lender may
otherwise have, each Lender shall be entitled, at its option (but subject, as
among Agent and Lenders, to the provisions of Section 12.3(b) hereof), to
offset balances held by it for the account of such Borrower or Guarantor at any
of its offices, in dollars or in any other currency, against any principal of
or interest on any Loans owed to such Lender or any other amount payable to
such Lender hereunder, that is not paid when due (regardless of whether such
balances are then due to such Borrower or Guarantor), in which case it shall
promptly notify Administrative Borrower and Agent thereof; provided, that
, such Lender’s failure to give such notice shall not affect the validity
thereof.


 


(b)           If
any Lender (including Agent) shall obtain from any Borrower or Guarantor
payment of any principal of or interest on any Loan owing to it or payment of
any other amount under this Agreement or any of the other Financing Agreements
through the exercise of any right of setoff, banker’s lien or counterclaim or
similar right or otherwise (other than from Agent as provided herein), and, as
a result of such payment, such Lender shall have received more than its Pro
Rata Share of the principal of the Loans or more than its share of such other
amounts then due hereunder or thereunder by any Borrower or Guarantor to such
Lender than the percentage thereof received by any other Lender, it shall
promptly pay to Agent, for the benefit of Lenders, the amount of such excess
and simultaneously purchase from such other Lenders a participation in the
Loans or such other amounts, respectively, owing to such other Lenders (or such
interest due thereon, as the case may be) in such amounts, and make such other
adjustments from time to time as shall be equitable, to the end that all
Lenders shall share the benefit of such excess payment (net of any expenses
that may be incurred by such Lender in obtaining or preserving such excess payment)
in accordance with their respective Pro Rata Shares or as otherwise agreed by
Lenders. To such end all Lenders shall make appropriate adjustments among
themselves (by the resale of participation sold or otherwise) if such payment
is rescinded or must otherwise be restored.


 


(c)           Each
Borrower and Guarantor agrees that any Lender purchasing a participation (or
direct interest) as provided in this Section may exercise, in a manner
consistent with this Section, all rights of setoff, banker’s lien, counterclaim
or similar rights with respect to such participation as fully as if such Lender
were a direct holder of Loans or other amounts (as the case may be) owing to
such Lender in the amount of such participation.


 


(d)           Nothing
contained herein shall require any Lender to exercise any right of setoff,
banker’s lien, counterclaims or similar rights or shall affect the right of any
Lender to exercise, and retain the benefits of exercising, any such right with
respect to any other Indebtedness or obligation of any Borrower or Guarantor. If,
under any applicable bankruptcy, insolvency or other similar law, any Lender
receives a secured claim in lieu of a setoff to which this Section applies,
such Lender shall, to the extent practicable, assign such rights to Agent for
the benefit of Lenders and, in any event, exercise its rights in respect of
such secured claim in a manner consistent with the rights of Lenders entitled
under this Section to share in the benefits of any recovery on such secured
claim.


 


6.10        Settlement Procedures.


 


(a)           In
order to administer the Credit Facility in an efficient manner and to minimize
the transfer of funds between Agent and Lenders, Agent shall (so long as the
aggregate 


 


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amount of Revolving
Loans since the last day of the immediately preceding Settlement Period plus
the amount of the requested Revolving Loans does not exceed $25,000,000) and
otherwise Agent may, at its option, in any case subject to the terms of this
Section, make available, on behalf of Lenders and in accordance with the terms
of this Agreement, the full amount of the Loans requested or charged to any
Borrower’s loan account(s) or otherwise to be advanced by Lenders pursuant to
the terms hereof, without requirement of prior notice to Lenders of the
proposed Loans.


 


(b)           With
respect to all Loans made by Agent on behalf of Lenders as provided in this
Section, the amount of each Lender’s Pro Rata Share of the outstanding Loans
shall be computed weekly, and shall be adjusted upward or downward on the basis
of the amount of the outstanding Loans as of 5:00 p.m. Chicago, Illinois time
on the Business Day immediately preceding the date of each settlement
computation; provided, that, Agent retains the absolute right at
any time or from time to time to make the above described adjustments at
intervals more frequent than weekly, but in no event more than twice in any
week. Agent shall deliver to each of the Lenders after the end of each week, or
at such lesser period or periods as Agent shall determine, a summary statement
of the amount of outstanding Loans for such period (such week or lesser period
or periods being hereinafter referred to as a “Settlement Period”). If the
summary statement is sent by Agent and received by a Lender prior to 12:00 noon
Chicago, Illinois time, then such Lender shall make the settlement transfer
described in this Section by no later than 3:00 p.m. Chicago, Illinois time on
the same Business Day and if received by a Lender after 12:00 noon Chicago, Illinois
time, then such Lender shall make the settlement transfer by not later than
3:00 p.m. Chicago, Illinois Chicago time on the next Business Day following the
date of receipt. If, as of the end of any Settlement Period, the amount of a
Lender’s Pro Rata Share of the outstanding Loans is more than such Lender’s Pro
Rata Share of the outstanding Loans as of the end of the previous Settlement
Period, then such Lender shall forthwith (but in no event later than the time
set forth in the preceding sentence) transfer to Agent by wire transfer in
immediately available funds the amount of the increase. Alternatively, if the
amount of a Lender’s Pro Rata Share of the outstanding Loans in any Settlement
Period is less than the amount of such Lender’s Pro Rata Share of the
outstanding Loans for the previous Settlement Period, Agent shall forthwith
transfer to such Lender by wire transfer in immediately available funds the
amount of the decrease. The obligation of each of the Lenders to transfer such
funds and effect such settlement shall be irrevocable and unconditional and
without recourse to or warranty by Agent. Agent and each Lender agrees to mark
its books and records at the end of each Settlement Period to show at all times
the dollar amount of its Pro Rata Share of the outstanding Loans and Letter of
Credit Accommodations. Each Lender shall only be entitled to receive interest
on its Pro Rata Share of the Loans to the extent such Loans have been funded by
such Lender. Because the Agent on behalf of Lenders may be advancing and/or may
be repaid Loans prior to the time when Lenders will actually advance and/or be
repaid such Loans, interest with respect to Loans shall be allocated by Agent
in accordance with the amount of Loans actually advanced by and repaid to each
Lender and the Agent and shall accrue from and including the date such Loans
are so advanced to but excluding the date such Loans are either repaid by
Borrowers or actually settled with the applicable Lender as described in this
Section.


 


(c)           To
the extent that Agent has made any such amounts available and the settlement
described above shall not yet have occurred, upon repayment of any Loans by a
Borrower, Agent may apply such amounts repaid directly to any amounts made
available by Agent pursuant to this Section. In lieu of weekly or more frequent
settlements, Agent may, at its 


 


61

















 


option, at any
time require each Lender to provide Agent with immediately available funds
representing its Pro Rata Share of each Loan, prior to Agent’s disbursement of
such Loan to Borrower. In such event, upon receipt by Agent of any request to
borrow Loans by a Borrower, Agent shall promptly notify each Lender thereof. In
such event, (a) if a Lender receives notice of a Borrower’s request to borrow a
Prime Rate Loan by 1:00 p.m. Chicago, Illinois time on any Business Day, such
Lender shall make the amount of its Pro Rata Share of such Prime Rate Loan
available to Agent by 3:00 p.m. Chicago, Illinois time on such Business Day; provided,
that, if a Lender receives notice of a Borrower’s request to borrow
Prime Rate Loans after 1:00 p.m. Chicago, Illinois time on any Business Day,
such Lender shall make the amount of its Pro Rata Share of such Prime Rate Loan
available to Agent by 1:00 p.m. Chicago, Illinois time on the next succeeding
Business Day, and (b) if a Lender receives notice of a Borrower’s request to
borrow a Eurodollar Rate Loan by 5:00 p.m. Chicago, Illinois time on any
Business Day, such Lender shall make the amount of its Pro Rata Share of such
Eurodollar Rate Loan available to Agent by 1:000 p.m. Chicago, Illinois time on
the third Business Day following the receipt by such Lender of such notice; provided,
that, if a Lender receives notice of a Borrower’s request to borrow a
Eurodollar Rate Loan after 5:00 p.m. Chicago, Illinois time on any Business
Day, such Lender shall make the amount of its Pro Rata Share of such Eurodollar
Rate Loan available to Agent by 1:00 p.m. Chicago, Illinois time on the fourth
Business Day following the receipt by such Lender of such notice. No Lender
shall be responsible for any default by any other Lender in the other Lender’s
obligation to make a Loan requested hereunder nor shall the Commitment of any
Lender be increased or decreased as a result of the default by any other Lender
in the other Lender’s obligation to make a Loan hereunder.


 


(d)           If
Agent is not funding a particular Loan to a Borrower (or Administrative
Borrower for the benefit of such Borrower) pursuant to Sections 6.10(a) and
6.10(b) above on any day, but is requiring each Lender to provide Agent with
immediately available funds on the date of such Loan as provided in Section
6.10(c) above, Agent may assume that each Lender will make available to Agent
such Lender’s Pro Rata Share of the Loan requested or otherwise made on such
day and Agent may, in its discretion, but shall not be obligated to, cause a
corresponding amount to be made available to or for the benefit of such
Borrower on such day. If Agent makes such corresponding amount available to a
Borrower and such corresponding amount is not in fact made available to Agent
by such Lender, Agent shall be entitled to recover such corresponding amount on
demand from such Lender together with interest thereon for each day from the
date such payment was due until the date such amount is paid to Agent at the
Federal Funds Rate for each day during such period (as published by the Federal
Reserve Bank of New York or at Agent’s option based on the arithmetic mean
determined by Agent of the rates for the last transaction in overnight Federal
funds arranged prior to 9:00 a.m. (Chicago, Illinois time) on that day by each
of the three leading brokers of Federal funds transactions in Chicago, Illinois
selected by Agent) and if such amounts are not paid within three (3) days of
Agent’s demand, at the highest Interest Rate provided for in Section 3.1 hereof
applicable to Prime Rate Loans. During the period in which such Lender has not
paid such corresponding amount to Agent, notwithstanding anything to the
contrary contained in this Agreement or any of the other Financing Agreements,
the amount so advanced by Agent to or for the benefit of any Borrower shall,
for all purposes hereof, be a Loan made by Agent for its own account. Upon any
such failure by a Lender to pay Agent, Agent shall promptly thereafter notify
Administrative Borrower of such failure and Borrowers shall pay such
corresponding amount to Agent for its own account within five (5) Business Days
of Administrative Borrower’s receipt of such notice. A Lender who fails to pay
Agent its Pro Rata Share of any Loans made available by the Agent 


 


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on such Lender’s
behalf, or any Lender who fails to pay any other amount owing by it to Agent,
is a “Defaulting Lender”. Agent shall not be obligated to transfer to a
Defaulting Lender any payments received by Agent for the Defaulting Lender’s
benefit, nor shall a Defaulting Lender be entitled to the sharing of any
payments hereunder (including any principal, interest or fees). Amounts payable
to a Defaulting Lender shall instead be paid to or retained by Agent. Agent may
hold and, in its discretion, relend to a Borrower the amount of all such
payments received or retained by it for the account of such Defaulting Lender. For
purposes of voting or consenting to matters with respect to this Agreement and
the other Financing Agreements and determining Pro Rata Shares, such Defaulting
Lender shall be deemed not to be a “Lender” and such Lender’s Commitment shall
be deemed to be zero (0). This Section shall remain effective with respect to a
Defaulting Lender until such default is cured. The operation of this Section
shall not be construed to increase or otherwise affect the Commitment of any
Lender, or relieve or excuse the performance by any Borrower or Obligor of
their duties and obligations hereunder.


 


(e)           Nothing
in this Section or elsewhere in this Agreement or the other Financing
Agreements shall be deemed to require Agent to advance funds on behalf of any
Lender or to relieve any Lender from its obligation to fulfill its Commitment
hereunder or to prejudice any rights that any Borrower may have against any
Lender as a result of any default by any Lender hereunder in fulfilling its
Commitment.


 


6.11         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 or any of the other Financing Agreements and no action taken by
the Lenders pursuant hereto or thereto shall be deemed to constitute the
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 subject to Section 12.3 hereof, each Lender
shall 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.


 


6.12         Bank
Products. Borrowers and Guarantors, or any of their Subsidiaries, may (but
no such Person is required to) request that the Bank Product Providers provide
or arrange for such Person to obtain Bank Products from Bank Product Providers,
and each Bank Product Provider may, in its sole discretion, provide or arrange
for such Person to obtain the requested Bank Products. This Section 6.12 shall
survive the payment of the Obligations and the termination of this Agreement. Borrowers
and Guarantors and their respective Subsidiaries acknowledge and agree that the
obtaining of Bank Products from Bank Product Providers (a) is in the sole
discretion of such Bank Product Provider, and (b) is subject to all rules and
regulations of such Bank Product Provider. Each Bank Product Provider shall be
deemed a party hereto for purposes of any reference in a Financing Agreement to
the parties for whom Agent is acting, provided, that, the rights of such Bank
Product Provider hereunder and under any of the other Financing Agreements
shall consist exclusively of such Bank Product Provider’s right to share in
payments and collections out of the Collateral as set forth herein. In
connection with any such distribution of payments and collections, Agent shall
be entitled to assume that no amounts are due to any Bank Product Provider
unless such Bank Product Provider has notified Agent in writing of any such
liability owed to it as of the date of any such distribution.


 


6.13        Taxes


 


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(a)           Any and all payments by any Borrower
or Guarantor hereunder or under the other Financing Agreements shall be made
free and clear of and without deduction for any and all present or future
taxes, levies, imposts, deductions, charges or withholdings imposed by any
Governmental Authority, and all liabilities with respect thereto, excluding (x)
taxes imposed on (or measured by) the net income or franchise taxes of Agent or
any Lender by the jurisdiction in which such Person is organized or has its
principal office or, in the case of any Lender, by the jurisdiction in which
its applicable lending office is located or (y) any branch profits taxes
imposed by the United States of America or any other Governmental Authority
(all such nonexcluded taxes, levies, imposts, deductions, charges, withholdings
and liabilities, collectively or individually, “Taxes”). If any Borrower or
Guarantor shall be required to deduct any Taxes from or in respect of any sum
payable hereunder or under any other Financing Agreement to Agent or any
Lender, (i) the sum payable shall be increased by the amount (an “additional
amount”) necessary so that after making all required deductions (including
deductions applicable to additional sums payable under this Section 6.13) Agent
or such Lender shall receive an amount equal to the sum it would have received
had no such deductions been made, (ii) such Borrower or Guarantor shall make
such deductions and (iii) such Borrower or Guarantor shall pay the full amount
deducted to the relevant Governmental Authority in accordance with applicable
law.


 


(b)           In addition, each Borrower and
Guarantor agrees to pay to the relevant Governmental Authority in accordance
with applicable law any present or future stamp or documentary taxes or any
other excise or property taxes, charges or similar levies that arise from any
payment made hereunder or from the execution, delivery or registration of, or
otherwise with respect to, this Agreement or any other Financing Agreement (“Other
Taxes”). Each Borrower and Guarantor shall deliver to Agent and each Lender
official receipts in respect of any Taxes or Other Taxes payable hereunder
promptly after payment of such Taxes or Other Taxes.


 


(c)           Each Borrower and Guarantor hereby
indemnifies and agrees to hold Agent and each Lender harmless from and against
Taxes and Other Taxes (including, without limitation, Taxes and Other Taxes
imposed on any amounts payable under this Section 6.13) paid by such Person,
whether or not such Taxes or Other Taxes were correctly or legally asserted. Such
indemnification shall be paid within 10 days from the date on which any such
Person makes written demand therefor specifying in reasonable detail the nature
and amount of such Taxes or Other Taxes, which demand shall be conclusive and
binding absent manifest error.


 


(d)           (i) Each Lender that is organized
under the laws of a jurisdiction outside the United States of America (a “Non
US Lender”) agrees that it shall, no later than the date of this Agreement (or,
in the case of a Lender which becomes a party hereto pursuant to Section 13.7
hereof after the date of this Agreement, promptly after the date upon which
such Lender becomes a party hereto) deliver to the Agent two properly completed
and duly executed copies of either United States Internal Revenue Service Form
W-8BEN, W-8ECI or W-8IMY or any subsequent versions thereof or successors
thereto, in each case, claiming complete exemption from, or reduced rate of,
United States Federal withholding tax and payments of interest hereunder. In
addition, in the case of a Non US Lender claiming exemption from U.S. Federal
withholding tax under Section 871(h) or 881(c) of the Internal Revenue Code,
such Non US Lender hereby represents to the Agent and the Borrower that such
Non US Lender is not a bank for purposes of Section 881(c) of the Internal
Revenue Code, is not a 10 percent shareholder (within the meaning of Section
871(h)(3)(B) of the Internal Revenue Code) of any Borrower and 


 


64

















 


is not a controlled
foreign corporation related to any Borrower (within the meaning of Section
864(d)(4) of the Internal Revenue Code), and such Non US Lender agrees that it
shall promptly notify the Agent in the event any such representation is no
longer accurate. Such forms shall be delivered by each Non US Lender on or
before the date it becomes a party to this Agreement and on or before the date,
if any, such Non US Lender changes its applicable lending office by designating
a different lending office (a “New Lending Office”). In addition, each Non US
Lender shall deliver such forms within 20 days after receipt of a written
request therefor from Agent or the assigning Lender, as applicable. Notwithstanding
any other provision of this Section 6.13, a Non US Lender shall not be required
to deliver any form pursuant to this Section 6.13 that such Non US Lender is
not legally able to deliver. Upon the Administrative Borrower’s written
request, Agent shall deliver to the Administrative Borrower all such forms
received by Agent to the date of such written request.


 


(ii)           Each Lender that is organized under
the laws of a jurisdiction inside the United States of America shall deliver to
Agent  two properly completed and duly
executed copies of U.S. Internal Revenue Service Form W-9 (or any successor
form thereto) certifying that such Lender is exempt from U.S. backup
withholding tax. Such forms shall be delivered by each such Lender on or before
the date it becomes a party to this Agreement and thereafter within 20 days
after receipt of a written request therefor from any Agent. Upon Administrative
Borrower’s written request, Agent shall deliver to Administrative Borrower all
such forms received by Agent to the date of such written request. Notwithstanding
any other provision of this Section 6.13, a Lender described in this Section
6.13 shall not be required to deliver any form pursuant to this Section 6.13
that such Lender is not legally able to deliver.


 


(e)           Notwithstanding anything contained
herein to the contrary, Borrowers and Guarantors shall not be required to
indemnify any Non US Lender, or pay any additional amounts to any Non US
Lender, in respect of U.S. Federal withholding tax pursuant to this Agreement
or any other Financing Agreement to the extent that (i) the obligation to
withhold amounts with respect to U.S. Federal withholding tax existed on the
date such Non US Lender became a party to this Agreement or, with respect to
payments to a New Lending Office, the date such Non US Lender designated such
New Lending Office with respect to a Revolving Loan; provided, however that
this clause (i) shall not apply to the extent the indemnity payment or
additional amounts any assignee or transferee of any Lender, or any Lender
through a New Lending Office, would be entitled to receive (without regard to
this clause (i)) do not exceed the indemnity payment or additional amounts that
the person making the assignment or transfer to such assignee or transferee, or
such Lender making the designation of such New Lending Office, would have been
entitled to receive in the absence of such assignment, transfer or designation,
or (ii) the obligation to pay such additional amounts would not have arisen but
for a failure by such Non US Lender to comply with the provisions of clause (d)
above (irrespective of such Non US Lender’s legal ability to so comply). In
addition, the Borrowers and Guarantors shall not be required to indemnify or
pay any additional amounts in respect of U.S. backup withholding tax to any
Lender pursuant to this Agreement or any other Financing Agreement to the
extent the obligation to pay such additional amounts would not have arisen but
for a failure by such Lender to comply with the provisions of this Section 6.13
(irrespective of such Lender’s legal ability to so comply).


 


(f)            Agent or any Lender claiming any
indemnity payment or additional payment amounts payable pursuant to this
Section 6.13 shall use reasonable efforts (consistent 


 


65

















 


with legal and regulatory
restrictions) to file any certificate or document reasonably requested in
writing by Administrative Borrower or to change the jurisdiction of its
applicable lending office if the making of such a filing or change would avoid
the need for or reduce the amount of any such indemnity payment or additional
amount which may thereafter accrue, would not require Agent or such Lender to
disclose any information Agent or such Lender deems confidential and would not,
in the sole determination of Agent or such Lender, be otherwise disadvantageous
to Agent or such Lender.


 


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


 


(h)           The obligations of Borrowers and
Guarantors under this Section 6.13 shall survive the termination of this
Agreement and the payment of the Obligations.


 


SECTION 7.           COLLATERAL
REPORTING AND COVENANTS


 


7.1           Collateral
Reporting. (a)  Borrowers shall
provide Agent with the following documents in a form satisfactory to Agent:


 


(i)            as
soon as possible after the end of each month (but in any event within fifteen
(15) Business Days after the end thereof or, solely in the case of each month
in 2007, within twenty (20) Business Days after the end thereof), on a monthly
basis or more frequently as Agent may request if an Event of Default has
occurred and is continuing or a Compliance Period exists, (A) general ledger
inventory reports with respect to such inventory or, to the extent available,
perpetual inventory reports with respect to such inventory, (B) inventory
reports by location and category (with the amounts and value of Perishable
Inventory specified and including the amounts of Inventory and the value
thereof at premises of warehouses, processors or other third parties excluding
leased locations), (C) agings of accounts receivable, (D) accounts payable
reports (and including information indicating the amounts owing to owners and
lessors of leased premises, warehouses, and other third parties from time to
time in possession of any Collateral), (E) a Borrowing Base Certificate setting
forth Administrative Borrower’s calculation of the Revolving Loans and Letter
of Credit Accommodations available to Borrowers pursuant to the terms and conditions
contained herein as of the last day of the 


 


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immediately
preceding period, duly completed and executed by an authorized officer of
Administrative Borrower, together with all schedules required pursuant to the
terms of the Borrowing Base Certificate duly completed;


 


(ii)           as
soon as possible after the end of each month (but in any event fifteen (15)
Business Days after the end thereof or, solely in the case of each month in
2007, within twenty (20) Business Days after the end thereof), on monthly a
basis or more frequently as Agent may request if an Event of Default has
occurred and is continuing or a Compliance Period exists, in each case
certified by an authorized officer of Administrative Borrower as true and
correct: (A) a statement confirming the payment of rent and other amounts due
to owners and lessors of real property used by any Borrower or Guarantor in the
immediately preceding month, (B) the addresses of all new retail store
locations and other new locations (including new warehouse locations) of
Borrowers and Guarantors opened and existing retail store locations closed or
sold, in each case since the date of the most recent certificate delivered to
Agent containing the information required under this clause, and (C) a report
of any new deposit account established or used by any Borrower or Guarantor
with any bank or other financial institution, including the Borrower or
Guarantor in whose name the account is maintained, the account number, the name
and address of the financial institution at which such account is maintained,
the purpose of such account and, if any, the amount held in such account on or
about the date of such report; and


 


(iii)          such
other reports, documents and information as to the Collateral as Agent shall
reasonably request from time to time.


 


(b)           If
any Borrower’s or Guarantor’s records or reports of the Collateral are prepared
or maintained by an accounting service, contractor, shipper or other agent,
such Borrower and Guarantor hereby irrevocably authorizes such service,
contractor, shipper or agent to deliver such records, reports, and related
documents to Agent and to follow Agent’s instructions with respect to further
services at any time that an Event of Default has occurred and is continuing.


 


(c)           Nothing
contained in any Borrowing Base Certificate shall be deemed to limit, impair or
otherwise affect the rights of Agent contained herein and in the event of any
conflict or inconsistency between the calculation of the Revolving Loans and
Letter of Credit Accommodations available to Borrowers as set forth in any
Borrowing Base Certificate and as determined by Agent in accordance with the
terms of this Agreement, the good faith determination of Agent shall govern and
be conclusive and binding upon Borrowers. Without limiting the foregoing,
Borrowers shall furnish to Agent any information which Agent may reasonably
request regarding the determination and calculation of any of the amounts set
forth in the Borrowing Base Certificate.


 


7.2          Accounts Covenants.


 


(a)           Borrowers
shall notify Agent promptly of: (i) any material delay in any Borrower’s
performance of any of its material obligations to any account debtor, Credit
Card Issuer or Credit Card Processor which owes Borrowers more than $750,000 or
the assertion of any material claims, offsets, defenses or counterclaims by any
account debtor, Credit Card Issuer or Credit Card Processor which owes
Borrowers more than $750,000, or any material disputes with any account debtor,
Credit Card Issuers or Credit Card Processor which owes Borrowers 


 


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more than
$750,000, or any settlement, adjustment or compromise thereof, (ii) all
material adverse information known to any Borrower or Guarantor relating to the
financial condition of any account debtor, Credit Card Issuers or Credit Card
Processor  which owes Borrowers more than
$750,000 and (iii) any event or circumstance which, to the best of any Borrower’s
or Guarantor’s knowledge, would cause Agent to consider any then existing
Accounts as no longer constituting Eligible Accounts or Eligible Credit Card
Receivables. No credit, discount, allowance or extension or agreement for any
of the foregoing shall be granted to any account debtor, Credit Card Issuers or
Credit Card Processor without Agent’s consent, except in the ordinary course of
a Borrower’s or Guarantor’s business in accordance with such Borrower’s or
Guarantor’s existing practices and policies and except as set forth in the
schedules delivered to Agent pursuant to Section 7.1(a) above. So long as no
Event of Default has occurred and is continuing, Borrowers and Guarantors shall
settle, adjust or compromise any claim, offset, counterclaim or dispute with
any account debtor, Credit Card Issuers or Credit Card Processor. At any time
that an Event of Default has occurred and is continuing, Agent shall, at its
option, have the exclusive right to settle, adjust or compromise any claim,
offset, counterclaim or dispute with account debtors or grant any credits,
discounts or allowances.


 


(b)           With
respect to each Account: (i) the amounts shown on any invoice delivered to
Agent or schedule thereof delivered to Agent shall be true and complete in all
material respects, (ii) no payments shall be made thereon except payments
promptly remitted in accordance with the terms of this Agreement, (iii) no
credit, discount, allowance or extension or agreement for any of the foregoing
shall be granted to any account debtor, Credit Card Issuer or Credit Card
Processor except as reported to Agent in accordance with this Agreement and
except for credits, discounts, allowances or extensions made or given in the
ordinary course of each Borrower’s business in accordance with such Borrower’s
existing practices and policies, (iv) which consists of Eligible Accounts there
shall be no setoffs, deductions, contras, defenses, counterclaims or disputes
existing or asserted with respect thereto except as reported to Agent in
accordance with the terms of this Agreement, (v) none of the transactions
giving rise thereto will violate any applicable foreign, Federal, State or
local laws or regulations, all documentation relating thereto will be legally
sufficient under such laws and regulations and all such documentation will be
legally enforceable in accordance with its terms.


 


(c)           Borrowers
shall notify Agent promptly of:  (i) any
notice of a material default by any Borrower or Guarantor under any of the
Credit Card Agreements or of any default which has a reasonable likelihood of
resulting in the Credit Card Issuer or Credit Card Processor ceasing to make
payments or suspending payments to any Borrower or Guarantor, (ii) any notice
from any Credit Card Issuer or Credit Card Processor that such person is
ceasing or suspending, or will cease or suspend, any present or future payments
due or to become due to any Borrower or Guarantor from such person, or that
such person is terminating or will terminate any of the Credit Card Agreements,
and (iii) the failure of any Borrower or Guarantor to comply with any material
terms of the Credit Card Agreements or any terms thereof which has a reasonable
likelihood of resulting in the Credit Card Issuer or Credit Card Processor
ceasing or suspending payments to any Borrower or Guarantor.


 


(d)           Agent
shall have the right, in Agent’s name (at any time during which an Event of
Default shall have occurred and be continuing) or in the name of a nominee of
Agent (at all other times), to verify the validity, amount or any other matter
relating to any Receivables or other Collateral, by mail, telephone, facsimile
transmission or otherwise.


 


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7.3           Inventory
Covenants. With respect to the Inventory: (a) each Borrower and Guarantor
shall at all times maintain inventory records reasonably satisfactory to Agent
in substantially the same manner as being maintained on the date hereof
(subject, however, to the terms of clause (o) of the definition of Eligible
Inventory), keeping correct and accurate records itemizing and describing the
kind, type, quality and quantity of Inventory and such Borrower’s or Guarantor’s
cost therefor; (b) Borrowers and Guarantors shall conduct a physical count of
the Inventory no less frequently than is consistent with the past practices of
Borrowers and Guarantors, but at any time or times as Agent may request upon
the occurrence and during the continuance of an Event of Default, and following
such physical inventory shall, promptly upon Agent’s request, supply Agent with
a report in the form and with such specificity as may be satisfactory to Agent
concerning such physical count; (c) Borrowers and Guarantors shall not remove
any Inventory from the locations set forth or permitted herein, without the
prior written consent of Agent, except for sales of Inventory in the ordinary
course of its business and except to move Inventory directly from one location
set forth or permitted herein to another such location and except for Inventory
shipped from the manufacturer or distributor thereof to such Borrower or
Guarantor which is in transit to the locations set forth or permitted herein;
(d) upon Agent’s request, Borrowers shall, at their expense, no more than one
(1) time in any twelve (12) month period, but at any time or times as Agent may
request at the expense of Agent or at the expense of Borrowers upon the
occurrence and during the continuance of an Event of Default, deliver or cause
to be delivered to Agent written appraisals as to the Inventory in form, scope
and methodology reasonably acceptable to Agent and by an appraiser reasonably
acceptable to Agent, addressed to Agent and Lenders and upon which Agent and
Lenders are expressly permitted to rely; (e) Borrowers and Guarantors shall
produce, use, store and maintain the Inventory with all reasonable care and
caution and in accordance with applicable standards of any insurance and in
conformity with applicable laws (including the requirements of the Federal Fair
Labor Standards Act of 1938, as amended and all rules, regulations and orders related
thereto); (f) none of the Inventory or other Collateral constitutes farm
products or the proceeds thereof; (g) each Borrower and Guarantor assumes all
responsibility and liability arising from or relating to the production, use,
sale or other disposition of the Inventory, (h) Borrowers and Guarantors shall
not sell Inventory to any customer on approval, or any other basis which
entitles the customer to return or may obligate any Borrower or Guarantor to
repurchase such Inventory, except for the right of return given to customers of
such Borrower or Guarantor in the ordinary course of the business of such
Borrower or Guarantor in accordance with the then current return policy of such
Borrower or Guarantor; (i) Borrowers and Guarantors shall keep the Inventory in
good and marketable condition; and (j) Borrowers and Guarantors shall not,
without prior written notice to Agent or the specific identification of such
Inventory in a report with respect thereto provided by Administrative Borrower
to Agent pursuant to Section 7.1(a) hereof, acquire or accept any Inventory on
consignment or approval.


 


7.4           Equipment
and Real Property Covenants . With respect to the Equipment and Real
Property: (a) upon Agent’s request at any time that an Event of Default has
occurred and is continuing, Borrowers and Guarantors shall, at their expense,
deliver or cause to be delivered to Agent written appraisals as to the
Equipment and/or the Real Property in form, scope and methodology reasonably
acceptable to Agent and by an appraiser reasonably acceptable to Agent,
addressed to Agent and upon which Agent is expressly permitted to rely; provided,
that, in no event shall Borrowers and Guarantors be liable for the
expense of (i) any appraisal of Equipment pursuant to this Section 7.4 prior to
the date on which the Equipment Availability Conditions have been satisfied or
(ii) any appraisal of Real Property pursuant to this Section 7.4 


 


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prior to the date on which the Real Property Availability Conditions
have been satisfied; (b) Borrowers and Guarantors shall keep the Equipment in
good order and repair (ordinary wear and tear excepted); (c) Borrowers and
Guarantors shall use the Equipment and Real Property with all reasonable care
and caution and in accordance with applicable standards of any insurance and in
conformity with all applicable laws; (d) the Equipment is and shall be used in
the business of Borrowers and Guarantors and not for personal, family,
household or farming use; (e) Borrowers and Guarantors shall not remove any
Equipment from the locations set forth or permitted herein, except to the
extent necessary to have any Equipment repaired or maintained in the ordinary
course of its business or to move Equipment directly from one location set
forth or permitted herein to another such location and except for the movement
of motor vehicles used by or for the benefit of such Borrower or Guarantor in
the ordinary course of business; and (f) each Borrower and Guarantor assumes
all responsibility and liability arising from the use of the Equipment and Real
Property.


 


7.5           Power
of Attorney. Each Borrower and Guarantor hereby irrevocably designates and
appoints Agent (and all persons designated by Agent) as such Borrower’s and
Guarantor’s true and lawful attorney-in-fact, and authorizes Agent, in such
Borrower’s, Guarantor’s or Agent’s name, to: (a) at any time an Event of
Default has occurred and is continuing (i) demand payment on Receivables or
other Collateral, (ii) enforce payment of Receivables by legal proceedings or
otherwise, (iii) exercise all of such Borrower’s or Guarantor’s rights and
remedies to collect any Receivable or other Collateral, (iv) sell or assign any
Receivable upon such terms, for such amount and at such time or times as the
Agent deems advisable, (v) settle, adjust, compromise, extend or renew an
Account, (vi) discharge and release any Receivable, (vii) prepare, file and
sign such Borrower’s or Guarantor’s name on any proof of claim in bankruptcy or
other similar document against an account debtor or other obligor in respect of
any Receivables or other Collateral, (viii) notify the post office authorities
to change the address for delivery of remittances from account debtors or other
obligors in respect of Receivables or other proceeds of Collateral to an
address designated by Agent, and open and dispose of all mail addressed to such
Borrower or Guarantor and handle and store all mail relating to the Collateral;
and (ix) do all acts and things which are necessary, in Agent’s determination,
to fulfill such Borrower’s or Guarantor’s obligations under this Agreement and
the other Financing Agreements and (b) at any time to (i) take control in any
manner of any item of payment in respect of Receivables or constituting Collateral
if a Cash Dominion Period exists or any items or payment constituting
Collateral is otherwise received in or for deposit in the Blocked Accounts or
otherwise received by Agent or any Lender, (ii) if a Cash Dominion Period
exists, have access to any lockbox or postal box into which remittances from
account debtors or other obligors in respect of Receivables or other proceeds
of Collateral are sent or received, (iii) if a Cash Dominion Period exists,
endorse such Borrower’s or Guarantor’s name upon any items of payment in
respect of Receivables or constituting Collateral or otherwise received by
Agent and any Lender and deposit the same in Agent’s account for application to
the Obligations, (iv) endorse such Borrower’s or Guarantor’s name upon any chattel
paper, document, instrument, invoice, or similar document or agreement relating
to any Receivable or any goods pertaining thereto or any other Collateral,
including any warehouse or other receipts, or bills of lading and other
negotiable or non-negotiable documents, (v) clear Inventory the purchase of
which was financed with Letter of Credit Accommodations through U.S. Customs or
foreign export control authorities in such Borrower’s or Guarantor’s name,
Agent’s name or the name of Agent’s designee, and to sign and deliver to
customs officials powers of attorney in such Borrower’s or Guarantor’s name for
such purpose, and to complete in such Borrower’s or Guarantor’s or Agent’s 


 


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name, any order, sale or transaction, obtain the
necessary documents in connection therewith and collect the proceeds thereof,
and (vi) sign such Borrower’s or Guarantor’s name on any verification of
Receivables and notices thereof to account debtors or any secondary obligors or
other obligors in respect thereof. Each Borrower and Guarantor hereby releases
Agent and Lenders and their respective officers, employees and designees from
any liabilities arising from any act or acts under this power of attorney and
in furtherance thereof, whether of omission or commission, except as a result
of Agent’s or any Lender’ s own gross negligence or willful misconduct as
determined pursuant to a final non-appealable order of a court of competent
jurisdiction.


 


7.6           Right
to Cure. Agent may, at its option, upon not less than ten (10) days prior
notice to Administrative Borrower (except that no such prior notice shall be
required in the case of exigent circumstances as determined by Agent in good
faith), (a) cure any material default by any Borrower or Guarantor under any
material agreement with a third party that affects the Collateral, its value or
the ability of Agent to collect, sell or otherwise dispose of the Collateral or
the rights and remedies of Agent or any Lender therein or the ability of any
Borrower or Guarantor to perform its obligations hereunder or under any of the
other Financing Agreements, (b) pay or bond on appeal any material judgment
entered against any Borrower or Guarantor, (c) discharge taxes, liens, security
interests or other encumbrances (other than liens, security interests and
encumbrances permitted under Section 9.8 hereof) at any time levied on or
existing with respect to the Collateral and pay any amount, incur any expense
or perform any act which, in Agent’s good faith judgment, is necessary or
appropriate to preserve, protect, insure or maintain the Collateral and the
rights of Agent and Lenders with respect thereto. Agent may add any amounts so
expended to the Obligations and charge any Borrower’s account therefor, such
amounts to be repayable by Borrowers on demand. Agent and Lenders shall be
under no obligation to effect such cure, payment or bonding and shall not, by
doing so, be deemed to have assumed any obligation or liability of any Borrower
or Guarantor. Any payment made or other action taken by Agent or any Lender
under this Section shall be without prejudice to any right to assert an Event
of Default hereunder and to proceed accordingly.


 


7.7           Access
to Premises. From time to time as requested by Agent, at the cost and
expense of Borrowers, (a) Agent or its designee shall have complete access to
all of each Borrower’s and Guarantor’s premises during normal business hours
and after notice to Parent, or at any time and without notice to Administrative
Borrower if an Event of Default has occurred and is continuing, for the
purposes of inspecting, verifying and auditing the Collateral and all of each
Borrower’s and Guarantor ‘s books and records, including the Records, provided,
that, (i) unless a Compliance Period exists, Agent shall not conduct
such an inspection, verification or audit more than one (1) time during any
calendar year and (ii) unless an Event of Default has occurred and is
continuing or the expense of such inspection, verification or audit is borne by
Agent, Agent shall not conduct such an inspection, verification or audit more
than two (2) times during any calendar year, and (b) each Borrower and
Guarantor shall promptly furnish to Agent such copies of such books and records
or extracts therefrom as Agent may request, and Agent or any Lender or Agent’s
designee may use during normal business hours such of any Borrower’s and
Guarantor’s personnel, equipment, supplies and premises as may be reasonably
necessary for the foregoing and if an Event of Default has occurred and is
continuing for the collection of Receivables and realization of other
Collateral.


 


SECTION 8.           REPRESENTATIONS
AND WARRANTIES


 


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Each Borrower and Guarantor hereby represents and warrants
to Agent and Lenders the following (which shall survive the execution and
delivery of this Agreement), the truth and accuracy of which are a continuing
condition of the making of Loans and providing Letter of Credit Accommodations
to Borrowers:


 


8.1           Existence,
Power and Authority. Each Borrower and Guarantor is a corporation or
limited liability company duly organized and in good standing under the laws of
its state of incorporation or formation and is duly qualified as a foreign
corporation or limited liability company and in good standing in all states or
other jurisdictions where the nature and extent of the business transacted by
it or the ownership of assets makes such qualification necessary, except for
those jurisdictions in which the failure to so qualify would not have a
material adverse effect on such Borrower’s or Guarantor’ s financial condition,
results of operation or business or the rights of Agent in or to any of the
Collateral. The execution, delivery and performance of this Agreement, the
other Financing Agreements and the transactions contemplated hereunder and
thereunder (a) are all within each Borrower’s and Guarantor’s corporate powers,
(b) have been duly authorized, (c) are not in contravention the terms of any
Borrower’s or Guarantor’s certificate of incorporation or formation, by-laws,
operating agreement or other organizational documentation, (d) are not in
contravention in any material respect of any law or any indenture, agreement or
undertaking to which any Borrower or Guarantor is a party or by which any
Borrower or Guarantor or its property are bound and (e) will not result in the
creation or imposition of, or require or give rise to any obligation to grant,
any lien, security interest, charge or other encumbrance upon any property of
any Borrower or Guarantor, except for the creation of a lien in favor of Agent.
This Agreement and the other Financing Agreements to which any Borrower or
Guarantor is a party constitute legal, valid and binding obligations of such
Borrower and Guarantor enforceable in accordance with their respective terms
,except as such enforceability may be limited by bankruptcy, insolvency,
reorganization, moratorium or similar law limiting creditors’ rights generally
and by general equitable principles.


 


8.2           Name;
State of Organization; Chief Executive Office; Collateral Locations.


 


(a)           As
of the date hereof, the exact legal name of each Borrower and Guarantor is as
set forth on the signature page of this Agreement and in the Information
Certificate. No Borrower or Guarantor has, during the five years prior to the
date of this Agreement, been known by or used any other corporate or fictitious
name or been a party to any merger or consolidation, or acquired all or
substantially all of the assets of any Person, or acquired any of its property
or assets out of the ordinary course of business, except as set forth in the
Information Certificate.


 


(b)           As
of the date hereof, each Borrower and Guarantor is an organization of the type
and organized in the jurisdiction set forth in the Information Certificate. The
Information Certificate accurately sets forth the organizational identification
number of each Borrower and Guarantor or accurately states that such Borrower
or Guarantor has none and accurately sets forth the federal employer
identification number of each Borrower and Guarantor.


 


(c)           The
chief executive office and mailing address of each Borrower and Guarantor and
each Borrower’s and Guarantor’s Records concerning Accounts are located only at
the address identified as such in Schedule 8.2 to the Information Certificate
and its only other places of business and the only other locations of
Collateral, if any, are the addresses set forth in Schedule 8.2 to the
Information Certificate, subject to the rights of any Borrower or Guarantor to 


 


72

















 


establish new
locations in accordance with Section 9.2 below. The Information Certificate
correctly identifies any of such locations which are not owned by a Borrower or
Guarantor and sets forth the owners and/or operators thereof.


 


8.3           Financial
Statements; No Material Adverse Change. All financial statements relating
to any Borrower or Guarantor which have been or may hereafter be delivered by
any Borrower or Guarantor to Agent and Lenders have been prepared in accordance
with GAAP (except as to any interim financial statements, to the extent such
statements are subject to normal year-end adjustments and do not include
complete footnotes) and fairly present in all material respects the financial
condition and the results of operation of such Borrower and Guarantor as at the
dates and for the periods set forth therein. Except as disclosed in any interim
financial statements furnished by Borrowers and Guarantors to Agent prior to the
date of this Agreement, there has been no act, condition or event which has had
or is reasonably likely to have a Material Adverse Effect since the date of the
most recent audited financial statements of any Borrower or Guarantor furnished
by any Borrower or Guarantor to Agent prior to the date of this Agreement. The
Petro Companies have, prior to the date hereof and in accordance with the terms
of the Petro Indenture, deposited with the Petro Indenture Trustee a sufficient
amount of cash or cash equivalents to redeem in full the aggregate outstanding
principal amount of all Indebtedness owing under and in connection with the
Petro Indenture, together with all interest, fees, premiums and penalties owing
in respect thereof, through February 15, 2008 (the “Petro Indenture Cash
Collateral”). All such Indebtedness (including all such interest, fees,
premiums and penalties) will be redeemed in full by no later than February 15,
2008 with the proceeds of the Petro Indenture Cash Collateral previously
deposited with the Petro Indenture Trustee, at which time all liens and
security interest of the Petro Indenture Trustee on the assets of the Petro
Companies and the Capital Stock in Petro will be automatically released and the
Petro Companies will promptly instruct the Petro Indenture Trustee to execute
all such agreements and instruments and take all such further actions as may be
reasonably requested by the Petro Companies or Agent to evidence the release of
such liens and security interests.


 


8.4           Priority
of Liens; Title to Properties. The security interests and liens granted to
Agent under this Agreement and the other Financing Agreements constitute valid
and perfected first priority liens and security interests in and upon the
Collateral subject only to the liens indicated on Schedule 8.4 to the
Information Certificate and the other liens permitted under Section 9.8 hereof;
provided, that, the security interests and liens in the
Collateral of the Petro Companies and the Capital Stock in Petro granted under
this Agreement and the other Financing Agreements shall not constitute valid
and perfected liens and security interests in and upon such Collateral and
Capital Stock until the Petro Lien Effective Date. Each Borrower and Guarantor
has good and marketable fee simple title to or valid leasehold interests in all
of its Real Property and good, valid and merchantable title to all of its other
properties and assets subject to no liens, mortgages, pledges, security
interests, encumbrances or charges of any kind, except those granted to Agent
and such others as are specifically listed on Schedule 8.4 to the Information
Certificate or permitted under Section 9.8 hereof.


 


8.5           Tax
Returns. Each Borrower and Guarantor has filed, or caused to be filed, in a
timely manner all federal and other material tax returns, reports and
declarations which are required to be filed by it. All information in such tax
returns, reports and declarations is complete and accurate in all material
respects. Each Borrower and Guarantor has paid or caused to be paid all
material taxes due and payable or claimed due and payable in any assessment 


 


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received by it, except taxes the validity of which are being contested
in good faith by appropriate proceedings diligently pursued and available to
such Borrower or Guarantor and with respect to which adequate reserves have
been set aside on its books. Adequate provision has been made for the payment
of all accrued and unpaid Federal, State, county, local, foreign and other
taxes whether or not yet due and payable and whether or not disputed.


 


8.6           Litigation.
Except as set forth on Schedule 8.6 to the Information Certificate, (a) there
is no investigation by any Governmental Authority pending, or to the best of
any Borrower’s or Guarantor’s knowledge threatened, against or affecting any
Borrower or Guarantor, its or their assets or business and (b) there is no
action, suit, proceeding or claim by any Person pending, or to the best of any
Borrower’s or Guarantor’s knowledge threatened, against any Borrower or
Guarantor or its or their assets or goodwill, or against or affecting any
transactions contemplated by this Agreement, in each case, which has had or
could reasonably be expected to have a Material Adverse Effect.


 


8.7          Compliance with Other Agreements
and Applicable Laws.  


 


(a)           Borrowers
and Guarantors are not in default in any respect under, or in violation in any
respect of the terms of, any agreement, contract, instrument, lease or other
commitment to which it is a party or by which it or any of its assets are
bound, except for such defaults or violations which could not be reasonably
expected to have a Material Adverse Effect. Borrowers and Guarantors are in
compliance with the requirements of all applicable laws, rules, regulations and
orders of any Governmental Authority relating to their respective businesses,
including, without limitation, those set forth in or promulgated pursuant to
the Occupational Safety and Health Act of 1970, as amended, the Fair Labor
Standards Act of 1938, as amended, ERISA, the Code, as amended, and the rules
and regulations thereunder, Environmental Laws, all Federal, State and local
statutes, regulations, rules and orders relating to consumer credit (including,
without limitation, as each has been amended, the Truth-in-Lending Act, the
Fair Credit Billing Act, the Equal Credit Opportunity Act and the Fair Credit
Reporting Act, and regulations, rules and orders promulgated thereunder), and
all Federal, State and local states, regulations, rules and orders pertaining
to sales of consumer goods (including, without limitation, the Consumer
Products Safety Act of 1972, as amended, and the Federal Trade Commission Act
of 1914, as amended, and all regulations, rules and orders promulgated
thereunder), except in any case for such non-compliance which could not be
reasonably expected to have a Material Adverse Effect.


 


(b)           Borrowers
and Guarantors have obtained all permits, licenses, approvals, consents,
certificates, orders or authorizations of any Governmental Authority required
for the lawful conduct of its business (the “Permits”), except where the
failure to so obtain could not reasonably be expected to have a Material
Adverse Effect. All of the Permits are valid and subsisting and in full force
and effect, except where the failure to be valid, subsisting or in full force
and effect could not reasonably be expected to have a Material Adverse Effect. Except
as could not reasonably be expected to have a Material Adverse Effect, there
are no actions, claims or proceedings pending or to the best of any Borrower’s
or Guarantor’s knowledge, threatened that seek the revocation, cancellation,
suspension or modification of any of the Permits.


 


8.8          Environmental Compliance.


 


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(a)           Borrowers,
Guarantors and any Subsidiary of any Borrower or Guarantor have not generated,
used, stored, treated, transported, manufactured, handled, produced or disposed
of any Hazardous Materials, on or off its premises (whether or not owned by it)
in any manner which at any time violates any applicable Environmental Law or
Permit, except for such violations which could not be reasonably expected to
have a Material Adverse Effect, and the operations of Borrowers, Guarantors and
any Subsidiary of any Borrower or Guarantor comply with all Environmental Laws
and all Permits, except for such non-compliance which could not be reasonably
expected to have a Material Adverse Effect.


 


(b)           There
has been no investigation by any Governmental Authority or any proceeding,
complaint, order, directive, claim, citation or notice by any Governmental
Authority or any other person nor is any pending or to the best of any Borrower’s
or Guarantor’s knowledge threatened, with respect to any non-compliance with or
violation of the requirements of any Environmental Law by any Borrower or
Guarantor and any Subsidiary of any Borrower or Guarantor or the release, spill
or discharge, threatened or actual, of any Hazardous Material or the
generation, use, storage, treatment, transportation, manufacture, handling,
production or disposal of any Hazardous Materials or any other environmental,
health or safety matter, which in any case could be reasonably expected to have
a Material Adverse Effect.


 


(c)           Borrowers,
Guarantors and their Subsidiaries have no liability (contingent or otherwise)
in connection with a release, spill or discharge, threatened or actual, of any
Hazardous Materials or the generation, use, storage, treatment, transportation,
manufacture, handling, production or disposal of any Hazardous Materials, which
in any case could be reasonably expected to have a Material Adverse Effect.


 


(d)           Borrowers,
Guarantors and their Subsidiaries have all Permits required to be obtained or
filed in connection with the operations of Borrowers and Guarantors under any
Environmental Law and all of such licenses, certificates, approvals or similar
authorizations and other Permits are valid and in full force and effect, except
(in any case) where such failure to obtain or file (or be valid in full force
and effect) could not reasonably be expected to have a Material Adverse Effect.


 


8.9          Employee Benefits.


 


(a)           Each
Plan is in compliance in all material respects with the applicable provisions
of ERISA, the Code and other Federal or State law. Each Plan which is intended
to qualify under Section 401(a) of the Code has received a favorable
determination letter from the Internal Revenue Service and to the best of any
Borrower’s or Guarantor’s knowledge, nothing has occurred which would cause the
loss of such qualification. Each Borrower and its ERISA Affiliates have made
all required contributions to any Plan subject to Section 412 of the Code, and
no application for a funding waiver or an extension of any amortization period
pursuant to Section 412 of the Code has been made with respect to any Plan.


 


(b)           There
are no pending, or to the best of any Borrower’s or Guarantor’s knowledge,
threatened claims, actions or lawsuits, or action by any Governmental
Authority, with respect to any Plan. There has been no prohibited transaction
or violation of the fiduciary responsibility rules with respect to any Plan.


 


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(c)           No
ERISA Event has occurred or is reasonably expected to occur; (i) the current
value of each Plan’s assets (determined in accordance with the assumptions used
for funding such Plan pursuant to Section 412 of the Code) are not less than
such Plan’s liabilities under Section 4001(a)(16) of ERISA; (ii) each Borrower
and Guarantor, and their ERISA Affiliates, have not incurred and do not
reasonably expect to incur, any liability under Title IV of ERISA with respect
to any Plan (other than premiums due and not delinquent under Section 4007 of
ERISA); (iii) each Borrower and Guarantor, and their ERISA Affiliates, have not
incurred and do not reasonably expect to incur, any liability (and no event has
occurred which, with the giving of notice under Section 4219 of ERISA, would
result in such liability) under Section 4201 or 4243 of ERISA with respect to a
Multiemployer Plan; and (iv) each Borrower and Guarantor, and their ERISA
Affiliates, have not engaged in a transaction that would be subject to Section
4069 or 4212(c) of ERISA.


 


8.10        Bank Accounts. All of the deposit
accounts, investment accounts or other accounts in the name of or used by any
Borrower or Guarantor maintained at any bank or other financial institution are
set forth on Schedule 8.10 to the Information Certificate, subject to the right
of each Borrower and Guarantor to establish new accounts in accordance with
Section 5.2 hereof.


 


8.11        Intellectual Property. Each
Borrower and Guarantor owns or licenses or otherwise has the right to use all
Intellectual Property necessary for the operation of its business as presently
conducted or proposed to be conducted. As of the date hereof, Borrowers and
Guarantors do not have any Intellectual Property registered, or subject to
pending applications, in the United States Patent and Trademark Office or any
similar office or agency in the United States, any State thereof, any political
subdivision thereof or in any other country, other than those described in
Schedule 8.11 to the Information Certificate and has not granted any licenses
with respect thereto other than as set forth in Schedule 8.11 to the
Information Certificate. No event has occurred which permits or would permit
after notice or passage of time or both, the revocation, suspension or
termination of such rights. No slogan or other advertising device, product,
process, method, substance or other Intellectual Property or goods bearing or
using any Intellectual Property presently contemplated to be sold by or
employed by any Borrower or Guarantor infringes any patent, trademark,
servicemark, tradename, copyright, license or other Intellectual Property owned
by any other Person presently and no claim or litigation is pending or
threatened against or affecting any Borrower or Guarantor contesting its right
to sell or use any such Intellectual Property, which could reasonably be
expected to have a Material Adverse Effect. Schedule 8.11 to the Information
Certificate sets forth all of the agreements or other arrangements of each
Borrower and Guarantor pursuant to which such Borrower or Guarantor has a
license or other right to use any trademarks, logos, designs, representations
or other Intellectual Property owned by another person as in effect on the date
hereof (collectively, together with such agreements or other arrangements as
may be entered into by any Borrower or Guarantor after the date hereof,
collectively, the “License Agreements” and individually, a “License Agreement”).
No trademark, servicemark, copyright or other Intellectual Property at any time
used by any Borrower or Guarantor which is owned by another person, or owned by
such Borrower or Guarantor subject to any security interest, lien, collateral
assignment, pledge or other encumbrance in favor of any person other than
Agent, is affixed to any Eligible Inventory, except (a) to the extent permitted
under the term of the license agreements listed on Schedule 8.11 to the
Information Certificate and (b) to the extent the sale of Inventory to which
such Intellectual Property is affixed is permitted to be sold by such Borrower
or Guarantor under applicable law (including the United States Copyright Act of
1976).


 


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8.12        Subsidiaries; Affiliates;
Capitalization; Solvency.


 


(a)           As
of the date hereof, each Borrower and Guarantor does not have any direct or
indirect Subsidiaries or Affiliates and is not engaged in any joint venture or
partnership except as set forth in Schedule 8.12 to the Information
Certificate.


 


(b)           As
of the date hereof, each Borrower and Guarantor is the record and beneficial
owner of all of the issued and outstanding shares of Capital Stock of each of
the Subsidiaries listed on Schedule 8.12 to the Information Certificate as
being owned by such Borrower or Guarantor and there are no proxies, irrevocable
or otherwise, with respect to such shares and no equity securities of any of
the Subsidiaries are or may become required to be issued by reason of any
options, warrants, rights to subscribe to, calls or commitments of any kind or
nature and there are no contracts, commitments, understandings or arrangements
by which any Subsidiary is or may become bound to issue additional shares of it
Capital Stock or securities convertible into or exchangeable for such shares.


 


(c)           As
of the date hereof, the issued and outstanding shares of Capital Stock of each
Borrower and Guarantor (other than Parent) are directly and beneficially owned
and held by the persons indicated in the Information Certificate, and in each
case all of such shares have been duly authorized and are fully paid and non-assessable,
free and clear of all claims, liens, pledges and encumbrances of any kind,
except as disclosed in writing to Agent prior to the date hereof.


 


(d)           Each
Borrower and Guarantor is Solvent and will continue to be Solvent after the
creation of the Obligations, the security interests of Agent and the other
transaction contemplated hereunder.


 


8.13        Labor Disputes.


 


(a)           Set
forth on Schedule 8.13 to the Information Certificate is a list (including
dates of termination) of all collective bargaining or similar agreements
between or applicable to each Borrower and Guarantor and any union, labor
organization or other bargaining agent in respect of the employees of any
Borrower or Guarantor on the date hereof.


 


(b)           Except
as could not reasonably be expected to have a Material Adverse Effect there is
(i) no unfair labor practice complaint pending against any Borrower or
Guarantor or, to the best of any Borrower’s or Guarantor’s knowledge,
threatened against it, before the National Labor Relations Board, and no
grievance or arbitration proceeding arising out of or under any collective
bargaining agreement is pending against any Borrower or Guarantor or, to best
of any Borrower’s or Guarantor’ s knowledge, threatened against it, and (ii) no
strike, labor dispute, slowdown or stoppage is pending against any Borrower or
Guarantor or, to the best of any Borrower’s or Guarantor’s knowledge,
threatened against any Borrower or Guarantor.


 


8.14         Restrictions
on Subsidiaries. Except for restrictions contained in this Agreement or any
other agreement with respect to Indebtedness of any Borrower or Guarantor
permitted hereunder as in effect on the date hereof, there are no contractual
or consensual restrictions on any Borrower or Guarantor which prohibit or
otherwise restrict (a) the transfer of cash or other assets between any
Borrower or Guarantor or (b) the ability of any Borrower or Guarantor to incur
Indebtedness or grant security interests to Agent or any Lender in the
Collateral.


 


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8.15         Material
Contracts. Schedule 8.15 to the Information Certificate sets forth all
Material Contracts to which any Borrower or Guarantor is a party or is bound as
of the date hereof. Borrowers and Guarantors have delivered true, correct and
complete copies of such Material Contracts to Agent on or before the date
hereof. Borrowers and Guarantors are not in breach or in default in any
material respect of or under any Material Contract and have not received any
notice of the intention of any other party thereto to terminate any Material
Contract which termination could be reasonably expected to have a Material
Adverse Effect.


 


8.16         Credit
Card Agreements. Set forth in Schedule 8.16 hereto is a correct and
complete list of all of the material Credit Card Agreements and all other
material agreements, documents and instruments existing as of the date hereof
between or among any Borrower or Guarantor (on the one hand) and any Credit
Card Issuer or Credit Card Processor (on the other hand). The Credit Card
Agreements constitute all of such agreements necessary for each Borrower to
operate its business as presently conducted with respect to credit cards and
debit cards and no Receivables of any Borrower arise from purchases by
customers of Inventory with credit cards or debit cards, other than those which
are issued by Credit Card Issuers with whom such Borrower has entered into one
of the Credit Card Agreements set forth on Schedule 8.16 hereto or with whom
Borrower has entered into a Credit Card Agreement in accordance with Section
9.18 hereof. Each of the Credit Card Agreements constitutes the legal, valid
and binding obligations of the Borrower that is party thereto and to the best
of each Borrower’s and Guarantor’s knowledge, the other parties thereto,
enforceable in accordance with their respective terms and is in full force and
effect. No material default or material event of default, or act, condition or
event which after notice or passage of time or both, would constitute a
material default or a material event of default under any of the Credit Card
Agreements exists or has occurred that would entitle the other party thereto to
suspend, withhold or reduce amounts that would otherwise be payable to a
Borrower. Each Borrower and the other parties thereto have complied in all material
respects with all of the terms and conditions of the Credit Card Agreements to
the extent necessary for such Borrower to be entitled to receive all payments
thereunder. Borrowers have delivered, or caused to be delivered to Agent, true,
correct and complete copies of all of the Credit Card Agreements.


 


8.17         Interrelated
Businesses. Borrowers and Guarantors make up a related organization of
various entities constituting a single economic and business enterprise so that
Borrowers and Guarantors share an identity of interests such that any benefit
received by any one of them benefits the others. Certain Borrowers and
Guarantors render services to or for the benefit of the other Borrowers and/or
Guarantors, as the case may be, purchase or sell and supply goods to or from or
for the benefit of certain others, make loans, advances and provide other
financial accommodations to or for the benefit of certain other Borrowers and
Guarantors (including inter alia, the payment by certain Borrowers and
Guarantors of creditors of certain other Borrowers or Guarantors and guarantees
by certain Borrowers and Guarantors of indebtedness of certain other Borrowers
and Guarantors and provide administrative, marketing, payroll and management
services to or for the benefit of certain other Borrowers and Guarantors). Certain
Borrowers and Guarantors have centralized accounting and legal services,
certain common officers and directors and generally do not provide
consolidating financial statements to creditors and Borrowers and Guarantors
have the same chief executive office.


 


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8.18         Payable
Practices. Each Borrower and Guarantor have not made any material change in
the historical accounts payable practices from those in effect immediately
prior to the date hereof.


 


8.19         Customer
Loyalty Account Assets . All cash, Cash Equivalents and other financial
assets at any time deposited in or credited to a Customer Loyalty Account
represent funds held by a Borrower or Guarantor to pay amounts owing by
Borrowers and Guarantors under a customer loyalty program maintained by
Borrowers and Guarantors. No Borrower or Guarantor shall use any such cash,
Cash Equivalents or other financial assets for any purpose other than to pay
such amounts, except as Agent may agree in writing. The aggregate balance of
all cash, Cash Equivalents and other financial assets at any time deposited in
or credited to the Customer Loyalty Accounts shall not exceed the lesser of (a)
the accrued and unpaid amounts owing by Borrowers and Guarantors under a
customer loyalty program maintained by Borrowers and Guarantors or (b)
$8,000,000.


 


8.20         Propco.
Each Propco does not own, and will not own or acquire, any assets other than
Real Property and Equipment.


 


8.21         Accuracy
and Completeness of Information. All information furnished by or on behalf
of any Borrower or Guarantor in writing to Agent or any Lender in connection
with this Agreement or any of the other Financing Agreements or any transaction
contemplated hereby or thereby, including all information on the Information
Certificate is true and correct in all material respects on the date as of
which such information is dated or certified and does not omit any material
fact necessary in order to make such information not misleading. No event or
circumstance has occurred which has had or could reasonably be expected to have
a Material Adverse Affect, which has not been fully and accurately disclosed to
Agent in writing (including through the public filings of TravelCenters which
have been made with the Securities and Exchange Commission) prior to the date
hereof.


 


8.22         Survival
of Warranties; Cumulative. All representations and warranties contained in
this Agreement or any of the other Financing Agreements shall survive the execution
and delivery of this Agreement and shall be deemed to have been made again to
Agent and Lenders on the date of each additional borrowing or other credit
accommodation hereunder and shall be conclusively presumed to have been relied
on by Agent and Lenders regardless of any investigation made or information
possessed by Agent or any Lender. The representations and warranties set forth
herein shall be cumulative and in addition to any other representations or
warranties which any Borrower or Guarantor shall now or hereafter give, or
cause to be given, to Agent or any Lender.


 


SECTION 9.                                AFFIRMATIVE
AND NEGATIVE COVENANTS


 


9.1          Maintenance of Existence.


 


(a)           Each
Borrower and Guarantor shall at all times preserve, renew and keep in full
force and effect its corporate or limited liability company existence and
rights and franchises with respect thereto and maintain in full force and
effect all licenses, trademarks, tradenames, approvals, authorizations, leases,
contracts and Permits necessary to carry on the business as presently or
proposed to be conducted, except as to any Guarantor as permitted in Section
9.7 hereto.


 


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(b)           No
Borrower or Guarantor shall change its name unless each of the following
conditions is satisfied: (i) Agent shall have received not less than thirty
(30) days prior written notice from Administrative Borrower of such proposed
change in its corporate name, which notice shall accurately set forth the new
name; and (ii) Agent shall have received a copy of the amendment to the
certificate of incorporation or formation of such Borrower or Guarantor
providing for the name change certified by the Secretary of State of the
jurisdiction of incorporation or organization of such Borrower or Guarantor as
soon as it is available.


 


(c)           No
Borrower or Guarantor shall change its chief executive office or its mailing
address or organizational identification number (or if it does not have one,
shall not acquire one) unless Agent shall have received not less than thirty
(30) days’ prior written notice from Administrative Borrower of such proposed
change, which notice shall set forth such information with respect thereto as
Agent may reasonably require and Agent shall have received such agreements as
Agent may reasonably require in connection therewith. No Borrower or Guarantor
shall change its type of organization, jurisdiction of organization or other
legal structure, except that any Borrower or Guarantor may change its type of
organization to a corporation or limited liability company and may change its
jurisdiction of organization to any state in the United States of America; provided,
that, (i) Agent shall have received not less than five (5) Business Days’
prior written notice (or such lesser period as to which Agent may agree) of the
intention of such Borrower or Guarantor to make such change, (ii) Agent shall
promptly receive true, correct and complete copies of all material agreements,
documents and instruments relating to such change, (iii) as of the effective
date of such change and after giving effect thereto, no Default or Event of
Default shall have occurred and be continuing and (iv) such Borrower or
Guarantor shall execute and deliver such agreements, documents and instruments
as Agent may reasonably request in connection therewith.


 


9.2          New Collateral Locations. Each
Borrower and Guarantor may only open any new location within the United States
other than locations outside the United States acquired pursuant to a Permitted
Acquisition.


 


9.3          Compliance with Laws, Regulations,
Etc.


 


(a)           Each
Borrower and Guarantor shall, at all times, comply in all material respects
with all laws, rules, regulations, licenses, approvals, orders and other
Permits applicable to it and duly observe all requirements of any foreign,
Federal, State or local Governmental Authority, except where such
non-compliance could not reasonably be expected to have a Material Adverse
Effect.


 


(b)           Borrowers
and Guarantors shall give written notice to Agent immediately upon any Borrower’s
or Guarantor’s receipt of any notice of, or any Borrower’s or Guarantor’s
otherwise obtaining knowledge of, (i) the occurrence of any event involving the
material release, spill or discharge, threatened or actual, of any Hazardous
Material in contravention of any applicable Environmental Law with respect to
any Real Property included in the calculation of the Borrowing Base or (ii) any
investigation, proceeding, complaint, order, directive, claims, citation or
notice with respect to: (A) any material non-compliance with or material
violation of any Environmental Law by any Borrower or Guarantor with respect to
any Real Property included in the calculation of the 


 


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Borrowing Base or
(B) the material release, spill or discharge, threatened or actual, of any
Hazardous Material in contravention of any applicable Environmental Law with
respect to any Real Property included in the calculation of the Borrowing Base.
Promptly upon the request of Agent, copies of all environmental surveys,
audits, assessments, feasibility studies and results of remedial investigations
shall be furnished, or caused to be furnished, by such Borrower or Guarantor to
Agent. Each Borrower and Guarantor shall take prompt action to respond to any
material non-compliance with any of the Environmental Laws and, promptly upon
the request of Agent, shall regularly report to Agent on such response.


 


(c)           Without
limiting the generality of the foregoing, whenever Agent reasonably determines
that there is material non-compliance, or any condition which requires any
action by or on behalf of any Borrower or Guarantor in order to avoid any
material non-compliance, with any Environmental Law with respect to any Real
Property included in the calculation of the Borrowing Base, Borrowers shall, at
Agent’s request and Borrowers’ expense: (i) cause an independent environmental
engineer reasonably acceptable to Agent to conduct such tests of the site where
material non-compliance or alleged material non-compliance with such
Environmental Laws has occurred as to such material non-compliance and prepare
and deliver to Agent a report as to such material non-compliance setting forth
the results of such tests, a proposed plan for responding to any environmental
problems described therein, and an estimate of the costs thereof and (ii)
provide to Agent a supplemental report of such engineer whenever the scope of
such material non-compliance, or such Borrower’s or Guarantor’s response
thereto or the estimated costs thereof, shall change in any material respect.


 


(d)           Each
Borrower and Guarantor shall indemnify and hold harmless Agent and Lenders and
their respective directors, officers, employees, agents, invitees,
representatives, successors and assigns, from and against any and all losses,
claims, damages, liabilities, costs, and expenses (including reasonable
attorneys’ fees and expenses) directly or indirectly arising out of or
attributable to the use, generation, manufacture, reproduction, storage,
release, threatened release, spill, discharge, disposal or presence of a
Hazardous Material, including the costs of any required or necessary repair,
cleanup or other remedial work with respect to any property of any Borrower or
Guarantor and the preparation and implementation of any closure, remedial or
other required plans ,except to the extent such losses, claims, damages,
liabilities, costs and expenses are caused by the gross negligence or willful
misconduct of Agent or any Lender. All representations, warranties, covenants
and indemnifications in this Section 9.3 shall survive the payment of the
Obligations and the termination of this Agreement.


 


9.4          Payment of Taxes and Claims. Each
Borrower and Guarantor shall duly pay and discharge all federal income taxes
and other material taxes, assessments, contributions and governmental charges
upon or against it or its properties or assets, except for (a) taxes the
validity of which are being contested in good faith by appropriate proceedings
diligently pursued and available to such Borrower or Guarantor, as the case may
be, and with respect to which adequate reserves have been set aside on its
books, or (b) taxes for which a valid and effective extension to file the
applicable tax return has been granted.


 


9.5          Insurance. Each Borrower and
Guarantor shall at all times, maintain with financially sound and reputable
insurers insurance with respect to the Collateral against loss or damage and
all other insurance of the kinds and in the amounts customarily insured against
or carried by corporations of established reputation engaged in the same or
similar businesses and similarly situated (it being understood that the
insurers of Borrowers and Guarantors and the kind and amount of insurance
maintained by Borrowers and Guarantors are acceptable to Agent as of the date
hereof); provided, that, nothing in this Section 9.5 shall
require Borrowers and 


 


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Guarantors to maintain insurance to insure against liabilities arising
from any non-compliance or alleged non-compliance with Environmental Laws. Said
policies of insurance shall be reasonably satisfactory to Agent as to form,
amount and insurer (it being understood that such policies of insurance are
satisfactory to Agent as of the date hereof). Borrowers and Guarantors shall
furnish certificates, policies or endorsements to Agent as Agent shall
reasonably require as proof of such insurance, and, if any Borrower or
Guarantor fails to do so, Agent is authorized, but not required, to obtain such
insurance at the expense of Borrowers. All policies shall provide for at least
thirty (30) days prior written notice to Agent of any cancellation or reduction
of coverage and that Agent may act as attorney for each Borrower and Guarantor,
at any time an Event of Default has occurred and is continuing, in obtaining
adjusting, settling, amending and canceling such insurance. Borrowers and
Guarantors shall cause Agent to be named as a loss payee and an additional
insured (but without any liability for any premiums) under such insurance
policies and Borrowers and Guarantors shall obtain non-contributory lender’s
loss payable endorsements to all insurance policies in form and substance
reasonably satisfactory to Agent. Such lender ‘s loss payable endorsements shall
specify that the proceeds of such insurance shall be payable to Agent as its
interests may appear and further specify that Agent and Lenders shall be paid
regardless of any act or omission by any Borrower, Guarantor or any of its or
their Affiliates. Without limiting any other rights of Agent or Lenders, any
insurance proceeds received by Agent at any time may be applied to payment of
the Obligations, whether or not then due, in any order and in such manner as
Agent may determine. Upon application of such proceeds to the Revolving Loans,
Revolving Loans may be available subject and pursuant to the terms hereof to be
used for the costs of repair or replacement of the Collateral lost or damages
resulting in the payment of such insurance proceeds. If an Event of Default has
occurred and is continuing or a Compliance Period or a Cash Dominion Period
exists, Borrowers and Guarantors shall, promptly upon the request of Agent,
maintain (a) a separate property insurance policy covering the assets leased to
a Borrower or Guarantor pursuant to a Lease Agreement and (b) a separate
property insurance policy covering all other assets of Borrowers and Guarantors
which comply with the terms of this Section 9.5.


 


9.6          Financial Statements and Other
Information.


 


(a)           Each
Borrower and Guarantor shall keep proper books and records in which true and
complete entries shall be made of all dealings or transactions of or in
relation to the Collateral and the business of such Borrower, Guarantor and its
Subsidiaries in accordance with GAAP. Borrowers and Guarantors shall promptly
furnish to Agent and Lenders all such financial and other information as Agent
shall reasonably request relating to the Collateral and the assets, business
and operations of Borrowers and Guarantors. Without limiting the foregoing,
Borrowers and Guarantors shall furnish or cause to be furnished to Agent, the
following: (i) in the event that Excess Availability plus Unrestricted Cash
shall have fallen below the amount equal to thirty-five (35%) percent of the
Maximum Credit during any month, then within forty-five (45) days after the end
of such fiscal month, monthly unaudited consolidated financial statements
(including balance sheets, statements of income and loss, and a cash flow
report which sets forth the items necessary to calculate the Fixed Charge
Coverage Ratio of  Parent and its
Subsidiaries), all in reasonable detail fairly presenting in all material
respects the financial position and results of the operations of Parent and its
Subsidiaries as of the end of and through such fiscal month, certified to be
correct by the chief financial officer of Parent, subject to normal year-end
adjustments and no footnotes and accompanied by a compliance certificate
substantially in the form of Exhibit C hereto (a “Compliance Certificate”),
along with a schedule 


 


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in a form
satisfactory to Agent of the calculations used in determining, as of the end of
such month, whether Borrowers and Guarantors are in compliance with the
covenants set forth in Section 9.17 of this Agreement for such month, (ii)
within forty-five (45) days after the end of each fiscal quarter (other than
the last fiscal quarter of each fiscal year), quarterly unaudited consolidated
financial statements (including in each case balance sheets, statements of
income and loss, and statements of cash flow), all in reasonable detail, fairly
presenting in all material respects the financial position and the results of
the operations of Parent and its Subsidiaries as of the end of and through such
fiscal quarter, certified to be correct by the chief financial officer of
Parent, subject to normal year-end adjustments and no footnotes and accompanied
by a Compliance Certificate, along with a schedule in a form satisfactory to
Agent of the calculations used in determining, as of the end of such quarter,
whether Borrowers and Guarantors are in compliance with the covenants set forth
in Section 9.17 of this Agreement for such quarter and (iii) within ninety (90)
days after the end of each fiscal year, audited consolidated financial
statements of Parent and its Subsidiaries (including in each case balance
sheets, statements of income and loss, statements of cash flow, and statements
of shareholders’ equity), and the accompanying notes thereto, all in reasonable
detail, fairly presenting in all material respects the financial position and
the results of the operations of Parent and its Subsidiaries as of the end of
and for such fiscal year, together with the unqualified opinion of independent
certified public accountants, which accountants shall be a “Big Four”
accounting firm or another independent accounting firm selected by Borrowers
and acceptable to Agent, that such audited financial statements have been
prepared in accordance with GAAP, and present fairly in all material respects
the results of operations and financial condition of Parent and its
Subsidiaries as of the end of and for the fiscal year then ended.


 


(b)           Borrowers
and Guarantors shall promptly notify Agent in writing of the details of (i) any
loss, damage, investigation, action, suit, proceeding or claim relating to
Collateral having a value of more than $1,000,000 or which if adversely
determined could reasonably be expected to have a Material Adverse Effect, (ii)
any Material Contract being terminated or of any Material Contract being
amended in any material respect or any new Material Contract entered into (in
which event Borrowers and Guarantors shall provide Agent with a copy of such
Material Contract), (iii) any order, judgment or decree in excess of $1,000,000
shall have been entered against any Borrower or Guarantor any of its or their
properties or assets, (iv) any notification of a material violation of laws or
regulations received by any Borrower or Guarantor, (v) any ERISA Event, and
(vi) the occurrence of any Default or Event of Default.


 


(c)           Borrowers
and Guarantors shall promptly after the sending or filing thereof furnish or
cause to be furnished to Agent copies of all reports which any Borrower or
Guarantor sends to its stockholders generally and copies of all reports and
registration statements which any Borrower or Guarantor files with the
Securities and Exchange Commission, any national securities exchange or the
National Association of Securities Dealers, Inc.


 


(d)           Borrowers
and Guarantors shall furnish or cause to be furnished to Agent projections of
Parent and its Subsidiaries for each fiscal year, no later than thirty (30)
days prior to the start of such fiscal year, and shall furnish or cause to be
furnished to Agent such other information respecting the Collateral and the
business of Borrowers and Guarantors, as Agent may, from time to time,
reasonably request; provided, that, Borrowers and Guarantors
shall not be required to deliver the projections for the fiscal year ending
December 31, 2008 until 


 


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March 31,
2008. Subject to the terms of Section 13.5 hereof, Agent is hereby authorized
to deliver a copy of any financial statement or any other information relating
to the business of Borrowers and Guarantors to any court or other Governmental
Authority or to any Lender or Participant or prospective Lender or Participant
or any Affiliate of any Lender or Participant. Each Borrower and Guarantor
hereby authorizes and directs any securities intermediary or other financial
institution at which any cash or Cash Equivalents of a Borrower constituting
Eligible Cash Collateral are maintained to provide directly to Agent such
information with respect to the accounts in which such cash or Cash Equivalents
are held and with respect to the cash or Cash Equivalents therein as Agent may
request and Borrowers and Guarantors shall so notify such securities
intermediaries or other financial institutions promptly upon Agent’s request. Any
documents, schedules, invoices or other papers delivered to Agent or any Lender
may be destroyed or otherwise disposed of by Agent or such Lender one (1) year
after the same are delivered to Agent or such Lender, except as otherwise
designated by Administrative Borrower to Agent or such Lender in writing.


 


9.7          Sale of Assets, Consolidation,
Merger, Dissolution, Etc. Each Borrower and Guarantor shall not directly or
indirectly:


 


(a)           merge
into or with or consolidate with any other Person or permit any other Person to
merge into or with or consolidate with it except  that (i) any
Borrower or Guarantor may merge with or into or consolidate with any other
Borrower or Guarantor (including any Person which becomes a Borrower or Guarantor
in connection with a Permitted Acquisition subject to the terms of Section
9.21(d) hereof) and (ii) any Borrower or Guarantor may merge with a newly
formed corporation or limited liability company organized in any state in the
United States of America which has no assets or liabilities solely for the
purpose of either changing the type of organization of such Borrower or
Guarantor to a corporation or limited liability company or changing the
jurisdiction of organization of such Borrower or Guarantor to any state in the
United States of America, provided, that, in each case each of
the following conditions is satisfied as determined by Agent in good faith: (A)
Agent shall receive prompt written notice of any such merger or consolidation,
(B) as of the effective date of the merger or consolidation and after giving
effect thereto, no Default or Event of Default shall have occurred and be
continuing, (C) in the case of a merger between any Borrower or Guarantor and
such newly formed corporation or limited liability company where such
corporation or limited liability company is the surviving corporation or
limited liability company, such corporation or limited liability company shall
have expressly confirmed, ratified and assumed the Obligations of such Borrower
or Guarantor and the Financing Agreements to which such Borrower or Guarantor
is a party, in form and substance reasonably satisfactory to Agent, and in the
case of a merger between any Borrower or Guarantor and such newly formed
corporation or limited liability company, such Borrower, Guarantor or newly
formed corporation or limited liability company shall execute and deliver such
other agreements, documents and instruments as Agent may reasonably request in
connection therewith, and (D) Agent shall promptly receive true, correct and
complete copies of all material agreements, documents and instruments relating
to such merger or consolidation; provided, further, that,
prior to the Petro Existing Security Agreement Termination Date, no Petro
Company shall be merged with or consolidate into any Borrower or Guarantor
other than another Petro Company;


 


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(b)           sell,
issue, assign, lease, license, transfer, abandon or otherwise dispose of any
Capital Stock or Indebtedness to any other Person or any of its assets to any
other Person, except  for


 


(i)            sales
of Inventory in the ordinary course of business,


 


(ii)           the
sale or other disposition of Equipment (including worn-out or obsolete
Equipment or Equipment no longer used or useful in the business of any Borrower
or Guarantor) and the sale of Real Property or the Capital Stock of any Propco;
provided, that, (A) as of the date of such sale or disposition
and after giving effect thereto, no Default or Event of Default shall have
occurred and be continuing, (B) such sale or disposition shall be on
commercially reasonable terms in a bona fide arms length transaction, (C) as of
the date of such sale or disposition and after giving effect thereto, Excess
Availability plus Unrestricted Cash shall not be less than $20,000,000, (D)
such sale or disposition shall not be in connection with any sale-leaseback
transaction (it being understood that any such sale-leaseback transaction shall
be governed by the terms of Section 9.7(b)(x) hereof), (E) if the Equipment or
Real Property to be sold or disposed of (including the Equipment or Real
Property owned by any Propco) is included in the Borrowing Base or if a Cash
Dominion Period exists, all of the net cash proceeds of such sale or
disposition shall promptly be paid to Agent for application to the Obligations
in accordance with Section 6.4(a) hereof,


 


(iii)          the
issuance and sale by Parent of Capital Stock of Parent (other than Disqualified
Capital Stock) after the date hereof; provided, that, (A) if a
Cash Dominion Period exists, Agent shall receive prompt written notice of such
issuance and sale and (B) if a Cash Dominion Period exists, all of the net cash
proceeds of the sale and issuance of such Capital Stock shall promptly be paid
to Agent for application to the Obligations in accordance with Section 6.4(a)
hereof,


 


(iv)          the
issuance of Capital Stock of any Borrower or Guarantor consisting of common
stock pursuant to an employee stock option or grant or similar equity plan or
401(k) plans of such Borrower or Guarantor for the benefit of its employees,
directors and consultants, provided, that, in no event shall such
Borrower or Guarantor be required to issue, or shall such Borrower or Guarantor
issue, Capital Stock pursuant to such stock plans or 401(k) plans which would
result in a Change of Control or other Event of Default, and


 


(v)           the
sale, transfer, lease, sublease or other disposition of assets of any Borrower
or Guarantor to another Borrower or Guarantor,


 


(vi)          the
grant of non-exclusive licenses of Intellectual Property in the ordinary course
of business,


 


(vii)         leases
or subleases of Real Property permitted under Section 9.8(m) or 9.12 hereof,


 


(viii)        the
sale or other disposition of Cash Equivalents for fair market value in the
ordinary course of business,


 


(ix)           the
issuance and sale by any Borrower (other than Parent) or Guarantor of its
Capital Stock (other than Disqualified Capital Stock) to another Borrower or 


 


85

















 


Guarantor; provided,
that, Agent shall have received, in form and substance reasonably
satisfactory to Agent (A) evidence that Agent has a valid and perfected first
priority security interest in and lien upon all such Capital Stock and (B) such
other agreements, documents and instruments as Agent may reasonably request to
effectuate the purpose and intent of clause (A) above,


 


(x)            the
sale of Real Estate and Equipment in connection with a sale-leaseback
transaction permitted under Section 9.7(d) hereof (including the sale of the
Capital Stock of any Propco and the leaseback of Real Property and Equipment
owned by such Propco),


 


(xi)           the
sale, transfer or other disposition by the Petro Companies to an Excluded
Subsidiary of the franchise agreements between any of the Petro Companies and
its franchisees; provided, that, as of the date of such sale,
transfer or disposition and after giving effect thereto, no Default or Event of
Default shall have occurred and be continuing, and


 


(xii)          the
sale or other disposition of assets of any Borrower or Guarantor not otherwise
permitted under the foregoing provisions of this Section 9.7(b) above (other
than the sale or disposition of Accounts of any Borrower or Guarantor or
Capital Stock of any Borrower); provided, that, (A) as of the
date of such sale or disposition and after giving effect thereto, no Default or
Event of Default shall have occurred and be continuing, (B) such sale or
disposition shall be on commercially reasonable terms in a bona fide arms
length transaction, (C) as of the date of such sale or disposition and after
giving effect thereto, the aggregate net book value of all of the assets so
sold or disposed of in any fiscal year of Parent shall not exceed $20,000,000,
(D) as of the date of such sale or disposition and after giving effect thereto,
Excess Availability plus Unrestricted Cash shall not be less than $20,000,000,
(E) such sale or disposition shall not be in connection with any sale-leaseback
transaction (it being understood that any such sale-leaseback transaction shall
be governed by the terms of Section 9.7(b)(x) hereof), (F) if any of the assets
to be sold or disposed of (including the Equipment or Real Property owned by
any Propco) is included in the Borrowing Base or if a Cash Dominion Period
exists, all of the net cash proceeds of such sale or disposition shall promptly
be paid to Agent for application to the Obligations in accordance with Section
6.4(a) hereof,


 


(c)           wind
up, liquidate or dissolve except  that any Guarantor may wind up,
liquidate and dissolve, provided, that, each of the following
conditions is satisfied, (i) effective upon such winding up, liquidation or
dissolution, all of the assets and properties of such Guarantor shall be duly
and validly transferred and assigned to a Borrower or another Guarantor, (ii)
Agent shall have received all documents and agreements that any Borrower or
Guarantor has filed with any Governmental Authority or as are otherwise
required to effectuate such winding up, liquidation or dissolution, (iii) no
Borrower or Guarantor shall assume any Indebtedness, obligations or liabilities
as a result of such winding up, liquidation or dissolution, or otherwise become
liable in respect of any obligations or liabilities of the entity that is
winding up, liquidating or dissolving, unless such Indebtedness is otherwise
expressly permitted hereunder, (iv) Agent shall receive prompt written notice
of any such winding up, liquidation or dissolution, and (v) as of the date of
such winding up, liquidation or dissolution and after giving effect thereto, no
Default or Event of Default shall have occurred and be continuing;


 


(d)           enter
into any sale-leaseback transaction, except for the sale-leaseback of Real
Property and Equipment (including the sale of the Capital Stock of any Propco
and the leaseback of Real Property and Equipment owned by such Propco); provided,
that, each of the 


 


86

















 


following
conditions is satisfied: (i) Agent shall receive prompt written notice of any
such sale-leaseback, (ii) promptly upon Agent’s request, Agent shall have
received true, correct and complete copies of all material agreements,
documents and instruments related to such sale-leaseback, (iii) as of the date
of the consummation of such sale-leaseback and after giving effect thereto, no
Default or Event of Default shall have occurred and be continuing, (iv) if any
Equipment or Real Property subject to such sale leaseback transaction (whether
directly or indirectly through Propco) is included in the Borrowing Base or if
a Cash Dominion Period exists, all of the net cash proceeds of such
sale-leaseback shall promptly be paid to Agent for application to the
Obligations in accordance with Section 6.4(a) hereof, (v) such sale-leaseback
transaction shall be on commercially reasonable terms in a bona fide
arms-length transaction, and (vi) as of the date of such sale-leaseback
transaction and after giving effect thereto, Excess Availability plus
Unrestricted Cash shall not be less than $20,000,000; and


 


(e)           agree
to do any of the foregoing.


 


Notwithstanding
anything to the contrary contained in this Agreement, no Borrower or Guarantor
(other than a Petro Company) shall, prior to the Petro Existing Security
Agreement Termination Date, sell, lease, transfer, assign, license, abandon or
otherwise dispose of any Capital Stock, Indebtedness or other assets to a Petro
Company unless, as of the date of any such sale, lease, transfer, assignment,
license, abandonment or disposition, no Default or Event of Default shall have
occurred and be continuing and Excess Availability plus Unrestricted Cash shall
not be less than an amount equal to the thirty-five (35%) percent of the
Maximum Credit.


 


9.8           Encumbrances.
Each Borrower and Guarantor shall not create, incur, assume or suffer to exist
any security interest, mortgage, pledge, lien, charge or other encumbrance of
any nature whatsoever on any of its assets or properties, including the
Collateral, or file or permit the filing of, or permit to remain in effect, any
financing statement or other similar notice of any security interest or lien
with respect to any such assets or properties, except:


 


(a)           the
security interests and liens of Agent for itself and the benefit of Secured
Parties;


 


(b)           liens
securing the payment of taxes, assessments or other governmental charges or
levies either not yet overdue or the validity of which are being contested in
good faith by appropriate proceedings diligently pursued and available to such
Borrower or Guarantor, as the case may be and with respect to which adequate
reserves have been set aside on its books;


 


(c)           non-consensual
statutory liens (other than liens securing the payment of taxes) arising in the
ordinary course of such Borrower’s or Guarantor’s business to the extent: (i)
such liens secure obligations which are not overdue or (ii) such liens secure
obligations relating to claims or liabilities which are being contested in good
faith by appropriate proceedings diligently pursued and available to such
Borrower or Guarantor, in each case prior to the commencement of foreclosure or
other similar proceedings and with respect to which adequate reserves have been
set aside on its books;


 


(d)           zoning
restrictions, easements, licenses, covenants and other restrictions affecting
the use of Real Property which do not interfere in any material respect with
the use of such Real Property or ordinary conduct of the business of such
Borrower or, Guarantor as 


 


87

















 


presently
conducted thereon or materially impair the value of the Real Property which may
be subject thereto;


 


(e)           purchase
money security interests in Equipment (including Capital Leases) to secure
Indebtedness permitted under Section 9.9(b) hereof;


 


(f)            pledges
and deposits of cash by any Borrower or Guarantor after the date hereof in the
ordinary course of business in connection with workers’ compensation,
unemployment insurance and other types of social security benefits consistent
with the current practices of such Borrower or Guarantor as of the date hereof;


 


(g)           pledges
and deposits of cash by any Borrower or Guarantor after the date hereof to
secure the performance of tenders, bids, leases, trade contracts (other than
for the repayment of Indebtedness), statutory obligations and other similar
obligations in each case in the ordinary course of business consistent with the
current practices of such Borrower or Guarantor as of the date hereof;


 


(h)           liens
arising from (i) any Lease Agreement (or sublease with respect thereto)
and the precautionary UCC financing statement filings in respect thereof and
(ii) equipment or other materials which are not owned by any Borrower or
Guarantor located on the premises of such Borrower or Guarantor (but not in
connection with, or as part of, the financing thereof) from time to time in the
ordinary course of business and consistent with current practices of such
Borrower or Guarantor and the precautionary UCC financing statement filings in
respect thereof;


 


(i)            judgments
and other similar liens arising in connection with court proceedings that do
not constitute an Event of Default, provided, that, (i) adequate
reserves or other appropriate provision, if any, as are required by GAAP have
been made therefor, (ii) such judgment or lien shall be effectively stayed or
bonded within thirty (30) days after the date such judgment or lien first arose
and (iii) Agent may establish a Reserve with respect thereto;


 


(j)            liens
or rights of setoff against credit balances of Borrowers and Guarantors with
Credit Card Issuers or Credit Card Processors or amounts owing by such Credit
Card Issuers or Credit Card Processors to Borrowers or Guarantors in the
ordinary course of business, but not liens on or rights of setoff against any
other property or assets of Borrowers or Guarantors, pursuant to the Credit
Card Agreements to secure the obligations of Borrowers and Guarantors to the
Credit Card Issuers or Credit Card Processors as a result of fees and
chargebacks;


 


(k)           liens
in favor of JPMorgan Chase Bank (“Chase”) and/or Wells Fargo Bank (“Wells”) on
cash collateral deposited with Chase and/or Wells on or prior to the date
hereof in an aggregate amount not to exceed $36,837,000 to secure the letters
of credit issued by Chase and/or Wells which are listed on Schedule 9.9 to the
Information Certificate;


 


(l)            security
interests in or liens on Equipment and Real Property of Borrowers and
Guarantors (other than Equipment or Real Property included in the Borrowing
Base) or the Capital Stock of any Propco to secure Indebtedness permitted under
Section 9.9(h) hereof;


 


88

















 


(m)          leases
or subleases of Real Property granted by any Borrower or Guarantor in the
ordinary course of business and consistent with past practice (i) to its
franchisees and (ii) to any Person so long as any such leases or subleases
pursuant to this clause (ii) do not interfere in any material respect with the
use of such Real Property or the ordinary conduct of the business of such
Borrower or Guarantor as presently conducted thereon or materially impair the
value of such Real Property;


 


(n)           security
interests in and liens on the assets of the Petro Companies (including, without
limitation, the Petro Indenture Cash Collateral) and the Capital Stock in Petro
in favor of the Petro Indenture Trustee to secure the Indebtedness permitted
under Section 9.9(j) hereof; provided, that, such security
interests and liens on the Petro Indenture Cash Collateral shall be terminated
and released by no later than May 15, 2008 and such security interests and
liens on the assets of the Petro Companies (other than the Petro Indenture Cash
Collateral) and the Capital Stock in Petro shall be terminated on the Petro
Existing Security Agreement Termination Date;


 


(o)           security
interests in and liens on the assets of the Petro Companies (excluding the
Petro Indenture Cash Collateral) and the Capital Stock in Petro in favor of
ExxonMobil to secure trade liabilities owing by the Petro Companies to
ExxonMobil in an aggregate amount not to exceed $15,000,000; provided, that,
such security interests and liens shall be terminated and released on the Petro
Existing Security Agreement Termination Date; and


 


(p)           the
security interests and liens set forth on Schedule 8.4 to the Information
Certificate which are not otherwise permitted under this Section 9.8 above.


 


9.9      Indebtedness. Each Borrower and
Guarantor shall not incur, create, assume, become or be liable in any manner
with respect to, or permit to exist, any Indebtedness, or guarantee, assume,
endorse, or otherwise become responsible for (directly or indirectly), the
Indebtedness, performance, obligations or dividends of any other Person, except:


 


(a)           the
Obligations;


 


(b)           purchase
money Indebtedness (including Capital Leases) arising after the date hereof to
the extent secured by purchase money security interests in Equipment (including
Capital Leases) not to exceed $25,000,000 in the aggregate at any time outstanding
so long as such security interests do not apply to any property of such
Borrower or Guarantor other than the Equipment so acquired, and the
Indebtedness secured thereby does not exceed the cost of the Equipment so
acquired, as the case may be;


 


(c)           (i)
guarantees by any Borrower or Guarantor of any Indebtedness of another Borrower
or Guarantor which is permitted under this Section 9.9 and (ii) guarantees by
any Borrower or Guarantor of any liabilities (other than Indebtedness) of
another Borrower or Guarantor so long as such other Borrower or Guarantor is
not prohibited from incurring such liabilities by the terms of this Agreement;


 


(d)           the
Indebtedness of any Borrower or Guarantor to any other Borrower or Guarantor
arising after the date hereof pursuant to loans by any Borrower or Guarantor
permitted under Section 9.10(g) hereof;


 


89

















 


(e)           unsecured
Indebtedness of any Borrower or Guarantor arising after the date hereof to any
third person (but not to any other Borrower or Guarantor), provided, that,
each of the following conditions is satisfied as determined by Agent: (i) if
the amount of such Indebtedness to be incurred exceeds $20,000,000, Agent shall
have received not less than five (5) Business Days (or such lesser period as to
which Agent may agree) of the intention of such Borrower or Guarantor to incur
such Indebtedness, (ii) upon Agent’s request Agent shall have received true,
correct and complete copies of all material agreements, documents and
instruments evidencing or otherwise related to such Indebtedness, (iii) as of
the date of incurring such Indebtedness and after giving effect thereto, no
Default or Event of Default shall have occurred and be continuing, and (iv)
Borrowers and Guarantors shall furnish to Agent all demands or material notices
in connection with such Indebtedness either received by any Borrower or
Guarantor or on its behalf promptly after the receipt thereof, or sent by any
Borrower or Guarantor or on its behalf concurrently with the sending thereof,
as the case may be;


 


(f)            Indebtedness
of any Borrower or Guarantor entered into in the ordinary course of business
pursuant to a Hedge Agreement; provided, that, (i) such arrangements are with a
Bank Product Provider, (ii) such arrangements are for bona fide hedging
purposes, and (iii) such Indebtedness shall be unsecured, except to the
extent such Indebtedness constitutes part of the Obligations arising under or
pursuant to Hedge Agreements with any Bank Product Provider that are secured
under the terms hereof;


 


(g)           unsecured
guarantees by a Borrower or Guarantor of the obligations of a Specified
Subsidiary or another Borrower or Guarantor arising under a Lease Agreement (or
a sublease with respect thereto); provided, that, (i) the Person
issuing such guarantee is permitted hereunder to incur directly the obligation
that is being guaranteed and (ii) as of the date on which such guarantee is
issued and after giving effect thereto, no Event of Default has occurred and is
continuing;


 


(h)           Indebtedness
of any Borrower or Guarantor arising after the date hereof to any third person
(but not to any other Borrower or Guarantor) secured by a security interest in
or lien on Real Property or Equipment of any Borrower or Guarantor or the Capital
Stock of any Propco, provided, that, each of the following conditions is
satisfied as reasonably determined by Agent: (i) Agent shall have received not
less than five (5) Business Days prior written notice (or such lesser notice
period as to which Agent may reasonably agree) of the intention of such
Borrower or Guarantor to incur such Indebtedness, except that, if such
Indebtedness is incurred in connection with a Permitted Acquisition where the
consideration paid or payable is less than or equal to $25,000,000, Agent shall
receive prompt written notice thereof as is reasonably practicable under the
circumstances, (ii) promptly upon Agent’s request, Agent shall have received
true, correct and complete copies of all material agreements, documents and
instruments evidencing or otherwise related to such Indebtedness, (iii) as of
the date of incurring such Indebtedness (excluding Qualified Assumed
Indebtedness), Agent shall have received evidence, in form and substance
reasonably satisfactory to it, which demonstrates that Parent and its Tested
Subsidiaries (on a consolidated basis) would have had a Debt Incurrence Ratio
of not less than 1.10 to 1.00 for the most recently ended period of twelve (12)
consecutive months for which Agent has received financial statements of Parent
and its Subsidiaries, determined on a pro forma basis as if such Indebtedness
(excluding Qualified Assumed Indebtedness incurred on such date) had been
incurred on the first day of such period; (iv) as of the date of incurring such
Indebtedness and after giving effect thereto, no Default or Event of Default
shall have occurred 


 


90

















 


and be continuing,
and (v) Borrowers and Guarantors shall furnish to Agent all demands or material
notices in connection with such Indebtedness either received by any Borrower or
Guarantor or on its behalf promptly after the receipt thereof, or sent by any
Borrower or Guarantor or on behalf concurrently with the sending thereof, as
the case may be;


 


(i)            Indebtedness
of any Borrower or Guarantor under any commodity hedge, commodity swap or
similar agreement entered into in the ordinary course of business for the
purpose of protecting against or managing exposure to fluctuations in commodity
prices; provided, that, (i) such arrangements are with a bank or
other financial institution that has combined capital and surplus and undivided
profits of not less than $1,000,000,000, (ii) such arrangements are for bona
fide hedging purposes, and (iii) such Indebtedness shall be unsecured (but such
Indebtedness may be supported by a Letter of Credit Accommodation issued in
accordance with the terms hereof);


 


(j)            Indebtedness
of the Petro Companies evidenced by or arising under the Petro Indenture; provided,
that, (i) the aggregate outstanding principal amount of such
Indebtedness shall not exceed $250,000,000, (ii) such Indebtedness shall at all
times be secured by the Petro Indenture Cash Collateral and (iii) the Petro
Indenture Cash Collateral shall be applied to redeem all such Indebtedness,
together with all interest, fees, premiums, and penalties owing in respect
thereof, by no later than February 15, 2008; and


 


(k)           the
Indebtedness set forth on Schedule 9.9 to the Information Certificate which is
not otherwise permitted by this Section 9.9 above; provided, that,
Borrowers and Guarantors shall furnish to Agent all demands or material notices
in connection with such Indebtedness either received by any Borrower or
Guarantor or on its behalf, promptly after the receipt thereof, or sent by any
Borrower or Guarantor or on its behalf, concurrently with the sending thereof,
as the case may be.


 


Notwithstanding
anything to the contrary contained in this Agreement, the Petro Companies and
Petro Holdings shall not, prior to the Petro Existing Security Agreement
Termination Date, incur, create, assume, become liable with respect to, or
permit to exist any Indebtedness, or guarantee, assume, endorse, or become
responsible for (directly or indirectly), the Indebtedness of any other Person,
except for Indebtedness permitted under Sections 9.9(a), (e), (j) and (k); provided,
that, any such Indebtedness of the Petro Companies and Petro Holdings
under Section 9.9(e) hereof shall be subordinated in an manner reasonably
satisfactory to Agent.


 


9.10         Loans,
Investments, Etc. Each Borrower and Guarantor shall not, directly or
indirectly, make any loans or advance money or property to any person, or
invest in (by capital contribution, dividend or otherwise) or purchase or
repurchase the Capital Stock or Indebtedness or all or a substantial part of
the assets or property of any person, or form or acquire any Subsidiaries, or
agree to do any of the foregoing, except:


 


(a)           the
endorsement of instruments for collection or deposit in the ordinary course of
business;


 


(b)           investments
in cash or Cash Equivalents, provided, that, (i) if a Cash
Dominion Period exists, no Loans are then outstanding, except that
notwithstanding that any Loans are outstanding if a Cash Dominion Period
exists, (A) Borrowers and Guarantors may from time to time in the ordinary
course of business consistent with their current practices as of 


 


91

















 


the date hereof
make deposits of cash in bank accounts used for disbursements to the extent
required to provide funds for amounts drawn or anticipated to be drawn shortly
on such accounts and such funds may be held in Cash Equivalents consisting of
overnight investments until so drawn (so long as such funds and Cash
Equivalents are not held more than three (3) Business Days from the date of the
initial deposit thereof) and (B) Borrowers and Guarantors may have cash at
retail store locations and in Store Accounts to the extent permitted in Section
6.3(a) hereof and (ii) the terms and conditions of Section 5.2 hereof shall
have been satisfied with respect to the deposit account, investment account or
other account in which such cash or Cash Equivalents are held;


 


(c)           the
equity investments made by each Borrower and Guarantor prior to the date hereof
in any of its Subsidiaries which are not Borrowers or Guarantors;


 


(d)           loans
and advances by any Borrower or Guarantor to employees of such Borrower or
Guarantor not to exceed the principal amount of $5,000,000 in the aggregate at
any time outstanding for: (i) reasonably and necessary work-related travel or
other ordinary business expenses to be incurred by such employee in connection
with their work for such Borrower or Guarantor and (ii) reasonable and
necessary relocation expenses of such employees (including home mortgage
financing for relocated employees);


 


(e)           stock
or obligations issued to any Borrower or Guarantor by any Person (or the
representative of such Person) in respect of Indebtedness of such Person owing
to such Borrower or Guarantor in connection with the insolvency, bankruptcy,
receivership or reorganization of such Person or a composition or readjustment
of the debts of such Person;


 


(f)            obligations
of account debtors to any Borrower or Guarantor arising from Accounts which are
past due evidenced by a promissory note made by such account debtor payable to
such Borrower or Guarantor; provided, that, promptly upon the
receipt of the original of any such promissory note by such Borrower or
Guarantor, such promissory note shall be endorsed to the order of Agent by such
Borrower or Guarantor and promptly delivered to Agent as so endorsed to the
extent required by Section 5.2(b) hereof;


 


(g)           loans
by a Borrower or Guarantor to another Borrower or Guarantor after the date
hereof, provided, that,


 


(i)            as
to all of such loans, the Indebtedness arising pursuant to any such loan shall
not be evidenced by a promissory note or other instrument, unless the single
original of such note or other instrument is promptly delivered to Agent upon
its request to hold as part of the Collateral, with such endorsement and/or
assignment by the payee of such note or other instrument as Agent may require,
and


 


(ii)           as
to loans by a Guarantor to a Borrower, (A) the Indebtedness arising pursuant to
such loan shall be subject to, and subordinate in right of payment to, the
right of Agent and Lenders to receive the prior final payment and satisfaction
in full of all of the Obligations on terms and conditions reasonably acceptable
to Agent, and (B) promptly upon Agent’s request, Agent shall have received a
subordination agreement, in form and substance reasonably satisfactory to
Agent, providing for the terms of the subordination in right of payment of such
Indebtedness of such Borrower to the prior final payment and satisfaction in
full of all of the Obligations, duly authorized, executed and delivered by such
Guarantor and such Borrower 


 


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(it being
understood that, so long as no Event of Default has occurred and is continuing,
such Borrower may pay, and such Guarantor may receive, payments of principal
and interest in respect of such Indebtedness);


 


(h)           any
Permitted Acquisition; provided, that, in no event shall any
assets acquired pursuant to any Permitted Acquisition be deemed to be Eligible
Accounts, Eligible Equipment, Eligible Real Property, Eligible Credit Card
Receivables or Eligible Inventory unless the following conditions shall be
satisfied as determined by Agent: (1) Agent shall have received an appraisal of
the Inventory of the Acquired Business and such other assets of the Acquired
Business as Agent may specify, in each case in form and containing assumptions
and appraisal methods satisfactory to Agent by an appraiser acceptable to
Agent, on which Agent and Lenders are expressly permitted to rely, and (2)
Agent shall have completed a field examination with respect to the business and
assets of the Acquired Business in accordance with Agent’s customary procedures
and practices and as otherwise required by the nature and circumstances of the
business of the Acquired Business, the scope and results of which shall be
satisfactory to Agent and any accounts, credit card receivables, inventory,
equipment or real estate of the Acquired Business shall only be Eligible
Accounts, Eligible Credit Card Receivables, Eligible Inventory, Eligible
Equipment or Eligible Real Property (as the case may be) to the extent the
criteria for Eligible Accounts, Eligible Credit Card Receivables, Eligible
Inventory, Eligible Equipment or Eligible Real Property (as the case may be)
set forth herein are satisfied with respect thereto in accordance with this
Agreement (or such other or additional criteria as Agent may in good faith
establish with respect thereto in accordance with this Agreement and subject to
such Reserves as Agent may in good faith establish in connection with the
Acquired Business);


 


(i)            equity
investments by each Borrower and Guarantor in another Borrower or Guarantor;


 


(j)            loans
and other investments by a Borrower or Guarantor to a Person that is neither an
HPT Company or an Affiliate of a Borrower or Guarantor; provided, that,
(i) as of the date of such loan or investment and after giving effect thereto,
Excess Availability plus Unrestricted Cash shall not be less than the amount
equal to thirty-five (35%) percent of the Maximum Credit, (ii) such loans and
investments are not made in connection with a Permitted Acquisition, and (iii)
as of the date of such loan or investment and after giving effect thereto, no
Default or Event of Default shall have occurred and be continuing;


 


(k)           loans
and other investments by a Borrower or Guarantor to Excluded Subsidiaries; provided,
that, (i) as of the date of such loan or investment and after giving
effect thereto, Excess Availability plus Unrestricted Cash shall not be less
than the amount equal to thirty-five (35%) percent of the Maximum Credit, (ii)
as of the date of such loan or investment and after giving effect thereto, no
Default or Event of Default shall have occurred and be continuing, (iii) all
Indebtedness and other obligations of the Excluded Subsidiaries shall be
non-recourse to Borrowers and Guarantors and their respective assets and (iv)
the aggregate amount of all such loans and investments in Excluded Subsidiaries
shall not exceed $5,000,000;


 


(l)            the
formation of any Subsidiary; provided, that, if any Subsidiary is
formed for the purpose of making, or in anticipation of consummating, a
Permitted Acquisition, Agent shall have received all items required by Sections
5.2 and 9.21 hereof with respect to such Subsidiary (subject to the terms of
Section 9.21(d) hereof); and


 


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(m)          the
loans and advances set forth on Schedule 9.10 to the Information Certificate
which are not otherwise permitted by this Section 9.10 above; provided ,
that, as to such loans and advances, Borrowers and Guarantors shall not,
directly or indirectly, amend, modify, alter or change the terms of such loans
and advances or any agreement, document or instrument related thereto.


 


Notwithstanding
anything to the contrary contained in this Agreement, no Borrower or Guarantor
(other than a Petro Company) shall, prior to the Petro Existing Security
Agreement Termination Date, make any loans or advances to, invest in, or purchase
or repurchase any Capital Stock, Indebtedness or other assets of, any Petro
Company unless, as of the date of any such loan, advance, investment, purchase
or repurchase, no Default of Event of Default shall have occurred and be
continuing and Excess Availability plus Unrestricted Cash shall not be less
than an amount equal to thirty-five (35%) percent of the Maximum Credit.


 


9.11         Dividends
and Redemptions. Each Borrower and Guarantor shall not through any manner
or means, directly or indirectly, declare, order, pay, make or set apart, or
agree to declare, order, pay, make or set apart, any sum for any Restricted
Payment except  that:


 


(a)           any
Borrower or Guarantor (other than Parent) may make Restricted Payments to any
other Borrower or Guarantor;


 


(b)           Borrowers
and Guarantors may pay dividends to the extent permitted in Section 9.12 below;


 


(c)           Parent
may make Restricted Payments in cash, from funds legally available therefor; provided,
that, with respect to each such Restricted Payment: (i) Agent shall have
received at least five (5) Business Days prior written notice (or such lesser
notice period as to which Agent may agree) thereof, (ii) as of the date of any
such payment and after giving effect thereto, Excess Availability plus
Unrestricted Cash shall not be less than the amount equal to thirty-five (35%)
percent of the Maximum Credit, and (iii) as of the date of any such Restricted
Payment and after giving effect thereto, no Default or Event of Default shall
have occurred and be continuing; and


 


(d)           Parent
may make Restricted Payments in the form of Capital Stock of Parent (other than
Disqualified Capital Stock); and


 


(e)           Parent
may repurchase Capital Stock of Parent deemed to occur upon the cashless
exercise of stock options or warrants if such Capital Stock represents a
portion of the exercise price of such options or warrants; provided, that,
no Borrower or Guarantor shall pay, or be required to pay, any amounts in
respect of any such repurchase other than in the form of Capital Stock of
Parent (other than Disqualified Capital Stock).


 


Notwithstanding
anything to the contrary contained in this Agreement, no Borrower or Guarantor
(other than a Petro Company) shall, prior to the Petro Existing Security
Agreement Termination Date, make or pay any Restricted Payment to any Petro
Company (except for a Restricted Payment in the form of capital stock other
than Disqualified Capital Stock) unless, as of the date of any such Restricted
Payment, no Default of Event of Default shall have occurred and be continuing
and Excess Availability plus Unrestricted Cash shall not be less than an amount
equal to thirty-five (35%) percent of the Maximum Credit.


 


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9.12    Transactions with Affiliates and HPT
Companies. Each Borrower and Guarantor shall not, directly or indirectly:


 


(a)           purchase,
acquire or lease any property from, or sell, transfer or lease any property to,
any Affiliate of such Borrower or Guarantor, except (i) in the ordinary course
of and pursuant to the reasonable requirements of such Borrower’s or Guarantor’s
business (as the case may be) and upon fair and reasonable terms in a bona fide
arm’s length transaction as reasonably determined by the independent directors
of Parent, (ii) transactions among or between any Borrower or Guarantor and any
other Borrower or Guarantor which are not prohibited by this Agreement or any
other Financing Agreement, and (iii) the transactions contemplated by the Petro
Travel Plaza Operating Agreement (as in effect on the date hereof);


 


(b)           make
any payments (whether by dividend, loan or otherwise) of management, consulting
or other fees for management or similar services, or of any Indebtedness owing
to any Affiliate of such Borrower or Guarantor, except (i) reasonable
compensation to executive officers or directors for services rendered to such
Borrower or Guarantor in the ordinary course of business, and (ii) regularly
scheduled payments of management fees due and payable in accordance with the
terms of the Shared Services Agreement as in effect on the date hereof;


 


(c)           purchase,
acquire or lease any property from, or sell, transfer or lease any property to,
any HPT Company, except pursuant to the reasonable requirements of such
Borrower’s or Guarantor’s business and upon fair and reasonable terms as
reasonably determined by the independent directors of Parent;


 


(d)           enter
into any lease with any HPT Company after the date hereof unless Agent shall
have received an agreement, in form and substance reasonably satisfactory to
Agent, duly executed and delivered by such HPT Company (it being agreed that
such agreement shall be satisfactory to Agent if it is substantially similar to
the Letter Agreement, dated on or about the date hereof, among HPT TA
Properties Trust, HPT TA Properties LLC and Agent); or


 


(e)           request
or obtain, without the prior written consent of Agent, any services in which a
Person (other than a Borrower or Guarantor) would, directly or indirectly,
monitor, invoice or collect any Collateral of a Borrower or Guarantor, prepare
or generate any financial statements of a Borrower or Guarantor, or administer
all or any part of the cash management system of a Borrower or Guarantor.


 


9.13    Compliance with ERISA. Each Borrower
and Guarantor shall, and shall cause each of its ERISA Affiliates, to: (a)
maintain each Plan in compliance in all material respects with the applicable
provisions of ERISA, the Code and other Federal and State law; (b) cause each
Plan which is qualified under Section 401(a) of the Code to maintain such qualification;
(c) not terminate any of such Plans so as to incur any material liability to
the Pension Benefit Guaranty Corporation; (d) not allow or suffer to exist any
prohibited transaction involving any of such Plans or any trust created
thereunder which would subject such Borrower, Guarantor or such ERISA Affiliate
to a material tax or penalty or other liability on prohibited transactions
imposed under Section 4975 of the Code or ERISA; (e) make all required
contributions to any Plan which it is obligated to pay under Section 302 of
ERISA, Section 412 of the Code or the terms of such Plan; (f) not allow or
suffer to exist any accumulated funding deficiency, whether or not waived, with
respect to any such Plan; or (g) allow or suffer to exist any occurrence of a
reportable event


 


95

















 


or any other event or condition which presents a material risk of
termination by the Pension Benefit Guaranty Corporation of any such Plan that
is a single employer plan, which termination could result in any material
liability to the Pension Benefit Guaranty Corporation.


 


9.14        End of Fiscal Years; Fiscal Quarters.
Each Borrower and Guarantor shall, for financial reporting purposes, cause its,
and each of its Subsidiaries’ (a) fiscal years to end on December 31 of
each year and (b) fiscal quarters to end on March 31, June 30,
September 30 and December 31 of each year.


 


9.15        Change in Business. Each Borrower
and Guarantor shall not engage in any business other than the business of such
Borrower or Guarantor on the date hereof and any business reasonably related,
ancillary or complimentary to the business in which such Borrower or Guarantor
is engaged on the date hereof.


 


9.16        Limitation of Restrictions Affecting
Subsidiaries. Each Borrower and Guarantor shall not, directly, or
indirectly, create or otherwise cause or suffer to exist any encumbrance or
restriction which prohibits or limits the ability of any Borrower or Guarantor
to (a) pay dividends or make other distributions or pay any Indebtedness owed
to  such Borrower or Guarantor; (b) make
loans or advances to such Borrower or Guarantor, (c) transfer any of its
properties or assets to such Borrower or Guarantor; or (d) create, incur,
assume or suffer to exist any lien upon any of its property, assets or
revenues, whether now owned or hereafter acquired, other than encumbrances and
restrictions arising under (i) applicable law, (ii) this Agreement, (iii)
customary provisions restricting subletting or assignment of any lease governing
a leasehold interest of such Borrower or Guarantor, (iv) customary restrictions
on dispositions of real property interests found in reciprocal easement
agreements of such Borrower or Guarantor, (v) any agreement relating to
permitted Indebtedness incurred by such Borrower or Guarantor prior to the date
hereof or relating to any Indebtedness incurred by such Borrower or Guarantor
after the date hereof which is permitted under Section 9.9(e), (f), (h) and
(i), (vi) customary provisions in license agreements restricting assignments or
transfers of the rights of a licensee under such license agreement and (vii)
the Existing HPT Leases (as in effect on the date hereof) and any other Lease
Agreement entered into after the date hereof; provided, that, any
such encumbrances or restrictions contained in any other Lease Agreement (taken
as a whole) are not materially less favorable to Borrowers, Guarantors, Agent
or Lenders than those encumbrances and restrictions under the Existing HPT
Leases (as in effect on the date hereof).


 


9.17        Minimum Fixed Charge Coverage Ratio.
If a Compliance Period exists, the Fixed Charge Coverage Ratio of Parent and
its Tested Subsidiaries (on a consolidated basis) for the most recently ended
period of twelve (12) consecutive months for which Agent has received financial
statements of Parent and its Subsidiaries shall not be less than 1.00 to 1.00.


 


9.18        Credit Card Agreements. Each
Borrower and Guarantor shall (a) observe and perform in all material respects
all material terms, covenants, conditions and provisions of the Credit Card
Agreements to be observed and performed by it at the times set forth therein;
and (b) at all times maintain in full force and effect the Credit Card
Agreements, except, that, any Borrower or Guarantor may terminate or cancel any
of the Credit Card Agreements in the ordinary course of the business of such
Borrower or Guarantor; provided, that, such Borrower or Guarantor
shall give Agent prior written notice of its intention to do so. Upon any
Borrower or Guarantor entering any new Credit Card Agreements with a new Credit
Card Issuer or Credit Card Processor, such Borrower or Guarantor shall furnish
to Agent prior written notice of the 


 


96

















 


intention of such Borrower or Guarantor to enter into such agreement
(together with such other information with respect thereto as Agent may
reasonably request) and, promptly upon Agent’s request,  a Credit Card Acknowledgment in favor of
Agent, as executed by such new Credit Card Issuer or Credit Card Processor. Promptly
upon the request of Agent, Borrowers shall furnish to Agent such information
and evidence as Agent may reasonably require from time to time concerning the
observance, performance and compliance by Borrowers or the other party or
parties thereto with the terms, covenants or provisions of the Credit Card
Agreements.


 


9.19    License Agreements.


 


(a)           Each
Borrower and Guarantor shall (i) promptly and faithfully observe and perform
all of the terms, covenants, conditions and provisions of the Material License
Agreements to be observed and performed by it, at the times set forth therein,
if any, (ii) not do, permit, suffer or refrain from doing anything that could
reasonably be expected to result in a default under or breach of any of the
terms of any Material License Agreement, (iii) not cancel, surrender, modify,
amend, waive or release any Material License Agreement in any material respect
or any term, provision or right of the licensee thereunder in any material
respect, or consent to or permit to occur any of the foregoing; except, that,
subject to Section 9.19(b) below, such Borrower or Guarantor may modify, amend,
waive, cancel, surrender or release any Material License Agreement; provided,
that, such Borrower or Guarantor (as the case may be) shall give Agent not less
than thirty (30) days prior written notice (or such lesser notice period as to
which Agent may agree) of its intention to so cancel, surrender and release any
such Material License Agreement, (iv) give Agent prompt written notice of any
Material License Agreement entered into by such Borrower or Guarantor after the
date hereof, together with a true, correct and complete copy thereof and such
other information with respect thereto as Agent may reasonably request, (v)
give Agent prompt written notice of any material breach of any obligation, or
any default, by any party under any Material License Agreement, and deliver to
Agent (promptly upon the receipt thereof by such Borrower or Guarantor in the
case of a notice such Borrower or Guarantor and concurrently with the sending
thereof in the case of a notice to such Borrower or Guarantor) a copy of each
notice of default and every other similar notice or other communication
received or delivered by such Borrower or Guarantor in connection with any
Material License Agreement which relates to the right of such Borrower or
Guarantor to continue to use property subject to such License Agreement, and
(vi) furnish to Agent, promptly upon the request of Agent, such information and
evidence as Agent may reasonably require from time to time concerning the
observance, performance and compliance by such Borrower or Guarantor of the
other party or parties thereto with the material terms, covenants or provisions
of any material License Agreement.


 


(b)           Each
Borrower and Guarantor will either exercise any option to renew or extend the
term of each Material License Agreement to which it is a party in such manner
as will cause the term of such Material License Agreement to be effectively
renewed or extended for the period provided by such option and give prompt
written notice thereof to Agent or give Agent prior written notice that such
Borrower or Guarantor does not intend to renew or extend the term of any such
Material License Agreement or that the term thereof shall otherwise be
expiring, not less than thirty (30) days prior to the date of any such
non-renewal or expiration. In the event of the failure of such Borrower or
Guarantor to extend or renew any Material License Agreement to which it is a
party, Agent shall have, and is hereby granted, the irrevocable right and
authority, exercisable at its option at any time that an Event of Default shall
have occurred and be 


 


97

















 


continuing, to
renew or extend the term of such Material License Agreement, whether in its own
name and behalf, or in the name and behalf of a designee or nominee of Agent or
in the name and behalf of such Borrower or Guarantor, as Agent shall determine
in good faith. If an Event of Default shall have occurred and be continuing,
Agent may, but shall not be required to, perform any or all of such obligations
of such Borrower or Guarantor under any of the License Agreements, including,
but not limited to, the payment of any or all sums due from such Borrower or
Guarantor thereunder. Any sums so paid by Agent shall constitute part of the
Obligations.


 


9.20        Costs and Expenses. Subject to
the limitations contained in Sections 7.3, 7.4 and 7.7 hereof, Borrowers and
Guarantors shall pay to Agent on demand all costs, expenses, filing fees and
taxes paid or payable in connection with the preparation, negotiation,
execution, delivery, recording, syndication, administration, collection,
liquidation, enforcement and defense of the Obligations, Agent’s rights in the
Collateral, this Agreement, the other Financing Agreements and all other
documents related hereto or thereto, including any amendments, supplements or
consents which may hereafter be contemplated (whether or not executed) or
entered into in respect hereof and thereof, including:  (a) all costs and expenses of filing or
recording (including Uniform Commercial Code financing statement filing taxes
and fees, documentary taxes, intangibles taxes and mortgage recording taxes and
fees, if applicable); (b) costs and expenses and fees for insurance premiums,
environmental audits, title insurance premiums, surveys, assessments,
engineering reports and inspections, appraisal fees (subject to the limitations
contained in Sections 7.3(d) and 7.4(a) hereof) and search fees, costs and
expenses of remitting loan proceeds, collecting checks and other items of
payment, and establishing and maintaining the Blocked Accounts, together with
Agent’s customary charges and fees with respect thereto; (c) charges, fees or
expenses charged by any bank or issuer in connection with the Letter of Credit
Accommodations; (d) costs and expenses of preserving and protecting the
Collateral; (e) costs and expenses paid or incurred in connection with obtaining
payment of the Obligations, enforcing the security interests and liens of
Agent, selling or otherwise realizing upon the Collateral, and otherwise
enforcing the provisions of this Agreement and the other Financing Agreements
or defending any claims made or threatened against Agent or any Lender arising
out of the transactions contemplated hereby and thereby (including preparations
for and consultations concerning any such matters); (f) all out-of-pocket
expenses and costs heretofore and from time to time hereafter incurred by Agent
during the course of periodic field examinations of the Collateral and such
Borrower’s or Guarantor’s operations, plus a per diem charge at Agent’s then
standard rate for Agent’s examiners in the field and office (which rate as of
the date hereof is $850 per person per day); and (g) the fees and disbursements
of counsel (including legal assistants) to Agent in connection with any of the
foregoing.


 


9.21        Further Assurances. (a)  In the case of the formation or acquisition
by a Borrower or Guarantor of any Subsidiary after the date hereof (other than
an Excluded Subsidiary), as to any such Subsidiary, (i) the Borrower or
Guarantor forming such Subsidiary shall cause any such Subsidiary (other than a
Subsidiary organized under the laws of a jurisdiction outside the United
States) to execute and deliver to Agent, the following (each in form and
substance reasonably satisfactory to Agent), (A) an absolute and unconditional
guarantee of payment of the Obligations, (B) a security agreement granting to
Agent a first security interest and lien (except as otherwise consented to in
writing by Agent and subject to the liens permitted under Section 9.8 hereof)
upon all of the assets of any such Subsidiary of the type or category of the
assets of 


 


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Borrowers subject to the security interests and liens pursuant hereto,
and (C) such other agreements, documents and instruments as Agent may
reasonably require in connection with the documents referred to above in order
to make such Subsidiary a party to this Agreement as a “Borrower” or as a “Guarantor”
as Agent may determine, including, but not limited to, supplements and
amendments hereto, authorization to file UCC financing statements, Collateral
Access Agreements and other consents, waivers, acknowledgments and other
agreements from third persons which Agent may deem necessary or desirable in
order to permit, protect and perfect its security interests in and liens upon
the assets purchased, corporate resolutions and other organization and
authorizing documents of such Person, and favorable opinions of counsel to such
person and (ii) the Borrower or Guarantor forming such Subsidiary shall (A)
execute and deliver to Agent, a pledge and security agreement, in form and
substance satisfactory to Agent, granting to Agent a first pledge of and lien
on all of the issued and outstanding shares of Capital Stock of any such
Subsidiary or, in the case of a Subsidiary organized under the laws of a
jurisdiction outside the United States, sixty-five (65%) percent of the issued
and outstanding shares of Capital Stock of such Subsidiary, and (B) deliver the
original stock certificates evidencing such shares of Capital Stock (or such
other evidence as may be issued in the case of a limited liability company),
together with stock powers with respect thereto duly executed in blank (or the
equivalent thereof in the case of a limited liability company in which such
interests are certificated, or otherwise take such actions as Agent shall
require with respect to Agent’s security interests therein).


 


(b)  In the case
of an acquisition of assets (other than Capital Stock) by a Borrower or
Guarantor (including indirectly through a Specified Subsidiary) pursuant to a
Permitted Acquisition after the date hereof, Agent shall have received, in form
and substance reasonably satisfactory to Agent, (i) evidence that Agent has
valid and perfected security interests in and liens upon all purchased assets
of the type or category of assets of Borrowers subject to the security
interests and liens pursuant hereto (except for Excluded Assets, such assets
encumbered by a lien permitted under Section 9.8(e) or (l) hereof and such
assets owned by a Subsidiary organized under the laws of a jurisdiction outside
the United States), and (ii) such other agreements, documents and instruments
as Agent may require in connection with the documents referred to above,
including, but not limited to, supplements and amendments hereto, corporate
resolutions and other organization and authorizing documents and favorable
opinions of counsel to such person.


 


(c)  At the
request of Agent at any time and from time to time, Borrowers and Guarantors
shall, and shall cause each Specified Subsidiary to, at their expense, duly
execute and deliver, or cause to be duly executed and delivered, such further
agreements, documents and instruments, and do or cause to be done such further
acts as may be necessary or proper to evidence, perfect, maintain and enforce
the security interests and the priority thereof in the Collateral and to
otherwise effectuate the provisions or purposes of this Agreement or any of the
other Financing Agreements. Agent may at any time and from time to time request
a certificate from an officer of any Borrower or Guarantor representing that
all conditions precedent to the making of Loans and providing Letter of Credit
Accommodations contained herein are satisfied. In the event of such request by
Agent, Agent and Lenders may, at Agent’s option, cease to make any further
Loans or provide any further Letter of Credit Accommodations until Agent has
received such certificate and, in addition, Agent has determined that such
conditions are satisfied.


 


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(d)  Notwithstanding
the requirements set forth in Sections 5.2 and 9.21(a) and (b) above, Agent
shall not require compliance with the requirements of those sections
contemporaneously upon the formation of a Subsidiary, or the consummation of a
Permitted Acquisition; provided, that, Borrowers and Guarantors and such new
Subsidiaries shall comply therewith within forty-five (45) days of the
occurrence of the formation of such Subsidiary or the consummation of such
Permitted Acquisition (unless Agent extends or waives such compliance either in
whole or in part).


 


9.22         Petro
Existing Letters of Credit . Borrowers and Guarantors shall promptly notify
Agent in writing when all of the Petro Existing Letters of Credit have expired
or been terminated and when the Petro Lien Effective Date has occurred. Borrowers
and Guarantors shall not permit any of the Petro Existing Letters of Credit to
be amended, supplemented, restated, renewed or otherwise modified and shall not
permit the expiry date of any of the Petro Existing Letters of Credit to be
renewed or otherwise extended, in each case without the prior written consent
of Agent.


 


9.23         Petro
Existing Security Agreement . Borrowers and Guarantors shall promptly
notify Agent in writing of the occurrence of the date on which the Petro
Existing Security Agreement or the liens granted thereunder have been
terminated or released (such date being the “Petro Existing Security Agreement
Termination Date”). Borrowers and Guarantors shall not permit the Petro
Existing Security Agreement to be amended, supplemented, restated, renewed or
otherwise modified, without the prior written consent of Agent. Borrowers and
Guarantors shall not permit any Person to become a Secured Trade Creditor (as
defined in the Petro Existing Security Agreement) other than ExxonMobil. After
the Petro Existing Security Agreement Termination Date, Borrower and Guarantors
shall, promptly upon the request of Agent, furnish evidence, in form and
substance reasonably satisfactory to Agent, that all Uniform Commercial Code
financing statements and similar lien registrations filed in connection with
the Petro Existing Security Agreement have been terminated.


 


SECTION 10.    EVENTS
OF DEFAULT AND REMEDIES


 


10.1         Events
of Default. The occurrence or existence of any one or more of the following
events are referred to herein individually as an “Event of Default”, and
collectively as “Events of Default”:


 


(a)           (i)
any Borrower fails to pay any of the Obligations when due or (ii) any Borrower
or Guarantor fails to perform any of the covenants contained in Sections
9.1(b), 9.1(c), 9.3, 9.4, 9.13, 9.14, 9.15, 9.16 and 9.18 of this Agreement and
such failure shall continue for twenty (20) days; provided, that,
such twenty (20) day period shall not apply in the case of: (A) any failure to
observe any such covenant which is not capable of being cured at all or within
such twenty (20) day period or which has been the subject of a prior failure
within a three (3) month period or (B) a willful breach by any Borrower or
Obligor of any such covenant or (iii) any Borrower or Obligor fails to perform
any of the terms, covenants, conditions or provisions contained in this
Agreement or any of the other Financing Agreements other than those described
in Sections 10.1(a)(i) and 10.1(a)(ii) above;


 


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(b)           any
representation, warranty or statement of fact made by any Borrower or Guarantor
to Agent in this Agreement, the other Financing Agreements or any other written
agreement, schedule, confirmatory assignment or document shall when made or
deemed made be false or misleading in any material respect;


 


(c)           any
Obligor revokes or terminates or purports to revoke or terminate or fails to
perform any of the terms, covenants, conditions or provisions of any guarantee,
endorsement or other agreement of such party in favor of Agent or any Lender;


 


(d)           any
one or more judgments for the payment of money is or are rendered against any
Borrower or Obligor in excess of $1,500,000 in the aggregate (to the extent not
covered by insurance where the insurer has assumed responsibility in writing
for such judgment) and shall remain undischarged or unvacated for a period in
excess of thirty (30) days or execution shall at any time not be effectively
stayed, or any judgment other than for the payment of money, or injunction,
attachment, garnishment or execution is rendered against any Borrower or
Obligor or any of the Collateral having a value in excess of $1,500,000 which
is not effectively stayed or bonded;


 


(e)           any
Borrower or Obligor, which is a partnership, limited liability company, limited
liability partnership or a corporation, dissolves or suspends or discontinues
doing business, except as permitted under Section 9.7(c) hereof;


 


(f)            any
Borrower or Obligor makes an assignment for the benefit of creditors, makes or
sends notice of a bulk transfer or calls a meeting of its creditors or
principal creditors in connection with a moratorium or adjustment of the
Indebtedness due to them;


 


(g)           a
case or proceeding under the bankruptcy laws of the United States of America
now or hereafter in effect or under any insolvency, reorganization,
receivership, readjustment of debt, dissolution or liquidation law or statute
of any jurisdiction now or hereafter in effect (whether at law or in equity) is
filed against any Borrower or Obligor or all or any part of its properties and
such petition or application is not dismissed within forty-five (45) days after
the date of its filing or any Borrower or Obligor shall file any answer
admitting or not contesting such petition or application or indicates its
consent to, acquiescence in or approval of, any such action or proceeding or
the relief requested is granted sooner;


 


(h)           a
case or proceeding under the bankruptcy laws of the United States of America now
or hereafter in effect or under any insolvency, reorganization, receivership,
readjustment of debt, dissolution or liquidation law or statute of any
jurisdiction now or hereafter in effect (whether at a law or equity) is filed
by any Borrower or Obligor or for all or any part of its property;


 


(i)            (i)
any default in respect of any Indebtedness of any Borrower or Obligor (other
than Indebtedness owing to Agent and Lenders hereunder), in any case in an
amount in excess of $1,500,000, which default continues for more than the
applicable cure period, if any, with respect thereto, or (ii) any default by
any Borrower or Obligor under any Material Contract, which default continues
for more than the applicable cure period, if any, with respect thereto and/or is
not waived in writing by the other parties thereto, or (iii) any Credit Card
Issuer or Credit Card Processor withholds payment of amounts otherwise payable
to a Borrower or Guarantor to fund a reserve account or otherwise hold as
collateral, or shall require a Borrower 


 


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or Guarantor to
pay funds into a reserve account or for such Credit Card Issuer or Credit Card
Processor to otherwise hold as collateral, or any Borrower or Guarantor shall
provide a letter of credit, guarantee, indemnity or similar instrument to or in
favor of such Credit Card Issuer or Credit Card Processor such that in the
aggregate all of such funds in the reserve account, other amounts held as
collateral and the amount of such letters of credit, guarantees, indemnities or
similar instruments shall exceed $1,500,000 or any such Credit Card Issuer or
Credit Card Processor shall debit or deduct any amounts in excess of $1,500,000
in the aggregate in any fiscal year of Borrowers and Guarantors from any
deposit account of any Borrower or Guarantor;


 


(j)            any
material provision hereof or of any of the other Financing Agreements shall for
any reason cease to be valid, binding and enforceable with respect to any party
hereto or thereto (other than Agent) in accordance with its terms, or any such
party shall challenge the enforceability hereof or thereof, or shall assert in
writing, or take any action or fail to take any action based on the assertion
that any provision hereof or of any of the other Financing Agreements has
ceased to be or is otherwise not valid, binding or enforceable in accordance
with its terms, or any security interest provided for herein or in any of the
other Financing Agreements shall cease to be a valid and perfected first priority
security interest in any of the Collateral purported to be subject thereto
(except as otherwise permitted herein or therein);


 


(k)           an
ERISA Event shall occur which results in or could reasonably be expected to
result in liability of any Borrower in an aggregate amount in excess of
$1,500,000;


 


(l)            any
Change of Control;


 


(m)          the
indictment by any Governmental Authority, or the threatened indictment in
writing by any Governmental Authority of any Borrower or Obligor of which any
Borrower, Obligor or Agent receives notice, in either case, as to which there
is a reasonable probability of an adverse determination under any criminal
statute, or commencement or threatened commencement of criminal or civil
proceedings against such Borrower or Obligor, pursuant to which statute or
proceedings the penalties or remedies sought or available include forfeiture of
(i) any of the Collateral having a value in excess of $1,500,000 or (ii) any
other property of any Borrower or Guarantor which is necessary or material to
the conduct of its business; or


 


(n)           there
shall be an event of default under any of the other Financing Agreements.


 


10.2    Remedies.


 


(a)           At
any time an Event of Default has occurred and is continuing, Agent and Lenders
shall have all rights and remedies provided in this Agreement, the other
Financing Agreements, the UCC and other applicable law, all of which rights and
remedies may be exercised without notice to or consent by any Borrower or
Obligor, except as such notice or consent is expressly provided for hereunder
or required by applicable law. All rights, remedies and powers granted to Agent
and Lenders hereunder, under any of the other Financing Agreements, the UCC or
other applicable law, are cumulative, not exclusive and enforceable, in Agent’s
discretion, alternatively, successively, or concurrently on any one or more
occasions, and shall include, without limitation, the right to apply to a court
of equity for an injunction to restrain a breach or threatened breach by any
Borrower or Obligor of this Agreement or any of 


 


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the other
Financing Agreements. Subject to Section 12 hereof, Agent may, and at the
direction of the Required Lenders shall, at any time or times, proceed directly
against any Borrower or Obligor to collect the Obligations without prior
recourse to the Collateral.


 


(b)           Without
limiting the generality of the foregoing, at any time an Event of Default has
occurred and is continuing, Agent may, at its option and shall upon the direction
of the Required Lenders, (i) upon notice to Administrative Borrower, accelerate
the payment of all Obligations and demand immediate payment thereof to Agent
for itself and the benefit of Lenders (provided, that, upon the
occurrence of any Event of Default described in Sections 10.1(g) and 10.1(h),
all Obligations shall automatically become immediately due and payable), and
(ii) terminate the Commitments and this Agreement (provided, that,
upon the occurrence of any Event of Default described in Sections 10.1(g) and
10.1(h), the Commitments and any other obligation of the Agent or a Lender
hereunder shall automatically terminate).


 


(c)           Without
limiting the foregoing, at any time an Event of Default has occurred and is
continuing, Agent may, in its discretion (i) with or without judicial process
or the aid or assistance of others, enter upon any premises on or in which any
of the Collateral may be located and take possession of the Collateral or
complete processing, manufacturing and repair of all or any portion of the
Collateral, (ii) require any Borrower or Obligor, at Borrowers’ expense, to
assemble and make available to Agent any part or all of the Collateral at any
place and time designated by Agent, (iii) collect, foreclose, receive,
appropriate, setoff and realize upon any and all Collateral, (iv) remove any or
all of the Collateral from any premises on or in which the same may be located
for the purpose of effecting the sale, foreclosure or other disposition thereof
or for any other purpose, (v) sell, lease, transfer, assign, deliver or
otherwise dispose of any and all Collateral (including entering into contracts
with respect thereto, public or private sales at any exchange, broker’s board,
at any office of Agent or elsewhere) at such prices or terms as Agent may deem
reasonable, for cash, upon credit or for future delivery, with the Agent having
the right to purchase the whole or any part of the Collateral at any such
public sale, all of the foregoing being free from any right or equity of
redemption of any Borrower or Obligor, which right or equity of redemption is
hereby expressly waived and released by Borrowers and Obligors and/or (vi)
terminate this Agreement. If any of the Collateral is sold or leased by Agent
upon credit terms or for future delivery, the Obligations shall not be reduced
as a result thereof until payment therefor is finally collected by Agent. If
notice of disposition of Collateral is required by law, ten (10) days prior
notice by Agent to Administrative Borrower designating the time and place of
any public sale or the time after which any private sale or other intended
disposition of Collateral is to be made, shall be deemed to be reasonable
notice thereof and Borrowers and Obligors waive any other notice. In the event
Agent institutes an action to recover any Collateral or seeks recovery of any
Collateral by way of prejudgment remedy, each Borrower and Obligor waives the
posting of any bond which might otherwise be required. At any time an Event of
Default has occurred and is continuing, upon Agent’s request, Borrowers will
either, as Agent shall specify, furnish cash collateral to the issuer to be
used to secure and fund Agent’s reimbursement obligations to the issuer in
connection with any Letter of Credit Accommodations or furnish cash collateral
to Agent for the Letter of Credit Accommodations. Such cash collateral shall be
in the amount equal to one hundred two (102%) percent of the amount of the
Letter of Credit Accommodations plus the amount of any fees and expenses
payable in connection therewith through the end of the latest expiration date
of such Letter of Credit Accommodations.


 


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(d)           At
any time or times that an Event of Default has occurred and is continuing,
Agent may, in its discretion, enforce the rights of any Borrower or Obligor
against any account debtor, secondary obligor or other obligor in respect of
any of the Accounts or other Receivables. Without limiting the generality of
the foregoing, Agent may, in its discretion, at such time or times (i) notify
any or all account debtors (including Credit Card Issuers and Credit Card
Processors), secondary obligors or other obligors in respect thereof that the
Receivables have been assigned to Agent and that Agent has a security interest
therein and Agent may direct any or all accounts debtors (including Credit Card
and Credit Card Processors), secondary obligors and other obligors to make
payment of Receivables directly to Agent, (ii) extend the time of payment of,
compromise, settle or adjust for cash, credit, return of merchandise or
otherwise, and upon any terms or conditions, any and all Receivables or other
obligations included in the Collateral and thereby discharge or release the
account debtor or any secondary obligors or other obligors in respect thereof
without affecting any of the Obligations, (iii) demand, collect or enforce
payment of any Receivables or such other obligations, but without any duty to
do so, and Agent and Lenders shall not be liable for any failure to collect or
enforce the payment thereof nor for the negligence of its agents or attorneys
with respect thereto and (iv) take whatever other action Agent may deem
necessary or desirable for the protection of its interests and the interests of
Lenders. At any time that an Event of Default has occurred and is continuing,
at Agent ‘s request, all invoices and statements sent to any account debtor
shall state that the Accounts and such other obligations have been assigned to
Agent and are payable directly and only to Agent and Borrowers and Obligors
shall deliver to Agent such originals of documents evidencing the sale and
delivery of goods or the performance of services giving rise to any Accounts as
Agent may require. In the event any account debtor returns Inventory when an
Event of Default has occurred and is continuing, Borrowers shall, upon Agent’s
request, hold the returned Inventory in trust for Agent, segregate all returned
Inventory from all of its other property, dispose of the returned Inventory
solely according to Agent’s instructions, and not issue any credits, discounts
or allowances with respect thereto without Agent’s prior written consent.


 


(e)           To
the extent that applicable law imposes duties on Agent or any Lender to
exercise remedies in a commercially reasonable manner (which duties cannot be
waived under such law), each Borrower and Guarantor acknowledges and agrees
that it is not commercially unreasonable for Agent or any Lender (i) to fail to
incur expenses reasonably deemed significant by Agent or any Lender to prepare
Collateral for disposition or otherwise to complete raw material or work in
process into finished goods or other finished products for disposition, (ii) to
fail to obtain third party consents for access to Collateral to be disposed of,
or to obtain or, if not required by other law, to fail to obtain consents of
any Governmental Authority or other third party for the collection or
disposition of Collateral to be collected or disposed of, (iii) to fail to
exercise collection remedies against account debtors, secondary obligors or
other persons obligated on Collateral or to remove liens or encumbrances on or
any adverse claims against Collateral, (iv) to exercise collection remedies
against account debtors and other persons obligated on Collateral directly or
through the use of collection agencies and other collection specialists, (v) to
advertise dispositions of Collateral through publications or media of general
circulation, whether or not the Collateral is of a specialized nature, (vi) to
contact other persons, whether or not in the same business as any Borrower or
Guarantor, for expressions of interest in acquiring all or any portion of the
Collateral, (vii) to hire one or more professional auctioneers to assist in the
disposition of Collateral, whether or not the collateral is of a specialized
nature, (viii) to dispose of Collateral by utilizing Internet sites that
provide for the auction of assets of the types included in the Collateral or
that have the reasonable capability of doing so, or that match 


 


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buyers and sellers
of assets, (ix) to dispose of assets in wholesale rather than retail markets,
(x) to disclaim disposition warranties, (xi) to purchase insurance or credit
enhancements to insure Agent or Lenders against risks of loss, collection or
disposition of Collateral or to provide to Agent or Lenders a guaranteed return
from the collection or disposition of Collateral, or (xii) to the extent deemed
appropriate by Agent, to obtain the services of other brokers, investment
bankers, consultants and other professionals to assist Agent in the collection
or disposition of any of the Collateral. Each Borrower and Guarantor
acknowledges that the purpose of this Section is to provide non-exhaustive
indications of what actions or omissions by Agent or any Lender would not be
commercially unreasonable in the exercise by Agent or any Lender of remedies
against the Collateral and that other actions or omissions by Agent or any Lender
shall not be deemed commercially unreasonable solely on account of not being
indicated in this Section. Without limitation of the foregoing, nothing
contained in this Section shall be construed to grant any rights to any
Borrower or Guarantor or to impose any duties on Agent or Lenders that would
not have been granted or imposed by this Agreement or by applicable law in the
absence of this Section.


 


(f)            For
the purpose of enabling Agent to exercise the rights and remedies hereunder,
each Borrower and Obligor hereby grants to Agent, to the extent assignable, an
irrevocable, non-exclusive license (exercisable at any time an Event of Default
shall exist or have occurred and for so long as the same is continuing) without
payment of royalty or other compensation to any Borrower or Obligor, to use,
assign, license or sublicense any of the trademarks, service-marks, trade
names, business names, trade styles, designs, logos and other source of
business identifiers and other Intellectual Property and general intangibles
now owned or hereafter acquired by any Borrower or Obligor, wherever the same
maybe located, including in such license reasonable access to all media in
which any of the licensed items may be recorded or stored and to all computer
programs used for the compilation or printout thereof.


 


(g)           At
any time an Event of Default has occurred and is continuing, Agent may apply
the cash proceeds of Collateral actually received by Agent from any sale,
lease, foreclosure or other disposition of the Collateral to payment of the
Obligations, in whole or in part and in accordance with the terms hereof,
whether or not then due or may hold such proceeds as cash collateral for the
Obligations. Borrowers and Guarantors shall remain liable to Agent and Lenders
for the payment of any deficiency with interest at the highest rate provided
for herein and all costs and expenses of collection or enforcement, including
attorneys’ fees and expenses.


 


(h)           Without
limiting the foregoing, upon the occurrence and during the continuance of a
Default or an Event of Default, (i) Agent and Lenders may, at Agent’s option,
and upon the occurrence of an Event of Default at the direction of the Required
Lenders, Agent and Lenders shall, without notice, (A) cease making Loans or
arranging for Letter of Credit Accommodations or reduce the lending formulas or
amounts of Loans and Letter of Credit Accommodations available to Borrowers
and/or (B) terminate any provision of this Agreement providing for any future
Loans or Letter of Credit Accommodations to be made by Agent and Lenders to
Borrowers and (ii) Agent may, at its option, establish such Reserves as Agent
determines, without limitation or restriction, notwithstanding anything to the
contrary contained herein.


 


SECTION 11.                          JURY
TRIAL WAIVER; OTHER WAIVERS AND CONSENTS; GOVERNING LAW


 


105

















 


11.1         Governing
Law; Choice of Forum; Service of Process; Jury Trial Waiver.


 


(a)           The
validity, interpretation and enforcement of this Agreement and the other Financing
Agreements (except as otherwise provided therein) and any dispute arising out
of the relationship between the parties hereto, whether in contract, tort,
equity or otherwise, shall be governed by the internal laws of the State of New
York but excluding any principles of conflicts of law or other rule of law that
would cause the application of the law of any jurisdiction other than the laws
of the State of New York.


 


(b)           Borrowers,
Guarantors, Agent and Lenders irrevocably consent and submit to the non-exclusive
jurisdiction of the Supreme Court of the State of New York, New York County in
the Borough of Manhattan and United States District Court for the Southern
District of New York, whichever Agent may elect, and waive any objection based
on venue or forum  non  conveniens with respect to any
action instituted therein arising under this Agreement or any of the other
Financing Agreements or in any way connected with or related or incidental to
the dealings of the parties hereto in respect of this Agreement or any of the
other Financing Agreements or the transactions related hereto or thereto, in
each case whether now existing or hereafter arising, and whether in contract,
tort, equity or otherwise, and agree that any dispute with respect to any such
matters shall be heard only in the courts described above (except that Agent
and Lenders shall have the right to bring any action or proceeding against any
Borrower or Guarantor or its or their property in the courts of any other
jurisdiction which Agent deems necessary or appropriate in order to realize on
the Collateral or to otherwise enforce its rights against any Borrower or
Guarantor or its or their property).


 


(c)           Each
Borrower and Guarantor hereby waives personal service of any and all process
upon it and consents that all such service of process may be made by certified
mail (return receipt requested) directed to its address set forth herein and
service so made shall be deemed to be completed five (5) days after the same
shall have been so deposited in the U.S. mails, or, at Agent’s option, by
service upon any Borrower or Guarantor (or Administrative Borrower on behalf of
such Borrower or Guarantor) in any other manner provided under the rules of any
such courts. Within thirty (30) days after such service, such Borrower or
Guarantor shall appear in answer to such process, failing which such Borrower
or Guarantor shall be deemed in default and judgment may be entered by Agent
against such Borrower or Guarantor for the amount of the claim and other relief
requested.


 


(d)           BORROWERS,
GUARANTORS, AGENT AND LENDERS EACH HEREBY WAIVES ANY RIGHT TO TRIAL BY JURY OF
ANY CLAIM, DEMAND, ACTION OR CAUSE OF ACTION ARISING UNDER THIS AGREEMENT OR
ANY OF THE OTHER FINANCING AGREEMENTS OR IN ANY WAY CONNECTED WITH OR RELATED
OR INCIDENTAL TO THE DEALINGS OF THE PARTIES HERETO IN RESPECT OF THIS
AGREEMENT OR ANY OF THE OTHER FINANCING AGREEMENTS OR THE TRANSACTIONS RELATED
HERETO OR THERETO IN EACH CASE WHETHER NOW EXISTING OR HEREAFTER ARISING, AND
WHETHER IN CONTRACT, TORT, EQUITY OR OTHERWISE. BORROWERS, GUARANTORS, AGENT
AND LENDERS EACH HEREBY AGREES AND CONSENTS THAT ANY SUCH CLAIM, DEMAND, ACTION
OR CAUSE OF ACTION SHALL BE DECIDED BY COURT TRIAL WITHOUT A JURY AND THAT ANY
BORROWER, ANY GUARANTOR, AGENT OR ANY LENDER MAY FILE AN ORIGINAL COUNTERPART
OR A COPY OF THIS 


 


106

















 


AGREEMENT WITH ANY
COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE PARTIES HERETO TO THE WAIVER OF
THEIR RIGHT TO TRIAL BY JURY.


 


(e)           Agent
and Lenders shall not have any liability to any Borrower or Guarantor (whether
in tort, contract, equity or otherwise) for losses suffered by such Borrower or
Guarantor in connection with, arising out of, or in any way related to the
transactions or relationships contemplated by this Agreement, or any act,
omission or event occurring in connection herewith, unless it is determined by
a final and non-appealable judgment or court order binding on Agent and such
Lender, that the losses were the result of acts or omissions constituting gross
negligence or willful misconduct. In any such litigation, Agent and Lenders
shall be entitled to the benefit of the rebuttable presumption that it acted in
good faith and with the exercise of ordinary care in the performance by it of the
terms of this Agreement. Each Borrower and Guarantor: (i) certifies that
neither Agent, any Lender nor any representative, agent or attorney acting for
or on behalf of Agent or any Lender has represented, expressly or otherwise,
that Agent and Lenders would not, in the event of litigation, seek to enforce
any of the waivers provided for in this Agreement or any of the other Financing
Agreements and (ii) acknowledges that in entering into this Agreement and the
other Financing Agreements, Agent and Lenders are relying upon, among other
things, the waivers and certifications set forth in this Section 11.1 and
elsewhere herein and therein.


 


11.2    Waiver of Notices . Each Borrower and
Guarantor hereby expressly waives demand, presentment, protest and notice of
protest and notice of dishonor with respect to any and all instruments and
chattel paper, included in or evidencing any of the Obligations or the
Collateral, and any and all other demands and notices of any kind or nature
whatsoever with respect to the Obligations, the Collateral and this Agreement,
except such as are expressly provided for herein. No notice to or demand on any
Borrower or Guarantor which Agent or any Lender may elect to give shall entitle
such Borrower or Guarantor to any other or further notice or demand in the
same, similar or other circumstances.


 


11.3    Amendments and Waivers. 


 


(a)           Neither
this Agreement nor any other Financing Agreement nor any terms hereof or
thereof may be amended, waived, discharged or terminated unless such amendment,
waiver, discharge or termination is in writing signed by Agent and the Required
Lenders or at Agent’s option, by Agent with the authorization of the Required
Lenders, and as to amendments to any of the Financing Agreements (other than
with respect to any provision of Section 12 hereof), by any Borrower; except,
that, no such amendment, waiver, discharge or termination shall:


 


(i)            reduce
the interest rate or any fees or extend the time of payment of principal,
interest or any fees or reduce the principal amount of any Loan or Letter of
Credit Accommodations, in each case without the consent of each Lender directly
affected thereby,


 


(i)            increase
the Commitment of any Lender over the amount thereof then in effect or provided
hereunder, in each case without the consent of the Lender directly affected
thereby,


 


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(ii)           release
any Collateral (except as expressly required hereunder or under any of the
other Financing Agreements or applicable law and except as permitted under
Section 12.11(b) hereof), without the consent of Agent and all of Lenders,


 


(iii)          reduce
any percentage specified in the definition of Required Lenders, without the
consent of Agent and all of Lenders,


 


(iv)          consent
to the assignment or transfer by any Borrower or Guarantor of any of their
rights and obligations under this Agreement, without the consent of Agent and
all of Lenders,


 


(v)           amend,
modify or waive any terms of this Section 11.3 or Section 6.4 hereof, without
the consent of Agent and all of Lenders, or


 


(vi)          (A)
increase the advance rates constituting part of the Borrowing Base or increase
the sublimits with respect to the Inventory Loan Limit, the Fuel Inventory Loan
Limit, the Fixed Asset Availability Limit, Revolving Loans based on Eligible
Inventory or Perishable Inventory or for Letter of Credit Accommodations,
without the consent of Agent and all of Lenders or (B) amend, modify or waive
any provisions of the definition of the term Borrowing Base or any of the
defined terms referred to in the definition of the term Borrowing Base, in each
case if the effect thereof increases the amount of the Borrowing Base, without
the consent of Agent and all of Lenders.


 


(b)           Agent
and Lenders shall not, by any act, delay, omission or otherwise be deemed to
have expressly or impliedly waived any of its or their rights, powers and/or
remedies unless such waiver shall be in writing and signed as provided herein. Any
such waiver shall be enforceable only to the extent specifically set forth
therein. A waiver by Agent or any Lender of any right, power and/or remedy on
any one occasion shall not be construed as a bar to or waiver of any such
right, power and/or remedy which Agent or any Lender would otherwise have on
any future occasion, whether similar in kind or otherwise.


 


(c)           Notwithstanding
anything to the contrary contained in Section 11.3(a) above, in connection with
any amendment, waiver, discharge or termination, in the event that any Lender
whose consent thereto is required shall fail to consent or fail to consent in a
timely manner (such Lender being referred to herein as a “Non-Consenting Lender”),
but the consent of any other Lenders to such amendment, waiver, discharge or
termination that is required are obtained, if any, then Wachovia or, with the
prior written consent of Agent, Administrative Borrower, shall have the right,
but not the obligation, at any time thereafter, and upon the exercise by
Wachovia or, with the prior written consent of Agent, Administrative Borrower
of such right, such Non-Consenting Lender shall have the obligation, to sell,
assign and transfer to Wachovia or such Eligible Transferee as Wachovia or,
with the prior written consent of Agent, Administrative Borrower may specify,
the Commitment of such Non-Consenting Lender and all rights and interests of
such Non-Consenting Lender pursuant thereto. Wachovia or, with the prior
written consent of Agent, Administrative Borrower shall provide the
Non-Consenting Lender with prior written notice of its intent to exercise its
right under this Section, which notice shall specify on date on which such
purchase and sale shall occur. Such purchase and sale shall be pursuant to the
terms of an Assignment and Acceptance (whether or not executed by the
Non-Consenting Lender), except that on the date of such purchase and sale,
Wachovia, or such Eligible Transferee specified by Wachovia or, with the prior
written consent of Agent, 


 


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Administrative
Borrower, shall pay to the Non-Consenting Lender (except as Wachovia and such
Non-Consenting Lender may otherwise agree) the amount equal to: (i) the
principal balance of the Loans held by the Non-Consenting Lender outstanding as
for the close of business on the business day immediately preceding the
effective date of such purchase and sale, plus (ii) amounts accrued and unpaid
in respect of interest and fees payable to the Non-Consenting Lender to the
effective date of the purchase (but in no event shall the Non-Consenting Lender
be deemed entitled to any early termination fee). Such purchase and sale shall
be effective on the date of the payment of such amount to the Non-Consenting
Lender and the Commitment of the Non-Consenting Lender shall terminate on such
date.


 


(d)           The
consent of Agent shall be required for any amendment, waiver or consent
affecting the rights or duties of Agent hereunder or under any of the other
Financing Agreements, in addition to the consent of the Lenders otherwise
required by this Section and the exercise by Agent of any of its rights
hereunder with respect to Reserves or Eligible Accounts or Eligible Inventory
shall not be deemed an amendment to the advance rates provided for in this
Section 11.3.


 


(e)           The
consent of Agent and any Bank Product Provider that is providing Bank Products
and has outstanding any such Bank Products at such time that are secured
hereunder shall be required for any amendment to the priority of payment of
Obligations arising under or pursuant to any Hedge Agreements of a Borrower or
Guarantor or other Bank Products as set forth in Section 6.4(a) hereof.


 


11.4         Waiver
of Counterclaims. Each Borrower and Guarantor waives all rights to
interpose any claims, deductions, setoffs or counterclaims of any nature (other
then compulsory counterclaims) in any action or proceeding with respect to this
Agreement, the Obligations, the Collateral or any matter arising therefrom or
relating hereto or thereto.


 


11.5         Indemnification.
Each Borrower and Guarantor shall, jointly and severally, indemnify and hold
Agent and each Lender, and its officers, directors, agents, employees, advisors
and counsel and their respective Affiliates (each such person being an “Indemnitee”),
harmless from and against any and all losses, claims, damages, liabilities,
costs or expenses (including attorneys’ fees and expenses) imposed on, incurred
by or asserted against any of them in connection with any litigation,
investigation, claim or proceeding commenced or threatened related to the
negotiation, preparation, execution, delivery, enforcement, performance or
administration of this Agreement, any other Financing Agreements, or any
undertaking or proceeding related to any of the transactions contemplated
hereby or any act, omission, event or transaction related or attendant thereto,
including amounts paid in settlement, court costs, and the fees and expenses of
counsel except that Borrowers and Guarantors shall not have any obligation
under this Section 11.5 to indemnify an Indemnitee with respect to a matter
covered hereby resulting from the gross negligence or willful misconduct of
such Indemnitee as determined pursuant to a final, non-appealable order of a
court of competent jurisdiction (but without limiting the obligations of
Borrowers or Guarantors as to any other Indemnitee). To the extent that the
undertaking to indemnify, pay and hold harmless set forth in this Section may
be unenforceable because it violates any law or public policy, Borrowers and
Guarantors shall pay the maximum portion which it is permitted to pay under
applicable law to Agent and Lenders in satisfaction of indemnified matters
under this Section. To the extent permitted by applicable law, no Borrower or
Guarantor shall assert, and each Borrower and Guarantor hereby waives, any
claim against any Indemnitee, on any theory of liability, for special,
indirect, consequential 


 


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or punitive damages (as opposed to direct or actual damages) arising
out of, in connection with, or as a result of, this Agreement, any of the other
Financing Agreements or any undertaking or transaction contemplated hereby. All
amounts due under this Section shall be payable upon demand. The foregoing
indemnity shall survive the payment of the Obligations and the termination or
non-renewal of this Agreement.


 


SECTION 12.         THE AGENT


 


12.1         Appointment,
Powers and Immunities. Each Secured Party irrevocably designates, appoints
and authorizes Wachovia to act as Agent hereunder and under the other Financing
Agreements with such powers as are specifically delegated to Agent by the terms
of this Agreement and of the other Financing Agreements, together with such
other powers as are reasonably incidental thereto. Agent (a) shall have no
duties or responsibilities except those expressly set forth in this Agreement
and in the other Financing Agreements, and shall not by reason of this
Agreement or any other Financing Agreement be a trustee or fiduciary for any
Secured Party; (b) shall not be responsible to Lenders for any recitals,
statements, representations or warranties contained in this Agreement or in any
of the other Financing Agreements, or in any certificate or other document
referred to or provided for in, or received by any of them under, this
Agreement or any other Financing Agreement, or for the value, validity,
effectiveness, genuineness, enforceability or sufficiency of this Agreement or
any other Financing Agreement or any other document referred to or provided for
herein or therein or for any failure by any Borrower or any Obligor or any other
Person to perform any of its obligations hereunder or thereunder; and (c) shall
not be responsible to Lenders for any action taken or omitted to be taken by it
hereunder or under any other Financing Agreement or under any other document or
instrument referred to or provided for herein or therein or in connection
herewith or therewith, except for its own gross negligence or willful
misconduct as determined by a final non-appealable judgment of a court of
competent jurisdiction. Agent may employ agents and attorneys-in-fact and shall
not be responsible for the negligence or misconduct of any such agents or
attorneys-in-fact selected by it in good faith. Agent may deem and treat the
payee of any note as the holder thereof for all purposes hereof unless and until
the assignment thereof pursuant to an agreement (if and to the extent permitted
herein) in form and substance reasonably satisfactory to Agent shall have been
delivered to and acknowledged by Agent. Wachovia Capital Markets LLC is hereby
designated as the sole lead arranger, manager and bookrunner with respect to
the Credit Facility. The designation of Wachovia Capital Markets LLC as sole
lead arranger, manager and bookrunner shall not create any rights in favor of
it in such capacity nor subject it to any duties or obligations in such
capacity.


 


12.2         Reliance
by Agent. Agent shall be entitled to rely upon any certification, notice or
other communication (including any thereof by telephone, telecopy, telex,
telegram or cable) believed by it to be genuine and correct and to have been
signed or sent by or on behalf of the proper Person or Persons, and upon advice
and statements of legal counsel, independent accountants and other experts
selected by Agent. As to any matters not expressly provided for by this Agreement
or any other Financing Agreement, Agent shall in all cases be fully protected
in acting, or in refraining from acting, hereunder or thereunder in accordance
with instructions given by the Required Lenders or all of Lenders as is
required in such circumstance, and such instructions of such Agents and any
action taken or failure to act pursuant thereto shall be binding on all
Lenders.


 


12.3    Events of Default.


 


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(a)           Agent
shall not be deemed to have knowledge or notice of the occurrence of a Default
or an Event of Default or other failure of a condition precedent to the Loans
and Letter of Credit Accommodations hereunder, unless and until Agent has
received written notice from a Lender, or a Borrower specifying such Event of
Default or any unfulfilled condition precedent, and stating that such notice is
a “Notice of Default or Failure of Condition”. In the event that Agent receives
such a Notice of Default or Failure of Condition, Agent shall give prompt
notice thereof to the Lenders. Agent shall (subject to Section 12.7) take such
action with respect to any such Event of Default or failure of condition
precedent as shall be directed by the Required Lenders to the extent provided
for herein; provided, that, unless and until Agent shall have
received such directions, Agent may (but shall not be obligated to) take such
action, or refrain from taking such action, with respect to or by reason of
such Event of Default or failure of condition precedent, as it shall deem
advisable in the best interest of Lenders. Without limiting the foregoing, and
notwithstanding the existence or occurrence and continuance of an Event of
Default or any other failure to satisfy any of the conditions precedent set
forth in Section 4 of this Agreement to the contrary, unless and until
otherwise directed by the Required Lenders, Agent may, but shall have no
obligation to, continue to make Loans and issue or cause to be issued Letter of
Credit Accommodations for the ratable account and risk of Lenders from time to
time if Agent believes making such Loans or issuing or causing to be issued
such Letter of Credit Accommodations is in the best interests of Lenders.


 


(b)           Except
with the prior written consent of Agent, no Lender may assert or exercise any
enforcement right or remedy in respect of the Loans, Letter of Credit
Accommodations or other Obligations, as against any Borrower or Obligor or any
of the Collateral or other property of any Borrower or Obligor.


 


12.4    Wachovia in its Individual Capacity. With
respect to its Commitment and the Loans made and Letter of Credit
Accommodations issued or caused to be issued by it (and any successor acting as
Agent), so long as Wachovia shall be a Lender hereunder, it shall have the same
rights and powers hereunder as any other Lender and may exercise the same as
though it were not acting as Agent, and the term “Lender” or “Lenders” shall,
unless the context otherwise indicates, include Wachovia in its individual
capacity as Lender hereunder. Wachovia (and any successor acting as Agent) and
its Affiliates may (without having to account therefor to any Lender) lend
money to, make investments in and generally engage in any kind of business with
Borrowers (and any of its Subsidiaries or Affiliates) as if it were not acting
as Agent, and Wachovia and its Affiliates may accept fees and other
consideration from any Borrower or Guarantor and any of its Subsidiaries and
Affiliates for services in connection with this Agreement or otherwise without
having to account for the same to Lenders.


 


12.5    Indemnification. Lenders agree to
indemnify Agent (to the extent not reimbursed by Borrowers hereunder and
without limiting any obligations of Borrowers hereunder) ratably, in accordance
with their Pro Rata Shares, for any and all claims of any kind and nature
whatsoever that may be imposed on, incurred by or asserted against Agent
(including by any Lender) arising out of or by reason of any investigation in
or in any way relating to or arising out of this Agreement or any other
Financing Agreement or any other documents contemplated by or referred to
herein or therein or the transactions contemplated hereby or thereby (including
the costs and expenses that Agent is obligated to pay hereunder) or the
enforcement of any of the terms hereof or thereof or of any such other
documents, provided, that, no Lender shall be liable for any of
the foregoing to the extent it arises from the gross negligence or willful
misconduct of 


 


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the party to be indemnified as determined by a final non-appealable
judgment of a court of competent jurisdiction. The foregoing indemnity shall
survive the payment of the Obligations and the termination or non-renewal of
this Agreement.


 


12.6         Non-Reliance
on Agent and Other Lenders. Each Lender agrees that it has, independently
and without reliance on Agent or other Lender, and based on such documents and
information as it has deemed appropriate, made its own credit analysis of
Borrowers and Obligors and has made its own decision to enter into this
Agreement and that it will, independently and without reliance upon Agent or
any other Lender, and based on such documents and information as it shall deem
appropriate at the time, continue to make its own analysis and decisions in
taking or not taking action under this Agreement or any of the other Financing
Agreements. Agent shall not be required to keep itself informed as to the
performance or observance by any Borrower or Obligor of any term or provision of
this Agreement or any of the other Financing Agreements or any other document
referred to or provided for herein or therein or to inspect the properties or
books of any Borrower or Obligor. Agent will use reasonable efforts to provide
Lenders with any information received by Agent from any Borrower or Obligor
which is required to be provided to Lenders or deemed to be requested by
Lenders hereunder and with a copy of any Notice of Default or Failure of
Condition received by Agent from any Borrower or any Lender; provided, that,
Agent shall not be liable to any Lender for any failure to do so, except to the
extent that such failure is attributable to Agent’s own gross negligence or
willful misconduct as determined by a final non-appealable judgment of a court
of competent jurisdiction. Except for notices, reports and other documents
expressly required to be furnished to Lenders by Agent or deemed requested by
Lenders hereunder, Agent shall not have any duty or responsibility to provide
any Lender with any other credit or other information concerning the affairs,
financial condition or business of any Borrower or Obligor that may come into
the possession of Agent.


 


12.7         Failure
to Act. Except for action expressly required of Agent hereunder and under
the other Financing- Agreements, Agent shall in all cases be fully justified in
failing or refusing to act hereunder and thereunder unless it shall receive
further assurances to its satisfaction from Lenders of their indemnification
obligations under Section 12.5 hereof against any and all liability and
expense that may be incurred by it by reason of taking or continuing to take
any such action.


 


12.8         Additional
Loans. Agent shall not make any Revolving Loans or provide any Letter of
Credit Accommodations to any Borrower on behalf of Lenders intentionally and
with actual knowledge that such Revolving Loans or Letter of Credit
Accommodations would cause the aggregate amount of the total outstanding
Revolving Loans and Letter of Credit Accommodations to such Borrower to exceed
the Borrowing Base of such Borrower, without the prior consent of all Lenders, except,
that, Agent may make such additional Revolving Loans or provide such
additional Letter of Credit Accommodations on behalf of Lenders, intentionally
and with actual knowledge that such Revolving Loans or Letter of Credit
Accommodations will cause the total outstanding Revolving Loans and Letter of
Credit Accommodations to such Borrower to exceed the Borrowing Base of such
Borrower, as Agent may deem necessary or advisable in its discretion, provided,
that: (a) the total principal amount of the additional Revolving Loans
or additional Letter of Credit Accommodations to any Borrower which Agent may
make or provide after obtaining such actual knowledge that the aggregate
principal amount of the Revolving Loans equal or exceed the Borrowing Bases of
Borrowers, plus the amount of 


 


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Special Agent Advances made pursuant to Section 12.11(a)(i) or (ii)
hereof then outstanding, shall not exceed the aggregate amount equal to ten
(10%) percent of the Maximum Credit, (b) no such additional Revolving Loan or
Letter of Credit Accommodation shall be outstanding more than ninety (90) days
after the date such additional Revolving Loan or Letter of Credit Accommodation
is made or issued (as the case may be), except as the Required Lenders may
otherwise agree and (c) the total outstanding principal amount of Loans, Letter
of Credit Accommodations and Special Agent Advances made pursuant to Section
12.11(a)(i) and (ii) hereof shall not exceed the Maximum Credit. Each Lender
shall be obligated to pay Agent the amount of its Pro Rata Share of any such
additional Revolving Loans or Letter of Credit Accommodations.


 


12.9         Concerning
the Collateral and the Related Financing Agreements. Each Lender authorizes
and directs Agent to enter into this Agreement and the other Financing
Agreements. Each Lender agrees that any action taken by Agent or Required
Lenders in accordance with the terms of this Agreement or the other Financing
Agreements and the exercise by Agent or Required Lenders of their respective
powers set forth therein or herein, together with such other powers that are
reasonably incidental thereto, shall be binding upon all of the Lenders.


 


12.10       Field
Audit, Examination Reports and other Information; Disclaimer by Lenders. By
signing this Agreement, each Lender:


 


(a)           is
deemed to have requested that Agent furnish such Lender, promptly after it
becomes available, a copy of each field audit or examination report and report
with respect to the Borrowing Base prepared or received by Agent (each field
audit or examination report and report with respect to the Borrowing Base being
referred to herein as a “Report” and collectively, “Reports”), appraisals with
respect to the Collateral and financial statements with respect to Parent and
its Subsidiaries received by Agent;


 


(b)           expressly
agrees and acknowledges that Agent (i) does not make any representation or
warranty as to the accuracy of any Report, appraisal or financial statement or
(ii) shall not be liable for any information contained in any Report,
appraisal or financial statement;


 


(c)           expressly
agrees and acknowledges that the Reports are not comprehensive audits or
examinations, that Agent or any other party performing any audit or examination
will inspect only specific information regarding Borrowers and Guarantors and
will rely significantly upon Borrowers’ and Guarantors’ books and records, as
well as on representations of Borrowers’ and Guarantors’ personnel; and


 


(d)           agrees
to keep all Reports confidential and strictly for its internal use in
accordance with the terms of Section 13.5 hereof, and not to distribute or use
any Report in any other manner.


 


12.11       Collateral
Matters.


 


(a)           Agent
may, at its option, from time to time, at any time on or after an Event of
Default and for so long as the same is continuing or upon any other failure of
a condition precedent to the Loans and Letter of Credit Accommodations
hereunder, make such disbursements and advances (“Special Agent Advances”)
which Agent, in its sole discretion, (i) 


 


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deems necessary or
desirable either to preserve or protect the Collateral or any portion thereof
or (ii) to enhance the likelihood or maximize the amount of repayment by
Borrowers and Guarantors of the Loans and other Obligations, or (iii) to pay
any other amount chargeable to any Borrower or Guarantor pursuant to the terms
of this Agreement or any of the other Financing Agreements consisting of (A)
costs, fees and expenses and (B) payments to any issuer in respect of Letter of
Credit Accommodations which are issued in accordance with the terms of the
other Sections of this Agreement; provided, that, the total outstanding
principal amount of the Special Agent Advances pursuant to Section 12.11(a)(i)
and (ii) hereof plus the total outstanding principal amount of the additional
Loans and Letter of Credit Accommodations which Agent may make or provide as
set forth in Section 12.8 hereof shall not exceed the aggregate amount equal to
ten (10%) percent of the Maximum Credit; provided, further, that,
the total outstanding principal amount of Loans, Letter of Credit
Accommodations and the Special Agent Advances pursuant to Section 12.11(a)(i)
and (ii) hereof shall not exceed the Maximum Credit. Special Agent Advances
shall be repayable on demand and together with all interest thereon shall
constitute Obligations secured by the Collateral. Special Agent Advances shall
not constitute Loans but shall otherwise constitute Obligations hereunder. Interest
on Special Agent Advances shall be payable at the Interest Rate then applicable
to Prime Rate Loans and shall be payable on demand. Without limitation of its
obligations pursuant to Section 6.10, each Lender agrees that it shall make
available to Agent, upon Agent’s demand, in immediately available funds, the
amount equal to such Lender’s Pro Rata Share of each such Special Agent Advance.
If such funds are not made available to Agent by such Lender, such Lender shall
be deemed a Defaulting Lender and Agent shall be entitled to recover such
funds, on demand from such Lender together with interest thereon for each day
from the date such payment was due until the date such amount is paid to Agent
at the Federal Funds Rate for each day during such period (as published by the
Federal Reserve Bank of New York or at Agent’s option based on the arithmetic
mean determined by Agent of the rates for the last transaction in overnight
Federal funds arranged prior to 9:00 a.m. (New York City time) on that day by
each of the three leading brokers of Federal funds transactions in New York
City selected by Agent) and if such amounts are not paid within three (3) days
of Agent ‘s demand, at the highest Interest Rate provided for in Section 3.1
hereof applicable to Prime Rate Loans.


 


(b)           Lenders
hereby irrevocably authorize Agent, at its option and in its discretion to
release any security interest in, mortgage or lien upon, any of the Collateral
(i) upon termination of the Commitments and payment and satisfaction of
all of the Obligations and delivery of cash collateral to the extent required
under Section 13.1 below, or (ii) constituting property being sold or
disposed of if Administrative Borrower or any Borrower or Guarantor certifies
to Agent that the sale or disposition is made in compliance with Section 9.7
hereof (and Agent may rely conclusively on any such certificate, without
further inquiry), and to the extent that the Capital Stock of any Propco is
sold in compliance with Section 9.7 hereof, such Propco shall cease to be a
Guarantor under this Agreement or any of the other Financing Agreements, or
(iii) constituting property in which any Borrower or Guarantor did not own an
interest at the time the security interest, mortgage or lien was granted or at
any time thereafter, or (iv) constituting property being pledged to a third
party if Administrative Borrower or any Borrower or Guarantor certifies to
Agent that such pledge is made in compliance with Section 9.8(l) hereof (and
Agent may rely conclusively on any such certificate, without further inquiry),
(v) having a value in the aggregate in any twelve (12) month period of less
than $1,000,000, and to the extent Agent may release its security interest in
and lien upon any such Collateral pursuant to the sale or other disposition
thereof, such sale or other disposition shall be deemed consented to by
Lenders, or


 


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(vi) if required or
permitted under the terms of any of the other Financing Agreements, including
any intercreditor agreement, or (vii) approved, authorized or ratified in
writing by all of Lenders. Except as provided above, Agent will not release any
security interest in, mortgage or lien upon, any of the Collateral without the
prior written authorization of all of Lenders. Upon request by Agent at any
time, Lenders will promptly confirm in writing Agent’s authority to release
particular types or items of Collateral pursuant to this Section. Nothing
contained herein shall be construed to require the consent of any Bank Product
Provider to any release of any Collateral or termination of security interests
in any Collateral, except for the cash collateral delivered pursuant to Section
13.1(a) hereof for Obligations arising under or in connection with any Bank
Products.


 


(c)           Without
any manner limiting Agent’s authority to act without any specific or further
authorization or consent by the Required Lenders, each Lender agrees to confirm
in writing, upon request by Agent, the authority to release Collateral
conferred upon Agent under this Section. Agent shall (and is hereby irrevocably
authorized by Lenders to) execute such documents as may be necessary to evidence
the release of the security interest, mortgage or liens granted to Agent upon
any Collateral to the extent set forth above; provided, that,
 (i) Agent shall not be required to execute any such document on terms
which, in Agent’s opinion, would expose Agent to liability or create any
obligations or entail any consequence other than the release of such security
interest, mortgage or liens without recourse or warranty and  (ii) such
release shall not in any manner discharge, affect or impair the Obligations or
any security interest, mortgage or lien upon (or obligations of any Borrower or
Guarantor in respect of) the Collateral retained by such Borrower or Guarantor.


 


(d)           Agent
shall have no obligation whatsoever to any Lender or any other Person to
investigate, confirm or assure that the Collateral exists or is owned by any
Borrower or Guarantor or is cared for, protected or insured or has been
encumbered, or that any particular items of Collateral meet the eligibility
criteria applicable in respect of the Loans or Letter of Credit Accommodations
hereunder, or whether any particular reserves are appropriate, or that the
liens and security interests granted to Agent pursuant hereto or any of the
Financing Agreements or otherwise have been properly or sufficiently or
lawfully created, perfected, protected or enforced or are entitled to any
particular priority, or to exercise at all or in any particular manner or under
any duty of care, disclosure or fidelity, or to continue exercising, any of the
rights, authorities and powers granted or available to Agent in this Agreement
or in any of the other Financing Agreements, it being understood and agreed
that in respect of the Collateral, or any act, omission or event related
thereto, subject to the other terms and conditions contained herein, Agent may
act in any manner it may deem appropriate, in its discretion, given Agent’s own
interest in the Collateral as a Lender and that Agent shall have no duty or
liability whatsoever to any other Lender.


 


(e)           Without
limiting the generality of the foregoing, each Lender consents to the HPT
Letter Agreements (as defined below) and any other agreements delivered
pursuant to Section 9.12(d) hereof, and agrees to be bound by the terms
thereof, whether or not such Lender executes the HPT Letter Agreements or any
such other agreements. As used herein, “HPT Letter Agreements” shall mean,
collectively, the Letter Agreements referred to in Section 1.67 hereof, as the
same may be amended or otherwise modified from time to time.


 


12.12    Agency for Perfection. Each
Lender hereby appoints Agent and each other Lender as agent and bailee for the
purpose of perfecting the security interests in and liens upon the


 


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Collateral of Agent in assets which, in accordance
with Article 9 of the UCC can be perfected only by possession (or where the
security interest of a secured party with possession has priority over the
security interest of another secured party) and Agent and each Lender hereby acknowledges
that it holds possession of any such Collateral for the benefit of Agent as
secured party. Should any Lender obtain possession of any such Collateral, such
Lender shall notify Agent thereof, and, promptly upon Agent’s request therefor
shall deliver such Collateral to Agent or in accordance with Agent’s
instructions.


 


12.13    Successor Agent. Agent
may resign as Agent upon thirty (30) days’ notice to Lenders and Parent. If
Agent resigns under this Agreement, the Required Lenders shall appoint from among
the Lenders a successor agent for Lenders. If no successor agent is appointed
prior to the effective date of the resignation of Agent, Agent may appoint,
after consulting with Lenders and Parent, a successor agent from among Lenders.
Upon the acceptance by the Lender so selected of its appointment as successor
agent hereunder, such successor agent shall succeed to all of the rights,
powers and duties of the retiring Agent and the term “Agent” as used herein and
in the other Financing Agreements shall mean such successor agent and the
retiring Agent’s appointment, powers and duties as Agent shall be terminated. After
any retiring Agent’s resignation hereunder as Agent, the provisions of this
Section 12 shall inure to its benefit as to any actions taken or omitted by it
while it was Agent under this Agreement. If no successor agent has accepted
appointment as Agent by the date which is thirty (30) days after the date of a
retiring Agent ‘s notice of resignation, the retiring Agent’s resignation shall
nonetheless thereupon become effective and Lenders shall perform all of the
duties of Agent hereunder until such time, if any, as the Required Lenders
appoint a successor agent as provided for above.


 


12.14    Other Agent Designations.
Agent may at any time and from time to time determine that a Lender may, in
addition, be a “Co-Agent”, “Syndication Agent”, “Documentation Agent” or
similar designation hereunder and enter into an agreement with such Lender to
have it so identified for purposes of this Agreement. Any such designation
shall be effective upon written notice by Agent to Administrative Borrower of
any such designation. Any Lender that is designated as a Co-Agent, Syndication
Agent, Documentation Agent or such similar designation by Agent shall have no
right, power, obligation, liability, responsibility or duty under this
Agreement or any of the other Financing Agreements other than those applicable
to all Lenders as such. Without limiting the foregoing, the Lenders so
identified shall not have or be deemed to have any fiduciary relationship with
any Lender and no Lender shall be deemed to have relied, nor shall any Lender
rely, on a Lender so identified as a Co-Agent, Syndication Agent, Documentation
Agent or such similar designation in deciding to enter into this Agreement or
in taking or not taking action hereunder.


 


SECTION 13.               TERM OF AGREEMENT; MISCELLANEOUS


 


13.1   Term.


 


(a)           This
Agreement and the other Financing Agreements shall become effective as of the
date set forth on the first page hereof and shall continue in full force and
effect for a term ending on the date five (5) years from the date hereof (the “Maturity
Date”). Borrowers may terminate this Agreement at any time upon ten (10) days
prior written notice to Agent (which notice shall be irrevocable) and Agent
may, at its option, and shall at the direction of Required Lenders, terminate
this Agreement at any time upon the occurrence and during the continuance of an
Event of Default. Upon the Maturity Date or any other effective date of


 


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termination of the
Financing Agreements, Borrowers shall pay to Agent all outstanding and unpaid
Obligations and shall furnish cash collateral to Agent (or at Agent’s option, a
letter of credit issued for the account of Borrowers and at Borrowers’ expense,
in form and substance reasonably satisfactory to Agent, by an issuer acceptable
to Agent and payable to Agent as beneficiary) in such amounts as Agent
determines are reasonably necessary to secure Agent and Lenders from loss,
cost, damage or expense, including reasonable attorneys’ fees and expenses, in
connection with any contingent Obligations (other than unasserted contingent
indemnification claims), including issued and outstanding Letter of Credit
Accommodations and checks or other payments provisionally credited to the
Obligations and/or as to which Agent or any Lender has not yet received final
and indefeasible payment and any continuing obligations of Agent or any Lender
pursuant to any Deposit Account Control Agreement and for any of the
Obligations arising under or in connection with any Bank Products in such
amounts as the party providing such Bank Products may reasonably require
(unless such Obligations arising under or in connection with any Bank Products
are paid in full in cash and terminated in a manner reasonably satisfactory to
such other party). The amount of such cash collateral (or letter of credit, as
Agent may determine) as to any Letter of Credit Accommodations shall be in the
amount equal to one hundred two (102%) percent of the amount of the Letter of
Credit Accommodations plus the amount of any fees and expenses payable in
connection therewith through the end of the latest expiration date of such
Letter of Credit Accommodations. Such payments in respect of the Obligations
and cash collateral shall be remitted by wire transfer in Federal funds to the
Agent Payment Account or such other bank account of Agent, as Agent may, in its
discretion, designate in writing to Administrative Borrower for such purpose. Interest
shall be due until and including the next Business Day, if the amounts so paid
by Borrowers to the Agent Payment Account or other bank account designated by
Agent are received in such bank account later than 12:00 noon, Chicago, Illinois
time.


 


(b)           No
termination of this Agreement or the other Financing Agreements shall relieve
or discharge any Borrower or Guarantor of its respective duties, obligations
and covenants under this Agreement or the other Financing Agreements until all
Obligations (other than unasserted contingent indemnification claims) have been
fully and finally discharged and paid, and Agent’s continuing security interest
in the Collateral and the rights and remedies of Agent and Lenders hereunder,
under the other Financing Agreements and applicable law, shall remain in effect
until all such Obligations have been fully and finally discharged and paid. Accordingly,
each Borrower and Guarantor waives any rights it may have under the UCC to
demand the filing of termination statements with respect to the Collateral and
Agent shall not be required to send such termination statements to Borrowers or
Guarantors, or to file them with any filing office, unless and until this
Agreement shall have been terminated in accordance with its terms and all
Obligations paid and satisfied in full in immediately available funds.


 


13.2   Interactive Provisions.


 


(a)           All
terms used herein which are defined in Article 1, Article 8 or Article 9 of the
UCC shall have the meanings given therein unless otherwise defined in this
Agreement.


 


(b)           All
references to the plural herein shall also mean the singular and to the
singular shall also mean the plural unless the context otherwise requires.


 


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(c)           All
references to any Borrower, Guarantor, Agent and Lenders pursuant to the
definitions set forth in the recitals hereto, or to any other person herein,
shall include their respective successors and assigns.


 


(d)           The
words “hereof”, “herein”, “hereunder”, “this Agreement” and words of similar
import when used in this Agreement shall refer to this Agreement as a whole and
not any particular provision of this Agreement and as this Agreement now exists
or may hereafter be amended, modified, supplemented, extended, renewed,
restated or replaced.


 


(e)           The
word “including” when used in this Agreement shall mean “including, without
limitation” and the word “will” when used in this Agreement shall be construed
to have the same meaning and effect as the word “shall”.


 


(f)            An
Event of Default shall continue or be continuing until such Event of Default is
waived in accordance with Section 11.3 or is cured in a manner satisfactory to
Agent, if such Event of Default is capable of being cured as determined by
Agent.


 


(g)           All
references to the term “good faith” used herein when applicable to Agent or any
Lender shall mean, notwithstanding anything to the contrary contained herein or
in the UCC, honesty in fact in the conduct or transaction concerned. Borrowers
and Guarantors shall have the burden of proving any lack of good faith on the
part of Agent or any Lender alleged by any Borrower or Guarantor at any time.


 


(h)           Any
accounting term used in this Agreement shall have, unless otherwise
specifically provided herein, the meaning customarily given in accordance with
GAAP, and all financial computations hereunder shall be computed unless
otherwise specifically provided herein, in accordance with GAAP as consistently
applied and using the same method for inventory valuation as used in the
preparation of the financial statements of Parent most recently received by
Agent prior to the date hereof. Notwithstanding anything to the contrary
contained in GAAP or any interpretations or other pronouncements by the
Financial Accounting Standards Board or otherwise, the term “unqualified
opinion” as used herein to refer to opinions or reports provided by accountants
shall mean an opinion or report that is not only unqualified but also does not
include any explanation, supplemental comment or other comment concerning the
ability of the applicable person to continue as a going concern or the scope of
the audit.


 


(i)            In
the computation of periods of time from a specified date to a later specified
date, the word “from” means “from and including”, the words “to” and “until”
each mean “to but excluding” and the word “through” means “to and including”.


 


(j)            Unless
otherwise expressly provided herein, (i) references herein to any
agreement, document or instrument shall be deemed to include all subsequent
amendments, modifications, supplements, extensions, renewals, restatements or
replacements with respect thereto, but only to the extent the same are not
prohibited by the terms hereof or of any other Financing Agreement, and
(ii) references to any statute or regulation are to be construed as
including all statutory and regulatory provisions consolidating, amending,
replacing, recodifying, supplementing or interpreting the statute or
regulation.


 


(k)           The
captions and headings of this Agreement are for convenience of reference only
and shall not affect the interpretation of this Agreement.


 


118

















 


(l)            This
Agreement and other Financing Agreements may use several different limitations,
tests or measurements to regulate the same or similar matters. All such
limitations, tests and measurements are cumulative and shall each be performed
in accordance with their terms.


 


(m)          This
Agreement and the other Financing Agreements are the result of negotiations
among and have been reviewed by counsel to Agent and the other parties, and are
the products of all parties. Accordingly, this Agreement and the other
Financing Agreements shall not be construed against Agent or Lenders merely
because of Agent’s or any Lender’s involvement in their preparation.


 


13.3   Notices. All notices,
requests and demands hereunder shall be in writing and deemed to have been
given or made:  if delivered in person,
immediately upon delivery; if by telex, telegram or facsimile transmission,
immediately upon sending and upon confirmation of receipt; if by nationally
recognized overnight courier service with instructions to deliver the next
Business Day, one (1) Business Day after sending; and if by certified mail,
return receipt requested, five (5) days after mailing. All notices, requests
and demands upon the parties are to be given to the following addresses (or to
such other address as any party may designate by notice in accordance with this
Section):


 


	
  If to any Borrower or Guarantor:

  	
   

  	
  TravelCenters of
  America LLC

  
	
   

  	
   

  	
  24601 Center Ridge
  Road, Suite 200

  
	
   

  	
   

  	
  Westlake, Ohio,
  44145-5639

  
	
   

  	
   

  	
  Attention: John R.
  Hoadley

  
	
   

  	
   

  	
  Telephone No.: (440)
  617-1116

  
	
   

  	
   

  	
  Telecopy No.: (440)
  808-3301

  
	
   

  	
   

  	
   

  
	
  with a copy to:

  	
   

  	
  TravelCenters of
  America LLC

  
	
   

  	
   

  	
  400 Centre Street

  
	
   

  	
   

  	
  Newton, Massachusetts
  02458

  
	
   

  	
   

  	
  Attention: Mark R.
  Young, Esq.

  
	
   

  	
   

  	
  Telephone No.: (617)
  796-8157

  
	
   

  	
   

  	
  Telecopy No.: (617)
  969-4697

  
	
   

  	
   

  	
   

  
	
  If to Agent:

  	
   

  	
  Wachovia Capital
  Finance Corporation

  
	
   

  	
   

  	
  (Central)

  
	
   

  	
   

  	
  150 South Wacker Drive

  
	
   

  	
   

  	
  Chicago, Illinois
  60606-4202

  
	
   

  	
   

  	
  Attention: Portfolio
  Manager

  
	
   

  	
   

  	
  Telephone No.: (312)
  332-0420

  
	
   

  	
   

  	
  Telecopy No.: (312)
  332-0424

  



 


13.4   Partial Invalidity. If
any provision of this Agreement is held to be invalid or unenforceable, such
invalidity or unenforceability shall not invalidate this Agreement as a whole,
but this Agreement shall be construed as though it did not contain the
particular provision held to be invalid or unenforceable and the rights and
obligations of the parties shall be construed and enforced only to such extent
as shall be permitted by applicable law.


 


13.5   Confidentiality.


 


119

















 


(a)           Agent
and each Lender shall use all reasonable efforts to keep confidential, in
accordance with its customary procedures for handling confidential information
and safe and sound lending practices, any non-public information supplied to it
by any Borrower pursuant to this Agreement which is clearly and conspicuously
marked as confidential at the time such information is furnished by such
Borrower to Agent or such Lender, provided, that, nothing
contained herein shall limit the disclosure of any such information: (i) to the
extent required by statute, rule, regulation, subpoena or court order, (ii) to
the extent requested by any bank examiners and other regulators (including any
self-regulatory authority such as the National Association of Insurance
Commissioners), auditors and/or accountants, (iii) in connection with any
litigation to which Agent or such Lender is a party, (iv) to any Lender or
Participant (or prospective Lender or Participant) or to any Affiliate of any
Lender so long as such Lender or Participant (or prospective Lender or
Participant) or Affiliate shall agreed to treat such information as
confidential in accordance with this Section 13.5, or (v) to counsel for Agent
or any Lender or Participant (or prospective Lender or Participant).


 


(b)           In
the event that Agent or any Lender receives a request or demand to disclose any
confidential information pursuant to any subpoena or court order, Agent or such
Lender, as the case may be, agrees (i) to the extent permitted by applicable
law or if permitted by applicable law, to the extent Agent or such Lender
determines in good faith that it will not create any risk of liability to Agent
or such Lender, Agent or such Lender will promptly notify Administrative
Borrower of such request so that Administrative Borrower may seek a protective
order or other appropriate relief or remedy and (ii) if disclosure of such
information is required, disclose such information and, subject to
reimbursement by Borrowers of Agent’s or such Lender’s expenses, cooperate with
Administrative Borrower in the reasonable efforts to obtain an order or other
reliable assurance that confidential treatment will be accorded to such portion
of the disclosed information which Administrative Borrower so designates, to
the extent permitted by applicable law or if permitted by applicable law, to
the extent Agent or such Lender determines in good faith that it will not
create any risk of liability to Agent or such Lender.


 


(c)           In
no event shall this Section 13.5 or any other provision of this Agreement, any
of the other Financing Agreements or applicable law be deemed: (i) to apply to
or restrict disclosure of information that has been or is made public by any
Borrower, Guarantor or any third party or otherwise becomes generally available
to the public other than as a result of a disclosure in violation hereof, (ii)
to apply to or restrict disclosure of information that was or becomes available
to Agent or any Lender (or any Affiliate of any Lender) on a non-confidential
basis from a person other than a Borrower or Guarantor, (iii) to require Agent
or any Lender to return any materials furnished by a Borrower or Guarantor to
Agent or a Lender or  prevent Agent or a
Lender from responding to routine informational requests  in accordance with the Code of Ethics for
the Exchange of Credit Information promulgated by The Robert Morris
Associates or other applicable industry standards relating to the exchange of
credit information. The obligations of Agent and Lenders under this Section
13.5 shall supersede and replace the obligations of Agent and Lenders under any
confidentiality letter signed prior to the date hereof.


 


(d)           Notwithstanding
anything to the contrary set forth herein or in any of the other Financing
Agreements or any other written or oral understanding or agreement,  any obligations of confidentiality contained
herein, in any of the other Financing Agreements or any such other
understanding or agreement do not apply and have not applied from the
commencement of discussions between the parties to the tax treatment and tax
structure of the


 


120

















 


transactions contemplated
herein (and any related transactions or arrangements), and  each party (and each of its employees,
representatives, or other agents) may disclose to any and all persons the tax
treatment and tax structuring of the transactions contemplated herein and all
materials of any kind (including opinions or other tax analyses) that are
provided to such party relating to such tax treatment and tax structure, all
within the meaning of Treasury Regulation Section 1.6011-4; provided, that,
each party recognizes that the privilege that it may, in its discretion,
maintain with respect to the confidentiality of a communication relating to the
transactions contemplated herein, including a confidential communication with
its attorney or a confidential communication with a federally authorized tax
practitioner under Section 7525 of the Internal Revenue Code, is not intended
to be affected by the foregoing. Borrowers and Guarantors do not intend to
treat the Loans and related transactions as being a “reportable transaction”
(within the meaning of Treasury Regulation Section 1.6011-4). In the event
Borrowers or Guarantors determine to take any action inconsistent with such
intention, it will promptly notify Agent thereof. Each Borrower and Guarantor
acknowledges that one or more of Lenders may treat its Loans as part of a
transaction that is subject to Treasury Regulation Section 1.6011-4 or Section
301.6112-1, and the Agent and such Lender or Lenders, as applicable, may file
such IRS forms or maintain such lists and other records as they may determine
is required by such Treasury Regulations.


 


13.6   Successors. This
Agreement, the other Financing Agreements and any other document referred to
herein or therein shall be binding upon and inure to the benefit of and be
enforceable by Agent, Lenders, Borrowers, Guarantors and their respective
successors and assigns, except that Borrower may not assign its rights under
this Agreement, the other Financing Agreements and any other document referred
to herein or therein without the prior written consent of Agent and Lenders. Any
such purported assignment without such express prior written consent shall be
void. No Lender may assign its rights and obligations under this Agreement
without the prior written consent of Agent, except as provided in Section 13.7
below. The terms and provisions of this Agreement and the other Financing
Agreements are for the purpose of defining the relative rights and obligations
of Borrowers, Guarantors, Agent and Lenders with respect to the transactions
contemplated hereby and there shall be no third party beneficiaries of any of
the terms and provisions of this Agreement or any of the other Financing
Agreements.


 


13.7   Assignments; Participations.



 


(a)           Each
Lender may, with the prior written consent of Agent (which consent shall not be
unreasonably withheld or delayed), assign all or, if less than all, a portion
equal to at least $10,000,000 (or such lesser amount as Agent may agree) in the
aggregate for the assigning Lender, of such rights and obligations under this
Agreement to one or more Eligible Transferees (but not including for this
purpose any assignments in the form of a participation), each of which
assignees shall become a party to this Agreement as a Lender by execution of an
Assignment and Acceptance; provided, that, (i) such transfer
or assignment will not be effective until recorded by Agent on the Register and
(ii) Agent shall have received for its sole account payment of a processing fee
from the assigning Lender or the assignee in the amount of $5,000.


 


(b)           Agent
shall maintain a register of the names and addresses of Lenders, their
Commitments and the principal amount of their Loans (the “Register”). Agent
shall also maintain a copy of each Assignment and Acceptance delivered to and
accepted by it and shall modify the Register to give effect to each Assignment
and Acceptance. The entries in the


 


121

















 


Register shall be
conclusive and binding for all purposes, absent manifest error, and any
Borrowers, Obligors, Agent and Lenders may treat each Person whose name is
recorded in the Register as a Lender hereunder for all purposes of this
Agreement. The Register shall be available for inspection by Administrative
Borrower and any Lender at any reasonable time and from time to time upon
reasonable prior notice.


 


(c)           Upon
such execution, delivery, acceptance and recording, from and after the
effective date specified in each Assignment and Acceptance,  the assignee
thereunder shall be a party hereto and to the other Financing Agreements and,
to the extent that rights and obligations hereunder have been assigned to it
pursuant to such Assignment and Acceptance, have the rights and obligations
(including, without limitation, the obligation to participate in Letter of
Credit Accommodations) of a Lender hereunder and thereunder and  the
assigning Lender 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 under this Agreement.


 


(d)           By
execution and delivery of an Assignment and Acceptance, the assignor and
assignee thereunder confirm to and agree with each other and the other parties
hereto as follows:  (i) other than
as provided in such Assignment and Acceptance, the assigning Lender makes no
representation or warranty and assumes no responsibility with respect to any
statements, warranties or representations made in or in connection with this
Agreement or any of the other Financing Agreements or the execution, legality,
enforceability, genuineness, sufficiency or value of this Agreement or any of
the other Financing Agreements furnished pursuant hereto, (ii) the
assigning Lender makes no representation or warranty and assumes no responsibility
with respect to the financial condition of any Borrower, Obligor or any of
their Subsidiaries or the performance or observance by any Borrower or Obligor
of any of the Obligations; (iii) such assignee confirms that it has
received a copy of this Agreement and the other Financing Agreements, together
with such other documents and information it has deemed appropriate to make its
own credit analysis and decision to enter into such Assignment and Acceptance,
(iv) such assignee will, independently and without reliance upon the
assigning Lender, Agent and based on such documents and information as it shall
deem appropriate at the time, continue to make its own credit decisions in
taking or not taking action under this Agreement and the other Financing Agreements,
(v) such assignee appoints and authorizes Agent to take such action as
agent on its behalf and to exercise such powers under this Agreement and the
other Financing Agreements as are delegated to Agent by the terms hereof and
thereof, together with such powers as are reasonably incidental thereto, and
(vi) such assignee agrees that it will perform in accordance with their
terms all of the obligations which by the terms of this Agreement and the other
Financing Agreements are required to be performed by it as a Lender. Agent and
Lenders may furnish any information concerning any Borrower or Obligor in the
possession of Agent or any Lender from time to time to assignees and
Participants.


 


(e)           Each
Lender may sell participations to one or more banks or other entities in or to
all or a portion of its rights and obligations under this Agreement and the
other Financing Agreements (including, without limitation, all or a portion of
its Commitments and the Loans owing to it and its participation in the Letter
of Credit Accommodations, without the consent of Agent or the other Lenders); provided,
that, (i) such Lender’s obligations under this Agreement
(including, without limitation, its Commitment hereunder) and the other
Financing Agreements


 


122

















 


shall remain unchanged,
(ii) such Lender shall remain solely responsible to the other parties
hereto for the performance of such obligations, and Borrowers, Guarantors, the
other Lenders and Agent shall continue to deal solely and directly with such
Lender in connection with such Lender’s rights and obligations under this
Agreement and the other Financing Agreements, and (iii) the Participant
shall not have any rights under this Agreement or any of the other Financing Agreements
(the Participant’s rights against such Lender in respect of such participation
to be those set forth in the agreement executed by such Lender in favor of the
Participant relating thereto) and all amounts payable by any Borrower or
Obligor hereunder shall be determined as if such Lender had not sold such
participation.


 


(f)            Nothing
in this Agreement shall prevent or prohibit any Lender from pledging its Loans
hereunder to a Federal Reserve Bank in support of borrowings made by such
Lenders from such Federal Reserve Bank; provided, that, no such
pledge shall release such Lender from any of its obligations hereunder or
substitute any such pledgee for such Lender as a party hereto.


 


(g)           Borrowers
and Guarantors shall assist Agent or any Lender permitted to sell assignments
or participations under this Section 13.7 in whatever manner reasonably
necessary in order to enable or effect any such assignment or participation,
including (but not limited to) the execution and delivery of any and all
agreements, notes and other documents and instruments as shall be requested and
the delivery of informational materials, appraisals or other documents for, and
the participation of relevant management in meetings and conference calls with,
potential Lenders or Participants. Borrowers shall certify the correctness,
completeness and accuracy, in all material respects, of all descriptions of
Borrowers and Guarantors and their affairs provided, prepared or reviewed by
any Borrower or Guarantor that are contained in any selling materials and all
other information provided by it and included in such materials.


 


13.8   USA Patriot Act. Each
Lender hereby notifies Borrowers and Guarantors that pursuant to the
requirements of the USA Patriot Act, it is required to obtain, verify and
record information that Identifies each Borrower and Guarantor, which
information includes the name and address of such Borrower and Guarantor and
other information that will allow such Lender to identify such Borrower and
Guarantor in accordance with the requirements of such Act and any other
applicable law.


 


13.9   Entire Agreement. This
Agreement, the other Financing Agreements, any supplements hereto or thereto,
and any instruments or documents delivered or to be delivered in connection
herewith or therewith represents the entire agreement and understanding
concerning the subject matter hereof and thereof between the parties hereto,
and supersede all other prior agreements, understandings, negotiations and
discussions, representations, warranties, commitments, proposals, offers and
contracts concerning the subject matter hereof, whether oral or written. In the
event of any inconsistency between the terms of this Agreement and any schedule
or exhibit hereto, the terms of this Agreement shall govern.


 


13.10 Counterparts, Etc. This
Agreement or any of the other Financing Agreements may be executed in any
number of counterparts, each of which shall be an original, but all of which
taken together shall constitute one and the same agreement. Delivery of an executed
counterpart of this Agreement or any of the other Financing Agreements by
telefacsimile shall have the same force and effect as the delivery of an
original executed counterpart of this Agreement or any of such other Financing
Agreements. Any party delivering an executed counterpart of any such


 


123

















 


agreement by telefacsimile shall also deliver an
original executed counterpart, but the failure to do so shall not affect the
validity, enforceability or binding effect of such agreement.


 


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INTENTIONALLY LEFT BLANK]


 


124

















 


IN WITNESS WHEREOF, Agent, Lenders, Borrowers and
Guarantors have caused these presents to be duly executed as of the day and year
first above written.


 


	
  

  	
  BORROWERS

  
	
   

  	
   

  
	
   

  	
  TRAVELCENTERS OF
  AMERICA LLC

  
	
   

  	
   

  
	
   

  	
  By:

  	
   /s/ John R. Hoadley

  	
   

  
	
   

  	
  Title: Treasurer

  
	
   

  	
   

  
	
   

  	
  TA LEASING LLC

  
	
   

  	
   

  
	
   

  	
  By:

  	
   /s/ John R. Hoadley

  	
   

  
	
   

  	
  Title: Treasurer

  
	
   

  	
   

  
	
   

  	
  TA OPERATING LLC

  
	
   

  	
   

  
	
   

  	
  By:

  	
   /s/ John R. Hoadley

  	
   

  
	
   

  	
  Title: Treasurer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  GUARANTORS

  
	
   

  	
   

  
	
   

  	
  TRAVELCENTERS OF
  AMERICA HOLDING

  COMPANY LLC

  
	
   

  	
   

  
	
   

  	
  By:

  	
   /s/ John R. Hoadley

  	
   

  
	
   

  	
  Title: Treasurer

  
	
   

  	
   

  
	
   

  	
  PETRO STOPPING
  CENTERS, L.P.

  
	
   

  	
   

  
	
   

  	
  By: TCA PSC GP
  LLC, its

  
	
   

  	
  General Partner

  
	
   

  	
   

  
	
   

  	
  By:

  	
   /s/ John R. Hoadley

  	
   

  
	
   

  	
  Title: Treasurer

  
	
   

  	
   

  
	
   

  	
  PETRO
  DISTRIBUTING INC.

  
	
   

  	
   

  
	
   

  	
  By:

  	
   /s/ John R. Hoadley

  	
   

  
	
   

  	
  Title: Treasurer

  
					



 


[SIGNATURES
CONTINUE ON NEXT PAGE]


 

















 


[SIGNATURES CONTINUED
FROM PREVIOUS PAGE]


 


 


	
  

  	
  PETRO FINANCIAL
  CORPORATION

  
	
   

  	
   

  
	
   

  	
  By:

  	
   /s/ John R. Hoadley

  	
   

  
	
   

  	
  Title: Treasurer

  
	
   

  	
   

  
	
   

  	
  PETRO HOLDINGS
  FINANCIAL

  CORPORATION

  
	
   

  	
   

  
	
   

  	
  By:

  	
   /s/ John R. Hoadley

  	
   

  
	
   

  	
  Title: Treasurer

  
	
   

  	
   

  
	
   

  	
  TCA PSC GP LLC

  
	
   

  	
   

  
	
   

  	
  By:

  	
   /s/ John R. Hoadley

  	
   

  
	
   

  	
  Title: Treasurer

  
					



 


AGENT


 


	
  WACHOVIA CAPITAL FINANCE

  	
   

  
	
  CORPORATION (CENTRAL),

  	
   

  
	
  as Agent

  	
   

  
	
   

  	
   

  
	
  By:

  	
   /s/ Laura D. Wheeland

  	
   

  	
   

  
	
   

  	
   

  
	
  Title:

  	
  Vice President

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  LENDERS

  	
   

  
	
   

  	
   

  
	
  WACHOVIA CAPITAL FINANCE CORPORATION

  	
   

  
	
  (CENTRAL)

  	
   

  
	
   

  	
   

  
	
  By:

  	
   /s/ Laura D.
  Wheeland

  	
   

  	
   

  
	
   

  	
   

  
	
  Title:

  	
  Vice President

  	
   

  	
   

  
							



 

















 


NATIONAL CITY BUSINESS
CREDIT, INC.


 


 


	
  By:

  	
   /s/ Kathryn C. Ellero

  	
   

  
	
   

  
	
  Title:

  	
  Vice President

  	
   

  
				



 


BANK OF AMERICA, N.A.


 


 


	
  By:

  	
  /s/ Michael W. Brunner

  	
   

  
	
   

  
	
  Title:

  	
  Vice President

  	
   

  
				



 


 


U.S. BANK NATIONAL
ASSOCIATION


 


 


	
  By:

  	
  /s/ Matthew P. Kasper

  	
   

  
	
   

  
	
  Title:

  	
  Assistant Vice
  President

  	
   

  
				



 


 


UBS LOAN FINANCE LLC


 


 


	
  By:

  	
   /s/ Irja R. Olsa

  	
   

  	
  /s/ Mary E. Evans

  	
   

  
	
   

  
	
  Title:

  	
  Associate Director,

  	
   

  	
  Associate Director,

  	
   

  
	
   

  	
  Banking Products
  Services, U.S.

  	
   

  	
  Banking Products
  Services, U.S.

  
						



 


 


ROYAL BANK OF CANADA


 


 


	
  By:

  	
  /s/ Dustin Craven

  	
   

  
	
   

  
	
  Title:

  	
  Attorney-in-fact

  	
   

  
				



 

















 


The following exhibits and schedules have been
omitted and will be supplementally furnished to the Securities and Exchange
Commission upon request:


 


	
  Exhibit A

  	
   

  	
  Form of Assignment and Acceptance Agreement

  
	
   

  	
   

  	
   

  
	
  Exhibit B

  	
   

  	
  Information Certificate

  
	
   

  	
   

  	
   

  
	
  Exhibit C

  	
   

  	
  Form of Compliance Certificate

  
	
   

  	
   

  	
   

  
	
  Exhibit D

  	
   

  	
  Form of Borrowing Base Certificate

  
	
   

  	
   

  	
   

  
	
  Schedule 1.18

  	
   

  	
  Excluded Capital Leases

  
	
   

  	
   

  	
   

  
	
  Schedule 1.66

  	
   

  	
  Excluded Subsidiaries

  
	
   

  	
   

  	
   

  
	
  Schedule 1.118

  	
   

  	
  Petro Existing Letters of Credit

  
	
   

  	
   

  	
   

  
	
  Schedule 8.16

  	
   

  	
  Credit Card Agreements

  



 

















 


 


Schedule 1


 


COMMITMENTS


 


	
  Lender

  	
   

  	
  Commitment

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Wachovia Capital
  Finance Corporation (Central)

  	
   

  	
  $

  	
  25,000,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  National City
  Business Credit, Inc.

  	
   

  	
  $

  	
  25,000,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Bank of America,
  N.A.

  	
   

  	
  $

  	
  15,000,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  U.S. Bank
  National Association 

  	
   

  	
  $

  	
  10,000,000 

  	
    

  
	
   

  	
   

  	
   

  	
   

  
	
  UBS Loan Finance
  LLC

  	
   

  	
  $

  	
  15,000,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Royal Bank of
  Canada

  	
   

  	
  $

  	
  10,000,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Total

  	
   

  	
  $

  	
  100,000,000