exv10w2






Exhibit 10.2




 





CREDIT AGREEMENT




by and among



TRONOX LLC

as Borrower



TRONOX INCORPORATED

TRONOX WORLDWIDE LLC

TRONOX FINANCE CORP.

CIMARRON CORPORATION

TRIPLE S REFINING CORPORATION

SOUTHWESTERN REFINING COMPANY, INC.

TRIANGLE REFINERIES, INC.

TRANSWORLD DRILLING COMPANY

TRIPLE S MINERALS RESOURCES CORPORATION

TRIPLE S, INC.

TRONOX HOLDINGS, INC.

TRONOX PIGMENTS (SAVANNAH) INC.

as Guarantors



THE LENDERS THAT ARE SIGNATORIES HERETO

as the Lenders,



and



WELLS FARGO CAPITAL FINANCE, LLC

as the Agent



WELLS FARGO CAPITAL FINANCE, LLC

as Sole Lead Arranger, Manager and Bookrunner



Dated as of February 14, 2011



 





 









 








TABLE OF CONTENTS




	 	 	 	 	 
	 	 	Page	 
	1. DEFINITIONS AND CONSTRUCTION
	 	 	1	 
	 
	 	 	 	 
	1.1 Definitions
	 	 	1	 
	1.2 Accounting Terms
	 	 	1	 
	1.3 UCC
	 	 	1	 
	1.4 Construction
	 	 	2	 
	1.5 Schedules and Exhibits
	 	 	3	 
	 
	 	 	 	 
	2. LOANS AND TERMS OF PAYMENT
	 	 	3	 
	 
	 	 	 	 
	2.1 Revolver Advances
	 	 	3	 
	2.2 [Reserved]
	 	 	5	 
	2.3 Borrowing Procedures and Settlements
	 	 	5	 
	2.4 Payments; Reductions and Increases of Commitments; Prepayments
	 	 	11	 
	2.5 Overadvances
	 	 	18	 
	2.6 Interest Rates and Letter of Credit Fee: Rates, Payments, and Calculations
	 	 	19	 
	2.7 Crediting Payments
	 	 	20	 
	2.8 Designated Account
	 	 	21	 
	2.9 Maintenance of Loan Account; Statements of Obligations
	 	 	21	 
	2.10 Fees
	 	 	21	 
	2.11 Letters of Credit
	 	 	22	 
	2.12 LIBOR Option
	 	 	26	 
	2.13 Capital Requirements
	 	 	28	 
	2.14 Appointment of Administrative Borrower as Agent for Requesting Loans and
Receipts of Loans and Statements
	 	 	29	 
	2.15 Conversion of Guarantors to Borrower
	 	 	30	 
	 
	 	 	 	 
	3. CONDITIONS; TERM OF AGREEMENT
	 	 	30	 
	 
	 	 	 	 
	3.1 Conditions Precedent to the Initial Extension of Credit
	 	 	30	 
	3.2 Conditions Precedent to all Extensions of Credit
	 	 	30	 
	3.3 Maturity
	 	 	31	 
	3.4 Effect of Maturity
	 	 	31	 
	3.5 Early Termination by Borrowers
	 	 	31	 
	 
	 	 	 	 
	4. REPRESENTATIONS AND WARRANTIES
	 	 	31	 
	 
	 	 	 	 
	4.1 Due Organization and Qualification; Subsidiaries
	 	 	31	 
	4.2 Due Authorization; No Conflict
	 	 	32	 
	4.3 Governmental Consents
	 	 	33	 
	4.4 Binding Obligations; Perfected Liens
	 	 	33	 
	4.5 Title to Assets; No Encumbrances
	 	 	33	 
	4.6 Jurisdiction of Organization; Location of Chief Executive Office;
Organizational Identification Number; Commercial Tort Claims
	 	 	34	 






i









 






	 	 	 	 	 
	 	 	Page	 
	4.7 Litigation
	 	 	34	 
	4.8 Compliance with Laws
	 	 	34	 
	4.9 No Material Adverse Change
	 	 	35	 
	4.10 Fraudulent Transfer
	 	 	35	 
	4.11 Employee Benefits
	 	 	35	 
	4.12 Environmental Condition
	 	 	35	 
	4.13 Intellectual Property
	 	 	36	 
	4.14 Leases
	 	 	36	 
	4.15 Deposit Accounts and Securities Accounts
	 	 	36	 
	4.16 Complete Disclosure
	 	 	36	 
	4.17 Material Contracts
	 	 	37	 
	4.18 Patriot Act
	 	 	37	 
	4.19 Reserved
	 	 	37	 
	4.20 Payment of Taxes
	 	 	37	 
	4.21 Margin Equity Interests
	 	 	37	 
	4.22 Governmental Regulation
	 	 	38	 
	4.23 OFAC
	 	 	38	 
	4.24 Employee and Labor Matters
	 	 	38	 
	4.25 Term Loan Documents; Equity Contribution Documents
	 	 	38	 
	4.26 Confirmation Order
	 	 	39	 
	4.27 Eligible Accounts
	 	 	39	 
	4.28 Eligible Inventory
	 	 	40	 
	4.29 Locations of Inventory and Equipment
	 	 	40	 
	4.30 Inventory Records
	 	 	40	 
	4.31 Replacement Revolving Facility
	 	 	40	 
	 
	 	 	 	 
	5. AFFIRMATIVE COVENANTS
	 	 	40	 
	 
	 	 	 	 
	5.1 Financial Statements, Reports, Certificates
	 	 	40	 
	5.2 Collateral Reporting
	 	 	40	 
	5.3 Existence
	 	 	40	 
	5.4 Maintenance of Properties
	 	 	41	 
	5.5 Taxes
	 	 	41	 
	5.6 Insurance
	 	 	41	 
	5.7 Inspection
	 	 	41	 
	5.8 Compliance with Laws
	 	 	42	 
	5.9 Environmental
	 	 	42	 
	5.10 Disclosure Updates
	 	 	43	 
	5.11 Formation of Subsidiaries
	 	 	43	 
	5.12 Further Assurances
	 	 	43	 
	5.13 Lender Meetings
	 	 	44	 
	5.14 Material Contracts
	 	 	44	 
	5.15 Location of Inventory and Equipment
	 	 	44	 
	5.16 Dissolution of Triple S EMC
	 	 	44	 
	5.17 Conduct of Tronox Funding
	 	 	44	 
	5.18 Bills of Lading and Other Documents of Title.
	 	 	45	 
	5.19 Consignment Agreements
	 	 	45	 






ii









 






	 	 	 	 	 
	 	 	Page	 
	6. NEGATIVE COVENANTS
	 	 	45	 
	 
	 	 	 	 
	6.1 Indebtedness
	 	 	46	 
	6.2 Liens
	 	 	46	 
	6.3 Restrictions on Fundamental Changes
	 	 	46	 
	6.4 Disposal of Assets
	 	 	46	 
	6.5 Change Name
	 	 	47	 
	6.6 Nature of Business
	 	 	47	 
	6.7 Prepayments and Amendments
	 	 	47	 
	6.8 Change of Control
	 	 	48	 
	6.9 Restricted Junior Payments
	 	 	48	 
	6.10 Accounting Methods
	 	 	48	 
	6.11 Investments; Controlled Investments
	 	 	48	 
	6.12 Transactions with Affiliates
	 	 	49	 
	6.13 Use of Proceeds
	 	 	49	 
	6.14 Limitation on Issuance of Equity Interests
	 	 	50	 
	6.15 Sales and Lease Backs
	 	 	50	 
	6.16 Certain Deposit Accounts
	 	 	50	 
	 
	 	 	 	 
	7. FINANCIAL COVENANTS
	 	 	50	 
	 
	 	 	 	 
	8. EVENTS OF DEFAULT
	 	 	51	 
	 
	 	 	 	 
	9. RIGHTS AND REMEDIES
	 	 	53	 
	 
	 	 	 	 
	9.1 Rights and Remedies
	 	 	53	 
	9.2 Remedies Cumulative
	 	 	54	 
	 
	 	 	 	 
	10. WAIVERS; INDEMNIFICATION
	 	 	54	 
	 
	 	 	 	 
	10.1 Demand; Protest; etc
	 	 	54	 
	10.2 The Lender Group’s Liability for Collateral
	 	 	54	 
	10.3 Indemnification
	 	 	54	 
	 
	 	 	 	 
	11. NOTICES
	 	 	55	 
	 
	 	 	 	 
	12. CHOICE OF LAW AND VENUE; JURY TRIAL WAIVER
	 	 	56	 
	 
	 	 	 	 
	13. ASSIGNMENTS AND PARTICIPATIONS; SUCCESSORS
	 	 	57	 
	 
	 	 	 	 
	13.1 Assignments and Participations
	 	 	57	 
	13.2 Successors
	 	 	60	 
	 
	 	 	 	 
	14. AMENDMENTS; WAIVERS
	 	 	60	 






iii









 






	 	 	 	 	 
	 	 	Page	 
	14.1 Amendments and Waivers
	 	 	60	 
	14.2 Replacement of Certain Lenders
	 	 	63	 
	14.3 No Waivers; Cumulative Remedies
	 	 	63	 
	 
	 	 	 	 
	15. AGENT; THE LENDER GROUP
	 	 	64	 
	 
	 	 	 	 
	15.1 Appointment and Authorization of Agent
	 	 	64	 
	15.2 Delegation of Duties
	 	 	65	 
	15.3 Liability of Agent
	 	 	65	 
	15.4 Reliance by Agent
	 	 	65	 
	15.5 Notice of Default or Event of Default
	 	 	65	 
	15.6 Credit Decision
	 	 	66	 
	15.7 Costs and Expenses; Indemnification
	 	 	66	 
	15.8 Agent in Individual Capacity
	 	 	67	 
	15.9 Successor Agent
	 	 	67	 
	15.10 Lender in Individual Capacity
	 	 	68	 
	15.11 Collateral Matters
	 	 	68	 
	15.12 Restrictions on Actions by Lenders; Sharing of Payments
	 	 	69	 
	15.13 Agency for Perfection
	 	 	70	 
	15.14 Payments by Agent to the Lenders
	 	 	70	 
	15.15 Concerning the Collateral and Related Loan Documents
	 	 	70	 
	15.16 Audits and Examination Reports; Confidentiality; Disclaimers by Lenders; Other
Reports and Information
	 	 	71	 
	15.17 Several Obligations; No Liability
	 	 	72	 
	 
	 	 	 	 
	16. TAXES
	 	 	72	 
	 
	 	 	 	 
	17. GENERAL PROVISIONS
	 	 	75	 
	 
	 	 	 	 
	17.1 Effectiveness
	 	 	75	 
	17.2 Section Headings
	 	 	75	 
	17.3 Interpretation
	 	 	75	 
	17.4 Severability of Provisions
	 	 	75	 
	17.5 Bank Product Providers
	 	 	75	 
	17.6 Debtor-Creditor Relationship
	 	 	76	 
	17.7 Counterparts; Electronic Execution
	 	 	77	 
	17.8 Revival and Reinstatement of Obligations
	 	 	77	 
	17.9 Confidentiality
	 	 	77	 
	17.10 Lender Group Expenses
	 	 	78	 
	17.11 Survival
	 	 	78	 
	17.12 USA PATRIOT Act
	 	 	78	 
	17.13 Integration
	 	 	79	 
	17.14 Ex-Im Bank Rules
	 	 	79	 






iv









 






EXHIBITS AND SCHEDULES




	 	 	 	 	 

	Exhibit A-1	 	Form of Assignment and Acceptance

	 	 	 	 	 

	Exhibit B-1	 	Form of Borrowing Base Certificate

	 	 	 	 	 

	Exhibit B-2	 	Form of Ex-Im Borrowing Base Certificate

	 	 	 	 	 

	Exhibit B-3	 	Form of Bank Products Provider Letter Agreement

	 	 	 	 	 

	Exhibit C-1	 	Form of Compliance Certificate

	 	 	 	 	 

	Exhibit D-1	 	Form of Export-Related Revolving Credit Note

	 	 	 	 	 

	Exhibit E-1	 	Form of Guarantor Conversion Notice

	 	 	 	 	 

	Exhibit L-1	 	Form of LIBOR Notice

	 	 	 	 	 

	Schedule A-1	 	Agent’s Account

	 	 	 	 	 

	Schedule A-2	 	Authorized Persons

	 	 	 	 	 

	Schedule C-1	 	Commitments

	 	 	 	 	 

	Schedule D-1	 	Designated Account

	 	 	 	 	 

	Schedule E-1	 	Inventory Locations

	 	 	 	 	 

	Schedule E-2	 	Existing Letters of Credit

	 	 	 	 	 

	Schedule E-3	 	Excluded Transferees

	 	 	 	 	 

	Schedule E-4	 	Eligible Mexican Account Requirements

	 	 	 	 	 

	Schedule F-1	 	Freight Forwarders

	 	 	 	 	 

	Schedule N-1	 	Non-Core Real Estate Assets

	 	 	 	 	 

	Schedule P-1	 	Permitted Investments

	 	 	 	 	 

	Schedule P-2	 	Permitted Liens

	 	 	 	 	 

	Schedule P-3	 	Permitted Indebtedness

	 	 	 	 	 

	Schedule P-4	 	Permitted Holders

	 	 	 	 	 

	Schedule 1.1	 	Definitions







v









 






	 	 	 	 	 

	Schedule 3.1	 	Conditions Precedent

	 	 	 	 	 

	Schedule 4.1(b)	 	Capitalization of Loan Parties

	 	 	 	 	 

	Schedule 4.1(c)	 	Capitalization of Loan Parties’ Subsidiaries

	 	 	 	 	 

	Schedule 4.6(a)	 	Jurisdictions of Organization

	 	 	 	 	 

	Schedule 4.6(b)	 	Chief Executive Offices

	 	 	 	 	 

	Schedule 4.6(c)	 	Organizational Identification Numbers

	 	 	 	 	 

	Schedule 4.6(d)	 	Commercial Tort Claims

	 	 	 	 	 

	Schedule 4.7(b)	 	Litigation

	 	 	 	 	 

	Schedule 4.11	 	Benefit Plans

	 	 	 	 	 

	Schedule 4.13	 	Intellectual Property

	 	 	 	 	 

	Schedule 4.15	 	Deposit Accounts and Securities Accounts

	 	 	 	 	 

	Schedule 4.17	 	Material Contracts

	 	 	 	 	 

	Schedule 4.29	 	Locations of Inventory and Equipment

	 	 	 	 	 

	Schedule 5.1	 	Financial Statements, Reports, Certificates

	 	 	 	 	 

	Schedule 5.2	 	Collateral Reporting

	 	 	 	 	 

	Schedule 6.12	 	Affiliate Transactions








vi











 





CREDIT AGREEMENT




     THIS CREDIT AGREEMENT (this “Agreement”), is entered into as of February 14, 2011 by and among
the lenders identified on the signature pages hereof (each of such lenders, together with their
respective successors and permitted assigns, are referred to hereinafter as a “Lender” or a “US
Lender”, as that term is hereinafter further defined), Wells Fargo Capital Finance, LLC, a Delaware
limited liability company, as agent for the Lenders (in such capacity, together with its successors
and assigns in such capacity, “Agent”), Tronox LLC, a Delaware limited liability company (“Tronox”
or a “US Borrower” as hereinafter further defined), Tronox Incorporated, a Delaware corporation
(“Parent”), Tronox Worldwide LLC, a Delaware limited liability company (“Worldwide”), Tronox
Finance Corp., a Delaware corporation (“Finance”), Cimarron Corporation, an Oklahoma corporation
(“Cimmaron”), Triple S Refining Corporation, a Delaware corporation (“Triple S Refining”),
Southwestern Refining Company, Inc., a Delaware corporation (“Southwestern”), Triangle Refineries,
Inc., a Delaware corporation (“Triangle”), Transworld Drilling Company, a Delaware corporation
(“Transworld”), Triple S Minerals Resources Corporation, a Delaware corporation (“Triple S
Minerals”), Triple S, Inc., an Oklahoma corporation (“Triple S”), Tronox Holdings, Inc., a Delaware
corporation (“Holdings”), and Tronox Pigments (Savannah) Inc., a Georgia corporation (“Pigments”
and, together with Parent, Worldwide, Finance, Cimmaron, Triple S Refining, Southwestern, Triangle,
Transworld, Triple S Minerals, Triple S and Holdings, individually each, a “Guarantor” and
collectively, “Guarantors” as hereinafter further defined).



     The parties agree as follows:


1. DEFINITIONS AND CONSTRUCTION.




     1.1 Definitions. Capitalized terms used in this Agreement shall have the meanings
specified therefor on Schedule 1.1.



     1.2 Accounting Terms. 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 unqualified and 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. When used herein, the term “financial
statements” shall include the notes and schedules thereto. Whenever the term “Parent” is used in
respect of a financial covenant or a related definition, it shall be understood to mean Parent and
its Subsidiaries on a consolidated basis, unless the context clearly requires otherwise.



     1.3 UCC. Any terms used in this Agreement that are defined in the UCC shall be
construed and defined as set forth in the UCC unless otherwise defined herein; provided,
however,



 









 




that to the extent that the UCC is used to define any term herein and such term is
defined differently in different Articles of the UCC, the definition of such term contained in
Article 9 of the UCC shall govern.




     1.4 Construction. Unless the context of this Agreement or any other Loan Document
clearly requires otherwise, references to the plural include the singular, references to the
singular include the plural, the terms “includes” and “including” are not limiting, and the term
“or” has, except where otherwise indicated, the inclusive meaning represented by the phrase
“and/or.” The words “hereof,” “herein,” “hereby,” “hereunder,” and similar terms in this Agreement
or any other Loan Document refer to this Agreement or such other Loan Document, as the case may be,
as a whole and not to any particular provision of this Agreement or such other Loan Document, as
the case may be. Section, subsection, clause, schedule, and exhibit references herein are to this
Agreement unless otherwise specified. Any reference in this Agreement or in any other Loan
Document to any agreement, instrument, or document shall include all alterations, amendments,
changes, extensions, modifications, renewals, replacements, substitutions, joinders, and
supplements, thereto and thereof, as applicable (subject to any restrictions on such alterations,
amendments, changes, extensions, modifications, renewals, replacements, substitutions, joinders,
and supplements set forth herein). The words “asset” and “property” shall be construed to have the
same meaning and effect and to refer to any and all tangible and intangible assets and properties,
including cash, securities, accounts, and contract rights. Any reference herein or in any other
Loan Document to the satisfaction, repayment, or payment in full of the Obligations , the Secured
Obligations (as defined in the Security Agreement) or the Guaranteed Obligations (as defined in the
Guaranty) shall mean the repayment in Dollars in full in cash or immediately available funds (or,
(a) in the case of contingent reimbursement obligations with respect to Letters of Credit,
providing Letter of Credit Collateralization, and (b) in the case of obligations with respect to
Bank Products (other than Hedge Obligations), providing Bank Product Collateralization) of all of
the Obligations (including the payment of any termination amount then applicable (or which would or
could become applicable as a result of the repayment of the other Obligations) under Hedge
Agreements provided by Hedge Providers) other than (i) unasserted indemnification Obligations, (ii)
any Bank Product Obligations (other than Hedge Obligations) that, at such time, are allowed by the
applicable Bank Product Provider to remain outstanding without being required to be repaid or cash
collateralized or otherwise are contingent, and (iii) any Hedge Obligations that, at such time, are
allowed by the applicable Hedge Provider to remain outstanding without being required to be repaid
or are contingent or not yet due. Any reference herein to any Person shall be construed to include
such Person’s successors and assigns. Any requirement of a writing contained herein or in any
other Loan Document shall be satisfied by the transmission of a Record. All references to
Borrowers, Guarantors, Agent, and Lenders pursuant to the definitions set forth in the recitals
hereto or Schedule 1.1 hereto, or to any other person herein or therein, shall include
their respective successors and assigns. An Event of Default shall exist or continue or be
continuing until such Event of Default is waived in accordance with Section 14.1 or is cured, if
such Event of Default is capable of being cured. 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. Unless otherwise indicated herein, all
references to time of day refer to Eastern Standard Time or Eastern daylight saving time, as in
effect in New York City on such day. In the computation



2









 




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”. This Agreement and other Loan Documents 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.
This Agreement and the other Loan Documents 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 Loan Documents shall not be construed against Agent or
Lenders merely because of Agent’s or any Lender’s involvement in their preparation. Unless the
context of this Agreement or any other Loan Document clearly requires otherwise or Agent otherwise
determines, amounts expressed in US Dollars at any time when used with respect to Foreign
Subsidiaries or similar matters shall be deemed to mean the US Dollar Equivalent of such amounts at
such time.




     1.5 Schedules and Exhibits. All of the schedules and exhibits attached to this
Agreement shall be deemed incorporated herein by reference.


2. LOANS AND TERMS OF PAYMENT.




     2.1 Revolver Advances



          (a) Subject to the terms and conditions of this Agreement, and during the period from the date
hereof until the Maturity Date, each US Lender with a US Revolver Commitment agrees (severally, not
jointly or jointly and severally) to make revolving loans (“US Advances”) to US Borrowers which in
the aggregate at any one time outstanding will not exceed the lesser of:




          
     (i) such US Lender’s US Revolver Commitment, or



          
     (ii) such US Lender’s Pro Rata Share of an amount equal to the lesser of:



          
          (A) the Maximum US Revolver Amount less the sum of (1) the US Letter of Credit Usage at such
time, plus (2) the principal amount of Swing Line Loans outstanding at such time, and



          
          (B) the US Borrowing Base at such time less the sum of
(1) the US Letter of Credit Usage at
such time, plus (2) the principal amount of Swing Line Loans outstanding at such time;
provided, that, in no event shall any Lender be required to make an Advance if it
would cause the sum of US Revolver Usage and Ex-Im Revolver Usage at any time to exceed the Maximum
Revolver Amount at such time.



          
(b) Subject to the terms and conditions of this Agreement, and during the period from the date
hereof until the Ex-Im Maturity Date, each US Lender with an Ex-Im Revolver Commitment agrees
(severally, not jointly or jointly and severally) to make revolving loans (“Ex-Im Advances”) to US
Borrowers which in the aggregate at any one time outstanding will not exceed the lesser of:



         
      (i) such US Lender’s Ex-Im Revolver Commitment, or



3









 






         
      (ii) such US Lender’s Pro Rata Share of an amount equal to the lesser of:



         
           (A) the Maximum Ex-Im Revolver Amount at such time, and



         
           (B) the Ex-Im Borrowing Base at such time; provided, that, in no event shall
any Lender be required to make an Advance if it would cause the sum of US Revolver Usage and Ex-Im
Revolver Usage at any time to exceed the Maximum Revolver Amount at such time.



         
 (c) Amounts borrowed pursuant to this Section 2.1 may be repaid and, subject to the terms and
conditions of this Agreement, reborrowed at any time and from time to time during the term of this
Agreement. The outstanding principal amount of the Advances (other than the Ex-Im Advances),
together with interest and fees accrued on such Advances, shall be due and payable on the Maturity
Date or, if earlier, on the date on which they are declared due and payable pursuant to the terms
of this Agreement. The outstanding principal amount of the Ex-Im Advances, together with interest
and fees accrued thereon, shall be due and payable on the Ex-Im Maturity Date or, if earlier, on
the date on which they are declared due and payable pursuant to the terms of this Agreement.




        
  (d) Anything to the contrary in the Loan Documents notwithstanding (but subject to the
immediately succeeding sentence), Agent shall have the right (but not the obligation) to establish,
increase, reduce, eliminate, or otherwise adjust reserves from time to time against the US
Borrowing Base, and/or the Ex-Im Borrowing Base in such amounts, and with respect to such matters,
as Agent in its Permitted Discretion shall deem necessary or appropriate, but in all cases without
duplication, including, without limitation (i) reserves in an amount equal to the Bank Product
Reserve Amount, (ii) reserves with respect to (A) amounts that Parent or its Subsidiaries are
required to pay under any Section of this Agreement or any other Loan Document and which Parent and
its Subsidiaries fail to pay when due and or (B) the amount of Priority Payables due and payable,
(iii) reserves in respect of amounts owing to the landlord, warehouseman or other operator of any
property at which any Revolving Loan Priority Collateral is located but for which Agent has not
received a Collateral Access Agreement; provided, that, the amount of the reserve
for any such property shall not exceed three (3) months of mortgage, rental or similar payments
payable by the Loan Parties for such property and, if a default under the applicable lease or other
agreement by the Loan Parties exists, an amount equal to the amounts due and payable under such
lease or other agreement (except that any of the foregoing amounts under this clause (iii) shall
from time to time (A) be eliminated with respect to a property upon the receipt by the Agent of a
Collateral Access Agreement for such property, (B) be adjusted upon the opening or closing of a
Collateral location subject to the limits described above, or (C) be adjusted upon any change
actually known to Agent in the amount of rental, mortgage or similar payments subject to the limits
described above), and (iv) reserves in respect of the amounts then due and owing to NGE under the
NGE Agreement; provided, that, the amount of such reserve under this clause (iv)
shall not exceed one month of servicing fees payable to NGE under the NGE Agreement and, if a
default under the NGE Agreement exists, an amount equal to the amounts due and payable to NGE under
the NGE Agreement; provided, further, that, any reserve established under
this clause (iv) shall be released promptly upon Agent’s receipt of reasonably satisfactory
evidence that Agent shall have received an aggregate amount of Environmental Insurance Receivables
Prepayments equal to the lesser of (A) 80% of the Eligible Insurance Accounts in existence on the
Closing Date or (B) $20,000,000. In each case such reserves shall be established against the US
Borrowing Base and/or the Ex-Im Borrowing Base (but without




4









 







duplication of any such reserves), and
to the extent that a reserve is in respect of amounts that may be payable to third parties, Agent
may, in its Permitted Discretion, deduct such reserve from the
Maximum US Revolver Amount and/or the Maximum Ex-Im Revolver Amount (but without any
duplication). To the extent an event, circumstance or otherwise is addressed in (or a deduction is
taken pursuant to) the definitions of Eligible Accounts, Eligible Inventory or Eligible Insurance
Accounts, Agent shall not establish a reserve for the same purpose.




          (e) Except in Agent’s discretion and with the consent of all Lenders, the aggregate amount of
the US Advances and Letters of Credit outstanding at any time (i) based on Eligible Inventory
consisting of work in process shall not exceed $5,000,000, (ii) based on Eligible Inventory
consisting of chemicals used or consumed in the manufacturing of inventory shall not exceed
$5,000,000, (iii) based on Eligible Inventory consisting of consigned inventory (including, without
limitation, consigned inventory in the possession of a consignee, consigned inventory in transit to
a consignee or any other consigned inventory) shall not exceed $12,500,000, (iv) based on Eligible
Inventory consisting of Eligible In-Transit Inventory shall not exceed $12,500,000, (v) based on
Eligible Ex-Im Accounts owing by Account Debtors located in Mexico shall not exceed $20,000,000,
and (v) based on Eligible Ex-Im Accounts owing by Account Debtors located in any country (other
than the United States, Canada or Mexico) shall not exceed $5,000,000.




     2.2 [Reserved]




     2.3 Borrowing Procedures and Settlements.




          (a) Procedure for Borrowing. Each Borrowing shall be made by a written request by an
Authorized Person delivered to Agent. Unless Swing Line Lender is not obligated to make a Swing
Line Loan pursuant to Section 2.3(b) below, such notice must be received by Agent no later than
1:00 p.m. on the Business Day that is the requested Funding Date specifying (i) the amount of such
Borrowing, and (ii) the requested Funding Date, which shall be a Business Day; provided,
however, that if Swing Line Lender is not obligated to make a Swing Line Loan as to
a requested Borrowing, such notice must be received by Agent no later than 11:00 a.m. on the
Business Day prior to the date that is the requested Funding Date. At Agent’s election, in lieu of
delivering the above-described written request, any Authorized Person may give Agent telephonic
notice of such request by the required time. In such circumstances, Administrative Borrower agrees
that any such telephonic notice will be confirmed in writing within twenty-four (24) hours of the
giving of such telephonic notice, but the failure to provide such written confirmation shall not
affect the validity of the request.




          (b) Making of Swing Line Loans. In the case of a request for a US Advance and so long as
either (i) the aggregate amount of Swing Line Loans made since the last Settlement Date, minus the
amount of Collections or payments applied to Swing Line Loans since the last Settlement Date, plus
the amount of the requested US Advance does not exceed $5,000,000, or (ii) Swing Line Lender, in
its sole discretion, shall agree to make a Swing Line Loan notwithstanding the foregoing
limitation, Swing Line Lender shall make a US Advance in the amount of such requested Borrowing
(any such US Advance made solely by Swing Line Lender pursuant to this Section 2.3(b) being
referred to as a “Swing Line Loan” and such US Advances being referred to as “Swing Line Loans”)
available to US Borrowers on the Funding Date applicable thereto by transferring immediately
available funds to the Designated Account. Anything contained herein to the contrary






5









 







notwithstanding, the Swing Line Lender may, but shall not be obligated to, make Swing Line Loans at
any time that one or more of the Lenders is a Defaulting Lender. Each Swing Line Loan shall be
deemed to be a US Advance hereunder and shall be subject to all the terms and conditions
(including Section 3) applicable to other US Advances; except, that, all payments
on any Swing Line Loan shall be payable to Swing Line Lender solely for its own account. Subject
to the provisions of Section 2.3(d)(ii), Swing Line Lender shall not make and shall not be
obligated to make any Swing Line Loan if Swing Line Lender has actual knowledge that (A) one or
more of the applicable conditions precedent set forth in Section 3.1 or 3.2 has not been satisfied
or would not be satisfied immediately after giving effect to such Swing Line Loan, or (B) the
requested Borrowing would exceed the Availability on the requested Funding Date for the applicable
Borrowing. Swing Line Lender shall not otherwise be required to determine whether the applicable
conditions precedent set forth in Section 3 have been satisfied on the Funding Date applicable
thereto prior to making any Swing Line Loan. The Swing Line Loans shall be secured by Agent’s
Liens, constitute US Advances and Obligations hereunder, and bear interest at the rate applicable
from time to time to US Advances that are Base Rate Loans.




          (c) Making of Loans.




               (i) In the event that Swing Line Lender is not obligated to make a Swing Line Loan, then
promptly after receipt of a request for a Borrowing pursuant to Section 2.3(a), Agent shall notify
the Lenders, not later than 1:00 p.m. on the Business Day immediately preceding the Funding Date
applicable thereto, by telecopy, telephone, or other similar form of transmission, of the requested
Borrowing. Each Lender shall make the amount of such Lender’s Pro Rata Share of the requested
Borrowing available to Agent in immediately available funds, to Agent’s Account, not later than
10:00 a.m. on the Funding Date applicable thereto. After Agent’s receipt of the proceeds of such
Advances, Agent shall make the proceeds thereof available to Borrowers on the applicable Funding
Date by transferring immediately available funds equal to such proceeds received by Agent to the
Designated Account; provided, however, that subject to the provisions of Section
2.3(d)(ii), Agent shall not request any Lender to make, and no Lender shall have the obligation to
make, any Advance if (A) one or more of the applicable conditions precedent set forth in Section
3.1 or 3.2 has not been satisfied or would not be satisfied immediately after giving effect to such
Advance unless such condition has been waived, or (B) the requested Borrowing would exceed the
Availability on the requested Funding Date for the applicable Borrowing.



               (ii) Unless Agent receives notice from a Lender prior to 9:00 a.m. on the date of a Borrowing,
that such Lender will not make available as and when required hereunder to Agent for the account of
Borrowers the amount of that Lender’s Pro Rata Share of the Borrowing, Agent may assume that each
Lender has made or will make such amount available to Agent in immediately available funds on the
Funding Date and Agent may (but shall not be so required), in reliance upon such assumption, make
available to Borrowers on such date a corresponding amount. If any Lender shall not have made its
full amount available to Agent in immediately available funds and if Agent in such circumstances
has made available to Borrowers such amount, that Lender shall on the Business Day following such
Funding Date make such amount available to Agent, together with interest at the Defaulting Lender
Rate for each day during such period. A notice submitted by Agent to any Lender with respect to
amounts owing under this Section 2.3(c)(ii) shall be conclusive, absent manifest error. If such
amount is so made available, such payment to Agent shall constitute such Lender’s Advance on the
date of Borrowing for all purposes of this Agreement. If such amount is not made



6









 




available to Agent on the Business Day following the Funding Date, Agent will notify Administrative Borrower of
such failure to fund and, upon demand by Agent, Borrowers shall pay
such amount to Agent for Agent’s account, together with interest thereon for each day elapsed
since the date of such Borrowing, at a rate per annum equal to the interest rate applicable at the
time to the Advances composing such Borrowing.




          (d) Protective Advances and Optional Overadvances.




               (i) Any contrary provision of this Agreement or any other Loan Document notwithstanding, but
subject to Section 2.3(d)(iv), Agent hereby is authorized by the Lenders, from time to time in
Agent’s sole discretion, (A) after the occurrence and during the continuance of an Event of
Default, or (B) upon notice to Administrative Borrower at any time that any of the other applicable
conditions precedent set forth in Section 3 are not satisfied, to make Advances to, or for the
benefit of, Borrowers on behalf of the Lenders that Agent, in its Permitted Discretion deems
necessary or desirable (1) to preserve or protect the Collateral, or any portion thereof, or (2) to
enhance the likelihood of repayment of the Obligations (other than the Bank Product Obligations,
including Hedge Obligations) (any of the Advances described in this Section 2.3(d)(i) shall be
referred to as “Protective Advances”).



               (ii) Any contrary provision of this Agreement or any other Loan Document notwithstanding, but
subject to Section 2.3(d)(iv), the Lenders hereby authorize Agent or Swing Line Lender, as
applicable, and either Agent or Swing Line Lender, as applicable, may, but is not obligated to,
knowingly and intentionally, continue to make Advances (including Swing Line Loans) to Borrowers
notwithstanding that an Overadvance exists or thereby would be created, so long as (A) after giving
effect to such Advances, the outstanding US Revolver Usage does not exceed the US Borrowing Base by
more than ten (10%) percent of the Maximum Revolver Amount, (B) after giving effect to such
Advances, the outstanding US Revolver Usage (except for and excluding amounts charged to the Loan
Account for interest, fees, or Lender Group Expenses) does not exceed the Maximum US Revolver
Amount, (C) after giving effect to such Advances, the outstanding Ex-Im Revolver Usage does not
exceed the Ex-Im Borrowing Base and (D) after giving effect to such Advances, the outstanding Ex-Im
Revolver Usage (except for and excluding amounts charged to the Loan Account for interest, fees, or
Lender Group Expenses) does not exceed the Maximum Ex-Im Revolver Amount. In the event Agent
obtains actual knowledge that the Ex-Im Revolver Usage or the US Revolver Usage exceeds the amounts
permitted by the immediately foregoing provisions, regardless of the amount of, or reason for, such
excess, Agent shall notify the Lenders as soon as practicable (and prior to making any (or any
additional) intentional Overadvances (except for and excluding amounts charged to the Loan Account
for interest, fees, or Lender Group Expenses) unless Agent determines that prior notice would
result in imminent harm to the Collateral or its value, in which case Agent may make such
Overadvances and provide notice as promptly as practicable thereafter), and the Lenders with
Revolver Commitments thereupon shall, together with Agent, jointly determine the terms of
arrangements that shall be implemented with Borrowers intended to reduce, within a reasonable time,
the outstanding principal amount of the Advances to Borrowers to an amount permitted by the
preceding sentence. In such circumstances, if any Lender with a Revolver Commitment objects to the
proposed terms of reduction or repayment of any Overadvance, the terms of reduction or repayment
thereof shall be implemented according to the determination of the Required Lenders. In any event:
(1) if any unintentional Overadvance remains outstanding for more than sixty (60) days, unless
otherwise agreed to by the Required Lenders, Borrowers shall



7









 




immediately repay Advances in an
amount sufficient to eliminate all such unintentional Overadvances, and (2) after the date all such
Overadvances have been eliminated, there must be at
least five (5) consecutive days before intentional Overadvances are made unless otherwise
agreed to by the Required Lenders. The foregoing provisions are meant for the benefit of the
Lenders and Agent and are not meant for the benefit of Borrowers, which shall continue to be bound
by the provisions of Section 2.5. Each Lender with a Revolver Commitment shall be obligated to
settle with Agent as provided in Section 2.3(e) (or Section 2.3(g), as applicable) for the amount
of such Lender’s Pro Rata Share of any unintentional Overadvances by Agent reported to such Lender,
any intentional Overadvances made as permitted under this Section 2.3(d)(ii), and any Overadvances
resulting from the charging to the Loan Account of interest, fees, or Lender Group Expenses.




               (iii) Each Protective Advance and each Overadvance shall be deemed to be an Advance hereunder;
except, that, no Protective Advance or Overadvance shall be eligible to be a LIBOR
Rate Loan and, prior to Settlement therefor, all payments on the Protective Advances shall be
payable to Agent solely for its own account. The Protective Advances and Overadvances shall be
secured by Agent’s Liens, constitute Obligations hereunder, and bear interest at the rate
applicable from time to time to Advances that are Base Rate Loans. If an Event of Default has
occurred and is continuing, Protective Advances shall be repayable on demand. Overadvances shall
be repayable in accordance with the terms of Section 2.5. The ability of Agent to make Protective
Advances is separate and distinct from its ability to make Overadvances and its ability to make
Overadvances is separate and distinct from its ability to make Protective Advances. For the
avoidance of doubt, the limitations on Agent’s ability to make Protective Advances do not apply to
Overadvances and the limitations on Agent’s ability to make Overadvances do not apply to Protective
Advances. The provisions of this Section 2.3(d) are for the exclusive benefit of Agent, Swing Line
Lender, and the Lenders and are not intended to benefit Borrowers in any way.



               (iv) Notwithstanding anything contained in this Agreement or any other Loan Document to the
contrary: (A) no Overadvance or Protective Advance may be made by Agent if such Advance would
cause the aggregate principal amount of Overadvances and Protective Advances outstanding to exceed
an amount equal to ten (10%) percent of the Maximum Revolver Amount; and (B) to the extent any
Protective Advance causes the aggregate US Revolver Usage to exceed the Maximum US Revolver Amount
or causes the aggregate Ex-Im Revolver Usage to exceed the Maximum Ex-Im Revolver Amount, each such
Protective Advance shall be for Agent’s sole and separate account and not for the account of any
Lender and shall be entitled to priority in repayment in accordance with Section 2.4(b).



          (e) Settlement. It is agreed that each US Lender’s funded portion of the US Advances to US
Borrowers is intended by the US Lenders to equal, at all times, such US Lender’s Pro Rata Share of
the outstanding US Advances. It is agreed that each US Lender’s funded portion of the Ex-Im
Advances intended by the US Lenders to equal, at all times, such US Lender’s Pro Rata Share of the
outstanding Ex-Im Advances. Such agreement notwithstanding, Agent, Swing Line Lender, and the
other Lenders agree (which agreement shall not be for the benefit of Borrowers) that in order to
facilitate the administration of this Agreement and the other Loan Documents, settlement among the
Lenders as to the Advances, the Swing Line Loans, and the Protective Advances shall take place on a
periodic basis in accordance with the following provisions:







8









 








               (i) Agent shall request settlement (“Settlement”) with the Lenders on a weekly basis, or on a
more frequent basis if so determined by Agent (A) on behalf of Swing Line Lender, with respect to
the outstanding Swing Line Loans, (B) for itself, with respect to the outstanding
Protective Advances, and (C) with respect to Borrowers’ or their Subsidiaries’ Collections or
payments received, as to each by notifying the Lenders by telecopy, telephone, or other similar
form of transmission, of such requested Settlement, no later than 2:00 p.m. on the Business Day
immediately prior to the date of such requested Settlement (the date of such requested Settlement
being the “Settlement Date”). Such notice of a Settlement Date shall include a summary statement
of the amount of outstanding Advances, Swing Line Loans, and Protective Advances for the period
since the prior Settlement Date. Subject to the terms and conditions contained herein (including
Section 2.3(g)): (1) if the amount of the Advances (including Swing Line Loans and Protective
Advances) made by a Lender that is not a Defaulting Lender exceeds such Lender’s Pro Rata Share of
the Advances (including Swing Line Loans and Protective Advances) as of a Settlement Date, then
Agent shall, by no later than 12:00 p.m. on the Settlement Date, transfer in immediately available
funds to a Deposit Account of such Lender (as such Lender may designate), an amount such that each
such Lender shall, upon receipt of such amount, have as of the Settlement Date, its Pro Rata Share
of the Advances (including Swing Line Loans and Protective Advances), and (2) if the amount of the
Advances (including Swing Line Loans and Protective Advances) made by a Lender is less than such
Lender’s Pro Rata Share of the Advances (including Swing Line Loans and Protective Advances) as of
a Settlement Date, such Lender shall no later than 12:00 p.m. on the Settlement Date transfer in
immediately available funds to Agent’s Account, an amount such that each such Lender shall, upon
transfer of such amount, have as of the Settlement Date, its Pro Rata Share of the Advances
(including Swing Line Loans and Protective Advances). Such amounts made available to Agent under
clause (2) of the immediately preceding sentence shall be applied against the amounts of the
applicable Swing Line Loans or Protective Advances and, together with the portion of such Swing
Line Loans or Protective Advances representing Swing Line Lender’s Pro Rata Share thereof, shall
constitute Advances of such Lenders. If any such amount is not made available to Agent by any
Lender on the Settlement Date applicable thereto to the extent required by the terms hereof, Agent
shall be entitled to recover for its account such amount on demand from such Lender together with
interest thereon at the Defaulting Lender Rate.



               (ii) In determining whether a Lender’s balance of the Advances, Swing Line Loans, and
Protective Advances is less than, equal to, or greater than such Lender’s Pro Rata Share of the
Advances, Swing Line Loans, and Protective Advances as of a Settlement Date, Agent shall, as part
of the relevant Settlement, apply to such balance the portion of payments actually received in good
funds by Agent with respect to principal, interest, fees payable by Borrowers and allocable to the
Lenders hereunder, and proceeds of Collateral.



               (iii) Between Settlement Dates, Agent, to the extent Protective Advances or Swing Line Loans
are outstanding, may pay over to Agent or Swing Line Lender, as applicable, any Collections or
payments received by Agent, that in accordance with the terms of this Agreement would be applied to
the reduction of the Advances, for application to the Protective Advances or Swing Line Loans.
Between Settlement Dates, Agent, to the extent no Protective Advances or Swing Line Loans are
outstanding, may pay over to Swing Line Lender any Collections or payments received by Agent, that
in accordance with the terms of this Agreement would be applied to the reduction of the Advances,
for application to Swing Line Lender’s Pro Rata Share of the Advances. If, as of any Settlement
Date, Collections or payments of Borrowers or their Subsidiaries received



9









 




since the then immediately preceding Settlement Date have been applied to Swing Line Lender’s Pro Rata Share of
the Advances other than to Swing Line Loans, as provided for in the previous sentence, Swing Line
Lender shall pay to Agent for the accounts of the Lenders, and Agent shall pay
to the Lenders (other than a Defaulting Lender if Agent has implemented the provisions of
Section 2.3(g)), to be applied to the outstanding Advances of such Lenders, an amount such that
each such Lender shall, upon receipt of such amount, have, as of such Settlement Date, its Pro Rata
Share of the Advances. During the period between Settlement Dates, Swing Line Lender with respect
to Swing Line Loans, Agent with respect to Protective Advances, and each Lender (subject to the
effect of agreements between Agent and individual Lenders) with respect to the Advances other than
Swing Line Loans and Protective Advances, shall be entitled to interest at the applicable rate or
rates payable under this Agreement on the daily amount of funds employed by Swing Line Lender,
Agent, or the Lenders, as applicable.




               (iv) Anything in this Section 2.3(e) to the contrary notwithstanding, in the event that a
Lender is a Defaulting Lender, Agent shall be entitled to refrain from remitting settlement amounts
to the Defaulting Lender and, instead, shall be entitled to elect to implement the provisions set
forth in Section 2.3(g).



          (f) Notation. Agent, as a non-fiduciary agent for Borrowers, shall maintain a register
showing the principal amount of the Advances owing to each Lender, including the Swing Line Loans
owing to Swing Line Lender, and Protective Advances owing to Agent, and the interests therein of
each Lender, as described more fully in Section 13.1(h).




          (g) Defaulting Lenders. Agent shall not be obligated to transfer to a Defaulting Lender any
payments made by Borrowers to Agent for the Defaulting Lender’s benefit or any Collections or
proceeds of Collateral that would otherwise be remitted hereunder to the Defaulting Lender, and, in
the absence of such transfer to the Defaulting Lender, Agent shall transfer any such payments (i)
first, to Swing Line Lender to the extent of any Swing Line Loans that were made by Swing Line
Lender and that were required to be, but were not, repaid by the Defaulting Lender, (ii) second, to
the Issuing Lender, to the extent of the portion of a Letter of Credit Disbursement that was
required to be, but was not, repaid by the Defaulting Lender, (iii) third, to each non-Defaulting
Lender ratably in accordance with their Commitments (but, in each case, only to the extent that
such Defaulting Lender’s portion of an Advance (or other funding obligation) was funded by such
other non-Defaulting Lender), (iv) to a suspense account maintained by Agent, the proceeds of which
shall be, upon the request of Administrative Borrower for an Advance (subject to the satisfaction
of the condition set forth in Sections 3.1 and 3.2), made available, for the account of such
Defaulting Lender, to be re-advanced to or for the benefit of Borrowers as if such Defaulting
Lender had made its portion of such Advance hereunder, and (v) from and after the date on which all
other Obligations have been paid in full, to such Defaulting Lender in accordance with tier (M) of
Section 2.4(b)(ii) or in accordance with tier (E) of Section 2.4(b)(iii), as applicable. Subject
to the foregoing, Agent shall hold and re-lend to Borrowers for the account of such Defaulting
Lender the amount of all such payments received and retained by Agent for the account of such
Defaulting Lender. Solely for the purposes of voting or consenting to matters with respect to the
Loan Documents (including the calculation of Pro Rata Share in connection therewith) and for the
purpose of calculating the fees payable under Sections 2.10(b), such Defaulting Lender shall be
deemed not to be a “Lender” and such Lender’s Commitment shall be deemed to be zero. The
provisions of this Section 2.3(g) shall remain effective with respect to such Defaulting Lender
until the earlier of (A) the date on which the







10









 







non-Defaulting Lenders, Agent, and Borrowers shall
have waived, in writing, the application of this Section 2.3(g) to such Defaulting Lender, or (B)
the date on which such Defaulting Lender makes payment of all amounts that it was obligated to fund
hereunder, pays to Agent all amounts owing by Defaulting Lender in respect of the amounts that it was obligated to fund hereunder, and, if
requested by Agent, provides adequate assurance of its ability to perform its future obligations
hereunder. The operation of this Section 2.3(g) shall not be construed to increase or otherwise
affect the Commitment of any Lender, to relieve or excuse the performance by such Defaulting Lender
or any other Lender of its duties and obligations hereunder, or to relieve or excuse the
performance by Borrowers of their duties and obligations hereunder to Agent or to the Lenders other
than such Defaulting Lender. Any failure by a Defaulting Lender to fund amounts that it was
obligated to fund hereunder shall constitute a material breach by such Defaulting Lender of this
Agreement and shall entitle Borrowers, at their option, upon written notice to Agent, to arrange
for a substitute Lender to assume the Commitment of such Defaulting Lender, such substitute Lender
to be reasonably acceptable to Agent. In connection with the arrangement of such a substitute
Lender, the Defaulting Lender shall have no right to refuse to be replaced hereunder, and agrees to
execute and deliver a completed form of Assignment and Acceptance in favor of the substitute Lender
(and agrees that it shall be deemed to have executed and delivered such document if it fails to do
so) subject only to being repaid its share of the outstanding Obligations (other than Bank Product
Obligations, but including (1) all interest, fees, and other amounts that may be due and payable in
respect thereof, and (2) an assumption of its Pro Rata Share of the Letters of Credit);
provided, however, that any such assumption of the Commitment of such Defaulting
Lender shall not be deemed to constitute a waiver of any of the Lender Groups’ or Borrowers’ rights
or remedies against any such Defaulting Lender arising out of or in relation to such failure to
fund. In the event of a direct conflict between the priority provisions of this Section 2.3(g) and
any other provision contained in this Agreement or any other Loan Document, it is the intention of
the parties hereto that such provisions be read together and construed, to the fullest extent
possible, to be in concert with each other. In the event of any actual, irreconcilable conflict
that cannot be resolved as aforesaid, the terms and provisions of this Section 2.3(g) shall control
and govern.




          (h) Independent Obligations. All Advances (other than Swing Line Loans and Protective
Advances) shall be made by the Lenders contemporaneously and in accordance with their Pro Rata
Shares. It is understood that (i) no Lender shall be responsible for any failure by any other
Lender to perform its obligation to make any Advance (or other extension of credit) hereunder, nor
shall any Commitment of any Lender be increased or decreased as a result of any failure by any
other Lender to perform its obligations hereunder, and (ii) no failure by any Lender to perform its
obligations hereunder shall excuse any other Lender from its obligations hereunder.




     2.4 Payments; Reductions and Increases of Commitments; Prepayments.




          (a) Payments by Borrowers




               (i) Except as otherwise expressly provided herein, all payments by Borrowers shall be made to
Agent’s Account for the account of the Lender Group and shall be made in immediately available
funds, no later than 2:00 p.m. on the date specified herein. Any payment received by Agent later
than 2:00 p.m. shall be deemed to have been received on the following Business Day and any
applicable interest or fee shall continue to accrue until such following Business Day.




11











 





        
       (ii) Unless Agent receives notice from Borrowers prior to the date on which any payment
is due to the Lenders that Borrowers will not make such payment in full as and when required, Agent
may assume that Borrowers have made (or will make) such payment in full to Agent on such date in
immediately available funds and Agent may (but shall not be so required), in reliance upon such
assumption, distribute to each Lender on such due date an amount equal to the amount then due such
Lender. If and to the extent Borrowers do not make such payment in full to Agent on the date when
due, each Lender severally shall repay to Agent on demand such amount distributed to such Lender,
together with interest thereon at the Defaulting Lender Rate for each day from the date such amount
is distributed to such Lender until the date repaid.



          (b) Apportionment and Application.




        
       (i) So long as no Application Event has occurred and is continuing and except as otherwise
provided herein with respect to Defaulting Lenders, all principal and interest payments received by
Agent shall be apportioned ratably among the Lenders entitled to receive such payments (according
to the unpaid principal balance of the Obligations to which such payments relate held by each
Lender) and all payments of fees and expenses received by Agent (other than fees or expenses that
are for Agent’s separate account or for the separate account of the Issuing Lender) shall be
apportioned ratably among the Lenders having a Pro Rata Share of the type of Revolving Commitment
or Obligation to which a particular fee or expense relates. All payments to be made hereunder by
Borrowers shall be remitted to Agent and all (subject to Section 2.4(b)(v), and Section 2.4(e))
such payments, and all proceeds of Collateral received by Agent, shall be applied, so long as no
Application Event has occurred and is continuing, to reduce the balance of the Advances outstanding
and, thereafter, to Borrowers (to be wired to the Designated Account) or such other Person entitled
thereto under applicable law.



       
        (ii) At any time that an Application Event has occurred and is continuing and except as
otherwise provided herein with respect to Defaulting Lenders, all payments remitted to Agent in
respect of the Obligations (other than the Ex-Im Advances) and all proceeds of Collateral (other
than Foreign Accounts) received by Agent shall be applied as follows:



         
           (A) first, to pay any Lender Group Expenses (including cost or expense reimbursements)
or indemnities then due to Agent under the Loan Documents, until paid in full,



         
           (B) second, to pay any fees or premiums then due to Agent under the Loan Documents
until paid in full,



         
           (C) third, to pay interest due in respect of all Protective Advances until paid in
full,



         
           (D) fourth, to pay the principal of all Protective Advances until paid in full,



         
           (E) fifth, ratably, to pay any Lender Group Expenses (including cost or expense
reimbursements) or indemnities then due to any of the Lenders under the Loan Documents, until paid
in full,



12









 





                    (F) sixth, ratably, to pay any fees or premiums then due to any of the Lenders under
the Loan Documents until paid in full,



                    (G) seventh, to pay interest accrued in respect of the Swing Line Loans until paid in
full,



                    (H) eighth, to pay the principal of all Swing Line Loans until paid in full,



                    (I) ninth, ratably, to pay interest accrued in respect of the Advances (other than
Protective Advances and Ex-Im Advances) until paid in full,



                    (J) tenth, ratably (1) to pay the principal of all Advances (other than Ex-Im
Advances) until paid in full, (2) to Agent, to be held by Agent, for the benefit of Issuing Lender
(and for the ratable benefit of each of the Lenders that have an obligation to pay to Agent, for
the account of the Issuing Lender, a share of each Letter of Credit Disbursement), as cash
collateral in an amount up to one hundred five (105%) percent of the Letter of Credit Usage (to the
extent permitted by applicable law, such cash collateral shall be applied to the reimbursement of
any Letter of Credit Disbursement as and when such disbursement occurs and, if a Letter of Credit
expires undrawn, the cash collateral held by Agent in respect of such Letter of Credit shall, to
the extent permitted by applicable law, be reapplied pursuant to this Section 2.4(b)(ii), beginning
with tier (A) hereof), and (3) ratably, to the Bank Product Providers based upon amounts then
certified by the applicable Bank Product Provider to Agent (in form and substance satisfactory to
Agent) to be due and payable to such Bank Product Providers on account of Bank Product Obligations
but only to the extent of the then Bank Product Reserve Amount then in effect with respect to such
Bank Product Obligations,



                    (K) eleventh, ratably, to the Bank Product Providers based upon amounts certified by
the applicable Bank Product Provider to Agent (in form and substance satisfactory to Agent) to be
due and payable on account of Bank Product Obligations (other than Bank Product Obligations paid
pursuant to clause (J) above),



                    (L) twelfth, to pay any other Obligations other than Obligations owed to Defaulting
Lenders,



                    (M) thirteenth, ratably to pay any Obligations owed to Defaulting Lenders; and



                    (N) fourteenth, to Borrowers (to be wired to the Designated Account) or such other
Person entitled thereto under applicable law.



               (iii) At any time that an Application Event has occurred and is continuing and except as
otherwise provided herein with respect to Defaulting Lenders, all payments remitted to Agent in
respect of the Ex-Im Advances and all proceeds of Foreign Accounts received by Agent shall be
applied as follows:



                    (A) first, to pay any Lender Group Expenses (including cost or expense reimbursements)
then due to Agent under the Loan Documents in connection with the collection or enforcement of
Foreign Accounts or the protection, preservation, sale or realization upon Foreign Accounts, until
paid in full,



13









 





                    (B) second, ratably to pay any fees then due to any of the Lenders that has an Ex-Im
revolving Commitment or an outstanding Ex-Im Advance until paid in full,



                    (C) third, ratably, to pay interest accrued in respect of the Ex-Im Advances until
paid in full,



                    (D) fourth, to pay the principal of all Ex-Im Advances until paid in full,



                    (E) fifth, to pay any other Obligations other than Obligations owed to Defaulting
Lenders, to be applied pursuant to Section 2.4(b)(ii), beginning with tier (A),



                    (F) sixth, ratably to pay any Obligations owed to Defaulting Lenders, and



                    (G) seventh, to Borrowers (to be wired to the Designated Account) or such other Person
entitled thereto under applicable law.



               (iv) Agent promptly shall distribute to each Lender, pursuant to the applicable wire
instructions received from each Lender in writing, such funds as it may be entitled to receive,
subject to a Settlement delay as provided in Section 2.3(e).



               (v) In each instance, so long as no Application Event has occurred and is continuing, Section
2.4(b)(i) shall not apply to any payment made by Borrowers to Agent and specified by Borrowers to
be for the payment of specific Obligations then due and payable (or prepayable) under any provision
of this Agreement or any other Loan Document.



               (vi) For purposes of Section 2.4(b)(ii) or (iii), “paid in full” of a type of Obligation means
payment in cash or immediately available funds of all amounts owing on account of such type of
Obligation, including interest accrued after the commencement of any Insolvency Proceeding, default
interest, interest on interest, and expense reimbursements.



               (vii) In the event of a direct conflict between the priority provisions of this Section 2.4
and any other provision contained in this Agreement or any other Loan Document, it is the intention
of the parties hereto that such provisions be read together and construed, to the fullest extent
possible, to be in concert with each other. In the event of any actual, irreconcilable conflict
that cannot be resolved as aforesaid, if the conflict relates to the provisions of Section 2.3(g)
and this Section 2.4, then the provisions of Section 2.3(g) shall control and govern, and if
otherwise, then the terms and provisions of this Section 2.4 shall control and govern.



          (c) Reduction and Termination of Commitments.




               (i) Revolver Commitments. The US Revolver Commitments shall terminate on the Maturity Date.
The Ex-Im Revolver Commitments shall terminate on the Ex-Im Maturity Date. Borrowers may reduce
the Revolver Commitments, in whole or in part, without premium or penalty; provided,
that, Borrowers shall not at any time reduce the Ex-Im Revolver Commitments to an amount
less than the sum of (A) the Ex-Im Revolver Usage as of such time plus (B) the principal amount of
all Ex-Im Advances not yet made as of such time as to which a request has been given by Borrowers
or Administrative Borrower; provided, further, that, Borrowers shall not at
any time reduce the US Revolving Commitments to an amount less than the sum of (x) the US Revolver



14









 







Usage as of such time, plus (y) the principal amount of all US Advances not yet made as of such
time as to which a request has been given by Borrowers or Administrative Borrower under Section
2.3(a), plus (z) the amount of all Letters of Credit not yet issued as of such time as to which a
request has been given by Borrowers or Administrative Borrower pursuant to Section 2.11(a). Each such
reduction shall be in an amount which is not less than $2,000,000 (unless the Revolver Commitments
are being reduced to zero and the amount of the Revolver Commitments in effect immediately prior to
such reduction are less than $2,000,000), shall be made by providing not less than ten (10)
Business Days prior written notice to Agent (or such lesser number of Business Days as may be
acceptable to Agent), which notice shall specify whether such reduction is in respect of the Ex-Im
Revolver Commitment and/or the US Revolver Commitment and shall be irrevocable. Once reduced, the
Revolver Commitments may not be increased. Each such reduction of the Revolver Commitments shall
reduce the Revolver Commitments of each Lender proportionately in accordance with its Pro Rata
Share thereof.



               (ii) [Reserved]



          (d) Optional Prepayments.




               (i) Advances. Borrowers may prepay the principal of any Advance at any time in whole or in
part, without premium or penalty.



               (ii) [Reserved]



          (e) Mandatory Prepayments.




               (i) Borrowing Base. If, at any time, (A) the US Revolver Usage on such date exceeds the US
Borrowing Base, or (B) the Ex-Im Revolving Usage on such date exceeds the Ex-Im Borrowing Base (any
such excess being referred to as the “Borrowing Base Excess”), then Borrowers shall promptly, but
in any event, within one (1) Business Day prepay the Obligations in accordance with Section
2.4(f)(i) in an aggregate amount equal to the Borrowing Base Excess; provided,
that, to the extent that any portion of the Borrowing Base Excess arises as a direct result
of the establishment of reserves by Agent or changes by Agent to the criteria for Eligible
Accounts, Eligible Inventory or Eligible Insurance Accounts, Borrowers shall prepay the Obligations
in an amount equal to such portion of the Borrowing Base Excess within three (3) Business Days
following the receipt by Administrative Borrower of written notice of such establishment or change.



               (ii) Dispositions. Within one (1) Business Day of the date of receipt by any Loan Party of
the Net Cash Proceeds of any voluntary or involuntary sale or disposition by Parent or any
Subsidiary of Parent of any Revolving Loan Priority Collateral (including casualty losses or
condemnations but excluding sales or dispositions which qualify as Permitted Dispositions under
clauses (a), (b) or (o) of the definition of Permitted Dispositions), Borrowers shall prepay the
outstanding principal amount of the Obligations in accordance with Section 2.4(f)(ii) in an amount
equal to one hundred (100%) percent of such Net Cash Proceeds (including condemnation awards,
insurance recoveries and payments in lieu thereof); provided, that, so long as (A)
no Cash Dominion Period exists, and no Default or Event of Default shall have occurred and is
continuing or would result therefrom, (B) Administrative Borrower shall have given Agent prior
written notice of Borrowers’ intention to reinvest such monies in assets which constitute Revolving
Loan Priority



15









 







Collateral, (C) the monies are held in a Deposit Account in which Agent has a
perfected first-priority security interest, (D) the failure to promptly apply the Net Cash Proceeds
to prepay the Obligations will not result in a requirement that such Net Cash Proceeds be applied
to prepay any amounts owing under the Term Loan Documents, and (E) Borrowers or Guarantors, as applicable, complete such
reinvestment within 120 days after the initial receipt of such monies, then the Borrowers shall
have the option to apply such monies to reinvest in assets which constitute Revolving Loan Priority
Collateral unless and to the extent that such applicable period shall have expired without such
purchase being made, in which case any amounts remaining in the cash collateral account shall be
paid to the Agent and applied in accordance with Section 2.4(f)(ii). Nothing contained in this
Section 2.4(e)(ii) shall permit Parent or any of its Subsidiaries to sell or otherwise dispose of
any assets other than in accordance with Section 6.4.



               (iii) Environmental Insurance Receivables. Within one (1) Business Day of the date of receipt
by Borrowers or Guarantors of proceeds of Environmental Insurance Receivables, Borrowers shall (A)
prepay the outstanding principal amount of the Obligations in accordance with Section 2.4(f)(ii) in
an amount equal to one hundred (100%) percent of such proceeds (each such prepayment, an
“Environmental Insurance Receivables Prepayment” and collectively, the “Environmental Insurance
Receivables Prepayments”) and (B) provide Agent with reasonably acceptable evidence that the source
of such Environmental Insurance Receivables Prepayment was the proceeds of Environmental Insurance
Receivables; provided, that, the obligation of Borrowers to prepay Obligations
pursuant to this Section 2.4(e)(iii) shall terminate after Borrowers shall have prepaid Obligations
pursuant to this Section 2.4(e)(iii) with proceeds of Environmental Insurance Receivables in an
aggregate amount of $20,000,000.



          (f) Application of Payments.




               (i) Each prepayment pursuant to Section 2.4(e)(i) shall, (A) so long as no Application Event
shall have occurred and be continuing, be applied, first, to the outstanding principal
amount of the Advances until paid in full, and second, to cash collateralize the Letters of
Credit in an amount equal to one hundred five (105%) percent of the then extant Letter of Credit
Usage, and (B) if an Application Event shall have occurred and be continuing, be applied in the
manner set forth in Section 2.4(b)(ii) or 2.4(b)(iii), as applicable.



               (ii) Each prepayment of the Obligations pursuant to Section 2.4(e)(ii) or 2.4(e)(iii) above
shall (A) so long as no Application Event shall have occurred and be continuing, be applied, first,
to the outstanding principal amount of the Advances, until paid in full, and second, to cash
collateralize the Letters of Credit in an amount equal to one hundred five (105%) percent of the
then extant Letter of Credit Usage and (B) if an Application Event shall have occurred and be
continuing, be applied in the manner set forth in Section 2.4(b)(ii) or 2.4(b)(iii), as applicable.



          (g) Increase of Commitments




               (i) Administrative Borrower may, at any time, so long as no Event of Default shall exist or
have occurred and be continuing, deliver a written request to Agent to increase the Maximum US
Revolver Amount. Any such written request shall specify the amount of the increase in the Maximum
US Revolver Amount that Borrowers are requesting, provided, that, (A) in no event
shall the aggregate amount of any such increase in the Maximum US Revolving Amount (the



16









 







“Incremental Facility”) cause the Maximum US Revolver Amount to exceed $150,000,000, (B) such
request shall be for an increase of not less than $5,000,000, (C) any such request shall be
irrevocable and (D) in no event shall more than three (3) such written requests be delivered to
Agent during the term of the Agreement. All requests for an increase in the Maximum US Revolver
Amount shall include a corresponding request for an increase in the US Revolver Commitments.



               (ii) Upon the receipt by Agent of any such written request, 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 US Revolver Commitment by an amount up to its Pro Rata Share of the amount of the
increase in the Maximum US Revolver Amount requested by Administrative Borrower as set forth in the
notice from Agent to such Lender. Each Lender shall notify Agent within fifteen (15) Business Days
after the receipt of such notice from Agent whether it is willing to so increase its US Revolver
Commitment, and if so, the amount of such increase; provided, that, (A) the minimum
increase in the US Revolver Commitments of each such Lender providing the additional Commitments
shall equal or exceed $1,000,000, and (B) no Lender shall be obligated to provide such increase in
its US Revolver Commitment and the determination to increase the US Revolver Commitment of a Lender
shall be within the sole and absolute discretion of such Lender. If the aggregate amount of the
increases in the US Revolver Commitments received from the Lenders does not equal or exceed the
amount of the increase in the Maximum US Revolver Amount requested by Administrative Borrower, then
Agent may seek additional increases from Lenders or Commitments from such Eligible Transferees as
it may determine. 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 US Revolver Commitments or new US
Revolver Commitments in an aggregate amount in excess of the increase in the Maximum US Revolver
Amount 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. Additional Commitments for
the Incremental Facility shall be on the same terms and conditions as the Commitments on the date
hereof for US Advances.



               (iii) The Maximum US Revolver Amount shall be increased by the amount of the increase in US
Revolver Commitments from Lenders or new US Revolver Commitments from Eligible Transferees, with
corresponding increases in the US Revolver Commitments, in each case as selected in accordance with
Section 2.4(g)(ii) above, for which Agent has received Assignment and Acceptances forty-five (45)
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 US Revolver Commitments
and new US Revolver Commitments, as the case may be, equal or exceed the amount of the increase in
the Maximum US Revolver Amount requested by Administrative Borrower in accordance with the terms
hereof, effective on the date that each of the following conditions have been satisfied;



               (iv) Agent shall have received from each Lender or Eligible Transferee that is providing an
additional Commitment as part of the increase in the Maximum US Revolver Amount, an Assignment and
Acceptance duly executed by such Lender or Eligible Transferee and each Borrower, provided,
that, the aggregate Commitments set forth in such Assignment and Acceptance(s) shall be not
less than $5,000,000;



17









 





               (v) the conditions precedent to the making of Advances set forth in Section 4.2 shall be
satisfied as of the date of the increase in the Maximum US Revolver Amount, both before and after
giving effect to such increase;



               (vi) Agent, at its option, shall have received an opinion of counsel to Borrowers and
Guarantors in form and substance and from counsel reasonably satisfactory to Agent addressing such
matters as Agent may reasonably request (including an opinion as to no conflicts with other
Indebtedness and a non-contravention opinion as to other documents and Indebtedness);



               (vii) such increase in the Maximum US Revolver Amount 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;



               (viii) there shall have been paid to each Lender and Eligible Transferee providing an
additional Commitment in connection with such increase in the Maximum US Revolver Amount all fees
and expenses arising under or related to this Agreement that are due and payable to such Person on
or before the effectiveness of such increase;



               (ix) as of the effective date of any such increase in the Maximum US Revolver Amount, each
reference to the term Maximum US Revolver Amount (and US Revolver Commitments) herein and in any of
the other Loan Documents shall be deemed amended to mean the amount of the Maximum US Revolver
Amount (and US Revolver Commitments) after giving effect to the Incremental Facility as specified
in the most recent written notice from Agent to Administrative Borrower of the increase in the
Maximum US Revolver Amount (and US Revolver Commitments);



               (x) Effective on the date of each increase in the Maximum US Revolver Amount pursuant to this
Section 2.4(g), each reference in this Agreement to an amount of Excess Availability or US Excess
Availability, shall, automatically and without any further action, be deemed to be increased so
that the ratio of each amount of Excess Availability or US Excess Availability to the amount of the
Maximum US Revolver Amount after such increase in the Maximum US Revolver Amount remains the same
as the ratio of such amount of Excess Availability or US Excess Availability to the amount of the
Maximum US Revolver Amount prior to such increase in the Maximum US Revolver Amount;



               (xi) Following the effective date of any increase in the Maximum US Revolver Amount pursuant
to this Section, Agent shall provide notice thereof to Lenders, and at Agent’s option, Borrowers,
Guarantors and Agent shall enter into an amendment to this Agreement providing for such increase in
the Maximum US Revolver Amount, the US Revolver Commitments and the increases in the Excess
Availability thresholds set forth in Section 2.4(g), and Agent is hereby authorized to enter into
such amendment on behalf of Lenders.



     2.5 Overadvances. If, at any time or for any reason, the amount of Obligations owed
by Borrowers to the Lender Group pursuant to Section 2.1 or Section 2.11 is greater than any of the
limitations set forth in Section 2.1 or Section 2.11, as applicable (an “Overadvance”), Borrowers
shall immediately pay to Agent, in cash, the amount of such excess, which amount shall be used by



18









 







Agent to reduce the Obligations in accordance with the priorities set forth in Section 2.4(b);
provided, that, if any Overadvance is caused solely by the establishment of a
reserve by Agent after the Closing Date or a modification by Agent after the Closing Date to the
criteria for Eligible Accounts, Eligible Inventory, Eligible Insurance Accounts or Eligible Mexican
Accounts (but in each case, without the prior written consent of Borrowers), Borrowers shall pay in cash,
within three (3) Business Days of the date Administrative Borrower receives written notice of such
reserve, the amount of such Overadvance. Borrowers promise to pay the Obligations (including
principal, interest, fees, costs, and expenses) in full on the Maturity Date or, if earlier, on the
date on which the Obligations (other than the Bank Product Obligations) become due and payable
pursuant to the terms of this Agreement; provided, that, the outstanding principal
amount of the Ex-Im Advances, together with interest and fees accrued thereon, shall be due and
payable in full on the Ex-Im Maturity Date or, if earlier, on the date on which the Obligations
(other than the Bank Product Obligations) become due and payable pursuant to the terms of this
Agreement.



     2.6 Interest Rates and Letter of Credit Fee: Rates, Payments, and Calculations.



          (a) Interest Rates. Except as provided in Section 2.6(c), all Obligations (except for undrawn
Letters of Credit) that have been charged to the Loan Account pursuant to the terms hereof shall
bear interest on the Daily Balance thereof as follows:




               (i) if the relevant Obligation is a LIBOR Rate Loan, at a per annum rate equal to the LIBOR
Rate plus the LIBOR Rate Margin, and



               (ii) otherwise, at a per annum rate equal to the Base Rate plus the Base Rate Margin.



          (b) Letter of Credit Fee. Borrowers shall pay Agent (for the ratable benefit of the Lenders
with a US Revolver Commitment, subject to any agreements between Agent and individual Lenders), a
Letter of Credit fee (in addition to the charges, commissions, fees, and costs set forth in Section
2.11(e)) which shall accrue at a per annum rate equal to the LIBOR Rate Margin times the Daily
Balance of the undrawn amount of all outstanding Letters of Credit.




          (c) Default Rate. Upon the occurrence and during the continuation of an Event of Default and
at the election of the Required Lenders,




               (i) all Obligations (except for undrawn Letters of Credit) that have been charged to the Loan
Account pursuant to the terms hereof shall bear interest on the Daily Balance thereof at a per
annum rate equal to 2 percentage points above the per annum rate otherwise applicable thereunder,
and



               (ii) the Letter of Credit fee provided for in Section 2.6(b) shall be increased to 2
percentage points above the per annum rate otherwise applicable hereunder.



          (d) Payment. Except to the extent provided to the contrary in Section 2.10 or Section
2.12(a), interest, Letter of Credit fees, all other fees payable hereunder or under any of the
other Loan Documents, and all costs, expenses, and Lender Group Expenses payable hereunder or under
any of the other Loan Documents shall be due and payable, in arrears, on the first (1st) day of
each



19









 






month at any time that Obligations or Commitments are outstanding. Borrowers hereby authorize
Agent, from time to time without prior notice to Borrowers (or, solely in the case of Lender Group
Expenses relating to any visit and inspection pursuant to Section 5.7, upon not less than five (5)
Business Days’ prior written notice to Borrowers or in the case of any other Lender Group Expenses,
upon not less than fifteen (15) Business days’ prior written notice to Borrowers), to charge the
Loan Account for all interest, Letter of Credit fees, and all other fees payable hereunder or
under any of the other Loan Documents (in each case, as and when due and payable), all costs,
expenses, and Lender Group Expenses payable hereunder or under any of the other Loan Documents (in
each case, as and when incurred, but as to Lender Group Expenses relating to any visit and
inspection pursuant to Section 5.7 upon not less than five (5) Business Days’ prior written notice
to Borrowers or in the case of any other Lender Group Expenses, upon not less than fifteen (15)
Business Days prior written notice to Borrowers), all charges, commissions, fees, and costs
provided for in Section 2.11(e) (as and when accrued or incurred, all fees and costs provided for
in Section 2.10 (as and when accrued or incurred), all other payments as and when due and payable
under any Loan Document or, if an Event of Default shall have occurred and be continuing, any other
Obligations then due and payable, which amounts shall thereafter constitute Advances hereunder and
shall accrue interest at the rate then applicable to Advances that are Base Rate Loans. Any
interest, fees, costs, expenses, Lender Group Expenses, or other amounts payable hereunder or under
any other Loan Document or under any Bank Product Agreement that are charged to the Loan Account in
accordance with the immediately preceding sentence shall thereafter constitute Advances hereunder
and shall accrue interest at the rate then applicable to Advances that are Base Rate Loans (unless
and until converted into LIBOR Rate Loans in accordance with the terms of this Agreement).




          (e) Computation. All interest and fees chargeable under the Loan Documents shall be computed
on the basis of a 360 day year, in each case, for the actual number of days elapsed in the period
during which the interest or fees accrue. In the event the Base Rate is changed from time to time
hereafter, the rates of interest hereunder based upon the Base Rate automatically and immediately
shall be increased or decreased by an amount equal to such change in the Base Rate.




          (f) Intent to Limit Charges to Maximum Lawful Rate. In no event shall the interest rate or
rates payable under this Agreement, plus any other amounts paid in connection herewith, exceed the
highest rate permissible under any law that a court of competent jurisdiction shall, in a final
determination, deem applicable. Borrowers and the Lender Group, in executing and delivering this
Agreement, intend legally to agree upon the rate or rates of interest and manner of payment stated
within it; provided, however, that, anything contained herein to the contrary
notwithstanding, if said rate or rates of interest or manner of payment exceeds the maximum
allowable under applicable law, then, ipso facto, as of the date of this Agreement, Borrowers are
and shall be liable only for the payment of such maximum as allowed by law, and payment received
from Borrowers in excess of such legal maximum, whenever received, shall be applied to reduce the
principal balance of the Obligations to the extent of such excess.




     2.7 Crediting Payments. The receipt of any payment item by Agent shall not be
considered a payment on account unless such payment item is a wire transfer of immediately
available federal funds made to Agent’s Account or unless and until such payment item is honored
when presented for payment. Should any payment item not be honored when presented for payment,
then Borrowers shall be deemed not to have made such payment and interest shall be calculated
accordingly. Anything to the contrary contained herein notwithstanding, any payment item shall be



20









 







deemed received by Agent only if it is received into Agent’s Account on a Business Day on or before
2:00 p.m. If any payment item is received into Agent’s Account on a non-Business Day or after 2:00
p.m. on a Business Day, it shall be deemed to have been received by Agent as of the opening of
business on the immediately following Business Day.



     2.8 Designated Account. Agent is authorized to make the Advances, and Issuing Lender
is authorized to issue the Letters of Credit, under this Agreement based upon telephonic or other
instructions received from anyone purporting to be an Authorized Person or, without instructions,
if pursuant to Section 2.6(d). Each Borrower agrees to establish and maintain the Designated
Account with the Designated Account Bank for the purpose of receiving the proceeds of the Advances
requested by such Borrower, or on its behalf by Administrative Borrower, and made by Agent or the
Lenders hereunder. Unless otherwise agreed by Agent and Borrowers, any Advance or Swing Line Loan
requested by or on behalf of a Borrower and made by Agent or the Lenders hereunder shall be made to
the Designated Account.



     2.9 Maintenance of Loan Account; Statements of Obligations. Agent shall maintain an
account on its books in the name of Borrowers (the “US Loan Account”) on which Borrowers shall be
charged with all Advances (including Protective Advances and Swing Line Loans) made by Agent, Swing
Line Lender, or the Lenders to Borrowers or for Borrowers’ account, the Letters of Credit issued or
arranged by Issuing Lender for Borrowers’ account, and with all other payment Obligations hereunder
or under the other Loan Documents, including, accrued interest, fees and expenses, and Lender Group
Expenses. In accordance with Section 2.7, the Loan Account will be credited with all payments
received by Agent from Borrowers or for Borrowers’ account. Agent shall render monthly statements
regarding the Loan Account to Borrowers, including principal, interest, fees, and including an
itemization of all charges and expenses constituting Lender Group Expenses owing, and such
statements, absent manifest error, shall be conclusively presumed to be correct and accurate and
constitute an account stated between Borrowers and the Lender Group unless, within thirty (30) days
after receipt thereof by Borrowers, Borrowers shall deliver to Agent written objection thereto
describing the error or errors contained in any such statements.



     2.10 Fees.



          (a) Borrowers shall pay to Agent, for the account of Agent, as and when due and payable under
the terms of the Fee Letter, the fees set forth in the Fee Letter.




          (b) Borrowers shall pay to Agent, for the ratable account of those Lenders with Revolver
Commitments, on the first (1st) day of each month from and after the Closing Date up to the first
(1st) day of the month prior to the Payoff Date and on the Payoff Date, an unused line fee in an
amount equal to one-half of one (.50%) percent per annum times the result of (i) the aggregate
amount of the Revolver Commitments, less (ii) the average Daily Balance of the Revolver Usage
during the immediately preceding month (or portion thereof); it being understood that, without
duplication, the outstanding amount of Swing Line Loans, Protective Advances and LC Usage shall be
included in the calculation of Revolver Usage for purposes of this clause (b).




          (c) If for any reason this Agreement is terminated on or prior to the first anniversary of the
Closing Date, in view of the impracticality and extreme difficulty of ascertaining actual damages
and by mutual agreement of the parties as to a reasonable calculation of Lenders’ lost profits as a



21









 






result thereof, Borrowers shall pay to Agent, for the ratable account of Lenders, upon the
effective date of such termination, an early termination fee in the amount equal to one (1%)
percent of the Maximum Revolver Amount; provided, that, such early termination fee
shall not be due and payable if, solely as a result of the establishment of discretionary reserves
by the Agent after the Closing Date but before the first anniversary of the Closing Date, the
amount of the Borrowing Base shall be reduced by more than 10% of the amount of the Borrowing Base on the Closing Date. Such early
termination fee shall be presumed to be the amount of damages sustained by Lenders as a result of
such early termination and each Borrower agrees that it is reasonable under the circumstances
currently existing (including, but not limited to, the borrowings that are reasonably expected by
Borrowers hereunder and the interest, fees and other charges that are reasonably expected to be
received by Lenders hereunder). In addition, Lenders shall be entitled to such early termination
fee upon the occurrence of any Event of Default described in Section 8.4 or 8.5, even if Agent or
Lenders do not exercise their right to terminate this Agreement, but elects to provide financing to
Borrowers or permit the use of cash collateral under the Bankruptcy Code.




          (d) Borrowers shall pay to Agent, for the account of Ex-Im Bank, on the date of this Agreement
and on each anniversary thereof until such time as the Ex-Im Revolver Commitments have been
terminated or reduced to zero, a fee in an amount equal to the Ex-Im Bank Fee Rate times the Ex-Im
Revolver Commitments on the date such fee is due and payable.




     2.11 Letters of Credit



          (a) Subject to the terms and conditions of this Agreement, upon the request of Administrative
Borrower made in accordance herewith, the Issuing Lender agrees to issue, or to cause an Underlying
Issuer, as Issuing Lender’s agent, to issue, a requested Letter of Credit. If Issuing Lender, at
its option, elects to cause an Underlying Issuer to issue a requested Letter of Credit, then
Issuing Lender agrees that it will enter into arrangements relative to the reimbursement of such
Underlying Issuer (which may include, among, other means, by becoming an applicant with respect to
such Letter of Credit or entering into undertakings which provide for reimbursements of such
Underlying Issuer with respect to such Letter of Credit; each such obligation or undertaking,
irrespective of whether in writing, a “Reimbursement Undertaking”) with respect to Letters of
Credit issued by such Underlying Issuer. By submitting a request to Issuing Lender for the
issuance of a Letter of Credit, Borrowers shall be deemed to have requested that Issuing Lender
issue or that an Underlying Issuer issue the requested Letter of Credit and to have requested
Issuing Lender to issue a Reimbursement Undertaking with respect to such requested Letter of Credit
if it is to be issued by an Underlying Issuer (it being expressly acknowledged and agreed by
Borrowers that Borrowers are and shall be deemed to be applicants (within the meaning of Section
5-102(a)(2) of the UCC) with respect to each Underlying Letter of Credit. Each request for the
issuance of a Letter of Credit, or the amendment, renewal, or extension of any outstanding Letter
of Credit, shall be made in writing by an Authorized Person and delivered to the Issuing Lender via
hand delivery, telefacsimile, or other electronic method of transmission reasonably in advance of
the requested date of issuance, amendment, renewal, or extension. Each such request shall be in
form and substance reasonably satisfactory to the Issuing Lender and shall specify (i) the amount
of such Letter of Credit, (ii) the date of issuance, amendment, renewal, or extension of such
Letter of Credit, (iii) the expiration date of such Letter of Credit, (iv) the name and address of
the beneficiary of the Letter of Credit, and (v) such other information (including, in the case of
an amendment, renewal, or extension, identification of the Letter of Credit to be so amended,
renewed, or extended) as shall be necessary to prepare,



22









 






amend, renew, or extend such Letter of Credit. Anything contained herein to the contrary notwithstanding, the Issuing Lender shall not be
obligated to issue or cause the issuance of a Letter of Credit or issue a Reimbursement Undertaking
in respect of an Underlying Letter of Credit at any time if any Lender is a Defaulting Lender at
such time unless Agent has received cash collateral from Borrowers in an amount equal to the Pro
Rata Share of such Defaulting Lender (calculated as in effect immediately prior to such Lender becoming a Defaulting Lender) of the face amount of
such Letter of Credit. The Issuing Lender shall have no obligation to issue a Letter of Credit or
a Reimbursement Undertaking in respect of an Underlying Letter of Credit, in either case, if any of
the following would result after giving effect to the requested issuance:




               (i) the US Letter of Credit Usage would exceed the US Borrowing Base less the outstanding
amount of US Advances (inclusive of Swing Line Loans), or



               (ii) the US Letter of Credit Usage would exceed $50,000,000, or



               (iii) the US Letter of Credit Usage would exceed the Maximum US Revolver Amount less the
outstanding amount of US Advances (including Swing Line Loans), or



               (iv) the sum of the US Revolver Usage plus the Ex-Im Revolver Usage would exceed the Maximum
Revolver Amount.


Borrowers and the Lender Group hereby acknowledge and agree that all Existing Letters of Credit
shall constitute Letters of Credit issued for the account of US Borrowers under this Agreement on
and after the Closing Date with the same effect as if such Existing Letters of Credit were issued
by Issuing Lender or an Underlying Issuer at the request of Administrative Borrower, for and on
behalf of US Borrowers, on the Closing Date. Each Letter of Credit shall be in form and substance
reasonably acceptable to the Issuing Lender, including the requirement that the amounts payable
thereunder must be payable in Dollars. If Issuing Lender makes a payment under a US Letter of
Credit or an Underlying Issuer makes a payment under a US Underlying Letter of Credit, US Borrowers
shall pay to Agent an amount equal to the applicable Letter of Credit Disbursement on the date such
Letter of Credit Disbursement is made and, in the absence of such payment, the amount of the US
Letter of Credit Disbursement immediately and automatically shall be deemed to be a US Advance
hereunder and, initially, shall bear interest at the rate then applicable to US Advances that are
Base Rate Loans. If a Letter of Credit Disbursement is deemed to be an Advance hereunder,
Borrowers’ obligation to pay the amount of such Letter of Credit Disbursement to Issuing Lender
shall be discharged and replaced by the resulting Advance. Promptly following receipt by Agent of
any payment from Borrowers pursuant to this paragraph, Agent shall distribute such payment to the
Issuing Lender or, to the extent that Lenders have made payments pursuant to Section 2.11(b) to
reimburse the Issuing Lender, then to such Lenders and the Issuing Lender as their interests may
appear.




          (b) Promptly following receipt of a notice of a US Letter of Credit Disbursement pursuant to
Section 2.11(a), each Lender with a US Revolver Commitment agrees to fund its Pro Rata Share of any
US Advance deemed made pursuant to Section 2.11(a) on the same terms and conditions as if Borrowers
had requested the amount thereof as an Advance and Agent shall promptly pay to Issuing Lender the
amounts so received by it from the Lenders. By the issuance of a Letter of Credit or a
Reimbursement Undertaking with respect thereto (or an amendment to a US



23









 






Letter of Credit or a Reimbursement Undertaking increasing the amount thereof) and without any further action on the part
of the Issuing Lender or the Lenders with Revolver Commitments, the Issuing Lender shall be deemed
to have granted to each Lender with a US Revolver Commitment, and each Lender with a US Revolver
Commitment shall be deemed to have purchased, a participation in each US Letter of Credit issued by
Issuing Lender and each Reimbursement Undertaking with respect thereto, in an amount equal to its Pro Rata Share of such Letter of
Credit or Reimbursement Undertaking, and each such Lender agrees to pay to Agent, for the account
of the Issuing Lender, such Lender’s Pro Rata Share of any Letter of Credit Disbursement made by
Issuing Lender or an Underlying Issuer under the applicable US Letter of Credit. In consideration
and in furtherance of the foregoing, each Lender with a US Revolver Commitment hereby absolutely
and unconditionally agrees to pay to Agent, for the account of the Issuing Lender, such Lender’s
Pro Rata Share of each US Letter of Credit Disbursement made by Issuing Lender or an Underlying
Issuer and not reimbursed by Borrowers on the date due as provided in Section 2.11(a), or of any
reimbursement payment required to be refunded to US Borrowers for any reason. Each Lender with a
Revolver Commitment acknowledges and agrees that its obligation to deliver to Agent, for the
account of the Issuing Lender, an amount equal to its respective Pro Rata Share of each Letter of
Credit Disbursement pursuant to this Section 2.11(b) shall be absolute and unconditional and such
remittance shall be made notwithstanding the occurrence or continuation of an Event of Default or
Default or the failure to satisfy any condition set forth in Section 3. If any such Lender fails
to make available to Agent the amount of such Lender’s Pro Rata Share of a Letter of Credit
Disbursement as provided in this Section, such Lender shall be deemed to be a Defaulting Lender and
Agent (for the account of the Issuing Lender) shall be entitled to recover such amount on demand
from such Lender together with interest thereon at the Defaulting Lender Rate until paid in full.




          (c) Borrowers hereby agree to jointly and severally indemnify, save, defend, and hold the
Lender Group and each Underlying Issuer harmless from any damage, loss, cost, expense, or
liability, and reasonable attorneys fees incurred by Issuing Lender, any other member of the Lender
Group, or any Underlying Issuer arising out of or in connection with any Reimbursement Undertaking
or any Letter of Credit; provided, however, that Borrowers shall not be obligated
hereunder to indemnify for any loss, cost, expense, or liability that a court of competent
jurisdiction finally determines to have resulted from the gross negligence or willful misconduct of
the Issuing Lender, any other member of the Lender Group, or any Underlying Issuer. Borrowers
agree to be bound by the Underlying Issuer’s regulations and interpretations of any Letter of
Credit or by Issuing Lender’s interpretations of any Reimbursement Undertaking even though this
interpretation may be different from Borrowers’ own, and Borrowers understand and agree that none
of the Issuing Lender, the Lender Group, or any Underlying Issuer shall be liable for any error,
negligence, or mistake, whether of omission or commission, in following Borrowers’ instructions or
those contained in the Letter of Credit or any modifications, amendments, or supplements thereto.
Borrowers understand that the Reimbursement Undertakings may require Issuing Lender to indemnify
the Underlying Issuer for certain costs or liabilities arising out of claims by Borrowers against
such Underlying Issuer. Borrowers hereby agree to jointly and severally indemnify, save, defend,
and hold Issuing Lender and the other members of the Lender Group harmless with respect to any
loss, cost, expense (including reasonable attorneys fees), or liability incurred by them as a
result of the Issuing Lender’s indemnification of an Underlying Issuer; provided,
however, that Borrowers shall not be obligated hereunder to indemnify for any such loss,
cost, expense, or liability to the extent that it is caused by the gross negligence or willful
misconduct of the Issuing Lender or




24









 







any other member of the Lender Group. Borrowers hereby
acknowledge and agree that none of the Issuing Lender, any other member of the Lender Group, or any
Underlying Issuer shall be responsible for delays, errors, or omissions resulting from the
malfunction of equipment in connection with any Letter of Credit.




          (d) Borrowers hereby authorize and direct any Underlying Issuer to deliver to the Issuing
Lender all instruments, documents, and other writings and property received by such Underlying
Issuer pursuant to such Underlying Letter of Credit and to accept and rely upon the Issuing
Lender’s instructions with respect to all matters arising in connection with such Underlying Letter
of Credit and the related application.




          (e) Any and all issuance charges, usage charges, commissions, fees, and costs incurred by the
Issuing Lender relating to Underlying Letters of Credit shall be Lender Group Expenses for purposes
of this Agreement and shall be reimbursable promptly, but in any event, within one (1) Business Day
by Borrowers to Agent for the account of the Issuing Lender; it being acknowledged and agreed by
Borrowers that, as of the Closing Date, the usage charge imposed by the Underlying Issuer is one
and one-quarter of one (1.25%) percent per annum times the undrawn amount of each Underlying Letter
of Credit, that such usage charge may be changed from time to time, and that the Underlying Issuer
also imposes a schedule of charges for amendments, extensions, drawings, and renewals.




          (f) If by reason of (i) any change after the Closing Date in any applicable law, treaty, rule,
or regulation or any change in the interpretation or application thereof by any Governmental
Authority, or (ii) compliance by the Issuing Lender, any other member of the Lender Group, or
Underlying Issuer with any direction, request, or requirement (irrespective of whether having the
force of law) of any Governmental Authority or monetary authority including, Regulation D of the
Federal Reserve Board as from time to time in effect (and any successor thereto):




                    (A) any reserve, deposit, or similar requirement is or shall be imposed or modified in respect
of any Letter of Credit issued or caused to be issued hereunder or hereby, or



                    (B) there shall be imposed on the Issuing Lender, any other member of the Lender Group, or
Underlying Issuer any other condition regarding any Letter of Credit or Reimbursement Undertaking,
and the result of the foregoing is to increase, directly or indirectly, the cost to the Issuing
Lender, any other member of the Lender Group, or an Underlying Issuer of issuing, making,
guaranteeing, or maintaining any Reimbursement Undertaking or Letter of Credit or to reduce the
amount receivable in respect thereof, then, and in any such case, Agent may, at any time within a
reasonable period after the additional cost is incurred or the amount received is reduced, notify
Administrative Borrower, and Borrowers shall pay within thirty (30) days after demand therefor,
such amounts as Agent may specify to be necessary to compensate the Issuing Lender, any other
member of the Lender Group, or an Underlying Issuer for such additional cost or reduced receipt,
together with interest on such amount from the date of such demand until payment in full thereof at
the rate then applicable to Base Rate Loans hereunder; provided, however, that
Borrowers shall not be required to provide any compensation pursuant to this Section 2.11(f) for
any such amounts incurred more than one hundred eighty (180) days prior to the date on which the
demand for payment of such amounts is first made to Borrowers; provided further,
however, that if an event or circumstance giving rise to such amounts is retroactive, then
the one hundred eighty



25









 







(180) day period referred to above shall be extended to include the period
of retroactive effect thereof. The determination by Agent of any amount due pursuant to this
Section 2.11(f), as set forth in a certificate setting forth the calculation thereof in reasonable
detail, shall, in the absence of manifest or demonstrable error, be final and conclusive and
binding on all of the parties hereto.



     2.12 LIBOR Option



          (a) Interest and Interest Payment Dates. In lieu of having interest charged at the rate based
upon the Base Rate, Borrowers shall have the option, subject to Section 2.12(b) below (the “LIBOR
Option”) to have interest on all or a portion of the Advances be charged (whether at the time when
made (unless otherwise provided herein), upon conversion from a Base Rate Loan to a LIBOR Rate
Loan, or upon continuation of a LIBOR Rate Loan as a LIBOR Rate Loan) at a rate of interest based
upon the LIBOR Rate. Interest on LIBOR Rate Loans shall be payable on the earliest of (i) the last
day of the Interest Period applicable thereto; (ii) the date on which all or any portion of the
Obligations become due and payable pursuant to the terms hereof, or (iii) the date on which this
Agreement is terminated pursuant to the terms hereof. On the last day of each applicable Interest
Period, unless Borrowers properly have exercised the LIBOR Option with respect thereto, the
interest rate applicable to such LIBOR Rate Loan automatically shall convert to the rate of
interest then applicable to Base Rate Loans of the same type hereunder. At any time that an Event
of Default has occurred and is continuing, at the written election of the Required Lenders,
Borrowers no longer shall have the option to request that Advances bear interest at a rate based
upon the LIBOR Rate.




          (b) LIBOR Election.




               (i) Borrowers may, at any time and from time to time, so long as Borrowers have not received a
notice from Agent after the occurrence and during the continuance of an Event of Default of the
election of the Required Lenders to terminate the right of Borrowers to exercise the LIBOR Option
during the continuance of such Event of Default, elect to exercise the LIBOR Option by notifying
Agent prior to 2:00 p.m. at least three (3) Business Days prior to the commencement of the proposed
Interest Period (the “LIBOR Deadline”). Notice of Borrowers’ election of the LIBOR Option for a
permitted portion of the Advances and an Interest Period pursuant to this Section shall be made by
delivery to Agent of a LIBOR Notice received by Agent before the LIBOR Deadline, or by telephonic
notice received by Agent before the LIBOR Deadline (to be confirmed by delivery to Agent of a LIBOR
Notice received by Agent prior to 5:00 p.m. on the same day). Promptly upon its receipt of each
such LIBOR Notice, Agent shall provide a copy thereof to each of the affected Lenders.



               (ii) Each LIBOR Notice shall be irrevocable and binding on Borrowers. In connection with each
LIBOR Rate Loan, Borrowers shall, jointly and severally indemnify, defend, and hold Agent and the
Lenders harmless against any loss, cost, or expense actually incurred by Agent or any Lender as a
result of (A) the payment of any principal of any LIBOR Rate Loan other than on the last day of an
Interest Period applicable thereto (including as a result of an Event of Default), (B) the
conversion of any LIBOR Rate Loan other than on the last day of the Interest Period applicable
thereto, or (C) the failure to borrow, convert, continue or prepay any LIBOR Rate Loan on the date
specified in any LIBOR Notice delivered pursuant hereto (such losses, costs, or expenses, “Funding
Losses”). A certificate of Agent or a Lender delivered to Administrative Borrower setting forth in
reasonable detail any amount or amounts that Agent or such Lender is



26









 







entitled to receive pursuant to this Section 2.12 shall be conclusive absent manifest error. Borrowers shall pay such amount to
Agent or the Lender, as applicable, within thirty (30) days of the date of its receipt of such
certificate. If a payment of a LIBOR Rate Loan on a day other than the last day of the applicable
Interest Period would result in a Funding Loss, Agent may, in its sole discretion at the request of
Administrative Borrower, hold the amount of such payment as cash collateral in support
of the Obligations until the last day of such Interest Period and apply such amounts to the
payment of the applicable LIBOR Rate Loan on such last day, it being agreed that Agent has no
obligation to so defer the application of payments to any LIBOR Rate Loan and that, in the event
that Agent does not defer such application, Borrowers shall be obligated to pay any resulting
Funding Losses.



               (iii) Borrowers shall have not more than 6 LIBOR Rate Loans in effect at any given time.
Borrowers may only exercise the LIBOR Option for proposed LIBOR Rate Loans of at least $1,000,000.



          (c) Conversion. Borrowers may convert LIBOR Rate Loans to Base Rate Loans at any time;
provided, however, that in the event that LIBOR Rate Loans are converted or prepaid
on any date that is not the last day of the Interest Period applicable thereto, including as a
result of any automatic prepayment through the required application by Agent of proceeds of
Borrowers’ and their Subsidiaries’ Collections in accordance with Section 2.4(b) or for any other
reason, including early termination of the term of this Agreement or acceleration of all or any
portion of the Obligations pursuant to the terms hereof, Borrowers shall, jointly and severally
indemnify, defend, and hold Agent and the Lenders and their Participants harmless against any and
all Funding Losses in accordance with Section 2.12 (b)(ii).




          (d) Special Provisions Applicable to LIBOR Rate.




               (i) The LIBOR Rate may be adjusted by Agent with respect to any Lender on a prospective basis
to take into account any additional or increased costs to such Lender of maintaining or obtaining
any eurodollar deposits or increased costs, in each case, due to changes in applicable law
occurring subsequent to the commencement of the then applicable Interest Period, including changes
in tax laws (except changes of general applicability in corporate income tax laws but subject to
the terms of Section 16 which shall be controlling with respect to Taxes addressed in such Section)
and changes in the reserve requirements imposed by the Board of Governors of the Federal Reserve
System (or any successor), which additional or increased costs would increase the cost of funding
or maintaining loans bearing interest at the LIBOR Rate. In any such event, the affected Lender
shall give Administrative Borrower and Agent notice of such a determination and adjustment and
Agent promptly shall transmit the notice to each other Lender and, upon its receipt of the notice
from the affected Lender, Administrative Borrower may, by notice to such affected Lender (A)
require such Lender to furnish to Administrative Borrower a statement setting forth the basis for
adjusting such LIBOR Rate and the method for determining the amount of such adjustment, or (B)
repay the LIBOR Rate Loans with respect to which such adjustment is made (together with any amounts
due under Section 2.12(b)(ii)).



               (ii) In the event that any change in market conditions or any law, regulation, treaty, or
directive, or any change therein or in the interpretation or application thereof, shall at any time
after the date hereof, in the reasonable opinion of any Lender, make it unlawful or impractical for
such Lender to fund or maintain LIBOR Rate Loans or to continue such funding or maintaining,



27









 







or to determine or charge interest rates at the LIBOR Rate, such Lender shall give notice of such changed
circumstances to Agent and Administrative Borrower and Agent promptly shall transmit the notice to
each other Lender and (A) in the case of any LIBOR Rate Loans of such Lender that are outstanding,
the date specified in such Lender’s notice shall be deemed to be the last day of the Interest
Period of such LIBOR Rate Loans, and interest upon the LIBOR Rate Loans of such Lender thereafter shall accrue interest at the rate then applicable to Base Rate Loans, and (B)
Borrowers shall not be entitled to elect the LIBOR Option until such Lender determines that it
would no longer be unlawful or impractical to do so.



          (e) No Requirement of Matched Funding. Anything to the contrary contained herein
notwithstanding, neither Agent, nor any Lender, nor any of their Participants, is required actually
to acquire eurodollar deposits to fund or otherwise match fund any Obligation as to which interest
accrues at the LIBOR Rate.




     2.13 Capital Requirements.



          (a) If, after the date hereof, any Lender determines that (i) the adoption of or change in any
law, rule, regulation or guideline regarding capital or reserve requirements for banks or bank
holding companies, or any change in the interpretation, implementation, or application thereof by
any Governmental Authority charged with the administration thereof, or (ii) compliance by such
Lender or its parent bank holding company with any guideline, request or directive of any such
entity regarding capital adequacy (whether or not having the force of law), has the effect of
reducing the return on such Lender’s or such holding company’s capital as a consequence of such
Lender’s Commitments hereunder to a level below that which such Lender or such holding company
could have achieved but for such adoption, change, or compliance (taking into consideration such
Lender’s or such holding company’s then existing policies with respect to capital adequacy and
assuming the full utilization of such entity’s capital) by any amount deemed by such Lender to be
material, then such Lender may notify Administrative Borrower and Agent thereof. Following receipt
of such notice, Borrowers agree to pay such Lender on demand the amount of such reduction of return
of capital as and when such reduction is determined, payable within thirty (30) days after
presentation by such Lender of a statement in the amount and setting forth in reasonable detail
such Lender’s calculation thereof and the assumptions upon which such calculation was based (which
statement shall be deemed true and correct absent manifest error). In determining such amount,
such Lender may use any reasonable averaging and attribution methods. Failure or delay on the part
of any Lender to demand compensation pursuant to this Section shall not constitute a waiver of such
Lender’s right to demand such compensation; provided, that, Borrowers shall not be
required to compensate a Lender pursuant to this Section 2.13(a) for any reductions in return
incurred more than one hundred eighty (180) days prior to the date that such Lender notifies
Administrative Borrower of such law, rule, regulation or guideline giving rise to such reductions
and of such Lender’s intention to claim compensation therefor; provided, further,
that if such claim arises by reason of the adoption of or change in any law, rule, regulation or
guideline that is retroactive, then the one hundred eighty (180) day period referred to above shall
be extended to include the period of retroactive effect thereof.




          (b) If any Lender requests additional or increased costs referred to in Section 2.12(d)(i) or
amounts under Section 2.13(a) (any such Lender, an “Affected Lender”), then such Affected Lender
shall use reasonable efforts to promptly designate a different one of its lending offices or to



28









 






assign its rights and obligations hereunder to another of its offices or branches, if (i) in the
reasonable judgment of such Affected Lender, such designation or assignment would eliminate or
reduce amounts payable pursuant to Section 2.12(d)(i) or Section 2.13(a), as applicable, and (ii)
in the reasonable judgment of such Affected Lender, such designation or assignment would not
subject it to any material unreimbursed cost or expense and would not otherwise be materially
disadvantageous to it. Borrowers agree to pay all reasonable out-of-pocket costs and expenses
incurred by such Affected Lender in connection with any such designation or assignment. If, after
such reasonable efforts, such Affected Lender does not so designate a different one of its lending
offices or assign its rights to another of its offices or branches so as to eliminate Borrowers’
obligation to pay any future amounts to such Affected Lender pursuant to Section 2.12(d)(i) or
Section 2.13(a), as applicable, then Borrowers (without prejudice to any amounts then due to such
Affected Lender under Section 2.12(d)(i) or Section 2.13(a), as applicable) may, unless prior to
the effective date of any such assignment the Affected Lender withdraws its request for such
additional amounts under Section 2.12(d)(i) or Section 2.13(a), as applicable, may seek a
substitute Lender reasonably acceptable to Agent to purchase the Obligations owed to such Affected
Lender and such Affected Lender’s Commitments hereunder (a “Replacement Lender”), and if such
Replacement Lender agrees to such purchase, such Affected Lender shall assign to the Replacement
Lender its Obligations and Commitments, pursuant to an Assignment and Acceptance Agreement, and
upon such purchase by the Replacement Lender, such Replacement Lender shall be deemed to be a
“Lender” for purposes of this Agreement and such Affected Lender shall cease to be a “Lender” for
purposes of this Agreement.




     2.14 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 and attorney-in-fact to request and receive Advances and Letters of Credit pursuant to this
Agreement and the other Loan Documents from Agent or any Lender in the name or on behalf of such
Borrower. Agent and Lenders may disburse the Advances to such bank account of Administrative
Borrower or a Borrower or otherwise make such Advances to a Borrower and provide such Letters of
Credit to a Borrower as Administrative Borrower may designate or direct, without notice to any
other Borrower or Guarantor. Notwithstanding anything to the contrary contained herein, Agent may
at any time and from time to time require that Advances 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
and attorney-in-fact of Borrowers pursuant to this Section 2.14. Administrative Borrower shall
ensure that the disbursement of any Advances to each Borrower requested by or paid to or for the
account of any Borrower, or the issuance of any Letter of Credit 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 Loan Documents.





29












 





          (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 or Guarantor.




          (e) Administrative Borrower may resign as Administrative Borrower upon five (5) days prior
written notice to Borrowers and Agent. If Administrative Borrower resigns under this Agreement,
the Borrowers shall be entitled to appoint a successor Administrative Borrower. Upon the
acceptance of its appointment as successor Administrative Borrower hereunder, such successor
Administrative Borrower shall succeed to all the rights, powers, and duties of the retiring
Administrative Borrower and the term “Administrative Borrower” shall mean such successor
Administrative Borrower and the retiring Administrative Borrower’s appointment, powers, and duties
as Administrative Borrower shall be terminated. If no successor Administrative Borrower has
accepted appointment as Administrative Borrower by the date which is five (5) days following a
retiring Administrative Borrower’s notice of resignation, the retiring Administrative Borrower’s
resignation shall nevertheless thereupon become effective and Borrowers shall perform all of the
duties of Administrative Borrower hereunder until such time, if any, as Borrowers appoint a
successor Administrative Borrower as provided for above.




     2.15 Conversion of Guarantors to Borrower. If any Guarantor that is a Domestic
Subsidiary (a “Domestic Guarantor”) has Eligible Accounts, Eligible Ex-Im Accounts or Eligible
Inventory, Administrative Borrower may elect for such Guarantor to become a US Borrower by
executing and delivering to Agent a Guarantor Conversion Notice. Upon Agent’s receipt of a
Guarantor Conversion Notice, duly executed by Administrative Borrower and properly completed which
requests that a Domestic Guarantor become a US Borrower, Agent shall promptly countersign such
Guarantor Conversion Notice, whereupon such Domestic Guarantor shall automatically become a US
Borrower and shall cease to be a Guarantor.


3. CONDITIONS; TERM OF AGREEMENT.




     3.1 Conditions Precedent to the Initial Extension of Credit. The obligation of each
Lender to make its initial extension of credit provided for hereunder is subject to the
fulfillment, to the satisfaction of Agent and the Lenders, of each of the conditions precedent set
forth on Schedule 3.1 (the making of such initial extension of credit by a Lender being
conclusively deemed to be its satisfaction or waiver of the conditions precedent ).



     3.2 Conditions Precedent to all Extensions of Credit. The obligation of the Lender
Group (or any member thereof) to make any Advances hereunder (or to extend any other credit
hereunder) at any time shall be subject to the following conditions precedent:



          (a) the representations and warranties of Parent or its Subsidiaries contained in this
Agreement or in the other Loan Documents shall be true and correct in all material respects
(except, that, such materiality qualifier shall not be applicable to any representations and
warranties that already are qualified or modified by materiality in the text thereof) on and as of
the date of such extension of credit, as though made on and as of such date (except to the extent
that such representations and warranties relate solely to an earlier date); and







30









 








          (b) no Default or Event of Default shall have occurred and be continuing on the date of such
extension of credit, nor shall either result from the making thereof.




     3.3 Maturity. This Agreement shall be in full force and effect for a term ending on
February 13, 2015 (the “Maturity Date”). The foregoing notwithstanding, the Lender Group, upon the
election of the Required Lenders, shall have the right to terminate its obligations under this
Agreement immediately and without notice upon the occurrence and during the continuation of an
Event of Default.



     3.4 Effect of Maturity. On the Maturity Date, all commitments of the Lender Group to
provide additional credit hereunder shall automatically be terminated and all of the Obligations
immediately shall become due and payable without notice or demand and Borrowers shall be required
to repay all of the Obligations in full; provided, that, on the Ex-Im Maturity
Date, all commitments of the Lender Group to provide Ex-Im Advances shall automatically be
terminated and the outstanding principal amount of the Ex-Im Advances and all interest and fees
accrued thereon immediately shall become due and payable without notice or demand and shall be paid
by Borrowers in full. No termination of the obligations of the Lender Group (other than payment in
full of the Obligations and termination of the Commitments) shall relieve or discharge any Loan
Party of its duties, obligations, or covenants hereunder or under any other Loan Document and
Agent’s Liens in the Collateral shall continue to secure the Obligations and shall remain in effect
until all Obligations have been paid in full and the Commitments have been terminated. When all of
the Obligations have been paid in full and the Lender Group’s obligations to provide additional
credit under the Loan Documents have been terminated irrevocably, Agent will, at Borrowers’ sole
expense, execute and deliver any termination statements, lien releases, discharges of security
interests, and other similar discharge or release documents (and, if applicable, in recordable
form) as Borrowers may reasonably request to release, as of record, Agent’s Liens and all notices
of security interests and liens previously filed by Agent.



     3.5 Early Termination by Borrowers. Borrowers have the option, at any time upon ten
(10) Business Days prior written notice to Agent, to terminate this Agreement and terminate the
Commitments hereunder by repaying to Agent all of the Obligations in full.


4. REPRESENTATIONS AND WARRANTIES.




     In order to induce the Lender Group to enter into this Agreement, Borrowers jointly and
severally make the following representations and warranties to the Lender Group which shall be
true, correct, and complete, in all material respects (except, that, such materiality qualifier
shall not be applicable to any representations and warranties that already are qualified or
modified by materiality in the text thereof), as of the Closing Date, and shall be true, correct,
and complete, in all material respects (except, that, such materiality qualifier shall not be
applicable to any representations and warranties that already are qualified or modified by
materiality in the text thereof), as of the date of the making of each Advance made (or each Letter
of Credit issued) thereafter, as though made on and as of the date of such Advance or such issuance
(except to the extent that such representations and warranties relate solely to an earlier date)
and such representations and warranties shall survive the execution and delivery of this Agreement:



     4.1 Due Organization and Qualification; Subsidiaries



31









 





          (a) Each Loan Party (i) is duly organized and existing and in good standing under the laws of
the jurisdiction of its organization, (ii) is qualified to do business in any state where material
assets are located or where necessary to conduct its business, except where the failure to be in
good standing or so qualified could not reasonably be expected to result in a Material Adverse
Change, and (iii) has all requisite power and authority to own and operate its properties, to carry
on its business as now conducted and as proposed to be conducted, to enter into the Loan Documents
to which it is a party and to carry out the transactions contemplated thereby.




          (b) Set forth on Schedule 4.1(b) is a complete and accurate description as of the Closing Date
of the authorized Equity Interests of each Loan Party, by class, and, as of the Closing Date, a
description of the number of shares of each such class that are issued and outstanding. Other than
as described on Schedule 4.1(b), as of the Closing Date, there are no subscriptions, options,
warrants, or calls relating to any shares of each Loan Party’s Equity Interests, including any
right of conversion or exchange under any outstanding security or other instrument. No Loan Party
is subject to any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire
any shares of its Equity Interests or any security convertible into or exchangeable for any of its
Equity Interests.




          (c) As of the Closing Date, set forth on Schedule 4.1(c) (as such Schedule may be
updated from time to time to reflect changes resulting from transactions permitted under this
Agreement), is a complete and accurate list of the Loan Parties’ direct and indirect Subsidiaries,
showing: (i) the number of shares of each class of common and preferred Equity Interests
authorized for each of such Subsidiaries, and (ii) the number and the percentage of the outstanding
shares of each such class owned directly or indirectly by each Borrower. All of the outstanding
Equity Interests of each such Subsidiary has been validly issued and is fully paid and
non-assessable.




          (d) Except as set forth on Schedule 4.1(c), as of the Closing Date, there are no
subscriptions, options, warrants, or calls relating to any shares of any Loan Party’s Subsidiaries’
Equity Interests, including any right of conversion or exchange under any outstanding security or
other instrument. Neither any Loan Party’s nor any Subsidiaries of any Loan Party is subject to
any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire any shares of
any Loan Party’s Subsidiaries’ Equity Interests or any security convertible into or exchangeable
for any such Equity Interests.




     4.2 Due Authorization; No Conflict.



          (a) As to each Loan Party, the execution, delivery, and performance by such Loan Party of the
Loan Documents to which it is a party have been duly authorized by all necessary action on the part
of such Loan Party.




          (b) As to each Loan Party, the execution, delivery, and performance by such Loan Party of the
Loan Documents to which it is a party do not and will not (i) violate any provision of federal,
state, or local law or regulation applicable to any Loan Party or its Subsidiaries, the Governing
Documents of any Loan Party or its Subsidiaries, or any order, judgment, or decree of any court or
other Governmental Authority binding on any Loan Party or its Subsidiaries, except to the extent
that any such violation could not individually or in the aggregate reasonably be expected to have a
Material Adverse Change, (ii) conflict with, result in a breach of, or constitute (with due






32









 







notice or lapse of time or both) a default under any agreement, document or instrument of any
Loan Party or its Subsidiaries except to the extent that any such conflict, breach or default could
not individually or in the aggregate reasonably be expected to have a Material Adverse Change,
(iii) result in or require the creation or imposition of any Lien of any nature whatsoever upon any
assets of any Loan Party, other than Permitted Liens, or (iv) require any approval of any Loan
Party’s interest holders or any approval or consent of any Person under any agreement, document or
instrument of any Loan Party, other than consents or approvals that have been obtained on or prior
to the date hereof and that are still in force and effect and except, in the case of Material
Contracts, for consents or approvals, the failure to obtain could not individually or in the
aggregate reasonably be expected to have a Material Adverse Change.




     4.3 Governmental Consents. The execution, delivery, and performance by each Loan
Party of the Loan Documents to which such Loan Party is a party and the consummation of the
transactions contemplated by the Loan Documents do not and will not require any registration with,
consent, or approval of, or notice to, or other action with or by, any Governmental Authority,
other than registrations, consents, approvals, notices, or other actions that have been obtained on
or prior to the date hereof and that are still in force and effect and except for filings and
recordings with respect to the Collateral to be made, or otherwise delivered to Agent for filing or
recordation, as of the Closing Date and except where the failure to obtain the foregoing could not
individually or in the aggregate reasonably be expected to have a Material Adverse Change.



     4.4 Binding Obligations; Perfected Liens.



          (a) Each Loan Document has been duly executed and delivered by each Loan Party that is a party
thereto and is the legally valid and binding obligation of such Loan Party, enforceable against
such Loan Party in accordance with its respective terms, except as enforcement may be limited by
equitable principles relating to enforceability or by bankruptcy, insolvency, reorganization,
moratorium, or similar laws relating to or limiting creditors’ rights generally.




          (b) Agent’s Liens are validly created, perfected under the laws of the United States (other
than (i) in respect of motor vehicles that are subject to a certificate of title and as to which
Agent has not caused its Lien to be noted on the applicable certificate of title, (ii) any Deposit
Accounts and Securities Accounts not subject to a Control Agreement as permitted by Section 6.11
and (iii) patents, copyrights or trademarks in respect of which no intellectual property security
agreement or similar agreement granting a security interest in the applicable intellectual property
has been filed with the United States Patent and Trademark Office or the United States Copyright
Office, as applicable), and first priority Liens (in the case of Revolving Loan Priority
Collateral) or second priority Liens (in the case of Term Loan Priority Collateral), subject only
to Permitted Liens for which priority is accorded by operation of law or other Permitted Liens
which are permitted to be senior to Agent’s Lien pursuant to this Agreement.




     4.5 Title to Assets; No Encumbrances. Each of the Loan Parties and its Subsidiaries
has (i) good, sufficient and legal title to (in the case of fee interests in Real Property), (ii)
valid leasehold interests in (in the case of leasehold interests in real or personal property), and
(iii) good and marketable title to (in the case of all other personal property), all of their
respective assets reflected in their most recent financial statements delivered pursuant to Section
5.1, in each case except (A) for assets disposed of since the date of such financial statements to
the extent permitted



33









 




hereby or (B) as individually or in the aggregate could not reasonably be expected to have a
Material Adverse Change. All of such assets are free and clear of Liens except for Permitted
Liens.




     4.6 Jurisdiction of Organization; Location of Chief Executive Office; Organizational
Identification Number; Commercial Tort Claims



          (a) The name of (within the meaning of Section 9-503 of the UCC) and jurisdiction of
organization of each Loan Party and each of its Subsidiaries as of the Closing Date is set forth on
Schedule 4.6(a) (as such Schedule may be updated from time to time to reflect changes resulting
from transactions permitted under this Agreement).




          (b) The chief executive office of each Loan Party and each of its Subsidiaries is located at
the address indicated on Schedule 4.6(b) (as such Schedule may be updated from time to time
to reflect changes resulting from transactions permitted under this Agreement).




          (c) Each Loan Party’s and each of its Subsidiaries’ tax identification numbers and
organizational identification numbers, if any, as of the Closing Date, are identified on
Schedule 4.6(c) (as such Schedule may be updated from time to time to reflect changes
resulting from transactions permitted under this Agreement).




          (d) As of the Closing Date, no Loan Party holds any commercial tort claims that exceed
$250,000 in amount, except as set forth on Schedule 4.6(d).




     4.7 Litigation.



          (a) There are no actions, suits, or proceedings pending or, to the knowledge of any Borrower,
after due inquiry, threatened in writing against a Loan Party or any of its Subsidiaries that
either individually or in the aggregate could reasonably be expected to result in a Material
Adverse Change.




          (b) Schedule 4.7(b) sets forth a complete and accurate description, with respect to
each of the actions, suits, or proceedings with asserted liabilities, or that could reasonably be
expected to result in liabilities, in an amount that could reasonably be expected to result in a
Material Adverse Change that, as of the Closing Date, is pending or, to the knowledge of any
Borrower, after due inquiry, threatened against a Loan Party or any of its Subsidiaries, of (i) the
parties to such actions, suits, or proceedings, (ii) the nature of the dispute that is the subject
of such actions, suits, or proceedings, (iii) the status, as of the Closing Date, with respect to
such actions, suits, or proceedings, and (iv) whether any liability of the Loan Parties’ and their
Subsidiaries in connection with such actions, suits, or proceedings is covered by insurance.




     4.8 Compliance with Laws. No Loan Party nor any of its Subsidiaries (a) is in
violation of any applicable laws, rules, regulations, executive orders, or codes (including
Environmental Laws) that, individually or in the aggregate, could reasonably be expected to result
in a Material Adverse Change, or (b) is subject to or in default with respect to any final
judgments, writs, injunctions, decrees, rules or regulations of any court or any federal, state,
municipal or other governmental department, commission, board, bureau, agency or instrumentality,
domestic or



34









 




foreign, that, individually or in the aggregate, could reasonably be expected to result in a
Material Adverse Change.




     4.9 No Material Adverse Change. All historical financial statements for the periods
from December 31, 2008 through November 30, 2010 relating to the Loan Parties and their
Subsidiaries that have been delivered by Borrowers to Agent have been prepared in accordance with
GAAP (except, in the case of unaudited financial statements, for the lack of footnotes and being
subject to year-end audit adjustments and fresh start accounting) and present fairly in all
material respects, the Loan Parties’ and their Subsidiaries’ consolidated financial condition as of
the date thereof and results of operations for the period then ended. Since entry of the
Confirmation Order, no event, circumstance, or change has occurred that has or could reasonably be
expected to result in a Material Adverse Change.



     4.10 Fraudulent Transfer.



          (a) As of the Closing Date, the Loan Parties, collectively, are Solvent.




          (b) No transfer of property is being made by any Loan Party and no obligation is being
incurred by any Loan Party in connection with the transactions contemplated by this Agreement or
the other Loan Documents with the intent to hinder, delay, or defraud either present or future
creditors of such Loan Party.




     4.11 Employee Benefits. As of the date hereof, no Loan Party, none of their
Subsidiaries, nor any of their ERISA Affiliates maintains or contributes to any Benefit Plan,
except as set forth on Schedule 4.11.



     4.12 Environmental Condition. Except with respect to the Henderson Legacy Conditions
(for which each Loan Party has received either a covenant not to sue or, the extent allowable under
applicable laws, a release from Governmental Authorities pursuant to the Environmental Claims
Settlement Agreement) and except where any of the following could not individually or in the
aggregate reasonably be expected to have a Material Adverse Change, (a) no Loan Party’s nor any of
its Subsidiaries’ properties has ever been used by a Loan Party or its Subsidiaries in the disposal
of, or to produce, store, handle, treat, release, or transport, any Hazardous Materials, where such
disposal, production, storage, handling, treatment, release or transport was in violation of any
applicable Environmental Law, (b) to each Borrower’s knowledge, no Loan Party’s nor any of its
Subsidiaries’ properties has ever been designated or identified in any manner pursuant to any
environmental protection statute as a Hazardous Materials disposal site, (c) no Loan Party nor any
of its Subsidiaries has received written notice that a Lien arising under any Environmental Law has
attached to any properties owned or operated by a Loan Party or its Subsidiaries, and (d) no Loan
Party nor any of its Subsidiaries nor any of their respective currently owned or operated
facilities or ongoing operations is subject to any outstanding written order, consent decree, or
settlement agreement with any Person relating to any Environmental Law or Environmental Liability,
except the Environmental Claims Settlement Agreement, the Environmental Response Trust Agreements
and the Anadarko Litigation Trust Agreement (as each such term is defined in the Chapter 11 Plan)
and any ancillary documents related thereto. Pursuant to the Environmental Claims Settlement
Agreement, each Loan Party has received either a covenant



35









 




not to sue or, to the extent allowable under applicable laws, a release from Governmental
Authorities with respect to the Henderson Legacy Conditions.




     4.13 Intellectual Property. Each Loan Party and its Subsidiaries own, or hold
licenses in or other rights to use, all trademarks, trade names, copyrights and patents that are
necessary to the conduct of its business as currently conducted, except where the failure to own,
hold licenses in, or otherwise have a right to use could not reasonably be expected, individually
or in the aggregate, to have a Material Adverse Change, and attached hereto as Schedule
4.13 (as updated from time to time) is a true, correct, and complete listing of all material
trademarks registrations and applications, copyright registrations and applications, and patents
and patent applications as to which any Loan Party or one of its Subsidiaries is the owner;
provided, however, that Borrowers may amend Schedule 4.13 to add additional
material intellectual property as described above which the applicable Loan Party or its Subsidiary
may have acquired after the date hereof, so long as such amendment occurs by written notice to
Agent within thirty (30) days of the end of the calendar quarter in which such intellectual
property was acquired.



     4.14 Leases. Each Loan Party and its Subsidiaries enjoy peaceful and undisturbed
possession under all leases material to their business and to which they are parties or under which
they are operating, and, subject to Permitted Protests, all of such material leases are valid and
subsisting and to the Borrowers’ knowledge, no material default by the applicable Loan Party or its
Subsidiaries exists under any of them.



     4.15 Deposit Accounts and Securities Accounts. Set forth on Schedule 4.15 (as
updated pursuant to the provisions of the Security Agreement from time to time) is a listing of all
of the Loan Parties’ Deposit Accounts and Securities Accounts as of the Closing Date, including,
with respect to each bank or securities intermediary (a) the name and address of such Person, and
(b) the account numbers of the Deposit Accounts or Securities Accounts maintained with such Person.



     4.16 Complete Disclosure. All factual information taken as a whole (other than
forward-looking information and projections and information of a general economic nature and
general information about Borrowers’ industry) furnished by or on behalf of a Loan Party or its
Subsidiaries in writing to Agent or any Lender (including all information contained in the
Schedules hereto or in the other Loan Documents) for purposes of or in connection with this
Agreement or the other Loan Documents, and all other such factual information taken as a whole
(other than forward-looking information and projections and information of a general economic
nature and general information about Borrowers’ industry) hereafter furnished by or on behalf of a
Loan Party or its Subsidiaries in writing to Agent or any Lender will be, true and accurate, in all
material respects, on the date as of which such information is dated or certified and not
incomplete by omitting to state any fact necessary to make such information (taken as a whole) not
misleading in any material respect at such time in light of the circumstances under which such
information was provided. The Projections delivered to Agent on September 9, 2010 represent, and
as of the date on which any other Projections are delivered to Agent, such additional Projections
represent, Borrowers’ good faith estimate, on the date such Projections are or were delivered, of
the Loan Parties’ and their Subsidiaries’ future performance for the periods covered thereby based
upon assumptions believed by Borrowers to be reasonable at the time of the delivery thereof to
Agent (it being understood that such Projections are subject to uncertainties and contingencies,
many of which are beyond the control of the Loan Parties and their Subsidiaries and are not to be
viewed as facts, that no



36









 




assurances can be given that such Projections will be realized, and that actual results may
differ in a material manner from such Projections).




     4.17 Material Contracts. Set forth on Schedule 4.17 (as such Schedule may be
updated from time to time in accordance herewith) is a list of the Material Contracts of each Loan
Party and its Subsidiaries as of the Closing Date; provided, however, that
Borrowers may amend Schedule 4.17 to add additional Material Contracts so long as such
amendment occurs by written notice to Agent on the date that Borrowers provides a Compliance
Certificate. Except for matters which, either individually or in the aggregate, could not
reasonably be expected to result in a Material Adverse Change, each Material Contract (other than
those that have expired at the end of their normal terms) is in full force and effect and is
binding upon and enforceable against the applicable Loan Party or its Subsidiary and, to Borrowers’
knowledge, after due inquiry, each other Person that is a party thereto in accordance with its
terms and is not in default due to the action or inaction of the applicable Loan Party or
Subsidiary.



     4.18 Patriot Act. To the extent applicable, each Loan Party is in compliance, in all
material respects, with the (a) Trading with the Enemy Act, as amended, and each of the foreign
assets control regulations of the United States Treasury Department (31 CFR, Subtitle B, Chapter V,
as amended) and any other enabling legislation or executive order relating thereto, and (b)
Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct
Terrorism (USA Patriot Act of 2001) (the “Patriot Act”). No part of the proceeds of the loans made
hereunder will be used by any Loan Party or any of their Affiliates, directly or indirectly, for
any payments to any governmental official or employee, political party, official of a political
party, candidate for political office, or anyone else acting in an official capacity, in order to
obtain, retain or direct business or obtain any improper advantage, in violation of the United
States Foreign Corrupt Practices Act of 1977, as amended.



     4.19 Reserved.



     4.20 Payment of Taxes. Except as otherwise permitted under Section 5.5, all tax
returns and reports of each Loan Party and its Subsidiaries required to be filed by any of them
have been timely filed, and all taxes shown on such tax returns to be due and payable and all
governmental assessments, fees and charges upon a Loan Party and its Subsidiaries or upon their
respective assets that are due and payable have been paid when due and payable. No Borrower knows
of any proposed tax assessment against a Loan Party or any of its Subsidiaries that is not being
actively contested by such Loan Party or such Subsidiary diligently, in good faith, and by
appropriate proceedings; provided such reserves or other appropriate provisions, if any, as shall
be required in conformity with GAAP shall have been made or provided therefor.



     4.21 Margin Equity Interests. No Loan Party nor any of its Subsidiaries is engaged
principally, or as one of its important activities, in the business of extending credit for the
purpose of purchasing or carrying any Margin Equity Interests. No part of the proceeds of the
loans made to Borrowers will be used to purchase or carry any such Margin Equity Interests or to
extend credit to others for the purpose of purchasing or carrying any such margin stock or for any
purpose that violates the provisions of Regulation T, U or X of the Board of Governors of the
United States Federal Reserve.



37









 





     4.22 Governmental Regulation. No Loan Party nor any of its Subsidiaries is subject to
regulation under the Federal Power Act or the Investment Company Act of 1940 or under any other
federal or state statute or regulation which may limit its ability to incur Indebtedness or which
may otherwise render all or any portion of the Obligations unenforceable. No Loan Party nor any of
its Subsidiaries is a “registered investment company” or a company “controlled” by a “registered
investment company” or a “principal underwriter” of a “registered investment company” as such terms
are defined in the Investment Company Act of 1940.



     4.23 OFAC. No Loan Party nor any of its Subsidiaries is in violation of any of the
country or list based economic and trade sanctions administered and enforced by OFAC. No Loan
Party nor any of its Subsidiaries (a) is a Sanctioned Person or a Sanctioned Entity, (b) has its
assets located in Sanctioned Entities, or (c) derives revenues from investments in, or
transactions with Sanctioned Persons or Sanctioned Entities. No proceeds of any loan or other
financial accommodation made or provided hereunder will be used to fund any operations in, finance
any investments or activities in, or make any payments to, a Sanctioned Person or a Sanctioned
Entity.



     4.24 Employee and Labor Matters. Except as could not individually or in the aggregate
reasonably be expected to have a Material Adverse Change, there is (a) no unfair labor practice
complaint pending or, to the knowledge of any Borrower, threatened against any Loan Party or any
Subsidiary of any Loan Party before any Governmental Authority and no grievance or arbitration
proceeding pending or, to the knowledge of any Borrower, threatened against any Loan Party or any
Subsidiary of any Loan Party which arises out of or under any collective bargaining agreement, (b)
no strike, slowdown, work stoppage or other material labor dispute pending or, to the knowledge of
any Borrower, threatened against any Loan Party or any Subsidiary of any Loan Party, or (c) to the
knowledge of Loan Parties, no union representation question existing with respect to the employees
of any Loan Party or any Subsidiary of any Loan Party and no union organizing activity taking place
with respect to any of the employees of any Loan Party or any Subsidiary of any Loan Party. No
Loan Party or any Subsidiary of any Loan Party has incurred any liability or obligation under the
Worker Adjustment and Retraining Notification Act or similar state law, which remains unpaid or
unsatisfied, except as could not reasonably be expected to result in a Material Adverse Change.
The hours worked and payments made to employees of any Loan Party or any Subsidiary of any Loan
Party have not been in violation of the Fair Labor Standards Act or any other applicable legal
requirements, except to the extent such violations could not, individually or in the aggregate,
reasonably be expected to result in a Material Adverse Change. All material payments due from any
Loan Party or any Subsidiary of any Loan Party on account of wages and employee health and welfare
insurance and other benefits have been paid or accrued as a liability on the books of Loan Parties,
except where the failure to do so could not, individually or in the aggregate, reasonably be
expected to result in a Material Adverse Change.



     4.25 Term Loan Documents; Equity Contribution Documents.



          (a) As of the Closing Date, Borrowers have delivered to Agent true and correct copies of the
Term Loan Agreement and the other material Term Loan Documents. As of the Closing Date, no party
to the Term Loan Documents which is a Loan Party or an Affiliate thereof is in default in the
performance or compliance with any provisions thereof. The Term Loan Documents are in full force
and effect as of the Closing Date and have not been terminated, rescinded or withdrawn as of such
date. Other than entry by the Bankruptcy Court of the Confirmation Order, the execution,






38









 







delivery and performance of the Term Loan Documents do not and will not require any
registration with, consent, or approval of, or notice to, or other action with or by, any
Governmental Authority, other than consents or approvals that have been obtained and that are still
in full force and effect.




          (b) As of the Closing Date, Borrowers have delivered to Agent true and correct copies of the
Equity Commitment Agreement and the other material Equity Contribution Documents. As of the
Closing Date, no party to the Equity Contribution Documents is in default in the performance or
compliance with any provisions thereof and the Equity Contribution Documents comply in all material
respects with all applicable laws. The Equity Contribution Documents are in full force and effect
as of the Closing Date and have not been terminated, rescinded or withdrawn as of such date. Other
than the entry by the Bankruptcy Court of the Confirmation Order, the execution, delivery and
performance of the Equity Contribution Documents do not and will not require any registration with,
consent, or approval of, or notice to, or other action with or by, any Governmental Authority,
other than consents or approvals that have been obtained and that are still in full force and
effect.




     4.26 Confirmation Order. Borrowers have delivered to Administrative Borrower a
complete and correct copy of the Chapter 11 Plan and the Confirmation Order (including all
schedules, exhibits, amendments, supplements, modifications, assignments and all other documents
delivered pursuant thereto or in connection therewith). Borrowers and Guarantors are not in
default in the performance of or compliance with any provisions of the Chapter 11 Plan. The
Chapter 11 Plan is in full force and effect as of the date hereof and has not been terminated,
rescinded or withdrawn, and the Effective Date has occurred. The Confirmation Order is a Final
Order and is in full force and effect, and has not been amended, modified or stayed. All
conditions to confirmation and effectiveness of the Chapter 11 Plan have been satisfied or validly
waived pursuant to the Chapter 11 Plan (other than conditions consisting of the effectiveness of
this Agreement). No court of competent jurisdiction has issued any injunction, restraining order
or other order which prohibits consummation of the transactions described in the Confirmation Order
and no governmental or other action or proceeding has been commenced, seeking any injunction,
restraining order or other order which seeks to void or otherwise modify the transactions described
in the Confirmation Order.



     4.27 Eligible Accounts. As to each Account that is identified by Borrowers as an
Eligible Account or Eligible Foreign Account in a Borrowing Base Certificate or Ex-Im Borrowing
Base Certificate submitted to Agent, such Account is (a) a bona fide existing payment obligation of
the applicable Account Debtor created by the sale of Inventory or the rendition of services to such
Account Debtor in the ordinary course of a Borrower’s business, (b) owed to a Borrower without any
known defenses, disputes, rights of setoff, counterclaims, or rights of return or cancellation, and
(c) not excluded as ineligible by virtue of one or more of the excluding criteria (other than
Agent-discretionary criteria) set forth in the definition of Eligible Accounts or Eligible Foreign
Accounts, as applicable. As to each Environmental Insurance Receivable that is identified by
Borrowers as an Eligible Insurance Account in a Borrowing Base Certificate submitted to Agent, such
Environmental Insurance Receivable is (a) a bona fide existing payment obligations of the
Environmental Insurer pursuant to the Environmental Insurance Policy, (b) owed to Worldwide
without any known defenses, disputes, offsets, counterclaims, or rights of return or cancellation
(except as identified by the Borrower in the Borrowing Base Certificate), and (c) not excluded as
ineligible by virtue of one or more of the excluding criteria (other than Agent-discretionary
criteria) set forth in the definition of Eligible Insurance Accounts.




39












 





     4.28 Eligible Inventory. As to each item of Inventory that is identified by
Borrowers as Eligible Inventory or Eligible In-Transit Inventory in a Borrowing Base Certificate
submitted to Agent, such Inventory is not excluded as ineligible by virtue of one or more of the
excluding criteria (other than Agent-discretionary criteria) set forth in the definition of
Eligible Inventory or Eligible In-Transit Inventory, as applicable.



     4.29 Locations of Inventory and Equipment. The Inventory and Equipment (other
than vehicles or Equipment in-transit or out for repair or Inventory in-transit) of the Loan
Parties are not stored with a bailee, warehouseman, or similar party except as identified on
Schedule 4.29 (as such Schedule may be updated pursuant to Section 5.15) and are located only at,
or in-transit between or to, the locations identified on Schedule 4.29 (as such Schedule may be
updated pursuant to Section 5.15).



     4.30 Inventory Records. Each Loan Party keeps correct and accurate records
consistent with past practices itemizing and describing the type, quality, and quantity of its
Inventory and the book value thereof.



     4.31 Replacement Revolving Facility. This Agreement constitutes a “Replacement
Revolving Facility” under and as defined in the Term Loan Agreement as in effect on the date
hereof, and as of the Closing Date, there exists no other Replacement Revolving Facility.



     4.32 Indebtedness to Specified Subsidiaries. As of the date hereof, no Loan Party
has any Indebtedness for borrowed money owing to any of the Specified Subsidiaries.


5. AFFIRMATIVE COVENANTS.




     Each Loan Party covenants and agrees that, until termination of all of the Commitments and
payment in full of the Obligations, the Loan Parties shall and shall cause each of their
Subsidiaries to comply with each of the following:



     5.1 Financial Statements, Reports, Certificates. Deliver to Agent, for
distribution to each Lender, each of the financial statements, reports, and other items set forth
on Schedule 5.1 no later than the times specified therein. In addition, each Borrower
agrees that no Subsidiary of a Loan Party will have a fiscal year different from that of Borrowers.
In addition, each Borrower agrees to maintain a system of accounting that enables Borrowers to
produce financial statements in accordance with GAAP.



     5.2 Collateral Reporting. Provide Agent with each of the reports set forth on
Schedule 5.2 at the times specified therein. In addition, Borrowers agree to use
commercially reasonable efforts in cooperation with Agent to facilitate and implement a system of
electronic collateral reporting in order to provide electronic reporting of each of the items set
forth on such Schedule.



     5.3 Existence. Except as otherwise permitted in Section 6.3 or 6.4, at all times
maintain and preserve in full force and effect (a) its existence and (b) all rights and franchises,
licenses and permits material to its business; except (in the case of this clause (b)) where the
failure so to maintain or preserve could not individually or in the aggregate reasonably be
expected to have a Material Adverse Change.



40









 





     5.4 Maintenance of Properties. Maintain and preserve all of its assets that are
necessary or useful in the proper conduct of its business in good working order and condition,
ordinary wear, tear, and casualty excepted and Permitted Dispositions excepted, and comply with the
material provisions of all material leases to which it is a party as lessee, so as to prevent the
loss or forfeiture thereof, unless such provisions are the subject of a Permitted Protest, in each
case except where the failure to do any of the foregoing could not individually or in the aggregate
reasonably be expected to have a Material Adverse Change



     5.5 Taxes. Cause all material assessments and material taxes imposed, levied, or
assessed against any Loan Party or its Subsidiaries or any of their respective assets or in respect
of any of its income, businesses, or franchises to be paid in full, before delinquency or before
the expiration of any extension period, except to the extent that the validity of such assessment
or tax shall be the subject of a Permitted Protest and so long as, in the case of an assessment or
tax that has become a Lien against any of the Collateral, such contest proceedings operate to stay
the sale of any portion of the Collateral to satisfy such assessment or tax. The Loan Parties will
and will cause each of their Subsidiaries to make timely payment or deposit of all material tax
payments and withholding taxes required of them by applicable laws, including those laws concerning
F.I.C.A., F.U.T.A., state disability, and local, state, and federal income taxes, except where the
failure to make such payment or deposit could not individually or in the aggregate reasonably be
expected to have a Material Adverse Change.



     5.6 Insurance. At Borrowers’ expense, maintain, with financially sound and
reputable insurers, such public liability insurance, third party property damage insurance,
business interruption insurance and casualty insurance with respect to liabilities, losses or
damage in respect of the assets, properties and businesses of Parent and its Subsidiaries as are
customarily carried or maintained under similar circumstances by Persons of established reputation
engaged in similar businesses, in each case in such amounts (giving effect to self-insurance), with
such deductibles, covering such risks and otherwise on such terms and conditions as shall be
reasonable and customary for such Persons. Without limiting the generality of the foregoing,
Borrower’s and Guarantors will maintain or cause to be maintained (a) flood insurance with respect
to each Flood Hazard Property that is located in a community that participates in the National
Flood Insurance Program, in each case in compliance with any applicable regulations of the Board of
Governors of the Federal Reserve System, and (b) replacement value casualty insurance on the
Collateral under such policies of insurance, with such insurance companies, in such amounts, with
such deductibles, and covering such risks as are at all times carried or maintained under similar
circumstances by Persons of established reputation engaged in similar businesses. Each such policy
of insurance shall (i) name Agent as an additional insured thereunder as its interests may appear,
(ii) in the case of each casualty insurance policy, contain a loss payable endorsement,
satisfactory in form and substance to Agent, that names Agent as the loss payee thereunder and
provide for at least thirty days’ prior written notice to Agent of any modification or cancellation
of such policy. Administrative Borrower shall give Agent prompt notice of any loss exceeding
$750,000 covered by its casualty or business interruption insurance.



     5.7 Inspection. Permit Agent and each of its duly authorized representatives or
agents to visit any domestic properties of any Loan Party and inspect any of its assets
constituting Revolving Loan Priority Collateral or books and records, to conduct appraisals and
valuations of assets included in the Borrowing Base, to examine and make copies of its books and
records, and to discuss its affairs, finances, and accounts with, and to be advised as to the same
by, its officers and management



41









 




employees at such reasonable times and intervals as Agent may
designate and, so long as no Event of Default exists, with reasonable prior notice to Administrative
Borrower; provided, that, so long as no Event of Default exists, Loan Parties’
shall not be liable for (a) the costs and expenses of more than two (2) inventory appraisals
during each fiscal year (exclusive of the appraisals delivered pursuant to Schedule 3.1) or (b)
the costs and expenses of more than two (2) such visits and inspections (or, if Excess Availability
is less than $25,000,000, three (3) such visits and inspections) during each fiscal year (exclusive
of the visits and inspections conducted pursuant to Schedule 3.1).




     5.8 Compliance with Laws. Comply with the requirements of all applicable laws,
rules, regulations, and orders of any Governmental Authority (except Environmental Laws which are
covered by Section 5.9), other than laws, rules, regulations, and orders the non-compliance with
which, individually or in the aggregate, could not reasonably be expected to result in a Material
Adverse Change.



     5.9 Environmental. Except (in the case of clause (a) or (b) below) where the
failure to do any of the following could not individually or in the aggregate reasonably be
expected to have a Material Adverse Change:



          (a) Keep any property either owned or operated by any Loan Party or any Subsidiary of any Loan
Party, free of any Environmental Liens or post bonds or other financial assurances sufficient to
satisfy the obligations or liability evidenced by such Environmental Liens,




          (b) Comply with Environmental Laws and provide to Agent documentation of such compliance which
Agent reasonably requests in writing; (provided, that, the obligations of each Loan
Party and its Subsidiaries to comply with Environmental Laws with respect to the Henderson Legacy
Environmental Conditions shall be subject to the terms of the Environmental Claims Settlement
Agreement),




          (c) Promptly notify Agent of any release, except with respect to the Henderson Legacy
Conditions, of which any Borrower has knowledge of a Hazardous Material in any reportable quantity
from or onto property owned or operated by any Loan Party or any Subsidiary of any Loan Party and
take any Remedial Actions required by applicable Environmental Law to abate said release or
otherwise to come into compliance, in all material respects, with applicable Environmental Law,
except for such release which could not individually or in the aggregate reasonably be expected to
have a Material Adverse Change (provided, that, the obligations of each Loan Party
and its Subsidiaries to take Remedial Actions required by Environmental Laws with respect to the
Henderson Legacy Environmental Conditions shall be subject to the terms of the Environmental Claims
Settlement Agreement), and




          (d) Promptly, but in any event within ten (10) Business Days of its receipt thereof, provide
Agent with written notice of any of the following: (i) written notice that an Environmental Lien
has been filed against any material real or personal property of any Loan Party or any Subsidiary
of any Loan Party, (ii) commencement of any Environmental Action or written notice that an
Environmental Action will be filed against any Loan Party, and (iii) written notice of a violation,
citation, or other administrative order from a Governmental Authority
under Environmental Laws which (in the case of clause (ii) or (iii) above) could individually
or in the aggregate reasonably be expected to have a Material Adverse Change.




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     5.10 Disclosure Updates. Promptly and in no event later than seven (7) Business
Days after obtaining knowledge thereof, notify Agent if any written information, exhibit, or report
furnished to Agent or the Lenders contained, at the time it was furnished, any untrue statement of
a material fact or omitted to state any material fact necessary to make the statements contained
therein not misleading in light of the circumstances in which made. The foregoing to the contrary
notwithstanding, any notification pursuant to the foregoing provision will not cure or remedy the
effect of the prior untrue statement of a material fact or omission of any material fact nor shall
any such notification have the effect of amending or modifying this Agreement or any of the
Schedules hereto.



     5.11 Formation of Subsidiaries. At the time that any Loan Party forms any direct
or indirect Subsidiary or acquires any direct or indirect Domestic Subsidiary after the Closing
Date, such Loan Party shall (a) within twenty (20) days of such formation or acquisition (or such
later date as permitted by Agent in its sole discretion) cause any such new Domestic Subsidiary to
provide to Agent a joinder to this Agreement, the Guaranty and the Security Agreement, together
with such other security documents (including mortgages with respect to any Real Property owned in
fee of such new Domestic Subsidiary with a fair market value of at least $2,000,000 or, if a
mortgage on any Real Property has been or will be granted to Term Loan Agent, then without regard
to the fair market value of such Real Property) as well as appropriate financing statements (and
with respect to all property subject to a mortgage, fixture filings), all in form and substance
reasonably satisfactory to Agent (including being sufficient to grant Agent a first or, in the case
of Term Loan Priority Collateral, second priority Lien (subject to Permitted Liens) in and to the
assets of such newly formed or acquired Subsidiary), (b) within twenty (20) days of such formation
or acquisition (or such later date as permitted by Agent in its sole discretion) provide to Agent a
pledge agreement (or an addendum to the Security Agreement) and appropriate financing statements,
pledging all of the direct or beneficial ownership interest in such new Subsidiary reasonably
satisfactory to Agent and provide to Agent or, for so long as any Indebtedness under the Term Loan
Documents is outstanding, Term Loan Agent appropriate certificates and powers; provided,
that, only sixty-five (65%) percent of the total outstanding voting Equity Interests of any
first tier Subsidiary of any Loan Party that is a Foreign Subsidiary (and none of the Equity
Interests of any Subsidiary of such Foreign Subsidiary) shall be required to be pledged (which
pledge shall be governed by the laws of the jurisdiction of such Subsidiary if Term Loan Agent has
requested or received a pledge governed by such laws), and (c) within ten (10) days of such
formation or acquisition (or such later date as permitted by Agent in its sole discretion) provide
to Agent all other documentation, including one or more opinions of counsel reasonably satisfactory
to Agent, which in its opinion is appropriate with respect to the execution and delivery of the
applicable documentation referred to above (including policies of title insurance or other
documentation with respect to all Real Property owned in fee and subject to a mortgage). Any
document, agreement, or instrument executed or issued pursuant to this Section 5.11 shall be a Loan
Document.



     5.12 Further Assurances. At any time upon the reasonable request of Agent,
execute or deliver to Agent any and all financing statements, fixture filings, security agreements,
pledges, assignments, endorsements of certificates of title, mortgages, deeds of trust, opinions
of counsel, and all other documents (the “Additional Documents”) that Agent may reasonably request in form
and substance reasonably satisfactory to Agent, to create, perfect, and continue to perfect Agent’s
Liens in all of the assets of each Loan Party (whether now owned or hereafter arising or acquired,
tangible or intangible, real or personal), to create and perfect Liens in favor of Agent in any
fee-



43









 




owned Real Property acquired by any Loan Party after the Closing Date with a fair market value
in excess of $2,000,000 as of the date of the acquisition thereof by such Loan Party or, if a
mortgage on any Real Property has been or will be granted to Term Loan Agent, then without regard
to the fair market value of such Real Property, and in order to fully consummate all of the
transactions contemplated hereby and under the other Loan Documents. To the maximum extent
permitted by applicable law, each Loan Party authorizes Agent, upon the occurrence and during the
continuance of an Event of Default, to execute any such Additional Documents in the applicable Loan
Party’s name, as applicable, and authorizes Agent to file such executed Additional Documents in any
appropriate filing office. In furtherance and not in limitation of the foregoing, each Loan Party
shall take such actions as Agent may reasonably request from time to time to ensure that the
Obligations are guarantied by the Guarantors and are secured by substantially all of the assets of
each Loan Party and all of the outstanding Equity Interests of Loan Parties (other than Parent) and
Loan Parties’ first tier Subsidiaries (subject to the exceptions and limitations contained in
Section 5.11 of this Agreement and elsewhere in the Loan Documents with respect to any Foreign
Subsidiary).




     5.13 Lender Meetings. At the request of Agent or of the Required Lenders and upon
reasonable prior notice, hold an annual meeting (at a mutually agreeable location (taking into
account the travel costs associated therewith) and time or, at the option of Agent, by conference
call) with all Lenders who choose to attend such meeting at which meeting shall be reviewed the
financial results of the previous fiscal year and the financial condition of Loan Parties and their
Subsidiaries and the projections presented for the current fiscal year of Borrowers to the extent
then available (it being understood that material non-public information may be disseminated at
such meeting).



     5.14 Material Contracts. Provide Agent with, promptly, and in any event within
ten Business Days after (i) any Material Contract is terminated or amended in a manner that is
materially adverse to Parent or any of its Subsidiaries, as the case may be, or (ii) any new
Material Contract is entered into, a written statement describing such event.



     5.15 Location of Inventory and Equipment. Keep each Loan Parties’ Inventory and
Equipment (other than vehicles and Inventory and Equipment that is in-transit or out for repair)
only at the locations identified on Schedule 4.29 and their chief executive offices only at
the locations identified on Schedule 4.6(b); provided, however, that
Borrowers may amend Schedule 4.29 or Schedule 4.6(b) so long as such amendment
occurs by written notice to Agent within ten (10) days of the date on which such Inventory or
Equipment is moved to such new location or such chief executive office is relocated and so long as
such new location is within the continental United States, and so long as, at the time of such
written notification, Administrative Borrower uses its commercially reasonable efforts to provide
Agent a Collateral Access Agreement with respect thereto.



     5.16 Dissolution of Triple S EMC. By no later than July 31, 2011, (a) dissolve
Triple S EMC and transfer all of the assets (including any interest in Equity Interests) of Triple
S EMC to a Loan Party and (b) provide reasonably satisfactory evidence of the foregoing to Agent.



     5.17 Conduct of Tronox Funding. Cause Tronox Funding to (a) not engage in any
business other than, at its option, act as a special purpose vehicle in connection with the
securitization of Accounts to the extent permitted under this Agreement, (b) not create, incur,
guarantee, assume or otherwise become liable for any Indebtedness for borrowed money or (c) not



44









 




create, incur, assume, or suffer to exist any Lien with respect to any of its assets which secure
any Indebtedness for borrowed money.




     5.18 Bills of Lading and Other Documents of Title.



          (a) Cause all bills of lading or other documents of title relating to Inventory purchased by a
Borrower which are outside the United States of America and in transit to the premises of a Loan
Party or the premises of a Freight Forwarder in the United States of America (i) to be issued in a
form so as to constitute negotiable documents as such term is defined in the UCC and (ii) other
than those relating to goods being purchased pursuant to a Letter of Credit, to be issued either to
the order of Agent or such other person as Agent may from time to time designate for such purpose
as consignee or Borrower as consignee, as Agent may specify.




          (b) Cause there to be no more than three (3) originals of any bills of lading and other
documents of title relating to Inventory being purchased by a Borrower which are outside the United
States of America and in transit to the premises of a Loan Party or the premises of a Freight
Forwarder in the United States of America. As to any such bills of lading or other documents of
title, (i) two (2) of the originals of each of such bill of lading or other document of title shall
be delivered to such Freight Forwarder as Borrowers may specify and that is party to a Collateral
Access Agreement and (ii) one (1) original of each such bill of lading or other document of title
shall be delivered to Borrower or, in the case of either clause (i) or (ii), if an Event of Default
shall exist, to Agent or such other Person as Agent may direct from time to time. To the extent
that the terms of this Section have not been satisfied as to any Inventory, such Inventory shall
not constitute Eligible In-Transit Inventory.




          (c) Each Borrower and Guarantor hereby irrevocably designate and appoint 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 (i) clear Inventory
through the Bureau of Customs and Border Protection (formerly the Customs Service) or other
domestic 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 name, any necessary documents in connection therewith and (ii) endorse and
negotiate any bill of lading or other document of title with respect to such goods naming such
Borrower or Guarantor as consignee to Agent or its designee.




     5.19 Consignment Agreements. Provide Agent with, promptly, and in any event
within five Business Days after (a) any consignment agreement between a Borrower and PPG or
Sherwin-Williams is amended in any manner that is adverse to Parent or any of its Subsidiaries
in any material respect or (b) any new agreement relating to the consignment arrangements
between a Borrower and PPG or Sherwin-Williams is entered into, describing such event, together
with copies of such amendments or new agreements delivered to Agent.


6. NEGATIVE COVENANTS




45









 








     Each Loan Party covenants and agrees that, until termination of all of the Commitments and
payment in full of the Obligations, the Loan Parties will not and will not permit any of their
Subsidiaries to do any of the following:



     6.1 Indebtedness. Create, incur, assume, suffer to exist, guarantee, or otherwise
become or remain, directly or indirectly, liable with respect to any Indebtedness, except for
Permitted Indebtedness; provided, that, in no event will any Loan Party create, incur, suffer to
exist, guarantee or otherwise become or remain, directly or indirectly, liable with respect to any
Indebtedness for borrowed money owing to any of the Specified Subsidiaries unless Agent shall have
received the Intercompany Subordination Agreement which has been duly authorized, executed and
delivered by such Specified Subsidiary as a Payee thereunder.



     6.2 Liens. Create, incur, assume, or suffer to exist, directly or indirectly, any
Lien on or with respect to any of its assets, of any kind, whether now owned or hereafter acquired,
or any income or profits therefrom, except for Permitted Liens.



     6.3 Restrictions on Fundamental Changes.



          (a) Other than in order to consummate a Permitted Acquisition, enter into any merger,
consolidation, reorganization, or recapitalization, or reclassify its Equity Interests, except for
(i) any merger between Loan Parties; provided, that, a Borrower must be the
surviving entity of any such merger to which it is a party (except if a Borrower merges into a
Domestic Guarantor, such Domestic Guarantor may be the surviving entity so long as such Domestic
Guarantor becomes a Borrower contemporaneously with the completion of such merger), (ii) any merger
between a Loan Party and Subsidiaries of any Loan Party that are not Loan Parties so long as such
Loan Party is the surviving entity of any such merger, and (iii) any merger between Subsidiaries of
Parent, which Subsidiaries are not Loan Parties,




          (b) Liquidate, wind up, or dissolve itself (or suffer any liquidation or dissolution), except
for (i) the liquidation or dissolution of non-operating Subsidiaries of Parent with nominal assets
and nominal liabilities, (ii) the liquidation or dissolution of a Loan Party (other than Parent or
any Borrower) or any wholly-owned Subsidiary of any Loan Party so long as all of the assets
(including any interest in any Equity Interests) of such liquidating or dissolving Loan Party or
Subsidiary are contemporaneously transferred to a Loan Party that is not liquidating or dissolving
of, if the liquidating, winding-up or dissolving entity is not a Loan Party, then such assets may
be transferred to any Subsidiary of the Parent, or (iii) the liquidation or dissolution of a
Subsidiary of Parent that is not a Loan Party (other than any such Subsidiary the Equity Interests
of which (or any portion thereof) is subject to a Lien in favor of Agent) so long as all of the
assets of such liquidating or dissolving Subsidiary are contemporaneously transferred to a
Subsidiary of Parent that is not liquidating or dissolving, or




          (c) Suspend or go out of a substantial portion of its or their business, except as permitted
pursuant to clauses (a) or (b) above or in connection with the transactions permitted pursuant to
Section 6.4.




     6.4 Disposal of Assets. Other than Permitted Dispositions, Permitted Investments,
or transactions expressly permitted by Sections 6.3 and 6.11, convey, sell, lease, license, assign,



46









 




transfer, or otherwise dispose of (or enter into an agreement to convey, sell, lease, license,
assign, transfer, or otherwise dispose of) any of Parent’s assets or the assets of any Subsidiary
of Parent.




     6.5 Change Name. Change the name of Parent or the name of any Subsidiary of
Parent, organizational identification number, state of organization or organizational identity;
provided, however, that Parent or any of its Subsidiaries may change their names
upon at least ten (10) days prior written notice to Agent of such change.



     6.6 Nature of Business. Make any change in the nature of its or their business as
presently conducted or acquire any properties or assets that are not reasonably related to the
conduct of such business activities; provided, however, that the foregoing shall
not prevent any Parent or any Subsidiary of Parent from engaging in any business that is reasonably
related or ancillary to its or their business.



     6.7 Prepayments and Amendments.



          (a) Except in connection with Refinancing Indebtedness permitted by Section 6.1.




               (i) optionally prepay, redeem, defease, purchase, or otherwise acquire any Indebtedness of
any Loan Party or any Subsidiary of any Loan Party, other than (A) the Obligations in accordance
with this Agreement, (B) Permitted Intercompany Advances owing to a Loan Party, (C) Indebtedness of
a Subsidiary of Parent that is not a Loan Party but solely to the extent prepaid, redeemed,
defeased, purchased or acquired by a Subsidiary of Parent that is not a Loan Party and (D) the
Indebtedness permitted by clauses (c), (g), (h), (i), (j), (k), (l), (m), (p) and (x) of the
definition of Permitted Indebtedness; provided, that, both before and immediately
after giving effect to each such prepayment, redemption, defeasance, purchase or acquisition
pursuant to this clause (D), (1) no Event of Default shall have occurred and be continuing, (2) in
the case of Indebtedness permitted by clause (m) or (p) of the definition of Permitted
Indebtedness, Borrowers shall have Excess Availability of not less than $40,000,000, and (3) in the
case of Indebtedness permitted by clause (c), (g) or (x) of the definition of Permitted
Indebtedness, no Specified Availability Period shall exist,



               (ii) make any payment on account of Indebtedness that has been contractually subordinated
in right of payment to the Obligations if such payment is not permitted at such time under the
subordination terms and conditions, or



          (b) Directly or indirectly, amend, modify, or change any of the terms or provisions of




               (i) any agreement, instrument, document, indenture, or other writing evidencing or
concerning Permitted Indebtedness other than (A) the Obligations in accordance
with this Agreement, (B) Permitted Intercompany Advances, (C) Indebtedness permitted under
clauses (c), (g), (h), (i), (j), (k), (l) and (x) of the definition of Permitted Indebtedness and
(D) Indebtedness permitted under clause (p) of the definition of Permitted Indebtedness except and
to the extent that such amendment, modification or change pursuant to this clause (D) would violate
the terms of the Intercreditor Agreement,



               (ii) Reserved;



47









 





               (iii) the Governing Documents of any Loan Party or any of its Domestic Subsidiaries or
first-tier Foreign Subsidiaries if the effect thereof, either individually or in the aggregate,
could reasonably be expected to be materially adverse to the interests of the Lenders.



     6.8 Change of Control. Cause, permit, or suffer, directly or indirectly, any
Change of Control.



     6.9 Restricted Junior Payments. Make any Restricted Junior Payment;
provided, however, that, so long as it is not in contravention of law,



          (a) any direct or indirect Subsidiary of Parent may declare and pay dividends or other
distributions to its parent; provided, that, no Loan Party may pay dividends to a
Person that is not a Loan Party,




          (b) Parent and its Subsidiaries may repurchase Equity Interests held by employees pursuant to
any employee stock ownership plan thereof upon the termination, retirement or death of any such
employee in accordance with the provisions of such plan; provided, that, as to any
such repurchase, each of the following conditions is satisfied: (i) as of the date of the payment
for such repurchase and after giving effect thereto, no Event of Default shall exist or have
occurred and be continuing, and (ii) the aggregate amount of all payments for such repurchases in
any calendar year shall not exceed $500,000;




          (c) [Reserved];




          (d) Borrowers may make Restricted Junior Payments to Parent, to the extent necessary to permit
Parent (i) to pay general administrative costs and expenses, legal and accounting fees and other
general corporate and overhead expenses incurred by Parent in the ordinary course of business, (ii)
pay franchise taxes and other taxes or fees required in each case to maintain its corporate
existence, (iii) pay taxes which are due and payable by Parent as part of a consolidated group or
due to ownership of any interests in Subsidiaries that are not treated as corporations for
applicable tax purposes, in each case, to the extent such taxes are attributable to the Loan
Parties, (iv) pay auditing fees and expenses, (iv) pay directors fees, expenses and indemnities
owing to directors of Parent and (v) pay fees and expenses incurred in connection with a public
offering;




          (e) any Subsidiary of Parent may make Restricted Junior Payments to any Loan Party; and




          (f) any Subsidiary may make regularly scheduled payments of interest in respect of any
Permitted Seller Notes in accordance with the terms of, and only to the extent permitted by, the
subordination agreement between Agent and the holder of such Permitted Seller Note.




     6.10 Accounting Methods. Modify or change its fiscal year or its method of
accounting (other than as may be required to conform to GAAP or the then-applicable requirements).



     6.11 Investments; Controlled Investments. Except for Permitted Investments,
directly or indirectly, make or acquire any Investment or incur any liabilities (including
contingent obligations) for or in connection with any Investment.



48









 





     6.12 Transactions with Affiliates. Directly or indirectly enter into or permit to
exist any transaction with any Affiliate of Parent or any Subsidiary of Parent except for:



          (a) transactions (other than the payment of management, consulting, monitoring or advisory
fees) between any Loan Party, on the one hand, and any Affiliate of Parent or a Subsidiary of
Parent, on the other hand, so long as such transactions (i) are fully disclosed to Agent prior to
the consummation thereof, if they involve one or more payments by any Loan Party in excess of
$1,000,000 for any single transaction or series of related transactions, and (ii) are no less
favorable, taken as a whole, to such Loan Party than would be obtained in an arm’s length
transaction with a non-Affiliate,




          (b) so long as it has been approved by Parent’s board of directors or the board of directors
of its applicable Subsidiary (or comparable governing body) in accordance with applicable law, any
indemnity provided for the benefit of directors (or comparable managers) of Parent or its
applicable Subsidiary,




          (c) reasonable and customary fees paid to members of the board of directors (or similar
governing body) of Parent and its Subsidiaries;




          (d) the payment of reasonable compensation, severance, or employee benefit arrangements to
employees, officers, and outside directors of Parent’s and its Subsidiaries in the ordinary course
of business,




          (e) transactions permitted by Section 6.3, Section 6.9 or Section 6.11, or any Permitted
Intercompany Advance,




          (f) transactions between or among US Loan Parties,




          (g) transactions between or among non-Loan Party Subsidiaries,




          (h) the Kwinana Investment;




          (i) transactions described on Schedule 6.12; and,




          (j) the Permitted Transaction.




     6.13 Use of Proceeds. Use the proceeds of any loan made hereunder for any purpose
other than (a) on the Closing Date, (i) to repay a portion of the outstanding principal amount of
the New Term Loan (as defined in the Term Loan Agreement as in effect on the date hereof) and
accrued and unpaid interest thereon, (ii) to fund payments in order to substantially consummate the
Chapter 11 Plan, and (iii) to pay transactional fees, costs, and expenses incurred in connection
with this Agreement, the other Loan Documents, and the transactions contemplated hereby and thereby
(including the fees and expenses associated with the Chapter 11 Plan), and (b) thereafter,
consistent with the terms and conditions hereof, for its lawful and permitted purposes, including
but not limited to the financing of ongoing working capital, capital expenditures and general
corporate needs of the Borrowers, and the making of loans to other Subsidiaries and Affiliates in
accordance with the terms of this Agreement. No Loan Party shall use any of the proceeds of any
Ex-Im Advance, directly or indirectly, for any purpose not permitted by Section 2.01 of the
Borrower Agreement.




49












 





     6.14 Limitation on Issuance of Equity Interests. Except for the issuance or sale
of common stock or Permitted Preferred Equity Interests, issue or sell or enter into any agreement
or arrangement for the issuance and sale of any of its Equity Interests.



     6.15 Sales and Lease Backs. Directly or indirectly become or remain liable as lessee
or as a guarantor or other surety with respect to any lease of any property (whether real, personal
or mixed), whether now owned or hereafter acquired, which such Loan Party (a) has sold or
transferred or is to sell or to transfer to any other Person (other than Parent or any of its
Subsidiaries), or (b) intends to use for substantially the same purpose as any other property which
has been or is to be sold or transferred by such Loan Party to any Person (other than Parent or any
of its Subsidiaries) in connection with such lease, other than the Henderson Sale-Leaseback, the
Verve Sale-Leaseback and any similar transaction relating to the Savannah, Georgia facility.



     6.16 Certain Deposit Accounts. Deposit or otherwise remit cash or other amounts into
the Settlement Escrow Account, the Working Capital Escrow Account or the Reinvestment Accounts
(each as defined in the Term Loan Agreement as in effect on the date hereof), except to the extent
expressly required by the Term Loan Agreement as in effect on the date hereof.


7. FINANCIAL COVENANTS. 




     Each Loan Party covenants and agrees that, until termination of all of the Commitments and
payment in full of the Obligations (other than unasserted indemnification obligations):



          (a) Minimum Fixed Charge Coverage Ratio. During any Compliance Period, the Fixed Charge
Coverage Ratio, for the most recently ended period of twelve consecutive months for which Agent has
received financial statements of Parent and its Subsidiaries (each a “Test Period”), commencing
with the period of twelve consecutive months ending on November 30, 2010, shall not be less than
1.0:1.0; provided, that, if Loan Parties are required to maintain a Fixed Charge
Coverage Ratio for any Test Period of not less than 1.0:1.0 pursuant to this Section 7, then either
(i) the Consolidated Adjusted EBITDAR of Borrowers for such Test Period shall not be less than the
Specified EBITDAR Percentage of the Consolidated Adjusted EBITDAR of Parent and its Subsidiaries
for such Test Period or (ii) the Consolidated Adjusted EBITDAR of Borrowers during such Test Period
shall not be less than the Specified EBITDAR Threshold for such Test Period.



          (b) [Reserved].



          (c) Certain Calculations. With respect to any period during which a Permitted Acquisition or
a Permitted Disposition has occurred (each a “Subject Transaction”), for purposes of determining
compliance with the financial covenants set forth in Section 7(a), Consolidated Adjusted EBITDAR
and the components of Consolidated Interest Expense and Fixed Charges shall be calculated with
respect to such period on a pro forma basis (including pro forma adjustments arising out of events
which are directly attributable to a specific transaction, are factually supportable and are
expected to have a continuing impact, in each case determined on a basis consistent with Article 11
of Regulation S-X promulgated under the Securities Act and as interpreted by the staff of the
Securities and Exchange Commission, which would include cost savings resulting from head count
reduction, closure of facilities and similar restructuring charges, which pro forma adjustments
shall be certified by the chief financial officer or chief executive officer of Parent and shall be
reasonably



50









 




satisfactory to Agent) using the historical financial statements of any business so acquired
or to be acquired or sold or to be sold and the consolidated financial statements of Parent and its
Subsidiaries which shall be reformulated as if such Subject Transaction, and any Indebtedness
incurred or repaid in connection therewith, had been consummated or incurred or repaid at the
beginning of such period (and assuming that such Indebtedness bears interest during any portion of
the applicable measurement period prior to the relevant acquisition at the weighted average of the
interest rates applicable to outstanding Base Rate Loans incurred during such period).



8. EVENTS OF DEFAULT.




     Any one or more of the following events shall constitute an event of default (each, an “Event
of Default”) under this Agreement:



     8.1 If any Loan Party fails to pay when due and payable (whether at maturity, by acceleration
or otherwise) (a) all or any portion of the Obligations consisting of interest, fees, or charges
due the Lender Group (including the reimbursement of Lender Group Expenses) or other amounts (other
than any portion thereof constituting principal) constituting Obligations and such failure
continues for a period of three (3) Business Days, or (b) all or any portion of the principal of
the Obligations;




8.2 If any Loan Party or any of its Subsidiaries:



          (a) fails to perform or observe any covenant or other agreement contained in any of (i)
Sections 5.1 (other than with respect to clauses (h), (i), (j), (l), (m), (n) and (o) of Schedule
5.1), 5.2 (other than with respect to clauses (p), (q) and (s) of Schedule 5.2), 5.3 (solely if a
Loan Party is not in good standing in its jurisdiction of organization), 5.6, 5.7 (solely if a Loan
Party refuses to allow Agent or its representatives or agents to visit a Loan Party’s properties,
inspect its assets or books or records, examine and make copies of its books and records, or
discuss a Loan Party’s affairs, finances, and accounts with officers and employees of Loan
Parties), 5.11 or 5.15 of this Agreement, (ii) Sections 6.1 through 6.15 of this Agreement, (iii)
Section 7 of this Agreement, or (iv) Section 6 of the Security Agreement;



          (b) fails to perform or observe any covenant or other agreement contained in (i) Section 5.10
of this Agreement and such failure continues for a period of ten (10) days after the earlier of (A)
the date on which such failure first became known to any officer of any Loan Party or (B) the date
on which written notice thereof is given to Administrative Borrower by Agent or (ii) any of
Sections 5.3 (other than if a Loan Party is not in good standing in its jurisdiction of
organization), 5.4, 5.5, 5.8, 5.12 and 5.13 of this Agreement and such failure continues for a
period of thirty (30) days after the earlier of (A) the date on which such failure shall first
become known to any officer of any Loan Party or (B) the date on which written notice thereof is
given to a Loan Party by Agent; or



          (c) fails to perform or observe any covenant or other agreement contained in this Agreement,
or in any of the other Loan Documents, in each case, other than any such covenant or agreement that
is the subject of another provision of this Section 8 (in which event such other provision of this
Section 8 shall govern), and such failure continues for a period of thirty (30) days after the
earlier of (i) the date on which such failure shall first become known to any officer of any Loan
Party or (ii) the date on which written notice thereof is given to a Loan Party by Agent;



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     8.3 If one or more judgments, orders, or awards for the payment of money involving an
aggregate amount of $2,500,000, or more (except to the extent covered (other than to the extent of
customary deductibles) by insurance pursuant to which the insurer has not denied coverage) is
entered or filed against any Loan Party or any of its Subsidiaries, or with respect to any of their
respective assets, and either (a) there is a period of thirty (30) consecutive days at any time
after the entry of any such judgment, order, or award during which (i) the same is not discharged,
satisfied, vacated, or bonded pending appeal, or (ii) a stay of enforcement thereof is not in
effect, or (b) enforcement proceedings are commenced upon such judgment, order, or award which are
not stayed;



     8.4 If an Insolvency Proceeding is commenced by a Loan Party or any of its Subsidiaries,
except for an Insolvency Proceeding commenced by or with respect to a Subsidiary that is not a Loan
Party to effectuate a liquidation or dissolution of such Subsidiary which is permitted by Section
6.3(b) hereof;



     8.5 (a) If an Insolvency Proceeding is commenced against a Loan Party or any of its
Subsidiaries and any of the following events occur: (a) such Loan Party or such Subsidiary
consents to the institution of such Insolvency Proceeding against it, (b) the petition commencing
the Insolvency Proceeding is not timely controverted, (c) the petition commencing the Insolvency
Proceeding is not dismissed within sixty (60) calendar days of the date of the filing thereof, (d)
an interim trustee is appointed to take possession of all or any substantial portion of the
properties or assets of, or to operate all or any substantial portion of the business of, such Loan
Party or its Subsidiary, or (e) an order for relief shall have been issued or entered therein;



     8.6 [Reserved];



     8.7 (a) If there is a default in one or more agreements to which a Loan Party is a party with
one or more third Persons relative to a Loan Party’s Indebtedness involving an aggregate amount of
$2,500,000 or more, and such default (i) occurs at the final maturity of the obligations
thereunder, or (ii) results in a right by such third Person, irrespective of whether exercised, to
accelerate the maturity of such Loan Party’s obligations thereunder, or (b) if there is a default
in one or more agreements to which a Subsidiary which is not a Loan Party is a party with one or
more third Persons relative to the Indebtedness of a Subsidiary which is not a Loan Party involving
an aggregate amount of $2,500,000 or more and such default (i) occurs at the final maturity of the
obligations thereunder or (ii) such Indebtedness has been accelerated or otherwise declared to be
due and payable;



     8.8 If any warranty, representation, certificate, statement, or Record made herein or in any
other Loan Document or delivered in writing by a Loan Party to Agent or any Lender in connection
with this Agreement or any other Loan Document proves to be untrue in any material respect (except,
that, such materiality qualifier shall not be applicable to any representations and warranties that
already are qualified or modified by materiality in the text thereof) as of the date of issuance or
making or deemed making thereof;



     8.9 If the obligation of any Guarantor under the Guaranty is limited in any material respect
or terminated by operation of law or by such Guarantor (other than in accordance with the terms of
this Agreement);



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     8.10 If the Security Agreement or any other Loan Document that purports to create a Lien,
shall, for any reason, fail or cease to create a valid and perfected and (except to the extent of
Permitted Liens for which priority is accorded by operation of law or other Permitted Liens which
are permitted to be senior to Agent’s Lien pursuant to this Agreement) first priority Lien on the
Collateral covered thereby, except (a) as a result of a disposition of the applicable Collateral in
a transaction permitted under this Agreement, (b) with respect to Collateral the aggregate value of
which, for all such Collateral, does not exceed at any time, $2,500,000, or (c) as the result of an
action or failure to act on the part of Agent;



     8.11 The validity or enforceability of any Loan Document shall at any time for any reason
(other than solely as the result of an action or failure to act on the part of Agent) be declared
to be null and void, or a proceeding shall be commenced by Parent or its Subsidiaries, or by any
Governmental Authority having jurisdiction over Parent or its Subsidiaries, seeking to establish
the invalidity or unenforceability thereof, or any Loan Party shall deny that any Loan Party has
any liability or obligation purported to be created under any Loan Document;



     8.12 If there is a default by any Loan Party or any of its Subsidiaries under the Chapter 11
Plan or the Confirmation Order which default continues for more than the applicable cure period, if
any, with respect thereto; or



     8.13 If any Loan Party of any of its Subsidiaries fails to observe or perform in any material
respect any of the terms or conditions of any order or stipulation entered by or with the
Bankruptcy Court in the Chapter 11 Case applicable to it.


9. RIGHTS AND REMEDIES.




     9.1 Rights and Remedies. Upon the occurrence and during the continuation of an Event
of Default, Agent may, and, at the instruction of the Required Lenders, shall (in each case under
clauses (a) or (b) by written notice to Administrative Borrower), in addition to any other rights
or remedies provided for hereunder or under any other Loan Document or by applicable law, do any
one or more of the following:



          (a) Declare all or any portion of the Obligations (other than the Bank Product Obligations),
whether evidenced by this Agreement or by any of the other Loan Documents immediately due and
payable, whereupon the same shall become and be immediately due and payable and Borrowers shall be
obligated to repay all of such Obligations in full, without presentment, demand, protest, or
further notice or other requirements of any kind, all of which are hereby expressly waived by
Borrowers;



          (b) Declare all or any portion of the Commitments terminated, whereupon the Commitments so
terminated shall immediately be terminated together with the corresponding amount of (i) any
obligation of any Lender hereunder to make Advances, (ii) the obligation of the Swing Line Lender
to make Swing Line Loans, and (iii) the obligation of the Issuing Lender to issue Letters of
Credit; and



          (c) exercise all other rights and remedies available to Agent or the Lenders under the Loan
Documents or applicable law.



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The foregoing to the contrary notwithstanding, upon the occurrence of any Event of Default
described in Section 8.4 or Section 8.5, in addition to the remedies set forth above, without any
notice to Borrowers or any other Person or any act by the Lender Group, the Commitments shall
automatically terminate and the Obligations (other than the Bank Product Obligations), inclusive of
all accrued and unpaid interest thereon and all fees and all other amounts owing under this
Agreement or under any of the other Loan Documents, shall automatically and immediately become due
and payable and Borrowers shall be obligated to repay all of such Obligations in full, without
presentment, demand, protest, or notice of any kind, all of which are expressly waived by
Borrowers.




     9.2 Remedies Cumulative. The rights and remedies of the Lender Group under this
Agreement, the other Loan Documents, and all other agreements shall be cumulative. The Lender
Group shall have all other rights and remedies not inconsistent herewith as provided under the UCC,
by law, or in equity. No exercise by the Lender Group of one right or remedy shall be deemed an
election, and no waiver by the Lender Group of any Event of Default shall be deemed a continuing
waiver. No delay by the Lender Group shall constitute a waiver, election, or acquiescence by it.


10. WAIVERS; INDEMNIFICATION.




     10.1 Demand; Protest; etc. Each Loan Party waives demand, protest, notice of protest,
notice of default or dishonor, notice of payment and nonpayment, nonpayment at maturity, release,
compromise, settlement, extension, or renewal of documents, instruments, chattel paper, and
guarantees at any time held by the Lender Group on which any Loan Party may in any way be liable.



     10.2 The Lender Group’s Liability for Collateral. Each Loan Party hereby agrees that:
(a) so long as Agent complies with its obligations, if any, under the UCC, the Lender Group shall
not in any way or manner be liable or responsible for: (i) the safekeeping of the Collateral, (ii)
any loss or damage thereto occurring or arising in any manner or fashion from any cause, (iii) any
diminution in the value thereof, or (iv) any act or default of any carrier, warehouseman, bailee,
forwarding agency, or other Person, and (b) all risk of loss, damage, or destruction of the
Collateral shall be borne by Loan Parties.



     10.3 Indemnification. Each Loan Party shall pay and jointly and severally indemnify,
defend, and hold the Agent-Related Persons, the Lender-Related Persons, and each Participant (each,
an “Indemnified Person”) harmless (to the fullest extent permitted by law) from and against any and
all claims, demands, suits, actions, investigations, proceedings, liabilities, fines, costs,
penalties, and damages, and all reasonable and documented fees and disbursements of attorneys,
experts, or consultants and all other costs and expenses actually incurred in connection therewith
or in connection with the enforcement of this indemnification (as and when they are incurred and
irrespective of whether suit is brought), at any time asserted against, imposed upon, or incurred
by any of them (a) in connection with or as a result of or related to the execution and delivery
(provided, that, no Loan Party shall be liable for costs and expenses (including
attorneys fees) of any Lender (other than WFCF) incurred in advising, structuring, drafting,
reviewing, administering or syndicating the Loan Documents), enforcement, performance, or
administration (including any restructuring or workout with respect hereto) of this Agreement, any
of the other Loan Documents, or the transactions contemplated hereby or thereby or the monitoring
of Parent and its Subsidiaries’ compliance with the terms of the Loan Documents (provided,
however, that the indemnification in this clause (a) shall not extend to (i) disputes
solely between or among the Lenders or (ii) disputes



54









 




solely between or among the Lenders and their respective Affiliates; it being understood and
agreed that the indemnification in this clause (a) shall extend to disputes between and among Agent
on the one hand, and one or more Lenders, or one or more of their Affiliates, on the other hand in
connection with or as a result of or related to any of the Loan Documents), (b) with respect to
any investigation, litigation, or proceeding related to this Agreement, any other Loan Document, or
the use of the proceeds of the credit provided hereunder (irrespective of whether any Indemnified
Person is a party thereto), or any act, omission, event, or circumstance in any manner related
thereto, and (c) in connection with or arising out of any presence or release of Hazardous
Materials at, on, under, to or from any assets or properties owned, leased or operated by Parent or
a Subsidiary of Parent or any Environmental Actions, Environmental Liabilities or Remedial Actions
related in any way to any such assets or properties of Parent or a Subsidiary of Parent (each and
all of the foregoing, the “Indemnified Liabilities”). The foregoing to the contrary
notwithstanding, no Loan Party shall have any obligation to any Indemnified Person under this
Section 10.3 with respect to any Indemnified Liability resulting from the gross negligence or
willful misconduct of any Indemnified Person or its officers, directors, employees, attorneys, or
agents as determined by a court of competent jurisdiction pursuant to a final, non-appealable
judgment. This provision shall survive the termination of this Agreement and the repayment of the
Obligations. If any Indemnified Person makes any payment to any other Indemnified Person with
respect to an Indemnified Liability as to which a Loan Party was required to indemnify the
Indemnified Person receiving such payment, the Indemnified Person making such payment is entitled
to be indemnified and reimbursed by such Loan Party with respect thereto.



11. NOTICES.




     Unless otherwise provided in this Agreement, all notices or demands relating to this Agreement
or any other Loan Document shall be in writing and (except for financial statements and other
informational documents which may be sent by first-class mail, postage prepaid) shall be personally
delivered or sent by registered or certified mail (postage prepaid, return receipt requested),
overnight courier, electronic mail (at such email addresses as a party may designate in accordance
herewith), or telefacsimile. In the case of notices or demands to any Borrower or Agent, as the
case may be, they shall be sent to the respective address set forth below:



	 	 	 	 	 

	 

	 	If to a Loan Party:
	 	Tronox Incorporated

One Leadership Square, Suite 300

Oklahoma City, Oklahoma 73102-7109

Attn: General Counsel

Fax No. 405-302-4706
	 
	 	 	 	 
	 

	 	with copies to:
	 	Kirkland & Ellis LLP

601 Lexington Avenue

New York, New York 10022

Attn: Leonard Klingbaum, Esq. 

Fax No.: 212-446-6460
	 
	 	 	 	 
	 

	 	If to Agent:
	 	Wells Fargo Capital Finance, LLC

150 South Wacker Drive

Chicago, Illinois 60606






55









 






	 	 	 	 	 

	 

	 	 	 	Attn: Portfolio Manager

Fax No.: (312) 332-0424
	 
	 	 	 	 
	 

	 	with copies to:
	 	Otterbourg, Steindler, Houston & Rosen, P.C.

230 Park Avenue

New York, New York 10169

Attn: Michael Barocas, Esq.

Fax No.: (212) 682-6104






     Any party hereto may change the address at which they are to receive notices hereunder, by
notice in writing in the foregoing manner given to the other party. All notices or demands sent in
accordance with this Section 11, shall be deemed received on the earlier of the date of actual
receipt or three (3) Business Days after the deposit thereof in the mail; provided,
that, (a) notices sent by overnight courier service shall be deemed to have been given
when received, (b) notices by facsimile shall be deemed to have been given when sent
(except, that, if not given during normal business hours for the recipient, shall
be deemed to have been given at the opening of business on the next Business Day for the recipient)
and (c) notices by electronic mail shall be deemed received upon the sender’s receipt of an
acknowledgment from the intended recipient (such as by the “return receipt requested” function, as
available, return email or other written acknowledgment).


12. CHOICE OF LAW AND VENUE; JURY TRIAL WAIVER.




          (a) THE VALIDITY OF THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS (UNLESS EXPRESSLY PROVIDED TO
THE CONTRARY IN ANOTHER LOAN DOCUMENT IN RESPECT OF SUCH OTHER LOAN DOCUMENT), THE CONSTRUCTION,
INTERPRETATION, AND ENFORCEMENT HEREOF AND THEREOF, AND THE RIGHTS OF THE PARTIES HERETO AND
THERETO WITH RESPECT TO ALL MATTERS ARISING HEREUNDER OR THEREUNDER OR RELATED HERETO OR THERETO
SHALL BE DETERMINED UNDER, GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
NEW YORK.



          (b) THE PARTIES AGREE THAT ALL ACTIONS OR PROCEEDINGS ARISING IN CONNECTION WITH THIS
AGREEMENT AND THE OTHER LOAN DOCUMENTS SHALL BE TRIED AND LITIGATED ONLY IN THE STATE AND, TO THE
EXTENT PERMITTED BY APPLICABLE LAW, FEDERAL COURTS LOCATED IN THE COUNTY OF NEW YORK STATE OF NEW
YORK; PROVIDED, HOWEVER, THAT ANY SUIT SEEKING ENFORCEMENT AGAINST ANY COLLATERAL
OR OTHER PROPERTY MAY BE BROUGHT, AT AGENT’S OPTION, IN THE COURTS OF ANY JURISDICTION WHERE AGENT
ELECTS TO BRING SUCH ACTION OR WHERE SUCH COLLATERAL OR OTHER PROPERTY MAY BE FOUND. EACH BORROWER
AND EACH MEMBER OF THE LENDER GROUP WAIVE, TO THE EXTENT PERMITTED UNDER APPLICABLE LAW, ANY RIGHT
EACH MAY HAVE TO ASSERT THE DOCTRINE OF FORUM NON CONVENIENS OR TO OBJECT TO VENUE TO THE EXTENT
ANY PROCEEDING IS BROUGHT IN ACCORDANCE WITH THIS SECTION 12(b).



          (c) TO THE MAXIMUM EXTENT PERMITTED BY APPLICABLE LAW, EACH LOAN PARTY AND EACH MEMBER OF THE
LENDER GROUP HEREBY WAIVE THEIR



56









 




RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF
ANY OF THE LOAN DOCUMENTS OR ANY OF THE TRANSACTIONS CONTEMPLATED THEREIN, INCLUDING CONTRACT
CLAIMS, TORT CLAIMS, BREACH OF DUTY CLAIMS, AND ALL OTHER COMMON LAW OR STATUTORY CLAIMS. EACH
LOAN PARTY AND EACH MEMBER OF THE LENDER GROUP REPRESENT THAT EACH HAS REVIEWED THIS WAIVER AND
EACH KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS FOLLOWING CONSULTATION WITH LEGAL
COUNSEL. IN THE EVENT OF LITIGATION, A COPY OF THIS AGREEMENT MAY BE FILED AS A WRITTEN CONSENT TO
A TRIAL BY THE COURT.



13. ASSIGNMENTS AND PARTICIPATIONS; SUCCESSORS.




     13.1 Assignments and Participations.



          (a) With the prior written consent of Administrative Borrower, which consent of Administrative
Borrower shall not be unreasonably withheld, delayed or conditioned, and shall not be required (i)
if an Event of Default has occurred and is continuing, (ii) in connection with any merger or
consolidation of a Lender, or (iii) in connection with an assignment to a Person that is a Lender
or an Affiliate (other than individuals) of a Lender and with the prior written consent of Agent,
which consent of Agent shall not be unreasonably withheld, delayed or conditioned, and shall not be
required in connection with an assignment to a Person that is a Lender or an Affiliate (other than
individuals) of a Lender, any Lender may assign and delegate to one or more assignees so long as
such prospective assignee is an Eligible Transferee (each, an “Assignee”; provided,
however, that no Loan Party or Affiliate of a Loan Party shall be permitted to become an
Assignee) all or any portion of the Obligations, the Commitments and the other rights and
obligations of such Lender hereunder and under the other Loan Documents, in a minimum amount
(unless waived by Agent) of $5,000,000 (except such minimum amount shall not apply to (A) an
assignment or delegation by any Lender to any other Lender or an Affiliate of any Lender or (B) a
group of new Lenders, each of which is an Affiliate of each other or a Related Fund of such new
Lender to the extent that the aggregate amount to be assigned to all such new Lenders is at least
$5,000,000); provided, however, that Loan Parties and Agent may continue to deal
solely and directly with such Lender in connection with the interest so assigned to an Assignee
until (1) written notice of such assignment, together with payment instructions, addresses, and
related information with respect to the Assignee, have been given to Administrative Borrower and
Agent by such Lender and the Assignee, (2) such Lender and its Assignee have delivered to
Administrative Borrower and Agent an Assignment and Acceptance and Agent has notified the assigning
Lender of its receipt thereof in accordance with Section 13.1(b), and (3) unless waived by Agent,
the assigning Lender or Assignee has paid to Agent for Agent’s separate account a processing fee in
the amount of $3,500.



          (b) From and after the date that Agent notifies the assigning Lender (with a copy to
Administrative Borrower) that it has received an executed Assignment and Acceptance and, if
applicable, payment of the required processing fee, (i) the Assignee thereunder shall be a party
hereto and, to the extent that rights and obligations hereunder have been assigned to it pursuant
to such Assignment and Acceptance, shall be a “Lender” and shall have the rights and obligations of
a Lender under the Loan Documents, and (ii) the assigning Lender shall, to the extent that rights
and obligations hereunder and under the other Loan Documents have been assigned by it pursuant to



57









 







such Assignment and Acceptance, relinquish its rights (except with respect to Section 10.3)
and be released from any future obligations under this Agreement (and in the case of an Assignment
and Acceptance covering all or the remaining portion of an assigning Lender’s rights and
obligations under this Agreement and the other Loan Documents, such Lender shall cease to be a
party hereto and thereto); provided, however, that nothing contained herein shall
release any assigning Lender from obligations that survive the termination of this Agreement,
including such assigning Lender’s obligations under Section 15 and Section 17.9(a).



          (c) By executing and delivering an Assignment and Acceptance, the assigning Lender thereunder
and the 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, such 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 the execution,
legality, validity, enforceability, genuineness, sufficiency or value of this Agreement or any
other Loan Document furnished pursuant hereto, (ii) such assigning Lender makes no representation
or warranty and assumes no responsibility with respect to the financial condition of Loan Parties
or the performance or observance by Loan Parties of any of their obligations under this Agreement
or any other Loan Document furnished pursuant hereto, (iii) such Assignee confirms that it has
received a copy of this Agreement, together with such other documents and information as 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 Agent, such assigning
Lender or any other Lender, and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in taking or not taking action
under this Agreement, (v) such Assignee appoints and authorizes Agent to take such actions and to
exercise such powers under this Agreement and the other Loan Documents 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 all of the obligations which by the terms of
this Agreement are required to be performed by it as a Lender.



          (d) Immediately upon Agent’s receipt of the required processing fee, if applicable, and
delivery of notice to the assigning Lender pursuant to Section 13.1(b), this Agreement shall be
deemed to be amended to the extent, but only to the extent, necessary to reflect the addition of
the Assignee and the resulting adjustment of the Commitments arising therefrom. The Commitment
allocated to each Assignee shall reduce such Commitments of the assigning Lender pro tanto.



          (e) Any Lender may at any time sell to one or more commercial banks, financial institutions,
or other Persons (a “Participant”) participating interests in all or any portion of its
Obligations, its Commitment, and the other rights and interests of that Lender (the “Originating
Lender”) hereunder and under the other Loan Documents; provided, however, that (i)
the Originating Lender shall remain a “Lender” for all purposes of this Agreement and the other
Loan Documents and the Participant receiving the participating interest in the Obligations, the
Commitments, and the other rights and interests of the Originating Lender hereunder shall not
constitute a “Lender” hereunder or under the other Loan Documents and the Originating Lender’s
obligations under this Agreement shall remain unchanged, (ii) the Originating Lender shall remain
solely responsible for the performance of such obligations, (iii) Loan Parties, Agent, and the
Lenders shall continue to deal solely and directly with the Originating Lender in connection with
the Originating Lender’s rights and obligations under this Agreement and the other Loan Documents,
(iv) no Lender shall transfer



58









 







or grant any participating interest under which the Participant has the right to approve any
amendment to, or any consent or waiver with respect to, this Agreement or any other Loan Document,
except to the extent such amendment to, or consent or waiver with respect to this Agreement or of
any other Loan Document would (A) extend the final maturity date of the Obligations hereunder in
which such Participant is participating, (B) reduce the interest rate applicable to the Obligations
hereunder in which such Participant is participating, (C) release all or substantially all of the
Collateral or guaranties (except to the extent expressly provided herein or in any of the Loan
Documents) supporting the Obligations hereunder in which such Participant is participating, (D)
postpone the payment of, or reduce the amount of, the interest or fees payable to such Participant
through such Lender (other than a waiver of default interest), or (E) change the amount or due
dates of scheduled principal repayments or prepayments or premiums, and (v) all amounts payable by
Borrowers hereunder shall be determined as if such Lender had not sold such participation;
except, that, if amounts outstanding under this Agreement are due and unpaid, or
shall have been declared or shall have become due and payable upon the occurrence of an Event of
Default, each Participant shall be deemed to have the right of set off in respect of its
participating interest in amounts owing under this Agreement to the same extent as if the amount of
its participating interest were owing directly to it as a Lender under this Agreement. The rights
of any Participant only shall be derivative through the Originating Lender with whom such
Participant participates and no Participant shall have any rights under this Agreement or the other
Loan Documents or any direct rights as to the other Lenders, Agent, Borrowers, the Collections of
Parent or the Subsidiaries of Parent, the Collateral, or otherwise in respect of the Obligations.
No Participant shall have the right to participate directly in the making of decisions by the
Lenders among themselves.



          (f) In connection with any such assignment or participation or proposed assignment or
participation or any grant of a security interest in, or pledge of, its rights under and interest
in this Agreement, a Lender may, subject to the provisions of Section 17.9, disclose all documents
and information which it now or hereafter may have relating to Parent and its Subsidiaries and
their respective businesses.



          (g) Any other provision in this Agreement notwithstanding, any Lender may at any time create a
security interest in, or pledge, all or any portion of its rights under and interest in this
Agreement in favor of any Federal Reserve Bank in accordance with Regulation A of the Federal
Reserve Bank or U.S. Treasury Regulation 31 CFR §203.24, and such Federal Reserve Bank may enforce
such pledge or security interest in any manner permitted under applicable law.



          (h) Agent (as a non-fiduciary agent on behalf of each Borrower) shall maintain, or cause to be
maintained, a register (the “Register”) on which it enters, in book entry form, the name and
address of each Lender as the registered owner of the Advances (and the principal amount thereof
and stated interest thereon) held by such Lender (each, a “Registered Loan”). A Registered Loan
(and the registered note, if any, evidencing the same) may be assigned or sold in whole or in part
only by registration of such assignment or sale on the Register (and each registered note shall
expressly so provide) and any assignment or sale of all or part of such Registered Loan (and the
registered note, if any, evidencing the same) may be effected only by registration of such
assignment or sale on the Register, together with the surrender of the registered note, if any,
evidencing the same duly endorsed by (or accompanied by a written instrument of assignment or sale
duly executed by) the holder of such registered note, whereupon, at the request of the designated
assignee(s) or



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transferee(s), one or more new registered notes in the same aggregate principal amount shall
be issued to the designated assignee(s) or transferee(s). Prior to the registration of assignment
or sale of any Registered Loan (and the registered note, if any evidencing the same), Borrowers
shall treat the Person in whose name such Registered Loan (and the registered note, if any,
evidencing the same) is registered as the owner thereof for the purpose of receiving all payments
thereon and for all other purposes, notwithstanding notice to the contrary. In the case of any
assignment by a Lender of all or any portion of its Advances to an Affiliate of such Lender or a
Related Fund of such Lender, and which assignment is not recorded in the Register, the assigning
Lender, on behalf of Borrowers, shall maintain a register comparable to the Register.
Notwithstanding anything to the contrary contained in this Agreement, the Advances are registered
obligations and the right, title and interest of the Lenders in and to such Advances shall be
transferable only in accordance with the terms hereof. This Section 13.1(h) shall be construed so
that the Advances are at all times maintained in “registered form” within the meaning of Sections
163(f), 871(h)(2), and 881(c)(2) of the IRC.



          (i) In the event that a Lender sells participations in the Registered Loan, such Lender, as a
non-fiduciary agent on behalf of Borrowers, shall maintain (or cause to be maintained) a register
meeting the requirements of 26 CFR §5f.103-1(c) on which it records, in book-entry form, the name
of all participants in the Registered Loans held by it (and the principal amount (and stated
interest thereon) of the portion of such Registered Loans that is subject to such participations)
(the “Participant Register”). A Registered Loan (and the Registered Note, if any, evidencing the
same) may be participated in whole or in part only by registration of such participation on the
Participant Register (and each registered note shall expressly so provide). Any participation of
such Registered Loan (and the registered note, if any, evidencing the same) may be effected only by
the registration of such participation on the Participant Register.



          (j) Agent shall make a copy of the Register (and each Lender shall make a copy of its
Participant Register in the extent it has one) available for review by Administrative Borrower from
time to time as Administrative Borrower may reasonably request.



     13.2 Successors. This Agreement shall bind and inure to the benefit of the respective
successors and assigns of each of the parties; provided, however, that no Loan
Party may assign this Agreement or any rights or duties hereunder without the Lenders’ prior
written consent and any prohibited assignment shall be absolutely void ab initio. No consent to
assignment by the Lenders shall release any Loan Party from its Obligations. A Lender may assign
this Agreement and the other Loan Documents and its rights and duties hereunder and thereunder
pursuant to Section 13.1 and, except as expressly required pursuant to Section 13.1, no consent or
approval by any Loan Party is required in connection with any such assignment.


14. AMENDMENTS; WAIVERS.




     14.1 Amendments and Waivers.



          (a) No amendment, waiver or other modification of any provision of this Agreement or any other
Loan Document (other than Bank Product Agreements or the Fee Letter), and no consent with respect
to any departure by any Loan Party therefrom, shall be effective unless the same shall be in
writing and signed by the Required Lenders (or by Agent at the written request of the Required
Lenders) and the Loan Parties that are party thereto and then any such waiver or consent shall be



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effective, but only in the specific instance and for the specific purpose for which given;
provided, however, that no such waiver, amendment, or consent shall, unless in
writing and signed by all of the Lenders directly affected thereby and all of the Loan Parties that
are party thereto, do any of the following:




               (i) increase the amount of or extend the expiration date of any Commitment of any Lender or
amend, modify, or eliminate the last sentence of Section 2.4(c)(i),



               (ii) postpone or delay any date fixed by this Agreement or any other Loan Document for any
payment of principal, interest, fees, or other amounts due hereunder or under any other Loan
Document,



               (iii) reduce the principal of, or the rate of interest on, any loan or other extension of
credit hereunder, or reduce any fees or other amounts payable hereunder or under any other Loan
Document (except (A) in connection with the waiver of applicability of Section 2.6(c) (which waiver
shall be effective with the written consent of the Required Lenders), and (B) that any amendment or
modification of defined terms used in the financial covenants in this Agreement shall not
constitute a reduction in the rate of interest or a reduction of fees for purposes of this clause
(iii)),



               (iv) amend, modify, or eliminate this Section or any provision of this Agreement providing for
consent or other action by all Lenders,



               (v) other than as permitted by Section 15.11, release Agent’s Lien in and to any of the
Collateral,



               (vi) amend, modify, or eliminate the definition of “Required Lenders” or “Pro Rata Share”,



               (vii) contractually subordinate any of Agent’s Liens,



               (viii) other than in connection with a merger, liquidation, dissolution or sale of such Person
expressly permitted by the terms hereof or the other Loan Documents, release any Borrower or any
Guarantor from any obligation for the payment of money or consent to the assignment or transfer by
any Borrower or any Guarantor of any of its rights or duties under this Agreement or the other Loan
Documents,



               (ix) amend, modify, or eliminate any of the provisions of Section 2.4(b)(i), (ii) or (iii), or
Section 2.4(e)(i),



               (x) amend, modify, or eliminate any of the provisions of Section 13.1(a) to permit a Loan
Party or an Affiliate of a Loan Party to be permitted to become an Assignee, or



               (xi) amend, modify, or eliminate the definition of Borrowing Base or Ex-Im Borrowing Base or
any of the defined terms (including the definitions of Eligible Accounts, Eligible Insurance
Accounts, Eligible Inventory, and Eligible In-Transit Inventory), that are used in such definition
to the extent that any such change results in more credit being made available to any Borrower
based upon the Borrowing Base or Ex-Im Borrowing Base, but not otherwise.




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          (b) No amendment, waiver, modification, elimination, or consent shall amend, modify, or waive
(i) the definition of, or any of the terms or provisions of, the Fee Letter, without the written
consent of Agent and Administrative Borrower (and shall not require the written consent of any of
the Lenders), and (ii) any provision of Section 15 pertaining to Agent, or any other rights or
duties of Agent under this Agreement or the other Loan Documents, without the written consent of
Agent, Administrative Borrower, and the Required Lenders. Notwithstanding anything to the contrary
contained in this Agreement or the other Loan Documents, the consent of Loan Parties and Lenders
shall not be required for the exercise by Agent of any of its rights under this Agreement in
accordance with the terms of this Agreement with respect to reserves, or the Borrowing Base or
Ex-Im Borrowing Base or any of the defined terms (including the definitions of Eligible Accounts,
Eligible Insurance Accounts, Eligible Inventory and Eligible In-Transit Inventory) that are used
therein.




          (c) No amendment, waiver, modification, elimination, or consent shall amend, modify, or waive
any provision of this Agreement or the other Loan Documents pertaining to Issuing Lender, or any
other rights or duties of Issuing Lender under this Agreement or the other Loan Documents, without
the written consent of Issuing Lender, Agent, Administrative Borrower, and the Required Lenders,




          (d) No amendment, waiver, modification, elimination, or consent shall amend, modify, or waive
any provision of this Agreement or the other Loan Documents pertaining to Swing Line Lender, or any
other rights or duties of Swing Line Lender under this Agreement or the other Loan Documents,
without the written consent of Swing Line Lender, Agent, Administrative Borrower, and the Required
Lenders,




          (e) Anything in this Section 14.1 to the contrary notwithstanding, (i) any amendment,
modification, elimination, waiver, consent, termination, or release of, or with respect to, any
provision of this Agreement or any other Loan Document that relates only to the relationship of the
Lender Group among themselves, and that does not affect the rights or obligations of Borrowers,
shall not require consent by or the agreement of any Loan Party, and (ii) any amendment, waiver,
modification, elimination, or consent of or with respect to any provision of this Agreement or any
other Loan Document may be entered into without the consent of, or over the objection of, any
Defaulting Lender.




          (f) Anything in this Section 14.1 to the contrary notwithstanding, this Agreement may be
amended with the written consent of Agent, Borrowers and the Lenders providing the Replacement
Revolving Loans (as defined below) to permit the refinancing of any portion of the outstanding
Advances (“Refinanced Revolving Loans”) with a replacement revolving loan facility (“Replacement
Revolving Loans”) hereunder; provided, that (i) the aggregate amount of commitments
for such Replacement Revolving Loans shall not exceed the aggregate amount of commitments for such
Refinanced Term Loans, (ii) the Base Rate Margin and the Libor Rate Margin with respect to such
Replacement Revolving Loans (together with the letter of credit fees and unused line fees
applicable to such Replacement Revolving Loans) shall not be higher than those in effect for such
Refinanced Revolving Loans for such Refinanced Revolving Loans immediately prior to such
refinancing, (iii) the Weighted Average Life to Maturity of such Replacement Revolving Loans shall
not be shorter than the Weighted Average Life to Maturity of such Refinanced Revolving Loans at the
time of such refinancing and (iv) all other terms applicable to such Replacement






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Revolving Loans shall be substantially identical to, or less favorable to the Lenders
providing such Replacement Revolving Loans than, those applicable to such Refinanced Loans, except
to the extent necessary to provide for covenants and other terms applicable to any period after the
latest final maturity of the Advances in effect immediately prior to such refinancing.




     14.2 Replacement of Certain Lenders.



          (a) If (i) any action to be taken by the Lender Group or Agent hereunder requires the consent,
authorization, or agreement of all Lenders or all Lenders affected thereby and if such action has
received the consent, authorization, or agreement of the Required Lenders but not of all Lenders or
all Lenders affected thereby, or (ii) any Lender makes a claim for compensation under Section 16,
then Administrative Borrower or Agent, upon at least five (5) Business Days prior irrevocable
notice, may permanently replace any Lender that failed to give its consent, authorization, or
agreement (a “Holdout Lender”) or any Lender that made such a claim for compensation (a “Tax
Lender”) with one or more Replacement Lenders, and the Holdout Lender or Tax Lender, as applicable,
shall have no right to refuse to be replaced hereunder. Such notice to replace the Holdout Lender
or Tax Lender, as applicable, shall specify an effective date for such replacement, which date
shall not be later than fifteen (15) Business Days after the date such notice is given.




          (b) Prior to the effective date of such replacement, the Holdout Lender or Tax Lender, as
applicable, and each Replacement Lender shall execute and deliver an Assignment and Acceptance,
subject only to the Holdout Lender or Tax Lender, as applicable, being repaid in full its share of
the outstanding Obligations (without any premium or penalty of any kind whatsoever, but including
(i) all interest, fees and other amounts that may be due in payable in respect thereof, and (ii) an
assumption of its Pro Rata Share of the Letters of Credit). If the Holdout Lender or Tax Lender,
as applicable, shall refuse or fail to execute and deliver any such Assignment and Acceptance prior
to the effective date of such replacement, Agent may, but shall not be required to, execute and
deliver such Assignment and Acceptance in the name or and on behalf of the Holdout Lender or Tax
Lender, as applicable, and irrespective of whether Agent executes and delivers such Assignment and
Acceptance, the Holdout Lender or Tax Lender, as applicable, shall be deemed to have executed and
delivered such Assignment and Acceptance. The replacement of any Holdout Lender or Tax Lender, as
applicable, shall be made in accordance with the terms of Section 13.1. Until such time as one or
more Replacement Lenders shall have acquired all of the Obligations, the Commitments, and the other
rights and obligations of the Holdout Lender or Tax Lender, as applicable, hereunder and under the
other Loan Documents, the Holdout Lender or Tax Lender, as applicable, shall remain obligated to
make the Holdout Lender’s or Tax Lender’s, as applicable, Pro Rata Share of Advances and to
purchase a participation in each Letter of Credit, in an amount equal to its Pro Rata Share of such
Letters of Credit.




     14.3 No Waivers; Cumulative Remedies. No failure by Agent or any Lender to exercise
any right, remedy, or option under this Agreement or any other Loan Document, or delay by Agent or
any Lender in exercising the same, will operate as a waiver thereof. No waiver by Agent or any
Lender will be effective unless it is in writing, and then only to the extent specifically stated.
No waiver by Agent or any Lender on any occasion shall affect or diminish Agent’s and each Lender’s
rights thereafter to require strict performance by Loan Parties of any provision of this Agreement.
Agent’s and each Lender’s rights under this Agreement and the other Loan Documents will be
cumulative and not exclusive of any other right or remedy that Agent or any Lender may have.



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15. AGENT; THE LENDER GROUP.




     15.1 Appointment and Authorization of Agent. Each Lender hereby designates and
appoints WFCF as its agent under this Agreement and the other Loan Documents and each Lender hereby
irrevocably authorizes (and by entering into a Bank Product Agreement, each Bank Product Provider
shall be deemed to designate, appoint, and authorize) Agent to execute and deliver each of the
other Loan Documents on its behalf and to take such other action on its behalf under the provisions
of this Agreement and each other Loan Document and to exercise such powers and perform such duties
as are expressly delegated to Agent by the terms of this Agreement or any other Loan Document,
together with such powers as are reasonably incidental thereto. Agent agrees to act as agent for
and on behalf of the Lenders (and the Bank Product Providers) on the conditions contained in this
Section 15. Any provision to the contrary contained elsewhere in this Agreement or in any other
Loan Document notwithstanding, Agent shall not have any duties or responsibilities, except those
expressly set forth herein or in the other Loan Documents, nor shall Agent have or be deemed to
have any fiduciary relationship with any Lender (or Bank Product Provider), and no implied
covenants, functions, responsibilities, duties, obligations or liabilities shall be read into this
Agreement or any other Loan Document or otherwise exist against Agent. Without limiting the
generality of the foregoing, the use of the term “agent” in this Agreement or the other Loan
Documents with reference to Agent is not intended to connote any fiduciary or other implied (or
express) obligations arising under agency doctrine of any applicable law. Instead, such term is
used merely as a matter of market custom, and is intended to create or reflect only a
representative relationship between independent contracting parties. Each Lender hereby further
authorizes (and by entering into a Bank Product Agreement, each Bank Product Provider shall be
deemed to authorize) Agent to act as the secured party under each of the Loan Documents that create
a Lien on any item of Collateral. Except as expressly otherwise provided in this Agreement, Agent
shall have and may use its sole discretion with respect to exercising or refraining from exercising
any discretionary rights or taking or refraining from taking any actions that Agent expressly is
entitled to take or assert under or pursuant to this Agreement and the other Loan Documents.
Without limiting the generality of the foregoing, or of any other provision of the Loan Documents
that provides rights or powers to Agent, Lenders agree that Agent shall have the right to exercise
the following powers as long as this Agreement remains in effect: (a) maintain, in accordance
with its customary business practices, ledgers and records reflecting the status of the
Obligations, the Collateral, the Collections of Parent and its Subsidiaries, and related matters,
(b) execute or file any and all financing or similar statements or notices, amendments, renewals,
supplements, documents, instruments, proofs of claim, notices and other written agreements with
respect to the Loan Documents, (c) make Advances, for itself or on behalf of Lenders, as provided
in the Loan Documents, (d) exclusively receive, apply, and distribute the Collections of Parent
and its Subsidiaries as provided in the Loan Documents, (e) open and maintain such bank accounts
and cash management arrangements as Agent deems necessary and appropriate in accordance with the
Loan Documents for the foregoing purposes with respect to the Collateral and the Collections of
Parent and its Subsidiaries, (f) perform, exercise, and enforce any and all other rights and
remedies of the Lender Group with respect to Parent and its Subsidiaries, the Obligations, the
Collateral, the Collections of Parent and its Subsidiaries, or otherwise related to any of same as
provided in the Loan Documents, and (g) incur and pay such Lender Group Expenses as Agent may deem
necessary or appropriate for the performance and fulfillment of its functions and powers pursuant
to the Loan Documents.



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     15.2 Delegation of Duties. Agent may execute any of its duties under this Agreement
or any other Loan Document by or through agents, employees or attorneys in fact and shall be
entitled to advice of counsel concerning all matters pertaining to such duties. Agent shall not be
responsible for the negligence or misconduct of any agent or attorney in fact that it selects as
long as such selection was made without gross negligence or willful misconduct.



     15.3 Liability of Agent. None of the Agent-Related Persons shall (a) be liable for
any action taken or omitted to be taken by any of them under or in connection with this Agreement
or any other Loan Document or the transactions contemplated hereby (except for its own gross
negligence or willful misconduct), or (b) be responsible in any manner to any of the Lenders (or
Bank Product Providers) for any recital, statement, representation or warranty made by any Parent
or any Subsidiary or Affiliate of Parent, or any officer or director thereof, contained in this
Agreement or in any other Loan Document, or in any certificate, report, statement or other document
referred to or provided for in, or received by Agent under or in connection with, this Agreement or
any other Loan Document, or the validity, effectiveness, genuineness, enforceability or sufficiency
of this Agreement or any other Loan Document, or for any failure of Parent or any Subsidiary of
Parent or any other party to any Loan Document to perform its obligations hereunder or thereunder.
No Agent-Related Person shall be under any obligation to any Lenders (or Bank Product Providers) to
ascertain or to inquire as to the observance or performance of any of the agreements contained in,
or conditions of, this Agreement or any other Loan Document, or to inspect the books and records or
properties of Parent or any Subsidiary of Parent.



     15.4 Reliance by Agent. Agent shall be entitled to rely, and shall be fully protected
in relying, upon any writing, resolution, notice, consent, certificate, affidavit, letter,
telegram, telefacsimile or other electronic method of transmission, telex or telephone message,
statement or other document or conversation believed by it to be genuine and correct and to have
been signed, sent, or made by the proper Person or Persons, and upon advice and statements of legal
counsel (including counsel to Borrowers or counsel to any Lender), independent accountants and
other experts selected by Agent. Agent shall be fully justified in failing or refusing to take any
action under this Agreement or any other Loan Document unless Agent shall first receive such advice
or concurrence of the Lenders as it deems appropriate and until such instructions are received,
Agent shall act, or refrain from acting, as it deems advisable. If Agent so requests, it shall
first be indemnified to its reasonable satisfaction by the Lenders (and, if it so elects, the Bank
Product Providers) against any and all liability and expense that may be incurred by it by reason
of taking or continuing to take any such action. Agent shall in all cases be fully protected in
acting, or in refraining from acting, under this Agreement or any other Loan Document in accordance
with a request or consent of the Required Lenders and such request and any action taken or failure
to act pursuant thereto shall be binding upon all of the Lenders (and Bank Product Providers).



     15.5 Notice of Default or Event of Default. Agent shall not be deemed to have
knowledge or notice of the occurrence of any Default or Event of Default, except with respect to
defaults in the payment of principal, interest, fees, and expenses required to be paid to Agent for
the account of the Lenders and, except with respect to Events of Default of which Agent has actual
knowledge, unless Agent shall have received written notice from a Lender or Administrative Borrower
referring to this Agreement, describing such Default or Event of Default, and stating that such
notice is a “notice of default.” Agent promptly will notify the Lenders of its receipt of any such
notice or of any Event of Default of which Agent has actual knowledge. If any Lender obtains
actual



65









 




knowledge of any Event of Default, such Lender promptly shall notify the other Lenders and
Agent of such Event of Default. Each Lender shall be solely responsible for giving any notices to
its Participants, if any. Subject to Section 15.4, Agent shall take such action with respect to
such Default or Event of Default as may be requested by the Required Lenders in accordance with
Section 9; provided, however, that unless and until Agent has received any such
request, Agent may (but shall not be obligated to) take such action, or refrain from taking such
action, with respect to such Default or Event of Default as it shall deem advisable.




     15.6 Credit Decision. Each Lender (and Bank Product Provider) acknowledges that none
of the Agent-Related Persons has made any representation or warranty to it, and that no act by
Agent hereinafter taken, including any review of the affairs of Parent and its Subsidiaries or
Affiliates, shall be deemed to constitute any representation or warranty by any Agent-Related
Person to any Lender (or Bank Product Provider). Each Lender represents (and by entering into a
Bank Product Agreement, each Bank Product Provider shall be deemed to represent) to Agent that it
has, independently and without reliance upon any Agent-Related Person and based on such due
diligence, documents and information as it has deemed appropriate, made its own appraisal of and
investigation into the business, prospects, operations, property, financial and other condition and
creditworthiness of any Borrower or any other Person party to a Loan Document, and all applicable
bank regulatory laws relating to the transactions contemplated hereby, and made its own decision to
enter into this Agreement and to extend credit to any Borrower. Each Lender also represents (and
by entering into a Bank Product Agreement, each Bank Product Provider shall be deemed to represent)
that it will, independently and without reliance upon any Agent-Related Person and based on such
documents and information as it shall deem appropriate at the time, continue to make its own credit
analysis, appraisals and decisions in taking or not taking action under this Agreement and the
other Loan Documents, and to make such investigations as it deems necessary to inform itself as to
the business, prospects, operations, property, financial and other condition and creditworthiness
of any Borrower or any other Person party to a Loan Document. Except for notices, reports, and
other documents expressly herein required to be furnished to the Lenders by Agent, Agent shall not
have any duty or responsibility to provide any Lender (or Bank Product Provider) with any credit or
other information concerning the business, prospects, operations, property, financial and other
condition or creditworthiness of any Borrower or any other Person party to a Loan Document that may
come into the possession of any of the Agent-Related Persons. Each Lender acknowledges (and by
entering into a Bank Product Agreement, each Bank Product Provider shall be deemed to acknowledge)
that Agent does not have any duty or responsibility, either initially or on a continuing basis
(except to the extent, if any, that is expressly specified herein) to provide such Lender (or Bank
Product Provider) with any credit or other information with respect to any Borrower, its Affiliates
or any of their respective business, legal, financial or other affairs, and irrespective of whether
such information came into Agent’s or its Affiliates’ or representatives’ possession before or
after the date on which such Lender became a party to this Agreement (or such Bank Product Provider
entered into a Bank Product Agreement).



     15.7 Costs and Expenses; Indemnification. In the event Agent is not reimbursed by
Parent or its Subsidiaries for Lender Group Expenses incurred by Agent, each Lender hereby agrees
that it is and shall be obligated to pay to Agent such Lender’s ratable share thereof. Whether or
not the transactions contemplated hereby are consummated, each of the Lenders, on a ratable basis,
shall indemnify and defend the Agent-Related Persons (to the extent not reimbursed by or on behalf
of Borrowers and without limiting the obligation of Borrowers to do so) from and against any and
all



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Indemnified Liabilities; provided, however, that no Lender shall be liable for
the payment to any Agent-Related Person of any portion of such Indemnified Liabilities resulting
solely from such Person’s gross negligence or willful misconduct nor shall any Lender be liable for
the obligations of any Defaulting Lender in failing to make an Advance or other extension of credit
hereunder. Without limitation of the foregoing, each Lender shall reimburse Agent upon demand for
such Lender’s ratable share of any costs or out of pocket expenses (including attorneys,
accountants, advisors, and consultants fees and expenses) incurred by Agent in connection with the
preparation, execution, delivery, administration, modification, amendment, or enforcement (whether
through negotiations, legal proceedings or otherwise) of, or legal advice in respect of rights or
responsibilities under, this Agreement or any other Loan Document to the extent that Agent is not
reimbursed for such expenses by or on behalf of Borrowers. The undertaking in this Section shall
survive the payment of all Obligations hereunder and the resignation or replacement of Agent.




     15.8 Agent in Individual Capacity. WFCF and its Affiliates may make loans to, issue
letters of credit for the account of, accept deposits from, provide Bank Products to, acquire
equity interests in, and generally engage in any kind of banking, trust, financial advisory,
underwriting, or other business with Borrowers and their Subsidiaries and Affiliates and any other
Person party to any Loan Document as though WFCF were not Agent hereunder, and, in each case,
without notice to or consent of the other members of the Lender Group. The other members of the
Lender Group acknowledge (and by entering into a Bank Product Agreement, each Bank Product Provider
shall be deemed to acknowledge) that, pursuant to such activities, WFCF or its Affiliates may
receive information regarding each Borrower or its Affiliates or any other Person party to any Loan
Documents that is subject to confidentiality obligations in favor of Borrowers or such other Person
and that prohibit the disclosure of such information to the Lenders (or Bank Product Providers),
and the Lenders acknowledge (and by entering into a Bank Product Agreement, each Bank Product
Provider shall be deemed to acknowledge) that, in such circumstances (and in the absence of a
waiver of such confidentiality obligations, which waiver Agent will use its reasonable best efforts
to obtain), Agent shall not be under any obligation to provide such information to them. The terms
“Lender” and “Lenders” include WFCF in its individual capacity.



     15.9 Successor Agent. Agent may resign as Agent upon thirty (30) days prior written
notice to the Lenders (unless such notice is waived by the Required Lenders) and Administrative
Borrower (unless such notice is waived by Administrative Borrower) and without any notice to the
Bank Product Providers. If Agent resigns under this Agreement, the Required Lenders shall be
entitled, with (so long as no Event of Default has occurred and is continuing) the consent of
Administrative Borrower (such consent not to be unreasonably withheld, delayed, or conditioned),
appoint a successor Agent for the Lenders (and the Bank Product Providers). If, at the time that
Agent’s resignation is effective, it is acting as the Issuing Lender or the Swing Line Lender, such
resignation shall also operate to effectuate its resignation as the Issuing Lender or the Swing
Line Lender, as applicable, and it shall automatically be relieved of any further obligation to
issue Letters of Credit, to cause the Underlying Issuer to issue Letters of Credit, or to make
Swing Line Loans. If no successor Agent is appointed prior to the effective date of the
resignation of Agent, Agent may appoint, after consulting with the Lenders and Administrative
Borrower, a successor Agent. If Agent has breached or failed to perform any provision of this
Agreement or of applicable law in any material respect, the Required Lenders may agree in writing
to remove and replace Agent with a successor Agent from among the Lenders with (so long as no Event
of Default has occurred and is continuing) the consent of Administrative Borrower (such consent not
to be unreasonably withheld,



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delayed, or conditioned). In any such event, upon the acceptance of its appointment as
successor Agent hereunder, such successor Agent shall succeed to all the rights, powers, and duties
of the retiring Agent and the term “Agent” 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 15 shall inure to its benefit as to
any actions taken or omitted to be taken 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 following a
retiring Agent’s notice of resignation, the retiring Agent’s resignation shall nevertheless
thereupon become effective and the Lenders shall perform all of the duties of Agent hereunder until
such time, if any, as the Lenders appoint a successor Agent as provided for above.




     15.10 Lender in Individual Capacity. Any Lender and its respective Affiliates may
make loans to, issue letters of credit for the account of, accept deposits from, provide Bank
Products to, acquire equity interests in and generally engage in any kind of banking, trust,
financial advisory, underwriting, or other business with Borrowers and their Subsidiaries and
Affiliates and any other Person party to any Loan Documents as though such Lender were not a Lender
hereunder without notice to or consent of the other members of the Lender Group (or the Bank
Product Providers). The other members of the Lender Group acknowledge (and by entering into a Bank
Product Agreement, each Bank Product Provider shall be deemed to acknowledge) that, pursuant to
such activities, such Lender and its respective Affiliates may receive information regarding their
or its Affiliates or any other Person party to any Loan Documents that is subject to
confidentiality obligations in favor of any Borrower or such other Person and that prohibit the
disclosure of such information to the Lenders, and the Lenders acknowledge (and by entering into a
Bank Product Agreement, each Bank Product Provider shall be deemed to acknowledge) that, in such
circumstances (and in the absence of a waiver of such confidentiality obligations, which waiver
such Lender will use its reasonable best efforts to obtain), such Lender shall not be under any
obligation to provide such information to them.



     15.11 Collateral Matters.



          (a) The Lenders hereby irrevocably authorize (and by entering into a Bank Product Agreement,
each Bank Product Provider shall be deemed to authorize) Agent to release any Lien on any
Collateral (i) upon the termination of the Commitments and payment and satisfaction in full by
Borrowers of all of the Obligations, (ii) constituting property being sold or disposed of if a
release is required or desirable in connection therewith in a transaction permitted pursuant to
Section 6.4 of this Agreement and if so requested by Agent Administrative Borrower certifies to
Agent that the sale or disposition is permitted under Section 6.4 (and Agent may rely conclusively
on any such certificate, without further inquiry), (iii) constituting property in which Parent or
its Subsidiaries owned no interest at the time Agent’s Lien was granted nor at any time thereafter,
or (iv) constituting property leased to Parent or its Subsidiaries under a lease that has expired
or is terminated in a transaction permitted under this Agreement. The Loan Parties and the Lenders
hereby irrevocably authorize (and by entering into a Bank Product Agreement, each Bank Product
Provider shall be deemed to authorize) Agent, based upon the instruction of the Required Lenders,
in connection with the exercise of rights or remedies following the occurrence and during
continuance of an Event of Default, to credit bid and purchase (either directly or through one or
more acquisition vehicles) all or any portion of the Collateral at any sale thereof conducted by
Agent under the provisions of the UCC, including pursuant to Sections 9-610 or 9-620 of the UCC, at
any sale thereof conducted under the provisions of the Bankruptcy Code, including Section 363 of
the Bankruptcy Code, or at any sale






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or foreclosure conducted by Agent (whether by judicial action or otherwise) in accordance with
applicable law. Each Lender (and by entering into a Bank Product Agreement, each Bank Product
Provider) agrees that, except with the written consent of Agent and the Required Lenders, it will
not exercise any right that it might otherwise have to credit bid at any sales of all or any
portion of the Collateral conducted under the provisions of the Code or the Bankruptcy Code, or in
connection with foreclosure sales or other similar dispositions of Collateral. Except as provided
above, Agent will not execute and deliver a release of any Lien on any Collateral without the prior
written authorization of (A) if the release is of all or substantially all of the Collateral, all
of the Lenders (without requiring the authorization of the Bank Product Providers), or (B)
otherwise, the Required Lenders (without requiring the authorization of the Bank Product
Providers). Upon request by Agent or Administrative Borrower at any time, the Lenders will (and if
so requested, the Bank Product Providers will) confirm in writing Agent’s authority to release any
such Liens on particular types or items of Collateral pursuant to this Section 15.11;
provided, however, that (1) Agent shall not be required to execute any document
necessary to evidence such release on terms that, in Agent’s opinion, would expose Agent to
liability or create any obligation or entail any consequence other than the release of such Lien
without recourse, representation, or warranty, and (2) such release shall not in any manner
discharge, affect, or impair the obligations or any Liens (other than those expressly being
released) upon (or obligations of Borrowers in respect of) all interests retained by Loan Parties,
including, the proceeds of any sale, all of which shall continue to constitute part of the
Collateral. The Lenders further hereby irrevocably authorize (and by entering into a Bank Product
Agreement, each Bank Product Provider shall be deemed to authorize) Agent, at its option and in its
sole discretion, to subordinate any Lien granted to or held by Agent under any Loan Document to the
holder of any Permitted Lien on such property if such Permitted Lien secures Permitted Purchase
Money Indebtedness.




          (b) Agent shall have no obligation whatsoever to any of the Lenders (or the Bank Product
Providers) to assure that the Collateral exists or is owned by Parent or its Subsidiaries or is
cared for, protected, or insured or has been encumbered, or that Agent’s Liens have been properly
or sufficiently or lawfully created, perfected, protected, or enforced or are entitled to any
particular priority, or that any particular items of Collateral meet the eligibility criteria
applicable in respect thereof or whether to impose, maintain, reduce, or eliminate any particular
reserve hereunder or whether the amount of any such reserve is appropriate or not, 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
pursuant to any of the Loan Documents, it being understood and agreed that in respect of the
Collateral, or any act, omission, or event related thereto, subject to the terms and conditions
contained herein, Agent may act in any manner it may deem appropriate, in its sole discretion given
Agent’s own interest in the Collateral in its capacity as one of the Lenders and that Agent shall
have no other duty or liability whatsoever to any Lender (or Bank Product Provider) as to any of
the foregoing, except as otherwise provided herein.




     15.12 Restrictions on Actions by Lenders; Sharing of Payments.



          (a) Each of the Lenders agrees that it shall not, without the express written consent of
Agent, and that it shall, to the extent it is lawfully entitled to do so, upon the written request
of Agent, set off against the Obligations, any amounts owing by such Lender to Parent or its
Subsidiaries or any deposit accounts of Parent or its Subsidiaries now or hereafter maintained with
such Lender. Each of the Lenders further agrees that it shall not, unless specifically requested
to do






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so in writing by Agent, take or cause to be taken any action, including, the commencement of
any legal or equitable proceedings to enforce any Loan Document against any Borrower or any
Guarantor or to foreclose any Lien on, or otherwise enforce any security interest in, any of the
Collateral.




          (b) If, at any time or times any Lender shall receive (i) by payment, foreclosure, setoff, or
otherwise, any proceeds of Collateral or any payments with respect to the Obligations, except for
any such proceeds or payments received by such Lender from Agent pursuant to the terms of this
Agreement, or (ii) payments from Agent in excess of such Lender’s Pro Rata Share of all such
distributions by Agent, such Lender promptly shall (A) turn the same over to Agent, in kind, and
with such endorsements as may be required to negotiate the same to Agent, or in immediately
available funds, as applicable, for the account of all of the Lenders and for application to the
Obligations in accordance with the applicable provisions of this Agreement, or (B) purchase,
without recourse or warranty, an undivided interest and participation in the Obligations owed to
the other Lenders so that such excess payment received shall be applied ratably as among the
Lenders in accordance with their Pro Rata Shares; provided, however, that to the
extent that such excess payment received by the purchasing party is thereafter recovered from it,
those purchases of participations shall be rescinded in whole or in part, as applicable, and the
applicable portion of the purchase price paid therefor shall be returned to such purchasing party,
but without interest except to the extent that such purchasing party is required to pay interest in
connection with the recovery of the excess payment.




     15.13 Agency for Perfection. Agent hereby appoints each other Lender (and each Bank
Product Provider) as its agent (and each Lender hereby accepts (and by entering into a Bank Product
Agreement, each Bank Product Provider shall be deemed to accept) such appointment) for the purpose
of perfecting Agent’s Liens in assets which, in accordance with Article 8 or Article 9, as
applicable, of the UCC can be perfected by possession or control. Should any Lender obtain
possession or control of any such Collateral, such Lender shall notify Agent thereof, and, promptly
upon Agent’s request therefor shall deliver possession or control of such Collateral to Agent or in
accordance with Agent’s instructions.



     15.14 Payments by Agent to the Lenders. All payments to be made by Agent to the
Lenders (or Bank Product Providers) shall be made by bank wire transfer of immediately available
funds pursuant to such wire transfer instructions as each party may designate for itself by written
notice to Agent. Concurrently with each such payment, Agent shall identify whether such payment
(or any portion thereof) represents principal, premium, fees, or interest of the Obligations.



     15.15 Concerning the Collateral and Related Loan Documents. Each member of the Lender
Group authorizes and directs Agent to enter into this Agreement and the other Loan Documents. Each
member of the Lender Group agrees (and by entering into a Bank Product Agreement, each Bank Product
Provider shall be deemed to agree) that any action taken by Agent in accordance with the terms of
this Agreement or the other Loan Documents relating to the Collateral and the exercise by Agent of
its powers set forth therein or herein, together with such other powers that are reasonably
incidental thereto, shall be binding upon all of the Lenders (and such Bank Product Provider).



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     15.16 Audits and Examination Reports; Confidentiality; Disclaimers by Lenders; Other
Reports and Information. By becoming a party to 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 respecting Parent or its Subsidiaries
(each, a “Report”) prepared by or at the request of Agent pursuant to the terms of this Agreement,
and Agent shall so furnish each Lender with such Reports,




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




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




          (d) agrees to keep all Reports and other material, non-public information regarding Parent and
its Subsidiaries and their operations, assets, and existing and contemplated business plans in a
confidential manner in accordance with Section 17.9, and




          (e) without limiting the generality of any other indemnification provision contained in this
Agreement, agrees: (i) to hold Agent and any other Lender preparing a Report harmless from any
action the indemnifying Lender may take or fail to take or any conclusion the indemnifying Lender
may reach or draw from any Report in connection with any loans or other credit accommodations that
the indemnifying Lender has made or may make to any Borrower, or the indemnifying Lender’s
participation in, or the indemnifying Lender’s purchase of, a loan or loans of a Borrower, and (ii)
to pay and protect, and indemnify, defend and hold Agent, and any such other Lender preparing a
Report harmless from and against, the claims, actions, proceedings, damages, costs, expenses, and
other amounts (including, attorneys fees and costs) incurred by Agent and any such other Lender
preparing a Report as the direct or indirect result of any third parties who might obtain all or
part of any Report through the indemnifying Lender.



In addition to the foregoing: (A) any Lender may from time to time request of Agent in writing
that Agent provide to such Lender a copy of any report or document provided by Parent or its
Subsidiaries to Agent that has not been contemporaneously provided by Parent or such Subsidiary to
such Lender, and, upon receipt of such request, Agent promptly shall provide a copy of same to such
Lender, (B) to the extent that Agent is entitled, under any provision of the Loan Documents, to
request additional reports or information from Parent or its Subsidiaries, any Lender may, from
time to time, reasonably request Agent to exercise such right as specified in such Lender’s notice
to Agent, whereupon Agent promptly shall request of Administrative Borrower the additional reports
or information reasonably specified by such Lender, and, upon receipt thereof from Administrative
Borrower or such Subsidiary, Agent promptly shall provide a copy of same to such Lender, and (C)
any time that Agent renders to Administrative Borrower a statement regarding the Loan Account,
Agent shall send a copy of such statement to each Lender.







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     15.17 Several Obligations; No Liability. Notwithstanding that certain of the Loan
Documents now or hereafter may have been or will be executed only by or in favor of Agent in its
capacity as such, and not by or in favor of the Lenders, any and all obligations on the part of
Agent (if any) to make any credit available hereunder shall constitute the several (and not joint)
obligations of the respective Lenders on a ratable basis, according to their respective
Commitments, to make an amount of such credit not to exceed, in principal amount, at any one time
outstanding, the amount of their respective Commitments. Nothing contained herein shall confer
upon any Lender any interest in, or subject any Lender to any liability for, or in respect of, the
business, assets, profits, losses, or liabilities of any other Lender. Each Lender shall be solely
responsible for notifying its Participants of any matters relating to the Loan Documents to the
extent any such notice may be required, and no Lender shall have any obligation, duty, or liability
to any Participant of any other Lender. Except as provided in Section 15.7, no member of the
Lender Group shall have any liability for the acts of any other member of the Lender Group. No
Lender shall be responsible to any Borrower or any other Person for any failure by any other Lender
(or Bank Product Provider) to fulfill its obligations to make credit available hereunder, nor to
advance for such Lender (or Bank Product Provider) or on its behalf, nor to take any other action
on behalf of such Lender (or Bank Product Provider) hereunder or in connection with the financing
contemplated herein.


16. TAXES.




          (a) All payments made by Loan Parties hereunder or under any other Loan Document will be made
without setoff, counterclaim, or other defense. In addition, all such payments will be made free
and clear of, and without deduction or withholding for, any present or future Taxes, and in the
event any deduction or withholding of Taxes is required, Loan Parties shall comply with the next
sentence of this Section 16(a). If any Taxes are so levied or imposed, each Loan Party agrees to
pay the full amount of such Taxes and such additional amounts as may be necessary so that every
payment of all amounts due under this Agreement or any other Loan Document, including any amount
paid pursuant to this Section 16(a) after withholding or deduction for or on account of any Taxes,
will not be less than the amount provided for herein; provided, however, that no Loan Party shall
be required to increase any such amounts if the increase in such amount payable results from
Agent’s or such Lender’s own willful misconduct or gross negligence (as finally determined by a
court of competent jurisdiction). Loan Parties will furnish to Agent as promptly as possible after
the date the payment of any Tax is due pursuant to applicable law, certified copies of tax receipts
evidencing such payment by Loan Parties.




          (b) Each Loan Party agrees to pay any present or future stamp, value added 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, performance, recordation, or filing of, or
otherwise with respect to this Agreement or any other Loan Document, which payments shall be made
to the applicable Governmental Authority in accordance with applicable laws.




          (c) If a Lender or Participant is entitled to claim an exemption or reduction from United
States withholding tax, such Lender or Participant agrees with and in favor of Agent, to deliver to
Agent (or, in the case of a Participant, to the Lender granting the participation only) one of the
following on or before the date it becomes a party to this Agreement (or, in the case of a
Participant, on or before such Participant acquires the participation) and at such other times as
may






72









 







be necessary in the reasonable determination of Parent or Agent to confirm that payments to
such Lender or Participant may be made without, or at a reduced rate, of withholding:




               (i) Any Foreign Lender or Participant that is entitled to claim an exemption from, or
reduction in, United States withholding tax shall deliver to the Agent two completed originals of
(1) either United States Internal Revenue Service Form W-8BEN, W-8ECI or Form W-8IMY (together with
any applicable underlying forms), or any subsequent versions thereof or successors thereto; (2) in
the case of a Foreign Lender claiming exemption from or reduction in U.S. federal withholding tax
under Section 871(h) or 881(c) of the IRC with respect to payments of “portfolio interest,” (A) a
statement of the Lender or Participant that it is not a (I) a “bank” as described in Section
881(c)(3)(A) of the IRC, (II) a ten (10%) percent shareholder of a Borrower (within the meaning of
Section 881(c)(3)(B) of the IRC), or (III) a controlled foreign corporation related to a Borrower
within the meaning of Section 881(c)(3)(C) of the IRC, and (B) a properly completed and executed
IRS Form W-8BEN or Form W-8IMY (with proper attachments); or (3) any other document prescribed by
the Internal Revenue Service certifying as to the entitlement of such Foreign Lender to such
exemption, or reduced rate, from United States withholding tax with respect to all payments to be
made to such Foreign Lender under this Agreement and the other Loan Documents; or



               (ii) If such Lender is a Domestic Lender, two original completed Internal Revenue Service
Forms W-9 certifying as to such Lender’s entitlement to full exemption from United States
withholding tax, or otherwise proving that it is entitled to such an exemption.


Each Lender or Participant shall provide new forms (or successor forms) upon the expiration or
obsolescence of any previously delivered forms and to promptly notify Agent (or, in the case of a
Participant, to the Lender granting the participation only) of any change in circumstances which
would modify or render invalid any claimed exemption or reduction.




          (d) If a Lender or Participant claims an exemption from withholding tax in a jurisdiction
other than the United States, such Lender or such Participant agrees with and in favor of Agent and
Parent, to deliver to Agent and Parent (or, in the case of a Participant, to the Lender granting
the participation only) any such form or forms, as may be required under the laws of such
jurisdiction as a condition to exemption from, or reduction of, foreign withholding or backup
withholding tax before receiving its first payment under this Agreement, but only if such Lender or
such Participant is legally able to deliver such forms, provided, however,
that nothing in this Section 16(d) shall require a Lender or Participant to disclose any
information that it deems to be confidential (including without limitation, its tax returns). Each
Lender and each Participant shall provide new forms (or successor forms) upon the expiration or
obsolescence of any previously delivered forms and to promptly notify Agent and Parent (or, in the
case of a Participant, to the Lender granting the participation only) of any change in
circumstances which would modify or render invalid any claimed exemption or reduction.




          (e) If a Lender or Participant claims exemption from, or reduction of, withholding tax and
such Lender or Participant sells, assigns, grants a participation in, or otherwise transfers all or
part of the Obligations of Borrowers to such Lender or Participant, such Lender or Participant
agrees to notify Agent (or, in the case of a sale of a participation interest, to the Lender
granting the participation only) of the percentage amount in which it is no longer the beneficial
owner of






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Obligations of Borrowers to such Lender or Participant. To the extent of such percentage
amount, Agent will treat such Lender’s or such Participant’s documentation provided pursuant to
Section 16(c) or 16(d) as no longer valid. With respect to such percentage amount, such
Participant or Assignee may provide new documentation, pursuant to Section 16(c) or 16(d), if
applicable. Each Borrower agrees that each Participant shall be entitled to the benefits of this
Section 16 with respect to its participation in any portion of the Commitments and the Obligations
so long as such Participant complies with the obligations set forth in this Section 16 with respect
thereto.




          (f) If a Lender or a Participant is entitled to a reduction in the applicable withholding tax,
Agent (or, in the case of a Participant, the Lender granting the participation) may withhold from
any interest payment to such Lender or such Participant an amount equivalent to the applicable
withholding tax after taking into account such reduction. If the forms or other documentation
required by Section 16(c) or 16(d) are not delivered to Agent (or, in the case of a Participant, to
the Lender granting the participation), then Agent (or, in the case of a Participant, the Lender
granting the participation) may withhold from any interest payment to such Lender or such
Participant not providing such forms or other documentation an amount equivalent to the applicable
withholding tax.




          (g) If the IRS or any other Governmental Authority of the United States or other jurisdiction
asserts a claim that Agent (or, in the case of a Participant, the Lender granting the
participation) did not properly withhold tax from amounts paid to or for the account of any Lender
or any Participant due to a failure on the part of the Lender or any Participant (because the
appropriate form was not delivered, was not properly executed, or because such Lender failed to
notify Agent (or such Participant failed to notify the Lender granting the participation) of a
change in circumstances which rendered the exemption from, or reduction of, withholding tax
ineffective, or for any other reason) such Lender shall indemnify and hold Agent harmless (or, in
the case of a Participant, such Participant shall indemnify and hold the Lender granting the
participation harmless) for all amounts paid, directly or indirectly, by Agent (or, in the case of
a Participant, the Lender granting the participation), as tax or otherwise, including penalties and
interest, and including any taxes imposed by any jurisdiction on the amounts payable to Agent (or,
in the case of a Participant, to the Lender granting the participation only) under this Section 16,
together with all costs and expenses (including attorneys fees and expenses). The obligation of
the Lenders and the Participants under this subsection shall survive the payment of all Obligations
and the resignation or replacement of Agent.




          (h) If Agent or a Lender determines, in its sole discretion, that it has received a refund of
any Taxes as to which it has been indemnified by the Loan Parties or with respect to which the Loan
Parties have paid additional amounts pursuant to this Section 16, so long as no Event of Default
has occurred and is continuing, it shall pay over such refund to the Loan Parties (but only to the
extent of payments made, or additional amounts paid, by the Loan Parties under this Section 16 with
respect to Taxes giving rise to such a refund), net of all out-of-pocket expenses of Agent or such
Lender and without interest (other than any interest paid by the relevant Governmental Authority
with respect to such a refund); provided, that, the Loan Parties, upon the request
of Agent or such Lender, agree to repay the amount paid over to the Loan Parties (plus any
penalties, interest or other charges, imposed by the relevant Governmental Authority, other than
such penalties, interest or other charges imposed as a result of the willful misconduct or gross
negligence of Agent or such Lender hereunder) to Agent or such Lender in the event Agent or such
Lender is required to repay such refund to such Governmental Authority. Notwithstanding anything
in this Agreement to the






74









 







contrary, this Section 16 shall not be construed to require Agent or any Lender to make
available its tax returns (or any other information which it deems confidential) to Borrowers or
any other Person.




          (i) Any Lender or Participant claiming any additional amounts payable pursuant to this Section
16 shall use its reasonable efforts (consistent with its internal policies and requirements of law)
to change the jurisdiction of its lending office if such a change would reduce any such additional
amounts (or any similar amount that may thereafter accrue) and would not, in the sole determination
of such Lender or Participant, be otherwise disadvantageous to such Lender or Participant.




          (j) If a payment made to Agent or any Lender hereunder or under any other Loan Document would
be subject to withholding tax imposed by FATCA if Agent or such Lender fails to comply with
applicable reporting and other requirements of FATCA, Agent or such Lender shall deliver to Parent
and Agent, at the time or times prescribed by applicable law or as reasonably requested by Parent
or Agent, (A) two accurate, complete and signed certifications prescribed by applicable law or
reasonably satisfactory to Parent and Agent that establish that such payment is exempt from
withholding tax imposed by FATCA and (B) any other documentation reasonably requested by Parent or
Agent sufficient for Parent and Agent to comply with their obligations under FATCA and to determine
that Agent or such Lender has complied with such applicable reporting and other requirements of
FATCA.



17. GENERAL PROVISIONS.




     17.1 Effectiveness. This Agreement shall be binding and deemed effective when
executed by Administrative Borrower, Agent, and each Lender whose signature is provided for on the
signature pages hereof.



     17.2 Section Headings. Headings and numbers have been set forth herein for
convenience only. Unless the contrary is compelled by the context, everything contained in each
Section applies equally to this entire Agreement.



     17.3 Interpretation. Neither this Agreement nor any uncertainty or ambiguity herein
shall be construed against the Lender Group or Loan Parties, whether under any rule of construction
or otherwise. On the contrary, this Agreement has been reviewed by all parties and shall be
construed and interpreted according to the ordinary meaning of the words used so as to accomplish
fairly the purposes and intentions of all parties hereto.



     17.4 Severability of Provisions. Each provision of this Agreement shall be severable
from every other provision of this Agreement for the purpose of determining the legal
enforceability of any specific provision.



     17.5 Bank Product Providers. Each Bank Product Provider shall be deemed a third party
beneficiary hereof and of the provisions of the other Loan Documents for purposes of any reference
in a Loan Document to the parties for whom Agent is acting. Agent hereby agrees to act as agent
for such Bank Product Providers and, by virtue of entering into a Bank Product Agreement, the
applicable Bank Product Provider shall be automatically deemed to have appointed Agent as its agent
and to have accepted the benefits of the Loan Documents; it being understood and agreed that



75









 




the rights and benefits of each Bank Product Provider under the Loan Documents consist
exclusively of such Bank Product Provider’s being a beneficiary of the Liens and security interests
(and, if applicable, guarantees) granted to Agent and the right to share in payments and
collections out of the Collateral as more fully set forth herein. In addition, each Bank Product
Provider, by virtue of entering into a Bank Product Agreement, shall be automatically deemed to
have agreed that Agent shall have the right, but shall have no obligation, to establish, maintain,
relax, or release reserves in respect of the Bank Product Obligations and that if reserves are
established there is no obligation on the part of Agent to determine or insure whether the amount
of any such reserve is appropriate or not. In connection with any such distribution of payments or
proceeds of Collateral, Agent shall be entitled to assume no amounts are due or owing to any Bank
Product Provider unless such Bank Product Provider has provided a written certification (setting
forth a reasonably detailed calculation) to Agent as to the amounts that are due and owing to it
and such written certification is received by Agent a reasonable period of time prior to the making
of such distribution. Agent shall have no obligation to calculate the amount due and payable with
respect to any Bank Products, but may rely upon the written certification of the amount due and
payable from the relevant Bank Product Provider. In the absence of an updated certification, Agent
shall be entitled to assume that the amount due and payable to the relevant Bank Product Provider
is the amount last certified to Agent by such Bank Product Provider as being due and payable (less
any distributions made to such Bank Product Provider on account thereof). Loan Parties may obtain
Bank Products from any Bank Product Provider, although no Loan Party is required to do so. Each
Loan Party acknowledges and agrees that no Bank Product Provider has committed to provide any Bank
Products and that the providing of Bank Products by any Bank Product Provider is in the sole and
absolute discretion of such Bank Product Provider. Notwithstanding anything to the contrary in
this Agreement or any other Loan Document, no provider or holder of any Bank Product shall have any
voting or approval rights hereunder (or be deemed a Lender) solely by virtue of its status as the
provider or holder of such agreements or products or the Obligations owing thereunder, nor shall
the consent of any such provider or holder be required (other than in their capacities as Lenders,
to the extent applicable) for any matter hereunder or under any of the other Loan Documents,
including as to any matter relating to the Collateral or the release of Collateral or Guarantors.
Each Hedge Provider shall, prior to the consummation of each transaction under any Hedge Agreement,
(i) notify Agent in writing of its status as a Hedge Provider and (ii) if, at the time that such
Hedge Provider enters into such transaction, such Hedge Provider is also a party to (or an
Affiliate of a party to) the Term Loan Agreement, elect, as between its Lien on the Revolving Loan
Party Collateral and its Lien on the Term Loan Priority Collateral, which Lien will be a first
priority Lien and which Lien will be a second priority Lien (in each case, subject to Liens
permitted to be prior to such Liens hereunder or under the Term Loan Agreement), which election
must be notified to Agent in writing (it being understood and agreed that any such Person that
elects to have its lien on the Term Loan Priority Collateral be a first priority Lien shall not
constitute a “Hedge Provider” for purposes of this Agreement).




     17.6 Debtor-Creditor Relationship. The relationship between the Lenders and Agent, on
the one hand, and the Loan Parties, on the other hand, is solely that of creditor and debtor. No
member of the Lender Group has (or shall be deemed to have) any fiduciary relationship or duty to
any Loan Party arising out of or in connection with the Loan Documents or the transactions
contemplated thereby, and there is no agency or joint venture relationship between the members of



76









 




the Lender Group, on the one hand, and the Loan Parties, on the other hand, by virtue of any
Loan Document or any transaction contemplated therein.




     17.7 Counterparts; Electronic Execution. This Agreement may be executed in any number
of counterparts and by different parties on separate counterparts, each of which, when executed and
delivered, shall be deemed to be an original, and all of which, when taken together, shall
constitute but one and the same Agreement. Delivery of an executed counterpart of this Agreement
by telefacsimile or other electronic method of transmission shall be equally as effective as
delivery of an original executed counterpart of this Agreement. Any party delivering an executed
counterpart of this Agreement by telefacsimile or other electronic method of transmission also
shall deliver an original executed counterpart of this Agreement but the failure to deliver an
original executed counterpart shall not affect the validity, enforceability, and binding effect of
this Agreement. The foregoing shall apply to each other Loan Document mutatis mutandis.



     17.8 Revival and Reinstatement of Obligations. If the incurrence or payment of the
Obligations by any Borrower or Guarantor or the transfer to the Lender Group of any property should
for any reason subsequently be asserted, or declared, to be void or voidable under any state or
federal law relating to creditors’ rights, including provisions of the Bankruptcy Code relating to
fraudulent conveyances, preferences, or other voidable or recoverable payments of money or
transfers of property (each, a “Voidable Transfer”), and if the Lender Group is required to repay
or restore, in whole or in part, any such Voidable Transfer, or elects to do so upon the reasonable
advice of its counsel, then, as to any such Voidable Transfer, or the amount thereof that the
Lender Group is required or elects to repay or restore, and as to all reasonable costs, expenses,
and attorneys fees of the Lender Group related thereto, the liability of each Borrower and
Guarantor automatically shall be revived, reinstated, and restored and shall exist as though such
Voidable Transfer had never been made.



     17.9 Confidentiality.



          (a) Agent and Lenders each individually (and not jointly or jointly and severally) agree that
material, non-public information regarding Parent and its Subsidiaries, their operations, assets,
and existing and contemplated business plans (“Confidential Information”) shall be treated by Agent
and the Lenders in a confidential manner, and shall not be disclosed by Agent and the Lenders to
Persons who are not parties to this Agreement, except: (i) to attorneys for and other advisors,
accountants, auditors, and consultants to any member of the Lender Group (“Lender Group
Representatives”), (ii) to Subsidiaries and Affiliates of any member of the Lender Group (including
the Bank Product Providers), provided, that, any such Subsidiary or Affiliate shall
have agreed in writing for the benefit of Borrowers to receive such information hereunder subject
to the terms of this Section 17.9, (iii) as may be required by regulatory authorities so long as
such authorities are informed of the confidential nature of such information, (iv) as may be
required by statute, decision, or judicial or administrative order, rule, or regulation;
provided, that, (A) prior to any disclosure under this clause (iv), the disclosing
party agrees to provide Administrative Borrower with prior notice thereof, to the extent that it is
practicable to do so and to the extent that the disclosing party is permitted to provide such prior
notice to Administrative Borrower pursuant to the terms of the applicable statute, decision, or
judicial or administrative order, rule, or regulation and (B) any disclosure under this clause (iv)
shall be limited to the portion of the Confidential Information as may be required by such statute,
decision, or judicial or administrative order, rule, or regulation, (v)






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as may be agreed to in advance by Administrative Borrower or as requested or required by any
Governmental Authority pursuant to any subpoena or other legal process, provided,
that, (A) prior to any disclosure under this clause (v) the disclosing party agrees to
provide Administrative Borrower with prior notice thereof, to the extent that it is practicable to
do so and to the extent that the disclosing party is permitted to provide such prior notice to
Administrative Borrower pursuant to the terms of the subpoena or other legal process and (B) any
disclosure under this clause (v) shall be limited to the portion of the Confidential Information as
may be required by such governmental authority pursuant to such subpoena or other legal process,
(vi) as to any such information that is or becomes generally available to the public (other than as
a result of prohibited disclosure by Agent or the Lenders or the Lender Group Representatives),
(vii) in connection with any assignment, participation or pledge of any Lender’s interest under
this Agreement, provided, that, any such assignee, participant, or pledgee shall
have agreed to receive such information hereunder subject to the terms of this Section, (viii) in
connection with any litigation or other adversary proceeding involving parties hereto which such
litigation or adversary proceeding involves claims related to the rights or duties of such parties
under this Agreement or the other Loan Documents; provided, that, prior to any
disclosure to any Person (other than any Loan Party, Agent, any Lender, any of their respective
Affiliates, or their respective counsel) under this clause (viii) with respect to litigation
involving any Person (other than Loan Parties, Agent, any Lender, any of their respective
Affiliates, or their respective counsel), the disclosing party agrees to provide Borrowers with
prior notice thereof, and (ix) in connection with, and to the extent reasonably necessary for, the
exercise of any secured creditor remedy under this Agreement or under any other Loan Document.




          (b) Anything in this Agreement to the contrary notwithstanding, Agent may provide information
concerning the terms and conditions of this Agreement and the other Loan Documents to loan
syndication and pricing reporting services.



     17.10 Lender Group Expenses. Loan Parties agree to pay any and all Lender Group
Expenses promptly after demand therefor by Agent and agrees that their obligations contained in
this Section 17.10 shall survive payment or satisfaction in full of all other Obligations.



     17.11 Survival. All representations and warranties made by the Loan Parties in the
Loan Documents and in the certificates or other instruments delivered in connection with or
pursuant to this Agreement or any other Loan Document shall be considered to have been relied upon
by the other parties hereto and shall survive the execution and delivery of the Loan Documents and
the making of any loans and issuance of any Letters of Credit, regardless of any investigation made
by any such other party or on its behalf and notwithstanding that Agent, the Issuing Lender, or any
Lender may have had notice or knowledge of any Default or Event of Default or incorrect
representation or warranty at the time any credit is extended hereunder, and shall continue in full
force and effect as long as the principal of or any accrued interest on any loan or any fee or any
other amount payable under this Agreement is outstanding and unpaid or any Letter of Credit is
outstanding and so long as the Commitments have not expired or terminated.



     17.12 USA PATRIOT Act. Each Lender that is subject to the requirements of the Patriot
Act hereby notifies each Loan Party that pursuant to the requirements of the Act, it is required to
obtain, verify and record information that identifies such Loan Party, which information includes
the name and address of such Loan Party and other information that will allow such Lender to
identify such Loan Party in accordance with the Patriot Act.



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     17.13 Integration. This Agreement, together with the other Loan Documents, reflects
the entire understanding of the parties with respect to the transactions contemplated hereby and
shall not be contradicted or qualified by any other agreement, oral or written, before the date
hereof. The foregoing to the contrary notwithstanding, all Bank Product Agreements, if any, are
independent agreements governed by the written provisions of such Bank Product Agreements, which
will remain in full force and effect, unaffected by any repayment, prepayments, acceleration,
reduction, increase, or change in the terms of any credit extended hereunder, except as otherwise
expressly provided in such Bank Product Agreement.



     17.14 Ex-Im Bank Rules. Each Loan Party acknowledges that Lenders are willing to make
the Ex-Im advances available to US Borrower because Ex-Im Bank is willing to guarantee payment of a
significant portion of the Ex-Im Advances pursuant to the Ex-Im Guarantee. Accordingly, in the
event of any inconsistency between the Ex-Im Guarantee or any of the other Ex-Im Bank Documents and
any of the Loan Documents, the provision that is more stringent, burdensome or restrictive upon the
Loan Parties shall control solely for so long as any Ex-Im Advances are outstanding. This
Agreement is supplemental to the Borrower Agreement and the Fast Track Borrower Supplement and
constitutes the “Loan Agreement” under the Borrower Agreement. The facility for Ex-Im Advances
hereunder constitutes the “Loan Facility” under the Borrower Agreement.



[SIGNATURE PAGES TO FOLLOW]




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



	 	 	 	 	 
	 	TRONOX LLC

 	 
	 	By:  	 	 
	 	 	Title: 	 	 
	 	 	 	 
	 	TRONOX WORLDWIDE LLC

 	 
	 	By:  	 	 
	 	 	Title: 	 	 
	 	 	 	 
	 	TRONOX FINANCE CORP.

CIMARRON CORPORATION

TRIPLE S REFINING CORPORATION

SOUTHWESTERN REFINING COMPANY, INC.

TRANSWORLD DRILLING COMPANY

TRIPLE S MINERALS RESOURCES CORPORATION

TRIPLE S, INC.

TRONOX HOLDINGS, INC.

TRIANGLE REFINERIES, INC.

TRONOX PIGMENTS (SAVANNAH) INC.

 	 
	 	By:  	 	 
	 	 	Title: 	 	 
	 	 	 	 
	 	TRONOX INCORPORATED

 	 
	 	By:  	 	 
	 	 	Title: 	 	 
	 	 	 
	 	By:  	
 	 
	 	 	Title: 	 	 



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	 	WELLS FARGO CAPITAL FINANCE, LLC,

as Agent and a Lender

 	 
	 	By:  	 	 
	 	 	Title: 	 	 




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