EX-10.3






Exhibit 10.3




TELEFLEX INCORPORATED




155 South Limerick Road

Limerick, Pennsylvania 19468




As of October 1, 2007




Re: First Amendment (this “Amendment”) to the Note Purchase Agreement dated as of July 8,
2004



TO THE NOTEHOLDERS


REFERENCED BELOW



Ladies and Gentlemen:



Reference is made to the Note Purchase Agreement dated as of July 8, 2004 (as in effect on the
date hereof, the “Existing Note Agreement”, and as amended hereby, the “Note
Agreement”) among Teleflex Incorporated, a Delaware corporation (the “Company”), and
each of the institutions named on the signature pages thereof (the “Purchasers”), pursuant
to which the Purchasers purchased U.S.$350,000,000 in aggregate principal amount of the Company’s
(a) 5.23% Series 2004-1 Tranche A Senior Notes due 2011 (the “Existing Tranche A Notes”),
(b) 5.75% Series 2004-1 Tranche B Senior Notes due 2014 (the “Existing Tranche B Notes”)
and (c) 5.85% Series 2004-1 Tranche C Senior Notes due 2016 (the “Existing Tranche C
Notes”, and together with the Existing Tranche A Notes and the Existing Tranche B Notes,
collectively, the “Existing Notes”). Each current holder of an Existing Note is herein
referred to as a “Noteholder”, and such holders collectively are referred to as the
“Noteholders”.



The Company has requested that the Noteholders agree to amend certain provisions of the
Existing Note Agreement and the Existing Notes, as more fully described herein, and the Noteholders
are willing to amend the Existing Note Agreement and the Existing Notes as provided herein, subject
to the satisfaction of the conditions specified in Section 4 below.



Accordingly, in consideration of the promises and the mutual agreements contained herein, and
for other good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the Company and the Noteholders agree as follows:



Section 1. Definitions. All capitalized terms used herein but not defined herein
shall have the respective meanings ascribed thereto in Schedule B to the Note Agreement (which
Schedule B, as amended pursuant to this Amendment, is set forth on Exhibit E hereto).



Section 2. Amendments. Subject to the satisfaction of the conditions specified in
Section 4:




(a) without further action by any Person,




(i) the form of Existing Tranche A Note attached as Exhibit 1-A to the Existing
Note Agreement, and each outstanding Existing Tranche A Note, are hereby amended and
restated to conform to the form of Existing Tranche A Note attached hereto as
Exhibit A (in the case of each such Existing Tranche A Note outstanding,
with appropriate modifications to reflect the principal amount, registration number,
private placement number, date and registered holder thereof) and each such
outstanding Existing Tranche A Note, as amended hereby, shall be referred to herein
as a “Tranche A Note”;




(ii) the form of Existing Tranche B Note attached as Exhibit 1-B to the
Existing Note Agreement, and each outstanding Existing Tranche B Note, are hereby
amended and restated to conform to the form of Existing Tranche B Note attached
hereto as Exhibit B (in the case of each such Existing Tranche B Note
outstanding, with appropriate modifications to reflect the principal amount,
registration number, private placement number, date and registered holder thereof)
and each such outstanding Existing Tranche B Note, as amended hereby, shall be
referred to herein as a “Tranche B Note”; and




(iii) the form of Existing Tranche C Note attached as Exhibit 1-C to the
Existing Note Agreement, and each outstanding Existing Tranche C Note on the date
hereof, are hereby amended and restated to conform to the form of Existing Tranche C
Note attached hereto as Exhibit C (in the case of each such Existing Tranche
C Note outstanding, with appropriate modifications to reflect the principal amount,
registration number, private placement number, date and registered holder thereof)
and each such outstanding Existing Tranche C Note, as amended hereby, shall be
referred to herein as a “Tranche C Note” and the Tranche C Notes, together
with the Tranche A Notes and the Tranche B Notes shall be referred to herein
collectively as the “Notes”;




and upon the request of any Noteholder, the Company will issue a replacement Note or Notes
in favor of such Noteholder in the appropriate form in exchange for the Note or Notes of
such Noteholder;




(b) the Existing Note Agreement (other than Schedule B thereto) is hereby amended as
set forth in Exhibit D hereto; and




(c) Schedule B to the Existing Note Agreement is hereby amended and restated in its
entirety to read as set forth in Exhibit E hereto.



Section 3. Representations and Warranties. The Company represents and warrants to
each Noteholder on the date hereof as follows (and the parties hereto agree that the following
representations and warranties shall be deemed to have been made pursuant to the Note Agreement for
all relevant purposes thereof):




3.1 Power and Authority. Each Obligor has the corporate power and authority to
execute and deliver this Amendment and the other Financing Documents to which it is a party
that are being executed and delivered in connection therewith (such documents, the
“Amendment Documents”) and to perform its obligations under the Financing Documents
to which it is a party.




3.2 Authorization. The Amendment Documents have been duly authorized by all
necessary action on the part of the Obligors and the Financing Documents constitute legal,
valid and binding obligations of the Obligors party thereto, enforceable against them in
accordance with their terms, except as such enforceability may be limited by (i) applicable
bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting the
enforcement of creditors’ rights generally and (ii) general principles of equity (regardless
of whether such enforceability is considered in a proceeding in equity or at law).




3.3 Valid, Perfected Lien. The Lien of the Pledge Agreement constitutes a
valid, perfected, first priority Lien on the property covered thereby, subject to no prior
or equal Lien except as permitted under Section 10.2 of the Note Agreement.




3.4 No Defaults. No Default or Event of Default has occurred and is continuing
(either before or after giving effect to this Amendment).




3.5 Disclosure. The documentation provided by the Company with respect to the
Transactions (including, without limitation, the 2007 Note Purchase Agreement and the
schedules thereto), taken as a whole, does not contain any untrue statement of a material
fact or omit to state any material fact necessary to make the statements therein not
misleading in light of the circumstances under which they were made; provided that, with
respect to projected financial information or estimates, the Company represents only that
such information was prepared in good faith based upon assumptions believed to be reasonable
as of the date of preparation thereof. Except as disclosed in such documentation, since
December 31, 2006, there has been no change in the financial condition, operations,
business, properties or prospects of the Company or any Subsidiary except changes that
individually or in the aggregate could not reasonably be expected to have a Material Adverse
Effect. There is no fact known to the Company that could reasonably be expected to have a
Material Adverse Effect that has not been set forth herein or in such documentation.




3.6 Pro Forma Financial Statements. The Pro Forma Financial Statements
(defined below), copies of which have heretofore been furnished to each Noteholder, have
been prepared in good faith, based on assumptions believed by the Company to be reasonable
as of the date of preparation thereof.



Further, the Company hereby makes to each Noteholder on the date hereof each of the
representations and warranties contained in Sections 5.1, 5.4 (and attached hereto is Schedule
5.4 in connection therewith), 5.6 through 5.11 (inclusive), 5.12(a)-(d) (inclusive), 5.15 (and
attached hereto is Schedule 5.15 in connection therewith), 5.16(b), 5.17 and 5.18 of the
2007 Note Purchase Agreement (and the parties hereto agree that such representations and warranties
shall be deemed to have been made pursuant to the Amendment Documents and the Note Agreement for
all relevant purposes thereof); provided that, in connection therewith, each capitalized term used
in such provisions of the 2007 Note Purchase Agreement shall be deemed to be a reference to the
same term as it is defined in Exhibit E hereto.



Section 4. Conditions to Effectiveness. This Amendment shall become effective when
each of the following shall have occurred:




(a) this Amendment and the other Amendment Documents shall have been executed and
delivered by the parties thereto;




(b) the Company shall have delivered to the Noteholders (i) a certificate of its
Secretary or Assistant Secretary, dated the date hereof, certifying as to the resolutions
attached thereto and other corporate proceedings relating to the authorization, execution
and delivery of the Amendment Documents to which the Company is a party and (ii) a
certificate of the Secretary or Assistant Secretary of each Subsidiary Guarantor, dated the
date hereof, certifying as to the resolutions attached thereto and other corporate
proceedings relating to the authorization, execution and delivery of the Amendment Documents
to which such Subsidiary Guarantor is a party.




(c) the Company shall have delivered to the Noteholders the audited consolidated
financial statements of Arrow for the fiscal years ended August 31, 2004, August 31, 2005
and August 31, 2006; (ii) the unaudited consolidated financial statements of Arrow for the
fiscal quarters ended November 30, 2006, February 28, 2007 and May 31, 2007; (iii) a pro
forma consolidated balance sheet of the Company and pro forma consolidated income statement
of the Company, each dated as of July 1, 2007, giving pro forma effect to the Arrow
Acquisition and the Transactions (the “Pro Forma Financial Statements”) (as if the
Arrow Acquisition and the Transactions had occurred on such date or at the beginning of such
period, as the case may be); and (iv) a certificate, dated the date hereof and signed by a
Senior Financial Officer of the Company, setting forth a reasonably detailed calculation of
Consolidated EBITDA showing as of June 30, 2007 on a pro forma basis giving effect to the
Arrow Acquisition and the Transactions (as if the Arrow Acquisition and the Transactions had
occurred on such date or at the beginning of such period, as the case may be) Consolidated
EBITDA of not less than $500,000,000;




(d) the Noteholders shall have received opinions in form and substance satisfactory to
such Noteholder, dated the date hereof from Simpson Thacher & Bartlett LLP, special counsel
for the Company, in form and substance satisfactory to such Noteholder (and the Company
hereby instructs its counsel to deliver such opinion to the Noteholders);




(e) the Noteholders shall have received an executed copy of the following documents,
and each of the other agreements and instruments executed in connection therewith, each in
form and substance satisfactory to such Noteholder and certified as true and correct by a
Senior Financial Officer, and each such agreement shall be in full force and effect:




(i) the Bank Credit Agreement;




(ii) the 2007 Note Purchase Agreement; and




(iii) the 2002 NPA Amendment;




and, in the case of the Bank Credit Agreement and the 2007 Note Purchase Agreement, the
Company shall have received the proceeds of all loans to be borrowed by it or all notes to
be issued by it (as the case may be) thereunder;




(f) the Noteholders shall have received an executed copy of the Arrow Acquisition
Agreement and each of the other agreements and instruments executed in connection therewith,
each certified as true and correct by a Senior Financial Officer, and the Arrow Acquisition
shall be consummated in accordance with the Arrow Acquisition Agreement on the date hereof;




(g) the Noteholders shall have received evidence satisfactory to them that all amounts
outstanding under the several Note Purchase Agreements, dated as of November 1, 1992, among
the Company and each of the institutions named on the signature pages thereof, and under the
several Note Purchase Agreements, dated as of December 15, 1993, among the Company and each
of the institutions named on the signature pages thereof, have been paid in full;




(h) the Noteholders shall have received evidence that, (i) the principal of and
interest on outstanding loans, and all accrued fees and all other amounts owing, under that
certain Amended and Restated Credit Agreement, dated as of October 30, 2006 to which the
Company is a party shall have been paid in full, all commitments to extend credit thereunder
shall have been terminated, and all letters of credit issued thereunder and outstanding
immediately prior to the date of Closing shall have been continued pursuant to the Bank
Credit Agreement, and all accrued and unpaid fees in respect of such letters of credit shall
have been paid; and (ii) the principal of and interest on outstanding loans, and all accrued
fees and all other amounts owing, under the Loan Agreement dated as of April 12, 2004 among
Arrow and certain of its Subsidiaries, Wachovia Bank, National Association (f/k/a First
Union National Bank) and Wachovia Bank, National Association, London Branch (f/k/a First
Union National Bank, London Branch) (collectively, the “Existing Arrow
Indebtedness”) shall have been paid in full, and all letters of credit issued thereunder
and outstanding immediately prior to the First Amendment Effective Date shall have been
terminated or replaced by letters of credit issued under the Bank Credit Agreement, and all
Liens securing the Existing Arrow Indebtedness and all guaranties issued in respect thereof
shall have been discharged or released (or arrangements for such discharge or release
satisfactory to the Noteholders shall have been made);




(i) the Company shall have delivered to the Collateral Agent certificates representing
the Pledged Equity Interests (as defined in the Pledge Agreement), accompanied by undated
stock powers executed in blank;




(j) a new Private Placement Number issued by Standard & Poor’s CUSIP Service Bureau (in
cooperation with the Securities Valuation Office of the National Association of Insurance
Commissioners) shall have been obtained for each Series of Notes;




(k) without limiting the provisions of Section 15.1 of the Note Agreement, the Company
shall have paid on or before the date hereof the reasonable fees, charges and disbursements
of Bingham McCutchen LLP, the Noteholders’ special counsel, to the extent reflected in a
statement of such counsel rendered to the Company at least one Business Day prior to such
date;




(l) the Company has paid to each Noteholder an amendment fee in an amount equal to
0.25% (25 basis points) of the aggregate outstanding principal amount of Notes held by such
Noteholder; and




(m) all corporate and other proceedings in connection with the transactions
contemplated by this Amendment and all documents and instruments incident to such
transactions shall be satisfactory to the Noteholders and their special counsel, and the
Noteholders and their special counsel shall have received all such counterpart originals or
certified or other copies of such documents as such Noteholders or such special counsel may
reasonably request.



Section 5. Miscellaneous.




5.1 Ratification; Agreement Unchanged. The Existing Note Agreement and the
Existing Notes are in all respects ratified and confirmed, and the terms, covenants and
agreements thereof shall remain unchanged and in full force and effect except as amended
hereby.




5.2 References to Note Agreement and Notes. From and after the effective date
of this Amendment, all references to “this Agreement” in the Existing Note Agreement and in
the Existing Notes shall be deemed to be references to the Note Agreement.




5.3 Payment of Fees. Without limiting Section 15.1 of the Note Agreement, the
Company agrees to pay the reasonable fees and expenses of Bingham McCutchen LLP, counsel for
the Noteholders, in connection with this Amendment.




5.4 Execution in Counterparts. This Amendment may be executed in counterparts,
each of which shall be deemed an original but all of which together shall constitute one and
the same instrument. Delivery of an executed counterpart of a signature page to this
Amendment by facsimile transmission or electronic mail shall be effective as delivery of a
manually executed counterpart of this Amendment.




5.5 Governing Law. This Amendment shall be construed and enforced in
accordance with, and the rights of the parties shall be governed by, the law of the State of
New York excluding choice-of-law principles of the law of such State that would permit or
require the application of the laws of a jurisdiction other than such State.




5.6 Post-Closing Letter. By their execution and delivery hereof, the
Noteholders hereby acknowledge and agree to that certain letter agreement, dated as of the
date hereof, by the Company in favor of the Noteholders, relating to the delivery of certain
post-closing items, and agree that such letter shall be considered a “Financing Document”
for all purposes of this Agreement.



* * * *




1



If you are in agreement with the foregoing, please sign the form of acceptance in the space
provided below whereupon this Amendment shall become a binding agreement among the Noteholders and
the Company.



Very truly yours,



TELEFLEX INCORPORATED



By: /s/ Kevin K. Gordon

Name: Kevin K. Gordon

Title: Executive Vice President and

Chief Financial Officer




THE FOREGOING AMENDMENT IS HEREBY


ACCEPTED AS OF THE DATE FIRST ABOVE


WRITTEN:



Connecticut General Life Insurance Company



By: CIGNA Investments, Inc. (authorized agent)



By: /s/ Lori E. Hopkins

Name: Lori E. Hopkins

Title: Managing Director




Massachusetts Mutual Life Insurance Company



By: Babson Capital Management LLC





as Investment Adviser



By: /s/ Mark A. Ahmed

Name: Mark A. Ahmed

Title: Managing Director




C.M. Life Insurance Company



By: Babson Capital Management LLC





as Investment Sub-Adviser



By: /s/ Mark A. Ahmed

Name: Mark A. Ahmed

Title: Managing Director




MML Bay State Life Insurance Company



By: Babson Capital Management LLC





as Investment Sub-Adviser



By: /s/ Mark A. Ahmed

Name: Mark A. Ahmed

Title: Managing Director




MassMutual Asia Limited



By: Babson Capital Management LLC


as Investment Adviser



By: /s/ Mark A. Ahmed

Name: Mark A. Ahmed

Title: Managing Director




Hakone Fund LLC



By: Babson Capital Management LLC


as Investment Manager



By: /s/ Mark A. Ahmed

Name: Mark A. Ahmed

Title: Managing Director




Principal Life Insurance Company



By: Principal Global Investors, LLC





a Delaware limited liability company,


its Authorized Signatory



By: /s/ Colin Pennycooke

Name: Colin Pennycooke

Title: Counsel




By: /s/ Christopher Henderson

Name: Christopher Henderson

Title: Associate General Counsel





Country Life Insurance Company



By: /s/ John Jacobs

Name: John Jacobs

Title: Director – Fixed Income













Hartford Life and Annuity Insurance Company



By: Hartford Investment Management Company


Its Agent and Attorney-in-Fact



By: /s/ Matthew J. Poznar

Name: Matthew J. Poznar

Title: Vice President




Hartford Life Insurance Company



By: Hartford Investment Management Company


Its Agent and Attorney-in-Fact



By: /s/ Matthew J. Poznar

Name: Matthew J. Poznar

Title: Vice President




Physicians Life Insurance Company



By: Hartford Investment Management Company


Its Investment Manager



By: /s/ Matthew J. Poznar

Name: Matthew J. Poznar

Title: Vice President




Modern Woodmen of America



By: /s/ Nick S. Coin

Name: Nick S. Coin

Title: Treasurer & Investment Manager





Allstate Life Insurance Company



By: /s/ Robert B. Bodett

Name: Robert B. Bodett

Title: Authorized Signatory





By: /s/ Breege A. Farrell

Name: Breege A. Farrell

Title: Authorized Signatory



American Heritage Life Insurance Company



By: /s/ Robert B. Bodett

Name: Robert B. Bodett

Title: Authorized Signatory





By: /s/ Breege A. Farrell

Name: Breege A. Farrell

Title: Authorized Signatory



State Farm Life Insurance Company



By: /s/ Jeffrey T. Attwood

Name: Jeffrey T. Attwood

Title: Investment Officer





By: /s/ Lisa L. Rogers

Name: Lisa L. Rogers

Title: Investment Officer



American General Life Insurance Company


AIG Life Insurance Company


American International Life Assurance Company of New York



By: /s/ Gerald F. Herman

Name: Gerald F. Herman

Title: Vice President





New York Life Insurance Company



By: /s/ Kathleen A. Haberkern

Name: Kathleen A. Haberkern

Title: Director





New York Life Insurance And Annuity Corporation



By: New York Life Investment Management, LLC,


Its Investment Manager



By: /s/ Kathleen A. Haberkern

Name: Kathleen A. Haberkern

Title: Director




New York Life Insurance and Annuity Corporation Institutionally





Owned Life Insurance Separate Account



By: New York Life Investment Management, LLC,


Its Investment Manager



By: /s/ Kathleen A. Haberkern

Name: Kathleen A. Haberkern

Title: Director




Genworth Life Insurance Company



By: /s/ Stephen DeMotto

Name: Stephen DeMotto

Title: Investment Officer





Employers Reinsurance Company



By: Conning Asset Management Company,


as Investment Manager



By: /s/ Robert M. Mills

Name: Robert M. Mills

Title: Director




Phoenix Life Insurance Company



By: /s/ John H. Beers

Name: John H. Beers

Title: Vice President





The State Life Insurance Company



By: American United Life Insurance Company, its Agent



By: /s/ Michael Bullock

Name: Michael Bullock

Title: V.P. Private Placements




Lafayette Life Insurance Company



By: American United Life Insurance Company, its Agent



By: /s/ Michael Bullock

Name: Michael Bullock

Title: V.P. Private Placements




American United Life Insurance Company



By: /s/ Michael Bullock

Name: Michael Bullock

Title: V.P. Private Placements





Monumental Life Insurance Company



By: /s/ Christopher D. Pahlke

Name: Christopher D. Pahlke

Title: Vice President





Transamerica Life Insurance Company



By: /s/ Christopher D. Pahlke

Name: Christopher D. Pahlke

Title: Vice President





Transamerica Occidental Life Insurance Company



By: /s/ Christopher D. Pahlke

Name: Christopher D. Pahlke

Title: Vice President





Teachers Insurance And Annuity Association of America



By: /s/ Brian K. Roelke

Name: Brian K. Roelke

Title: Director





The Union Central Life Insurance Company



By: Summit Investment Advisors Inc., as Agent



By: /s/ Andrew S. White

Name: Andrew S. White

Title: Managing Director – Private Placements




Ameritas Life Insurance Corp.



By: Summit Investment Advisors Inc., as Agent



By: /s/ Andrew S. White

Name: Andrew S. White

Title: Managing Director – Private Placements




Acacia Life Insurance Company



By: Summit Investment Advisors Inc., as Agent



By: /s/ Andrew S. White

Name: Andrew S. White

Title: Managing Director – Private Placements




American Family Life Insurance Company



By: /s/ Phillip Hannifan

Name: Phillip Hannifan

Title: Investment Director





Assurity Life Insurance Company



By: /s/ Victor Weber

Name: Victor Weber

Title: Senior Director – Investments





The Prudential Insurance Company of America



By: /s/ Yvonne Guajardo

Name: Yvonne Guajardo

Title:Vice President





Prudential Retirement Insurance and Annuity Company

By: Prudential Investment Management, Inc.,




as investment manager



By: /s/ Yvonne Guajardo

Name: Yvonne Guajardo

Title:Vice President





Farmers New World Life Insurance Company



By: Prudential Private Placement Investors, L.P.





(as Investment Advisor)



By: Prudential Private Placement Investors, Inc.


(as its General Partner)



By: /s/ Yvonne Guajardo

Name: Yvonne Guajardo

Title:Vice President







United of Omaha Life Insurance Company



By: Prudential Private Placement Investors, L.P.





(as Investment Advisor)



By: Prudential Private Placement Investors, Inc.


(as its General Partner)



By: /s/ Yvonne Guajardo

Name: Yvonne Guajardo

Title:Vice President







Baystate Investments, LLC



By: Prudential Private Placement Investors, L.P.


(as Investment Advisor)



By: Prudential Private Placement Investors, Inc.





(as its General Partner)



By: /s/ Yvonne Guajardo

Name: Yvonne Guajardo

Title:Vice President







Metropolitan Life Insurance Company of Connecticut



By: /s/ Judith A. Gulotta

Name: Judith A. Gulotta

Title: Director





Woodmen of the World Life Insurance Society



By: /s/ Mark D. Theisen

Name: Mark D. Theisen

Title: Executive Vice President of Finance and Treasurer





By: /s/ Danny E. Cummins

Name: Danny E. Cummins

Title: Executive Vice President for Operations and Secretary



Protective Life Insurance Company



By: /s/ Lance P. Black

Name: Lance P. Black

Title: Vice President











Genworth Life and Health Insurance Company



By: /s/ Amy C. King

Name: Amy C. King

Title: Authorized Signer





By: /s/ Deborah J. Foss

Name: Deborah J. Foss

Title: Authorized Signer



EXHIBIT A




[FORM OF SERIES 2004-1 TRANCHE A NOTE]




TELEFLEX INCORPORATED




SERIES 2004-1 TRANCHE A SENIOR NOTE DUE 2011




	 	 	 
	No. 2004-1-A-[     ]

$[     ]

	 	[Date]

PPN: 879369 E@1






FOR VALUE RECEIVED, the undersigned, TELEFLEX INCORPORATED (herein called the “Company”), a
corporation organized and existing under the laws of the State of Delaware hereby promises to pay
to [     ], or registered assigns, the principal sum of [     ] DOLLARS (or so much
thereof as shall not have been prepaid) on July 8, 2011, with interest (computed on the basis of a
360-day year of twelve 30-day months) (a) on the unpaid balance thereof at the rate in effect
pursuant to the terms of Section 8.9 of the Note Purchase Agreement referred to below, payable
semiannually, on the 8th day of January and July in each year, commencing with the
January 8 or July 8 next succeeding the date hereof, until the principal hereof shall have become
due and payable, and (b) to the extent permitted by law, on any overdue payment (including any
overdue prepayment) of principal, any overdue payment of interest and any overdue payment of any
Make-Whole Amount (as defined in the Note Purchase Agreement referred to below), payable
semiannually as aforesaid (or, at the option of the registered holder hereof, on demand), at a rate
per annum from time to time equal to the Default Rate (as defined in the Note Purchase Agreement
referred to below).



Payments of principal of, interest on and any Make-Whole Amount with respect to this Note are
to be made in lawful money of the United States of America at the principal office of Bank of
America, N.A. in New York, New York or at such other place as the Company shall have designated by
written notice to the holder of this Note as provided in the Note Purchase Agreement referred to
below.



This Note is one of a series of Senior Notes (herein called the “Notes”) issued pursuant to
the Note Purchase Agreement dated as of July 8, 2004 (as from time to time amended and
supplemented, the “Note Purchase Agreement”), between the Company and the respective Purchasers
named therein and is entitled to the benefits thereof. Each holder of this Note will be deemed, by
its acceptance hereof, to have agreed to the confidentiality provisions set forth in Section 20 of
the Note Purchase Agreement and to have made the representation set forth in Section 6.2 of the
Note Purchase Agreement.



This Note is a registered Note and, as provided in the Note Purchase Agreement, upon surrender
of this Note for registration of transfer, duly endorsed, or accompanied by a written instrument of
transfer duly executed, by the registered holder hereof or such holder’s attorney duly authorized
in writing, a new Note for a like principal amount will be issued to, and registered in the name
of, the transferee. Prior to due presentment for registration of transfer, the Company may treat
the person in whose name this Note is registered as the owner hereof for the purpose of receiving
payment and for all other purposes, and the Company will not be affected by any notice to the
contrary.



This Note is subject to prepayment at the times and on the terms specified in the Note
Purchase Agreement, but not otherwise.



If an Event of Default, as defined in the Note Purchase Agreement, occurs and is continuing,
the principal of this Note may be declared or otherwise become due and payable in the manner, at
the price (including any applicable Make-Whole Amount) and with the effect provided in the Note
Purchase Agreement.



This Note shall be construed and enforced in accordance with the laws of the State of New
York.




TELEFLEX INCORPORATED




By     




Title:



2




EXHIBIT B




[FORM OF SERIES 2004-1 TRANCHE B NOTE]




TELEFLEX INCORPORATED




SERIES 2004-1 TRANCHE B SENIOR NOTE DUE 2014




	 	 	 
	No. 2004-1-B-[     ]

$[     ]

	 	[Date]

PPN: 879369 E#9






FOR VALUE RECEIVED, the undersigned, TELEFLEX INCORPORATED (herein called the “Company”), a
corporation organized and existing under the laws of the State of Delaware hereby promises to pay
to [     ], or registered assigns, the principal sum of [     ] DOLLARS (or so much
thereof as shall not have been prepaid) on July 8, 2014, with interest (computed on the basis of a
360-day year of twelve 30-day months) (a) on the unpaid balance thereof at the rate in effect
pursuant to the terms of Section 8.9 of the Note Purchase Agreement referred to below, payable
semiannually, on the 8th day of January and July in each year, commencing with the
January 8 or July 8 next succeeding the date hereof, until the principal hereof shall have become
due and payable, and (b) to the extent permitted by law, on any overdue payment (including any
overdue prepayment) of principal, any overdue payment of interest and any overdue payment of any
Make-Whole Amount (as defined in the Note Purchase Agreement referred to below), payable
semiannually as aforesaid (or, at the option of the registered holder hereof, on demand), at a rate
per annum from time to time equal to the Default Rate (as defined in the Note Purchase Agreement
referred to below).



Payments of principal of, interest on and any Make-Whole Amount with respect to this Note are
to be made in lawful money of the United States of America at the principal office of Bank of
America, N.A. in New York, New York or at such other place as the Company shall have designated by
written notice to the holder of this Note as provided in the Note Purchase Agreement referred to
below.



This Note is one of a series of Senior Notes (herein called the “Notes”) issued pursuant to
the Note Purchase Agreement dated as of July 8, 2004 (as from time to time amended and
supplemented, the “Note Purchase Agreement”), between the Company and the respective Purchasers
named therein and is entitled to the benefits thereof. Each holder of this Note will be deemed, by
its acceptance hereof, to have agreed to the confidentiality provisions set forth in Section 20 of
the Note Purchase Agreement and to have made the representation set forth in Section 6.2 of the
Note Purchase Agreement.



This Note is a registered Note and, as provided in the Note Purchase Agreement, upon surrender
of this Note for registration of transfer, duly endorsed, or accompanied by a written instrument of
transfer duly executed, by the registered holder hereof or such holder’s attorney duly authorized
in writing, a new Note for a like principal amount will be issued to, and registered in the name
of, the transferee. Prior to due presentment for registration of transfer, the Company may treat
the person in whose name this Note is registered as the owner hereof for the purpose of receiving
payment and for all other purposes, and the Company will not be affected by any notice to the
contrary.



This Note is subject to prepayment at the times and on the terms specified in the Note
Purchase Agreement, but not otherwise.



If an Event of Default, as defined in the Note Purchase Agreement, occurs and is continuing,
the principal of this Note may be declared or otherwise become due and payable in the manner, at
the price (including any applicable Make-Whole Amount) and with the effect provided in the Note
Purchase Agreement.



This Note shall be construed and enforced in accordance with the laws of the State of New
York.




TELEFLEX INCORPORATED




By     




Title:



3




EXHIBIT C




[FORM OF SERIES 2004-1 TRANCHE C NOTE]




TELEFLEX INCORPORATED




SERIES 2004-1 TRANCHE C SENIOR NOTE DUE 2016




	 	 	 
	No. 2004-1-C-[     ]

$[     ]

	 	[Date]

PPN: 879369 F*2






FOR VALUE RECEIVED, the undersigned, TELEFLEX INCORPORATED (herein called the “Company”), a
corporation organized and existing under the laws of the State of Delaware hereby promises to pay
to [     ], or registered assigns, the principal sum of [     ] DOLLARS (or so much
thereof as shall not have been prepaid) on July 8, 2016, with interest (computed on the basis of a
360-day year of twelve 30-day months) (a) on the unpaid balance thereof at the rate in effect
pursuant to the terms of Section 8.9 of the Note Purchase Agreement referred to below, payable
semiannually, on the 8th day of January and July in each year, commencing with the
January 8 or July 8 next succeeding the date hereof, until the principal hereof shall have become
due and payable, and (b) to the extent permitted by law, on any overdue payment (including any
overdue prepayment) of principal, any overdue payment of interest and any overdue payment of any
Make-Whole Amount (as defined in the Note Purchase Agreement referred to below), payable
semiannually as aforesaid (or, at the option of the registered holder hereof, on demand), at a rate
per annum from time to time equal to the Default Rate (as defined in the Note Purchase Agreement
referred to below).



Payments of principal of, interest on and any Make-Whole Amount with respect to this Note are
to be made in lawful money of the United States of America at the principal office of Bank of
America, N.A. in New York, New York or at such other place as the Company shall have designated by
written notice to the holder of this Note as provided in the Note Purchase Agreement referred to
below.



This Note is one of a series of Senior Notes (herein called the “Notes”) issued pursuant to
the Note Purchase Agreement dated as of July 8, 2004 (as from time to time amended and
supplemented, the “Note Purchase Agreement”), between the Company and the respective Purchasers
named therein and is entitled to the benefits thereof. Each holder of this Note will be deemed, by
its acceptance hereof, to have agreed to the confidentiality provisions set forth in Section 20 of
the Note Purchase Agreement and to have made the representation set forth in Section 6.2 of the
Note Purchase Agreement.



This Note is a registered Note and, as provided in the Note Purchase Agreement, upon surrender
of this Note for registration of transfer, duly endorsed, or accompanied by a written instrument of
transfer duly executed, by the registered holder hereof or such holder’s attorney duly authorized
in writing, a new Note for a like principal amount will be issued to, and registered in the name
of, the transferee. Prior to due presentment for registration of transfer, the Company may treat
the person in whose name this Note is registered as the owner hereof for the purpose of receiving
payment and for all other purposes, and the Company will not be affected by any notice to the
contrary.



This Note is subject to prepayment at the times and on the terms specified in the Note
Purchase Agreement, but not otherwise.



If an Event of Default, as defined in the Note Purchase Agreement, occurs and is continuing,
the principal of this Note may be declared or otherwise become due and payable in the manner, at
the price (including any applicable Make-Whole Amount) and with the effect provided in the Note
Purchase Agreement.



This Note shall be construed and enforced in accordance with the laws of the State of New
York.




TELEFLEX INCORPORATED




By     




Title:



4




EXHIBIT D




1. Section 1.2 of the Existing Note Agreement is hereby amended and restated in its entirety as
follows:



1.2 The Series 2004-1 Notes.



The Company will authorize, as the initial Series of Notes hereunder, the issue and sale, in
three tranches, of $350,000,000 aggregate principal amount of its senior notes, of which
$150,000,000 aggregate principal amount shall be its Series 2004-1 Tranche A Senior Notes due 2011
(as such notes may be amended, restated or otherwise modified and in effect from time to time, the
“Series 2004-1 Tranche A Notes”), $100,000,000 aggregate principal amount shall be its Series
2004-1 Tranche B Senior Notes due 2014 (as such notes may be amended, restated or otherwise
modified and in effect from time to time, the “Series 2004-1 Tranche B Notes”) and $100,000,000
aggregate principal amount shall be its Series 2004-1 Tranche C Senior Notes due 2016 (as such
notes may be amended, restated or otherwise modified and in effect from time to time, the “Series
2004-1 Tranche C Notes” and, together with the Series 2004-1 Tranche A Notes and the Series 2004-1
Tranche B Notes, the “Series 2004-1 Notes”, such term to include any such notes issued in
substitution therefor pursuant to Section 13). The Series 2004-1 Tranche A Notes, Series 2004-1
Tranche B Notes and Series 2004-1 Tranche C Notes shall be substantially in the form set out in
Exhibits 1-A, 1-B and 1-C, respectively, with such changes therefrom, if any, as may be approved by
each Purchaser and the Company.



2. Section 7.1(a) of the Existing Note Agreement is hereby amended by replacing the number “60” in
the first line thereof with the number “50”.



3. Section 7.1(b) of the Existing Note Agreement is hereby amended by:



(a) replacing the number “105” in the first line thereof with the number “75”;



(b) in the second line of the paragraph following clause (ii) thereof, (i) inserting “(A)”
after the phrase “and accompanied by”, and creating a new clause (A) with the remainder of such
paragraph (beginning with the newly inserted “(A)”) and adding the word “and” immediately following
the comma at the end of such newly created paragraph, and (ii) after the phrase “an opinion thereon
of independent certified public accountants of recognized national standing”, adding the
parenthetical expression “(without a “going concern” or like qualification or exception and without
any qualification or exception as to the scope of such audit)”; and



(c) inserting a new clause (B) thereof, immediately following such newly created clause (A),
to read in its entirety as follows:




(B) if requested by the Required Holders or if delivered to the Bank Lenders, a
certificate of such accountants stating that they have reviewed this Agreement and stating
whether, in making their audit, they have become aware of any condition or event that then
constitutes a Default or an Event of Default, and, if they are aware that any such condition
or event then exists, specifying the nature and period of the existence thereof (it being
understood that such accountants shall not be liable, directly or indirectly, for any
failure to obtain knowledge of any Default or Event of Default unless such accountants
should have obtained knowledge thereof in making an audit in accordance with generally
accepted auditing standards or did not make such an audit),



4. Section 7.1(c) of the Existing Note Agreement is hereby amended and restated in its entirety as
follows:



(c) [Intentionally Omitted]



5. Section 7.1(d) of the Existing Note Agreement is hereby amended and restated in its entirety as
follows:



(d) SEC and Other Reports — promptly upon their becoming available, one copy of (i)
each financial statement, report, notice or proxy statement sent by the Company or any Subsidiary
to the Bank Lenders or other principal lending banks (excluding information sent to the Bank
Lenders or such other banks in the ordinary course of administration of the Bank Credit Agreement
or their other bank facilities) or to its public securities holders generally, and (ii) each
regular or periodic report, each registration statement (without exhibits except as expressly
requested by such holder), and each prospectus and all amendments thereto filed by the Company or
any Subsidiary with the SEC and of all press releases and other statements made available generally
by the Company or any Subsidiary to the public concerning developments that are Material;



6. Section 7.1(f) of the Existing Note Agreement is hereby amended by inserting at the end of such
section “accompanied in each case by a statement of a Responsible Officer setting forth the details
of such event and the action taken or proposed to be taken with respect thereto;”.



7. Section 7.1(g) of the Existing Note Agreement is hereby amended by replacing the phrase “have a
Material Adverse Effect” in the fourth line thereof with “result in liability of the Company and
its Subsidiaries in an aggregate amount exceeding $35,000,000”;



8. Section 7.1(i) of the Existing Note Agreement is hereby deleted and replaced with a new Section
7.1(i) to read in its entirety as follows:



(i) Material Adverse Effect — promptly upon any Responsible Officer becoming aware
thereof, notice of any development that has, or could reasonably be expected to have a Material
Adverse Effect;



9. Existing Section 7.1(j) is hereby relettered as Section 7.1(k) and a new Section 7.1(j) is
hereby added immediately following Section 7.1(i) to read in its entirety as follows:



(j) Bank Credit Agreement and Other Senior Note Agreement Amendments — promptly after
the execution thereof, copies of all amendments to the Bank Credit Agreement and the Other Senior
Note Agreements; and



10. Section 7.2(a) of the Existing Note Agreement is hereby amended and restated in its entirety as
follows:



(a) Covenant Compliance — the information (including detailed calculations) required
in order to establish whether the Company was in compliance with the requirements of Sections 10.1,
10.2, 10.4, 10.4A, 10.5, 10.6 and 10.9, during the quarterly or annual period covered by the
statements then being furnished (including with respect to each such Section, where applicable, the
calculations of the maximum or minimum amount, ratio or percentage, as the case may be, permissible
under the terms of such Sections, and the calculation of the amount, ratio or percentage then in
existence) and, to the extent the conditions set forth in Section 8.9 have been satisfied in
respect of any decrease in the interest rate applicable to the Series 2004-1 Notes, a certification
that such conditions have been satisfied, together with a statement setting forth the interest rate
applicable to each Series of the Series 2004-1 Notes and the date from which such interest rate
shall have been applicable (or, in the event that the Company shall be required to make a payment
of additional interest pursuant to Section 8.9(e), setting forth the interest rate which is then in
effect); and



11. Section 8.4 of the Existing Note Agreement is hereby amended and restated in its entirety as
follows:



8.4. Prepayments in Connection with the Certain Events.



(a) If after the First Amendment Effective Date the Company or any of its Subsidiaries shall
receive Section 8.4(a) Net Proceeds from any Section 8.4(a) Proceeds Event, the Company will
promptly give written notice thereof to each holder of a Note, which notice shall (i) refer
specifically to this Section 8.4(a) and describe in reasonable detail the Section 8.4(a) Proceeds
Event giving rise to such offer to prepay Notes, (ii) specify the Relevant Share of such Section
8.4(a) Net Proceeds to be applied to the prepayment of the Notes and the ratable portion thereof to
be prepaid in respect of each Note (determined based on the unpaid principal amount of each Note in
proportion to the aggregate unpaid principal amount of all Notes of all Series at the time
outstanding), (iii) specify a Business Day not less than 30 days and not more than 60 days after
the date of such notice (the “Section 8.4(a) Prepayment Date”) and specify the Section 8.4(a)
Response Date (as defined below) and (iv) offer to prepay on the Section 8.4(a) Prepayment Date
such ratable portion of each Note together with interest accrued thereon to the Section 8.4(a)
Prepayment Date. Each holder of a Note shall notify the Company of such holder’s acceptance or
rejection of such offer by giving written notice of such acceptance or rejection to the Company on
a date at least 10 Business Days prior to the Section 8.4(a) Prepayment Date (such date 10 Business
Days prior to the Section 8.4(a) Prepayment Date being the “Section 8.4(a) Response Date”), and the
Company shall prepay on the Section 8.4(a) Prepayment Date such ratable portion of each Note held
by the holders who have accepted such offer in accordance with this Section 8.4(a) at a price in
respect of each Note held by such holder equal to the principal amount of such ratable portion of
such Note, together with interest accrued thereon to the Section 8.4(a) Prepayment Date;
provided, however, that the failure by a holder of any Note to respond to such
offer in writing on or before the Section 8.4(a) Response Date shall be deemed to be a rejection of
such offer.



(b) If the Company elects to offer to prepay Notes in accordance with Section 10.4A, the
Company will promptly give written notice thereof to each holder of a Note, which notice shall (i)
refer specifically to this Section 8.4(b) and describe in reasonable detail the Section 8.4(b)
Disposition giving rise to such offer to prepay Notes, (ii) specify the Relevant Share of the
Section 8.4(b) Net Proceeds to be applied to the prepayment of the Notes and the ratable portion
thereof to be prepaid in respect of each Note (determined based on the unpaid principal amount of
each Note in proportion to the aggregate unpaid principal amount of all Notes of all Series at the
time outstanding), (iii) specify a Business Day not less than 30 days and not more than 60 days
after the date of such notice (the “Section 8.4(b) Prepayment Date”) and specify the Section 8.4(b)
Response Date (as defined below) and (iv) offer to prepay on the Section 8.4(b) Prepayment Date
such ratable portion of each Note together with interest accrued thereon to the Section 8.4(b)
Prepayment Date. Each holder of a Note shall notify the Company of such holder’s acceptance or
rejection of such offer by giving written notice of such acceptance or rejection to the Company on
a date at least 10 Business Days prior to the Section 8.4(b) Prepayment Date (such date 10 Business
Days prior to the Section 8.4(b) Prepayment Date being the “Section 8.4(b) Response Date”), and the
Company shall prepay on the Section 8.4(b) Prepayment Date such ratable portion of each Note held
by the holders who have accepted such offer in accordance with this Section 8.4(b) at a price in
respect of each Note held by such holder equal to the principal amount of such ratable portion of
such Note, together with interest accrued thereon to the Section 8.4(b) Prepayment Date;
provided, however, that the failure by a holder of any Note to respond to such
offer in writing on or before the Section 8.4(b) Response Date shall be deemed to be a rejection of
such offer.



12. Section 8.7 of the Existing Note Agreement is hereby amended and restated in its entirety to
read as follows:



8.7. Purchase of Notes.



The Company will not and will not permit any Affiliate to purchase, redeem, prepay or
otherwise acquire, directly or indirectly, any of the outstanding Notes except (a) upon the payment
or prepayment of the Notes in accordance with the terms of this Agreement and the Notes or (b) at
any time when the Consolidated Leverage Ratio is equal to or less than 2.50 to 1.00 as of the last
day of the fiscal quarter then most recently ended, pursuant to an offer to purchase made by the
Company or an Affiliate pro rata to the holders of all Notes at the time outstanding upon the same
terms and conditions. Any such offer shall provide each holder with sufficient information to
enable it to make an informed decision with respect to such offer, and shall remain open for at
least 20 Business Days. If the holders of more than 50% of the principal amount of the Notes then
outstanding accept such offer, the Company shall promptly notify the remaining holders of such fact
and the expiration date for the acceptance by holders of Notes of such offer shall be extended by
the number of days necessary to give each such remaining holder at least five Business Days from
its receipt of such notice to accept such offer. The Company will promptly cancel all Notes
acquired by it or any Affiliate pursuant to any payment, prepayment or purchase of Notes pursuant
to any provision of this Agreement and no Notes may be issued in substitution or exchange for any
such Notes.



13. The definition of Remaining Scheduled Payments contained in Section 8.8 of the Existing Note
Agreement is hereby amended and restated in its entirety as follows:



“Remaining Scheduled Payments” means, with respect to the Called Principal of any Series
2004-1 Note, all payments of such Called Principal and interest thereon that would be due after the
Settlement Date with respect to such Called Principal if no payment of such Called Principal were
made prior to its scheduled due date; provided that if such Settlement Date is not a date
on which interest payments are due to be made under the terms of the Series 2004-1 Notes, then the
amount of the next succeeding scheduled interest payment will be reduced by the amount of interest
accrued to such Settlement Date pursuant to Section 8.2 or 12.1; further provided, that in
calculating the Remaining Scheduled Payments in respect of any Series 2004-1 Note, the interest
rate for such Series 2004-1 Note shall be assumed to be (a) 5.23% per annum in respect of each
Series 2004-1 Tranche A Note , (b) 5.75% per annum in respect of each Series 2004-1 Tranche B Note
and (c) 5.85% per annum in respect of each Series 2004-1 Tranche C Note.



14. A new Section 8.9 is hereby added to the Existing Note Agreement immediately following Section
8.8 to read in its entirety as follows:



8.9. Interest on Series 2004-1 Notes.



Notwithstanding anything to the contrary contained herein, interest shall be payable in
respect of the outstanding principal amounts of each of the Series 2004-1 Notes as follows:



(a) Prior to the First Amendment Effective Date, interest on the outstanding principal amount
of each Series 2004-1 Note shall accrue and be payable at the rate per annum of (i) 5.23% in
respect of each Series 2004-1 Tranche A Note, (ii) 5.75% in respect of each Series 2004-1 Tranche B
Note and (iii) 5.85% in respect of each Series 2004-1 Tranche C Note.



(b) Subject to the provisions of Sections 8.9(c) or (d), beginning on and after the First
Amendment Effective Date, interest on the outstanding principal amount of each Series 2004-1 Note
shall accrue and be payable at the rate per annum of (i) 7.66% in respect of each Series 2004-1
Tranche A Note , (ii) 8.14% in respect of each Series 2004-1 Tranche B Note and (iii) 8.46% in
respect of each Series 2004-1 Tranche C Note.



(c) If, as of the last day of each of two consecutive quarterly fiscal periods of the Company
ending after the First Amendment Effective Date, the ratio of (i) Consolidated Total Indebtedness,
determined as of the first and second of such last days, to (ii) Consolidated Actual EBITDA for the
periods of four consecutive quarterly fiscal periods of the Company ending on the first and second
of such last days, respectively, was less than 3.50 to 1.00, then, beginning on the first day of
the quarterly fiscal period of the Company beginning after the end of the second of such
consecutive quarterly fiscal periods, interest on the outstanding principal amount of the Series
2004-1 Notes shall accrue and be payable at the rate per annum of (i) 7.41% in respect of each
Series 2004-1 Tranche A Note, (ii) 7.89% in respect of each Series 2004-1 Tranche B Note and (iii)
8.21% in respect of each Series 2004-1 Tranche C Note; for the avoidance of doubt, the interest
rate applicable to the Series 2004-1 Notes shall not be subject to subsequent increase pursuant to
this Section 8.9, but may subsequently be decreased pursuant to Section 8.9(d).



(d) If, as of the last day of each of two consecutive quarterly fiscal periods of the Company
ending after the First Amendment Effective Date, the ratio of (i) Consolidated Total Indebtedness,
determined as of the first and second of such last days, to (ii) Consolidated Actual EBITDA for the
periods of four consecutive quarterly fiscal periods of the Company ending on the first and second
of such last days, respectively, was less than 3.00 to 1.00, then, beginning on the first day of
the quarterly fiscal period of the Company beginning after the end of the second of such
consecutive quarterly fiscal periods, interest on the outstanding principal amount of the Series
2004-1 Notes shall accrue and be payable at the rate per annum of (i) 6.66% in respect of each
Series 2004-1 Tranche A Note, (ii) 7.14% in respect of each Series 2004-1 Tranche B Note and (iii)
7.46% in respect of each Series 2004-1 Tranche C Note; for the avoidance of doubt, the interest
rate applicable to the Series 2004-1 Notes shall not be subject to any subsequent increase or
decrease pursuant to this Section 8.9, but, subject to the other terms of this Agreement, shall
remain in effect until the applicable maturity date of each Series of Series 2004-1 Notes.



(e) If (i) an interest payment date shall occur after the end of a quarterly fiscal period of
the Company, but prior to the time the Company is required to deliver a certificate of a Senior
Financial Officer pursuant to Section 7.2 in respect of such quarterly fiscal period (or fiscal
year, in the case of the fourth quarterly fiscal period) and (ii) the Company believes, in good
faith, that the conditions set forth in Section 8.9(c) or Section 8.9(d), as applicable, were
satisfied as of the end of such quarterly fiscal period, then the Company may pay interest on such
interest payment date computed taking into account the reduction provided for in the applicable
Section, so long as it shall deliver to each holder of Notes, together with such interest payment,
an Officer’s Certificate specifying in reasonable detail the computation of interest for the period
ending on such interest payment date. If the Company gives effect to such reduction but the
certificate in respect of such quarterly fiscal period (or fiscal year, as the case may be)
delivered pursuant to Section 7.2 shows that such conditions were not satisfied, the Company shall,
together with delivery of such certificate, pay to each holder such additional amount as would have
been paid had such reduction not been given effect and shall set forth in such certificate the
explanation for such payment. If the Company does not give effect to such reduction but the
certificate delivered pursuant to Section 7.2 shows that such conditions were satisfied, the
Company shall reduce the amount of interest payable on the next succeeding interest payment date by
the amount of the reduction that should have been applied to the immediately preceding interest
payment date and the payment of interest on such next succeeding interest payment date shall be
accompanied by an explanation of such reduced payment.



15. Section 9.1 of the Existing Note Agreement is hereby amended by inserting the phrase “Without
limiting Section 10.13,” at the beginning of such sentence (and by replacing the capital “T” with a
lower case “t” in the word “the” immediately following such phrase), and inserting “ERISA, the USA
Patriot Act and” between “without limitation,” and “Environmental Laws” in the third and fourth
lines thereof.



16. Section 9.5 of the Existing Note Agreement is hereby amended and restated in its entirety to
read as follows:



9.5 Corporate Existence, etc.



The Company will at all times preserve and keep in full force and effect its corporate
existence, and, subject to Section 10.3, the Company will at all times preserve and keep in full
force and effect the corporate existence of each of its Subsidiaries and all rights and franchises
of the Company and its Subsidiaries unless, in the good faith judgment of the Company, the
termination of or failure to preserve and keep in full force and effect the corporate existence of
any Subsidiary, or any such right or franchise could not, individually or in the aggregate, have a
Material Adverse Effect.



17. Section 9.6 of the Existing Note Agreement is hereby deleted and a new Section 9.6 is hereby
added in its place to read in its entirety as follows:



9.6 Books and Records.



The Company will, and will cause each of its Subsidiaries to, maintain proper books of record
and account in conformity with GAAP and all applicable requirements of any Governmental Authority
having legal or regulatory jurisdiction over the Company or such Subsidiary, as the case may be.



18. A new Section 9.7 is hereby added to the Existing Note Agreement immediately following new
Section 9.6 to read in its entirety as follows:



9.7 Guarantors and Collateral; Further Assurances.



(a) The Company will take, and will cause each of its Subsidiaries to take, such action from
time to time as shall be necessary to ensure that (i) each Subsidiary is a “Subsidiary Guarantor”
hereunder and (if applicable) a “Loan Party” under the Pledge Agreement (other than any Excluded
Subsidiary, except, in the case of any Domestic Subsidiary that is an Immaterial Subsidiary, to the
extent necessary to comply with clause (ii) of the definition of “Immaterial Subsidiary”) and (ii)
100% of the Capital Stock of each Subsidiary (other than any Excluded Equity Interests) shall be
pledged pursuant to the Pledge Agreement; provided that, in the case of voting Capital Stock of
each First-Tier Foreign Subsidiary (other than any Immaterial Subsidiary, except to the extent
necessary to comply with clause (ii) of the definition of “Immaterial Subsidiary”) not more than
65% of such voting Capital Stock shall be pledged in favor of the Collateral Agent for the benefit
of the Secured Parties pursuant to the Pledge Agreement.



Promptly but in no event later than 45 days (which period may be extended by the Collateral
Agent in its sole discretion) following the formation or acquisition of any Subsidiary after the
First Amendment Effective Date, the Company will, and will cause each of its Subsidiaries to, take
such action to cause (x) such Subsidiary to become a “Subsidiary Guarantor” hereunder by executing
and delivering to the holders of the Notes a Guaranty Joinder Agreement in the form of Annex B to
the Subsidiary Guaranty Agreement and (if applicable) to become a “Loan Party” under the Pledge
Agreement, to the extent required under clause (i) of the immediately preceding paragraph and (y)
the Capital Stock of such Subsidiary, to the extent required under clause (ii) of the immediately
preceding paragraph, to be pledged in favor of the Collateral Agent for the benefit of the Secured
Parties, pursuant to the Pledge Agreement or such other local law pledge, charge or similar
agreement in respect of such Capital Stock as the Collateral Agent shall reasonably request and (z)
such Subsidiary or any other relevant Obligor to deliver such proof of corporate action, incumbency
of officers, opinions of counsel and other documents as is consistent with those delivered by the
Obligors pursuant to the First Amendment on the First Amendment Effective Date as the Collateral
Agent shall reasonably request.



(b) The Company will, and will cause each of its Subsidiaries to, take such action from time
to time as shall reasonably be requested by the Required Holders or the Collateral Agent to
effectuate the purposes and objectives of this Agreement. Without limiting the foregoing, in the
event that any additional Capital Stock shall be issued by any Subsidiary, subject to Section
9.7(a), the Company agrees forthwith to or to cause such Subsidiary to deliver to the Collateral
Agent pursuant to the Pledge Agreement the certificates evidencing such Capital Stock, accompanied
by undated stock powers executed in blank and to take such other action as the Collateral Agent
shall request to perfect the security interest created therein pursuant to the Pledge Agreement.



19. Section 10 of the Existing Note Agreement is hereby amended and restated in its entirety to
read as follows:



10. NEGATIVE COVENANTS.



	 	 	 
	The Company covenants that so long as any of the Notes are outstanding:

	10.1

	 	Indebtedness.






The Company will not, and will not permit any of its Subsidiaries to, create, incur, assume or
permit to exist any Indebtedness, except:




(a) Indebtedness outstanding on the First Amendment Effective Date and listed in
Schedule 5.15 to the First Amendment (including the Other Senior Notes and any
Guarantees thereof by the Subsidiary Guarantors) and extensions, renewals and replacements
of any such Indebtedness that do not increase the outstanding principal amount thereof;




(b) In addition to the Indebtedness outstanding on the First Amendment Effective Date
and listed in Schedule 5.15, (i) Indebtedness of any Obligor owing to any other
Obligor or to any Subsidiary that is not an Obligor and (ii) Indebtedness of any Subsidiary
that is not an Obligor owing to the Company or any Subsidiary; provided that, if the
Consolidated Leverage Ratio (calculated as of the most recently ended fiscal quarter of the
Company) shall be greater than 3.50 to 1.00, the aggregate principal amount of Indebtedness
owing to the Obligors under clause (ii) above, together with the aggregate amount of
Investments by the Obligors in Subsidiaries that are not Obligors under Section 10.5(c)(ii),
shall not exceed $75,000,000 at any time outstanding;




(c) Indebtedness or other obligations of the Company or any Subsidiary under letters of
credit and surety or other bonds incurred in the ordinary course of business of the Company
or such Subsidiary in an aggregate principal amount not to exceed $30,000,000 at any time
outstanding;




(d) Indebtedness (including Capital Lease Obligations) secured by Liens permitted under
Section 10.2(d) in an aggregate principal amount not to exceed $20,000,000 at any time
outstanding;




(e) Indebtedness of any Person that becomes a Subsidiary after the First Amendment
Effective Date; provided that such Indebtedness exists at the time such Person
becomes a Subsidiary and is not created in contemplation of or in connection with such
Person becoming a Subsidiary;




(f) Indebtedness of the Obligors created hereunder and under the other Financing
Documents:




(g) Indebtedness secured by Liens permitted under Section 10.2(e);




(h) Indebtedness outstanding under the Bank Credit Agreement (and any Guarantees
thereof by the Subsidiary Guarantors) in an aggregate principal amount not to exceed
$2,000,000,000 at any time outstanding;




(i) Indebtedness in respect of a convertible notes offering; provided that (i) such
Indebtedness does not provide for any scheduled repayment, mandatory redemption or sinking
fund obligation prior to six months after the scheduled maturity date of the Series 2004-1
Tranche C Notes and (ii) such Indebtedness is unsecured and subordinated, pursuant to
subordination provisions in form and substance reasonably satisfactory to the Required
Holders, in right of payment to the Notes; and




(j) other Indebtedness in an aggregate principal amount not to exceed 25% of
Consolidated Net Worth at any time outstanding;



provided, however, that, notwithstanding the foregoing, no Subsidiary shall, at any time after it
has been released from its obligations under the Subsidiary Guaranty Agreement (as contemplated by
the Intercreditor Agreement), Guarantee any Indebtedness outstanding under the Bank Credit
Agreement or any other Primary Credit Agreement unless (x) it shall simultaneously Guarantee the
Notes on the same terms and (y) the creditors under the Bank Credit Agreement, or such other
Primary Credit Agreement, shall have entered into an intercreditor agreement with the holders of
the Notes, in form and substance reasonably satisfactory to the Required Holders.



10.2 Liens.



The Company will not, and will not permit any of its Subsidiaries to, create, incur, assume or
permit to exist any Lien on any property or asset now owned or hereafter acquired by it, or assign
or sell any income or revenues (including accounts receivable) or rights in respect of any thereof,
except:




(a) Permitted Encumbrances;




(b) any Lien on any property or asset of the Company or any of its Subsidiaries
existing on the First Amendment Effective Date and listed on Schedule 5.15 to the
First Amendment, provided that any such Lien shall secure only those obligations
which it secures on the First Amendment Effective Date and any extensions, renewals and
replacements thereof shall not increase the outstanding principal amount thereof;




(c) any Lien existing on any property or asset prior to the acquisition thereof by the
Company or any Subsidiary or existing on any property or asset of any Person that becomes a
Subsidiary after the First Amendment Effective Date prior to the time such Person becomes a
Subsidiary, and extensions, renewals and replacements thereof that do not increase the
outstanding principal amount thereof; provided that (i) such Lien is not created in
contemplation of or in connection with such acquisition or such Person becoming a
Subsidiary, as the case may be, (ii) no such Lien shall extend to any other property or
assets of the Company or any Subsidiary and (iii) such Lien shall secure only those
obligations which it secures on the date of such acquisition or the date such Person becomes
a Subsidiary, as the case may be;




(d) Liens securing Indebtedness of the Company or any Subsidiary incurred pursuant to
Section 10.1(d) to finance the acquisition, construction or improvement of fixed or capital
assets; provided that (i) such Liens and the Indebtedness secured thereby are
incurred prior to or within 90 days after such acquisition or the completion of such
construction or improvement and (ii) no such Lien shall extend to any property or assets of
the Company or any Subsidiary other than the property financed by such Indebtedness;




(e) Liens covering accounts receivable and related rights of the Company, its
Subsidiaries and any special purpose entity issuing Indebtedness under a securitization
transaction or program with respect to such accounts receivable and related rights (a
“Receivables Securitization Program”), provided that (i) the Indebtedness of such
special purpose entity is recourse only to its assets (and not to the assets of the Company
or any Subsidiary other than such special purpose entity), (ii) the aggregate principal
amount of such Indebtedness shall not exceed $125,000,000 at any time outstanding and (iii)
no such Lien shall extend to any other property of the Company and its Subsidiaries;




(f) Liens created pursuant to the Pledge Agreement; and




(g) Liens incurred by the Company or any Subsidiary, in addition to Liens incurred
under the foregoing clauses (a) through (f) of this Section, provided that neither
(i) the aggregate outstanding principal amount of the obligations secured thereby nor
(ii) the aggregate fair market value (determined as of the date such Lien is incurred) of
the assets subject thereto shall exceed (as to the Company and all Subsidiaries) $30,000,000
at any time outstanding;



provided, however, that, notwithstanding the foregoing, the Company shall not, and shall not permit
any Subsidiary to, grant or otherwise permit to exist a Lien on its property securing any
Indebtedness outstanding under the Bank Credit Agreement or any other Primary Credit Agreement at
any time after the release of any property of such Person from the Lien of the Pledge Agreement
unless (x) such Person shall simultaneously grant, on the same terms, a Lien on such property
securing the Notes equally and ratably with such other Indebtedness and (y) the creditors under the
Bank Credit Agreement, or such other Primary Credit Agreement, shall have entered into an
intercreditor agreement with the holders of the Notes, in form and substance reasonably
satisfactory to the Required Holders.



10.3 Fundamental Changes.



The Company will not, and will not permit any of its Subsidiaries to, enter into any
transaction of merger or consolidation or amalgamation, or liquidate, wind up or dissolve itself
(or suffer any liquidation or dissolution), or Dispose of all or substantially all of its property
or business, except:



(a) any Subsidiary of the Company may be merged or consolidated with or into the Company
(provided that the Company shall be the continuing or surviving entity) or with or into any
other Subsidiary;



(b) any Subsidiary of the Company may Dispose of any or all of its assets (i) to the Company
or any other Subsidiary (upon voluntary liquidation or otherwise) or (ii) pursuant to a Disposition
permitted by Section 10.4 or Section 10.4A;



(c) any acquisition expressly permitted under Section 10.5 may be structured as a merger,
consolidation or amalgamation; and



(d) any Subsidiary may liquidate or dissolve if the Company determines in good faith that such
liquidation or dissolution is in the best interests of the Company and is not materially
disadvantageous to the holders of the Notes.



10.4 Dispositions of Property.



At any time that the Consolidated Leverage Ratio shall be greater than 3.50 to 1.00
(calculated as of the most recently ended fiscal quarter of the Company at the time of any
Disposition), the Company will not, and will not permit any of its Subsidiaries to, Dispose of any
property, whether now owned or, in the case of any Subsidiary, issue or sell any shares of such
Subsidiary’s Capital Stock to any Person, except:



(a) Dispositions in the ordinary course of business of the Company and its Subsidiaries
(including Dispositions of obsolete or worn-out property no longer required or useful in the
business or operations of the Company or any of its Subsidiaries);



(b) Dispositions permitted by Sections 10.3(b)(i) or (d);



(c) the sale or issuance of Capital Stock of any Subsidiary to the Company or any other
Subsidiary;



(d) Dispositions with respect to the Receivables Securitization Program, provided that
the aggregate principal amount of Indebtedness related to any such Receivables Securitization
Program shall not exceed $125,000,000 at any time outstanding;



(e) Dispositions of property or assets by the Company or any Subsidiary to the extent that, as
part of the same transaction or a series of related transactions, such property or assets are
within 365 days after the date of such Disposition leased by the Company or such Subsidiary as
lessee for use in the business of the Company and its Subsidiaries, provided that the
aggregate amount of all such Dispositions shall not exceed $75,000,000; or



(f) Dispositions of property for fair market value not covered by the foregoing clauses (a)
through (e) of this Section.



10.4A Original Asset Disposition Covenant.



At any time that the Consolidated Leverage Ratio shall be less than or equal to 3.50 to 1.00
(calculated as of end of the most recently ended fiscal quarter of the Company at the time of any
Disposition), the Company will not, and will not permit any Subsidiary to, Dispose of any of its
properties or assets, except:




(a) Dispositions in the ordinary course of business of the Company and its Subsidiaries
(including Dispositions of obsolete or worn-out property no longer required or useful in the
business or operations of the Company or any of its Subsidiaries);




(b) Dispositions permitted by Sections 10.3(b)(i) or (d);




(c) the sale or issuance of Capital Stock of any Subsidiary to the Company or any other
Subsidiary;




(d) Dispositions with respect to the Receivables Securitization Program,
provided that the aggregate principal amount of Indebtedness related to any such
Receivables Securitization Program shall not exceed $125,000,000 at any time outstanding;




(e) any Dispositions not covered by Subsections (a) through (d) above, inclusive,
provided that such Dispositions are for fair market value and either (i) the aggregate book
value of the properties and assets subject to all such Dispositions pursuant to this clause
(i) of this Subsection (e) during any fiscal year of the Company does not exceed 15% of
Consolidated Total Assets as at the end of the immediately preceding fiscal year of the
Company or (ii) within 365 days after any such Disposition, the Section 8.4(b) Net Proceeds
are used (x) to purchase productive assets for use by the Company or any Subsidiary in their
business or (y) to prepay or repay the Term Loans, the Notes and the Other Senior Notes,
provided that, in connection with any such repayment of such Indebtedness, the Company
shall, in accordance with Section 8.4(b), offer to prepay the Notes pro rata with all other
such Indebtedness then being repaid.



For purposes of this Section 10.4A, (i) any Disposition of shares of stock of any Subsidiary shall
be valued at an amount that bears the same proportion to the total assets of such Subsidiary as the
number of such shares bears to the total number of shares of stock of such Subsidiary and (ii) if
any Subsidiary issues shares and the Company or another Subsidiary does not, directly or
indirectly, acquire all of such shares or a ratable portion of such shares according to the Company
or such other Subsidiary’s ownership percentage with respect to such Subsidiary immediately prior
to such share issuance, as the case may be, such shares not so acquired shall be deemed to be the
subject of a Disposition.



10.5 Investments and Acquisitions.



The Company will not, and will not permit any of its Subsidiaries to, make or suffer to exist
any Investment in any Person or make any Acquisition, except:



(a) Cash Equivalents;



(b) Investments (other than Investments permitted under clause (a) of this Section) existing
on the First Amendment Effective Date and set forth on Schedule 5.4 to the First Amendment
and Investments in Immaterial Subsidiaries existing as of the First Amendment Effective Date;



(c) (i) Investments by any Obligor in any other Obligor; and (ii) Investments by the Company
or any Subsidiary in any Subsidiary that is not an Obligor; provided that, if the
Consolidated Leverage Ratio (calculated as of the most recently ended fiscal quarter of the
Company) shall be greater than 3.50 to 1.00, the aggregate amount of Investments by the Obligors in
Subsidiaries that are not Obligors under clause (ii) above, together with the aggregate principal
amount of Indebtedness owing to the Obligors incurred under Section 10.1(b)(ii), shall not exceed
$75,000,000 at any time outstanding;



(d) Indebtedness permitted by Section 10.1;



(e) purchases of inventory and other property to be sold or used in the ordinary course of
business;



(f) the Arrow Acquisition;



(g) Swap Agreements permitted by Section 10.11;



(h) any Acquisition after the First Amendment Effective Date by the Company or any Subsidiary;
provided that (i) in the case of any such Acquisition, (x) if the Acquired Entity is a
publicly held corporation, such Acquisition shall have been approved by the board of directors of
such Acquired Entity; (y) after giving effect to any such Acquisition of Capital Stock, the
Acquired Entity becomes a direct or indirect Subsidiary of the Company; and (z) the Acquired Entity
is engaged in a line of business in accordance with the requirements of Section 10.10; (ii) both
immediately prior to such Acquisition and after giving effect thereto, no Default shall have
occurred and be continuing; and (iii) if, after giving effect to such Acquisition on a pro forma
basis as if such Acquisition had occurred on the first day of the most recent period of four
consecutive fiscal quarters of the Company, the Consolidated Leverage Ratio shall be greater than
3.50 to 1.00, the aggregate consideration (including assumed Indebtedness, but excluding
consideration in the form of the Capital Stock of the Company) for all such Acquisitions shall not
exceed $150,000,000 in any fiscal year; and



(i) other Investments in an aggregate amount (valued at cost) not exceeding $25,000,000.



10.6 Restricted Payments.



The Company will not, and will not permit any of its Subsidiaries to, declare or make, or
agree to pay or make, directly or indirectly, any Restricted Payment, except that:



(a) the Company may declare and pay dividends with respect to its Capital Stock payable solely
in additional shares of its Capital Stock; and



(b) the Company may make Restricted Payments after the First Amendment Effective Date;
provided that (i) at the time of such Restricted Payment and immediately after giving
effect thereto, no Default shall have occurred and be continuing; and (ii) if, after giving effect
to such Restricted Payment, the Consolidated Leverage Ratio (calculated on a pro forma basis) shall
be greater than 3.50 to 1.00, the aggregate amount of all such Restricted Payments shall not exceed
$75,000,000 in any fiscal year;



provided that nothing herein shall be deemed to prohibit (x) the payment of dividends by
any Subsidiary of the Company to the Company or any other Subsidiary of the Company or, if
applicable, any minority shareholder of such Subsidiary (in accordance with the percentage of the
Capital Stock of such Subsidiary owned by such minority shareholder) or (y) repurchases of Capital
Stock deemed to occur as a result of the surrender of such Capital Stock for cancellation in
connection with the exercise of stock options or warrants.



10.7 Transactions with Affiliates.



The Company will not, and will not permit any of its Subsidiaries to, sell, lease or otherwise
transfer any property or assets to, or purchase, lease or otherwise acquire any property or assets
from, or otherwise engage in any other transactions with, any of its Affiliates, except:



(a) transactions at prices and on terms and conditions not less favorable to the Company or
such Subsidiary than could be obtained on an arm’s-length basis from a Person that is not an
Affiliate;



(b) transactions between or among the Company and its Subsidiaries not involving any other
Affiliate;



(c) any Indebtedness permitted by Section 10.1;



(d) any Investment permitted by Section 10.5;



(e) any Restricted Payment permitted by Section 10.6; and



(f) any Affiliate who is a natural person may serve as an employee or director of the Company
and receive reasonable compensation for his services in such capacity.



10.8 Restrictive Agreements.



The Company will not, and will not permit any of its Subsidiaries to, directly or indirectly,
enter into, incur or permit to exist any agreement or other arrangement that prohibits, restricts
or imposes any condition upon (a) the ability of the Company or any Subsidiary to create, incur or
permit to exist any Lien upon any of its property or assets or (b) the ability of any Subsidiary to
pay dividends or other distributions with respect to any shares of its Capital Stock or to make or
repay loans or advances to the Company or any other Subsidiary or to Guarantee Indebtedness of the
Company or any other Subsidiary or to transfer any property to the Company or any other Subsidiary,
except:



(i) restrictions and conditions imposed by law or by this Agreement or the Other Senior Note
Agreements;



(ii) restrictions and conditions imposed by law or by the Bank Credit Agreement;



(iii) restrictions and conditions existing on the First Amendment Effective Date identified on
Schedule 5.15 to the First Amendment and any extension or renewal thereof, or any amendment
or modification thereof, that, in each case does not expand the scope of any such restriction or
condition;



(iv) customary restrictions and conditions contained in agreements relating to the sale of a
Subsidiary pending such sale (provided that such restrictions and conditions apply only to
the Subsidiary that is to be sold and such sale is permitted hereunder);



(v) (with respect to clause (a) above) (x) restrictions or conditions imposed by any agreement
relating to secured Indebtedness permitted by this Agreement if such restrictions or conditions
apply only to the property or assets securing such Indebtedness and (y) customary provisions in
leases and other contracts restricting the assignment thereof; and



(vi) (with respect to clause (a) above) provisions in any lease or lease agreement, or any
restrictions or conditions imposed by any landlord, prohibiting or restricting the granting,
creation or incurrence of any Liens on any premises leased by the Company or any of its
Subsidiaries.



10.9 Certain Financial Covenants.



(a) Leverage Ratio. The Company will not permit the Consolidated Leverage Ratio, as
at the last day of any period of four consecutive fiscal quarters of the Company ending on or
nearest to the date set forth below, to exceed the ratio set forth below opposite such date:



	 	 	 
	Fiscal Quarter Ending

	 	

	 

	 	

	on or nearest to

	 	Consolidated Leverage Ratio
	 

	 	 
	September 30, 2007

	 	4.75 to 1.00
	December 31, 2007

	 	4.75 to 1.0
	March 31, 2008

	 	4.75 to 1.0
	June 30, 2008

	 	4.75 to 1.0
	September 30, 2008

	 	4.75 to 1.0
	December 31, 2008

	 	4.00 to 1.0
	March 31, 2009

	 	4.00 to 1.0
	June 30, 2009

	 	4.00 to 1.0
	September 30, 2009 and

at all times thereafter

	 	

3.50 to 1.0






(b) Interest Coverage Ratio. The Company will not permit the Consolidated Interest
Coverage Ratio for any period of four consecutive fiscal quarters of the Company ending on or
nearest to the date set forth below to be less than the ratio set forth below opposite such date:



	 	 	 	 	 
	
 
	 	Fiscal Quarter Ending
	 	

	
 
	 	 
	 	

	
 
	 	on or nearest to
	 	Consolidated Interest Coverage Ratio
	
 
	 	 
	 	 
	
 
	 	September 30, 2007
	 	3.00 to 1.00
	
 
	 	December 31, 2007
	 	3.00 to 1.0
	
 
	 	March 31, 2008
	 	3.00 to 1.0
	
 
	 	June 30, 2008
	 	3.00 to 1.0
	
 
	 	September 30, 2008
	 	3.00 to 1.0
	10.10

	 	December 31, 2008 and

at all time thereafter

Lines of Business.
	 	

3.50 to 1.0









The Company will not, and will not permit any of its Subsidiaries to, engage in any business
if, as a result, the general nature of the business in which the Company and its Subsidiaries taken
as a whole would then be engaged would be substantially changed from the general nature of the
business in which the Company and its Subsidiaries taken as a whole are engaged on the First
Amendment Effective Date.



10.11 Swap Agreements.



The Company will not, and will not permit any of its Subsidiaries to, enter into any Swap
Agreement, other than Swap Agreements entered into with any of the Bank Lenders (or any Affiliates
thereof) or in the ordinary course of business to hedge or mitigate risks to which the Company or
any Subsidiary is exposed in the conduct of its business or the management of its liabilities.



10.12 Modification of Bank Credit Agreement.



The Company will not, and will not permit any of its Subsidiaries to, consent to any
modification, supplement or waiver of any of the provisions of the Bank Credit Agreement that could
reasonably be expected to be materially adverse to the interests of the holders of Notes, in each
case, without the prior consent of the Required Holders.



10.13 Terrorism Sanctions Regulations.



The Company will not, and will not permit any of its Subsidiaries to, (a) become a Person
described or designated in the Specially Designated Nationals and Blocked Persons List of the
Office of Foreign Assets Control or in Section 1 of the Anti-Terrorism Order or (b) engage in any
dealings or transaction with any such Person.



20. Section 11 of the Existing Note Agreement is hereby amended and restated in its entirety to
read as follows:



11. EVENTS OF DEFAULT.



An “Event of Default” shall exist if any of the following conditions or events shall occur and
be continuing:



(a) the Company defaults in the payment of any principal or Make-Whole Amount, if any, on any
Note when the same becomes due and payable, whether at maturity or at a date fixed for prepayment
or by declaration or otherwise; or



(b) the Company defaults in the payment of any interest on any Note for more than three
Business Days after the same becomes due and payable; or



(c) the Company defaults in the performance of or compliance with any term contained in
Section 7.1(e), Section 7.1(i), Section 9.1 (with respect to the Company’s existence) or
Sections 10.1 through 10.12 (inclusive); or



(d) the Company defaults in the performance of or compliance with any term contained herein or
in any other Financing Document (other than those referred to in paragraphs (a), (b) and (c) of
this Section 11) and such default is not remedied within 30 days after the Company has received
written notice of such default from any holder of a Note (any such written notice to be identified
as a “notice of default” and to refer specifically to this paragraph (d) of Section 11); or



(e) any representation or warranty made in writing by or on behalf of the Company or by any
officer of the Company in this Agreement or any other Financing Document or in any writing
furnished in connection with the transactions contemplated hereby or thereby proves to have been
false or incorrect in any material respect on the date as of which made; or



(f) (i) the Company or any Subsidiary is in default (as principal or as guarantor or other
surety) in the payment of any principal of or premium or make-whole amount or interest on any
Material Indebtedness beyond any period of grace provided with respect thereto, or (ii) the Company
or any Subsidiary is in default in the performance of or compliance with any term of any evidence
of any Material Indebtedness or of any mortgage, indenture or other agreement relating thereto or
any other condition exists, and as a consequence of such default or condition such Material
Indebtedness has become, or has been declared (or one or more Persons are entitled to declare such
Material Indebtedness to be), due and payable before its stated maturity or before its regularly
scheduled dates of payment, or (iii) as a consequence of the occurrence or continuation of any
event or condition (other than the passage of time or the right of the holder of Material
Indebtedness to convert such Indebtedness into Capital Stock), (x) the Company or any Subsidiary
has become obligated to purchase or repay Material Indebtedness before its regular maturity or
before its regularly scheduled dates of payment or (y) one or more Persons have the right to
require the Company or any Subsidiary so to purchase or repay any Material Indebtedness ; or



(g) the Company or any Subsidiary (other than an Immaterial Subsidiary) (i) is generally not
paying, or admits in writing its inability to pay, its debts as they become due, (ii) files, or
consents by answer or otherwise to the filing against it of, a petition for relief or
reorganization or arrangement or any other petition in bankruptcy, for liquidation or to take
advantage of any bankruptcy, insolvency, reorganization, moratorium or other similar law of any
jurisdiction, (iii) makes an assignment for the benefit of its creditors, (iv) consents to the
appointment of a custodian, receiver, trustee or other officer with similar powers with respect to
it or with respect to any substantial part of its property, (v) is adjudicated as insolvent or to
be liquidated, or (vi) takes corporate action for the purpose of any of the foregoing; or



(h) a court or governmental authority of competent jurisdiction enters an order appointing,
without consent by the Company or any Subsidiary (other than an Immaterial Subsidiary), a
custodian, receiver, trustee or other officer with similar powers with respect to it or with
respect to any substantial part of its property, or constituting an order for relief or approving a
petition for relief or reorganization or any other petition in bankruptcy or for liquidation or to
take advantage of any bankruptcy or insolvency law of any jurisdiction, or ordering the
dissolution, winding-up or liquidation of the Company or any Subsidiary (other than an Immaterial
Subsidiary), or any such petition shall be filed against the Company or any Subsidiary (other than
an Immaterial Subsidiary) and such petition shall not be dismissed within 60 days; or



(i) a final judgment or judgments for the payment of money aggregating in excess of
$35,000,000 are rendered against one or more of the Company and its Subsidiaries and which
judgments are not, within 30 days after entry thereof, bonded, discharged or stayed pending appeal,
or are not discharged within 30 days after the expiration of such stay; or



(j) if (i) any Plan shall fail to satisfy the minimum funding standards of ERISA or the Code
for any plan year or part thereof or a waiver of such standards or extension of any amortization
period is sought or granted under section 412 of the Code, (ii) a notice of intent to terminate any
Plan shall have been or is reasonably expected to be filed with the PBGC or the PBGC shall have
instituted proceedings under ERISA section 4042 to terminate or appoint a trustee to administer any
Plan or the PBGC shall have notified the Company or any ERISA Affiliate that a Plan may become a
subject of any such proceedings, (iii) the existence with respect to any Plan of an “accumulated
funding deficiency” (as defined in section 412 of the Code or section 302 of ERISA), whether or not
waived, (iv) the Company or any ERISA Affiliate shall have incurred or is reasonably expected to
incur any liability pursuant to Title I or IV of ERISA or the penalty or excise tax provisions of
the Code relating to employee benefit plans, (v) the Company or any ERISA Affiliate withdraws from
any Multiemployer Plan, or (vi) the Company or any Subsidiary establishes or amends any employee
welfare benefit plan that provides post-employment welfare benefits in a manner that would increase
the liability of the Company or any Subsidiary thereunder; and any such event or events described
in clauses (i) through (vi) above, either individually or together with any other such event or
events, could reasonably be expected to have a Material Adverse Effect; or



(k) the Liens created by the Pledge Agreement or the Intercreditor Agreement shall at any time
not constitute a valid and perfected Lien on the collateral intended to be covered thereby in favor
of the Collateral Agent, free and clear of all other Liens (other than Liens permitted under
Section 10.2 or under either such agreement), except to the extent such loss of perfection or
priority results from the failure of the Collateral Agent to maintain possession of certificates
actually delivered to it representing securities pledged under the Pledge Agreement or to file
Uniform Commercial Code continuation statements, or, except for expiration in accordance with its
terms, any of the Financing Documents shall for any reason be terminated or cease to be in full
force and effect or to be valid and binding on any of the Obligors party thereto, or the
enforceability thereof shall be contested by any Obligor.



As used in Section 11(j), the terms “employee benefit plan” and “employee welfare benefit plan”
shall have the respective meanings assigned to such terms in section 3 of ERISA.



21. Sections 15, 16 and 17 of the Existing Note Agreement are hereby amended and restated in their
entireties to read as follows:



15. EXPENSES, ETC.



15.1. Transaction Expenses.



Whether or not the transactions contemplated hereby are consummated, the Company will pay all
reasonable costs and expenses (including reasonable attorneys’ fees of a special counsel and, if
reasonably required by the Required Holders, local or other counsel) incurred by the Purchasers and
each other holder of a Note in connection with such transactions and in connection with any
amendments, waivers or consents under or in respect of this Agreement, the Notes or the other
Financing Documents (whether or not such amendment, waiver or consent becomes effective),
including, without limitation: (a) the reasonable costs and expenses incurred in enforcing or
defending (or determining whether or how to enforce or defend) any rights under this Agreement, the
Notes or the other Financing Documents or in responding to any subpoena or other legal process or
informal investigative demand issued in connection with this Agreement, the Notes or the other
Financing Documents, or by reason of being a holder of any Note and (b) the reasonable costs and
expenses, including financial advisors’ fees, incurred in connection with the insolvency or
bankruptcy of the Company or any Subsidiary or in connection with any work-out or restructuring of
the transactions contemplated hereby, by the Notes and by the other Financing Documents. The
Company will pay, and will save each Purchaser and each other holder of a Note harmless from, all
claims in respect of any fees, costs or expenses if any, of brokers and finders (other than those
retained by such Purchaser or other holder in connection with its purchase of the Notes).



15.2. Survival.



The obligations of the Company under this Section 15 will survive the payment or transfer of
any Note, the enforcement, amendment or waiver of any provision of this Agreement, the Notes or the
other Financing Documents, and the termination of this Agreement.



16. SURVIVAL OF REPRESENTATIONS AND WARRANTIES; ENTIRE AGREEMENT.



All representations and warranties contained herein or in the other Financing Documents shall
survive the execution and delivery of this Agreement and the Notes, the purchase or transfer by
each Purchaser of any Note or portion thereof or interest therein and the payment of any Note, and
may be relied upon by any subsequent holder of a Note, regardless of any investigation made at any
time by or on behalf of any Purchaser or any other holder of a Note. All statements contained in
any certificate or other instrument delivered by or on behalf of the Company pursuant to this
Agreement or the other Financing Documents shall be deemed representations and warranties of the
Company under this Agreement. Subject to the preceding sentence, this Agreement, the Notes and the
other Financing Documents embody the entire agreement and understanding between the Purchasers and
the Company and supersede all prior agreements and understandings relating to the subject matter
hereof.



17. AMENDMENT AND WAIVER.



17.1 Requirements.



This Agreement and the Notes may be amended, and the observance of any term hereof or of the
Notes may be waived (either retroactively or prospectively), with (and only with) the written
consent of the Company and the Required Holders, except that (a) no amendment or waiver of any of
the provisions of Section 1, 2, 3, 4, 5, 6 or 21 hereof, or any defined term (as it is used
therein), will be effective as to any Purchaser unless consented to by such Purchaser in writing,
and (b) no such amendment or waiver may, without the written consent of the holder of each Note at
the time outstanding affected thereby, (i) subject to the provisions of Section 12 relating to
acceleration or rescission, change the amount or time of any prepayment or payment of principal of,
or reduce the rate or change the time of payment or method of computation of interest or of the
Make-Whole Amount on, the Notes, (ii) change the percentage of the principal amount of the Notes
the holders of which are required to consent to any such amendment or waiver, or (iii) amend any of
Sections 8, 11(a), 11(b), 12, 17 or 20.



17.2. Solicitation of Holders of Notes.



(a) Solicitation. The Company will provide each holder of the Notes (irrespective of
the amount of Notes then owned by it) with sufficient information, sufficiently far in advance of
the date a decision is required, to enable such holder to make an informed and considered decision
with respect to any proposed amendment, waiver or consent in respect of any of the provisions
hereof or of the Notes or any other Financing Documents. The Company will deliver executed or true
and correct copies of each amendment, waiver or consent effected pursuant to the provisions of this
Section 17 to each holder of outstanding Notes promptly following the date on which it is executed
and delivered by, or receives the consent or approval of, the requisite holders of Notes.



(b) Payment. The Company will not directly or indirectly pay or cause to be paid any
remuneration, whether by way of supplemental or additional interest, fee or otherwise, or grant any
security or provide other credit support, to any holder of Notes as consideration for or as an
inducement to the entering into by any holder of Notes of any waiver or amendment of any of the
terms and provisions hereof or of any other Financing Documents, or the release of any Subsidiary
Guarantor from the Subsidiary Guaranty Agreement or any collateral subject to the Lien of the
Pledge Agreement, unless such remuneration is concurrently paid, or security is concurrently
granted or other credit support concurrently provided, on the same terms, ratably to each holder of
Notes then outstanding even if such holder did not consent to such waiver, amendment or release.



(c) Consent in Contemplation of Transfer. Any consent made pursuant to this Section
17 by a holder of Notes that has transferred or has agreed to transfer its Notes to the Company,
any Subsidiary or any Affiliate of the Company and has provided or has agreed to provide such
written consent as a condition to such transfer shall be void and of no force or effect except
solely as to such holder, and any amendments effected or waivers granted or to be effected or
granted that would not have been or would not be so effected or granted but for such consent (and
the consents of all other holders of Notes that were acquired under the same or similar conditions)
shall be void and of no force or effect except solely as to such holder.



17.3 Binding Effect, etc.



Any amendment or waiver consented to as provided in this Section 17 applies equally to all
holders of Notes and is binding upon them and upon each future holder of any Note and upon the
Company without regard to whether such Note has been marked to indicate such amendment or waiver.
No such amendment or waiver will extend to or affect any obligation, covenant, agreement, Default
or Event of Default not expressly amended or waived or impair any right consequent thereon. No
course of dealing between the Company and the holder of any Note nor any delay in exercising any
rights hereunder or under any Note or other Financing Document shall operate as a waiver of any
rights of any holder of such Note. As used herein, the term “this Agreement” and references
thereto shall mean this Agreement as it may from time to time be amended or supplemented.



17.4 Notes held by Company, etc.



Solely for the purpose of determining whether the holders of the requisite percentage of the
aggregate principal amount of Notes then outstanding approved or consented to any amendment, waiver
or consent to be given under this Agreement, the Notes or any other Financing Document, or have
directed the taking of any action provided herein, or in the Notes or in any other Financing
Document to be taken upon the direction of the holders of a specified percentage of the aggregate
principal amount of Notes then outstanding, Notes directly or indirectly owned by the Company or
any of its Affiliates shall be deemed not to be outstanding.



17.5 Release of Collateral and Subsidiary Guaranty Agreement.



Notwithstanding anything herein to the contrary, upon any Disposition of property constituting
Collateral (as that term is defined in the Pledge Agreement) including the Capital Stock of any
Subsidiary that is a Subsidiary Guarantor, which Disposition is permitted pursuant to Section 10.4
or Section 10.4A of this Agreement, as applicable, such Subsidiary Guarantor shall be automatically
released from any obligation arising pursuant to the Subsidiary Guaranty Agreement and any security
interest granted in favor of the holders hereunder or under the Pledge Agreement shall be
automatically terminated, in each case, without notice or further action by the Company or any
holder so long as equivalent action is simultaneously taken by the Bank Lenders, or the
Administrative Agent (as defined in the Bank Credit Agreement) or the Collateral Agent on their
behalf, pursuant to the Bank Loan Documents.



22. Section 20 of the Existing Note Agreement is hereby amended by replacing the phrase “such
Purchaser’s Notes or this Agreement” with “the Financing Documents” in the twelfth line from the
bottom of such Section.



23. Each reference to the term “Restricted Subsidiary”, “Restricted Subsidiaries”, “Unrestricted
Subsidiary” and “Unrestricted Subsidiaries” in the Existing Note Agreement is hereby replaced with
a reference to “Subsidiary” or “Subsidiaries”, as applicable, and each reference to the term
“Guaranty” in the Existing Note Agreement is hereby replaced with a reference to the term
“Guarantee”.



5




EXHIBIT E




Schedule B




DEFINED TERMS




As used herein, the following terms have the respective meanings set forth below or set forth
in the Section hereof following such term:



“Acquired Entity” means any business, assets or Person subject to an Acquisition.



“Acquisition” means any transaction, or any series of related transactions, consummated after
the First Amendment Effective Date, by which the Company and/or any of its Subsidiaries
(a) acquires any going business or all or substantially all of the assets of any corporation,
limited liability company, partnership, joint venture or other entity or any division of any
corporation, limited liability company, partnership, joint venture or other entity or the right to
use or manage or otherwise exploit any such business or assets, whether through purchase or lease
of assets, merger or otherwise or (b) directly or indirectly acquires ownership or Control of at
least a majority (in number of votes) of Capital Stock which has ordinary voting power for the
election of directors or other managers of any corporation, limited liability company, partnership,
joint venture or other entity.



“Affiliate” means, with respect to a specified Person, another Person that directly, or
indirectly through one or more intermediaries, Controls or is Controlled by or is under common
Control with the Person specified. Unless the context otherwise clearly requires, any reference to
an “Affiliate” is a reference to an Affiliate of the Company.



“Agreement” is defined in Section 17.3.



“Anti-Terrorism Order” means Executive Order No. 13,224 of September 23, 2001, Blocking
Property and Prohibiting Transactions with Persons Who Commit, Threaten to Commit or Support
Terrorism, 66 U.S. Fed. Reg. 49079 (2001), as amended.



“Arrow” means Arrow International, Inc., a Pennsylvania corporation.



“Arrow Acquisition” means the acquisition of Arrow, by merger of Arrow with and into Merger
Subsidiary (with Arrow as the surviving corporation in such merger), pursuant to the Arrow
Acquisition Agreement.



“Arrow Acquisition Agreement” means the Agreement and Plan of Merger dated as of July 20, 2007
among the Company, Merger Subsidiary and Arrow.



“Bank Credit Agreement” means the Credit Agreement, dated as of October 1, 2007 among the
Company, the guarantors party thereto, the lenders party thereto, JPMorgan Chase Bank, N.A., as
Administrative Agent and as Collateral Agent, and Bank of America, N.A., as Syndication Agent, as
amended, restated, replaced or refinanced from time to time.



“Bank Lender” means a “Lender”, as defined in the Bank Credit Agreement.



“Bank Loan Document” means “Loan Document”, as such term is defined in the Bank Credit
Agreement.



“Bank Loans” means “Loans”, as such term is defined in the Bank Credit Agreement.



“Business Day” means any day other than a Saturday, a Sunday or a day on which commercial
banks in New York City are required or authorized to be closed.



“Capital Lease Obligations” of any Person means the obligations of such Person to pay rent or
other amounts under any lease of (or other arrangement conveying the right to use) real or personal
property, or a combination thereof, which obligations are required to be classified and accounted
for as capital leases on a balance sheet of such Person under GAAP, and the amount of such
obligations shall be the capitalized amount thereof determined in accordance with GAAP.



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



“Cash Equivalent” means:



(a) direct obligations of, or obligations the principal of and interest on which are
unconditionally guaranteed by, the United States of America or any other country that is a member
of the Organization for Economic Cooperation and Development (or by any agency thereof to the
extent such obligations are backed by the full faith and credit of the United States of America or
such other country), in each case maturing within one year from the date of acquisition thereof;



(b) investments in commercial paper maturing within 270 days from the date of acquisition
thereof and having, at such date of acquisition, the highest credit rating obtainable from S&P or
from Moody’s;



(c) investments in certificates of deposit, banker’s acceptances and time deposits maturing
within 180 days from the date of acquisition thereof issued or guaranteed by or placed with, and
money market deposit accounts issued or offered by, any domestic office of any commercial bank
organized under the laws of the United States of America or any State thereof or any other country
that is a member of the Organization for Economic Cooperation and Development which has a combined
capital and surplus and undivided profits of not less than $500,000,000;



(d) fully collateralized repurchase agreements with a term of not more than 30 days for
securities described in clause (a) of this definition and entered into with a financial institution
satisfying the criteria described in clause (c) of this definition;



(e) money market funds that (i) comply with the criteria set forth in SEC Rule 2a-7 under the
Investment Company Act of 1940, (ii) are rated AAA by S&P and Aaa by Moody’s and (iii) have
portfolio assets of at least $5,000,000,000; and



(f) auction rate securities maturing in 45 days or less consisting of municipal securities
having the highest credit rating obtainable from S&P or from Moody’s.



“Change of Control” shall be deemed to have occurred with respect to the Company upon the
(a) acquisition of ownership, directly or indirectly, beneficially or of record, by any Person or
group (within the meaning of the Exchange Act and the rules of the SEC thereunder as in effect on
the date hereof) of shares representing more than 50% of the aggregate ordinary voting power
represented by the issued and outstanding Capital Stock of the Company; (b) occupation of a
majority of the seats (other than vacant seats) on the board of directors of the Company by Persons
who were neither (i) nominated by the board of directors of the Company nor (ii) appointed by
directors so nominated; or (c)acquisition of direct or indirect Control of the Company by any
Person or group.



“Closing” is defined in Section 3.



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



“Collateral” shall have the meaning ascribed to such term in the Intercreditor Agreement.



“Collateral Agent” means JPMorgan Chase Bank, N.A., in its capacity as collateral agent for
the Secured Parties under the Pledge Agreement and the Intercreditor Agreement.



“Company” is defined in the first paragraph of this Agreement.



“Confidential Information” is defined in Section 20.



“Consolidated Actual EBITDA” means, with respect to the Company and its Subsidiaries for any
period, (a) Consolidated Net Income for such period plus (b) to the extent deducted in the
calculation of Consolidated Net Income for such period, (i) Consolidated Interest Expense, (ii) all
income taxes, (iii) depreciation and amortization and (iv) other non-recurring non-cash charges,
all as determined on a consolidated basis in accordance with GAAP; provided that, with
respect to any such period in which any Person (x) consolidates with or merges with the Company or
any Subsidiary, or conveys, transfers or leases all or substantially all of its assets in a single
transaction or series of transactions to the Company or any Subsidiary, or (y) ceases to be a
Subsidiary during such period, EBITDA for such period shall be calculated on a pro forma basis so
as to give effect to such event as of the first day of such period.



“Consolidated EBITDA” means, for any period, the sum, for the Company and its Subsidiaries
(determined on a consolidated basis without duplication in accordance with GAAP), of the following:
(a) Consolidated Net Income for such period plus (b) without duplication and to the extent
reflected as a charge in the income statement for such period, the sum of (i) income tax expense,
(ii) Consolidated Interest Expense, amortization or writeoff of debt discount and debt issuance
costs and commissions, discounts and other fees and charges associated with Indebtedness (including
the Bank Loans), (iii) depreciation and amortization expense, including amortization of intangibles
(including, but not limited to, goodwill), (iv) transaction costs, fees and expenses related to the
Arrow Acquisition and the Transactions in an aggregate amount not exceeding $30,000,000,
(v) non-recurring charges and expenses related to the closing of certain of the Company’s
facilities in an aggregate amount not exceeding $15,000,000 through September 30, 2008,
(vi) non-recurring integration costs and expenses related to the Arrow Acquisition in an aggregate
amount not exceeding $45,000,000 for the period from the First Amendment Effective Date through
December 31, 2009, (vii) non-cash costs associated with inventory purchase price adjustments and
in-process research and development for the period from the First Amendment Effective Date through
December 31, 2008, (viii) non-cash stock-based compensation expense relating to stock options and
restricted stock granted to employees and directors, and cash-based option expenses and change of
control payments related to the Arrow Acquisition in an aggregate amount not exceeding $45,000,000
through September 30, 2008, (ix) other extraordinary, unusual or non-recurring non-cash charges and
(x) net cost savings and other acquisition synergies directly attributable to the Arrow Acquisition
within one year of the First Amendment Effective Date that are projected by the Company in good
faith to result therefrom and supportable or quantifiable by appropriate records in an aggregate
amount not exceeding (A) $34,400,000 for the four consecutive fiscal quarters or other period
ending September 30, 2007, (B) $33,000,000 for the four consecutive fiscal quarters or other period
ending December 31, 2007, (C) $29,000,000 for the four consecutive fiscal quarters or other period
ending March 31, 2008, (D) $24,000,000 for the four consecutive fiscal quarters or other period
ending June 30, 2008 and (E) $17,000,000 for the four consecutive fiscal quarters or other period
ending September 30, 2008 (it being understood that any amounts to be added to Consolidated Net
Income for any such period pursuant to this clause (x) shall not include any amounts that have been
taken into account in the determination of the Consolidated Net Income for such period) and
minus (c) to the extent included in the statement of such Consolidated Net Income for such
period, extraordinary, unusual or non-recurring income or gains; provided that, with
respect to any such period in which (x) the Arrow Acquisition shall have been consummated, (y) any
Person consolidates with or merges with the Company or any Subsidiary, or conveys, transfers or
leases all or substantially all of its assets in a single transaction or series of transactions to
the Company or any Subsidiary, and concurrently therewith becomes a Subsidiary, in a transaction
constituting a Material Acquisition or (z) any Person ceases to be a Subsidiary during such period,
or the Company or any Subsidiary shall have made a Material Disposition, Consolidated EBITDA for
such period shall be calculated on a pro forma basis so as to give effect to such event as of the
first day of such period; provided, further, that any operations classified as
“discontinued operations” shall be included in the calculation of Consolidated EBITDA. As used in
this definition, “Material Acquisition” means any Acquisition of property or series of
related Acquisitions that involves the payment of consideration by the Company and its Subsidiaries
in excess of $10,000,000; and “Material Disposition” means any Disposition of property or
series of related Dispositions of property that yields gross proceeds to the Company and its
Subsidiaries in excess of $10,000,000.



“Consolidated Interest Coverage Ratio” means, as at any date, the ratio of (a) Consolidated
EBITDA for the period of four consecutive fiscal quarters ending on or most recently ended prior to
such date to (b) Consolidated Interest Expense for such period.



“Consolidated Interest Expense” means, for any period, the sum, for the Company and its
Subsidiaries (determined on a consolidated basis without duplication in accordance with GAAP), of
the following: (a) all interest in respect of Indebtedness (including the interest component of
any payments in respect of Capital Lease Obligations and any implied interest component in
connection with the Receivables Securitization Program) accrued or capitalized during such period
(whether or not actually paid during such period) plus (b) the net amount payable (or
minus the net amount receivable) under Swap Agreements relating to interest during such
period (whether or not actually paid or received during such period), provided that with
respect to any such period in which (x) the Arrow Acquisition shall have been consummated, (y) any
Person consolidates with or merges with the Company or any Subsidiary, or conveys, transfers or
leases all or substantially all of its assets in a single transaction or series of transactions to
the Company or any Subsidiary, and concurrently therewith becomes a Subsidiary, in a transaction
constituting a Material Acquisition (as such term is defined in definition of “Consolidated
EBITDA”) or (z) any Person ceases to be a Subsidiary during such period, or the Company or any
Subsidiary shall have made a Material Disposition (as such term is defined in definition of
“Consolidated EBITDA”), Consolidated Interest Expense for such period shall be calculated on a pro
forma basis so as to give effect to such event as of the first day of such period;
provided, further, that, for purposes of calculating the Consolidated Interest
Coverage Ratio as at the end of the fiscal quarters ending September 30, 2007, December 31, 2007,
March 31, 2008 and June 30, 2008, Consolidated Interest Expense shall be calculated as follows:
(i) for the fiscal quarter ending September 30, 2007, Consolidated Interest Expense shall be deemed
to be the product of $37,000,000 (the “Third Quarter 2007 Interest Expense”) times 4,
(ii) for the fiscal quarter ending December 31, 2007, Consolidated Interest Expense shall be
determined by multiplying the sum of the Third Quarter 2007 Interest Expense plus
Consolidated Interest Expense for the fiscal quarter ending December 31, 2007 by 2, (iii) for the
fiscal quarter ending March 31, 2008, Consolidated Interest Expense shall be determined by
multiplying the sum of the Third Quarter 2007 Interest Expense plus Consolidated Interest
Expense for the two fiscal quarters ending March 31, 2008 by 4/3 and (iv) for the fiscal quarter
ending June 30, 2008, Consolidated Interest Expense shall be the sum of the Third Quarter 2007
Interest Expense plus Consolidated Interest Expense for the three fiscal quarters ending
June 30, 2008.



“Consolidated Leverage Ratio” means, as at any date, the ratio of (a) Consolidated Total
Indebtedness on such date to (b) Consolidated EBITDA for the period of four consecutive fiscal
quarters ending on or most recently ended prior to such date.



“Consolidated Net Income” means, for any period, the consolidated net income (or loss) of the
Company and its Subsidiaries, determined on a consolidated basis in accordance with GAAP;
provided that there shall be excluded (a) the income (or deficit) of any Person accrued
prior to the date it becomes a Subsidiary of the Company or is merged into or consolidated with the
Company or any of its Subsidiaries, (b) the income (or deficit) of any Person (other than a
Subsidiary of the Company) in which the Company or any of its Subsidiaries has an ownership
interest, except to the extent that any such income is actually received by the Company or such
Subsidiary in the form of dividends or similar distributions and (c) the undistributed earnings of
any Subsidiary of the Company to the extent that the declaration or payment of dividends or similar
distributions by such Subsidiary is not at the time permitted by the terms of any Contractual
Obligation (other than under any Financing Document, Other Senior Note Document or Bank Loan
Document) or any Requirement of Law, in each case applicable to such Subsidiary.



“Consolidated Net Worth” means, at any date, the stockholders’ equity of the Company and its
Subsidiaries at such date, determined on a consolidated basis in accordance with GAAP.



“Consolidated Total Assets” means, at any time, the aggregate amount of all assets of the
Company and its Subsidiaries at such time, as determined on a consolidated basis in accordance with
GAAP.



“Consolidated Total Indebtedness” means, at any date, the aggregate principal amount of all
Indebtedness of the Company and its Subsidiaries at such date, determined on a consolidated basis
in accordance with GAAP.



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



“Control” means the possession, directly or indirectly, of the power to direct or cause the
direction of the management or policies of a Person, whether through the ability to exercise voting
power, by contract or otherwise. “Controlling” and “Controlled” have meanings
correlative thereto.



“Default” means an event or condition the occurrence or existence of which would, with the
lapse of time or the giving of notice or both, become an Event of Default.



“Default Rate” means, with respect to any Series 2004-1 Note, that rate of interest per annum
that is the greater of (a) 2.0% above the rate of interest then in effect in respect of such Series
2004-1 Note pursuant to Section 8.9 or (b) 2.0% over the rate of interest publicly announced by
Bank of America, N.A. in New York, New York as its “base” or “prime” rate.



“Department of the Treasury Rule” means Blocked Persons, Specially Designated Nationals,
Specifically Designated Terrorists, Foreign Terrorist Organizations, and Specially Designated
Narcotics Traffickers: Additional Designations of Terrorism-Related Blocked Persons, 66 Fed. Reg.
54,404 (2001) (codified at appendix A to 31 CFR chapter V), as amended.



“Disposition” means any sale, assignment, transfer or other disposition of any property
(whether now owned or hereafter acquired) by the Company or any of its Subsidiaries to any Person,
including, without limitation, any sale of an equity interest in any Subsidiary. The terms
“Dispose” and “Disposed of” shall have correlative meanings.



“Domestic Subsidiary” means any Subsidiary of the Company organized or incorporated under the
laws of any jurisdiction within the United States of America.



“Environmental Laws” means any and all Federal, state, local, and foreign statutes, laws,
regulations, ordinances, rules, judgments, orders, decrees, permits, concessions, grants,
franchises, licenses, agreements or governmental restrictions relating to pollution and the
protection of the environment or the release of any materials into the environment, including but
not limited to those related to hazardous substances or wastes, air emissions and discharges to
waste or public systems.



“Equity Rights” means, with respect to any Person, any subscriptions, options, warrants,
commitments, preemptive rights or agreements of any kind (including any shareholders’ or voting
trust agreements) for the issuance, sale, registration or voting of, or securities convertible into
any additional shares of Capital Stock of any class of such Person.



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



“ERISA Affiliate” means any trade or business (whether or not incorporated) that is treated
as a single employer together with the Company under section 414 of the Code.



“Event of Default” is defined in Section 11.



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



“Excluded Equity Interests” means the Capital Stock of (a) each Excluded Subsidiary (other
than any First-Tier Foreign Subsidiary), (b) each Domestic Subsidiary of the Company listed on
Schedule 5.4 and noted as a “GMS Subsidiary” (but only prior to the date which is 60 days
after the First Amendment Effective Date) and (c) each First-Tier Foreign Subsidiary that is an
Immaterial Subsidiary.



“Excluded Subsidiary” means (a) a Foreign Subsidiary of the Company, (b) each special purpose
Subsidiary which issues Indebtedness under a securitization transaction or program and each
non-wholly owned Subsidiary, in each case, existing on the First Amendment Effective Date and
listed on Schedule 5.4 to the First Amendment, (c) any special purpose Subsidiary formed or
acquired after the First Amendment Effective Date which issues Indebtedness under a securitization
transaction or program, (d) any captive insurance company that is a Subsidiary of the Company and
(e) a Domestic Subsidiary of the Company that is an Immaterial Subsidiary.



“Financing Documents” means this Agreement, the First Amendment, the Notes, the Intercreditor
Agreement, the Pledge Agreement and the Subsidiary Guaranty Agreement.



“First Amendment” means that certain First Amendment to Note Purchase Agreement, dated as of
October 1, 2007, by and among the Company and the holders of Notes party thereto, as amended,
restated or otherwise modified from time to time.



“First Amendment Effective Date” means October 1, 2007.



“First-Tier Foreign Subsidiary” means any Foreign Subsidiary that is owned directly by the
Company or any Domestic Subsidiary (other than any Excluded Subsidiary).



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



“GAAP” means generally accepted accounting principles as in effect from time to time in the
United States of America.



“Governmental Authority” means



(a) the government of




(i) the United States of America or any State or other political subdivision thereof,
or




(ii) any jurisdiction in which the Company or any Subsidiary conducts all or any part
of its business, or which asserts jurisdiction over any properties of the Company or any
Subsidiary, or



(b) any entity exercising executive, legislative, judicial, regulatory or administrative
functions of, or pertaining to, any such government.



“Guarantee” of or by any Person (the “guarantor”) means any obligation, contingent or
otherwise, of the guarantor guaranteeing or having the economic effect of guaranteeing any
Indebtedness or other obligation of any other Person (the “primary obligor”) in any manner,
whether directly or indirectly, and including any obligation of the guarantor, direct or indirect,
(a) to purchase or pay (or advance or supply funds for the purchase or payment of) such
Indebtedness or other obligation or to purchase (or to advance or supply funds for the purchase of)
any security for the payment thereof, (b) to purchase or lease property, securities or services for
the purpose of assuring the owner of such Indebtedness or other obligation of the payment thereof,
(c) to maintain working capital, equity capital or any other financial statement condition or
liquidity of the primary obligor so as to enable the primary obligor to pay such Indebtedness or
other obligation or (d) as an account party in respect of any letter of credit or letter of
guaranty issued to support such Indebtedness or obligation; provided that the term
Guarantee shall not include endorsements for collection or deposit in the ordinary course of
business. In any computation of the indebtedness or other liabilities of the obligor under any
Guarantee, the indebtedness or other obligations that are the subject of such Guarantee shall be
assumed to be direct obligations of such obligor.



“Hazardous Material” means any and all pollutants, toxic or hazardous wastes or any other
substances that might pose a hazard to health or safety, the removal of which may be required or
the generation, manufacture, refining, production, processing, treatment, storage, handling,
transportation, transfer, use, disposal, release, discharge, spillage, seepage, or filtration of
which is or shall be restricted, prohibited or penalized by any applicable law (including, without
limitation, asbestos, urea formaldehyde foam insulation and polychlorinated biphenyls).



“holder” means, with respect to any Note, the Person in whose name such Note is registered in
the register maintained by the Company pursuant to Section 13.1.



“Hudson RCI Acquisition” means the acquisition of Hudson Respiratory Care Inc., a California
corporation (“Hudson”) pursuant to that certain Agreement and Plan of Merger dated as of May 17,
2004 among the Company, TFX Acquisition Corporation, Freeman Spogli Company LLC, F.S. Equity
Partners IV, L.P., River Holding Corporation and Hudson.



“Immaterial Subsidiary” means (a) as of the First Amendment Effective Date, any Domestic
Subsidiary listed on Schedule 5.4 to the First Amendment and (b) at any time thereafter, any
Domestic Subsidiary or First-Tier Foreign Subsidiary designated as such by the Company in a
certificate delivered by the Company to all holders of Notes (and which designation has not been
rescinded in a subsequent certificate of the Company delivered to such holders), provided
that (i) no Subsidiary shall be (or may be so designated as) an Immaterial Subsidiary if such
Subsidiary has assets of more than $10,000,000 and (ii) the aggregate amount of the assets of all
Immaterial Subsidiaries may not at any time exceed 5% of the consolidated assets of the Company and
its Subsidiaries, determined as of the end of the fiscal quarter or fiscal year most recently ended
for which financial statements are available.



“Indebtedness” of any Person means, without duplication,




(a) all obligations of such Person for borrowed money (including, without limitation,
any such obligations convertible into Capital Stock or other securities) or with respect to
deposits or advances of any kind,




(b) all obligations of such Person evidenced by bonds, debentures, notes or similar
instruments,




(c) all obligations of such Person upon which interest charges are customarily paid,




(d) all obligations of such Person under conditional sale or other title retention
agreements relating to property acquired by such Person,




(e) all obligations of such Person in respect of the deferred purchase price of
property or services (excluding current accounts payable incurred in the ordinary course of
business),




(f) all Indebtedness of others secured by (or for which the holder of such Indebtedness
has an existing right, contingent or otherwise, to be secured by) any Lien on property owned
or acquired by such Person, whether or not the Indebtedness secured thereby has been
assumed,




(g) all Guarantees by such Person of Indebtedness of others,




(h) all Capital Lease Obligations of such Person,




(i) all obligations, contingent or otherwise, of such Person as an account party in
respect of letters of credit and letters of guaranty,




(j) all obligations, contingent or otherwise, of such Person in respect of bankers’
acceptances and




(k) all mandatorily redeemable preferred stock of such Person;



provided that “Indebtedness” shall not include (i) for purposes of calculating the
Consolidated Leverage Ratio only, contingent obligations under clauses (i) and (j) above and (ii)
intercompany current liabilities incurred in the ordinary course of business in connection with the
cash management operations of the Company and its Subsidiaries. The Indebtedness of any Person
shall include the Indebtedness of any other entity (including any partnership in which such Person
is a general partner) to the extent such Person is liable therefor as a result of such Person’s
ownership interest in or other relationship with such entity, except to the extent the terms of
such Indebtedness provide that such Person is not liable therefor.



“INHAM Exemption” is defined in Section 6.2(e).



“Institutional Investor” means (a) any original purchaser of a Note, (b) any holder of a Note
holding Notes in an aggregate principal amount of $1,000,000 or more, and (c) any bank, trust
company, savings and loan association or other financial institution, any pension plan, any
investment company, any insurance company, any broker or dealer, or any other similar financial
institution or entity, regardless of legal form.



“Intercreditor Agreement” means that certain Intercreditor Agreement, dated as of October 1,
2007, by and among the Secured Parties, the Collateral Agent and the Obligors, in the form attached
to the First Amendment as Exhibit F, as amended, restated or otherwise modified from time
to time.



“Investment” means, for any Person: (a) the ownership of Capital Stock, bonds, notes,
debentures, partnership or other ownership interests or other securities of any other Person;
(b) any deposit with, or advance, loan or other extension of credit to, any other Person including
the purchase of property from another Person subject to an understanding or agreement, contingent
or otherwise, to resell such property to such Person, but excluding any such advance, loan or
extension of credit having a term not exceeding 90 days arising in connection with the sale of
(i) inventory or supplies by such Person in the ordinary course of business or (ii) accounts
receivable in connection with any Receivables Securitization Program; (c) any Guarantee of, or
other contingent obligation with respect to, Indebtedness or other liability of any other Person
and (without duplication) any amount committed to be advanced, lent or extended to such Person; or
(d) any Swap Agreement; provided that “Investment” shall not include intercompany current
liabilities incurred in the ordinary course of business in connection with the cash management
operations of the Company and its Subsidiaries.



“Lien” means, with respect to any asset, (a) any mortgage, deed of trust, lien, pledge,
hypothecation, encumbrance, charge or security interest in, on or of such asset, (b) the interest
of a vendor or a lessor under any conditional sale agreement, capital lease or title retention
agreement (or any financing lease having substantially the same economic effect as any of the
foregoing) relating to such asset and (c) in the case of securities, any purchase option, call or
similar right of a third party with respect to such securities.



“Make-Whole Amount” is defined in Section 8.8.



“Material” means material in relation to the business, operations, affairs, financial
condition, assets, properties, or prospects of the Company and its Subsidiaries taken as a whole.



“Material Adverse Effect” means a material adverse effect on (a) the business, operations,
affairs, condition (financial or otherwise), prospects, assets or properties of the Company and its
Subsidiaries taken as a whole, or (b) the ability of the Company to perform its obligations under
any of the Financing Documents to which it is a party, (c) the ability of any Subsidiary Guarantor
to perform its obligations under any of the Financing Documents to which it is a party, or (d) the
validity or enforceability of any Financing Document.



“Material Indebtedness” means Indebtedness (other than the Notes), or obligations in respect
of one or more Swap Agreements, of any one or more of the Company and its Subsidiaries in an
aggregate principal amount exceeding $35,000,000. For purposes of determining Material
Indebtedness, the “principal amount” of the obligations of any Person in respect of any
Swap Agreement at any time shall be the maximum aggregate amount (giving effect to any netting
agreements) that such Person would be required to pay if such Swap Agreement were terminated at
such time.



“Memorandum” is defined in Section 5.3.



“Merger Subsidiary” means AM Sub Inc., a Pennsylvania corporation.



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



“Multiemployer Plan” means any Plan that is a “multiemployer plan” (as such term is defined in
section 4001(a)(3) of ERISA).



“NAIC Annual Statement” is defined in Section 6.2(a).



“Notes” is defined in Section 1.



“Obligor” means the Company and the Subsidiary Guarantors.



“Officer’s Certificate” means a certificate of a Senior Financial Officer or of any other
officer of the Company whose responsibilities extend to the subject matter of such certificate.



“Other Senior Note Agreements” means the 2007 Note Purchase Agreement and the other agreements
pursuant to which the Other Senior Notes were issued.



“Other Senior Note Documents” means the Other Senior Note Agreements, the Other Senior Notes
and the financing documents entered into in connection therewith (including, the “Financing
Documents” as defined in any such agreements).



“Other Senior Notes” means (a) the senior notes of the Company issued pursuant to a Note
Purchase Agreement, dated as of October 25, 2002, in aggregate principal amount of $50,000,000
outstanding as of the First Amendment Effective Date and due October 25, 2012, (b) the 7.62% senior
notes of the Company issued pursuant to a Note Purchase Agreement, dated as of the First Amendment
Effective Date, in aggregate principal amount of $130,000,000 outstanding as of the First Amendment
Effective Date and due October 1, 2012, (c) the 7.94% senior notes of the Company issued pursuant
to a Note Purchase Agreement, dated as of the First Amendment Effective Date, in aggregate
principal amount of $40,000,000 outstanding as of the First Amendment Effective Date and due
October 1, 2014 and (d) the floating rate senior notes of the Company issued pursuant to a Note
Purchase Agreement, dated as of First Amendment Effective Date, in aggregate principal amount of
$30,000,000 outstanding as of the First Amendment Effective Date and due October 1, 2012.



“PBGC” means the Pension Benefit Guaranty Corporation referred to and defined in ERISA or any
successor thereto.



“Permitted Encumbrances” means:



(a) Liens imposed by law for taxes that are not yet due or are being contested in compliance
with Section 9.4;



(b) carriers’, warehousemen’s, mechanics’, materialmen’s, repairmen’s and other like Liens
imposed by law, arising in the ordinary course of business and securing obligations that are not
overdue by more than 30 days or are being contested in compliance with Section 9.4;



(c) pledges and deposits made in the ordinary course of business in compliance with workers’
compensation, unemployment insurance and other social security laws or regulations;



(d) cash deposits to secure the performance of bids, trade contracts, leases, statutory
obligations, surety and appeal bonds, performance bonds and other obligations of a like nature, in
each case in the ordinary course of business;



(e) judgment liens in respect of judgments that do not constitute an Event of Default under
Section 11(i); and



(f) easements, zoning restrictions, rights-of-way and similar encumbrances on real property
imposed by law or arising in the ordinary course of business that do not secure any monetary
obligations and do not materially detract from the value of the affected property or interfere with
the ordinary conduct of business of the Company or any Subsidiary;



provided that the term “Permitted Encumbrances” shall not include any Lien securing Indebtedness.



“Person” means an individual, partnership, corporation, limited liability company,
association, trust, unincorporated organization, or a government or agency or political subdivision
thereof.



“Plan” means an “employee pension benefit plan” (other than a Multiemployer Plan) subject to
the provisions of Title IV of ERISA or section 412 of the Code or section 302 of ERISA that is or,
within the preceding five years, has been established or maintained, or to which contributions are
or, within the preceding five years, have been made or required to be made, by the Company or any
ERISA Affiliate or with respect to which the Company or any ERISA Affiliate may have any liability.



“Pledge Agreement” means that certain Pledge Agreement, dated as of October 1, 2007, by and
between the Company and the Collateral Agent, in the form attached to the First Amendment as
Exhibit G, together with any other pledge or similar agreement entered into by any
Subsidiary Guarantor with respect to the Collateral on or after the date hereof, as amended,
restated or otherwise modified from time to time.



“Primary Credit Agreement” means the main credit agreement, loan agreement, note purchase
agreement or other credit agreement in effect from time to time among the Company and/or any of its
Subsidiaries and a syndicate or club of lenders, which agreement is used to fund the consolidated
working capital needs of the Company and its Subsidiaries, including, without limitation, the Bank
Credit Agreement, and any renewal, refunding, refinancing or replacement thereof.



“property” or “properties” means, unless otherwise specifically limited, real or personal
property of any kind, tangible or intangible, choate or inchoate.



“PTE” means a Prohibited Transaction Exemption issued by the Department of Labor.



“Purchaser” is defined in the first paragraph of this Agreement.



“QPAM Exemption” means Prohibited Transaction Class Exemption 84-14 issued by the United
States Department of Labor.



“Receivables Securitization Program” is defined in Section 10.2(e).



“Recovery Event” means any settlement of or payment in respect of any property or casualty
insurance claim (but not to the extent such claim compensates for any loss of revenues or
interruption of business or operations caused thereby) or any condemnation proceeding relating to
any asset of the Company or any of its Subsidiaries with a value in excess of $10,000,000 (for
purposes of this definition, a “Material Recovery”), (a) for which a Reinvestment Notice has not
been delivered to the holders of Notes within five Business Days of such Material Recovery or (b)
for which a Reinvestment Notice has been so delivered within such time period but with respect to
which either (i) a period of twelve months has passed since the date of such Material Recovery or
(ii) the Company shall have determined not to, or shall have otherwise ceased to, acquire assets
useful in the Company’s or any Subsidiary’s business with all or any portion of the Reinvestment
Deferred Amount of such Material Recovery.



“Reinvestment Deferred Amount” means, with respect to any Reinvestment Event, the aggregate
Section 8.4(a) Net Proceeds received by the Company or any of its Subsidiaries in connection
therewith which are not applied to prepay the Notes pursuant to Section 8.4(a) as a result of the
delivery of a Reinvestment Notice.



“Reinvestment Event” means any Recovery Event in respect of which the Company has delivered a
Reinvestment Notice.



“Reinvestment Notice” means a written notice executed by a Responsible Officer stating that no
Default has occurred and is continuing and that the Company or any Subsidiary intends and expects
to use all or a specified portion of the Section 8.4(a) Net Proceeds of a Recovery Event to acquire
assets useful in its business.



“Relevant Share” means as of the date of receipt by the Company or any Subsidiary of any
Section 8.4(a) Net Proceeds or Section 8.4(b) Net Proceeds, as the case may be, a ratio equal to
(a) the aggregate outstanding principal amount of the Notes at such time over (b) the sum of (i)
the aggregate outstanding principal amount of the Term Loans plus (ii) the aggregate
outstanding principal amount of the Other Senior Notes plus (iii) the aggregate outstanding
principal amount of the Notes.



“Required Holders” means, at any time, the holders of greater than 50% in principal amount of
the Series 2004-1 Notes at the time outstanding, exclusive of Notes then owned by the Company or
any of its Affiliates.



“Requirement of Law” means, as to any Person, the certificate of incorporation and by-laws or
other organizational or governing documents of such Person, and any law, treaty, rule or regulation
or determination of an arbitrator or a court or other Governmental Authority, in each case
applicable to or binding upon such Person or any of its property or to which such Person or any of
its property is subject.



“Responsible Officer” means any Senior Financial Officer and any other senior officer of the
Company with responsibility for the administration of the relevant portion of this Agreement.



“Restricted Payment” means any dividend or other distribution (whether in cash, securities or
other property) with respect to any shares of any class of Capital Stock of the Company or any of
its Subsidiaries, or any payment (whether in cash, securities or other property), including any
sinking fund or similar deposit, on account of the purchase, redemption, retirement, acquisition,
cancellation or termination of any such shares of Capital Stock of the Company or any Equity Rights
with respect to any such shares of Capital Stock of the Company.



“S&P” means Standard & Poor’s Ratings Services.



“SEC” means the United States Securities and Exchange Commission or any successor agency.



“Section 8.4(a) Disposition” means any Disposition (excluding (i) a Section 8.4(b)
Disposition, and (ii) any such Disposition permitted by clauses (a), (b), (c), (d) and (e) of
Section 10.4) which yields gross proceeds to the Company or any of its Subsidiaries (valued at the
initial principal amount thereof in the case of non-cash proceeds consisting of notes or other debt
securities and valued at fair market value in the case of other non-cash proceeds) in excess of
$10,000,000.



“Section 8.4(a) Net Proceeds” means in connection with any Section 8.4(a) Proceeds Event, the
proceeds thereof in the form of cash (including any such proceeds received by way of deferred
payment of principal pursuant to a note or installment receivable or purchase price adjustment
receivable or the sale or disposition of any non-cash consideration or otherwise, but only as and
when received and excluding the portion of such deferred payment constituting interest), net of
attorneys’ fees, accountants’ fees, investment banking fees, amounts required to be applied to the
repayment of Indebtedness secured by a Lien expressly permitted hereunder on any asset which is the
subject of such Section 8.4(a) Proceeds Event (other than any Lien pursuant to a Bank Loan Document
including, without limitation, the Pledge Agreement), underwriting discounts and commissions (in
the case of the issuance or incurrence of Indebtedness) and other costs, fees and expenses actually
incurred in connection therewith and net of taxes paid or reasonably estimated to be payable as a
result thereof (after taking into account any available tax credits or deductions and any tax
sharing arrangements) and net of amounts deposited in escrow in connection therewith or reasonably
expected to be paid as a result of any purchase price adjustment, indemnities or reserves related
thereto (such amounts shall be Section 8.4(a) Net Proceeds to the extent and at the time released
or not required to be so used); provided that the amount of Section 8.4(a) Net Proceeds of
any Recovery Event described in clause (b) of the definition thereof shall be deemed to be the
Reinvestment Deferred Amount relating to such Recovery Event less any amount expended to acquire
assets useful in the Company’s or any Subsidiary’s business.



“Section 8.4(a) Prepayment Date” is defined in Section 8.4(a).



“Section 8.4(a) Proceeds Event” means and includes:



(a) any Section 8.4(a) Disposition occurring at any time that the Consolidated Leverage Ratio,
determined as of the last day of the period of four fiscal quarters of the Company most recently
ended at such time, is greater than 3.50 to 1.00; or



(b) any (i) Recovery Event or (ii) issuance or incurrence by the Company or any Subsidiary of
Indebtedness (other than Indebtedness permitted under Section 10.1(a) through (h) hereof), in any
such case under the foregoing clauses (i) or (ii) occurring at any time that the Consolidated
Leverage Ratio, determined as of the last day of the period of four fiscal quarters of the Company
most recently ended at such time, is greater than 4.00 to 1.00.



“Section 8.4(a) Response Date” is defined in Section 8.4(a).



“Section 8.4(b) Disposition” means any Disposition made any time that the Consolidated
Leverage Ratio, determined as of the last day of the period of four fiscal quarters of the Company
most recently ended at such time, is less than or equal to 3.50 to 1.00.



“Section 8.4(b) Net Proceeds” means in connection with any Section 8.4(b) Disposition, the
proceeds thereof in the form of cash (including any such proceeds received by way of deferred
payment of principal pursuant to a note or installment receivable or purchase price adjustment
receivable or the sale or disposition of any non-cash consideration or otherwise, but only as and
when received and excluding the portion of such deferred payment constituting interest), net of
attorneys’ fees, accountants’ fees, investment banking fees, amounts required to be applied to the
repayment of Indebtedness secured by a Lien expressly permitted hereunder on any asset which is the
subject of such Section 8.4(b) Disposition (other than any Lien pursuant to a Bank Loan Document
including, without limitation, the Pledge Agreement), and other costs, fees and expenses actually
incurred in connection therewith and net of taxes paid or reasonably estimated to be payable as a
result thereof (after taking into account any available tax credits or deductions and any tax
sharing arrangements) and net of amounts deposited in escrow in connection therewith or reasonably
expected to be paid as a result of any purchase price adjustment, indemnities or reserves related
thereto (such amounts shall be Section 8.4(b) Net Proceeds to the extent and at the time released
or not required to be so used).



“Section 8.4(b) Prepayment Date” is defined in Section 8.4(b).



“Section 8.4(b) Response Date” is defined in Section 8.4(b).



“Secured Parties” has the meaning ascribed thereto in the Intercreditor Agreement.



“Securities Act” means the Securities Act of 1933, as amended from time to time.



“Senior Financial Officer” means the chief financial officer, principal accounting officer,
treasurer or comptroller of the Company.



“Series” is defined in Section 1.1.



“Series 2004-1 Notes” is defined in Section 1.2.



“Series 2004-1 Tranche A Notes” is defined in Section 1.2.



“Series 2004-1 Tranche B Notes” is defined in Section 1.2.



“Series 2004-1 Tranche C Notes” is defined in Section 1.2.



“Source” is defined in Section 6.2.



“Subsidiary” means, with respect to any Person (the “parent”) at any date, any
corporation, limited liability company, partnership, association or other entity the accounts of
which would be consolidated with those of the parent in the parent’s consolidated financial
statements if such financial statements were prepared in accordance with GAAP as of such date, as
well as any other corporation, limited liability company, partnership, association or other entity
(a) of which securities or other ownership interests representing more than 50% of the equity or
more than 50% of the ordinary voting power or, in the case of a partnership, more than 50% of the
general partnership interests are, as of such date, owned, Controlled or held, or (b) that is, as
of such date, otherwise Controlled, by the parent or one or more subsidiaries of the parent or by
the parent and one or more subsidiaries of the parent. Unless otherwise specified, “Subsidiary”
means a Subsidiary of the Company.



“Subsidiary Guarantor” means (a) each Domestic Subsidiary of the Company as of the First
Amendment Effective Date (after giving effect to the Arrow Acquisition, but excluding any Excluded
Subsidiary) and (b) each other Subsidiary of the Company that shall become a Subsidiary Guarantor
pursuant to Section 9.7, in each case so long as such Subsidiary shall remain a Subsidiary
Guarantor party hereto.



“Subsidiary Guaranty Agreement” means that certain Subsidiary Guaranty Agreement, dated as of
October 1, 2007, by the Subsidiary Guarantors in favor of the holders of Notes, in the form
attached as Exhibit H to the First Amendment, as amended, restated or otherwise modified
from time to time.



“Swap Agreement” means any agreement with respect to any swap, forward, future or derivative
transaction or option or similar agreement involving, or settled by reference to, one or more
rates, currencies, commodities, equity or debt instruments or securities, or economic, financial or
pricing indices or measures of economic, financial or pricing risk or value or any similar
transaction or any combination of these transactions; provided that no phantom stock or
similar plan providing for payments only on account of services provided by current or former
directors, officers, employees or consultants of the Company or the Subsidiaries shall be a Swap
Agreement.



“Term Loan” has the meaning ascribed thereto in the Bank Credit Agreement.



“Transactions” means the execution, delivery and performance by each Obligor of the First
Amendment, the Financing Documents, the Bank Credit Agreement and the other Bank Loan Documents,
the 2002 NPA Amendment, the 2007 Note Purchase Agreement, the issuance of the 2007 Notes and the
borrowing of Bank Loans, the use of the proceeds thereof and the issuance of letters of credit
under the Bank Credit Agreement. 



“2002 NPA Amendment” means the Second Amendment to Note Purchase Agreement, dated as of
October 25, 2002, by and among the Company and the holders of the notes issued thereunder, entered
into on the First Amendment Effective Date.



“2007 Note Purchase Agreement” means the Note Purchase Agreement, dated as of the First
Amendment Effective Date, pursuant to which the 2007 Notes were issued.



“2007 Notes” means the senior notes described in clauses (b), (c) and (d) of the definition of
“Other Senior Notes”.



“USA Patriot Act” means United States Public Law 107-56, Uniting and Strengthening America by
Providing Appropriate Tools Required to Intercept and Obstruct Terrorism (USA PATRIOT ACT) Act of
2001, as amended from time to time, and the rules and regulations promulgated thereunder from time
to time in effect.




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