APPLICABLE
PLEDGE AGREEMENT OR SECURITY AGREEMENT AS ADDITIONAL COLLATERAL SECURITY FOR THE
OBLIGATIONS; (2) BORROWER SHALL RECORD ALL INTERCOMPANY TRANSACTIONS ON ITS
BOOKS AND RECORDS IN A MANNER REASONABLY SATISFACTORY TO AGENT; (3) THE
OBLIGATIONS OF BORROWER UNDER ANY SUCH INTERCOMPANY NOTES SHALL BE SUBORDINATED
TO THE OBLIGATIONS OF BORROWER HEREUNDER IN A MANNER REASONABLY SATISFACTORY TO
AGENT; (4) AT THE TIME ANY SUCH INTERCOMPANY LOAN OR ADVANCE IS MADE BY BORROWER
AND AFTER GIVING EFFECT THERETO, BORROWER SHALL BE SOLVENT; AND (5) NO DEFAULT
OR EVENT OF DEFAULT WOULD OCCUR AND BE CONTINUING AFTER GIVING EFFECT TO ANY
SUCH PROPOSED INTERCOMPANY LOAN; AND (2) LOANS AND ADVANCES OWING BY THE ITS
COMPANIES TO NON-AFFILIATED THIRD PARTIES IN AN AGGREGATE PRINCIPAL AMOUNT NOT
TO EXCEED $7,500,000;
(C)
UNSECURED, SUBORDINATED DEBT OF BORROWER IN
A PRINCIPAL AMOUNT NOT TO EXCEED $10,000,000 IN THE AGGREGATE AT ANY TIME
OUTSTANDING;
29
(D)
INDEBTEDNESS IN AN AGGREGATE PRINCIPAL
AMOUNT NOT TO EXCEED $10,000,000 IN THE AGGREGATE AT ANY TIME OUTSTANDING
SECURED BY PURCHASE MONEY LIENS OR INCURRED WITH RESPECT TO CAPITAL LEASES;
(E)
INDEBTEDNESS DESCRIBED ON SCHEDULE 3.1, AND
ANY EXTENSIONS, RENEWALS OR REFINANCINGS OF SUCH EXISTING INDEBTEDNESS SO LONG
AS (I) THE PRINCIPAL AMOUNT OF SUCH INDEBTEDNESS AFTER SUCH RENEWAL, EXTENSION
OR REFINANCING SHALL NOT EXCEED THE PRINCIPAL AMOUNT OF SUCH INDEBTEDNESS WHICH
WAS OUTSTANDING IMMEDIATELY PRIOR TO SUCH RENEWAL, EXTENSION OR REFINANCING PLUS
ACCRUED AND UNPAID INTEREST AND RELATED FEES AND (II) SUCH INDEBTEDNESS SHALL
NOT BE SECURED BY ANY ASSETS OTHER THAN ASSETS SECURING SUCH INDEBTEDNESS, IF
ANY, PRIOR TO SUCH RENEWAL, EXTENSION OR REFINANCING;
(F)
INDEBTEDNESS CONSTITUTING OBLIGATIONS TO
REIMBURSE WORKER'S COMPENSATION INSURANCE COMPANIES FOR CLAIMS PAID BY SUCH
COMPANIES ON BORROWER'S OR ANY OF ITS SUBSIDIARIES' BEHALF IN ACCORDANCE WITH
THE POLICIES ISSUED TO BORROWER OR SUCH SUBSIDIARY OF BORROWER;
(G)
INDEBTEDNESS SECURED BY THE LIENS PERMITTED
BY CLAUSES (A), (E) AND (L) OF THE DEFINITION OF PERMITTED ENCUMBRANCES;
(H)
INDEBTEDNESS OF A SUBSIDIARY OF BORROWER
ACQUIRED AFTER THE RESTATEMENT EFFECTIVE DATE AND INDEBTEDNESS OF A PERSON
MERGED OR CONSOLIDATED WITH OR INTO BORROWER OR A SUBSIDIARY OF BORROWER AFTER
THE RESTATEMENT EFFECTIVE DATE, WHICH INDEBTEDNESS IN EACH CASE EXISTS AT THE
TIME OF SUCH ACQUISITION, MERGER OR CONSOLIDATION AND WAS NOT CREATED OR
INCURRED IN CONTEMPLATION OF SUCH ACQUISITION, MERGER OR CONSOLIDATION AND WHERE
SUCH ACQUISITION, MERGER OR CONSOLIDATION IS NOT PROHIBITED UNDER THIS
AGREEMENT;
(I)
THE NET OBLIGATIONS OF SUCH PERSON UNDER
ANY FOREIGN EXCHANGE CONTRACT, CURRENCY SWAP AGREEMENT, INTEREST RATE SWAP, CAP
OR COLLAR AGREEMENT OR OTHER SIMILAR AGREEMENT OR ARRANGEMENT DESIGNED TO ALTER
THE RISKS OF THAT PERSON ARISING FROM FLUCTUATIONS IN CURRENCY VALUES OR
INTEREST RATES, IN EACH CASE WHETHER CONTINGENT OR MATURED, PROVIDED THAT ANY
SUCH AGREEMENT OR ARRANGEMENT IS NOT SPECULATIVE IN NATURE, IS UTILIZED BY SUCH
CREDIT PARTY SOLELY IN CONNECTION WITH ACTUAL FOREIGN CURRENCY OR ACTUAL
INTEREST RATE EXPOSURE OF A CREDIT PARTY OR OTHERWISE RELATED TO PURCHASES
PERMITTED HEREUNDER FROM FOREIGN SUPPLIERS OR IS OTHERWISE ENTERED INTO TO