Document:

<PAGE>

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                               CREDIT AGREEMENT

                           dated as of July 31, 2000

                                     among

                              APPLIED POWER INC.
                   (doing business as Actuant Corporation),

                           THE LENDERS NAMED HEREIN

                                      and

                          CREDIT SUISSE FIRST BOSTON,
                          ---------------------------

          as Lead Arranger, Collateral Agent and Administrative Agent

                           FIRST UNION NATIONAL BANK

                               Syndication Agent

                                      and

                            ING (U.S.) CAPITAL LLC

                              Documentation Agent

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                               TABLE OF CONTENTS

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                                                  ARTICLE I

                                                 Definitions

SECTION 1.01.  Defined Terms........................................................................     1
SECTION 1.02.  Terms Generally......................................................................    26
SECTION 1.03.  Accounting Terms.....................................................................    26
SECTION 1.04.  Exchange Rates.......................................................................    26

                                                 ARTICLE II

                                                The Credits

SECTION 2.01.  Commitments..........................................................................    26
SECTION 2.02.  Loans................................................................................    27
SECTION 2.03.  Borrowing Procedure..................................................................    28
SECTION 2.04.  Evidence of Debt; Repayment of Loans.................................................    29
SECTION 2.05.  Fees.................................................................................    30
SECTION 2.06.  Interest on Loans....................................................................    30
SECTION 2.07.  Default Interest.....................................................................    31
SECTION 2.08.  Special Provisions Governing Eurocurrency Rate Loans.................................    31
SECTION 2.09.  Termination and Reduction of Commitments.............................................    32
SECTION 2.10.  Conversion and Continuation of Borrowings............................................    33
SECTION 2.11.  Repayment of Term Borrowings.........................................................    34
SECTION 2.12.  Prepayment...........................................................................    36
SECTION 2.13.  Mandatory Prepayments................................................................    37
SECTION 2.14.  Reserve Requirements; Change in Circumstances........................................    39
SECTION 2.15.  Change in Legality...................................................................    40
SECTION 2.16.  Indemnity............................................................................    41
SECTION 2.17.  Pro Rata Treatment...................................................................    41
SECTION 2.18.  Sharing of Setoffs...................................................................    42
SECTION 2.19.  Payments.............................................................................    42
SECTION 2.20.  Taxes................................................................................    43
SECTION 2.21.  Assignment of Commitments Under Certain Circumstances; Duty to
                   Mitigate.........................................................................    44
SECTION 2.22.  Swingline Loans......................................................................    45
SECTION 2.23.  Letters of Credit....................................................................    46
SECTION 2.24.  Borrowing Subsidiaries...............................................................    49
SECTION 2.25.  Additional Loan......................................................................    50

                                                  ARTICLE III

                                          Representations and Warranties

SECTION 3.01.  Organization; Powers.................................................................    51
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SECTION 3.02.  Authorization........................................................................    51
SECTION 3.03.  Enforceability.......................................................................    51
SECTION 3.04.  Governmental Approvals...............................................................    51
SECTION 3.05.  Financial Statements.................................................................    51
SECTION 3.06.  No Material Adverse Change...........................................................    52
SECTION 3.07.  Title to Properties; Possession Under Leases.........................................    52
SECTION 3.08.  Subsidiaries.........................................................................    53
SECTION 3.09.  Litigation; Compliance with Laws.....................................................    53
SECTION 3.10.  Agreements...........................................................................    53
SECTION 3.11.  Federal Reserve Regulations..........................................................    53
SECTION 3.12.  Investment Company Act; Public Utility Holding Company Act...........................    53
SECTION 3.13.  Use of Proceeds......................................................................    54
SECTION 3.14.  Tax Returns..........................................................................    54
SECTION 3.15.  No Material Misstatements............................................................    54
SECTION 3.16.  Employee Benefit Plans...............................................................    54
SECTION 3.17.  Environmental Matters................................................................    55
SECTION 3.18.  Insurance............................................................................    55
SECTION 3.19.  Security Documents...................................................................    55
SECTION 3.20.  Labor Matters........................................................................    56
SECTION 3.21.  Solvency.............................................................................    56
SECTION 3.22.  Representations and Warranties in Documents..........................................    56
SECTION 3.23.  Letters of Credit....................................................................    57
SECTION 3.24.  Contingent Obligations...............................................................    57

                                                   ARTICLE IV

                                              Conditions of Lending

SECTION 4.01.  All Credit Events....................................................................    57
SECTION 4.02.  First Credit Event...................................................................    58

                                                    ARTICLE V

                                               Affirmative Covenants

SECTION 5.01.  Existence; Businesses and Properties.................................................    62
SECTION 5.02.  Insurance............................................................................    62
SECTION 5.03.  Obligations and Taxes................................................................    63
SECTION 5.04.  Financial Statements, Reports, etc...................................................    63
SECTION 5.05.  Litigation and Other Notices.........................................................    64
SECTION 5.06.  Employee Benefits....................................................................    65
SECTION 5.07.  Maintaining Records; Access to Properties and Inspections............................    65
SECTION 5.08.  Use of Proceeds......................................................................    65
SECTION 5.09.  Compliance with Environmental Laws...................................................    65
SECTION 5.10.  Preparation of Environmental Reports.................................................    65
SECTION 5.11.  Further Assurances; Additional Collateral............................................    66
SECTION 5.12.  Interest Rate Protection.............................................................    67
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                                               ARTICLE VI

                                           Negative Covenants

SECTION 6.01.  Indebtedness.........................................................................    67
SECTION 6.02.  Liens................................................................................    69
SECTION 6.03.  Sale and Lease-Back Transactions.....................................................    70
SECTION 6.04.  Investments, Loans and Advances......................................................    71
SECTION 6.05.  Mergers, Consolidations, Sales of Assets and Acquisitions............................    72
SECTION 6.06.  Dividends............................................................................    73
SECTION 6.07.  Transactions with Affiliates.........................................................    74
SECTION 6.08.  Capital Expenditures.................................................................    74
SECTION 6.09.  Consolidated Interest Coverage Ratio.................................................    74
SECTION 6.10.  Consolidated Fixed Charge Coverage Ratio.............................................    75
SECTION 6.11.  Maximum Leverage Ratio...............................................................    76
SECTION 6.12.  Limitation on Modifications of Indebtedness; Modifications of Certificate of
                  Incorporation, By-laws and Certain Other Agreements, etc..........................    76
SECTION 6.13.  Limitation on Certain Restrictions on Subsidiaries...................................    77
SECTION 6.14.  Limitation on Issuance of Capital Stock..............................................    77
SECTION 6.15.  Limitation on Creation of Subsidiaries...............................................    77
SECTION 6.16.  Business.............................................................................    78
SECTION 6.17.  Designated Senior Indebtedness.......................................................    78
SECTION 6.18.  Fiscal Year..........................................................................    78

                                            ARTICLE VII

                                         Events of Default

                                           ARTICLE VIII

                         The Administrative Agent and the Collateral Agent

                                            ARTICLE IX

                                          Miscellaneous

SECTION 9.01.  Notices.............................................................................     83
SECTION 9.02.  Survival of Agreement...............................................................     83
SECTION 9.03.  Binding Effect......................................................................     83
SECTION 9.04.  Successors and Assigns..............................................................     84
SECTION 9.05.  Expenses; Indemnity.................................................................     87
SECTION 9.06.  Right of Setoff.....................................................................     88
SECTION 9.07.  Applicable Law......................................................................     88
SECTION 9.08.  Waivers; Amendment..................................................................     88
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SECTION 9.09.  Interest Rate Limitation............................................................     89
SECTION 9.10.  Entire Agreement....................................................................     89
SECTION 9.11.  WAIVER OF JURY TRIAL................................................................     89
SECTION 9.12.  Severability........................................................................     90
SECTION 9.13.  Counterparts........................................................................     90
SECTION 9.14.  Headings............................................................................     90
SECTION 9.15.  Jurisdiction; Consent to Service of Process.........................................     90
SECTION 9.16.  Judgment Currency...................................................................     90
SECTION 9.17.  Confidentiality.....................................................................     91

SIGNATURES     ....................................................................................    S-1

SCHEDULES
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Schedule 1.01(a)(i)     Mortgaged Owned Property
Schedule 1.01(a)(ii)    Leased Mortgaged Property
Schedule 1.01(b)        Subsidiary Guarantors
Schedule 2.01           Lenders and Commitments
Schedule 2.13(b)        Assets
Schedule 3.04           Governmental Approvals
Schedule 3.07(a)(i)     Real Property Owned In Fee
Schedule 3.07(a)(ii)    Leased Real Property
Schedule 3.07(e)        Condemnation Proceedings
Schedule 3.08           Subsidiaries
Schedule 3.09           Litigation
Schedule 3.10           Material Agreements
Schedule 3.14           Indemnified Taxes
Schedule 3.17           Environmental Matters
Schedule 3.18           Insurance
Schedule 3.19(c)        Mortgage Filing Offices
Schedule 4.02(a)        Other Local Counsel
Schedule 6.01           Outstanding Indebtedness on Closing Date
Schedule 6.02(n)        Liens Existing on Closing Date
Schedule 6.07           Transition Services

EXHIBITS
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Exhibit A               Form of Administrative Questionnaire
Exhibit B               Form of Assignment and Acceptance
Exhibit C-1             Form of Borrowing Request
Exhibit C-2             Form of Notice of Conversion/Continuation
Exhibit D               Form of Indemnity, Subrogation and Contribution Agreement
Exhibit E-1             Form of Mortgage
Exhibit E-2             Form of Leasehold Mortgage
Exhibit F               Form of Security Agreement
Exhibit G               Form of Subsidiary Guarantee Agreement
Exhibit H               Form of Opinion of Quarles & Brady
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                                      iv
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Exhibit I               Form of Opinion of Local Counsel
Exhibit J               Form of Assumption Agreement
Exhibit K               Form of Officers' Certificate
Exhibit L               Form of Landlord Lien Waiver

                                       v
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     CREDIT AGREEMENT dated as of July 31, 2000, among APPLIED POWER INC., a
Wisconsin corporation (doing business as Actuant Corporation) (the "Borrower" or
the "Company"), the Lenders (as defined in Article I), CREDIT SUISSE FIRST
BOSTON, a bank organized under the laws of Switzerland, acting through its New
York branch, as swingline lender (in such capacity, the "Swingline Lender"), as
an Issuing Bank (as defined in Article I), and as administrative agent (in such
capacity, the "Administrative Agent") and as collateral agent (in such capacity,
the "Collateral Agent") for the Lenders, FIRST UNION NATIONAL BANK, as
syndication agent (in such capacity, the "Syndication Agent"), ING (U.S.)
CAPITAL LLC, as documentation agent, (in such capacity, the "Documentation
Agent").

     Pursuant to the Spin-Off (such term and each other capitalized term used
but not defined herein having the meaning given it in Article I), the Borrower
intends to spin-off the Borrower's wholly-owned subsidiary, APW Ltd. and
pursuant to the Divestitures, the Borrower intends to sell certain assets,
including the capital stock of certain subsidiaries, and, in connection with
such Spin-Off and Divestitures, the Borrower intends to (i) consummate the
Tender Offer for the Existing Senior Subordinated Notes and (ii) pay other fees
and expenses, the aggregate cost of which will be approximately $450.0 million.

     The Borrower has requested the Lenders to extend credit in the form of (a)
Tranche A Term Loans on the Closing Date, in an aggregate principal amount not
in excess of $115,000,000 (including up to a maximum Dollar Equivalent of
$30,000,000 thereof in an Alternative Currency (as defined below)), (b) Tranche
B Term Loans on the Closing Date, in an aggregate principal amount not in excess
of $125,000,000, and (c) Revolving Loans at any time and from time to time prior
to the Revolving Credit Maturity Date, in an aggregate principal amount at any
time outstanding not in excess of $100,000,000.  The Borrower has requested the
Swingline Lender to extend credit, at any time and from time to time prior to
the Revolving Credit Maturity Date, in the form of Swingline Loans in an
aggregate principal amount at any time outstanding not in excess of $5,000,000.
The Borrower has requested the Issuing Bank to issue letters of credit, in an
aggregate face amount at any time outstanding not in excess of $17,000,000, to
support payment obligations incurred in the ordinary course of business by the
Borrower and its Subsidiaries.  The proceeds of the Term Loans and the Revolving
Loans are to be used, together with the proceeds of the New Senior Subordinated
Notes, solely (i) to consummate the Spin-Off, Divestitures and Tender Offer and
(ii) to pay related fees and expenses.  The remaining proceeds of the Revolving
Loans and the Swingline Loans are to be used solely for general corporate
purposes.

     The Lenders are willing to extend such credit to the Borrower and the
Issuing Bank is willing to issue letters of credit for the account of the
Borrower on the terms and subject to the conditions set forth herein.
Accordingly, the parties hereto agree as follows:

                                   ARTICLE I

                                  Definitions

     SECTION 1.01.  Defined Terms.  As used in this Agreement, the following
terms shall have the meanings specified below:

     "ABR Borrowing" shall mean a Borrowing comprised of ABR Loans.

     "ABR Loan" shall mean any ABR Term Loan or ABR Revolving Loan.
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                                      -2-

     "ABR Revolving Loan" shall mean any Revolving Loan bearing interest at a
rate determined by reference to the Alternate Base Rate in accordance with the
provisions of Article II.

     "ABR Term Borrowing" shall mean a Borrowing comprised of ABR Term Loans.

     "ABR Term Loan" shall mean any Term Loan bearing interest at a rate
determined by reference to the Alternate Base Rate in accordance with the
provisions of Article II.

     "Accounts Receivable Facility" shall mean any credit facility or
conditional sale contract or similar arrangement providing financing secured
directly or indirectly only by the accounts receivable of the Borrower or the
Subsidiaries, on terms reasonably acceptable to the Required Lenders.

     "Additional Collateral" shall have the meaning assigned to such term in
Section 5.11 hereof.

     "Additional Lender" shall have the meaning assigned to such term in Section
2.25 hereof.

     "Additional  Loan Commitment" shall have the meaning assigned to such term
in Section 2.25 hereof.

     "Adjusted EURIBOR" means, with respect to any EURIBOR Loans for any
Interest Period, an interest rate per annum equal to the product of (a) EURIBOR
in effect for such Interest Period and (b) Statutory Reserves.

     "Adjusted Eurocurrency Rate" means Adjusted LIBOR or Adjusted EURIBOR.

     "Adjusted LIBOR" shall mean, with respect to any LIBOR Borrowing for any
Interest Period, an interest rate per annum equal to the product of (a) the
LIBOR in effect for such Interest Period and (b) Statutory Reserves.

     "Administrative Agent Fees" shall have the meaning assigned to such term in
Section 2.05(b).

     "Administrative Questionnaire" shall mean an Administrative Questionnaire
in the form of Exhibit A, or such other form as may be supplied from time to
time by the Administrative Agent.

     "Affiliate" shall mean, when used 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; provided, however, that for purposes of Section 6.07, the term
"Affiliate" shall also include any person that directly or indirectly owns more
than 5% of any class of capital stock of the person specified or that is an
officer or director of the person specified.

     "Aggregate Revolving Credit Exposure" shall mean the aggregate amount of
the Lenders' Revolving Credit Exposures.

     "Agreement" shall mean this Credit Agreement as amended from time to time.

     "Agreement Currency" shall have the meaning assigned to such term in
Section 9.16(b).

     "Alternate Base Rate" shall mean, for any day, a rate per annum (rounded
upwards, if necessary, to the next 1/16 of 1%) equal to the greater of (a) the
Prime Rate in effect on such day and (b) the Federal Funds Ef-
<PAGE>

                                      -3-

fective Rate in effect on such day plus 1/2 of 1%. If the Administrative Agent
shall have determined (which determination shall be conclusive absent manifest
error) that it is unable to ascertain the Federal Funds Effective Rate for any
reason, including the inability or failure of the Administrative Agent to obtain
sufficient quotations in accordance with the terms of the definition thereof,
the Alternate Base Rate shall be determined without regard to clause (b) of the
preceding sentence until the circumstances giving rise to such inability no
longer exist. Any change in the Alternate Base Rate due to a change in the Prime
Rate or the Federal Funds Effective Rate shall be effective on the effective
date of such change in the Prime Rate or the Federal Funds Effective Rate,
respectively. The term "Prime Rate" shall mean the rate of interest per annum
publicly announced from time to time by the Administrative Agent as its prime
rate in effect at its principal office in New York City; each change in the
Prime Rate shall be effective on the date such change is publicly announced as
being effective. The term "Federal Funds Effective Rate" shall mean, for any
day, the weighted average of the rates on overnight Federal funds transactions
with members of the Federal Reserve System arranged by Federal funds brokers, as
published on the next succeeding Business Day by the Federal Reserve Bank of New
York, or, if such rate is not so published for any day that is a Business Day,
the average of the quotations for the day for such transactions received by the
Administrative Agent from three Federal funds brokers of recognized standing
selected by it.

     "Alternative Currency" means Euros and any other foreign currency which is
agreed to by the Borrower and the Lenders.

     "Alternative Currency Borrowing" means a Borrowing comprised of Alternative
Currency Loans.

     "Alternative Currency Equivalent" means, on any date of determination, with
respect to any amount denominated in Dollars, the equivalent in any Alternative
Currency of such amount, determined by Administrative Agent pursuant to Section
1.04 using the applicable Exchange Rate with respect to such currency at the
time in effect.

     "Alternative Currency Exposure" means, at any time with respect to any
Alternative Currency, the sum of the Dollar Equivalent of the aggregate
principal amount of all outstanding Loans that are denominated in such
Alternative Currency at such time.

     "Alternative Currency Loan" means any Loan denominated in an Alternative
Currency.  Each Alternative Currency Loan must be a Eurocurrency Rate Loan.

     "Alternative Currency Tranche A Term Loan" means a Tranche A Term Loan
denominated in an Alternative Currency.

     "Applicable Percentage" shall mean, for any day, with respect to any
Eurocurrency Loan or ABR Loan, as the case may be, the applicable percentage set
forth below under the caption "Eurocurrency Spread--Tranche A Term Loans and
Revolving Loans", "Eurocurrency Spread--Tranche B Term Loans" or "ABR Spread--
Tranche A Term Loans and Revolving Loans" or "ABR Spread--Tranche B Term Loans",
and "Unused Revolving Credit Commitment" as the case may be, based upon the
Leverage Ratio as of the relevant date of determination:

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                        Eurocurrency                ABR Spread
                           Spread              Tranche A Term Loans    Eurocurrency Spread    ABR Spread        Unused
       Leverage    Tranche A Term Loans and           and                  Tranche B           Tranche B     Revolving Credit
         Ratio         Revolving Loans           Revolving Loans          Term Loans          Term Loans       Commitment
 -----------------------------------------------------------------------------------------------------------------------------------
<S>                <C>                         <C>                     <C>                    <C>            <C>
</TABLE>
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                                      -4-

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                                Eurocurrency                ABR Spread
                                   Spread            Tranche A Term Loans      Eurocurrency Spread   ABR Spread          Unused
       Leverage           Tranche A Term Loans and           and                    Tranche B         Tranche B     Revolving Credit
         Ratio                 Revolving Loans           Revolving Loans            Term Loans       Term Loans        Commitment
 -----------------------------------------------------------------------------------------------------------------------------------
<S>                       <C>                        <C>                       <C>                   <C>            <C>
Category 1                         3.00%                     2.00%                 4.00%                3.00%              0.50%
----------
Equal to or greater than
4.25 to  1.00
------------------------------------------------------------------------------------------------------------------------------------
Category 2                         2.75%                     1.75%                 3.75%                2.75%              0.50%
----------
Equal to or greater than
3.50 to  1.00, but less
than 4.25 to 1.00
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Category 3                         2.50%                     1.50%                 3.50%                2.50%              0.50%
----------
Equal to or greater than
3.00 to  1.00, but less
than 3.50 to 1.00
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Category 4                         2.25%                     1.25%                 3.50%                2.50%             0.375%
----------
Equal to or greater than
2.50 to  1.00, but less
than 3.00 to 1.00
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Category 5                         2.00%                     1.00%                 3.50%                2.50%             0.375%
----------
Equal to or greater than
2.00 to  1.00, but less
than 2.50 to 1.00
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Category 6                         1.75%                     0.75%                 3.50%                2.50%             0.375%
----------
Equal to or greater than
1.75,  but less than 2.00
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Category 7                         1.50%                     0.50%                 3.50%                2.50%              0.25%
----------
Less than 1.75 to 1.00
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</TABLE>

     Each change in the Applicable Percentage resulting from a change in the
Leverage Ratio shall be effective with respect to all Loans and Letters of
Credit outstanding on and after the date of delivery to the Administrative Agent
of the financial statements and certificates required by Section 5.04(a) or (b)
and Section 5.04(c), respectively, indicating such change until the date
immediately preceding the next date of delivery of such financial statements and
certificates indicating another such change.  Notwithstanding the foregoing,
until such date as the Administrative Agent shall have received a compliance
certificate as required in Section 4.02(d) for the fiscal quarter ending
November 30, 2000, the Leverage Ratio shall be deemed to be in Category 2 for
purposes of determining the Applicable Percentage; provided, however, that at
any time during which the Borrower has failed to deliver the financial
statements and certificates required by Section 5.04(a) or (b) and Section
5.04(c), respectively, the Leverage Ratio shall be deemed to be in Category 1
for purposes of determining the Applicable Percentage.

     "Asset Sale" shall mean the sale, transfer or other disposition (by way of
merger or otherwise) by the Borrower or any of the Subsidiaries to any person
other than the Borrower or any Subsidiary Guarantor of (a) any capital stock of
any of the Subsidiaries (other than directors' qualifying shares or shares
required by applicable law to be held by a person other than the Borrower or a
Subsidiary) or (b) any other assets of the Bor
<PAGE>

                                      -5-

rower or any of the Subsidiaries (other than (i) inventory, excess, damaged,
obsolete or worn out equipment, scrap and Cash Equivalents, in each case
disposed of in the ordinary course of business and consistent with past
practices, (ii) dispositions resulting in Net Insurance Proceeds or Net
Condemnation Awards or (iii) dispositions between or among Foreign
Subsidiaries), provided that any asset sale or series of related asset sales
described in clause (b) above having a value not in excess of $750,000 shall be
deemed not to be an "Asset Sale" for purposes of this Agreement.

     "Assignment and Acceptance" shall mean an assignment and acceptance entered
into by a Lender and an assignee, and accepted by the Administrative Agent, in
the form of Exhibit B, or such other form as shall be approved by the
Administrative Agent.

     "Board" shall mean the Board of Governors of the Federal Reserve System of
the United States of America.

     "Board of Directors" means the Board of Directors of the Borrower or any
committee thereof authorized to act on behalf of such Board.

     "Borrower" shall mean the Company and any person who becomes a Subsidiary
Borrower pursuant to Section 2.24.

     "Borrowing" shall mean a group of Loans of a single Type made by the
Lenders on a single date and as to which a single Interest Period is in effect.

     "Borrowing Request" shall mean a request by the Borrower in accordance with
the terms of Section 2.03 and substantially in the form of Exhibit C-1, or such
other form as shall be approved by the Administrative Agent.

     "Business Day" means any day excluding Saturday, Sunday and any day which
is a legal holiday under the laws of the State of New York, or is a day on which
banking institutions located in such jurisdiction are authorized or required by
law or other governmental action to close; provided, however, that (i) when used
in connection with a Eurocurrency Rate Loan, the interest rate for which is
determined by reference to LIBOR, the term "Business Day" shall also exclude any
day on which banks are not open for dealings in deposits in the relevant
currency in the London interbank market, and (ii) when used in connection with a
Eurocurrency Rate Loan, the interest rate for which is determined by reference
to EURIBOR, the term "Business Day" shall also exclude any day which is not a
TARGET Settlement Day.

     "Capital Expenditures" shall mean, with respect to any person, all
expenditures by such person that should be capitalized in accordance with GAAP,
including all such expenditures with respect to fixed or capital assets
(including expenditures for maintenance and repairs that should be capitalized
in accordance with GAAP) and the amount of Capital Lease Obligations incurred by
such person.

     "Capital Lease Obligations" of any person shall mean 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.
<PAGE>

                                     -6-

     "Cash Equivalents" shall mean, as to any person, (a) securities issued or
directly and fully guaranteed or insured by the United States or any agency or
instrumentality thereof (provided that the full faith and credit of the United
States is pledged in support thereof) having maturities of not more than one
year from the date of acquisition by such person, (b) time deposits and
certificates of deposit of any commercial bank having, or which is the principal
banking subsidiary of a bank holding company organized under the laws of the
United States, any State thereof or the District of Columbia, having capital,
surplus and undivided profits aggregating in excess of $500,000,000 (or the
foreign currency equivalent thereof), with maturities of not more than one year
from the date of acquisition by such person, (c) repurchase obligations with a
term of not more than 30 days for underlying securities of the types described
in clause (a) above entered into with any bank meeting the qualifications
specified in clause (b) above, (d) commercial paper issued by any person
incorporated in the United States rated at least A-1 or the equivalent thereof
by Standard & Poor's Rating Service or at least P-1 or the equivalent thereof by
Moody's Investors Service, Inc., and in each case maturing not more than one
year after the date of acquisition by such person, (e) investments in money
market funds substantially all of whose assets are comprised of securities of
the types described in clauses (a) through (d) above and (f) demand deposit
accounts maintained in the ordinary course of business.

     "Casualty Event" shall mean, with respect to any Property (including Real
Property) of the Borrower or any of the Subsidiaries, any loss of title with
respect to Real Property or any Destruction or Taking (including by any
Governmental Authority) of such Property (including Real Property) for which the
Borrower or any of the Subsidiaries receives insurance proceeds or proceeds of a
condemnation award or other compensation.

     "Change in Control" shall be deemed to have occurred if (a) any "person"
(as such term is used in Sections 13(d) and 14(d) of the Exchange Act) is or
becomes the beneficial owner (as defined in Rules 13d-3 and 13d-5 under the
Exchange Act, except that for purposes of this clause (a) such person shall be
deemed to have "beneficial ownership" of all shares that any such person has the
right to acquire, whether such right is exercisable immediately or only after
the passage of time), directly or indirectly, of more than 50% of the total
voting power of the Voting Stock of the Borrower (for the purpose of this clause
(a) a Person shall be deemed to beneficially own the Voting Stock of a
corporation that is beneficially owned (as defined above) by another corporation
(a "parent corporation") if such Person beneficially owns (as defined above) at
least 50% of the aggregate voting power of all classes of Voting Stock of such
parent corporation); (b) during any period of two consecutive years, individuals
who at the beginning of such period constituted the Board of Directors (together
with any new directors whose election by such Board of Directors or whose
nomination for election by the shareholders of the Borrower was approved by a
vote of 66-2/3% of the directors of the Borrower then still in office who were
either directors at the beginning of such period or whose election or nomination
for election was previously so approved) cease for any reason to constitute a
majority of the Board of Directors then in office; (c) the adoption of a plan
relating to the liquidation or dissolution of the Borrower; or (d) the merger or
consolidation of the Borrower with or into another Person or the merger of
another Person with or into the Borrower, or the sale of all or substantially
all the assets of the Company to another Person (notwithstanding compliance with
the provisions of Section 6.05), and, in the case of any such merger or
consolidation, the securities of the Company that are outstanding immediately
prior to such transaction and which represent 100% of the aggregate voting power
of the Voting Stock of the Borrower are changed into or exchanged for cash,
securities or property, unless pursuant to such transaction such securities are
changed into or exchanged for, in addition to any other consideration,
securities of the surviving corporation that represent immediately after such
transaction, at least a majority of the aggregate voting power of the Voting
Stock of the surviving corporation.

     "Closing Date" shall mean the date on which the first Credit Event shall
have occurred.

     "Code" shall mean the Internal Revenue Code of 1986, as amended from time
to time.
<PAGE>

                                      -7-

     "Collateral" shall mean all of the Pledged Collateral, the Mortgaged
Property and all other Property of whatever kind and nature pledged as
collateral under any Security Document.

     "Collateral Account" shall have the meaning assigned to such term in the
Security Agreement.

     "Collateral Agent" shall have the meaning assigned to such term in the
preamble hereof.

     "Commitment" shall mean, with respect to any Lender, such Lender's
Revolving Credit Commitment (including any Swingline Commitment), or Term Loan
Commitment.

     "Commitment Fee" shall have the meaning assigned to such term in Section
2.05(a).

     "Company" shall have the meaning assigned to such term in the preamble
hereof.

     "Confidential Information Memorandum" shall mean the Confidential
Information Memorandum of the Borrower dated July 21, 2000.

     "Consolidated Current Assets" shall mean, at any time, the consolidated
current assets (other than cash and Cash Equivalents) of the Borrower and its
consolidated Subsidiaries.

     "Consolidated Current Liabilities" shall mean, at any time, the
consolidated current liabilities of the Borrower and its consolidated
Subsidiaries at such time, but excluding (a) the current portion of any
Indebtedness under this Agreement and any other long-term Indebtedness which
would otherwise be included therein, (b) accrued but unpaid interest with
respect to the Indebtedness described in clause (a), and (c) the current portion
of Indebtedness constituting Capital Lease Obligations.

     "Consolidated EBITDA" shall mean, for any period, the sum of the amounts
for such period of (i) Consolidated Net Income, (ii) Consolidated Interest
Expense, (iii) provision for taxes based on income, (iv) total depreciation
expense, and (v) total amortization expense, in each case without giving effect
to any extraordinary gains or losses or gains or losses from sales of assets
other than inventory sold in the ordinary course of business; provided, however,
that amounts in any such period in respect of (v) any noncash charges associated
with the sales of assets set forth on Schedule 2.13(b) hereto, (w) the write-off
of deferred financing fees and any premium actually paid in connection with the
Transactions, (x) contract termination costs actually paid in connection with
the Transactions, (y) restructuring charges actually paid in connection with the
Transactions, and (z) corporate reorganization expenses actually paid in
connection with the Transactions shall be added to Consolidated EBITDA for such
period; provided, further, however, that (A) for any such period prior to the
Closing Date, Consolidated EBITDA shall be calculated on a pro forma basis for
the Divestitures and Spin-Off; and (B) in the case of any determination that
includes one or more fiscal quarters ending prior to the Closing Date, an amount
equal to the actual general corporate expenses for each such fiscal quarter in
excess of $1.25 million for each such fiscal quarter shall be added to
Consolidated EBITDA, all of the foregoing as determined on a consolidated basis
for the Borrower and the Subsidiaries in conformity with GAAP.

     "Consolidated Fixed Charge Coverage Ratio" for any period shall mean the
ratio of the excess of Consolidated EBITDA over Capital Expenditures to
Consolidated Fixed Charges for such period.

     "Consolidated Fixed Charges" for any period shall mean the sum, without
duplication, of (a) the cash portion of Consolidated Interest Expense for such
period, (b) income taxes expense for such period and (c) the scheduled principal
amount of all amortization payments on all Indebtedness (including the principal
component
<PAGE>

                                      -8-

of all Capital Lease Obligations) of the Borrower and its Subsidiaries for such
period (as determined on the first day of the respective period).

     "Consolidated Indebtedness" shall mean, as at any date of determination,
the aggregate stated balance sheet amount of all Indebtedness (but including in
any event the then outstanding principal amount of all Loans, all New Senior
Subordinated Notes and all Capital Lease Obligations) of the Borrower and the
Subsidiaries on a consolidated basis as determined in accordance with GAAP;
provided that Indebtedness outstanding pursuant to trade payables and accrued
expenses incurred in the ordinary course of business shall be excluded in
determining Consolidated Indebtedness.

     "Consolidated Interest Coverage Ratio" shall mean, for any period, the
ratio of (i) Consolidated EBITDA for such period to (ii) Consolidated Interest
Expense for such period.

     "Consolidated Interest Expense" shall mean, for any period, the total
consolidated interest expense of the Borrower and its consolidated Subsidiaries
for such period (calculated without regard to any limitations on the payment
thereof) plus, without duplication, the portion of Capital Lease Obligations of
the Borrower and its consolidated Subsidiaries representing the interest factor
for such period.

     "Consolidated Net Income" shall mean, for any period, the consolidated net
after tax income of the Borrower and its consolidated Subsidiaries (other than
net income of Subsidiaries that are not Wholly Owned Subsidiaries to the extent
such income for such period has not been paid to the Borrower by dividend or
otherwise) determined in accordance with GAAP.

     "Contingent Obligation" shall mean, as to any person, any obligation of
such person guaranteeing or intended to guarantee any Indebtedness, leases,
dividends or other obligations ("primary obligations") of any other person (the
"primary obligor") in any manner, whether directly or indirectly, including,
without limitation, any obligation of such person, whether or not contingent,
(a) to purchase any such primary obligation or any property constituting direct
or indirect security therefor, (b) to advance or supply funds (i) for the
purchase or payment of any such primary obligation or (ii) to maintain working
capital or equity capital of the primary obligor or otherwise to maintain the
net worth or solvency of the primary obligor, (c) to purchase property,
securities or services primarily for the purpose of assuring the owner of any
such primary obligation of the ability of the primary obligor to make payment of
such primary obligation or (d) otherwise to assure or hold harmless the holder
of such primary obligation against loss in respect thereof; provided, however,
that the term Contingent Obligation shall not include endorsements of
instruments for deposit or collection in the ordinary course of business and any
products warranties for deposit or collection in the ordinary course of
business.  The amount of any Contingent Obligation shall be deemed to be an
amount equal to the stated or determinable amount of the primary obligation in
respect of which such Contingent Obligation is made (or, if less, the maximum
amount of such primary obligation for which such person may be liable pursuant
to the terms of the instrument evidencing such Contingent Obligation) or, if not
stated or determinable, the maximum reasonably anticipated liability in respect
thereof (assuming such person is required to perform thereunder) as determined
by such person in good faith.

     "Control" shall mean 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 ownership of voting securities, by contract or otherwise,
and the terms "Controlling" and "Controlled" shall have meanings correlative
thereto.

     "Credit Event" shall have the meaning assigned to such term in Section
4.01.
<PAGE>

                                      -9-

     "Default" shall mean any event or condition which upon notice, lapse of
time or both would constitute an Event of Default.

     "Designated Senior Indebtedness" shall have the meaning given such term in
the New Senior Subordinated Note Indenture.

     "Destruction" shall mean any and all damage to, or loss or destruction of,
any Property of the Borrower or any of the Subsidiaries or any part thereof.

     "Disqualified Capital Stock" shall mean any capital stock which, by its
terms (or by the terms of any security into which it is convertible or for which
it is exchangeable), or upon the happening of any event, (a) matures (excluding
any maturity as the result of an optional redemption by the issuer thereof) or
is mandatorily redeemable, pursuant to a sinking fund obligation or otherwise,
or is redeemable at the option of the holder thereof, in whole or in part, on or
prior to the first anniversary of the Tranche B Maturity Date, or (b) is
convertible into or exchangeable (unless at the sole option of the issuer
thereof) for (i) debt securities or (ii) any capital stock referred to in (a)
above, in each case at any time prior to the first anniversary of the Tranche B
Maturity Date.

     "Divestitures" shall mean the sale by the Borrower of its vibration control
business, known as Barry Controls, and its aerospace cargo products business,
known as Air Cargo.

     "Dividend" with respect to any person shall mean that such person has
declared or paid a dividend or returned any equity capital to its stockholders
or authorized or made any other distribution, payment or delivery of property
(other than common stock of such person) or cash to its stockholders as such, or
redeemed, retired, purchased or otherwise acquired, directly or indirectly, for
a consideration any shares of any class of its capital stock outstanding on or
after the Closing Date (or any options or warrants issued by such person with
respect to its capital stock), or set aside any funds for any of the foregoing
purposes, or shall have permitted any of its Subsidiaries to purchase or
otherwise acquire for a consideration any shares of any class of the capital
stock of such person outstanding on or after the Closing Date (or any options or
warrants issued by such person with respect to its capital stock).  Without
limiting the foregoing, "Dividends" with respect to any person shall also
include all payments made or required to be made by such person with respect to
any stock appreciation rights, plans, equity incentive or achievement plans or
any similar plans or setting aside of any funds for the foregoing purposes.

     "Dollar Borrowing" means a Borrowing comprised of Dollar Loans.

     "Dollar Equivalent" means, on any date of determination, with respect to
any amount denominated in any currency other than Dollars, the equivalent in
dollars of such amount, determined by Administrative Agent pursuant to Section
1.04 using the applicable Exchange Rate with respect to such currency at the
time in effect.

     "Dollar Loan" means any Loan denominated in dollars.

     "Dollars" or "$" shall mean lawful money of the United States of America.

     "Domestic Subsidiaries" shall mean all Subsidiaries incorporated or
organized under the laws of the United States of America, any State thereof, the
District of Columbia, the United States Virgin Islands or Puerto Rico.
<PAGE>

                                     -10-

     "EC Treaty" means the Treaty establishing the European Community (signed in
Rome on March 25, 1957), as amended by the Treaty on European Union (signed in
Maastricht on February 7, 1992).

     "environment" shall mean ambient air, surface water and groundwater
(including potable water, navigable water and wetlands), the land surface or
subsurface strata, natural resources, the workplace or as otherwise defined in
any Environmental Law.

     "Environmental Claim" shall mean any written accusation, allegation, notice
of violation, claim, demand, order, directive, cost recovery action or other
cause of action by, or on behalf of, any Governmental Authority or any person
for damages, injunctive or equitable relief, personal injury (including
sickness, disease or death), Remedial Action costs, tangible or intangible
property damage, natural resource damages, nuisance, pollution, any adverse
effect on the environment caused by any Hazardous Material, or for fines,
penalties or restrictions, resulting from or based upon (a) the existence, or
the continuation of the existence, of a Release (including sudden or non-sudden,
accidental or non-accidental Releases), (b) exposure to any Hazardous Material,
(c) the presence, use, handling, transportation, storage, treatment or disposal
of any Hazardous Material or (d) the violation or alleged violation of any
Environmental Law or Environmental Permit.

     "Environmental Law" shall mean the common law and any and all applicable
present and future treaties, laws, rules, regulations, codes, ordinances,
orders, decrees, judgments, injunctions or binding agreements issued,
promulgated or entered into by any Governmental Authority, relating in any way
to the environment, preservation or reclamation of or damages to natural
resources, the management, Release or threatened Release of any Hazardous
Material or to health and safety matters now or hereafter in effect, including
without limitation the Comprehensive Environmental Response, Compensation and
Liability Act of 1980, as amended by the Superfund Amendments and
Reauthorization Act of 1986, 42 U.S.C. (S) 9601 et seq. (collectively "CERCLA"),
the Solid Waste Disposal Act, as amended by the Resource Conservation and
Recovery Act of 1976 and Hazardous and Solid Waste Amendments of 1984, 42 U.S.C.
(S) 6901 et seq., the Federal Water Pollution Control Act, as amended by the
Clean Water Act of 1977, 33 U.S.C. (S) 1251 et seq., the Clean Air Act of 1970,
as amended 42 U.S.C. (S) 7401 et seq., the Toxic Substances Control Act of 1976,
15 U.S.C. (S) 2601 et seq., the Occupational Safety and Health Act of 1970, as
amended, 29 U.S.C. (S) 651 et seq., the Emergency Planning and Community Right-
to-Know Act of 1986, 42 U.S.C. (S) 11001 et seq., the Safe Drinking Water Act of
1974, as amended, 42 U.S.C. (S) 300(f) et seq., the Hazardous Materials
Transportation Act, 49 U.S.C. (S) 5101 et seq., and any similar or implementing
state, local or foreign law, and all amendments or regulations promulgated under
any of the foregoing.

     "Environmental Permit" shall mean any permit, approval, authorization,
certificate, license, variance, filing or permission required by or from any
Governmental Authority pursuant to any Environmental Law.

     "Equity Interest" shall mean, with respect to any person, any and all
shares, interests, participations or other equivalents, including membership
interests (however designated, whether voting or non-voting), of capital of such
person, including, if such person is a partnership, partnership interests
(whether general or limited) and 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, such partnership, whether outstanding on the date
hereof or issued hereafter.

     "Equity Offering" shall mean any offering of capital stock of, and by, the
Borrower other than (i) an issuance made as consideration for an acquisition
permitted pursuant to Section 6.04(j) and (ii) issuances pursuant to employee
stock ownership plans of the Borrower or the Subsidiaries.
<PAGE>

                                     -11-

     "ERISA" shall mean the Employee Retirement Income Security Act of 1974, as
the same may be amended from time to time.

     "ERISA Affiliate" shall mean any trade or business (whether or not
incorporated) that, together with the Borrower, is treated as a single employer
under Section 414(b) or (c) of the Code, or solely for purposes of Section 302
of ERISA and Section 412 of the Code, is treated as a single employer under
Section 414 of the Code.

     "ERISA Event" shall mean (a) any "reportable event", as defined in Section
4043 of ERISA or the regulations issued thereunder, with respect to a Plan
(other than an event for which the 30-day notice period is waived); (b) 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; (c) the filing pursuant to Section 412(d) of the Code or Section 303(d)
of ERISA of an application for a waiver of the minimum funding standard with
respect to any Plan; (d) the incurrence by the Borrower or any of its ERISA
Affiliates of any liability under Title IV of ERISA with respect to the
termination of any Plan; (e) the receipt by the Borrower or any of its ERISA
Affiliates from the PBGC or a plan administrator of any notice relating to the
intention to terminate any Plan or Plans or to appoint a trustee to administer
any Plan; (f) the incurrence by the Borrower or any of its ERISA Affiliates of
any liability with respect to the withdrawal from any Plan or Multiemployer
Plan; (g) the receipt by the Borrower or any of its ERISA Affiliates of any
notice, or the receipt by any Multiemployer Plan from the Borrower or any of its
ERISA Affiliates of any notice, concerning the imposition of Withdrawal
Liability or a determination that a Multiemployer Plan is, or is expected to be,
insolvent or in reorganization, within the meaning of Title IV of ERISA; and (h)
any Foreign Benefit Event.

     "EURIBOR" means, with respect to any EURIBOR Borrowing for any Interest
Period (i) the rate per annum as determined by Administrative Agent at
approximately 11:00 a.m. Brussels time on the date which is two Business Days
prior to the beginning of such Interest Period by reference to the Reuters Page
EURIBOR-01 for deposits in Euros for a period equal to such Interest Period or
(ii) to the extent that an interest rate is not ascertainable pursuant to the
foregoing provisions of this definition, "EURIBOR" shall be the interest rate
per annum determined by Administrative Agent equal to the rate per annum at
which deposits in Euros are offered for such Interest Period by Administrative
Agent in the Euro-zone interbank market at approximately 11:00 a.m., Brussels
time, on the date which is two Business Days prior to the beginning of such
Interest Period.

     "EURIBOR Borrowing" means any Borrowing consisting of EURIBOR Term Loans.

     "EURIBOR Term Loan" means a Tranche A Term Loan bearing interest at rates
determined by reference to Adjusted EURIBOR as provided in Section 2.06(c).

     "Euro" and "Euro" mean the lawful currency of the member states (as such
term is used in Council Regulation (EC) No. 974/98) of the European Union that
adopt the single currency in accordance with the EC Treaty.

     "Eurocurrency Rate" means EURIBOR or LIBOR.

     "Eurocurrency Rate Borrowing" means a Borrowing comprised of Eurocurrency
Rate Loans.

     "Eurocurrency Rate Loans" means Loans bearing interest at rates determined
by reference to an Adjusted Eurocurrency Rate as provided in the definition of
Applicable Percentage.
<PAGE>

                                     -12-

     "Eurocurrency Term Loans" shall mean Term Loans bearing interest at rates
determined by reference to an Adjusted Eurocurrency Rate as provided in the
definition of Applicable Percentage.

     "Euro-zone" means the region comprised of member states of the European
Union that adopt the single currency in accordance with the EC Treaty.

     "Event of Default" shall have the meaning assigned to such term in Article
VII.

     "Excess Cash Flow" shall mean, for any fiscal year of the Borrower, the
excess of (a) the sum, without duplication, of (i) Consolidated EBITDA for such
fiscal year, (ii) extraordinary cash receipts of the Borrower and its
consolidated Subsidiaries, if any, during such fiscal year and not included in
Consolidated EBITDA and (iii) reductions to noncash working capital of the
Borrower and its consolidated Subsidiaries for such fiscal year (i.e., the
decrease, if any, in Consolidated Current Assets minus Consolidated Current
Liabilities from the beginning to the end of such fiscal year) over (b) the sum,
without duplication, of (i) the amount of any cash income taxes payable by the
Borrower and its consolidated Subsidiaries with respect to such fiscal year,
(ii) scheduled cash interest paid (net of cash interest received) by the
Borrower and its consolidated Subsidiaries during such fiscal year, (iii)
Capital Expenditures made in cash in accordance with Section 6.08 during such
fiscal year, except to the extent financed with the proceeds of Indebtedness,
Net Insurance Proceeds or Net Condemnation Awards, (iv) scheduled permanent
repayments of Indebtedness made by the Borrower and its consolidated
Subsidiaries during such fiscal year, (v) mandatory prepayments of the Revolving
Loans during such fiscal year, but only to the extent that such prepayments by
their terms cannot be reborrowed or redrawn and do not occur in connection with
a refinancing of all or any portion of the Revolving Loans, and (vi) additions
to noncash working capital for such fiscal year (i.e., the increase, if any, in
Consolidated Current Assets minus Consolidated Current Liabilities from the
beginning to the end of such fiscal year); provided that, to the extent
otherwise included therein, the Net Cash Proceeds of Asset Sales and
dispositions resulting in Net Insurance Proceeds or Net Condemnation Awards
shall be excluded from the calculation of Excess Cash Flow.

     "Exchange Act" shall mean the Securities Exchange Act of 1934, as amended.

     "Exchange Rate" means, on any day, with respect to any currency other than
dollars (for purposes of determining the Dollar Equivalent) or any Alternative
Currency (for purposes of determining the Alternative Currency Equivalent with
respect to dollars or another Alternative Currency, as the case may be), the
rate (for spot delivery) at which such currency may be exchanged into dollars or
the applicable Alternative Currency, as the case may be, as set forth at
approximately 11:00 a.m., New York City time, on such date as the Administrative
Agent shall have received a Borrowing Request on the applicable Bloomberg Key
Cross Currency Rates Page.  In the event that any such rate does not appear on
any Bloomberg Key Cross Currency Rates Page, the Exchange Rate shall be
determined by reference to such other publicly available service for displaying
exchange rates reasonably selected by Administrative Agent for such purpose, or,
at the reasonable discretion of Administrative Agent, such Exchange Rate shall
instead be the arithmetic average of the spot rates of exchange of
Administrative Agent in the market where its foreign currency exchange
operations in respect of such currency are then being conducted, at or about
10:00 a.m., local time, on such date for the purchase of dollars or the
applicable Alternative Currency, as the case may be, for delivery two Business
Days (or such other period as is customary in the relevant market) later;
provided that, if at the time of any such determination, for any reason, no such
spot rate is being quoted, Administrative Agent may use any other reasonable
method it deems appropriate to determine such rate, and such determination shall
be presumed correct absent manifest error.

     "Excluded Taxes" shall mean, with respect to the Administrative Agent, any
Lender, the Issuing Bank or any other recipient of any payment to be made by or
on account of any obligation of the Borrower hereunder,
<PAGE>

                                     -13-

(a) income or franchise taxes imposed on (or measured by) its net income by the
United States of America, or by the jurisdiction under the laws of which such
recipient is organized or in which its principal office is located or, in the
case of any Lender, in which its applicable lending office is located, (b) any
branch profits taxes imposed by the United States of America or any similar tax
imposed by any other jurisdiction in which the Borrower is located and (c) in
the case of a Foreign Lender (other than an assignee pursuant to a request by
the Borrower under Section 2.21(a)), any withholding tax that is imposed on
amounts payable to such Foreign Lender at the time such Foreign Lender becomes a
party to this Agreement (or designates a new lending office) or is attributable
to such Foreign Lender's failure to comply with Section 2.20(e), except to the
extent that such Foreign Lender (or its assignor, if any) was entitled, at the
time of designation of a new lending office (or assignment), to receive
additional amounts from the Borrower with respect to such withholding tax
pursuant to Section 2.20(a).

     "Existing Senior Subordinated Notes" shall mean the Borrower's 8-3/4%
Senior Subordinated Notes due 2009 issued pursuant to the indenture dated as of
April 1, 1999, between the Borrower and The First National Bank of Chicago, as
trustee.

     "Fee Letter" shall mean the Senior Secured Credit Facilities Fee Letter
dated May 30, 2000, between the Borrower and the Agents.

     "Fees" shall mean the Commitment Fees, the Administrative Agent's Fees, the
L/C Participation Fees and the Issuing Bank Fees.

     "Financial Officer" of any corporation shall mean the chief financial
officer, principal accounting officer, Treasurer or Controller of such
corporation.

     "fiscal quarter" shall mean a quarter ending on the last day of each
February, May, August and November.

     "Foreign Lender" shall mean any Lender that is organized under the laws of
a jurisdiction other than that in which the Borrower is located. For purposes of
this definition, the United States of America, each State thereof and the
District of Columbia shall be deemed to constitute a single jurisdiction.

     "Foreign Pension Plan" shall mean any plan, fund (including any
superannuation fund) or other similar program established or maintained outside
the United States by the Borrower or any one or more of its Subsidiaries
primarily for the benefit of employees of the Borrower or such Subsidiaries
residing outside the United States, which plan, fund or other similar program
provides, or results in, retirement income, a deferral of income in
contemplation of retirement or payments to be made upon termination of
employment, and which plan is not subject to ERISA or the Code.

     "Foreign Subsidiary" shall mean any Subsidiary that is not a Domestic
Subsidiary.

     "GAAP" shall mean generally accepted accounting principles applied on a
consistent basis.

     "Governmental Authority" shall mean any Federal, state, local or foreign
court or governmental agency, authority, instrumentality or regulatory body.

     "Governmental Real Property Disclosure Requirements" shall mean any
Requirement of Law of any Governmental Authority requiring notification of the
buyer or mortgagee of Real Property, or notification, registration or filing to
or with any Governmental Authority, prior to the sale or mortgage of any Real
Property or
<PAGE>

                                     -14-

transfer of control of an establishment, of the actual or threatened presence or
release into the environment, or the use, disposal or handling of Hazardous
Material on, at, under or near the Real Property to be sold or the establishment
for which control is to be transferred.

     "Granting Lender" has the meaning specified in Section 9.04(i).

     "Hazardous Materials" shall mean all explosive or radioactive substances or
wastes, hazardous or toxic substances or wastes, pollutants, solid, liquid or
gaseous wastes, including petroleum or petroleum distillates, asbestos or
asbestos containing materials, polychlorinated biphenyls ("PCBs") or PCB-
containing materials or equipment, radon gas, infectious or medical wastes and
all other substances, materials or wastes of any nature or form regulated
pursuant to any Environmental Law.

     "Indebtedness" of any person shall mean, without duplication, (a) all
obligations of such person for borrowed money 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 or assets purchased by such person other than customary reservations of
title under agreements with suppliers or lessors entered into in the ordinary
course of business, (e) all obligations of such person issued or assumed as the
deferred purchase price of property or services (excluding trade accounts
payable and accrued obligations 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
obligations secured thereby have been assumed, (g) all Contingent Obligations of
such person, (h) all Capital Lease Obligations of such person, (i) all
obligations of such person in respect of interest rate protection agreements,
foreign currency exchange agreements or other interest or exchange rate hedging
arrangements, (j) all outstanding obligations of such person as an account party
in respect of letters of credit and bankers' acceptances, and (k) all
Disqualified Capital Stock issued by such person with the amount of Indebtedness
represented by such Disqualified Capital Stock being deemed to be the greater of
its voluntary or involuntary liquidation preference and its maximum repurchase
price, including accrued and unpaid dividends.  The Indebtedness of any person
shall include the Indebtedness of any partnership in which such person is a
general partner.

     "Indemnified Taxes" shall mean Taxes other than Excluded Taxes.

     "Indemnity, Subrogation and Contribution Agreement" shall mean the
Indemnity, Subrogation and Contribution Agreement, substantially in the form of
Exhibit D, among the Borrower, the Subsidiary Guarantors and the Collateral
Agent.

     "Interest Payment Date" means (i) with respect to any ABR Loan, the last
Business Day of each March, June, September and December of each year,
commencing on the first such date after the Closing Date, and (ii) with respect
to any Eurocurrency Rate Loan, the last day of each Interest Period applicable
to such Loan; provided that, in the case of each Interest Period of longer than
three months, "Interest Payment Date" shall also include each date that is three
months, or an integral multiple thereof, after the commencement of such Interest
Period.

     "Interest Period" shall mean (a) in connection with each Eurocurrency Rate
Loan, a period the Borrower selects pursuant to the applicable Borrowing Request
or Notice of Conversion/Continuation applicable to such Loan, which Interest
Period shall be, at the Borrowers' option, either a one, three or six month
period or, if deposits in the relevant Eurocurrency interbank market are
available to all Lenders for such period (as deter-
<PAGE>

                                     -15-

mined by each Lender in its sole discretion), a nine or twelve month period
(and, in the case of a Eurocurrency Rate Loan maturing or required to be repaid
in less than one month, the date thereafter requested by the applicable Borrower
and agreed to by Administrative Agent and Lenders) and (b) as to any ABR Loan,
the period commencing on the date of such Borrowing and ending on the earlier of
(i) the next succeeding last Business Day of March, June, September or December,
and (ii) the Revolving Credit Maturity Date, the Tranche A Maturity Date, the
Tranche B Maturity Date or the Tranche C Maturity Date, as applicable; provided
that: (i) the initial Interest Period for any Eurocurrency Rate Loan shall
commence on the initial date of Borrowing in respect of such Loan, in the case
of a Loan initially made as a Eurocurrency Rate Loan, or on the date specified
in the applicable Notice of Conversion/Continuation, in the case of a Loan
converted to a Eurocurrency Rate Loan; (ii) in the case of immediately
successive Interest Periods applicable to a Eurocurrency Rate Loan continued as
such pursuant to a Notice of Conversion/Continuation, each successive Interest
Period shall commence on the day on which the next preceding Interest Period
expires; (iii) if an Interest Period would otherwise expire on a day that is not
a Business Day, such Interest Period shall expire on the next succeeding
Business Day; provided that, if any Interest Period would otherwise expire on a
day that is not a Business Day but is a day of the month after which no further
Business Day occurs in such month, such Interest Period shall expire on the next
preceding Business Day; (iv) any Interest Period that begins on the last
Business Day of a calendar month (or on a day for which there is no numerically
corresponding day in the calendar month at the end of such Interest Period)
shall, subject to clauses (v) and (vi) below end on the last Business Day of a
calendar month; (v) no Interest Period with respect to any portion of the
Tranche A Term Loans shall extend beyond the Tranche A Term Loan Maturity Date,
no Interest Period with respect to any portion of the Tranche B Term Loans shall
extend beyond the Tranche B Term Loan Maturity Date, no Interest Period with
respect to any portion of the Revolving Loans shall extend beyond the Revolving
Credit Maturity Date and no Interest Period with respect to the Tranche C Term
Loan shall extend beyond the Tranche C Maturity Date; (vi) no Interest Period
with respect to any portion of the Term Loans shall extend beyond a date on
which the Borrower is required to make a scheduled payment of principal of such
Term Loans Type, unless the sum of (a) the aggregate principal amount of Term
Loans of the Type to be repaid that are ABR Loans plus (b) the aggregate
principal amount of Term Loans of the Type to be repaid that are Eurocurrency
Rate Loans with Interest Periods expiring on or before such date equals or
exceeds the principal amount required to be paid on the Term Loans of such Type
on such date; (vii) there shall be no more than 12 Eurocurrency Rate Loans
outstanding at any time; and (viii) in the event the Borrower fails to specify
an Interest Period for any Eurocurrency Rate Loan in the applicable Notice of
Borrowing or Notice of Conversion/Continuation, the Borrower shall be deemed to
have selected an Interest Period of one month. Interest shall accrue from and
including the first day of an Interest Period to but excluding the last day of
such Interest Period.

     "Interest Rate Determination Date" means, with respect to any Interest
Period in connection with each Eurocurrency Rate Loan the second Business Day
prior to the first day of such Interest Period.

     "Interest Rate Protection Agreement" shall mean any interest rate swap
agreement, interest rate cap agreement, interest rate collar agreement or
similar agreement or arrangement designed to protect the Borrower or any of the
Subsidiaries against fluctuations in interest rates, and not entered into for
speculation.

     "Issuing Bank" shall mean, as the context may require, (a) Credit Suisse
First Boston, with respect to Letters of Credit issued by it and (b) any other
Lender that may become an Issuing Bank pursuant to Section 2.23(i) or (k), with
respect to Letters of Credit issued by such Lender, or (c) collectively, all the
foregoing.

     "Issuing Bank Fees" shall have the meaning assigned to such term in Section
2.05(c).
<PAGE>

                                      -16-

     "L/C Commitment" shall mean the commitment of the Issuing Bank to issue
Letters of Credit pursuant to Section 2.23.

     "L/C Disbursement" shall mean a payment or disbursement made by the Issuing
Bank pursuant to a Letter of Credit.

     "L/C Exposure" shall mean at any time the sum of (a) the aggregate undrawn
amount of all outstanding Letters of Credit at such time plus (b) the aggregate
principal amount of all L/C Disbursements that have not yet been reimbursed at
such time.  The L/C Exposure of any Revolving Credit Lender at any time shall
mean its Pro Rata Share of the aggregate L/C Exposure at such time.

     "L/C Participation Fee" shall have the meaning assigned to such term in
Section 2.05(c).

     "Lenders" shall mean (a) the financial institutions listed on Schedule 2.01
(other than any such financial institution that has ceased to be a party hereto
pursuant to an Assignment and Acceptance) and (b) any financial institution that
has become a party hereto pursuant to an Assignment and Acceptance.  Unless the
context clearly indicates otherwise, the term "Lenders" shall include the
Swingline Lender.

     "Letter of Credit" shall mean any letter of credit issued pursuant to
Section 2.23.

     "Leverage Ratio" shall mean, at any date of determination, the ratio of
Consolidated Indebtedness on such date to Consolidated EBITDA for the period of
four consecutive fiscal quarters of the Borrower most recently ended as of such
date.  Solely for purposes of this definition, if at any time the Leverage Ratio
is being determined the Borrower or any Subsidiary shall have completed a
Permitted Acquisition or an Asset Sale since the beginning of the relevant four
fiscal quarter period, the Leverage Ratio shall be determined on a pro forma
basis as if such Permitted Acquisition or Asset Sale, and any related incurrence
or repayment of Indebtedness, had occurred at the beginning of such period.

     "LIBOR" shall mean, with respect to any LIBOR Borrowing for any Interest
Period, the rate per annum determined by the Administrative Agent at
approximately 11:00 a.m. (London time) on the date that is two Business Days
prior to the beginning of the relevant Interest Period by reference to the
British Bankers' Association Interest Settlement Rates for deposits in Dollars
(as set forth by the Bloomberg Information Service or any successor thereto or
any other service selected by the Administrative Agent which has been nominated
by the British Bankers' Association as an authorized information vendor for the
purpose of displaying such rates) for a period equal to such Interest Period;
provided that, to the extent that an interest rate is not ascertainable pursuant
to the foregoing provisions of this definition, the "LIBOR" shall be the
interest rate per annum determined by the Administrative Agent to be the average
of the rates per annum at which deposits in Dollars are offered for such
relevant Interest Period to major banks in the London interbank market in
London, England by the Administrative Agent at approximately 11:00 a.m. (London
time) on the date that is two Business Days prior to the beginning of such
Interest Period.

     "LIBOR Borrowing" shall mean a Borrowing comprised of LIBOR Loans.

     "LIBOR Loan" shall mean any LIBOR Revolving Loan or LIBOR Term Loan.

     "LIBOR Revolving Loan" shall mean any Revolving Loan bearing interest at a
rate determined by reference to the Adjusted LIBOR in accordance with the
provisions of Article II.
<PAGE>

                                      -17-

     "LIBOR Term Borrowing" shall mean a Borrowing comprised of LIBOR Term
Loans.

     "LIBOR Term Loan" shall mean any Term Loan bearing interest at a rate
determined by reference to the Adjusted LIBOR in accordance with the provisions
of Article II.

     "Lien" shall mean, with respect to any Property, (a) any mortgage, deed of
trust, lien, pledge, claim, charge, assignment, hypothecation, security interest
or encumbrance of any kind or nature, any other type of preferential arrangement
in respect of such Property or any filing of any financing statement signed by
the applicable Loan Party under the UCC or any other similar notice of Lien
under any similar notice or recording statute of any Governmental Authority,
including any easement, right-of-way or other encumbrance on title to Real
Property, in each of the foregoing cases whether voluntary or imposed by law,
and any agreement to give any of the foregoing, (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 Property and (c) in the case of
securities, any purchase option, call or similar right of a third party with
respect to such securities.

     "Loan Documents" shall mean this Agreement, the Letters of Credit, the
Subsidiary Guarantee Agreements, the Security Documents and the Indemnity,
Subrogation and Contribution Agreement.

     "Loan Parties" shall mean the Borrower and the Subsidiary Guarantors and
any Subsidiary Borrowers and any Subsidiary of the foregoing party to any
Security Document.

     "Loans" shall mean the Revolving Loans, the Term Loans and the Swingline
Loans.

     "Margin Stock" shall have the meaning assigned to such term in Regulation
U.

     "Material Adverse Effect" shall mean (a) a materially adverse effect on the
business, Property, results of operations, prospects or condition, financial or
otherwise, of the Borrower and the Subsidiaries, taken as a whole, (b) material
impairment of the ability of the Loan Parties to perform any of their
obligations under the Loan Documents or (c) material impairment of the rights of
or benefits or remedies available to the Lenders or the Collateral Agent under
any Loan Document.

     "Mortgage" shall mean an agreement, including, but not limited to, a fee or
leasehold mortgage, deed of trust or any other document acceptable to the
Collateral Agent, creating and evidencing a Lien on a Mortgaged Property, which
shall be substantially in the form of Exhibit E 1 or Exhibit E 2, as
                                      -----------    -----------
appropriate, with such schedules and including such additional provisions and
other deviations from such Exhibit or form as shall be necessary to conform such
document to applicable Requirements of Law or as shall be customary under such
applicable Requirements of Law, as the same may at any time be amended in
accordance with the terms thereof and hereof.

     "Mortgaged Property" shall mean the Real Property of the Loan Parties
specified on Schedule 1.01(a)(i) (containing each parcel of owned Real Property
to be made subject to a Mortgage) and Schedule 1.01(a)(ii) (containing each
parcel of leased Real Property to be made subject to a Mortgage), which shall be
subject to a Mortgage and each additional Real Property which shall be subject
to a Mortgage delivered pursuant to the provisions of Section 5.11.

     "Multiemployer Plan" shall mean a multiemployer plan as defined in Section
4001(a)(3) of ERISA.
<PAGE>

                                      -18-

     "Net Cash Proceeds" shall mean (a) with respect to any Asset Sale, the cash
proceeds (including cash proceeds subsequently received (as and when received)
in respect of noncash consideration initially received), net of (i) selling
expenses (including reasonable broker's fees or commissions, legal fees,
transfer and similar taxes and the Borrower's good faith estimate of income
taxes paid or payable in connection with such sale), (ii) amounts provided as a
reserve, in accordance with GAAP, against any liabilities under any
indemnification obligations associated with such Asset Sale (provided that, to
the extent and at the time any such amounts are released from such reserve, such
amounts shall constitute Net Cash Proceeds), (iii) the Borrower's good faith
estimate of payments required to be made with respect to unassumed liabilities
relating to the assets sold within 90 days of such Asset Sale (provided that, to
the extent such cash proceeds are not used to make payments in respect of such
unassumed liabilities within 90 days of such Asset Sale, such cash proceeds
shall constitute Net Cash Proceeds) and (iv) the principal amount, premium or
penalty, if any, interest and other amounts on any Indebtedness for borrowed
money which to the extent permitted hereunder and under the Security Documents
is secured by the asset sold in such Asset Sale and which is repaid with such
proceeds (other than any such Indebtedness assumed by the purchaser of such
asset), (b) with respect to any issuance or disposition of Indebtedness, the
cash proceeds thereof, net of all taxes and customary fees, commissions, costs
and other expenses incurred in connection therewith, (c) with respect to any
Equity Offering, the cash proceeds thereof, net of all customary fees,
commissions, costs and other expenses incurred in connection therewith and (d)
with respect to any Casualty Event, the cash Net Condemnation Award, Net
Insurance Proceeds or, in the case of any title loss, insurance proceeds,
relating to any title loss or other compensation received in respect thereof,
less the amount of all reasonable third-party expenses incurred in litigating,
arbitrating, compromising or settling any claim arising out of such title loss.

     "Net Condemnation Award" shall mean the proceeds of any award or payment on
account of a Taking, together with any interest earned thereon, less the amount
of any expenses incurred in litigating, arbitrating, compromising or settling
any claim arising out of such Taking.

     "Net Insurance Proceeds" shall mean the proceeds of any insurance payable
in respect of such Destruction together with any interest earned thereon, less
the amount of any expenses incurred in litigating, arbitrating, compromising or
settling any claim arising out of such Destruction.

     "New Senior Subordinated Note Documents" shall mean the New Senior
Subordinated Notes, the New Senior Subordinated Note Indenture and all other
documents executed and delivered with respect to the New Senior Subordinated
Notes, including any agreement with respect to the registration or exchange
thereof or the New Senior Subordinated Note Indenture.

     "New Senior Subordinated Note Indenture" shall mean the indenture or other
instrument pursuant to which the Senior Subordinated Notes may be issued subject
to such terms and conditions, including subordination provisions, as shall be
reasonably acceptable to the Lenders.

     "New Senior Subordinated Notes" shall mean the Borrower's Senior
Subordinated Notes Due 2009 to be issued pursuant to the New Senior Subordinated
Note Indenture and any notes issued by the Borrower in exchange for, and as
contemplated by, the New Senior Subordinated Notes with substantially identical
terms as the New Senior Subordinated Notes.

     "Obligations" shall mean all amounts, direct or indirect, contingent or
absolute, of every type or description, and at any time existing, owing to any
Lender or its respective successors, transferees or assignees by any Loan Party
pursuant to the terms of any Loan Document or secured by any of the Security
Documents, whether or not the right of such person to payment in respect of such
obligations and liabilities is reduced to
<PAGE>

                                      -19-

judgment, liquidated, unliquidated, fixed, contingent, matured, unmatured,
disputed, undisputed, legal, equitable, secured or unsecured and whether or not
such claim is discharged, stayed or otherwise affected by any bankruptcy case or
insolvency or liquidation proceeding.

     "Other Hedging Agreement" shall mean any foreign exchange contracts,
currency swap agreements, commodity agreements or other similar agreements or
arrangements designed to protect against the fluctuations in currency or
commodity values.

     "Other Taxes" shall mean any and all present or future stamp or documentary
taxes or any  other excise or property taxes, charges or similar levies arising
from any payment made under any Loan Document or from the execution, delivery or
enforcement of, or otherwise with respect to, any Loan Document.

     "PBGC" shall mean the Pension Benefit Guaranty Corporation referred to and
defined in ERISA.

     "Permitted Acquisition" shall have the meaning assigned to such term in
Section 6.04(j).

     "Permitted Liens" shall have the meaning assigned to such term in Section
6.02.

     "person" shall mean any natural person, corporation, business trust, joint
venture, association, company, limited liability company, partnership or
government, or any agency or political subdivision thereof.

     "Plan" shall mean any 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 307 of ERISA, and in respect of which the Borrower or
any ERISA Affiliate is (or, if such plan were terminated, would under Section
4069 of ERISA be deemed to be) an "employer" as defined in Section 3(5) of
ERISA.

     "Pledged Collateral" shall have the meaning assigned to such term in any
Security Agreement delivered on the Closing Date or thereafter pursuant to
Section 5.11.

     "Prior Liens" shall mean Liens which, pursuant to the provisions of the
applicable Security Document, are or may be superior to the Lien of such
Security Document.

     "pro forma basis" shall mean, in connection with any calculation of
compliance with any financial covenant or financial term, the calculation
thereof after giving effect on a pro forma basis to (w) if the relevant period
to be tested includes any period occurring prior to the Closing Date, the
consummation of the Divestitures or Spin-Off as if the same had occurred on the
first day of such period, (x) the assumption, incurrence or issuance of any
Indebtedness (other than revolving Indebtedness, except to the extent same is
incurred to finance the Divestitures or Spin-Off to refinance other outstanding
Indebtedness) after the first day of the relevant Interest Period as if such
Indebtedness had been incurred (and the proceeds thereof applied) on the first
day of the relevant Interest Period and (y) the permanent repayment of any
Indebtedness (other than revolving Indebtedness) after the first day of the
relevant Interest Period as if such Indebtedness had been retired, redeemed or
repurchased on the first day of the relevant Interest Period, with the following
rules to apply in connection therewith:

          (i)  all Indebtedness (x) (other than revolving Indebtedness, except
     to the extent same is incurred to finance the Divestiture or Asset Sale or
     to refinance other outstanding Indebtedness) assumed, incurred or issued
     after the first day of the relevant Interest Period (whether incurred to
     refinance Indebtedness or otherwise) shall be deemed to have been incurred
     or issued (and the proceeds thereof applied) on the first day of the
     respective Interest Period and remain outstanding through the
<PAGE>

                                      -20-

     date of determination and (y) (other than revolving Indebtedness)
     permanently retired or redeemed after the first day of the relevant
     Interest Period shall be deemed to have been retired or redeemed on the
     first day of the respective Interest Period and remain retired through the
     date of determination; and

          (ii) all Indebtedness assumed to be outstanding pursuant to preceding
     clause (i) shall be deemed to have borne interest at (x) the rate
     applicable thereto, in the case of fixed rate Indebtedness or (y) the rates
     which would have been applicable thereto during the respective period when
     same was deemed outstanding, in the case of floating rate Indebtedness
     (although interest expense with respect to any Indebtedness for period
     while same was actually outstanding during the respective period shall be
     calculated using the actual rates applicable thereto while same was
     actually outstanding).

     "Property" shall mean any right, title or interest in or to property or
assets of any kind whatsoever, whether real, personal or mixed and whether
tangible or intangible and including Equity Interests or other ownership
interests of any person.

     "Pro Rata Share" means (i) with respect to all payments, computations and
other matters relating to any Tranche A Term Loan Commitment or any Tranche A
Term Loan of any Lender, the percentage obtained by dividing (x) the Tranche A
Term Loan Exposure of that Lender by (y) the aggregate Tranche A Term Loan
Exposure of all Lenders, (ii) with respect to all payments, computations and
other matters relating to any Tranche B Term Loan Commitment or any Tranche B
Term Loan of any Lender, the percentage obtained by dividing (x) the Tranche B
Term Loan Exposure of that Lender by (y) the aggregate Tranche B Term Loan
Exposure of all Lenders, (iii) with respect to all payments, computations and
other matters relating to the Revolving Credit Commitment or the Revolving Loans
of any Lender or any Letters of Credit issued or participants therein purchased
by any Lender or in any Swing Line Loans, the percentage obtained by dividing
(x) the Revolving Credit Exposure of that Lender by (y) the aggregate Revolving
Credit Exposure of all Lenders and (iv) for all other purposes with respect to
each Lender, the percentage obtained by dividing (x) the sum of the Term Loan
Exposure of that Lender plus the Revolving Credit Exposure of that Lender by (y)
the sum of the aggregate Term Loan Exposure of all Lenders plus the aggregate
Revolving Credit Exposure of all Lenders, in any such case as the applicable
percentage may be adjusted by assignments permitted pursuant to Section 9.04.
The initial Pro Rate Share of each Lender for purposes of each of clauses (i),
(ii), (iii) and (iv) of the preceding sentence is set forth opposite the name of
that Lender in Schedule 2.01 annexed hereto.

     "Real Property" shall mean, collectively, all right, title and interest
(including, without limitation, any leasehold estate) in and to any and all
parcels of real property owned or operated by any person, whether by lease,
license or other use agreement, together with, in each case, all improvements
and appurtenant fixtures, equipment, personal property, easements and other
property and rights incidental to the ownership, lease or operation thereof.

     "Register" shall have the meaning given such term in Section 9.04(d).

     "Regulation T" shall mean Regulation T of the Board as from time to time in
effect and all official rulings and interpretations thereunder or thereof.

     "Regulation U" shall mean Regulation U of the Board as from time to time in
effect and all official rulings and interpretations thereunder or thereof.

     "Regulation X" shall mean Regulation X of the Board as from time to time in
effect and all official rulings and interpretations thereunder or thereof.
<PAGE>

                                      -21-

     "Related Fund" shall mean, with respect to any Lender that is a fund that
invests in bank loans, any other fund that invests in bank loans and is advised
or managed by the same investment advisor as such Lender or by an Affiliate of
such investment advisor.

     "Release" shall mean any spilling, leaking, pumping, pouring, emitting,
emptying, discharging, injecting, escaping, leaching, dumping, disposing,
depositing, dispersing, emanating or migrating of any Hazardous Material in,
into, onto or through the environment.

     "Remedial Action" shall mean (a) a "remedial action" as such term is
defined in CERCLA, 42 U.S.C. Section 9601(24), and (b) all other actions
required by any Governmental Authority  to: (i) clean up, remove, treat, abate
or in any other way address any Hazardous Material in the environment; (ii)
prevent the Release or threat of Release, or minimize the further Release of any
Hazardous Material so it does not migrate or endanger or threaten to endanger
public health, welfare or the environment; or (iii) perform studies and
investigations in connection with, or as a precondition to, (i) or (ii) above.

     "Required Lenders" shall mean, at any time, Lenders having Loans (excluding
Swingline Loans), L/C Exposure, Swingline Exposure and unused Revolving Credit
and Term Loan Commitments representing at least a majority of the sum of all
Loans (excluding Swingline Loans) outstanding, L/C Exposure, Swingline Exposure
and unused Revolving Credit and Term Loan Commitments at such time.

     "Requirements of Law" shall mean, collectively, any and all requirements of
any Governmental Authority including, without limitation, any and all laws,
ordinances, rules, regulations or similar statutes or case law.

     "Responsible Officer" of any corporation shall mean any executive officer
or Financial Officer of such corporation and any other officer or similar
official thereof responsible for the administration of the obligations of such
corporation in respect of this Agreement.

     "Revolving Credit Borrowing" shall mean a Borrowing comprised of Revolving
Loans.

     "Revolving Credit Commitment" shall mean, with respect to each Lender, the
commitment of such Lender to make Revolving Loans hereunder as set forth on
Schedule 2.01, or in the Assignment and Acceptance pursuant to which such Lender
assumed its Revolving Credit Commitment, as applicable, as the same may be (a)
reduced from time to time pursuant to Section 2.09 and (b) reduced or increased
from time to time pursuant to assignments by or to such Lender pursuant to
Section 9.04.

     "Revolving Credit Exposure" shall mean, with respect to any Lender at any
time, the aggregate principal amount at such time of all outstanding Revolving
Loans of such Lender, plus the aggregate amount at such time of such Lender's
L/C Exposure, plus the aggregate amount at such time of such Lender's Swingline
Exposure.

     "Revolving Credit Lender" shall mean a Lender with a Revolving Credit
Commitment.

     "Revolving Credit Maturity Date" shall mean July 30, 2006.

     "Revolving Loans" shall mean the revolving loans made in Dollars by the
Lenders to the Borrower pursuant to clause (c) of Section 2.01.  Each Revolving
Loan shall be a LIBOR Revolving Loan or an ABR Revolving Loan.
<PAGE>

                                      -22-

     "Secured Parties" shall have the meaning assigned to such term in the
Security Documents.

     "Securities Act" shall mean the Securities Act of 1933, as amended.

     "Security Agreement" shall mean the Security Agreement, substantially in
the form of Exhibit F, among the Borrower, the Subsidiary Guarantors, certain
other Subsidiaries and the Collateral Agent for the benefit of the Secured
Parties, as the same may be amended in accordance with the terms thereof and
hereof or such other agreements acceptable to the Collateral Agent as shall be
necessary to comply with applicable Requirements of Law and effective to grant
to the Collateral Agent a perfected first priority Lien on and security interest
in the Pledged Collateral.

     "Security Documents" shall mean the Mortgages, the Security Agreement and
each other security document or pledge agreement required by applicable
Requirements of Law to grant a valid, perfected Lien on and security interest in
any Property hereafter acquired or developed or any other Additional Collateral,
and all UCC or other financing statements or instruments of perfection required
by this Agreement, the Security Agreement or any Mortgage to be filed with
respect to the security interests in Property created pursuant to any Security
Agreement or any Mortgage and any other document or instrument utilized to
pledge or grant a security interest in any Property of whatever kind or nature
as collateral for the Obligations including, without limitation, any and all
documents or instruments delivered pursuant to Section 5.11.

     "Senior Debt" shall mean, at any date, the Consolidated Indebtedness of the
Borrower other than Subordinated Debt.

     "Senior Leverage Ratio" shall mean, at any date, the ratio of (x) Senior
Debt to (y) Consolidated EBITDA for the four fiscal quarters preceding such
date.

     "SPC" has the meaning specified in Section 9.04(i).

     "Spin-Off" shall mean the spin-off by the Borrower of APW, Ltd.

     "Statutory Reserves" shall mean a fraction (expressed as a decimal), the
numerator of which is the number one and the denominator of which is the number
one minus the aggregate of the maximum reserve percentages (including any
marginal, special, emergency or supplemental reserves) expressed as a decimal
established by the Board and any other banking authority, domestic or foreign,
to which the Administrative Agent or any Lender (including any branch,
Affiliate, or other fronting office making or holding a Loan) is subject for
Eurocurrency Liabilities (as defined in Regulation D of the Board).  Such
reserve percentages shall include those imposed pursuant to such Regulation D.
LIBOR and EURIBOR Loans shall be deemed to constitute Eurocurrency Liabilities
and to be subject to such reserve requirements without benefit of or credit for
proration, exemptions or offsets that may be available from time to time to any
Lender under such Regulation D.  Statutory Reserves shall be adjusted
automatically on and as of the effective date of any change in any reserve
percentage.

     "Subordinated Debt" shall mean Indebtedness of the Borrower or any
Subsidiary that is contractually subordinated to any other Indebtedness of the
Borrower or such Subsidiary, as the case may be, on terms satisfactory to the
Required Lenders.  No Indebtedness shall be subordinate to any other
Indebtedness solely by virtue of such other Indebtedness being secured and such
Indebtedness not being secured or not being secured by the same collateral.
<PAGE>

                                      -23-

     "subsidiary" shall mean, with respect to any person (herein referred to as
the "parent"), any corporation, partnership, association or other business
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 more
than 50% of the general partnership interests are, at the time any determination
is being made, owned, controlled or held, or (b) that is, at the time any
determination is made, 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.

     "Subsidiary" shall mean any subsidiary of the Borrower.

     "Subsidiary Borrower" shall mean any Subsidiary that borrows funds
hereunder upon execution of the Assumption Agreement pursuant to Section 2.24.

     "Subsidiary Guarantee Agreement" shall mean the Subsidiary Guarantee
Agreement, substantially in the form of Exhibit G, made by the Subsidiary
Guarantors in favor of the Collateral Agent for the benefit of the Secured
Parties.

     "Subsidiary Guarantor" shall mean each Subsidiary listed on Schedule
1.01(b), and each other Subsidiary that is or becomes a party to a Subsidiary
Guarantee Agreement.

     "Survey" shall mean a survey of any Real Property (and all improvements
thereon):  (i) prepared by a surveyor or engineer licensed to perform surveys in
the state, province or country where such Real Property is located, (ii) dated
(or redated) not earlier than 6 months prior to the date of delivery thereof
unless there shall have occurred after the date of such survey any exterior
construction on the site of such Real Property, in which event such survey shall
be dated (or redated) after the completion of such construction or, if such
construction shall not have been completed as of such date of delivery, not
earlier than 20 days prior to such date of delivery, (iii) certified by the
surveyor (in a manner acceptable to the Collateral Agent) to the Collateral
Agent and (iv) sufficiently detailed for the Title Company to delete the survey
exceptions or issue a comprehensive endorsement in the applicable title
insurance policy, and if necessary to do so, complying in all respects with the
minimum detail requirements of the American Land Title Association as such
requirements are in effect on the date of preparation of such Survey.

     "Swingline Commitment" shall mean the commitment of the Swingline Lender to
make loans pursuant to Section 2.22, as the same may be reduced from time to
time pursuant to Section 2.09 or Section 2.22.

     "Swingline Exposure" shall mean at any time the aggregate principal amount
at such time of all outstanding Swingline Loans.  The Swingline Exposure of any
Revolving Credit Lender at any time shall equal its Pro Rata Share of the
aggregate Swingline Exposure at such time.

     "Swingline Loan" shall mean any loan made by the Swingline Lender pursuant
to Section 2.22.

     "Taking" shall mean any taking of any Property of the Borrower or any of
the Subsidiaries or any part thereof, in or by condemnation or other eminent
domain proceedings pursuant to any law, general or special, or by reason of the
temporary requisition of the use or occupancy of any Property of the Borrower or
any of the Subsidiaries or any part thereof, by any Governmental Authority,
civil or military.

     "TARGET Settlement Day" means any day on which the Trans-European Automated
Real-Time Gross Settlement Express Transfer (TARGET) System is open.
<PAGE>

                                      -24-

     "Taxes" shall mean any and all present or future taxes, levies, imposts,
duties, deductions, charges or withholdings imposed by any Governmental
Authority.

     "Tender Offer" shall mean the offer to purchase all of the Existing Senior
Subordinated Notes on or before the consummation of the Spin-Off.

     "Term Borrowing" shall mean a Borrowing comprised of Tranche A Term Loans
or Tranche B Term Loans.

     "Term Loan Commitments" shall mean the Tranche A Commitments and the
Tranche B Commitments.

     "Term Loan Repayment Dates" shall mean the Tranche A Term Loan Repayment
Dates and the Tranche B Term Loan Repayment Dates.

     "Term Loans" shall mean the Tranche A Term Loans, the Tranche B Term Loans
and the Tranche C Term Loans.

     "Title Company" shall mean First American Title Insurance Company or such
other title insurance company acceptable to the Collateral Agent.

     "Total Revolving Credit Commitment" shall mean, at any time, the aggregate
amount of the Revolving Credit Commitments, as in effect at such time.

     "Tranche A Commitment" shall mean, with respect to each Lender, the
commitment of such Lender to make Tranche A Term Loans hereunder as set forth on
Schedule 2.01, or in the Assignment and Acceptance pursuant to which such Lender
assumed its Term Loan Commitment, as applicable, as the same may be (a) reduced
from time to time pursuant to Section 2.09 and (b) reduced or increased from
time to time pursuant to assignments by or to such Lender pursuant to Section
9.04.

     "Tranche A Maturity Date" shall mean July 30, 2006.

     "Tranche A Term Borrowing" shall mean a Borrowing comprised of Tranche A
Term Loans.

     "Tranche A Term Loan Exposure" means, with respect to any Lender as of any
date of determination (i) prior to the funding of all of the Tranche A Term
Loans, that Lender's Tranche A Term Loan Commitment and (ii) after all of the
funding of the Tranche A Term Loans, the Dollar Equivalent of the outstanding
principal amount of the Tranche A Term Loan of that Lender.

     "Tranche A Term Loan Repayment Date" shall have the meaning assigned to
such term in Section 2.11(a)(i).

     "Tranche A Term Loans" shall mean the term loans made in Dollars or the
Alternative Currency, as specified by the Borrower in accordance with Section
2.03 by the Lenders to the Borrower pursuant to clause (a) of Section 2.01.
Each Tranche A Term Loan shall be an EURIBOR Term Loan if it is an Alternative
Currency Loan or either a LIBOR Term Loan or an ABR Term Loan if it is a Dollar
Loan.

     "Tranche B Commitment" shall mean, with respect to each Lender, the
commitment of such Lender to make Tranche B Term Loans hereunder as set forth on
Schedule 2.01, or in the Assignment and Acceptance
<PAGE>

                                      -25-

pursuant to which such Lender assumed its Term Loan Commitment, as applicable,
as the same may be (a) reduced from time to time pursuant to Section 2.09 and
(b) reduced or increased from time to time pursuant to assignments by or to such
Lender pursuant to Section 9.04

     "Tranche B Maturity Date" shall mean July 30, 2008.

     "Tranche B Term Borrowing" shall mean a Borrowing comprised of Tranche B
Term Loans.

     "Tranche B Term Loan Exposure" means, with respect to any Lender as of any
date of determination (i) prior to the funding of the Tranche B Term Loans, that
Lender's Tranche B Term Loan Commitment and (ii) after the funding of the
Tranche B Term Loans, the outstanding principal amount of the Tranche B Term
Loan of that Lender.

     "Tranche B Term Loan Repayment Date" shall have the meaning assigned to
such term in Section 2.11(a)(ii).

     "Tranche B Term Loans" shall mean the term loans made in Dollars by the
Lenders to the Borrower pursuant to clause (b) of Section 2.01.  Each Tranche B
Term Loan shall be either a LIBOR Term Loan or an ABR Term Loan.

     "Tranche C Maturity Date" shall have the meaning assigned to such term in
Section 2.25 hereof.

     "Tranche C Term Loan" shall have the meaning assigned to such term in
Section 2.25 hereof.

     "Tranche C Term Loan Lenders" shall have the meaning assigned to such term
in Section 2.25 hereof.

     "Tranche C Term Loan Draw Date" means the date on which the Tranche C Term
Loans are drawn by the Borrower.

     "Transaction Documents" shall mean the documents entered into or delivered
in connection with the Transactions.

     "Transactions" shall mean, collectively, the transactions to occur on or
prior to the Closing Date pursuant to the Transaction Documents, including (a)
the consummation of the Spin-Off, (b) the consummation of the Divestitures, (c)
the execution and delivery of the Loan Documents and the initial borrowings
hereunder, (d) the execution and delivery of the New Senior Subordinated Note
Documents and the issuance of the New Senior Subordinated Notes and (e) the
redemption of all of the Existing Senior Subordinated Notes and the payment of
any accrued interest thereon or premium with respect thereto pursuant to the
Tender Offer.

     "Type", when used in respect of any Loan or Borrowing, shall refer to the
Rate by reference to which interest on such Loan or on the Loans comprising such
Borrowing is determined.  For purposes hereof, the term "Rate" shall include the
Adjusted EURIBOR, Adjusted LIBOR and the Alternate Base Rate.

     "UCC" shall mean the Uniform Commercial Code as in effect in the applicable
state or jurisdiction.

     "Voting Stock" shall mean any class or classes of capital stock of the
Borrower pursuant to which the holders thereof have the general voting power
under ordinary circumstances to elect at least a majority of the Board of
Directors of the Borrower.
<PAGE>

                                      -26-

     "Wholly Owned Subsidiary" shall mean, as to any person, (a) any corporation
100% of whose capital stock (other than directors' qualifying shares) is at the
time owned by such person and/or one or more Wholly Owned Subsidiaries of such
person and (b) any partnership, association, joint venture, limited liability
company or other entity in which such person and/or one or more Wholly Owned
Subsidiaries of such person has a 100% equity interest at such time (other than
directors', managing partners' or managing members' qualifying equity
interests).

     "Withdrawal Liability" shall mean liability to a Multiemployer Plan as a
result of a complete or partial withdrawal from such Multiemployer Plan, as such
terms are defined in Part I of Subtitle E of Title IV of ERISA.

     SECTION 1.02.  Terms Generally.  The definitions in Section 1.01 shall
apply equally to both the singular and plural forms of the terms defined.
Whenever the context may require, any pronoun shall include the corresponding
masculine, feminine and neuter forms.  The words "include", "includes" and
"including" shall be deemed to be followed by the phrase "without limitation".
All references herein to Articles, Sections, Exhibits and Schedules shall be
deemed references to Articles and Sections of, and Exhibits and Schedules to,
this Agreement unless the context shall otherwise require.  Except as otherwise
expressly provided herein, any reference in this Agreement to any Loan Document
shall mean such document as amended, restated, supplemented or otherwise
modified from time to time.  Notwithstanding that one or more Subsidiaries shall
at any time become Subsidiary Borrowers pursuant to Section 2.24, for purposes
of determining compliance with the provisions of Article VI the term "Borrower"
shall in all cases mean the Company.

     SECTION 1.03.  Accounting Terms.  All terms of an accounting or financial
nature shall be construed in accordance with GAAP, as in effect from time to
time; provided, however, that if the Borrower notifies the Administrative Agent
that the Borrower wishes to amend any covenant in Article VI or any related
definition to eliminate the effect of any change in GAAP occurring after the
date of this Agreement on the operation of such covenant (or if the
Administrative Agent notifies the Borrower that the Required Lenders wish to
amend Article VI or any related definition for such purpose), then the
Borrower's compliance with such covenant shall be determined on the basis of
GAAP in effect immediately before the relevant change in GAAP became effective,
until either such notice is withdrawn or such covenant is amended in a manner
satisfactory to the Borrower and the Required Lenders.

     SECTION 1.04.  Exchange Rates.  The Administrative Agent shall determine
the Exchange Rate or any specified date to be used for calculating relevant
Dollar Equivalent and Alternative Currency Equivalent amounts.  The Exchange
Rates so determined shall become effective on the specified date shall remain
effective for all purposes of this Agreement (other than any provision expressly
requiring the use of a current Exchange Rate) and shall be the Exchange Rates
employed in converting any amounts between the applicable currencies.

                                   ARTICLE II

                                  The Credits

     SECTION 2.01.  Commitments.  Subject to the terms and conditions and
relying upon the representations and warranties herein set forth, each Lender
agrees, severally and not jointly, (a) to make a Tranche A Term Loan in Dollars
or an Alternative Currency to the Borrower on the Closing Date in a principal
amount not to exceed its Pro Rata Share of its Tranche A Commitment; provided,
however, that the Dollar Equivalent of the
<PAGE>

                                      -27-

Alternative Currency Tranche A Term Loans in any Alternative Currency made by
all Tranche A Term Lenders shall not exceed the Dollar Equivalent of
$30,000,000, (b) to make a Tranche B Term Loan in Dollars to the Borrower on the
Closing Date in a principal amount not to exceed its Pro Rata Share of the
Tranche B Commitment, and (c) to make Revolving Loans in Dollars to the
Borrower, at any time and from time to time on or after the Closing Date, and
until the earlier of the Revolving Credit Maturity Date and the termination of
the Revolving Credit Commitment of such Lender in accordance with the terms
hereof, in an aggregate principal amount at any time outstanding that will not
result in such Lender's Pro Rata Share of the Revolving Credit Exposure
exceeding such Lender's Pro Rata Share of the Revolving Credit Commitment;
provided, a maximum of $15,000,000 in Revolving Loans shall be available on the
Closing Date. Within the limits set forth in clause (c) of the preceding
sentence and subject to the terms, conditions and limitations set forth herein,
the Borrower may borrow, pay or prepay and reborrow Revolving Loans. Amounts
paid or prepaid in respect of Term Loans may not be reborrowed. The amount of
each Tranche A Commitment (including the sublimit for any Alternative Currency
Loans), Tranche B Commitment and Revolving Credit Commitment with respect to
each Lender is set forth opposite such Lender's name on Schedule 2.01 hereto.

     SECTION 2.02.  Loans.  (a)  Each Loan (other than Swingline Loans) shall
be made as part of a Borrowing consisting of Loans made by the Lenders ratably
in accordance with their applicable Commitments; provided, however, that the
failure of any Lender to make any Loan shall not in itself relieve any other
Lender of its obligation to lend hereunder (it being understood, however, that
no Lender shall be responsible for the failure of any other Lender to make any
Loan required to be made by such other Lender).  Except for Loans deemed made
pursuant to Section 2.02(e), the Loans comprising any Borrowing shall be in an
aggregate principal amount that is (i) an integral multiple of $1,000,000 (or
the Alternative Currency Equivalent thereof) and not less than $5,000,000 (or
the Alternative Currency Equivalent thereof) or (ii) equal to the remaining
available balance of the applicable Commitments.

     (b) Subject to Sections 2.08 and 2.15, each Borrowing shall be comprised
entirely of ABR Loans or Eurocurrency Rate Loans as the Borrower may request
pursuant to Section 2.03.  Each Lender may at its option make any Eurocurrency
Rate Loan by causing any domestic or foreign branch or Affiliate of such Lender
to make such Loan; provided that any exercise of such option shall not affect
the obligation of the Borrower to repay such Loan in accordance with the terms
of this Agreement.  Borrowings of more than one Type may be outstanding at the
same time; provided, however, that the Borrower shall not be entitled to request
any Borrowing that, if made, would result in more than 12 Eurocurrency Rate
Borrowings outstanding hereunder at any time.  For purposes of the foregoing,
Borrowings having different Interest Periods, regardless of whether they
commence on the same date, shall be considered separate Borrowings.

     (c) Except with respect to Loans made pursuant to Section 2.02(e), each
Lender shall make each Loan to be made by it hereunder on the proposed date
thereof by wire transfer of immediately available funds to such account in New
York City as the Administrative Agent may designate not later than 1:00 p.m.,
New York City time, in each case in same day funds, in Dollars and the
Administrative Agent shall promptly credit the amounts so received to an account
as directed by the Borrower in the applicable Borrowing Request or, if a
Borrowing shall not occur on such date because any condition precedent herein
specified shall not have been met, return the amounts so received to the
respective Lenders.

     (d) Unless the Administrative Agent shall have received notice from a
Lender prior to the date of any Borrowing that such Lender will not make
available to the Administrative Agent such Lender's portion of such Borrowing,
the Administrative Agent may assume that such Lender has made such portion
available to the Administrative Agent on the date of such Borrowing in
accordance with paragraph (c) above and the Administrative Agent may, in
reliance upon such assumption, make available to the Borrower on such date a
corre-
<PAGE>

                                      -28-

sponding amount. If the Administrative Agent shall have so made funds available
then, to the extent that such Lender shall not have made such portion available
to the Administrative Agent, such Lender and the Borrower severally agree to
repay to the Administrative Agent forthwith on demand such corresponding amount
together with interest thereon, for each day from the date such amount is made
available to the Borrower until the date such amount is repaid to the
Administrative Agent at (i) in the case of the Borrower, the interest rate
applicable at the time to the Loans comprising such Borrowing and (ii) in the
case of such Lender, a rate determined by the Administrative Agent to represent
its cost of overnight or short-term funds (which determination shall be
conclusive absent manifest error). If such Lender shall repay to the
Administrative Agent such corresponding amount, such amount shall constitute
such Lender's Loan as part of such Borrowing for purposes of this Agreement.

     (e) If the Issuing Bank shall not have received from the Borrower the
payment required to be made by Section 2.23(e) within the time specified in such
Section, the Issuing Bank will promptly notify the Administrative Agent of the
L/C Disbursement and the Administrative Agent will promptly notify each
Revolving Credit Lender of such L/C Disbursement and its Pro Rata Share thereof.
Each Revolving Credit Lender shall pay by wire transfer of immediately available
funds to the Administrative Agent on such date (or, if such Revolving Credit
Lender shall have received such notice later than 12:00 (noon), New York City
time, on any day, not later than 10:00 a.m., New York City time, on the
immediately following Business Day), an amount equal to such Lender's Pro Rata
Share of such L/C Disbursement (it being understood that such amount shall be
deemed to constitute an ABR Revolving Loan of such Lender and such payment shall
be deemed to have reduced the L/C Exposure), and the Administrative Agent will
promptly pay to the Issuing Bank amounts so received by it from the Revolving
Credit Lenders.  The Administrative Agent will promptly pay to the Issuing Bank
any amounts received by it from the Borrower pursuant to Section 2.23(e) prior
to the time that any Revolving Credit Lender makes any payment pursuant to this
paragraph (f); any such amounts received by the Administrative Agent thereafter
will be promptly remitted by the Administrative Agent to the Revolving Credit
Lenders that shall have made such payments and to the Issuing Bank, as their
interests may appear.  If any Revolving Credit Lender shall not have made its
Pro Rata Share of such L/C Disbursement available to the Administrative Agent as
provided above, such Lender and the Borrower severally agree to pay interest on
such amount, for each day from and including the date such amount is required to
be paid in accordance with this paragraph to but excluding the date such amount
is paid, to the Administrative Agent for the account of the  Issuing Bank at (i)
in the case of the Borrower, a rate per annum equal to the interest rate
applicable to Revolving Loans pursuant to Section 2.06(a), and (ii) in the case
of such Lender, for the first such day, the Federal Funds Effective Rate, and
for each day thereafter, the Alternate Base Rate.

     SECTION 2.03.  Borrowing Procedure.  In order to request a Borrowing
(other than a Swingline Loan or deemed Borrowing pursuant to Section 2.02(e), as
to which this Section 2.03 shall not apply), the Borrower shall hand deliver or
telecopy to the Administrative Agent a duly completed Borrowing Request (a) in
the case of a Eurocurrency Rate Borrowing denominated in Dollars, not later than
11:00 a.m., New York City time, three Business Days before a proposed Borrowing,
(b) in the case of an ABR Borrowing, not later than 11:00 a.m., New York City
time, on the day of a proposed Borrowing and (c) in the case of an Alternative
Currency Borrowing, not later than 12:00 noon, local time of the jurisdiction of
such Alternative Currency, at least four Business Days before a proposed
Borrowing.  Each Borrowing Request shall be irrevocable, shall be signed by or
on behalf of the Borrower and shall specify the following information:  (i)
whether the Borrowing then being requested is to be a Tranche A Term Borrowing,
a Tranche B Term Borrowing or a Revolving Credit Borrowing, and whether such
Borrowing is to be a Eurocurrency Rate Borrowing (and in the case of the Tranche
A Term Borrowing, whether the applicable rate shall be a EURIBOR Borrowing or
LIBOR Borrowing) or an ABR Borrowing (provided that until the Administrative
Agent shall have notified the Borrower that the primary syndication of the
Commitments has been completed (which notice shall be given as promptly as
practicable and, in any
<PAGE>

                                      -29-

event, within 14 days after the Closing Date), the Borrower shall not be
permitted to request a Eurocurrency Borrowing); (ii) in the case of a Tranche A
Term Borrowing on the Closing Date, the currency applicable to such Borrowing;
(iii) the date of such Borrowing (which shall be a Business Day), (iv) the
number and location of the account to which funds are to be disbursed (which
shall be an account that complies with the requirements of Section 2.02(c)); (v)
the amount (in Dollars or the Alternative Currency, as the case may be) of such
Borrowing; (vi) if such Borrowing is to be a Eurocurrency Rate Borrowing, the
Interest Period with respect thereto and (vii) the entity which will be the
Borrower for such Loan; provided, however, that, notwithstanding any contrary
specification in any Borrowing Request, each requested Borrowing shall comply
with the requirements set forth in Section 2.02. If no election as to the Type
of Borrowing is specified in any such notice, then the requested Borrowing shall
be an ABR Borrowing. If no election as to the currency of Borrowing is specified
in any such notice, then the requested Borrowing shall be denominated in
Dollars. The Administrative Agent shall promptly advise the applicable Lenders
of any notice given pursuant to this Section 2.03 (and the contents thereof),
and of each Lender's portion of the requested Borrowing.

     SECTION 2.04.  Evidence of Debt; Repayment of Loans.  (a)  The Borrower
hereby unconditionally promises to pay to the Administrative Agent (i) for the
account of the Swingline Lender, the then unpaid principal amount of each
Swingline Loan, upon the request of the Swingline Lender, on the last day of the
Interest Period applicable to such Loan or, if earlier, on the Revolving Credit
Maturity Date,  (ii) for the account of each Lender holding Term Loans, the
principal amount of each Term Loan of such Lender as provided in Section 2.11
and (iii) for the account of each Revolving Credit Lender, the then unpaid
principal amount of each Revolving Loan of such Lender on the Revolving Credit
Maturity Date.

     (b) Each Lender shall maintain in accordance with its usual practice an
account or accounts evidencing the indebtedness of the Borrower to such Lender
resulting from each Loan made by such Lender from time to time, including the
amounts of principal and interest payable and paid such Lender from time to time
under this Agreement.

     (c) The Administrative Agent shall maintain accounts in which it will
record (i) the amount of each Loan made hereunder (including, in the case of an
Alternative Currency Loan, the Dollar Equivalent, thereof), the Type thereof and
the Interest Period applicable thereto, (ii) the amount of any principal or
interest due and payable or to become due and payable from the Borrower to each
Lender hereunder and (iii) the amount of any sum received by the Administrative
Agent hereunder from the Borrower or any Subsidiary Guarantor and each Lender's
share thereof.

     (d) The entries made in the accounts maintained pursuant to paragraphs (b)
and (c) above shall be prima facie evidence of the existence and amounts of the
obligations therein recorded; provided, however, that the failure of any Lender
or the Administrative Agent to maintain such accounts or any error therein shall
not in any manner affect the obligations of the Borrower to repay the Loans in
accordance with their terms.

     (e) Any Lender may request that the Loans made by it hereunder be evidenced
by a promissory note.  In such event, the Borrower shall execute and deliver to
such Lender a promissory note payable to such Lender and its registered assigns
and in a form and substance reasonably acceptable to the Administrative Agent
and the Borrower.  Notwithstanding any other provision of this Agreement, in the
event any Lender shall request and receive such a promissory note, the interests
represented by such note shall at all times (including after any assignment of
all or part of such interests pursuant to Section 9.04) be represented by one or
more promissory notes payable to the payee named therein or its registered
assigns.
<PAGE>

                                      -30-

     SECTION 2.05.  Fees. (a) The Borrower agrees to pay to each Lender, through
the Administrative Agent, on the last Business Day of March, June, September and
December in each year and on the Revolving Credit Maturity Date, a commitment
fee (a "Commitment Fee") equal to the Applicable Percentage for unused Revolving
Credit Commitments on the average daily unused amount of the Commitments of such
Lender (other than the Swingline Commitment) during the preceding quarter (or
other period commencing with the date hereof and ending with the Revolving
Credit Maturity Date or the date on which the Revolving Credit Commitments of
all Lenders shall expire or be terminated). All Commitment Fees shall be
computed on the basis of the actual number of days elapsed in a year of 360
days. The Commitment Fee due to each Lender shall commence to accrue on the date
hereof and shall cease to accrue on the date on which the Commitment of such
Lender shall expire or be terminated as provided herein. For purposes of
calculating Commitment Fees only, no portion of the Revolving Credit Commitments
shall be deemed utilized under Section 2.17 as a result of outstanding Swingline
Loans.

     (b) The Borrower agrees to pay to the Administrative Agent, for its own
account, the administrative fees separately agreed to by the Borrower and the
Administrative Agent (the "Administrative Agent Fees").

     (c) The Borrower agrees to pay (i) to each Revolving Credit Lender, through
the Administrative Agent, on the last Business Day of March, June, September and
December of each year and on the Revolving Credit Maturity Date, a fee (an "L/C
Participation Fee") calculated on such Lender's Pro Rata Share of the average
daily aggregate L/C Exposure (excluding the portion thereof attributable to
unreimbursed L/C Disbursements) during the preceding quarter (or shorter period
commencing with the date hereof or ending with the Revolving Credit Maturity
Date or the date on which all Letters of Credit have been canceled or have
expired and the Revolving Credit Commitments of all Lenders shall have been
terminated) at a rate equal to the Applicable Percentage from time to time used
to determine the interest rate on Revolving Credit Borrowings comprised of
Eurocurrency Rate Loans pursuant to Section 2.06, and (ii) the fees payable
pursuant to the Letter of Credit Fee Letter dated the date hereof between the
Borrower and the Administrative Agent (the "Issuing Bank Fees").  All L/C
Participation Fees and Issuing Bank Fees shall be computed on the basis of the
actual number of days elapsed in a year of 360 days.

     (d) All Fees shall be paid on the dates due, in immediately available funds
in Dollars, to the Administrative Agent for distribution, if and as appropriate,
among the Lenders, except that the Issuing Bank Fees shall be paid directly to
the Issuing Bank.  Once paid, none of the Fees shall be refundable under any
circumstances.

     SECTION 2.06.  Interest on Loans. (a) Subject to the provisions of Section
2.07, the Loans comprising each ABR Borrowing, including each Swingline Loan,
shall bear interest (computed on the basis of the actual number of days elapsed
over a year of 365 or 366 days, as the case may be, when the Alternate Base Rate
is determined by reference to the Prime Rate and over a year of 360 days at all
other times) at a rate per annum equal to the Alternate Base Rate plus the
Applicable Percentage in effect from time to time.

     (b) Subject to the provisions of Section 2.07, the Loans comprising each
LIBOR Borrowing shall bear interest (computed on the basis of the actual number
of days elapsed over a year of 360 days) at a rate per annum equal to the
Adjusted LIBOR for the Interest Period in effect for such Borrowing plus the
Applicable Percentage in effect from time to time.

     (c) Subject to the provisions of Section 2.07, the Loans comprising each
Alternative Currency Borrowing shall bear interest (computed on the basis of the
actual number of days elapsed over a year of 360
<PAGE>

                                      -31-

days) at a rate equal to the Adjusted EURIBOR for the Interest Period in effect
for such Borrowing plus the Applicable Percentage in effect from time to time.

     (d) Interest on each Loan shall be payable on the Interest Payment Dates
applicable to such Loan except as otherwise provided in this Agreement.  The
applicable Alternate Base Rate, Adjusted LIBOR or EURIBOR Rate for each Interest
Period or day within an Interest Period, as the case may be, shall be determined
by the Administrative Agent, and such determination shall be conclusive absent
manifest error.

     (e) The Tranche C Term Loans shall bear interest at a rate determined by
the Administrative Agent on the Tranche C Term Loan Draw Date.  On the Tranche C
Term Loan Draw Date, the interest rate (and Applicable Percentage) applicable to
the Tranche B Term Loans shall be reset to the greater of (i) the interest rate
(and Applicable Percentage) applicable to the Tranche Term B Loans on the
Tranche C Term Loan Draw Date and (ii) the interest rate (and Applicable
Percentage) applicable to the Tranche C Term Loans, and all other Applicable
Percentages for Tranche B Term Loans of any type shall be automatically deemed
to be adjusted by a like percentage.

     SECTION 2.07.  Default Interest.  If the Borrower shall default in the
payment of the principal of or interest on any Loan or any other amount becoming
due hereunder, by acceleration or otherwise, or under any other Loan Document,
the Borrower shall on demand from time to time pay interest, to the extent
permitted by law, on such defaulted amount to but excluding the date of actual
payment (after as well as before judgment) (a) in the case of overdue principal,
at the rate otherwise applicable to such Loan pursuant to Section 2.06 plus
2.00% per annum and (b) in all other cases, at a rate per annum (computed on the
basis of the actual number of days elapsed over a year of 365 or 366 days, as
the case may be, when determined by reference to the Prime Rate and over a year
of 360 days at all other times) equal to the rate that would be applicable to an
ABR Revolving Loan plus 2.00%; provided that in the case of Eurocurrency Rate
Loans which are Dollar Loans, upon the expiration of the Interest Period in
effect at the time any such increase in interest rate is effective such
Eurocurrency Rate Loans shall thereupon become Alternate Base Rate Loans and
shall thereafter bear interest payable upon demand at a rate which is 2% per
annum in excess of the interest rate otherwise payable under this Agreement for
Alternate Base Rate Loans; provided, further, that in the case of Eurocurrency
Rate Loans which are Alternative Currency Loans, upon the expiration of the
Interest Period in effect at the time any such increase in interest rate is
effective such Eurocurrency Rate Loans shall continue as Eurocurrency Rate Loans
with one month Interest Periods and shall thereafter bear interest payable upon
demand at a rate which is 2% per annum in excess of the interest rate otherwise
payable under this Agreement for such Loans, and all other Applicable
Percentages on Tranche B Term Loans shall be automatically deemed to be adjusted
by a like percentage.

     SECTION 2.08.  Special Provisions Governing Eurocurrency Rate Loans  .
Notwithstanding any other provision of this Agreement to the contrary, the
following provisions shall govern with respect to Eurocurrency Rate Loans as to
the matters covered:

          (a) Determination of Applicable Interest Rate.  As soon as practicable
              -----------------------------------------
     after 10:00 A.M. (New York City time) on each Interest Rate Determination
     Date, Administrative Agent shall determine (which determination shall,
     absent manifest error, be final, conclusive and binding upon all parties)
     the interest rate that shall apply to the Eurocurrency Rate Loans for which
     an interest rate is then being determined for the applicable Interest
     Period and shall promptly give notice thereof (in writing or by telephone
     confirmed in writing) to the Borrowers and each Lender.

          (b) Inability to Determine Applicable Interest Rate.  In the event
              -----------------------------------------------
     that Administrative Agent shall have determined (which determination shall
     be final and conclusive and binding upon all
<PAGE>

                                      -32-

     parties hereto absent manifest error), on any Interest Rate Determination
     Date with respect to any Eurocurrency Rate Loans, that by reason of
     circumstances affecting the relevant Eurocurrency interbank market adequate
     and fair means do not exist for ascertaining the interest rate applicable
     to such Loans on the basis provided for in the definition of any rate that
     is an Adjusted Eurocurrency Rate, Administrative Agent shall on such date
     give notice (by telefacsimile or by telephone confirmed in writing) to the
     Borrower and each Lender of such determination, whereupon (i) no Loans may
     be made as, or converted to, EURIBOR Term Loans or LIBOR Loans, as the case
     may be, until such time as Administrative Agent notifies the Borrower and
     Lenders that the circumstances giving rise to such notice no longer exist
     and (ii) any Notice of Borrowing or Notice of Conversion/Continuation given
     by the Borrowers with respect to the Loans in respect of which such
     determination was made shall be deemed to be rescinded by the Borrowers.

          (c) Indemnification for Breakage or Non-Commencement of Interest
              ------------------------------------------------------------
     Periods.  The Borrowers shall indemnify each Lender with respect to
     -------
     Eurocurrency Loans pursuant to Section 2.16.

          (d) Booking of Eurocurrency Rate Loans.  Any Lender may make, carry
              ----------------------------------
     or, subject to Section 9.04, transfer Eurocurrency Rate Loans at, to, or
     for the account of any of its branch offices or the office of an Affiliate
     of that Lender; provided that such making, carrying or transferring
     Eurocurrency Rate Loans does not result in any increase in costs or taxes
     to the Borrower pursuant to Section 2.20 over the amount that would
     otherwise be payable by the Borrower.

          (e) Assumptions Concerning Funding of Eurocurrency Rate Loans.
              ---------------------------------------------------------
     Calculation of all amounts payable to a Lender under this Section 2.08 and
     under Section 2.20 shall be made as though that Lender had actually funded
     each of its relevant Eurocurrency Rate Loans through the purchase of a
     deposit in Dollars or in an Alternative Currency, as applicable, bearing
     interest at the rate obtained pursuant to the definition of Eurocurrency
     Rate in an amount equal to the amount of such Eurocurrency Rate Loan and
     having a maturity comparable to the relevant Interest Period and through
     the transfer of such Eurocurrency deposit from an offshore office of that
     Lender to a domestic office of that Lender in the United States of America;
     provided, however, that each Lender may fund each of its Eurocurrency Rate
     Loans in any manner it sees fit and the foregoing assumptions shall be
     utilized only for the purposes of calculating amounts payable under this
     Section 2.08 and under Section 2.20.

          (f) Eurocurrency Rate Loans After Default.  After the occurrence of
              -------------------------------------
     and during the continuation of an Event of Default, (i) except as provided
     in Section 2.07, the Borrower may not elect to have a Loan be made or
     maintained as, or converted to, a Eurocurrency Rate Loan after the
     expiration of any Interest Period then in effect for that Loan and (ii)
     subject to the provisions of Section 2.08(c), any Notice of Borrowing or
     Notice of Conversion/Continuation given by the Borrower with respect to a
     requested borrowing or conversion/continuation that has not yet occurred
     shall be deemed to be rescinded by the Borrower.

     SECTION 2.09.  Termination and Reduction of Commitments.  (a)  The Term
Loan Commitments shall automatically terminate at 5:00 p.m., New York City time,
on the Closing Date. The Revolving Credit Commitments, the Swingline Commitment
and the L/C Commitment shall automatically terminate on the Revolving Credit
Maturity Date.  Notwithstanding the foregoing, all the Commitments shall
automatically terminate at 5:00 p.m., New York City time, on August 30, 2000, if
the initial Credit Event shall not have occurred by such time.
<PAGE>

                                      -33-

     (b) Upon at least three Business Days' prior irrevocable written or
telecopy notice to the Administrative Agent, the Borrower may at any time in
whole permanently terminate, or from time to time in part permanently reduce,
the Term Loan Commitments or the Revolving Credit Commitments; provided,
however, that (i) each partial reduction of the Term Loan Commitments or the
Revolving Credit Commitments shall be in an integral multiple of $1,000,000 and
in a minimum amount of $5,000,000 and (ii) the Total Revolving Credit Commitment
shall not be reduced to an amount that is less than the greater of the Aggregate
Revolving Credit Exposure at the time or $50,000,000.

     (c) Each reduction in the Term Loan Commitments or the Revolving Credit
Commitments hereunder shall be made ratably among the Lenders in accordance with
their respective applicable Commitments.  The Borrower shall pay to the
Administrative Agent for the account of the applicable Lenders, on the date of
each termination or reduction, the Commitment Fees on the amount of the
Commitments so terminated or reduced accrued to but excluding the date of such
termination or reduction.

     SECTION 2.10.  Conversion and Continuation of  Borrowings.  The Borrower
shall have the right subject to Sections 2.03 and 2.07 at any time upon prior
irrevocable notice to the Administrative Agent pursuant to a Notice of
Conversion/Continuation (a) not later than 11:00 am., New York City time, on the
day of conversion, to convert any LIBOR  Borrowing into an ABR Borrowing, (b)
not later than 11:00 a.m., New York City time, three Business Days prior to
conversion or continuation, to convert any ABR Borrowing into a LIBOR Borrowing
or to continue any LIBOR Borrowing as a LIBOR Borrowing for an additional
Interest Period, (c) not later than 11:00 a.m., New York City time, three
Business Days prior to conversion, to convert the Interest Period with respect
to any LIBOR  Borrowing to another permissible Interest Period, and (d) not
later than 12:00 noon, local time of the jurisdiction of such Alternative
Currency, at least four Business Days prior to conversion to convert the
Interest Period with respect to any EURIBOR Borrowing to another permissible
Interest Period subject in each case to the following:

            (i)      each conversion or continuation shall be made pro rata
     among the Lenders in accordance with the respective principal amounts of
     the Loans comprising the converted or continued Borrowing;

            (ii)     if less than all the outstanding principal amount of any
     Borrowing shall be converted or continued, then each resulting Borrowing
     shall satisfy the limitations specified in Sections 2.02(a) and 2.02(b)
     regarding the principal amount and maximum number of Borrowings of the
     relevant Type;

            (iii)    each conversion shall be effected by each Lender and the
     Administrative Agent by recording for the account of such Lender the new
     Loan of such Lender resulting from such conversion and reducing the Loan
     (or portion thereof) of such Lender being converted by an equivalent
     principal amount; accrued interest on any LIBOR Loan (or portion thereof)
     being converted shall be paid by the Borrower at the time of conversion;

            (iv)     if any LIBOR Borrowing is converted at a time other than
     the end of the Interest Period applicable thereto, the Borrower shall pay,
     upon demand, any amounts due to the Lenders pursuant to Sections 2.08(c)
     and 2.16;

            (v)      any portion of a Borrowing maturing or required to be
     repaid in less than one month may not be converted into or continued as a
     LIBOR Borrowing;
<PAGE>

                                      -34-

            (vi)     any portion of a LIBOR Borrowing that cannot be converted
     into or continued as a LIBOR Borrowing by reason of the immediately
     preceding clause shall be automatically converted at the end of the
     Interest Period in effect for such Borrowing into an ABR Borrowing;

            (vii)    EURIBOR Borrowings may only be continued as EURIBOR
     Borrowings and in the event the Borrower fails to select a new Interest
     Period at expiration of the applicable Interest Period, the Borrower shall
     be deemed to have selected an Interest Period of one month; and

             (viii)  an Alternative Currency Loan cannot be converted pursuant
     to this Section 2.10 from the currency in which it was initially made to
     another Alternative Currency.

     Each notice pursuant to this Section 2.10 shall be irrevocable and shall
refer to this Agreement and specify (i) the identity and amount of the Borrowing
that the Borrower requests be converted or continued, (ii) whether such
Borrowing is to be converted to or continued as a LIBOR Borrowing, a EURIBOR
Borrowing or an ABR Borrowing, (iii) if such notice requests a conversion, the
date of such conversion (which shall be a Business Day) and (iv) if such
Borrowing is to be converted to or continued as a LIBOR Borrowing or a EURIBOR
Borrowing, the Interest Period with respect thereto.

     SECTION 2.11.  Repayment of Term Borrowings. (a) (i) The Borrower shall pay
to the Administrative Agent, for the account of the Lenders, on the dates set
forth below, or if any such date is not a Business Day, on the next preceding
Business Day (each such date being a "Tranche A Term Loan Repayment Date"), an
amount of the Tranche A Term Loans (as adjusted from time to time pursuant to
Sections 2.11(b), 2.12 and 2.13(g)) equal to the percentage of the original
principal amount of the Tranche A Term Loans set forth below for such date,
together in each case with accrued and unpaid interest on the principal amount
to be paid to but excluding the date of such payment:

          Date                                        Percentage
          ----                                        ----------
          September 30, 2000                             2.174%
          December 31, 2000                              2.174%
          March 31, 2001                                 2.174%
          June 30, 2001                                  2.174%
          September 30, 2001                             3.260%
          December 31, 2001                              3.260%
          March 31, 2002                                 3.260%
          June 30, 2002                                  3.260%
          September 30, 2002                             4.348%
          December 31, 2002                              4.348%
          March 31, 2003                                 4.348%
          June 30, 2003                                  4.348%
          September 30, 2003                             4.348%
          December 31, 2003                              4.348%
          March 31, 2004                                 4.348%
          June 30, 2004                                  4.348%
          September 30, 2004                             5.435%
          December 31, 2004                              5.435%
          March 31, 2005                                 5.435%
<PAGE>

                                      -35-

          Date                                        Percentage
          ----                                        ----------
          June 30, 2005                                  5.435%
          September 30, 2005                             5.435%
          December 31, 2005                              5.435%
          March 30, 2006                                 5.435%
          Tranche A Maturity Date                        5.435%

       (ii) The Borrower shall pay to the Administrative Agent, for the account
of the Lenders, on the dates set forth below or, if any such date is not a
Business Day, on the next preceding Business Day (each such date being a
"Tranche B Term Loan Repayment Date"), an amount of the Tranche B Term Loans (as
adjusted from time to time pursuant to Sections 2.11(b), 2.12 and 2.13(g)) equal
to the percentage of the original principal amount of the Tranche B Term Loans
set forth below for such date, together in each case with accrued and unpaid
interest on the principal amount to be paid to but excluding the date of such
payment:

          Date                                         Percentage
          ----                                         ----------
          September 30, 2000                             0.2325%
          December 31, 2000                              0.2325%
          March 31, 2001                                 0.2325%
          June 30, 2001                                  0.2325%
          September 30, 2001                             0.2325%
          December 31, 2001                              0.2325%
          March 31, 2002                                 0.2325%
          June 30, 2002                                  0.2325%
          September 30, 2002                             0.2325%
          December 31, 2002                              0.2325%
          March 31, 2003                                 0.2325%
          June 30, 2003                                  0.2325%
          September 30, 2003                             0.2325%
          December 31, 2003                              0.2325%
          March 31, 2004                                 0.2325%
          June 30, 2004                                  0.2325%
          September 30, 2004                             0.2325%
          December 31, 2004                              0.2325%
          March 31, 2005                                 0.2325%
          June 30, 2005                                  0.2325%
          September 30, 2005                             0.2325%
          December 31, 2005                              0.2325%
          March 31, 2006                                 0.2325%
          June 30, 2006                                  0.2325%
          September 30, 2006                              8.721%
          December 31, 2006                               8.721%
          March 31, 2007                                  8.721%
          June 30, 2007                                   8.721%
          September 30, 2007                             14.884%
          December 31, 2007                              14.884%
<PAGE>

                                      -36-

          Date                                         Percentage
          ----                                         ----------
          March 31, 2008                                 14.884%
          Tranche B Maturity Date                        14.884%

       (iii)  The Borrower shall pay to the Administrative Agent, for the
account of the Lender, an amount of the Tranche C Term Loans in equal quarterly
installments payable at the end of each quarter (commencing with the end of the
first full calendar quarter following the Tranche C Term Loan Draw Date)
aggregating 1.0% per year of the aggregate principal amount of Tranche C Term
Loans outstanding on the Tranche C Term Loan Draw Date, except for the final
year during which the Borrower will pay one-quarter of the remaining principal
amount outstanding of the Tranche C Term Loans at the end of each calendar
quarter of such final year (provided that if such date is not a Business Day,
the installment shall be paid on the preceding Business Day); provided that the
scheduled installments of principal of the Tranche C Term Loans set forth above
shall be reduced on a pro rata basis in connection with any voluntary or
mandatory prepayments of the Tranche C Term Loans in accordance with Sections
2.12 or 2.13; provided, further that the final installment specified above for
the repayment by the Borrower of the Tranche C Term Loans shall be in an amount,
if such amount is different from that specified above, sufficient to repay all
amounts owing by the Borrower under this Agreement with respect to the Tranche C
Term Loans.

     (b) In the event and on each occasion that any Tranche A Commitment or
Tranche B Commitment shall be reduced or shall expire or terminate other than as
a result of the making of a Tranche A Term Loan or a Tranche B Term Loan, as the
case may be, the installments payable on each Tranche A Term Loan Repayment Date
and each Tranche B Term Loan Repayment Date, as the case may be, shall be
reduced pro rata by an aggregate amount equal to the amount of such reduction,
expiration or termination.

     (c) To the extent not previously paid, all Tranche A Term Loans and Tranche
B Term Loans shall be due and payable on the Tranche A Maturity Date and Tranche
B Maturity Date, respectively, together with accrued and unpaid interest on the
principal amount to be paid to but excluding the date of payment.

     (d) All repayments pursuant to this Section 2.11 shall be subject to
Section 2.16, but shall otherwise be without premium or penalty.

     SECTION 2.12. Prepayment. (a) The Borrower shall have the right at any
time and from time to time to prepay any Borrowing, in whole or in part, upon at
least four Business Days' prior written or telecopy notice (or telephone notice
promptly confirmed by written or telecopy notice) in the case of Eurocurrency
Loans, or written or telecopy notice (or telephone notice promptly confirmed by
written or telecopy notice) on or prior to the date of prepayment in the case of
ABR Loans, to the Administrative Agent before 11:00 a.m., New York City time;
provided, however, that each partial prepayment shall be in an amount that is an
integral multiple of $1,000,000 (or the Alternative Currency Equivalent thereof)
and not less than $5,000,000 (or the Alternative Currency Equivalent thereof).

     (b) Optional prepayments of Term Loans shall be first allocated and applied
pro rata with respect to the next scheduled installment of principal due in
respect of the Tranche A Term Loans, Tranche B Term Loans and Tranche C Term
Loans under Sections 2.11(a)(i), (ii) and (iii), respectively and thereafter
allocated pro rata to the then outstanding Tranche A Term Loans, Tranche B Term
Loans and Tranche C Term Loans (after giving effect to the prepayments applied
with respect to the next scheduled installment) and applied pro rata against the
remaining scheduled installments of principal due in respect of the Tranche A
Term Loans, Tranche B Term Loans and Tranche C Term Loans under Sections
2.11(a)(i), (ii) and (iii), respectively; pro-
<PAGE>

                                      -37-

vided, Lenders of the Tranche B Term Loans shall have the right (to the extent
Tranche A Term Loans remain outstanding after giving effect to such prepayment
of the Tranche A Term Loans) to waive any such prepayment (other than applied to
the next scheduled prepayment) by giving notice to the Administrative Agent at
least three Business Days prior to the prepayment, in which case the waived
portion of any such prepayment will be allocated to the Tranche A Term Loan.

     (c) Each notice of prepayment (i) shall specify the prepayment date and the
principal amount of each Borrowing (or portion thereof) to be prepaid, (ii)
shall be irrevocable and (iii) shall commit the Borrower to prepay such
Borrowing by the amount stated therein on the date stated therein.  All
prepayments under this Section 2.12 shall be subject to Sections 2.08(c) and
2.16 but otherwise without premium or penalty.  All prepayments under this
Section 2.12 shall be accompanied by accrued interest on the principal amount
being prepaid to the date of payment.

     SECTION 2.13. Mandatory Prepayments. (a) In the event of any termination of
all the Revolving Credit Commitments, the Borrower shall, on the date of such
termination, repay or prepay all its outstanding Revolving Credit Borrowings and
all outstanding Swingline Loans and replace all outstanding Letters of Credit
and/or deposit an amount equal to the L/C Exposure in cash in a cash collateral
account established with the Collateral Agent for the benefit of the Secured
Parties. In the event of any partial reduction of the Revolving Credit
Commitments, then (i) at or prior to the effective date of such reduction, the
Administrative Agent shall notify the Borrower and the Revolving Credit Lenders
of the Aggregate Revolving Credit Exposure after giving effect thereto and (ii)
if the Aggregate Revolving Credit Exposure would exceed the Total Revolving
Credit Commitment after giving effect to such reduction or termination, then the
Borrower shall, on the date of such reduction or termination, repay or prepay
Revolving Credit Borrowings or Swingline Loans (or a combination thereof) and/or
replace or cash collateralize outstanding Letters of Credit in an amount
sufficient to eliminate such excess.

     (b) Not later than the third Business Day following the receipt of any Net
Cash Proceeds of any Asset Sale, the Borrower shall apply 100% of the Net Cash
Proceeds received with respect thereto to prepay outstanding Term Loans in
accordance with Section 2.13(g), other than (i) an aggregate of $10.0 million in
Net Cash Proceeds of Asset Sales consummated after the Closing Date and (ii) an
additional $20.0 million of the Net Cash Proceeds of any Asset Sale consummated
with respect to the assets set forth on Schedule 2.13(b) hereto, provided, that,
for purposes of this clause (ii), on a pro forma basis for any such sale such
Senior Leverage Ratio shall be less than 2.00:1.00 on the date of such sale.

     (c) If the Senior Leverage Ratio is equal to or greater than 2.00:1.00 on
the date of the consummation of an Equity Offering (after giving effect to the
application of the proceeds of such Equity Offering), then the Borrower shall,
substantially simultaneously with (and in any event not later than the third
Business Day next following) the consummation of such Equity Offering, apply 50%
of the Net Cash Proceeds therefrom to prepay outstanding Term Loans in
accordance with Section 2.13(g); provided, no prepayment of Term Loans shall be
required pursuant to this Section 2.13(c) if the Senior Leverage Ratio is less
than 2.00:1.00 on such date.

     (d) No later than 100 days after the end of each fiscal year of the
Borrower, commencing with the fiscal year ending on August 31, 2001, the
Borrower shall prepay outstanding Term Loans in accordance with Section 2.13(g)
in an aggregate principal amount equal to 50% of Excess Cash Flow for the fiscal
year then ended minus any amounts prepaid pursuant to Section 2.12 during such
fiscal year; provided, no prepayment of Term Loans shall be required pursuant to
this Section 2.13(d) if the Leverage Ratio is less than 3.00:1.00 as of the end
of such fiscal year; provided, further, however, notwithstanding the foregoing,
in any event the Borrower
<PAGE>

                                      -38-

shall prepay outstanding Term Loans to the extent of any amount that would
otherwise be required to be applied to an Excess Cash Flow Offer (as defined in
the New Senior Subordinated Note Indenture).

     (e) In the event that any Loan Party or any subsidiary of a Loan Party
shall receive Net Cash Proceeds from the issuance or other disposition of
Indebtedness for money borrowed of any Loan Party or any subsidiary of a Loan
Party (other than Indebtedness permitted pursuant to Sections 6.01(a), (b), (d),
(e), (f), (g), (h), (i) and (j)), the Borrower shall, substantially
simultaneously with (and in any event not later than the third Business Day next
following) the receipt of such Net Cash Proceeds by such Loan Party or such
subsidiary, (x) apply an amount equal to 100% of such Net Cash Proceeds of
Indebtedness incurred pursuant to Section 6.01(l) to prepay outstanding Term
Loans, (y) if the Senior Leverage Ratio is equal to or greater than 2.00:1.00 on
the date of the issuance or disposition of all other Indebtedness, then apply an
amount equal to 100% of such Net Cash Proceeds of such other Indebtedness
incurred to prepay outstanding Term Loans and (z) if the Senior Leverage Ratio
is less than 2.00:1.00 on the date of any issuance or disposition of
Indebtedness incurred pursuant to Section 6.01(k), apply an amount equal to 50%
of the Net Cash Proceeds of such other Indebtedness to prepay outstanding Term
Loans, in any case of (x),(y) or (z) in accordance with Section 2.13(g).

     (f) In the event that there shall occur any Casualty Event and, pursuant to
the applicable Security Document, the Net Cash Proceeds with respect thereto are
required to be used to prepay the Term Loans, then the Borrower shall apply an
amount equal to 100% of such Net Cash Proceeds to prepay outstanding Term Loans
in accordance with Section 2.13(g).

     (g) Mandatory prepayments of outstanding Term Loans under this Agreement
shall be allocated pro rata between the then-outstanding Tranche A Term Loans,
Tranche B Term Loans and Tranche C Term Loans, if any, and, subject to paragraph
(j) below, applied pro rata against the remaining scheduled installments of
principal due in respect of Tranche A Term Loans, Tranche B Term Loans and
Tranche C Term Loans, if any, under Sections 2.11(a)(i), (ii) and (iii),
respectively.

     (h) The Borrower shall deliver to the Administrative Agent, at the time of
each prepayment required under this Section 2.13, (i) a certificate signed by a
Financial Officer of the Borrower setting forth in reasonable detail the
calculation of the amount of such prepayment and (ii) to the extent practicable,
at least three days prior written notice of such prepayment.  Each notice of
prepayment shall specify the prepayment date, the Type of each Loan being
prepaid and the principal amount of each Loan (or portion thereof) to be
prepaid.  All prepayments of Borrowings under this Section 2.13 shall be subject
to Sections 2.08(c) and 2.16, but shall otherwise be without premium or penalty.

     (i) Amounts to be applied pursuant to this Section 2.13 shall be allocated
pro rata with respect to the then-outstanding Tranche A Term Loans, Tranche B
Term Loans, and Tranche C Term Loans and applied pro rata against the remaining
scheduled installments of principal due in respect of the Tranche A Term Loans,
Tranche B Term Loans and Tranche C Term Loans under Section 2.11(a)(i), (ii) and
(iii), respectively.  Except in the case of payments to be applied to Tranche B
Term Loans (which shall be applied immediately to the outstanding amounts of the
Tranche B Term Loans), amounts to be applied pursuant to this Section 2.13 shall
be applied immediately to any outstanding ABR Term Loans and, at the option of
the Borrower, be applied immediately to any outstanding LIBOR Term Loans, in
accordance with this paragraph (i) and paragraph (j), and/or shall be deposited
in the Prepayment Account (as defined below).  The Administrative Agent shall
apply any cash deposited in the Prepayment Account (i) allocable to Term Loans
to prepay LIBOR Term Loans and (ii) allocable to Revolving Loans to prepay LIBOR
Revolving Loans, in each case on the last day of their respective Interest
Periods (or, at the direction of the Borrower, on any earlier date) until all
outstanding Term Loans or Revolving Loans, as the case may be, have been prepaid
or until all the allocable cash on deposit with
<PAGE>

                                      -39-

respect to such Loans has been exhausted. For purposes of this Agreement, the
term "Prepayment Account" shall mean an account established by the Borrower with
the Administrative Agent and over which the Administrative Agent shall have
exclusive dominion and control, including the exclusive right of withdrawal for
application in accordance with this paragraph (i). The Administrative Agent
will, at the request of the Borrower, invest amounts on deposit in the
Prepayment Account in Cash Equivalents that mature prior to the last day of the
applicable Interest Periods of the Eurocurrency Term Borrowings or LIBOR
Revolving Borrowings to be prepaid, as the case may be; provided, however, that
(i) the Administrative Agent shall not be required to make any investment that,
in its sole judgment, would require or cause the Administrative Agent to be in,
or would result in any, violation of any law, statute, rule or regulation and
(ii) the Administrative Agent shall have no obligation to invest amounts on
deposit in the Prepayment Account if a Default or Event of Default shall have
occurred and be continuing. The Borrower shall indemnify the Administrative
Agent for any losses relating to the investments so that the amount available to
prepay Eurocurrency Rate Borrowings on the last day of the applicable Interest
Period is not less than the amount that would have been available had no
investments been made pursuant thereto. Other than any interest earned on such
investments, the Prepayment Account shall not bear interest. Interest or
profits, if any, on such investments shall be deposited in the Prepayment
Account and reinvested and disbursed as specified above. If the maturity of the
Loans has been accelerated pursuant to Article VII, the Administrative Agent
may, in its sole discretion, apply all amounts on deposit in the Prepayment
Account to satisfy any of the Obligations. The Borrower hereby grants to the
Administrative Agent, for its benefit and the benefit of the Issuing Bank and
the Lenders, a security interest in the Prepayment Account to secure the
Obligations.

     (j) Any Lender of Tranche B Term Loans may elect, by notice to the
Administrative Agent in writing (or by telecopy or telephone promptly confirmed
in writing) by 11:00 a.m., New York City time, at least three Business Days
prior to any prepayment of Tranche B Term Loans required to be made by the
Borrower for the account of such Lender pursuant to this Section 2.13, to cause
all or a portion of such prepayment to be applied instead to prepay Tranche A
Term Loans (to the extent Tranche A Term Loans remain outstanding after giving
effect to such prepayment of the Tranche A Term Loans) in accordance with
paragraph (g) above.  Any amounts remaining after the Tranche A Term Loans,
Tranche B Term Loans and Tranche C Term Loans have been paid in full shall be
applied to any outstanding ABR Revolver Loans and then to any outstanding LIBOR
Revolving Loans pursuant to paragraph (i) above.  Amounts used to prepay
Revolving Loans pursuant to this Section 2.13 may not be reborrowed and the
Revolving Credit Commitment shall be permanently reduced by an equivalent
amount.

     SECTION 2.14.  Reserve Requirements; Change in Circumstances.  (a)
Notwithstanding any other provision of this Agreement, if after the date of this
Agreement any change in applicable law or regulation or in the interpretation or
administration thereof by any Governmental Authority charged with the
interpretation or administration thereof (whether or not having the force of
law) shall impose, modify or deem applicable any reserve, special deposit or
similar requirement against assets of, deposits with or for the account of or
credit extended by any Lender or the Issuing Bank (except any such reserve
requirement which is reflected in the Adjusted EURIBOR or the Adjusted LIBOR) or
shall impose on such Lender or the Issuing Bank or the London interbank market
any other condition affecting this Agreement or Eurocurrency Loans made by such
Lender or any Letter of Credit or participation therein, and the result of any
of the foregoing shall be to increase the cost to such Lender or the Issuing
Bank of making or maintaining any Eurocurrency Loan or increase the cost to any
Lender of issuing or maintaining any Letter of Credit or purchasing or
maintaining a participation therein or to reduce the amount of any sum received
or receivable by such Lender or the Issuing Bank hereunder (whether of
principal, interest or otherwise) by an amount deemed by such Lender or  the
Issuing Bank to be material, then the Borrower will pay to such Lender or the
Issuing Bank, as the case may be, upon demand such additional amount or amounts
as will compensate such Lender or the Issuing Bank, as the case may be, for such
additional costs incurred or reduction suffered.
<PAGE>

                                      -40-

     (b) If any Lender or the Issuing Bank shall have determined that the
adoption after the date hereof of any law, rule, regulation, agreement or
guideline regarding capital adequacy, or any change after the date hereof in any
such law, rule, regulation, agreement or guideline (whether such law, rule,
regulation, agreement or guideline has been adopted) or in the interpretation or
administration thereof by any Governmental Authority charged with the
interpretation or administration thereof, or compliance by any Lender (or any
lending office of such Lender) or the Issuing Bank or any Lender's or the
Issuing Bank's holding company with any request or directive regarding capital
adequacy (whether or not having the force of law) of any Governmental Authority
has or would have the effect of reducing the rate of return on such Lender's or
the Issuing Bank's capital or on the capital of such Lender's or the Issuing
Bank's holding company, if any, as a consequence of this Agreement or the Loans
made or participations in Letters of Credit purchased by such Lender pursuant
hereto or the Letters of Credit issued by the Issuing Bank pursuant hereto to a
level below that which such Lender or the Issuing Bank or such Lender's or the
Issuing Bank's holding company could have achieved but for such applicability,
adoption, change or compliance (taking into consideration such Lender's or the
Issuing Bank's policies and the policies of such Lender's or the Issuing Bank's
holding company with respect to capital adequacy) by an amount deemed by such
Lender or the Issuing Bank to be material, then from time to time the Borrower
shall pay to such Lender or the Issuing Bank, as the case may be, such
additional amount or amounts as will compensate such Lender or the Issuing Bank
or such Lender's or the Issuing Bank's holding company for any such reduction
suffered.

     (c) A certificate of a Lender or the Issuing Bank, setting forth in
reasonable detail the reason therefor, the amount or amounts necessary to
compensate such Lender or the Issuing Bank or its holding company, as
applicable, as specified in paragraph (a) or (b) above, and the calculation
thereof, shall be delivered to the Borrower and shall be conclusive absent
manifest error.  The Borrower shall pay such Lender or the Issuing Bank the
amount shown as due on any such certificate delivered by it within 10 days after
its receipt of the same.

     (d) Failure or delay on the part of any Lender or the Issuing Bank to
demand compensation for any increased costs or reduction in amounts received or
receivable or reduction in return on capital shall not constitute a waiver of
such Lender's or the Issuing Bank's right to demand such compensation; provided
that the Borrower shall not be under any obligation to compensate any Lender or
the Issuing Bank under paragraph (a) or (b) above with respect to increased
costs or reductions with respect to any period prior to the date that is four
months prior to such request if such Lender or the Issuing Bank knew or could
reasonably have been expected to be aware of the circumstances giving rise to
such increased costs or reductions and of the fact that such circumstances would
in fact result in a claim for increased compensation by reason of such increased
costs or reductions; provided further that the foregoing limitation shall not
apply to any increased costs or reductions arising out of the retroactive
application of any law, regulation, rule, guideline or directive as aforesaid
within such four-month period.  The protection of this Section 2.14 shall be
available to each Lender and the Issuing Bank regardless of any possible
contention of the invalidity or inapplicability of the law, rule, regulation,
agreement, guideline or other change or condition that shall have occurred or
been imposed.

     SECTION 2.15.  Change in Legality.  (a)  Notwithstanding any other
provision of this Agreement, if, after the date hereof, any change in any law or
regulation or in the interpretation thereof by any Governmental Authority
charged with the administration or interpretation thereof shall make it unlawful
for any Lender to make or maintain any Eurocurrency Loan or Alternative Currency
Loan, or to give effect to its obligations as contemplated hereby with respect
to any Eurocurrency Loan, then, by written notice to the Borrower and to the
Administrative Agent:
<PAGE>

                                      -41-

            (i)  such Lender may declare that Eurocurrency Loans will not
     thereafter (for the duration of such unlawfulness) be made by such Lender
     hereunder (or be continued for additional Interest Periods and ABR Loans
     will not thereafter (for such duration) be converted into LIBOR Loans),
     whereupon any request for a Eurocurrency Borrowing (or to convert an ABR
     Borrowing to a LIBOR Borrowing or to continue a LIBOR Borrowing or EURIBOR
     Borrowing for an additional Interest Period) shall, as to such Lender only,
     be deemed a request for an ABR Loan (or a request to continue an ABR Loan
     as such for an additional Interest Period or to convert a LIBOR Loan into
     an ABR Loan, as the case may be), unless such declaration shall be
     subsequently withdrawn; and

            (ii) such Lender may require that all outstanding LIBOR Loans made
     by it be converted to ABR Loans and all EURIBOR Term Loans made by it
     converted to ABR Loans (with all remaining payment obligations of the
     Borrower with respect thereto denominated in Dollars based on the Dollar
     Equivalent of the outstanding amounts on the date of such conversion), in
     which event all such LIBOR Loans and EURIBOR Term Loans shall be
     automatically converted to ABR Loans as of the effective date of such
     notice as provided in paragraph (b) below.

     In the event any Lender shall exercise its rights under (i) or (ii) above,
all payments and prepayments of principal that would otherwise have been applied
to repay the Eurocurrency Loans that would have been made by such Lender or the
converted LIBOR Loans of such Lender shall instead be applied to repay the ABR
Loans made by such Lender in lieu of, or resulting from the conversion of, such
Eurocurrency Loans.

     (b) For purposes of this Section 2.15, a notice to the Borrower by any
Lender shall be effective as to each Eurocurrency Loan made by such Lender, if
lawful, on the last day of the Interest Period currently applicable to such
Eurocurrency Loan; in all other cases such notice shall be effective on the date
of receipt by the Borrower.

     SECTION 2.16.  Indemnity. The Borrower shall indemnify each Lender against
any loss or expense that such Lender may sustain or incur as a consequence of
(a) any event, other than a default by such Lender in the performance of its
obligations hereunder, which results in (i) such Lender receiving or being
deemed to receive any amount on account of the principal of any Eurocurrency
Loan prior to the end of the Interest Period in effect therefor, (ii) the
conversion of any LIBOR Loan to an ABR Loan, or the conversion of the Interest
Period with respect to any Eurocurrency Loan, in each case other than on the
last day of the Interest Period in effect therefor, or (iii) any Eurocurrency
Loan to be made by such Lender (including any LIBOR Loan to be made pursuant to
a conversion or continuation under Section 2.10) not being made after notice of
such Loan shall have been given by the Borrower hereunder (any of the events
referred to in this clause (a) being called a "Breakage Event") or (b) any
default in the making of any payment or prepayment required to be made
hereunder. In the case of any Breakage Event, such loss shall include an amount
equal to the excess, as reasonably determined by such Lender, of (i) its cost of
obtaining funds for the Eurocurrency Loan that is the subject of such Breakage
Event for the period from the date of such Breakage Event to the last day of the
Interest Period in effect (or that would have been in effect) for such Loan over
(ii) the amount of interest likely to be realized by such Lender in redeploying
the funds released or not utilized by reason of such Breakage Event for such
period. A certificate of any Lender setting forth any amount or amounts which
such Lender is entitled to receive pursuant to this Section 2.16 shall be
delivered to the Borrower and shall be conclusive absent manifest error.

     SECTION 2.17.  Pro Rata Treatment.  Except as provided below in this
Section 2.17 with respect to Swingline Loans and as required under Sections
2.13(j) and 2.15, each Borrowing, each payment or prepayment of principal of any
Borrowing, each payment of interest on the Loans, each payment of the Commitment
Fees, each reduction of the Term Loan Commitments or the Revolving Credit
Commitments  and each  conversion of
<PAGE>

                                      -42-

any Borrowing to or continuation of any Borrowing as a Borrowing of any Type
shall be allocated pro rata among the Lenders in accordance with their
respective applicable Commitments (or, if such Commitments shall have expired or
been terminated, in accordance with the respective principal amounts of their
outstanding Loans). For purposes of determining the available Revolving Credit
Commitments of the Lenders at any time, each outstanding Swingline Loan shall be
deemed to have utilized the Revolving Credit Commitments of the Lenders
(including those Lenders which shall not have made Swingline Loans) pro rata in
accordance with such respective Revolving Credit Commitments. Each Lender agrees
that in computing such Lender's portion of any Borrowing to be made hereunder,
the Administrative Agent may, in its discretion, round each Lender's percentage
of such Borrowing to the next higher or lower whole dollar amount.

     SECTION 2.18.  Sharing of Setoffs.  Each Lender agrees that if it shall,
through the exercise of a right of banker's lien, setoff or counterclaim against
the Borrower or any other Loan Party, or pursuant to a secured claim under
Section 506 of Title 11 of the United States Code or other security or interest
arising from, or in lieu of, such secured claim, received by such Lender under
any applicable bankruptcy, insolvency or other similar law or otherwise, or by
any other means, obtain payment (voluntary or involuntary) in respect of any
Loan or Loans or L/C Disbursement as a result of which the unpaid principal
portion of its Tranche A Term Loans, Tranche B Term Loans and Revolving Loans
and participations in L/C Disbursements shall be proportionately less than the
unpaid principal portion of the Tranche A Term Loans, Tranche B Term Loans and
Revolving Loans and participations in L/C Disbursements of any other Lender, it
shall be deemed simultaneously to have purchased from such other Lender at face
value, and shall promptly pay to such other Lender the purchase price for, a
participation in the Tranche A Term Loans, Tranche B Term Loans and Revolving
Loans and L/C Exposure, as the case may be, of such other Lender, so that the
aggregate unpaid principal amount of the Tranche A Term Loans, Tranche B Term
Loans and Revolving Loans and L/C Exposure and participations in Tranche A Term
Loans, Tranche B Term Loans and Revolving Loans and L/C Exposure held by each
Lender shall be in the same proportion to the aggregate unpaid principal amount
of all Tranche A Term Loans, Tranche B Term Loans and Revolving Loans and L/C
Exposure then outstanding as the principal amount of its Tranche A Term Loans,
Tranche B Term Loans and Revolving Loans and L/C Exposure prior to such exercise
of banker's lien, setoff or counterclaim or other event was to the principal
amount of all Tranche A Term Loans, Tranche B Term Loans and Revolving Loans and
L/C Exposure outstanding prior to such exercise of banker's lien, setoff or
counterclaim or other event; provided, however, that if any such purchase or
purchases or adjustments shall be made pursuant to this Section 2.18 and the
payment giving rise thereto shall thereafter be recovered, such purchase or
purchases or adjustments shall be rescinded to the extent of such recovery and
the purchase price or prices or adjustment restored without interest.  The
Borrower expressly consents to the foregoing arrangements and agrees that any
Lender holding a participation in a Term Loan or Revolving Loan or L/C
Disbursement deemed to have been so purchased may exercise any and all rights of
banker's lien, setoff or counterclaim with respect to any and all moneys owing
by the Borrower to such Lender by reason thereof as fully as if such Lender had
made a Loan directly to the Borrower in the amount of such participation.

     SECTION 2.19.  Payments.  (a)  The Borrower shall make each payment
(including principal of or interest on any Borrowing or any L/C Disbursement or
any Fees or other amounts) hereunder and under any other Loan Document not later
than 12:00 (noon), New York City time, on the date when due in immediately
available dollars, without setoff, defense or counterclaim.  Each such payment
(other than (i) Issuing Bank Fees, which shall be paid directly to the Issuing
Bank, and (ii) principal of and interest on Swingline Loans, which shall be paid
directly to the Swingline Lender except as otherwise provided in Section
2.22(e)) shall be made to the Administrative Agent at its offices at Eleven
Madison Avenue, New York, New York or as otherwise specified to be promptly
distributed by the Administrative Agent as provided in Article VIII.
<PAGE>

                                      -43-

     (b) Except as otherwise expressly provided herein, whenever any payment
(including principal of or interest on any Borrowing or any Fees or other
amounts) hereunder or under any other Loan Document shall become due, or
otherwise would occur, on a day that is not a Business Day, such payment may be
made on the next succeeding Business Day, and such extension of time shall in
such case be included in the computation of interest or Fees, if applicable.

     (c) All payments of principal and interest with respect to Alternative
Currency Loans shall be made in the applicable Alternative Currency unless such
Loans shall have been converted pursuant to Section 2.15(a)(ii).

     SECTION 2.20.  Taxes.  (a)  Any and all payments by or on account of any
obligation of the Borrower or any Loan Party hereunder or under any other Loan
Document shall be made free and clear of and without deduction for any
Indemnified Taxes or Other Taxes; provided that if the Borrower or any Loan
Party shall be required to deduct any Indemnified Taxes or Other Taxes from such
payments, then (i) the sum payable shall be increased as necessary so that after
making all required deductions (including deductions applicable to additional
sums payable under this Section) the Administrative Agent or such Lender (as the
case may be) receives an amount equal to the sum it would have received had no
such deductions been made, (ii) the Borrower or such Loan Party shall make such
deductions and (iii) the Borrower or such Loan Party shall pay the full amount
deducted to the relevant Governmental Authority in accordance with applicable
law.

     (b) In addition, the Borrower shall pay any Other Taxes to the relevant
Governmental Authority in accordance with applicable law.

     (c) The Borrower shall indemnify  the Administrative Agent and each Lender,
within 10 days after written demand therefor, for the full amount of any
Indemnified Taxes or Other Taxes paid by the Administrative Agent or such
Lender, as the case may be, on or with respect to any payment by or on account
of any obligation of the Borrower or any Loan Party hereunder or under any other
Loan Document (including Indemnified Taxes or Other Taxes imposed or asserted on
or attributable to amounts payable under this Section) and any penalties,
interest and reasonable expenses arising therefrom or with respect thereto,
whether or not such Indemnified Taxes or Other Taxes were correctly or legally
imposed or asserted by the relevant Governmental Authority.  A certificate as to
the amount of such payment or liability delivered to the Borrower by a Lender,
or by  the Administrative Agent on its behalf or on behalf of a Lender, shall be
conclusive absent manifest error.

     (d) As soon as practicable after any payment of Indemnified Taxes or Other
Taxes by the Borrower or any other Loan Party to a Governmental Authority, the
Borrower shall deliver to the Administrative Agent the original or a certified
copy of a receipt issued by such Governmental Authority evidencing such payment,
a copy of the return reporting such payment or other evidence of such payment
reasonably satisfactory to the Administrative Agent.

     (e) Any Foreign Lender that is entitled to an exemption from or reduction
of withholding tax under the law of the jurisdiction in which the Borrower is
located, or any treaty to which such jurisdiction is a party, with respect to
payments under this Agreement shall deliver to the Borrower (with a copy to the
Administrative Agent), at the time or times prescribed by applicable law, such
properly completed and executed documentation prescribed by applicable law as
will permit such payments to be made without withholding or at a reduced rate.

     (f) If the Administrative Agent or any Lender receives a refund in respect
of Indemnified Taxes or Other Taxes paid by the Borrower, which in the good
faith judgment of the Administrative Agent or such
<PAGE>

                                      -44-

Lender is allocable to such payment, it shall promptly pay such refund, together
with any other amounts paid by the Borrower in connection with such refunded
Indemnified Taxes or Other Taxes, to the Borrower, net of all out-of-pocket
expenses (including any Taxes to which such Lender has become subject as a
result of its receipt of such refund) of the Administrative Agent or such Lender
incurred in obtaining such refund and without interest (other than any interest
paid by the relevant Governmental Authority with respect to such refund);
provided, however, that the Borrower agrees to promptly return such refund (plus
any penalties, interest or other charges imposed by the relevant Governmental
Authority) to the Administrative Agent or the applicable Lender, as the case may
be, if it receives notice from the Administrative Agent or the applicable Lender
that the Administrative Agent or such Lender is required to repay such refund to
such Governmental Authority. Nothing contained in this Section 2.20(f) shall
require the Administrative Agent or any Lender to make available its tax returns
(or any other information relating to its taxes which it deems to be
confidential) to the Borrower or any other person.

     (g) Notwithstanding anything to the contrary in this Section, if the
Internal Revenue Service determines that a Lender is participating in a conduit
financing arrangement as defined in Section 7701(l) of the Code and the
regulations thereunder (a "Conduit Financing Arrangement"), then (i) any Taxes
that the Borrower is required to withhold from payments to such Lender shall be
excluded from the definition of "Indemnified Taxes" and (ii) such Lender shall
indemnify the Borrower in full for any and all Taxes for which the Borrower is
held directly liable under Section 1461 of the Code by virtue of such Conduit
Financing Arrangement.  Each Lender represents that it is not participating in a
Conduit Financing Arrangement.

     SECTION 2.21.  Assignment of Commitments Under Certain Circumstances; Duty
to Mitigate.  (a)  In the event (i) any Lender or the Issuing Bank delivers a
certificate requesting compensation pursuant to Section 2.14, (ii) any Lender or
the Issuing Bank delivers a notice described in Section 2.15 or (iii) the
Borrower is required to pay any additional amount to any Lender or the Issuing
Bank or any Governmental Authority on account of any Lender or the Issuing Bank
pursuant to Section 2.20, the Borrower may, at its sole expense and effort
(including with respect to the processing and recordation fee referred to in
Section 9.04(b)), upon notice to such Lender or the Issuing Bank and the
Administrative Agent, require such Lender or the Issuing Bank to transfer and
assign, without recourse (in accordance with and subject to the restrictions
contained in Section 9.04), all of its interests, rights and obligations under
this Agreement to an assignee that shall assume such assigned obligations (which
assignee may be another Lender, if a Lender accepts such assignment); provided
that (x) such assignment shall not conflict with any law, rule or regulation or
order of any court or other Governmental Authority having jurisdiction, (y) the
Borrower shall have received the prior written consent of the Administrative
Agent (and, if a Revolving Credit Commitment is being assigned, of the Issuing
Bank and the Swingline Lender), which consent shall not unreasonably be
withheld, and (z) the Borrower or such assignee shall have paid to the affected
Lender or the Issuing Bank in immediately available funds an amount equal to the
sum of the principal of and interest accrued to the date of such payment on the
outstanding Loans or L/C Disbursements of such Lender or the Issuing Bank and
the Swingline Lender, respectively, plus all Fees and other amounts accrued for
the account of such Lender or the Issuing Bank hereunder (including any amounts
under Section 2.14 and Section 2.16); provided further that, if prior to any
such transfer and assignment the circumstances or event that resulted in such
Lender's or the Issuing Bank's claim for compensation under Section 2.14 or
notice under Section 2.15 or the amounts paid pursuant to Section 2.20, as the
case may be, cease to cause such Lender or the Issuing Bank to suffer increased
costs or reductions in amounts received or receivable or reduction in return on
capital, or cease to have the consequences specified in Section 2.15, or cease
to result in amounts being payable under Section 2.20, as the case may be
(including as a result of any action taken by such Lender or the Issuing Bank
pursuant to paragraph (b) below), or if such Lender or the Issuing Bank shall
waive its right to claim further compensation under Section 2.14 in respect of
such circumstances or event or shall withdraw its notice under Section 2.15 or
shall waive its right to further payments under Section 2.20 in respect of such
circumstances
<PAGE>

                                      -45-

or event, as the case may be, then such Lender or the Issuing Bank shall not
thereafter be required to make any such transfer and assignment hereunder.

     (b) If (i) any Lender or the Issuing Bank shall request compensation under
Section 2.14, (ii) any Lender or the Issuing Bank delivers a notice described in
Section 2.15 or (iii) the Borrower is required to pay any additional amount to
any Lender or the Issuing Bank or any Governmental Authority on account of any
Lender or the Issuing Bank, pursuant to Section 2.20, then such Lender or the
Issuing Bank shall use reasonable efforts (which shall not require such Lender
or the Issuing Bank to incur an unreimbursed loss or unreimbursed cost or
expense or otherwise take any action inconsistent with its internal policies or
legal or regulatory restrictions or suffer any disadvantage or burden deemed by
it to be significant) (x) to file any certificate or document reasonably
requested in writing by the Borrower or (y) to assign its rights and delegate
and transfer its obligations hereunder to another of its offices, branches or
affiliates, if such filing or assignment would materially  reduce its claims for
compensation under Section 2.14 or enable it to withdraw its notice pursuant to
Section 2.15 or would materially reduce amounts payable pursuant to Section
2.20, as the case may be, in the future.  The Borrower hereby agrees to pay all
reasonable costs and expenses incurred by any Lender or the Issuing Bank in
connection with any such filing or assignment, delegation and transfer.

     SECTION 2.22.  Swingline Loans.  (a)  Swingline Commitment.  Subject to
the terms and conditions and relying upon the representations and warranties
herein set forth, the Swingline Lender agrees to make loans to the Borrower at
any time and from time to time on and after the Closing Date and until the
earlier of the Revolving Credit Maturity Date and the termination of the
Revolving Credit Commitments in accordance with the terms hereof, in an
aggregate principal amount at any time outstanding that will not result in (i)
the aggregate principal amount of all Swingline Loans exceeding $5,000,000 or
(ii) the Aggregate Revolving Credit Exposure, after giving effect to any
Swingline Loan, exceeding the Total Revolving Credit Commitment.  The initial
Swingline Loan shall be in a principal amount that is no less than $500,000 and
thereafter each subsequent Swingline Loan may be in an integral multiple of
$100,000.  The Swingline Commitment may be terminated or reduced from time to
time as provided herein.  Within the foregoing limits, the Borrower may borrow,
pay or prepay and reborrow Swingline Loans hereunder, subject to the terms,
conditions and limitations set forth herein.

     (b) Swingline Loans. The Borrower shall notify the Administrative Agent by
telecopy, or by telephone (confirmed by telecopy), not later than 12:00 p.m.,
New York City time, on the day of a proposed Swingline Loan.  Such notice shall
be delivered on a Business Day, shall be irrevocable and shall refer to this
Agreement and shall specify the requested date (which shall be a Business Day)
and amount of such Swingline Loan. The Administrative Agent will promptly advise
the Swingline Lender of any notice received from the Borrower pursuant to this
paragraph (b).  The Swingline Lender shall make each Swingline Loan available to
the Borrower by means of a credit to an account as directed by the Borrower in
the notice requesting such Swingline Loan on the date such Swingline Loan is so
requested.

     (c) Prepayment. The Borrower shall have the right at any time and from time
to time to prepay any Swingline Loan, in whole or in part, upon giving written
or telecopy notice (or telephone notice promptly confirmed by written, or
telecopy notice) to the Swingline Lender and to the Administrative Agent before
12:00 (noon), New York City time on the date of prepayment at the Swingline
Lender's address for notices specified in Schedule 2.01. All principal payments
of Swingline Loans shall be accompanied by accrued interest on the principal
amount being repaid to the date of payment, payable on the last Business Day of
the Interest Period applicable to ABR Loans.
<PAGE>

                                      -46-

     (d) Interest. Each Swingline Loan shall be an ABR Loan and, subject to the
provisions of Section 2.07, shall bear interest as provided in Section 2.06(a).

     (e) Participations. The Swingline Lender may by written notice given to the
Administrative Agent not later than 11:00 a.m., New York City time, on any
Business Day require the Revolving Credit Lenders to acquire participations on
such Business Day in all or a portion of the Swingline Loans outstanding.  Such
notice shall specify the aggregate amount of Swingline Loans in which the
Revolving Credit Lenders will participate.  The Administrative Agent will,
promptly upon receipt of such notice, give notice to each Revolving Credit
Lender, specifying in such notice such Lender's Pro Rata Share of such Swingline
Loan or Loans.  In furtherance of the foregoing, each Revolving Credit Lender
hereby absolutely and unconditionally agrees, upon receipt of notice as provided
above, to pay to the Administrative Agent, for the account of the Swingline
Lender, such Revolving Credit Lender's Pro Rata Share of such Swingline Loan or
Loans.  Each Revolving Credit Lender acknowledges and agrees that its obligation
to acquire participations in Swingline Loans pursuant to this paragraph is
absolute and unconditional and shall not be affected by any circumstance
whatsoever, including the occurrence and continuance of a Default or an Event of
Default, and that each such payment shall be made without any offset, abatement,
withholding or reduction whatsoever.  Each Revolving Credit Lender shall comply
with its obligation under this paragraph by wire transfer of immediately
available funds, in the same manner as provided in Section 2.02(c) with respect
to Loans made by such Lender (and Section 2.02(c) shall apply, mutatis mutandis,
to the payment obligations of the Lenders) and the Administrative Agent shall
promptly pay to the Swingline Lender the amounts so received by it from the
Lenders.  The Administrative Agent shall notify the Borrower of any
participations in any Swingline Loan acquired pursuant to this paragraph and
thereafter payments in respect of such Swingline Loan shall be made to the
Administrative Agent and not to the Swingline Lender.  Any amounts received by
the Swingline Lender from the Borrower (or other party on behalf of the
Borrower) in respect of a Swingline Loan after receipt by the Swingline Lender
of the proceeds of a sale of participations therein shall be promptly remitted
to the Administrative Agent; any such amounts received by the Administrative
Agent shall be promptly remitted by the Administrative Agent to the Lenders that
shall have made their payments pursuant to this paragraph and to the Swingline
Lender, as their interests may appear. The purchase of participations in a
Swingline Loan pursuant to this paragraph shall not relieve the Borrower (or
other party liable for obligations of the Borrower) of any default in the
payment thereof.

     SECTION 2.23.  Letters of Credit.  (a)  General.  The Borrower may
request the issuance of a Letter of Credit for its own account, in a form
reasonably acceptable to the Administrative Agent and the Issuing Bank, at any
time and from time to time while the Revolving Credit Commitments remain in
effect.  This Section shall not be construed to impose an obligation upon the
Issuing Bank to issue any Letter of Credit that is inconsistent with the terms
and conditions of this Agreement.

     (b) Notice of Issuance, Amendment, Renewal, Extension; Certain Conditions.
In order to request the issuance of a Letter of Credit (or to amend, renew or
extend an existing Letter of Credit), the Borrower shall hand deliver or
telecopy to the Issuing Bank and the Administrative Agent (reasonably in advance
of the requested date of issuance, amendment, renewal or extension) a notice
requesting the issuance of a Letter of Credit, or identifying the Letter of
Credit to be amended, renewed or extended, the date of issuance, amendment,
renewal or extension, the date on which such Letter of Credit is to expire
(which shall comply with paragraph (c) below), the amount of such Letter of
Credit, the name and address of the beneficiary thereof and such other
information as shall be necessary to prepare such Letter of Credit. A Letter of
Credit shall be issued, amended, renewed or extended only if, and upon issuance,
amendment, renewal or extension of each Letter of Credit the Borrower shall be
deemed to represent and warrant that, after giving effect to such issuance,
amendment, renewal or extension (i) the L/C Exposure shall not exceed
$17,000,000 and (ii) the Aggregate Revolving Credit Exposure shall not exceed
the Total Revolving Credit Commitment.
<PAGE>

                                      -47-

     (c) Expiration Date.  Each Letter of Credit shall expire at the close of
business on the earlier of the date one year after the date of the issuance of
such Letter of Credit and the date that is five Business Days prior to the
Revolving Credit Maturity Date, unless such Letter of Credit expires by its
terms on an earlier date.

     (d) Participations. By the issuance of a Letter of Credit and without any
further action on the part of the Issuing Bank or the Lenders, the Issuing Bank
hereby grants to each Revolving Credit Lender, and each such Lender hereby
acquires from the applicable Issuing Bank, a participation in such Letter of
Credit equal to such Lender's Pro Rata Share of the aggregate amount available
to be drawn under such Letter of Credit, effective upon the issuance of such
Letter of Credit.  In consideration and in furtherance of the foregoing, each
Revolving Credit Lender hereby absolutely and unconditionally agrees to pay to
the Administrative Agent, for the account of the Issuing Bank, such Lender's Pro
Rata Share of each L/C Disbursement made by the Issuing Bank and not reimbursed
by the Borrower (or, if applicable, another party pursuant to its obligations
under any other Loan Document) forthwith on the date due as provided in Section
2.02(e).  Each Revolving Credit Lender acknowledges and agrees that its
obligation to acquire participations pursuant to this paragraph in respect of
Letters of Credit is absolute and unconditional and shall not be affected by any
circumstance whatsoever, including the occurrence and continuance of a Default
or an Event of Default, and that each such payment shall be made without any
offset, abatement, withholding or reduction whatsoever.

     (e) Reimbursement. If the Issuing Bank shall make any L/C Disbursement in
respect of a Letter of Credit, the Borrower shall pay to the Administrative
Agent an amount equal to such L/C Disbursement not later than the end of the day
on which the Borrower shall have received notice from the Issuing Bank that
payment of such draft will be made, or, if the Borrower shall have received such
notice later than 10:00 a.m., New York City time, on any Business Day, not later
than 10:00 a.m., New York City time, on the immediately following Business Day.

     (f) Obligations Absolute. The Borrower's obligations to reimburse L/C
Disbursements as provided in paragraph (e) above shall be absolute,
unconditional and irrevocable, and shall be performed strictly in accordance
with the terms of this Agreement, under any and all circumstances whatsoever,
and irrespective of:

            (i)    any lack of validity or enforceability of any Letter of
     Credit or any Loan Document, or any term or provision therein;

            (ii)   any amendment or waiver of or any consent to departure from
     all or any of the provisions of any Letter of Credit or any Loan Document;

            (iii)  the existence of any claim, setoff, defense or other right
     that the Borrower, any other party guaranteeing, or otherwise obligated
     with, the Borrower, any Subsidiary or other Affiliate thereof or any other
     person may at any time have against the beneficiary under any Letter of
     Credit, the Issuing Bank, the Administrative Agent or any Lender or any
     other person, whether in connection with this Agreement, any other Loan
     Document or any other related or unrelated agreement or transaction;

            (iv)   any draft or other document presented under a Letter of
     Credit proving to be forged, fraudulent, invalid or insufficient in any
     respect or any statement therein being untrue or inaccurate in any respect;

            (v)    payment by the Issuing Bank under a Letter of Credit against
     presentation of a draft or other document that does not comply with the
     terms of such Letter of Credit; and
<PAGE>

                                      -48-

            (vi) any other act or omission to act or delay of any kind of the
     Issuing Bank, the Lenders, the Administrative Agent or any other person or
     any other event or circumstance whatsoever, whether or not similar to any
     of the foregoing, that might, but for the provisions of this Section,
     constitute a legal or equitable discharge of the Borrower's obligations
     hereunder.

     Without limiting the generality of the foregoing, it is expressly
understood and agreed that the absolute and unconditional obligation of the
Borrower hereunder to reimburse L/C Disbursements will not be excused by the bad
faith, gross negligence or wilful misconduct of the Issuing Bank.  However, the
foregoing shall not be construed to excuse the Issuing Bank from liability to
the Borrower to the extent of any direct damages (as opposed to consequential
damages, claims in respect of which are hereby waived by the Borrower to the
extent permitted by applicable law) suffered by the Borrower that are caused by
the Issuing Bank's bad faith, gross negligence or wilful misconduct in
determining whether drafts and other documents presented under a Letter of
Credit comply with the terms thereof; it is understood that the Issuing Bank may
accept documents that appear on their face to be in order, without
responsibility for further investigation, regardless of any notice or
information to the contrary and, in making any payment under any Letter of
Credit (i) the Issuing Bank's exclusive reliance on the documents presented to
it under such Letter of Credit as to any and all matters set forth therein,
including reliance on the amount of any draft presented under such Letter of
Credit, whether or not the amount due to the beneficiary thereunder equals the
amount of such draft and whether or not any document presented pursuant to such
Letter of Credit proves to be insufficient in any respect, if such document on
its face appears to be in order, and whether or not any other statement or any
other document presented pursuant to such Letter of Credit proves to be forged
or invalid or any statement therein proves to be inaccurate or untrue in any
respect whatsoever and (ii) any noncompliance in any immaterial respect of the
documents presented under such Letter of Credit with the terms thereof shall, in
each case, be deemed not to constitute bad faith, wilful misconduct or gross
negligence of the Issuing Bank.

     (g) Disbursement Procedures. The Issuing Bank shall, promptly following its
receipt thereof, examine all documents purporting to represent a demand for
payment under a Letter of Credit.  The Issuing Bank shall as promptly as
possible give telephonic notification, confirmed by telecopy, to the
Administrative Agent and the Borrower of such demand for payment and whether the
Issuing Bank has made or will make an L/C Disbursement thereunder; provided that
any failure to give or delay in giving such notice shall not relieve the
Borrower of its obligation to reimburse the Issuing Bank and the Revolving
Credit Lenders with respect to any such L/C Disbursement.  The Administrative
Agent shall promptly give each Revolving Credit Lender notice thereof.

     (h) Interim Interest. If the Issuing Bank shall make any L/C Disbursement
in respect of a Letter of Credit, then, unless the Borrower shall reimburse such
L/C Disbursement in full on such date, the unpaid amount thereof shall bear
interest for the account of the Issuing Bank, for each day from and including
the date of such L/C Disbursement, to but excluding the earlier of the date of
payment by the Borrower or the date on which interest shall commence to accrue
thereon as provided in Section 2.02(e), at the rate per annum that would apply
to such amount if such amount were an ABR Revolving Loan.

     (i) Resignation or Removal of the Issuing Bank.  The Issuing Bank may
resign at any time by giving 180 days' prior written notice to the
Administrative Agent, the Lenders and the Borrower, and may be removed at any
time by the Borrower by notice to the Issuing Bank, the Administrative Agent and
the Lenders.  Subject to the next succeeding paragraph, upon the acceptance of
any appointment as the Issuing Bank hereunder by a Lender that shall agree to
serve as successor Issuing Bank, such successor shall succeed to and become
vested with all the interests, rights and obligations of the retiring Issuing
Bank and the retiring Issuing Bank shall be discharged from its obligations to
issue additional Letters of Credit hereunder.  At the time such
<PAGE>

                                      -49-

removal or resignation shall become effective, the Borrower shall pay all
accrued and unpaid fees pursuant to Section 2.05(c)(ii). The acceptance of any
appointment as the Issuing Bank hereunder by a successor Lender shall be
evidenced by an agreement entered into by such successor, in a form satisfactory
to the Borrower and the Administrative Agent, and, from and after the effective
date of such agreement, (i) such successor Lender shall have all the rights and
obligations of the previous Issuing Bank under this Agreement and the other Loan
Documents and (ii) references herein and in the other Loan Documents to the term
"Issuing Bank" shall be deemed to refer to such successor or to any previous
Issuing Bank, or to such successor and all previous Issuing Banks, as the
context shall require. After the resignation or removal of the Issuing Bank
hereunder, the retiring Issuing Bank shall remain a party hereto and shall
continue to have all the rights and obligations of an Issuing Bank under this
Agreement and the other Loan Documents with respect to Letters of Credit issued
by it prior to such resignation or removal, but shall not be required to issue
additional Letters of Credit.

     (j) Cash Collateralization. If any Event of Default shall occur and be
continuing, the Borrower shall, on the Business Day it receives notice from the
Administrative Agent or the Required Lenders (or, if the maturity of the Loans
has been accelerated, Revolving Credit Lenders holding participations in
outstanding Letters of Credit representing greater than 50% of the aggregate
undrawn amount of all outstanding Letters of Credit) thereof and of the amount
to be deposited, deposit in an account with the Collateral Agent, for the
benefit of the Revolving Credit Lenders, an amount in cash equal to the L/C
Exposure as of such date.  Such deposit shall be held by the Collateral Agent as
collateral for the payment and performance of the Obligations.  The Collateral
Agent shall have exclusive dominion and control, including the exclusive right
of withdrawal, over such account.  Other than any interest earned on the
investment of such deposits in Cash Equivalents, which investments shall be made
at the option and sole discretion of the Collateral Agent, such deposits shall
not bear interest.  Interest or profits, if any, on such investments shall
accumulate in such account.  Moneys in such account shall (i) automatically be
applied by the Administrative Agent to reimburse the Issuing Bank for L/C
Disbursements for which it has not been reimbursed, (ii) be held for the
satisfaction of the reimbursement obligations of the Borrower for the L/C
Exposure at such time and (iii) if the maturity of the Loans has been
accelerated (but subject to the consent of Revolving Credit Lenders holding
participations in outstanding Letters of Credit representing greater than 50% of
the aggregate undrawn amount of all outstanding Letters of Credit), be applied
to satisfy the Obligations.  If the Borrower is required to provide an amount of
cash collateral hereunder as a result of the occurrence of an Event of Default,
such amount (to the extent not applied as aforesaid) shall be returned to the
Borrower within three Business Days after all Events of Default have been cured
or waived.

     (k) Additional Issuing Banks.  The Borrower may, at any time and from time
to time with the consent of the Administrative Agent (which consent shall not be
unreasonably withheld) and such Lender, designate one or more additional Lenders
to act as an issuing bank under the terms of this Agreement.  Any Lender
designated as an issuing bank pursuant to this paragraph (k) shall be deemed (in
addition to being a Lender) to be the Issuing Bank with respect to Letters of
Credit issued or to be issued by such Lender, and all references herein and in
the other Loan Documents to the term "Issuing Bank" shall, with respect to such
Letters of Credit, be deemed to refer to such Lender in its capacity as Issuing
Bank, as the context shall require.

     SECTION 2.24.  Borrowing Subsidiaries.  The Borrower, may, from time to
time, designate any person which is or becomes a Domestic Subsidiary or Foreign
Subsidiary to be a Subsidiary Borrower pursuant to this Section 2.24 effective
on a date not later than thirty days after written notice to Administrative
Agent accompanied by (a) an Assumption Agreement in the form of Exhibit J
attached hereto executed by such Subsidiary and acknowledged by the Borrower and
each Subsidiary Guarantor, (b) a certificate of good standing (or equivalent
thereof, if any) of such Subsidiary in the jurisdiction of its organization, (c)
certified resolutions of the Board of Directors of such Subsidiary authorizing
the execution and delivery of the Assumption Agreement, and any other documents
required to be delivered by this Section 2.24 or Section 5.11, and (d) such
other information,
<PAGE>

                                      -50-

certificates or legal opinions as Administrative Agent reasonably may request;
provided, the maximum aggregate amount of Loans in respect of which Foreign
Subsidiaries may be Subsidiary Borrowers shall not exceed the Dollar Equivalent
of $30,000,000; provided, further, any such designation pursuant to this Section
2.24 shall in no event be deemed to reduce the obligations in any manner or
respect of any party to the Loan Documents or to release any party to the Loan
Documents.

     SECTION 2.25.  Additional Loan.  (a)  So long as no Default has occurred
and is continuing, at any time prior to the Tranche B Maturity Date, the
Borrower may request an additional commitment of up to an aggregate principal
amount of $50,000,000 (the "Additional Loan Commitment").  No Lender or other
                            --------------------------
Person shall be obligated to provide any Additional Loan Commitment.  The
Administrative Agent shall assist and cooperate with (but shall not be obligated
to provide an Additional Loan Commitment to) the Borrower in connection with
obtaining the Additional Loan Commitments.  All Additional Loan Commitments will
be issued on the same date.

     (b) The Administrative Agent, in consultation with the Borrower, will
attempt to identify Persons to provide the Additional Loan Commitments (it being
understood that all such Persons will be required to satisfy the criteria of a
"Lender" hereunder).  Additional Loan Commitments may, subject to the foregoing,
be made by existing Lenders or new Lenders (each, an "Additional Lender") that
                                                      -----------------
will be required to become a party to this Agreement in connection with the
issuance of an Additional Loan Commitment.  The aggregate amount of all
Additional Loan Commitments shall not exceed $50,000,000.  The existing Lenders
and the Additional Lenders which agree to provide Additional Loan Commitments
are collectively referred to herein as the "Tranche C Term Loan Lenders."
                                            ---------------------------

     (c) The Additional Loan Commitments shall become effective upon the receipt
by the Administrative Agent of an agreement in form and substance satisfactory
to the Administrative Agent signed by the Borrower and by each Additional Loan
Lender, setting forth the Additional Loan Commitments of such Tranche C Term
Loan Lenders, the maturity, amortization and interest rates applicable to the
Additional Loans and the agreement of each Additional Lender to become a party
to this Agreement and to be bound by all the terms and provisions hereof,
together with such evidence of appropriate corporate authorization on the part
of the Borrower with respect to the Additional Loan Commitments and such
opinions of counsel for the Borrower with respect to the Additional Loan
Commitments and such agreements as the Administrative Agent may reasonably
request.  So long as no Default is in existence or would result therefrom, the
Borrower may borrow once in a single draw under the Additional Loan Commitments
by following the procedures with respect to Credit Events set forth herein (each
such loan made by an Additional Loan Lender, a "Tranche C Term Loan").  The
                                                -------------------
Tranche C Term Loans shall have a final maturity no earlier than the Tranche B
Term Loans (any such date, the "Tranche C Maturity Date") and none of the terms
                                -----------------------
of the Tranche C Term Loans shall be more favorable to the Lenders thereof than
the terms applicable to the Tranche B Term Loans.

                                  ARTICLE III

                         Representations and Warranties

     The Borrower represents and warrants to the Administrative Agent, the
Collateral Agent, the Issuing Bank and each of the Lenders that:
<PAGE>

                                      -51-

     SECTION 3.01.  Organization; Powers.  The Borrower and each of the
Subsidiaries (a) is duly organized, validly existing and in good standing or
active status under the laws of the jurisdiction of its organization (except
Baraboo Equipment Corporation, an inactive Subsidiary, is not in active status
in the State of Wisconsin), (b) has all requisite power and authority to own its
Property and to carry on its business as now conducted and as proposed to be
conducted, (c) is qualified to do business in, and is in good standing in, every
jurisdiction where such qualification is required, except where the failure so
to qualify could not reasonably be expected to result in a Material Adverse
Effect, and (d) has the power and authority to execute, deliver and perform its
obligations under each of the Loan Documents and each other agreement or
instrument contemplated hereby to which it is or will be a party and, in the
case of the Borrower, to borrow hereunder.

     SECTION 3.02.  Authorization.  The execution, delivery and performance by
each Loan Party of each of the Loan Documents and the consummation by the Loan
Parties of the Transactions (including the borrowings hereunder) (a) have been
duly authorized by all requisite corporate and, if required, stockholder action
and (b) will not (i) violate (A) any provision of law, statute, rule or
regulation, or of the certificate or articles of incorporation or other
constitutive documents or by-laws of the Borrower or any Subsidiary, (B) any
order of any Governmental Authority or (C) any provision of any indenture,
agreement or other instrument to which the Borrower or any Subsidiary is a party
or by which any of them or any of their Property is or may be bound, (ii) be in
conflict with, result in a breach of or constitute (alone or with notice or
lapse of time or both) a default under, or give rise to any right to accelerate
or to require the prepayment, repurchase or redemption of any obligation under
any such indenture, agreement or other instrument or (iii) result in the
creation or imposition of any Lien upon or with respect to any Property now
owned or hereafter acquired by the Borrower or any Subsidiary (other than any
Lien created hereunder or under the Security Documents).

     SECTION 3.03.  Enforceability.  This Agreement has been duly executed and
delivered by the Borrower and constitutes, and each other Loan Document when
executed and delivered by the each Loan Party thereto will constitute, a legal,
valid and binding obligation of such Loan Party enforceable against such Loan
Party in accordance with its terms.

     SECTION 3.04.  Governmental Approvals.  No action, consent or approval
of, registration or filing with or any other action by any Governmental
Authority is or will be required in connection with the Transactions, except for
(a) the filing of UCC financing statements, (b) recordation of the Mortgages,
(c) such as have been made or obtained and are in full force and effect and (d)
those filings required to be made following the Closing Date which are set forth
on Schedule 3.04.

     SECTION 3.05.  Financial Statements.  (a)  The Borrower has heretofore
furnished to the Lenders its consolidated balance sheets and related statements
of income, stockholder's equity and cash flows (x) as of and for the fiscal year
ended August 31, 1999, audited by and accompanied by the opinion of
PricewaterhouseCoopers LLP, independent public accountants, and (y) as of and
for the fiscal quarter ended May 31, 2000, certified by its chief financial
officer.  Such financial statements present fairly the financial condition and
results of operations and cash flows of the Borrower and the Subsidiaries as of
such dates and for such periods.  Such balance sheets and the notes thereto
disclose all material liabilities, direct or contingent, of the Borrower and the
Subsidiaries as of the dates thereof.  Such financial statements were prepared
in accordance with GAAP applied on a consistent basis.

     (b) The Borrower has heretofore delivered to the Lenders its unaudited pro
forma consolidated balance sheet and related statement of income as of February
29, 2000, prepared giving effect to the Transactions as if they had occurred,
with respect to such balance sheet, on such date, and with respect to such
income statement, on September 1, 1999.  Such pro forma financial statements
have been prepared in good faith by the
<PAGE>

                                      -52-

Borrower, based on the assumptions used to prepare the pro forma financial
information contained in the Confidential Information Memorandum (which
assumptions are believed by the Borrower on the date hereof and on the Closing
Date to be reasonable), are based on the best information available to the
Borrower as of the date of delivery thereof, accurately reflect all adjustments
required to be made to give effect to the Transactions and present fairly on a
pro forma basis the estimated consolidated financial position of the Borrower
and its consolidated Subsidiaries as of such dates, assuming that the
Transactions had actually occurred at such dates.

     (c) The Borrower has heretofore delivered to the Lenders, projections for
each fiscal year beginning with the fiscal year ending August 31, 2000 and
through and including the fiscal year ending August 31, 2008.  Such projections
have been prepared in good faith by the Borrower, based on the best information
available to the Borrower as of the date of delivery thereof, accurately reflect
all adjustments required to be made to give effect to the Transactions.

     SECTION 3.06.  No Material Adverse Change.  There has been no material
adverse change in the business, results of operations, prospects, condition,
financial or otherwise, or material agreements of the Borrower and the
Subsidiaries, taken as a whole, since August 31, 1999.

     SECTION 3.07.  Title to Properties; Possession Under Leases.  (a)
Schedule 3.07(a)(i) contains a true and complete list of each parcel of Real
Property owned by the Borrower and/or any Subsidiary as of the date hereof and
describes the interest therein held by the Borrower and/or the Subsidiary.
Schedule 3.07(a)(ii) contains a true and complete list of each parcel of Real
Property leased, subleased or otherwise occupied or utilized by the Borrower
and/or any Subsidiary as of the date hereof and describes the interest therein
held by Borrower and/or the Subsidiary.  Each of the Borrower and the
Subsidiaries has in the case of the Real Properties set forth in Schedule
3.07(a)(i) good, indefeasible and marketable title to, or in the case of the
Real Properties set forth in Schedule 3.07(a)(ii) valid, substituting,
marketable and insurable leasehold interests in, all its Real Property, free and
clear of all Liens, other than Prior Liens expressly permitted by the applicable
Mortgage.

     (b) Each lease or sublease of Real Property is valid and in full force and
effect and neither the Borrower nor any Subsidiary is in default under any such
lease or sublease and, to the knowledge of the Borrower or any Subsidiary, the
other party or parties thereto are not in any material respect in default of its
or their obligations thereunder, except that the tenant under the lease for 3757
Falls Mill Road, Mobile, Alabama has vacated the premises.  The Borrower and/or
a Subsidiary is in possession of all the Real Property except with respect to
portions thereof subleased to third parties in the ordinary course of business
and in accordance with the provisions of the applicable Security Document,
except that the tenant under the lease for 3757 Falls Mill Road, Mobile, Alabama
has vacated the premises.

     (c) Title to all Property (other than Real Property) is held by the
Borrower and/or a Subsidiary free and clear of all Liens except for Prior Liens
and other Liens expressly permitted to exist on such type of Property pursuant
to the terms of the applicable Security Document.

     (d) The Property of the Borrower and the Subsidiaries, taken as a whole, is
in good operating order, condition and repair (ordinary wear and tear excepted)
and constitutes all the assets and properties which are required for the
business and operations of the Borrower and the Subsidiaries as presently
conducted.

     (e) Except as set forth on Schedule 3.07(e), the Borrower, or any
Subsidiary, has not received any notice of, nor has any knowledge of, any
pending or contemplated condemnation proceeding affecting all or any portion of
the Property or any sale or disposition thereof in lieu of condemnation.
<PAGE>

                                      -53-

     (f) None of the Borrower or any of the Subsidiaries is obligated under any
right of first refusal, option or other contractual right to sell, assign or
otherwise dispose of any Property or any interest therein.

     SECTION 3.08.  Subsidiaries.  Schedule 3.08 sets forth as of the date
hereof a list of all Subsidiaries and the percentage Equity Interest of the Loan
Parties therein.  The Equity Interests so indicated on Schedule 3.08 are fully
paid and non-assessable and are owned by the Borrower or the applicable
Subsidiary Guarantor, directly or indirectly, free and clear of all Liens other
than Liens created by the Security Agreement.  The Subsidiary Guarantors listed
on Schedule 1.01(b) constitute all of the Domestic Subsidiaries with annual
sales or assets in excess of $5,000,000 as of the Closing Date.

     SECTION 3.09.  Litigation; Compliance with Laws.  (a)  Except as set
forth on Schedule 3.09 or Schedule 3.17, there are not any actions, suits or
proceedings at law or in equity or by or before any Governmental Authority now
pending or, to the knowledge of the Borrower, threatened against or affecting
the Borrower or any Subsidiary or any business, Property or rights of any such
person (i) that involve any Loan Document or the Transactions or (ii) as to
which there is a reasonable possibility of an adverse determination and that, if
adversely determined, could reasonably be expected, individually or in the
aggregate, to result in a Material Adverse Effect.

     (b) Except for matters covered by Section 3.17, none of the Borrower or any
of the Subsidiaries or any of their respective Property is in violation of, nor
will the continued operation of their property as currently conducted violate,
any Requirements of Law (including any zoning or building ordinance, code or
approval or any building permits) or any restrictions of record or agreements
affecting the Property, or is in default with respect to any judgment, writ,
injunction, decree or order of any Governmental Authority, where such violation
or default could reasonably be expected to result in a Material Adverse Effect.

     SECTION 3.10.  Agreements.  (a)  None of the Borrower or any of the
Subsidiaries is a party to any agreement or instrument or subject to any
corporate restriction that has resulted or could reasonably be expected to
result in a Material Adverse Effect.

     (b) None of the Borrower or any of the Subsidiaries is in default in any
manner under any provision of any indenture or other agreement or instrument
evidencing Indebtedness, or any other agreement or instrument to which it is a
party or by which it or any of its Properties are or may be bound, where such
default could reasonably be expected to result in a Material Adverse Effect.

     (c) Schedule 3.10 accurately and completely lists all material agreements
(other than leases of Real Property otherwise set forth on Schedule 3.07(a)(ii))
to which the Borrower and any Subsidiary are a party which are in effect on the
Closing Date in connection with the operation of the business conducted thereby.

     SECTION 3.11.  Federal Reserve Regulations.  (a)  None of the Borrower or
any of the Subsidiaries is engaged principally, or as one of its important
activities, in the business of extending credit for the purpose of buying or
carrying Margin Stock.

     (b) No part of the proceeds of any Loan or any Letter of Credit will be
used, whether directly or indirectly, and whether immediately, incidentally or
ultimately, for any purpose that entails a violation of, or that is inconsistent
with, the provisions of the Regulations of the Board, including Regulation T, U
or X.

     SECTION 3.12.  Investment Company Act; Public Utility Holding Company Act.
None of the Borrower or any Subsidiary is (a) an "investment company" as
defined in, or subject to regulation under, the In-
<PAGE>

                                      -54-

vestment Company Act of 1940 or (b) a "holding company" as defined in, or
subject to regulation under, the Public Utility Holding Company Act of 1935.

     SECTION 3.13.  Use of Proceeds.  The Borrower will use the proceeds of
the Loans and will request the issuance of Letters of Credit only for the
purposes specified in the preamble to this Agreement.

     SECTION 3.14.  Tax Returns.  Each of the Borrower and the Subsidiaries
has filed or caused to be filed all Federal tax returns and all material, state,
local and foreign tax returns or materials required to have been filed by it and
has paid or caused to be paid all taxes due and payable by it and all
assessments received by it, except taxes that are being contested in good faith
by appropriate proceedings and for which the Borrower or such Subsidiary, as
applicable, shall have set aside on its books adequate reserves and except with
respect to any taxes for which the Borrower has provided indemnification to APW,
Ltd. as set forth on Schedule 3.14.

     SECTION 3.15.  No Material Misstatements.  None of (a) the Confidential
Information Memorandum or (b) any other information, report, financial
statement, exhibit or schedule furnished by or on behalf of the Borrower to the
Administrative Agent or any Lender in connection with the negotiation of any
Loan Document or included therein or delivered pursuant thereto contained,
contains or will contain any material misstatement of fact or omitted, omits or
will omit to state any material fact necessary to make the statements therein,
in the light of the circumstances under which they were, are or will be made,
not misleading as of the date such information is dated or certified; provided
that to the extent any such information, report, financial statement, exhibit or
schedule was based upon or constitutes a forecast or projection, the Borrower
represents only that it acted in good faith and utilized reasonable assumptions
and due care in the preparation of such information, report, financial
statement, exhibit or schedule.

     SECTION 3.16.  Employee Benefit Plans.  (a)  Each of the Borrower and its
ERISA Affiliates is in compliance in all material respects with the applicable
provisions of ERISA and the Code and the regulations and published
interpretations thereunder.  No ERISA Event has occurred or is reasonably
expected to occur that, when taken together with all other such ERISA Events,
could reasonably be expected to result in material liability of the Borrower or
any of its ERISA Affiliates.  The present value of all benefit liabilities under
each Plan (based on those assumptions used to fund such Plan) did not, as of the
last annual valuation date applicable thereto, exceed by more than $200,000 the
fair market value of the assets of such Plan, and the present value of all
benefit liabilities of all underfunded Plans (based on those assumptions used to
fund each such Plan) did not, as of the last annual valuation dates applicable
thereto, exceed by more than $200,000 the fair market value of the assets of all
such underfunded Plans.

     (b) Each Foreign Pension Plan is in compliance in all material respects
with all requirements of law applicable thereto and the respective requirements
of the governing documents for such plan except to the extent such non-
compliance could not reasonably be expected to result in a Material Adverse
Effect.  With respect to each Foreign Pension Plan, none of the Borrower, its
Affiliates or any of its directors, officers, employees or agents has engaged in
a transaction that subject the Borrower or any of the Subsidiaries, directly or
indirectly, to a material tax or civil penalty.  With respect to each Foreign
Pension Plan, reserves have been established in the financial statements
furnished to Lenders in respect of any unfunded liabilities in accordance with
applicable law and prudent business practice or, where required, in accordance
with ordinary accounting practices in the jurisdiction in which such Foreign
Pension Plan is maintained.  The aggregate unfunded liabilities, with respect to
such Foreign Pension Plans could not reasonably be expected to result in a
Material Adverse Effect.  There are no actions, suits or claims (other than
routine claims for benefits) pending or threatened against the Borrower or any
of its Affiliates with respect to any Foreign Pension Plan which could
reasonably be expected, individually or in the aggregate, to result in a
Material Adverse Effect.
<PAGE>

                                      -55-

     SECTION 3.17.  Environmental Matters.  Except as set forth in Schedule
3.17:

          (a) The properties owned or operated by the Borrower and the
     Subsidiaries (the "Real Properties") do not contain any Hazardous Materials
     in amounts or concentrations which (i) constitute, or constituted a
     violation of, (ii) require Remedial Action under, or (iii) could give rise
     to liability under, Environmental Laws, which violations, Remedial Actions
     and liabilities, in the aggregate, could reasonably be expected to result
     in a Material Adverse Effect;

          (b) The Real Properties and all operations of the Borrower and the
     Subsidiaries are in compliance, and in the last six years have been in
     compliance, with all Environmental Laws and all necessary Environmental
     Permits have been obtained and are in effect, except to the extent that
     such non-compliance or failure to obtain any necessary permits, in the
     aggregate, could not reasonably be expected to result in a Material Adverse
     Effect;

          (c) There have been no Releases or threatened Releases by the Borrower
     or any Subsidiary or, to their knowledge, by any other party, at, from,
     under or proximate to the Real Properties or otherwise in connection with
     the operations of the Borrower or the Subsidiaries, which Releases or
     threatened Releases, in the aggregate, could  reasonably be expected to
     result in a Material Adverse Effect;

          (d) None of the Borrower or any of the Subsidiaries has received any
     notice of an Environmental Claim in connection with the Real Properties or
     the operations of the Borrower or the Subsidiaries or with regard to any
     person whose liabilities for environmental matters the Borrower or the
     Subsidiaries has retained or assumed, in whole or in part, contractually,
     by operation of law or otherwise, which, in the aggregate, could reasonably
     be expected to result in a Material Adverse Effect; and

          (e) Hazardous Materials have not been transported from the Real
     Properties by or on behalf of the Borrower or any Subsidiary, nor have
     Hazardous Materials been generated, treated, stored or disposed of at, on
     or under any of the Real Properties in a manner that could give rise to
     liability under any Environmental Law, nor have the Borrower or the
     Subsidiaries retained or assumed any liability, contractually or by
     operation of law, with respect to the generation, treatment, storage or
     disposal of Hazardous Materials, which transportation, generation,
     treatment, storage or disposal, or retained or assumed liabilities, in the
     aggregate, could reasonably be expected to result in a Material Adverse
     Effect.

     SECTION 3.18.  Insurance.  Schedule 3.18 sets forth a true, complete and
correct description of all material insurance maintained by the Borrower or by
the Borrower for its Subsidiaries as of the Closing Date.  As of such date, such
insurance is in full force and effect and all premiums have been duly paid.  The
Borrower and its Subsidiaries have insurance in such amounts and covering such
risks and liabilities as are in accordance with normal industry practice.

     SECTION 3.19.  Security Documents.  (a)  The Security Agreement is
effective to create in favor of the Collateral Agent, for the benefit of the
Secured Parties, a legal, valid and enforceable security interest in the Pledged
Collateral and, when (i) financing statements in appropriate form are filed in
the offices specified on Schedule 3.3 to the Security Agreement and (ii) the
Securities Collateral (as defined in the Security Agreement) is delivered to the
Collateral Agent, the Security Agreement shall constitute a fully perfected Lien
on, and security interest in, all right, title and interest of the grantors
thereunder in such Pledged Collateral (other than the Intellectual Property, as
defined in the Security Agreement), in each case prior and superior in right to
any other
<PAGE>

                                      -56-

person, other than holders of Prior Liens and subject to no other Liens except
for Liens expressly permitted to exist on such Pledged Collateral by the terms
of the Security Agreement.

     (b) When the Security Agreement is filed in the United States Patent and
Trademark Office and the United States Copyright Office, the Security Agreement
shall constitute a fully perfected Lien on, and security interest in, all right,
title and interest of the grantors thereunder in the Intellectual Property
Collateral (as defined in the Security Agreement), in each case prior and
superior in right to any other person (it being understood that subsequent
recordings in the United States Patent and Trademark Office and the United
States Copyright Office may be necessary to perfect a lien on registered
trademarks, trademark applications and copyrights acquired by the grantors after
the date hereof), other than holders of Prior Liens and subject to no other
Liens except for Liens expressly permitted to exist on such Pledged Collateral
by the terms of the Security Agreement.

     (c) The Mortgages are effective to create in favor of the Collateral Agent,
for the benefit of the Secured Parties, a legal, valid and enforceable Lien on,
and security interest in, all of the Loan Parties' right, title and interest in
and to the Mortgaged Property thereunder, and when the Mortgages are filed in
the offices specified on Schedule 3.19(c), the Mortgages shall constitute a
fully perfected Lien on, and security interest in, all right, title and interest
of the Loan Parties in such Mortgaged Property, in each case prior and superior
in right to any other person, other than holders of Prior Liens and subject to
no other Lien except for Liens expressly permitted to exist on such Mortgaged
Property by the terms of the applicable Mortgage.

     SECTION 3.20.  Labor Matters.    As of the date hereof and the Closing
Date, there are no strikes, lockouts or slowdowns against the Borrower or any
Subsidiary pending or, to the knowledge of the Borrower, threatened.  The hours
worked by and payments made to employees the Borrower and the Subsidiaries have
not been in violation of the Fair Labor Standards Act or any other applicable
Federal, state, local or foreign law dealing with such matters in any manner
which could reasonably be expected to have a Material Adverse Effect.  All
payments due from the Borrower or any Subsidiary, or for which any claim may be
made against the Borrower or any Subsidiary, on account of wages and employee
health and welfare insurance and other benefits, have been paid or accrued as a
liability on the books of the Borrower or such Subsidiary except where the
failure to do so could not reasonably be expected to have a Material Adverse
Effect.  The consummation of the Transactions will not give rise to any right of
termination or right of renegotiation on the part of any union under any
collective bargaining agreement to which the Borrower or any Subsidiary is
bound.

     SECTION 3.21.  Solvency.  Immediately after the consummation of the
Transactions to occur on the Closing Date and immediately following the making
of each Loan and after giving effect to the application of the proceeds of each
Loan, (a) the fair value of the assets of the Loan Parties taken as a whole, at
a fair valuation, will exceed their debts and liabilities, subordinated,
contingent or otherwise; (b) the present fair saleable value of the property of
the Loan Parties taken as a whole will be greater than the amount that will be
required to pay the probable liability of their debts and other liabilities,
subordinated, contingent or otherwise, as such debts and other liabilities
become absolute and matured; (c) the Loan Parties taken as a whole will be able
to pay their debts and liabilities, subordinated, contingent or otherwise, as
such debts and liabilities become absolute and matured; and (d) the Loan Parties
taken as a whole will not have unreasonably small capital with which to conduct
the businesses in which they are engaged as such businesses are now conducted
and are proposed to be conducted following the Closing Date.

     SECTION 3.22.  Representations and Warranties in Documents.  All
representations and warranties set forth in the other Loan Documents and the
Transaction Documents were true and correct in all material respects at the time
as of which such representations and warranties were made (or deemed made),
provided that to the extent the representations and warranties in the
Transaction Documents are made by persons other than the Loan
<PAGE>

                                      -57-

Parties, then the representations and warranties so made by such persons shall
be deemed to be true and correct in all material respects for purposes of this
Section 3.22 unless the aggregate effect of all misrepresentations made by such
other persons in the Transaction Documents are such as would evidence a material
adverse change in the operations, properties, condition (financial or otherwise)
or prospects of the Borrower from that which would have applied if all
representations made by such other persons in the Transaction Documents had been
true and correct in all respects.

     SECTION 3.23.  Letters of Credit.  The Existing L/C and the trade letters
of credit referred to on Schedule 6.01 are the only letters of credit issued for
the account of the Borrower or any of the Subsidiaries which are outstanding
immediately prior to the Closing Date and will remain outstanding after the
Closing Date.

     SECTION 3.24.  Contingent Obligations. All contingent obligations incurred
in connection with the Spin-Off are in such amounts as are set forth on Schedule
6.01.

                                   ARTICLE IV

                             Conditions of Lending

     The obligations of the Lenders to make Loans and of the Issuing Bank to
issue Letters of Credit hereunder are subject to the satisfaction of the
following conditions:

     SECTION 4.01.  All Credit Events. On the date of each Borrowing, including
each Borrowing of a Swingline Loan, and on the date of each issuance, amendment,
extension or renewal of a Letter of Credit (each such event being called a
"Credit Event"):

          (a) The Administrative Agent shall have received a notice of such
     Borrowing as required by Section 2.03 (or such notice shall have been
     deemed given in accordance with Section 2.03) or, in the case of the
     issuance, amendment, extension or renewal of a Letter of Credit, the
     Issuing Bank and the Administrative Agent shall have received a notice
     requesting the issuance, amendment, extension or renewal of such Letter of
     Credit as required by Section 2.23(b) or, in the case of the Borrowing of a
     Swingline Loan, the Swingline Lender and the Administrative Agent shall
     have received a notice requesting such Swingline Loan as required by
     Section 2.22(b).

          (b) The representations and warranties set forth in Article III hereof
     or in any other Loan Document shall be true and correct in all material
     respects on and as of the date of such Credit Event with the same effect as
     though made on and as of such date, except to the extent such
     representations and warranties expressly relate to an earlier date.

          (c) The Borrower and each other Loan Party shall be in compliance in
     all material respects with all the terms and provisions set forth herein
     and in each other Loan Document on its part to be observed or performed,
     and at the time of and immediately after such Credit Event, no Event of
     Default or Default shall have occurred and be continuing.

          (d) There shall not have occurred or become known to the
     Administrative Agent any event or events, adverse condition or change in or
     affecting the Loan Parties, or any of them, that individually or in the
     aggregate could reasonably be expected to have a Material Adverse Effect.
<PAGE>

                                      -58-

     Each Credit Event shall be deemed to constitute a representation and
warranty by the Borrower on the date of such Credit Event as to the matters
specified in paragraphs (b), (c) and (d) (other than with respect to the
knowledge of the Administrative Agent) of this Section 4.01.

     SECTION 4.02.  First Credit Event. On the Closing Date:

          (a) The Administrative Agent shall have received, on behalf of itself,
     the Lenders and the Issuing Bank, a favorable written opinion of (i)
     Quarles & Brady, special counsel for the Borrower, substantially to the
     effect set forth in Exhibit H, and (ii) each local counsel listed on
     Schedule 4.02(a), substantially to the effect set forth in Exhibit I, in
     each case (A) dated the Closing Date, (B) addressed to the Issuing Bank,
     the Administrative Agent, the Collateral Agent and the Lenders, and (C)
     covering such other matters relating to the Loan Documents and the
     Transactions as the Administrative Agent or the Collateral Agent shall
     reasonably request, and the Borrower hereby requests such counsel to
     deliver such opinions.

          (b) All legal matters incident to this Agreement, the Borrowings and
     extensions of credit hereunder and the other Loan Documents shall be
     reasonably satisfactory to the Lenders, to the Issuing Bank and to the
     Administrative Agent.

          (c) The Administrative Agent shall have received (i) a copy of the
     certificate or articles of incorporation, including all amendments thereto,
     of each Loan Party, certified as of a recent date by the Secretary of State
     of the state of its organization, and a certificate as to the good standing
     of each Loan Party as of a recent date, from such Secretary of State; (ii)
     a certificate of the Secretary or Assistant Secretary of each Loan Party
     dated the Closing Date and certifying (A) that attached thereto is a true
     and complete copy of the by-laws of such Loan Party as in effect on the
     Closing Date and at all times since a date prior to the date of the
     resolutions described in clause (B) below, (B) that attached thereto is a
     true and complete copy of resolutions duly adopted by the Board of
     Directors of such Loan Party authorizing the execution, delivery and
     performance of the Loan Documents to which such person is a party and, in
     the case of the Borrower, the borrowings hereunder, and that such
     resolutions have not been modified, rescinded or amended and are in full
     force and effect, (C) that the certificate or articles of incorporation of
     such Loan Party have not been amended since the date of the last amendment
     thereto shown on the certificate of good standing furnished pursuant to
     clause (i) above, and (D) as to the incumbency and specimen signature of
     each officer executing any Loan Document or any other document delivered in
     connection herewith on behalf of such Loan Party; (iii) a certificate of
     another officer as to the incumbency and specimen signature of the
     Secretary or Assistant Secretary executing the certificate pursuant to (ii)
     above; and (iv) such other documents as the Lenders, the Issuing Bank or
     the Administrative Agent may reasonably request.

          (d) The Administrative Agent shall have received a certificate, dated
     the Closing Date and signed by a Financial Officer of the Borrower,
     confirming compliance with the conditions precedent set forth in paragraphs
     (b), (c) and (d) (other than with respect to the knowledge of the
     Administrative Agent) of Section 4.01.

          (e) The Administrative Agent shall have received all Fees and other
     amounts due and payable on or prior to the Closing Date, including, to the
     extent invoiced, reimbursement or payment of all out-of-pocket expenses
     required to be reimbursed or paid by the Borrower hereunder or under any
     other Loan Document.
<PAGE>

                                      -59-

          (f) The Security Agreement shall have been duly executed by the Loan
     Parties party thereto and shall have been delivered to the Collateral Agent
     and shall be in full force and effect on such date and all certificates,
     agreements or instruments representing or evidencing the Securities
     Collateral (as defined in the Security Agreement), accompanied by
     instruments of transfer and stock powers endorsed in blank, shall have been
     delivered to the Collateral Agent; provided that to the extent to do so
     would cause adverse tax consequences to the Borrower, (i) neither the
     Borrower nor any Domestic Subsidiary shall be required to pledge more than
     65% of the voting stock of any Foreign Subsidiary and (ii) no Foreign
     Subsidiary shall be required to pledge the capital stock of any of its
     Foreign Subsidiaries.

          (g) The Collateral Agent shall have received Mortgages with respect to
     each Mortgaged Property and such Mortgages shall be in full force and
     effect on such date, together with each document required by law or
     reasonably requested by the Collateral Agent to be filed, registered or
     recorded or delivered to the Collateral Agent in order to create in favor
     of the Collateral Agent for the benefit of the Secured Parties a valid,
     legal and perfected first-priority security interest in and Lien on the
     Mortgaged Property; provided, however, that if the underlying lease
                         --------  -------
     relating to any leasehold Mortgaged Property by its terms or by operation
     of law cannot be mortgaged, pledged or assigned as contemplated herein
     without the consent of the lessor thereunder, the Borrower shall use its
     commercially reasonable efforts to obtain such consent as soon as
     practicable but in no event later than 60 days from the date hereof;
     provided, however, that if, notwithstanding the use of its commercially
     --------  -------
     reasonable efforts, the Borrower and/or the applicable Domestic Subsidiary
     shall fail to obtain such consent such failure shall not result in a
     Default hereunder.

          (h) The Borrower and each Subsidiary shall have authorized, executed
     and/or delivered or caused to be delivered each of the following to the
     Collateral Agent:

                 (1) UCC Financing Statements (Form UCC-1 or UCC-2, as
          appropriate) in appropriate form for filing under the UCC and any
          other applicable Requirements of Law in each jurisdiction as may be
          necessary or appropriate to perfect the Liens created, or purported to
          be created, by the Security Documents;

                 (2) certified copies of Requests for Information (Form UCC-11),
          tax lien, judgment lien and pending lawsuit searches or equivalent
          reports or lien search reports, each of a recent date listing all
          effective financing statements, lien notices or comparable documents
          that name the Borrower or any Subsidiary as debtor and that are filed
          in those state and county jurisdictions in which any of the Property
          of the Borrower or any Subsidiary is located and the state and county
          jurisdictions in which the Borrower's or any Subsidiary's principal
          place of business is located, none of which encumber the Collateral
          covered or intended to be covered by the Security Documents other than
          those encumbrances which constitute Prior Liens;

                 (3) with respect to each Real Property, copies of all leases,
          subleases, franchise agreements, licenses, occupancy agreements or
          concession agreements in which a Loan Party holds the landlord's
          interest or other agreements relating to possessory interests.  To the
          extent any of the foregoing affect any Mortgaged Property, such
          agreement shall be subordinate to the Lien of the Mortgage to be
          recorded against such Real Property (either expressly by its terms or
          pursuant to a subordination, non-disturbance and attornment agreement
          acceptable to Collateral Agent) and shall otherwise be reasonably
          acceptable to the Collateral Agent;
<PAGE>

                                      -60-

                 (4) evidence of the completion of all recordings and filings
          of, or with respect to, the Security Agreement, including filings with
          the United States Patent, Trademark and Copyright offices, and
          delivery of such other security and other documents including, without
          limitation, financial account consent letters and consents of
          counterparties to contracts and leases, and the taking of all actions
          as may be necessary or, in the reasonable opinion of the Collateral
          Agent, desirable, to perfect the Liens created, or purported to be
          created, by the Security Agreement, except for any of the foregoing to
          be provided after the Closing Date pursuant to Section 5.11 hereof;

                 (5) with respect to each Real Property, the appropriate Loan
          Party shall have made all notifications, registrations and filings, to
          the extent required by, and in accordance with, all Governmental Real
          Property Disclosure Requirements as applicable to such Real Property,
          including the use of forms provided by state, local or foreign
          agencies, where such forms exist;

                 (6) with respect to each leased Real Property identified on
          Schedule 3.07(a)(ii) attached hereto, to the extent available, a
          --------------------
          landlord lien waiver, consent (if applicable) and access agreement,
          substantially in the form of Exhibit L attached hereto;
                                       ---------

                 (7) subject to Section 4.02(g), with respect to each Mortgaged
          Property, such consents, approvals, amendments, supplements,
          estoppels, tenant subordination agreements or other instruments as
          necessary or required to consummate the transactions contemplated
          hereby or as shall be reasonably deemed necessary by the Collateral
          Agent in order for the owner or holder of the fee or leasehold
          interest constituting such Mortgaged Property to grant the Lien
          contemplated by the Mortgage with respect to such Mortgaged Property;

                 (8) with respect to each Mortgage, a policy (or commitment to
          issue a policy) of title insurance issued by a Title Company insuring
          (or committing to insure) the Lien of such Mortgage as a valid first
          mortgage Lien on the Mortgaged Property and fixtures described therein
          in an amount not less than 100% of the fair market value thereof,
          which policy (or commitment) shall (w) be issued by the Title Company,
          (x) contain a "tie-in" or "cluster" endorsement (if available under
          applicable law) (i.e., policies which insure against losses regardless
                           ---
          of location or allocated value of the insured property up to a stated
          maximum coverage amount) and (y) have been supplemented by such
          endorsements, provided that such endorsements are available at
          commercially reasonable rates as shall be requested by the Collateral
          Agent (including, without limitation, endorsements on matters relating
          to usury, first loss, last dollar, zoning, contiguity (but only with
          respect to such Mortgaged Real Property where there are existing
          Surveys), revolving credit, doing business, public road access, survey
          (but only with respect to such Mortgaged Real Property where there are
          existing Surveys), variable rate and so-called comprehensive coverage
          over covenants and restrictions) and (d) contain no exceptions to
          title other than exceptions for the Prior Liens permitted by the
          applicable Mortgage or that are satisfactory to the Collateral Agent;
          provided, however, that with respect to each policy (or commitment)
          --------  -------
          relating to leasehold Mortgaged Real Property, such endorsements shall
          be limited to matters relating to first loss, last dollar, variable
          rate and the so-called comprehensive coverage.

                 (9) with respect to each Mortgaged Property, a Survey, if
          required by the Title Company, sufficient to cause the Title Company
          to remove the survey and unrecorded ease-
<PAGE>

                                      -61-

          ment exceptions from the title insurance policy (or commitment) with
          respect to such Mortgaged Property;

                 (10) with respect to each Mortgaged Property, policies or
          certificates of insurance as required by the Mortgage relating
          thereto, which policies or certificates shall comply with the
          insurance requirements contained in such Mortgage;

                 (11) with respect to each Mortgaged Real Property, such
          affidavits, certificates, information (including financial data) and
          instruments of indemnification (including a so-called "gap"
          indemnification) as shall be required to induce the title company to
          issue the policy or policies (or commitment or commitments) and
          endorsements contemplated in subparagraph (8) above;

                 (12) evidence acceptable to the Collateral Agent of payment by
          the Loan Parties of all applicable title insurance premiums, search
          and examination charges, survey costs and related charges, mortgage
          recording taxes, fees, charges, costs and expenses required for the
          recording of the Mortgages and issuance of the title insurance
          policies referred to in subparagraph (8) above; and

                 (13) with respect to each Mortgaged Property, an Officer's
          Certificate substantially in the form of Exhibit K.
                                                   ----------

          (i) Each of the Subsidiary Guarantee Agreement and the Indemnity,
     Subrogation and Contribution Agreement shall have been duly executed by the
     parties thereto, shall have been delivered to the Collateral Agent and
     shall be in full force and effect.

          (j) The Administrative Agent shall have received a copy of, or a
     certificate as to coverage under, the insurance policies required by
     Section 5.02 and the applicable provisions of the Security Documents, each
     of which shall be endorsed or otherwise amended to include a "standard" or
     "New York" lender's loss payable endorsement and to name the Collateral
     Agent as additional insured, in form and substance reasonably satisfactory
     to the Administrative Agent.

          (k) After giving effect to the Transactions, and the affiliation
     agreements to be entered into in connection therewith, (A) the ratio of (a)
     Consolidated Indebtedness as of the Closing Date to (b) Consolidated EBITDA
     on a pro forma basis for the Transactions for the twelve-month period
     ending with the fiscal quarter immediately preceding the Closing Date shall
     not be greater than 4.0:1.00 and (B) the Consolidated EBITDA on a pro forma
     basis for the Transactions for the twelve-month period ending with the
     fiscal quarter ended February 29, 2000 shall be no less than $111.9
     million.

          (l) The Transactions shall have been consummated or shall be
     consummated simultaneously on the Closing Date, in each case in all
     material respects in accordance with the terms hereof and the terms of the
     Transaction Documents, which shall be reasonably satisfactory to the
     Lenders (and without the waiver of any such terms not approved by the
     Administrative Agent (such approval not to be unreasonably withheld)).

          (m) The New Senior Subordinated Notes shall be issued in the form
     required by the terms of the New Senior Subordinated Note Indenture, which
     shall be reasonably satisfactory to the Lenders
<PAGE>

                                      -62-

     and the Borrower shall have received (or have the unconditional right to
     receive) at least $115.0 million in proceeds therefrom substantially
     contemporaneously with the initial Credit Event.

          (n) The Administrative Agent shall have received an opinion (and
     related going concern valuation) reasonably satisfactory in all respects to
     the Administrative Agent from American Appraisal Associates, Inc. to the
     effect that, after giving effect to the Transactions, the Borrower and the
     Subsidiaries (taken as a whole) will not (i) be insolvent, (ii) be rendered
     insolvent by the indebtedness incurred in connection therewith, (iii) be
     left with unreasonably small capital with which to engage in their business
     or (iv) have incurred debts beyond their ability to pay such debts as they
     mature.

          (o) After giving effect to the Transactions and the other transactions
     contemplated hereby, neither the Borrower nor any of the Subsidiaries shall
     have outstanding any Indebtedness or preferred stock other than (i) the
     Loans and extensions of credit hereunder and (ii) the New Senior
     Subordinated Notes.

                                   ARTICLE V

                             Affirmative Covenants

     The Borrower covenants and agrees with each Lender that so long as this
Agreement shall remain in effect and until the Commitments have been terminated
and the principal of and interest on each Loan, all Fees and all other expenses
or amounts payable under any Loan Document shall have been paid in full and all
Letters of Credit have been canceled or have expired and all amounts drawn
thereunder have been reimbursed in full, unless the Required Lenders shall
otherwise consent in writing, the Borrower will, and will cause each of the
Subsidiaries to:

     SECTION 5.01.  Existence; Businesses and Properties. (a) Do or cause to be
done all things necessary to preserve, renew and keep in full force and effect
its legal existence, except as otherwise expressly permitted under Section 6.05.

     (b) Do or cause to be done all things necessary to obtain, preserve, renew,
extend and keep in full force and effect the rights, licenses, permits,
franchises, authorizations, patents, copyrights, trademarks and trade names
material to the conduct of its business; maintain and operate such business in
substantially the manner in which it is presently conducted and operated; comply
with all applicable laws, rules, regulations (including any zoning, building,
Environmental Law, ordinance, code or approval or any building permits or any
restrictions of record or agreements affecting the Real Properties) and decrees
and orders of any Governmental Authority, whether now in effect or hereafter
enacted, except where the failure to comply could not reasonably be expected to
have a Material Adverse Effect; and at all times maintain and preserve all
Property material to the conduct of such business and keep such Property in good
repair, working order and condition and from time to time make, or cause to be
made, all needful and proper repairs, renewals, additions, improvements and
replacements thereto necessary in order that the business carried on in
connection therewith may be properly conducted at all times.

     SECTION 5.02.  Insurance.  (a)  Keep its insurable Properties adequately
insured at all times by financially sound and reputable insurers; maintain such
other insurance, to such extent and against such risks, including fire and other
risks insured against by extended coverage, as is customary with companies in
the same or similar businesses operating in the same or similar locations,
including public liability insurance against claims
<PAGE>

                                      -63-

for personal injury or death or property damage occurring upon, in, about or in
connection with the use of any Properties owned, occupied or controlled by it;
maintain such other insurance as may be required by law; and, with respect to
Collateral, otherwise maintain all insurance coverage required under the
applicable Security Documents.

     (b) Notify the Administrative Agent and the Collateral Agent immediately
whenever any separate insurance concurrent in form or contributing in the event
of loss with that required to be maintained under this Section 5.02 is taken out
by the Borrower; and promptly deliver to the Administrative Agent and the
Collateral Agent a duplicate original copy of such policy or policies.

     SECTION 5.03.  Obligations and Taxes.  Pay its Indebtedness and other
obligations promptly and in accordance with their terms and pay and discharge
promptly when due all taxes, assessments and governmental charges or levies
imposed upon it or upon its income or profits or in respect of its property,
before the same shall become delinquent or in default, as well as all lawful
claims for labor, materials and supplies or otherwise that, if unpaid, might
give rise to a Lien upon such properties or any part thereof; provided, however,
that such payment and discharge shall not be required with respect to any such
tax, assessment, charge, levy or claim so long as the validity or amount thereof
shall be contested in good faith by appropriate proceedings and the Borrower
shall have set aside on its books adequate reserves with respect thereto in
accordance with GAAP and such contest operates to suspend collection of the
contested obligation, tax, assessment or charge and enforcement of a Lien and,
in the case of Collateral, the Borrower or the applicable Subsidiary shall have
otherwise complied with the provisions of the applicable Security Document in
connection with such nonpayment.

     SECTION 5.04.  Financial Statements, Reports, etc.  Furnish to the
Administrative Agent and each Lender:

          (a) within 90 days after the end of each fiscal year, its consolidated
     and consolidating balance sheet and related statements of income and cash
     flows showing the financial condition of the Borrower and the Subsidiary
     Guarantors and other Subsidiaries as of the close of such fiscal year and
     the results of its operations and the operations of such Subsidiary
     Guarantors and other Subsidiaries during such year, all in reasonable
     detail and audited by PricewaterhouseCoopers LLP or other independent
     public accountants of recognized national standing and accompanied by an
     opinion of such accountants (which shall not be qualified in any material
     respect) to the effect that such consolidated financial statements fairly
     present in all material respects the financial condition and results of
     operations of the Borrower and the Subsidiaries on a consolidated basis in
     accordance with GAAP consistently applied, setting forth in each case in
     comparative form (i) the corresponding statements for the preceding fiscal
     year and (ii) the budget corresponding to such period previously provided
     pursuant to Section 5.04(f);

          (b) within 45 days after the end of each of the first three fiscal
     quarters of each fiscal year, its consolidated and consolidating balance
     sheet and related statements of income and cash flows showing the financial
     condition of the Borrower and the Subsidiary Guarantors and other
     Subsidiaries as of the close of such fiscal quarter and the results of its
     operations and the operations of such Subsidiary Guarantors and other
     Subsidiaries during such fiscal quarter and the then elapsed portion of the
     fiscal year, all in reasonable detail and certified by one of its Financial
     Officers as fairly presenting in all material respects the financial
     condition and results of operations of each of the Borrower and the
     Subsidiary Guarantors and other Subsidiaries on a consolidated basis in
     accordance with GAAP consistently applied, subject to normal year-end audit
     adjustments, setting forth in each case in comparative
<PAGE>

                                      -64-

     form (i) the corresponding statements for the corresponding period in the
     preceding fiscal year and (ii) the budget corresponding to such period
     previously provided pursuant to Section 5.04(f);

          (c) (i) concurrently with any delivery of financial statements under
     sub-paragraph (a), (b) or (c) above, a certificate of a Financial Officer
     opining on or certifying such statements certifying that no Event of
     Default or Default has occurred or, if such an Event of Default or Default
     has occurred, specifying the nature and extent thereof and any corrective
     action taken or proposed to be taken with respect thereto, (ii)
     concurrently with any delivery of financial statements under sub-paragraph
     (a) or (b) above, a certificate of a Financial Officer opining on or
     certifying such statements setting forth computations in reasonable detail
     satisfactory to the Administrative Agent demonstrating compliance with the
     covenants contained in Sections 6.08, 6.09, 6.10 and 6.11 and, in the case
     of paragraph (a) above, setting forth the Borrower's calculation of Excess
     Cash Flow and excess cash flow (as defined in the New Senior Subordinated
     Note Indenture) and (iii) in the case of paragraph (a) above, a report of
     the accounting firm opining on or certifying such financial statements
     stating that in the course of its regular audit of the financial statements
     of the Borrower and the Subsidiaries, which audit was conducted in
     accordance with GAAP, such accounting firm obtained no knowledge that any
     Event of Default or Default has occurred or, if in the opinion of such
     accounting firm such an Event of Default or Default has occurred,
     specifying the nature and extent thereof;

          (d) promptly after the same become publicly available, copies of all
     periodic and other reports, proxy statements and other materials filed by
     the Borrower or any Subsidiary with the Securities and Exchange Commission,
     or any Governmental Authority succeeding to any or all of the functions of
     said Commission, or with any national securities exchange, or distributed
     to holders of its Indebtedness pursuant to the terms of the documentation
     governing such Indebtedness (or any trustee, agent or other representative
     therefor), as the case may be;

          (e) promptly after the receipt thereof by the Borrower or any of the
     Subsidiaries, a copy of any "management letter" received by any such person
     from its certified public accountants and the management's responses
     thereto;

          (f) no later than 45 days following the first day of each fiscal year
     of the Borrower, a budget in form reasonably satisfactory to the
     Administrative Agent (including budgeted statements of income by each of
     the Borrower's business segments and consolidated as to sources and uses of
     cash and balance sheets) prepared by the Borrower for each of the four
     quarters of such fiscal year prepared in the same level of detail as
     prepared for and delivered to the Borrower's Board of Directors, in each
     case, of the Borrower and the Subsidiaries, accompanied by the statement of
     a Financial Officer of the Borrower to the effect that the budget is a
     reasonable estimate for the period covered thereby.

          (g) promptly, from time to time, such other information regarding the
     operations, business affairs and financial condition of the Borrower or any
     Subsidiary, or compliance with the terms of any Loan Document, as the
     Administrative Agent or any Lender may reasonably request.

     SECTION 5.05.  Litigation and Other Notices.  Furnish to the
Administrative Agent, the Issuing Bank and each Lender prompt written notice of
the following:

          (a) any Event of Default or Default, specifying the nature and extent
     thereof and the corrective action (if any) taken or proposed to be taken
     with respect thereto;
<PAGE>

                                      -65-

          (b) the filing or commencement of, or any threat or notice of
     intention of any person to file or commence, any action, suit or
     proceeding, whether at law or in equity or by or before any Governmental
     Authority, against the Borrower or any Affiliate thereof that could
     reasonably be expected to result in a Material Adverse Effect;

          (c) any development that has resulted in, or could reasonably be
     expected to result in, a Material Adverse Effect; and

          (d) (i) the incurrence of any Lien (other than Prior Liens and other
     Liens expressly permitted by the terms of the applicable Security Document)
     on, or Claim asserted against, any of the Collateral or (ii) the occurrence
     of any other event which could materially affect the value of the
     Collateral.

     SECTION 5.06.  Employee Benefits.  (a)  Comply in all material respects
with the applicable provisions of ERISA and the Code and (b) furnish to the
Administrative Agent (i) as soon as possible after, and in any event within 30
days after any Responsible Officer of the Borrower or any ERISA Affiliate knows
or has reason to know that, any ERISA Event has occurred that, alone or together
with any other ERISA Event could reasonably be expected to result in liability
of the Borrower in an aggregate amount exceeding $500,000, a statement of a
Financial Officer of the Borrower setting forth details as to such ERISA Event
and the action, if any, that the Borrower proposes to take with respect thereto.

     SECTION 5.07.  Maintaining Records; Access to Properties and Inspections.
Keep proper books of record and account in which full, true and correct entries
in conformity with GAAP and all requirements of law are made of all dealings and
transactions in relation to its business and activities.  Each Loan Party will,
and will cause each of its Subsidiaries to, permit any representatives
designated by the Administrative Agent or any Lender to visit and inspect the
financial records and the Properties of the Borrower, the Borrower or any
Subsidiary at reasonable times and as often as reasonably requested and to make
extracts from and copies of such financial records, and permit any
representatives designated by the Administrative Agent or any Lender to discuss
the affairs, finances and condition of the Borrower, the Borrower or any
Subsidiary with the officers thereof and independent accountants therefor.

     SECTION 5.08.  Use of Proceeds. Use the proceeds of the Loans and request
the issuance of Letters of Credit only for the purposes set forth in the
preamble to this Agreement.

     SECTION 5.09.  Compliance with Environmental Laws. Comply, and use its best
efforts to cause all lessees and other persons occupying its Properties to
comply, with all Environmental Laws and Environmental Permits applicable to its
operations and Properties; obtain and renew all material Environmental Permits
necessary for its operations and Properties except where the failure to comply
could not reasonably be expected to have a Material Adverse Effect; and conduct
any Remedial Action in accordance with Environmental Laws; provided, however,
that none of the Borrower, the Borrower or any of the Subsidiaries shall be
required to undertake any Remedial Action required by Environmental Laws to the
extent that its obligation to do so is being contested in good faith and by
proper proceedings and appropriate reserves are being maintained with respect to
such circumstances in accordance with GAAP.

     SECTION 5.10.  Preparation of Environmental Reports. If a Default caused by
reason of a breach of Section 3.17 or 5.09 shall have occurred and be continuing
for more than 25 days without the Borrower or the Subsidiaries commencing
activities reasonably likely to cure such Default, at the written request of the
Required Lenders through the Administrative Agent, provide to the Lenders within
45 days after such request, at the ex-
<PAGE>

                                      -66-

pense of the Borrower, an environmental site assessment report regarding the
matters which are the subject of such default prepared by an environmental
consulting firm reasonably acceptable to the Administrative Agent and indicating
the presence or absence of Hazardous Materials and the estimated cost of any
compliance or Remedial Action in connection with such Default.

     SECTION 5.11.  Further Assurances; Additional Collateral.  (a)  Execute
any and all further documents, financing statements, agreements and instruments,
and take all further action (including, without limitation, filing UCC and other
financing statements, mortgages and deeds of trust and filings with the United
States Patent and Trademark Office and the United States Copyright Office) that
may be required under applicable law, or that the Required Lenders, the
Administrative Agent or the Collateral Agent may reasonably request, in order to
effectuate the transactions contemplated by the Loan Documents and in order to
grant, preserve, protect and perfect the validity and first priority of the
security interests created or intended to be created by the Security Documents.

     (b) The Borrower will cause any existing or subsequently acquired or
organized Domestic Subsidiary having annual sales or assets in excess of
$5,000,000 to execute a Subsidiary Guarantee Agreement, and the Borrower will
cause any existing or subsequently acquired or organized Domestic Subsidiary to
execute an Indemnity Subrogation and Contribution Agreement and each applicable
Security Document in favor of the Collateral Agent as shall be necessary or
appropriate to grant a first priority Lien on, and security interest in, the
Property owned or held by such Domestic Subsidiary and to take all further
action of the type described in this Section 5.11 in order to grant, preserve,
protect and perfect such Lien and security interest.

     (c) The parties hereto acknowledge and agree that it is their intention
that the Obligations shall be secured by, among other things, a first priority
Lien on substantially all the Property of the Borrower and the Domestic
Subsidiaries (including, without limitation, real and other Property acquired
subsequent to the Closing Date).  Promptly, and in any event within 30 days
after the acquisition of any Property by the Borrower and/or the Domestic
Subsidiaries, the Borrower and/or the Domestic Subsidiaries will, at their sole
cost and expense, promptly secure the Obligations by pledging or creating, or
causing to be pledged or created, first priority perfected security interests
with respect to such property (the "Additional Collateral").  Such security
interests and Liens will be created under the Security Documents and other
security agreements, mortgages, deeds of trust and other instruments and
documents in form and substance reasonably satisfactory to the Collateral Agent,
and the Borrower shall deliver or cause to be delivered to the Collateral Agent
all such instruments and documents (including, without limitation, legal
opinions, title insurance policies, surveys, appraisals, certificates of title,
consents and lien searches) as the Collateral Agent shall reasonably request to
evidence compliance with this Section 5.11 (provided, however, that with respect
                                            --------
to any newly-acquired leasehold Real Property, the Borrower and/or Domestic
Subsidiary acquiring such leasehold interest will mortgage, pledge or assign the
underlying lease to the Collateral Agent at the request of the Collateral Agent
if such Real Property is material to the business, operations or financial
condition of the Borrower and/or Domestic Subsidiary in the reasonable
determination of the Collateral Agent); provided, however, that if the
                                        --------  -------
underlying lease relating to any leasehold Real Property interest acquired by
the Borrower and/or the Domestic Subsidiaries by its terms or by operation of
law cannot be mortgaged, pledged or assigned as contemplated herein without the
consent of the lessor thereunder, the Borrower and/or Domestic Subsidiary
acquiring such leasehold interest shall be required to use its commercially
reasonable efforts to obtain such consent as soon as practicable but in no event
later than 60 days from the date the Borrower and/or the Domestic Subsidiaries
acquired such leasehold interest, however, the failure to obtain such consent
shall not result in a Default hereunder.

     (d) The Borrower agrees to, from time to time, provide such evidence as the
Collateral Agent shall reasonably request as to the perfection and priority
status of each security interest and Lien contemplated.  In
<PAGE>

                                      -67-

addition, pursuant to Section 2.24, the Borrower will cause the Assumption
Agreement to be executed by the applicable Domestic or Foreign Subsidiary.

     (e) With respect to each leased Real Property identified on Schedule
                                                                 --------
3.07(a)(ii) attached hereto, to the extent not delivered to the Collateral Agent
-----------
on the Closing Date, the Borrower will and will cause each Domestic Subsidiary
to use its commercially reasonable efforts to obtain and deliver to the
Collateral Agent, as soon as practicable but in no event later than 60 days from
the Closing Date, a landlord lien waiver, consent (if applicable) and access
agreement, substantially in the form of Exhibit L attached hereto; provided,
                                        ---------                  --------
however, that if, notwithstanding the use of its commercially reasonable
-------
efforts, the Borrower and/or the applicable Domestic Subsidiary shall fail to
obtain such landlord lien waiver such failure shall not result in a Default
hereunder.

     SECTION 5.12.  Interest Rate Protection. No later than the 60th day after
the Closing Date, the Borrower shall enter into, and for a minimum of two years
thereafter maintain, Interest Rate Protection Agreements acceptable to the
Administrative Agent that results in at least the lesser of 50% or $200.0
million of the aggregate principal amount of the Borrower's Consolidated
Indebtedness being effectively subject to a fixed or maximum interest rate
reasonably acceptable to the Administrative Agent unless the Borrower shall have
at least $200.0 million aggregate principal amount of Consolidated Indebtedness
incurred and outstanding in compliance with this Agreement that is subject to a
fixed rate.

                                   ARTICLE VI

                               Negative Covenants

     The Borrower covenants and agrees with each Lender that, so long as this
Agreement shall remain in effect and until the Commitments have been terminated
and the principal of and interest on each Loan, all Fees and all other expenses
or amounts payable under any Loan Document have been paid in full and all
Letters of Credit have been cancelled or have expired and all amounts drawn
thereunder have been reimbursed in full, unless the Required Lenders shall
otherwise consent in writing, the Borrower will not, nor will it cause or permit
any of the Subsidiaries to:

     SECTION 6.01.  Indebtedness. Incur, create, assume or permit to exist any
Indebtedness, except:

          (a) Indebtedness incurred pursuant to this Agreement and the other
     Loan Documents; provided, that the Borrower may incur the Tranche C Term
     Loans in an aggregate principal amount of $50,000,000 pursuant to Section
     2.25, if at the time of the incurrence thereof the Senior Leverage Ratio,
     on a pro forma basis for such incurrence, is less than 2.50:1.00;

          (b) Indebtedness of the Borrower pursuant to the New Senior
     Subordinated Notes issued on or before the Closing Date, in an aggregate
     principal amount not to exceed $200,000,000, less the aggregate amount of
     all repayments of New Senior Subordinated Notes effected after the Closing
     Date;

          (c) Indebtedness of the Borrower pursuant to the New Senior
     Subordinated Notes issued after the Closing Date in an aggregate amount,
     together with the Indebtedness permitted under Section 6.01(b) not to
     exceed $200,000,000 at any one time outstanding;
<PAGE>

                                      -68-

          (d) Indebtedness actually outstanding on the Closing Date and listed
     on Schedule 6.01, but not any refinancings or renewals thereof; provided
     that Capital Lease Obligations assumed in connection with the Acquisition
     and set forth on Schedule 6.01 may be refinanced or renewed so long as (i)
     such refinanced Capital Lease Obligations are in an aggregate principal
     amount not greater than the aggregate principal amount of the Capital Lease
     Obligations being renewed or refinanced, plus the amount of any premiums
     required to be paid thereon and fees and expenses associated therewith,
     (ii) such refinanced Capital Lease Obligations have a later or equal final
     maturity and longer or equal weighted average life than the Capital Lease
     Obligations being renewed or refinanced and (iii) the covenants, events of
     default and other provisions thereof (including any guarantees thereof)
     shall be, in the aggregate, no less favorable to the Lenders than those
     contained in the Capital Lease Obligations being renewed or refinanced;

          (e) Indebtedness under Interest Rate Protection Agreements entered
     into in compliance with Section 5.12, and such other non-speculative
     Interest Rate Protection Agreements which may be entered into from time to
     time by the Borrower and which the Borrower in good faith believes will
     provide protection against fluctuations in interest rates with respect to
     floating rate Indebtedness then outstanding, and permitted to remain
     outstanding, pursuant to the other provisions of this Section 6.01;

          (f) Indebtedness evidenced by Capital Lease Obligations to the extent
     permitted pursuant to Section 6.08; provided that in no event shall the
     aggregate principal amount of Capital Lease Obligations permitted by this
     paragraph (e) exceed $5,000,000 at any time outstanding;

          (g) intercompany Indebtedness of the Borrower and its Subsidiaries
     outstanding to the extent permitted by Section 6.04(f);

          (h) in addition to any Indebtedness permitted by the preceding
     paragraph (g), Indebtedness of any Wholly Owned Subsidiary to the Borrower
     or another Wholly Owned Subsidiary constituting the purchase price in
     respect of intercompany transfers of goods and services made in the
     ordinary course of business to the extent not constituting Indebtedness for
     borrowed money;

          (i) Indebtedness under performance bonds, letter of credit obligations
     to provide security for worker's compensation claims and bank overdrafts,
     in each case incurred in the ordinary course of business; provided that any
     obligations arising in connection with such bank overdraft Indebtedness is
     extinguished within five Business Days;

          (j) Indebtedness evidenced by Other Hedging Agreements entered into
     pursuant to Section 6.04(e);

          (k) subject to Section 6.01(m) below, Indebtedness incurred by Foreign
     Subsidiaries incurred from time to time after the Closing Date so long as
     the aggregate principal amount of all Indebtedness (including trade letters
     of credit) incurred pursuant to this paragraph (k) at any time outstanding
     does not exceed the Dollar Equivalent of $20,000,000; provided, none of the
     Indebtedness permitted pursuant to this paragraph (k) may be directly or
     indirectly guaranteed by the Borrower or any Domestic Subsidiaries of the
     Borrower;

          (l) Indebtedness evidenced by an Accounts Receivable Facility not to
     exceed $75.0 million in the aggregate outstanding at any time; provided, no
     such Indebtedness shall be incurred at a time
<PAGE>

                                      -69-

     when, on a pro forma basis for any such incurrence, the Senior Leverage
     Ratio is greater than 2.0:1.0; and

          (m) additional Indebtedness of the Borrower and its Subsidiaries to
     the extent not permitted by the foregoing clauses of this Section 6.01 not
     to exceed $10.0 million in aggregate principal amount at any time
     outstanding; provided, the aggregate amount of Indebtedness under Sections
     6.01(k) and (m) does not exceed $25.0 million at any one time.

     SECTION 6.02.  Liens.  (i) Create, incur, assume or permit to exist,
directly or indirectly, any Lien upon or with respect to any Collateral except
for Prior Liens and other Liens expressly permitted by the terms of the
applicable Security Documents and (ii) create, incur, assume or permit to exist
any Lien on any Property that does not constitute Collateral now owned or
hereafter acquired by it or on any income or revenues or rights in respect of
any thereof, except:

          (a) inchoate Liens for taxes, assessments or governmental charges or
     levies not yet due and payable or Liens for taxes, assessments or
     governmental charges or levies being contested in good faith and by
     appropriate proceedings for which adequate reserves have been established
     in accordance with GAAP in the United States (or the equivalent thereof in
     any country in which a Foreign Subsidiary is doing business, as
     applicable);

          (b) Liens in respect of property or assets of the Borrower or any of
     the Subsidiaries imposed by law, which were incurred in the ordinary course
     of business and do not secure Indebtedness for borrowed money, such as
     carriers', warehousemen's, materialmen's, landlord's and mechanics' liens
     and other similar Liens arising in the ordinary course of business, and (i)
     which do not in the aggregate materially detract from the value of the
     property or assets of the Borrower and the Subsidiaries, taken as a whole,
     and do not materially impair the use thereof in the operation of the
     business of the Borrower and the Subsidiaries, taken as a whole, or (ii)
     which are being contested in good faith by appropriate proceedings, which
     proceedings (or orders entered in connection with such proceedings) have
     the effect of preventing the forfeiture or sale of the property or assets
     subject to any such Lien;

          (c) Liens in existence on the Closing Date and set forth on Schedule
     6.02 (including Liens set out on any applicable title insurance policy on
     the Closing Date); provided that (i) the aggregate principal amount of the
     Indebtedness, if any, secured by such Liens does not increase and (ii) such
     Liens do not encumber any additional assets or properties of the Borrower
     or any of the Subsidiaries;

          (d) Liens created pursuant to the Security Documents;

          (e) Liens placed upon assets used in the ordinary course of business
     of the Borrower or any of its Subsidiaries at the time of acquisition
     thereof by the Borrower or any such Subsidiary or within 90 days thereafter
     to secure Indebtedness incurred to pay all or a portion of the purchase
     price thereof or Liens upon assets of the Borrower and its Subsidiaries
     subject to Capital Lease Obligations to the extent permitted by Section
     6.01; provided that (i) such Liens only serve to secure the payment of
     Indebtedness arising under such Capital Lease Obligation and (ii) the Lien
     encumbering the asset giving rise to the Capital Lease Obligation does not
     encumber any other asset (other than proceeds thereof) of the Borrower or
     any Subsidiary of the Borrower; provided that (i) the aggregate outstanding
     principal amount of all Indebtedness secured by Liens permitted by this
     paragraph (e) shall not at any time exceed $5,000,000 and (ii) in all
     events, the Lien encumbering the assets so acquired does not encumber any
     other asset (other than proceeds thereof) of the Borrower or such
     Subsidiary;
<PAGE>

                                      -70-

          (f) easements, rights-of-way, restrictions (including zoning
     restrictions), covenants encroachments, protrusions and other similar
     charges or encumbrances, and minor title deficiencies, in each case whether
     now or hereafter in existence, not securing Indebtedness and not materially
     interfering with the conduct of the business of the Borrower and the
     Subsidiaries taken as a whole or the Borrower;

          (g) Liens arising out of judgments or awards not giving rise to an
     Event of Default in respect of which the Borrower or any of its
     Subsidiaries shall in good faith be prosecuting an appeal or proceedings
     for review in respect of which there shall be secured a subsisting stay of
     execution pending such appeal or proceedings;

          (h) Liens (other than any Lien imposed by ERISA) (i) incurred or
     deposits made in the ordinary course of business in connection with
     workers' compensation, unemployment insurance and other types of social
     security, (ii) to secure the performance of tenders, statutory obligations
     (other than excise taxes), surety, stay, customs and appeal bonds,
     statutory bonds, bids, leases, government contracts, trade contracts,
     performance and return of money bonds and other similar obligations
     (exclusive of obligations for the payment of borrowed money) or (iii)
     arising by virtue of deposits made in the ordinary course of business to
     secure liability for premiums to insurance carriers; provided that the
     aggregate amount of deposits at any time pursuant to clause (ii) and clause
     (iii) shall not exceed $1,000,000 in the aggregate;

          (i) any interest or title of a lessor, sublessor, licensee or licensor
     under any lease or license agreement permitted by this Agreement, including
     any Lien filed to prevent the impairment of any such interest;

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

          (k) Liens arising out of conditional sale, title retention,
     consignment or similar arrangements for the sale of goods entered into by
     the Borrower or any of its Subsidiaries in the ordinary course of business
     in accordance with the past practices of the Borrower and its Subsidiaries;

          (l) Liens on assets of Foreign Subsidiaries; provided that (i) such
     Liens do not extend to, or encumber, assets which constitute Collateral or
     the capital stock of the Borrower or any of its Subsidiaries, (ii) such
     Liens extending to the assets of any Foreign Subsidiary secure only
     Indebtedness incurred by such Foreign Subsidiary pursuant to Section
     6.01(k); and

          (m) Liens not otherwise permitted by the foregoing paragraphs (a)
     through (l) to the extent attaching to properties and assets with an
     aggregate fair value not in excess of, and securing liabilities not in
     excess of, $5,000,000 in the aggregate at any time outstanding.

     SECTION 6.03.  Sale and Lease-Back Transactions. Enter into any
arrangement, directly or indirectly, with any person whereby it shall sell or
transfer any property, real or personal, used or useful in its business, whether
now owned or hereafter acquired, and thereafter rent or lease such property or
other property which it intends to use for substantially the same purpose or
purposes as the property being sold or transferred unless (i) the sale of such
property is permitted by Section 6.05 and (ii) any Liens arising in connection
with its use of such property are permitted by Section 6.02(e).
<PAGE>

                                      -71-

     SECTION 6.04.  Investments, Loans and Advances. Directly or indirectly,
lend money or credit or make advances to any person, or purchase or acquire any
stock, obligations or securities of, or any other interest in, or make any
capital contribution to, any other person, or purchase or own a futures contract
or otherwise become liable for the purchase or sale of currency or other
commodities at a future date in the nature of a futures contract, except that
the following shall be permitted:

          (a) the Borrower and its Subsidiaries may acquire and hold accounts
     receivables owing to any of them;

          (b) the Borrower and its Subsidiaries may make loans and advances or
     guarantees of loans or advances in the ordinary course of business to their
     respective employees so long as the aggregate principal amount thereof at
     any time outstanding (determined without regard to any write-downs or
     write-offs of such loans and advances) shall not exceed $6,000,000;

          (c) the Borrower may enter into Interest Rate Protection Agreements to
     the extent permitted in Section 6.01(e);

          (d) the Borrower and the Subsidiaries may consummate the Transactions;

          (e) the Borrower may enter into and perform its obligations under
     Other Hedging Agreements entered into in the ordinary course of business
     and so long as any such Other Hedging Agreement is not speculative in
     nature and is (i) related to income derived from foreign operations of the
     Borrower or any Subsidiary or otherwise related to purchases permitted
     hereunder from foreign suppliers or (ii) entered into to protect the
     Borrower and/or its Subsidiaries against fluctuations in the prices of raw
     materials used in their businesses;

          (f) any Wholly Owned Subsidiary may make intercompany loans to the
     Borrower or any Wholly Owned Subsidiary and the Borrower may make
     intercompany loans and advances to any Wholly Owned Subsidiary; provided
     that any promissory notes evidencing such intercompany loans shall be
     pledged (and delivered) by the Borrower or the respective Domestic Wholly
     Owned Subsidiary that is the lender of such intercompany loan as Collateral
     pursuant to the Pledge Agreement, provided further that (i) neither the
     Borrower nor any Domestic Subsidiaries of the Borrower may make loans to
     any Foreign Subsidiaries of the Borrower pursuant to this paragraph (f) and
     (ii) any loans made by any Foreign Subsidiaries to the Borrower or any of
     its Domestic Subsidiaries pursuant to this paragraph (f) shall be
     subordinated to the obligations of the Loan Parties pursuant to
     subordination provisions reasonably acceptable to the Agent;

          (g) the Borrower and its Subsidiaries may sell or transfer amounts to
     the extent permitted by Section 6.05;

          (h) the Borrower may establish Subsidiaries to the extent permitted by
     Section 6.15;

          (i) the Borrower and its Domestic Wholly Owned Subsidiaries may make
     loans and advances to, or other investments in, Foreign Subsidiaries of the
     Borrower so long as the aggregate amount of any loans, advances or other
     investments made after the Closing Date at any time outstanding (determined
     without regard to any write-downs or write-offs thereof) pursuant to this
     paragraph (i) shall not exceed $30,000,000; and
<PAGE>

                                      -72-

          (j) in addition to investments permitted by clauses (a) through (i)
     above, the Borrower and its Subsidiaries may make any acquisition of assets
     relating to, or equity interests in a person engaged in, a business that
     complies with Section 6.16; provided, (i) no single acquisition is for cash
     consideration exceeding $25.0 million, (ii) the aggregate amount of the
     cash consideration for all such acquisitions does not exceed $50.0 million
     in any fiscal year and (iii) the aggregate amount of consideration for all
     such acquisitions does not exceed $150.0 million at any time after the
     Closing Date (of which no more than $100.0 million may be in cash);
     provided, however, that with respect to any such acquisition the Borrower,
     on a pro forma basis for such acquisition, would have (I) a Senior Leverage
     Ratio less than 2.5:1.00 and (II) a Leverage Ratio, the numerator of which
     is at least .25 less than the maximum then allowable under Section 6.11
     (any such acquisition pursuant to this Section 6.04(j), a "Permitted
                                                                ---------
     Acquisition").
     -----------

     SECTION 6.05.  Mergers, Consolidations, Sales of Assets and Acquisitions.
Wind up, liquidate or dissolve its affairs or enter into any transaction of
merger or consolidation, or convey, sell, lease or otherwise dispose of (or
agree to do any of the foregoing at any future time) all or any part of its
Property, or purchase or otherwise acquire (in one or a series of related
transactions) any part of the Property (other than purchases or other
acquisitions of inventory, materials, equipment and intangible assets in the
ordinary course of business) of any person (or agree to do any of the foregoing
at any future time), except that:

          (a) Capital Expenditures by the Borrower and its Subsidiaries shall be
     permitted to the extent not in violation of Section 6.08;

          (b) each of the Borrower and its Subsidiaries may (i) in the ordinary
     course of business, sell, lease or otherwise dispose of any assets which,
     in the reasonable judgment of such person, are obsolete, worn out or
     otherwise no longer useful in the conduct of such person's business, and
     (ii) unless an Event of Default shall have occurred and be continuing,
     subject to Section 2.13(b), sell, lease or otherwise dispose of any assets,
     provided that the aggregate consideration received in respect of all assets
     subject to sales or other dispositions pursuant to this clause (b)(ii)
     shall not exceed $10,000,000 in any four fiscal quarters of the Borrower;

          (c) investments may be made to the extent permitted by Section 6.04;

          (d) each of the Borrower and its Subsidiaries may lease (as lessee)
     real or personal Property in the ordinary course of business (so long as
     any such lease does not create a Capital Lease Obligation except to the
     extent permitted by Section 6.01);

          (e) each of the Borrower and its Subsidiaries may make sales or
     transfers of inventory in the ordinary course of business and consistent
     with past practices (including without limitation sales or transfers of
     inventory by the Borrower to its Subsidiaries);

          (f) the Borrower and its Subsidiaries may sell or discount, in each
     case without recourse and in the ordinary course of business, overdue
     accounts receivable arising in the ordinary course of business, but only in
     connection with the compromise or collection thereof consistent with
     customary industry practice (and not as part of any bulk sale);

          (g) licenses, cross-licenses or sublicenses by the Borrower and its
     Subsidiaries of software, trademarks and other intellectual property in the
     ordinary course of business and which do not
<PAGE>

                                      -73-

     materially interfere with the business of the Borrower and the
     Subsidiaries, taken as a whole, or the Borrower shall be permitted;

          (h) the Accounts Receivable Facility, Spin-Off and Divestitures shall
     be permitted; and

          (i) the Borrower or any Domestic Wholly Owned Subsidiary of the
     Borrower may transfer Property or lease to or acquire or lease Property
     from the Borrower or any other Domestic Wholly Owned Subsidiary or any
     Domestic Wholly Owned Subsidiary may be merged into the Borrower (as long
     as the Borrower is the surviving corporation of such merger as a Wholly
     Owned Subsidiary of) or any other Domestic Wholly Owned Subsidiary of the
     Borrower; provided, however, that the Lien on and security interest in such
     Property granted in favor of the Collateral Agent under the Security
     Documents shall be maintained in accordance with the provisions of Section
     5.11.

To the extent the Required Lenders waive the provisions of this Section 6.05
with respect to the sale of any Collateral, or any Collateral is sold as
permitted by this Section 6.05, such Collateral (unless sold to the Borrower or
a Subsidiary) shall be sold free and clear of the Liens created by the Security
Documents, and the Administrative Agent and the Collateral Agent shall be
authorized to take any actions deemed appropriate in order to effect the
foregoing.

   SECTION 6.06.  Dividends.  Authorize, declare or pay any Dividends with
respect to the Borrower or any of its Subsidiaries, except that:

          (a) any Subsidiary of the Borrower (i) may pay cash Dividends to the
     Borrower or any Wholly Owned Subsidiary of the Borrower and (ii) if such
     Subsidiary is not a Wholly Owned Subsidiary, may pay cash Dividends to its
     shareholders generally so long as the Borrower or its respective Subsidiary
     which owns the equity interest or interests in the Subsidiary paying such
     Dividends receives at least its proportionate share thereof (based upon its
     relative holdings of equity interests in the Subsidiary paying such
     Dividends and taking into account the relative preferences, if any, of the
     various classes of equity interests in such Subsidiary);

          (b) so long as there shall exist no Default or Event of Default (both
     before and after giving effect to the payment thereof), the Borrower may
     repurchase outstanding shares of its common stock (or options to purchase
     such common stock) following the death, disability, retirement or
     termination of employment of employees, officers or directors of the
     Borrower or any of its Subsidiaries; provided that (i) all amounts used to
     effect such repurchases are obtained by the Borrower from a substantially
     concurrent issuance of its common stock (or options to purchase such common
     stock) to other employees, members of management, executive officers or
     directors of the Borrower or any of its Subsidiaries or (ii) to the extent
     the proceeds used to effect any repurchase pursuant to this clause (ii) are
     not obtained as described in preceding clause (i), the aggregate amount of
     Dividends paid by the Borrower pursuant to this paragraph (b) (exclusive of
     amounts paid as described pursuant to preceding clause (i)) shall not
     exceed $1,000,000 in any fiscal year of the Borrower; provided that, in the
     event that the maximum amount which is permitted to be expended in respect
     of Dividends during any fiscal year pursuant to this clause (b)(ii) is not
     fully expended during such fiscal year, the maximum amount which may be
     expended during the immediately succeeding fiscal year pursuant to this
     clause (b) (ii) shall be increased by such unutilized amount; and

          (c) the Borrower may consummate the Spin-Off.
<PAGE>

                                      -74-

     SECTION 6.07. Transactions with Affiliates. Enter into any transaction or
series of related transactions, whether or not in the ordinary course of
business, with any Affiliate of the Borrower or any of the Subsidiaries, other
than in the ordinary course of business and on terms and conditions
substantially as favorable to the Borrower or such Subsidiary as would
reasonably be obtained by the Borrower or such Subsidiary at that time in a
comparable arm's-length transaction with a person other than an Affiliate,
except that:

          (a) Dividends may be paid to the extent provided in Section 6.06;

          (b) loans may be made and other transactions may be entered into
     between and among the Borrower, the Subsidiaries and their respective
     Affiliates to the extent permitted by Sections 6.01 and 6.04;

          (c) customary fees may be paid to non-officer directors of the
     Borrower; and

          (d) the Spin-Off may be effected and the transition services as set
     forth on Schedule 6.07.

     SECTION 6.08.  Capital Expenditures.  (a)  Make any Capital Expenditures,
except in the amount specified during the fiscal year set forth below:

                                              Maximum Capital
                   Fiscal Year                  Expenditure
                   -----------                ---------------
                       2001                         $13.5
                       2002                         $14.2
                       2003                         $15.1
                       2004                         $16.0
                       2005                         $16.7
                       2006                         $17.3
                       2007                         $17.9
                       2008                         $18.6

     (b) Notwithstanding anything to the contrary contained in paragraph (a)
above, to the extent that the aggregate amount of Capital Expenditures made by
the Borrower and its Subsidiaries pursuant to  Section 6.08(a) in any fiscal
year of the Borrower is less than the amount permitted by Section 6.08(a) with
respect to such fiscal year, the amount of such difference, but in no case more
than 25% of the amount permitted for such fiscal year, may be carried forward
and used to make Capital Expenditures in the immediately succeeding fiscal year
(after the full amount of Capital Expenditures otherwise permitted to be made
under Section 6.08(a) in such fiscal year, without regard to the provisions of
this paragraph (b), have been made); provided that amounts once carried forward
to such succeeding fiscal year shall lapse and terminate at the end of such
fiscal year.

     (c) In addition to the Capital Expenditures permitted pursuant to preceding
paragraphs (a) and (b), the Borrower and its Subsidiaries may make additional
Capital Expenditures consisting of the reinvestment of proceeds of Net Insurance
Proceeds or Net Condemnation Awards not required to be applied to prepay the
Loans pursuant to Section 2.13(f); provided, however, that the Property acquired
in connection with such reinvestment shall be made subject to the Lien of the
Security Documents pursuant to the provisions of Section 5.11.

     SECTION 6.09.  Consolidated Interest Coverage Ratio  .  Permit the
Consolidated Interest Coverage Ratio for any period comprised of one or more
fiscal quarters from the Closing Date to May 31, 2001, and
<PAGE>

                                      -75-

thereafter for any period of four consecutive fiscal quarters, in each case
taken as one accounting period, ended on the last day of a fiscal quarter
described below to be less than the amount set forth opposite such period below:

          Period                                       Ratio
          ------                                       -----
          Closing Date to 11/30/2000                   1.75:1.00
          12/01/2000 to 2/28/2001                      1.75:1.00
          3/01/2001 to 5/31/2001                       1.75:1.00
          6/01/2001 to 8/31/2001                       1.75:1.00
          9/01/2001 to 11/30/2001                      1.75:1.00
          12/01/2001 to 2/28/2002                      2.00:1.00
          3/01/2002 to 5/31/2002                       2.00:1.00
          6/01/2002 to 8/31/2002                       2.00:1.00
          9/01/2002 to 11/30/2002                      2.00:1.00
          12/01/2002 to 2/28/2003                      2.25:1.00
          3/01/2003 to 5/31/2003                       2.25:1.00
          6/01/2003 to 8/31/2003                       2.25:1.00
          9/01/2003 to 11/30/2003                      2.25:1.00
          12/01/2003 to 2/29/2004                      2.50:1.00
          3/01/2004 to 5/31/2004                       2.50:1.00
          6/01/2004 to 8/31/2004                       2.50:1.00
          9/01/2004 to 11/30/2004                      2.50:1.00
          12/01/2004 to 2/28/2005                      2.75:1.00
          3/01/2005 to 5/31/2005                       2.75:1.00
          6/01/2005 to 8/31/2005                       3.00:1.00
          9/01/2005 to 11/30/2005                      3.00:1.00
          12/01/2005 to 2/28/2006                      3.00:1.00
          3/01/2006 to 5/31/2006                       3.00:1.00
          6/01/2006 to 8/31/2006                       3.00:1.00
          thereafter                                   3.50:1.00

     SECTION 6.10.  Consolidated Fixed Charge Coverage Ratio.  Permit the
Consolidated Fixed Charge Coverage Ratio for any period comprised of one or more
fiscal quarters from the Closing Date to May 31, 2001, and thereafter for any
period of four consecutive fiscal quarters, in each case taken as one accounting
period, ended on the last day of any period set forth below to be less than the
amount set forth opposite such period  below:

          Period                                       Ratio
          ------                                       -----
          Closing Date to 11/30/2000                   1.00:1.00
          12/01/2000 to 2/28/2001                      1.00:1.00
          3/01/2001 to 5/31/2001                       1.05:1.00
          6/01/2001 to 8/31/2001                       1.05:1.00
          9/01/2001 to 11/30/2001                      1.05:1.00
          12/01/2001 to 2/28/2002                      1.05:1.00
          3/01/2002 to 5/31/2002                       1.05:1.00
          6/01/2002 to 8/31/2002                       1.05:1.00
          9/01/2002 to 11/30/2002                      1.05:1.00
          12/01/2002 to 2/28/2003                      1.05:1.00
          3/01/2003 to 5/31/2003                       1.05:1.00
          6/01/2003 to 8/31/2003                       1.05:1.00
          9/01/2003 to 11/30/2003                      1.05:1.00
<PAGE>

                                     -76-

          Period                                          Ratio
          ------                                          -----
          12/01/2002 to 2/28/2003                         1.05:1.00
          3/01/2003 to 5/31/2003                          1.05:1.00
          6/01/2003 to 8/31/2003                          1.05:1.00
          9/01/2003 to 11/30/2003                         1.05:1.00
          12/01/2003 to 2/29/2004                         1.05:1.00
          3/01/2004 to 5/31/2004                          1.05:1.00
          6/01/2004 to 8/31/2004                          1.05:1.00
          thereafter                                      1.10:1:00

     SECTION 6.11.  Maximum Leverage Ratio  .  Permit the Leverage Ratio at any
time during a period set forth below to be greater than the ratio set forth
opposite such period below:

          Period                                          Ratio
          ------                                          -----
          Closing Date to 11/30/2000                      4.50:1.00
          12/01/2000 to 2/28/2001                         4.50:1.00
          3/01/2001 to 5/31/2001                          4.50:1.00
          6/01/2001 to 8/31/2001                          4.50:1.00
          9/01/2001 to 11/30/2001                         4.50:1.00
          12/01/2001 to 2/28/2002                         4.25:1.00
          3/01/2002 to 5/31/2002                          4.25:1.00
          6/01/2002 to 8/31/2002                          4.00:1.00
          9/01/2002 to 11/30/2002                         4.00:1.00
          12/01/2002 to 2/28/2003                         4.00:1.00
          3/01/2003 to 5/31/2003                          3.75:1.00
          6/01/2003 to 8/31/2003                          3.75:1.00
          9/01/2003 to 11/30/2003                         3.75:1.00
          12/01/2003 to 2/29/2004                         3.25:1.00
          3/01/2004 to 5/31/2004                          3.25:1.00
          6/01/2004 to 8/31/2004                          3:25.1.00
          9/01/2004 to 11/30/2004                         3.00:1.00
          12/01/2004 to 2/28/2005                         3.00:1.00
          3/01/2005 to 5/31/2005                          3.00:1.00
          6/01/2005 to 8/31/2005                          3.00:1.00
          9/01/2005 to 11/30/2005                         2.50:1.00
          thereafter                                      2.50:1.00

     SECTION 6.12. Limitation on Modifications of Indebtedness; Modifications of
Certificate of Incorporation, By-laws and Certain Other Agreements, etc. (i)
Amend, waive or modify, or permit the amendment or modification of, any
provision of existing Indebtedness or of any agreement (including, without
limitation, any purchase agreement, indenture, loan agreement or security
agreement) relating thereto other than any amendments or modifications to
Indebtedness which do not in any way materially adversely affect the interests
of the Lenders and are otherwise permitted under Section 6.01(c), (ii) make (or
give any notice in respect thereof) any voluntary or optional payment or
prepayment on or redemption or acquisition for value of, or any prepayment or

<PAGE>

                                      -77-

redemption as a result of any asset sale, change of control, excess cash flow,
proceeds from any Accounts Receivable Facility or similar event of, any
Indebtedness (other than the Loans), including the New Senior Subordinated
Notes, (iii) amend or modify, or permit the amendment or modification of, any
Transaction Document or any of the agreements entered into in connection
therewith or any tax sharing agreement, in each case except for amendments or
modifications which are not in any way adverse in any material respect to the
interests of the Lenders, or (iv) amend, modify or change its Certificate of
Incorporation (including, without limitation, by the filing or modification of
any certificate of designation) or By-laws, or any agreement entered into by it,
with respect to its capital stock (including any shareholders' agreement), or
enter into any new agreement with respect to its capital stock, other than any
amendments, modifications or changes pursuant to this clause (iv) or any such
new agreements pursuant to this clause (iv) which do not in any way materially
adversely affect in any material respect the interests of the Lenders.

     SECTION 6.13. Limitation on Certain Restrictions on Subsidiaries. Directly
or indirectly, create or otherwise cause or suffer to exist or become effective
any encumbrance or restriction on the ability of any Subsidiary to (a) pay
dividends or make any other distributions on its capital stock or any other
interest or participation in its profits owned by the Borrower or any Subsidiary
of the Borrower, or pay any Indebtedness owed to the Borrower or a Subsidiary of
the Borrower, (b) make loans or advances to the Borrower or any of the
Borrower's Subsidiaries or (c) transfer any of its properties or assets to the
Borrower or any of the Borrower's Subsidiaries, except for such encumbrances or
restrictions existing under or by reason of (i) applicable law, (ii) this
Agreement and the other Loan Documents, (iii) the New Senior Subordinated Note
Documents, (iv) customary provisions restricting subletting or assignment of any
lease governing a leasehold interest of the Borrower or a Subsidiary of the
Borrower, (v) customary provisions restricting assignment of any agreement
entered into by the Borrower or a Subsidiary of the Borrower in the ordinary
course of business, (vi) any holder of a Lien permitted by Section 6.02 may
restrict the transfer of the asset or assets subject thereto and (vii)
restrictions which are not more restrictive than those contained in this
Agreement contained in any documents governing any Indebtedness incurred after
the Closing Date in accordance with the provisions of this Agreement.

     SECTION 6.14. Limitation on Issuance of Capital Stock. The Borrower will
not permit any of the Subsidiaries to issue any capital stock (including by way
of sales of treasury stock) or any options or warrants to purchase, or
securities convertible into, capital stock, except (i) for transfers and
replacements of then outstanding shares of capital stock, (ii) for stock splits,
stock dividends and additional issuances which do not decrease the percentage
ownership of the Borrower or any of the Subsidiaries in any class of the capital
stock of such Subsidiary, (iii) in the case of Foreign Subsidiaries of the
Borrower, to qualify directors to the extent required by applicable law, and
(iv) Subsidiaries of the Borrower formed after the Closing Date pursuant to
Section 6.15 may issue capital stock to the Borrower or the respective
Subsidiary of the Borrower which is to own such stock. All capital stock issued
in accordance with this Section 6.14 shall, to the extent required by the Pledge
Agreement, be delivered to the Collateral Agent for pledge pursuant to the
Security Agreement.

     SECTION 6.15. Limitation on Creation of Subsidiaries. Establish, create or
acquire any additional Subsidiaries without the prior written consent of the
Required Lenders; provided that the Borrower may establish or create one or more
Wholly Owned Subsidiaries of the Borrower without such consent so long as (a)
100% of the capital stock of any new Domestic Subsidiary (or all capital stock
of any new Foreign Subsidiary which is owned by any Loan Party, except that not
more than 65% of the voting stock of any such Foreign Subsidiary shall be
required to be so pledged) is upon the creation or establishment of any such new
Subsidiary pledged and delivered to the Collateral Agent for the benefit of the
Secured Parties under the Security Agreement and (b) upon the creation or
establishment of any such new Domestic Subsidiary such Domestic Subsidiary
becomes a party to the applicable Security Documents in accordance with Section
5.11 and the other Loan Documents.

<PAGE>

                                      -78-

     SECTION 6.16.  Business.  Engage (directly or indirectly) in any business
other than the business in which the Borrower and the Subsidiaries are engaged
on the Closing Date and other business reasonably related thereto.

     SECTION 6.17.  Designated Senior Indebtedness.  Designate any
indebtedness as "Designated Senior Indebtedness" for purposes of the New Senior
Subordinated Note Indenture unless the Required Lenders specifically consent
thereto in writing.

     SECTION 6.18.  Fiscal Year.  With respect to the Borrower, change its
fiscal year-end to a date other than August 31.

                                  ARTICLE VII

                               Events of Default

     In case of the happening of any of the following events ("Events of
Default"):

          (a) any representation or warranty made or deemed made in or in
     connection with any Loan Document or the borrowings or issuances of Letters
     of Credit hereunder, or any representation, warranty, statement or
     information contained in any report, certificate, financial statement or
     other instrument furnished in connection with or pursuant to any Loan
     Document, shall prove to have been false or misleading in any material
     respect when so made, deemed made or furnished;

          (b) default shall be made in the payment of any principal of any Loan
     or the reimbursement with respect to any L/C Disbursement when and as the
     same shall become due and payable, whether at the due date thereof or at a
     date fixed for prepayment thereof or by acceleration thereof or otherwise;

          (c) default shall be made in the payment of any interest on any Loan
     or L/C Disbursement or any Fee or any other amount (other than an amount
     referred to in (b) above) due under any Loan Document, when and as the same
     shall become due and payable, and such default shall continue unremedied
     for a period of three Business Days;

          (d) default shall be made in the due observance or performance by the
     Borrower or any Subsidiary of any covenant, condition or agreement
     contained in Section 5.01(a), 5.05, 5.07 or 5.08 or in Article VI;

          (e) default shall be made in the due observance or performance by the
     Borrower or any Subsidiary of any covenant, condition or agreement
     contained in any Loan Document (other than those specified in (b), (c) or
     (d) above) and such default shall continue unremedied or shall not be
     waived for a period of 20 days after written notice thereof from the
     Administrative Agent or any Lender to the Borrower; provided, however, that
                                                         --------  -------
     in the case of any such default by the Borrower or any Subsidiary arising
     out of the occurrence of any default under any Security Document that
     results in a "Material Adverse Effect" (as defined in the applicable
     Security Document) caused by the impairment of the value or utility of the
     Collateral encumbered thereby, such default shall not constitute an Event
     of De-

<PAGE>

                                      -79-

     fault hereunder unless such impairment, individually or in the aggregate
     with all other such impairments, exceeds $5,000,000;

          (f) the Borrower or any Subsidiary shall (i) fail to pay any principal
     or interest, regardless of amount, due in respect of any Indebtedness
     (other than the Obligations) in a principal amount in excess of $5,000,000,
     when and as the same shall become due and payable, or (ii) fail to observe
     or perform any other term, covenant, condition or agreement contained in
     any agreement or instrument evidencing or governing any such Indebtedness
     if the effect of any failure referred to in this clause (ii) is to cause,
     or to permit the holder or holders of such Indebtedness or a trustee on its
     or their behalf (with or without the giving of notice, the lapse of time or
     both) to cause, such Indebtedness to become due prior to its stated
     maturity;

          (g) an involuntary proceeding shall be commenced or an involuntary
     petition shall be filed in a court of competent jurisdiction seeking (i)
     relief in respect of the Borrower or any Subsidiary, or of a substantial
     part of the property or assets of the Borrower or a Subsidiary, under Title
     11 of the United States Code, as now constituted or hereafter amended, or
     any other Federal, state or foreign bankruptcy, insolvency, receivership or
     similar law, (ii) the appointment of a receiver, trustee, custodian,
     sequestrator, conservator or similar official for the Borrower or any
     Subsidiary or for a substantial part of the property or assets of the
     Borrower or a Subsidiary or (iii) the winding-up or liquidation of the
     Borrower or any Subsidiary; and such proceeding or petition shall continue
     undismissed for 60 days or an order or decree approving or ordering any of
     the foregoing shall be entered;

          (h) the Borrower or any Subsidiary shall (i) voluntarily commence any
     proceeding or file any petition seeking relief under Title 11 of the United
     States Code, as now constituted or hereafter amended, or any other Federal,
     state or foreign bankruptcy, insolvency, receivership or similar law, (ii)
     consent to the institution of, or fail to contest in a timely and
     appropriate manner, any proceeding or the filing of any petition described
     in (g) above, (iii) apply for or consent to the appointment of a receiver,
     trustee, custodian, sequestrator, conservator or similar official for the
     Borrower or any Subsidiary or for a substantial part of the property or
     assets of the Borrower or any Subsidiary, (iv) file an answer admitting the
     material allegations of a petition filed against it in any such proceeding,
     (v) make a general assignment for the benefit of creditors, (vi) become
     unable, admit in writing its inability or fail generally to pay its debts
     as they become due or (vii) take any action for the purpose of effecting
     any of the foregoing;

          (i) one or more judgments for the payment of money in an aggregate
     amount in excess of $5,000,000 shall be rendered against the Borrower, any
     Subsidiary or any combination thereof and the same shall remain
     undischarged for a period of 30 consecutive days during which execution
     shall not be effectively stayed, or any action shall be legally taken by a
     judgment creditor to levy upon assets or properties of the Borrower or any
     Subsidiary to enforce any such judgment;

          (j) an ERISA Event shall have occurred that, in the opinion of the
     Required Lenders, when taken together with all other such ERISA Events,
     could reasonably be expected to result in liability of the Borrower and its
     ERISA Affiliates in an aggregate amount exceeding $1,000,000;

          (k) any security interest purported to be created by any Security
     Document shall cease to be, or shall be asserted by the Borrower or any
     other Loan Party not to be, a valid, perfected, first priority (except as
     otherwise expressly provided in this Agreement or such Security Document)
     security interest in the property covered thereby, except to the extent
     that any such loss of perfection or priority

<PAGE>

                                      -80-

     results from the failure of the Collateral Agent to renew timely any
     applicable UCC financing statement or to maintain possession of
     certificates representing securities pledged under the Security Agreement
     and except to the extent that such loss is covered by a lender's title
     insurance policy and the related insurer promptly after such loss shall
     have acknowledged in writing that such loss is covered by such title
     insurance policy;

          (l) at any time after the execution and delivery thereof, (i) the
     Subsidiary Guarantee Agreement for any reason, other than the satisfaction
     in full of all Obligations, shall cease to be in full force and effect
     (other than in accordance with its terms) or shall be declared to be null
     and void, (ii) any Security Document shall cease to be in full force and
     effect (other than by reason of a release of Collateral thereunder in
     accordance with the terms hereof or thereof, the satisfaction in full of
     the Obligations or any other termination of such Security Document in
     accordance with the terms hereof or thereof) or shall be declared null and
     void, or the Collateral Agent shall not have or shall cease to have a valid
     and perfected first priority Lien in any Collateral purported to be covered
     thereby, or (iii) any Loan Party shall contest the validity or
     enforceability of any Loan Document in writing or deny in writing that it
     has any further liability, including with respect to future advances by
     Lenders, under any Loan Document to which it is a party;

          (m) any of the Obligations shall cease to constitute "Senior
     Indebtedness" under and as defined in the New Senior Subordinated Note
     Indenture; or

          (n) there shall have occurred a Change in Control;

then, and in every such event (other than an event with respect to the Borrower
described in paragraph (g) or (h) above), and at any time thereafter during the
continuance of such event, the Administrative Agent may, and at the request of
the Required Lenders shall, by notice to the Borrower, take either or both of
the following actions, at the same or different times:  (i) terminate forthwith
the Commitments and (ii) declare the Loans then outstanding to be forthwith due
and payable in whole or in part, whereupon the principal of the Loans so
declared to be due and payable, together with accrued interest thereon and any
unpaid accrued Fees and all other liabilities of the Borrower accrued hereunder
and under any other Loan Document, shall become forthwith due and payable,
without presentment, demand, protest or any other notice of any kind, all of
which are hereby expressly waived by the Borrower, anything contained herein or
in any other Loan Document to the contrary notwithstanding; and in any event
with respect to the Borrower described in paragraph (g) or (h) above, the
Commitments shall automatically terminate and the principal of the Loans then
outstanding, together with accrued interest thereon and any unpaid accrued Fees
and all other liabilities of the Borrower accrued hereunder and under any other
Loan Document, shall automatically become due and payable, without presentment,
demand, protest or any other notice of any kind, all of which are hereby
expressly waived by the Borrower, anything contained herein or in any other Loan
Document to the contrary notwithstanding.

                                  ARTICLE VIII

               The Administrative Agent and the Collateral Agent

     In order to expedite the transactions contemplated by this Agreement,
Credit Suisse First Boston is hereby appointed to act as Administrative Agent
and Collateral Agent on behalf of the Lenders and the Issuing Bank (for purposes
of this Article VIII, the Administrative Agent and the Collateral Agent are
referred to col-

<PAGE>

                                      -81-

lectively as the "Agents"). Each of the Lenders and each assignee of any such
Lender, hereby irrevocably authorizes the Agents to take such actions on behalf
of such Lender or assignee or the Issuing Bank and to exercise such powers as
are specifically delegated to the Agents by the terms and provisions hereof and
of the other Loan Documents, together with such actions and powers as are
reasonably incidental thereto. The Administrative Agent is hereby expressly
authorized by the Lenders and the Issuing Bank, without hereby limiting any
implied authority, (a) to receive on behalf of the Lenders and the Issuing Bank
all payments of principal of and interest on the Loans, all payments in respect
of L/C Disbursements and all other amounts due to the Lenders hereunder, and
promptly to distribute to each Lender or the Issuing Bank its proper share of
each payment so received; (b) to give notice on behalf of each of the Lenders to
the Borrower of any Event of Default specified in this Agreement of which the
Administrative Agent has actual knowledge acquired in connection with its agency
hereunder; and (c) to distribute to each Lender copies of all notices, financial
statements and other materials delivered by the Borrower or any other Loan Party
pursuant to this Agreement or the other Loan Documents as received by the
Administrative Agent. Without limiting the generality of the foregoing, the
Agents are hereby expressly authorized to execute any and all documents
(including releases and supplements) with respect to the Collateral and the
rights of the Secured Parties with respect thereto, as contemplated by and in
accordance with the provisions of this Agreement and the Security Documents.

     Neither the Agents nor any of their respective directors, officers,
employees or agents shall be liable as such for any action taken or omitted by
any of them except for its or his own gross negligence or wilful misconduct, or
be responsible for any statement, warranty or representation herein or the
contents of any document delivered in connection herewith, or be required to
ascertain or to make any inquiry concerning the performance or observance by the
Borrower or any other Loan Party of any of the terms, conditions, covenants or
agreements contained in any Loan Document.  The Agents shall not be responsible
to the Lenders for the due execution, genuineness, validity, enforceability or
effectiveness of this Agreement or any other Loan Documents, instruments or
agreements.  The Agents shall in all cases be fully protected in acting, or
refraining from acting, in accordance with written instructions signed by the
Required Lenders and, except as otherwise specifically provided herein, such
instructions and any action or inaction pursuant thereto shall be binding on all
the Lenders.  Each Agent shall, in the absence of knowledge to the contrary, be
entitled to rely on any instrument or document believed by it in good faith to
be genuine and correct and to have been signed or sent by the proper person or
persons.  Neither the Agents nor any of their respective directors, officers,
employees or agents shall have any responsibility to the Borrower or any other
Loan Party on account of the failure of or delay in performance or breach by any
Lender or the Issuing Bank of any of its obligations hereunder or to any Lender
or the Issuing Bank on account of the failure of or delay in performance or
breach by any other Lender or the Issuing Bank or the Borrower or any other Loan
Party of any of their respective obligations hereunder or under any other Loan
Document or in connection herewith or therewith.  Each of the Agents may execute
any and all duties hereunder by or through agents or employees and shall be
entitled to rely upon the advice of legal counsel selected by it with respect to
all matters arising hereunder and shall not be liable for any action taken or
suffered in good faith by it in accordance with the advice of such counsel.

     The Lenders hereby acknowledge that neither Agent shall be under any duty
to take any discretionary action permitted to be taken by it pursuant to the
provisions of this Agreement unless it shall be requested in writing to do so by
the Required Lenders.

     Subject to the appointment and acceptance of a successor Agent as provided
below, either Agent may resign at any time upon 30 days prior notice to the
Lenders and the Borrower.  Upon any such resignation, the Required Lenders shall
have the right to appoint a successor.  If no successor shall have been so
appointed by the Required Lenders and shall have accepted such appointment
within 30 days after the retiring Agent gives notice of its resignation, then
the retiring Agent may, on behalf of the Lenders, appoint a successor Agent
which

<PAGE>

                                      -82-

shall be a bank with an office in New York, New York, having a combined capital
and surplus of at least $500,000,000 or an Affiliate of any such bank. Upon the
acceptance of any appointment as Agent hereunder by a successor bank, such
successor shall succeed to and become vested with all the rights, powers,
privileges and duties of the retiring Agent and the retiring Agent shall be
discharged from its duties and obligations hereunder. After the Agent's
resignation hereunder, the provisions of this Article and Section 9.05 shall
continue in effect for its benefit in respect of any actions taken or omitted to
be taken by it while it was acting as Agent.

     With respect to the Loans made by it hereunder, each Agent in its
individual capacity and not as Agent shall have the same rights and powers as
any other Lender and may exercise the same as though it were not an Agent, and
the Agents and their Affiliates may accept deposits from, lend money to and
generally engage in any kind of business with the Borrower or any Subsidiary or
other Affiliate thereof as if it were not an Agent.

     Each Lender agrees (a) to reimburse the Agents, on demand, in the amount of
its pro rata share (based on the aggregate amount of its outstanding Term Loans
and Revolving Credit Commitment hereunder) of any reasonable expenses incurred
for the benefit of the Lenders by the Agents, including reasonable counsel fees
and compensation of agents and employees paid for services rendered on behalf of
the Lenders, that shall not have been reimbursed by the Borrower and (b) to
indemnify and hold harmless each Agent and any of its directors, officers,
employees or agents, on demand, in the amount of such pro rata share, from and
against any and all liabilities, taxes, obligations, losses, damages, penalties,
actions, judgments, suits, costs, and reasonable expenses or disbursements of
any kind or nature whatsoever that may be imposed on, incurred by or asserted
against it in its capacity as  Agent or any of them in any way relating to or
arising out of this Agreement or any other Loan Document or any action taken or
omitted by it or any of them under this Agreement or any other Loan Document, to
the extent the same shall not have been reimbursed by the Borrower or any other
Loan Party, provided that no Lender shall be liable to an Agent or any such
other indemnified person for any portion of such liabilities, taxes,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements are determined by a court of competent jurisdiction by
final and nonappealable judgment to have resulted from the gross negligence or
wilful misconduct of such Agent or any of its directors, officers, employees or
agents.  Each Revolving Credit Lender agrees to reimburse the Issuing Bank and
its directors, employees and agents, in each case, to the same extent and
subject to the same limitations as provided above for the Agents.

     Each Lender acknowledges that it has, independently and without reliance
upon the Agents or any other Lender and based on such documents and information
as it has deemed appropriate, made its own credit analysis and decision to enter
into this Agreement.  Each Lender also acknowledges that it will, independently
and without reliance upon the Agents or any other Lender and based on such
documents and information as it shall from time to time deem appropriate,
continue to make its own decisions in taking or not taking action under or based
upon this Agreement or any other Loan Document, any related agreement or any
document furnished hereunder or thereunder.  Each of the parties hereto
acknowledge and agrees that none of the Syndication Agent or either
Documentation Agent shall have any duties, responsibilities, obligations or
liabilities, as such, hereunder or under the other Loan Documents.

<PAGE>

                                      -83-

                                   ARTICLE IX

                                 Miscellaneous

     SECTION 9.01.  Notices.  Notices and other communications provided for
herein shall be in writing and shall be delivered by hand or overnight courier
service, mailed by certified or registered mail or sent by telecopy, as follows:

          (a) if to the Borrower, to it at 6100 North Baker Road, Glendale,
     Wisconsin 53209, Attention of Andy Lampereur (Telecopy No. (414) 247-5550)
     with a copy to Quarles & Brady, 411 East Wisconsin Avenue, Milwaukee,
     Wisconsin 53202, Attention of Andrew M. Barnes (Telecopy No. (414) 271-
     3552);

          (b) if to the Administrative Agent, to Credit Suisse First Boston,
     Eleven Madison Avenue, New York, New York 10010, Attention of Agency
     Administration (Telecopy No. (212) 325-8304); and

          (c) if to a Lender, to it at its address (or telecopy number) set
     forth on Schedule 2.01 or in the Assignment and Acceptance pursuant to
     which such Lender shall have become a party hereto.

All notices and other communications given to any party hereto in accordance
with the provisions of this Agreement shall be deemed to have been given on the
date of receipt if delivered by hand or overnight courier service or sent by
telecopy or on the date five Business Days after dispatch by certified or
registered mail if mailed, in each case delivered, sent or mailed (properly
addressed) to such party as provided in this Section 9.01 or in accordance with
the latest unrevoked direction from such party given in accordance with this
Section 9.01.

     SECTION 9.02.  Survival of Agreement.  All covenants, agreements,
representations and warranties made by the Borrower herein and in the
certificates or other instruments prepared or delivered in connection with or
pursuant to this Agreement or any other Loan Document shall be considered to
have been relied upon by the Lenders and the Issuing Bank and shall survive the
making by the Lenders of the Loans and the issuance of Letters of Credit by the
Issuing Bank, regardless of any investigation made by the Lenders or the Issuing
Bank or on their behalf, and shall continue in full force and effect as long as
the principal of or any accrued interest on any Loan or any Fee or any other
amount payable under this Agreement or any other Loan Document is outstanding
and unpaid or any Letter of Credit is outstanding and so long as the Commitments
have not been terminated.  The provisions of Sections 2.14, 2.16, 2.20 and 9.05
shall remain operative and in full force and effect regardless of the expiration
of the term of this Agreement, the consummation of the transactions contemplated
hereby, the repayment of any of the Loans, the expiration of the Commitments,
the expiration of any Letter of Credit, the invalidity or unenforceability of
any term or provision of this Agreement or any other Loan Document, or any
investigation made by or on behalf of the Administrative Agent, the Collateral
Agent, any Lender or the Issuing Bank.

     SECTION 9.03.  Binding Effect.  This Agreement shall become effective
when it shall have been executed by the Borrower and the Administrative Agent
and when the Administrative Agent shall have received counterparts hereof which,
when taken together, bear the signatures of each of the other parties hereto,
and thereafter shall be binding upon and inure to the benefit of the parties
hereto and their respective permitted successors and assigns.

<PAGE>

                                      -84-

     SECTION 9.04.  Successors and Assigns. (a) Whenever in this Agreement any
of the parties hereto is referred to, such reference shall be deemed to include
the permitted successors and assigns of such party; and all covenants, promises
and agreements by or on behalf of the Borrower, the Administrative Agent, the
Issuing Bank or the Lenders that are contained in this Agreement shall bind and
inure to the benefit of their respective successors and assigns.

     (b) Each Lender may assign to one or more assignees all or a portion of its
interests, rights and obligations under this Agreement (including all or a
portion of its Commitment and the Loans at the time owing to it); provided,
however, that (i) except in the case of an assignment to a Lender or an
Affiliate or Related Fund of a Lender, (x) the Borrower and the Administrative
Agent (and, in the case of any assignment of a Revolving Credit Commitment, the
Issuing Bank and the Swingline Lender) must give their prior written consent to
such assignment (which consent shall not be unreasonably withheld); provided,
however, that the consent of the Borrower shall not be required to any such
assignment during the continuance of any Default or Event of Default and (y) the
amount of the Commitment of the assigning Lender subject to each such assignment
(determined as of the date the Assignment and Acceptance with respect to such
assignment is delivered to the Administrative Agent) shall not be less than
$2,500,000 (or in each case the Alternative Currency Equivalent thereof in the
case of an Alternative Currency Loan) (or, if less, the entire remaining amount
of such Lender's Commitment) or such lesser amount as the Borrower and the
Administrative Agent may from time to time agree (such agreement to be
conclusively evidenced by the execution of the related Assignment and
Acceptance), (ii) the parties to each such assignment shall execute and deliver
to the Administrative Agent an Assignment and Acceptance, together (except in
the case of an assignment to an Affiliate or a Related Fund) with a processing
and recordation fee of $3,500; provided that, in the case of contemporaneous
                               --------
assignments by a Lender to more than one fund managed by the same investment
advisor (which funds are not then Lenders hereunder), only a single $3,500 such
fee shall be payable for all such contemporaneous assignments and (iii) the
assignee, if it shall not be a Lender, shall deliver to the Administrative Agent
an Administrative Questionnaire and applicable tax forms.  Upon acceptance and
recording pursuant to paragraph (e) of this Section 9.04, from and after the
effective date specified in each Assignment and Acceptance, (A) the assignee
thereunder shall be a party hereto and, to the extent of the interest assigned
by such Assignment and Acceptance, have the rights and obligations of a Lender
under this Agreement and (B) the assigning Lender thereunder shall, to the
extent of the interest assigned by such Assignment and Acceptance, be released
from its obligations under this Agreement (and, in the case of an Assignment and
Acceptance covering all or the remaining portion of an assigning Lender's rights
and obligations under this Agreement, such Lender shall cease to be a party
hereto but shall continue to be entitled to the benefits of Sections 2.14, 2.16,
2.20 and 9.05, as well as to any Fees accrued for its account and not yet paid).

     (c) By executing and delivering an Assignment and Acceptance, the assigning
Lender thereunder and the assignee thereunder shall be deemed to confirm to and
agree with each other and the other parties hereto as follows:  (i) such
assigning Lender warrants that it is the legal and beneficial owner of the
interest being assigned thereby free and clear of any adverse claim and that its
Term Loan Commitment and Revolving Credit Commitment, and the outstanding
balances of its Term Loans and Revolving Loans, in each case without giving
effect to assignments thereof which have not become effective, are as set forth
in such Assignment and Acceptance, (ii) except as set forth in (i) above, such
assigning Lender makes no representation or warranty and assumes no
responsibility with respect to any statements, warranties or representations
made in or in connection with this Agreement, or the execution, legality,
validity, enforceability, genuineness, sufficiency or value of this Agreement,
any other Loan Document or any other instrument or document furnished pursuant
hereto, or the financial condition of the Borrower or any Subsidiary or the
performance or observance by the Borrower or any Subsidiary of any of its
obligations under this Agreement, any other Loan Document or any other
instrument or document furnished pursuant hereto; (iii) such assignee represents
and warrants that it is legally authorized to enter into such Assignment and
Acceptance; (iv) such assignee confirms that it has received a copy of this

<PAGE>

                                      -85-

Agreement, together with copies of the most recent financial statements referred
to in Section 3.05(a) or delivered pursuant to Section 5.04 and such other
documents and information as it has deemed appropriate to make its own credit
analysis and decision to enter into such Assignment and Acceptance; (v) such
assignee will independently and without reliance upon the Administrative Agent,
the Collateral Agent, such assigning Lender or any other Lender and based on
such documents and information as it shall deem appropriate at the time,
continue to make its own credit decisions in taking or not taking action under
this Agreement; (vi) such assignee appoints and authorizes the Administrative
Agent and the Collateral Agent to take such action as agent on its behalf and to
exercise such powers under this Agreement as are delegated to the Administrative
Agent and the Collateral Agent, respectively, by the terms hereof, together with
such powers as are reasonably incidental thereto; and (vii) such assignee agrees
that it will perform in accordance with their terms all the obligations which by
the terms of this Agreement are required to be performed by it as a Lender.

     (d) The Administrative Agent, acting for this purpose as an agent of the
Borrower, shall maintain at one of its offices in The City of New York a copy of
each Assignment and Acceptance delivered to it and a register for the
recordation of the names and addresses of the Lenders, and the Commitment of,
and principal amount of the Loans owing to, each Lender pursuant to the terms
hereof from time to time (the "Register").  The entries in the Register shall be
conclusive and the Borrower, the Administrative Agent, the Issuing Bank, the
Collateral Agent and the Lenders may treat each person whose name is recorded in
the Register pursuant to the terms hereof as a Lender hereunder for all purposes
of this Agreement, notwithstanding notice to the contrary.  The Register shall
be available for inspection by the Borrower, the Issuing Bank, the Collateral
Agent and any Lender, at any reasonable time and from time to time upon
reasonable prior notice.

     (e) Upon its receipt of a duly completed Assignment and Acceptance executed
by an assigning Lender and an assignee, an Administrative Questionnaire and
appropriate tax forms completed in respect of the assignee (unless the assignee
shall already be a Lender hereunder), the processing and recordation fee
referred to in paragraph (b) above and, if required, the written consent of the
Borrower, the Swingline Lender, the Issuing Bank and the Administrative Agent to
such assignment, the Administrative Agent shall (i) accept such Assignment and
Acceptance, (ii) record the information contained therein in the Register and
(iii) give prompt notice thereof to the Lenders, the Swingline Lender and the
Issuing Bank.  No assignment shall be effective unless it has been recorded in
the Register as provided in this paragraph (e).

     (f) Each Lender may without the consent of the Borrower, the Swingline
Lender, the Issuing Bank or the Administrative Agent sell participations to one
or more banks or other entities in all or a portion of its rights and
obligations under this Agreement (including all or a portion of its Commitment
and the Loans owing to it); provided, however, that (i) such Lender's
obligations under this Agreement shall remain unchanged, (ii) such Lender shall
remain solely responsible to the other parties hereto for the performance of
such obligations, (iii) the participating banks or other entities shall be
entitled to the benefit of the cost protection provisions contained in Sections
2.14, 2.16 and 2.20 to the same extent as if they were Lenders and (iv) the
Borrower, the Administrative Agent, the Issuing Bank and the Lenders shall
continue to deal solely and directly with such Lender in connection with such
Lender's rights and obligations under this Agreement, and such Lender shall
retain the sole right to enforce the obligations of the Borrower relating to the
Loans or L/C Disbursements and to approve any amendment, modification or waiver
of any provision of this Agreement (other than amendments, modifications or
waivers decreasing any fees payable hereunder or the amount of principal of or
the rate at which interest is payable on the Loans, extending any scheduled
principal payment date or date fixed for the payment of interest on the Loans,
increasing or extending the Commitments or releasing any Subsidiary Guarantor or
all or any substantial part of the Collateral).

<PAGE>

                                      -86-

     (g) Any Lender or participant may, in connection with any assignment or
participation or proposed assignment or participation pursuant to this Section
9.04, disclose to the assignee or participant or proposed assignee or
participant any information relating to the Borrower furnished to such Lender by
or on behalf of the Borrower; provided that, prior to any such disclosure of
information designated by the Borrower as confidential, each such assignee or
participant or proposed assignee or participant shall execute an agreement
whereby such assignee or participant shall agree (subject to customary
exceptions) to preserve the confidentiality of such confidential information on
terms no less restrictive than those applicable to the Lenders pursuant to
Section 9.17.

     (h) Any Lender may at any time pledge or assign all or any portion of its
rights under this Agreement to secure extensions of credit to such Lender or in
support of obligations owed by such Lender; provided that no such assignment
shall release a Lender from any of its obligations hereunder or substitute any
such assignee for such Lender as a party hereto.

     (i) Notwithstanding anything to the contrary contained herein, any Lender
(a "Granting Lender") may grant to a special purpose funding vehicle (an "SPC"),
identified as such in writing from time to time by the Granting Lender to the
Administrative Agent and the Borrower, the option to provide to the Borrower all
or any part of any Loan that such Granting Lender would otherwise be obligated
to make to the Borrower pursuant to this Agreement; provided that (i) nothing
herein shall constitute a commitment by any SPC to make any Loan and (ii) if an
SPC elects not to exercise such option or otherwise fails to provide all or any
part of such Loan, the Granting Lender shall be obligated to make such Loan
pursuant to the terms hereof.  The making of a Loan by an SPC hereunder shall
utilize the Commitment of the Granting Lender to the same extent, and as if,
such Loan were made by such Granting Lender.  Each party hereto hereby agrees
that no SPC shall be liable for any indemnity or similar payment obligation
under this Agreement (all liability for which shall remain with the Granting
Lender).  In furtherance of the foregoing, each party hereto hereby agrees
(which agreement shall survive the termination of this Agreement) that, prior to
the date that is one year and one day after the payment in full of all
outstanding commercial paper or other senior indebtedness of any SPC, it will
not institute against, or join any other person in instituting against, such SPC
any bankruptcy, reorganization, arrangement, insolvency or liquidation
proceedings under the laws of the United States or any State thereof.  In
addition, notwithstanding anything to the contrary contained in this Section
9.04, any SPC may (i) with notice to, but without the prior written consent of,
the Borrower and the Administrative Agent and without paying any processing fee
therefore, assign all or a portion of its interests in any Loans to the Granting
Lender or to any financial institutions (consented to by the Borrower and
Administrative Agent) providing liquidity and/or credit support to or for the
account of such SPC to support the funding or maintenance of Loans and (ii)
disclose on a confidential basis any non-public information relating to its
Loans to any rating agency, commercial paper dealer or provider of any surety,
guarantee or credit or liquidity enhancement to such SPC.

     (j) The Borrower shall not assign or delegate any of its rights or duties
hereunder without the prior written consent of the Administrative Agent, the
Issuing Bank and each Lender, and any attempted assignment without such consent
shall be null and void.

     (k) In the event that Standard & Poor's Ratings Group, Moody's Investors
Service, Inc., and Thompson's BankWatch (or Insurance Watch Ratings Service, in
the case of Lenders that are insurance companies (or Best's Insurance Reports,
if such insurance company is not rated by Insurance Watch Ratings Service))
shall, after the date that any Lender becomes a Revolving Credit Lender,
downgrade the long-term certificate deposit ratings of such Lender, and the
resulting ratings shall be below BBB-, Baa3 and C (or BB, in the case of a
Lender that is an insurance company (or B, in the case of an insurance company
not rated by Insurance Watch Ratings Service)), then the Issuing Bank shall have
the right, but not the obligation, at its own expense, upon

<PAGE>

                                      -87-

notice to such Lender and the Administrative Agent, to replace (or to request
the Borrower to use its reasonable efforts to replace) such Lender with an
assignee (in accordance with and subject to the restrictions contained in
paragraph (b) above), and such Lender hereby agrees to transfer and assign
without recourse (in accordance with and subject to the restrictions contained
in paragraph (b) above) all its interests, rights and obligations in respect of
its Revolving Credit Commitment to such assignee; provided, however, that (i) no
such assignment shall conflict with any law, rule and regulation or order of any
Governmental Authority and (ii) the Issuing Bank or such assignee, as the case
may be, shall pay to such Lender in immediately available funds on the date of
such assignment the principal of and interest accrued to the date of payment on
the Loans made by such Lender hereunder and all other amounts accrued for such
Lender's account or owed to it hereunder.

     SECTION 9.05.  Expenses; Indemnity.  (a)  The Borrower agrees to pay all
out-of-pocket expenses incurred by the Administrative Agent, the Collateral
Agent, the Swingline Lender and the Issuing Bank in connection with the
syndication of the credit facilities provided for herein and the preparation and
administration of this Agreement and the other Loan Documents or in connection
with any amendments, modifications or waivers of the provisions hereof or
thereof (whether or not the transactions hereby or thereby contemplated shall be
consummated) or incurred by the Administrative Agent, the Collateral Agent or
any Lender in connection with the enforcement or protection of its rights in
connection with this Agreement and the other Loan Documents or in connection
with the Loans made or Letters of Credit issued hereunder, including the
reasonable fees, charges and disbursements of Cahill Gordon & Reindel, counsel
for the Administrative Agent and the Collateral Agent, and, in connection with
any such enforcement or protection, the reasonable fees, charges and
disbursements of any other counsel for the Administrative Agent, the Collateral
Agent or any Lender.

     (b) The Borrower agrees to indemnify the Administrative Agent, the
Collateral Agent, each Lender and the Issuing Bank, each Affiliate of any of the
foregoing persons and each of their respective directors, officers, trustees,
employees and agents (each such person being called an "Indemnitee") against,
and to hold each Indemnitee harmless from, any and all losses, claims, damages,
liabilities and related expenses, including reasonable counsel fees, charges and
disbursements, incurred by or asserted against any Indemnitee arising out of, in
any way connected with, or as a result of (i) the execution or delivery of this
Agreement or any other Loan Document or any agreement or instrument contemplated
thereby, the performance by the parties thereto of their respective obligations
thereunder or the consummation of the Transactions and the other transactions
contemplated thereby, (ii) the use of the proceeds of the Loans or issuance of
Letters of Credit, (iii) any claim, litigation, investigation or proceeding
relating to any of the foregoing, whether or not any Indemnitee is a party
thereto, or (iv) any actual or alleged presence or Release of Hazardous
Materials on any property owned or operated by the Borrower or any of the
Subsidiaries, or any Environmental Claim related in any way to the Borrower or
the Subsidiaries; provided that such indemnity shall not, as to any Indemnitee,
be available to the extent that such losses, claims, damages, liabilities or
related expenses are determined by a court of competent jurisdiction by final
and nonappealable judgment to have resulted from the bad faith, gross negligence
or wilful misconduct of such Indemnitee.

     (c) The provisions of this Section 9.05 shall remain operative and in full
force and effect regardless of the expiration of the term of this Agreement, the
consummation of the transactions contemplated hereby, the repayment of any of
the Loans, the expiration of the Commitments, the expiration of any Letter of
Credit, the invalidity or unenforceability of any term or provision of this
Agreement or any other Loan Document, or any investigation made by or on behalf
of the Administrative Agent, the Collateral Agent, any Lender or the Issuing
Bank.  All amounts due under this Section 9.05 shall be payable on written
demand therefor accompanied by reasonable documentation with respect to any
reimbursement, indemnification or other amount requested.

<PAGE>

                                      -88-

     SECTION 9.06.  Right of Setoff. If an Event of Default shall have occurred
and be continuing, each Lender is hereby authorized at any time and from time to
time, except to the extent prohibited by law, to set off and apply any and all
deposits (general or special, time or demand, provisional or final) at any time
held and other indebtedness at any time owing by such Lender to or for the
credit or the account of the Borrower against any of and all the obligations of
the Borrower now or hereafter existing under this Agreement and other Loan
Documents held by such Lender, irrespective of whether or not such Lender shall
have made any demand under this Agreement or such other Loan Document and
although such obligations may be unmatured. Each Lender is authorized to convert
any such amounts of deposits or indebtedness into a currency other than the one
in which it is otherwise denominated in order to effect the setoff of a given
deposit or other indebtedness in one currency against an obligation of the
Borrower in another currency. The rights of each Lender under this Section 9.06
are in addition to other rights and remedies (including other rights of setoff)
which such Lender may have.

     SECTION 9.07.  Applicable Law. THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS
(OTHER THAN LETTERS OF CREDIT AND AS EXPRESSLY SET FORTH IN OTHER LOAN
DOCUMENTS) SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE
STATE OF NEW YORK. EACH LETTER OF CREDIT SHALL BE GOVERNED BY, AND SHALL BE
CONSTRUED IN ACCORDANCE WITH, THE LAWS OR RULES DESIGNATED IN SUCH LETTER OF
CREDIT, OR IF NO SUCH LAWS OR RULES ARE DESIGNATED, THE UNIFORM CUSTOMS AND
PRACTICE FOR DOCUMENTARY CREDITS (1993 REVISION), INTERNATIONAL CHAMBER OF
COMMERCE, PUBLICATION NO. 500 (THE "UNIFORM CUSTOMS") AND, AS TO MATTERS NOT
GOVERNED BY THE UNIFORM CUSTOMS, THE LAWS OF THE STATE OF NEW YORK.

     SECTION 9.08.  Waivers; Amendment.  (a)  No failure or delay of the
Administrative Agent, the Collateral Agent, any Lender or the Issuing Bank in
exercising any power or right hereunder or under any other Loan Document shall
operate as a waiver thereof, nor shall any single or partial exercise of any
such right or power, or any abandonment or discontinuance of steps to enforce
such a right or power, preclude any other or further exercise thereof or the
exercise of any other right or power.  The rights and remedies of the
Administrative Agent, the Collateral Agent, the Issuing Bank and the Lenders
hereunder and under the other Loan Documents are cumulative and are not
exclusive of any rights or remedies that they would otherwise have.  No waiver
of any provision of this Agreement or any other Loan Document or consent to any
departure by the Borrower or any other Loan Party therefrom shall in any event
be effective unless the same shall be permitted by paragraph (b) below, and then
such waiver or consent shall be effective only in the specific instance and for
the purpose for which given.  No notice or demand on the Borrower in any case
shall entitle the Borrower to any other or further notice or demand in similar
or other circumstances.

     (b) Neither this Agreement nor any provision hereof may be waived, amended
or modified except pursuant to an agreement or agreements in writing entered
into by the Borrower and the Required Lenders; provided, however, that no such
agreement shall (i) change any scheduled principal payment date or amount or
date for the payment of any interest on any Loan or any date for reimbursement
of an L/C Disbursement, or waive or excuse any such payment or any part thereof,
or decrease the rate of interest on any Loan or L/C Disbursement, without the
prior written consent of each Lender affected thereby, (ii) change or extend the
Commitment or decrease or extend the date for payment of the Fees of any Lender
or any other amounts payable hereunder to any Lender without the prior written
consent of such Lender, (iii) amend or modify the pro rata requirements of
Section 2.17, the provisions of Section 9.04(j), the provisions of this Section
9.08, the definition of the term "Required Lenders" or release any Subsidiary
Guarantor (other than in connection with a transaction permitted hereunder) or
all or any substantial part of the Collateral, without the prior written consent
of each Lender, (iv) change the provisions of any Loan Document in a manner that
by its terms adversely affects the rights in respect of payments due to Lenders
holding Tranche A Term Loans, Tranche B Term Loans, Tranche C

<PAGE>

                                      -89-

Term Loans, if any, or Revolving Loans (as used in this Section, each a "Class"
of Loans) differently from the rights in respect of payments due to Lenders
holding any other Class of Loans without the prior written consent of Lenders
holding a majority of the aggregate outstanding principal amount of the Loans
(or, if no Revolving Loans are outstanding, the Revolving Commitments) of the
adversely affected Class of Loans, (v) change the rights of the Lenders holding
Tranche B Term Loans to reject prepayments under Section 2.12(b) and Section
2.13(j) without the prior written consent of the Lenders holding a majority of
the aggregate outstanding principal amount of the Tranche B Term Loans or (vi)
amend or modify the protections afforded to an SPC pursuant to the provisions of
Section 9.04(i) without the written consent of such SPC; provided further that
no such agreement shall amend, modify or otherwise affect the rights or duties
of the Administrative Agent, the Collateral Agent, the Issuing Bank or the
Swingline Lender hereunder or under any other Loan Document without the prior
written consent of the Administrative Agent, the Collateral Agent, the Issuing
Bank or the Swingline Lender, respectively.

     Notwithstanding the foregoing, any technical amendments or modifications to
this Agreement required to give effect to the issuance of the Tranche C Term
Loan Commitment or the Tranche C Term Loans in accordance with Section 2.25
shall only require the consent of the Administrative Agent, the Tranche C Term
Loan Lenders and the Borrower.

     SECTION 9.09.  Interest Rate Limitation.  Notwithstanding anything herein
to the contrary, if at any time the interest rate applicable to any Loan or
participation in any L/C Disbursement, together with all fees, charges and other
amounts which are treated as interest on such Loan or participation in such L/C
Disbursement under applicable law (collectively the "Charges"), shall exceed the
maximum lawful rate (the "Maximum Rate") which may be contracted for, charged,
taken, received or reserved by the Lender holding such Loan or participation in
accordance with applicable law, the rate of interest payable in respect of such
Loan or participation hereunder, together with all Charges payable in respect
thereof, shall be limited to the Maximum Rate and, to the extent lawful, the
interest and Charges that would have been payable in respect of such Loan or
participation but were not payable as a result of the operation of this Section
9.09 shall be cumulated and the interest and Charges payable to such Lender in
respect of other Loans or participations or periods shall be increased (but not
above the Maximum Rate therefor) until such cumulated amount, together with
interest thereon at the Federal Funds Effective Rate to the date of repayment,
shall have been received by such Lender.

     SECTION 9.10.  Entire Agreement.  This Agreement, the Fee Letter and the
other Loan Documents constitute the entire contract between the parties relative
to the subject matter hereof.  Any other previous agreement among the parties
with respect to the subject matter hereof is superseded by this Agreement and
the other Loan Documents.  Nothing in this Agreement or in the other Loan
Documents, expressed or implied, is intended to confer upon any party other than
the parties hereto and thereto any rights, remedies, obligations or liabilities
under or by reason of this Agreement or the other Loan Documents.

     SECTION 9.11.   WAIVER OF JURY TRIAL.  EACH PARTY HERETO HEREBY WAIVES,
TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A
TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT
OF, UNDER OR IN CONNECTION WITH THIS AGREEMENT OR ANY OF THE OTHER LOAN
DOCUMENTS.  EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR
ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH
OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING
WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN
INDUCED TO ENTER INTO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS, AS
APPLICABLE, BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN
THIS SECTION 9.11.

<PAGE>

                                      -90-

     SECTION 9.12.  Severability.  In the event any one or more of the
provisions contained in this Agreement or in any other Loan Document should be
held invalid, illegal or unenforceable in any respect, the validity, legality
and enforceability of the remaining provisions contained herein and therein
shall not in any way be affected or impaired thereby (it being understood that
the invalidity of a particular provision in a particular jurisdiction shall not
in and of itself affect the validity of such provision in any other
jurisdiction).  The parties shall endeavor in good-faith negotiations to replace
the invalid, illegal or unenforceable provisions with valid provisions the
economic effect of which comes as close as possible to that of the invalid,
illegal or unenforceable provisions.

     SECTION 9.13.  Counterparts. This Agreement may be executed in counterparts
(and by different parties hereto on different counterparts), each of which shall
constitute an original but all of which when taken together shall constitute a
single contract, and shall become effective as provided in Section 9.03.
Delivery of an executed signature page to this Agreement by facsimile
transmission shall be as effective as delivery of a manually signed counterpart
of this Agreement.

     SECTION 9.14.  Headings. Article and Section headings and the Table of
Contents used herein are for convenience of reference only, are not part of this
Agreement and are not to affect the construction of, or to be taken into
consideration in interpreting, this Agreement.

     SECTION 9.15.  Jurisdiction; Consent to Service of Process.  (a)  Each of
the Borrower, the Administrative Agent, the Collateral Agent, the Issuing Bank
and each Lender hereby irrevocably and unconditionally submits, for itself and
its property, to the nonexclusive jurisdiction of any New York State court or
Federal court of the United States of America sitting in New York City, and any
appellate court from any thereof, in any action or proceeding arising out of or
relating to this Agreement or the other Loan Documents, or for recognition or
enforcement of any judgment, and each of the parties hereto hereby irrevocably
and unconditionally agrees that all claims in respect of any such action or
proceeding may be heard and determined in such New York State or, to the extent
permitted by law, in such Federal court.  Each of the parties hereto agrees that
a final judgment in any such action or proceeding shall be conclusive and may be
enforced in other jurisdictions by suit on the judgment or in any other manner
provided by law.  Nothing in this Agreement shall affect any right that any
party may otherwise have to bring any action or proceeding relating to this
Agreement or the other Loan Documents against any other party or its properties
in the courts of any jurisdiction.

     (b) Each of the Borrower, the Administrative Agent, the Issuing Bank and
the Lenders hereby irrevocably and unconditionally waives, to the fullest extent
it may legally and effectively do so, any objection which it may now or
hereafter have to the laying of venue of any suit, action or proceeding arising
out of or relating to this Agreement or the other Loan Documents in any New York
State or Federal court.  Each of the parties hereto hereby irrevocably waives,
to the fullest extent permitted by law, the defense of an inconvenient forum to
the maintenance of such action or proceeding in any such court.

     (c) Each party to this Agreement irrevocably consents to service of process
in the manner provided for notices in Section 9.01.  Nothing in this Agreement
will affect the right of any party to this Agreement to serve process in any
other manner permitted by law.

     SECTION 9.16.  Judgment Currency.  (a)  If for the purpose of obtaining
judgment in any court it is necessary to convert a sum due hereunder in one
currency into another currency, the parties hereto agree, to the fullest extent
that they may lawfully do so, that the rate of exchange used shall be that at
which in accordance with normal banking procedures the Administrative Agent
could purchase the first currency with such other cur-

<PAGE>

                                      -91-

rency in the city in which it normally conducts its foreign exchange operation
for the first currency on the Business Day preceding the day on which final
judgment is given.

     (b) The obligation of each Borrower in respect of any sum due from it to
any Lender hereunder shall, notwithstanding any judgment in a currency (the
"Judgment Currency") other than that in which such sum is denominated in
accordance with the applicable provisions of this Agreement (the "Agreement
Currency"), be discharged only to the extent that on the Business Day following
receipt by such Lender of any sum adjudged to be so due in the Judgment Currency
such Lender may in accordance with the normal banking procedures purchase the
Agreement Currency with the Judgment Currency; if the amount of Agreement
Currency so purchased is less than the sum originally due to such Lender in the
Agreement Currency, such Borrower agrees notwithstanding any such judgment to
indemnify such Lender against such loss, and if the amount of the Agreement
Currency so purchased exceeds the sum originally due to any Lender, such Lender
agrees to remit to such Borrower such excess.

     (c) For purposes of determining the rate of exchange for this Section, such
amounts shall include any premium and costs payable in connection with the
purchase of the Obligation Currency.

     SECTION 9.17.  Confidentiality.  The Administrative Agent, the Collateral
Agent, the Issuing Bank and each of the Lenders agrees to keep confidential (and
to use its best efforts to cause its respective agents and representatives to
keep confidential) the Information (as defined below) and all copies thereof,
extracts therefrom and analyses or other materials based thereon, except that
the Administrative Agent, the Collateral Agent, the Issuing Bank or any Lender
shall be permitted to disclose Information (a) to such of its respective
officers, directors, employees, agents, affiliates and representatives as need
to know such Information, (b) to a potential assignee or participant of such
Lender or any direct or indirect contractual counterparty in any swap agreement
relating to the Loans or such potential assignee's or participant's or
counterparty's advisors who need to know such Information (provided that any
such potential assignee or participant or counterparty shall, and shall use its
best efforts to cause its advisors to, keep confidential all such information on
the terms set forth in this Section 9.17, (c) to the extent requested by any
examiner or regulatory authority, (d) to the extent otherwise required by
applicable laws and regulations or by any subpoena or similar legal process, (e)
in connection with any suit, action or proceeding relating to the enforcement of
its rights hereunder or under the other Loan Documents or (f) to the extent such
Information (i) becomes publicly available other than as a result of a breach of
this Section 9.17 or (ii) becomes available to the Administrative Agent, the
Issuing Bank, any Lender or the Collateral Agent on a nonconfidential basis from
a source other than the Borrower.  For the purposes of this Section,
"Information" shall mean all financial statements, certificates, reports,
agreements and information (including all analyses, compilations and studies
prepared by the Administrative Agent, the Collateral Agent, the Issuing Bank or
any Lender based on any of the foregoing) that are received from the Borrower
and related to the Borrower, any shareholder of the Borrower or any employee,
customer or supplier of the Borrower, other than any of the foregoing that were
available to the Administrative Agent, the Collateral Agent, the Issuing Bank or
any Lender on a nonconfidential basis prior to its disclosure thereto by the
Borrower, and which are in the case of Information provided after the date
hereof, clearly identified at the time of delivery as confidential.  The
provisions of this Section 9.17 shall remain operative and in full force and
effect regardless of the expiration and term of this Agreement.

<PAGE>

                                      S-1

     IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their respective authorized officers as of the day and year
first above written.

                                  APPLIED POWER, INC.,
                                  (doing business as Actuant Corporation)

                                  by   /s/
                                      --------------------------------
                                      Name:
                                      Title:

                                  CREDIT SUISSE FIRST BOSTON, individually, and
                                    as Administrative Agent, Collateral Agent,
                                    Swingline Lender and an Issuing Bank,

                                  by   /s/
                                      --------------------------------
                                      Name:
                                      Title:

                                  by   /s/
                                      --------------------------------
                                      Name:
                                      Title:

                                  FIRST UNION NATIONAL BANK, individually, and
                                    as Syndication Agent,

                                  by   /s/
                                      --------------------------------
                                      Name:
                                      Title:

                                  ING (U.S.) CAPITAL LLC, individually, and as
                                    Documentation Agent,

                                  by   /s/
                                      --------------------------------
                                      Name:
                                      Title:<PAGE>

<TABLE>
<CAPTION>
 ==================================================================================================================================
                                  Term Loan & Revolving Credit Mortgage,
                                 Assignment of Leases and Rents,
                                   Security Agreement and Fixture Filing

         Document No.                         Document Title

========================================================================
<S>                                                                     <C>

                                      BY

                          APW Tools & Supplies, Inc.

                                  Mortgagor,

                                      TO

                          CREDIT SUISSE FIRST BOSTON,
                             as Collateral Agent,

                                   Mortgagee

                Securing Principal Indebtedness of $430,000,000

                           Dated as of July 31, 2000

                            Relating to Premises in                     Recording Area

                          Milwaukee County, Wisconsin                ===============================================================
                                                                        This instrument prepared by and, after recording, please
                                                                        return to:

                                                                        Athy A. Mobilia, Esq.
                                                                        Cahill Gordon & Reindel
                                                                        80 Pine Street
                                                                        New York, New York  10005

                                                                     ===============================================================
                                                                        See Exhibit A
                                                                     ---------------------------------------------------------------

                                                                        Parcel Identification Number (PIN)   160-9013-000
====================================================================================================================================
</TABLE>

<PAGE>

                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                                                          Page
                                                                                                          ----
<S>                                                                                                       <C>
PREAMBLE.................................................................................................    1

RECITALS.................................................................................................    1

AGREEMENT................................................................................................    2

                                                           ARTICLE I

                                                 DEFINITIONS AND INTERPRETATION

SECTION 1.1         Definitions..........................................................................    2
SECTION 1.2         Interpretation.......................................................................    9
SECTION 1.3         Resolution of Drafting Ambiguities...................................................   10

                                                           ARTICLE II

                                                 GRANTS AND SECURED OBLIGATIONS

SECTION 2.1         Grant of Mortgaged Property..........................................................   10
SECTION 2.2         Assignment of Leases and Rents.......................................................   11
SECTION 2.3         Secured Obligations..................................................................   11
SECTION 2.4         Future Advances......................................................................   11
SECTION 2.5         No Release...........................................................................   11

                                                           ARTICLE III

                                            REPRESENTATIONS AND WARRANTIES OF MORTGAGOR

SECTION 3.1         Authority and Validity...............................................................   12
SECTION 3.2         Warranty of Title....................................................................   12
SECTION 3.3         Condition of Mortgaged Property......................................................   13
SECTION 3.4         Leases...............................................................................   14
SECTION 3.5         Insurance............................................................................   15
SECTION 3.6         Charges..............................................................................   15
SECTION 3.7         Environmental........................................................................   15
SECTION 3.8         No Conflicts, Consents, etc..........................................................   16

                                                           ARTICLE IV

                                                 CERTAIN COVENANTS OF MORTGAGOR

SECTION 4.1         Payment..............................................................................   16
SECTION 4.2         Preservation of Corporate Existence..................................................   16
</TABLE>

                                      -i-
<PAGE>

<TABLE>
<CAPTION>
                                                                                                          Page
                                                                                                          ----
<S>                 <C>                                                                                   <C>
SECTION 4.3         Title................................................................................   17
SECTION 4.4         Maintenance and Use of Mortgaged Property; Alterations...............................   17
SECTION 4.5         Notices Regarding Certain Defaults...................................................   18
SECTION 4.6         Access to Mortgaged Property, Books and Records; Other Information...................   18
SECTION 4.7         Limitation on Liens; Transfer Restrictions...........................................   19
SECTION 4.8         Environmental........................................................................   19
SECTION 4.9         Estoppel Certificates................................................................   20

                                                           ARTICLE V

                                                            LEASES

SECTION 5.1         Mortgagor's Affirmative Covenants with Respect to Leases.............................   20
SECTION 5.2         Mortgagor's Negative Covenants with Respect to Leases................................   20
SECTION 5.3         Additional Requirements with Respect to New Leases...................................   22

                                                           ARTICLE VI

                                          CONCERNING ASSIGNMENT OF LEASES AND RENTS

SECTION 6.1         License to the Mortgagor.............................................................   22
SECTION 6.2         Collection of Rents by the Mortgagee.................................................   22
SECTION 6.3         No Release...........................................................................   22
SECTION 6.4         Irrevocable Interest.................................................................   22
SECTION 6.5         Amendment to Leases..................................................................   23

                                                           ARTICLE VII

                                               TAXES AND CERTAIN STATUTORY LIENS

SECTION 7.1         Payment of Charges...................................................................   23
SECTION 7.2         Escrow of Taxes......................................................................   23
SECTION 7.3         Certain Statutory Liens..............................................................   23
SECTION 7.4         Stamp and Other Taxes................................................................   24
SECTION 7.5         Certain Tax Law Changes..............................................................   24
SECTION 7.6         Proceeds of Tax Claim................................................................   24

                                                           ARTICLE VIII

                                                            INSURANCE

SECTION 8.1         Required Insurance Policies and Coverages............................................   24
SECTION 8.2         Required Form of Insurance Policies..................................................   25
SECTION 8.3         Settlements..........................................................................   26
SECTION 8.4         Renewals.............................................................................   26
SECTION 8.5         Additional Insurance.................................................................   26
SECTION 8.6         Blanket Coverage.....................................................................   26
SECTION 8.7         Delivery After Foreclosure...........................................................   26
</TABLE>

                                      -ii-
<PAGE>

<TABLE>
<CAPTION>
                                                                                                          Page
                                                                                                          ----

                                                           ARTICLE IX

                                                     CONTESTING OF PAYMENTS
<S>                 <C>                                                                                   <C>
SECTION 9.1         Contesting of Taxes and Certain Statutory Liens......................................   26
SECTION 9.2         Contesting of Insurance..............................................................   27

                                                           ARTICLE X

                                             DESTRUCTION, CONDEMNATION AND RESTORATION

SECTION 10.1        Destruction..........................................................................   27
SECTION 10.2        Condemnation.........................................................................   27
SECTION 10.3        Restoration..........................................................................   28
SECTION 10.4        Major Restoration....................................................................   28
SECTION 10.5        Restoration Advances Following Destruction or Taking of Mortgaged Property...........   29

                                                           ARTICLE XI

                                                 EVENTS OF DEFAULT AND REMEDIES

SECTION 11.1        Events of Default....................................................................   30
SECTION 11.2        Remedies in Case of an Event of Default..............................................   30
SECTION 11.3        Sale of Mortgaged Property if Event of Default Occurs; Proceeds of Sale..............   32
SECTION 11.4        Additional Remedies in Case of an Event of Default...................................   33
SECTION 11.5        Legal Proceedings After an Event of Default..........................................   34
SECTION 11.6        Remedies Not Exclusive...............................................................   35

                                                           ARTICLE XII

                                             SECURITY AGREEMENT AND FIXTURE FILING

SECTION 12.1        Security Agreement...................................................................   35
SECTION 12.2        Fixture Filing.......................................................................   36

                                                           ARTICLE XIII

                                                        FURTHER ASSURANCES

SECTION 13.1        Recording Documentation To Assure Security...........................................   36
SECTION 13.2        Further Acts.........................................................................   36
SECTION 13.3        Additional Security..................................................................   37
</TABLE>

                                     -iii-
<PAGE>

<TABLE>
<CAPTION>
                                                                                                          Page
                                                                                                          ----

                                                           ARTICLE XIV

                                                          MISCELLANEOUS
<S>                 <C>                                                                                   <C>
SECTION 14.1        Covenants To Run with the Land.......................................................   37
SECTION 14.2        No Merger............................................................................   37
SECTION 14.3        Concerning Mortgagee.................................................................   37
SECTION 14.4        Mortgagee May Perform; Mortgagee Appointed Attorney-in-Fact..........................   38
SECTION 14.5        Expenses.............................................................................   39
SECTION 14.6        Indemnity............................................................................   39
SECTION 14.7        Continuing Security Interest; Assignment.............................................   40
SECTION 14.8        Termination; Release.................................................................   40
SECTION 14.9        Modification in Writing..............................................................   40
SECTION 14.10       Notices..............................................................................   40
SECTION 14.11       GOVERNING LAW; SERVICE OF PROCESS; WAIVER OF JURY TRIAL..............................   41
SECTION 14.12       Severability of Provisions...........................................................   41
SECTION 14.13       Limitation on Interest Payable.......................................................   41
SECTION 14.14       Business Days........................................................................   42
SECTION 14.15       Relationship.........................................................................   42
SECTION 14.16       Waiver of Stay.......................................................................   42
SECTION 14.17       No Credit for Payment of Taxes or Impositions........................................   42
SECTION 14.18       No Claims Against the Mortgagee......................................................   43
SECTION 14.19       Obligations Absolute.................................................................   43
SECTION 14.20       Mortgagee's Right To Sever Indebtedness..............................................   43
SECTION 14.21       Shortened Redemption Election .......................................................   44

SIGNATURE

ACKNOWLEDGMENTS

SCHEDULE A            Legal Description
SCHEDULE B            Prior Liens

EXHIBIT 1             Form of Subordination, Non-Disturbance and
                      Attornment Agreement
</TABLE>

                                      -iv-
<PAGE>

                        TERM LOAN AND REVOLVING CREDIT

              MORTGAGE, ASSIGNMENT OF LEASES AND RENTS, SECURITY

                         AGREEMENT AND FIXTURE FILING

          TERM LOAN AND REVOLVING CREDIT MORTGAGE, ASSIGNMENT OF LEASES AND
RENTS, SECURITY AGREEMENT AND FIXTURE FILING (the "Mortgage"), dated as of July
                                                   --------
31, 2000, made by APW Tools & Supplies, Inc., a Wisconsin corporation having an
office at 6101 North Baker Road, Glendale, WI, as mortgagor, assignor and debtor
(in such capacities and together with any successors in such capacities, the
"Mortgagor"), in favor of CREDIT SUISSE FIRST BOSTON, a bank organized under the
 ---------
laws of Switzerland, acting through its New York branch ("CSFB"), having an
office at Eleven Madison Avenue, New York, New York 10010, in its capacity as
collateral agent for the lending institutions (the "Lenders") from time to time
                                                    -------
party to the Credit Agreement (as hereinafter defined), as mortgagee, assignee
and secured party (CSFB, in such capacities and together with any successors in
such capacities, the "Mortgagee").
                      ---------

                               R E C I T A L S :
                               - - - - - - - -

          A.   Pursuant to that certain credit agreement, dated as of July 31,
2000 (as amended, amended and restated, supplemented or otherwise modified from
time to time, the "Credit Agreement"), among Applied Power Inc. (doing business
                   ----------------
as Actuant Corporation), a Wisconsin corporation (the "Borrower"), the Lenders,
                                                       --------
CSFB, as swingline lender, an issuing bank, administrative agent and Collateral
Agent, First Union National Bank, as syndication agent and ING (U.S.) Capital
LLC, as documentation agent, the Lenders have agreed to make to or for the
account of the Borrower certain Loans (as hereinafter defined) and to issue
certain Letters of Credit (as hereinafter defined) for the account of the
Borrower.

          B.   It is contemplated that the Borrower and one or more of the
Subsidiary Guarantors may enter into one or more agreements (collectively, the
"Interest Rate Protection Agreements") with one or more of the Lenders or their
 -----------------------------------
respective Affiliates (as hereinafter defined) fixing the interest rates with
respect to the Loans under the Credit Agreement.

          C.   The Borrower owns, directly or through its Subsidiaries (as
hereinafter defined), all of the issued and outstanding shares of the Mortgagor.

          D.   The Mortgagor has, pursuant to a certain subsidiary guarantee
agreement, dated as of July 31, 2000, among other things, guaranteed (the
"Subsidiary Guarantee") the obligations of the Borrower under the Credit
 --------------------
Agreement and the other Loan Documents (as hereinafter defined).

          E.   The Mortgagor will receive substantial benefits from the
execution, delivery and performance of the Loan Documents and is, therefore,
willing to enter into this Mortgage.

          F.   The Mortgagor is or will be the legal owner of the Mortgaged
Property (as hereinafter defined).

          G.   It is a condition to the obligations of the Lenders to make the
Loans under the Credit Agreement and a condition to any Lender issuing Letters
of Credit under the Credit Agreement or entering
<PAGE>

                                      -2-

into any Interest Rate Protection Agreement that the Mortgagor execute and
deliver the applicable Loan Documents (as hereinafter defined), including this
Mortgage.

          H.   This Mortgage is given by the Mortgagor in favor of the Mortgagee
for its benefit and the benefit of the Lenders (collectively, the "Secured
                                                                   -------
Parties") to secure the payment and performance of all of the Secured
-------
Obligations (as hereinafter defined).

                              A G R E E M E N T:
                              - - - - - - - - -

          NOW THEREFORE, in consideration of the foregoing premises and other
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the Mortgagor hereby covenants and agrees with the Mortgagee as
follows:

                                   ARTICLE I

                        DEFINITIONS AND INTERPRETATION

          SECTION 1.1  Definitions.  Capitalized terms used but not otherwise
                       -----------
defined herein shall have the meanings assigned to such terms in the Credit
Agreement. The following terms used in this Mortgage shall have the following
meanings:

          "ACM" shall have the meaning assigned to such term in Section 4.8(ii)
           ---                                                  ---------------
hereof.

          "Affiliates" shall have the meaning assigned to such term in the
           ----------
Credit Agreement.

          "Allocated Indebtedness" shall have the meaning assigned to such term
           ----------------------
in Section 14.20(i) hereof.
   ----------------

          "Allocation Notice" shall have the meaning assigned to such term in
           -----------------
Section 14.20(i) hereof.
----------------

          "Alteration" shall mean any and all additions, modifications or
           ----------
changes, structural or nonstructural.

          "Architect's Certificate" shall have the meaning assigned to such term
           -----------------------
in Section 10.4(ii) hereof.
   ----------------

          "Borrower" shall have the meaning assigned to such term in Recital A
           --------                                                  ---------
hereof.

          "Business Day" shall have the meaning assigned to such term in the
           ------------
Credit Agreement.

          "Charges" shall mean any and all real estate, property and other
           -------
taxes, assessments and special assessments, levies, fees, all water and sewer
rents and charges and all other governmental charges imposed upon or assessed
against, and all claims (including, without limitation, claims for labor,
materials and supplies and other claims arising by operation of law) against,
all or any portions of the Mortgaged Property.
<PAGE>

                                      -3-

          "Collateral" shall have the meaning assigned to such term in Section
           ----------                                                  -------
14.20(i) hereof.
--------

          "Collateral Account" shall have the meaning assigned to such term in
           ------------------
the Security Agreement.

          "Commitments" shall have the meaning assigned to such term in the
           -----------
Credit Agreement.

          "Contested Liens" shall mean, collectively, any Liens incurred in
           ---------------
respect of any Charges to the extent that the amounts owing in respect thereof
are not yet delinquent or are being contested and otherwise comply with the
provisions of Section 9.1 hereof; provided, however, that such Liens shall in
              -----------         --------  -------
all respects be subject and subordinate in priority to the Lien and security
interest created and evidenced by this Mortgage, except if and to the extent
that the law or regulation creating, permitting or authorizing such Lien
provides that such Lien must be superior to the Lien and security interest
created and evidenced hereby.

          "Contracts" shall mean, collectively, any and all right, title and
           ---------
interest of the Mortgagor in and to any and all contracts and other general
intangibles relating to the Mortgaged Property and all reserves, deferred
payments, deposits, refunds and claims of every kind, nature or character
relating thereto.

          "Cost of Construction" shall mean the sum, so far as it relates to the
           --------------------
reconstructing, renewing, restoring or replacing of the Improvements, of (i)
obligations incurred or assumed by the Mortgagor or undertaken by tenants
pursuant to the terms of the Leases for labor, materials and other expenses and
to contractors, builders and materialmen, (ii) the cost of contract bonds and of
insurance of every kind, nature or character that would be deemed by a Prudent
Operator to be necessary or appropriate during the course of construction, (iii)
the expenses incurred or assumed by the Mortgagor for test borings, surveys,
estimates, any Plans and Specifications and preliminary investigations therefor,
and for supervising construction, as well as for the performance of all other
duties required by or reasonably necessary for proper construction, (iv) ad
valorem property taxes levied upon the Premises during performance of any
Restoration and (v) any costs or other charges in connection with obtaining
title insurance and counsel opinions that may be required or necessary in
connection with a Restoration.

          "Credit Agreement" shall have the meaning assigned to such term in
           ----------------
Recital A hereof.
---------

          "Default Rate" shall mean the rate per annum equal to the highest rate
           ------------
then payable under the Credit Agreement.

          "Destruction" shall mean any and all damage to, or loss or destruction
           -----------
of, the Premises or any part thereof.

          "Environmental Law" shall have the meaning assigned to such term in
           -----------------
the Credit Agreement.

          "Estimate" shall have the meaning assigned to such term in Section
           --------                                                  -------
10.4(ii)(D) hereof.
-----------
<PAGE>

                                      -4-

          "Event of Default" shall have the meaning assigned to such term in the
           ----------------
Credit Agreement.

          "Fixture" shall mean all machinery, apparatus, equipment, fittings,
           -------
fixtures, improvements and articles of personal property of every kind,
description and nature whatsoever now or hereafter attached or affixed to the
Land or any other Improvement or used in connection with the use and enjoyment
of the Land or any other Improvement or the maintenance or preservation thereof,
which by the nature of their location thereon or attachment thereto are fixtures
under the UCC or any other applicable law including, without limitation, all
utility systems, fire sprinkler and security systems, drainage facilities,
lighting facilities, all water, sanitary and storm sewer, drainage, electricity,
steam, gas, telephone and other utility equipment and facilities, pipes,
fittings and other items of every kind and description now or hereafter attached
to or located on the Land which by the nature of their location thereon or
attachment thereto are real property under applicable law, HVAC equipment,
boilers, electronic data processing, telecommunications or computer equipment,
refrigeration, electronic monitoring, water or lighting systems, power,
sanitation, waste removal, elevators, maintenance or other systems or equipment.

          "Full Replacement Cost" shall mean the Cost of Construction to replace
           ---------------------
the Improvements, exclusive of depreciation, excavation, foundation and
footings, as determined from time to time (but not less frequently than would be
determined by a Prudent Operator or as otherwise requested by the Mortgagee) by
a Person selected by the Mortgagor and reasonably acceptable to the Mortgagee.

          "GAAP" shall have the meaning assigned to such term in the Credit
           ----
Agreement.

          "Governmental Authority" shall mean any Federal, state, local, foreign
           ----------------------
or other governmental, quasi-governmental or administrative (including self-
regulatory) body, instrumentality, department, agency, authority, board, bureau,
commission, office of any nature whatsoever or other subdivision thereof, or any
court, tribunal, administrative hearing body, arbitration panel or other similar
dispute-resolving body, whether now or hereafter in existence, or any officer or
official thereof, having jurisdiction over the Mortgagor or the Mortgaged
Property or any portion thereof.

          "Hazardous Materials" shall have the meaning assigned to such term in
           -------------------
the Credit Agreement.

          "Improvements" shall mean all buildings, structures and other
           ------------
improvements of every kind or description and any and all Alterations now or
hereafter located, attached or erected on the Land including, without limitation
(i) all Fixtures, (ii) all attachments, railroad tracks, foundations, sidewalks,
drives, roads, curbs, streets, ways, alleys, passages, passageways, sewer
rights, parking areas, driveways, fences and walls and (iii) all materials now
or hereafter located on the Land intended for the construction, reconstruction,
repair, replacement, alteration, addition or improvement of or to such
buildings, Fixtures, structures and improvements, all of which materials shall
be deemed to be part of the Improvements immediately upon delivery thereof on
the Land and to be part of the improvements immediately upon their incorporation
therein.

          "Indemnified Liabilities" shall have the meaning assigned to such term
           -----------------------
in Section 14.6(i) hereof.
   ---------------
<PAGE>

                                      -5-

          "Indemnitees" shall have the meaning assigned to such term in Section
           -----------                                                  -------
14.6(i) hereof.
-------

          "Insurance Certificate" shall mean a certificate evidencing the
           ---------------------
Insurance Requirements (i) in substantially the form commonly known as "ACORD
27" that (A) provides that the insurance has been issued, is in full force and
effect, and conveys all the rights and privileges afforded under the Insurance
Policies, (B) provides an unequivocal obligation to give notice in advance to
additional interest parties of termination and notification in advance of
changes and (C) purports to convey all the privileges of the Insurance Policies
to the certificate holders and (ii) that otherwise complies with the
requirements with respect thereto set forth in Article VIII hereof.
                                               ------------

          "Insurance Policies" means the insurance policies and coverages
           ------------------
required to be maintained by the Mortgagor with respect to the Mortgaged
Property pursuant to Article VIII hereof and all renewals and extensions
                     ------------
thereof.

          "Insurance Requirements" means, collectively, all provisions of the
           ----------------------
Insurance Policies, all requirements of the issuer of any of the Insurance
Policies and all orders, rules, regulations and any other requirements of the
National Board of Fire Underwriters (or any other body exercising similar
functions) binding upon the Mortgagor and applicable to the Mortgaged Property
or any use or condition thereof.

          "Interest Rate Protection Agreements" shall have the meaning assigned
           -----------------------------------
to such term in Recital B hereof.
                ---------

          "Land" shall mean the land described in Schedule A annexed to this
           ----                                   ----------
Mortgage, together with all of the Mortgagor's reversionary rights in and to any
and all easements, rights-of-way, strips and gores of land, waters, water
courses, water rights, mineral, gas and oil rights and all power, air, light and
other rights, estates, titles, interests, privileges, liberties, servitudes,
licenses, tenements, hereditaments and appurtenances whatsoever, in any way
belonging, relating or appertaining thereto, or any part thereof, or which
hereafter shall in any way belong, relate or be appurtenant thereto.

          "Landlord" shall mean any landlord, lessor, franchisor, licensor or
           --------
grantor, as applicable.

          "Leases" shall mean, collectively, any and all interests of the
           ------
Mortgagor, as Landlord, in all leases and subleases of space, tenancies,
franchise agreements, licenses, occupancy or concession agreements now existing
or hereafter entered into, whether or not of record, relating in any manner to
the Premises and any and all amendments, modifications, supplements,
replacements, extensions and renewals if any thereof, whether now in effect or
hereafter coming into effect.

          "Lenders" shall have the meaning assigned to such term in the Preamble
           -------
hereof.

          "Letters of Credit" shall have the meaning assigned to such term in
           -----------------
the Credit Agreement.

          "Liability Insurance" shall mean, collectively, the insurance policies
           -------------------
and coverages described in clauses (ii) and, to the extent applicable, (vi) and
(vii) of Section 8.1 hereof.
         -----------
<PAGE>

                                      -6-

          "Lien" shall have the meaning assigned to such term in the Credit
           ----
Agreement.

          "Loan Documents" shall have the meaning assigned to such term in the
           --------------
Credit Agreement.

          "Loan Parties" shall have the meaning assigned to such term in the
           ------------
Credit Agreement.

          "Loans" shall have the meaning assigned to such term in the Credit
           -----
Agreement.

          "Material Adverse Effect" shall mean (a) a materially adverse effect
           -----------------------
on the business, property, results of operations, prospects or condition,
financial or otherwise, of the Borrower and the Subsidiaries, taken as a whole,
(b) material impairment of the ability of the Mortgagor to perform any of its
obligations under this Mortgage or (c) material impairment of the rights of or
benefits or remedies available to the Mortgagee under this Mortgage including,
without limitation, any material impairment of the value or utility of the
Mortgaged Property or the Lien of this Mortgage.

          "Mortgage" shall have the meaning assigned to such term in the
           --------
Preamble hereof.

          "Mortgaged Property" shall have the meaning assigned to such term in
           ------------------
Section 2.1 hereof.
-----------

          "Mortgagee" shall have the meaning assigned to such term in the
           ---------
Preamble hereof.

          "Mortgagor" shall have the meaning assigned to such term in the
           ---------
Preamble hereof.

          "Mortgagor's Interest" shall have the meaning assigned to such term in
           --------------------
Section 2.2 hereof.
-----------

          "Net Cash Proceeds" shall have the meaning assigned to such term in
           -----------------
the Credit Agreement.

          "Net Condemnation Award" shall have the meaning assigned to such term
           ----------------------
in Section 10.2 hereof.
   ------------

          "Net Insurance Proceeds" shall have the meaning assigned to such term
           ----------------------
in Section 10.1 hereof.
   ------------

          "Officers' Certificate" shall mean, as applied to any corporation, a
           ---------------------
certificate executed on behalf of such corporation by its Chairman of the Board
(if an officer) or its Chief Executive Officer or one of its Vice Presidents (or
an equivalent officer) or by its Chief Financial Officer, Vice President-Finance
or its Treasurer (or an equivalent officer) or any Assistant Treasurer in their
official (and not individual) capacities; provided, however, that every
                                          --------  -------
Officers' Certificate with respect to the compliance with a condition precedent
to the making of any Loan or the taking of any other action hereunder shall
include (i) a statement that the officers making or giving such Officers'
Certificate have read such condition and any definitions or other provisions
contained in this Agreement relating thereto, and (ii) a statement as to
whether, in the opinion of the signers, such condition has been complied with.
<PAGE>

                                      -7-

          "Permit" shall mean any and all permits, certificates, approvals,
           ------
authorizations, consents, licenses, variances, franchises or other instruments,
however characterized, of any Governmental Authority (or any Person acting on
behalf of a Governmental Authority) now or hereafter acquired or held, together
with all amendments, modifications, extensions, renewals and replacements of any
thereof issued or in any way furnished in connection with the Mortgaged Property
including, without limitation, building permits, certificates of occupancy,
environmental certificates, industrial permits or licenses and certificates of
operation.

          "Permitted Collateral Liens" shall have the meaning assigned to such
           --------------------------
term in Section 4.7(v) hereof.
        --------------

          "Permitted Liens" shall have the meaning assigned to such term in the
           ---------------
Credit Agreement.

          "Person" shall have the meaning assigned to such term in the Credit
           ------
Agreement.

          "Plans and Specifications" shall have the meaning assigned to such
           ------------------------
term in Section 10.4(i) hereof.
        ---------------

          "Premises" shall mean, collectively, the Land and the Improvements.
           --------

          "Prior Liens" shall mean, collectively, the Liens identified in
           -----------
Schedule B annexed to this Mortgage.
----------

          "Proceeds" shall mean, collectively, any and all (i) proceeds of the
           --------
conversion, voluntary or involuntary, of any of the Mortgaged Property or any
portion thereof into cash or liquidated claims, (ii) proceeds of any insurance
(except payments made to a Person which is not a party to this Mortgage),
indemnity, warranty, guaranty or claim payable to the Mortgagee or to the
Mortgagor from time to time with respect to any of the Mortgaged Property
including, without limitation, all Net Insurance Proceeds, (iii) payments (in
any form whatsoever) made or due and payable to the Mortgagor from time to time
in connection with any requisition, confiscation, condemnation, seizure or
forfeiture of all or any portion of the Mortgaged Property by any Governmental
Authority (or any Person acting on behalf of a Governmental Authority)
including, without limitation, all Net Condemnation Awards, (iv) products of the
Mortgaged Property and (v) other amounts from time to time paid or payable under
or in connection with any of the Mortgaged Property including, without
limitation, refunds of real estate taxes and assessments, including interest
thereon.

          "Property Insurance" shall mean, collectively, the insurance policies
           ------------------
and coverages described in clauses (i), (iii), (iv), (v) and, to the extent
applicable, (vii) of Section 8.1 hereof.
                     -----------

          "Prudent Operator" shall mean a prudent operator of property similar
           ----------------
in use and configuration to the Premises and located in the locality where the
Premises are located.

          "Real Property Officers' Certificate" shall mean the Officers'
           -----------------------------------
Certificate delivered pursuant to Section 4.02(h)(12) of the Credit Agreement.
<PAGE>

                                      -8-

          "Records" shall mean, collectively, any and all right, title and
           -------
interest of the Mortgagor in and to any and all drawings, plans, specifications,
file materials, operating and maintenance records, catalogues, tenant lists,
correspondence, advertising materials, operating manuals, warranties,
guarantees, appraisals, studies and data relating to the Mortgaged Property or
the construction of any Alteration or the maintenance of any Permit.

          "Remedial Action " shall have the meaning assigned to such term in the
           ---------------
Credit Agreement.

          "Rental Value" shall mean the sum of (x) the total estimated gross
           ------------
rental income from tenant occupation of the Improvements as furnished and
equipped under Leases and (y) the total amount of all other Charges which are
the legal obligation of the Tenants of the Premises under Leases.

          "Rents" shall mean, collectively, any and all rents, additional rents,
           -----
royalties, cash, guaranties, letters of credit, bonds, sureties or securities
deposited under any Lease to secure performance of the Tenant's obligations
thereunder, revenues, earnings, profits and income, advance rental payments,
payments incident to assignment, sublease or surrender of a Lease, claims for
forfeited deposits and claims for damages, now due or hereafter to become due,
with respect to any Lease, any indemnification against, or reimbursement for,
sums paid and costs and expenses incurred by the Mortgagor under any Lease or
otherwise, and any award in the event of the bankruptcy of any Tenant under or
guarantor of a Lease.

          "Requirements of Law" shall mean, collectively, any and all
           -------------------
requirements of any Governmental Authority including, without limitation, any
and all orders, decrees, determinations, laws, treaties, ordinances, rules,
regulations or similar statutes or case law.

          "Restoration" shall have the meaning assigned to such term in Section
           -----------                                                  -------
10.3 hereof.
----

          "Restoration Commitment" shall have the meaning assigned to such term
           ----------------------
in Section 10.4(iii) hereof.
   -----------------

          "Restoration Election Notice" shall have the meaning assigned to such
           ---------------------------
term in Section 10.3 hereof.
        ------------

          "Restoration Letter of Credit" shall have the meaning assigned to such
           ----------------------------
term in Section 10.4(iii) hereof.
        -----------------

          "Secured Obligations" shall mean all obligations (whether or not
           -------------------
constituting future advances, obligatory or otherwise) of the Borrower and any
and all of the other Loan Parties from time to time arising under or in respect
hereof, the Credit Agreement, the Interest Rate Protection Agreements and the
other Loan Documents (including, without limitation, the obligations to pay
principal, interest and all other charges, fees, expenses, commissions,
reimbursements, premiums, indemnities and other payments related to or in
respect of the obligations contained in this Mortgage, the Credit Agreement, the
Interest Rate Protection Agreements and the other Loan Documents), in each case
whether (i) such obligations are direct or indirect, secured or unsecured, joint
or several, absolute or contingent, due or to become due whether at stated
maturity, by acceleration or otherwise, (ii) arising in the regular course of
business or otherwise, (iii) for payment or performance and/or (iv) now existing
or hereafter arising (including, with-
<PAGE>

                                      -9-

out limitation, interest and other obligations arising or accruing after the
commencement of any bankruptcy, insolvency, reorganization or similar proceeding
with respect to any Loan Party or any other Person, or which would have arisen
or accrued but for the commencement of such proceeding, even if such obligation
or the claim therefor is not enforceable or allowable in such proceeding).

          "Secured Parties" shall have the meaning assigned to such term in
           ---------------
Recital H hereof.
---------

          "Security Agreement" shall have the meaning assigned to such term in
           ------------------
the Credit Agreement.

          "Security Documents" shall have the meaning assigned to such term in
           ------------------
the Credit Agreement.

          "Subordination Agreement" shall mean a subordination, nondisturbance
           -----------------------
and attornment agreement substantially in the form of Exhibit 1 annexed to this
                                                      ---------
Mortgage.

          "Subsidiaries" shall have the meaning assigned to such term in the
           ------------
Credit Agreement.

          "Subsidiary Guarantee" shall have the meaning assigned to such term in
           --------------------
Recital D hereof.
---------

          "Subsidiary Guarantors" shall have the meaning assigned to such term
           ---------------------
in the Credit Agreement.

          "Taking" shall mean any taking of the Mortgaged Property or any part
           ------
thereof, in or by condemnation or other eminent domain proceedings pursuant to
any law, general or special, or by reason of the temporary requisition of the
use or occupancy of the Mortgaged Property or any part thereof, by any
Governmental Authority, civil or military.

          "Tax Escrow Fund" shall have the meaning assigned to such term in
           ---------------
Section 7.2 hereof.
-----------

          "Tenant" shall mean any tenant, lessee, sublessee, franchisee,
           ------
licensee, grantee or obligee, as applicable.

          "UCC" shall mean the Uniform Commercial Code as in effect on the date
           ---
hereof in the jurisdiction in which the Premises are located; provided, however,
                                                              --------  -------
that if by reason of mandatory provisions of law, the perfection or the effect
of perfection or non-perfection of the security interest in any item or portion
of the Mortgaged Property is governed by the Uniform Commercial Code as in
effect in a jurisdiction other than the jurisdiction in which the Premises are
located, "UCC" shall mean the Uniform Commercial Code as in effect in such other
jurisdiction for purposes of the provisions hereof relating to such perfection
or effect of perfection or non-perfection.

          SECTION 1.2  Interpretation.  In this Mortgage, unless otherwise
                       --------------
specified, (i) singular words include the plural and plural words include the
singular, (ii) words importing any gender include the other gender, (iii)
references to any Person include such Person's successors and assigns and in the
case of an individual, the word "successors" includes such Person's heirs,
devisees, legatees, executors,
<PAGE>

                                      -10-

administrators and personal representatives, (iv) references to any statute or
other law include all applicable rules, regulations and orders adopted or made
thereunder and all statutes or other laws amending, consolidating or replacing
the statute or law referred to, (v) the words "consent," "approve" and "agree,"
and derivations thereof or words of similar import, mean the prior written
consent, approval or agreement of the Person in question, (vi) the words
"include" and "including," and words of similar import, shall be deemed to be
followed by the words "without limitation," (vii) the words "hereto," "herein,"
"hereof" and "hereunder," and words of similar import, refer to this Mortgage in
its entirety, (viii) references to Articles, Sections, Schedules, Exhibits,
subsections, paragraphs and clauses are to the Articles, Sections, Schedules,
Exhibits, subsections, paragraphs and clauses hereof, (ix) the Schedules and
Exhibits to this Mortgage, in each case as amended, amended and restated,
supplemented or otherwise modified from time to time in accordance with the
provisions hereof, are incorporated herein by reference, (x) the titles and
headings of Articles, Sections, Schedules, Exhibits, subsections, paragraphs and
clauses are inserted as a matter of convenience only and shall not affect the
constructions of any provisions hereof and (xi) all obligations of the Mortgagor
hereunder shall be satisfied by the Mortgagor at the Mortgagor's sole cost and
expense.

          SECTION 1.3  Resolution of Drafting Ambiguities.  The Mortgagor
                       ----------------------------------
acknowledges and agrees that it was represented by counsel in connection with
the execution and delivery hereof, that it and its counsel reviewed and
participated in the preparation and negotiation hereof and that any rule of
construction to the effect that ambiguities are to be resolved against the
drafting party (i.e., Mortgagee) shall not be employed in the interpretation
                ---
hereof.

                                  ARTICLE II

                        GRANTS AND SECURED OBLIGATIONS

          SECTION 2.1  Grant of Mortgaged Property.  The Mortgagor hereby
                       ---------------------------
grants, mortgages, bargains, sells, assigns and conveys to the Mortgagee, and
hereby grants to the Mortgagee, a mortgage lien and security interest in and
upon, all of the Mortgagor's estate, right, title and interest in, to and under
the following property, whether now owned or held or hereafter acquired from
time to time (collectively, the "Mortgaged Property"):
                                 ------------------

           (i)  Land;

           (ii)  Improvements;

           (iii)  Leases;

           (iv)  Rents;

           (v)  Permits;

           (vi)  Contracts;

           (vii)  Records; and
<PAGE>

                                      -11-

           (viii)  Proceeds;

TO HAVE AND TO HOLD the Mortgaged Property, together with all estate, right,
title and interest of the Mortgagor and anyone claiming by, through or under the
Mortgagor in and to the Mortgaged Property and all rights and appurtenances
relating thereto, unto the Mortgagee, its successors and assigns, for the
purpose of securing the payment and performance in full of all the Secured
Obligations.

          SECTION 2.2  Assignment of Leases and Rents.  As additional security
                       ------------------------------
for the payment and performance in full of all the Secured Obligations and
subject to the provisions of Article VI hereof, the Mortgagor absolutely,
                             ----------
presently, unconditionally and irrevocably assigns, transfers and sets over to
the Mortgagee, and grants to the Mortgagee, all of the Mortgagor's estate,
right, title, interest, claim and demand, as Landlord, under any and all of the
Leases including, without limitation, the following (such assigned rights, the
"Mortgagor's Interest"):
 --------------------

           (i)    the immediate and continuing right to receive and collect
     Rents payable by the Tenants pursuant to the Leases;

           (ii)   all claims, rights, powers, privileges and remedies of the
     Mortgagor, whether provided for in the Leases or arising by statute or at
     law or in equity or otherwise, consequent on any failure on the part of the
     Tenants to perform or comply with any term of the Leases;

           (iii)  all rights to take all actions upon the happening of a default
     under the Leases as shall be permitted by the Leases or by law including,
     without limitation, the commencement, conduct and consummation of
     proceeding at law or in equity; and

           (iv)   the full power and authority, in the name of the Mortgagor or
     otherwise, to enforce, collect, receive and receipt for any and all of the
     foregoing and to take all other actions whatsoever which the Mortgagor, as
     Landlord, is or may be entitled to take under the Leases.

          SECTION 2.3  Secured Obligations.  This Mortgage secures, and the
                       -------------------
Mortgaged Property is collateral security for, the payment and performance in
full when due of the Secured Obligations.

          SECTION 2.4  Future Advances.  This Mortgage shall secure future
                       ---------------
advances. The maximum aggregate amount of all advances of principal under the
Credit Agreement (which advances are obligatory to the extent the conditions set
forth in the Credit Agreement relating thereto are satisfied) that may be
outstanding hereunder at any time is $430,000,000, plus interest thereon,
collection costs, sums advanced for the payment of taxes, assessments,
maintenance and repair charges, insurance premiums and any other costs incurred
to protect the security encumbered hereby or the lien hereof, expenses incurred
by the Mortgagee by reason of any default by the Mortgagor under the terms
hereof, together with all other sums secured hereby.

          SECTION 2.5  No Release.  Nothing set forth in this Mortgage shall
                       ----------
relieve the Mortgagor from the performance of any term, covenant, condition or
agreement on the Mortgagor's part to be performed or observed under or in
respect of any of the Mortgaged Property or from any liability to any Person
under or in respect of any of the Mortgaged Property or shall impose any
obligation on the Mortgagee or any other Secured Party to perform or observe any
such term, covenant, condition or agreement
<PAGE>

                                      -12-

on the Mortgagor's part to be so performed or observed or shall impose any
liability on the Mortgagee or any other Secured Party for any act or omission on
the part of the Mortgagor relating thereto or for any breach of any
representation or warranty on the part of the Mortgagor contained in this
Mortgage, any Interest Rate Protection Agreement or any other Loan Document, or
under or in respect of the Mortgaged Property or made in connection herewith or
therewith. The obligations of the Mortgagor contained in this Section 2.5 shall
                                                              -----------
survive the termination hereof and the discharge of the Mortgagor's other
obligations under this Mortgage, any Interest Rate Protection Agreement and the
other Loan Documents.

                                  ARTICLE III

                  REPRESENTATIONS AND WARRANTIES OF MORTGAGOR

          SECTION 3.1  Authority and Validity.
                       ----------------------

          The Mortgagor represents and warrants that:

           (i)    it is duly organized, validly existing and in good standing
     under the laws of the jurisdiction of its organization;

           (ii)   it is duly qualified to transact business and is in good
     standing in the state in which the Mortgaged Property is located;

           (iii)  it has full organizational power and lawful authority to
     execute and deliver this Mortgage and to mortgage and grant a Lien on and
     security interest in the Mortgaged Property and otherwise assign the
     Mortgagor's Interest and otherwise perform its obligations as contemplated
     herein, and all corporate and governmental actions, consents,
     authorizations and approvals necessary or required therefor have been duly
     and effectively taken or obtained; and

           (iv)   this Mortgage is a legal, valid and binding obligation of the
     Mortgagor, enforceable against the Mortgagor in accordance with its terms.

          SECTION 3.2  Warranty of Title.  The Mortgagor represents and
                       -----------------
warrants that:

           (i)    it has good and marketable fee simple title to the Premises
     and the Landlord's interest and estate under or in respect of the Leases
     and good title to the interest it purports to own or hold in and to each of
     the Permits, the Contracts and the Records, in each case subject to no
     Liens, except for Prior Liens;

           (ii)   it has good title to the interest it purports to own or hold
     in and to all rights and appurtenances to or that constitute a portion of
     the Mortgaged Property;

           (iii)  it is in compliance with each term, condition and provision of
     any obligation of the Mortgagor which is secured by the Mortgaged Property
     or the noncompliance with which may result in the imposition of a Lien on
     the Mortgaged Property; and
<PAGE>

                                      -13-

           (iv)   this Mortgage creates and constitutes a valid and enforceable
     first priority Lien on the Mortgaged Property, and, to the extent any of
     the Mortgaged Property shall consist of Fixtures, a first priority security
     interest in the Fixtures, which first priority Lien and first priority
     security interest are subject only to Prior Liens.

          SECTION 3.3  Condition of Mortgaged Property.  The Mortgagor
                       -------------------------------
represents and warrants that:

           (i)    there has been issued and there remains in full force and
     effect subject to no revocation, suspension, forfeiture or modification,
     each and every Permit necessary for the present and contemplated use,
     operation and occupancy of the Premises by the Mortgagor and its Tenants
     and the conduct of their respective businesses and all required zoning,
     building code, land use, environmental and other similar Permits, except to
     the extent that such failure, individually or in the aggregate, could not
     reasonably be expected to result in a Material Adverse Effect;

           (ii)   the Premises and the present and contemplated use and
     occupancy thereof comply with all applicable zoning ordinances, building
     codes, land use laws, set back or other development and use requirements of
     Governmental Authorities, except to the extent that such non-compliance,
     individually or in the aggregate, could not reasonably be expected to
     result in a Material Adverse Effect;

           (iii)  the Premises are served by all utilities (including, without
     limitation, public water and sewer systems) necessary for the present and
     contemplated use thereof, and all utility services are provided by public
     utilities and the Premises have accepted or are equipped to accept such
     utility services and the Mortgagor has not received notice of termination
     of such utility service;

           (iv)   all public roads and streets necessary for service of and
     access to the Premises for the present and contemplated use thereof have
     been completed and have been dedicated and accepted as such by the
     appropriate Governmental Authorities;

           (v)    the Mortgagor has access to the Premises from public roads
     and, to the extent applicable, public or private rail or waterway,
     sufficient to allow the Mortgagor and its Tenants and invitees to conduct
     their respective businesses at the Premises in accordance with sound
     commercial practices and the Mortgagor has not received notice of
     termination of such access;

           (vi)   the Mortgagor has not received notice of any Taking or the
     commencement or pendency of any action or proceeding therefor;

           (vii)  there has not occurred any Destruction of the Premises or any
     portion thereof as a result of any fire or other casualty which as of the
     date hereof has not been restored;

           (viii) there are no disputes regarding boundary lines, location,
     encroachments or possession of any portions of the Mortgaged Property and,
     to the best knowledge of the Mortgagor after due and diligent inquiry, no
     state of facts exists which could give rise to any such claim;
<PAGE>

                                      -14-

           (ix)   all liquid and solid waste disposal, septic and sewer systems
     located on the Premises are in a good and safe condition and repair and in
     compliance with all Requirements of Law, except to the extent that such
     non-compliance, individually or in the aggregate, could not reasonably be
     expected to result in a Material Adverse Effect;

           (x)    no portion of the Premises is located in an area identified by
     the Federal Emergency Management Agency or any successor thereto as an area
     having special flood hazards pursuant to the Flood Insurance Acts or, if
     any portion of the Premises is located within such area, the Mortgagor has
     obtained the insurance prescribed in Article VIII hereof;
                                          ------------

           (xi)   the Premises are assessed for real estate tax purposes as one
     or more wholly independent tax lot or lots, separate from any adjoining
     land or improvements not constituting a portion of such lot or lots, and no
     other land or improvements is assessed and taxed together with the Premises
     or any portion thereof; and

           (xii)  there are no options or rights of first refusal to purchase or
     acquire all or any portion of the Mortgaged Property.

          SECTION 3.4  Leases.  The Mortgagor represents and warrants that:
                       ------

           (i)    the Leases identified in the Real Property Officers'
     Certificate are the only Leases in existence on the date hereof with
     respect to the Premises;

           (ii)   true copies of such Leases have been previously delivered to
     the Mortgagee and there are no agreements with any Tenant under such Leases
     other than those agreements expressly set forth therein;

           (iii)  the Mortgagor is the sole owner of all of the Mortgagor's
     Interest in such Leases;

           (iv)   each of such Leases is in full force and effect, constitutes a
     legal, valid and binding obligation of the Mortgagor and the applicable
     Tenant thereunder, and is enforceable against the Mortgagor and such Tenant
     in accordance with its terms, except as the enforceability thereof may be
     limited by bankruptcy, insolvency, or other similar laws of general
     application affecting the enforcement of creditor's rights;

           (v)    there is no default by Mortgagor or, to the best of
     Mortgagor's knowledge, by any Tenant, under any of such Leases and there is
     existing no condition which with the giving of notice or passage of time or
     both would cause a default thereunder;

           (vi)   all Rents due under such Leases have been paid in full;

           (vii)  none of the Rents reserved under such Leases have been
     assigned or otherwise pledged or hypothecated except in favor of the
     Mortgagee pursuant to the provisions hereof;

           (viii) none of the Rents (other than any security deposit collected
     in accordance with the provisions of the applicable Lease) have been
     collected for more than one (1) month in advance;
<PAGE>

                                      -15-

           (ix)   there exists no offsets or defenses to the payment of any
     portion of the Rents and the Mortgagor owes no monetary obligation to any
     Tenant under any such Lease;

           (x)    the Mortgagor has received no notice from any Tenant
     challenging the validity or enforceability of any such Lease;

           (xi)   no such Lease contains any option to purchase, right of first
     refusal to purchase, right of first refusal to relet, or any other similar
     provision; and

           (xii)  each such Lease is subordinate to this Mortgage either
     pursuant to its terms or pursuant to a recordable Subordination Agreement.

          SECTION 3.5  Insurance.  The Mortgagor represents and warrants that
                       ---------
(i) the Premises and the use, occupancy and operation thereof comply in all
material respects with all Insurance Requirements and, to the best knowledge of
the Mortgagor after due and diligent inquiry, there exists no default under any
Insurance Requirement which could reasonably be expected to have a Material
Adverse Effect, (ii) all premiums due and payable with respect to the Insurance
Policies have been paid and (iii) all Insurance Policies are in full force and
effect and the Mortgagor has not received notice of violation or cancellation
thereof.

          SECTION 3.6  Charges.  The Mortgagor represents and warrants that
                       -------
all Charges imposed upon or assessed against the Mortgaged Property have been
paid and discharged except to the extent such Charges constitute a Lien not yet
due and payable.

          SECTION 3.7  Environmental.  Except as set forth in Schedule 3.17 to
                       -------------                          -------------
the Credit Agreement, the Mortgagor represents and warrants that:

           (i)    it has obtained all Permits which are necessary with respect
     to the ownership and operation of its business and the Mortgaged Property
     under any and all applicable Environmental Laws and is in compliance with
     all terms and conditions thereof, except to the extent that such
     noncompliance or failure to obtain any necessary permits, in the aggregate,
     could not reasonably be expected to result in a Material Adverse Effect;

           (ii)   it is in compliance with any and all applicable Environmental
     Laws including, without limitation, all other limitations, restrictions,
     conditions, standards, prohibitions, requirements, obligations, schedules
     and timetables contained in the Environmental Laws, except to the extent
     that such noncompliance, in the aggregate, could not reasonably be expected
     to result in a Material Adverse Effect;

           (iii)  there is no civil, criminal or administrative action, suit,
     demand, claim, hearing, notice of violation, investigation, proceeding,
     notice of demand letter pending or threatened against it or any Affiliate
     under the Environmental Laws which could result in a fine, penalty or other
     cost or expense which, in the aggregate, could reasonably be expected to
     result in a Material Adverse Effect; and
<PAGE>

                                      -16-

           (iv)  there are no past or present events, conditions, circumstances,
     activities, practices, incidents, actions or plans which may prevent
     compliance with the Environmental Laws, or which could reasonably be
     expected to give rise to any common law or legal liability including,
     without limitation, liability under the Comprehensive Environmental
     Response, Compensation and Liability Act of 1980, as amended, or any other
     Environmental Law or related common law theory or otherwise form the basis
     of any claim, action, demand, suit, proceeding, hearing or notice of
     violation, study or investigation, based on or related to the manufacture,
     processing, distribution, use, generation, treatment, storage, disposal,
     transport or handling, or the emission, discharge, release or threatened
     release into the environment, of any Hazardous Materials which could
     reasonably be expected to result in a fine, penalty or other cost or
     expense which, in the aggregate, could reasonably be expected to result in
     a Material Adverse Effect.

          SECTION 3.8  No Conflicts, Consents, etc.  Neither the execution and
                       ---------------------------
delivery hereof by the Mortgagor nor the consummation of the transactions herein
contemplated nor the fulfillment of the terms hereof (i) violates the terms of
any agreement, indenture, mortgage, deed of trust, equipment lease, instrument
or other document to which the Mortgagor is a party, or by which it may be bound
or to which any of its properties or assets may be subject, which, individually
or in the aggregate, could reasonably be expected to result in a Material
Adverse Effect, (ii) conflicts with any Requirement of Law applicable to the
Mortgagor or its property or (iii) results in or requires the creation or
imposition of any Lien (other than the Lien contemplated hereby) upon or with
respect to any of the Mortgaged Property. No consent of any party (including,
without limitation, equityholders or creditors of the Mortgagor) and no consent,
authorization, approval, license or other action by, and no notice to or filing
with, any Governmental Authority or regulatory body or other Person is required
for (i) the granting of a mortgage Lien on and security interest in the
Mortgaged Property by the Mortgagor granted by it pursuant to this Mortgage or
for the execution, delivery or performance hereof by the Mortgagor except as set
forth in the Real Property Officers' Certificate, except for applicable
recording and filing requirements, or (ii) the exercise by the Mortgagee of the
remedies in respect of the Mortgaged Property pursuant to this Mortgage.

                                  ARTICLE IV

                        CERTAIN COVENANTS OF MORTGAGOR

          SECTION 4.1  Payment.  The Mortgagor shall pay as and when the same
                       -------
shall become due, whether at its stated maturity, by acceleration or otherwise,
each and every amount payable by the Mortgagor under the Loan Documents and any
Interest Rate Protection Agreements.

          SECTION 4.2  Preservation of Corporate Existence.  The Mortgagor
                       -----------------------------------
shall:

           (i)    preserve and maintain in full force and effect its existence
     and good standing under the laws of the jurisdiction of its organization;

           (ii)   preserve and maintain in full force and effect its
     qualification to transact business and good standing in the state in which
     the Mortgaged Property is located; and
<PAGE>

                                      -17-

           (iii)  preserve and maintain in full force and effect all consents,
     authorizations and approvals necessary or required of any Governmental
     Authority or any other Person relating to the execution, delivery and
     performance hereof.

          SECTION 4.3  Title.  The Mortgagor shall:
                       -----

           (i)    (A) keep in effect all rights and appurtenances to or that
     constitute a part of the Mortgaged Property and (B) protect, preserve and
     defend its interest in the Mortgaged Property and title thereto;

           (ii)   (A) comply with each of the terms, conditions and provisions
     of any obligation of the Mortgagor which is secured by the Mortgaged
     Property or the noncompliance with which may result in the imposition of a
     Lien on the Mortgaged Property, (B) forever warrant and defend to the
     Mortgagee the Lien and security interests created and evidenced hereby and
     the validity and priority hereof in any action or proceeding against the
     claims of any and all Persons whomsoever affecting or purporting to affect
     the Mortgaged Property or any of the rights of the Mortgagee hereunder and
     (C) maintain a valid and enforceable first priority Lien on the Mortgaged
     Property and, to the extent any of the Mortgaged Property shall consist of
     Fixtures, a first priority security interest in the Mortgaged Property,
     which first priority Lien and security interest shall be subject only to
     Permitted Collateral Liens; and

           (iii)  immediately upon obtaining knowledge of the pendency of any
     proceedings for the eviction of the Mortgagor from the Mortgaged Property
     or any part thereof by paramount title or otherwise questioning the
     Mortgagor's right, title and interest in, to and under the Mortgaged
     Property as warranted in this Mortgage, or of any condition that could give
     rise to any such proceedings, notify the Mortgagee thereof. The Mortgagee
     may participate in such proceedings and the Mortgagor will deliver or cause
     to be delivered to the Mortgagee all instruments requested by the Mortgagee
     to permit such participation. In any such proceedings, the Mortgagee may be
     represented by counsel selected by Mortgagor reasonably satisfactory to the
     Mortgagee at the expense of the Mortgagor. If, upon the resolution of such
     proceedings, the Mortgagor shall suffer a loss of the Mortgaged Property or
     any part thereof or interest therein and title insurance proceeds shall be
     payable in connection therewith, such proceeds are hereby assigned to and
     shall be paid to the Mortgagee to be applied as Net Cash Proceeds to the
     payment of the Secured Obligations in accordance with the provisions of
     Section 2.13(g) of the Credit Agreement.
     ---------------

          SECTION 4.4  Maintenance and Use of Mortgaged Property; Alterations.
                       ------------------------------------------------------

          (i)     Maintenance.  The Mortgagor shall cause the representations
                  -----------
and warranties set forth in Section 3.3 hereof to continue to be true in each
                            -----------
and every respect and shall pay or cause to be paid when due all Charges, costs
and expenses relating thereto.

         (ii)     Maintenance of Premises.  The Mortgagor shall not commit or
                  -----------------------
suffer any waste on the Premises. The Mortgagor shall, at all times, maintain
the Premises in good, safe and insurable operating order, condition and repair,
reasonable wear and tear excepted, and shall as quickly as practicable make or
cause to be made all repairs, structural or nonstructural, which are necessary
or appropriate in the conduct of the Mortgagor's business. The Mortgagor shall
(A) not, except as permitted in Section 4.4(iii)
                                ----------------
<PAGE>

                                      -18-

hereof, alter the occupancy or use of all or any portion of the Premises without
the prior written consent of the Mortgagee and (B) take all other actions which
from the character or use of the Premises may be necessary or appropriate to
maintain and preserve its value. Except to the extent permitted pursuant to the
provisions of Section 4.4(iii) hereof, the Mortgagor shall not remove, demolish
              ----------------
or alter the design or structural character of any Improvement now or hereafter
erected upon all or any portion of the Premises, or permit any such removal,
demolition or alteration, without the prior written consent of the Mortgagee.

          (iii)   Alterations.  The Mortgagor shall not, without the prior
                  -----------
written consent of the Mortgagee (which consent shall not be unreasonably
withheld), make any Alteration to the Premises that, in each instance, costs
more to effect than $250,000 or which, during any calendar year, in the
aggregate, cost more than $1,000,000 to effect. No prior written consent of the
Mortgagee shall be required for any Alteration to the Premises that, in each
instance, costs less than $250,000 to effect or which, during any calendar year,
in the aggregate, do not cost more than $1,000,000 to effect. Whether or not the
making of any Alteration shall require the consent of the Mortgagee pursuant to
the immediately preceding sentence, the Mortgagor shall (A) complete each
Alteration promptly, in a good and workmanlike manner and in compliance with all
applicable local laws, ordinances and requirements and (B) pay when due all
claims for labor performed and materials furnished in connection with such
Alteration, unless contested in accordance with the provisions of Article X
                                                                  ---------
hereof.

          (iv)    Permits.  The Mortgagor shall maintain, or cause to be
                  -------
maintained, in full force and effect all Permits contemplated by Section 3.3(i)
                                                                 --------------
hereof. Unless and to the extent contested by the Mortgagor in accordance with
the provisions of Article X hereof, the Mortgagor shall comply with all
                  ---------
requirements set forth in the Permits and all Requirements of Law applicable to
all or any portion of the Mortgaged Property or the condition, use or occupancy
of all or any portion thereof or any recorded deed of restriction, declaration,
covenant running with the land or otherwise, now or hereafter in force.

          (v)     Zoning.  The Mortgagor shall not initiate, join in, or
                  ------
consent to any change in the zoning or any other permitted use classification of
the Premises without the prior written consent of the Mortgagee.

          SECTION 4.5  Notices Regarding Certain Defaults.  The Mortgagor
                       ----------------------------------
shall, promptly upon receipt of any written notice regarding (i) any default by
the Mortgagor relating to the Mortgaged Property or any portion thereof or (ii)
the failure to discharge any of Mortgagor's obligations with respect to the
Mortgaged Property or any portion thereof described herein, furnish a copy of
such notice to the Mortgagee.

          SECTION 4.6  Access to Mortgaged Property, Books and Records; Other
                       ------------------------------------------------------
Information. Upon reasonable prior notice and request to the Mortgagor, the
-----------
Mortgagee, its agents, accountants and attorneys shall have full and free access
to visit and inspect, as applicable, during normal business hours and such other
reasonable time as may be reasonably requested by the Mortgagee to all of the
Mortgaged Property including, without limitation, all of the books,
correspondence and records of the Mortgagor relating thereto. The Mortgagee and
its representatives may examine the same, take extracts therefrom and make
photocopies thereof, and the Mortgagor agrees to render to the Mortgagee at the
Mortgagor's cost and expense, such clerical and other assistance as may be
requested by the Mortgagee with regard thereto. The Mortgagor shall, at any and
all times, within a reasonable time after written request by the Mortgagee,
<PAGE>

                                      -19-

furnish or cause to be furnished to the Mortgagee, in such manner and in such
detail as may be reasonably requested by the Mortgagee, additional information
with respect to the Mortgaged Property.

          SECTION 4.7  Limitation on Liens; Transfer Restrictions.  Except as
                       ------------------------------------------
permitted pursuant to the Credit Agreement, the Mortgagor may not, without the
prior written consent of the Mortgagee, further mortgage, encumber, hypothecate,
sell, convey or assign all or any part of the Mortgaged Property or suffer or
allow any of the foregoing to occur by operation of law or otherwise; provided,
                                                                      --------
however, that so long as no Event of Default shall have occurred and be
-------
continuing, the Mortgagor shall have the right to suffer to exist the following
Liens in respect of the Mortgaged Property: (i) Prior Liens (but not extensions,
amendments, supplements or replacements of Prior Liens unless consented to by
the Mortgagee), (ii) the Lien and security interest created by this Mortgage,
(iii) Contested Liens, (iv) Liens of the kind and nature described in clause (f)
of the definition of Permitted Liens and (v) Leases to the extent permitted
pursuant to the provisions of Article V hereof (the Liens described in clauses
                              ---------
(i) through (v) of this sentence, collectively, "Permitted Collateral Liens").
                                                 --------------------------

          SECTION 4.8  Environmental.
                       -------------

          (i)     Hazardous Materials.  The Mortgagor shall (A) comply with
                  -------------------
any and all present and future Environmental Laws except where the failure to
comply could not reasonably be expected to have a Material Adverse Effect, (B)
not release, store, treat, handle, generate, discharge or dispose of any
Hazardous Materials on, under or from the Mortgaged Property in violation of
(which violation could reasonably be expected to have a Material Adverse Effect)
or in a manner that could result in any material liability under any present and
future Environmental Law and (C) take all necessary steps to initiate and
expeditiously complete all remedial, corrective and other action to eliminate
any such effect, provided, however, that Mortgagor shall not be required to
                 --------  -------
undertake any Remedial Action required by Environmental Laws to the extent that
its obligation to do so is being contested in good faith and by proper
proceedings and appropriate reserves are being maintained with respect to such
circumstances in accordance with GAAP. In the event the Mortgagor fails to
comply with the covenants in the preceding sentence, the Mortgagee may, in
addition to any other remedies set forth herein, as agent for and at the
Mortgagor's sole cost and expense, cause any necessary remediation, removal or
response action relating to Hazardous Materials to be taken to achieve
compliance with such covenants and the Mortgagor shall provide to the Mortgagee
and its agents and employees access to the Mortgaged Property for such purpose.
Any reasonable costs or expenses incurred by the Mortgagee for such purpose
shall be immediately due and payable by the Mortgagor and shall bear interest at
the Default Rate. The Mortgagee shall have the right to have an environmental
report prepared as provided in Section 5.10 of the Credit Agreement. The
                               ------------
Mortgagor shall indemnify and hold the Mortgagee and each Lender harmless from
and against all loss, cost, damage or expense (including, without limitation,
reasonable attorneys' and consultants' fees and disbursements and the allocated
costs of staff counsel) that the Mortgagee or such Lender may sustain by reason
of the assertion against the Mortgagee or such Lender by any party of any claim
relating to such Hazardous Materials referred to in clause (i)(B) of this
Section 4.8 on, under or from the Mortgaged Property or actions taken with
-----------
respect thereto as authorized hereunder. The foregoing indemnification shall
survive repayment of all Secured Obligations and any release or assignment
hereof; and

          (ii)    Asbestos.  The Mortgagor shall not install nor permit to be
                  --------
installed in or removed from the Mortgaged Property, asbestos or any asbestos-
containing material (collectively, "ACM") except in compliance with all
                                    ---
applicable Environmental Laws, and with respect to any ACM currently present in
<PAGE>

                                      -20-

the Mortgaged Property, the Mortgagor shall promptly either (A) remove any ACM
which such Environmental Laws require to be removed or (B) otherwise comply with
such Environmental Laws with respect to such ACM, all at the Mortgagor's sole
cost and expense. If the Mortgagor shall fail so to remove any ACM or otherwise
comply with such laws or regulations, the Mortgagee may, in addition to any
other remedies set forth herein, take reasonable or necessary steps to eliminate
such ACM from the Mortgaged Property or otherwise comply with applicable law,
regulations or orders and the Mortgagor shall provide to the Mortgagee and its
agents and employees access to the Mortgaged Property for such purpose. Any
reasonable costs or expenses incurred by the Mortgagee for such purpose shall be
immediately due and payable by the Mortgagor and bear interest at the Default
Rate. The Mortgagor shall indemnify and hold the Mortgagee and each Lender
harmless from and against all loss, cost, damage and expense (including, without
limitation, reasonable attorneys' and consultants' fees and disbursements and
the allocated costs of staff counsel) that the Mortgagee or such Lender may
sustain, by reason of the assertion against the Mortgagee or such Lender by any
third party of a claim as a result of the presence of any ACM and any removal
thereof to the extent required by applicable Environmental Laws or compliance
with all applicable Environmental Laws. The foregoing indemnification shall
survive repayment of all Secured Obligations and any release or assignment
hereof.

          SECTION 4.9  Estoppel Certificates.  The Mortgagor shall, from time
                       ---------------------
to time, upon ten (10) Business Days' prior written request of the Mortgagee,
execute, acknowledge and deliver to the Mortgagee an Officers' Certificate
stating that this Mortgage, the Credit Agreement, each Interest Rate Protection
Agreement and the other Loan Documents are unmodified and in full force and
effect (or, if there have been modifications, that this Mortgage, the Credit
Agreement, such Interest Rate Protection Agreement or such other Loan Document,
as applicable, is in full force and effect as modified and setting forth such
modifications) and stating the date to which principal and interest have been
paid on the Loans.

                                   ARTICLE V

                                    LEASES

          SECTION 5.1  Mortgagor's Affirmative Covenants with Respect to Leases.
                       --------------------------------------------------------
With respect to each Lease, the Mortgagor shall:

           (i)    observe and perform all the obligations imposed upon the
     Landlord under such Lease;

           (ii)   promptly send copies to the Mortgagee of all notices of
     default which the Mortgagor shall send or receive thereunder; and

           (iii)  enforce in a commercially reasonable manner all of the
     material terms, covenants and conditions contained in such Lease upon the
     part of the Tenant thereunder to be observed or performed.

          SECTION 5.2  Mortgagor's Negative Covenants with Respect to Leases.
                       -----------------------------------------------------
With respect to each Lease, the Mortgagor shall not, without the prior written
consent of the Mortgagee:
<PAGE>

                                      -21-

           (i)    receive or collect, or permit the receipt or collection of,
     any Rent under such Lease more than one (1) month in advance of the
     respective period in respect of which such Rent is to accrue, except:

                  (A)  in connection with the execution and delivery of such
                       Lease (or of any amendment to such Lease), Rent
                       thereunder may be collected and received in advance in an
                       amount not in excess of one (1) month's Rent;

                  (B)  the amount held by Landlord as a reasonable security
                       deposit thereunder; and

                  (C)  any amount received and collected for escalation and
                       other charges in accordance with the terms of such Lease;

           (ii)   assign, transfer or hypothecate (other than to the Mortgagee
     hereunder) any Rent under such Lease whether then due or to accrue in the
     future or the interest of the Mortgagor as Landlord under such Lease;

           (iii)  enter into any amendment or modification of such Lease which
     would reduce the unexpired term thereof or decrease the amount of the Rents
     payable thereunder or impair the value or utility of the Mortgaged Property
     or the security provided by this Mortgage;

           (iv)   terminate (whether by exercising any contractual right of the
     Mortgagor to recapture leased space or otherwise) or permit the termination
     of such Lease or accept surrender of all or any portion of the space
     demised under such Lease prior to the end of the term thereof or accept
     assignment of such Lease to the Mortgagor unless:

                  (A)  the Tenant under such Lease has not paid the equivalent
                       of two (2) months' Rent and the Mortgagor has made
                       reasonable efforts to collect such Rent; or

                  (B)  the Mortgagor shall deliver to the Mortgagee an Officers'
                       Certificate to the effect that the Mortgagor has entered
                       into a new Lease (or Leases) for the space covered by the
                       terminated or assigned Lease with a term (or terms) which
                       expire(s) no earlier than the date on which the
                       terminated or assigned Lease was to expire (excluding
                       renewal options), and with a Tenant(s) having a
                       creditworthiness (as reasonably determined by the
                       Mortgagor) sufficient to pay the Rent due under the new
                       Lease (or Leases), and the tenant(s) shall have commenced
                       paying rent, including all operating expenses and other
                       amounts payable under the new Lease (or Leases) without
                       any abatement or concession; or

                  (C)  the Mortgagor or a subsidiary desires to use the space
                       leased for its own purposes; or

           (v)    waive, excuse, condone or in any manner discharge or release
     any Tenants of or from the obligations of such Tenants under their
     respective Leases or guarantors of Tenants from
<PAGE>

                                      -22-

     obligations under any guarantees of the Leases except as the same would be
     done by a Prudent Operator with due regard for the security afforded the
     Mortgagee thereby.

          SECTION 5.3  Additional Requirements with Respect to New Leases.  In
                       --------------------------------------------------
addition to the requirements of Sections 5.1 and 5.2 hereof, the Mortgagor shall
                                ------------     ---
not enter into any Lease after the date hereof unless the Tenant under such
Lease has entered into a Subordination Agreement.

                                  ARTICLE VI

                   CONCERNING ASSIGNMENT OF LEASES AND RENTS

          SECTION 6.1  License to the Mortgagor.  The Mortgagee hereby grants
                       ------------------------
to the Mortgagor a license to collect and apply the Rents and to enforce the
obligations of Tenants under the Leases. Immediately upon the occurrence and
during the continuance of any Event of Default, the license granted in the
immediately preceding sentence shall cease and terminate, with or without any
notice, action or proceeding or the intervention of a receiver appointed by a
court.

          SECTION 6.2  Collection of Rents by the Mortgagee.
                       ------------------------------------

          (i)     Any Rents receivable by the Mortgagee hereunder, after payment
of all proper costs and charges, shall be applied to the Secured Obligations.
The Mortgagee shall be accountable to the Mortgagor only for Rents actually
received by the Mortgagee. The collection of such Rents and the application
thereof shall not cure or waive any Event of Default or waive, modify or affect
notice of Event of Default or invalidate any act done pursuant to such notice.

          (ii)    The Mortgagor hereby authorizes Tenant under each Lease to
rely upon and comply with any and all notices or demands from the Mortgagee for
payment of Rents to the Mortgagee and the Mortgagor shall have no claim against
Tenant for Rents paid by Tenant to the Mortgagee pursuant to such notice or
demand.

          SECTION 6.3  No Release.  Neither this Mortgage nor any action or
                       ----------
inaction on the part of the Mortgagee shall release Tenant under any Lease, any
guarantor of any Lease or the Mortgagor from any of their respective obligations
under such Leases or constitute an assumption of any such obligation on the part
of the Mortgagee. No action or failure to act on the part of the Mortgagor shall
adversely affect or limit the rights of the Mortgagee under this Mortgage or,
through this Mortgage, under such Leases. Nothing contained herein shall operate
or be construed to (i) obligate the Mortgagee to perform any of the terms,
covenants or conditions contained in any Lease or otherwise to impose any
obligation upon the Mortgagee with respect to such Lease (including, without
limitation, any obligation arising out of any covenant of quiet enjoyment
contained in such Lease in the event that Tenant under such Lease shall have
been joined as a party defendant in any action by which the estate of such
Tenant shall be terminated) or (ii) place upon the Mortgagee any responsibility
for the operation, control, care, management or repair of the Premises.

          SECTION 6.4  Irrevocable Interest.  All rights, powers and
                       --------------------
privileges of the Mortgagee herein set forth are coupled with an interest and
are irrevocable, subject to the terms and conditions
<PAGE>

                                      -23-

hereof, and the Mortgagor shall not take any action under the Leases or
otherwise which is inconsistent with this Mortgage or any of the terms hereof
and any such action inconsistent herewith or therewith shall be void.

          SECTION 6.5  Amendment to Leases.  Each Lease, including, without
                       -------------------
limitation, all amendments, modifications, supplements, replacements, extensions
and renewals thereof, shall continue to be subject to the provisions hereof
without the necessity of any further act by any of the parties hereto.

                                  ARTICLE VII

                       TAXES AND CERTAIN STATUTORY LIENS

          SECTION 7.1  Payment of Charges.  Unless and to the extent contested
                       ------------------
by the Mortgagor in accordance with the provisions of Article IX hereof, the
                                                      ----------
Mortgagor shall pay and discharge, or cause to be paid and discharged, from time
to time when the same shall become due, all Charges. The Mortgagor shall, upon
the Mortgagee's request, deliver to the Mortgagee receipts evidencing the
payment of all such Charges.

          SECTION 7.2  Escrow of Taxes.  From and after the occurrence of an
                       ---------------
Event of Default, at the option and upon the request of the Mortgagee, the
Mortgagor shall deposit with the Mortgagee in an account maintained by the
Mortgagee (the "Tax Escrow Fund"), on the first day of each month, an amount
                ---------------
estimated by the Mortgagee to be equal to one-twelfth of the annual real
property taxes and other annual Charges required to be discharged by the
Mortgagor under Section 7.1 hereof. Such amounts shall be held by the Mortgagee
                -----------
without interest to the Mortgagor and applied to the payment of the obligations
in respect of which such amounts were deposited, in such priority as the
Mortgagee shall determine, on or before the respective dates on which such
obligations or any part thereof would become delinquent. Nothing contained in
this Article VII shall (i) affect any right or remedy of the Mortgagee under any
     -----------
provision hereof or of any statute or rule of law to pay any such amount as
provided above from its own funds and to add the amount so paid, together with
interest at the Default Rate during such time that any amount remains
outstanding, to the Secured Obligations or (ii) relieve the Mortgagor of its
obligations to make or provide for the payment of the annual real property taxes
and other annual Charges required to be discharged by the Mortgagor under
Section 7.1 hereof. During the continuance of any Event of Default, the
-----------
Mortgagee may, at its option, apply all or any part of the sums held pursuant to
this Section 7.2 to payment and performance of the Secured Obligations. The
     -----------
Mortgagor shall redeposit with the Mortgagee an amount equal to all amounts so
applied as a condition to the cure, if any, of such Event of Default in addition
to fulfillment of any other required conditions.

          SECTION 7.3  Certain Statutory Liens.  Unless and to the extent
                       -----------------------
contested by the Mortgagor in accordance with the provisions of Article IX
                                                                ----------
hereof, the Mortgagor shall timely pay, or cause to be paid, all lawful claims
and demands of mechanics, materialmen, laborers, government agencies
administering worker's compensation insurance, old age pensions and social
security benefits and all other claims, judgments, demands or amounts of any
nature which, if unpaid, might result in, or permit the creation of, a Lien on
the Mortgaged Property or any part thereof, or which might result in forfeiture
of all or any part of the Mortgaged Property.
<PAGE>

                                      -24-

          SECTION 7.4  Stamp and Other Taxes.  Unless and to the extent
                       ---------------------
contested by the Mortgagor in accordance with the provisions of Article IX
                                                                ----------
hereof, the Mortgagor shall pay any United States documentary stamp taxes, with
interest and fines and penalties, and any mortgage recording taxes, with
interest and fines and penalties, that may hereafter be levied, imposed or
assessed under or upon or by reason hereof or the Secured Obligations or any
instrument or transaction affecting or relating to either thereof and in default
thereof the Mortgagee may advance the same and the amount so advanced shall be
payable by the Mortgagor to the Mortgagee in accordance with the provisions of
Section 14.5 hereof.
------------

          SECTION 7.5  Certain Tax Law Changes.  In the event of the passage
                       -----------------------
after the date hereof of any law deducting from the value of real property, for
the purpose of taxation, amounts in respect of any Lien thereon or changing in
any way the laws for the taxation of mortgages or debts secured by mortgages for
state or local purposes or the manner of the collection of any Charges, and
imposing any Charges, either directly or indirectly, on this Mortgage, any
Interest Rate Protection Agreement or any other Loan Document, the Mortgagor
shall promptly pay to the Mortgagee such amount or amounts as may be necessary
from time to time to pay any such Charges.

          SECTION 7.6  Proceeds of Tax Claim.  In the event that the proceeds
                       ---------------------
of any tax claim are paid after the Mortgagee has exercised its right to
foreclose the Lien hereof, such proceeds shall be paid to the Mortgagee to
satisfy any deficiency remaining after such foreclosure. The Mortgagee shall
retain its interest in the proceeds of any tax claim during any redemption
period. The amount of any such proceeds in excess of any deficiency claim of the
Mortgagee shall in a reasonably prompt manner be released to the Mortgagor.

                                 ARTICLE VIII

                                   INSURANCE

          SECTION 8.1  Required Insurance Policies and Coverages.  The
                       -----------------------------------------
Mortgagor shall maintain in respect of the Premises the following insurance
policies and coverages:

           (i)    Physical hazard insurance on an "all risk" basis covering,
     without limitation, hazards commonly covered by fire and extended coverage,
     lightning, windstorm, civil commotion, hail, riot, strike, water damage,
     sprinkler leakage, collapse and malicious mischief, in an amount equal to
     the Full Replacement Cost of the Improvements, with policy limits and
     deductibles in such amounts as the Mortgagee may from time to time require
     and, if the Mortgagee shall not have imposed any such requirements, as
     would be maintained by a Prudent Operator;

           (ii)   Commercial general liability insurance against claims for
     bodily injury, death or property damage occurring on, in or about the
     Premises and any other adjoining streets, sidewalks and passageways, and
     covering any and all claims, including, without limitation, all legal
     liability to the extent insurable imposed upon the Mortgagee and all court
     costs and attorneys' fees, arising out of or connected with the possession,
     use, leasing, operation or condition of the Premises with policy limits and
     deductibles in such amounts as the Mortgagee may from time to time require
     and, if the Mortgagee shall not have imposed such requirements, in such
     amounts as would be maintained by a Prudent Operator;
<PAGE>

                                      -25-

           (iii)  Explosion insurance in respect of any boilers, machinery and
     similar apparatus located on or comprising the Premises, with policy limits
     and deductibles in such amounts as the Mortgagee may from time to time
     require, and, if the Mortgagee shall not have imposed any such
     requirements, in such amounts as would be maintained by a Prudent Operator;

           (iv)   Business interruption insurance and/or loss of "rental value"
     insurance covering one (1) year of loss, the term "rental value" to mean
     the sum of (x) the total estimated gross rental income from tenant
     occupancy of the Improvements as furnished and equipped under Leases and
     (y) the total amount of all other charges which are the legal obligation of
     the Tenants of the Premises under Leases;

           (v)    If the Premises are located in an area identified by the
     Federal Emergency Management Agency as an area having special flood hazards
     pursuant to the National Flood Insurance Act of 1968 or the Flood Disaster
     Protection Act of 1973, each as amended, or any successor laws, flood
     insurance with policy limits and deductibles in such amounts as the
     Mortgagee may from time to time reasonably require and, if the Mortgagee
     shall not have imposed any such requirements, in such amounts as would be
     maintained by a Prudent Operator;

           (vi)   Worker's compensation insurance as required by the laws of the
     state where the Premises are located to protect the Mortgagor and the
     Mortgagee against claims for injuries sustained in the course of employment
     at the Premises; and

           (vii)  such other insurance, against risks and with such policy
     limits and deductibles in such amounts as the Mortgagee may from time to
     time reasonably require, and, if no such requirements shall have been
     imposed, in such amounts as would be maintained by a Prudent Operator.

          SECTION 8.2  Required Form of Insurance Policies.  Each Insurance
                       -----------------------------------
Policy described in Section 8.1 hereof shall provide that:
                    -----------

           (i)    it may not be modified, reduced, cancelled or otherwise
     terminated without at least thirty (30) days' prior written notice to the
     Mortgagee;

           (ii)   the Mortgagee is permitted to pay any premium therefor within
     thirty (30) days after receipt of any notice stating that such premium has
     not been paid when due;

           (iii)  all losses thereunder shall be payable notwithstanding any act
     or negligence of the Mortgagor or its agents or employees which otherwise
     might have resulted in a forfeiture of all or a part of such insurance
     payments;

           (iv)   to the extent such Insurance Policy constitutes Property
     Insurance, all losses payable thereunder shall be payable to the Mortgagee,
     as loss payee, pursuant to a standard non-contributory New York mortgagee
     endorsement and shall be in an amount, at least sufficient to prevent
     coinsurance liability; and
<PAGE>

                                      -26-

           (v)    with respect to Liability Insurance, the Mortgagee shall be
     named as an additional insured.

          SECTION 8.3  Settlements.  Settlement or adjustment of any claim
                       -----------
under any of the Insurance Policies, if such claim involves any loss in excess
of $1,000,000 (in the reasonable judgment of the Mortgagee), shall require the
prior written approval of the Mortgagee, and the Mortgagor shall cause each such
policy to contain a provision to such effect. The Mortgagor shall be permitted
to settle or adjust any claim under any of the Insurance Policies, if such claim
involves any loss less than or equal to $1,000,000 (in the reasonable judgment
of the Mortgagee).

          SECTION 8.4  Renewals.  At least ten (10) days prior to the expiration
                       --------
of any Insurance Policy, the Mortgagor shall deliver to the Mortgagee an
Insurance Policy or Policies renewing or extending such expiring Insurance
Policy or Policies, renewal or extension Insurance Certificates or other
reasonable evidence of renewal or extension providing that the Insurance
Policies are in full force and effect.

          SECTION 8.5  Additional Insurance.  The Mortgagor shall not purchase
                       --------------------
separate insurance policies concurrent in form or contributing in the event of
loss with those Insurance Policies required to be maintained under this Article
                                                                        -------
VIII unless the Mortgagee is included thereon as an additional insured and, if
----
applicable, with loss payable to the Mortgagee under an endorsement containing
the provisions described in Section 8.2 hereof. The Mortgagor shall immediately
                            -----------
notify the Mortgagee whenever any such separate insurance policy is obtained and
shall promptly deliver to the Mortgagee the Insurance Policy or Insurance
Certificate evidencing such insurance.

          SECTION 8.6  Blanket Coverage.  The Mortgagor may maintain the
                       ----------------
coverages required by Section 8.1 hereof under blanket policies covering the
                      -----------
Premises and other locations owned or operated by the Mortgagor or an Affiliate
of the Mortgagor if the terms of such blanket policies otherwise comply with the
provisions of Section 8.1 hereof and contain specific coverage allocations in
              -----------
respect of the Premises complying with the provisions of Section 8.1 hereof.
                                                         -----------

          SECTION 8.7  Delivery After Foreclosure.  In the event that the
                       --------------------------
proceeds of any insurance claim are paid after the Mortgagee has exercised its
right to foreclose the Lien hereof, such proceeds shall be paid to the Mortgagee
to satisfy any deficiency remaining after such foreclosure. Mortgagee shall
retain its interest in the Insurance Policies required to be maintained pursuant
to this Mortgage during any redemption period.

                                  ARTICLE IX

                            CONTESTING OF PAYMENTS

          SECTION 9.1  Contesting of Taxes and Certain Statutory Liens.  The
                       -----------------------------------------------
Mortgagor may at its own expense contest the validity, amount or applicability
of any Charges by appropriate legal or administrative proceedings, prosecution
of which operates to prevent the collection or enforcement thereof and the sale
or forfeiture of the Mortgaged Property or any part thereof to satisfy such
obligations; provided, however, that (i) any such contest shall be conducted in
             --------  -------
good faith by appropriate proceedings instituted with reasonable promptness and
diligently conducted and (ii) in connection with such contest, the
<PAGE>

                                      -27-

Mortgagor shall have (A) made provision for the payment of such contested Charge
on the Mortgagor's books if and to the extent required by GAAP, or (B) at the
option and upon the request of the Mortgagee, have deposited with the Mortgagee
a sum sufficient to pay and discharge such Charge and the Mortgagee's estimate
of all interest and penalties related thereto, properly bonded such amount or
obtained a stay of enforcement of any such Lien pending the final determination
of such proceeding and (C) in the case of any contested judgment, delivered to
the Mortgagee an instrument in which an insurance carrier acceptable to the
Mortgagee shall have agreed in writing that full insurance coverage (subject to
a customary deductible) exists in respect of such contested judgment.
Notwithstanding the foregoing provisions of this Section 9.1, (i) no contest of
                                                 -----------
any such obligations may be pursued by the Mortgagor if such contest would
expose the Mortgagee or any Lender to (A) any possible criminal liability or (B)
unless the Mortgagor shall have furnished a bond or other security therefor
reasonably satisfactory to the Mortgagee or such Lender, as the case may be, any
additional civil liability for failure to comply with such obligations and (ii)
if at any time payment or performance of any obligation contested by the
Mortgagor pursuant to this Section 9.1 shall become necessary to prevent the
                           -----------
imposition of remedies because of non-payment, the Mortgagor shall pay or
perform the same in sufficient time to prevent the imposition of remedies in
respect of such default or prospective default.

          SECTION 9.2  Contesting of Insurance.  The Mortgagor shall not take
                       -----------------------
any action that could be the basis for termination, revocation or denial of any
insurance coverage required to be maintained under this Mortgage or that could
be the basis for a defense to any claim under any Insurance Policy maintained in
respect of the Premises and the Mortgagor shall otherwise comply in all respects
with all Insurance Requirements in respect of the Premises; provided, however,
                                                            --------  -------
that the Mortgagor may, at its own expense and after written notice to the
Mortgagee, (i) contest the applicability or enforceability of any such Insurance
Requirements by appropriate legal proceedings, prosecution of which does not
constitute a basis for cancellation or revocation of any insurance coverage
required under Article VIII hereof or (ii) cause the Insurance Policy containing
               ------------
any such Insurance Requirement to be replaced by a new policy complying with the
provisions of Article VIII hereof.
              ------------

                                   ARTICLE X

                   DESTRUCTION, CONDEMNATION AND RESTORATION

          SECTION 10.1  Destruction.  If there shall occur any Destruction,
                        -----------
other than a Destruction for a de minimis amount (which for the purposes of this
Section 10.1 shall mean any Destruction for an amount less than or equal to
------------
$25,000), the Mortgagor shall promptly send to the Mortgagee a written notice
setting forth the nature and extent of such Destruction. The proceeds of any
insurance payable in respect of such Destruction are hereby assigned and shall
be paid to the Mortgagee and deposited in the Collateral Account. All such
proceeds, together with any interest earned thereon, less the amount of any
reasonable third-party expenses incurred in litigating, arbitrating,
compromising or settling any claim arising out of such Destruction (the "Net
                                                                         ---
Insurance Proceeds"), shall be applied in accordance with the provisions of
------------------
Sections 10.3, 10.4 and 10.5 hereof.
-------------  ----     ----

          SECTION 10.2  Condemnation.  If there shall occur any Taking or the
                        ------------
commencement of any proceeding thereof, the Mortgagor shall immediately notify
the Mortgagee upon receiving notice of such Taking or commencement of
proceedings therefor. The Mortgagee may, at its option, participate in
<PAGE>

                                      -28-

any proceedings or negotiations which might result in any Taking, and the
Mortgagor shall deliver or cause to be delivered to the Mortgagee all
instruments requested by it to permit such participation. The Mortgagee may be
represented by counsel satisfactory to it at the expense of the Mortgagor in
connection with any such participation. The Mortgagor shall pay all fees, costs
and expenses incurred by the Mortgagee in connection with any Taking and in
seeking and obtaining any award or payment on account thereof. Any proceeds,
award or payment in respect of any Taking are hereby assigned and shall be paid
to the Mortgagee. The Mortgagor shall take all steps necessary to notify the
condemning authority of such assignment. Such proceeds, award or payment,
together with any interest earned thereon, less the amount of any reasonable
third-party expenses incurred in litigating, arbitrating, compromising or
settling any claim arising out of such Taking (the "Net Condemnation Award"),
                                                    ----------------------
shall be applied in accordance with the provisions of Sections 10.3, 10.4 and
                                                      -------------  ----
10.5 hereof.
----

          SECTION 10.3  Restoration.  So long as no Event of Default shall
                        -----------
have occurred and be continuing, in the event there shall be a Net Condemnation
Award or Net Insurance Proceeds in an amount less than $1,000,000, the Mortgagor
shall have the right, at the Mortgagor's option, to apply such Net Condemnation
Award or Net Insurance Proceeds to the payment of the Secured Obligations in
accordance with the provisions of Section 2.13(f) of the Credit Agreement or to
                                  --------------
perform a restoration (each, a "Restoration") of the Premises. In the event the
                                -----------
Mortgagor elects to perform a Restoration pursuant to the immediately preceding
sentence, the Mortgagor shall within thirty (30) days after the date that the
Mortgagor receives notice of collection by the Mortgagee of the applicable Net
Insurance Proceeds or Net Condemnation Award, as the case may be, deliver to the
Mortgagee (i) a written notice of such election and (ii) an Officers'
Certificate stating that (A) the Net Insurance Proceeds or Net Condemnation
Award, as the case may be, shall be utilized to perform a Restoration in the
manner contemplated by this Section 10.3 and (B) no Event of Default has
                            ------------
occurred and is continuing (the items described in clauses (i) and (ii) of this
sentence, collectively, the "Restoration Election Notice"). In the event the
                             ---------------------------
Mortgagee does not receive a Restoration Election Notice within such 30-day
period, the Mortgagee may apply any such Net Insurance Proceeds or Net
Condemnation Award held by the Mortgagee to the payment of the Secured
Obligations in accordance with the provisions of Section 2.13(f) of the Credit
                                                 ---------------
Agreement or, at the option of the Mortgagee, may continue to hold such Net
Insurance Proceeds or Net Condemnation Award in the Collateral Account as
additional collateral to secure the performance by the Mortgagor of the Secured
Obligations.  In the event the Mortgagor elects to perform any Restoration
contemplated by this Section 10.3, the Mortgagee shall release such Net
                     ------------
Condemnation Award or Net Insurance Proceeds to the Mortgagor as soon as
practicable following receipt of a Restoration Election Notice in accordance
with the provisions of Section 8.2(ii) of the Security Agreement.  The Mortgagor
                       ---------------
shall, within fifteen (15) days following the date of its receipt of any
proceeds in respect of a Destruction or Taking, as the case may be, commence and
diligently continue to perform the Restoration of that portion or portions of
the Improvements subject to such Destruction or affected by such Taking so that,
upon the completion of the Restoration, the Premises will be in the same
condition and shall be of at least equal value and utility for its intended
purposes as the Premises was immediately prior to such Destruction or Taking.
The Mortgagor shall so complete such Restoration with its own funds to the
extent that the amount of any Net Condemnation Award or Net Insurance Proceeds
is insufficient for such purpose.

          SECTION 10.4  Major Restoration.  In the event there shall be a Net
                        -----------------
Condemnation Award or Net Insurance Proceeds in an amount equal to or greater
than $1,000,000, the Mortgagee shall have the option to apply such Net
Condemnation Award or Net Insurance Proceeds, as the case may be, to the payment
of the Secured Obligations in accordance with the provisions of Section 2.13(f)
                                                                ---------------
of the Credit Agreement or to require a Restoration of the Premises. In the
event a Restoration is to be performed under this Section 10.4, the Mortgagee
                                                  ------------
shall not release any part of the Net Condemnation Award or Net Insur-
<PAGE>

                                      -29-

ance Proceeds except in accordance with the provisions of Section 10.5 hereof,
                                                          ------------
and the Mortgagor shall, prior to commencing any work to effect a Restoration of
the Premises, promptly (but in no event later than ninety (90) days following
any Destruction or Taking) furnish to the Mortgagee:

           (i)    complete plans and specifications (the "Plans and
                                                          ---------
     Specifications") for the Restoration;

           (ii)   a certificate (an "Architect's Certificate") of an
                                    -----------------------
     independent, reputable architect or engineer acceptable to the Mortgagee
     and licensed in the state where the Premises are located (A) listing all
     permits and approvals required by law in connection with the Restoration,
     (B) stating that all permits and approvals required by law to commence work
     in connection with the Restoration have been obtained, (C) stating that the
     Plans and Specifications have been reviewed and approved by the signatory
     thereto, (D) stating such signatory's estimate (an "Estimate") of the costs
                                                         --------
     of completing the Restoration and (E) stating that upon completion of such
     Restoration in accordance with the Plans and Specifications, the value and
     utility of the Premises will be approximately equal to or greater than the
     value and utility thereof immediately prior to the Destruction or Taking
     relating to such Restoration; and

           (iii)  if the Estimate exceeds the Net Insurance Proceeds or Net
     Condemnation Award, as the case may be, a surety bond for, guarantee of, or
     irrevocable letter of credit (a "Restoration Letter of Credit") or other
                                      ----------------------------
     irrevocable and unconditional commitment to provide funds (each, a
     "Restoration Commitment") for the payment of the excess cost of such
      ----------------------
     Restoration, payable to or in favor of the Mortgagee, as Collateral Agent,
     which bond, guaranty, Restoration Letter of Credit or Restoration
     Commitment (A) shall be signed by a surety or sureties or guarantor(s), as
     the case may be, acceptable to the Mortgagee and, in the case of a
     Restoration Letter of Credit or Restoration Commitment, shall be provided
     by a Lender or other financial institution having capital and surplus in
     excess of $500 million as shown in its most recent available statement of
     financial condition and (B) shall be in an amount not less than the excess
     of the amount of the Estimate over the amount of the Net Condemnation Award
     or Net Insurance Proceeds, as the case may be, then held by the Mortgagee
     for application toward the cost of such Restoration.

          The Mortgagee shall have the right to review and approve the Plans and
Specifications, which approval shall not be unreasonably withheld, conditioned
or delayed. Promptly upon any approval of the Plans and Specifications by the
Mortgagee, the Mortgagor shall commence and diligently continue to perform the
Restoration in accordance with such approved Plans and Specifications. The
Mortgagor shall so complete such Restoration with its own funds to the extent
that the amount of any Net Condemnation Award or Net Insurance Proceeds is
insufficient for such purpose.

          SECTION 10.5  Restoration Advances Following Destruction or Taking of
                        -------------------------------------------------------
Mortgaged Property.  In the event the Mortgagor shall be required or permitted
------------------
to perform a Restoration of the Premises as provided in Section 10.4 hereof, the
                                                        ------------
Mortgagee shall apply any Net Insurance Proceeds or the Net Condemnation Award
held by the Mortgagee on account of the applicable Destruction or Taking to the
payment of the cost of performing such Restoration and shall pay portions of the
same, from time to time, to the Mortgagor or, at the Mortgagee's option,
exercised from time to time, directly to the contractors, subcontractors,
materialmen, laborers, engineers, architects, and other Persons rendering
services or material for such Restoration, subject to the following conditions:
<PAGE>

                                      -30-

           (i)    Each request for payment shall be made on at least ten (10)
     days' prior notice to the Mortgagee and shall be accompanied by an
     Architect's Certificate stating (A) that all the Restoration work then
     completed has been done in compliance with the Plans and Specifications, as
     approved by the Mortgagee, and in accordance with all provisions of law,
     (B) the sums requested are required to reimburse the Mortgagor for payments
     by the Mortgagor to, or are due to, the contractors, subcontractors,
     materialmen, laborers, engineers, architects, or other persons rendering
     services or materials for the Restoration, and that, when added to the
     sums, if any, previously paid out by the Mortgagee, such sums do not exceed
     the cost of the Restoration to the date of such Architect's Certificate,
     (C) whether or not the Estimate continues to be accurate, and if not, what
     the entire cost of such Restoration is then estimated to be and (D) that
     the amount of the Net Insurance Proceeds or Net Condemnation Award, as the
     case may be, remaining after giving effect to such payment will be
     sufficient on completion of the Restoration to pay for the same in full
     (including, in detail, an estimate by trade of the remaining costs of
     completion);

           (ii)   Each request for payment shall be accompanied by an opinion of
     counsel to the Mortgagor (which counsel shall be independent and acceptable
     to the Mortgagee), or a title insurance policy, binder or endorsement in
     form and substance satisfactory to the Mortgagee confirming that (A) all
     Liens (other than Permitted Collateral Liens) covering that part of the
     Restoration previously paid for, if any, have been waived and (B) there has
     not been filed with respect to all or any portion of the Premises any Lien
     (other than Permitted Collateral Liens); and

           (iii)  The final request for any payment after the Restoration has
     been completed shall be accompanied by an Architect's Certificate listing
     all Permits necessary to comply with all Requirements of Law in connection
     with or as a result of such Restoration and stating that all of the same
     have been obtained.

          In the event that there shall be any surplus after application of the
Net Condemnation Award or the Net Insurance Proceeds to Restoration of the
Improvements, such surplus shall be applied as Net Cash Proceeds in accordance
with Section 2.13(f) of the Credit Agreement or, at the option of the Mortgagee,
     ---------------
shall be held by the Mortgagee in the Collateral Account as additional
collateral to secure the performance by the Mortgagor of the Secured
Obligations.

                                  ARTICLE XI

                        EVENTS OF DEFAULT AND REMEDIES

          SECTION 11.1  Events of Default.  It shall be an Event of Default
                        -----------------
hereunder if there shall have occurred and be continuing an Event of Default
under the Credit Agreement.

          SECTION 11.2  Remedies in Case of an Event of Default.  If any Event
                        ---------------------------------------
of Default shall have occurred and be continuing, the Mortgagee may at its
option, in addition to any other action permitted under this Mortgage or the
Credit Agreement or by law, statute or in equity, take one or more of the
following actions to the greatest extent permitted by local law:
<PAGE>

                                     -31-

           (i) by written notice to the Mortgagor, declare the entire unpaid
     amount of the Secured Obligations to be due and payable immediately;

          (ii) personally, or by its agents or attorneys, (A) enter into and
     upon and take possession of all or any part of the Premises together with
     the books, records and accounts of the Mortgagor relating thereto and,
     exclude the Mortgagor, its agents and servants wholly therefrom, (B) use,
     operate, manage and control the Premises and conduct the business thereof,
     (C) maintain and restore the Premises, (D) make all necessary or proper
     repairs, renewals and replacements and such useful Alterations thereto and
     thereon as the Mortgagee may deem advisable, (E) manage, lease and operate
     the Premises and carry on the business thereof and exercise all rights and
     powers of the Mortgagor with respect thereto either in the name of the
     Mortgagor or otherwise or (F) collect and receive all Rents.  The Mortgagee
     shall be under no liability for or by reason of any such taking of
     possession, entry, removal or holding, operation or management except that
     any amounts so received by the Mortgagee shall be applied as follows:

                    FIRST: to pay reasonable costs and expenses (including,
                    -----
          without limitation, attorneys' fees and expenses) of so entering upon,
          taking possession of, holding, operating and managing the Mortgaged
          Property or any part thereof, and any taxes, assessments or other
          charges which the Mortgagee may consider necessary or desirable to
          pay, and any other amounts due to the Mortgagee;

                    SECOND: without duplication of amounts applied pursuant to
                    ------
          clause FIRST above, to the indefeasible payment in full in cash of the
                 -----
          Secured Obligations (other than obligations arising under any Interest
          Rate Protection Agreement) in accordance with the terms of the Credit
          Agreement;

                    THIRD: without duplication of amounts applied pursuant to
                    -----
          clauses FIRST and SECOND above, to the indefeasible payment in full in
                  -----     ------
          cash pro rata of the obligations arising under the  Interest Rate
               --- ----
          Protection Agreements in accordance with the terms of the Interest
          Rate Protection Agreements; and

                    FOURTH: the balance, if any, to the Person lawfully entitled
                    ------
          thereto (including the Mortgagor or its successors or assigns), if all
          conditions to the release hereof shall have been fulfilled, but if any
          such condition shall not have been fulfilled, to be held by the
          Mortgagee and thereafter applied to any future payments required to be
          made in accordance with clauses FIRST, SECOND and THIRD above.
                                          -----  ------     -----

           (iii)  with or without entry, personally or by its agents or
     attorneys, (A) sell the Mortgaged Property and all estate, right, title and
     interest, claim and demand therein at one or more sales in one or more
     parcels, in accordance with the provisions of Section 11.3 or (B) institute
                                                   ------------
     and prosecute proceedings for the complete or partial foreclosure of the
     Lien and security interests created and evidenced hereby; or

            (iv)  take such steps to protect and enforce its rights whether by
     action, suit or proceeding at law or in equity for the specific performance
     of any covenant, condition or agreement in the Credit Agreement and the
     other Loan Documents, or in aid of the execution of any power granted
<PAGE>

                                     -32-

     in this Mortgage, or for any foreclosure hereunder, or for the enforcement
     of any other appropriate legal or equitable remedy or otherwise as the
     Mortgagee shall elect.

          SECTION 11.3  Sale of Mortgaged Property if Event of Default Occurs;
                        ------------------------------------------------------
Proceeds of Sale.
----------------

          (i)  If any Event of Default shall have occurred and be continuing,
the Mortgagee may institute an action to foreclose this Mortgage or take such
other action as may be permitted and available to the Mortgagee at law or in
equity for the enforcement of the Credit Agreement and realization on the
Mortgaged Property and proceeds thereon through power of sale or to final
judgment and execution thereof for the Secured Obligations, and in furtherance
thereof the Mortgagee may sell the Mortgaged Property at one or more sales, as
an entirety or in parcels, at such time and place, upon such terms and after
such notice thereof as may be required or permitted by law or statute or in
equity. The Mortgagee may execute and deliver to the purchaser at such sale a
conveyance of the Mortgaged Property in fee simple and an assignment or
conveyance of all the Mortgagor's Interest in the Leases and the Mortgaged
Property, each of which conveyances and assignments shall contain recitals as to
the Event of Default upon which the execution of the power of sale herein
granted depends, and the Mortgagor hereby constitutes and appoints the Mortgagee
the true and lawful attorney in fact of the Mortgagor to make any such recitals,
sale, assignment and conveyance, and all of the acts of the Mortgagee as such
attorney in fact are hereby ratified and confirmed. The Mortgagor agrees that
such recitals shall be binding and conclusive upon the Mortgagor and that any
assignment or conveyance to be made by the Mortgagee shall divest the Mortgagor
of all right, title, interest, equity and right of redemption, including any
statutory redemption, in and to the Mortgaged Property. The power and agency
hereby granted are coupled with an interest and are irrevocable by death or
dissolution, or otherwise, and are in addition to any and all other remedies
which the Mortgagee may have hereunder, at law or in equity. So long as the
Secured Obligations, or any part thereof, remain unpaid, the Mortgagor agrees
that possession of the Mortgaged Property by the Mortgagor, or any person
claiming under the Mortgagor, shall be as tenant, and, in case of a sale under
power or upon foreclosure as provided in this Mortgage, the Mortgagor and any
person in possession under the Mortgagor, as to whose interest such sale was not
made subject, shall, at the option of the purchaser at such sale, then become
and be tenants holding over, and shall forthwith deliver possession to such
purchaser, or be summarily dispossessed in accordance with the laws applicable
to tenants holding over. In case of any sale under this Mortgage by virtue of
the exercise of the powers herein granted, or pursuant to any order in any
judicial proceeding or otherwise, the Mortgaged Property may be sold as an
entirety or in separate parcels in such manner or order as the Mortgagee in its
sole discretion may elect. One or more exercises of powers herein granted shall
not extinguish or exhaust such powers, until the entire Mortgaged Property is
sold or all amounts secured hereby are paid in full.

         (ii)  In the event of any sale made under or by virtue of this Article
                                                                        -------
XI, the entire principal of, and interest in respect of the Secured Obligations,
--
if not previously due and payable, shall, at the option of the Mortgagee,
immediately become due and payable, anything in this Mortgage to the contrary
notwithstanding.

        (iii)  The proceeds of any sale made under or by virtue of this
Article XI, together with any other sums which then may be held by the Mortgagee
----------
under this Mortgage, whether under the provisions of this Article XI or
                                                          ----------
otherwise, shall be applied as follows:
<PAGE>

                                     -33-

          FIRST: to pay the costs and expenses incurred by the Mortgagee in
          -----
     enforcing its remedies under this Mortgage;

          SECOND: to pay the costs and expenses of the sale and of any receiver
          ------
     of the Mortgaged Property or any part thereof appointed pursuant to Section
                                                                         -------
     11.5(ii);
     --------

          THIRD: without duplication of the amounts applied pursuant to clauses
          -----
     FIRST and SECOND above, to the indefeasible payment in full in cash of the
     -----     ------
     Secured Obligations (other than the obligations arising under the Interest
     Rate Protection Agreements) in accordance with the terms of the Credit
     Agreement;

          FOURTH: without duplication of the amounts applied pursuant to
          ------
     clauses FIRST, SECOND and THIRD above, to the indefeasible payment in full
             -----  ------     -----
     in cash pro rata of the obligations arising under the Interest Rate
             --- ----
     Protection Agreements in accordance with the terms of the Interest Rate
     Protection Agreements; and

          FIFTH: the balance, if any, to the Person lawfully entitled thereto
          -----
     (including the Mortgagor or its successors or assigns).

          (iv) The Mortgagee (on behalf of any Lender or on its own behalf) or
any Lender or any of their respective Affiliates may bid for and acquire the
Mortgaged Property or any part thereof at any sale made under or by virtue of
this Article XI and, in lieu of paying cash therefor, may make settlement for
     ----------
the purchase price by crediting against the purchase price the unpaid amounts
(whether or not then due) owing to the Mortgagee, or such Lender in respect of
the Secured Obligations, after deducting from the sales price the expense of the
sale and the reasonable costs of the action or proceedings and any other sums
that the Mortgagee or such Lender is authorized to deduct under this Mortgage.

           (v) The Mortgagee may adjourn from time to time any sale by it to be
made under or by virtue hereof by announcement at the time and place appointed
for such sale or for such adjourned sale or sales, and, the Mortgagee, without
further notice or publication, may make such sale at the time and place to which
the same shall be so adjourned.

          (vi) If the Premises is comprised of more than one parcel of land, the
Mortgagee may take any of the actions authorized by this Section 11.3 in respect
                                                         ------------
of any or a number of individual parcels.

          SECTION 11.4  Additional Remedies in Case of an Event of Default.
                        --------------------------------------------------

          (i) The Mortgagee shall be entitled to recover judgment as aforesaid
either before, after or during the pendency of any proceedings for the
enforcement of the provisions hereof, and the right of the Mortgagee to recover
such judgment shall not be affected by any entry or sale hereunder, or by the
exercise of any other right, power or remedy for the enforcement of the
provisions hereof, or the foreclosure of, or absolute conveyance pursuant to,
this Mortgage.  In case of proceedings against the Mortgagor in insolvency or
bankruptcy or any proceedings for its reorganization or involving the
liquidation of its assets, the Mortgagee shall be entitled to prove the whole
amount of principal and interest and other payments, charges and costs due in
respect of the Secured Obligations to the full amount thereof without deducting
therefrom any proceeds obtained from the sale of the whole or any part of the
Mortgaged Prop-
<PAGE>

                                     -34-

erty; provided, however, that in no case shall the Mortgagee receive a greater
      --------  -------
amount than the aggregate of such principal, interest and such other payments,
charges and costs (with interest at the Default Rate) from the proceeds of the
sale of the Mortgaged Property and the distribution from the estate of the
Mortgagor.

          (ii) Any recovery of any judgment by the Mortgagee and any levy of any
execution under any judgment upon the Mortgaged Property shall not affect in any
manner or to any extent the Lien and security interests created and evidenced
hereby upon the Mortgaged Property or any part thereof, or any conveyances,
powers, rights and remedies of the Mortgagee hereunder, but such conveyances,
powers, rights and remedies shall continue unimpaired as before.

         (iii) Any monies collected by the Mortgagee under this Section 11.4
                                                                ------------
shall be applied in accordance with the provisions of Section 11.3(iii).
                                                      -----------------

          SECTION 11.5  Legal Proceedings After an Event of Default.
                        -------------------------------------------

          (i)  After the occurrence of any Event of Default and immediately upon
the commencement of any action, suit or legal proceedings to obtain judgment for
the Secured Obligations or any part thereof, or of any proceedings to foreclose
the Lien and security interest created and evidenced hereby or otherwise enforce
the provisions hereof or of any other proceedings in aid of the enforcement
hereof, the Mortgagor shall enter its voluntary appearance in such action, suit
or proceeding.

         (ii)  Upon the occurrence and during the continuance of an Event of
Default, the Mortgagee shall be entitled forthwith as a matter of right,
concurrently or independently of any other right or remedy hereunder either
before or after declaring the Secured Obligations or any part thereof to be due
and payable, to the appointment of a receiver without giving notice to any party
and without regard to the adequacy or inadequacy of any security for the Secured
Obligations or the solvency or insolvency of any person or entity then legally
or equitably liable for the Secured Obligations or any portion thereof.  The
Mortgagor hereby consents to the appointment of such receiver.  Notwithstanding
the appointment of any receiver, the Mortgagee shall be entitled as pledgee to
the possession and control of any cash, deposits or instruments at the time held
by or payable or deliverable under the terms of the Credit Agreement to the
Mortgagee.

        (iii)  The Mortgagor shall not (A) at any time insist upon, or plead,
or in any manner whatsoever claim or take any benefit or advantage of any stay
or extension or moratorium law, any exemption from execution or sale of the
Mortgaged Property or any part thereof, wherever enacted, now or at any time
hereafter in force, which may affect the covenants and terms of performance
hereof, (B) claim, take or insist on any benefit or advantage of any law now or
hereafter in force providing for the valuation or appraisal of the Mortgaged
Property, or any part thereof, prior to any sale or sales of the Mortgaged
Property which may be made pursuant to this Mortgage, or pursuant to any decree,
judgment or order of any court of competent jurisdiction or (C) after any such
sale or sales, claim or exercise any right under any statute heretofore or
hereafter enacted to redeem the property so sold or any part thereof.  To the
extent permitted by applicable law, the Mortgagor hereby expressly (A) waives
all benefit or advantage of any such law or laws, including, without limitation,
any statute of limitations applicable to this Mortgage, (B) waives any and all
rights to trial by jury in any action or proceeding related to the enforcement
hereof, (C) waives any objection which it may now or hereafter have to the
laying of venue of any action, suit or
<PAGE>

                                     -35-

proceeding brought in connection with this Mortgage and further waives and
agrees not to plead that any such action, suit or proceeding brought in any such
court has been brought in an inconvenient forum and (D) covenants not to hinder,
delay or impede the execution of any power granted or delegated to the Mortgagee
by this Mortgage but to suffer and permit the execution of every such power as
though no such law or laws had been made or enacted. The Mortgagee shall not be
liable for any incorrect or improper payment made pursuant to this Article XI in
                                                                   ----------
the absence of gross negligence or willful misconduct.

          SECTION 11.6  Remedies Not Exclusive. No remedy conferred upon or
                        ----------------------
reserved to the Mortgagee by this Mortgage is intended to be exclusive of any
other remedy or remedies, and each and every such remedy shall be cumulative and
shall be in addition to every other remedy given under this Mortgage or now or
hereafter existing at law or in equity. Any delay or omission of the Mortgagee
to exercise any right or power accruing on any Event of Default shall not impair
any such right or power and shall not be construed to be a waiver of or
acquiescence in any such Event of Default. Every power and remedy given by this
Mortgage may be exercised from time to time concurrently or independently, when
and as often as may be deemed expedient by the Mortgagee in such order and
manner as the Mortgagee, in its sole discretion, may elect. If the Mortgagee
accepts any monies required to be paid by the Mortgagor under this Mortgage
after the same become due, such acceptance shall not constitute a waiver of the
right either to require prompt payment, when due, of all other sums secured by
this Mortgage or to declare an Event of Default with regard to subsequent
defaults. If the Mortgagee accepts any monies required to be paid by the
Mortgagor under this Mortgage in an amount less than the sum then due, such
acceptance shall be deemed an acceptance on account only and on the condition
that it shall not constitute a waiver of the obligation of the Mortgagor to pay
the entire sum then due, and the Mortgagor's failure to pay the entire sum then
due shall be and continue to be a default hereunder notwithstanding acceptance
of such amount on account.

                                  ARTICLE XII

                     SECURITY AGREEMENT AND FIXTURE FILING

          SECTION 12.1 Security Agreement. To the extent that the Mortgaged
                       ------------------
Property includes personal property or items of personal property which are or
are to become fixtures under applicable law, this Mortgage shall also be
construed as a security agreement under the UCC; and, upon and during the
continuance of an Event of Default, the Mortgagee shall be entitled with respect
to such personal property to exercise all remedies hereunder, all remedies
available under the UCC with respect to fixtures and all other remedies
available under applicable law. Without limiting the foregoing, such personal
property may, at the Mortgagee's option, (i) be sold hereunder together with any
sale of any portion of the Mortgaged Property or otherwise, (ii) be sold
pursuant to the UCC, or (iii) be dealt with by the Mortgagee in any other manner
permitted under applicable law. The Mortgagee may require the Mortgagor to
assemble such personal property and make it available to the Mortgagee at a
place to be designated by the Mortgagee. The Mortgagor acknowledges and agrees
that a disposition of the personal property in accordance with the Mortgagee's
rights and remedies in respect to the Mortgaged Property as heretofore provided
is a commercially reasonable disposition thereof; provided, however, that the
                                                  --------  -------
Mortgagee shall give the Mortgagor not less than ten (10) days' prior notice of
the time and place of any intended disposition.
<PAGE>

                                     -36-

          SECTION 12.2  Fixture Filing. To the extent that the Mortgaged
                        --------------
Property includes items of personal property which are or are to become fixtures
under applicable law, and to the extent permitted under applicable law, the
filing hereof in the real estate records of the county in which such Mortgaged
Property is located shall also operate from the time of filing as a fixture
filing with respect to such Mortgaged Property, and the following information is
applicable for the purpose of such fixture filing, to wit:

<TABLE>
<CAPTION>
----------------------------------------------------------------------------
<S>                                  <C>
    Name and Address of the debtor:   Name and Address of the secured party:

    The Mortgagor having the address  The Mortgagee having the address
    described in the Preamble hereof. described in the Preamble hereof.

   -------------------------------------------------------------------------
    This Financing Statement covers the following types or items of
    property:

    The Mortgaged Property.

    This instrument covers goods or items of personal property which are or
    are to become fixtures upon the property.

    The name of the record owner of the Property on which such fixtures are
    or are to be located is the Mortgagor.

----------------------------------------------------------------------------
</TABLE>

                                 ARTICLE XIII

                              FURTHER ASSURANCES

          SECTION 13.1  Recording Documentation To Assure Security. The
                        ------------------------------------------
Mortgagor shall, forthwith after the execution and delivery hereof and
thereafter, from time to time, cause this Mortgage and any financing statement,
continuation statement or similar instrument relating to any thereof or to any
property intended to be subject to the Lien hereof to be filed, registered and
recorded in such manner and in such places as may be required by any present or
future law in order to publish notice of and fully to protect the validity and
priority thereof or the Lien hereof purported to be created upon the Mortgaged
Property and the interest and rights of the Mortgagee therein. The Mortgagor
shall pay or cause to be paid all taxes and fees incident to such filing,
registration and recording, and all expenses incident to the preparation,
execution and acknowledgment thereof, and of any instrument of further
assurance, and all Federal or state stamp taxes or other taxes, duties and
charges arising out of or in connection with the execution and delivery of such
instruments.

          SECTION 13.2  Further Acts. The Mortgagor shall, at the sole cost
                        ------------
and expense of the Mortgagor, do, execute, acknowledge and deliver all and every
such further acts, deeds, conveyances, mortgages, assignments, notices of
assignment, transfers, financing statements, continuation statements,
instruments and assurances as the Mortgagee shall from time to time request,
which may be necessary in the reasonable judgment of the Mortgagee from time to
time to assure, perfect, convey, assign, mortgage, transfer and confirm unto the
Mortgagee, the property and rights hereby conveyed or assigned or which the
Mortgagor may be or may hereafter become bound to convey or assign to the
Mortgagee or for carry-
<PAGE>

                                     -37-

ing out the intention or facilitating the performance of the terms hereof or the
filing, registering or recording hereof. Without limiting the generality of the
foregoing, in the event that the Mortgagee desires to exercise any remedies,
consensual rights or attorney-in-fact powers set forth in this Mortgage and
reasonably determines it necessary to obtain any approvals or consents of any
Governmental Authority or any other Person therefor, then, upon the reasonable
request of the Mortgagee, the Mortgagor agrees to use its best efforts to assist
and aid the Mortgagee to obtain as soon as practicable any necessary approvals
or consents for the exercise of any such remedies, rights and powers. In the
event the Mortgagor shall fail after demand to execute any instrument or take
any action required to be executed or taken by the Mortgagor under this Section
                                                                        -------
13.2, the Mortgagee may execute or take the same as the attorney-in-fact for the
----
Mortgagor, such power of attorney being coupled with an interest and is
irrevocable.

          SECTION 13.3  Additional Security. Without notice to or consent of
                        -------------------
the Mortgagor and without impairment of the Lien and rights created by this
Mortgage, the Mortgagee may accept (but the Mortgagor shall not be obligated to
furnish) from the Mortgagor or from any other Person, additional security for
the Secured Obligations.  Neither the giving hereof nor the acceptance of any
such additional security shall prevent the Mortgagee from resorting, first, to
such additional security, and, second, to the security created by this Mortgage
without affecting the Mortgagee's Lien and rights under this Mortgage.

                                  ARTICLE XIV

                                 MISCELLANEOUS

          SECTION 14.1  Covenants To Run with the Land. All of the grants,
                        ------------------------------
covenants, terms, provisions and conditions in this Mortgage shall run with the
Land and shall apply to, and bind the successors and assigns of, the Mortgagor.
If there shall be more than one mortgagor with respect to the Mortgaged
Property, the covenants and warranties hereof shall be joint and several.

          SECTION 14.2  No Merger. The rights and estate created by this
                        ---------
Mortgage shall not, under any circumstances, be held to have merged into any
other estate or interest now owned or hereafter acquired by the Mortgagee unless
the Mortgagee shall have consented to such merger in writing.

          SECTION 14.3  Concerning Mortgagee.
                        --------------------

          (i)  The Mortgagee has been appointed as collateral agent pursuant to
the Credit Agreement. The actions of the Mortgagee hereunder are subject to the
provisions of the Credit Agreement. The Mortgagee shall have the right hereunder
to make demands, to give notices, to exercise or refrain from exercising any
rights, and to take or refrain from taking action (including, without
limitation, the release or substitution of the Mortgaged Property), in
accordance with this Mortgage and the Credit Agreement. The Mortgagee may employ
agents and attorneys-in-fact in connection herewith and shall not be liable for
the negligence or misconduct of any such agents or attorneys-in-fact selected by
it in good faith. The Mortgagee may resign and a successor Mortgagee may be
appointed in the manner provided in the Credit Agreement. Upon the acceptance of
any appointment as the Mortgagee by a successor Mortgagee, that successor
Mortgagee shall thereupon succeed to and become vested with all the rights,
powers, privileges and duties of the retiring Mortgagee under this Mortgage, and
the retiring Mortgagee shall thereupon be discharged from its duties and
obligations under this Mortgage. After any retiring Mortga-
<PAGE>

                                     -38-

gee's resignation, the provisions hereof shall inure to its benefit as to any
actions taken or omitted to be taken by it under this Mortgage while it was the
Mortgagee.

          (ii) The Mortgagee shall be deemed to have exercised reasonable care
in the custody and preservation of the Mortgaged Property in its possession if
such Mortgaged Property is accorded treatment substantially equivalent to that
which the Mortgagee, in its individual capacity, accords its own property
consisting of similar instruments or interests, it being understood that neither
the Mortgagee nor any of the Secured Parties shall have responsibility for
taking any necessary steps to preserve rights against any Person with respect to
any Mortgaged Property.

         (iii) The Mortgagee shall be entitled to rely upon any written
notice, statement, certificate, order or other document or any telephone message
believed by it to be genuine and correct and to have been signed, sent or made
by the proper person, and, with respect to all matters pertaining to this
Mortgage and its duties hereunder, upon advice of counsel selected by it.

          (iv) With respect to any of its rights and obligations as a Lender,
the Mortgagee shall have and may exercise the same rights and powers hereunder.
The term "Lenders," "Lender" or any similar terms shall, unless the context
clearly otherwise indicates, include the Mortgagee in its individual capacity as
a Lender. The Mortgagee may accept deposits from, lend money to, and generally
engage in any kind of banking, trust or other business with the Mortgagor or any
Affiliate of the Mortgagor to the same extent as if the Mortgagee were not
acting as collateral agent.

           (v) If any portion of the Mortgaged Property also constitutes
collateral granted to the Mortgagee under any other deed of trust, mortgage,
security agreement, pledge or instrument of any type, in the event of any
conflict between the provisions hereof and the provisions of such other deed of
trust, mortgage, security agreement, pledge or instrument of any type in respect
of such collateral, the Mortgagee, in its sole discretion, shall select which
provision or provisions shall control.

          SECTION 14.4  Mortgagee May Perform; Mortgagee Appointed Attorney-in-
                        ------------------------------------------------------
Fact. If the Mortgagor shall fail to perform any covenants contained in this
----
Mortgage (including, without limitation, the Mortgagor's covenants to (i) pay
the premiums in respect of all required insurance policies hereunder, (ii) pay
Charges, (iii) make repairs, (iv) discharge Liens or (v) pay or perform any
obligations of the Mortgagor under any Mortgaged Property) or if any warranty on
the part of the Mortgagor contained herein shall be breached, the Mortgagee may
(but shall not be obligated to) do the same or cause it to be done or remedy any
such breach, and may expend funds for such purpose; provided, however, that the
                                                    --------  -------
Mortgagee shall in no event be bound to inquire into the validity of any tax,
lien, imposition or other obligation which the Mortgagor fails to pay or perform
as and when required hereby and which the Mortgagor does not contest in
accordance with the provisions of Section 14.5 hereof.  Any and all reasonable
                                  ------------
amounts so expended by the Mortgagee shall be paid by the Mortgagor in
accordance with the provisions of Article IX hereof.  Neither the provisions of
                                  -----------
this Section 14.4 nor any action taken by the Mortgagee pursuant to the
     ------------
provisions of this Section 14.4 shall prevent any such failure to observe any
                   ------------
covenant contained in this Mortgage nor any breach of warranty from constituting
an Event of Default.  The Mortgagor hereby appoints the Mortgagee its attorney-
in-fact, with full authority in the place and stead of the Mortgagor and in the
name of the Mortgagor, or otherwise, from time to time in the Mortgagee's
discretion to take any action and to execute any instrument consistent with the
terms hereof and the other Loan Documents which the Mortgagee may deem necessary
or advisable to accomplish the purposes hereof.
<PAGE>

                                     -39-

The foregoing grant of authority is a power of attorney coupled with an interest
and such appointment shall be irrevocable for the term hereof. The Mortgagor
hereby ratifies all that such attorney shall lawfully do or cause to be done by
virtue hereof.

          SECTION 14.5  Expenses. The Mortgagor will upon demand pay to the
                        --------
Mortgagee the amount of any and all reasonable costs and expenses, including the
fees and expenses of its counsel and the fees and expenses of any experts and
agents which the Mortgagee may incur in connection with (i) any action, suit or
other proceeding affecting the Mortgaged Property or any part thereof commenced,
in which action, suit or proceeding the Mortgagee is made a party or
participates or in which the right to use the Mortgaged Property or any part
thereof is threatened, or in which it becomes necessary in the reasonable
judgment of the Mortgagee to defend or uphold the Lien hereof (including,
without limitation, any action, suit or proceeding to establish or uphold the
compliance of the Mortgaged Property with any Requirements of Law), (ii) the
collection of the Secured Obligations, (iii) the enforcement and administration
hereof, (iv) the custody or preservation of, or the sale of, collection from, or
other realization upon, any of the Mortgaged Property, (v) the exercise or
enforcement of any of the rights of the Mortgagee or any Secured Party hereunder
or (vi) the failure by the Mortgagor to perform or observe any of the provisions
hereof.  All reasonable amounts expended by the Mortgagee and payable by the
Mortgagor under this Section 14.5 shall be due upon demand therefor (together
                     ------------
with interest thereon accruing at the Default Rate during the period from and
including the date on which such funds were so expended to the date of
repayment) and shall be part of the Secured Obligations.  The Mortgagor's
obligations under this Section 14.5 shall survive the termination hereof and the
                       ------------
discharge of the Mortgagor's other obligations under this Mortgage, the Credit
Agreement, any Interest Rate Protection Agreement and the other Loan Documents.

          SECTION 14.6  Indemnity.
                        ---------

          (i) The Mortgagor agrees to indemnify, pay and hold harmless the
Mortgagee and each of the other Secured Parties and the officers, directors,
employees, agents and Affiliates of the Mortgagee and each of the other Secured
Parties (collectively, the "Indemnitees") from and against any and all other
                            -----------
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
claims, costs (including, without limitation, settlement costs), expenses or
disbursements of any kind or nature whatsoever (including, without limitation,
the fees and disbursements of counsel for such Indemnitees in connection with
any investigative, administrative or judicial proceeding, commenced or
threatened, whether or not such Indemnitee shall be designated a party thereto),
which may be imposed on, incurred by or asserted against that Indemnitee, in any
manner relating to or arising out hereof, any Interest Rate Protection Agreement
or any other Loan Document (including, without limitation, any misrepresentation
by the Mortgagor in this Mortgage, any Interest Rate Protection Agreement or any
other Loan Document) (the "Indemnified Liabilities"); provided, however, that
                           -----------------------    --------  -------
the Mortgagor shall have no obligation to an Indemnitee hereunder with respect
to Indemnified Liabilities if it has been determined by a final decision (after
all appeals and the expiration of time to appeal) by a court of competent
jurisdiction that such Indemnified Liabilities arose from the gross negligence,
bad faith or willful misconduct of that Indemnitee.  To the extent that the
undertaking to indemnify, pay and hold harmless set forth in the preceding
sentence may be unenforceable because it is violative of any law or public
policy, the Mortgagor shall contribute the maximum portion which it is permitted
to pay and satisfy under applicable law, to the payment and satisfaction of all
Indemnified Liabilities incurred by the Indemnitees or any of them.

<PAGE>

                                     -40-

          (ii)  Survival. The obligations of the Mortgagor contained in this
                --------
Section 14.6 shall survive the termination hereof and the discharge of the
------------
Mortgagor's other obligations under this Mortgage, any Interest Rate Protection
Agreement and the other Loan Documents.

         (iii)  Reimbursement.  Any amount paid by any Indemnitee as to which
                -------------
such Indemnitee has the right to reimbursement shall constitute Secured
Obligations secured by the Mortgaged Property.

          SECTION 14.7  Continuing Security Interest; Assignment. This
                        ----------------------------------------
Mortgage shall create a continuing Lien on and security interest in the
Mortgaged Property and shall (i) be binding upon the Mortgagor, its respective
successors and assigns and (ii) inure, together with the rights and remedies of
the Mortgagee hereunder, to the benefit of the Mortgagee and the other Secured
Parties and each of their respective successors, transferees and assigns.  No
other Persons (including, without limitation, any other creditor of any Loan
Party) shall have any interest herein or any right or benefit with respect
hereto.  Without limiting the generality of the foregoing clause (ii), any
Lender may assign or otherwise transfer any indebtedness held by it secured by
this Mortgage to any other Person, and such other Person shall thereupon become
vested with all the benefits in respect thereof granted to such Lender, herein
or otherwise, subject however, to the provisions of the Credit Agreement and any
applicable Interest Rate Protection Agreement.

          SECTION 14.8  Termination; Release. When all the Secured
                        --------------------
Obligations have been paid in full and the Commitments of the Lenders to make
any Loan or to issue any Letter of Credit under the Credit Agreement shall have
expired or been sooner terminated, this Mortgage shall terminate.  Upon
termination hereof or any release of the Mortgaged Property or any portion
thereof in accordance with the provisions of the Credit Agreement, the Mortgagee
shall, upon the request and at the sole reasonable cost and expense of the
Mortgagor, forthwith assign, transfer and deliver to the Mortgagor, against
receipt and without recourse to or warranty by the Mortgagee, such of the
Mortgaged Property to be released (in the case of a release) as may be in
possession of the Mortgagee and as shall not have been sold or otherwise applied
pursuant to the terms hereof, and, with respect to any other Mortgaged Property,
proper documents and instruments (including UCC-3 termination statements or
releases) acknowledging the termination hereof or the release of such Mortgaged
Property, as the case may be.

          SECTION 14.9  Modification in Writing. No amendment, modification,
                        -----------------------
supplement, termination or waiver of or to any provision hereof, nor consent to
any departure by the Mortgagor therefrom, shall be effective unless the same
shall be done in accordance with the terms of the Credit Agreement and unless in
writing and signed by the Mortgagee.  Any amendment, modification or supplement
of or to any provision hereof, any waiver of any provision hereof and any
consent to any departure by the Mortgagor from the terms of any provision hereof
shall be effective only in the specific instance and for the specific purpose
for which made or given.  Except where notice is specifically required by this
Mortgage or any other Loan Document, no notice to or demand on the Mortgagor in
any case shall entitle the Mortgagor to any other or further notice or demand in
similar or other circumstances.

          SECTION 14.10  Notices. Unless otherwise provided herein or in the
                         -------
Credit Agreement, any notice or other communication herein required or permitted
to be given shall be given in the manner and become effective as set forth in
the Credit Agreement, if to the Mortgagor or the Mortgagee, addressed to it at
the address set forth in the Credit Agreement, or in each case at such other
address as shall
<PAGE>

                                     -41-

be designated by such party in a written notice to the other party complying as
to delivery with the terms of this Section 14.10.
                                   -------------

          SECTION 14.11 GOVERNING LAW; SERVICE OF PROCESS; WAIVER OF JURY TRIAL.
                        -------------------------------------------------------
THIS MORTGAGE SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN
ACCORDANCE WITH, THE LAWS OF THE STATE IN WHICH THE PREMISES ARE LOCATED,
WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAWS, EXCEPT TO THE EXTENT THAT THE
VALIDITY OR PERFECTION OF THE SECURITY INTEREST HEREUNDER, OR REMEDIES
HEREUNDER, IN RESPECT OF ANY PARTICULAR ITEM OR TYPE OF MORTGAGED PROPERTY ARE
GOVERNED BY THE LAWS OF A JURISDICTION OTHER THAN SUCH STATE. MORTGAGOR AGREES
THAT SERVICE OF PROCESS IN ANY PROCEEDING MAY BE EFFECTED BY MAILING A COPY
THEREOF BY REGISTERED OR CERTIFIED MAIL (OR ANY SUBSTANTIALLY SIMILAR FORM OF
MAIL), POSTAGE PREPAID, TO BORROWER AT ITS ADDRESS SET FORTH IN THE CREDIT
AGREEMENT OR AT SUCH OTHER ADDRESS OF WHICH THE MORTGAGEE SHALL HAVE BEEN
NOTIFIED PURSUANT THERETO. IF ANY AGENT APPOINTED BY MORTGAGOR REFUSES TO ACCEPT
SERVICE, MORTGAGOR HEREBY AGREES THAT SERVICE UPON IT BY MAIL SHALL CONSTITUTE
SUFFICIENT NOTICE. NOTHING HEREIN SHALL AFFECT THE RIGHT TO SERVE PROCESS IN ANY
OTHER MANNER PERMITTED BY LAW OR SHALL LIMIT THE RIGHT OF MORTGAGEE TO BRING
PROCEEDINGS AGAINST MORTGAGOR IN THE COURTS OF ANY OTHER JURISDICTION. THE
PLEDGORS HEREBY IRREVOCABLY WAIVE ALL RIGHT TO A TRIAL BY JURY IN ANY ACTION,
PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE
TRANSACTIONS CONTEMPLATED HEREBY.

          SECTION 14.12  Severability of Provisions. Any provision hereof
                         --------------------------
which is prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof or
affecting the validity or enforceability of such provision in any other
jurisdiction.

          SECTION 14.13  Limitation on Interest Payable. It is the intention
                         ------------------------------
of the parties to conform strictly to the usury laws, whether state or Federal,
that are applicable to the transaction of which this Mortgage is a part. All
agreements between the Mortgagor and the Mortgagee whether now existing or
hereafter arising and whether oral or written, are hereby expressly limited so
that in no contingency or event whatsoever shall the amount paid or agreed to be
paid by the Mortgagor for the use, forbearance or detention of the money to be
loaned under the Credit Agreement, any Interest Rate Protection Agreement or any
other Loan Document, or for the payment or performance of any covenant or
obligation contained herein or in the Credit Agreement, any Interest Rate
Protection Agreement or any other Loan Document, exceed the maximum amount
permissible under applicable Federal or state usury laws. If under any
circumstances whatsoever fulfillment of any such provision, at the time
performance of such provision shall be due, shall involve exceeding the limit of
validity prescribed by law, then the obligation to be fulfilled shall be reduced
to the limit of such validity. If under any circumstances the Mortgagor shall
have paid an amount deemed interest by applicable law, which would exceed the
highest lawful rate, such amount that would be excessive interest under
applicable usury laws shall be applied to the reduction of the principal amount
owing in respect of the Secured Obligations and not to the payment of interest,
or if such excessive interest exceeds the unpaid balance of principal and any
other amounts due hereunder, the excess shall be refunded to the Mortgagor. All
sums paid or agreed to be paid for the use, forbearance or deten-
<PAGE>

                                     -42-

tion of the principal under any extension of credit by the Mortgagee shall, to
the extent permitted by applicable law, and to the extent necessary to preclude
exceeding the limit of validity prescribed by law, be amortized, prorated,
allocated and spread from the date hereof until payment in full of the Secured
Obligations so that the actual rate of interest on account of such principal
amounts is uniform throughout the term hereof.

          SECTION 14.14  Business Days. In the event any time period or any
                         -------------
date provided in this Mortgage ends or falls on a day other than a Business Day,
then such time period shall be deemed to end and such date shall be deemed to
fall on the next succeeding Business Day, and performance herein may be made on
such Business Day, with the same force and effect as if made on such other day.

          SECTION 14.15  Relationship. The relationship of the Mortgagee to
                         ------------
the Mortgagor hereunder is strictly and solely that of lender and borrower and
mortgagor and mortgagee and nothing contained in the Credit Agreement, this
Mortgage, any Interest Rate Protection Agreement or any other document or
instrument now existing and delivered in connection therewith or otherwise in
connection with the Secured Obligations is intended to create, or shall in any
event or under any circumstance be construed as creating a partnership, joint
venture, tenancy-in-common, joint tenancy or other relationship of any nature
whatsoever between the Mortgagee and the Mortgagor other than as lender and
borrower and mortgagor and mortgagee.

          SECTION 14.16  Waiver of Stay.
                         --------------

          (i) The Mortgagor agrees that in the event that the Mortgagor or any
property or assets of the Mortgagor shall hereafter become the subject of a
voluntary or involuntary proceeding under the Bankruptcy Code or the Mortgagor
shall otherwise be a party to any Federal or state bankruptcy, insolvency,
moratorium or similar proceeding to which the provisions relating to the
automatic stay under Section 362 of the Bankruptcy Code or any similar provision
in any such law is applicable, then, in any such case, whether or not the
Mortgagee has commenced foreclosure proceedings under this Mortgage, the
Mortgagee shall be entitled to relief from any such automatic stay as it relates
to the exercise of any of the rights and remedies (including, without
limitation, any foreclosure proceedings) available to the Mortgagee as provided
in this Mortgage or in any other Security Document.

         (ii) The Mortgagee shall have the right to petition or move any court
having jurisdiction over any proceeding described in Section 14.16(i) hereof for
                                                     ----------------
the purposes provided therein, and the Mortgagor agrees (i) not to oppose any
such petition or motion and (ii) at the Mortgagor's sole cost and expense, to
assist and cooperate with the Mortgagee, as may be requested by the Mortgagee
from time to time, in obtaining any relief requested by the Mortgagee,
including, without limitation, by filing any such petitions, supplemental
petitions, requests for relief, documents, instruments or other items from time
to time requested by the Mortgagee or any such court.

          SECTION 14.17  No Credit for Payment of Taxes or Impositions. The
                         ---------------------------------------------
Mortgagor shall not be entitled to any credit against the principal, premium, if
any, or interest payable under the Credit Agreement, and the Mortgagor shall not
be entitled to any credit against any other sums which may become payable under
the terms thereof or hereof, by reason of the payment of any Charge on the
Mortgaged Property or any part thereof.
<PAGE>

                                     -43-

          SECTION 14.18  No Claims Against the Mortgagee. Nothing contained
                         -------------------------------
in this Mortgage shall constitute any consent or request by the Mortgagee,
express or implied, for the performance of any labor or services or the
furnishing of any materials or other property in respect of the Premises or any
part thereof, nor as giving the Mortgagor any right, power or authority to
contract for or permit the performance of any labor or services or the
furnishing of any materials or other property in such fashion as would permit
the making of any claim against the Mortgagee in respect thereof or any claim
that any Lien based on the performance of such labor or services or the
furnishing of any such materials or other property is prior to the Lien hereof.

          SECTION 14.19  Obligations Absolute.
                         --------------------

          All obligations of the Mortgagor hereunder shall be absolute and
unconditional irrespective of:

           (i) any bankruptcy, insolvency, reorganization, arrangement,
     readjustment, composition, liquidation or the like of the Mortgagor or any
     other Obligor;

          (ii) any lack of validity or enforceability of the Credit Agreement,
     any Interest Rate Protection Agreement, any Letter of Credit, any other
     Loan Document, or any other agreement or instrument relating thereto;

         (iii) any change in the time, manner or place of payment of, or in
     any other term of, all or any of the Secured Obligations, or any other
     amendment or waiver of or any consent to any departure from the Credit
     Agreement, any Interest Rate Protection Agreement, any Letter of Credit,
     any other Loan Document, or any other agreement or instrument relating
     thereto;

          (iv) any exchange, release or non-perfection of any other collateral,
     or any release or amendment or waiver of or consent to any departure from
     any guarantee, for all or any of the Secured Obligations;

           (v) any exercise or non-exercise, or any waiver of any right, remedy,
     power or privilege under or in respect hereof, any Interest Rate Protection
     Agreement or any other Loan Document except as specifically set forth in a
     waiver granted pursuant to the provisions of Section 14.9 hereof; or
                                                  ------------

          (vi) any other circumstances which might otherwise constitute a
     defense available to, or a discharge of, the Mortgagor.

          SECTION 14.20  Mortgagee's Right To Sever Indebtedness.
                         ---------------------------------------

          (i)  The Mortgagor acknowledges that (A) the Mortgaged Property does
not constitute the sole source of security for the payment and performance of
the Secured Obligations and that the Secured Obligations are also secured by
property of the Mortgagor and its Affiliates in other jurisdictions (all such
property, collectively, the "Collateral"), (B) the number of such jurisdictions
                             ----------
and the nature of the transaction of which this instrument is a part are such
that it would have been impracticable for the parties to allocate to each item
of Collateral a specific loan amount and to execute in respect of such item a
sepa-
<PAGE>

                                     -44-

rate credit agreement or Interest Rate Protection Agreement and (C) the
Mortgagor intends that the Mortgagee have the same rights with respect to the
Mortgaged Property, in foreclosure or otherwise, that the Mortgagee would have
had if each item of Collateral had been secured, mortgaged or pledged pursuant
to a separate credit agreement or Interest Rate Protection Agreement, mortgage
or security instrument.  In furtherance of such intent, the Mortgagor agrees
that the Mortgagee may at any time by notice (an "Allocation Notice") to the
                                                  -----------------
Mortgagor allocate a portion (the "Allocated Indebtedness") of the Secured
                                   ----------------------
Obligations to the Mortgaged Property and sever from the remaining Secured
Obligations the Allocated Indebtedness. From and after the giving of an
Allocation Notice with respect to the Mortgaged Property, the Secured
Obligations hereunder shall be limited to the extent set forth in the Allocation
Notice and (as so limited) shall, for all purposes, be construed as a separate
loan obligation of the Mortgagor unrelated to the other transactions
contemplated by the Credit Agreement, any Interest Rate Protection Agreement,
any other Loan Document or any document related to any thereof. To the extent
that the proceeds on any foreclosure of the Mortgaged Property shall exceed the
Allocated Indebtedness, such proceeds shall belong to the Mortgagor and shall
not be available hereunder to satisfy any Secured Obligations of the Mortgagor
other than the Allocated Indebtedness. In any action or proceeding to foreclose
the Lien hereof or in connection with any power of sale foreclosure or other
remedy exercised under this Mortgage commenced after the giving by the Mortgagee
of an Allocation Notice, the Allocation Notice shall be conclusive proof of the
limits of the Secured Obligations hereby secured, and the Mortgagor may
introduce, by way of defense or counterclaim, evidence thereof in any such
action or proceeding. Notwithstanding any provision of this Section 14.20, the
                                                            -------------
proceeds received by the Mortgagee pursuant to this Mortgage shall be applied by
the Mortgagee in accordance with the provisions of Section 11.3(iii) hereof.
                                                   -----------------

          (ii) The Mortgagor hereby waives to the greatest extent permitted
under law the right to a discharge of any of the Secured Obligations under any
statute or rule of law now or hereafter in effect which provides that
foreclosure of the Lien hereof or other remedy exercised under this Mortgage
constitutes the exclusive means for satisfaction of the Secured Obligations or
which makes unavailable a deficiency judgment or any subsequent remedy because
the Mortgagee elected to proceed with a power of sale foreclosure or such other
remedy or because of any failure by the Mortgagee to comply with laws that
prescribe conditions to the entitlement to a deficiency judgment.  In the event
that, notwithstanding the foregoing waiver, any court shall for any reason hold
that the Mortgagee is not entitled to a deficiency judgment, the Mortgagor shall
not (A) introduce in any other jurisdiction such judgment as a defense to
enforcement against the Mortgagor of any remedy in the Credit Agreement, any
Interest Rate Protection Agreement or any other Loan Document or (B) seek to
have such judgment recognized or entered in any other jurisdiction, and any such
judgment shall in all events be limited in application only to the state or
jurisdiction where rendered.

         (iii) In the event any instrument in addition to the Allocation
Notice is necessary to effectuate the provisions of this Section 14.20,
                                                         -------------
including, without limitation, any amendment to this Mortgage, any substitute
promissory note or affidavit or certificate of any kind, the Mortgagee may
execute, deliver or record such instrument as the attorney-in-fact of the
Mortgagor.  Such power of attorney is coupled with an interest and is
irrevocable.

          (iv) Notwithstanding anything set forth herein to the contrary, the
provisions of this Section 14.20 shall be effective only to the maximum extent
                   -------------
permitted by law.

          SECTION 14.21  Shortened Redemption Election.
                         -----------------------------
<PAGE>

                                     -45-

          Mortgagor agrees to the provisions of Section 846.103 of the Wisconsin
Statutes, or any successor provision, permitting Mortgagee, at its option and
upon waiving the right to judgment for deficiency, to hold a foreclosure sale of
real estate three (3) months after a foreclosure judgment is entered.
<PAGE>

                                     -S1-

          IN WITNESS WHEREOF, the Mortgagor has caused this Mortgage to be duly
executed and delivered under seal the day and year first above written.

                              APW Tools & Supplies, Inc., as Mortgagor

                              By: _______________________________________
                                  Name:
                                  Title:
<PAGE>

                                ACKNOWLEDGMENT

STATE OF _________________ )
                           ) ss.
COUNTY OF ________________ )

          This instrument was acknowledged before me this ____ day of
_______________, 2000, by [________________]  as .[________________________] of
                                                  -
[__________________________].
-                          -

                                    _______________________________(SEAL)
                                    Print Name:__________________________
                                    Notary Public,_______________________
                                    State of ____________________________
                                                     My commission
                                                ________________________
<PAGE>

                                  Schedule A
                                  ----------

                              [Legal Description]
<PAGE>

                                  Schedule B
                                  ----------

Each of the liens and other encumbrances excepted as being prior to the Lien
hereof as set forth in Schedule B to the marked title insurance commitment
                       ----------
issued by First American Title Insurance Company, dated as of the date hereof
and delivered to Collateral Agent on the date hereof, bearing First American
Title Insurance Company reference number000600437 relating to the real property
described in Schedule A attached hereto.
             ----------
<PAGE>

                                   Exhibit 1
                                   ---------

                    FORM OF SUBORDINATION, NON-DISTURBANCE
                           AND ATTORNMENT AGREEMENT

          THIS SUBORDINATION, NON-DISTURBANCE AND ATTORNMENT AGREEMENT (the
"Agreement") is made and entered into as of the ____ day of _______, 2000 by and
between CREDIT SUISSE FIRST BOSTON, a bank organized under the laws of
Switzerland, acting through its New York branch, as collateral agent, having an
office at Eleven Madison Avenue, New York, New York 10010 (in such capacity,
"Collateral Agent"), and _____________________, having an office at
__________________________ ("Tenant").

                               R E C I T A L S:
                               - - - - - - - -

          A.  Tenant is the tenant under a certain lease dated _____________,
____ between ________________________________, as landlord ("Landlord"), and
Tenant, as tenant (as amended through the date hereof, the "Lease"), pursuant to
which Tenant leased a portion (the "Leased Premises") of the property known as
_____________________________, located at _____________________________, as more
particularly described in Schedule A attached hereto (the "Property").
                          ----------

          B.  Landlord has or will grant a mortgage lien on and security
interest in the Property to Collateral Agent (for its benefit and for the
benefit of the lending institutions from time to time party to that certain
credit agreement dated as of July 31, 2000) pursuant to one or more mortgages,
deeds of trust, deeds to secure debt or similar security instruments
(collectively, the "Security Instruments").

          C.  Tenant has agreed to subordinate the Lease to the Security
Instruments and to the lien thereof and Collateral Agent has agreed not to
disturb Tenant's possessory rights in the Leased Premises under the Lease on the
terms and conditions hereinafter set forth.

                              A G R E E M E N T:
                              - - - - - - - - -

          NOW, THEREFORE, the parties hereto mutually agree as follows:

          1.  Subordination.  Notwithstanding anything to the contrary set forth
              -------------
in the Lease, the Lease and the leasehold estate created thereby and all of
Tenant's rights thereunder are and shall at all times be subject and subordinate
in all respects to the Security Instruments and the lien thereof, and to all
rights of Collateral Agent thereunder, and to any and all advances to be made
thereunder, and to all renewals, modifications, consolidations, replacements and
extensions thereof.

          2.  Nondisturbance.  So long as Tenant complies with the provisions of
              --------------
this Agreement, pays all rents and other charges as specified in the Lease and
is not otherwise in default (beyond applicable notice and cure periods) of any
of its obligations and covenants pursuant to the Lease, Collateral Agent agrees
for itself and its successors in interest and for any other person acquiring
title to the Property through a foreclosure (an "Acquiring Party"), that
Tenant's possession of the Leased Premises as described in the Lease will not be
disturbed during the term of the Lease by reason of a foreclosure.  For purposes
of
<PAGE>

                                      -2-

this Agreement, a "foreclosure" shall include (but not be limited to) a
sheriff's or trustee's sale under the power of sale contained in the Security
Instruments, the termination of any superior lease of the Property and any other
transfer of the Landlord's interest in the Property under peril of foreclosure,
including, without limitation to the generality of the foregoing, an assignment
or sale in lieu of foreclosure.

          3.  Attornment.  Tenant agrees to attorn to, accept and recognize any
              ----------
Acquiring Party as the landlord under the Lease pursuant to the provisions
expressly set forth therein for the then remaining balance of the term of the
Lease, and any extensions thereof as made pursuant to the Lease.  The foregoing
provision shall be self-operative and shall not require the execution of any
further instrument or agreement by Tenant as a condition to its effectiveness.

          4.  No Liability. Notwithstanding anything to the contrary contained
              ------------
herein or in the Lease, it is specifically understood and agreed that neither
the Collateral Agent, any receiver nor any Acquiring Party shall be:

          (a) liable for any act, omission, negligence or default of any prior
     landlord (including Landlord); or

          (b) liable for any failure of any prior landlord (including Landlord)
     to construct any improvements or bound by any covenant to construct any
     improvement either at the commencement of the term of the Lease or upon any
     renewal or extension thereof or upon the addition of additional space
     pursuant to any expansion right contained in the Lease; or

          (c) subject to any offsets, credits, claims or defenses which Tenant
     might have against any prior landlord (including Landlord); or

          (d) bound by any rent or additional rent which is payable on a monthly
     basis and which Tenant might have paid for more than one (1) month in
     advance to any prior landlord (including Landlord) or by any security
     deposit or other prepaid charge which Tenant might have paid in advance to
     any prior landlord (including Landlord); or

          (e) liable to Tenant hereunder or under the terms of the Lease beyond
     its interest in the Property; or

          (f) bound by any assignment, subletting, renewal, extension or any
     other agreement or modification of the Lease made without the written
     consent of Collateral Agent; or

          (g) bound by any consensual or negotiated surrender, cancellation or
     termination of the Lease, in whole or in part, agreed upon between Landlord
     and Tenant unless effected unilaterally by Tenant pursuant to the express
     terms of the Lease.

          Notwithstanding the foregoing, Tenant reserves its right to any and
all claims or causes of action (i) against such prior landlord for prior losses
or damages and (ii) against the successor landlord for all losses or damages
arising from and after the date that such successor landlord takes title to the
Property.
<PAGE>

                                      -3-

          5.  Certain Acknowledgments and Agreements by Tenant.  (a) Tenant has
              ------------------------------------------------
notice that the Lease and the rents and all other sums due thereunder have been
assigned to Collateral Agent as security for the notes secured by the Security
Instruments.  In the event Collateral Agent notifies Tenant of the occurrence of
a default under the Security Instruments and demands that Tenant pay its rents
and all other sums due or to become due under the Lease directly to Collateral
Agent, Tenant shall honor such demand and pay its rent and all other sums due
under the Lease directly to Collateral Agent or as otherwise authorized in
writing by Collateral Agent.  Landlord irrevocably authorizes Tenant to make the
foregoing payments to Collateral Agent upon such notice and demand.

          (b) Tenant shall send a copy of any and all notices or statements
under the Lease to Collateral Agent at the same time such notices or statements
are sent to Landlord.

          (c) This Agreement satisfies any and all conditions or requirements in
the Lease relating to the granting of a non-disturbance agreement.

          6.  Collateral Agent to Receive Default Notices. Tenant shall notify
              -------------------------------------------
Collateral Agent of any default by Landlord under the Lease which would entitle
Tenant to cancel the Lease, and agrees that, notwithstanding any provisions of
the Lease to the contrary, no notice of cancellation thereof shall be effective
unless Collateral Agent shall have received notice of default giving rise to
such cancellation and shall have failed within sixty (60) days after receipt of
such notice to cure such default or, if such default cannot be cured within
sixty (60) days, shall have failed within sixty (60) days after receipt of such
notice to commence and thereafter diligently pursue any action necessary to cure
such default.

          7.  Estoppel.  Tenant hereby certifies and represents to Collateral
              --------
Agent that as of the date of this Agreement:

          (a) the Lease is in full force and effect;

          (b) all requirements for the commencement and validity of the Lease
     have been satisfied and there are no unfulfilled conditions to Tenant's
     obligations under the Lease;

          (c) Tenant is not in default under the Lease and has not received any
     uncured notice of any default by Tenant under the Lease; to the best of
     Tenant's knowledge, Landlord is not in default under the Lease; no act,
     event or condition has occurred which with notice or the lapse of time, or
     both, would constitute a default by Tenant or Landlord under the Lease; no
     claim by Tenant of any nature exists against Landlord under the Lease; and
     all obligations of Landlord have been fully performed;

          (d) there are no defenses, counterclaims or setoffs against rents or
     charges due or which may become due under the Lease;

          (e) none of the rent which Tenant is required to pay under the Lease
     has been prepaid, or will in the future be prepaid, more than one (1) month
     in advance;

          (f) Tenant has no right or option contained in the Lease or in any
     other document to purchase all or any portion of the Leased Premises;
<PAGE>

                                      -4-

          (g) the Lease has not been modified or amended and constitutes the
     entire agreement between Landlord and Tenant relating to the Leased
     Premises;

          (h) Tenant has not assigned, mortgaged, sublet, encumbered, conveyed
     or otherwise transferred any or all of its interest under the Lease; and

          (i) Tenant has full authority to enter into this Agreement, which has
     been duly authorized by all necessary action.

          8.  Notices.  All notices or other written communications hereunder
              -------
shall be deemed to have been properly given (i) upon delivery, if delivered in
person with receipt acknowledged by the recipient thereof, (ii) one (1) Business
Day (hereinafter defined) after having been deposited for overnight delivery
with any reputable overnight courier service, or (iii) three (3) Business Days
after having been deposited in any post office or mail depository regularly
maintained by the United States Postal Service and sent by registered or
certified mail, postage prepaid, return receipt requested, addressed to the
receiving party at its address set forth above or addressed as such party may
from time to time designate by written notice to the other parties.  For
purposes of this Section 8, the term "Business Day" shall mean any day other
than Saturday, Sunday or any other day on which banks are required or authorized
to close in New York, New York.  Either party by notice to the other may
designate additional or different addresses for subsequent notices or
communications.

          9.  Successors.  The obligations and rights of the parties pursuant to
              ----------
this Agreement shall bind and inure to the benefit of the successors, assigns,
heirs and legal representatives of the respective parties; provided, however,
                                                           --------  -------
that in the event of the assignment or transfer of the interest of Collateral
Agent, all obligations and liabilities of Collateral Agent under this Agreement
shall terminate, and thereupon all such obligations and liabilities shall be the
responsibility of the party to whom Collateral Agent's interest is assigned or
transferred; and provided, further, that the interest of Tenant under this
                 --------  -------
Agreement may not be assigned or transferred without the prior written consent
of Collateral Agent.  In addition, Tenant acknowledges that all references
herein to Landlord shall mean the owner of the landlord's interest in the Lease,
even if said owner shall be different from the Landlord named in the Recitals.

          10.  Duplicate Original; Counterparts.  This Agreement may be executed
               --------------------------------
in any number of duplicate originals and each duplicate original shall be deemed
to be an original.  This Agreement may be executed in several counterparts, each
of which counterparts shall be deemed an original instrument and all of which
together shall constitute a single Agreement.

          11.  Limitation of Collateral Agent's Liability.  (a)  Collateral
               ------------------------------------------
Agent shall have no obligations nor incur any liability with respect to any
warranties of any nature whatsoever, whether pursuant to the Lease or otherwise,
including, without limitation, any warranties respecting use, compliance with
zoning, Landlord's title, Landlord's authority, habitability, fitness for
purpose or possession.

          (b) In the event that Collateral Agent shall acquire title to the
Leased Premises or the Property, Collateral Agent shall have no obligation, nor
incur any liability, beyond Collateral Agent 's then equity interest, if any, in
the Leased Premises, and Tenant shall look exclusively to such equity interest
of Collateral Agent, if any, in the Leased Premises for the payment and
discharge of any obligations imposed
<PAGE>

                                      -5-

upon Collateral Agent hereunder or under the Lease, and Collateral Agent is
hereby released and relieved of any other obligations hereunder and under the
Lease.

          12.  Modification in Writing.  This Agreement may not be modified
               -----------------------
except by an agreement in writing signed by the parties hereto or their
respective successors in interest.

          13.  Lien of Security Instruments.  Nothing contained in this
               ----------------------------
Agreement shall in any way impair or affect the lien created by the Security
Instruments or the provisions thereof.

          14.  Compliance with Lease.  Tenant agrees that in the event there is
               ---------------------
any inconsistency between the terms and provisions hereof and the terms and
provisions of the Lease, the terms and provisions hereof shall be controlling.

          15.  Governing Law; Severability.  This Agreement shall be governed by
               ---------------------------
the laws of the State of [            ].  If any term of this Agreement or the
application thereof to any person or circumstances shall to any extent be
invalid or unenforceable, the remainder of this Agreement or the application of
such terms to any person or circumstances other than those as to which it is
invalid or unenforceable shall not be affected thereby, and each term of this
Agreement shall be valid and enforceable to the fullest extent permitted by law.

          16.  Further Actions.  Tenant agrees at its own expense to execute and
               ---------------
deliver, at any time and from time to time upon the request of Collateral Agent
or any Acquiring Party, such documents and instruments (in recordable form, if
requested) as may be necessary or appropriate, in the opinion of Collateral
Agent or any Acquiring Party, to fully implement or to further evidence the
understandings and agreements contained in this Agreement.  Moreover, Tenant
hereby irrevocably appoints and constitutes Collateral Agent or any Acquiring
Party as its true and lawful attorney-in-fact to execute and deliver any such
documents or instruments which may be necessary or appropriate, in the opinion
of Collateral Agent or any Acquiring Party, to implement or further evidence
such understandings and agreements and which Tenant, after thirty (30) days'
notice from Collateral Agent or any Acquiring Party, has failed to execute and
deliver.
<PAGE>

          IN WITNESS WHEREOF, Collateral Agent and Tenant have duly executed
this Agreement as of the date first above written.

                              CREDIT SUISSE FIRST BOSTON,

                              as Collateral Agent

                              By: ______________________________________
                                  Name:
                                  Title:

                              __________________________________________,
                              as Tenant

                              By: ______________________________________
                                  Name:
                                  Title:

          The undersigned, as the Landlord named in the Recitals, having duly
executed this Agreement as of the date first written above, and as mortgagor,
pledgor, assignor or debtor under the Security Instruments, hereby accepts and
agrees for itself and its successors and assigns, (i) to be bound by the
provisions of Section 5 hereof, (ii) that nothing contained in the foregoing
Agreement (x) shall in any way be deemed to constitute a waiver by Collateral
Agent of any of its rights or remedies under the Security Instruments or (y)
shall in any way be deemed to release Landlord from its obligations to comply
with the terms, provisions, conditions, covenants and agreements set forth in
the Security Instruments and (iii) that the provisions of the Security
Instruments remain in full force and effect and must be complied with by
Landlord.

                              ________________________________, a
                              ________________________________

                              By: ______________________________________
                                  Name:
                                  Title:
<PAGE>

                                ACKNOWLEDGMENT

State of New York  )
                   ) ss.:
County of New York )

          On the ___ day of _____ in the year ____ before me, the undersigned, a
Notary Public in and for said State, personally appeared _____________,
personally known to me or proved to me on the basis of satisfactory evidence to
be the individual(s) whose name(s) is (are) subscribed to the within instrument
and acknowledged to me that he/she/they executed the same in his/her/their
capacity(ies), and that by his/her/their signature(s) on the instrument, the
individual(s), or the person upon behalf of which the individual(s) acted,
executed the instrument.

                              ____________________________________________
                                             (Signature)
<PAGE>

                            SCHEDULE A to EXHIBIT 1
                            -----------------------

                         Description of Real Property
                         ----------------------------

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