Document:

exv10w2

 

Exhibit 10.2

*Confidential Treatment Requested Under

17 C.F.R. §§ 200.80(b)(4), 200.83 and 240.24b-2

DEVELOPMENT FUNDING AGREEMENT

     This Development Funding Agreement (this “Agreement”) is entered into on November 7, 2006
(“Effective Date”) between AKORN, INC., a Louisiana corporation having a principal place of
business at 2500 Millbrook Drive, Buffalo Grove, Illinois 60089-4694, United States of America
(“AKORN”) and SERUM INSTITUTE of INDIA, LTD., a Company incorporated under the laws of India laws,
having its principal place of business at S. No. 212/2, Off Soli Poonawalla Road, Hadapsar, Pune —
411 028, Maharashtra, INDIA, (“SII”) (each a “Party” and collectively, the “Parties”).

     A. The Parties have entered into a Development and Exclusive Distribution Agreement of even
date (“Distribution Agreement”) that provides for the grant to AKORN of exclusive marketing and
distribution rights in North, Central and South America for the rabies monoclonal antibody
(“Product”); and

     B. In connection with the Distribution Agreement, the Parties desire to set forth their
agreement with respect to development funding payments to be paid to SII in respect of Product
development, pursuant to the term and conditions set forth below.

     NOW, THEREFORE, in consideration of the mutual promises herein, and other valuable
consideration, the receipt and sufficiency of which are hereby acknowledged by the Parties, the
Parties agree as follows:

ARTICLE 1

DEFINITIONS

     1.1 All capitalized terms used herein shall have the same meanings set forth in the
Distribution Agreement, unless otherwise defined in this Amendment.

     1.2 Distribution Agreement. The term “Distribution Agreement” has the meaning
ascribed to it in the Recitals above.

     1.3 Payments. The term “Payments” means the payments set forth on the Payment
Schedule, that are due and payable to SII as provided herein.

     1.4 Payment Schedule. The term “Payment Schedule” means the payment schedule, set
forth in Exhibit A, attached hereto and fully incorporated herein.

     1.5 Triggering Event. The term “Triggering Events” means the objectives and
deliverables described and set forth in the Payment Schedule.

ARTICLE 2

MILESTONE PAYMENTS

     2.1 Payments. AKORN shall pay to SII the corresponding Payment within ten (10)
calendar days the Parties’ reasonable verification that a specific Triggering Event has occurred.

* CONFIDENTIAL TREATMENT REQUESTED — This language has been omitted and filed separately with
the Securities and Exchange Commission.

 

 

*Confidential Treatment Requested Under

17 C.F.R. §§ 200.80(b)(4), 200.83 and 240.24b-2

     2.2 U.S. Dollars. All payments to be made pursuant to this Agreement shall be
in United States Dollars.

     2.3 Late Payments. Any late payments hereunder shall be subject to annual interest at
the rate of ten percent (10%) compounded on a monthly basis, until paid in full.

ARTICLE 3

WARRANTIES

     3.1 Representations and Warranties. Each of AKORN and SII represents, warrants and
covenants that it has the full power, right and authority to execute and deliver this Agreement and
perform its obligations hereunder.

     3.2 Limitation of Liability. NOTWITHSTANDING ANYTHING TO THE CONTRARY HEREIN, NEITHER
PARTY SHALL BE LIABLE FOR ANY INDIRECT, SPECIAL, INCIDENTAL, CONSEQUENTIAL, PUNITIVE, OR EXEMPLARY
DAMAGES, WHETHER FORESEEABLE OR NOT, THAT ARE IN ANY WAY RELATED TO THIS AGREEMENT.

ARTICLE 4

TERMINATION

     4.1 Term. This Agreement shall commence on the Effective Date and shall continue for
so long as the Distribution Agreement remains in full force and effect, unless earlier terminated
under Section 4.2.

     4.2 Termination. This Agreement will terminate:

            4.2.1 on the thirtieth (30th) calendar day after SII gives written notice to AKORN of a
material breach by AKORN of any term or condition of this Agreement, unless the breach is cured
before the thirtieth (30th) calendar day; or

            4.2.2 automatically and immediately upon any termination of the Distribution Agreement.

     4.3 Effect of Termination.

            4.3.1 In the event of termination all Parties shall remain liable for each of their respective
obligations hereunder that accrued prior to the date of termination.

            4.3.2 All rights and remedies conferred herein shall be cumulative and in addition to all of
the rights and remedies available to each Party at law, equity or otherwise.

            4.3.3 Upon any termination of the Distribution Agreement solely as a result of [...***...]’s
material breach of the Collaboration Agreement, then SII shall promptly repay to AKORN, without
interest, fifty percent (50%) of all Payments paid by AKORN to SII other than

* CONFIDENTIAL TREATMENT REQUESTED — This language has been omitted and filed separately with
the Securities and Exchange Commission.

Page 2

 

*Confidential Treatment Requested Under

17 C.F.R. §§ 200.80(b)(4), 200.83 and 240.24b-2

the nonrefundable
amount indicated on Exhibit A. Upon any termination of the Distribution Agreement prior to CBER
approval for Product sales solely as a result of SII’s material breach of the Distribution
Agreement or the Collaboration Agreement or in the event SII permanently stops developing Product
under the Collaboration Agreement, then SII shall promptly repay to AKORN, without interest, fifty
percent (50%) of all Payments paid by AKORN to SII other than the nonrefundable amount indicated on
Exhibit A. This Section 4.3.3 shall be of no force or effect in the event of the termination of
the Distribution Agreement or this Agreement due to a material breach by AKORN. Upon any such
termination of the Distribution Agreement or this Agreement due to a material breach by AKORN, SII
shall have no liability to repay to AKORN any of the Payments, in whole or in part. Subject to the
immediately prior sentence, to the extent that SII appoints any other party as distributor for
Products in the Territory, then SII shall promptly repay to AKORN, without interest, one hundred
percent (100%) all Payments paid by AKORN to SII other than the nonrefundable amount indicated on
Exhibit A (and any amounts previously refunded by SII under this Section 4.3.3), subject to the
amortisation schedule stated in 4.3.4.

            4.3.4 Should SII appoint any other party as distributor for Products in the Territory, then
the amount payable by SII under Section 4.3.3 shall be adjusted such that SII is only required to
pay based on the unamortized balance of the Payments paid by AKORN to SII (other than the
nonrefundable amount indicated on Exhibit A) based upon a twenty (20) year amortization schedule
beginning on the date of CBER approval for Product.

ARTICLE 5

GENERAL TERMS

     5.1 Relationship of Parties. The relationship between SII and AKORN, with respect to
this Agreement, is only that of independent contractors notwithstanding any activities set forth in
this Agreement. Neither Party is the agent or legal representative of the other Party, and neither
Party has the right or authority to bind the other Party in any way. This Agreement creates no
relationship as partners or a joint venture, and creates no pooling arrangement.

     5.2 Confidentiality. This Agreement hereby incorporates the confidentiality
provisions of the Distribution Agreement, including Section 8.2 thereof. For the sake of clarity,
the terms of this Agreement will be kept confidential by the parties, except as permitted under the
exceptions set forth in Sections 8.2.1 — 8.2.6 of the Distribution Agreement.

     5.3 Governing Law; Dispute Resolution. This Agreement is governed by and shall be
construed in accordance with the law of the State of New York, excluding any conflict-of-laws rule
or principle that might refer the governance or the construction of this Agreement to the law of
another jurisdiction. Each Party hereby agrees to resolve all disputes between the Parties
relating to this Agreement in accordance with the mediation and arbitration provisions set forth in
the Distribution Agreement.

     5.4 Counterparts. This Agreement may be executed in several counterparts that
together shall be originals and constitute one and the same instrument.

* CONFIDENTIAL TREATMENT REQUESTED — This language has been omitted and filed separately with
the Securities and Exchange Commission.

Page 3

 

*Confidential Treatment Requested Under

17 C.F.R. §§ 200.80(b)(4), 200.83 and 240.24b-2

     5.5 Waiver. The failure of any Party to enforce any of its rights hereunder or at law
shall not be deemed a waiver or a continuing waiver of any of its rights or remedies against
another Party, unless such waiver is in writing and signed by the Party to be charged.

     5.6 Severability. If any provision of this Agreement, or part thereof, is declared by
a court of competent jurisdiction to be invalid, void or unenforceable, each and every other
provision, or part thereof, shall nevertheless continue in full force and effect.

     5.7 Attorneys’ Fees. In the event that any dispute between the Parties should result
in litigation or arbitration, the prevailing Party in such dispute shall be entitled to recover
from the other Party all reasonable fees, costs and expenses of enforcing any right of the
prevailing Party, including reasonable attorneys’ fees and expenses.

     5.8 Notice. Any notice given under this Agreement shall be in writing and shall be
delivered personally or by reputable international 3-day courier. Notices may also be delivered by
fax transmittal or email (with valid confirmation of successful transmission), with confirmation
sent by reputable international 3-day courier. A notice shall be deemed delivered upon receipt,
unless the notice is received on a day other than a business day in the jurisdiction of the
recipient or after 5:30 p.m. at the location of delivery, in which case delivery shall be deemed to
be the next business day after receipt (in the jurisdiction of recipient). Notices shall be
directed to Parties at their addresses as specified on page 1 of this Agreement, provided a Party
may change such Party’s address for notice by giving written notice to the other Party in
accordance with this Section. Fax numbers and emails for notices shall be exchanged by the Parties
prior to reaching the first Triggering Event and shall be updated by the Parties as needed
thereafter.

     5.9 Entire Agreement. This Agreement constitutes the entire agreement between the
Parties regarding the subject matter hereof, and supersedes all prior or contemporaneous
understandings or agreements regarding the subject matter hereof, whether oral or written. This
Agreement shall be modified or amended only by a writing signed by both AKORN and SII.

     5.10 Authority. The Parties executing this Agreement on behalf of AKORN and SII
represent and warrant that they have the authority from their respective governing bodies to enter
into this Agreement and to bind their respective companies to all the terms and conditions of this
Agreement.

     5.11 Captions. The captions of the Articles and Sections in this Agreement are for
convenience only and shall not be used to interpret the provisions of this Agreement.

     5.12 English Language. This Agreement is executed in the English language. The
language used in this Agreement shall be deemed to be the language chosen by the Parties hereto to
express their mutual intent and no rule of strict construction against either Party shall apply to
any term or condition of this Agreement.

     5.13 Headings and Construction. No rule of construction will be applied to the
disadvantage of a Party because that Party was responsible for the preparation of this Agreement

* CONFIDENTIAL TREATMENT REQUESTED — This language has been omitted and filed separately with
the Securities and Exchange Commission.

Page 4

 

*Confidential Treatment Requested Under

17 C.F.R. §§ 200.80(b)(4), 200.83 and 240.24b-2

or
any part of this Agreement. The Article and Section headings in this Agreement are for convenient
reference only, and will be given no substantive or interpretive effect. With respect to all terms
used in this Agreement, words used in the singular include the plural and words used in the plural
include the singular. The word ‘including’ means including without limitation, and the words
‘herein’, ‘hereby’, ‘hereto’ and ‘hereunder’ refer to this Agreement as a whole. Unless the
context otherwise requires, references found in this Agreement: (i) to Articles and Sections mean
the Articles and Sections of this Agreement; (ii) to an agreement, instrument or other document
means such agreement, instrument or other document as amended, supplemented and modified from time
to time, to the extent provided by the provisions thereof and by this Agreement; and (iii) to a
statute or a regulation mean such statute or regulation as amended from time to time.

     IN WITNESS WHEREOF, the Parties have executed this Agreement as of the Effective Date.

	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	Akorn, Inc.	 	Serum Institute Of India, Ltd.
	 
	 	 	 	 	 	 	 	 	 	 
	By:

	 	/s/ Arthur S. Przybyl
	 	By:
	 	/s/ Subhash V. Kapre	 	 	 	 
	 

	 	 
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	Name:

	 	Arthur S. Przybyl
	 	Name:
	 	Subhash V. Kapre	 	 	 	 
	 

	 	 
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	Title:

	 	President and CEO
	 	Title:
	 	Executive Director	 	 	 	 
	 

	 	 
	 	 	 	 	 	 	 	 

* CONFIDENTIAL TREATMENT REQUESTED — This language has been omitted and filed separately with
the Securities and Exchange Commission.

Page 5

 

*Confidential Treatment Requested Under

17 C.F.R. §§ 200.80(b)(4), 200.83 and 240.24b-2

EXHIBIT A

PAYMENT SCHEDULE

FOR [...***...]

	 	 	 	 	 
	 
	 	 	 	 
	 
	 

	 	Triggering Event
	 	Payment
	 
	1.

	 	Execution of this Agreement
	 	[...***...]
	 
	2.

	 	January 1, 2007
	 	[...***...], which
amount is
non-refundable
notwithstanding
Section 4.3
	 
	3.

	 	Clinical Batch manufacture of [...***...]
	 	[...***...]
	 
	4.

	 	Satisfactory Completion of Phase I Clinical Trials
for [...***...] for U.S. filing
	 	[...***...]
	 
	5.

	 	Satisfactory Completion of Phase II Clinical Trials
for [...***...] for U.S. filing
	 	[...***...]
	 
	6.

	 	Satisfactory Completion of Phase III Clinical
Trials for [...***...] for U.S. filing
	 	AKORN to reimburse
SII for all actual
direct costs of
Phase III Clinical
Trials conducted
pursuant to budget
approved by
AKORNf
	 
	6.

	 	Receipt of CBER approval for [...***...]
	 	[...***...]
	 

 

			
	f Budget for Phase III Clinical Trial must be
approved in writing by AKORN prior to commencement of Phase III Clinical Trial.
Following FDA approval of protocol, SII shall submit a budget to AKORN and
shall negotiate in good faith with AKORN to resolve any AKORN objections to
such budget. Once the budget for Phase III Clinical Trial is approved by AKORN
in writing, SII shall not deviate from such budget without obtaining
AKORN’s written approval.

* CONFIDENTIAL TREATMENT REQUESTED — This language has been omitted and filed separately with
the Securities and Exchange Commission.

Page 6exv10w1

 

EXHIBIT
10.1

EXECUTION COPY

 

AMENDED AND RESTATED FIVE-YEAR REVOLVING CREDIT AGREEMENT

dated as of

October 11, 2001

As Amended and Restated as of

August 29, 2006

among

LAND O’LAKES, INC.,

as Borrower

The Lenders Party Hereto

and

JPMORGAN CHASE BANK, N.A.,

as Administrative Agent and Collateral Agent

and

COBANK, ACB,

as Co-Administrative Agent

 

J.P. MORGAN SECURITIES INC.,

as Sole Lead Arranger and Sole Bookrunner

 

 

 

TABLE OF CONTENTS

	 	 	 	 	 
	ARTICLE I	 
	 
	 	 	 	 
	Definitions	 
	 
	 	 	 	 
	SECTION 1.01. Defined Terms
	 	 	1	 
	SECTION 1.02. Classification of Loans and Borrowings
	 	 	24	 
	SECTION 1.03. Terms Generally
	 	 	24	 
	SECTION 1.04. Accounting Terms; GAAP; Pro Forma Calculations
	 	 	24	 
	 
	 	 	 	 
	ARTICLE II	 
	 
	 	 	 	 
	The Credits	 
	 
	 	 	 	 
	SECTION 2.01. Commitments
	 	 	25	 
	SECTION 2.02. Loans and Borrowings
	 	 	25	 
	SECTION 2.03. Requests for Borrowings
	 	 	26	 
	SECTION 2.04. Letters of Credit
	 	 	26	 
	SECTION 2.05. Funding of Borrowings
	 	 	30	 
	SECTION 2.06. Interest Elections
	 	 	31	 
	SECTION 2.07. Termination and Reduction of Commitments
	 	 	32	 
	SECTION 2.08. Repayment of Loans; Evidence of Debt
	 	 	33	 
	SECTION 2.09. Prepayment of Loans
	 	 	33	 
	SECTION 2.10. Fees
	 	 	34	 
	SECTION 2.11. Interest
	 	 	35	 
	SECTION 2.12. Alternate Rate of Interest
	 	 	35	 
	SECTION 2.13. Increased Costs
	 	 	36	 
	SECTION 2.14. Break Funding Payments
	 	 	37	 
	SECTION 2.15. Taxes
	 	 	37	 
	SECTION 2.16. Payments Generally; Pro Rata Treatment; Sharing of Set-offs
	 	 	38	 
	SECTION 2.17. Mitigation Obligations; Replacement of Lenders
	 	 	40	 
	SECTION 2.18. Increase in Commitments
	 	 	41	 
	 
	 	 	 	 
	ARTICLE III 	 
	 
	 	 	 	 
	Representations and Warranties	 
	 
	 	 	 	 
	SECTION 3.01. Organization; Powers
	 	 	42	 
	SECTION 3.02. Authorization; Enforceability
	 	 	42	 
	SECTION 3.03. Governmental Approvals; No Conflicts
	 	 	42	 
	SECTION 3.04. Financial Condition; No Material Adverse Change
	 	 	42	 

 

 

 ii

	 	 	 	 	 
	SECTION 3.05. Properties
	 	 	43	 
	SECTION 3.06. Litigation and Environmental Matters
	 	 	43	 
	SECTION 3.07. Compliance with Laws and Agreements
	 	 	44	 
	SECTION 3.08. Investment Company Status
	 	 	44	 
	SECTION 3.09. Taxes
	 	 	44	 
	SECTION 3.10. ERISA
	 	 	44	 
	SECTION 3.11. Disclosure
	 	 	44	 
	SECTION 3.12. Subsidiaries
	 	 	45	 
	SECTION 3.13. Insurance
	 	 	45	 
	SECTION 3.14. Labor Matters
	 	 	45	 
	SECTION 3.15. Solvency
	 	 	45	 
	SECTION 3.16. Patronage Payments
	 	 	45	 
	 
	 	 	 	 
	ARTICLE IV	 	 	 
	 
	 	 	 	 
	Conditions	 	 	 
	 
	 	 	 	 
	SECTION 4.01. Effective Date
	 	 	45	 
	SECTION 4.02. Each Credit Event
	 	 	47	 
	 
	 	 	 	 
	ARTICLE V	 	 	 
	 
	 	 	 	 
	Affirmative Covenants	 	 	 
	 
	 	 	 	 
	SECTION 5.01. Financial Statements and Other Information
	 	 	48	 
	SECTION 5.02. Notices of Material Events
	 	 	49	 
	SECTION 5.03. Information Regarding Collateral
	 	 	50	 
	SECTION 5.04. Existence; Conduct of Business
	 	 	51	 
	SECTION 5.05. Payment of Obligations
	 	 	51	 
	SECTION 5.06. Maintenance of Properties
	 	 	51	 
	SECTION 5.07. Insurance
	 	 	51	 
	SECTION 5.08. Casualty and Condemnation
	 	 	51	 
	SECTION 5.09. Books and Records; Inspection and Audit Rights
	 	 	51	 
	SECTION 5.10. Compliance with Laws
	 	 	52	 
	SECTION 5.11. Use of Proceeds and Letters of Credit
	 	 	52	 
	SECTION 5.12. Additional Subsidiaries
	 	 	52	 
	SECTION 5.13. Further Assurances
	 	 	52	 

 

 

 iii

	 	 	 	 	 
	ARTICLE VI	 	 	 
	 
	 	 	 	 
	Negative Covenants	 	 	 
	 
	 	 	 	 
	SECTION 6.01. Indebtedness; Certain Equity Securities
	 	 	53	 
	SECTION 6.02. Liens
	 	 	55	 
	SECTION 6.03. Fundamental Changes
	 	 	56	 
	SECTION 6.04. Investments, Loans, Advances, Guarantees and Acquisitions
	 	 	56	 
	SECTION 6.05. Asset Sales
	 	 	58	 
	SECTION 6.06. Sale and Leaseback Transactions
	 	 	59	 
	SECTION 6.07. Hedging Agreements
	 	 	59	 
	SECTION 6.08. Restricted Payments; Certain Payments of Indebtedness
	 	 	59	 
	SECTION 6.09. Transactions with Affiliates
	 	 	61	 
	SECTION 6.10. Restrictive Agreements
	 	 	61	 
	SECTION 6.11. Amendment of Material Documents
	 	 	62	 
	SECTION 6.12. Interest Expense Coverage Ratio
	 	 	62	 
	SECTION 6.13. Leverage Ratio
	 	 	62	 
	 
	 	 	 	 
	ARTICLE VII	 	 	 
	 
	 	 	 	 
	Events of Default	 	 	 
	 
	 	 	 	 
	ARTICLE VIII	 	 	 
	 
	 	 	 	 
	The Agents	 	 	 
	 
	 	 	 	 
	ARTICLE IX 	 	 	 
	 
	 	 	 	 
	Miscellaneous 	 	 	 
	 
	 	 	 	 
	SECTION 9.01. Notices
	 	 	66	 
	SECTION 9.02. Waivers; Amendments
	 	 	67	 
	SECTION 9.03. Expenses; Indemnity; Damage Waiver
	 	 	68	 
	SECTION 9.04. Successors and Assigns
	 	 	70	 
	SECTION 9.05. Survival
	 	 	72	 
	SECTION 9.06. Counterparts; Integration; Effectiveness
	 	 	72	 
	SECTION 9.07. Severability
	 	 	72	 
	SECTION 9.08. Right of Setoff
	 	 	73	 
	SECTION 9.09. Governing Law; Jurisdiction; Consent to Service of Process
	 	 	73	 

 

 

 iv

	 	 	 	 	 
	SECTION 9.10. WAIVER OF JURY TRIAL
	 	 	73	 
	SECTION 9.11. Headings
	 	 	74	 
	SECTION 9.12. Confidentiality
	 	 	74	 
	SECTION 9.13. Interest Rate Limitation
	 	 	75	 
	SECTION 9.14. Optional Release of Collateral
	 	 	75	 
	SECTION 9.15. USA Patriot Act Notice
	 	 	77	 

SCHEDULES:

	 	 	 	 	 	 	 
	 

	 	Schedule 1.01(a)
	 	—
	 	Subsidiary Loan Parties
	 

	 	Schedule 1.01(b)
	 	—
	 	Mortgaged Property
	 

	 	Schedule 1.01(c)
	 	—
	 	Existing Letters of Credit
	 

	 	Schedule 2.01
	 	—
	 	Lenders and Commitments
	 

	 	Schedule 3.05
	 	—
	 	Owned and Leased Real Property
	 

	 	Schedule 3.06
	 	—
	 	Disclosed Matters
	 

	 	Schedule 3.12
Schedule 3.13
	 	—
—
	 	Subsidiaries

Insurance
	 

	 	Schedule 6.01
	 	—
	 	Existing Indebtedness
	 

	 	Schedule 6.02
	 	—
	 	Existing Liens
	 

	 	Schedule 6.04
	 	—
	 	Existing Investments
	 

	 	Schedule 6.05(c)
	 	—
	 	Certain Asset Sales
	 

	 	Schedule 6.10
	 	—
	 	Restrictive Agreements

EXHIBITS:

	 	 	 	 	 	 	 
	 

	 	Exhibit A
	 	—
	 	Form of Assignment and Acceptance
	 

	 	Exhibit B-1
	 	—
	 	Form of Opinion of Borrower’s Outside Counsel
	 

	 	Exhibit B-2
	 	—
	 	Form of Opinion of Borrower’s General Counsel
	 

	 	Exhibit C
	 	—
	 	Guarantee and Collateral Agreement
	 

	 	Exhibit D
	 	—
	 	Perfection Certificate
	 

	 	Exhibit E
	 	—
	 	Form of Accession Agreement
	 

	 	Exhibit F
	 	—
	 	Form of Promissory Note

 

 

     AMENDED AND RESTATED FIVE-YEAR REVOLVING CREDIT AGREEMENT dated as of
October 11, 2001, as amended and restated as of August 29, 2006 among LAND
O’LAKES, INC., the LENDERS party hereto, JPMORGAN CHASE BANK, N.A., as
Administrative Agent, and COBANK, ACB, as Co-Administrative Agent.

          The Borrower (such term and each other capitalized term used and not otherwise defined herein
having the meaning assigned to it in Article I), certain of the Lenders, the Administrative Agent
and the Co-Administrative Agent are parties to an Amended and Restated Five-Year Credit Agreement
dated as of October 11, 2001 (the “Existing Credit Agreement”). The Borrower has requested
the Lenders amend and restate the Existing Credit Agreement in the form of this Agreement and,
pursuant to the terms hereof, agree to extend credit to enable the Borrower to borrow on a
revolving credit basis on and after the date hereof and at any time and from time to time prior to
the Maturity Date a principal amount not in excess of $225,000,000 at any time outstanding, subject
to increase as provided in Section 2.18. The Borrower has further requested the Issuing Banks
agree to issue Letters of Credit in an aggregate face amount at any time outstanding not in excess
of $75,000,000 to support payment obligations of the Borrower and the Subsidiaries.

          The Lenders are willing to amend and restate the Existing Credit Agreement in the form of this
Agreement and to extend such credit to the Borrower on the terms and conditions hereof.
Accordingly, the parties hereto agree as follows:

ARTICLE I

Definitions

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

          “ABR”, when used in reference to any Loan or Borrowing, refers to whether such Loan,
or the Loans comprising such Borrowing, are bearing interest at a rate determined by reference to
the Alternate Base Rate.

          “Accession Agreement” shall mean an Accession Agreement substantially in the form of
Exhibit E hereto among a Prospective Lender, the Borrower and the Administrative Agent.

          “Account” has the meaning assigned to such term in the Collateral Agreement.

          “Account Assets” means, collectively, with respect to Accounts or CoBank Accounts (as
defined in the Collateral Agreement), as the case may be, all such Accounts or CoBank Accounts,
together with (a) all right, title and interest in and to all contracts that relate to any of such
accounts; (b) all security interests or liens and property subject thereto from time to time
purporting to secure payment of any of such accounts, whether pursuant to the contracts related to
such accounts or otherwise; (c) all UCC financing statements covering any collateral securing
payment of any of such accounts; (d) all guarantees and other agreements or arrangements of
whatever character from time to time supporting or securing payment
of any of such accounts whether pursuant to the contracts related to any of such accounts or otherwise;
(e) all interest in the merchandise, goods, products or other property (including any that is
returned), if any, the sale of which gave rise to any of such accounts; and (f) all proceeds of the
foregoing.

 

 

 2

          “Adjusted LIBO Rate” means, with respect to any Eurodollar Borrowing for any Interest
Period, an interest rate per annum (rounded upwards, if necessary, to the next 1/16 of 1%) equal to
(a) the LIBO Rate for such Interest Period multiplied by (b) the Statutory Reserve Rate.

          “Administrative Agent” means JPMorgan Chase Bank, N.A., in its capacity as
administrative agent for the Lenders hereunder.

          “Administrative Questionnaire” means an Administrative Questionnaire in a form
supplied by the Co-Administrative Agent, copies of each of which shall be delivered by the
Co-Administrative Agent to the Borrower.

          “Affiliate” means, with respect to a specified Person, another Person that directly,
or indirectly through one or more intermediaries, Controls or is Controlled by or is under common
Control with the Person specified.

          “Agents” means, JPMorgan Chase Bank, N.A., in its capacities as Administrative Agent
and Collateral Agent under the Loan Documents and CoBank in its capacity as Co-Administrative Agent
under the Loan Documents.

          “Alternate Base Rate” means, for any day, a rate per annum equal to the greater of (a)
the Prime Rate in effect on such day and (b) the Federal Funds Effective Rate in effect on such day
plus 1/2 of 1%. Any change in the Alternate Base Rate due to a change in the Prime Rate or the
Federal Funds Effective Rate shall be effective from and including the effective date of such
change in the Prime Rate or the Federal Funds Effective Rate, respectively.

          “Applicable Percentage” means, with respect to any Lender, the percentage of the total
Commitments represented by such Lender’s Commitment. If the Commitments have terminated or
expired, the Applicable Percentages shall be determined based upon the respective amounts of the
Lenders’ Revolving Exposures.

          “Applicable Rate” means, for any day with respect to any Eurodollar Loan, ABR Loan, or
with respect to the commitment fees payable hereunder, as the case may be, the applicable rate per
annum set forth below under the caption “Eurodollar Spread”, “ABR Spread” or “Commitment Fee”, as
the case may be, based upon the Leverage Ratio as of the most recent date of determination:

 

 

 3

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	Leverage	 	Eurodollar	 	 	 	 	 	Commitment
	 	 	Ratio	 	Spread	 	ABR Spread	 	Fee
	Category 1

	 	greater than 2.50
to 1.00
	 	 	1.50	%	 	 	0.50	%	 	 	0.375	%
	Category 2

	 	greater than 1.50
to 1.00 but less
than or equal to
2.50 to 1.00
	 	 	1.25	%	 	 	0.25	%	 	 	0.250	%
	Category 3

	 	less than or equal
to 1.50 to 1.00
	 	 	0.875	%	 	 	0.00	%	 	 	0.200	%

          For purposes of the foregoing, (i) the Leverage Ratio shall be determined as of the end of
each fiscal quarter of the Borrower’s fiscal year based upon the consolidated financial statements
delivered pursuant to Section 5.01(a) or (b) and (ii) each change in the Applicable Rate resulting
from a change in the Leverage Ratio shall be effective during the period commencing on and
including the date of delivery of such consolidated financial statements indicating such change and
ending on the date immediately preceding the effective date of the next such change;
provided that the Leverage Ratio shall be deemed to be in Category 2 until such time as the
Borrower delivers the first consolidated financial statements after the Effective Date required to
be delivered by Section 5.01(a) or (b); provided, however, that notwithstanding the
foregoing, the Leverage Ratio shall be deemed to be in Category 1 (A) at any time that an Event of
Default has occurred and is continuing or (B) if the Borrower fails to deliver the consolidated
financial statements required to be delivered by it pursuant to Section 5.01(a) or (b), during the
period from the expiration of the time for delivery thereof until such consolidated financial
statements are delivered.

          “Assignment and Acceptance” means an assignment and acceptance entered into by a
Lender and an assignee (with the consent of any party whose consent is required by Section 9.04),
and accepted by the Co-Administrative Agent, in the form of Exhibit A or any other form approved by
the Co-Administrative Agent.

          “Attributable Debt” means, on any date, in respect of any lease of the Borrower or any
Restricted Subsidiary entered into as part of a sale and leaseback transaction subject to Section
6.06, (i) if such lease is a Capital Lease Obligation, the capitalized amount thereof that would
appear on a balance sheet of such Person prepared as of such date in accordance with GAAP, and (ii)
if such lease is not a Capital Lease Obligation, the capitalized amount of the remaining lease
payments under such lease that would appear on a balance sheet of such Person prepared as of such
date in accordance with GAAP if such lease were accounted for as a Capital Lease Obligation.

          “Availability Period” means the period from and including the Effective Date to but
excluding the earlier of the Maturity Date and the date of termination of the Commitments.

          “Board” means the Board of Governors of the Federal Reserve System of the United
States of America.

          “Borrower” means Land O’Lakes, Inc., a Minnesota cooperative corporation.

          “Borrowing” means Loans of the same Type, made, converted or continued on the same
date and, in the case of Eurodollar Loans, as to which a single Interest Period is in effect.

 

 

 4

          “Borrowing Request” means a request by the Borrower for a Borrowing in accordance with
Section 2.03.

          “Business Day” means any day that is not a Saturday, Sunday or other day on which
commercial banks in New York City are authorized or required by law to remain closed;
provided that, when used in connection with a Eurodollar Loan, the term “Business
Day” shall also exclude any day on which banks are not open for dealings in dollar deposits in
the London interbank market.

          “Calculation Period” means, with respect to any Payment Date, the period commencing on
July 1, 2006 and ending on and including such Payment Date.

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

          “Capital Securities” means the trust preferred securities in aggregate face amount of
up to $200,000,000 issued on March 25, 1998, pursuant to the Indenture dated as of March 25, 1998,
between the Borrower and Wilmington Trust Company.

          “Change in Control” means the acquisition of ownership, directly or indirectly,
beneficially or of record, by any Person or group (within the meaning of the Securities Exchange
Act of 1934 and the rules of the Securities and Exchange Commission thereunder as in effect on the
date hereof), of membership interests representing more than 50% of the aggregate ordinary voting
power represented by all outstanding membership interests of the Borrower.

          “Change in Law” means (a) the adoption of any law, rule or regulation after the date
of this Agreement, (b) any change in any law, rule or regulation or in the interpretation or
application thereof by any Governmental Authority after the date of this Agreement or (c)
compliance by any Lender or any Issuing Bank (or, for purposes of Section 2.13(b), by any lending
office of such Lender or by such Lender’s or such Issuing Bank’s holding company, if any) with any
request, guideline or directive (whether or not having the force of law) of any Governmental
Authority made or issued after the date of this Agreement.

          “Code” means the Internal Revenue Code of 1986, as amended from time to time.

          “Co-Administrative Agent” means CoBank, in its capacity as co-administrative agent for
the Lenders hereunder.

          “CoBank” means CoBank, ACB, a federally chartered instrumentality of the United
States.

          “Collateral” means any and all “Collateral”, as defined in any applicable Security
Document.

 

 

 5

          “Collateral Agent” means JPMorgan Chase Bank, N.A. in its capacity as collateral agent
for the Lenders under the Security Documents.

          “Collateral Agreement” means the Guarantee and Collateral Agreement among the
Borrower, the Subsidiary Loan Parties and the Collateral Agent, substantially in the form of
Exhibit C.

          “Collateral and Guarantee Requirement” means, at any time, if a Collateral Release
Period is not in effect, the requirement that:

          (a) the Collateral Agent shall have received from each Loan Party either (i) a counterpart of
the Collateral Agreement duly executed and delivered on behalf of such Loan Party or (ii) in the
case of any Person that becomes a Loan Party after the Effective Date, a supplement to the
Collateral Agreement as then in effect, in the form specified therein, duly executed and delivered
on behalf of such Loan Party;

          (b) all outstanding Equity Interests of each Restricted Subsidiary (other than any Restricted
Subsidiary that is a Securitization Vehicle) owned by or on behalf of any Loan Party shall have
been pledged pursuant to the Collateral Agreement (except that the Loan Parties shall not be
required to pledge more than 65% of the outstanding voting Equity Interests of any Foreign
Subsidiary) and the Collateral Agent shall have received certificates or other instruments
representing all such Equity Interests, together with stock powers or other instruments of transfer
with respect thereto endorsed in blank;

          (c) subject to Section 5.13(c), all Indebtedness of the Borrower and each Subsidiary that is
owing to any Loan Party shall be evidenced by a promissory note and shall have been pledged
pursuant to the Collateral Agreement and the Collateral Agent shall have received all such
promissory notes, together with instruments of transfer with respect thereto endorsed in blank;
provided that no promissory note shall be necessary in the case of Indebtedness owing by
the Borrower to any Restricted Subsidiary or by any Restricted Subsidiary to any other Restricted
Subsidiary or to the Borrower so long as such Indebtedness, if ever represented by a promissory
note, is pledged pursuant to the Collateral Agreement.

          (d) all documents and instruments, including Uniform Commercial Code financing statements,
required by law or reasonably requested by the Collateral Agent to be filed, registered or recorded
to create the Liens intended to be created by the Collateral Agreement and perfect such Liens to
the extent required by, and with the priority required by, the Collateral Agreement, shall have
been filed, registered or recorded or delivered to the Collateral Agent for filing, registration or
recording;

          (e) the Collateral Agent shall have received (i) counterparts of a Mortgage with respect to
each Mortgaged Property duly executed and delivered by the record owner of such Mortgaged Property,
(ii) a policy or policies of title insurance issued by a nationally recognized title insurance
company insuring the Lien of each such Mortgage as a valid first Lien on the Mortgaged Property
described therein, free of any other Liens except as expressly permitted by Section 6.02, together
with such endorsements, coinsurance and reinsurance as the Collateral Agent or

 

 

 6

the Required Lenders
may reasonably request, and (iii) such surveys, abstracts, appraisals, legal opinions and other documents as the Collateral Agent or the Required Lenders
may reasonably request with respect to any such Mortgage or Mortgaged Property; and

          (f) each Loan Party shall have obtained all consents and approvals required to be obtained by
it in connection with the execution and delivery of all Security Documents to which it is a party,
the performance of its obligations thereunder and the granting by it of the Liens thereunder; and

if and so long as a Collateral Release Period is in effect, the requirement that:

     (i) the Collateral Agent shall have received from each Loan Party either (i) a
counterpart of the Collateral Agreement duly executed and delivered on behalf of such Loan
Party or (ii) in the case of any Person that becomes a Loan Party after the Effective Date,
a supplement to the Collateral Agreement as then in effect, in the form specified therein,
duly executed and delivered on behalf of such Loan Party; and

     (ii) each Loan Party shall have obtained all consents and approvals required to be
obtained by it in connection with the execution and delivery of the Collateral Agreement and
the performance of its obligations thereunder.

          “Collateral Reinstatement Ratings Requirement” means the requirement that the
Borrower’s senior unsecured non-credit enhanced indebtedness for borrowed money be rated BB+ or
lower by S&P and Ba1 or lower by Moody’s (or, if the Borrower shall have no senior unsecured
non-credit enhanced indebtedness for borrowed money, that the Borrower’s corporate credit rating
assigned by S&P be BB+ or lower and assigned by Moody’s be Ba1 or lower); provided that if
at any time either Moody’s or S&P, or both, shall no longer maintain a rating for the Borrower’s
senior unsecured non-credit enhanced indebtedness for borrowed money, or no longer maintain a
corporate credit rating for the Borrower, as the case may be, the Administrative Agent and the
Borrower may agree to determine the Collateral Reinstatement Ratings Requirement using the
corresponding ratings level of one or more ‘nationally recognized statistical rating organizations’
(as such phrase is used in Rule 436 under the Securities Act of 1933).

          “Collateral Release Period” means any period during which the Liens on the Collateral
have been release (or are required to have been released) pursuant to Section 9.14 and are not
required to be reinstated pursuant to such Section.

          “Collateral Release Ratings Requirement” means the requirement that the Borrower’s
senior unsecured non-credit enhanced indebtedness for borrowed money be rated BBB- (with at least a
stable outlook) or higher by S&P and Baa3 (with at least a stable outlook) or higher by Moody’s
(or, if the Borrower shall have no senior unsecured non-credit enhanced indebtedness for borrowed
money, that the Borrower’s corporate credit rating assigned by S&P be BBB- (with at least a stable
outlook) or higher and assigned by Moody’s be Baa3 (with at least a stable outlook) or higher);
provided that if at any time either Moody’s or S&P, or both, shall no longer maintain a
rating for the Borrower’s senior unsecured non-credit enhanced indebtedness for borrowed money, or
no longer maintain a corporate credit rating for the Borrower, as

 

 

 7

the case may be, the
Administrative Agent and the Borrower may agree to determine the Collateral Release Ratings Requirement using the corresponding ratings level of
one or more ‘nationally recognized statistical rating organizations’ (as such phrase is used in
Rule 436 under the Securities Act of 1933).

          “Commitment” means, with respect to each Lender, the commitment, if any, of such
Lender to make Loans and to acquire participations in Letters of Credit hereunder, expressed as an
amount representing the maximum aggregate amount of such Lenders’ Revolving Exposure hereunder, as
such commitment may be (a) reduced from time to time pursuant to Section 2.07, (b) increased
pursuant to Section 2.18 and (c) reduced or increased from time to time pursuant to assignments by
or to such Lender pursuant to Section 9.04. The initial amount of each Lender’s Commitment is set
forth on Schedule 2.01, or in the Assignment and Acceptance pursuant to which such Lender shall
have assumed its Commitment, as applicable. The aggregate amount of the Lenders’ Commitments as of
the Effective Date is $225,000,000.

          “Consolidated Cash Interest Expense” means, for any period, the excess of (a) the sum
(without duplication) of (i) the interest expense (including imputed interest expense in respect of
Capital Lease Obligations) of the Borrower and the Restricted Subsidiaries for such period,
determined on a consolidated basis in accordance with GAAP, (ii) the amount of dividends paid in
respect of the Capital Securities during such period, plus (iii) any cash payments made during such
period in respect of obligations referred to in clause (b)(iii) below that were amortized or
accrued in a previous period, minus (b) the sum (without duplication) of (i) interest income of the
Borrower and the Restricted Subsidiaries for such period, determined on a consolidated basis in
accordance with GAAP, (ii) to the extent included in such consolidated interest expense for such
period, non-cash amounts attributable to amortization of financing costs paid in a previous period,
(iii) to the extent included in such consolidated interest expense for such period, non-cash
amounts attributable to amortization of debt discounts or accrued interest payable in kind for such
period, plus (iv) to the extent included in such consolidated interest expense for such period,
interest expense of the Borrower and the Restricted Subsidiaries with respect to Indebtedness
incurred in connection with any Securitization and permitted by Section 6.01(ix).

          “Consolidated EBITDA” means, for any period, Consolidated Net Income for such period
plus (a) without duplication and to the extent deducted from revenues in determining such
Consolidated Net Income, the sum of (i) consolidated interest expense for such period, (ii)
consolidated income tax expense for such period, (iii) all amounts attributable to depreciation and
amortization for such period and (iv) all non-cash nonrecurring charges during such period (it
being understood that charges shall be deemed non-cash charges until the period that cash
disbursements attributable to such charges are made, at which point such charges shall be deemed
cash charges), and minus (b) without duplication and to the extent added to revenues in determining
Consolidated Net Income for such period, all non-cash nonrecurring gains during such period (it
being understood that non-cash nonrecurring gains shall be deemed non-cash gains until the period
that cash receipts attributable to such gains are received, at which point such gains shall be
deemed cash gains), all as determined on a consolidated basis with respect to the Borrower and the
Restricted Subsidiaries in accordance with GAAP. For purposes of calculating the Leverage Ratio,
as of any date, if the Borrower or any Restricted Subsidiary has made any Permitted Acquisition or,
as permitted by Section 6.05, any sale, transfer, lease

 

 

 8

 or other disposition outside of the ordinary course of business of a Subsidiary or of assets
constituting a business unit, in each case for consideration in excess of $10,000,000, during the
period of four consecutive fiscal quarters (a “Reference Period”) most recently ended on or
prior to such date, Consolidated EBITDA for the such Reference Period shall be calculated after
giving pro forma effect thereto, as if such Permitted Acquisition or sale, transfer, lease or other
disposition (and any related incurrence, repayment or assumption of Indebtedness with any new
Indebtedness being deemed to be amortized over the applicable testing period in accordance with its
terms) had occurred on the first day of such Reference Period.

          “Consolidated Net Income” means, for any period, the net income or loss of the
Borrower and the Restricted Subsidiaries for such period determined on a consolidated basis in
accordance with GAAP; it being understood that Consolidated Net Income shall not include (a) the
income or loss of any Subsidiary other than a Restricted Subsidiary or other investment held by the
Borrower or any Restricted Subsidiary, except to the extent of the amount of dividends or other
distributions actually paid to the Borrower or any Restricted Subsidiary during such period, and
(b) the income or loss of any Person accrued prior to the date it becomes a Restricted Subsidiary
or is merged into or consolidated with the Borrower or any Restricted Subsidiary or the date that
such Person’s assets are acquired by the Borrower or any Restricted Subsidiary.

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

          “Default” means any event or condition which constitutes an Event of Default or which
upon notice, lapse of time or both would, unless cured or waived, become an Event of Default.

          “Disclosed Matters” means the actions, suits and proceedings and the environmental
matters disclosed in Schedule 3.06.

          “dollars” or “$” refers to lawful money of the United States of America.

          “Effective Date” means the date on which the conditions specified in Section 4.01 are
satisfied (or waived in accordance with Section 9.02).

          “Environmental Laws” means all laws, rules, regulations, codes, ordinances, orders,
decrees, judgments, injunctions, notices or binding agreements issued, promulgated or entered into
by any Governmental Authority, relating in any way to the environment, preservation or reclamation
of natural resources, the management, release or threatened release of any Hazardous Material or to
health and safety matters.

          “Environmental Liability” means any liability, contingent or otherwise (including any
liability for damages, costs of environmental remediation, fines, penalties or indemnities), of the
Borrower or any Subsidiary directly or indirectly resulting from or based upon (a) violation of any
Environmental Law, (b) the generation, use, handling, transportation, storage, treatment or
disposal of any Hazardous Materials,

 

 

 9

(c) exposure
to any Hazardous Materials, (d) the release or threatened release of any Hazardous Materials into the environment or (e) any contract,
agreement or other consensual arrangement pursuant to which liability is assumed or imposed with
respect to any of the foregoing.

          “Equity Interests” means shares of capital stock, interests in a cooperative
corporation, partnership interests, membership interests in a limited liability company, beneficial
interests in a trust (other than any trust subject to ERISA or non-qualified pension benefit plans)
or other equity ownership interests in a Person, and any warrants, options or other rights
entitling the holder thereof to purchase or acquire any such equity interest.

          “ERISA” means the Employee Retirement Income Security Act of 1974, as amended from
time to time.

          “ERISA Affiliate” means 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” means (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 ERISA Affiliate from the PBGC
or a plan administrator of any notice relating to an 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 or partial withdrawal from any Plan or
Multiemployer Plan; or (g) the receipt by the Borrower or any ERISA Affiliate of any notice, or the
receipt by any Multiemployer Plan from the Borrower or any ERISA Affiliate 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.

          “Eurodollar”, when used in reference to any Loan or Borrowing, refers to whether such
Loan, or the Loans comprising such Borrowing, are bearing interest at a rate determined by
reference to the Adjusted LIBO Rate.

          “Event of Default” has the meaning assigned to such term in Article VII.

          “Excluded Taxes” means, with respect to either Agent, any Lender, any Issuing Bank or
any other recipient of any payment to be made by or on account of any obligation of the Borrower
hereunder, (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

 

 

 10

America or any similar tax imposed by any other jurisdiction described in clause (a) above and
(c) in the case of a Foreign Lender (other than an assignee pursuant to a request by the Borrower
under Section 2.17(b)), any withholding tax that (i) is in effect and would apply to amounts
payable to such Foreign Lender at the time such Foreign Lender becomes a party to this Agreement
(or designates a new lending office), 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 any withholding tax pursuant to
Section 2.15(a), or (ii) is attributable to such Foreign Lender’s failure to comply with Section
2.15(e).

          “Existing Letters of Credit” means each letter of credit that is (a) issued by an
Issuing Bank or a Lender, (b) outstanding on the Effective Date and (c) listed in Schedule 1.01(c).

          “Federal Funds Effective Rate” means, for any day, the weighted average (rounded
upwards, if necessary, to the next 1/100 of 1%) 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 (rounded upwards, if
necessary, to the next 1/100 of 1%) of the quotations for such day for such transactions received
by the Co-Administrative Agent from three Federal funds brokers of recognized standing selected by
it.

          “Financial Covenants” means the covenants set forth in Sections 6.12 and 6.13.

          “Financial Officer” means the chief financial officer, principal accounting officer,
treasurer or controller of the Borrower.

          “Foreign Lender” means 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 Subsidiary” means any Subsidiary that is organized under the laws of a
jurisdiction other than the United States of America or any State thereof or the District of
Columbia.

          “Funded Receivables Sales” means, on any date, with respect to sales of accounts
receivable or of interests in pools of accounts receivable by Securitization Vehicles to third
party purchasers (“Purchasers”) pursuant to any receivables purchase facilities, the
aggregate amounts theretofore paid to such Securitization Vehicles for purchases of accounts
receivable (or such interests therein) less the aggregate amount of collections theretofore
distributed to such Purchasers on account of the principal balance of such purchased receivables
(or interests therein) (exclusive of yield and fees), in each case pursuant to such receivables
purchase facilities; provided, however, that Funded Receivables Sales shall not be
deemed to arise as a result of any sale of accounts receivable or of interests in pools of accounts
receivable by a

 

 

 11

Securitization Vehicle to the extent that such sale results in Indebtedness (including in
respect of Third Party Securities) of such Securitization Vehicle to such Purchasers.

          “GAAP” means generally accepted accounting principles in the United States of America.

          “Governmental Authority” means the government of the United States of America, any
other nation or any political subdivision thereof, whether state or local, and any agency,
authority, instrumentality, regulatory body, court, central bank or other entity exercising
executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or
pertaining to government.

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

          “Hazardous Materials” means all explosive or radioactive substances or wastes and all
hazardous or toxic substances, wastes or other pollutants, including petroleum or petroleum
distillates, asbestos or asbestos containing materials, polychlorinated biphenyls, radon gas,
infectious or medical wastes and all other substances or wastes of any nature regulated pursuant to
any Environmental Law.

          “Hedging Agreement” means any interest rate protection agreement, foreign currency
exchange agreement, commodity price protection agreement or other interest or currency exchange
rate or commodity price hedging arrangement.

          “Indebtedness” of any Person means, without duplication, (a) all obligations of such
Person for borrowed money or with respect to deposits or advances of any kind (excluding current
accounts payable incurred in the ordinary course of business), (b) all obligations of such Person
evidenced by bonds, debentures, notes or similar instruments, (c) all obligations of such Person
upon which interest charges are customarily paid, (d) all obligations of such Person under
conditional sale or other title retention agreements relating to property acquired by such Person,
(e) all obligations of such Person in respect of the deferred purchase price of property or
services (excluding current accounts payable incurred in the ordinary course of business), (f) all
Indebtedness of others secured by (or for which the holder of such Indebtedness has

 

 

 12

an existing
right, contingent or otherwise, to be secured by) any Lien on
property owned or acquired by such Person, whether or not the Indebtedness secured thereby has been assumed, (g) all Guarantees
by such Person of Indebtedness of others, (h) all Capital Lease Obligations of such Person, (i) all
obligations, contingent or otherwise, of such Person as an account party in respect of letters of
credit and letters of guaranty, (j) all obligations, contingent or otherwise, of such Person in
respect of bankers’ acceptances, and (k) all obligations in respect of Third Party Securities
issued by such Person in Securitizations (regardless of whether denominated as equity or debt
securities). The Indebtedness of any Person shall include the Indebtedness of any other entity
(including any partnership in which such Person is a general partner) to the extent such Person is
liable therefor as a result of such Person’s ownership interest in or other relationship with such
entity, except to the extent the terms of such Indebtedness provide that such Person is not liable
therefor.

          “Indemnified Taxes” means Taxes other than Excluded Taxes.

          “Index Debt” means (i) if the Liens of the Security Documents in the Collateral have
not been released pursuant to Section 9.14, senior secured non-credit enhanced indebtedness for
borrowed money of the Borrower and (ii) if the Liens of the Security Documents in the Collateral
have been released pursuant to Section 9.14, senior unsecured non-credit enhanced indebtedness for
borrowed money of the Borrower.

          “Information Memorandum” means the Confidential Information Memorandum dated July,
2006 relating to the Borrower and the Transactions.

          “Intercreditor Agreement” means the lien subordination and intercreditor agreement,
dated as of December 23, 2003, entered into among the Borrower, the Subsidiary Loan Parties, the
Collateral Agent and the trustee under the Senior Second Lien Note Indenture (or any other trustee
or agent to which Liens are granted under the Second Lien Security Documents), providing for, among
other things, (a) the priority of the Liens granted pursuant to the Security Documents over the
Liens granted pursuant to the Second Lien Security Documents and (b) restrictions on the exercise
of remedies under the Second Lien Security Documents.

          “Interest Election Request” means a request by the Borrower to convert or continue a
Borrowing in accordance with Section 2.06.

          “Interest Payment Date” means (a) with respect to any ABR Loan, the last day of each
March, June, September and December and (b) with respect to any Eurodollar Loan, the last day of
the Interest Period applicable to the Borrowing of which such Loan is a part and, in the case of a
Eurodollar Borrowing with an Interest Period of more than three months’ duration, each day prior to
the last day of such Interest Period that occurs at intervals of three months’ duration after the
first day of such Interest Period.

          “Interest Period” means, with respect to any Eurodollar Borrowing, the period
commencing on the date of such Borrowing and ending on the numerically corresponding day in the
calendar month that is one, two, three or six months thereafter, as the Borrower may elect;
provided, that (a) if any Interest Period would end on a day other than a Business Day,
such Interest Period shall be extended to the next succeeding Business Day unless such next
succeeding Business Day would fall in the next calendar month, in which case such Interest

 

 

 13

Period shall end on the next preceding Business Day and (b) any Interest Period that commences
on the last Business Day of a calendar month (or on a day for which there is no numerically
corresponding day in the last calendar month of such Interest Period) shall end on the last
Business Day of the last calendar month of such Interest Period. For purposes hereof, the date of
a Borrowing initially shall be the date on which such Borrowing is made and thereafter shall be the
effective date of the most recent conversion or continuation of such Borrowing.

          “Investment Grade Rating” means, on any date, the rating of the Index Debt as BBB- or
better by S&P and as Baa3 or better by Moody’s on such date.

          “Investment Grade RP Period” means each period of one fiscal quarter or consecutive
fiscal quarters (taken as a single accounting period) commencing after the Effective Date during
which the Borrower at all times has an Investment Grade Rating. Any Investment Grade RP Period
will terminate on the last day of the fiscal quarter immediately preceding the first fiscal quarter
after commencement of such Investment Grade RP Period during which the Borrower does not at all
times have an Investment Grade Rating.

          “Issuing Bank” means each of JPMorgan Chase Bank, N.A. and CoBank, in their capacities
as the issuers of Letters of Credit hereunder, and their successors in such capacities as provided
in Section 2.04(i). An Issuing Bank may, in its discretion, arrange for one or more Letters of
Credit to be issued by Affiliates of such Issuing Bank, in which case the term “Issuing Bank” shall
include any such Affiliate with respect to Letters of Credit issued by such Affiliate. Each
reference to the “Issuing Bank” in this Agreement shall mean a reference to JPMorgan Chase Bank,
N.A. or CoBank, as the case may be, and when used with respect to any Letter of Credit, shall be a
reference to such Issuing Bank that issued such Letter of Credit. Notwithstanding the foregoing,
if any Lender other than JPMorgan Chase Bank, N.A. is the issuer of an Existing Letter of Credit,
all references herein to the “Issuing Bank” shall be deemed references to such Lender insofar as
such Existing Letters of Credit are concerned.

          “Joint Venture” means any entity in respect of which the Borrower or a Restricted
Subsidiary owns significant Equity Interests and actively participates in significant business
decisions, which, in any case, is not a Wholly Owned Subsidiary.

          “LC Disbursement” means a payment made by an Issuing Bank pursuant to a Letter of
Credit.

          “LC Exposure” means, at any time, the sum of (a) the aggregate undrawn amount of all
outstanding Letters of Credit at such time plus (b) the aggregate amount of all LC Disbursements
that have not yet been reimbursed by or on behalf of the Borrower at such time. The LC Exposure of
any Lender at any time shall be its Applicable Percentage of the total LC Exposure at such time.

          “Letter of Credit” means any letter of credit issued or deemed issued pursuant to this
Agreement.

          “Lenders” means the Persons listed on Schedule 2.01, any other Person that shall have
become a party hereto pursuant to Section 2.18

 

 

 14

and any
other Person that shall have become a party hereto pursuant to an Assignment and Acceptance, other than any such Person
that ceases to be a party hereto pursuant to an Assignment and Acceptance.

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

          “LIBO Rate” means, with respect to any Eurodollar Borrowing for any Interest Period,
the rate appearing on Page 3750 of the Telerate Service (or on any successor or substitute page of
such Service, or any successor to or substitute for such Service, providing rate quotations
comparable to those currently provided on such page of such Service, as determined by the
Co-Administrative Agent from time to time for purposes of providing quotations of interest rates
applicable to dollar deposits in the London interbank market) at approximately 11:00 a.m., London
time, two Business Days prior to the commencement of such Interest Period, as the rate for dollar
deposits with a maturity comparable to such Interest Period. In the event that such rate is not
available at such time for any reason, then the “LIBO Rate” with respect to such Eurodollar
Borrowing for such Interest Period shall be the rate at which dollar deposits of $5,000,000 and for
a maturity comparable to such Interest Period are offered by the principal London office of the
Administrative Agent in immediately available funds in the London interbank market at approximately
11:00 a.m., London time, two Business Days prior to the commencement of such Interest Period.

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

          “Loan Documents” means this Agreement, any letter of credit applications referred to
in Section 2.04(a) or (b), any promissory notes delivered pursuant to Section 2.08(e), the
Intercreditor Agreement, the Collateral Agreement and the other Security Documents.

          “Loan Parties” means the Borrower and the Subsidiary Loan Parties.

          “Loans” means the loans made by the Lenders to the Borrower pursuant to this
Agreement.

          “LOL Finance” means LOL Finance Co., a Wholly Owned Subsidiary of the Borrower.

          “LOL SPV” means LOL SPV, LLC, a Delaware limited liability company.

          “Material Adverse Effect” means a material adverse effect on (a) the business,
operations, assets, properties, liabilities or condition, financial or otherwise, of the Borrower
and the Subsidiaries, taken as a whole, (b) the ability of the Loan Parties, taken as a whole, to
perform any of their material obligations under any Loan Document or (c) the rights of or benefits
available to the Lenders under any Loan Document.

 

 

 15

          “Material Indebtedness” means Indebtedness (other than the Loans, Letters of Credit
and all Indebtedness issued by a Securitization Vehicle), or obligations in respect of one or more
Hedging Agreements, of any one or more of the Borrower and its Restricted Subsidiaries in an
aggregate principal amount exceeding $10,000,000. For purposes of determining Material
Indebtedness, the “principal amount” of the obligations of the Borrower or any Restricted
Subsidiary in respect of any Hedging Agreement at any time shall be the maximum aggregate amount
(giving effect to any netting agreements) that the Borrower or such Restricted Subsidiary would be
required to pay if such Hedging Agreement were terminated at such time.

          “Maturity Date” means August 29, 2011.

          “MoArk” means MoArk, LLC, a Missouri limited liability company, and any successor
company to MoArk.

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

          “Mortgage” means a mortgage, deed of trust, assignment of leases and rents, leasehold
mortgage or other security document granting a Lien on any Mortgaged Property to secure the
Obligations. Each Mortgage shall be reasonably satisfactory in form and substance to the
Collateral Agent.

          “Mortgaged Property” means, initially, each parcel of real property and the
improvements thereto owned by a Loan Party and identified on Schedule 1.01(b), and includes each
other parcel of real property and improvements thereto with respect to which a Mortgage is granted
pursuant to Section 5.12 or 5.13.

          “Multiemployer Plan” means a multiemployer plan as defined in Section 4001(a)(3) of
ERISA.

          “Net Patronage Income” means net earnings of the Borrower from member-patron business,
reduced by an amount equal to such percentage from zero to 15% as determined by the Board of
Directors in advance of the beginning of each fiscal year.

          “Non-Investment Grade RP Period” means each period of one fiscal quarter or
consecutive fiscal quarters (taken as a single accounting period) commencing with the period
beginning July 1, 2006, during which the Borrower does not at all times have an Investment Grade
Rating. Any Non-Investment Grade RP Period will terminate on the last day of the fiscal quarter
immediately preceding the first fiscal quarter after the commencement of such Non-Investment RP
Period during which the Borrower at all times has an Investment Grade Rating.

          “Nonrecourse Securitization” means a Securitization permitted by this Agreement in
which (a) no portion of the Indebtedness or other obligations (contingent or otherwise) incurred by
the Securitization Vehicle in connection therewith (i) is Guaranteed (contingently or otherwise) by
the Borrower or any other Restricted Subsidiary, other than any Guarantee of obligations (other
than of principal of, or interest on, Indebtedness) that may be deemed to exist solely by virtue of
Standard Securitization Undertakings, (ii) is recourse (contingently or otherwise) to the Borrower
or any other Restricted Subsidiary, other than by virtue of Standard Securitization Undertakings or
(iii) is secured

 

 

 16

(contingently
or otherwise) by any Lien on assets of the Borrower or any other Restricted Subsidiary, other than (x) Liens on Seller’s Retained
Interests permitted by Section 6.02(viii) and (y) by virtue of Standard Securitization
Undertakings, (b) no portion of the Indebtedness or other obligations (contingent or otherwise)
incurred by the Borrower or any Restricted Subsidiary other than the applicable Securitization
Vehicle in connection therewith is other than pursuant to Standard Securitization Undertakings and
(c) neither the Borrower nor any Restricted Subsidiary (other than the applicable Securitization
Vehicle) has any obligation to maintain or preserve the applicable Securitization Vehicle’s
financial condition or cause it to achieve certain levels of operating results, other than pursuant
to Standard Securitization Undertakings.

          “Obligations” means (a) the due and punctual payment by the Borrower of (i) the
principal of and interest (including interest accruing during the pendency of any bankruptcy,
insolvency, receivership or other similar proceeding, regardless of whether allowed or allowable in
such proceeding) on the Loans, when and as due, whether at maturity, by acceleration, upon one or
more dates set for prepayment or otherwise, (ii) each payment required to be made by the Borrower
under this Agreement in respect of any Letter of Credit, when and as due, including payments in
respect of reimbursement of disbursements, interest thereon and obligations to provide cash
collateral, and (iii) all other monetary obligations of the Borrower to any of the Secured Parties
(as defined in the Collateral Agreement) under the Collateral Agreement or this Agreement and each
of the other Loan Documents, including fees, costs, expenses and indemnities, whether primary,
secondary, direct, contingent, fixed or otherwise (including monetary obligations incurred during
the pendency of any bankruptcy, insolvency, receivership or other similar proceeding, regardless of
whether allowed or allowable in such proceeding), (b) the due and punctual performance of all other
obligations of the Borrower under or pursuant this Agreement and each of the other Loan Documents,
(c) the due and punctual payment and performance of all the obligations of each other Loan Party
under or pursuant to this Agreement and each of the other Loan Documents and (d) the due and
punctual payment and performance of all obligations of each Loan Party under each Hedging Agreement
that (i) is in effect on the Effective Date with a counterparty that is a Lender or an Affiliate of
a Lender as of the Effective Date or (ii) is entered into after the Effective Date with any
counterparty that is a Lender or an Affiliate of a Lender at the time such Hedging Agreement is
entered into.

          “Other Taxes” means any and all present or future recording, stamp, documentary,
excise, transfer, sales, property or similar taxes, charges or 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.

          “Payment Date” means the date on which any Restricted Payment is made or on which any
Repurchase Expenditure is made in connection with a purchase of Senior Notes or Senior Second Lien
Notes.

          “PBGC” means the Pension Benefit Guaranty Corporation referred to and defined in ERISA
and any successor entity performing similar functions.

          “Perfection Certificate” means a certificate in the form of Exhibit D or any other
form approved by the Collateral Agent.

 

 

 17

          “Permitted Acquisition” means any acquisition (by merger, consolidation or otherwise)
by the Borrower or a Subsidiary Loan Party of all or substantially all the assets of, or all the
Equity Interests in, a Person or division or line of business of a Person, if (a) immediately after
giving effect thereto, no Default has occurred and is continuing or would result therefrom, (b) in
the case of the acquisition of a publicly traded corporation, at the time of the initial
announcement, if any, of the Borrower’s or such Subsidiary Loan Party’s intention, agreement or
offer to effect such acquisition, such acquisition was approved by the board of directors or
comparable governing body of the Person being acquired, (c) all transactions related thereto are
consummated in accordance with applicable laws and shall have been duly authorized by the Board of
Directors or comparable governing body of the Borrower or such Subsidiary Loan Party, as
applicable, (d) such acquired Person is organized under the laws of the United States of America or
any State thereof or the District of Columbia and substantially all the business of such acquired
Person or business consists of one or more businesses permitted to be conducted by the Borrower or
the Restricted Subsidiaries (other than LOL Finance or any Securitization Vehicle) pursuant to
Section 6.03(b) and not less than 80% of the consolidated gross operating revenues of such acquired
Person or business for the most recently ended period of 12 months for which financial statements
are available is derived from domestic operations in the United States of America, (e) each
Subsidiary resulting from such acquisition (and which survives such acquisition), other than (i)
any Subsidiary which is not a Wholly Owned Subsidiary and in which the investment by the Borrower
and the Restricted Subsidiaries is permitted by Section 6.04(l) and (ii) any Foreign Subsidiary,
shall be a Subsidiary Loan Party and, unless a Collateral Release Period is in effect, the Equity
Interests of each such Subsidiary resulting from such acquisition (and which survives such
acquisition), other than any Subsidiary described in the immediately preceding clause (i), to the
extent held by the Borrower or a Subsidiary Loan Party, shall have been (or within 15 Business Days
(or such longer period as may be acceptable to the Collateral Agent) after such acquisition, shall
be) pledged pursuant to the Collateral Agreement (subject to the limitations of the pledge of
Equity Interests of Foreign Subsidiaries set forth in the definition of “Collateral and Guarantee
Requirement”), (f) the Collateral and Guarantee Requirement shall have been (or within 15 Business
Days (or such longer period as may be acceptable to the Collateral Agent) after such acquisition
shall be) satisfied with respect to each such Subsidiary, (g) the Borrower and the Subsidiaries are
in Pro Forma Compliance, after giving effect to such acquisition, and (h) the Borrower has
delivered to the Administrative Agent a Financial Officer’s certificate to the effect set forth in
clauses (a), (b), (c), (d), (e), (f) and (g) above, together with all relevant financial
information for the Person or assets acquired and reasonably detailed calculations demonstrating
satisfaction of the requirement set forth in clause (g) above.

          “Permitted Additional Debt” means (a) Indebtedness of the Borrower which (i) does not
mature, and is not subject to mandatory repurchase, redemption or amortization (other than pursuant
to customary asset sale or change in control provisions requiring redemption or repurchase only if
and to the extent then permitted by this Agreement), in each case, prior to the date that is six
months after the Maturity Date, (ii) is not secured, directly or indirectly, by any assets of the
Borrower or any Restricted Subsidiary, and (iii) is not exchangeable or convertible into
Indebtedness of the Borrower or any Restricted Subsidiary (except other Permitted Additional Debt),
or any preferred stock or other Equity Interest of the Borrower or any Restricted Subsidiary (other
than common equity of the Borrower, provided that any such exchange or conversion, if effected,
would not result in a Change in Control) and (b) any unsecured Guarantees with respect to such
Indebtedness given by Restricted Subsidiaries.

 

 

          “Permitted Encumbrances” means:

          (a) Liens imposed by law for taxes that are not yet due or are being contested in compliance
with Section 5.05;

          (b) carriers’, warehousemen’s, mechanics’, materialmen’s, repairmen’s, growers’, producers’,
farmers’ and other like Liens imposed by law, arising in the ordinary course of business and
securing obligations that are not overdue by more than 30 days or are being contested in compliance
with Section 5.05;

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

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

          (e) judgment liens in respect of judgments that do not constitute an Event of Default under
clause (k) of Article VII; and

          (f) easements, zoning restrictions, rights-of-way and similar encumbrances on real property
imposed by law or arising in the ordinary course of business that do not secure any monetary
obligations and do not materially adversely affect the value of the property, taken as a whole, or
interfere with the ordinary conduct of business of the Borrower or any Restricted Subsidiary;

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

          “Permitted Investments” means:

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

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

          (c) investments in certificates of deposit, banker’s acceptances and time deposits
(provided that such certificates of deposit, banker’s acceptances and time deposits are
rated at least A by S&P or at least A2 by Moody’s) maturing within 180 days from the date of
acquisition thereof issued or guaranteed by or placed with any domestic office of any commercial
bank organized under the laws of the United States of America or any State thereof which has a
combined capital and surplus and undivided profits of not less than $500,000,000;

 

 

 19

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

          (e) shares of money market mutual or similar funds which invest exclusively in assets
satisfying the requirements of clauses (a) through (d) of this definition.

          “Person” means any natural person, corporation, limited liability company, trust,
joint venture, association, cooperative association, company, partnership, Governmental Authority
or other entity.

          “Plan” means 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 302 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.

          “Pollution Control Bonds” means the $10,000,000 California Pollution Control Financing
Authority Tax-Exempt Variable Rate Demand Solid Waste Disposal Revenue Bonds (Cheese & Protein
International LLC Project), Series 2001A issued on April 11, 2001 pursuant to the Trust Indenture
between the California Pollution Control Financing Authority, as Issuer, and Wells Fargo Bank
Minnesota, N.A., as Trustee, and the related promissory note issued by Cheese & Protein
International LLC and held by the California Pollution Control Financing Authority.

          “Prime Rate” means the rate of interest per annum publicly announced from time to time
by JPMorgan Chase Bank, N.A. as its prime rate in effect at its principal office in New York City;
each change in the Prime Rate shall be effective from and including the date such change is
publicly announced as being effective.

          “Pro Forma Compliance” means, with respect to any event, that the Borrower is in pro
forma compliance with the Financial Covenants recomputed as if the event with respect to which Pro
Forma Compliance is being tested had occurred on the first day of each relevant period with respect
to which current compliance with such Financial Covenants would be determined (for example, in the
case of Financial Covenants based on Consolidated EBITDA, as if such event had occurred on the
first day of the four fiscal quarter period ending on the last day of the most recent fiscal
quarter in respect of which financial statements have been delivered pursuant to Section 5.01(a) or
(b)).

          “Prospective Lender” has the meaning assigned to such term in Section 2.18.

          “Register” has the meaning set forth in Section 9.04.

          “Related Parties” means, with respect to any specified Person, such Person’s
Affiliates and the respective directors, officers, trustees, employees, agents and advisors of such
Person and such Person’s Affiliates.

 

 

 20

          “Repurchase Expenditures” means, with respect to any purchase or repurchase of Senior
Notes, Senior Second Lien Notes or Capital Securities, the aggregate amount of expenditures made or
required to be made to effect such purchase or repurchase, including without limitation payments on
account of principal, premium and fees payable to holders of the Indebtedness or other security
purchased or reacquired in connection with such purchase or repurchase, but excluding payments
representing accrued interest to the date of such purchase or repurchase.

          “Required Lenders” means, at any time, Lenders having Revolving Exposures and unused
Commitments representing more than 50% of the sum of the total Revolving Exposures and unused
Commitments at such time.

          “Restricted Expenditures” means the sum of (a)(x) Restricted Payments made after the
Effective Date pursuant to Section 6.08(a)(ii), (y) Restricted Payments made after the Effective
Date pursuant to Section 6.08(a)(iii) and (z) Repurchase Expenditures made after the Effective Date
pursuant to Section 6.08(b)(iv), plus, without duplication, (b) Restricted Payments or
Repurchase Expenditures made on or after July 1, 2006 and prior to the Effective Date pursuant to
Section 6.08(a)(ii) or Section 6.08(b)(iv) of the Existing Agreement.

          “Restricted Payment” means any dividend or other distribution (whether in cash,
securities or other property, but other than a dividend or distribution in respect of the Capital
Securities), including any cash patronage refunds, redemptions or revolvements to patrons or
members, with respect to any shares of any class of capital stock or other Equity Interest of, or
cooperative membership interest or accounts with, the Borrower or any Restricted Subsidiary, or any
payment (whether in cash, securities or other property), including any sinking fund or similar
deposit, on account of the purchase, redemption, retirement, revolvement, acquisition, cancellation
or termination of any such shares of capital stock, other Equity Interest or cooperative membership
interest or account of the Borrower or any option, warrant or other right to acquire any such
shares of capital stock, other Equity Interest or cooperative membership interest or account of the
Borrower.

          “Restricted Subsidiaries” means each existing and subsequently acquired or organized
domestic and foreign direct or indirect Wholly Owned Subsidiary of the Borrower; provided
that, notwithstanding the foregoing, neither MoArk nor any of MoArk’s direct or indirect Wholly
Owned Subsidiaries shall be a Restricted Subsidiary.

          “Revolving Exposure” means, with respect to any Lender at any time, the sum of the
outstanding principal amount of such Lender’s Loans and its LC Exposure at such time.

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

          “Sale-Leaseback Transaction” means any arrangement whereby the Borrower or a
Restricted Subsidiary shall sell or transfer any property, real or personal, used or useful in its
business, whether now owned or hereinafter acquired, and thereafter rent or lease such property or
other property that it intends to use for substantially the same purpose or purposes as the
property sold or transferred; provided that any such

 

 

 21

arrangement entered into within 90
days after the acquisition, construction or substantial improvement of the subject property shall
not be deemed to be a “Sale-Leaseback Transaction”.

          “Second Lien Security Documents” means any and all security agreements, pledge
agreements, mortgages and other agreements and documents pursuant to which any Liens are granted to
secure any Senior Second Lien Note Obligations.

          “Securitization” means the transfer and sale by the Borrower or the Restricted
Subsidiaries of accounts receivable (including Account Assets) to a Securitization Vehicle, which
Securitization Vehicle finances the acquisition of such assets (i) with proceeds from the issuance
of Third Party Securities, (ii) with Sellers’ Retained Interests and (iii) with proceeds from the
sale or collection of accounts receivable (including Account Assets) purchased by such
Securitization Vehicle, including sales of receivables to third parties pursuant to receivables
purchase facilities.

          “Securitization Vehicle” means LOL SPV and any other special purpose trust,
partnership, limited liability company or similar entity formed at the direction of the Borrower or
any Restricted Subsidiary for the purpose of effecting one or more Securitizations which, in
connection therewith, issues Third Party Securities or sells receivables to third parties pursuant
to a receivables purchase facility.

          “Security Documents” means the Collateral Agreement, the Mortgages and each other
security agreement or other instrument or document executed and delivered pursuant to Section 5.12
or 5.13 to secure any of the Obligations.

          “Sellers’ Retained Interests” means the debt or equity interests held by the Borrower
or any Restricted Subsidiary in a Securitization Vehicle to which accounts receivable (including
Account Assets) of the Borrower and the Restricted Subsidiaries have been transferred in a
Securitization, including any such debt or equity received in consideration for the assets
transferred.

          “Senior Debt to EBITDA Ratio” means, on any date, the ratio of (a) the Total
Indebtedness of the Borrower and the Restricted Subsidiaries as of such date that is not
contractually subordinated to other Indebtedness of the Borrower or the Restricted Subsidiaries in
the amount that would be reflected on a consolidated balance sheet of the Borrower and the
Restricted Subsidiaries prepared as of such date in accordance with GAAP, to (b) Consolidated
EBITDA for the most recent period of four consecutive fiscal quarters of the Borrower and the
Restricted Subsidiaries ended on or prior to such date.

          “Senior Notes” means the 8-3/4% Senior Notes due 2011 issued by the Borrower on
November 14, 2001 and the Indebtedness represented thereby.

          “Senior Note Documents” means the indenture under which the Senior Notes are issued
and all other instruments, agreements and other documents evidencing or governing the Senior Notes
or rights in respect thereof.

          “Senior Secured Debt to EBITDA Ratio” means, on any date, the ratio of (a) the Total
Indebtedness of the Borrower and the Restricted

 

 

 22

Subsidiaries
as of such date that is, directly or indirectly, secured by any assets or properties of the Borrower or the Restricted
Subsidiaries in the amount that would be reflected on a consolidated balance sheet of the Borrower
and the Restricted Subsidiaries prepared as of such date in accordance with GAAP, to (b)
Consolidated EBITDA for the most recent period of four consecutive fiscal quarters of the Borrower
and the Restricted Subsidiaries ended on or prior to such date.

          “Senior Second Lien Note Documents” means the Senior Second Lien Notes, the Senior
Second Lien Note Indenture, agreements evidencing the Guarantees of the Senior Second Lien Notes by
the Subsidiary Loan Parties, the Second Lien Security Documents, the Intercreditor Agreement and
all other instruments, agreements and documents evidencing, guaranteeing or otherwise governing the
terms of the Senior Second Lien Notes.

          “Senior Second Lien Note Indenture” means the indenture pursuant to which the Senior
Second Lien Notes are issued.

          “Senior Second Lien Notes” means the 9% Senior Secured Notes due 2010 issued by the
Borrower on December 23, 2003 and the Indebtedness represented thereby.

          “Senior Second Lien Note Obligations” means (a) the principal of and all premium or
make-whole amounts, if any, and interest payable in respect of the Senior Second Lien Notes, (b)
any amounts payable under Guarantees of the Senior Second Lien Notes by Restricted Subsidiaries and
(c) all other amounts payable by the Borrower or any Restricted
Subsidiary under the Senior Second
Lien Notes or the Senior Second Lien Note Indenture.

          “Standard Securitization Undertakings” means representations, warranties, covenants
and indemnities made by the Borrower or a Subsidiary in connection with Securitizations permitted
by this Agreement, which representations, warranties, covenants and indemnities are customarily
included in securitizations of accounts receivable involving companies comparable to the Borrower.

          “Statutory Reserve Rate” means 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 (without
duplication) of the maximum reserve percentages (including any marginal, special, emergency or
supplemental reserves) expressed as a decimal established by the Board to which the
Co-Administrative Agent is subject for eurocurrency funding (currently referred to as “Eurocurrency
Liabilities” in Regulation D of the Board). Such reserve percentages shall include those imposed
pursuant to such Regulation D. Eurodollar Loans shall be deemed to constitute eurocurrency funding
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
or any comparable regulation. The Statutory Reserve Rate shall be adjusted automatically on and as
of the effective date of any change in any reserve percentage.

          “subsidiary” means, with respect to any Person (the “parent”) at any date, any
corporation, limited liability company, partnership, association or other entity the accounts of
which would be consolidated with those of the parent in the parent’s consolidated financial

 

 

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statements
if such financial statements were prepared in accordance with GAAP as of such date, as well as any other corporation, limited liability company, partnership, association or other
entity (a) of which securities or other ownership interests representing more than 50% of the
equity or more than 50% of the ordinary voting power or, in the case of a partnership, more than
50% of the general partnership interests are, as of such date, owned, controlled or held, or (b)
that is, as of such date, otherwise Controlled, by the parent or one or more subsidiaries of the
parent or by the parent and one or more subsidiaries of the parent.

          “Subsidiary” means any subsidiary of the Borrower.

          “Subsidiary Loan Party” means each Restricted Subsidiary other than (i) LOL Finance
and its Wholly Owned Subsidiaries, (ii) Foreign Subsidiaries and (iii) LOL SPV. The Restricted
Subsidiaries and the Subsidiary Loan Parties on the Effective Date are identified on Schedule
1.01(a).

          “Taxes” means any and all present or future taxes, levies, imposts, duties,
deductions, charges or withholdings imposed by any Governmental Authority.

          “Third Party Securities” means, with respect to any Securitization, notes, bonds or
other debt instruments, beneficial interests in a trust, undivided ownership interests in an entity
or in a pool or pools of accounts receivable or other securities issued for cash consideration by
the relevant Securitization Vehicle to banks, investors or other financing sources (other than the
Borrower and its Subsidiaries) the proceeds of which are used to finance, in whole or part, the
purchase by such Securitization Vehicle of accounts receivable (including Account Assets) in a
Securitization.

          “Total Indebtedness” means, as of any date, the aggregate principal amount of
Indebtedness of the Borrower and the Restricted Subsidiaries outstanding as of such date, in the
amount that would be reflected on a consolidated balance sheet of the Borrower and the Restricted
Subsidiaries prepared as of such date in accordance with GAAP; provided that ‘Total
Indebtedness’ shall not include (i) the Capital Securities or (ii) Indebtedness of the Borrower or
any Restricted Subsidiary incurred in connection with any Nonrecourse Securitization in amounts
permitted by Section 6.01(ix).

          “Transactions” means the execution, delivery and performance by each Loan Party of the
Loan Documents to which it is to be a party, the borrowing of Loans hereunder and the use of the
proceeds thereof as contemplated hereby and the issuance of Letters of Credit hereunder.

          “Type”, when used in reference to any Loan or Borrowing, refers to whether the rate of
interest on such Loan, or on the Loans comprising such Borrowing, is determined by reference to the
Adjusted LIBO Rate or the Alternate Base Rate.

          “Wholly Owned Subsidiary” of any Person shall mean a subsidiary of such Person of
which securities or other ownership interests (except for directors’ qualifying shares and other de
minimis amounts of outstanding securities or ownership interests) representing 100% of the ordinary
voting power or 100% of the general partnership interests are, at the time any determination is
being made, owned, controlled or

 

 

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held by
such Person or one or more Wholly Owned subsidiaries of such Person or by such Person and one or more Wholly Owned
subsidiaries of such Person.

          “Withdrawal Liability” means 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. Classification of Loans and Borrowings. For purposes of this Agreement,
Loans and Borrowings may be classified and referred to by Type (e.g., a “Eurodollar Loan”
or “Eurodollar Borrowing”).

          SECTION 1.03. Terms Generally. The definitions of terms herein shall apply equally to
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”. The
word “will” shall be construed to have the same meaning and effect as the word “shall”. Unless the
context requires otherwise (a) any definition of or reference to any agreement, instrument or other
document herein shall be construed as referring to such agreement, instrument or other document as
from time to time amended, supplemented or otherwise modified, (b) any definition of or reference
to any statute herein shall be construed as referring to such statute as amended, or otherwise
revised or replaced (subject to any restrictions on such amendments, revisions or replacements set
forth herein), (c) any reference herein to any Person shall be construed to include such Person’s
successors and assigns, (d) the words “herein”, “hereof” and “hereunder”, and words of similar
import, shall be construed to refer to this Agreement in its entirety and not to any particular
provision hereof, (e) all references herein to Articles, Sections, Exhibits and Schedules shall be
construed to refer to Articles and Sections of, and Exhibits and Schedules to, this Agreement and
(f) the words “asset” and “property” shall be construed to have the same meaning and effect and to
refer to any and all tangible and intangible assets and properties, including cash, securities,
accounts and contract rights.

          SECTION 1.04. Accounting Terms; GAAP; Pro Forma Calculations. (a) Except as
otherwise expressly provided herein, all terms of an accounting or financial nature shall be
construed in accordance with GAAP, as in effect from time to time; provided that, if the
Borrower notifies the Co-Administrative Agent that the Borrower requests an amendment to any
provision hereof to eliminate the effect of any change occurring after the date hereof in GAAP or
in the application thereof on the operation of such provision (or if the Co-Administrative Agent
notifies the Borrower that the Required Lenders request an amendment to any provision hereof for
such purpose), regardless of whether any such notice is given before or after such change in GAAP
or in the application thereof, then such provision shall be interpreted on the basis of GAAP as in
effect and applied immediately before such change shall have become effective until such notice
shall have been withdrawn or such provision amended in accordance herewith. Any reference made
herein or in any other Loan Document to consolidated financial statements of the Borrower and the
Restricted Subsidiaries shall mean financial statements of the Borrower in which the assets and
operations of the Restricted Subsidiaries, but not Joint Ventures or Subsidiaries that are not
Restricted Subsidiaries, are consolidated with those of the Borrower and such Joint Ventures and
unrestricted Subsidiaries are accounted for as investments.

 

 

 25

          (b) All pro forma computations required to be made hereunder giving effect to any acquisition,
investment, sale, disposition, merger or similar event shall reflect on a pro forma basis such
event and, to the extent applicable, the historical earnings and cash flows associated with the
assets acquired or disposed of, any related incurrence or reduction of Indebtedness and, to the
extent permitted for pro forma financial statements under Regulation S-X adopted under the
Securities Act of 1933, as amended, cost savings resulting therefrom, but shall not take into
account any other projected synergies or similar benefits expected to be realized as a result of
such event.

ARTICLE II

The Credits

          SECTION 2.01. Commitments. Subject to the terms and conditions set forth herein, each
Lender agrees to make Loans to the Borrower from time to time during the Availability Period in an
aggregate principal amount that will not result in such Lender’s Revolving Exposure exceeding such
Lender’s Commitment. Within the foregoing limits and subject to the terms and conditions set forth
herein, the Borrower may borrow, prepay and reborrow Loans.

          SECTION 2.02. Loans and Borrowings. (a) Each Loan shall be made as part of a
Borrowing consisting of Loans of the same Type made by the Lenders ratably in accordance with their
respective Commitments. The failure of any Lender to make any Loan required to be made by it shall
not relieve any other Lender of its obligations hereunder; provided that the Commitments of
the Lenders are several and no Lender shall be responsible for any other Lender’s failure to make
Loans as required.

          (b) Subject to Section 2.12, each Borrowing shall be comprised entirely of ABR Loans or
Eurodollar Loans as the Borrower may request in accordance herewith. Each Lender at its option may
make any Eurodollar 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.

          (c) At the commencement of each Interest Period for any Eurodollar Borrowing, such Borrowing
shall be in an aggregate amount that is an integral multiple of $1,000,000 and not less than
$10,000,000. At the time that each ABR Borrowing is made, such Borrowing shall be in an aggregate
amount that is an integral multiple of $1,000,000 and not less than $10,000,000; provided
that an ABR Borrowing may be in an aggregate amount that is equal to the entire unused balance of
the total Commitments or that is required to finance the reimbursement of an LC Disbursement as
contemplated by Section 2.04(e). Borrowings of more than one Type may be outstanding at the same
time; provided that there shall not at any time be more than a total of 10 Eurodollar
Borrowings outstanding.

          (d) Notwithstanding any other provision of this Agreement, the Borrower shall not be entitled
to request, or to elect to convert or continue, any Borrowing if the Interest Period requested with
respect thereto would end after the Maturity Date.

 

 

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          SECTION 2.03. Requests for Borrowings. To request a Borrowing, the Borrower shall
notify the Co-Administrative Agent of such request by telephone (a) in the case of a Eurodollar
Borrowing, not later than 12:00 noon, New York City time, three Business Days before the date of
the proposed Borrowing or (b) in the case of an ABR Borrowing, not later than 12:00 noon., New York
City time, on the date of the proposed Borrowing. Each such telephonic Borrowing Request shall be
irrevocable and shall be confirmed promptly by hand delivery or telecopy to the Co-Administrative
Agent of a written Borrowing Request in a form approved by the Co-Administrative Agent and signed
by the Borrower. Each such telephonic and written Borrowing Request shall specify the following
information in compliance with Section 2.02:

     (i) the aggregate amount of such Borrowing;

     (ii) the date of such Borrowing, which shall be a Business Day;

     (iii) whether such Borrowing is to be an ABR Borrowing or a Eurodollar Borrowing;

     (iv) in the case of a Eurodollar Borrowing, the initial Interest Period to be
applicable thereto, which shall be a period contemplated by the definition of the term
“Interest Period”; and

     (v) the location and number of the Borrower’s account to which funds are to be
disbursed, which shall comply with the requirements of Section 2.05.

If no election as to the Type of Borrowing is specified, then the requested Borrowing shall be an
ABR Borrowing. If no Interest Period is specified with respect to any requested Eurodollar
Borrowing, then the Borrower shall be deemed to have selected an Interest Period of one month’s
duration. Promptly following receipt of a Borrowing Request in accordance with this Section, the
Co-Administrative Agent shall advise each Lender of the details thereof and of the amount of such
Lender’s Loan to be made as part of the requested Borrowing.

          SECTION 2.04. Letters of Credit. (a) General. Subject to the terms and
conditions set forth herein, the Borrower may request the issuance of Letters of Credit for its own
account, in a form reasonably acceptable to the Co-Administrative Agent and the Issuing Bank
thereof, at any time and from time to time during the Availability Period. In the event of any
inconsistency between the terms and conditions of this Agreement and the terms and conditions of
any form of letter of credit application or other agreement submitted by the Borrower to, or
entered into by the Borrower with, any Issuing Bank relating to any Letter of Credit, the terms and
conditions of this Agreement shall control. Existing Letters of Credit will be deemed for all
purposes to have been issued pursuant to this Agreement, provided that any fees accruing in
respect of the Existing Letters of Credit prior to the Effective Date will be payable in accordance
with the agreements governing the Existing Letters of Credit prior to the Effective Date. No
Existing Letter of Credit that is not issued by JPMorgan Chase Bank, N.A. or CoBank will be
extended, amended or renewed, except pursuant to a replacement Letter of Credit issued by JPMorgan
Chase Bank, N.A. or CoBank in its capacity as an Issuing Bank hereunder.

 

 

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          (b) Notice of Issuance, Amendment, Renewal, Extension; Certain Conditions. To request
the issuance of a Letter of Credit (or the amendment, renewal or extension of an outstanding Letter
of Credit), the Borrower shall hand deliver or telecopy (or transmit by electronic communication,
if arrangements for doing so have been approved by the Issuing Banks) to an Issuing Bank and the
Co-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, and specifying the date of issuance,
amendment, renewal or extension (which shall be a Business Day), the date on which such Letter of
Credit is to expire (which shall comply with paragraph (c) of this Section), 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, amend, renew or extend such Letter of Credit. If requested by an
Issuing Bank, the Borrower also shall submit a letter of credit application on such Issuing Bank’s
standard form in connection with any request for a 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 LC Exposure shall not exceed
$75,000,000 and (ii) the sum of the Revolving Exposures shall not exceed the total Commitments.

          (c) Expiration Date. Each Letter of Credit shall expire at or prior to the close of
business on the earlier of (i) the date one year after the date of the issuance of such Letter of
Credit (or, in the case of any renewal or extension thereof, one year after such renewal or
extension) and (ii) the date that is five Business Days prior to the Maturity Date.

          (d) Participations. By the issuance of a Letter of Credit (or an amendment to a
Letter of Credit increasing the amount thereof) and without any further action on the part of the
Issuing Bank thereof or the Lenders, such Issuing Bank hereby grants to each Lender, and each
Lender hereby acquires from such Issuing Bank, a participation in such Letter of Credit equal to
such Lender’s Applicable Percentage of the aggregate amount available to be drawn under such Letter
of Credit. Such participations in the Existing Letters of Credit will be deemed to have been
acquired by the Lenders on the Effective Date. In consideration and in furtherance of the
foregoing, each Lender hereby absolutely and unconditionally agrees to pay to the Co-Administrative
Agent, for the account of such Issuing Bank, such Lender’s Applicable Percentage of each LC
Disbursement made by such Issuing Bank and not reimbursed by the Borrower on the date due as
provided in paragraph (e) of this Section, or of any reimbursement payment required to be refunded
to the Borrower for any reason. Each 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 any amendment,
renewal or extension of any Letter of Credit or the occurrence and continuance of a Default or
reduction or termination of the Commitments, and that each such payment shall be made without any
offset, abatement, withholding or reduction whatsoever.

          (e) Reimbursement. If an Issuing Bank shall make any LC Disbursement in respect of a
Letter of Credit, the Borrower shall reimburse such LC Disbursement by paying to the
Co-Administrative Agent an amount equal to such LC Disbursement not later than 12:00 noon, New

 

 

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 York
City time, on the date that such LC Disbursement is made, if the
Borrower shall have received notice of such LC Disbursement prior to 10:00 a.m., New York City time, on such
date, or, if such notice has not been received by the Borrower prior to such time on such date,
then not later than 12:00 noon, New York City time, the Business Day immediately following the day
that the Borrower receives such notice; provided that, if such LC Disbursement is not less
than $1,000,000 the Borrower may, subject to the conditions to borrowing set forth herein, request
in accordance with Section 2.03 that such payment be financed with an ABR Borrowing in an
equivalent amount and, to the extent so financed, the Borrower’s obligation to make such payment
shall be discharged and replaced by the resulting ABR Borrowing. If the Borrower fails to make
such payment when due, the Co-Administrative Agent shall notify each Lender of the applicable LC
Disbursement, the payment then due from the Borrower in respect thereof and such Lender’s
Applicable Percentage thereof. Promptly following receipt of such notice, each Lender shall pay to
the Co-Administrative Agent its Applicable Percentage of the payment then due from the Borrower, in
the same manner as provided in Section 2.05 with respect to Loans made by such Lender (and Section
2.05 shall apply, mutatis mutandis, to the payment obligations of the Lenders), and the
Co-Administrative Agent shall promptly pay to the Issuing Bank that made the LC Disbursement the
amounts so received by it from the Lenders. Promptly following receipt by the Co-Administrative
Agent of any payment from the Borrower pursuant to this paragraph, the Co-Administrative Agent
shall distribute such payment to such Issuing Bank or, to the extent that Lenders have made
payments pursuant to this paragraph to reimburse such Issuing Bank, then to such Lenders and such
Issuing Bank as their interests may appear. Any payment made by a Lender pursuant to this
paragraph to reimburse such Issuing Bank for any LC Disbursement (other than the funding of ABR
Loans as contemplated above) shall not constitute a Loan and shall not relieve the Borrower of its
obligation to reimburse such LC Disbursement.

          (f) Obligations Absolute. The Borrower’s obligation to reimburse LC Disbursements as
provided in paragraph (e) of this Section 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 this Agreement, or any term or provision therein, (ii) any draft or other
document presented under a Letter of Credit proving to be forged, fraudulent or invalid in any
respect or any statement therein being untrue or inaccurate in any respect, (iii) payment by an
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, or (iv) 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, or provide a right of setoff against,
the Borrower’s obligations hereunder. Neither the Co-Administrative Agent, the Lenders nor any
Issuing Bank, nor any of their Related Parties, shall have any liability or responsibility by
reason of or in connection with the issuance or transfer of any Letter of Credit or any payment or
failure to make any payment thereunder (irrespective of any of the circumstances referred to in the
preceding sentence), or any error, omission, interruption, loss or delay in transmission or
delivery of any draft, notice or other communication under or relating to any Letter of Credit
(including any document required to make a drawing thereunder), any error in interpretation of
technical terms or any consequence arising from causes beyond the control of any Issuing Bank;
provided that the foregoing shall not be construed to excuse an 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)

 

 

 29

suffered by the Borrower that are caused by such Issuing Bank’s failure to exercise care when
determining whether drafts and other documents presented under a Letter of Credit comply with the
terms thereof. The parties hereto expressly agree that, in the absence of gross negligence or
willful misconduct on the part of an Issuing Bank (as finally determined by a court of competent
jurisdiction), such Issuing Bank shall be deemed to have exercised care in each such determination.
In furtherance of the foregoing and without limiting the generality thereof, the parties agree
that, with respect to documents presented which appear on their face to be in substantial
compliance with the terms of a Letter of Credit, an Issuing Bank may, in its sole discretion,
either accept and make payment upon such documents without responsibility for further
investigation, regardless of any notice or information to the contrary, or refuse to accept and
make payment upon such documents if such documents are not in strict compliance with the terms of
such Letter of Credit.

          (g) Disbursement Procedures. An Issuing Bank shall, promptly following its receipt
thereof, examine all documents purporting to represent a demand for payment under a Letter of
Credit. Such Issuing Bank shall promptly notify the Co-Administrative Agent and the Borrower by
telephone (confirmed by telecopy) of such demand for payment and whether such Issuing Bank has made
or will make an LC Disbursement thereunder; provided that any failure to give or delay in
giving such notice shall not relieve the Borrower of its obligation to reimburse such Issuing Bank
and the Lenders with respect to any such LC Disbursement.

          (h) Interim Interest. If an Issuing Bank shall make any LC Disbursement, then, unless
the Borrower shall reimburse such LC Disbursement in full on the date such LC Disbursement is made,
the unpaid amount thereof shall bear interest, for each day from and including the date such LC
Disbursement is made to but excluding the date that the Borrower reimburses such LC Disbursement,
at the rate per annum then applicable to ABR Loans; provided that, if the Borrower fails to
reimburse such LC Disbursement when due pursuant to paragraph (e) of this Section, then Section
2.11(c) shall apply. Interest accrued pursuant to this paragraph shall be for the account of such
Issuing Bank, except that interest accrued on and after the date of payment by any Lender pursuant
to paragraph (e) of this Section to reimburse such Issuing Bank shall be for the account of such
Lender to the extent of such payment.

          (i) Replacement of an Issuing Bank. An Issuing Bank may be replaced at any time by
written agreement among the Borrower, the Co-Administrative Agent, the replaced Issuing Bank and
the successor Issuing Bank. The Co-Administrative Agent shall notify the Lenders of any such
replacement of an Issuing Bank. At the time any such replacement shall become effective, the
Borrower shall pay all unpaid fees accrued for the account of the replaced Issuing Bank pursuant to
Section 2.10(b). From and after the effective date of any such replacement, (i) the successor
Issuing Bank shall have all the rights and obligations of an Issuing Bank under this Agreement with
respect to Letters of Credit to be issued thereafter and (ii) references herein 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 replacement
of an Issuing Bank hereunder, the replaced Issuing Bank shall remain a party hereto and shall
continue to have all the rights and obligations of an Issuing Bank under this Agreement with
respect to Letters of Credit issued by it prior to such replacement, but shall not be required to
issue additional Letters of Credit.

 

 

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          (j) Cash Collateralization. If any Event of Default shall occur and be continuing, on
the Business Day that the Borrower receives notice from the Co-Administrative Agent or the Required
Lenders (or, if the maturity of the Loans has been accelerated, Lenders with LC Exposure
representing greater than 50% of the total LC Exposure) demanding the deposit of cash collateral
pursuant to this paragraph, the Borrower shall deposit in an account with the Co-Administrative
Agent, in the name of the Co-Administrative Agent and for the benefit of the Lenders, an amount in
cash equal to the LC Exposure as of such date plus any accrued and unpaid interest thereon;
provided that the obligation to deposit such cash collateral shall become effective
immediately, and such deposit shall become immediately due and payable, without demand or other
notice of any kind, upon the occurrence of any Event of Default with respect to the Borrower
described in clause (h) or (i) of Article VII. The Borrower also shall deposit cash collateral
pursuant to this paragraph as and to the extent required by Section 2.09(b). Each such deposit
shall be held by the Co-Administrative Agent as collateral for the payment and performance of the
obligations of the Borrower under this Agreement, and the Borrower hereby grants the
Co-Administrative Agent, for the benefit of the Lenders, a security interest in all funds and
investment from time to time in such account, and the proceeds thereof, to secure such obligations.
The Co-Administrative 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, which investments shall be made at the option and sole discretion of the
Co-Administrative Agent and at the Borrower’s risk and expense, such deposits shall not bear
interest. Interest or profits, if any, on such investments shall accumulate in such account.
Moneys in such account shall be applied by the Co-Administrative Agent to reimburse each Issuing
Bank for LC Disbursements for which it has not been reimbursed and, to the extent not so applied,
shall be held for the satisfaction of the reimbursement obligations of the Borrower for the LC
Exposure at such time or, if the maturity of the Loans has been accelerated (but subject to the
consent of Lenders with LC Exposure representing greater than 50% of the total LC Exposure), be
applied to satisfy other obligations of the Borrower under this Agreement. 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. If the
Borrower is required to provide an amount of cash collateral hereunder pursuant to Section 2.09(b),
such amount (to the extent not applied as aforesaid) shall be returned to the Borrower as and to
the extent that, after giving effect to such return, the Borrower would remain in compliance with
Section 2.09(b) and no Event of Default shall have occurred and be continuing.

          SECTION 2.05. Funding of Borrowings. (a) Each Lender shall make each Loan to be
made by it hereunder on the proposed date thereof by wire transfer of immediately available funds
by 2:00 p.m., New York City time, to the account of the Co-Administrative Agent most recently
designated by it for such purpose by notice to the Lenders. The Co-Administrative Agent will make
such Loans available to the Borrower by promptly crediting the amounts so received, in like funds,
to such account of the Borrower as the Borrower shall designate in the applicable Borrowing
Request; provided that ABR Loans made to finance the reimbursement of an LC Disbursement as
provided in Section 2.04(e) shall be remitted by the Co-Administrative Agent to the applicable
Issuing Bank.

 

 

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          (b) Unless the Co-Administrative Agent shall have received notice from a Lender prior to the
proposed date of any Borrowing that such Lender will not make available to the Co-Administrative
Agent such Lender’s share of such Borrowing, the Co-Administrative Agent may assume that such
Lender has made such share available on such date in accordance with paragraph (a) of this Section
and may, in reliance upon such assumption, make available to the Borrower a corresponding amount.
In such event, if a Lender has not in fact made its share of the applicable Borrowing available to
the Co-Administrative Agent, then the applicable Lender and the Borrower severally agree to pay to
the Co-Administrative Agent forthwith on demand such corresponding amount with interest thereon,
for each day from and including the date such amount is made available to the Borrower to but
excluding the date of payment to the Co-Administrative Agent, at (i) in the case of such Lender,
the greater of the Federal Funds Effective Rate and a rate determined by the Co-Administrative
Agent in accordance with banking industry rules on interbank compensation or (ii) in the case of
the Borrower, the interest rate applicable to ABR Loans. If such Lender pays such amount to the
Co-Administrative Agent, then such amount shall constitute such Lender’s Loan included in such
Borrowing.

          SECTION 2.06. Interest Elections. (a) Each Borrowing initially shall be of the
Type specified in the applicable Borrowing Request and, in the case of a Eurodollar Borrowing,
shall have an initial Interest Period as specified in such Borrowing Request. Thereafter, the
Borrower may elect to convert such Borrowing to a different Type or to continue such Borrowing and,
in the case of a Eurodollar Borrowing, may elect Interest Periods therefor, all as provided in this
Section. The Borrower may elect different options with respect to different portions of the
affected Borrowing, in which case each such portion shall be allocated ratably among the Lenders
holding the Loans comprising such Borrowing, and the Loans comprising each such portion shall be
considered a separate Borrowing.

          (b) To make an election pursuant to this Section, the Borrower shall notify the
Co-Administrative Agent of such election by telephone by the time that a Borrowing Request would be
required under Section 2.03. Each such telephonic Interest Election Request shall be irrevocable
and shall be confirmed promptly by hand delivery or telecopy to the Co-Administrative Agent of a
written Interest Election Request in a form approved by the Co-Administrative Agent and signed by
the Borrower.

          (c) Each telephonic and written Interest Election Request shall specify the following
information in compliance with Section 2.02:

     (i) the Borrowing to which such Interest Election Request applies and, if different
options are being elected with respect to different portions thereof, the portions thereof
to be allocated to each resulting Borrowing (in which case the information to be specified
pursuant to clauses (iii) and (iv) below shall be specified for each resulting Borrowing);

     (ii) the effective date of the election made pursuant to such Interest Election
Request, which shall be a Business Day;

     (iii) whether the resulting Borrowing is to be an ABR Borrowing or a Eurodollar
Borrowing; and

 

 

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     (iv) if the resulting Borrowing is a Eurodollar Borrowing, the Interest Period to be
applicable thereto after giving effect to such election, which shall be a period
contemplated by the definition of the term “Interest Period”.

If any such Interest Election Request requests a Eurodollar Borrowing but does not specify an
Interest Period, then the Borrower shall be deemed to have selected an Interest Period of one
month’s duration.

          (d) Promptly following receipt of an Interest Election Request, the Co-Administrative Agent
shall advise each Lender of the details thereof and of such Lender’s portion of each resulting
Borrowing.

          (e) If the Borrower fails to deliver a timely Interest Election Request with respect to a
Eurodollar Borrowing prior to the end of the Interest Period applicable thereto, then, unless such
Borrowing is repaid as provided herein, at the end of such Interest Period such Borrowing shall be
converted to an ABR Borrowing. Notwithstanding any contrary provision hereof, if an Event of
Default has occurred and is continuing and the Co-Administrative Agent, at the request of the
Required Lenders, so notifies the Borrower, then, so long as an Event of Default is continuing (i)
no outstanding Borrowing may be converted to or continued as a Eurodollar Borrowing and (ii) unless
repaid, each Eurodollar Borrowing shall be converted to an ABR Borrowing at the end of the Interest
Period applicable thereto.

          SECTION 2.07. Termination and Reduction of Commitments. (a) Unless previously
terminated, the Commitments shall terminate on the Maturity Date.

          (b) The Borrower may at any time terminate, or from time to time reduce, the Commitments;
provided that (i) each reduction of the Commitments shall be in an amount that is an
integral multiple of $1,000,000 and not less than $5,000,000 and (ii) the Borrower shall not
terminate or reduce the Commitments, if after giving effect to any concurrent prepayment of the
Loans in accordance with Section 2.09, the sum of the Revolving Exposures would exceed the total
Commitments.

          (c) The Borrower shall notify the Co-Administrative Agent of any election to terminate or
reduce the Commitments under paragraph (b) of this Section at least three Business Days prior to
the effective date of such termination or reduction, specifying such election and the effective
date thereof. Promptly following receipt of any notice, the Co-Administrative Agent shall advise
the Lenders of the contents thereof. Each notice delivered by the Borrower pursuant to this
Section shall be irrevocable; provided that a notice of termination of the Commitments
delivered by the Borrower may state that such notice is conditioned upon the effectiveness of other
credit facilities, in which case such notice may be revoked by the Borrower (by notice to the
Co-Administrative Agent on or prior to the specified effective date) if such condition is not
satisfied. Any termination or reduction of the Commitments shall be permanent. Each reduction of
the Commitments shall be made ratably among the Lenders in accordance with their respective
Commitments.

 

 

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          SECTION 2.08. Repayment of Loans; Evidence of Debt. (a) The Borrower hereby
unconditionally promises to pay to the Co-Administrative Agent for the account of each Lender the
then unpaid principal amount of each Loan of such Lender on the 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, including the amounts of principal and interest payable and paid to such Lender from time
to time hereunder.

          (c) The Co-Administrative Agent shall maintain accounts in which it shall record (i) the
amount of each Loan made hereunder, 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 Co-Administrative
Agent hereunder for the account of the Lenders and each Lender’s share thereof.

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

          (e) Any Lender may request that Loans made by it be evidenced by a promissory note. In such
event, the Borrower shall prepare, execute and deliver to such Lender a promissory note payable to
the order of such Lender (or, if requested by such Lender, to such Lender and its registered
assigns) in the form attached hereto as Exhibit F, with such changes, if any, as approved by the
Co-Administrative Agent and the Borrower. Thereafter, the Loans evidenced by such promissory note
and interest thereon shall at all times (including after assignment pursuant to Section 9.04) be
represented by one or more promissory notes in such form payable to the order of the payee named
therein (or, if such promissory note is a registered note, to such payee and its registered
assigns).

          SECTION 2.09. Prepayment of Loans. (a) The Borrower shall have the right at any
time and from time to time to prepay any Borrowing in whole or in part, subject to the requirements
of this Section.

          (b) In the event and on each occasion that the sum of the Revolving Exposures exceeds the
total Commitments, the Borrower shall immediately prepay Borrowings (or, if no such Borrowings are
outstanding, deposit cash collateral in an account with the Co-Administrative Agent pursuant to
Section 2.04(j)) in an aggregate amount equal to such excess.

          (c) The Borrower shall notify the Co-Administrative Agent by telephone (confirmed by telecopy)
of any prepayment hereunder (i) in the case of prepayment of a Eurodollar Borrowing, not later than
12:00 noon, New York City time, three Business Days before the date of prepayment and (ii) in the
case of prepayment of an ABR Borrowing, not later than 12:00 noon., New York City time, on the same
Business Day as the date of prepayment. Each such notice shall be irrevocable and shall specify
the prepayment date, the principal amount

 

 

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of each Borrowing or portion thereof to be prepaid and, in the case of a mandatory prepayment,
a reasonably detailed calculation of the amount of such prepayment; provided that, if a
notice of optional prepayment is given in connection with a conditional notice of termination of
the Commitments as contemplated by Section 2.07, then such notice of prepayment may be revoked if
such notice of termination is revoked in accordance with Section 2.07. Promptly following receipt
of any such notice, the Co-Administrative Agent shall advise the Lenders of the contents thereof.
Each partial prepayment of any Borrowing shall be in an amount that would be permitted in the case
of an advance of a Borrowing of the same Type as provided in Section 2.02, except as necessary to
apply fully the required amount of a mandatory prepayment. Each prepayment of a Borrowing shall be
applied ratably to the Loans included in the prepaid Borrowing. Prepayments shall be accompanied
by accrued interest to the extent required by Section 2.11.

          SECTION 2.10. Fees. (a) The Borrower agrees to pay to the Co-Administrative Agent
for the account of each Lender a commitment fee, which shall accrue at the Applicable Rate on the
daily unused amount of each Commitment of such Lender during the period from and including the
Effective Date to but excluding the date on which such Commitment terminates. Accrued commitment
fees shall be payable in arrears on the last day of March, June, September and December of each
year and on the date on which the Commitments terminate, commencing on the first such date to occur
after the date hereof; provided that any commitment fees accruing after the date on which
the Commitments terminate shall be payable on demand. All commitment fees shall be computed on the
basis of a year of 360 days and shall be payable for the actual number of days elapsed (including
the first day but excluding the last day). For purposes of computing commitment fees, a Commitment
of a Lender shall be deemed to be used to the extent of the outstanding Loans and LC Exposure of
such Lender.

          (b) The Borrower agrees to pay (i) to the Co-Administrative Agent for the account of each
Lender a participation fee with respect to its participations in Letters of Credit, which shall
accrue at the same Applicable Rate as the spread on Eurodollar Loans on the daily amount of such
Lender’s LC Exposure (excluding any portion thereof attributable to unreimbursed LC Disbursements)
during the period from and including the Effective Date to but excluding the later of the date on
which such Lender’s Commitment terminates and the date on which such Lender ceases to have any LC
Exposure, and (ii) to each Issuing Bank a fronting fee, which shall accrue at the rate of 0.25% per
annum on the average daily amount of the LC Exposure attributable to such Issuing Bank’s Letters of
Credit (excluding any portion thereof attributable to unreimbursed LC Disbursements) during the
period from and including the Effective Date to but excluding the later of the date of termination
of the Commitments and the date on which there ceases to be any LC Exposure, as well as such
Issuing Bank’s standard fees with respect to the issuance, amendment, renewal or extension of any
Letter of Credit or processing of drawings thereunder. Participation fees and fronting fees
accrued through and including the last day of March, June, September and December of each year
shall be payable on the third Business Day following such last day, commencing on the first such
date to occur after the Effective Date; provided that all such fees shall be payable on the
date on which the Commitments terminate and any such fees accruing after the date on which the
Commitments terminate shall be payable on demand. Any other fees payable to an Issuing Bank
pursuant to this paragraph shall be payable within 10 days after demand. All participation

 

 

 35

fees
and fronting fees shall be computed on the basis of a year of 360 days and shall be payable for the actual
number of days elapsed (including the first day but excluding the last day).

          (c) The Borrower agrees to pay to each Agent, for its own account, fees payable in the amounts
and at the times separately agreed upon between the Borrower and such Agent.

          (d) All fees payable hereunder shall be paid on the dates due, in immediately available funds,
to the Co-Administrative Agent (or to the applicable Issuing Bank, in the case of fees payable to
it) for distribution, in the case of commitment fees and participation fees, to the Lenders
entitled thereto. Fees paid shall not be refundable under any circumstances.

          SECTION 2.11. Interest. (a) The Loans comprising each ABR Borrowing shall bear
interest at the Alternate Base Rate plus the Applicable Rate.

          (b) The Loans comprising each Eurodollar Borrowing shall bear interest at the Adjusted LIBO
Rate for the Interest Period in effect for such Borrowing plus the Applicable Rate.

          (c) Notwithstanding the foregoing, if any principal of or interest on any Loan or any fee or
other amount payable by the Borrower hereunder is not paid when due, whether at stated maturity,
upon acceleration or otherwise, such overdue amount shall bear interest, after as well as before
judgment, at a rate per annum equal to (i) in the case of overdue principal of any Loan, 2% plus
the rate otherwise applicable to such Loan as provided in the preceding paragraphs of this Section
and (ii) in the case of any other amount, 2% plus the rate applicable to ABR Loans as provided in
paragraph (a) of this Section.

          (d) Accrued interest on each Loan shall be payable in arrears on each Interest Payment Date
for such Loan and upon termination of the Commitments; provided that (i) interest accrued
pursuant to paragraph (c) of this Section shall be payable on demand, (ii) in the event of any
repayment or prepayment of any Loan (other than a prepayment of an ABR Loan prior to the end of the
Availability Period), accrued interest on the principal amount repaid or prepaid shall be payable
on the date of such repayment or prepayment and (iii) in the event of any conversion of any
Eurodollar Loan prior to the end of the current Interest Period therefor, accrued interest on such
Loan shall be payable on the effective date of such conversion.

          (e) All interest hereunder shall be computed on the basis of a year of 360 days, except that
interest computed by reference to the Alternate Base Rate at times when the Alternate Base Rate is
based on the Prime Rate shall be computed on the basis of a year of 365 days (or 366 days in a leap
year), and in each case shall be payable for the actual number of days elapsed (including the first
day but excluding the last day). The applicable Alternate Base Rate or Adjusted LIBO Rate shall be
determined by the Co-Administrative Agent, and such determination shall be conclusive absent
manifest error.

          SECTION 2.12. Alternate Rate of Interest. If prior to the commencement of any
Interest Period for a Eurodollar Borrowing:

 

 

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          (a) the Co-Administrative Agent determines (which determination shall be conclusive absent
manifest error) that adequate and reasonable means do not exist for ascertaining the Adjusted LIBO
Rate for such Interest Period; or

          (b) the Co-Administrative Agent is advised by the Required Lenders that the Adjusted LIBO Rate
for such Interest Period will not adequately and fairly reflect the cost to such Lenders of making
or maintaining their Loans included in such Borrowing for such Interest Period;

then the Co-Administrative Agent shall give notice thereof to the Borrower and the Lenders by
telephone or telecopy as promptly as practicable thereafter and, until the Co-Administrative Agent
notifies the Borrower and the Lenders that the circumstances giving rise to such notice no longer
exist, (i) any Interest Election Request that requests the conversion of any Borrowing to, or
continuation of any Borrowing as, a Eurodollar Borrowing shall be ineffective and (ii) if any
Borrowing Request requests a Eurodollar Borrowing, such Borrowing shall be made as an ABR
Borrowing.

          SECTION 2.13. Increased Costs. (a) If any Change in Law shall:

     (i) 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 (except any such reserve requirement reflected in the Adjusted LIBO Rate) or an
Issuing Bank; or

     (ii) impose on any Lender or an Issuing Bank or the London interbank market any other
condition affecting this Agreement or Eurodollar 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 of making or
maintaining any Eurodollar Loan (or of maintaining its obligation to make any such Loan) or to
increase the cost to such Lender or Issuing Bank of participating in, issuing or maintaining any
Letter of Credit or to reduce the amount of any sum received or receivable by such Lender or
Issuing Bank hereunder (whether of principal, interest or otherwise), then the Borrower will pay to
such Lender or Issuing Bank, as the case may be, such additional amount or amounts as will
compensate such Lender or Issuing Bank, as the case may be, for such additional costs incurred or
reduction suffered.

          (b) If any Lender or Issuing Bank determines that any Change in Law regarding capital
requirements has or would have the effect of reducing the rate of return on such Lender’s or
Issuing Bank’s capital or on the capital of such Lender’s or Issuing Bank’s holding company, if any
as a consequence of this Agreement or the Loans made by, or participations in Letters of Credit
held by, such Lender, or the Letters of Credit issued by such Issuing Bank, to a level below that
which such Lender or Issuing Bank or such Lender’s or Issuing Bank’s holding company could have
achieved but for such Change in Law (taking into consideration such Lender’s or Issuing Bank’s
policies and the policies of such Lender’s or Issuing Bank’s holding company with respect to
capital adequacy), then from time to time the Borrower will pay to such

 

 

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Lender or Issuing Bank, as
the case may be, such additional amount or amounts as will compensate such Lender or Issuing Bank or such Lender’s or Issuing Bank’s holding company for
any such reduction suffered.

          (c) A certificate of a Lender or Issuing Bank setting forth the amount or amounts necessary to
compensate such Lender or its holding company or such Issuing Bank or its holding company, as the
case may be, as specified in paragraph (a) or (b) of this Section shall be delivered to the
Borrower and shall be conclusive absent manifest error. The Borrower shall pay such Lender or
Issuing Bank, as the case may be, the amount shown as due on any such certificate within 10 days
after receipt thereof.

          (d) Failure or delay on the part of any Lender or Issuing Bank to demand compensation pursuant
to this Section shall not constitute a waiver of such Lender’s or Issuing Bank’s right to demand
such compensation; provided that the Borrower shall not be required to compensate a Lender
or Issuing Bank pursuant to this Section for any increased costs or reductions incurred more than
270 days prior to the date that such Lender or Issuing Bank, as the case may be, notifies the
Borrower of the Change in Law giving rise to such increased costs or reductions and of such
Lender’s or Issuing Bank’s intention to claim compensation therefor; provided
further that, if the Change in Law giving rise to such increased costs or reductions is
retroactive, then the 270-day period referred to above shall be extended to include the period of
retroactive effect thereof.

          SECTION 2.14. Break Funding Payments. In the event of (a) the payment of any
principal of any Eurodollar Loan other than on the last day of an Interest Period applicable
thereto (including as a result of an Event of Default but excluding any payment pursuant to Section
2.05(b)), (b) the conversion of any Eurodollar Loan other than on the last day of the Interest
Period applicable thereto, (c) the failure to borrow, convert, continue or prepay any Loan on the
date specified in any notice delivered pursuant hereto, or (d) the assignment of any Eurodollar
Loan other than on the last day of the Interest Period applicable thereto as a result of a request
by the Borrower pursuant to Section 2.17, then, in any such event, the Borrower shall compensate
each Lender for the loss, cost and expense attributable to such event. In the case of a Eurodollar
Loan, such loss, cost or expense to any Lender shall be deemed to include an amount determined by
such Lender to be the excess, if any, of (i) the amount of interest which would have accrued on the
principal amount of such Loan had such event not occurred, at the Adjusted LIBO Rate that would
have been applicable to such Loan, for the period from the date of such event to the last day of
the then current Interest Period therefor (or, in the case of a failure to borrow, convert or
continue, for the period that would have been the Interest Period for such Loan), over (ii) the
amount of interest which would accrue on such principal amount for such period at the interest rate
which such Lender would bid were it to bid, at the commencement of such period, for dollar deposits
of a comparable amount and period from other banks in the eurodollar market. A certificate of any
Lender setting forth any amount or amounts that such Lender is entitled to receive pursuant to this
Section shall be delivered to the Borrower and shall be conclusive absent manifest error. The
Borrower shall pay such Lender the amount shown as due on any such certificate within 10 days after
receipt thereof.

          SECTION 2.15. Taxes. (a) Any and all payments by or on account of any obligation
of the Borrower 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

 

 

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Borrower 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
relevant Agent, Lender or Issuing Bank (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 shall make such deductions
and (iii) the Borrower 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 each Agent, each Lender and each Issuing Bank within 10 days
after written demand therefor, for the full amount of any Indemnified Taxes or Other Taxes paid by
such Agent, such Lender or such Issuing Bank, as the case may be, on or with respect to any payment
by or on account of any obligation of the Borrower 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 Issuing Bank, or by an Agent
on its own behalf or on behalf of a Lender or Issuing Bank, shall be conclusive absent manifest
error.

          (d) As soon as practicable after any payment of Indemnified Taxes or Other Taxes by the
Borrower to a Governmental Authority, the Borrower shall deliver to the Co-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 Co-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 Co-Administrative Agent), at the time or times prescribed by
applicable law, such properly completed and executed documentation prescribed by applicable law or
reasonably requested by the Borrower as will permit such payments to be made without withholding or
at a reduced rate, provided that such Foreign Lender has received written notice from the Borrower
advising it of the availability of such exemption or reduction and supplying all applicable
documentation.

          SECTION 2.16. Payments Generally; Pro Rata Treatment; Sharing of Set-offs. (a) The
Borrower shall make each payment required to be made by it hereunder or under any other Loan
Document (whether of principal, interest, fees or reimbursement of LC Disbursements, or of amounts
payable under Section 2.13, 2.14 or 2.15, or otherwise) prior to the time expressly required
hereunder or under such other Loan Document for such payment (or, if no such time is expressly
required, prior to 12:00 noon, New York City time), on the date when due, in immediately available
funds, without set-off or counterclaim. Any amounts received after such time on any date shall be
deemed to have been

 

 

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received
on the next succeeding Business Day for purposes of calculating interest thereon. Unless otherwise specified in any
other Loan Document, all such payments shall be made to the Co-Administrative Agent to such account
as the Co-Administrative Agent shall from time to time specify in a notice delivered to the
Borrower, except for (i) payments to be made directly to an Issuing Bank as expressly provided
herein and (ii) payments pursuant to Sections 2.13, 2.14, 2.15 and 9.03, which shall be made
directly to the Persons entitled thereto. Payments pursuant to other Loan Documents shall be made
to the Persons specified therein. The Co-Administrative Agent shall distribute any such payments
received by it for the account of any other Person to the appropriate recipient promptly following
receipt thereof. If any payment under any Loan Document shall be due on a day that is not a
Business Day, the date for payment shall be extended to the next succeeding Business Day, and, in
the case of any payment accruing interest, interest thereon shall be payable for the period of such
extension. All payments under each Loan Document shall be made in dollars.

          (b) If at any time insufficient funds are received by and available to the Co-Administrative
Agent to pay fully all amounts of principal, unreimbursed LC Disbursements, interest and fees then
due hereunder, such funds shall be applied (i) first, towards payment of interest and fees then due
hereunder, ratably among the parties entitled thereto in accordance with the amounts of interest
and fees then due to such parties, and (ii) second, towards payment of principal and unreimbursed
LC Disbursements then due hereunder, ratably among the parties entitled thereto in accordance with
the amounts of principal and unreimbursed LC Disbursements then due to such parties.

          (c) If any Lender shall, by exercising any right of set-off or counterclaim or otherwise,
obtain payment in respect of any principal of or interest on any of its Loans or participations in
LC Disbursements resulting in such Lender receiving payment of a greater proportion of the
aggregate amount of its Loans and participations in LC Disbursements and accrued interest thereon
than the proportion received by any other Lender, then the Lender receiving such greater proportion
shall purchase (for cash at face value) participations in the Loans and participations in LC
Disbursements of other Lenders to the extent necessary so that the benefit of all such payments
shall be shared by the Lenders ratably in accordance with the aggregate amount of principal of and
accrued interest on their respective Loans and participations in LC Disbursements; provided
that (i) if any such participations are purchased and all or any portion of the payment giving rise
thereto is recovered, such participations shall be rescinded and the purchase price restored to
the extent of such recovery, without interest, and (ii) the provisions of this paragraph shall not
be construed to apply to any payment made by the Borrower pursuant to and in accordance with the
express terms of this Agreement or any payment obtained by a Lender as consideration for the
assignment of or sale of a participation in any of its Loans or participations in LC Disbursements
to any assignee or participant, other than to the Borrower or any Restricted Subsidiary or
Affiliate thereof (as to which the provisions of this paragraph shall apply). The Borrower
consents to the foregoing and agrees, to the extent it may effectively do so under applicable law,
that any Lender acquiring a participation pursuant to the foregoing arrangements may exercise
against the Borrower rights of set-off and counterclaim with respect to such participation as fully
as if such Lender were a direct creditor of the Borrower in the amount of such participation.

          (d) Unless the Co-Administrative Agent shall have received notice from the Borrower prior to
the date on which any payment is due to

 

 

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the
Co-Administrative Agent for the account of the Lenders or an Issuing Bank hereunder that the Borrower will not make such
payment, the Co-Administrative Agent may assume that the Borrower has made such payment on such
date in accordance herewith and may, in reliance upon such assumption, distribute to the Lenders or
the applicable Issuing Bank, as the case may be, the amount due. In such event, if the Borrower
has not in fact made such payment, then each of the Lenders or such Issuing Bank, as the case may
be, severally agrees to repay to the Co-Administrative Agent forthwith on demand the amount so
distributed to such Lender or Issuing Bank with interest thereon, for each day from and including
the date such amount is distributed to it to but excluding the date of payment to the
Co-Administrative Agent, at the greater of the Federal Funds Effective Rate and a rate determined
by the Co-Administrative Agent in accordance with banking industry rules on interbank compensation.

          (e) If any Lender shall fail to make any payment required to be made by it pursuant to Section
2.04(d) or (e), 2.05(b), 2.16(d) or 9.03(c), then the Co-Administrative Agent may, in its
discretion (notwithstanding any contrary provision hereof), apply any amounts thereafter received
by the Co-Administrative Agent for the account of such Lender to satisfy such Lender’s obligations
under such Sections until all such unsatisfied obligations are fully paid.

          SECTION 2.17. Mitigation Obligations; Replacement of Lenders. (a) If any Lender
requests compensation under Section 2.13, or if the Borrower is required to pay any additional
amount to any Lender or any Governmental Authority for the account of any Lender pursuant to
Section 2.15, then such Lender shall use reasonable efforts to designate a different lending office
for funding or booking its Loans hereunder or to assign its rights and obligations hereunder to
another of its offices, branches or affiliates, if, in the judgment of such Lender, such
designation or assignment (i) would eliminate or reduce amounts payable pursuant to Section 2.13 or
2.15, as the case may be, in the future and (ii) would not subject such Lender to any unreimbursed
cost or expense and would not otherwise be disadvantageous to such Lender. The Borrower hereby
agrees to pay all reasonable costs and expenses incurred by any Lender in connection with any such
designation or assignment.

          (b) If any Lender requests compensation under Section 2.13, or if the Borrower is required to
pay any additional amount to any Lender or any Governmental Authority for the account of any Lender
pursuant to Section 2.15, or if any Lender defaults in its obligation to fund Loans hereunder, then
the Borrower may, at its sole expense and effort, upon notice to such Lender and the
Co-Administrative Agent, require such Lender to assign and delegate, without recourse (in
accordance with and subject to the restrictions contained in Section 9.04), all its interests,
rights and obligations under this Agreement to an assignee that shall assume such obligations
(which assignee may be another Lender, if a Lender accepts such assignment); provided that
(i) the Borrower shall have received the prior written consent of the Co-Administrative Agent and
each Issuing Bank, which consent shall not unreasonably be withheld, (ii) such Lender shall have
received payment of an amount equal to the outstanding principal of its Loans and participations in
LC Disbursements, accrued interest thereon, accrued fees and all other amounts payable to it
hereunder, from the assignee (to the extent of such outstanding principal and accrued interest and
fees) or the Borrower (in the case of all other amounts) and (iii) in the case of any such
assignment resulting from a claim for compensation under Section 2.13 or payments

 

 

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required to be
made pursuant to Section 2.15, such assignment will result in a material reduction in such compensation or payments. A Lender shall not be
required to make any such assignment and delegation if, prior thereto, as a result of a waiver by
such Lender or otherwise, the circumstances entitling the Borrower to require such assignment and
delegation cease to apply.

          SECTION 2.18. Increase in Commitments. At any time after the Effective Date the
Borrower may, by written notice to the Administrative Agent, executed by the Borrower and one or
more financial institutions, which may include any existing Lender (any such financial institutions
being called a “Prospective Lender”), cause the Commitments of the Prospective Lenders to
be increased (or cause Commitments to be extended by the Prospective Lenders, as the case may be)
in an amount for each Prospective Lender set forth in such notice; provided,
however, that (a) the aggregate amount of the Lenders’ Commitments after giving effect to
such increase shall in no event exceed $400,000,000, (b) each Prospective Lender, if not already a
Lender hereunder, shall be subject to the approval of the Administrative Agent (not to be
unreasonably withheld), (c) each Prospective Lender, if not already a Lender hereunder, shall
become a party to this Agreement by completing and delivering to the Administrative Agent a duly
executed Accession Agreement and (d) no existing Lender shall be required to become a Prospective
Lender. Increases and new Commitments created pursuant to this Section shall become effective (A)
in the case of Prospective Lenders already parties hereunder, on the date specified in the notice
delivered pursuant to this Section and (B) in the case of Prospective Lenders not already parties
hereunder, on the effective date of the Accession Agreement. Upon the effectiveness of any
Accession Agreement to which any Prospective Lender is a party, (i) such Prospective Lender shall
thereafter be deemed to be a party to this Agreement and shall be entitled to all rights, benefits
and privileges accorded a Lender hereunder and subject to all obligations of a Lender hereunder and
(ii) Schedule 2.01 shall be deemed to have been amended to reflect the Commitment of the
Prospective Lender as provided in such Accession Agreement. Upon the effectiveness of any increase
pursuant to this Section in the Commitment of a Lender already a party hereunder, Schedule 2.01
shall be deemed to have been amended to reflect the increased Commitment of such Lender.
Notwithstanding the foregoing, no increase in the aggregate Commitments (or in the Commitment of
any Lender) shall become effective under this Section unless, on the date of such increase, (i) the
conditions set forth in paragraphs (a) and (b) of Section 4.02 shall be satisfied (with all
references in such paragraphs to a Borrowing being deemed to be references to such increase), (ii)
the Borrower is in Pro Forma Compliance, after giving effect to any such increase and other
customary and appropriate pro forma adjustment events, including any acquisitions or dispositions
or repayment of indebtedness after the beginning of the relevant determination period but prior to
or simultaneous with the effectiveness of any such increase, and (iii) the Administrative Agent
shall have received a certificate dated such date and executed by a Financial Officer of the
Borrower that the conditions in the foregoing clauses (i) and (ii) have been satisfied as of such
date. Following any increase of a Lender’s Commitment or any extension of a new Commitment
pursuant to this paragraph, any Loans outstanding prior to the effectiveness of such increase or
extension shall continue outstanding until the ends of the respective Interest Periods applicable
thereto, and shall then be repaid or refinanced with new Loans made pursuant to Sections 2.01 and
2.02; provided that upon the occurrence of any Default, each Prospective Lender shall
purchase (for cash at face value) participations in the Loans of other Lenders to the extent
necessary so that all Loans outstanding are owned by the Lenders ratably in accordance with their
respective Commitments.

 

 

42

ARTICLE III

Representations and Warranties

          The Borrower represents and warrants to the Lenders that:

          SECTION 3.01. Organization; Powers. Each of the Borrower and the Restricted
Subsidiaries is duly organized, validly existing and in good standing under the laws of the
jurisdiction of its organization, has all requisite power and authority to carry on its business as
now conducted and, except where the failure to do so, individually or in the aggregate, could not
reasonably be expected to result in a Material Adverse Effect, is qualified to do business in, and
is in good standing in, every jurisdiction where such qualification is required.

          SECTION 3.02. Authorization; Enforceability. The Transactions to be entered into by
each Loan Party are within such Loan Party’s corporate or other powers and have been duly
authorized by all necessary action, including, if required, stockholder or member action. This
Agreement has been duly executed and delivered by the Borrower and constitutes, and each other Loan
Document to which any Loan Party is to be a party, when executed and delivered by such Loan Party,
will constitute, a legal, valid and binding obligation of the Borrower or such Loan Party (as the
case may be), enforceable in accordance with its terms, subject to applicable bankruptcy,
insolvency, reorganization, moratorium or other laws affecting creditors’ rights generally and
subject to general principles of equity, regardless of whether considered in a proceeding in equity
or at law.

          SECTION 3.03. Governmental Approvals; No Conflicts. The Transactions (a) do not
require any consent or approval of, registration or filing with, or any other action by, any
Governmental Authority, except such as have been obtained or made and are in full force and effect
and except filings necessary to perfect Liens created under the Loan Documents, (b) will not
violate any applicable law or regulation or the charter, by-laws or other organizational documents
of the Borrower or any of its Restricted Subsidiaries or any order of any Governmental Authority,
(c) will not violate or result in a default under any material indenture, agreement or other
instrument binding upon the Borrower or any of the Subsidiaries or its assets, or give rise to a
right thereunder to require any material payment to be made by the Borrower or any of the
Subsidiaries, and (d) except for Disclosed Matters and as may be required by the Senior Second Lien
Note Documents, will not result in the creation or imposition of any Lien on any asset of the
Borrower or any of its Restricted Subsidiaries, except Liens created under the Loan Documents.

          SECTION 3.04. Financial Condition; No Material Adverse Change. (a) The Borrower has
heretofore furnished to the Lenders its consolidated balance sheet and consolidated statements of
operations, equities and cash flows (i) as of and for the fiscal year ended December 31, 2005,
reported on by KPMG LLP, an independent registered public accounting firm, and (ii) as of and for
the fiscal quarter and the portion of the fiscal year ended June 30, 2006, certified by its chief
financial officer. Such financial statements present fairly, in all material respects, the
financial position and results of operations and cash flows of the Borrower and its consolidated
Subsidiaries as of such dates and

 

43

for such
periods in accordance with GAAP, subject to year-end audit adjustments and the absence of footnotes in the case of the
statements referred to in clause (ii) above.

          (b) Except as disclosed in the financial statements referred to above or the notes thereto or
in the Information Memorandum and except for the Disclosed Matters, after giving effect to the
Transactions, none of the Borrower or its Restricted Subsidiaries has, as of the Effective Date,
any material contingent liabilities, unusual long-term commitments or significant unrealized
losses.

          (c) Since December 31, 2005, there has been no material adverse change in the business,
operations, assets, properties, liabilities or condition, financial or otherwise, of the Borrower
and the Restricted Subsidiaries, taken as a whole.

          SECTION 3.05. Properties. (a) Each of the Borrower and the Restricted Subsidiaries
has good title to, or valid leasehold interests in, all its real and personal property material to
its business (including its Mortgaged Properties), except for Liens permitted by Section 6.02.

          (b) Each of the Borrower and its Restricted Subsidiaries owns, or is licensed to use, all
trademarks, tradenames, copyrights, patents and other intellectual property material to its
business, and the use thereof by the Borrower and the Restricted Subsidiaries does not infringe
upon the rights of any other Person, except for any such infringements that, individually or in the
aggregate, could not reasonably be expected to result in a Material Adverse Effect.

          (c) Schedule 3.05 sets forth the address of each real property that is owned or leased by the
Borrower or any of the Subsidiary Loan Parties as of the Effective Date.

          (d) As of the Effective Date, neither the Borrower nor any of the Restricted Subsidiaries has
received notice of, or has knowledge of, any pending or contemplated condemnation proceeding
affecting any Mortgaged Property or any sale or disposition thereof in lieu of condemnation.
Neither any Mortgaged Property nor any interest therein is subject to any right of first refusal,
option or other contractual right to purchase such Mortgaged Property or interest therein.

          SECTION 3.06. Litigation and Environmental Matters. (a) There are no actions,
suits or proceedings by or before any arbitrator or Governmental Authority pending against or, to
the knowledge of the Borrower, threatened against or affecting the Borrower or any of its
Subsidiaries (i) 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 (other than the Disclosed Matters) or (ii) that involve any of
the Loan Documents or the Transactions.

          (b) Except for the Disclosed Matters and except with respect to any other matters that,
individually or in the aggregate, could not reasonably be expected to result in a Material Adverse
Effect, neither the Borrower nor any of its Subsidiaries (i) has failed to comply with any
Environmental Law or to obtain, maintain or comply with any permit, license or other approval
required under any Environmental Law, (ii) has

 

44

become
subject to any Environmental Liability, (iii) has received notice of any claim with respect to any Environmental Liability or (iv)
knows of any basis for any Environmental Liability.

          (c) Since the date of this Agreement, there has been no change in the status of the Disclosed
Matters that, individually or in the aggregate, has resulted in, or materially increased the
likelihood of, a Material Adverse Effect.

          SECTION 3.07. Compliance with Laws and Agreements. Each of the Borrower and its
Subsidiaries is in compliance with all laws, regulations and orders of any Governmental Authority
applicable to it or its property and all indentures, agreements and other instruments binding upon
it or its property, except where the failure to do so, individually or in the aggregate, could not
reasonably be expected to result in a Material Adverse Effect. No Default has occurred and is
continuing.

          SECTION 3.08. Investment Company Status. Neither the Borrower nor any of its
Subsidiaries is an “investment company” as defined in, or subject to regulation under, the
Investment Company Act of 1940.

          SECTION 3.09. Taxes. Each of the Borrower and its Subsidiaries has timely filed or
caused to be filed all Tax returns and reports required to have been filed and has paid or caused
to be paid all Taxes required to have been paid by it, except (a) any Taxes that are being
contested in good faith by appropriate proceedings and for which the Borrower or such Subsidiary,
as applicable, has set aside on its books adequate reserves or (b) to the extent that the failure
to do so could not reasonably be expected to result in a Material Adverse Effect.

          SECTION 3.10. ERISA. No ERISA Event has occurred or is reasonably expected to occur
that, when taken together with all other such ERISA Events for which liability is reasonably
expected to occur, could reasonably be expected to result in a Material Adverse Effect. The
present value of all accumulated benefit obligations under each Plan (based on the assumptions used
for purposes of Statement of Financial Accounting Standards No. 87) did not, as of the date of the
most recent financial statements reflecting such amounts, exceed by more than $50,000,000 the fair
market value of the assets of such Plan.

          SECTION 3.11. Disclosure. The Borrower has disclosed to the Lenders all agreements,
instruments and corporate or other restrictions to which the Borrower or any of the Restricted
Subsidiaries is subject, and all other matters known to any of them, that, individually or in the
aggregate, could reasonably be expected to result in a Material Adverse Effect. Neither the
Information Memorandum nor any of the other reports, financial statements, certificates or other
information furnished by or on behalf of any Loan Party to the Co-Administrative Agent or any
Lender in connection with the negotiation of this Agreement or any other Loan Document or delivered
hereunder or thereunder (as modified or supplemented by other information so furnished) contains
any material misstatement of fact or omits to state any material fact necessary to make the
statements therein, in the light of the circumstances under which they were made, not misleading;
provided that, with respect to projected financial information, the Borrower represent only
that such information was prepared in good faith based upon assumptions believed to be reasonable
at the time.

 

45

          SECTION 3.12. Subsidiaries. Schedule 3.12 sets forth the name of, and the ownership
interest of the Borrower in, each Subsidiary of the Borrower and identifies each Subsidiary that is
a Subsidiary Loan Party, in each case as of the Effective Date.

          SECTION 3.13. Insurance. Schedule 3.13 sets forth a description of all insurance
maintained by or on behalf of the Borrower and the Restricted Subsidiaries as of the Effective
Date. As of the Effective Date, all premiums in respect of such insurance have been paid. The
Borrower believes that the insurance maintained by or on behalf of the Borrower and the Restricted
Subsidiaries is adequate.

          SECTION 3.14. Labor Matters. Except as, in the aggregate, could not reasonably be
expected to have a Material Adverse Effect: (a) as of the Effective Date, there are no strikes,
lockouts or slowdowns against the Borrower or any Restricted Subsidiary pending or, to the
knowledge of the Borrower, threatened, (b) all payments due from the Borrower or any Restricted
Subsidiary, or for which any claim may be made against the Borrower or any Restricted 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 Restricted Subsidiary and (c) 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 Restricted Subsidiary is bound.

          SECTION 3.15. Solvency. Immediately after the consummation of the Transactions to
occur on the Effective Date and immediately following the making of each Loan made on the Effective
Date and after giving effect to the application of the proceeds of such Loans and to the rights of
subrogation and contribution under the Subsidiary Loan Parties’ guarantee of the Obligations, (a)
the fair value of the assets of each Loan Party, at a fair valuation, will exceed its debts and
liabilities, subordinated, contingent or otherwise; (b) the present fair saleable value of the
property of each Loan Party will be greater than the amount that will be required to pay the
probable liability of its debts and other liabilities, subordinated, contingent or otherwise, as
such debts and other liabilities become absolute and matured; (c) each Loan Party will be able to
pay its debts and liabilities, subordinated, contingent or otherwise, as such debts and liabilities
become absolute and matured; and (d) each Loan Party will not have unreasonably small capital with
which to conduct the business in which it is engaged as such business is now conducted and is
proposed to be conducted following the Effective Date.

          SECTION 3.16. Patronage Payments. All claims by members for cash payments of
patronage dividends, revolvements and redemptions under applicable laws, including the U.S.
Bankruptcy Code and Rules, are claims in respect of equity interests and will rank junior in right
of payment to all Obligations under this Agreement.

ARTICLE IV

Conditions

          SECTION 4.01. Effective Date. The obligations of the Lenders to make Loans and of
each Issuing Bank to issue Letters of Credit

 

46

hereunder
shall not become effective until the date on which each of the following conditions is satisfied (or waived in accordance with
Section 9.02):

          (a) The Administrative Agent (or its counsel) shall have received from each party hereto
either (i) a counterpart of this Agreement signed on behalf of such party or (ii) written evidence
reasonably satisfactory to the Administrative Agent (which may include telecopy or electronic image
scan transmission of a signed signature page of this Agreement) that such party has signed a
counterpart of this Agreement.

          (b) The Administrative Agent shall have received a favorable written opinion (addressed to the
Administrative Agent and the Lenders and dated the Effective Date) of each of (i) Faegre & Benson
LLP, outside counsel for the Borrower, substantially in the form of Exhibit B-1 and (ii) Peter
Janzen, general counsel for the Borrower, substantially in the form of Exhibit B-2, and, in the
case of each such opinion required by this paragraph, covering such other matters relating to the
Loan Parties, the Loan Documents or the Transactions as the Required Lenders shall reasonably
request. The Borrower hereby requests such counsel to deliver such opinions.

          (c) The Administrative Agent shall have received such documents and certificates as the
Administrative Agent or its counsel may reasonably request relating to the organization, existence
and good standing of each Loan Party, the authorization of the Transactions and any other legal
matters relating to the Loan Parties, the Loan Documents or the Transactions, all in form and
substance reasonably satisfactory to the Administrative Agent and its counsel.

          (d) The Administrative Agent shall have received a certificate, dated the Effective Date and
signed by the President, a Vice President or a Financial Officer of the Borrower, confirming
compliance with the conditions set forth in paragraphs (a) and (b) of Section 4.02.

          (e) The Administrative Agent shall have received all fees and other amounts due and payable on
or prior to the Effective Date, including, to the extent invoiced, reimbursement or payment of all
out-of-pocket expenses (including fees, charges and disbursements of counsel) required to be
reimbursed or paid by any Loan Party hereunder or under any other Loan Document.

          (f) The Collateral and Guarantee Requirement shall have been satisfied and the Collateral
Agent shall have received a completed Perfection Certificate dated the Effective Date and signed by
an executive officer or Financial Officer of the Borrower, together with all attachments
contemplated thereby, including the results of a search of the Uniform Commercial Code (or
equivalent) filings made with respect to the Loan Parties in the jurisdictions contemplated by the
Perfection Certificate and copies of the financing statements (or similar documents) disclosed by
such search and evidence reasonably satisfactory to the Collateral Agent that the Liens indicated
by such financing statements (or similar documents) are permitted by Section 6.02 or have been
released.

 

47

          (g) The Administrative Agent shall have received evidence that the insurance required by
Section 5.07 and the Security Documents is in effect.

          (h) All accrued and unpaid fees and expenses subject to payment or reimbursement under the
Existing Credit Agreement shall have been paid.

          (i) The Lenders shall have received all documentation and other information required by bank
regulatory authorities under applicable “know your customer” and anti-money laundering rules and
regulations, including the U.S.A. Patriot Act.

To the extent there are any Loans or LC Disbursements (each as defined in the Existing Credit
Agreement) outstanding on the Effective Date, the Lenders shall purchase and sell assignments
therein as directed by the Administrative Agent such that, after giving effect to such assignments,
each Lender shall hold a portion of each outstanding Loan and/or LC Disbursement under this
Agreement equal to its Applicable Percentage of all such Loans and/or LC Disbursements. All such
assignments shall be deemed to be effected pursuant to Section 9.04(b) on the Effective Date;
provided that no recordation or processing fee shall be required to be paid by any Lender
in respect of such assignments under Section 9.04(b).

The Administrative Agent shall notify the Borrower and the Lenders of the Effective Date, and such
notice shall be conclusive and binding. Notwithstanding the foregoing, the obligations of the
Lenders to make Loans and of the Issuing Banks to issue Letters of Credit hereunder shall not
become effective unless each of the foregoing conditions is satisfied (or waived pursuant to
Section 9.02) at or prior to 5:00 p.m., New York City time, on October 2, 2006 (and, in the event
such conditions are not so satisfied or waived, the Commitments shall terminate at such time).

          SECTION 4.02. Each Credit Event. The obligation of each Lender to make a Loan on the
occasion of any Borrowing and of an Issuing Bank to issue, amend, renew or extend any Letter of
Credit, is subject to receipt of the request therefor in accordance herewith and to the
satisfaction of the following conditions:

          (a) The representations and warranties of each Loan Party set forth in the Loan Documents
qualified as to materiality shall be true and correct and the representations and warranties of
each Loan Party set forth in the Loan Documents not qualified as to materiality shall be true and
correct in all material respects, in each case on and as of the date of such Borrowing or the date
of issuance, amendment, renewal or extension of such Letter of Credit, as applicable, except to the
extent that such representations and warranties specifically refer to an earlier date, in which
case they shall be true and correct, or true and correct in all material respects, as applicable,
as of such earlier date.

          (b) At the time of and immediately after giving effect to such Borrowing or the issuance,
amendment, renewal or extension of such Letter of Credit, as applicable, no Default shall have
occurred and be continuing.

Each Borrowing and each issuance, amendment, renewal or extension of a Letter of Credit shall be
deemed to constitute a representation and warranty by the Borrower on the date thereof as to the
matters specified in paragraphs (a) and (b) of this Section.

 

48

ARTICLE V

Affirmative Covenants

          Until the Commitments have expired or been terminated and the principal of and interest on
each Loan and all fees payable hereunder shall have been paid in full and all Letters of Credit
shall have expired or terminated and all LC Disbursements shall have been reimbursed, the Borrower
covenants and agrees with the Lenders that:

          SECTION 5.01. Financial Statements and Other Information. The Borrower will furnish
to the Co-Administrative Agent and each Lender:

          (a) within 90 days after the end of each fiscal year of the Borrower, an audited consolidated
balance sheet of the Borrower and the Restricted Subsidiaries and related statements of operations
and cash flows as of the end of and for such year, setting forth in each case in comparative form
the figures for the previous fiscal year, all reported on by KPMG LLP or another independent
registered public accounting firm of recognized national standing (without a “going concern” or
like qualification or exception and without any qualification or exception as to the scope of such
audit) to the effect that such consolidated financial statements present fairly in all material
respects the financial condition and results of operations of the Borrower and the Restricted
Subsidiaries on a consolidated basis in accordance with GAAP consistently applied; provided
that so long as the Borrower (i) files an annual Form 10-K with the Securities and Exchange
Commission, and (ii) such Form 10-K contains financial statements, opinions or certificates
required by the foregoing provisions, the delivery of such Form 10-K shall satisfy the requirement
of this Section 5.01(a);

          (b) within 45 days after the end of each of the first three fiscal quarters of each fiscal
year of the Borrower, an unaudited consolidated balance sheet of the Borrower and the Restricted
Subsidiaries and related statements of operations and cash flows as of the end of and for such
fiscal quarter and the then elapsed portion of the fiscal year, setting forth in each case in
comparative form the figures for the corresponding period or periods of (or, in the case of the
balance sheet, as of the end of) the previous fiscal year, all certified by one of its Financial
Officers as presenting fairly in all material respects the financial condition and results of
operations of the Borrower and the Restricted Subsidiaries on a consolidated basis in accordance
with GAAP consistently applied, subject to normal year-end audit adjustments and the absence of
footnotes; provided that so long as the Borrower (i) files a quarterly Form 10-Q with the
Securities and Exchange Commission, and (ii) such Form 10-Q contains financial statements, opinions
or certificates required by the foregoing provisions, the delivery of such Form 10-Q shall satisfy
the requirement of this Section 5.01(b);

          (c) concurrently with any delivery of financial statements under clause (a) or (b) above, a
certificate of a Financial Officer of the Borrower (i) certifying as to whether a Default has
occurred and, if a Default has occurred, specifying the details thereof and any action taken or
proposed to be taken with respect thereto, (ii) setting forth reasonably detailed calculations
demonstrating compliance with Sections 6.12 and 6.13, (iii) stating whether any change in GAAP or
in the application thereof has occurred since the date of the Borrower’s audited financial

 

49

statements
referred to in Section 3.04 and, if any such change has occurred, specifying the effect of such change on the financial statements accompanying such
certificate, (iv) identifying any Restricted Subsidiary formed or acquired since the end of the
previous fiscal quarter, (v) identifying any parcels of real property or improvements thereto with
a value exceeding $2,000,000 that have been acquired by any Loan Party since the end of the
previous fiscal quarter, (vi) identifying any changes of the type described in Section 5.03(a) that
have not been previously reported by the Borrower, (vii) identifying any acquisitions of going
concerns and Joint Ventures that have been consummated since the end of the previous fiscal
quarter, including the date on which each such acquisition or Joint Venture was consummated and the
consideration therefor, (viii) identifying any material Intellectual Property (as defined in the
Collateral Agreement) with respect to which a notice is required to be delivered under the
Collateral Agreement and has not been previously delivered and (ix) setting forth reasonably
detailed calculations determining the amount of Restricted Payments or Repurchase Expenditures, as
the case may be, that the Borrower was permitted to make under Section 6.08(a)(ii), 6.08(b)(iv) and
6.08(b)(vii), as of the date of the financial statements which such certificate is delivered in
connection with;

          (d) concurrently with any delivery of financial statements under clause (a) above, a
certificate of the accounting firm that reported on such financial statements stating whether they
obtained knowledge during the course of their examination of such financial statements of any
Default (which certificate may be limited to the extent required by accounting rules or
guidelines);

          (e) 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 Restricted 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 by
the Borrower to its shareholders generally, as the case may be; and

          (f) promptly following any request therefor, such other information regarding the operations,
business affairs and financial condition of the Borrower or any Restricted Subsidiary, or
compliance with the terms of any Loan Document, as the Co-Administrative Agent or any Lender may
reasonably request.

Information required to be delivered pursuant to this Section 5.01 shall be deemed to have been
delivered if such information, or one or more annual or quarterly reports containing such
information, shall have been posted by the Co-Administrative Agent on an IntraLinks or similar site
to which the Lenders have been granted access or shall be available on the website of the
Securities and Exchange Commission at http://www.sec.gov; provided that the Borrower shall
deliver paper copies of such information to any Lender that requests such delivery. Information
required to be delivered pursuant to this Section 5.01 may also be delivered by electronic
communications pursuant to procedures approved by the Co-Administrative Agent.

          SECTION 5.02. Notices of Material Events. (a) The Borrower will furnish to each
Agent and each Lender prompt written notice of the following:

     (i) the occurrence of any Default;

 

50

     (ii) the filing or commencement of any action, suit or proceeding by or before any
arbitrator or Governmental Authority against or affecting the Borrower or any Affiliate
thereof as to which there is a reasonable possibility of an adverse determination and which,
if adversely determined, could reasonably be expected to result in a Material Adverse
Effect;

     (iii) the occurrence of any ERISA Event that, alone or together with any other ERISA
Events that have occurred, could reasonably be expected to result in a Material Adverse
Effect; and

     (iv) any other development that results in, or could reasonably be expected to result
in, a Material Adverse Effect.

Each notice delivered under this Section 5.02(a) shall be accompanied by a statement of a Financial
Officer or other executive officer of the Borrower setting forth the details of the event or
development requiring such notice and any action taken or proposed to be taken with respect
thereto.

          (b) The Borrower will furnish to each Agent prompt written notice of (i) the creation of any
Securitization by the Borrower or any Restricted Subsidiary that is not a Nonrecourse
Securitization and (ii) the amendment by the Borrower or any Restricted Subsidiary of an existing
Nonrecourse Securitization, or the occurrence of any other event related to an existing Nonrecourse
Securitization, such that such Securitization is no longer a Nonrecourse Securitization. Each
notice delivered under this Section 5.02(b) shall be accompanied by a statement of a Financial
Officer or other executive officer of the Borrower setting forth the details of the event or
development requiring such notice.

          SECTION 5.03. Information Regarding Collateral. (a) The Borrower will furnish to the
Collateral Agent prompt written notice of any change (i) in any Loan Party’s corporate name or in
the ownership of its properties, (ii) in the location of any Loan Party’s chief executive office,
any office in any jurisdiction that has not adopted Revised Article 9 of the Uniform Commercial
Code in which it maintains books or records relating to Collateral owned by it or at which
Collateral owned by it is located (including the establishment of any such new office or facility),
(iii) in any Loan Party’s identity or corporate structure or (iv) in any Loan Party’s Federal
Taxpayer Identification Number or organization number, if any, assigned by the jurisdiction under
the laws of which it is organized. The Borrower agrees not to effect or permit any change referred
to in the preceding sentence unless all filings have been made under the Uniform Commercial Code or
otherwise that are required in order for the Collateral Agent to continue at all times following
such change to have a valid, legal and perfected security interest in all the Collateral in which a
security interest can be perfected by filing. The Borrower also agrees promptly to notify the
Collateral Agent if any material portion of the Collateral is damaged or destroyed.

          (b) Each year, at the time of delivery of annual financial statements with respect to the
preceding fiscal year pursuant to clause (a) of Section 5.01, the Borrower shall deliver to the
Collateral Agent a certificate of a Financial Officer and the chief legal officer of the Borrower

 

51

setting
forth the information required pursuant to Section 2 of the Perfection Certificate or confirming that there has been no change in such information since the date of
the Perfection Certificate delivered on the Effective Date or the date of the most recent
certificate delivered pursuant to this Section.

          SECTION 5.04. Existence; Conduct of Business. The Borrower will, and will cause each
of its Restricted Subsidiaries to, do or cause to be done all things necessary to preserve, renew
and keep in full force and effect its legal existence and the rights, licenses, permits,
privileges, franchises, patents, copyrights, trademarks and trade names material to the conduct of
its business; provided that the foregoing shall not prohibit any merger, consolidation,
liquidation or dissolution permitted under Section 6.03.

          SECTION 5.05. Payment of Obligations. The Borrower will, and will cause each of its
Restricted Subsidiaries to, pay its obligations, including Tax liabilities, before the same shall
become delinquent or in default, except where (a) the validity or amount thereof is being contested
in good faith by appropriate proceedings, (b) the Borrower or such Restricted Subsidiary has set
aside on its books adequate reserves with respect thereto in accordance with GAAP, and (c) the
failure to make payment pending such contest could not reasonably be expected to result in a
Material Adverse Effect; provided that any failure to pay Indebtedness shall only constitute an
Event of Default as provided in Article VII.

          SECTION 5.06. Maintenance of Properties. The Borrower will, and will cause each of
its Restricted Subsidiaries to, keep and maintain all property material to the conduct of its
business in good working order and condition, ordinary wear and tear excepted.

          SECTION 5.07. Insurance. The Borrower will, and will cause each of its Restricted
Subsidiaries to, maintain, with financially sound and reputable insurance companies (a) insurance
in such amounts (with no greater risk retention) and against such risks as are customarily
maintained by companies of established repute engaged in the same or similar businesses operating
in the same or similar locations and (b) all insurance required to be maintained pursuant to the
Security Documents (to the extent such requirements are then in effect, in accordance with Section
9.14). The Borrower will furnish to the Lenders, upon request of the Collateral Agent, information
in reasonable detail as to the insurance so maintained.

          SECTION 5.08. Casualty and Condemnation. The Borrower (a) will furnish to the
Collateral Agent and the Lenders prompt written notice of any casualty or other insured damage to
any material portion of any Collateral or the commencement of any action or proceeding for the
taking of any Collateral or any part thereof or interest therein under power of eminent domain or
by condemnation or similar proceeding and (b) will ensure that the net proceeds of any such event
(whether in the form of insurance proceeds, condemnation awards or otherwise) are collected and
applied in accordance with the applicable provisions of the Security Documents.

          SECTION 5.09. Books and Records; Inspection and Audit Rights. The Borrower will, and
will cause each of its Restricted Subsidiaries to, keep proper books of record and account in which
full, true and correct entries are made of all dealings and transactions in relation to its
business and activities. The Borrower will, and will cause each of its Restricted Subsidiaries to,
permit (subject to the provisions of

 

52

Section 9.12)
any representatives designated by the Co-Administrative Agent, the Collateral Agent or any Lender, upon reasonable prior
notice, to visit and inspect its properties, to examine and make extracts from its books and
records, and to discuss its affairs, finances and condition with its officers and independent
accountants, all at such reasonable times and as often as reasonably requested.

          SECTION 5.10. Compliance with Laws. The Borrower will, and will cause each of its
Subsidiaries to, comply with all laws, rules, regulations and orders of any Governmental Authority
applicable to it or its property, except where the failure to do so, individually or in the
aggregate, could not reasonably be expected to result in a Material Adverse Effect.

          SECTION 5.11. Use of Proceeds and Letters of Credit. The proceeds of the Loans made
on the Effective Date shall be used to repay borrowings and pay any accrued and unpaid fees under
the Existing Credit Agreement, pay other fees and expenses in connection with the Transactions and
for working capital and other general corporate purposes. The proceeds of the Loans made after the
Effective Date will be used only for working capital and other general corporate purposes. No part
of the proceeds of any Loan will be used, whether directly or indirectly, for any purpose that
entails a violation of any of the Regulations of the Board, including Regulations T, U and X.
Letters of Credit will be used only to support the activities of the Borrower and its Affiliates in
the ordinary course of their business, for general corporate purposes.

          SECTION 5.12. Additional Subsidiaries. If any additional Restricted Subsidiary is
formed or acquired after the Effective Date, the Borrower will, within ten Business Days after such
Restricted Subsidiary is formed or acquired, notify the Collateral Agent and the Lenders thereof
and within fifteen Business Days after such Restricted Subsidiary is formed or acquired, cause the
Collateral and Guarantee Requirement to be satisfied with respect to such Restricted Subsidiary (if
it is a Subsidiary Loan Party) and, if a Collateral Release Period is not in effect, with respect
to any Equity Interest in or Indebtedness of such Restricted Subsidiary owned by or on behalf of
any Loan Party.

          SECTION 5.13. Further Assurances. (a) The Borrower will, and will cause each
Subsidiary Loan Party to, execute any and all further documents, financing statements, agreements
and instruments, and take all such further actions (including the filing and recording of financing
statements, fixture filings, mortgages, deeds of trust and other documents), which may be required
under any applicable law, or which either Agent or the Required Lenders may reasonably request, to
cause the Collateral and Guarantee Requirement to be and remain satisfied, all at the expense of
the Loan Parties. The Borrower also agrees to provide to the Collateral Agent, from time to time
upon request, evidence reasonably satisfactory to the Collateral Agent to enable the Collateral
Agent to confirm the perfection and priority of the Liens created or intended to be created by the
Security Documents.

          (b) If any material assets (including any real property or improvements thereto or any
interest therein having a fair market value (including fixtures) of $2,000,000 or more, but
excluding Collateral of a type not otherwise covered by the Security Documents) are acquired by the
Borrower or any Subsidiary Loan Party after the Effective Date (other than assets constituting
Collateral under the Collateral Agreement that become subject to the Lien of the Collateral
Agreement upon acquisition thereof), the Borrower will notify the Collateral Agent

 

53

and the Lenders thereof, and, if reasonably requested by the Collateral Agent or the Required
Lenders, the Borrower will cause such assets to be subjected to a Lien securing the Obligations and
will take, and cause the Subsidiary Loan Parties to take, such actions as shall be necessary or
reasonably requested by the Collateral Agent to grant and perfect such Liens, including actions
described in paragraph (a) of this Section, all at the expense of the Loan Parties.

          (c) The Borrower and the Subsidiary Loan Parties shall, not later than the tenth day after the
Effective Date, deliver to the Collateral Agent all promissory notes and other instruments in their
possession evidencing Indebtedness of Subsidiaries and third parties that is owing to the Borrower
or any Subsidiary Loan Party, together with instruments of transfer with respect thereto endorsed
in blank. In the event that any promissory notes or other instruments evidencing Indebtedness of
Subsidiaries or third parties in existence on the Effective Date come into the Borrower’ s or a
Subsidiary Loan Party’s possession after the Effective Date, or in the event that promissory notes
evidencing any additional Indebtedness of Subsidiaries or third parties is held by the Borrower or
a Subsidiary Loan Party after the Effective Date, such promissory notes or other instruments shall
be promptly delivered to the Collateral Agent and pledged under the Collateral Agreement. The
Borrower and each Subsidiary Loan Party agrees that no promissory notes or other instruments
evidencing Indebtedness of Subsidiaries or third parties owed to the Borrower or any Subsidiary
Loan Party shall ever be held by any Person other than the Borrower, a Subsidiary Loan Party or the
Collateral Agent.

ARTICLE VI

Negative Covenants

          Until the Commitments have expired or terminated and the principal of and interest on each
Loan and all fees payable hereunder have been paid in full and all Letters of Credit have expired
or terminated and all LC Disbursements shall have been reimbursed, the Borrower covenants and
agrees with the Lenders that:

          SECTION 6.01. Indebtedness; Certain Equity Securities. (a) The Borrower will not,
and will not permit any Restricted Subsidiary to, create, incur, assume or permit to exist any
Indebtedness, Attributable Debt or Funded Receivables Sales, except:

     (i) Indebtedness created under the Loan Documents;

     (ii) the Senior Notes in an aggregate amount not in excess of $196,452,000 at any time
outstanding, the Senior Second Lien Notes in an aggregate amount not in excess of
$200,000,000 at any time outstanding, and, in each case, related Guarantees by Subsidiary
Loan Parties;

     (iii) the Capital Securities in an aggregate amount not in excess of $200,000,000 at
any time outstanding and the Pollution Control Bonds in an aggregate amount not in excess of
$10,000,000 at any time outstanding;

     (iv) Indebtedness existing on the date hereof and set forth in Schedule 6.01 and
extensions, renewals and replacements of any such

 

54

Indebtedness
that do not increase the outstanding principal amount thereof or result in an earlier maturity date or decreased
weighted average life thereof;

     (v) Indebtedness of the Borrower to any Subsidiary and of any Subsidiary to the
Borrower or any other Subsidiary; provided that Indebtedness of any Subsidiary that
is not a Loan Party to the Borrower or any Subsidiary Loan Party shall be subject to Section
6.04;

     (vi) Guarantees by the Borrower of Indebtedness of any Subsidiary and by any Subsidiary
of Indebtedness of any other Subsidiary; provided that Guarantees by the Borrower or
any Subsidiary Loan Party of Indebtedness of any Subsidiary that is not a Loan Party shall
be subject to Section 6.04;

     (vii) Indebtedness of the Borrower or any Restricted Subsidiary incurred to finance the
acquisition, construction or improvement of any fixed or capital assets, including Capital
Lease Obligations and any Indebtedness assumed in connection with the acquisition of any
such assets or secured by a Lien on any such assets prior to the acquisition thereof, and
extensions, renewals and replacements of any such Indebtedness that do not increase the
outstanding principal amount thereof or result in an earlier maturity date or decreased
weighted average life thereof; provided that such Indebtedness is incurred prior to
or within 90 days after such acquisition or the completion of such construction or
improvement;

     (viii) Indebtedness and Attributable Debt in respect of Sale-Leaseback Transactions not
in excess of $75,000,000 in the aggregate at any time outstanding;

     (ix) (i) Indebtedness and Funded Receivables Sales of Restricted Subsidiaries that are
Securitization Vehicles (including Indebtedness in respect of Third Party Securities) in an
aggregate amount not in excess of $250,000,000 at any time outstanding and (ii) Indebtedness
of the Borrower and Restricted Subsidiaries consisting solely of Liens on their Sellers’
Retained Interests in connection with Securitizations permitted by Section 6.04 securing
obligations in respect of Third Party Securities in an aggregate amount not in excess of
$250,000,000 at any time outstanding minus the then outstanding amount of Indebtedness and
Funded Receivables Sales incurred in reliance on clause (i) of this paragraph;

     (x) Indebtedness of LOL Finance and its Wholly Owned Subsidiaries incurred in the
ordinary course of business to finance their assets; provided that such Indebtedness
(x) is not Guaranteed by the Borrower or any other Restricted Subsidiary, except to the
extent permitted pursuant to clause (vii) above and (y) does not exceed $150,000,000 at any
time outstanding; and

     (xi) Permitted Additional Debt; provided that immediately prior to, and after
giving effect to, the incurrence of such Permitted Additional Debt, the Borrower is in Pro
Forma Compliance.

          (b) The Borrower will not permit any Restricted Subsidiary to issue any preferred stock or
other preferred Equity Interests.

 

55

          SECTION 6.02. Liens. The Borrower will not, and will not permit any Restricted
Subsidiary to, create, incur, assume or permit to exist any Lien on any property or asset now owned
or hereafter acquired by it, or assign or sell any income or revenues (including accounts
receivable) or rights in respect of any thereof, except:

     (i) Liens created under the Loan Documents;

     (ii) Permitted Encumbrances;

     (iii) any Lien on any property or asset of the Borrower or any Restricted Subsidiary
existing on the date hereof and set forth in Schedule 6.02; provided that (i) such
Lien shall not apply to any other property or asset of the Borrower or any Restricted
Subsidiary and (ii) such Lien shall secure only those obligations which it secures on the
date hereof and extensions, renewals and replacements thereof that do not increase the
outstanding principal amount thereof;

     (iv) any Lien existing on any property or asset prior to the acquisition thereof by the
Borrower or any Restricted Subsidiary or existing on any property or asset of any Person
that becomes a Restricted Subsidiary after the date hereof prior to the time such Person
becomes a Restricted Subsidiary; provided that (A) such Lien is not created in
contemplation of or in connection with such acquisition or such Person becoming a Restricted
Subsidiary, as the case may be, (B) such Lien shall not apply to any other property or
assets of the Borrower or any Restricted Subsidiary and (C) such Lien shall secure only
those obligations which it secures on the date of such acquisition or the date such Person
becomes a Restricted Subsidiary, as the case may be and extensions, renewals and
replacements thereof that do not increase the outstanding principal amount thereof;

     (v) Liens on fixed or capital assets acquired, constructed or improved by the Borrower
or any Restricted Subsidiary; provided that (A) such security interests secure
Indebtedness permitted by clause (vii) of Section 6.01(a), (B) such security interests and
the Indebtedness secured thereby are incurred prior to or within 90 days after such
acquisition or the completion of such construction or improvement, (C) the Indebtedness
secured thereby does not exceed 100% of the cost of acquiring, constructing or improving
such fixed or capital assets and (D) such security interests shall not apply to any other
property or assets of the Borrower or any Restricted Subsidiary;

     (vi) Liens of CoBank on investments by the Borrower in the stock, participation
certificates, or allocated reserves of CoBank owned by the Borrower;

     (vii) Liens not expressly permitted by clauses (i) through (vi) above; provided
that the sum, without duplication, of (x) the aggregate principal amount of Indebtedness
secured by Liens permitted by this clause (vii) and (y) the Attributable Debt permitted by
Section 6.06, does not at any time exceed $75,000,000;

     (viii) Liens on Sellers’ Retained Interests incurred in connection with Securitizations
permitted by Section 6.01(a) and 6.04 securing obligations in respect of Third Party
Securities permitted by Section 6.01(a)(ix)(ii); provided, however, that

 

56

recourse to such Sellers’ Retained Interests is limited in a manner consistent with
Standard Securitization Undertakings and the ratio of the amount of such Sellers’ Retained
Interests to the amount of such Third Party Securities is not significantly greater than the
ratio of sellers’ retained interests to the financed portion of assets in similar
securitization transactions;

     (ix) Liens on assets of Restricted Subsidiaries that are Securitization Vehicles
securing Indebtedness of such Securitization Vehicles permitted by Section 6.01(a)(ix)(i);

     (x) Liens on loan assets of LOL Finance and its Wholly Owned Subsidiaries incurred in
the ordinary course of business and securing Indebtedness incurred pursuant to Section
6.01(a)(x); and

     (xi) Liens created under the Second Lien Security Documents to secure the Senior Second
Lien Note Obligations; provided that (A) such Liens do not apply to any asset other
than Collateral that is subject to a prior Lien granted under a Security Document and (B)
all such Liens shall be subordinate and junior to the Liens securing the Obligations on the
terms set forth in the Intercreditor Agreement.

          SECTION 6.03. Fundamental Changes. (a) The Borrower will not, nor will it permit any
Restricted Subsidiary to, merge into or consolidate with any other Person, or permit any other
Person to merge into or consolidate with it, or liquidate or dissolve, except that, if at the time
thereof and immediately after giving effect thereto no Default shall have occurred and be
continuing (i) any Person may merge into the Borrower in a transaction in which the Borrower is the
surviving corporation, (ii) any Person may merge with or into any Restricted Subsidiary in a
transaction in which the surviving entity is or becomes a Wholly Owned Restricted Subsidiary and a
Subsidiary Loan Party; provided that any such merger involving a Person that is not a
Wholly Owned Restricted Subsidiary immediately prior to such merger shall not be permitted unless
also permitted by Section 6.04 and (iii) any Restricted Subsidiary may liquidate or dissolve if the
Borrower determines in good faith that such liquidation or dissolution is in the best interests of
the Borrower and is not materially disadvantageous to the Lenders.

          (b) The Borrower will not, and will not permit any of its Restricted Subsidiaries to, engage
to any material extent in any business other than businesses of the type conducted by the Borrower
and its Restricted Subsidiaries on the date of execution of this Agreement and businesses
reasonably related thereto. The Borrower will not permit LOL Finance or any subsidiary of LOL
Finance to engage in any business other than the making of loans to third parties to finance their
operations, their purchases of goods or services or the construction of facilities and activities
directly related to the funding and sale of such loans. The Borrower will not permit any
Securitization Vehicle to engage in any business other than the acquisition, financing and/or sale
of accounts receivable in connection with any Securitization permitted hereby.

          SECTION 6.04. Investments, Loans, Advances, Guarantees and Acquisitions. The Borrower
will not, and will not permit any of its Restricted Subsidiaries to, purchase, hold or acquire
(including pursuant to any merger with any Person that was not a Wholly Owned

 

57

Restricted
Subsidiary prior to such merger) any Equity Interests in or evidences
of indebtedness or other securities (including any option, warrant or other right to acquire any of the
foregoing) of, make or permit to exist any loans or advances to, Guarantee any obligations of, or
make or permit to exist any investment or any other interest in, any other Person, or purchase or
otherwise acquire (in one transaction or a series of transactions) any assets of any other Person
constituting a business unit, except:

          (a) Permitted Investments;

          (b) investments existing on the date hereof and set forth on Schedule 6.04;

          (c) investments by the Borrower and the Restricted Subsidiaries in Equity Interests in
Subsidiary Loan Parties; provided that any such Equity Interests held by a Loan Party shall
be pledged pursuant to the Collateral Agreement;

          (d) loans or advances made by the Borrower to any Subsidiary and made by any Restricted
Subsidiary to the Borrower or any other Subsidiary; provided that (i) any such loans and
advances made by a Loan Party shall be pledged pursuant to the Collateral Agreement and (ii) the
amount of such loans and advances made after the date hereof by Loan Parties to Subsidiaries that
are not Loan Parties, including to LOL Finance and its subsidiaries, shall be subject to the
limitation set forth in clause (l) below;

          (e) Guarantees constituting Indebtedness permitted by Section 6.01 and Guarantees of other
obligations not constituting Indebtedness; provided that the aggregate principal amount of
Indebtedness and the amount of obligations not constituting Indebtedness of Subsidiaries that are
not Loan Parties (including LOL Finance and its subsidiaries) that is Guaranteed after the date
hereof by Loan Parties shall be subject to the limitation set forth in clause (l) below;

          (f) investments in Equity Interests of CoBank required to be made in accordance with CoBank’s
bylaws and capital plans applicable to cooperative borrowers generally;

          (g) investments consisting of non-cash consideration received in connection with sales of
assets permitted by Section 6.05;

          (h) investments consisting of Sellers’ Retained Interests in Securitizations permitted by
Section 6.05; provided, that the amount of any such investments made after the Effective
Date, other than in connection with the ordinary course sale of accounts receivable to the
applicable Securitization Vehicle in accordance with the terms of the applicable documentation
governing such Securitization, shall not exceed $5,000,000 in the aggregate;

          (i) investments received in connection with the bankruptcy or reorganization of, or settlement
of delinquent accounts and disputes with, customers and suppliers, in each case in the ordinary
course of business;

          (j) Permitted Acquisitions;

          (k) investments by LOL Finance and its Wholly Owned Subsidiaries consisting of loans made or
acquired by them in the ordinary course

 

58

of
business not in excess of $150,000,000 in the aggregate at any time outstanding (excluding the amount of any such loans
sold (including by way of participation sales) in a non-recourse sale transaction as permitted by
Section 6.05(h)); and

          (l) other investments by the Borrower and the Restricted Subsidiaries not otherwise permitted
hereby, provided that the aggregate amount of all such investments, together with the
aggregate amount of loans and advances to, and Guarantees of Indebtedness or other obligations not
constituting Indebtedness of, Subsidiaries that are not Loan Parties (including LOL Finance and its
subsidiaries), made by Loan Parties pursuant to clauses (d) and (e) above, shall not exceed
$50,000,000 at any time outstanding, and provided, further, that the Borrower and
the Restricted Subsidiaries shall not make investments in Securitization Vehicles pursuant to this
paragraph (l).

          SECTION 6.05. Asset Sales. The Borrower will not, and will not permit any of the
Restricted Subsidiaries to, sell, transfer, lease or otherwise dispose of any asset, including any
Equity Interest owned by it, nor will the Borrower permit any of the Restricted Subsidiaries to
issue any additional Equity Interest in such Restricted Subsidiary, except:

          (a) sales of inventory, used or surplus equipment and Permitted Investments in the ordinary
course of business;

          (b) sales, transfers and dispositions to the Borrower or a Subsidiary; provided that
(i) any such sales, transfers or dispositions involving a Subsidiary that is not a Loan Party shall
be made in compliance with Section 6.09 and (ii) the cumulative aggregate fair market value of
sales, transfers and dispositions after the Effective Date to Subsidiaries that are not Loan
Parties (other than for cash consideration) shall not exceed $50,000,000;

          (c) sales, transfers or other dispositions described in Schedule 6.05(c);

          (d) sales, transfers and other dispositions of assets (other than sales, transfers or
dispositions of less than 100% of the Equity Interests in a Restricted Subsidiary owned by the
Borrower and the Restricted Subsidiaries) that are not permitted by any other clause of this
Section; provided that (i) the aggregate fair market value of all assets sold, transferred or
otherwise disposed of in reliance upon this clause (d) shall not exceed $75,000,000 during any
fiscal year of the Borrower and (ii) for purposes of clause (i), the fair market value of Equity
Interests in a Restricted Subsidiary shall in any event be deemed to be at least equal to the sum
of the purchase price and all Indebtedness of such Restricted Subsidiary transferred as part of, or
other Indebtedness assumed by the transferee or its Affiliates in connection with, such sale,
transfer or disposition;

          (e) the sale to one or more Securitization Vehicles of accounts receivable (including Account
Assets) in Securitizations and the sale by Securitization Vehicles of accounts receivable
(including Account Assets) or interests therein to third parties in Securitizations,
provided that (i) each such Securitization is effected on market terms and (ii) the
aggregate amount (without duplication) of Indebtedness, Third Party Securities and Funded
Receivables Sales in respect of all such Securitizations does not exceed $250,000,000 at any time
outstanding;

 

59

          (f) issuances of Equity Interests of Restricted Subsidiaries that are pledged under the
Security Documents;

          (g) cash lease payments in respect of leases of surplus warehouse and office space entered
into in the ordinary course of business on arms-length terms;

          (h) the sale by LOL Finance and its Wholly Owned Subsidiary, LOLFC, LLC, in the ordinary
course of its business of (i) loans made in the ordinary course of business and (ii) participations
in loans made in the ordinary course of business, provided that the amount of such
participations shall not exceed $125,000,000 in the aggregate at any time outstanding; and

          (i) sales, transfers or other dispositions of any Equity Interest in MoArk;

          provided that all sales, transfers, leases and other dispositions permitted hereby (other
than those among Loan Parties permitted by clause (b) above) shall be made for fair value and for
at least 80% cash consideration, provided further that non-cash consideration in
excess of 20% of the consideration for any such sales, transfers, leases and other dispositions may
be received in an aggregate cumulative amount not in excess of $50,000,000 in fair value.

          SECTION 6.06. Sale and Leaseback Transactions. The Borrower will not, and will not
permit any Restricted Subsidiary to, enter into any Sale-Leaseback Transaction except:

          (a) Sale-Leaseback Transactions to which the Borrower or any Restricted Subsidiary is a party
as of the date hereof; and

          (b) other Sale-Leaseback Transactions; provided that the sum, without duplication, of
(i) the aggregate principal amount of Indebtedness secured by Liens permitted by Section 6.02(vii)
and (ii) the aggregate Attributable Debt in respect of Sale-Leaseback Transactions permitted by
this clause (b), does not at any time exceed $75,000,000.

          SECTION 6.07. Hedging Agreements. The Borrower will not, and will not permit any of
its Restricted Subsidiaries to, enter into any Hedging Agreement, other than (a) Hedging Agreements
entered into in the ordinary course of business to hedge or mitigate risks to which the Borrower or
any Restricted Subsidiary is exposed in the conduct of its business or the management of its
liabilities and (b) Hedging Agreements entered into in order to effectively cap, collar or exchange
interest rates (from fixed to floating rates, from one floating rate to another floating rate or
otherwise) with respect to any interest-bearing liability or investment of the Borrower or any
Restricted Subsidiary.

          SECTION 6.08. Restricted Payments; Certain Payments of Indebtedness. (a) The
Borrower will not, nor will it permit any Restricted Subsidiary to, declare or make, or agree to
pay or make, directly or indirectly, any Restricted Payment, or incur any obligation (contingent or
otherwise) to do so, except:

     (i) Restricted Subsidiaries may declare and pay dividends ratably with respect to their
Equity Interests;

 

60

     (ii) provided that no Default has occurred and is continuing or would result therefrom,
the Borrower may make Restricted Payments (including cash payments of patronage dividends
and of revolvements and redemptions of Equity Interests) on any Payment Date in an amount
not in excess of the sum of (w) $60,500,000, plus (x) 50% of the Borrower’s
cumulative Consolidated Net Income during each Non-Investment Grade RP Period plus
(y) 100% of the Borrower’s cumulative Consolidated Net Income during each Investment Grade
RP Period minus (z) the aggregate amount of Restricted Expenditures during the
relevant Calculation Period (after giving effect to any other Restricted Expenditures to be
made on such Payment Date);

     (iii) if a Default has occurred and is continuing or would result therefrom, the
Borrower may make payments of patronage dividends and of revolvements and redemptions at
such times and in such minimum amounts as may be necessary to permit each allocation of the
Borrower’s patronage earnings to a member to be deemed a “qualified written notice of
allocation” as defined in Section 1388(c)(1) of the Internal Revenue Code; and

     (iv) the Borrower may pay dividends not exceeding $100,000 per annum with respect to
its preferred stock issued and outstanding as of the Effective Date in accordance with the
terms thereof on the Effective Date.

          (b) The Borrower will not, and will not permit any Restricted Subsidiary to, make or agree to
pay or make, directly or indirectly, any payment or other distribution (whether in cash, securities
or other property) of or in respect of principal of or interest on any Indebtedness, any
indebtedness owed to the trust entity that has issued the Capital Securities, or any payment or
other distribution (whether in cash, securities or other property), including any sinking fund or
similar deposit, on account of the purchase, redemption, retirement, acquisition, cancellation or
termination of any Indebtedness, except:

     (i) payment of Indebtedness created under the Loan Documents;

     (ii) payment of regularly scheduled interest and principal payments as and when due in
respect of any Indebtedness, other than payments in respect of the Capital Securities
prohibited by the subordination provisions thereof;

     (iii) mandatory payments by a Securitization Vehicle on Third Party Securities;

     (iv) in addition to any purchases pursuant to clause (vii), the Borrower may make
repurchases of Senior Notes and Senior Second Lien Notes on any Payment Date after the
Effective Date in an amount not in excess of the sum of (w) $60,500,000 plus (x) 50%
of the Borrower’s cumulative Consolidated Net Income during each Non-Investment Grade RP
Period, plus (y) 100% of the Borrower’s cumulative Consolidated Net Income during
each Investment Grade RP Period, minus (z) the aggregate amount of Restricted
Expenditures during the relevant Calculation Period (after giving effect to any other
Restricted Expenditures to be made on such Payment Date); provided that (A)
immediately after giving effect to any such repurchase (and the Repurchase Expenditures made
or to be made in connection

 

61

therewith)
the aggregate amount of the unused Commitments is not less than $100,000,000, (B) no Default exists at the time of and
after giving effect to any such repurchase, (C) the aggregate amount of Repurchase
Expenditures effected pursuant to this clause (iv) shall not exceed the aggregate amount of
increases in the Commitments effected pursuant to Section 2.18, and (D) at the time of any
such repurchase, the Senior Secured Debt to EBITDA Ratio is not greater than 1.50 to 1.00
(or, if the Collateral has been released from the Liens of the Security Documents pursuant
to Section 9.14, the Senior Debt to EBITDA Ratio is not greater than 2.00 to 1.00);

     (v) refinancings of Indebtedness to the extent permitted by Section 6.01;

     (vi) payment of secured Indebtedness that becomes due as a result of the voluntary sale
or transfer of the property or assets securing such Indebtedness; and

     (vii) in addition to any purchases pursuant to clause (iv), the Borrower may, after the
Effective Date, repurchase any combination of the Senior Notes, the Senior Second Lien Notes
and/or the Capital Securities for cumulative Repurchase Expenditures in an amount not
greater than $150,000,000; provided that (A) immediately after giving effect to any
such repurchase (and the Repurchase Expenditures made or to be made in connection therewith)
the aggregate amount of the unused Commitments is not less than $100,000,000, and (B) no
Default exists at the time of and after giving effect to any such repurchase.

          SECTION 6.09. Transactions with Affiliates. The Borrower will not, and will not
permit any Restricted Subsidiary to, sell, lease or otherwise transfer any property or assets to,
or purchase, lease or otherwise acquire any property or assets from, or otherwise engage in any
other transactions with, any of its Affiliates, except (a) transactions in the ordinary course of
business that are at prices and on terms and conditions not less favorable to the Borrower or such
Restricted Subsidiary than could be obtained on an arm’s-length basis from unrelated third parties,
(b) transactions between or among the Borrower and the Subsidiary Loan Parties not involving any
other Affiliate, (c) any Restricted Payment permitted by Section 6.08 and (d) Securitizations
permitted by Sections 6.01 and 6.02.

          SECTION 6.10. Restrictive Agreements. The Borrower will not, and will not permit any
Restricted Subsidiary to, directly or indirectly, enter into, incur or permit to exist any
agreement or other arrangement that prohibits, restricts or imposes any condition upon (a) the
ability of the Borrower or any Restricted Subsidiary to create, incur or permit to exist any Lien
upon any of its property or assets, or (b) the ability of any Restricted Subsidiary to pay
dividends or other distributions with respect to any shares of its capital stock or to make or
repay loans or advances to the Borrower or any other Restricted Subsidiary or to Guarantee
Indebtedness of the Borrower or any other Restricted Subsidiary; provided that (i) the
foregoing shall not apply to restrictions and conditions imposed by law, by any Loan Document, by
the Senior Note Documents or by the Senior Second Lien Note Documents, (ii) the foregoing shall not
apply to restrictions and conditions existing on the date hereof identified on Schedule 6.10 (but
shall apply to any amendment or modification expanding the scope of, any such restriction or
condition), (iii) the foregoing shall not apply to customary restrictions and conditions contained
in agreements relating to the sale of a

 

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Restricted Subsidiary or, in the case of clause (a), assets
of the Borrower or a Restricted Subsidiary, pending such sale, provided such restrictions and
conditions apply only to the Restricted Subsidiary or assets that are to be sold and such sale is
permitted hereunder, (iv) clause (a) of the foregoing shall not apply to restrictions or conditions
imposed by any agreement relating to secured Indebtedness permitted by this Agreement if such
restrictions or conditions apply only to the property or assets securing such Indebtedness, (v)
clause (a) of the foregoing shall not apply to customary provisions in leases or other agreements
restricting the assignment thereof, (vi) the foregoing shall not apply to agreements governing
permitted Indebtedness and loan participation agreements permitted by Section 6.05(h) of LOL
Finance or its Wholly Owned Subsidiaries so long as any restrictions therein apply only to LOL
Finance and/or its subsidiaries and (vii) the foregoing shall not apply to customary restrictions
and conditions contained in agreements relating to Securitizations that are permitted hereunder,
provided that such restrictions and conditions relate only to Securitization Vehicles or to the
receivables which are the subject of a Securitization.

          SECTION 6.11. Amendment of Material Documents. The Borrower will not, and will not
permit any Restricted Subsidiary to, amend, modify or waive any of its rights under (a) any
agreement governing Material Indebtedness or (b) its certificate of incorporation, by-laws or other
organizational documents that, in any case referred to in clause (a) or (b), could reasonably be
expected to be adverse in any significant respect to the interests of the Lenders.

          SECTION 6.12. Interest Expense Coverage Ratio. The Borrower will not permit the ratio
of (a) Consolidated EBITDA to (b) Consolidated Cash Interest Expense, for any period of four
consecutive fiscal quarters, to be less than 2.50 to 1.00.

          SECTION 6.13. Leverage Ratio. The Borrower will not permit the Leverage Ratio on any
date to exceed 3.75 to 1.00.

ARTICLE VII

Events of Default

          If any of the following events (each, an “Event of Default”) shall occur:

          (a) the Borrower shall fail to pay any principal of any Loan or any reimbursement obligation
in respect of any LC 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 otherwise;

          (b) the Borrower shall fail to pay any interest on any Loan or any fee or any other amount
(other than an amount referred to in clause (a) of this Article) payable under this Agreement or
any other Loan Document, when and as the same shall become due and payable, and such failure shall
continue unremedied for a period of five days;

          (c) any representation or warranty made or deemed made by or on behalf of the Borrower or any
Restricted Subsidiary in or in connection with any Loan Document or any amendment or modification
thereof or waiver thereunder, or in any report, certificate, financial statement or other document
furnished pursuant to or in connection with any Loan Document or any amendment or modification
thereof or waiver thereunder, shall prove to have been incorrect in any material respect when made
or deemed made;

 

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          (d) the
Borrower shall fail to observe or perform any covenant, condition or
agreement contained in Section 5.02, 5.04 (with respect to the
existence of the Borrower), 5.11 or 5.13(c) or in Article VI;

          (e) any Loan Party shall fail to observe or perform any covenant, condition or agreement
contained in any Loan Document (other than those specified in clause (a), (b) or (d) of this
Article), and such failure shall continue unremedied for a period of 30 days after notice thereof
from the Co-Administrative Agent to the Borrower (which notice will be given at the request of any
Lender);

          (f) the Borrower or any Restricted Subsidiary shall fail to make any payment (whether of
principal or interest and regardless of amount) in respect of any Material Indebtedness, when and
as the same shall become due and payable;

          (g) any event or condition occurs that results in any Material Indebtedness becoming due prior
to its scheduled maturity or that enables or permits the holder or holders of any Material
Indebtedness or any trustee or agent on its or their behalf to cause any Material Indebtedness to
become due, or to require the prepayment, repurchase, redemption or defeasance thereof, prior to
its scheduled maturity; provided that this clause (g) shall not apply to secured
Indebtedness that becomes due as a result of the voluntary sale or transfer of the property or
assets securing such Indebtedness;

          (h) an involuntary proceeding shall be commenced or an involuntary petition shall be filed
seeking (i) liquidation, reorganization or other relief in respect of the Borrower or any
Restricted Subsidiary or its debts, or of a substantial part of its assets, under any Federal,
state or foreign bankruptcy, insolvency, receivership or similar law now or hereafter in effect or
(ii) the appointment of a receiver, trustee, custodian, sequestrator, conservator or similar
official for the Borrower or any Restricted Subsidiary or for a substantial part of its assets,
and, in any such case, 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;

          (i) the Borrower or any Restricted Subsidiary shall (i) voluntarily commence any proceeding or
file any petition seeking liquidation, reorganization or other relief under any Federal, state or
foreign bankruptcy, insolvency, receivership or similar law now or hereafter in effect, (ii)
consent to the institution of, or fail to contest in a timely and appropriate manner, any
proceeding or petition described in clause (h) of this Article, (iii) apply for or consent to the
appointment of a receiver, trustee, custodian, sequestrator, conservator or similar official for
the Borrower or any Restricted Subsidiary or for a substantial part of its assets, (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 or (vi) adopt any resolutions for the
purpose of effecting any of the foregoing;

          (j) the Borrower or any Restricted Subsidiary shall become unable, admit in writing its
inability or fail generally to pay its debts as they become due;

          (k) one or more judgments for the payment of money in an aggregate amount in excess of
$10,000,000 shall be rendered against the

 

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Borrower,
any Restricted 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 attach or levy upon any assets of the Borrower or any Restricted Subsidiary to
enforce any such judgment;

          (l) an ERISA Event shall have occurred that, in the opinion of the Required Lenders, when
taken together with all other ERISA Events that have occurred, could reasonably be expected to
result in a Material Adverse Effect;

          (m) any Guarantee or Lien purported to be created under any Security Document shall cease to
be, or shall be asserted by any Loan Party not to be, a valid Guarantee or a perfected Lien on any
material Collateral, with the priority required by the applicable Security Document, except (i)
pursuant to Section 9.14, (ii) as a result of the sale or other disposition of the applicable
Collateral or the release of the applicable Loan Party in a transaction permitted under the Loan
Documents or (iii) as a result of the Collateral Agent’s failure to file any necessary continuation
statements or to maintain possession of any stock certificates, promissory notes or other
instruments delivered to it under the Collateral Agreement; or

(n) a Change in Control shall occur;

then, and in every such event (other than an event with respect to the Borrower described in clause
(h) or (i) of this Article), and at any time thereafter during the continuance of such event, the
Co-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 the Commitments, and thereupon the Commitments shall terminate immediately, and (ii)
declare the Loans then outstanding to be due and payable in whole (or in part, in which case any
principal not so declared to be due and payable may thereafter be declared to be due and payable),
and thereupon the principal of the Loans so declared to be due and payable, together with accrued
interest thereon and all fees and other obligations of the Borrower accrued hereunder, shall become
due and payable immediately, without presentment, demand, protest or other notice of any kind, all
of which are hereby waived by the Borrower; and in case of any event with respect to the Borrower
described in clause (h) or (i) of this Article, the Commitments shall automatically terminate and
the principal of the Loans then outstanding, together with accrued interest thereon and all fees
and other obligations of the Borrower accrued hereunder, shall automatically become due and
payable, without presentment, demand, protest or other notice of any kind, all of which are hereby
waived by the Borrower.

ARTICLE VIII

The Agents

          Each of the Lenders and each Issuing Bank hereby irrevocably appoints each Agent as its agent
and authorizes each Agent to take such actions on its behalf and to exercise such powers as are
delegated to such Agent by the terms of the Loan Documents, together with such actions and powers
as are reasonably incidental thereto.

 

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          Each bank serving as an Agent hereunder shall have the same rights and powers in its capacity
as a Lender as any other Lender and may exercise the same as though it were not an Agent, and such
bank and its 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
hereunder.

          The Agents shall not have any duties or obligations except those expressly set forth in the
Loan Documents. Without limiting the generality of the foregoing, (a) the Agents shall not be
subject to any fiduciary or other implied duties, regardless of whether a Default has occurred and
is continuing, (b) the Agents shall not have any duty to take any discretionary action or exercise
any discretionary powers, except discretionary rights and powers expressly contemplated by the Loan
Documents that the Agents are required to exercise in writing by the Required Lenders (or such
other number or percentage of the Lenders as shall be necessary under the circumstances as provided
in Section 9.02), and (c) except as expressly set forth in the Loan Documents, the Agents shall not
have any duty to disclose, and shall not be liable for the failure to disclose, any information
relating to the Borrower or any of its Subsidiaries that is communicated to or obtained by any bank
serving as an Agent or any of its Affiliates in any capacity. Neither Agent shall be liable for
any action taken or not taken by it with the consent or at the request of the Required Lenders (or
such other number or percentage of the Lenders as shall be necessary under the circumstances as
provided in Section 9.02) or in the absence of its own gross negligence or willful misconduct.
Neither Agent shall be deemed to have knowledge of any Default unless and until written notice
thereof is given to such Agent by the Borrower or a Lender, and neither Agent shall be responsible
for or have any duty to ascertain or inquire into (i) any statement, warranty or representation
made in or in connection with any Loan Document, (ii) the contents of any certificate, report or
other document delivered thereunder or in connection therewith, (iii) the performance or observance
of any of the covenants, agreements or other terms or conditions set forth in any Loan Document,
(iv) the validity, enforceability, effectiveness or genuineness of any Loan Document or any other
agreement, instrument or document, or (v) the satisfaction of any condition set forth in Article IV
or elsewhere in any Loan Document, other than to confirm receipt of items expressly required to be
delivered to such Agent.

          Each Agent shall be entitled to rely upon, and shall not incur any liability for relying upon,
any notice, request, certificate, consent, statement, instrument, document or other writing
believed by it to be genuine and to have been signed or sent by the proper Person. Each Agent also
may rely upon any statement made to it orally or by telephone and believed by it to be made by the
proper Person, and shall not incur any liability for relying thereon. Each Agent may consult with
legal counsel (who may be counsel for the Borrower), independent accountants and other experts
selected by it, and shall not be liable for any action taken or not taken by it in accordance with
the advice of any such counsel, accountants or experts.

          An Agent may perform any and all its duties and exercise its rights and powers by or through
any one or more sub-agents appointed by such Agent. An Agent and any such sub-agent may perform
any and all its duties and exercise its rights and powers through their respective Related Parties.
The exculpatory provisions of the preceding paragraphs shall apply to any such sub-agent and to
the Related Parties of such

 

66

Agent and
any such sub-agent, and shall apply to their respective activities in connection with the syndication of the credit
facilities provided for herein as well as activities as an Agent.

          Subject to the appointment and acceptance of a successor Agent as provided in this paragraph,
an Agent may resign at any time by notifying the Lenders, each Issuing Bank and the Borrower. Upon
any such resignation, the Required Lenders shall have the right, in consultation with the Borrower,
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 and Issuing Banks, appoint a
successor Agent which shall be a bank with an office in New York, New York, or an Affiliate of any
such bank. Upon the acceptance of its appointment as an Agent hereunder by a successor, 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. The fees payable by the Borrower to a successor Agent shall be the same as those
payable to its predecessor unless otherwise agreed between the Borrower and such successor. After
an Agent’s resignation hereunder, the provisions of this Article and Section 9.03 shall continue in
effect for the benefit of such retiring Agent, its sub-agents and their respective Related Parties
in respect of any actions taken or omitted to be taken by any of them while it was acting as an
Agent.

          Each Lender acknowledges that it has, independently and without reliance upon either Agent 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 either Agent 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, any other Loan
Document or related agreement or any document furnished hereunder or thereunder.

ARTICLE IX

Miscellaneous

          SECTION 9.01. Notices. Except in the case of notices and other communications
expressly permitted to be given by telephone, all 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 Land O’ Lakes, Inc., 4001 Lexington Avenue North, Saint Paul,
MN 55126, Attention of Treasurer (Telecopy No. 651-481-2086);

          (b) if to the Co-Administrative Agent, including in its capacity as an Issuing Bank, to
Co-Bank, ACB at 5500 South Quebec Street, Greenwood Village, CO 80111, Attention of:
Co-Administrative Agent, Telecopy No. (303) 694-5830;

          (c) if to the Administrative Agent, including in its capacity as an Issuing Bank, to JPMorgan
Chase Bank, N.A., Loan and Agency

 

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Services
Group, 1111 Fannin Street, 10th Floor, Houston, Texas 77002, Attention of Claudia Garcia (Telecopy No. (713) 750-2223), with a copy
to JPMorgan Chase Bank, N.A., 270 Park Avenue, New York, New York 10017, Attention of Barbara Marks
(Telecopy No. 212-270-3279);

          (d) if to any other Lender, to it at its address (or telecopy number) set forth in its
Administrative Questionnaire.

          Any party hereto may change its address or telecopy number for notices and other communications
hereunder by notice to the other parties 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.

          SECTION 9.02. Waivers; Amendments. (a) No failure or delay by either Agent, any
Issuing Bank or any Lender in exercising any right or power 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 Agents, each 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 any Loan Document or consent to any departure by any
Loan Party therefrom shall in any event be effective unless the same shall be permitted by
paragraph (b) of this Section, and then such waiver or consent shall be effective only in the
specific instance and for the purpose for which given. Without limiting the generality of the
foregoing, the making of a Loan or the issuance of a Letter of Credit shall not be construed as a
waiver of any Default, regardless of whether either Agent, any Lender or any Issuing Bank may have
had notice or knowledge of such Default at the time.

          (b) Neither this Agreement nor any other Loan Document nor any provision hereof or thereof may
be waived, amended or modified except, in the case of this Agreement, pursuant to an agreement or
agreements in writing entered into by the Borrower and the Required Lenders or, in the case of any
other Loan Document, pursuant to an agreement or agreements in writing entered into by the Agents
and the Loan Party or Loan Parties that are parties thereto, in each case with the consent of the
Required Lenders; provided that no such agreement shall (i) increase the Commitment of any
Lender without the written consent of such Lender, (ii) reduce the principal amount of any Loan or
LC Disbursement or reduce the rate of interest thereon, or reduce any fees payable hereunder,
without the written consent of each Lender, (iii) postpone the maturity of any Loan or the required
date of reimbursement of any LC Disbursement, or any date for the payment of any interest or fees
payable hereunder, or reduce the amount of, waive or excuse any such payment, or postpone the
scheduled date of expiration of any Commitment, without the written consent of each Lender, (iv)
change Section 2.16(b) or (c) in a manner that would alter the pro rata sharing of payments
required thereby, without the written consent of each Lender, (v) change any of the provisions of
this Section or the percentage set forth in the definition of “Required Lenders” or any other
provision of any Loan Document specifying the number or percentage of Lenders required to waive,
amend or modify any rights thereunder or make any determination or grant any consent thereunder,
without the written consent of each Lender, (vi) release any Subsidiary Loan Party from its
Guarantee under the Collateral Agreement (except as expressly

 

68

provided in the Collateral
Agreement), or limit its liability in respect of such Guarantee, without the written consent of each Lender, (vii)
release all or substantially all of the Collateral from the Liens of the Security Documents (other
than pursuant to Section 9.14), in each case, without the written consent of each Lender;
provided further that no such agreement shall amend, modify or otherwise affect the rights
or duties of an Agent or any Issuing Bank without the prior written consent of such Agent or such
Issuing Bank, as the case may be. Notwithstanding the foregoing, any provision of this Agreement
may be amended by an agreement in writing entered into by the Borrower, the Required Lenders and
the Agents (and, if its rights or obligations are affected thereby, each Issuing Bank) if (i) by
the terms of such agreement the Commitment of each Lender not consenting to the amendment provided
for therein shall terminate upon the effectiveness of such amendment, (ii) at the time such
amendment becomes effective, each Lender not consenting thereto receives payment in full of the
principal of and interest accrued on each Loan made by it and all other amounts owing to it or
accrued for its account under this Agreement , and (iii) after giving effect to such amendment and
all contemporaneous repayments of Loans and reductions of Commitments, the sum of the total
Revolving Exposures shall not exceed the total Commitments. Notwithstanding any other provision of
any Loan Document, no consent shall be required to be obtained in connection with any waiver,
amendment or other modification of any Loan Document from any Lender that has no Commitment and
whose Revolving Exposure is zero.

          SECTION 9.03. Expenses; Indemnity; Damage Waiver. (a) The Borrower shall pay (i) all
reasonable out-of-pocket expenses incurred by each Agent and its Affiliates, including any such
expenses incurred in connection with due-diligence and the reasonable fees, charges and
disbursements of counsel for such Agent, in connection with the arrangement and syndication of the
credit facilities provided for herein and the preparation, execution, delivery and administration
of the Loan Documents or any amendments, modifications or waivers of the provisions thereof
(whether or not the transactions contemplated hereby or thereby shall be consummated), (ii) all
reasonable out-of-pocket expenses incurred by each Issuing Bank in connection with the issuance,
amendment, renewal or extension of any Letter of Credit or any demand for payment thereunder and
(iii) all reasonable out-of-pocket expenses incurred by each Agent, each Issuing Bank or any
Lender, including the reasonable fees, charges and disbursements of any counsel for each Agent, any
Issuing Bank or any Lender, in connection with the enforcement or protection of its rights in
connection with the Loan Documents, including its rights under this Section, or in connection with
the Loans made or Letters of Credit issued hereunder, including all such out-of-pocket expenses
incurred during any workout, restructuring or negotiations in respect of such Loans or Letters of
Credit.

          (b) The Borrower shall indemnify each Agent, each Issuing Bank and each Lender, and each
Related Party of any of the foregoing Persons (each such Person being called an
“Indemnitee”) against, and hold each Indemnitee harmless from, any and all losses, claims,
damages, liabilities and related expenses, including the reasonable fees, charges and disbursements
of any counsel for any Indemnitee, incurred by or asserted against any Indemnitee arising out of,
in connection with, or as a result of (i) the arrangement and the syndication of the credit
facility provided for herein, the preparation, execution, delivery and administration of the Loan
Documents or any other agreement or instrument contemplated hereby, the performance by the parties
to the Loan Documents of their respective obligations thereunder or the consummation of the
Transactions or any other transactions contemplated hereby, (ii) any Loan or Letter of Credit or
the use of the proceeds

 

69

therefrom
(including any refusal by any Issuing Bank to honor a demand for payment under a Letter of Credit if the documents presented in
connection with such demand do not strictly comply with the terms of such Letter of Credit), (iii)
any actual or alleged presence or release of Hazardous Materials on or from any Mortgaged Property
or any other property currently or formerly owned or operated by the Borrower or any of its
Subsidiaries, or any Environmental Liability related in any way to the Borrower or any of its
Subsidiaries, or (iv) any actual or prospective claim, litigation, investigation or proceeding
relating to any of the foregoing, whether based on contract, tort or any other theory and
regardless of whether any Indemnitee is a party thereto and regardless of whether such matter is
initiated by a third party or by the Borrower or any Affiliate thereof; 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 gross negligence or willful misconduct
of such Indemnitee (it being understood that the violation by a Lender or an Agent of any
applicable law or regulation shall constitute gross negligence) or the breach by such Indemnitee of
its obligations under the Loan Documents; provided, further, that the fees,
disbursements and other charges of counsel with respect to any claim, litigation or proceeding
shall be limited to one firm of counsel in each relevant jurisdiction to jointly represent all such
Indemnitees, so long as (i) no conflict or potential conflict exists as a result of such joint
representation and (ii) no Indemnitee has reasonably concluded that there may be legal defenses
available to it that are different from or in addition to those available to the other Indemnitees.

          (c) To the extent that the Borrower fails to pay any amount required to be paid by it to
either Agent or any Issuing Bank under paragraph (a) or (b) of this Section, each Lender severally
agrees to pay to such Agent or Issuing Bank, as the case may be, such Lender’s pro rata share
(determined as of the time that the applicable unreimbursed expense or indemnity payment is sought)
of such unpaid amount; provided that the unreimbursed expense or indemnified loss, claim,
damage, liability or related expense, as the case may be, was incurred by or asserted against such
Agent or Issuing Bank in its capacity as such. For purposes hereof, a Lender’s “pro rata share”
shall be determined based upon its share of the sum of the outstanding Revolving Exposures and
unused Commitments at the time.

          (d) To the extent permitted by applicable law, the Borrower shall not assert, and hereby
waives, any claim against any Indemnitee, on any theory of liability, for special, indirect,
consequential or punitive damages (as opposed to direct or actual damages) arising out of, in
connection with, or as a result of, this Agreement or any agreement or instrument contemplated
hereby, the Transactions, any Loan or Letter of Credit or the use of the proceeds thereof. No
Indemnitee shall be liable for the use by others of Information (as defined in Section 9.12) or
other materials obtained through electronic telecommunications or other information transmission
systems (including as a result of any misdirected facsimile transmission); provided, that
(except in the case of a misdirected facsimile transmission) such indemnified person shall have
taken reasonable precautions to ensure, or shall have made reasonable investigation to believe in,
the reliability of such transmission system.

          (e) All amounts due under this Section shall be payable promptly after written demand
therefor.

 

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          SECTION 9.04. Successors and Assigns. (a) The provisions of this Agreement shall be
binding upon and inure to the benefit of the parties hereto and their respective successors and
assigns permitted hereby (including any Affiliate of an Issuing Bank that issues any Letter of
Credit), except that the Borrower may not assign or otherwise transfer any of its rights or
obligations hereunder without the prior written consent of each Lender (and any attempted
assignment or transfer by the Borrower without such consent shall be null and void). Nothing in
this Agreement, expressed or implied, shall be construed to confer upon any Person (other than the
parties hereto, their respective successors and assigns permitted hereby (including any Affiliate
of an Issuing Bank that issues any Letter of Credit) and, to the extent expressly contemplated
hereby, the Related Parties of each of the Agents, the Issuing Banks and the Lenders) any legal or
equitable right, remedy or claim under or by reason of this Agreement.

          (b) Any Lender may assign to one or more assignees all or a portion of its rights and
obligations under this Agreement (including all or a portion of its Commitment and the Loans at the
time owing to it); provided that (i) (A) except in the case of an assignment to a Lender
or an Affiliate of a Lender, each of the Borrower and the Co-Administrative Agent, and (B) in the
case of an assignment of all or a portion of a Commitment or any Lender’s obligation in respect of
its LC Exposure, each Issuing Bank, must give their prior written consent to any such assignment
(which consent shall not be unreasonably withheld), (ii) except in the case of an assignment to a
Lender or an Affiliate of a Lender or an assignment of the entire remaining amount of the assigning
Lender’s Commitment or Loans, the amount of the Commitment or Loans 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 Co-Administrative Agent) shall not be less than $5,000,000
unless each of the Borrower and the Co-Administrative Agent otherwise consent, (iii) each partial
assignment shall be made as an assignment of a proportionate part of all the assigning Lender’s
rights and obligations under this Agreement, (iv) the parties to each assignment shall execute and
deliver to the Co-Administrative Agent an Assignment and Acceptance, together with a processing and
recordation fee of $3,500, and (v) the assignee, if it shall not be a Lender, shall deliver to the
Co-Administrative Agent an Administrative Questionnaire; and provided further that any
consent of the Borrower otherwise required under this paragraph shall not be required if an Event
of Default under clause (a), (b), (h) or (i) of Article VII has occurred and is continuing.
Subject to acceptance and recording thereof pursuant to paragraph (d) of this Section, from and
after the effective date specified in each Assignment and Acceptance 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 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, other than liability for breach prior to the
effective date of such Assignment and Acceptance (and, in the case of an Assignment and Acceptance
covering all of the 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
2.13, 2.14, 2.15 and 9.03 and shall continue to be bound by Section 9.12). Any assignment or
transfer by a Lender of rights or obligations under this Agreement that does not comply with this
paragraph shall be treated for purposes of this Agreement as a sale by such Lender of a
participation in such rights and obligations in accordance with paragraph (e) of this Section.

 

71

          (c) The Co-Administrative Agent, acting for this purpose as an agent of the Borrower, shall
maintain at one of its offices in The City of Greenwood Village 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 and LC Disbursements 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 Agents, the Issuing Banks 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 Banks and any Lender,
at any reasonable time and from time to time upon reasonable prior notice.

          (d) Upon its receipt of a duly completed Assignment and Acceptance executed by an assigning
Lender and an assignee, the assignee’s completed Administrative Questionnaire (unless the assignee
shall already be a Lender hereunder), the processing and recordation fee referred to in paragraph
(b) of this Section and any written consent to such assignment required by paragraph (b) of this
Section, the Co-Administrative Agent shall accept such Assignment and Acceptance and record the
information contained therein in the Register. No assignment shall be effective for purposes of
this Agreement unless it has been recorded in the Register as provided in this paragraph.

          (e) Any Lender may, without the consent of the Borrower, the Co-Administrative Agent or either
Issuing Bank, sell participations to one or more banks or other entities (a “Participant”)
in all or a portion of such Lender’s rights and obligations under this Agreement (including all or
a portion of its Commitment and the Loans owing to it); provided 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 and (iii) the
Borrower, the Agents, the Issuing Banks and the other Lenders shall continue to deal solely and
directly with such Lender in connection with such Lender’s rights and obligations under this
Agreement. Any agreement or instrument pursuant to which a Lender sells such a participation shall
provide that such Lender shall retain the sole right to enforce the Loan Documents and to approve
any amendment, modification or waiver of any provision of the Loan Documents; provided that
such agreement or instrument may provide that such Lender will not, without the consent of the
Participant, agree to any amendment, modification or waiver described in the first proviso to
Section 9.02(b) that affects such Participant. Subject to paragraph (f) of this Section, the
Borrower agrees that each Participant shall be entitled to the benefits of Sections 2.13, 2.14 and
2.15 to the same extent as if it were a Lender and had acquired its interest by assignment pursuant
to paragraph (b) of this Section. To the extent permitted by law, each Participant also shall be
entitled to the benefits of Section 9.08 as though it were a Lender, provided such Participant
agrees to be subject to Section 2.16(c) as though it were a Lender.

          (f) A Participant shall not be entitled to receive any greater payment under Section 2.13 or
2.15 than the applicable Lender would have been entitled to receive with respect to the
participation sold to such Participant, unless the sale of the participation to such Participant is
made with the Borrower’s prior written consent. A Participant that would be a Foreign Lender if it
were a Lender shall not be entitled to the benefits

 

72

of
Section 2.15 unless the Borrower is notified of the participation sold to such Participant and such Participant agrees, for the
benefit of the Borrower, to comply with Section 2.15(e) as though it were a Lender.

          (g) Any Lender may at any time pledge or assign a security interest in all or any portion of
its rights under this Agreement to secure obligations of such Lender, including any pledge or
assignment to secure obligations to a Federal Reserve Bank, and this Section shall not apply to any
such pledge or assignment of a security interest; provided that no such pledge or
assignment of a security interest shall release a Lender from any of its obligations hereunder or
substitute any such pledgee or assignee for such Lender as a party hereto.

          SECTION 9.05. Survival. All covenants, agreements, representations and warranties
made by the Loan Parties in the Loan Documents and in the certificates or other instruments
delivered in connection with or pursuant to this Agreement or any other Loan Document shall be
considered to have been relied upon by the other parties hereto and shall survive the execution and
delivery of the Loan Documents and the making of any Loans and the issuance of any Letters of
Credit, regardless of any investigation made by any such other party or on its behalf and
notwithstanding that any Agent, any Issuing Bank or any Lender may have had notice or knowledge of
any Default or incorrect representation or warranty at the time any credit is extended hereunder,
and shall continue in full force and effect as long as the principal of or any accrued interest on
any Loan or any fee or any other amount payable under this Agreement is outstanding and unpaid or
any Letter of Credit is outstanding and so long as the Commitments have not expired or terminated.
The provisions of Sections 2.13, 2.14, 2.15 and 9.03 and Article VIII shall survive and remain in
full force and effect regardless of the consummation of the transactions contemplated hereby, the
repayment of the Loans, the expiration or termination of the Letters of Credit and the Commitments
or the termination of this Agreement or any provision hereof.

          SECTION 9.06. Counterparts; Integration; Effectiveness. 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. This Agreement, the other Loan Documents and any separate letter agreements with respect
to fees payable to either Agent or Issuing Bank constitute the entire contract among the parties
relating to the subject matter hereof and supersede any and all previous agreements and
understandings, oral or written, relating to the subject matter hereof. Except as provided in
Section 4.01, this Agreement shall become effective when it shall have been executed by 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
successors and assigns. Delivery of an executed counterpart of a signature page of this Agreement
by telecopy or electronic image scan shall be effective as delivery of a manually executed
counterpart of this Agreement.

          SECTION 9.07. Severability. Any provision of this Agreement held to be invalid,
illegal or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the
extent of such invalidity, illegality or unenforceability without affecting the validity, legality
and enforceability of the remaining provisions hereof; and the invalidity of a particular provision
in a particular jurisdiction shall not invalidate such provision in any other jurisdiction.

 

73

          SECTION 9.08. Right of Setoff. If an Event of Default shall have occurred and be
continuing, each Lender and each of its Affiliates is hereby authorized at any time and from time
to time, to the fullest extent permitted 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 obligations at any
time owing by such Lender or Affiliate 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 held
by such Lender, irrespective of whether or not such Lender shall have made any demand under this
Agreement and although such obligations may be unmatured. The rights of each Lender under this
Section are in addition to other rights and remedies (including other rights of setoff) which such
Lender may have.

          SECTION 9.09. Governing Law; Jurisdiction; Consent to Service of Process. (a) This
Agreement shall be construed in accordance with and governed by the law of the State of New York.

          (b) The Borrower hereby irrevocably and unconditionally submits, for itself and its property,
to the nonexclusive jurisdiction of the Supreme Court of the State of New York sitting in New York
County and of the United States District Court of the Southern District of New York, and any
appellate court from any thereof, in any action or proceeding arising out of or relating to any
Loan Document, 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 or any other Loan
Document shall affect any right that any Agent, Issuing Bank or Lender may otherwise have to bring
any action or proceeding relating to this Agreement or any other Loan Document against the Borrower
or its properties in the courts of any jurisdiction.

          (c) The Borrower 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 any other
Loan Document in any court referred to in paragraph (b) of this Section. 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.

          (d) 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 or any other Loan Document will
affect the right of any party to this Agreement to serve process in any other manner permitted by
law.

          SECTION 9.10. 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 ANY LEGAL
PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT, ANY OTHER LOAN
DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER
THEORY). EACH

 

74

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 BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND
CERTIFICATIONS IN THIS SECTION.

          SECTION 9.11. 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 shall not affect
the construction of, or be taken into consideration in interpreting, this Agreement.

          SECTION 9.12. Confidentiality. Each of the Agents, the Issuing Banks and the Lenders
agrees to maintain the confidentiality of the Information (as defined below), except that
Information may be disclosed (a) to its and its Affiliates’ directors, officers, employees,
trustees, investment advisors and agents, including accountants, legal counsel and other advisors
(it being understood that the Persons to whom such disclosure is made will be informed of the
confidential nature of such Information and instructed to keep such Information confidential), (b)
to the extent requested by any banking regulatory authority, (c) to the extent requested by any
insurance authority or other Governmental Authority or required by applicable laws or regulations
or by any subpoena or similar legal process, (d) to any other party to this Agreement, (e) in
connection with the exercise of any remedies hereunder or any suit, action or proceeding relating
to this Agreement or any other Loan Document or the enforcement of rights hereunder or thereunder,
(f) subject to an agreement containing provisions substantially the same as those of this Section,
to (i) any assignee of or Participant in, or any prospective assignee of or Participant in, any of
its rights or obligations under this Agreement or (ii) any actual or prospective counterparty (or
its advisors) to any swap or derivative transaction relating to the Borrower, its Subsidiaries and
their obligations, (g) with the consent of the Borrower, (h) to the extent such Information (i)
becomes publicly available other than as a result of a breach of this Section or (ii) becomes
available to any Agent, Issuing Bank or Lender on a nonconfidential basis from a source other than
the Borrower or (i) to any rating agency when required by it (it being understood that, prior to
any such disclosure, such rating agency shall undertake to preserve the confidentiality of any
Information received by it from the disclosing party); provided, that the disclosing party
shall use reasonable efforts under the circumstances, to the extent permitted by law, to notify the
Borrower prior to, or as soon as practicable thereafter, of any disclosure made pursuant to clause
(c) above. In addition, the Agents, the Issuing Banks and the Lenders may disclose the existence
of this Agreement and information about this Agreement (but not Information concerning the business
of the Borrower or any of its Affiliates) to market data collectors, similar service providers to
the lending industry, and service providers to the Agents, the Issuing Banks and the Lenders in
connection with the administration and management of this Agreement, the other Loan Documents and
the Commitments. For the purposes of this Section 9.12, “Information” means all
information received from any Loan Party relating to any Loan Party or its Affiliates or their
businesses, other than any such information that is publicly available to any Agent, any Issuing
Bank or any Lender prior to disclosure by any Loan Party.

 

75

          EACH LENDER ACKNOWLEDGES THAT INFORMATION AS DEFINED IN SECTION 9.12 FURNISHED TO IT PURSUANT
TO THIS AGREEMENT MAY INCLUDE MATERIAL NON-PUBLIC INFORMATION CONCERNING THE BORROWER AND ITS
RELATED PARTIES OR THEIR RESPECTIVE SECURITIES, AND CONFIRMS THAT IT HAS DEVELOPED COMPLIANCE
PROCEDURES REGARDING THE USE OF MATERIAL NON-PUBLIC INFORMATION AND THAT IT WILL HANDLE SUCH
MATERIAL NON-PUBLIC INFORMATION IN ACCORDANCE WITH THOSE PROCEDURES AND APPLICABLE LAW, INCLUDING
FEDERAL AND STATE SECURITIES LAWS.

          ALL INFORMATION, INCLUDING WAIVERS AND AMENDMENTS, FURNISHED BY THE BORROWER OR THE
ADMINISTRATIVE AGENT PURSUANT TO, OR IN THE COURSE OF ADMINISTERING, THIS AGREEMENT WILL BE
SYNDICATE-LEVEL INFORMATION, WHICH MAY CONTAIN MATERIAL NON-PUBLIC INFORMATION ABOUT THE BORROWER,
THE LOAN PARTIES AND THEIR RELATED PARTIES OR THEIR RESPECTIVE SECURITIES. ACCORDINGLY, EACH
LENDER REPRESENTS TO THE BORROWER AND THE ADMINISTRATIVE AGENT THAT IT HAS IDENTIFIED IN ITS
ADMINISTRATIVE QUESTIONNAIRE A CREDIT CONTACT WHO MAY RECEIVE INFORMATION THAT MAY CONTAIN MATERIAL
NON-PUBLIC INFORMATION IN ACCORDANCE WITH ITS COMPLIANCE PROCEDURES AND APPLICABLE LAW.

          SECTION 9.13. Interest Rate Limitation. Notwithstanding anything herein to the
contrary, if at any time the interest rate applicable to any Loan, together with all fees, charges
and other amounts which are treated as interest on such Loan 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 in accordance
with applicable law, the rate of interest payable in respect of such Loan 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 but were not
payable as a result of the operation of this Section shall be cumulated and the interest and
Charges payable to such Lender in respect of other Loans 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 9.14. Optional Release of Collateral. (a) Notwithstanding any other
provision herein or in any other Loan Document, the Collateral Agent is hereby authorized and
directed to, and shall, release all, but not less than all, of the Collateral from the Liens of the
Security Documents (but not the Guarantees provided pursuant to the Collateral Agreement) on a
Business Day specified by the Borrower (the “Optional Release Date”), upon the satisfaction
of the following conditions precedent (the “Optional Release Conditions”), and subject to
the reinstatement of such Liens as provided in paragraph (b) below:

     (i) the Borrower shall have given notice to the Collateral Agent at least 30 days prior
to the Optional Release Date, specifying the proposed Optional Release Date;

 

76

     (ii) the Collateral Release Ratings Requirement shall have been satisfied as of the
date of such notice and shall remain satisfied as of the Optional Release Date;

     (iii) no Default or Event of Default hereunder shall have occurred and be continuing as
of the date of such notice or as of the Optional Release Date;

     (iv) all Liens in the Collateral securing the Senior Second Lien Note Obligations
pursuant to the Second Lien Security Documents have been released as of the Optional Release
Date or are released simultaneously with the release of the Collateral from the Liens of the
Security Documents pursuant to this Section; and

     (v) on the Optional Release Date, the Administrative Agent shall have received (x) a
certificate, dated the Optional Release Date and executed on behalf of the Borrower by a
Financial Officer thereof, confirming the satisfaction of the Optional Release Conditions
set forth in clauses (ii), (iii) and (iv) above and (y) such other evidence as it may
reasonably require confirming the satisfaction of the Optional Release Condition set forth
in clause (iv) above.

During the continuance of any Collateral Release Period, but not otherwise, all representations and
warranties and covenants contained in the Collateral Agreement and any other Security Document
related to the Collateral or the grant or perfection of Liens on the Collateral shall be deemed to
be of no force or effect. Any such release shall be without recourse to, or representation or
warranty by, the Collateral Agent and shall not require the consent of any Lender. Subject to the
satisfaction of the conditions set forth in this paragraph (a), on and after the Optional Release
Date, the Collateral Agent shall execute and deliver all such instruments, releases, financing
statements or other agreements, and take all such further actions, at the request and expense of
the Borrower, as shall be necessary to effectuate the release of Collateral pursuant to the terms
of this paragraph. Subject to reinstatement as provided in paragraph (b), on and after the
Optional Release Date the Loan Parties shall not be subject to the provisions of Sections 5.03,
5.08 and 5.13.

          (b) If, as of any date and following any release of Collateral pursuant to Section 9.14(a),
the Collateral Reinstatement Ratings Requirement shall be or become satisfied, all representations
and warranties and covenants contained in the Collateral Agreement and any other Security Document
related to the Collateral shall be reinstated and shall be in full force and effect and the
requirements of Sections 5.03, 5.08 and 5.13 shall again become applicable to the Loan Parties, and
the Borrower shall promptly take and cause the other Loan Parties to take all such actions as shall
be necessary or as the Collateral Agent shall reasonably request to cause the Guarantee and
Collateral Requirement to be satisfied and for the Liens of the Security Documents to be reinstated
in the Collateral. Following the reinstatement of the Liens of the Security Documents in the
Collateral pursuant to this paragraph (b), if the Optional Release Conditions become satisfied
again, the Borrower may again elect to have such Liens released pursuant to this Section.

          (c) Without limiting the provisions of Section 9.03, the Borrower shall reimburse the
Collateral Agent for all costs and expenses, including attorneys’ fees and disbursements, incurred
by it in connection with any action contemplated by this Section.

 

77

          (d) Notwithstanding the foregoing, following the release of the Collateral from the Liens of
the Security Documents pursuant to this Section, in the event that any Lien securing any
Indebtedness is created or permitted to exist on any property or asset now owned or hereafter
acquired by any Loan Party that would have constituted Collateral under the Security Documents if
the Lien of such documents had not been released (other than Liens permitted by clauses (iii),
(iv), (v), (vi), (vii) and (viii) of Section 6.02), the Borrower shall and shall cause the other
Loan Parties to secure the Obligations at least ratably with the other Indebtedness secured
thereby, in each case in a manner reasonably acceptable to the Administrative Agent.

          SECTION 9.15. USA Patriot Act Notice. Each Lender and Agent (for itself and not on
behalf of any Lender) hereby notifies the Borrower that pursuant to the requirements of the USA
Patriot Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001)) (the “Act”),
it is required to obtain, verify and record information that identifies the Borrower, which
information includes the name and address of the Borrower and other information that will allow
such Lender or Agent, as applicable, to identify the Borrower in accordance with the Act.

[remainder of page intentionally blank – signature page is next page]

 

 

          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.

	 	 	 	 	 
	 	LAND O’LAKES, INC.,

 	 
	 	By  	
 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 

[Signature
Page to Land O’Lakes, Inc. Credit Agreement]

 

 

	 	 	 	 	 

	 	 	 	 	 
	 	JPMORGAN CHASE BANK, N.A., individually and as

Administrative Agent,

 	 
	 	By  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 

[Signature
Page to Land O’Lakes, Inc. Credit Agreement]

 

 

	 	 	 	 	 

	 	 	 	 	 
	 	COBANK, ACB., individually and as Co-

Administrative Agent,

 	 
	 	By  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 

[Signature
Page to Land O’Lakes, Inc. Credit Agreement]

 

 

	 	 	 	 	 

	 	 	 	 	 	 	 
	 

	 	Lender:	 	 	 	 
	 

	 	 	 	 

	 	 
	 

	 	By	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Name:	 	 
	 

	 	 	 	Title:	 	 

[Signature
Page to Land O’Lakes, Inc. Credit Agreement]

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