Document:

EX-4.1

 

Exhibit 4.1

 

AMENDED AND RESTATED CREDIT AGREEMENT

among

THE SCOTTS MIRACLE-GRO COMPANY,

as Borrower

The Subsidiary Borrowers From Time to Time Party Hereto,

The Several Lenders From Time to Time Party Hereto,

JPMORGAN CHASE BANK, N.A.,

as Administrative Agent,

BANK OF AMERICA, N.A.,

as Syndication Agent,

and

THE BANK OF TOKYO-MITSUBUSHI UFJ. LTD,

BNP PARIBAS,

COBANK, ACB,

BMO CAPITAL MARKETS FINANCING, INC.,

LASALLE BANK N.A.,

COOPERATIEVE CENTRALE RAIFFEISEN BOERENLEENBANK, B.A.

“RABOBANK NEDERLAND”, NEW YORK BRANCH,

CITICORP NORTH AMERICA, INC.

and

THE BANK OF NOVA SCOTIA,

as Documentation Agents

 

Dated as of February 7, 2007

 

 

J.P. MORGAN SECURITIES INC.

and

BANC OF AMERICA SECURITIES LLC,

as Joint Lead Arrangers and Joint Bookrunners,

and

CITIGROUP GLOBAL MARKETS INC.,

as Co-Arranger and Joint Bookrunner

 

 

TABLE OF CONTENTS

	 	 	 	 	 	 	 
	 	 	 	Page	 
	 
	SECTION 1. DEFINITIONS	 	 	1	 
	1.1

	 	Defined Terms
	 	 	1	 
	1.2

	 	Other Definitional Provisions
	 	 	26	 
	 
	 	 	 	 	 	 
	SECTION 2. AMOUNT AND TERMS OF LOANS	 	 	27	 
	2.1

	 	Term Commitments
	 	 	27	 
	2.2

	 	Procedure for Term Loan Borrowing
	 	 	27	 
	2.3

	 	Repayment of Term Loan
	 	 	27	 
	2.4

	 	Revolving Credit Commitment
	 	 	28	 
	2.5

	 	Procedure for Revolving Credit Borrowing
	 	 	29	 
	2.6

	 	Swing Line Commitments
	 	 	30	 
	2.7

	 	Participation
	 	 	32	 
	2.8

	 	Repayment of Revolving Credit Loans; Evidence of Debt
	 	 	32	 
	2.9

	 	Commitment Fee, etc
	 	 	33	 
	2.10

	 	Termination or Reduction of Commitments
	 	 	33	 
	2.11

	 	Optional Prepayments
	 	 	34	 
	2.12

	 	Mandatory Prepayments
	 	 	35	 
	2.13

	 	Cash Collateralization of Letters of Credit
	 	 	36	 
	2.14

	 	Conversion Options
	 	 	36	 
	2.15

	 	Interest Rate and Payment Dates
	 	 	36	 
	2.16

	 	Computation of Interest and Fees
	 	 	37	 
	2.17

	 	Inability to Determine Interest Rate
	 	 	37	 
	2.18

	 	Pro Rata Treatment and Payments
	 	 	38	 
	2.19

	 	Illegality
	 	 	39	 
	2.20

	 	Requirements of Law
	 	 	40	 
	2.21

	 	Indemnity
	 	 	41	 
	2.22

	 	Taxes
	 	 	41	 
	2.23

	 	Use of Proceeds
	 	 	43	 
	2.24

	 	Controls on Prepayment if Aggregate Revolving
Extensions of Credit Exceed
Aggregate Revolving Credit Commitments
	 	 	43	 
	2.25

	 	Lending Installations
	 	 	44	 
	2.26

	 	Notices to Lenders
	 	 	45	 
	2.27

	 	Incremental Term Facilities; Revolving
Credit Commitment Increases and
Changes; Incremental Term Loans
	 	 	45	 
	 
	 	 	 	 	 	 
	SECTION 3. LETTER OF CREDIT FACILITIES	 	 	47	 
	3.1

	 	L/C Commitment
	 	 	47	 
	3.2

	 	Procedure for Issuance of Letters of Credit
	 	 	47	 
	3.3

	 	Fees, Commissions and Other Charges
	 	 	48	 
	3.4

	 	L/C Participation
	 	 	48	 
	3.5

	 	Reimbursement Obligation of the Borrower
	 	 	49	 
	3.6

	 	Obligations Absolute
	 	 	50	 
	3.7

	 	Increased Costs
	 	 	50	 
	3.8

	 	Letter of Credit Payments
	 	 	50	 
	 
	 	 	 	 	 	 
	SECTION 4. REPRESENTATIONS AND WARRANTIES	 	 	51	 

 

 

	 	 	 	 	 	 	 
	 	 	 	Page	 
	 
	4.1

	 	Financial Condition
	 	 	51	 
	4.2

	 	Corporate Existence; Compliance with Law
	 	 	51	 
	4.3

	 	Corporate Power; Authorization; Enforceable Obligations
	 	 	52	 
	4.4

	 	No Legal Bar
	 	 	52	 
	4.5

	 	No Material Litigation
	 	 	52	 
	4.6

	 	No Burdensome Restrictions
	 	 	52	 
	4.7

	 	No Default
	 	 	52	 
	4.8

	 	Subsidiaries
	 	 	52	 
	4.9

	 	Disclosure
	 	 	53	 
	4.10

	 	Schedules
	 	 	53	 
	4.11

	 	Federal Regulations
	 	 	53	 
	4.12

	 	Investment Company Act; Other Regulations
	 	 	53	 
	4.13

	 	Labor Matters
	 	 	53	 
	4.14

	 	ERISA
	 	 	53	 
	4.15

	 	Title to Real Property, Etc.
	 	 	54	 
	4.16

	 	Taxes
	 	 	54	 
	4.17

	 	Environmental Matters
	 	 	54	 
	4.18

	 	Intellectual Property
	 	 	55	 
	4.19

	 	Security Documents
	 	 	55	 
	4.20

	 	Solvency
	 	 	55	 
	 
	 	 	 	 	 	 
	SECTION 5. CONDITIONS PRECEDENT	 	 	56	 
	5.1

	 	Conditions to Effectiveness of this Agreement
	 	 	56	 
	5.2

	 	Conditions to All Extensions of Credit
	 	 	58	 
	5.3

	 	Additional Conditions Applicable to Foreign Subsidiary Borrowers
	 	 	58	 
	 
	 	 	 	 	 	 
	SECTION 6. AFFIRMATIVE COVENANTS	 	 	60	 
	6.1

	 	Financial Statements
	 	 	60	 
	6.2

	 	Certificates; Other Information
	 	 	60	 
	6.3

	 	Payment of Obligations
	 	 	62	 
	6.4

	 	Compliance with Laws
	 	 	62	 
	6.5

	 	Conduct of Business and Maintenance of Existence
	 	 	62	 
	6.6

	 	Maintenance of Property, Insurance
	 	 	62	 
	6.7

	 	Inspection of Property; Books and Records; Discussions
	 	 	62	 
	6.8

	 	Notices
	 	 	62	 
	6.9

	 	Maintenance of Interest Coverage Ratio
	 	 	63	 
	6.10

	 	Maintenance of Leverage Ratio
	 	 	64	 
	6.11

	 	Additional Collateral, etc.
	 	 	64	 
	6.12

	 	Environmental, Health and Safety Matters
	 	 	66	 
	6.13

	 	Foreign Pledge Agreements
	 	 	67	 
	 
	 	 	 	 	 	 
	SECTION 7. NEGATIVE COVENANTS	 	 	67	 
	7.1

	 	Limitation on Liens
	 	 	68	 
	7.2

	 	Limitation on Contingent Obligations
	 	 	69	 
	7.3

	 	Limitation on Fundamental Changes
	 	 	69	 
	7.4

	 	Limitation on Acquisitions, Investments, Loans and Advances
	 	 	70	 
	7.5

	 	Limitation on Indebtedness
	 	 	71	 
	7.6

	 	Limitation on Restrictions on Subsidiary Distributions
	 	 	72	 
	7.7

	 	Transactions with Affiliates and Officers
	 	 	72	 

-ii-

 

 

	 	 	 	 	 	 	 
	 	 	 	 	Page	 
	7.8

	 	Limitation on Sale of Assets
	 	 	72	 
	7.9

	 	Sale and Leaseback
	 	 	73	 
	7.10

	 	Fiscal Year
	 	 	73	 
	7.11

	 	Modifications of Certain Debt Instruments
	 	 	73	 
	7.12

	 	Negative Pledge Clauses
	 	 	74	 
	7.13

	 	Lines of Business
	 	 	74	 
	7.14

	 	Restricted Payments
	 	 	74	 
	 
	 	 	 	 	 	 
	SECTION 8. EVENTS OF DEFAULT	 	 	75	 
	 
	 	 	 	 	 	 
	SECTION 9. THE ADMINISTRATIVE AGENT	 	 	78	 
	9.1

	 	Appointment
	 	 	78	 
	9.2

	 	Delegation of Duties
	 	 	78	 
	9.3

	 	Exculpatory Provisions
	 	 	78	 
	9.4

	 	Reliance by Administrative Agent
	 	 	79	 
	9.5

	 	Notice of Default
	 	 	79	 
	9.6

	 	Non-Reliance on Administrative Agent, Other Lenders and JPMCB
	 	 	79	 
	9.7

	 	Indemnification
	 	 	80	 
	9.8

	 	Administrative Agent in Its Individual Capacity
	 	 	80	 
	9.9

	 	Parallel Debt
	 	 	80	 
	9.10

	 	Successor Administrative Agent
	 	 	81	 
	9.11

	 	The Syndication Agent and the Documentation Agents
	 	 	81	 
	 
	 	 	 	 	 	 
	SECTION 10. MISCELLANEOUS	 	 	82	 
	10.1

	 	Amendments and Waivers
	 	 	82	 
	10.2

	 	Notices
	 	 	83	 
	10.3

	 	No Waiver; Cumulative Remedies
	 	 	85	 
	10.4

	 	Survival of Representations, Warranties and Indemnities
	 	 	85	 
	10.5

	 	Payment of Expenses and Taxes
	 	 	85	 
	10.6

	 	Successors and Assigns; Participations and Assignments
	 	 	86	 
	10.7

	 	Adjustments; Set-off
	 	 	88	 
	10.8

	 	Enforceability; Usury
	 	 	89	 
	10.9

	 	Judgment
	 	 	90	 
	10.10

	 	Counterparts
	 	 	90	 
	10.11

	 	Governing Law; No Third Party Rights
	 	 	90	 
	10.12

	 	Headings
	 	 	91	 
	10.13

	 	Submission To Jurisdiction; Waivers
	 	 	91	 
	10.14

	 	Acknowledgments
	 	 	92	 
	10.15

	 	Confidentiality
	 	 	92	 
	10.16

	 	WAIVERS OF JURY TRIAL
	 	 	93	 
	10.17

	 	Severability
	 	 	93	 
	10.18

	 	USA PATRIOT Act
	 	 	93	 

  -iii-

 

	 	 	 	 	 
	ANNEXES

	 	 	 	 
	 
	 	 	 	 
	Annex A

	 	Pricing Grid	 	 
	Annex B

	 	Sterling Borrower Provisions	 	 
	Annex C

	 	Australian Borrower Provisions	 	 
	Annex D

	 	Canadian Borrower Provisions	 	 
	 
	 	 	 	 
	SCHEDULES
	 	 	 	 
	 
	 	 	 	 
	Schedule 1

	 	Lenders; Revolving Credit Commitments	 	 
	Schedule 1.2

	 	Non-Guarantor Domestic Subsidiaries	 	 
	Schedule 4.1

	 	Certain Financial Information	 	 
	Schedule 4.5

	 	Litigation	 	 
	Schedule 4.8

	 	Subsidiaries	 	 
	Schedule 4.11

	 	Certain Transactions	 	 
	Schedule 4.17

	 	Environmental Matters	 	 
	Schedule 4.19(ii)

	 	Certain Filings	 	 
	Schedule 4.19(iii)

	 	Perfection of Foreign Stock Pledges	 	 
	Schedule 5.3(iii)

	 	Certain Filings	 	 
	Schedule 6.13

	 	Foreign Pledge Agreements	 	 
	Schedule 7.1(i)

	 	Existing Liens and Encumbrances	 	 
	Schedule 7.2(iii)

	 	Existing Guarantees	 	 
	Schedule 7.5(c)

	 	Existing Indebtedness	 	 
	Schedule 7.9

	 	Sale and Leaseback	 	 
	Schedule 10.2

	 	Notices	 	 
	 
	 	 	 	 
	EXHIBITS
	 	 	 	 
	 
	 	 	 	 
	Exhibit A

	 	Form of Assignment and Acceptance	 	 
	Exhibit B

	 	Form of Amended and Restated Guarantee and Collateral Agreement	 	 
	Exhibit C

	 	Form of Swing Line Loan Participation Certificate	 	 
	Exhibit D

	 	Form of U.S. Tax Compliance Certificate	 	 
	Exhibit E

	 	Form of Incremental Commitment Supplement	 	 
	Exhibit F

	 	Form of Foreign Pledge Agreement Acknowledgment and Confirmation	 	 
	Exhibit G

	 	Form of Opinion of Vorys, Sater, Seymour and Pease LLP	 	 
	Exhibit H

	 	Form of Opinion of Counsel to Foreign Subsidiary Borrowers	 	 
	Exhibit I

	 	Form of Borrowing Certificate	 	 
	Exhibit J

	 	Form of New Domestic Subsidiary Certificate	 	 
	Exhibit K

	 	Form of Joinder Agreement	 	 

-v-

 

 

          AMENDED AND RESTATED CREDIT AGREEMENT, dated as of February 7, 2007 by and among THE
SCOTTS MIRACLE-GRO COMPANY, an Ohio corporation (the “Borrower”), the Subsidiary Borrowers
(as defined herein) from time to time parties to this agreement, the several banks and other
financial institutions from time to time parties to this Agreement (the “Lenders”), BANK OF
AMERICA, N.A., as Syndication Agent, THE BANK OF TOKYO-MITSUBUSHI UFJ. LTD, BNP PARIBAS, COBANK,
ACB, BMO CAPITAL MARKETS FINANCING, INC., LASALLE BANK N.A., COOPERATIEVE CENTRALE RAIFFEISEN
BOERENLEENBANK, B.A. “RABOBANK NEDERLAND”, NEW YORK BRANCH and THE BANK OF NOVA SCOTIA, as
Documentation Agents, and JPMORGAN CHASE BANK, N.A., (together with its banking affiliates,
“JPMCB”), as agent for the Lenders hereunder (in such capacity, the “Administrative
Agent”).

W I T N E S S E T H :

          WHEREAS, the Borrower desires to amend and restate the Revolving Credit Agreement dated as of
July 21, 2005 (as heretofore amended, supplemented or otherwise modified, the “Existing Credit
Agreement”), among the Borrower, the Subsidiary Borrowers, the several banks and other
financial institutions parties thereto and JPMCB, as administrative agent, in accordance with the
terms and conditions set forth in this Agreement; and

          WHEREAS, the Lenders and the Administrative Agent consent to the proposed amendments and
restatements on and subject to the terms and conditions set forth herein.

          NOW, THEREFORE, in consideration of the premises and the mutual agreements herein contained,
the parties hereto agree as follows:

          SECTION 1. DEFINITIONS

          1.1 Defined Terms. As used in this Agreement, the following terms have the following meanings:

     “ABR” shall mean for any day, a rate per annum (rounded upwards, if necessary,
to the next 1/16 of 1%) equal to the greater of (a) the Prime Rate in effect on such day and
(b) the Federal Funds Effective Rate in effect on such day plus 1/2 of 1%. For purposes
hereof: “Prime Rate” shall mean the rate of interest per annum publicly announced
from time to time by the Administrative Agent as its prime rate in effect at its principal
office in New York City (the Prime Rate not being intended to be the lowest rate of interest
charged by JPMCB in connection with extensions of credit to debtors); and “Federal Funds
Effective Rate” shall mean, for any day, the weighted average of the rates on overnight
federal funds transactions with members of the Federal Reserve System arranged by federal
funds brokers, as published on the next succeeding Business Day by the Federal Reserve Bank
of New York, or, if such rate is not so published for any day which is a Business Day, the
average of the quotations for the day of such transactions received by the Administrative
Agent from three federal funds brokers of recognized standing selected by it. Any change in
the ABR due to a change in the Prime Rate or the Federal Funds Effective Rate shall be
effective as of the opening of business on the effective day of such change in the Prime
Rate or the Federal Funds Effective Rate, as applicable.

     “ABR Loans” shall mean the Loans at such time as they are made and/or being
maintained at a rate of interest based upon the ABR.

 

 

2

     “Adjustment Date” shall have the meaning set forth in the Pricing Grid.

     “Affiliate” shall mean any Person which, directly or indirectly, controls, is
controlled by or is under common control with, the Borrower; provided that for
purposes of subsection 7.7, the term “Affiliate” shall (i) include any Person who is a
director or executive officer of the Borrower, any Subsidiary of the Borrower or any Person
described in the clause preceding this proviso and (ii) exclude any Subsidiary of the
Borrower. For purposes of this definition, “control” of a Person means the power, direct or
indirect, to vote 20% or more of the Capital Stock having voting power for the election of
directors of such Person or otherwise to direct or cause the direction of the management and
policies of such Person, whether by contract or otherwise.

     “Aggregate Australian Revolving Extensions of Credit” shall mean an amount
equal to the sum of (a) the aggregate principal amount of all Australian Dollar Loans
(including, without limitation, Australian Dollar Swing Line Loans borrowed under Australian
Commitments) then outstanding and (b) the aggregate amount of all Australian L/C Obligations
then outstanding.

     “Aggregate Canadian Revolving Extensions of Credit” shall mean an amount equal
to the sum of (a) the aggregate principal amount of all Canadian Dollar Loans (including,
without limitation, Canadian Dollar Swing Line Loans borrowed under Canadian Commitments)
then outstanding and (b) the aggregate amount of all Canadian L/C Obligations then
outstanding.

     “Aggregate Exposure” shall mean, with respect to any Lender at any time, an
amount equal to (a) until the Closing Date, the aggregate amount of such Lender’s
Commitments at such time and (b) thereafter, the sum of (i) the amount of such Lender’s Term
Commitment then in effect plus the then unpaid principal amount of such Lender’s
portion of the Term Loan and (ii) the amount of such Lender’s Revolving Credit Commitment
then in effect or, if the Revolving Credit Commitments have been terminated, the amount of
such Lender’s Revolving Extensions of Credit then outstanding.

     “Aggregate Exposure Percentage” shall mean, with respect to any Lender at any
time, the ratio (expressed as a percentage) of such Lender’s Aggregate Exposure at such time
to the Aggregate Exposure of all Lenders at such time.

     “Aggregate Facility A-1 Revolving Extensions of Credit” shall mean an amount
equal to the sum of (a) the aggregate principal amount of all Facility A-1 Loans (including,
without limitation, Swing Line Loans borrowed under Facility A-1 Commitments) then
outstanding and (b) the aggregate amount of all L/C Obligations then outstanding in respect
of Letters of Credit issued under the Facility A-1 Commitments.

     “Aggregate Facility A-2 Revolving Extensions of Credit” shall mean an amount
equal to the sum of (a) the aggregate principal amount of all Facility A-2 Loans (including,
without limitation, Swing Line Loans borrowed under Facility A-2 Commitments) then
outstanding and (b) the aggregate amount of all L/C Obligations then outstanding in respect
of Letters of Credit issued under the Facility A-2 Commitments.

     “Aggregate Facility B Revolving Extensions of Credit” shall mean an amount
equal to the sum of (a) the aggregate principal amount of all Facility B Loans (including,
without limitation, Swing Line Loans borrowed under Facility B Commitments) then outstanding
and (b) the aggregate amount of all L/C Obligations then outstanding in respect of Letters
of Credit issued under the Facility B Commitments.

 

3

     “Aggregate Facility C Revolving Extensions of Credit” shall mean an amount
equal to the sum of (a) the aggregate principal amount of all Facility C Loans (including,
without limitation, Swing Line Loans borrowed under Facility C Commitments) then outstanding
and (b) the aggregate amount of all L/C Obligations then outstanding in respect of Letters
of Credit issued under the Facility C Commitments.

     “Aggregate Facility D Revolving Extensions of Credit” shall mean an amount
equal to the sum of (a) the aggregate principal amount of all Facility D Loans (including,
without limitation, Swing Line Loans borrowed under Facility D Commitments) then outstanding
and (b) the aggregate amount of all L/C Obligations then outstanding in respect of Letters
of Credit issued under the Facility D Commitments.

     “Aggregate Sterling Revolving Extensions of Credit” shall mean an amount equal
to the sum of (a) the aggregate principal amount of all Sterling Loans (including, without
limitation, Sterling Swing Line Loans borrowed under Sterling Commitments) then outstanding
and (b) the aggregate amount of all Sterling L/C Obligations then outstanding.

     “Aggregate Revolving Extensions of Credit” shall mean, without duplication, the
Aggregate Facility A-1 Revolving Extensions of Credit, Aggregate Facility A-2 Revolving
Extensions of Credit, the Aggregate Facility B Revolving Extensions of Credit, the Aggregate
Facility C Revolving Extensions of Credit, the Aggregate Facility D Revolving Extensions of
Credit, the Aggregate Sterling Revolving Extensions of Credit, the Aggregate Australian
Dollar Revolving Extensions of Credit and the Aggregate Canadian Dollar Revolving Extensions
of Credit.

     “Agreement” shall mean this Amended and Restated Credit Agreement, as amended,
supplemented or otherwise modified from time to time.

     “Applicable Margin” shall mean for each Type of Loan, the rate per annum set
forth under the relevant column heading in the Pricing Grid.

     “Application” shall mean an application, in such form as the Issuing Lender may
specify from time to time, requesting such Issuing Lender to open a Letter of Credit.

     “Arrangers” shall mean J.P. Morgan Securities Inc., Banc of America Securities
LLC and Citigroup Global Markets Inc.

     “Asset Sale” shall mean any single Disposition of property (other than Excluded
Prepayment Property) or series of related Dispositions of property (other than Excluded
Prepayment Property) that yields gross proceeds to the Borrower or any of its Subsidiaries
(valued at the initial principal amount thereof in the case of non-cash proceeds consisting
of notes or other debt securities and valued at fair market value in the case of other
non-cash proceeds) in excess of $10,000,000.

     “Assignment and Acceptance” shall mean an Assignment and Acceptance,
substantially in the form of Exhibit A hereto.

     “Australian Commitments” shall have the meaning assigned to such term in Annex
C hereto.

     “Australian Dollars” shall mean the lawful currency of the Commonwealth of
Australia.

 

4

     “Australian Dollar Lender” shall mean each Lender that has an Australian
Commitment or that holds Australian Dollar Loans; collectively, the “Australian Dollar
Lenders”. Each Australian Dollar Lender on the date hereof and on each date on which a
payment or prepayment of interest is made represents that it is an Eligible Australian Bank.

     “Australian Dollar Loan” shall mean any Australian Dollar Loan made pursuant to
Annex C hereto; collectively, the “Australian Dollar Loans”.

     “Australian Dollar Swing Line Lenders” shall have the meaning assigned to such
term in Annex C hereto.

     “Australian Dollar Swing Line Loans” shall have the meaning assigned to such
term in Annex C hereto.

     “Australian L/C Obligations” shall have the meaning assigned to such term in
Annex C hereto.

     “Australian Subsidiary Borrower” shall mean Scotts Australia Pty Ltd. or any
other Foreign Subsidiary Borrower organized under the laws of the Commonwealth of Australia
and designated as such by the Borrower in a notice to the Administrative Agent, which shall
notify each Australian Lender thereof.

     “Available Australian Commitment” shall mean, as to any Lender at any time, the
amount equal to the excess, if any, of (a) such Lender’s Australian Commitment over
(b) the sum of such Lender’s (i) ratable portion of the Aggregate Facility C Revolving
Extensions of Credit and (ii) ratable portion of the Aggregate Australian Revolving
Extensions of Credit. The Available Australian Commitment may be calculated as being
negative at any time.

     “Available Canadian Commitment” shall mean, as to any Lender at any time, the
amount equal to the excess, if any, of (a) such Lender’s Canadian Commitment over
(b) the sum of such Lender’s (i) ratable portion of the Aggregate Facility D Revolving
Extensions of Credit and (ii) ratable portion of the Aggregate Canadian Revolving Extensions
of Credit. The Available Canadian Commitment may be calculated as being negative at any
time.

     “Available Facility A-1 Commitment” shall mean, as to any Lender at any time,
the amount equal to the excess, if any, of (a) such Lender’s Facility A-1 Commitment
over (b) such Lender’s ratable portion of the Aggregate Facility A-1 Revolving
Extensions of Credit. The Available Facility A-1 Commitment may be calculated as being
negative at any time.

     “Available Facility A-2 Commitment” shall mean, as to any Lender at any time,
the amount equal to the excess, if any, of (a) such Lender’s Facility A-2 Commitment
over (b) such Lender’s ratable portion of the Aggregate Facility A-2 Revolving
Extensions of Credit.

     “Available Facility B Commitment” shall mean, as to any Lender at any time, the
amount equal to the excess, if any, of (a) such Lender’s Facility B Commitment over
(b) the sum of such Lender’s (i) ratable portion of the Aggregate Facility B Revolving
Extensions of Credit and (ii) ratable portion of the Aggregate Sterling Revolving Extensions
of Credit. The Available Facility B Commitment may be calculated as being negative at any
time.

     “Available Facility C Commitment” shall mean, as to any Lender at any time, the
amount equal to the excess, if any, of (a) such Lender’s Facility C Commitment over
(b) the sum of such

 

5

Lender’s (i) ratable portion of the Aggregate Facility C Revolving Extensions of Credit
and (ii) ratable portion of the Aggregate Australian Revolving Extensions of Credit. The
Available Facility C Commitment may be calculated as being negative at any time.

     “Available Facility D Commitment” shall mean, as to any Lender at any time, the
amount equal to the excess, if any, of (a) such Lender’s Facility D Commitment over
(b) the sum of such Lender’s (i) ratable portion of the Aggregate Facility D Revolving
Extensions of Credit and (ii) ratable portion of the Aggregate Canadian Revolving Extensions
of Credit. The Available Facility D Commitment may be calculated as being negative at any
time.

     “Available Sterling Commitment” shall mean, as to any Lender at any time, the
amount equal to the excess, if any, of (a) such Lender’s Sterling Commitment over
(b) the sum of such Lender’s (i) ratable portion of the Aggregate Facility B Revolving
Extensions of Credit and (ii) ratable portion of the Aggregate Sterling Revolving Extensions
of Credit. The Available Sterling Commitment may be calculated as being negative at any
time.

     “Average Total Indebtedness” shall mean the average of the Total Indebtedness
of the Borrower at the end of each of the four most recent consecutive fiscal quarters.

     “Borrowing Date” shall mean, as to any Lender, any Business Day specified in a
notice transmitted pursuant to subsection 2.2, 2.5 or 2.6 as a date on which such Lender has
been requested by the Borrower or any Subsidiary Borrower to make Loans hereunder.

     “Business Day” shall mean a day other than a Saturday, Sunday or other day on
which commercial banks in New York City are authorized or required by law to close;
provided, however, that when used to describe the date of any borrowing of,
or any payment or interest rate determination in respect of a LIBOR Loan, the term “Business
Day” shall also exclude any day on which (i) commercial banks are not open for dealings in
deposits in the relevant currency in the London Interbank Market and in the financial center
for such currency and (ii) in the case of Loans denominated in euros, the Trans-European
Automated Real-time Gross Settlement Express Transfer payment system is not open for
settlement of payments in euros.

     “Canadian Commitments” shall have the meaning assigned to such term in Annex D
hereto.

     “Canadian Dollars” shall mean the lawful currency of Canada.

     “Canadian Dollar Lender” shall mean each Lender that has a Canadian Commitment
or that holds Canadian Dollar Loans; collectively, the “Canadian Dollar Lenders”.
Each Canadian Dollar Lender on the date hereof and on each date on which a payment or
prepayment of interest is made represents that it is an Eligible Canadian Bank.

     “Canadian Dollar Loan” shall mean any Canadian Dollar Loan made pursuant to
Annex D hereto; collectively, the “Canadian Dollar Loans”.

     “Canadian Dollar Swing Line Lenders” shall have the meaning assigned to such
term in Annex D hereto.

     “Canadian Dollar Swing Line Loans” shall have the meaning assigned to such term
in Annex D hereto.

 

6

     “Canadian L/C Obligations” shall have the meaning assigned to such term in
Annex D hereto.

     “Canadian Subsidiary Borrower” shall mean Scotts Canada Ltd. or any other
Foreign Subsidiary Borrower organized under the laws of Canada and designated as such by the
Borrower in a notice to the Administrative Agent, which shall notify each Canadian Lender
thereof.

     “Capital Stock” shall mean any and all shares, interests, participations or
other equivalents (however designated) of capital stock of a corporation, any and all
equivalent ownership interests in a Person (other than a corporation) and any and all
warrants or options to purchase any of the foregoing.

     “Capital Stock Security Period” shall have the meaning specified in the
Guarantee and Collateral Agreement.

     “Cash Equivalents” shall mean (a) marketable direct obligations issued by, or
unconditionally guaranteed by, the United States Government or issued by any agency thereof
and backed by the full faith and credit of the United States, in each case maturing within
one year from the date of acquisition; (b) certificates of deposit, time deposits,
eurodollar time deposits or overnight bank deposits having maturities of one year or less
from the date of acquisition issued by any Lender or by any commercial bank organized under
the laws of the United States or any state thereof having combined capital and surplus of
not less than $300,000,000; (c) commercial paper of an issuer rated at least A-1 by S&P or
P-1 by Moody’s, or carrying an equivalent rating by a nationally recognized rating agency,
if both of the two named rating agencies cease publishing ratings of commercial paper
issuers generally, and maturing within one year from the date of acquisition; (d) repurchase
obligations of any Lender or of any commercial bank satisfying the requirements of clause
(b) of this definition, having a term of not more than 30 days, with respect to securities
issued or fully guaranteed or insured by the United States government; (e) securities with
maturities of one year or less from the date of acquisition issued or fully guaranteed by
any state, commonwealth or territory of the United States, by any political subdivision or
taxing authority of any such state, commonwealth or territory or by any foreign government,
the securities of which state, commonwealth, territory, political subdivision, taxing
authority or foreign government (as the case may be) are rated at least A by S&P or A by
Moody’s; (f) securities with maturities of one year or less from the date of acquisition
backed by standby letters of credit issued by any Lender or any commercial bank satisfying
the requirements of clause (b) of this definition; (g) auction rate securities of an issuer
rated at least AA by S&P or Aa2 by Moody’s, regardless of the stated maturity, so long as
such securities have a liquidity mechanism permitting the Disposition at par within one year
from the issuance of such securities or from the date of the immediately preceding permitted
Disposition of such securities (h) money market mutual or similar funds that invest
exclusively in assets satisfying the requirements of clauses (a) through (f) of this
definition; or (i) money market funds that (i) comply with the criteria set forth in SEC
Rule 2a-7 under the Investment Company Act of 1940, as amended, (ii) are rated AAA by S&P
and Aaa by Moody’s and (iii) have portfolio assets of at least $5,000,000,000.

     “Closing Date” shall mean the date upon which all of the conditions precedent
to the initial Extensions of Credit under this Agreement contained in subsection 5.1 are
satisfied or waived by the Administrative Agent and each of the Lenders.

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

 

7

     “Commitment” shall mean as to any Lender, the sum of the Term Commitment and
the Revolving Credit Commitment of such Lender.

     “Commitment Fee Rate” shall mean the rate per annum set forth under the
relevant column heading in the Pricing Grid.

     “Collateral” shall mean all Specified Property, now owned or hereafter
acquired, upon which a Lien is purported to be created by any Security Document for so long
as required under the terms of this Agreement and the Security Documents.

     “Commonly Controlled Entity” shall mean an entity, whether or not incorporated,
which is under common control with the Borrower within the meaning of Section 4001 of ERISA.

     “Confidential Information Memorandum” shall mean the confidential information
memorandum distributed to the Lenders, dated December 2006.

     “Consolidated Interest Expense” shall mean, for any period of determination
thereof, the interest expense of the Borrower and its Subsidiaries for such period, as
determined in accordance with GAAP; provided that (a) all items that are non-cash
items in the period when recognized and (b) all non-recurring or extraordinary items in any
fiscal period, including without limitation all costs, expenses and premiums arising out of
the Refinancing, shall be excluded for the purpose of determining Consolidated Interest
Expense for any period.

     “Consolidated Net Income” shall mean, for any period of determination thereof,
net income of the Borrower and its Subsidiaries for such period, as determined in accordance
with GAAP.

     “Consolidated Net Worth” shall mean, in respect of any Person at a particular
date, all amounts which, in conformity with GAAP, would be included under the caption “total
shareholders’ equity” (or any like caption) on a consolidated balance sheet of such Person
and its Subsidiaries at such date.

     “Consolidated Total Assets” shall mean, at any date, all amounts that would, in
conformity with GAAP, be set forth opposite the caption “total assets” (or any like caption)
on a consolidated balance sheet of the Borrower and its Subsidiaries at such date.

     “Contingent Obligation” shall mean as to any Person, the outstanding amount of
letters of credit (other than the Letters of Credit) with respect to which such Person is
the account party that have not been drawn upon and any obligation of such Person
guaranteeing or in effect guaranteeing any Indebtedness, leases, dividends or other
obligations primarily to pay money (“primary obligations”) of any other Person (the “primary
obligor”) in any manner, whether directly or indirectly, including, without limitation, any
obligation of such Person, whether or not contingent, (a) to purchase any such primary
obligation or any property constituting direct or indirect security therefor, (b) to advance
or supply funds (i) for the purchase or payment of any such primary obligation or (ii) to
maintain working capital or equity capital of the primary obligor or otherwise to maintain
the net worth or solvency of the primary obligor, (c) to purchase property, securities or
services primarily for the purpose of assuring the obligee under any such primary obligation
of the ability of the primary obligor to make payment of such primary obligation or (d)
otherwise to assure or hold harmless the obligee under such primary obligation against loss
in respect thereof; provided, however, that the term Contingent Obligation
shall not include endorsements of instruments for deposit or collection in the ordinary
course of business.

 

8

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

     “Control Group” shall mean the Hagedorn Partnership, L.P., the general partners
of the Hagedorn Partnership, L.P. and, in the case of such individuals, their respective
executors, administrators and heirs and their families and trusts for their benefit.

     “Default” shall mean any of the events specified in Section 8, whether or not
any requirement for the giving of notice, the lapse of time, or both, or any other
condition, has been satisfied.

     “Disposition” shall mean with respect to any property, any sale, lease, sale
and leaseback, assignment, conveyance, transfer or other disposition thereof;
provided that any such sale, lease, sale and leaseback, assignment, conveyance,
transfer or other disposition of property to, in, by or between the Borrower and any
Subsidiary or between any two or more Subsidiaries shall not constitute a “Disposition”
unless the same is made by the Borrower or any Subsidiary Guarantor to a Foreign Subsidiary.
The terms “Dispose” and “Disposed of” shall have correlative meanings.

     “Dollar Equivalent” shall mean, on any Business Day with respect to any amount
denominated in euros or any other currency, the amount of Dollars that would be required to
purchase such amount of euros or such other currency, as the case may be, based upon the
spot selling rate at which JPMCB London offers to sell each for Dollars in the London
foreign exchange market at approximately 11:00 a.m. London time on such Business Day for
delivery two Business Days later.

     “Dollars” and “$” shall mean dollars in lawful currency of the United
States of America.

     “Domestic Assets” shall mean the assets of the Borrower and any Domestic
Subsidiary, wherever located, and the assets of any Foreign Subsidiary located or domiciled
in any jurisdiction within the United States.

     “Domestic Subsidiary” shall mean any Subsidiary incorporated under the laws of
the United States or any political subdivision thereof.

     “Domestic Subsidiary Borrower” shall mean any Domestic Subsidiary which (a) is
a Subsidiary Borrower hereunder on the Closing Date or (b) which is designated by the
Borrower to be a Subsidiary Borrower pursuant to subsection 10.1(b).

     “EBITDA” shall mean without duplication, for any fiscal period, the sum of the
amounts for such fiscal period of (i) Consolidated Net Income, (ii) provision for taxes
based on income, (iii) depreciation expense, (iv) interest expense that was deducted in the
calculation of Consolidated Net Income, (v) amortization expense, (vi) expenses incurred
prior to June 30, 2007 in an aggregate amount not to exceed $25,000,000 in connection with
the Transactions and (vii) other non-recurring, non-cash items reducing Consolidated Net
Income (reduced by any non-recurring, non-cash items increasing Consolidated Net Income),
all as determined on a consolidated basis for the Borrower and its Subsidiaries in
conformity with GAAP.

     “Effective Interbank Rate” shall have the meaning specified in subsection
2.18(d).

 

9

     “Eligible Australian Bank” shall mean (a) a resident of Australia which does
not make Australian Dollar Loans as part of carrying on business outside of Australia at or
through a permanent establishment outside of Australia; or (b) a non-resident of Australia
which makes Swing Line Loans or Revolving Credit Loans as part of carrying on business in
Australia at or through a permanent establishment of the non-resident in Australia. In this
definition, words and expressions used shall have the meaning ascribed to them for the
purposes of S. 128B of the Australian Income Tax Assessment Act of 1936.

     “Eligible Canadian Bank” shall mean (a) those banks listed on Schedules I, II
or III to the Bank Act (Canada), (b) any (i) trust company, savings bank, savings
and loan association or similar financial institution, or (ii) insurance company engaged in
the business of writing insurance which, in either case (A) has total assets of
$10,000,000,000 or more, (B) is engaged in the business of lending money and extending
credit under credit facilities substantially similar to those extended under this Agreement,
(C) is operationally and procedurally able to meet the obligations of a Lender hereunder to
the same degree as a commercial bank, and (c) any other financial institution (including a
mutual fund or other fund) having total assets of $10,000,000,000 or more which meets the
requirements set forth in subclauses (B) and (C) of clause (b) above; provided that
each Eligible Canadian Bank must be organized under the laws of either Canada or a political
subdivision thereof or, if not, it must (i) act hereunder through a branch, agency or
funding office located in Canada and (ii) be exempt from withholding of tax on interest
payments.

     “Eligible U.K. Bank” shall mean a Person that is both (i) a bank as defined in
Section 840A of the United Kingdom Income and Corporation Taxes Act 1988, and (ii) a Person
within the charge to United Kingdom corporation tax (i.e., a United Kingdom resident company
or a non-resident company which is carrying on a trade in the United Kingdom through a
permanent establishment in the United Kingdom to which the beneficial interest in interest
accrued under Loans made to the Borrower or a Subsidiary Borrower is attributable and which
is not entitled to exemption from tax in respect of that interest).

     “Environmental Laws” shall mean any and all foreign, Federal, state, local or
municipal laws, rules, orders, regulations, statutes, ordinances, codes, decrees,
requirements of any Governmental Authority or requirements of law (including common law)
regulating, relating to or imposing liability or standards of conduct concerning protection
of human health or the environment, as now or may at any time hereafter be in effect.

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

     “euro” and “€” shall mean the single currency of Participating
Member States.

     “Event of Default” shall mean any of the events specified in Section 8,
provided that any requirement for the giving of notice, the lapse of time, or both, or any
other condition, has been satisfied.

     “Excluded Foreign Subsidiary” shall mean any Foreign Subsidiary a guarantee
from which, a pledge of the assets of which, or the pledge of 66 2/3% or more of the Capital
Stock of which under the applicable Security Document would have adverse tax consequences on
the Borrower, any of its Subsidiaries or such Foreign Subsidiary or would reasonably be
deemed an unlawful act of such Foreign Subsidiary or any of its officers or directors under
the laws of the applicable foreign jurisdiction.

 

10

     “Excluded Prepayment Property” shall mean any (i) property which is Disposed of
pursuant to subsection 7.8(b) or Section 7.9 (ii) inventory or obsolete or worn-out property
Disposed of in the ordinary course of business or (iii) any property Disposed by a Domestic
Subsidiary to a Foreign Subsidiary.

     “Excluded Taxes” shall have the meaning set forth in subsection 2.22(a).

     “Existing Credit Agreement” shall have the meaning assigned to such term in the
recitals hereto.

     “Existing Senior Subordinated Note Indenture” shall mean the Indenture entered
into by the Borrower on October 8, 2003 together with all instruments and other agreements
entered into by the Borrower and its Subsidiaries in connection therewith, as the same may
be amended, supplemented or otherwise modified from time to time in accordance with
subsection 7.11.

     “Existing Senior Subordinated Notes” shall mean the Borrower’s existing
$200,000,000 aggregate principal amount of 6.625% senior subordinated notes issued under the
Existing Senior Subordinated Note Indenture.

     “Extension of Credit” shall mean (i) all Loans or advances made to the Borrower
and the Subsidiary Borrowers hereunder and (ii) all Letters of Credit issued for the account
of the Borrower and the Subsidiary Borrowers and any unreimbursed drawings hereunder.

     “Facility” shall mean the Term Facility or any Revolving Facility.

     “Facility A-1 Commitment” shall mean, as to each Facility A-1 Lender, the
obligation of such Lender, if any, to make Facility A-1 Loans and participate in Swing Line
Loans or Letters of Credit made under the Facility A-1 Commitments in an aggregate principal
and/or face amount not to exceed the amount set forth under the heading “Facility A-1
Commitment” opposite such Facility A-1 Lender’s name on Schedule 1 or in the Assignment and
Acceptance pursuant to which such Facility A-1 Lender became a party hereto, as the same may
be changed from time to time pursuant to the terms hereof. The original amount of the
Facility A-1 Commitments is $1,155,000,000.

     “Facility A-1 Lenders” shall mean each Lender that has a Facility A-1
Commitment or that holds Facility A-1 Loans; collectively, the “Facility A-1
Lenders”.

     “Facility A-1 Loan” shall mean any Loan made under the Facility A-1 Commitments
pursuant to subsection 2.4; collectively, the “Facility A-1 Loans”.

     “Facility A-2 Commitment” shall mean, as to each Facility A-2 Lender, the
obligation of such Lender, if any, to make Facility A-2 Loans and participate in Swing Line
Loans or Letters of Credit made under the Facility A-2 Commitments in an aggregate principal
and/or face amount not to exceed the amount set forth under the heading “Facility A-2
Commitment” opposite such Facility A-2 Lender’s name on Schedule 1 or in the Assignment and
Acceptance pursuant to which such Facility A-2 Lender became a party hereto, as the same may
be changed from time to time pursuant to the terms hereof. The original amount of the
Facility A-2 Commitments is $75,000,000.

     “Facility A-2 Lenders” shall mean each Lender that has a Facility A-2
Commitment or that holds Facility A-2 Loans; collectively, the “Facility A-2
Lenders”.

 

11

     “Facility A-2 Loan” shall mean any Loan made under the Facility A-2 Commitments
pursuant to subsection 2.4; collectively, the “Facility A-2 Loans”.

     “Facility B Commitment” shall mean, as to each Facility B Lender, the
obligation of such Lender, if any, to make Facility B Loans and participate in Swing Line
Loans and Letters of Credit issued under the Facility B Commitments in an aggregate
principal and/or face amount not to exceed the amount set forth under the heading “Facility
B Commitment” opposite such Facility B Lender’s name on Schedule 1 or in the Assignment and
Acceptance pursuant to which such Facility B Lender became a party hereto, as the same may
be changed from time to time pursuant to the terms hereof. The original amount of the
Facility B Commitments is $300,000,000.

     “Facility B Lender” shall mean each Lender that has a Facility B Commitment or
that holds Facility B Loans; collectively, the “Facility B Lenders”.

     “Facility B Loan” shall mean any Loan made under the Facility B Commitments
pursuant to subsection 2.4; collectively, the “Facility B Loans”.

     “Facility C Commitment” shall mean, as to each Facility C Lender, the
obligation of such Lender, if any, to make Facility C Loans and participate in Swing Line
Loans and Letters of Credit issued under the Facility C Commitments in an aggregate
principal and/or face amount not to exceed the amount set forth under the heading “Facility
C Commitment” opposite such Facility C Lender’s name on Schedule 1 or in the Assignment and
Acceptance pursuant to which such Lender became a party hereto, as the same may be changed
from time to time pursuant to the terms hereof. The original amount of the Facility C
Commitments is $25,000,000.

     “Facility C Lender” shall mean each Lender that has a Facility C Commitment or
that holds Facility C Loans; collectively, the “Facility C Lenders”.

     “Facility C Loan” shall mean any Loan made under the Facility C Commitments
pursuant to subsection 2.4; collectively, the “Facility C Loans”.

     “Facility D Commitment” shall mean, as to each Facility D Lender, the
obligation of such Lender, if any, to make Facility D Loans and participate in Swing Line
Loans and Letters of Credit issued under the Facility D Commitments in an aggregate
principal and/or face amount not to exceed the amount set forth under the heading “Facility
D Commitment” opposite such Facility D Lender’s name on Schedule 1 or in the Assignment and
Acceptance pursuant to which such Lender became a party hereto, as the same may be changed
from time to time pursuant to the terms hereof. The original amount of the Facility D
Commitments is $35,000,000.

     “Facility D Lender” shall mean each Lender that has a Facility D Commitment or
that holds Facility D Loans; collectively, the “Facility D Lenders”.

     “Facility D Loan” shall mean any Loan made under the Facility D Commitments
pursuant to subsection 2.4; collectively, the “Facility D Loans”.

     “Foreign Pledge Agreement Acknowledgment and Confirmation” shall mean the
Foreign Pledge Agreement Acknowledgment and Confirmation and Supplement, substantially in
the form of Exhibit F hereto, among the Borrower and certain of its Subsidiaries which are
parties to Foreign Pledge Agreements which are in effect as of the Closing Date and the
Administrative Agent, for the benefit of the Lenders, as the same may be amended,
supplemented or otherwise modified from time to time.

 

12

     “Foreign Pledge Agreements” shall mean each pledge agreement, charge or
collateral security instrument creating a security interest in the Capital Stock of the
Foreign Subsidiary Borrowers (other than Scotts Treasury EEIG) and certain other Foreign
Subsidiaries of the Borrower, in each case, in form and substance reasonably satisfactory to
the Administrative Agent, as such agreements may be amended, supplemented or otherwise
modified from time to time.

     “Foreign Subsidiary” shall mean any Subsidiary of the Borrower which is
organized under the laws of any jurisdiction outside of the United States of America.

     “Foreign Subsidiary Borrower” shall mean any Sterling Subsidiary Borrower,
Australian Subsidiary Borrower or Canadian Subsidiary Borrower (a) which is a Subsidiary
Borrower hereunder on the Closing Date or (b) which is designated by the Borrower pursuant
to subsection 10.1(b).

     “Full Security Period” shall have the meaning specified in the Guarantee and
Collateral Agreement.

     “Funded Debt” shall mean, as to any Person, all Indebtedness of such Person
that matures more than one year from the date of its creation or matures within one year
from such date but is renewable or extendible, at the option of such Person, to a date more
than one year from such date or arises under a revolving credit or similar agreement that
obligates the lender or lenders to extend credit during a period of more than one year from
such date, including all current maturities and current sinking fund payments in respect of
such Indebtedness whether or not required to be paid within one year from the date of its
creation and, in the case of the Borrower and the Subsidiary Borrowers, Indebtedness in
respect of the Loans.

     “GAAP” shall mean generally accepted accounting principles in the United States
of America as in effect from time to time; provided, however, that if any
modifications in GAAP after the Closing Date change any calculation of any financial
covenants under this Agreement, the Administrative Agent and the Lenders agree to amend this
Agreement to the effect that each such financial covenant is no more restrictive than such
covenant was prior to such modification in GAAP (and until such agreement, such covenants
shall be calculated in accordance with GAAP before such modification).

     “Governmental Authority” shall mean any nation or government, any state or
other political subdivision thereof and any entity exercising executive, legislative,
judicial, regulatory or administrative functions of or pertaining to government (including
the National Association of Insurance Commissioners).

     “Guarantee and Collateral Agreement” shall mean the Amended and Restated
Guarantee and Collateral Agreement among the Borrower, the Domestic Subsidiary Borrowers,
the Subsidiary Guarantors and the Administrative Agent, for the benefit of the Lenders,
substantially in the form of Exhibit B, as amended, supplemented or otherwise modified from
time to time.

     “Hedging Agreements” shall mean (a) any interest rate protection agreement,
interest rate future, interest rate option, interest rate swap, interest rate cap, interest
rate exchange (from fixed to floating rates, from one floating rate to another floating rate
or otherwise) or other interest rate hedge or arrangement under which the Borrower is a
party or a beneficiary and (b) any agreement or arrangement designed to limit or eliminate
the risk and/or exposure of the Borrower to fluctuations in currency exchange rates or in
commodity prices.

 

13

     “Hedging Lender” shall mean any Lender or affiliate thereof which from time to
time enters into a Hedging Agreement with the Borrower.

     “Hostile Take-Over Bid” shall mean an offer to purchase a controlling interest
in any Person by the Borrower or any of its Subsidiaries or in which the Borrower or any of
its Subsidiaries is involved, in respect of which the board of directors (or equivalent
governing body for such entity) of the target entity has recommended against acceptance of
such offer to the target entity’s shareholders or equity holders or which is similarly
opposed or contested.

     “Incremental Commitment Supplement” shall have the meaning assigned to such
term in subsection 2.27(a).

     “Incremental Term Loans” shall have the meaning assigned to such term in
subsection 2.27(a).

     “Indebtedness” shall mean, as to any Person, at a particular time, (a)
indebtedness of such Person for borrowed money or for the deferred purchase price of
property or services (including, without limitation, any such indebtedness which is
non-recourse to the credit of such Person but is secured by assets of such Person, but
excluding current amounts payable incurred in the ordinary course of business), (b)
obligations of such Person under leases which shall have been or should be, in accordance
with GAAP, recorded as capitalized leases, (c) indebtedness of such Person arising under
acceptance facilities, (d) indebtedness of such Person arising under unpaid reimbursement
obligations in respect of all drafts drawn under letters of credit issued for the account of
such Person, (e) the incurrence of withdrawal liability under Title IV of ERISA by such
Person or a Commonly Controlled Entity to a Multi-employer Plan, (f) liabilities arising
under Hedging Agreements of such Person and (g) indebtedness of such Person under any
synthetic lease.

     “Insolvency” shall mean, with respect to any Multi-employer Plan, the condition
that such Plan is insolvent within the meaning of such term as used in Section 4245 of
ERISA.

     “Interest Coverage Ratio” shall mean, as at the last day of any fiscal quarter
of the Borrower, the ratio of (a) the sum of EBITDA as of the end of such fiscal quarter for
the preceding twelve months to (b) Consolidated Interest Expense as of the end of such
fiscal quarter for the preceding twelve months.

     “Interest Payment Date” shall mean (a) as to any ABR Loan, the last day of each
March, June, September and December, commencing on the first of such days to occur after
such ABR Loan is made or any LIBOR Loan is converted to such ABR Loan, (b) as to any LIBOR
Loan in respect of which the Borrower or applicable Subsidiary Borrower has selected an
Interest Period of one month, two months or three months, the last day of such Interest
Period and (c) as to any LIBOR Loan in respect of which the Borrower or applicable
Subsidiary Borrower has selected a longer Interest Period than the periods described in
preceding clause (b), the day three months after the commencement of such Interest Period
and the last day of such Interest Period.

     “Interest Period” shall mean with respect to any LIBOR Loan, (i) initially, the
period commencing on, as the case may be, the borrowing or conversion date with respect to a
LIBOR Loan, and ending one, two, three or six months thereafter, as selected by the Borrower
or applicable Subsidiary Borrower, as the case may be, in its irrevocable written notice of
borrowing or irrevocable written notice of conversion, as applicable, and (ii) thereafter,
each period commencing on the last day of the next preceding Interest Period applicable to
such LIBOR Loan

 

14

and ending one, two, three or six months thereafter, as selected by the Borrower or
applicable Subsidiary Borrower by irrevocable written notice to the Administrative Agent not
less than three Business Days prior to the last day of the then current Interest Period with
respect to such Loan; provided that all of the foregoing provisions relating to
Interest Periods are subject to the following:

     (A) if any Interest Period pertaining to a LIBOR Loan would otherwise end on a
day which is not a Business Day, that Interest Period shall be extended to the next
succeeding Business Day unless the result of such extension would be to carry such
Interest Period into another calendar month in which event such Interest Period
shall end on the next preceding Business Day;

     (B) (1) if the Borrower or applicable Subsidiary Borrower shall fail to give
notice as provided in clauses (i) and (ii) in this definition with respect to a
LIBOR Loan denominated in Dollars, the Borrower or applicable Subsidiary Borrower
shall be deemed to have requested conversion of the affected LIBOR Loan to an ABR
Loan on the last day of the then current Interest Period with respect thereto; and
(2) if the Borrower or applicable Subsidiary Borrower shall fail to give notice as
provided in clauses(i) and (ii) in this definition with respect to a Loan
denominated in a currency other than Dollars, the Borrower or applicable Subsidiary
Borrower shall be deemed to have requested a continuation of the affected Loan for a
period commencing on the last day of the next preceding Interest Period applicable
to such Loan and ending one month thereafter;

     (C) any Interest Period that would otherwise extend beyond the applicable
Termination Date shall end on the applicable Termination Date; and

     (D) any Interest Period pertaining to a LIBOR Loan that begins on the last
Business Day of a calendar month (or on day for which there is no numerically
corresponding day in the calendar month at the end of such Interest Period) shall
end on the last Business Day of a calendar month.

     “International Standby Practices” shall mean the International Standby
Practices, International Chamber of Commerce Publication No. ISP98, as the same may be
effectively replaced in whole or in part or amended from time to time.

     “Issuing Lender” shall mean, in respect of any Letter of Credit, JPMCB or, at
the option of JPMCB, any affiliate of JPMCB, or with the consent of the Borrower and the
Administrative Agent, any other Lender, in each case in its capacity as the issuer of such
Letter of Credit.

     “JPMCB” shall have the meaning assigned to such term in the preamble hereto.

     “L/C Commitment” shall mean the amount of $65,000,000.

     “L/C Obligations” shall mean, at any time, an amount equal to the sum of (a)
the aggregate then undrawn and unexpired amount of the then outstanding Letters of Credit
and (b) the aggregate amount of drawings under Letters of Credit which have not then been
reimbursed pursuant to Section 3.

     “L/C Participants” shall mean, with respect to any Revolving Facility under
which a Letter of Credit is issued, the collective reference to all the Revolving Credit
Lenders under such Revolving Facility other than the Issuing Lender.

 

15

     “Lending Installation” shall mean, with respect to a Lender, the office,
branch, subsidiary or affiliate of such Lender listed on the signature pages hereof or on a
Schedule or otherwise selected by such Lender pursuant to subsection 2.25.

     “Letter of Credit” shall mean any Standby L/C or Trade L/C.

     “Lender Cash Management Agreements” shall mean all agreements providing for
treasury, depositary or cash management services, including in connection with any automated
clearing house transfers of funds or any similar transactions between the Borrower or any
Subsidiary Borrower and any Lender (or any Affiliate of any Lender), which has been
designated by such Lender and the Borrower, by notice to the Administrative Agent, as a
“Lender Cash Management Agreement.”

     “Lender Hedging Agreements” shall mean all Hedging Agreements entered into by
the Borrower with a Hedging Lender.

     “Lenders” shall have the meaning assigned to such term in the preamble hereto.
As the context shall require, a Lender shall include any of its affiliates that is a
Sterling Lender, an Australian Dollar Lender or a Canadian Dollar Lender.

     “Leverage Ratio” shall mean, as at the last day of any fiscal quarter of the
Borrower, the ratio of (i) Average Total Indebtedness of the Borrower and its Subsidiaries
on such day to (ii) EBITDA for the four consecutive fiscal quarters ending on such day;
provided Total Indebtedness as at the last day of the fiscal quarters ending March
31, 2007, June 30, 2007 and September 30, 2007 shall be increased by amounts equal to 75%,
50% and 25% of the Repurchase Amount, respectively; provided further that
any calculation of the above ratio following any acquisition made during the twelve-month
period covered by such calculation, by purchase or otherwise, of all or substantially all of
the business or assets of, any Person or of any line of business of any Person shall be
determined on a pro forma basis without duplication, including (y) in
Average Total Indebtedness and in the amount of preferred stock accruals, an annualization
of the actual indebtedness or preferred stock accruals relating to such acquisition for the
portion of such twelve-month period prior to the date of such acquisition (or, if such
acquisition occurred on the last day of a fiscal quarter, an annualization estimate of the
daily indebtedness or preferred stock accruals relating to such acquisition based on the
indebtedness incurred and based on the current Interest Rates for such indebtedness or
preferred stock issued on such date) and (z) in EBITDA the EBITDA of the acquired Person for
any portion of such twelve-month period prior to such acquisition. Notwithstanding the
foregoing, for purposes of determining the Applicable Margin, the Leverage Ratio shall (a)
until the earlier to occur of (i) the consummation of the Repurchase and (ii) the date which
is 30 days after the Closing Date, be deemed to be less than 3.00 to 1.00 and greater than
2.25 to 1.00 and (b) thereafter, until the first Adjustment Date, be recomputed as at the
last day of the most recently ended fiscal quarter of the Borrower as if the Transactions
(it being understood that the amount of the Repurchase shall be the Repurchase Amount) had
occurred on the first day of the four consecutive fiscal quarter period ending on such day.

     “LIBOR Base Rate” shall mean, with respect to any LIBOR Loan in Dollars, euros
or any Optional Currency for any Interest Period therefor:

     (a) the rate per annum (rounded to the nearest 1/16 of 1%) appearing on the
Screen for such currency as the London Interbank Offered Rate for deposits in such
currency at approximately 11:00 a.m. London time (or as soon thereafter as
practicable) on (in the case of any LIBOR Loan in Sterling), or two Business Days
prior to (in the

 

16

case of any LIBOR Loan in Dollars, euros or any other Optional Currency), the
first day of such Interest Period as the London Interbank Offered Rate for such
currency having a term comparable to such Interest Period; or

     (b) if such rate does not appear on the Screen (or, if the Screen shall cease
to be publicly available or if the information contained on the Screen, in the
Administrative Agent’s reasonable judgment, shall cease accurately to reflect such
LIBOR Base Rate, as reported by any publicly available source of similar market data
selected by the Administrative Agent that, in the Administrative Agent’s reasonable
judgment, accurately reflects such LIBOR Base Rate), the LIBOR Base Rate shall mean,
with respect to any LIBOR Loan for any Interest Period, the arithmetic mean, as
determined by the Administrative Agent, of the rate per annum (rounded to the
nearest 1/16 of 1%) quoted by each relevant Reference Lender at approximately 11:00
a.m. London time (or as soon thereafter as practicable) on (in the case of any LIBOR
Loan in Sterling), or two Business Days prior to (in the case of any LIBOR Loan in
Dollars, euros or any other Optional Currency), the first day of the Interest Period
for such Loan for the offering by such Reference Lender to leading banks in the
London interbank market of deposits in such currency having a term comparable to
such Interest Period and in an amount comparable to the principal amount of the
LIBOR Loan to be made by such Reference Lender (or its relevant applicable Lending
Installation, as the case may be) for such Interest Period.

     “LIBOR Loans” shall mean the Loans hereunder at such time as they are made
and/or being maintained at a rate of interest based upon the applicable LIBOR Rate.

     “LIBOR Rate” shall mean (a) with respect to a LIBOR Loan denominated in
Dollars, euros or any Optional Currency for each day during each Interest Period pertaining
thereto, the rate per annum equal to the LIBOR Base Rate or, to the extent such reserve
requirements are generally applicable with respect to loans to the relevant Borrower or
Subsidiary Borrower, the quotient (rounded upward to the nearest 1/100 of 1%) of (A) the
LIBOR Base Rate, divided by (B) a number equal to 1.00 minus the aggregate of the
rates (expressed as a decimal fraction) of reserve requirements current on such day
(including, without limitation, basic, supplemental, marginal and emergency reserves under
any regulations of the Board of Governors of the Federal Reserve System or other
Governmental Authority having jurisdiction with respect thereto), as now and from time to
time hereafter in effect, dealing with reserve requirements prescribed for eurocurrency
funding (currently referred to as “Eurocurrency liabilities” in Regulation D of such Board)
maintained by a member of such System or (b) to the extent applicable with respect to a
LIBOR Loan denominated in Sterling for each day during each Interest Period pertaining
thereto, the sum of the LIBOR Base Rate plus, to the extent generally applicable to
loans to the relevant Borrower or Subsidiary Borrower, the Financial Services Authority
charges for such day.

     “Lien” shall mean any mortgage, deed of trust, pledge, hypothecation,
assignment, deposit arrangement, charge, encumbrance, lien (statutory or other), or
preference, priority or other security agreement or preferential arrangement of any kind or
nature whatsoever (including, without limitation, any conditional sale or other title
retention agreement, any financing lease having substantially the same economic effect as
any of the foregoing, and the authorized filing by or against a Person of any financing
statement as debtor under the Uniform Commercial Code or comparable law of any
jurisdiction).

     “Loan” shall mean any Term Loan, Revolving Credit Loan or Swing Line Loan, as
the context shall require; collectively, the “Loans”.

 

17

     “Loan Documents” shall mean, collectively, this Agreement, any Notes, the
Applications, the Letters of Credit and the Security Documents.

     “Loan Parties” shall mean the Borrower, each Subsidiary Borrower and each other
Subsidiary of the Borrower which is a party to any Loan Document.

     “Material Adverse Effect” shall mean a material adverse effect on (a) the
business, operations, property or financial condition of the Borrower and its Subsidiaries
taken as a whole or (b) the validity or enforceability of any material term of this
Agreement or any of the other Loan Documents or the rights or remedies of the Administrative
Agent or the Lenders hereunder or thereunder.

     “Material Environmental Amount” shall mean (a) an amount payable by the
Borrower or any of its Subsidiaries for investigative and remedial costs, compliance costs,
compensatory damages, natural resource damages, punitive damages, fines, and penalties, in
the aggregate, that exceeds $20,000,000 (net of insurance), or (b) any other impact on the
Borrower or any of its Subsidiaries arising out of any of the Environmental Laws which, in
the aggregate, could reasonably be anticipated to exceed $20,000,000 (net of insurance).

     “Material Subsidiary” shall mean at any time (a) any Subsidiary Borrower, (b)
any Subsidiary of the Borrower created or acquired after the Closing Date which has a Total
Capitalization of more than $30,000,000, (c) any Subsidiary of the Borrower with assets
greater than or equal to 5% of all assets of the Borrower and its Subsidiaries, computed and
consolidated in accordance with GAAP (“Consolidated Assets”), (d) any Subsidiary
with revenues greater than or equal to 5% of the revenues of the Borrower and its
Subsidiaries, computed and consolidated in accordance with GAAP (“Net Revenues”) or
(e) any Subsidiary designated in writing by the Borrower as a Material Subsidiary, which
designation shall be irrevocable; provided that if at any time (i) the aggregate
Total Capitalization of all Subsidiaries that are not Material Subsidiaries shall exceed 10%
of the Total Capitalization of the Borrower and its Subsidiaries, computed and consolidated
in accordance with GAAP, (ii) the aggregate assets of all Subsidiaries that are not Material
Subsidiaries shall exceed 10% of Consolidated Assets or (iii) the aggregate revenues of all
Subsidiaries that are not Material Subsidiaries shall exceed 10% of Net Revenues, then, in
any such case, the term Material Subsidiary shall be deemed to include such Subsidiaries (as
determined pursuant to the next following sentence) of the Borrower as may be required so
that none of preceding clauses (i), (ii) or (iii) shall continue to be true. For purposes
of the proviso to the next preceding sentence, the Subsidiaries which shall be deemed to be
Material Subsidiaries shall be determined based on the percentage that the assets of each
such Subsidiary are of Consolidated Assets, with the Subsidiary with the highest such
percentage being selected first, and each other Subsidiary required to satisfy the
requirements set forth in such proviso being selected in descending order of such respective
percentages.

     “Materials of Environmental Concern” shall mean any gasoline or petroleum
(including crude oil or any fraction thereof) or petroleum products or any hazardous or
toxic substances, materials or wastes, defined or regulated as such in or under any
Environmental Law, including, without limitation, asbestos, polychlorinated biphenyls, and
urea-formaldehyde insulation; and any other substance that could give rise to liability
under any Environmental Law.

     “Maturity Date” shall mean the date which is the five-year anniversary of the
date hereof.

     “Moody’s” shall mean Moody’s Investors Service, Inc.

 

18

     “Multi-employer Plan” shall mean a Plan which is a multi-employer plan as
defined in Section 4001(a)(3) of ERISA.

     “Net Cash Proceeds” shall mean (a) in connection with any Asset Sale or any
Recovery Event, the proceeds thereof in the form of cash and Cash Equivalents (including any
such proceeds received by way of deferred payment of principal pursuant to a note or
installment receivable or purchase price adjustment receivable or otherwise, but only as and
when received) of such Asset Sale or Recovery Event, net of attorneys’ fees, accountants’
fees, investment banking fees, amounts required to be applied to the repayment of
Indebtedness secured by a Lien expressly permitted hereunder on any asset that is the
subject of such Asset Sale or Recovery Event (other than any Lien pursuant to a Security
Document) and other customary fees and expenses actually incurred in connection therewith
and net of taxes paid or reasonably estimated to be payable as a result thereof (after
taking into account any available tax credits or deductions and any tax sharing
arrangements) and (b) in connection with any issuance or sale of debt securities or
instruments or the incurrence of loans, the cash proceeds received from such issuance or
incurrence, net of attorneys’ fees, investment banking fees, accountants’ fees, underwriting
discounts and commissions and other customary fees and expenses actually incurred in
connection therewith.

     “New Lender” shall have the meaning set forth in subsection 2.27(a).

     “Non-Dollar Currency Equivalent” shall mean, on any Business Day with respect
to any amount in Dollars, the amount of euros or the relevant Optional Currency that could
be purchased with such amount of Dollars using the foreign exchange rate for such Business
Day specified in the definition of “Dollar Equivalent”.

     “Non-Excluded Taxes” shall have the meaning set forth in subsection 2.22.

     “Note” shall have the meaning set forth in subsection 10.6(e).

     “Obligations” shall mean the unpaid principal of and interest on (including,
without limitation, interest accruing after the maturity of the Loans and interest thereon
accruing after the filing of any petition in bankruptcy, or the commencement of any
insolvency, reorganization or like proceeding, relating to the Borrower or any Subsidiary
Borrower, whether or not a claim for post-filing or post-petition interest is allowed in
such proceeding) and all other obligations and liabilities of the Borrower or any Subsidiary
Borrower to the Administrative Agent or the Lenders (or, in the case of Lender Hedging
Agreements or Lender Cash Management Agreements, any Affiliate of a Lender), whether direct
or indirect, absolute or contingent, due or to become due, now existing or hereafter
incurred, which may arise under, out of, or in connection with, this Agreement, the other
Loan Documents, any Lender Hedging Agreement or Lender Cash Management Agreement thereof or
any other document made, delivered or given in connection herewith or therewith, whether on
account of principal, interest, reimbursement obligations, fees, indemnities, costs,
expenses (including, without limitation, all fees and disbursements of counsel to the
Administrative Agent or any Lender) or otherwise.

     “Optional Currency” shall mean euros and any other freely tradable currency
readily available in the London interbank market and approved by the Administrative Agent.

     “Participants” shall mean one or more banks or other entities to which one or
more Lenders have sold, in the ordinary course of business and in accordance with applicable
law,

 

19

participating interests in any Loan, Note, Revolving Credit Commitment or Term Loan
Commitment or any other interest hereunder owing to such Lender.

     “Participating Member State” shall mean a member state of the European
Communities that adopts or has adopted the euro as its lawful currency in accordance with
legislation of the European Community relating to Economic and Monetary Union.

     “PBGC” shall mean the Pension Benefit Guaranty Corporation established pursuant
to Subtitle A of Title IV of ERISA.

     “Permitted Acquisition” shall mean any acquisition of all or substantially all
the assets of, or shares or other equity interests in, a Person or division or line of
business of a Person or other significant assets of a Person (other than inventory, leases,
materials and equipment and other assets in the ordinary course of business) if immediately
after giving effect thereto: (i) no Default or Event of Default shall have occurred and be
continuing or would result therefrom, (ii) such acquired subsidiary or newly formed
subsidiary owning the acquired assets shall be a Subsidiary of the Borrower or a
wholly-owned Subsidiary and all actions required to be taken, if any, with respect to such
acquired or newly formed subsidiary under subsection 6.11 shall have been taken or shall be
planned to be taken in a manner reasonably satisfactory to the Administrative Agent, (iii)
no Material Adverse Effect would be likely to result therefrom and (iv)(I) the Borrower
shall be in compliance, on a pro forma basis after giving effect to such
acquisition or formation, with the covenants contained in subsections 6.9 and 6.10
recomputed as at the last day of the most recently ended fiscal quarter of the Borrower as
if such acquisition had occurred on the first day of each relevant period for testing such
compliance and any savings associated with such acquisition had been achieved on the first
day of such relevant period, and, in the case of an acquisition involving consideration in
excess of $20,000,000, the Borrower shall have delivered to the Administrative Agent an
officers’ certificate to such effect, together with all relevant financial information for
such subsidiary or assets (to the extent reasonably available), and (II) after giving effect
to such transaction, any acquired or newly formed subsidiary shall not be liable for any
Indebtedness (except for Indebtedness permitted by subsection 7.5).

     “Permitted Foreign Debt” shall have the meaning specified in subsection 7.5(j).

     “Person” shall mean an individual, a partnership, a corporation, a limited
liability company, a business trust, a joint stock company, a trust, an unincorporated
association, a joint venture, a Governmental Authority or any other entity of whatever
nature.

     “Plan” shall mean, at any particular time, any employee benefit plan which is
covered by ERISA and in respect of which the Borrower or a Commonly Controlled Entity is (or
if such plan were terminated at such time, would under Section 4069 of ERISA be deemed to
be) an “employer” as defined in Section 3(5) of ERISA.

     “Pricing Grid” shall mean the pricing grid attached hereto as Annex A.

     “Receivable” shall mean any account and any other right to payment for goods
sold or leased or for services rendered, whether or not such right is evidenced by an
instrument or chattel paper and whether or not it has been earned by performance. The terms
“account”, “instrument” and “chattel paper” as used herein shall have the meaning assigned
to such terms in the Uniform Commercial Code in effect from time to time in the State of New
York.

 

20

     “Receivables Subsidiary” shall mean a Subsidiary of the Borrower created to
purchase and finance Sold Receivables.

     “Receivables Purchase Facility” shall mean any receivables purchase facility
with terms and conditions reasonably satisfactory to the Administrative Agent and pursuant
to which ownership interests in, or notes, commercial paper, certificates or other debt
instruments in respect of which, are secured by Sold Receivables.

     “Recovery Event” shall mean any settlement of or payment in respect of any
property or casualty insurance claim or any condemnation proceeding relating to any asset of
the Borrower or any of its Subsidiaries (other than Excluded Prepayment Property) (valued at
the initial principal amount thereof in the case of non-cash proceeds consisting of notes or
other debt securities and valued at fair market value in the case of other non-cash
proceeds) in excess of $10,000,000.

     “Reference Lenders” shall mean JPMCB, Citicorp North America, Inc. and Bank of
America, N.A.

     “Refinancing” shall mean the refinancing of the amounts outstanding under the
Existing Credit Agreement and the redemption of all or any portion of the Existing Senior
Subordinated Notes with the proceeds of Loans.

     “Refunded Swing Line Loans” shall have the meaning assigned to such term in
subsection 2.6(b).

     “Register” shall have the meaning specified in subsection 10.6(b)(iv).

     “Regular Subsidiary Borrower” shall mean Scotts Treasury EEIG, any Domestic
Subsidiary Borrower, any Foreign Subsidiary Borrower which is designated by the Borrower as
a “Regular Subsidiary Borrower” in a notice to the Administrative Agent (which shall notify
each Revolving Credit Lender of such designation), and any Foreign Subsidiary designated by
the Borrower as a Regular Subsidiary Borrower after the Closing Date pursuant to subsection
10.1(b); provided that so long as any such Foreign Subsidiary Borrower is so
designated, it is not required under the laws or regulations of any Governmental Authority
to deduct or withhold any Non-Excluded Taxes from any payment made by it under Section 2 or
otherwise pursuant to this Agreement. The Borrower may rescind any such designation at any
time by notice to the Administrative Agent, which shall notify each Revolving Credit Lender
of such rescission.

     “Reimbursement Obligation” shall mean the Borrower’s obligation to reimburse
the Administrative Agent or any other Issuing Lender on account of the Letters of Credit as
provided in Section 3.

     “Reinvestment Deferred Amount” shall mean with respect to any Reinvestment
Event, the aggregate Net Cash Proceeds received by the Borrower or any of its Subsidiaries
in connection therewith that are not applied to prepay the Term Loan pursuant to subsection
2.12(c) as a result of the delivery of a Reinvestment Notice.

     “Reinvestment Event” shall mean any Asset Sale (other than the sale, transfer
or discount of Sold Receivables pursuant to any Receivables Purchase Facility) or Recovery
Event in respect of which the Borrower has delivered a Reinvestment Notice.

 

21

     “Reinvestment Notice” shall mean a written notice executed by a Responsible
Officer stating that no Event of Default has occurred and is continuing and that the
Borrower (directly or indirectly through a Subsidiary) intends and expects to use all or a
specified portion of the Net Cash Proceeds of an Asset Sale (other than the sale, transfer
or discount of Sold Receivables pursuant to any Receivables Purchase Facility) or Recovery
Event to acquire assets useful in its business.

     “Reinvestment Prepayment Amount” shall mean with respect to any Reinvestment
Event, the (x) Reinvestment Deferred Amount relating thereto less (y) any amount thereof
expended prior to the relevant Reinvestment Prepayment Date (i) to acquire assets useful in
the Borrower’s business or (ii) to pay the Borrower’s reasonable expenses relating to any
proposed acquisition of assets useful in such business.

     “Reinvestment Prepayment Date” shall mean with respect to any Reinvestment
Event, the earlier of (i) the date occurring 12 months after such Reinvestment Event and
(ii) the date on which the Borrower shall have notified the Administrative Agent that it has
determined not to, or shall have otherwise ceased to, acquire assets useful in the
Borrower’s business with all or any portion of the relevant Reinvestment Deferred Amount.

     “Reorganization” shall mean, with respect to any Multi-employer Plan, the
condition that such Plan is in reorganization within the meaning of such term as used in
Section 4241 of ERISA.

     “Reportable Event” shall mean any of the events set forth in Section 4043(b) of
ERISA or the regulations thereunder (with respect to which the PBGC has not, by regulation,
waived the 30-day notice requirement).

     “Repurchase” shall have the meaning assigned to such term in subsection
7.14(c).

     “Repurchase Amount” shall mean $750,000,000 or such lesser amount as may be
certified at any time to the Administrative Agent by a Responsible Officer of the Borrower
as the amount determined by the Board of Directors of the Borrower to be the final amount of
the Repurchase.

     “Required Lenders” shall mean at any time, the holders of more than 50% of the
sum of (i)(A) the Term Commitments then in effect and (B) the aggregate unpaid principal
amount of the Term Loan then outstanding and (ii) the Total Revolving Credit Commitments
then in effect or, if the Revolving Credit Commitments have been terminated, the Aggregate
Revolving Extensions of Credit then outstanding.

     “Requirement of Law” shall mean, as to any Person, the Certificate of
Incorporation or Articles of Incorporation, as the case may be, and Code of Regulations
and/or By-Laws or other organizational or governing documents of such Person, and any law,
treaty, rule or regulation, or determination of an arbitrator or a court or other
Governmental Authority, in each case applicable to or binding upon such Person or any of its
property or to which such Person or any of its property is subject.

     “Responsible Officer” shall mean, as to any Person, the Chairman, President or
an Executive, Senior or other Vice President (or, in the case of any Foreign Subsidiary, any
analogous title) of such Person and, with respect to financial matters, the Chief Financial
Officer, the Treasurer or the Controller (or, in the case of any Foreign Subsidiary, any
analogous title) of such Person.

 

22

     “Revolving Credit Commitments” shall mean, as to any Lender, such Lender’s
Facility A-1 Commitments, Facility A-2 Commitments, Facility B Commitments, Facility C
Commitments, Facility D Commitments, for all purposes other than Section 2 (other than
subsections 2.4 and 2.27) and Section 3, Sterling Commitments, Australian Commitments and
Canadian Commitments, if any, and such other Commitments under any new Revolving Facility
established in accordance with subsection 2.27(b). The original amount of the aggregate
Revolving Credit Commitments is $1,590,000,000.

     “Revolving Credit Commitment Increase” shall have the meaning assigned to such
term in subsection 2.27(a).

     “Revolving Credit Commitment Period” shall mean the period from and including
the Closing Date to, but not including, the Revolving Credit Termination Date or such
earlier date as the Revolving Credit Commitments may terminate as provided herein.

     “Revolving Credit Lender” shall mean each of the Facility A-1 Lenders, the
Facility A-2 Lenders, the Facility B Lenders, the Facility C Lenders, the Facility D Lenders
and, for all purposes other than Section 2 (other than subsections 2.4 and 2.27) and Section
3, the Australian Dollar Lenders, the Canadian Dollar Lenders and the Sterling Lenders.

     “Revolving Credit Loan” shall mean each Facility A-1 Loan, Facility A-2 Loan,
Facility B Loan, Facility C Loan, Facility D Loan and, for all purposes other than Section 2
(other than subsections 2.4 and 2.27) and Section 3, each Sterling Loan, Australian Dollar
Loan and Canadian Dollar Loan; collectively, the “Revolving Credit Loans”.

     “Revolving Credit Termination Date” shall mean the date which is the five-year
anniversary of the date hereof or such earlier date on which the Revolving Credit
Commitments shall be terminated in accordance with this Agreement.

     “Revolving Extensions of Credit” shall mean, as to any Revolving Credit Lender
at any time, an amount equal to the sum of (a) the aggregate principal amount of all
Revolving Credit Loans held by such Lender then outstanding, (b) such Lender’s Revolving
Percentage of the L/C Obligations then outstanding and (c) such Lender’s Revolving
Percentage of the aggregate principal amount of Swing Line Loans then outstanding.

     “Revolving Facilities” shall mean, without duplication, the Facility A-1
Commitments together with the Aggregate Facility A-1 Revolving Extensions of Credit
(“Facility A-1”); the Facility A-2 Commitments together with the Aggregate Facility
A-2 Revolving Extensions of Credit (“Facility A-2”); the Facility B Commitments
together with the Aggregate Facility B Revolving Extensions of Credit (“Facility
B”); the Facility C Commitments together with the Aggregate Facility C Revolving
Extensions of Credit (“Facility C”); the Facility D Commitments together with the
Aggregate Facility D Revolving Extensions of Credit (“Facility D”); and, for all
purposes other than Section 2 (other than subsections 2.4 and 2.27) and Section 3, the
Sterling Commitments together with the Aggregate Sterling Revolving Extensions of Credit
(the “Sterling Facility”); the Australian Commitments together with the Aggregate
Australian Revolving Extensions of Credit (the “Australian Facility”); the Canadian
Commitments together with the Aggregate Canadian Revolving Extensions of Credit (the
“Canadian Facility”), or any other Revolving Facility established pursuant to
subsection 2.27(b).

     “Revolving Percentage” shall mean, as to any Revolving Credit Lender in respect
of any Revolving Facility at any time, the percentage which such Lender’s Revolving Credit

 

23

Commitment under such Revolving Facility then constitutes of the aggregate Revolving
Credit Commitments in respect of such Revolving Facility (or, at any time after the
Revolving Credit Commitments shall have expired or terminated, the percentage which the
aggregate principal amount of such Lender’s Revolving Extension of Credit under any
Revolving Facility then outstanding constitutes of the aggregate principal amount of the
Revolving Extension of Credit in respect of such Revolving Facility then outstanding).

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

     “Screen” shall mean, with respect to any currency, the relevant Telerate Page
on which appears the LIBOR Base Rate for deposits in such currency; provided that,
if there is no such Telerate Page, the relevant Bloomberg Financial Markets Service page
will be substituted.

     “Security Document” shall mean each of (a) the Guarantee and Collateral
Agreement, (b) the Foreign Pledge Agreements and (c) the Foreign Pledge Agreement
Acknowledgment and Confirmation.

     “Single Employer Plan” shall mean any Plan which is covered by Title IV of
ERISA but which is not a Multi-employer Plan.

     “Sold Receivables” shall mean Receivables originated by the Borrower or its
Subsidiaries (including any related assets) sold to a Receivables Subsidiary or any other
Person pursuant to and securing obligations under any Receivables Purchase Facility.

     “Solvent” when used with respect to any Person, shall mean that, as of any date
of determination, (a) the amount of the “present fair saleable value” of the assets of such
Person will, as of such date, exceed the amount of all “liabilities of such Person,
contingent or otherwise”, as of such date, as such quoted terms are determined in accordance
with applicable federal and state laws governing determinations of the insolvency of
debtors, (b) the present fair saleable value of the assets of such Person will, as of such
date, be greater than the amount that will be required to pay the liability of such Person
on its debts as such debts become absolute and matured, (c) such Person will not have, as of
such date, an unreasonably small amount of capital with which to conduct its business, and
(d) such Person will be able to pay its debts as they mature. For purposes of this
definition, (i) “debt” means liability on a “claim”, and (ii) “claim” means any (x) right to
payment, whether or not such a right is reduced to judgment, liquidated, unliquidated,
fixed, contingent, matured, unmatured, disputed, undisputed, legal, equitable, secured or
unsecured or (y) right to an equitable remedy for breach of performance if such breach gives
rise to a right to payment, whether or not such right to an equitable remedy is reduced to
judgment, fixed, contingent, matured or unmatured, disputed, undisputed, secured or
unsecured.

     “Specified Property” shall mean all Capital Stock of any Subsidiary (subject to
subsection 6.11), Equipment, Inventory and Receivables (other than Sold Receivables) owned
by the Borrower and the Subsidiary Guarantors. The terms “Equipment” and “Inventory” as
used herein shall have the meaning assigned to such terms in the Uniform Commercial Code in
effect from time to time in the State of New York.

     “Specified Ratings” shall mean a “corporate credit rating”, in the case of S&P,
or a “corporate family rating”, in the case of Moody’s, of the Borrower (or, in each case,
such other terms as S&P or Moody’s may from time to time use to describe the Borrower’s
senior unsecured non-credit enhanced long term indebtedness) of (i) at least BB+ by S&P and
at least Ba1 by

 

24

Moody’s or (ii) at least BBB- by S&P or at least Baa3 by Moody’s, in each case with
stable outlook.

     “Standby L/C” and “Standby L/Cs” shall each have the meaning specified
in subsection 3.1(a).

     “Sterling” shall have the meaning assigned to such term in Annex B hereto.

     “Sterling Commitments” shall have the meaning assigned to such term in Annex B
hereto.

     “Sterling L/C Obligations” shall have the meaning assigned to such term in
Annex B hereto.

     “Sterling Lender” shall mean each Lender that has a Sterling Commitment or that
holds Sterling Loans; collectively, the “Sterling Lenders”. Each Sterling Lender on
the date hereof represents that it is an Eligible U.K. Bank.

     “Sterling Loan” shall mean any Sterling Loan made pursuant to Annex B hereto;
collectively, the “Sterling Loans”.

     “Sterling Subsidiary Borrower” shall mean, Scotts Holdings Limited, Scotts
Treasury EEIG and The Scotts Company (UK) Ltd. or any other Foreign Subsidiary Borrower
organized under the laws of the United Kingdom and designated as such by the Borrower in a
notice to the Administrative Agent, which shall notify each Sterling Lender thereof.

     “Sterling Swing Line Lenders” shall have the meaning assigned to such term in
Annex B hereto.

     “Sterling Swing Line Loans” shall have the meaning assigned to such term in
Annex B hereto.

     “Subordinated Debt” shall mean the Indebtedness of the Borrower under the
Existing Senior Subordinated Notes and the subordinated Indebtedness permitted under
subsection 7.5(e).

     “Subsidiary” shall mean, as to any Person, a corporation, partnership, limited
liability company, business trust, joint stock company, trust, unincorporated association,
joint venture or the European equivalent thereof of which shares of Capital Stock having
ordinary voting power (other than Capital Stock having such power only by reason of the
happening of a contingency) to elect a majority of the board of directors or equivalent are
at the time owned, or the management of which is otherwise controlled, directly, or
indirectly, through one or more intermediaries, or both, by such Person. Unless otherwise
qualified, all references to a “Subsidiary” or to “Subsidiaries” in this Agreement shall
refer to a Subsidiary or Subsidiaries of the Borrower.

     “Subsidiary Borrowers” shall mean EG Systems, Inc., Gutwein & Co., Inc.,
Hyponex Corporation, Scotts Australia Pty. Ltd., Scotts Canada Ltd., The Scotts Company LLC,
The Scotts Company (UK) Ltd., Scotts Holdings Limited, Scotts Manufacturing Company, Scotts
Temecula Operations, LLC, Scotts Treasury EEIG, SMG Growing Media, Inc., Smith & Hawken,
Ltd. and all existing or future, Domestic or Foreign, Subsidiaries then designated by the
Borrower pursuant to subsection 10.1(b).

 

25

     “Subsidiary Guarantors” shall mean (a) each Domestic Subsidiary of the Borrower
executing the Guarantee and Collateral Agreement on the Closing Date (which shall expressly
exclude each Domestic Subsidiary set forth on Schedule 1.2) and (b) each Domestic Subsidiary
acquired or organized subsequent to the Closing Date, except as otherwise provided in
subsection 6.11(c).

     “Supported Foreign Indebtedness” shall have the meaning specified in subsection
7.5(l).

     “Swing Line Commitment” shall mean the obligation of the Swing Line Lenders, at
any date, to make a Swing Line Loan pursuant to subsection 2.6(a) in the amount referred to
therein.

     “Swing Line Loan Participation Certificate” shall mean a certificate,
substantially in the form of Exhibit C hereto.

     “Swing Line Lenders” shall mean JPMCB or such other Revolving Credit Lenders as
may be requested by the Borrower or the Administrative Agent to make Swing Line Loans from
time to time.

     “Swing Line Loan” shall mean any Swing Line Loan made under the Facility A-1
Commitments, Facility A-2 Commitments, the Facility B Commitments, the Facility C
Commitments and the Facility D Commitments pursuant to subsection 2.6; collectively, the
“Swing Line Loans”.

     “Telerate Page” shall mean the “British Bankers Assoc. Interest Settlement
Rates Page” display designated at Page 3750 (or such other page on which euros or any
Optional Currency then appears) on the Moneyline Telerate (or such other page as may replace
such page on such service for the purpose of displaying the rates at which Dollar deposits
or deposits in euros or any Optional Currency are offered by leading banks in the London
interbank deposit market).

     “Term Commitment” shall mean, as to any Term Lender, the obligation of such
Lender to make a Term Loan to the Borrower hereunder in a principal amount not to exceed the
amount set forth under the heading “Term Commitment” opposite such Lender’s name on Schedule
1. The original amount of the Term Commitments is $560,000,000.

     “Term Commitment Period” shall mean the period from and including the Closing
Date to, but not including, the date which is 21 days after the Closing Date or such earlier
date as the Term Commitments may terminate as provided herein.

     “Term Facility” shall mean the Term Commitments and the Term Loan made
thereunder.

     “Term Lender” shall mean each Lender that has a Term Commitment or that holds a
Term Loan.

     “Term Loan” shall have the meaning assigned to such term in subsection 2.1.

     “Term Percentage” shall mean as to any Lender at any time, the percentage which
such Lender’s Term Commitment then constitutes of the aggregate Term Commitments (or, at any
time after the end of the Term Commitment Period, the percentage which the aggregate
principal amount of such Lender’s portion of the Term Loan then outstanding constitutes of
the aggregate principal amount of the Term Loan then outstanding).

 

26

     “Total Capitalization” shall mean, in respect of any Person at a particular
date, the sum at such date of the Total Indebtedness of such Person and the Consolidated Net
Worth of such Person.

     “Total Indebtedness” shall mean, in respect of any Person at a particular date,
the sum at such date of (a) the aggregate outstanding principal amount of all Indebtedness
for borrowed money of such Person, (b) all other items which would properly be included as
indebtedness, determined in accordance with GAAP, on a consolidated balance sheet of such
Person and its Subsidiaries and (c) the aggregate outstanding principal amount of the
obligations secured by Sold Receivables; provided that, for the purpose of
calculating the Leverage Ratio for any period, Total Indebtedness shall be reduced by cash
and Cash Equivalents set forth on the balance sheet of such Person as at such date.

     “Total Revolving Credit Commitments” shall mean, at any time, the aggregate
amount of the Revolving Credit Commitments then in effect (without duplication for the
Sterling Commitments, the Australian Commitments and the Canadian Commitments).

     “Trade L/C” shall have the meaning assigned to such term in subsection 3.1(a).

     “Transactions” shall mean, collectively, the Refinancing and the Repurchase.

     “Type” shall mean as to any Loan, its nature as an ABR Loan or a LIBOR Loan.

     “Uniform Customs” shall mean the Uniform Customs and Practice for Documentary
Credits (1993 Revision), International Chamber of Commerce Publication No. 500, as the same
may be effectively replaced in whole or in part or amended from time to time.

     “wholly owned Subsidiary” or “wholly-owned Subsidiary” shall mean any
subsidiary of any Person all of the Capital Stock of which (other than directors’ qualifying
shares required by law) is owned by such Person directly and/or through other wholly owned
Subsidiaries.

     1.2 Other Definitional Provisions.

          (a)   All terms defined in this Agreement shall have the defined meanings when used in any of
the other Loan Documents or in any certificate or other document made or delivered pursuant hereto
or thereto unless otherwise defined therein.

          (b)   As used herein, in any of the other Loan Documents, or in any certificate or other
document made or delivered pursuant hereto or thereto, accounting terms, to the extent not
otherwise defined in subsection 1.1, shall have the respective meanings given to them under GAAP.

          (c)   The words “hereof”, “herein” and “hereunder” and words of similar import when used in
this Agreement shall refer to this Agreement as a whole and not to any particular provision of this
Agreement, and section, subsection, schedule and exhibit references are to this Agreement unless
otherwise specified.

          (d)   An “affiliate” of a Lender includes, in the case of a Lender which is an investment
fund, the investment adviser thereof and any other investment fund having the same investment
adviser.

 

27

          SECTION 2. AMOUNT AND TERMS OF LOANS

          2.1  Term Commitments. Subject to the terms and conditions hereof, each Term Lender severally (but not jointly)
agrees to make a term loan in up to two borrowings (the aggregate of such term loans made to the
Borrower, the “Term Loan”) denominated in Dollars to the Borrower in an amount not to
exceed the Term Commitment of such Lender. The Term Loan may be comprised of LIBOR Loans or ABR
Loans, as determined by the Borrower and notified to the Administrative Agent in accordance with
subsections 2.2 and 2.14.

          2.2 Procedure for Term Loan Borrowing. (a) The Borrower may borrow under the Term Commitments on up to two occasions at any time
during the Term Commitment Period; provided that the Borrower shall give the Administrative
Agent irrevocable notice ((1) which notice must be received by the Administrative Agent prior to
11:00 A.M., New York City time on the Closing Date, in the case of ABR Loans and (2) which notice
must be received by the Administrative Agent prior to 11:00 A.M., New York City time three Business
Days prior to the Closing Date, in the case of LIBOR Loans), specifying (i) the requested Borrowing
Date, (ii) whether the borrowing is to be an ABR Loan or a LIBOR Loan or a combination thereof,
(iii) if the borrowing is to be entirely or partly a LIBOR Loan, the amount to be a LIBOR Loan and
(iv) the length of the Interest Period for such LIBOR Loan. Each ABR borrowing by the Borrower
pursuant to the Term Commitments shall be in an aggregate principal amount equal to $1,000,000 or a
whole multiple of $250,000 in excess thereof. Each LIBOR borrowing by the Borrower pursuant to the
Term Commitments shall be in an aggregate principal amount equal to $1,000,000 or a whole multiple
of $1,000,000 in excess thereof.

          (b)   Upon receipt of any notice from the Borrower pursuant to this subsection 2.2, the
Administrative Agent shall promptly notify each Lender thereof. Each Lender will make the amount
of its ratable share of each borrowing available to the Administrative Agent for the account of the
Borrower at the office of the Administrative Agent specified in subsection 10.2 prior to 2:00 P.M.,
New York City time, on the Borrowing Date requested by the Borrower in funds immediately available
to the Administrative Agent. Such borrowing will then be made available to the Borrower by the
Administrative Agent crediting the account of the Borrower on the books of such office with the
aggregate of the amounts made available to the Administrative Agent by the Lenders and in like
funds as received by the Administrative Agent.

          2.3 Repayment of Term Loan. The Term Loan shall mature in 19 consecutive quarterly installments, commencing on
September 30, 2007, each of which shall be in an amount equal to each Term Lender’s Term Percentage
multiplied by the amount set forth below opposite such installment.

	 	 	 	 	 
	Installment	 	Principal Amount
	September 30, 2007
	 	$	1,400,000	 
	December 31, 2007
	 	$	1,400,000	 
	March 31, 2008
	 	$	2,800,000	 
	 
	 	 	 	 
	June 30, 2008
	 	$	7,000,000	 
	September 30, 2008
	 	$	7,000,000	 
	December 31, 2008
	 	$	7,000,000	 
	March 31, 2009
	 	$	7,000,000	 
	 
	 	 	 	 
	June 30, 2009
	 	$	35,000,000	 
	September 30, 2009
	 	$	35,000,000	 
	December 31, 2009
	 	$	35,000,000	 

 

28

	 	 	 	 	 
	Installment	 	Principal Amount
	March 31, 2010
	 	$	35,000,000	 
	 
	 	 	 	 
	June 30, 2010
	 	$	42,000,000	 
	September 30, 2010
	 	$	42,000,000	 
	December 31, 2010
	 	$	42,000,000	 
	March 31, 2011
	 	$	42,000,000	 
	 
	 	 	 	 
	June 30, 2011
	 	$	54,600,000	 
	September 30, 2011
	 	$	54,600,000	 
	December 31, 2011
	 	$	54,600,000	 
	Maturity Date
	 	$	54,600,000	 

          2.4 Revolving Credit Commitment.

          (a)   Subject to and upon the terms and conditions of this Agreement:

     (i) each Facility A-1 Lender severally (but not jointly) agrees to make Facility A-1
Loans in Dollars, euros and any Optional Currency to the Borrower and/or the Regular
Subsidiary Borrowers from time to time during the Revolving Credit Commitment Period in an
aggregate principal amount not to exceed at any one time the Available Facility A-1
Commitment of such Facility A-1 Lender; provided that, after giving effect to the
making of such Facility A-1 Loans, the Aggregate Facility A-1 Revolving Extensions of Credit
will not exceed the Facility A-1 Commitments;

     (ii) each Facility A-2 Lender severally (but not jointly) agrees to make Facility A-2
Loans in Dollars to the Borrower and/or the Regular Subsidiary Borrowers from time to time
during the Revolving Credit Commitment Period in an aggregate principal amount not to exceed
at any one time the Available Facility A-2 Commitment of such Facility A-2 Lender;
provided that, after giving effect to the making of such Facility A-2 Loans, the
Aggregate Facility A-2 Revolving Extensions of Credit will not exceed the Facility A-2
Commitments;

     (iii) each Facility B Lender severally (but not jointly) agrees to make Facility B
Loans in Dollars, euros, and any Optional Currency to the Borrower and/or the Regular
Subsidiary Borrowers from time to time during the Revolving Credit Commitment Period in an
aggregate principal amount not to exceed the Available Facility B Commitment of such
Facility B Lender (which for this purpose shall be computed as though the amount in
subclause (b)(i) in the definition thereof is $0); provided that, after giving
effect to the making of such Facility B Loans, the Aggregate Facility B Revolving Extensions
of Credit will not exceed the Facility B Commitments;

     (iv) each Facility C Lender severally (but not jointly) agrees to make Facility C Loans
in Dollars, euros, and any Optional Currency to the Borrower and/or the Regular Subsidiary
Borrowers from time to time during the Revolving Credit Commitment Period in an aggregate
principal amount not to exceed the Available Facility C Commitment of such Facility C
Lender; provided that, after giving effect to the making of such Facility C Loans,
the Aggregate Facility C Revolving Extensions of Credit will not exceed the Facility C
Commitments (which for this purpose shall be computed as though the amount in subclause
(b)(i) in the definition thereof is $0);

     (v) each Facility D Lender severally (but not jointly) agrees to make Facility D Loans
in Dollars, euros, and any Optional Currency to the Borrower and/or the Regular Subsidiary

 

29

Borrowers from time to time during the Revolving Credit Commitment Period in an aggregate
principal amount not to exceed the Available Facility D Commitment of such Facility D Lender
(which for this purpose shall be computed as though the amount in subclause (b)(i) in the
definition thereof is $0); provided that, after giving effect to the making of such
Facility D Loans, the Aggregate Facility D Revolving Extensions of Credit will not exceed
the Facility D Commitments;

     (vi) each Sterling Lender, which shall also be a Facility B Lender or an affiliate
thereof, severally (but not jointly) agrees to make Sterling Loans in Sterling or euros to
each Sterling Subsidiary Borrower from time to time during the Revolving Credit Commitment
Period in an aggregate principal amount not to exceed the Available Sterling Commitment of
such Sterling Lender in accordance with the terms of Annex B hereto (which for this purpose
shall be computed as though the amount in subclause (b)(i) in the definition thereof is $0);
provided that, after giving effect to the making of such Sterling Loans, the
Aggregate Sterling Revolving Extensions of Credit will not exceed the Sterling Commitments;

     (vii) each Australian Dollar Lender, which shall be a Facility C Lender or an affiliate
thereof, severally (but not jointly) agrees to make Australian Dollar Loans in Australian
Dollars to each Australian Subsidiary Borrower from time to time during the Revolving Credit
Commitment Period in an aggregate principal amount not to exceed the Available Australian
Commitment of such Australian Dollar Lender in accordance with the terms of Annex C hereto
(which for this purpose shall be computed as though the amount in subclause (b)(i) in the
definition thereof is $0); provided that, after giving effect to the making of such
Australian Dollar Loans, the Aggregate Australian Revolving Extensions of Credit will not
exceed the Australian Commitments; and

     (viii) each Canadian Dollar Lender, which shall be a Facility D Lender or an affiliate
thereof, severally (but not jointly) agrees to make, Canadian Dollar Loans in Canadian
Dollars to each Canadian Subsidiary Borrower from time to time during the Revolving Credit
Commitment Period in an aggregate principal amount not to exceed the Available Canadian
Commitment of such Canadian Dollar Lender in accordance with the terms of Annex D hereto
(which for this purpose shall be computed as though the amount in subclause (b)(i) in the
definition thereof is $0); provided that, after giving effect to the making of such
Canadian Dollar Loans, the Aggregate Canadian Revolving Extensions of Credit will not exceed
the Canadian Commitment.

          (b)   During the Revolving Credit Commitment Period the Borrower and the Subsidiary Borrowers
may use the Revolving Credit Commitments by borrowing, repaying the Revolving Credit Loans in whole
or in part, and reborrowing, all in accordance with the terms and conditions hereof. Except as
provided in Annex B, Annex C or Annex D, each Revolving Credit Lender shall only be required to
make Revolving Credit Loans (x) in Dollars, (y) in euros and (z) in Optional Currencies. The
Borrower and Regular Subsidiary Borrowers may make ABR Loan and LIBOR Loan borrowings in Dollars
and may make LIBOR Loan borrowings in euros and any Optional Currency under any Revolving Facility.
Foreign Subsidiary Borrowers may make borrowings under the Revolving Facilities
as provided for in Annex B, Annex C or Annex D. Each Facility B Lender, in respect of
Sterling Loans, Facility C Lender, in respect of Australian Dollar Loans, and Facility D Lender in
respect of Canadian Dollar Loans, agrees that each of its Lending Installations making or holding
Sterling Loans, Australian Dollar Loans or Canadian Dollar Loans hereunder shall be on the date
hereof, on the date any such Loans are made hereunder and, after giving effect to an assignment
pursuant to subsection 10.6 hereof, an Eligible U.K. Bank, an Eligible Australian Bank or an
Eligible Canadian Bank, as the case may be.

          2.5 Procedure for Revolving Credit Borrowing.

 

30

          (a)   The Borrower and the Regular Subsidiary Borrowers may borrow under any Revolving
Facility during the Revolving Credit Commitment Period on any Business Day; provided that
the Borrower or the relevant Regular Subsidiary Borrower shall give the Administrative Agent
irrevocable notice (which notice may be made by telephone and confirmed in writing promptly
thereafter) (1) on the requested Borrowing Date, in the case of ABR Loans (which notice must be
received by the Administrative Agent prior to 11:00 A.M., New York City time), (2) three Business
Days prior to the requested Borrowing Date, in the case of LIBOR Loans in Dollars (which notice
must be received by the Administrative Agent prior to 11:00 A.M., New York City time) and (3) three
Business Days prior to the requested Borrowing Date, in the case of LIBOR Loans in euros or an
Optional Currency (which notice must be received by 11:00 A.M. London time), specifying (i) the
identity of the Borrower or Regular Subsidiary Borrower borrowing and the amount and currency to be
borrowed, (ii) the requested Borrowing Date, (iii) the Revolving Facility under which the borrowing
is to be made, (iv) whether the borrowing is to be an ABR Loan (in the case of Revolving Credit
Loans in Dollars) or a LIBOR Loan or a combination thereof, and (v) if the borrowing is to be
entirely or partly a LIBOR Loan, the amount to be a LIBOR Loan and the length of the Interest
Period for such LIBOR Loan. Each ABR borrowing by the Borrower or any Regular Subsidiary Borrower
pursuant to the Revolving Credit Commitments shall be in an aggregate principal amount equal to
$1,000,000 or a whole multiple of $250,000 in excess thereof. Each LIBOR borrowing in Dollars by
the Borrower or any Regular Subsidiary Borrower pursuant to the Revolving Credit Commitments shall
be in an aggregate principal amount equal to $1,000,000 or a whole multiple of $1,000,000 in excess
thereof. Each LIBOR borrowing in euros or an Optional Currency by the Borrower or any Regular
Subsidiary Borrower pursuant to the Revolving Credit Commitments shall be in an aggregate principal
amount equal to $2,500,000 or a whole multiple of $1,000,000 in excess thereof in the Non-Dollar
Currency Equivalent thereof.

          (b)   Upon receipt of any notice from the Borrower or a Regular Subsidiary Borrower pursuant
to this subsection 2.5, the Administrative Agent shall promptly notify each Revolving Credit Lender
under the relevant Revolving Facility thereof. Each such Revolving Credit Lender will make the
amount of its ratable share (subject to subsection 2.4) of each borrowing available to the
Administrative Agent for the account of the Borrower or such Regular Subsidiary Borrower at the
office of the Administrative Agent specified in subsection 10.2 prior to 2:00 P.M., New York City
time (or in the case of any borrowing in an Optional Currency, at the place and time specified by
the Administrative Agent from time to time), on the Borrowing Date requested by the Borrower or
such Regular Subsidiary Borrower in funds immediately available to the Administrative Agent. Such
borrowing will then be made available to the Borrower or such Regular Subsidiary Borrower by the
Administrative Agent crediting the account of the Borrower or such Regular Subsidiary Borrower on
the books of such office with the aggregate of the amounts made available to the Administrative
Agent by such Revolving Credit Lenders and in like funds as received by the Administrative Agent.

          2.6 Swing Line Commitments.

          (a)   Subject to the terms and conditions hereof, from time to time prior to the Revolving
Credit Termination Date each Swing Line Lender severally (but not jointly) agrees to make Swing
Line Loans in Dollars or euros to the Borrower or any Regular Subsidiary Borrower in an aggregate
principal amount not to exceed $75,000,000 at any one time outstanding (each of the foregoing
individually, a “Swing Line Loan”; collectively the “Swing Line Loans”), which Swing Line Loans may
be borrowed under any of the Facility A-1 Commitments, Facility A-2 Commitments, the Facility B
Commitments, the Facility C Commitments or the Facility D Commitments; provided that, after giving
effect to the making of such Swing Line Loans, the aggregate principal amount of Swing Line Loans
(including any Sterling Swing Line Loans, Australian Dollar Swing Line Loans and Canadian Dollar
Swing Line Loans) made under any Revolving Facility (including the Sterling Facility, Australian
Facility and Canadian Facility) at any one time outstanding shall not exceed $100,000,000 or the
Non-Dollar Currency Equivalent thereof

 

31

and the Aggregate Facility A-1 Revolving Extensions of
Credit shall not exceed the Facility A-1 Commitments, the Aggregate Facility A-2 Revolving
Extensions of Credit shall not exceed the Facility A-2 Commitments, the Aggregate Facility B
Revolving Extensions of Credit shall not exceed the Facility B Commitments, the Aggregate Facility
C Revolving Extensions of Credit shall not exceed the Facility C Commitments and the Aggregate
Facility D Revolving Extensions of Credit shall not exceed the Facility D Commitments. All Swing
Line Loans shall be made on terms agreed upon by the relevant Swing Line Lender and the Borrower or
applicable Regular Subsidiary Borrower. The Borrower or applicable Regular Subsidiary Borrower
shall give the Administrative Agent irrevocable notice (which notice may be made by telephone (and
confirmed in writing promptly thereafter) and must be received by the Administrative Agent at or
prior to 1:00 P.M., New York City time, on the requested Borrowing Date), specifying the amount of
each requested Swing Line Loan, which shall be greater than or equal to a minimum amount to be
agreed upon by the Borrower or applicable Regular Subsidiary Borrower and the relevant Swing Line
Lender, and the Revolving Facility under which it is to be borrowed. In giving irrevocable notice,
the Borrower or the applicable Regular Subsidiary Borrower shall designate, at its option, one or
two Swing Line Lenders to make one or more Swing Line Loans in the relevant currency. Upon such
notice, the Administrative Agent shall promptly notify each applicable Swing Line Lender thereof.
Each Swing Line Lender which has been designated by the Borrower or the applicable Regular
Subsidiary Borrower in its irrevocable notice shall make the amount of its ratable share of each
borrowing in the currency requested available to the Borrower or applicable Regular Subsidiary
Borrower in the manner directed by the Administrative Agent on the requested Borrowing Date.

          (b)   The Swing Line Lenders or any of them at any time and in their or its sole and absolute
discretion, may, on behalf of the Borrower or applicable Regular Subsidiary Borrower (which hereby
irrevocably directs the Swing Line Lenders to act on its behalf), request each Revolving Credit
Lender under the applicable Revolving Facility, including each Swing Line Lender, with respect to
all other Swing Line Loans, to make a Revolving Credit Loan under such Revolving Facility, in the
currency of the Swing Line Loan(s) made by such Swing Line Lender(s) in an amount equal to such
Lender’s Revolving Percentage under such Revolving Facility of the amount of the Swing Line Loans
(the “Refunded Swing Line Loans”) outstanding on the date such notice is given. Unless any
of the events described in paragraph (f) of Section 8 shall have occurred (in which event the
procedures of paragraph (c) of this subsection 2.6 shall apply), each Revolving Credit Lender shall
make the proceeds of its Revolving Credit Loan available to the Administrative Agent for the
account of the Swing Line Lenders, at the office of the Administrative Agent prior to 12:00 Noon
(New York City time) in funds immediately available on the Business Day next succeeding the date
such notice is given. The proceeds of such Revolving Credit Loans shall be immediately applied to
repay the Refunded Swing Line Loans.

          (c)   If, prior to the making of a Revolving Credit Loan pursuant to paragraph (b) of
subsection 2.6, one of the events described in paragraph (f) of Section 8 shall have occurred, each
Revolving Credit Lender under the applicable Revolving Facility hereby agrees to and will, on
the date such Revolving Credit Loan was to have been made, purchase an undivided participating
interest in each Refunded Swing Line Loan in an amount equal to its Revolving Percentage under such
Revolving Facility of such Refunded Swing Line Loan. Such Revolving Credit Lender will immediately
transfer to the Administrative Agent for the account of the Swing Line Lenders, in immediately
available funds denominated in Dollars, the Dollar Equivalent (if applicable) of the amount of its
participations and, upon its receipt of its ratable share thereof, each Swing Line Lender will
deliver to such Revolving Credit Lender a Swing Line Loan Participation Certificate dated the date
of receipt of such funds and in such amount. On such date, any Swing Line Loans not denominated in
Dollars shall, without any further action or notice being required, be converted to and become
denominated in Dollars in an amount equal to the Dollar Equivalent of the amount thereof on such
date.

 

32

          (d)   Whenever, at any time after any Swing Line Lender has received from any Revolving Credit
Lender such Revolving Credit Lender’s participating interest in a Refunded Swing Line Loan and such
Swing Line Lender receives any payment on account thereof, such Swing Line Lender will distribute
to such Revolving Credit Lender through the Administrative Agent its participating interest in such
Dollar Equivalent amount (appropriately adjusted, in the case of interest payments, to reflect the
period of time during which such Revolving Credit Lender’s participating interest was outstanding
and funded) in funds denominated in Dollars; provided, however, that in the event
that such payment received by such Swing Line Lender is required to be returned, such Revolving
Credit Lender will return to such Swing Line Lender through the Administrative Agent any portion
thereof previously distributed by such Swing Line Lender to it in like funds as such payment is
required to be returned by such Swing Line Lender.

          2.7 Participation. Each Revolving Credit Lender’s obligation to purchase participating interests pursuant to
paragraph (c) of subsection 2.6 shall be absolute and unconditional and shall not be affected by
any circumstances, including, without limitation, (a) any set-off, counterclaim, recoupment,
defense or other right which such Revolving Credit Lender may have against the Swing Line Lender,
the Borrower, any Regular Subsidiary Borrower or any other Person for any reason whatsoever; (b)
the occurrence or continuance of an Event of Default; (c) any adverse change in the condition
(financial or otherwise) of the Borrower or any Subsidiary; (d) any breach of this Agreement by the
Borrower, any Regular Subsidiary Borrower or any other Revolving Credit Lender; or (e) any other
circumstance, happening or event whatsoever, whether or not similar to any of the foregoing.
Notwithstanding the foregoing, no Revolving Credit Lender shall have any obligation to purchase
participating interests pursuant to paragraph (c) of subsection 2.6 or to make any Refunded Swing
Line Loans in respect of any Swing Line Loan which was made at any time following receipt by the
Administrative Agent of a notice from any Revolving Credit Lender specifying that (x) a Default or
Event of Default has occurred and is continuing and (y) explicitly stating that such Revolving
Credit Lender will not purchase such participating interests or make Refunded Swing Line Loans with
respect to Swing Line Loans made after the date of receipt of such notice.

          2.8 Repayment of Revolving Credit Loans; Evidence of Debt.

          (a)   The Borrower hereby unconditionally promises to pay to the Administrative Agent for the
account of each Lender (i) the then unpaid principal amount of each Revolving Credit Loan of such
Lender on the Revolving Credit Termination Date (or such earlier date on which the Loans become due
and payable pursuant to Section 8) and (ii) the then unpaid principal amount of the Swing Line
Loans of the Swing Line Lender on the Revolving Credit Termination Date (or such earlier date on
which the Swing Line Loans become due and payable pursuant to Section 8). Each of the Regular
Subsidiary
Borrowers hereby unconditionally promises to pay to the Administrative Agent for the account
of such Lender (i) the then unpaid principal amount of each Loan to such Subsidiary Borrower on the
Revolving Credit Termination Date (or such earlier date on which the Revolving Credit Loans become
due and payable pursuant to Section 8) and (ii) the then unpaid principal amount of the Swing Line
Loans to such Subsidiary Borrower of the Swing Line Lender on the Revolving Credit Termination Date
(or such earlier date on which the Swing Line Loans became due and payable pursuant to Section 8).
Each of the Borrower and the relevant Subsidiary Borrowers hereby further agrees to pay interest on
the unpaid principal amount of the Loans from time to time outstanding to the Borrower or such
Subsidiary Borrower, as applicable, from the date hereof until payment in full thereof at the rates
per annum, and on the dates, set forth in subsection 2.15.

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

 

33

          (c)   The Administrative Agent shall maintain the Register pursuant to subsection 10.6(b)(iv),
and a subaccount therein for each Lender, in which shall be recorded (i) the amount of each Loan
made hereunder, the Type thereof and each Interest Period applicable thereto, (ii) the amount of
any principal or interest due and payable or to become due and payable from the Borrower or a
Regular Subsidiary Borrower to each Lender hereunder and (iii) both the amount of any sum received
by the Administrative Agent hereunder from the Borrower or such Regular Subsidiary Borrower and
each Lender’s share thereof.

          (d)   The entries made in the Register and the accounts of each Lender maintained pursuant to
subsection 2.8(b) shall, to the extent permitted by applicable law, be prima facie
evidence of the existence and amounts of the obligations of the Borrower and each Regular
Subsidiary Borrower therein recorded; provided, however, that the failure of any
Lender or the Administrative Agent to maintain the Register or any such account, or any error
therein, shall not in any manner affect the obligation of the Borrower or such Regular Subsidiary
Borrower to repay (with applicable interest) the Loans made to such Borrower or such Regular
Subsidiary Borrower by such Lender in accordance with the terms of this Agreement.

          (e)   No Loan to Scotts Treasury EEIG may remain outstanding for more than 11.5 months and,
after any such Loan is repaid, there shall be a period of at least two weeks during which Scotts
Treasury EEIG has no Loan or other amount outstanding under any Facility; provided that the
Borrower may deliver a notice to the Administrative Agent at any time directing that the
restriction in this subsection 2.8(e) shall cease to apply with respect to such Loan or such period
as are mentioned in any such notice.

          2.9 Commitment Fee, etc.

          (a)   The Borrower agrees to pay to the Administrative Agent, for the account of each
Revolving Credit Lender, a commitment fee in Dollars for the period from and including the Closing
Date to the date that the Revolving Credit Commitments are terminated (or if later, the date that
the Loans and L/C Obligations shall be repaid in full), calculated as an amount equal to the
product of (a) the Commitment Fee Rate and (b) the average daily unused portion of the Revolving
Credit Commitment of such Lender (it being understood that such Lender’s Revolving Percentage of
the outstanding L/C Obligations at such time shall constitute usage of such Lender’s Revolving
Credit Commitment) during
the period for which such commitment fee is calculated, payable quarterly in arrears on the
last day of each March, June, September and December and on the Revolving Credit Termination Date
(or if later, the date that the Loans and L/C Obligations shall be repaid in full).

          (b)   The Borrower agrees to pay to the Administrative Agent, for the account of each Term
Lender, a commitment fee in Dollars for the Term Commitment Period, calculated as an amount equal
to the product of (a) the Commitment Fee Rate and (b) the average daily unused portion of the Term
Commitment of such Lender during the Term Commitment Period, payable on the last day of March 2007.

          (c)   The Borrower agrees to pay to the Administrative Agent the fees in the amounts and on
the dates as set forth in any fee agreements with the Administrative Agent and to perform any other
obligations contained therein.

          2.10 Termination or Reduction of Commitments.

          (a)   Optional. The Borrower shall have the right, upon not less than five Business
Days’ written notice to the Administrative Agent, to terminate the Revolving Credit Commitments or,
from time

 

34

to time, reduce the amount of the Revolving Credit Commitments, provided that (i)
any such reduction shall be applied ratably across Facility A-1, Facility A-2 Facility B, Facility
C and Facility D (with corresponding reductions across the Sterling Facility, the Australian
Facility and the Canadian Facility), (ii) any such reduction shall be accompanied by prepayment of
the Revolving Credit Loans under the applicable Revolving Facility by the Borrower and/or any
Regular Subsidiary Borrower, as applicable, together with accrued interest on the amount so prepaid
to the date of such prepayment, to the extent, if any, the Available Facility A-1 Commitments, the
Available Facility B Commitments, Available Facility C Commitments or the Available Facility D
Commitments would be negative, (ii) any such termination of the Revolving Credit Commitments shall
be accompanied by (A) prepayment in full of the Revolving Credit Loans then outstanding hereunder,
(B) cash collateralization of all L/C Obligations then outstanding in accordance with the
provisions of subsection 2.13, and (C) payment of accrued interest thereon to the date of such
prepayment and the payment of any unpaid fees then accrued hereunder (including, without
limitation, in respect of any Letters of Credit) and (iii) any termination of the Revolving Credit
Commitments while LIBOR Loans are outstanding under the Revolving Credit Commitments and any
reduction of the aggregate amount of the Revolving Credit Commitments that reduces the amount of
the Revolving Credit Commitments under any Revolving Facility below the principal amount of the
LIBOR Loans then outstanding thereunder may be made only on the last day of the respective Interest
Periods for such LIBOR Loans. Upon receipt of such notice, the Administrative Agent shall promptly
notify each Lender thereof. Any such reduction shall be in an amount of $1,000,000 or a whole
multiple of $1,000,000 in excess thereof (or in the case of a LIBOR borrowing in euros, an Optional
Currency, the Dollar Equivalent thereof) and shall reduce permanently the amount of the Revolving
Credit Commitments then in effect.

     (b)   Mandatory. (i) The Revolving Credit Commitments shall automatically
terminate on the Revolving Credit Termination Date and all Revolving Credit Loans shall be
repaid and to the extent any Letter of Credit remains outstanding after the Revolving Credit
Termination Date, the Borrower shall cash collateralize such L/C Obligations (and the fees
thereon) in accordance with the provisions of subsection 2.13.

     (ii) The Term Commitments shall automatically terminate on the earlier to occur of (i)
the borrowing of the Term Loan and (ii) the expiration of the Term Commitment Period.

          2.11 Optional Prepayments. The Borrower or any Regular Subsidiary Borrower may, at any time and from time to
time prepay Loans under any Facility made to it hereunder, in whole or in part, without premium or
penalty, upon irrevocable notice to the Administrative Agent (which notice may be made by telephone
and confirmed in writing promptly thereafter): (1) on the date of such prepayment, in the case of
ABR Loans (which notice must be received by the Administrative Agent prior to 12:00 Noon, New York
City time), (2) three Business Days prior to the date of such prepayment, in the case of LIBOR
Loans in Dollars (which notice must be received by the Administrative Agent prior to 12:00 Noon,
New York City time) and (3) three Business Days prior to the date of such prepayment, in the case
of LIBOR Loans in euros or an Optional Currency (which notice must be received by 12:00 Noon,
London time), specifying the date and amount of prepayment, the relevant Facility and whether the
prepayment is of LIBOR Loans, ABR Loans or a combination thereof, and, if a combination thereof,
the amount of prepayment allocable to each. If such notice is given, the Borrower or the relevant
Regular Subsidiary Borrower shall make such prepayment and the payment amount specified in such
notice shall be due and payable on the date specified therein, together with accrued interest to
such date on the amount prepaid. Partial prepayments shall be in an aggregate principal amount of
$1,000,000 or a whole multiple of $250,000 in excess thereof (or in the case of a LIBOR borrowing
in euros or an Optional Currency, the Dollar Equivalent thereof), provided that unless a LIBOR Loan
is prepaid in full, no prepayment shall be made if, after giving effect to such prepayment, the
aggregate principal amount of LIBOR Loans in Dollars outstanding with respect to which a common
Interest Period has been selected shall be less than

 

35

$1,000,000 or, in the case of LIBOR Loans in
euros or an Optional Currency, after giving effect to such prepayment, the aggregate principal
amount of LIBOR Loans in euros or an Optional Currency outstanding with respect to which a common
Interest Period has been selected shall be less than $2,500,000 or the Non-Dollar Currency
Equivalent thereof.

          2.12 Mandatory Prepayments.

          (a)   The Borrower, without notice or demand, shall immediately prepay the Revolving Credit
Loans under any Revolving Facility, or cause such Loans to be prepaid by the Regular Subsidiary
Borrowers, to the extent, if any, that the Available Facility A-1 Commitments, the Available
Facility A-2 Commitments, the Available Facility B Commitments, the Available Facility C
Commitments or the Available Facility D Commitments, as the case may be, are negative, together
with accrued interest to the date of such prepayment on the amount so prepaid; provided
that if such prepayment is required solely as a result of a change in the aggregate Dollar
Equivalent of the Revolving Credit Loans in euros or an Optional Currency, no prepayment shall be
made unless such prepayment is required pursuant to subsection 2.24 under the applicable Revolving
Facility.

          (b)   Unless the Required Lenders shall otherwise agree, until the Term Loan has been repaid
in full, if any Indebtedness shall be incurred by the Borrower or any of its Subsidiaries
(excluding any Indebtedness incurred in accordance with subsection 7.5), the Borrower shall apply
an amount equal to 100% of the Net Cash Proceeds thereof on the date of such incurrence toward the
prepayment of the Term Loan.

          (c)   Unless the Required Lenders shall otherwise agree, if on any date the Borrower or any of
its Subsidiaries shall receive Net Cash Proceeds from any Asset Sale or Recovery Event then, unless
a Reinvestment Notice shall be delivered in respect thereof, an amount equal to such Net Cash
Proceeds shall be applied by the Borrower or its Subsidiaries toward the prepayment of the Term
Loan; provided, that, notwithstanding the foregoing, (i) Net Cash Proceeds of any Asset
Sale specified in any
Reinvestment Notice must be reinvested within one year from the date such Net Cash Proceeds
are received by the Borrower or any of its Subsidiaries and (ii) on each Reinvestment Prepayment
Date, an amount equal to the Reinvestment Prepayment Amount with respect to the relevant
Reinvestment Event shall be applied toward the prepayment of the Term Loan; provided
further, that no prepayment under this subsection 2.12(c) shall be required if the
Specified Ratings are in effect on the date Net Cash Proceeds from any Asset Sale or Recovery Event
are received by the Borrower or any of its Subsidiaries or would otherwise be required to be
applied toward the prepayment of the Term Loan pursuant to this subsection 2.12(c).

          (d) Upon the request of the Required Lenders by written notice from the Administrative Agent
to the Borrower, if the application of funds to consummate the Repurchase shall not have been
completed by the date which is 90 days after the Closing Date, the Borrower shall make a prepayment
of the Term Loan in an amount equal to the difference, if positive, between the original principal
amount of the Term Loan (after giving effect to each permitted drawing hereunder) less the
aggregate amount paid by the Borrower as of such date to consummate the Repurchase, including costs
and expenses related thereto, and any prepayments previously made pursuant to subsection 2.12(e).

          (e)   Upon the request of the Required Lenders by written notice from the Administrative Agent
to the Borrower, if Existing Senior Subordinated Notes remain outstanding on the date which is 21
days after the Closing Date, the Borrower shall make a prepayment of the Term Loan in an amount
equal to the aggregate principal amount of the Existing Senior Subordinated Notes in excess of
$20,000,000 then outstanding, if any.

 

36

          (f)   No further prepayments of Term Loans shall be required under clauses (b), (c), (d) or
(e) of this subsection 2.12 if the outstanding principal amount of Term Loans has been reduced to
zero.

          2.13 Cash Collateralization of Letters of Credit. To the extent that at any time and from time to time, the L/C Obligations exceed the amount
of the L/C Commitments or the L/C Obligations under any Revolving Facility exceed the Revolving
Credit Commitments under such Revolving Facility (whether pursuant to subsections 2.10, 2.11, 2.12
or otherwise), the Borrower shall cash collateralize (in a manner reasonably satisfactory to the
Administrative Agent) such portion of the L/C Obligations (and the fees thereon through the stated
expiration date of the Letters of Credit giving rise to such L/C Obligations) which is in excess of
the L/C Commitments or such Revolving Credit Commitments, as applicable.

          2.14 Conversion Options.   The Borrower or any Regular Subsidiary Borrower may elect from time to time to convert
LIBOR Loans in Dollars under any Facility to ABR Loans under such Facility, and may elect from time
to time to convert ABR Loans in Dollars under any Facility to LIBOR Loans under such Facility, by
giving the Administrative Agent at least three Business Days’ prior irrevocable written notice of
such election to convert (which date shall be a Business Day and in the case of any conversion of
any LIBOR Loans to ABR Loans, the last day of an Interest Period therefor), the amount and type of
conversion and, in the case of any conversion of ABR Loans to LIBOR Loans, the Interest Period
selected with respect thereto; provided, however, that (i) ABR Loans may not be
converted to LIBOR Loans when any Default or Event of Default has occurred and is continuing
without the consent of the Administrative Agent and (ii) Swing Line Loans may not, at any time, be
converted to LIBOR Loans. All or any part of outstanding LIBOR Loans or ABR Loans may be converted
as provided herein, provided that partial conversions of LIBOR Loans to ABR Loans shall be
in an aggregate principal amount of $2,500,000 or a whole multiple thereof and partial conversions
of ABR Loans to LIBOR Loans with
respect to which a common Interest Period has been selected shall be in an aggregate principal
amount of $5,000,000 or a whole multiple of $2,500,000 in excess thereof, and provided, further,
that in the case of a partial conversion of LIBOR Loans to ABR Loans, after giving effect to such
conversion, the aggregate principal amount of the LIBOR Loans outstanding with respect to which a
common Interest Period has been selected shall be not less than $5,000,000.

          (b)   Any LIBOR Loans may be continued as such upon the expiration of an Interest Period by
compliance by the Borrower or the Regular Subsidiary Borrowers with the notice provisions contained
in the definition of Interest Period, provided that no LIBOR Loan in Dollars may be
continued as such when any Default or Event of Default has occurred and is continuing, but shall be
automatically converted to an ABR Loan on the last day of the last Interest Period for which a
LIBOR Rate was determined by the Administrative Agent on or prior to the Administrative Agent’s
obtaining knowledge of such Default or Event of Default.

          (c)   No conversion or continuation of any Revolving Credit Loans under any Revolving Facility
shall be made pursuant to this subsection 2.14 if, after giving effect to such conversion or
continuation the amount of the Available Facility A-1 Commitments, the Available Facility A-2
Commitments, the Available Facility B Commitments, the Available Facility C Commitments or the
Available Facility D Commitments, as the case may be, would be negative.

          (d)   Conversions of Revolving Credit Loans in any currency to another currency shall be made
by repaying such Revolving Credit Loans and reborrowing in such other currency in compliance with
the provisions hereof.

          2.15 Interest Rate and Payment Dates.

 

37

          (a)   Each LIBOR Loan shall bear interest for each day during each Interest Period with
respect thereto at a rate per annum equal to the LIBOR Rate determined for such Interest Period
plus the Applicable Margin.

          (b)   Each ABR Loan shall bear interest for the period from and including the date thereof
until maturity at a rate per annum equal to the ABR plus the Applicable Margin.

          (c)   If all or a portion of (i) the principal amount of any Loan or any reimbursement
obligation, (ii) any interest payable thereon or (iii) any commitment fee, commission or other
amount payable hereunder shall not be paid when due (whether at the stated maturity, by
acceleration or otherwise), such overdue amount shall bear interest at a rate per annum which is
(A) the rate pursuant to paragraph (a) of this subsection plus 2% or (B) in the case of amounts in
Dollars, if higher, the rate described in paragraph (b) of this subsection 2.15 plus 2%, in each
case from the date of such non-payment until such amount is paid in full (as well after as before
judgment). The Administrative Agent may choose any Interest Period from time to time (including
one Interest Period of shorter than one month) with respect to any overdue amount bearing interest
based upon paragraph (a) of this subsection.

          (d)   Interest shall be payable in arrears on each Interest Payment Date, except that interest
payable pursuant to subsection 2.15 (c) shall be payable upon demand.

          2.16 Computation of Interest and Fees.

          (a)   Each determination of an interest rate by the Administrative Agent pursuant to any
provision of this Agreement shall be conclusive and binding on the Borrower and the Regular
Subsidiary Borrowers absent manifest error.

          (b)   Interest (other than interest based on the Prime Rate) shall be calculated on the basis
of a 360-day year for the actual days elapsed (subject, in the case of any LIBOR Loan in an
Optional Currency, to any market convention for a different basis as determined by the
Administrative Agent); and commitment fees and interest based on the Prime Rate shall be calculated
on the basis of a 365- (366-, as the case may be) day year for the actual days elapsed. The
Administrative Agent shall as soon as practicable notify the Borrower and the affected Lenders of
each determination of the LIBOR Rate. Any change in the interest rate on a Loan resulting from a
change in the ABR or any LIBOR reserve requirements shall become effective as of the opening of
business on the day on which such change becomes effective. The Administrative Agent shall as soon
as practicable notify the Borrower and the affected Lenders of the Closing Date and the amount of
such change in interest rate.

          (c)   The Administrative Agent shall, at the request of the Borrower or a Regular Subsidiary
Borrower or any Lender, deliver to the Borrower or a Regular Subsidiary Borrower or such Lender a
statement showing in reasonable detail the calculations used by the Administrative Agent in
determining any interest rate pursuant to subsection 2.15, excluding any LIBOR Base Rate which is
based upon the British Bankers Assoc. Interest Settlement Rates Page.

          2.17 Inability to Determine Interest Rate. In the event that the Reference Lenders shall have reasonably determined (which
determination shall be conclusive and binding upon the Borrower and the Regular Subsidiary
Borrowers absent manifest error) that by reason of circumstances affecting the interbank
eurocurrency market, adequate and reasonable means do not exist for ascertaining the LIBOR Rate
applicable pursuant to subsection 2.15(a) for any Interest Period with respect to (a) a proposed
Loan that has been requested be made as a LIBOR Loan, (b) a LIBOR Loan that will result from the
requested conversion of an ABR Loan into a LIBOR Loan or (c) the continuation of LIBOR Loans beyond
the expiration of the then current Interest Period with respect thereto, the Administrative Agent
shall

 

 

38

forthwith give telecopy or telephonic notice of such determination, confirmed in
writing, to the Borrower and the Lenders at least one Business Day prior to, as the case may be,
the requested Borrowing Date for such LIBOR Loan, the conversion date of such ABR Loan or the last
day of such Interest Period. If such notice is given (i) any requested LIBOR Loan in Dollars shall
be made as an ABR Loan, (ii) any ABR Loan that was to have been converted to a LIBOR Loan shall be
continued as an ABR Loan, (iii) any outstanding LIBOR Loan in Dollars shall be converted, on the
last day of the then current Interest Period with respect thereto, to an ABR Loan and (iv) the
LIBOR Rate for such Interest Period for any affected LIBOR Loans in euros or any Optional Currency
shall bear interest for such Interest Period at a rate reasonably determined by the Administrative
Agent as representing the cost to Lenders generally holding such LIBOR Loans of funding such LIBOR
Loans for such Interest Period plus the Applicable Margin. Until such notice has been withdrawn by
the Administrative Agent, no further LIBOR Loans shall be made nor shall the Borrower have the
right to convert an ABR Loan to a LIBOR Loan. Such notice shall be withdrawn by the Administrative
Agent when the Administrative Agent shall reasonably determine that adequate and reasonable means
exist for ascertaining the LIBOR Rate.

     2.18 Pro Rata Treatment and Payments.

     (a) Each borrowing from the Revolving Credit Lenders hereunder shall be made under the
Revolving Facility specified by the Borrower in accordance with subsections 2.4 and 2.5. The
borrowing of the Term Loan hereunder shall be made ratably from the Term Lenders according to their
respective Term Percentages. Any reduction of the Revolving Credit Commitments under any Revolving
Facility of the Lenders shall be made ratably.

     (b) Each payment (including each prepayment) on account of principal of and interest on the
Revolving Credit Loans in any currency shall be made ratably according to the respective
outstanding principal amounts of such Loans then held by the Revolving Credit Lenders, subject in
the case of prepayments of principal to any designation of the Administrative Agent pursuant to
subsection 2.3. The Borrower or a Regular Subsidiary Borrower may select the currency or
currencies of any optional or mandatory prepayment of the Revolving Credit Loans.

     (c) Each payment (including each prepayment) by the Borrower on account of principal of and
interest on the Term Loan shall be made ratably according to the outstanding principal amount of
the Term Loan. The amount of each principal prepayment of the Term Loan shall be applied ratably
to reduce the then remaining installments thereof. Amounts prepaid on account of the Term Loan may
not be reborrowed.

     (d) All payments (including prepayments) to be made by the Borrower or any Regular Subsidiary
Borrower hereunder, whether on account of principal, interest, fees or otherwise, shall be made
without set off or counterclaim and shall be made prior to 12:00 Noon, New York City time, on the
due date thereof to the Administrative Agent, for the account of the relevant Lenders, at the
Administrative Agent’s office specified in subsection 10.2, in Dollars or euros, as applicable, and
in immediately available funds (or in the case of any payment in an Optional Currency, in the
relevant Optional Currency and at the place and time specified by the Administrative Agent from
time to time). The Administrative Agent shall distribute such payments to the relevant Lenders
promptly upon receipt in like funds as received. If any payment hereunder (other than payments on
LIBOR Loans) becomes due and payable on a day other than a Business Day, such payment shall be
extended to the next succeeding Business Day and such extension of time shall in such case be
included in the computation of the amount payable hereunder. If any payment on a LIBOR Loan becomes due and payable on a day other than
a Business Day, the maturity thereof shall be extended to the next succeeding Business Day unless
the result of such extension would be to extend such payment into another calendar month, in which
event such payment shall be made on the immediately preceding Business Day.

 

39

     (e) Unless the Administrative Agent shall have been notified in writing by any Lender prior
to a Borrowing Date that such Lender will not make the amount that would constitute its share of
the borrowing on such date available to the Administrative Agent, the Administrative Agent may
assume that such Lender has made such amount available to the Administrative Agent on such
Borrowing Date, and the Administrative Agent may, in reliance upon such assumption, make available
to the Borrower or the relevant Regular Subsidiary Borrower a corresponding amount. If such amount
is made available to the Administrative Agent on a date after such Borrowing Date, such Lender
shall pay to the Administrative Agent on demand an amount equal to the product of (i) the daily
average Federal funds rate (or, in the case of any borrowing in euros or an Optional Currency, the
customary rate as selected by the Administrative Agent for the settlement of obligations between
banks) during such period as quoted by the Administrative Agent, times (ii) the amount of
such Lender’s share of such borrowing, times (iii) a fraction the numerator of which is the
number of days that elapse from and including such Borrowing Date to the date on which such
Lender’s Revolving Percentage or Term Percentage of such borrowing shall have become immediately
available to the Administrative Agent and the denominator of which is 360 (the “Effective
Interbank Rate”). A certificate of the Administrative Agent submitted to any Lender with
respect to any amounts owing under this subsection shall be conclusive in the absence of manifest
error. If such amount is so made available, such payment to the Administrative Agent shall
constitute such Lender’s Loan on such Borrowing Date for all purposes of this Agreement. If such
amount is not so made available to the Administrative Agent, then the Administrative Agent shall
notify the Borrower or the relevant Regular Subsidiary Borrower of such failure and on the fourth
Business Day following such Borrowing Date, the Borrower or such Regular Subsidiary Borrower shall
pay to the Administrative Agent such ratable portion, together with interest thereon for each day
that the Borrower or such Regular Subsidiary Borrower had the use of such ratable portion, at the
Effective Interbank Rate. Nothing contained in this subsection 2.18(e) shall relieve any Lender
which has failed to make available its ratable portion of any borrowing hereunder from its
obligation to do so in accordance with the terms hereof.

     (f) The failure of any Lender to make the Loan to be made by it on any Borrowing Date shall
not relieve any other Lender of its obligation, if any, hereunder to make its Loan on such
Borrowing Date, but no Lender shall be responsible for the failure of any other Lender to make the
Loan to be made by such other Lender on such Borrowing Date.

     2.19 Illegality. Notwithstanding any other provisions herein, if any introduction of or
change in any law, regulation, treaty or directive or in the interpretation or application thereof
occurring after the date hereof shall make it unlawful for any Lender to make or maintain LIBOR
Loans as contemplated by this Agreement, (a) such Lender shall forthwith give telecopy or
telephonic notice of such circumstances, confirmed in writing, to the Borrower or the relevant
Regular Subsidiary Borrower (which notice shall be withdrawn by such Lender when such Lender shall
reasonably determine that it shall no longer be illegal for such Lender to make or maintain LIBOR
Loans or to convert ABR Loans to LIBOR Loans), (b) the commitment of such Lender hereunder to make
LIBOR Loans or to convert ABR Loans to LIBOR Loans shall forthwith be canceled and (c) such
Lender’s Loans then outstanding as LIBOR Loans, if any, shall be, in the case of Loans in Dollars,
converted automatically to ABR Loans based upon the ABR on the last day of the then current
Interest Period with respect to such Loans or within such earlier period as may be required by law
and in the case of Loans in euros or any Optional Currency, shall be prepaid on the last day of the
then current Interest Period with respect to such Loans or within such earlier period as may be
required by law. The Borrower and each Regular Subsidiary Borrower hereby agrees promptly to
pay the Administrative Agent for the account of each Lender, upon demand by the Administrative
Agent, any additional amounts necessary to compensate the Lenders for any costs incurred by the
Lenders in making any conversion in accordance with this subsection 2.19, including, but not
limited to, any interest or fees payable by the Lenders to lenders of funds obtained by them in
order to make or maintain their LIBOR Loans hereunder (the Administrative Agent’s notice of

 

 

40

such
costs, as certified to the Borrower or such Regular Subsidiary Borrower, to be conclusive, absent
manifest error).

     2.20 Requirements of Law.

     (a) In the event that any introduction of or change in any law, regulation, treaty or
directive or in the proper interpretation or application thereof occurring after the date hereof or
compliance by any Lender with any request or directive (whether or not having the force of law)
from any central bank or other governmental authority, agency or instrumentality (including the
National Association of Insurance Commissioners):

     (i) shall subject such Lender to any tax of any kind, whatsoever with respect to this
Agreement, any Letter of Credit, any Application, any Loan or any LIBOR Loans made by it or
its obligation to make LIBOR Loans or change the basis of taxation of payments to such
Lender of principal, commitment fee, interest or any other amount payable hereunder (other
than Non-Excluded Taxes or changes in the rate of tax on the overall net income of such
Lender)

     (ii) shall impose, modify or hold applicable any reserve, special deposit, compulsory
loan or similar requirement against assets held by, or deposits or other liabilities in or
for the account of, advances or loans by, or other credit extended by, or any other
acquisition of funds by, any office of such Lender which are not otherwise included in the
determination of the LIBOR Rate hereunder, or

     (iii) shall impose on such Lender or the eurocurrency market any other condition;

and the result of any of the foregoing is to increase the cost to such Lender (which increase in
cost shall be the result of such Lender’s reasonable allocation of the aggregate of such cost
increases resulting from such events), of making, renewing or maintaining LIBOR Loans or issuing or
participating in Letters of Credit or to reduce any amount receivable thereunder then, in any such
case, the Borrower or the relevant Regular Subsidiary Borrower shall, upon notice to it from such
Lender (with a copy to the Administrative Agent) certifying that (x) one of the events described in
this subsection 2.20(a) has occurred and the nature of such event, (y) the increased cost or
reduced amount resulting from such event and (z) the additional amounts demanded by such Lender and
a reasonably detailed explanation of the calculation thereof, promptly pay to the Administrative
Agent for the account of the applicable Lender, upon demand by the Administrative Agent, without
duplication, any additional amounts necessary to compensate such Lender for such increased cost or
reduced amount receivable which such Lender deems to be material as determined in good faith by
such Lender with respect to this Agreement or the Loans made hereunder, provided that, in
any such case, the Borrower or the relevant Regular Subsidiary Borrower (if otherwise not
prohibited hereunder) may elect to convert the LIBOR Loans in Dollars made hereunder to ABR Loans
by giving such Lender and the Administrative Agent at least one Business Day’s prior irrevocable
notice of such election in which case the Borrower or relevant Regular Subsidiary Borrower shall
promptly pay the Administrative Agent for the account of the applicable Lender, upon demand by the
Administrative Agent, without duplication, any loss or expense incurred by such Lender in
liquidating or re-employing the deposits from which the funds were obtained by such Lender for the purpose of
making and/or maintaining such LIBOR Loans, together with any amount due under this subsection
2.20(a) in respect of the period prior to such conversion. If such Lender becomes entitled to
claim any additional amounts pursuant to this subsection, it shall promptly notify the Borrower or
the relevant Regular Subsidiary Borrower of the event by reason of which it has become so entitled.

 

 

41

     (b) In the event that any Lender shall have determined that any change in any Requirement of
Law regarding capital adequacy or in the interpretation or application thereof or compliance by
such Lender or any corporation controlling such Lender with any request or directive regarding
capital adequacy (whether or not having the force of law) from any Governmental Authority made
subsequent to the date hereof does or shall have the effect of reducing the rate of return on such
Lender’s or such corporation’s capital as a consequence of its obligations hereunder or under any
Letters of Credit to a level below that which such Lender or such corporation could have achieved
but for such change or compliance (taking into consideration such Lender’s or such corporation’s
policies with respect to capital adequacy) by an amount deemed by such Lender to be material, then
from time to time, within 15 days after submission by such Lender to the Borrower (with a copy to
the Administrative Agent) of a written request therefor certifying that (x) one of the events
described in this subsection 2.20(b) has occurred and the nature of such event, (y) the increased
cost or reduced amount resulting from such event and (z) the additional amounts demanded by such
Lender and a reasonably detailed explanation of the calculation thereof, the Borrower shall pay to
such Lender such additional amount or amounts as will compensate such Lender for such reduction.

     (c) A certificate as to any additional amounts payable pursuant to paragraphs (a) and (b)
above submitted by any Lender to the Borrower or a Regular Subsidiary Borrower shall be conclusive
absent manifest error.

     2.21 Indemnity. The Borrower and each Regular Subsidiary Borrower agrees to indemnify each
Lender and to hold each Lender harmless from any loss or expense which such Lender may sustain or
incur as a consequence of (a) default by the Borrower or such Regular Subsidiary Borrower in
payment of the principal amount of or interest on any LIBOR Loans including, but not limited to,
any such loss or expense arising from interest or fees payable by such Lender to lenders of funds
obtained by them in order to maintain their LIBOR Loans, (b) default by the Borrower or such
Regular Subsidiary Borrower in making LIBOR Loans or conversion after the Borrower or such Regular
Subsidiary Borrower has given a notice in accordance with subsection 2.5 or 2.14, (c) default by
the Borrower or such Regular Subsidiary Borrower in making any prepayment of a LIBOR Loan after the
Borrower or such Regular Subsidiary Borrower has given a notice in accordance with subsection
2.11(a), and (d) the making of any payment or conversion of LIBOR Loans on a day which is not the
last day of the applicable Interest Period with respect thereto, including, but not limited to, any
such loss or expense arising from interest or fees payable by the Lenders to lenders of funds
obtained by them in order to maintain their LIBOR Loans hereunder. This covenant shall survive
termination of this Agreement and payment of the outstanding Notes. The obligations of indemnity
of each of the respective Regular Subsidiary Borrowers hereunder are limited only to the loss and
expense described herein arising from or as a result of any act or omission by such Regular
Subsidiary Borrower, and are not, and shall not be deemed to be, the joint and several obligations
of each such Regular Subsidiary Borrower as to any loss or expense arising from or as a result of
any act or omission by the Borrower or the other Regular Subsidiary Borrower.

     2.22 Taxes.

     (a) Except as provided below in this subsection or in any Annex hereto, all payments made by
the Borrower or any Subsidiary Borrower under this Agreement shall be made free and clear of, and
without deduction or withholding for or on account of, any present or future income, stamp or other
taxes, levies, imposts, duties, charges, fees, deductions or withholdings, now or hereafter
imposed, levied, collected, withheld or assessed by any Governmental Authority, excluding the
following taxes (“Excluded Taxes”) (x) taxes measured by or imposed upon the overall net
income of any Lender or its applicable lending office, or any branch or affiliate thereof, and (y)
all franchise taxes or branch taxes imposed upon any Lender or its applicable lending office, or
any branch or affiliate thereof, in each case imposed: (i) by

 

 

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the jurisdiction under the laws of
which such Lender, applicable lending office, branch or affiliate is organized or is located, or in
which its principal executive office is located, or any nation within which such jurisdiction is
located or any political subdivision thereof; or (ii) by reason of any connection between the
jurisdiction imposing such tax and such Lender, applicable lending office, branch or affiliate
other than a connection arising solely from such Lender having executed, delivered or performed its
obligations under, or received payment under or enforced, this Agreement. If any such non-excluded
taxes, levies, imposts, duties, charges, fees, deductions or withholdings (“Non-Excluded
Taxes”) are required to be withheld from any amounts payable to the Administrative Agent or any
Lender hereunder, the amounts so payable to the Administrative Agent or such Lender shall be
increased to the extent necessary to yield to the Administrative Agent or such Lender (after
payment of all Non-Excluded Taxes) interest or any such other amounts payable hereunder at the
rates or in the amounts specified in this Agreement, provided, however, that the Borrower and/or
such Subsidiary Borrower shall be entitled to deduct and withhold any Non-Excluded Taxes and shall
not be required to increase any such amounts payable to any Lender that are attributable to (i)
such Lender’s failure to comply with the requirements of paragraph (b) of this subsection or (ii)
the Lender’s failure at all times during which it is a party to this Agreement to comply with the
requirements of subsection 2.1, 2.4 or 2.6 unless such failure is due to a change in treaty, law or
regulation or any application or interpretation thereof. Whenever any Non-Excluded Taxes are
payable by the Borrower or any Subsidiary Borrower, as promptly as possible thereafter the
applicable Borrower or Subsidiary Borrower shall send to the Administrative Agent for its own
account or for the account of such Lender, as the case may be, a certified copy of an original
official receipt received by such Borrower or such Subsidiary Borrower showing payment thereof. If
the Borrower or any Subsidiary Borrower fails to pay any Non-Excluded Taxes when due to the
appropriate taxing authority or fails to remit to the Administrative Agent the required receipts or
other required documentary evidence, such Borrower or Subsidiary Borrower shall indemnify the
Administrative Agent and the Lenders for any incremental taxes, interest or penalties that may
become payable by the Administrative Agent or any Lender as a result of any such failure. The
agreements in this subsection shall survive the termination of this Agreement and the payment of
the Loans and all other amounts payable hereunder.

     (b) (1) Each Lender that is not incorporated under the laws of the United States of America
or a state thereof shall:

     (X) (i) on or before the date of any payment by the Borrower or any Regular Subsidiary
Borrower under this Agreement or any Notes to such Lender, deliver to the Borrower and the
Administrative Agent two duly completed copies of United States Internal Revenue Service
Form W-8BEN or W-8ECI, as applicable, or such successor applicable form, statement or
certificate, as the case may be, certifying that it is entitled to an exemption from United
States backup withholding tax or is entitled receive payments under this Agreement and any
Notes without deduction or withholding (or, upon the prior written consent of the Borrower,
at a reduced rate of withholding) of any United States federal income taxes;

            (ii) deliver to the Borrower and the Administrative Agent two further copies of any
such form or certification on or before the date that any such form or certification expires
or becomes obsolete and after the occurrence of any event requiring a change in the most
recent form previously delivered by it to the Borrower or such Domestic Subsidiary Borrower;
and

            (iii) obtain such extensions of time for filing and complete such forms or
certifications as may reasonably be requested by the Borrower or the Administrative Agent;

     (Y) in the case of any such Lender that is not a “bank” within the meaning of Section
881(c)(3)(A) of the Code, (i) represent to the Borrower (for the benefit of each of the
Borrower,

 

 

43

the relevant Subsidiary Borrowers and the Administrative Agent) that it is not a
bank within the meaning of Section 881(c)(3)(A) of the Code, (ii) agree to furnish to the
Borrower on or before the date of any payment by the Borrower or any Domestic Subsidiary
Borrower, with a copy to the Administrative Agent, (A) a certificate substantially in the
form of Exhibit D (any such certificate a “U.S. Tax Compliance Certificate”) and (B)
two accurate and complete original signed copies of Internal Revenue Service Form W-8 BEN or
W-8 ECI, as applicable, or successor applicable form certifying to such Lender’s legal
entitlement at the date of such certificate to an exemption from U.S. withholding tax under
the provisions of Sections 871(h), 881(c) and 1441(c)(9) of the Code with respect to
payments to be made under this Agreement and any Notes (and to deliver to the Borrower and
the Administrative Agent two further copies of such form on or before the date it expires or
becomes obsolete and after the occurrence of any event requiring a change in the most
recently provided form and, if necessary, obtain any extensions of time reasonably requested
by the Borrower or the Administrative Agent for filing and completing such forms), and (iii)
agree, to the extent legally entitled to do so, upon reasonable request by the Borrower, to
provide to the Borrower (for the benefit of each of the Borrower, the Regular Subsidiary
Borrowers and the Administrative Agent) such other forms as may be reasonably required in
order to establish the legal entitlement of such lender to an exemption from withholding
with respect to payments under this Agreement and any Notes, provided that in determining
the reasonableness of a request under this clause (iii) such Lender shall be entitled to
consider the cost (to the extent unreimbursed by the Borrower) which would be imposed on
such Lender of complying with such request;

unless in any such case any change in treaty, law or regulation has occurred after the date such
Person becomes a Lender hereunder which renders all such forms inapplicable or which would prevent
such Lender from duly completing and delivering any such form with respect to it and such Lender so
advises the Borrower and the Administrative Agent.

          (2) Each Lender that is not incorporated or organized under the laws of the jurisdiction
under which a Foreign Subsidiary Borrower is incorporated or organized or is not a resident for
taxation purposes of such Foreign Subsidiary Borrower’s country of tax residence, shall upon
written request by such Foreign Subsidiary Borrower, deliver to such Foreign Subsidiary Borrower or
the applicable Governmental Authority or taxing authority, as the case may be, any form or
certificate required in order that any payment by such Foreign Subsidiary Borrower under this
Agreement or any Notes to such Lender may be made free and clear of, and without deduction or
withholding for or on account of any tax (or upon the prior written consent of the Borrower, to
allow any such deduction or withholding to be at a reduced rate) imposed on such payment under the
laws of the jurisdiction under which such Foreign Subsidiary Borrower is incorporated or organized
or is otherwise a resident for taxation purposes, provided that such Lender is legally
entitled to complete, execute and deliver such form or certificate and such completion, execution
or submission would not materially prejudice the legal position of such Lender.

          2.23 Use of Proceeds. The proceeds of the Loans shall be used (i) to finance all or a portion of the Transactions
and to pay related fees and expenses and (ii) for working capital and other general corporate
purposes of the Borrower and its Subsidiaries (which shall include any use not expressly prohibited
by the terms of this Agreement); provided that, notwithstanding the foregoing, none of the
proceeds of the Loans may be used to finance any Hostile Take-Over Bid.

          2.24 Controls on Prepayment if Aggregate Revolving Extensions of Credit Exceed Aggregate
Revolving Credit Commitments.

 

 

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     (a) The Borrower will implement and maintain internal controls to monitor the borrowings and
repayments of Revolving Credit Loans by both the Borrower and the relevant Regular Subsidiary
Borrowers and the issuance of and drawings under Letters of Credit, with the object of preventing
any request for an Extension of Credit that would result in the Available Facility A-1 Commitments,
the Available Facility B Commitments the Available Facility C Commitments or the Available Facility
D Commitments becoming negative by more than 5% of the Revolving Credit Commitments under the
relevant Revolving Facility, and, if such Commitments are negative by more than 5%, the Borrower
will promptly notify the Administrative Agent.

     (b) The Administrative Agent will calculate the Available Facility A-1 Commitments, the
Available Facility A-2 Commitments, the Available Facility B Commitments the Available Facility C
Commitments or the Available Facility D Commitments from time to time, and in any event not less
frequently than once during each calendar quarter. In making such calculations, the Administrative
Agent will rely on the information most recently received by it from the Swing Line Lenders in
respect of outstanding Swing Line Loans and from the Issuing Lenders in respect of outstanding L/C
Obligations.

     (c) In the event that on any date the Administrative Agent calculates that the Available
Facility A-1 Commitments, the Available Facility B Commitments the Available Facility C Commitments
or the Available Facility D Commitments have become negative solely as a result of a change in the
aggregate Dollar Equivalent of the Revolving Credit Loans under such Revolving Facility in euros or
in Optional Currencies, by more than 5%, the Administrative Agent will give notice to such effect
to the Borrower or any such Regular Subsidiary Borrower and the Lenders. Within five Business Days
of receipt of any such notice, the Borrower or any such Regular Subsidiary Borrower will, as soon
as practicable but in any event within five Business Days of receipt of such notice, first,
make such repayments or prepayments of Revolving Credit Loans under the relevant Revolving Facility
(together with interest accrued to the date of such repayment or prepayment), second, pay
any Reimbursement Obligations under such Revolving Facility then outstanding and, third,
cash collateralize any outstanding L/C Obligations under such Revolving Facility on terms
reasonably satisfactory to the Administrative Agent as shall be necessary to cause the Available
Facility A-1 Commitments, the Available Facility B Commitments the Available Facility C Commitments
or the Available Facility D Commitments, as applicable, not to be negative. If any such repayment
or prepayment of a LIBOR Loan pursuant to this subsection occurs on a day which is not the last day
of the then current Interest Period with respect thereto, the Borrower shall pay to the Lenders
such amounts, if any, as may be required pursuant to subsection 2.21.

     2.25 Lending Installations.

     (a) Subject to subsection 2.1, 2.4 and 2.6 each Lender may book its Loans at any Lending
Installation selected by such Lender and may change its Lending Installation from time to time,
provided that (i) in the case of a Facility C Lender, that Lending Installation is an
Eligible Australian Bank and (ii) in the case of a Facility D Lender, that Lending Installation is
an Eligible Canadian Bank. All terms of this Agreement shall apply to any such Lending
Installation and the Loans made hereunder shall be deemed held by each Lender for the benefit of
such Lending Installation. Each Lender may, by written notice to the Administrative Agent and the
Borrower in accordance with subsection 10.2 and subject always to subsection 2.1, 2.4 and 2.6
designate replacement or additional Lending Installations through which Loans will be made by it
and for whose account Loan payments are to be made.

     (b) Each Lender agrees that, upon the occurrence of any event giving rise to the operation of
subsection 2.20 or 2.22(a) with respect to such Lender, it will, if requested by the Borrower, use
reasonable efforts (subject to overall policy considerations of such Lender) to designate another
Lending Installation for any Loans affected by such event with the object of avoiding the
consequences of

 

 

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such event; provided, that such designation is made on terms that, in the
sole judgment of such Lender, cause such Lender and any of its Lending Installations to suffer no
economic, legal or regulatory disadvantage, and provided, further, that nothing in
this subsection 2.25(b) shall affect or postpone any of the obligations of the Borrower or any
Regular Subsidiary Borrower or the rights of any Lender pursuant to subsection 2.20 or 2.22(a).

     2.26 Notices to Lenders. All notices under this Section 2 to Lenders by the Borrower, any
Regular Subsidiary Borrower or the Administrative Agent, and all payments by the Administrative
Agent to the Lenders, shall be made to the respective Lending Installations of the Lenders
maintaining the relevant Loans or Commitments.

     2.27 Incremental Term Facilities; Revolving Credit Commitment Increases and Changes;
Incremental Term Loans.

     (a) The Borrower may at any time and from time to time after the Closing Date, by notice to
the Administrative Agent (whereupon the Administrative Agent shall promptly deliver a copy to each
of the Lenders), request (a) one or more additional tranches of term loans (the “Incremental
Term Loans”) or (b) one or more increases in the amount of the Revolving Credit Commitments
(each such increase, a “Revolving Credit Commitment Increase”), provided that (i)
both at the time of any such request and upon the effectiveness of any Incremental Commitment
Supplement referred to below, no Default or Event of Default shall exist and at the time that any
such Incremental Term Loan is made (and after giving effect thereto) no Default or Event of Default
shall exist and (ii) the Borrower shall be in compliance with each of the covenants set forth in
subsections 6.9 and 6.10 determined on a pro forma basis as of the date of such
Incremental Term Loan or Revolving Credit Commitment Increase and the last day of the most recent
fiscal period of the Borrower for which financial statements have been provided, in each case, as
if such Incremental Term Loans or Revolving Credit Commitment Increases, as applicable, had been
outstanding on the last day of such fiscal quarter of the Borrower for testing compliance therewith
and after giving effect to the use of the proceeds thereof. Each tranche of Incremental Term Loans
and each Revolving Credit Commitment Increase shall be in an aggregate principal amount that is not
less than $25,000,000 (provided that such amount may be less than $25,000,000 if such
amount represents all remaining availability under the limit set forth in paragraph (e) below).
The Incremental Term Loans (a) shall rank pari passu in right of payment and of security with the
Revolving Credit Loans and the Term Loan, (b) shall mature concurrently with the Term Loan, (c)
shall have a weighted average life to maturity consistent with the weighted average life to
maturity of the Term Loan as of the date such Incremental Term Loan is made and (d) except as set
forth below, shall be treated substantially the same as the Term Loan (including with respect to
mandatory and optional prepayments and scheduled amortization), provided that the interest
rates applicable to the Incremental Term Loans shall be determined by the Borrower and the lenders
thereof. Each notice from the Borrower pursuant to this subsection shall set forth the requested
amount and proposed terms of the relevant Incremental Term Loans or Revolving Credit Commitment
Increases. Incremental Term Loans may be made, and Revolving Credit Commitment Increases may be
provided, by any existing Lender or by any other bank or other financial institution (any such
other bank or other financial institution being called a “New Lender”); provided
that the Administrative Agent shall have consented (such consent not to be unreasonably withheld)
to such Lender or New Lender making such Incremental Term Loans or providing such Revolving Credit
Commitment Increases if such consent would be required under subsection 10.6 for an assignment of
Loans or Revolving Credit Commitments, as applicable, to such Lender or New Lender. Commitments in
respect of Incremental Term Loans and Revolving Credit Commitment Increases shall become
Commitments (or in the case of a Revolving Credit Commitment Increase to be provided by an existing
Revolving Credit Lender, an increase in such Lender’s applicable Revolving Credit Commitment) under
this Agreement pursuant to an amendment (an “Incremental Commitment Supplement”)
substantially in the Form of Exhibit E to this Agreement and, as appropriate,

 

 

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the other Loan
Documents, executed by the Borrower, the Regular Subsidiary Borrowers (if applicable), each Lender
agreeing to provide such Commitment, if any, each New Lender, if any, and the Administrative Agent.
An Incremental Commitment Supplement may, without the consent of any other Lenders, effect such
amendments to this Agreement and the other Loan Documents as may be necessary or appropriate, in
the reasonable opinion of the Administrative Agent and the Borrower, to effect the provisions of
this subsection. .

     (b) At the request of the Borrower and with the consent of the Administrative Agent (which
consent shall not be unreasonably withheld), a Revolving Credit Lender may from time to time either
(i) increase (including from zero) its Facility A-1 Commitment, Facility A-2 Commitment, Facility B
Commitment, Facility C Commitment or Facility D Commitment (with a concomitant increase as
appropriate in its Sterling Commitment, Canadian Commitment or Australian Commitment) or (ii)
establish a new Revolving Facility (such as a “Facility E” or “Facility F”) and a related local
facility with a commitment thereunder and, in either case, equivalently reduce its commitment under
Facility A-1, Facility A-2, Facility B, Facility C or Facility D (with a concomitant reduction as
appropriate in its Sterling Commitment, Canadian Commitment or Australian Commitment). Any such
increase or establishment and equivalent reduction shall be evidenced by the execution and delivery
by the Borrower, the Subsidiary Borrowers, the Administrative Agent and such Revolving Credit
Lenders of documentation satisfactory to such parties providing for such increase, transfer or
establishment and equivalent reduction and any amendments to this Section 2 and to the relevant
annexes hereto (including the inclusion of a new annex) as are necessary or appropriate to afford
such parties with the benefits of this Agreement and the rights and remedies hereunder for such
increase or such new Revolving Facility and any related local facility as are comparable to the
benefits hereof and the rights and remedies hereunder for the existing Revolving Facilities.

     (c) If, on the date upon which the Revolving Credit Commitment of any Revolving Credit Lender
under any Revolving Facility is increased pursuant to subsection 2.27(a) or there is an increase in
or establishment of a Revolving Facility and an equivalent reduction in any other Revolving
Facility pursuant to subsection 2.27(b), there is an unpaid principal amount of Revolving Credit
Loans under any Revolving Facility affected thereby the Borrower or any Regular Subsidiary Borrower
in which such Revolving Credit Lender has agreed to participate, the principal outstanding amount
of all such Revolving Credit Loans shall (A) in the case of such Revolving Credit Loans which are
ABR Loans, be immediately prepaid by the Borrower or Subsidiary Borrower (but all such Revolving
Credit Loans may, on the terms and conditions hereof, be reborrowed on such date on a ratable basis, based on
the revised Revolving Credit Commitments as then in effect under the relevant Revolving Facilities)
and (B) in the case of such Revolving Credit Loans which are LIBOR Loans, continue to remain
outstanding (notwithstanding any other requirement in this Agreement that such Revolving Credit
Loans be held ratably based on the revised Commitments under the relevant Revolving Facilities as
then in effect) until the end of the then current Interest Period therefor, at which time such
LIBOR Loans shall be paid by the Borrower or Subsidiary Borrower (but all such Revolving Credit
Loans may, on the terms and conditions hereof, be reborrowed on such date on a ratable basis, based
on the Revolving Facilities as then in effect).

     (d) The effectiveness of any Incremental Term Loans or increase or new Revolving Facilities
permitted by this subsection 2.27 shall be subject to the satisfaction of each of the conditions
set forth in subsection 5.2 and such other conditions as the Borrower and the other parties thereto
shall agree.

     (e) Notwithstanding anything to the contrary in this subsection 2.27, (i) in no event shall
the sum of the Incremental Term Loans and Revolving Credit Commitment Increases exceed $200,000,000
in the aggregate (net of any Revolving Credit Commitment Increases or other increases that are
consummated in connection with an accompanying optional reduction of the Revolving Credit
Commitments in accordance with subsection 2.10(a), which increases shall be separate and
disregarded in

 

 

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the calculation of such $200,000,000 maximum permitted amount) and (ii) no Lender
shall have any obligation to make an Incremental Term Loan, increase its Revolving Credit
Commitment under any Revolving Facility or provide a commitment under any new Revolving Facility
unless it agrees to do so in its sole discretion. Each Incremental Commitment Supplement shall be
deemed to be a supplement to this Agreement.

     SECTION 3. LETTER OF CREDIT FACILITIES

     3.1
L/C Commitment.

     (a) Subject to the terms and conditions hereof, the Issuing Lender, in reliance on the
agreements of the other Lenders set forth in subsection 3.4(a), agrees to issue letters of credit
(“Letters of Credit”) under any Revolving Facility for the account of the Borrower or any
Regular Subsidiary Borrower on any Business Day during the Revolving Credit Commitment Period in
such form as may be approved from time to time by the Issuing Lender; provided that the Issuing
Lender shall not have any obligation to issue any Letter of Credit if, after giving effect to such
issuance, (i) the L/C Obligations would exceed the L/C Commitment or (ii) the Available Facility
A-1 Commitments, the Available Facility A-2 Commitments, the Available Facility B Commitments the
Available Facility C Commitments or the Available Facility D Commitments would be negative. Each
Letter of Credit shall (i) be denominated in Dollars, euros or in any Optional Currency, (ii) be
either (x) a standby letter of credit (a “Standby L/C”) issued to support obligations of
the Borrower or any Regular Subsidiary Borrower, contingent or otherwise, with an expiry date
occurring not later than one year after such standby L/C was issued (which expiry date may be
subject to one or more automatic extensions of one year or less unless 60-day notice, or such other
notice as is satisfactory to the Borrower and the Issuing Lender, is given that any such extension
shall not be effective) or (y) a documentary letter of credit in respect of the purchase of goods
or services by the Borrower and its Subsidiaries in the ordinary course of business with an expiry
date occurring not later than one year after such documentary letter of credit was issued and, in
the case of any such documentary letter of credit which is to be accepted by the Issuing Lender
pending payment at a date after presentation of sight drafts, with a payment date no more than one
year after such
drafts were presented for acceptance (a “Trade L/C”) and (iii) expire no later than
five days before the Revolving Credit Termination Date.

     (b) Each Standby L/C shall be subject to the International Standby Practices and each Trade
L/C shall be subject to the Uniform Customs and, in each case, to the extent not inconsistent
therewith, the laws of the State of New York.

     (c) The Issuing Lender shall at no time be obligated to issue any Letter of Credit hereunder
if such issuance would conflict with, or cause the Issuing Lender or any L/C Participant to exceed
any limits imposed by, any applicable Requirement of Law.

     (d) Notwithstanding anything to the contrary contained herein, each Letter of Credit
outstanding under the Existing Credit Agreement on the Closing Date shall be deemed to be issued
and outstanding under this Agreement as of the Closing Date.

     3.2 Procedure for Issuance of Letters of Credit. The Borrower or any Regular Subsidiary
Borrower may from time to time request that the Issuing Lender issue a Letter of Credit under any
Revolving Facility by delivering to the Issuing Lender (with a copy to the Administrative Agent) at
its address for notices specified herein an Application therefor, completed to the satisfaction of
the Issuing Lender, and such other certificates, documents and other papers and information as the
Issuing Lender may reasonably request. Upon receipt of any Application, the Issuing Lender will
process such

 

 

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Application and the certificates, documents and other papers and information delivered
to it in connection therewith in accordance with its customary procedures and shall promptly issue
the Letter of Credit requested thereby (but in no event shall the Issuing Lender be required to
issue any Letter of Credit earlier than four Business Days after its receipt of the Application
therefor and all such other certificates, documents and other papers and information relating
thereto) by issuing the original of such Letter of Credit to the beneficiary thereof or as
otherwise may be agreed by the Issuing Lender and the Borrower or any relevant Regular Subsidiary
Borrower. The Issuing Lender shall furnish a copy of such Letter of Credit to the Borrower, to the
Administrative Agent and to any relevant Regular Subsidiary Borrower promptly following the
issuance thereof.

     3.3 Fees, Commissions and Other Charges.

     (a) The Borrower or the relevant Regular Subsidiary Borrower shall pay to the Administrative
Agent, for the ratable account of the Issuing Lender and the L/C Participants under the relevant
Revolving Facility, a letter of credit commission in Dollars with respect to each Letter of Credit
issued by the Issuing Lender (i) in an amount equal to the Dollar Equivalent of such issuance and
payment fees as have been agreed upon by the Borrower and the Issuing Lender and (ii) in an amount
equal to the product of, on the date on which such commission is calculated, (A) the rate per annum
equal to the Applicable Margin in respect of LIBOR Loans that are Revolving Credit Loans and (B)
the Dollar Equivalent of the aggregate amount available to be drawn under each Letter of Credit
(plus an additional 1/8 of 1% per annum which shall be payable for the account of the Issuing
Lender). Such letter of credit commissions shall be payable in arrears on the last day of each
March, June, September and December and shall be nonrefundable.

     (b) In addition to the foregoing fees and commissions, the Borrower or the relevant Regular
Subsidiary Borrower shall pay or reimburse the Issuing Lender for such normal and customary
costs and expenses as are incurred or charged by the Issuing Lender in issuing, effecting
payment under, amending or otherwise administering any Letter of Credit issued by it.

     (c) The Administrative Agent shall, promptly following its receipt thereof, distribute to the
Issuing Lender and the L/C Participants under the relevant Revolving Facility all fees and
commissions received by the Administrative Agent for their respective accounts pursuant to this
subsection 3.3.

     3.4 L/C Participation.

     (a) The Issuing Lender irrevocably agrees to grant and hereby grants to each L/C Participant
under the relevant Revolving Facility, and, to induce the Issuing Lender to issue Letters of Credit
hereunder, each such L/C Participant irrevocably agrees to accept and purchase and hereby accepts
and purchases from the Issuing Lender, on the terms and conditions hereinafter stated, for such L/C
Participant’s own account and risk an undivided interest equal to such L/C Participant’s ratable
share of the Revolving Facility under which such Letter of Credit is to be issued in the Issuing
Lender’s obligations and rights under each Letter of Credit issued hereunder under such Revolving
Facility and the amount of each draft paid by the Issuing Lender thereunder. Each such L/C
Participant unconditionally and irrevocably agrees with the Issuing Lender that, if a draft is paid
under any such Letter of Credit for which the Issuing Lender is not reimbursed in full by the
Borrower or the relevant Regular Subsidiary Borrower in accordance with the terms of this
Agreement, such L/C Participant shall pay to the Issuing Lender upon demand at the Issuing Lender’s
address for notices specified herein an amount equal to such L/C Participant’s ratable share of the
Revolving Facility under which such Letter of Credit was issued of the amount of such draft, or any
part thereof, which is not so reimbursed.

 

 

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     (b) If any amount required to be paid by any L/C Participant under any Revolving Facility to
the Issuing Lender pursuant to subsection 3.4(a) in respect of any unreimbursed portion of any
payment made by the Issuing Lender under any Letter of Credit issued under such Revolving Facility
is not paid to the Issuing Lender within three Business Days after the date such payment is due,
such L/C Participant shall pay to the Issuing Lender on demand an amount equal to the product of
(i) such amount, times (ii) the daily average Federal funds rate, as quoted by the Issuing
Lender, during the period from and including the date such payment is required to the date on which
such payment is immediately available to the Issuing Lender, times (iii) a fraction the
numerator of which is the number of days that elapse during such period and the denominator of
which is 360. If any such amount required to be paid by any such L/C Participant pursuant to
subsection 3.4(a) is not in fact made available to the Issuing Lender by such L/C Participant
within three Business Days after the date such payment is due, the Issuing Lender shall be entitled
to recover from such L/C Participant, on demand, such amount with interest thereon calculated from
such due date at the rate per annum applicable to ABR Loans that are Revolving Credit Loans
hereunder. A certificate of the Issuing Lender submitted to any L/C Participant with respect to
any amounts owing under this subsection shall be conclusive in the absence of manifest error.

     (c) Whenever, at any time after the Issuing Lender has made payment under any Letter of
Credit issued under any Revolving Facility and has received from any L/C Participant its ratable
share of such payment in accordance with subsection 3.4(a), the Issuing Lender receives any payment
related to such Letter of Credit (whether directly from the Borrower, the relevant Regular
Subsidiary Borrower or otherwise), or any payment of interest on account thereof, the Issuing
Lender will distribute to such L/C Participant its ratable share thereof; provided,
however, that in the event that any such payment received by the Issuing Lender shall be
required to be returned by the Issuing Lender, such L/C Participant shall return to the Issuing
Lender the portion thereof previously distributed by the Issuing Lender to it.

     3.5 Reimbursement Obligation of the Borrower. The Borrower or the relevant Regular
Subsidiary Borrower agrees to reimburse the Issuing Lender on each date on which the Issuing Lender
notifies the Borrower or the relevant Regular Subsidiary Borrower of the date and amount of a draft
presented under any Letter of Credit and paid by the Issuing Lender for the amount of (a) such
draft so paid and (b) any taxes (other than Excluded Taxes), fees, charges or other costs or
expenses incurred by the Issuing Lender in connection with such payment; provided that upon
the acceleration of such reimbursement obligations in accordance with Section 8, the Borrower or
the relevant Regular Subsidiary Borrower agrees to reimburse the Issuing Lender for the amount
equal to the then maximum liability (whether direct or contingent) of the Issuing Lender and the
L/C Participants under such Letter of Credit. Each such payment shall be made to the Issuing
Lender, at its address for notices specified herein in the currency in which such Letter of Credit
is denominated (except that, in the case of any Letter of Credit denominated in euros or any
Optional Currency, in the event that such payment is not made to the Issuing Lender within three
Business Days of the date of receipt by the Borrower or any relevant Regular Subsidiary Borrower of
such notice, upon notice by the Issuing Lender to the Borrower or the relevant Regular Subsidiary
Borrower, such payment shall be made in Dollars, in an amount equal to the Dollar Equivalent of the
amount of such payment converted on the date of such notice into Dollars at the spot rate of
exchange on such date) and in immediately available funds, on the date on which the Borrower or any
relevant Regular Subsidiary Borrower (on behalf of itself or such Regular Subsidiary Borrower, as
the case may be) receives such notice, if received prior to 10:00 A.M., New York City time, on a
Business Day and otherwise on the next succeeding Business Day. Any conversion by the Issuing
Lender of any payment to be made by the Borrower or any Regular Subsidiary Borrower in respect of
any Letter of Credit denominated in euros or any Optional Currency into Dollars in accordance with
this subsection 3.5 shall be conclusive and binding upon such Borrower or such relevant Regular
Subsidiary Borrower and the Lenders in the absence of manifest error; provided that upon
the request of any Lender, the Issuing Lender shall provide to such Lender a certificate including
reasonably detailed information as to the calculation of such conversion.

 

 

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     3.6 Obligations Absolute. The Borrower’s and any relevant Regular Subsidiary Borrower’s
obligations under this Section 3 shall be absolute and unconditional under any and all
circumstances and irrespective of any set-off, counterclaim or defense to payment which the
Borrower or any relevant Regular Subsidiary Borrower may have or have had against the Issuing
Lender or any beneficiary of a Letter of Credit. The Borrower also agrees with the Issuing Lender
that the Issuing Lender shall not be responsible for, and the Borrower’s or such relevant Regular
Subsidiary Borrower’s Reimbursement Obligations under subsection 3.5 shall not be affected by,
among other things, the validity or genuineness of documents or of any endorsements thereon, even
though such documents shall in fact prove to be invalid, fraudulent or forged, or any dispute
between or among the Borrower, any relevant Regular Subsidiary Borrower and any beneficiary of any
Letter of Credit or any other party to which such Letter of Credit may be transferred or any claims
whatsoever of the Borrower or relevant Regular Subsidiary Borrower against any beneficiary of such
Letter of Credit or any such transferee. The Issuing Lender shall not be liable for any error,
omission, interruption or delay in transmission, dispatch or delivery of any message or advice,
however transmitted, in connection with any Letter of Credit issued by it, except for errors or
omissions caused by the Issuing Lender’s gross negligence or willful misconduct. The Borrower and
any relevant Regular Subsidiary Borrower agrees that any action taken or omitted by the Issuing
Lender under or in connection with any Letter of Credit issued by it or the related drafts or
documents, if done in the absence of gross negligence or willful misconduct and in accordance with
the standards of care specified in the Uniform Commercial Code of the State of New York, shall be
binding on the Borrower or any relevant Regular Subsidiary Borrower and shall not result in any
liability of the Issuing Lender to the Borrower or any relevant Regular Subsidiary Borrower.

     3.7 Increased Costs. If the adoption of or any change in any law or regulation or in the
interpretation thereof after the date hereof by any court or administrative or Governmental
Authority charged with the administration thereof shall either (i) impose, modify or deem
applicable any reserve, special deposit or similar requirement against Letters of Credit issued by
the Issuing Lender or participated in by the Lenders or (ii) impose on any Lender any other
condition regarding any Letter of Credit, and the result of any event referred to in clauses (i) or
(ii) above shall be to increase the cost to the Issuing Lender or any Lender of issuing or
maintaining such Letter of Credit (or its participation therein, as the case may be) (which
increase in cost shall be the result of the Issuing Lender’s or such Lender’s reasonable allocation
of the aggregate of such cost increases resulting from such events), then, upon notice to it from
the Issuing Lender or such Lender (with a copy to the Administrative Agent) certifying that (x) one
of the events herein above described has occurred and the nature of such event, (y) the increased
cost or reduced amount resulting from such event and (z) the additional amounts demanded by the
Issuing Lender or such Lender, as the case may be, and a reasonably detailed explanation of the
calculation thereof, the Borrower shall immediately pay to such Issuing Lender or such Lender, as
the case may be, from time to time as specified by the Administrative Agent or such Lender,
additional amounts which shall be sufficient to compensate such Issuing Lender or such Lender for
such increased cost, together with interest on each such amount from the date demanded until
payment in full thereof at the rate provided in subsection 3.3. A certificate as to the fact and
amount of such increased cost incurred by the Issuing Lender or such Lender as a result of any
event mentioned in clauses (i) or (ii) above, submitted by the Issuing Lender or such Lender to the
Borrower, shall be conclusive, absent manifest error.

     3.8 Letter of Credit Payments. If any draft in Dollars, euros or in any Optional Currency
shall be presented for payment under any Letter of Credit, the Issuing Lender shall promptly notify
the Borrower and the Administrative Agent of the date and amount of the Dollars, euros or the
Optional Currency thereof. The responsibility of the Issuing Lender to the Borrower in connection
with any draft presented for payment under any Letter of Credit shall, in addition to any payment
obligation expressly provided for in such Letter of Credit, be limited to determining that the
documents (including each draft)

 

 

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delivered under such Letter of Credit in connection with such
presentment are in conformity with such Letter of Credit.

     (a) Application. To the extent that any provision of any Application related to
any Letter of Credit is inconsistent with the provisions of this Agreement, the provisions
of this Agreement shall apply.

     (b) Purpose of the Letters of Credit. The Letters of Credit shall be used for any
lawful purposes requested by the Borrower or any Regular Subsidiary Borrower.

          SECTION 4. REPRESENTATIONS AND WARRANTIES

          In order to induce the Lenders and the Administrative Agent to enter into this Agreement and
to make the Loans and issue or participate in the Letters of Credit herein provided for, the
Borrower hereby represents and warrants to the Administrative Agent and to each Lender that:

          4.1 Financial Condition.

          (a) The unaudited pro forma consolidated balance sheet of the Borrower and
its consolidated Subsidiaries as at September 30, 2006 (including the notes thereto) (the “Pro
Forma Balance Sheet”), copies of which have heretofore been furnished to each Lender, has been
prepared giving effect (as if such events had occurred on such date) to (i) the consummation of the
Refinancing and (ii) the payment of fees and expenses in connection with the Refinancing. The Pro
Forma Balance Sheet has been prepared based on the best information available to the Borrower as of
the date of delivery thereof, and presents fairly on a pro forma basis the
estimated financial position of Borrower and its consolidated Subsidiaries as at September 30,
2006, assuming that the events specified in the preceding sentence had actually occurred at such
date.

          (b) The audited consolidated balance sheet of the Borrower and its consolidated Subsidiaries
as at September 30, 2006 and the related consolidated statements of income and of cash flows for
the fiscal year ended on such date, reported on by Deloitte & Touche LLP, copies of which have
heretofore been delivered to each of the Lenders, are complete and correct and present fairly in
all material respects the consolidated financial condition of the Borrower and its consolidated
Subsidiaries as at such respective dates, and the consolidated results of their operations and
their consolidated cash flows for the fiscal year or fiscal period then ended. Such financial
statements, including the related schedules and notes thereto, have been prepared in accordance
with GAAP applied consistently throughout the periods involved (except as approved by such
accountants and as disclosed therein). Neither the Borrower nor any of its consolidated
Subsidiaries had, at the date of the balance sheet referred to above, any material obligation,
contingent liability or liability for taxes, or any long-term lease or unusual forward or long-term
commitment, including without limitation, any interest rate or foreign currency swap or exchange
transaction, which is not reflected in the foregoing statements or in Schedule 4.1. Since
September 30, 2006 there has been no development or event which has had or could reasonably be
expected to have a Material Adverse Effect.

          4.2 Corporate Existence; Compliance with Law. Each of the Borrower and its Material
Subsidiaries (a) is duly organized, validly existing and in good standing under the laws of the
jurisdiction of its incorporation, (b) has the corporate or other power and authority and the legal
right to own and operate its property, to lease the property it leases and to conduct the business
in which it is currently engaged, (c) is duly qualified as a foreign corporation or other
applicable entity and in good standing under the laws of any jurisdiction where its ownership,
lease or operation of property or the conduct or

 

 

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proposed conduct of its business requires such
qualification, except where the failure to so qualify would not, in any instance or in the
aggregate, reasonably be expected to have a Material Adverse Effect and (d) is in compliance with
all material Requirements of Law applicable to it or its business, provided that the
provisions of this clause (d) do not restrict or limit the applicability of any knowledge or other
qualification which is given in this Agreement in any other matter which constitutes a “Requirement
of Law”.

     4.3 Corporate Power; Authorization; Enforceable Obligations. Each of the Borrower and its
Subsidiaries has the corporate or other power and authority and the legal right to make, deliver
and perform this Agreement and the other Loan Documents to which it is a party and to borrow
hereunder (in the case of the Borrower and any Subsidiary Borrower) and has taken all corporate or
other action necessary to be taken by it to authorize such actions. No consent, waiver or
authorization of, filing with, or other act by or in respect of, any Governmental Authority or any
other Person is required to be made or obtained by the Borrower or its Subsidiaries in connection
with the borrowings hereunder or the execution, delivery, performance, validity or
enforceability of this Agreement and the other Loan Documents to which it is a party. This
Agreement constitutes, and the other Loan Documents to which the Borrower or any Subsidiary is a
party when executed and delivered hereunder will constitute, a legal, valid and binding obligation
of the Borrower and such Subsidiary, enforceable against the Borrower and such Subsidiary in
accordance with their respective terms, except as enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium or similar laws affecting the enforcement of
creditors’ rights generally and by general equitable principles (whether enforcement is sought by
proceedings in equity or at law).

     4.4 No Legal Bar. The execution, delivery and performance of this Agreement and the other
Loan Documents, the borrowings hereunder and the use of the proceeds thereof or of any Subordinated
Debt do not violate any usury law applicable to the Borrower or any Subsidiary Borrower or any
other Requirement of Law or Contractual Obligation of the Borrower or any of its Material
Subsidiaries and do not result in, or require, the creation or imposition of any Lien on any of its
or their respective properties or revenues pursuant to any such Requirement of Law or Contractual
Obligation which could reasonably be expected to have a Material Adverse Effect except for Liens
which may be required by the Existing Senior Subordinated Note Indenture.

     4.5 No Material Litigation. Except as set forth on Schedule 4.5, no litigation,
investigation or proceeding of or before any arbitrator or Governmental Authority is pending or, to
the best knowledge of the Borrower, threatened by or against the Borrower or any of its
Subsidiaries or against any of its or their respective properties or revenues (a) with respect to
this Agreement, any of the other Loan Documents or any of the transactions contemplated hereby or
thereby or (b) which could reasonably be expected to have a Material Adverse Effect.

     4.6 No Burdensome Restrictions. No Requirement of Law or Contractual Obligation of the
Borrower or any of its Subsidiaries could reasonably be expected to have a Material Adverse Effect.

     4.7 No Default. Neither the Borrower nor any of its Subsidiaries is in default under or
with respect to any of its Contractual Obligations in any respect which would reasonably be
expected to have a Material Adverse Effect. No Default or Event of Default has occurred and is
continuing. Neither the Borrower nor any of its Subsidiaries is in default under any order, award
or decree of any arbitrator or Governmental Authority binding upon or affecting it or by which any
of its properties or assets may be bound or affected, where such default would reasonably be
expected to have a Material Adverse Effect.

     4.8 Subsidiaries. The Subsidiaries listed on Schedule 4.8 constitute all of the
Subsidiaries of the Borrower in existence on the date hereof.

 

 

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     4.9 Disclosure. No representations or warranties made by, or information supplied by, the
Borrower or any of its Subsidiaries in this Agreement, any other Loan Document or in any other
document, including
without limitation the Confidential Information Memorandum, furnished to the Lenders from time
to time in connection herewith or therewith (as such other documents may be supplemented from time
to time) contains or will contain any untrue statement of a material fact or omits or will omit to
state any material fact necessary to make the statements herein or therein, in light of the
circumstances under which they were made, not misleading. Except as disclosed in the Loan
Documents or as otherwise disclosed in writing to the Lenders, there is no fact known to the
Borrower or any of its Subsidiaries which has, or which would reasonably be expected to have, in
the Borrower’s or such Subsidiary’s reasonable judgment, a Material Adverse Effect.

     4.10 Schedules. Each of the Schedules to this Agreement contains true, complete and
correct information in all material respects.

     4.11 Federal Regulations. No part of the proceeds of any Loans will be used for (i) any
purpose which violates, or which would be inconsistent with, the provisions of the Regulations of
the Board of Governors of the Federal Reserve System as now and from time to time hereafter in
effect, and if deemed necessary in the reasonable judgment of the Administrative Agent or its
counsel, the Borrower will furnish to the Administrative Agent and each Lender a statement to the
foregoing effect in conformity with the requirements of FR Form G-3 or FR Form U-1, as applicable,
referred to in Regulation U of said Board or (ii) except as set forth on Schedule 4.11, purchasing
any security in any transaction which is subject to Sections 13 and 14 of the Securities Exchange
Act of 1934, as amended.

     4.12 Investment Company Act; Other Regulations. Neither the Borrower nor any of its
Subsidiaries is an “investment company”, or a company “controlled” by an “investment company”,
within the meaning of the Investment Company Act of 1940, as amended. Neither the Borrower nor any
of its Subsidiaries is subject to regulation under any U.S. federal or state statute or regulation
which limits its ability to incur indebtedness.

     4.13 Labor Matters. Except as, in the aggregate, could not reasonably be expected to have
a Material Adverse Effect: (a) there are no strikes or other labor disputes against the Borrower
or any of its Subsidiaries pending or, to the knowledge of the Borrower, threatened; (b) hours
worked by and payment made to employees of the Borrower and its Subsidiaries have not been in
violation of the Fair Labor Standards Act or any other applicable Requirement of Law dealing with
such matters; and (c) all payments due from the Borrower or any of its Subsidiaries on account of
employee health and welfare insurance have been paid or accrued as a liability on the books of the
Borrower or the relevant Subsidiary.

     4.14 ERISA. No “prohibited transaction” or “accumulated funding deficiency” (each as
defined in Section 8 hereof) or Reportable Event has occurred within the applicable statute of
limitations in effect as of the date hereof which has not been cured with respect to any Single
Employer Plan. The present value of all benefits vested under all Single Employer Plans maintained
by the Borrower or a Commonly Controlled Entity (based on those assumptions used to fund such Plans
in accordance with Section 412 of the Code) did not, as of the last annual valuation date, exceed
the value of the assets of such Plan determined in accordance with Section 412 of the Code
allocable to such vested benefits. The liability to
which the Borrower or any Commonly Controlled Entity would become subject under ERISA if the
Borrower or any such Commonly Controlled Entity were to withdraw completely (as defined in Section
4203 of ERISA) from all Multi-employer Plans as of the valuation date most closely preceding the
date hereof is not in excess of $3,000,000. The Borrower does not currently participate in any
Multi-employer Plans.

 

 

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          4.15 Title to Real Property, Etc. Each of the Borrower and its Subsidiaries has good and
marketable title in fee simple to, or a valid and subsisting leasehold interest in, all its real
property and good title to all its other property, except where the failure to have such good and
marketable title would not reasonably be expected to have a Material Adverse Effect, and none of
such property is subject to any Lien, except as permitted by subsection 7.1 of this Agreement.

          4.16 Taxes. Each of the Borrower and its Subsidiaries has filed or caused to be filed all
tax returns which are required to be filed and has paid all taxes shown to be due and payable on
said returns or on any assessments made against it or any of its property and all other taxes, fees
or other charges imposed on it or any of its property by any Governmental Authority (other than any
the amount or validity of which are currently being contested in good faith by appropriate
proceedings and with respect to which reserves in conformity with GAAP have been provided on the
books of the Borrower or its Subsidiaries, as the case may be) except where the failure to file
such returns or pay such taxes and/or assessments would not reasonably be expected to have a
Material Adverse Effect; no tax Lien has been filed, and, to the knowledge of the Borrower, no
claim is being asserted, with respect to any such tax, fee or other charge.

          4.17 Environmental Matters. Except as set forth on Schedule 4.17, each of the following is
true and correct as of the date hereof, other than exceptions to any of the following that, in the
aggregate, would not reasonably be expected by the Borrower to have a Material Adverse Effect:

     (a) Each of the properties owned or operated by the Borrower or any of its
Subsidiaries does not contain, and has not previously contained, any Materials of
Environmental Concern in amounts or concentrations which (i) constitute or constituted a
violation of, or (ii) could reasonably give rise to liability in a Material Environmental
Amount under, any Environmental Laws.

     (b) The Borrower and its Subsidiaries are and have been in compliance with all
applicable Environmental Laws, and there is no contamination or violation of any
Environmental Law which, in the aggregate with all other contaminations and violations,
would interfere with the continued operations or the business of the Borrower and its
Subsidiaries, in each case taken as a whole or impair the fair saleable value thereof.

     (c) Neither the Borrower nor any of its Subsidiaries has received any notice of
violation, alleged violation, non-compliance, liability or potential liability regarding
environmental matters or compliance with Environmental Laws nor does the Borrower have
knowledge or reason to believe that any such notice will be received or is being threatened.

     (d) With respect to the Borrower and its Subsidiaries, Materials of Environmental
Concern have not been transported or disposed of in violation of, or in a manner or to a
location which would reasonably give rise to liability under, Environmental Laws, nor have
any Materials of Environmental Concern been generated, treated, stored or disposed of at, on
or under any of its properties in violation of, or in a manner that would reasonably give
rise to liability in a Material Environmental Amount under, any applicable Environmental
Laws.

     (e) No judicial proceedings or governmental or administrative action is pending, or,
to the knowledge of the Borrower, threatened, under any Environmental Law to which the
Borrower or any of its Subsidiaries is or will be named as a party or which will adversely
affect the ability of the Borrower or any of its Subsidiaries to conduct any part of their
business nor are there any consent decrees or other decrees, consent orders, administrative
orders or other orders, or other

 

 

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administrative or judicial requirements outstanding under
any Environmental Law with respect to the Borrower or any of its Subsidiaries.

     (f) There has been no release or threat of release of Materials of Environmental
Concern at any location for which the Borrower or any of its Subsidiaries is liable by
contract or operation of law, in violation of or in amounts or in a manner that would
reasonably give rise to liability in a Material Environmental Amount under Environmental
Laws.

          4.18 Intellectual Property. The Borrower and each of its Subsidiaries owns, or is licensed
to use, all trademarks, tradenames, copyrights, technology, know-how and processes necessary for
the conduct of its business as currently conducted except for those the failure of which to own or
license would not reasonably be expected to have a Material Adverse Effect (the “Intellectual
Property”). No claim has been asserted and is pending by any Person challenging or questioning
the use of any such Intellectual Property or the validity or effectiveness of any such Intellectual
Property, and the Borrower does not know of any valid basis for any such claim, except for such
claims which have previously been disclosed to the Lenders and would not reasonably be expected to
have a Material Adverse Effect. The use of such Intellectual Property by the Borrower and its
Subsidiaries does not infringe on the rights of any Person, except for such claims and
infringements that, in the aggregate, would not reasonably be expected to have a Material Adverse
Effect.

          4.19 Security Documents. Except to the extent otherwise noted therein, the Guarantee and
Collateral Agreement and each Foreign Pledge Agreement are effective to create in favor of the
Administrative Agent, for the benefit of the Lenders (or, where required by law, in favor of each
Lender), a legal, valid and enforceable security interest in the Collateral described therein and
the proceeds thereof. In the case of (i) the Pledged Stock described and defined in the Guarantee
and Collateral Agreement, except to the extent otherwise noted therein, when stock certificates
representing such Pledged Stock are delivered to the Administrative Agent, (ii) the other
Collateral described and defined in the Guarantee and Collateral Agreement, except to the extent
otherwise noted therein, when the financing statements specified on Schedule 4.19(ii) in
appropriate form are filed in the offices specified on Schedule 4.19(ii) and (iii) the filings and
other actions are made in respect of the Foreign Pledge Agreements specified on Schedule 4.19(iii),
each Security Document shall constitute a fully perfected Lien on, and security interest in, all
right, title and interest of the Loan Parties in such Collateral and the proceeds thereof, as
security for the Obligations (as defined in the Security Documents), in each case prior and
superior in right to any other Person. The pledge of the Capital Stock of any Excluded Foreign
Subsidiary will be limited to 65% of the Capital Stock of such Excluded Foreign Subsidiary. The
obligations of a Foreign Subsidiary Borrower (other
than Scotts Treasury EEIG) shall be secured by 100% of the Capital Stock of such Foreign
Subsidiary Borrower (except with respect to Scotts Australia Pty Ltd., which shall be secured by
65% of the Capital Stock of such Subsidiary), 100% of the Capital Stock of each first-tier
Subsidiary of such Foreign Subsidiary Borrower that is not an Excluded Foreign Subsidiary and 65%
of the Capital Stock of the each first-tier Subsidiary of such Foreign Subsidiary Borrower that is
an Excluded Foreign Subsidiary, but no other assets of Foreign Subsidiaries of the Borrower shall
be pledged as collateral security.

          4.20 Solvency.

          (a) The Borrower and each of its Subsidiaries is, and after giving effect to the Transactions
and the incurrence of all Indebtedness and obligations being incurred in connection herewith and
therewith will be and will continue to be, Solvent.

          (b) Each Subsidiary Borrower is in compliance with all material Requirements of Law
applicable to it with respect to capitalization and, to the knowledge of the Borrower or such
Subsidiary

 

 

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Borrower, has sufficient capital with which to conduct its business in accordance with past
practice. No Subsidiary Borrower is undercapitalized to such an extent that, solely as a result of
such undercapitalization, any Lender would be deemed under the laws of the relevant jurisdiction to
owe a fiduciary duty to any other creditor of such Subsidiary Borrower or the Loans made by
relevant Lenders to such Subsidiary Borrower would be subordinated to any obligations of such
Subsidiary Borrower owing to any other Person.

          SECTION 5.CONDITIONS PRECEDENT

          5.1 Conditions to Initial Extensions of Credit. The agreement of
each Lender to make the initial Extension of Credit requested to be made by it is subject to the
satisfaction, prior to or concurrently with the making of such Extension of Credit, of the
following conditions precedent:

     (a)   Execution of Credit Agreement. The Administrative Agent shall have
received this Agreement, duly executed and delivered by the Borrower and each of the
Subsidiary Borrowers party to this Agreement as of the Closing Date and by each of the
Lenders listed on Schedule 1.

     (b)   Execution of Security Documents. The Administrative Agent shall have
received the Guarantee and Collateral Agreement, duly executed and delivered by the Borrower
and each of the Subsidiary Guarantors party thereto as of the Closing Date.

     (c)   Pro Forma Balance Sheet; Financial Statements. The Lenders shall have
received the financial statements described in subsections 4.1(a) and (b) and such financial
statements shall not, in the reasonable judgment of the Lenders, reflect any material
adverse change in the consolidated financial condition of the Borrower or its Subsidiaries,
as reflected in the financial statements or projections contained in the Confidential
Information Memorandum.

     (d)   Fees. The Lenders, the Administrative Agent and the Arrangers shall have
received all fees required to be paid, and all expenses for which invoices have been
presented by the Administrative Agent (including the reasonable fees and expenses of legal
counsel), on or before the Closing Date. All such amounts will be paid with proceeds of
Loans made on the Closing Date and will be reflected in the funding instructions given by
the Borrower to the Administrative Agent on or before the Closing Date.

     (e)   Legal Opinion of Counsel to the Borrower and the Subsidiary Borrowers.
The Administrative Agent and each Lender shall have received:

     (i) an executed legal opinion of Vorys, Sater, Seymour and Pease LLP, special
counsel to the Borrower, dated the Closing Date and addressed to the Administrative
Agent and the Lenders substantially in the form of Exhibit G. The Administrative
Agent and each Lender shall have received an executed legal opinion of Vorys, Sater,
Seymour and Pease LLP, or such other counsel reasonably satisfactory to the
Administrative Agent, as counsel to each Domestic Subsidiary Borrower, dated the
Closing Date and addressed to the Administrative Agent and the Lenders;

     (ii) an executed legal opinion of Clifford Chance, as counsel to each Foreign
Subsidiary Borrower (or such other counsel to any Foreign Subsidiary Borrower as may
be selected by the Borrower and reasonably satisfactory to the Administrative
Agent), dated the Closing Date and addressed to the Administrative Agent and the
Lenders substantially in the form required by subsection 5.3; and

 

57

     (iii) an executed legal opinion from such special or local counsel as the
Administrative Agent shall reasonably request, in each case, in form and substance
reasonably satisfactory to the Administrative Agent.

     (f) Corporate Proceedings of the Borrower and its Subsidiaries. The
Administrative Agent shall have received a copy of the resolutions (in form and substance
reasonably satisfactory to the Administrative Agent and its counsel) of the Board of
Directors of each of the Borrower and each of its Subsidiaries executing any Loan Document
authorizing on or within 30 days prior to the Closing Date (i) the execution, delivery and
performance of each of the Loan Documents to which it is a party, (ii) the consummation of
the transactions contemplated hereby and thereby and (iii) the borrowings herein provided
for, all certified by the Secretary or the Assistant Secretary (or equivalent Person for
Subsidiaries which are not corporations) of the Borrower or such Subsidiary, as the case may
be. Each such certificate shall (A) state that the resolutions set forth therein have not
been amended, modified, revoked or rescinded as of the date of such certificate, (B) specify
the names and titles of the officers of the Borrower or such Subsidiary, as the case may be,
authorized to sign the Loan Documents to which it is a party and (C) contain specimens of
the signatures of such officers. 

     (g) Consents, Licenses, Approvals, etc. The Administrative Agent shall have
received true copies (certified to be such by the Borrower or other appropriate party) of
all material consents, licenses and approvals required in accordance with applicable law in
connection with the execution, delivery, performance, validity and enforceability of this
Agreement and the other Loan Documents to be delivered on or before the Closing Date, and
the Borrower and its Material Subsidiaries shall have all such material consents, licenses
and approvals required in connection with the continued operation of the Borrower and its
Material Subsidiaries, and such approvals shall be in full force and effect, and all
applicable waiting periods shall have expired without any action being taken or threatened
in writing by any competent authority which would restrain, prevent or otherwise impose
material, adverse conditions on this Agreement and the actions contemplated hereby.

     (h) Pledged Stock; Stock Powers. Except as set forth on Schedule 5.1(b) or
contemplated in subsection 6.11(a), the Administrative Agent shall have received (i) the
certificates representing the shares of Capital Stock pledged pursuant to the Guarantee and
Collateral Agreement, together with an undated stock power for each such certificate
executed in blank by a duly authorized officer of the pledgor thereof.

     (i) Filings, Registrations and Recordings. Each document (including any
Uniform Commercial Code financing statement or foreign equivalent) required by the Loan
Documents, under applicable law or as otherwise reasonably requested by the Administrative
Agent to be filed, registered or recorded in order to create in favor of the Administrative
Agent, for the benefit of the Lenders, a perfected Lien on the Collateral described therein,
prior and superior in right to any other Person (other than with respect to Liens expressly
permitted by subsection 7.1), shall be in proper form for filing, registration or
recordation in the applicable jurisdiction.

     (j) Repayment and Termination of Existing Credit Agreement. The loans under
the Existing Credit Agreement shall have been repaid, the letters of credit outstanding
thereunder shall have been returned or shall be deemed to be outstanding hereunder pursuant
to subsection 3.1(d), the commitments under the Existing Credit Agreement shall have been
terminated and all accrued interest and fees thereunder shall have been paid, or
arrangements satisfactory to the Administrative Agent in respect thereof shall have been
made.

 

58

     (k) Additional Information. The Administrative Agent shall have received such
additional information which the Administrative Agent shall have reasonably requested,
including, without limitation, information to satisfy Lenders’ “Know Your Customer”
requirements under Federal law, copies of any debt agreements, security agreements, tax
sharing agreements, employment agreements, management compensation arrangements, financing
arrangements and other material contracts, and such agreements or arrangements shall be
reasonably satisfactory in form and substance to the Administrative Agent and its counsel.

          5.2 Conditions to All Extensions of Credit. The obligation of
each Lender to make any Loan (other than any Loan the proceeds of which are to be used exclusively
to repay Refunded Swing Line Loans) or of the Issuing Lender to issue, increase or extend any
Letter of Credit requested to be issued, increased or extended by it hereunder on any date
(including, without limitation, the date of the initial Extensions of Credit made hereunder) is
subject to the satisfaction of the following conditions precedent as of such date:

     (a)   Representations and Warranties. The representations and warranties made
by the Borrower or any of its Subsidiaries in the Loan Documents to which it is a party and
any representations and warranties made by the Borrower or any of its Subsidiaries which are
contained in any certificate, document or financial or other statement furnished at any time
pursuant hereto or thereto shall be true and correct in all material respects on and as of
the date thereof as if made on and as of such date unless stated to relate to a specific
earlier date (in which case the same shall be true and correct in all material respects on
and as of such specific earlier date).

     (b)   No Default or Event of Default. No Default or Event of Default shall
have occurred and be continuing on such date or after giving effect to the Extension of
Credit to be made on such date.

     (c)   Subsidiary Borrower Borrowing. With respect to any borrowing made by any
Subsidiary Borrower, a certificate of the Borrower to the effect that such borrowing will
not give rise to an Event of Default under the Existing Senior Subordinated Note Indenture
or under any other Subordinated Debt permitted hereunder and dated as of the date of such
borrowing shall have been delivered to the Administrative Agent.

          Each borrowing by the Borrower under this Agreement, each conversion of any Loan pursuant to
subsection 2.14 of this Agreement and each issuance, increase or extension of any Letter of Credit
hereunder shall constitute a representation and warranty by the Borrower as of the date of such
borrowing, conversion or issuance, increase or extension that the conditions contained in the
foregoing paragraphs (a) and (b) of this subsection 5.2 have been satisfied.

          5.3 Additional Conditions Applicable to Foreign Subsidiary
Borrowers. The agreement of each Lender to make any Extension of Credit requested to be made
by it to any Foreign Subsidiary Borrower on any date (including, without limitation, the initial
Extension of Credit and each Swing Line Loan, if requested to be made to any Foreign Subsidiary
Borrower) is subject to satisfaction or waiver of, in addition to the conditions precedent set
forth in subsections 5.1 (in the case of the initial Extension of Credit) and 5.2, the following
conditions precedent: (a) in the case of the making of any Extension of Credit to any Foreign
Subsidiary Borrower for the first time, the delivery to the Administrative Agent, with a copy for
each Lender, of the executed legal opinion of counsel to such Foreign Subsidiary Borrower addressed
to the Administrative Agent and the Lenders, as to the matters set forth in Exhibit H and otherwise
in form and substance reasonably satisfactory to the Administrative Agent and (b) the

 

59

truthfulness and correctness in all material respects on and as of such date of the following
additional representations and warranties:

          (i)   Pari Passu. The obligations of such Foreign Subsidiary Borrower under
this Agreement, when executed and delivered by such Foreign Subsidiary Borrower, will rank
at least pari passu with all unsecured Indebtedness of such Foreign
Subsidiary Borrower.

          (ii)   No Immunities, etc. Such Foreign Subsidiary Borrower is subject to
civil and commercial law with respect to its obligations under this Agreement and any Note,
and the execution, delivery and performance by such Foreign Subsidiary Borrower of this
Agreement constitute and will constitute private and commercial acts and not public or
governmental acts. Neither such Foreign Subsidiary Borrower nor any of its property,
whether or not held for its own account, has any immunity (sovereign or other similar
immunity) from any suit or proceeding, from jurisdiction of any court or from set-off or any
legal process (whether service or notice, attachment prior to judgment, attachment in aid of
execution of judgment, execution of judgment or other similar immunity) under laws of the
jurisdiction in which such Foreign Subsidiary Borrower is organized and existing in respect
of its obligations under this Agreement or any Note. Such Foreign Subsidiary Borrower has
waived every immunity (sovereign or otherwise) to which it or any of its properties would
otherwise be entitled from any legal action, suit or proceeding, from jurisdiction of any
court and from set-off or any legal process (whether service or notice, attachment prior to
judgment, attachment in aid of execution of judgment, execution of judgment or otherwise)
under the laws of the jurisdiction in which such Foreign Subsidiary Borrower is organized
and existing in respect of its obligations under this Agreement and any Note. The waiver by
such Foreign Subsidiary Borrower described in the immediately preceding sentence is the
legal, valid and binding obligation of such Foreign Subsidiary Borrower.

          (iii)   No Recordation Necessary. Except as otherwise noted on Schedule
5.3(iii), this Agreement and each Note, if any, is in proper legal form under the law of the
jurisdiction in which such Foreign Subsidiary Borrower is organized and existing for the
enforcement hereof or thereof against such Foreign Subsidiary Borrower under the law of such
jurisdiction, and to ensure the legality, validity, enforceability, priority or
admissibility in evidence of this Agreement and any such Note. It is not necessary to
ensure the legality, validity, enforceability, priority or admissibility in evidence of this
Agreement and any such Note that this Agreement, any Note or any other document be filed,
registered or recorded with, or executed or notarized before, any court or other authority
in the jurisdiction in which such Foreign Subsidiary Borrower is organized and existing or
that any registration charge or stamp or similar tax be paid on or in respect of this
Agreement, any Note or any other document, except for any such filing, registration or
recording, or execution or notarization, as has been made or is not required to be made
until this Agreement, any Note or any other document is sought to be enforced and for any
charge or tax as has been timely paid.

          (iv)   Exchange Controls. The execution, delivery and performance by such
Foreign Subsidiary Borrower of this Agreement, any Note or the other Loan Documents is,
under applicable foreign exchange control regulations of the jurisdiction in which such
Foreign Subsidiary Borrower is organized and existing, not subject to any notification or
authorization except (i) such as have been made or obtained or (ii) such as cannot be made
or obtained until a later date (provided any notification or authorization described in
immediately preceding clause (ii) shall be made or obtained as soon as is reasonably
practicable).

          Each borrowing by, and Letter of Credit issued for the account of, any Foreign Subsidiary
Borrower hereunder shall constitute a representation and warranty by each of the Borrower and such

 

60

Foreign Subsidiary Borrower as of the date of such borrowing or such issuance that the
conditions contained in this subsection 5.3 have been satisfied.

          SECTION 6. AFFIRMATIVE COVENANTS

          The Borrower hereby agrees that, so long as the Revolving Credit Commitments remain in effect,
any Letter of Credit is outstanding or any amount is owing to any Lender or the Administrative
Agent hereunder or under any other Loan Document, the Borrower shall, and in the case of the
agreements set forth in subsections 6.3, 6.4, 6.5, 6.6, 6.7, 6.11 and 6.12, shall cause each of its
Material Subsidiaries to:

          6.1 Financial Statements. Furnish to the Administrative Agent and
each Lender:

     (a)   as soon as available, but in any event within 90 days after the end of each
fiscal year of the Borrower, a copy of the consolidated balance sheet of the Borrower and
its Subsidiaries as at the end of such year and the related statements of consolidated
income and retained earnings and of cash flows for such year, setting forth in each case in
comparative form the figures for the previous year; provided that the consolidated
statements shall be certified without a “going concern” or like qualification or exception
or qualification arising out of the scope of the audit by independent certified public
accountants of nationally recognized standing; and

     (b)   as soon as available, but in any event not later than 45 days after the end of
each of the first three quarterly periods of each fiscal year of the Borrower, a copy of the
unaudited consolidated balance sheet of the Borrower and its Subsidiaries as at the end of
each such quarter and the related unaudited statements of consolidated income and retained
earnings and of cash flows for such quarter and the portion of the fiscal year through such
date setting forth in each case in comparative form the figures for the previous year,
certified by a Responsible Officer as being fairly stated in all material respects;

all such financial statements to be complete and correct in all material respects and prepared in
reasonable detail and in accordance with GAAP (except, in the case of the financial statements
referred to in subparagraph (b), such financial statements need not contain notes and shall be
prepared substantially in accordance with GAAP) applied consistently throughout the periods
reflected therein, except as otherwise disclosed in the notes thereto.

          Any financial statement required to be delivered pursuant to this subsection 6.1 shall be
deemed to have been delivered on the date on which the Borrower posts such financial statement on
its website on the Internet at www.scotts.com or when such financial statement is posted on the
SEC’s website on the Internet at www.sec.gov; provided that the Borrower shall give notice
of any such posting to the Administrative Agent (who shall then give notice of any such posting to
the Lenders); provided, further, that the Borrower shall deliver paper copies of
any financial statement referred to in this subsection 6.1 to the Administrative Agent if the
Administrative Agent or any Lender requests the Borrower to deliver such paper copies until written
notice to cease delivering such paper copies is given by the Administrative Agent.

          6.2 Certificates; Other Information. Furnish to the
Administrative Agent and each Lender:

     (a)   concurrently with the delivery of the financial statements referred to in
subsection 6.1(a) above, a certificate of the independent certified public accountants
certifying such financial

 

61

statements (i) stating that in making the examination necessary therefor no knowledge
was obtained of any Default or Event of Default, except as specified in such certificate and
(ii) showing in detail the calculations supporting such statement in respect of subsections
6.9, 6.10, 7.4 and 7.5;

     (b)   concurrently with the delivery of the financial statements referred to above, a
certificate from the auditing accountants (for the year-end statements) or a Responsible
Officer of the Borrower (for all statements) stating that, to the best of such Responsible
Officer’s knowledge, the Borrower and each of its Material Subsidiaries during such period
has observed or performed in all material respects all of its material covenants and other
agreements, and satisfied every condition contained in this Agreement and the Security
Documents to be observed, performed or satisfied by it, and that such Officer has obtained
no knowledge of any Default or Event of Default except as specified in such certificate, and
showing in detail the calculations supporting such statement in respect of subsections 6.9,
6.10, 7.4 and 7.5;

     (c)   as soon as available, and in any event no later than 90 days after the end of
each fiscal year of the Borrower, a detailed consolidated budget for the following fiscal
year (including a projected consolidated balance sheet of the Borrower and its Subsidiaries
as of the end of the following fiscal year, the related consolidated statements of projected
cash flow, projected changes in financial position and projected income and a description of
the underlying assumptions applicable thereto), and, as soon as available, significant
revisions, if any, of such budget and projections with respect to such fiscal year
(collectively, the “Projections”), which Projections shall in each case be
accompanied by a certificate of a Responsible Officer stating that such Projections are
based on reasonable estimates, information and assumptions and that such Responsible Officer
has no reason to believe that such Projections are incorrect or misleading in any material
respect;

     (d)   concurrently with the delivery of the financial statements referred to in
subsection 6.1(a) and (b) above, a written discussion and analysis (in a form and detail
substantially similar to that contained in the Form 10-K or Form 10-Q filed by the Borrower
with the Securities and Exchange Commission for the period covered by such financial
statements) by the Borrower with respect to the period covered by such financial statements;

     (e)   promptly after the same are sent and received, copies of all financial
statements, reports and notices which the Borrower or any of its Subsidiaries sends to its
shareholders and promptly after the same are filed and received, copies of all financial
statements and reports which the Borrower or any of its Subsidiaries may make to, or file
with, and copies of all material notices the Borrower or any such Subsidiary receives from,
the Securities and Exchange Commission or any public body succeeding to any or all of the
functions of the Securities and Exchange Commission;

     (f)   promptly upon receipt thereof, copies of all final reports submitted to the
Borrower by independent certified public accountants in connection with each annual, interim
or special audit of the books of the Borrower or any of its Subsidiaries made by such
accountants, including, without limitation, any final comment letter submitted by such
accountants to management in connection with their annual audit; and

     (g)   promptly, on reasonable notice to the Borrower, such additional financial and
other information as the Administrative Agent or any Lender may from time to time reasonably
request.

 

62

          6.3  Payment of Obligations. Pay, discharge or otherwise satisfy
at or before maturity or before they become delinquent, as the case may be, all its Indebtedness
and other material obligations of whatever nature, except, without prejudice to the effectiveness
of paragraph (e) of Section 8 hereof for any Indebtedness or other obligations (including any
obligations for taxes), when the amount or validity thereof is currently being contested in good
faith by appropriate proceedings and reserves in conformity with GAAP with respect thereto have
been provided on the books of the Borrower or its Subsidiaries, as the case may be, and except for
trade accounts payable incurred in the ordinary course of business which are paid in accordance
with normal industry practice.

          6.4   Compliance with Laws. Comply with all laws, rules,
regulations and orders of any Governmental Authority and any Contractual Obligations 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.

          6.5   Conduct of Business and Maintenance of Existence. Continue to
engage in business of the same general type as now conducted by it and, except as may be permitted
under subsection 7.3, preserve, renew and keep in full force and effect its corporate existence and
take all reasonable action to maintain all material rights, privileges, contracts, copyrights,
patents, trademarks, tradenames and franchises necessary or desirable in the normal conduct of its
business; and comply with all of its Contractual Obligations and Requirements of Law except to the
extent that the failure to comply therewith could not, in the aggregate, reasonably be expected to
have a Material Adverse Effect.

          6.6   Maintenance of Property, Insurance. Keep all property useful
and necessary in its business in good working order and condition; maintain with financially sound
and reputable insurance companies insurance on all its property in at least such amounts and
against at least such risks (but including in any event public liability, product liability and
business interruption insurance) as are usually insured against in the same general area by
companies engaged in the same or a similar business; and furnish to each Lender, upon written
request, reasonable information as to the insurance carried.

          6.7   Inspection of Property; Books and Records; Discussions. Keep
proper books of record and account in which full, true and correct entries in conformity with GAAP
and all Requirements of Law shall be made of all dealings and transactions in relation to its
business and activities; and permit representatives of the Administrative Agent or upon the
occurrence and during the continuance of an Event of Default, the Lenders to visit and inspect any
of its properties, and examine and make abstracts from any of its books and records at the
Borrower’s expense, at any reasonable time and as often as may reasonably be requested, and to
discuss the business, operations, properties and financial and other condition of the Borrower and
its Subsidiaries with officers and employees of the Borrower and its Subsidiaries and with its
independent certified public accountants.

          6.8   Notices. Promptly give notice to the Administrative Agent and
each Lender (and, in the case of clauses (a), (b) and (c), in any event within five Business Days
after learning thereof):

     (a)   of the occurrence of any Default or Event of Default;

     (b)   of any (i) default or event of default under any material Contractual Obligation
of the Borrower or any of its Material Subsidiaries or (ii) litigation, investigation or
proceeding which may exist at any time between the Borrower or any of its Subsidiaries and
any Governmental Authority, which, if adversely determined, would reasonably be expected to
have a Material Adverse Effect;

 

63

     (c)   of any litigation or proceeding affecting the Borrower or any of its Subsidiaries
(i) (A) in which the amount of liability asserted against the Borrower and its Subsidiaries
is $5,000,000 or more and not covered by insurance and (B) which, in the reasonable opinion
of a Responsible Officer of the Borrower, if adversely determined, would reasonably be
expected to have a Material Adverse Effect or (ii) in which injunctive or similar relief is
sought and which, in the reasonable opinion of a Responsible Officer of the Borrower, if
adversely determined, would reasonably be expected to have a Material Adverse Effect;

     (d)   of the following events, as soon as possible and in any event within 30 days
after the Borrower knows or has reason to know thereof: (i) the occurrence of any Reportable
Event with respect to any Plan, or (ii) the institution of proceedings or the taking or
expected taking of any other action by PBGC or the Borrower or any Commonly Controlled
Entity to terminate or withdraw or partially withdraw from any Plan under circumstances
which could lead to material liability to the PBGC or, with respect to a Multi-employer
Plan, the Reorganization or Insolvency (as each such term is defined in ERISA) of the Plan
and in addition to such notice, deliver to the Administrative Agent and each Lender
whichever of the following may be applicable: (A) a certificate of a Responsible Officer of
the Borrower setting forth details as to such Reportable Event and the action that the
Borrower or a Commonly Controlled Entity proposes to take with respect thereto, together
with a copy of any notice of such Reportable Event that may be required to be filed with
PBGC, or (B) any notice delivered by PBGC evidencing its intent to institute such
proceedings or any notice to PBGC that such Plan is to be terminated, as the case may be;
and

     (e)   any decision or other action of any Governmental Authority which cancels, limits,
or otherwise restricts the use or sale of any of the products (including any of the material
active ingredients in any of the products) of the Borrower or any of its Subsidiaries; and

     (f)   of any event, act or omission which would reasonably be expected to have a
Material Adverse Effect.

Each notice pursuant to subsections (a) through (e) of this subsection 6.8 shall be accompanied by
a statement of the Chief Executive Officer or Chief Financial Officer or other Responsible Officer
of the Borrower setting forth details of the occurrence referred to therein and stating what action
the Borrower proposes to take with respect thereto. For all purposes of clause (d) of this
subsection 6.8, the Borrower shall be deemed to have knowledge of all facts attributable to the
administrator of such Plan.

          6.9   Maintenance of Interest Coverage Ratio. At each quarterly
date set forth below with respect to the fiscal quarter of the Borrower then ending maintain the
Interest Coverage Ratio of the Borrower at not less than the applicable ratio set forth opposite
each such date:

	 	 	 	 	 
	Fiscal Quarter	 	Ratio
	March 31, 2007
	 	 	2.75 to 1.00	 
	June 30, 2007
	 	 	2.75 to 1.00	 
	September 30, 2007
	 	 	2.75 to 1.00	 
	December 31, 2007
	 	 	2.75 to 1.00	 
	March 31, 2008
	 	 	2.75 to 1.00	 
	June 30, 2008
	 	 	2.75 to 1.00	 
	September 30, 2008
	 	 	3.25 to 1.00	 
	December 31, 2008
	 	 	3.25 to 1.00	 
	March 31, 2009
	 	 	3.25 to 1.00	 
	June 30, 2009
	 	 	3.25 to 1.00	 

 

64

	 	 	 	 	 
	Fiscal Quarter	 	Ratio
	September 30, 2009
	 	 	3.50 to 1.00	 
	December 31, 2009
	 	 	3.50 to 1.00	 
	March 31, 2010
	 	 	3.50 to 1.00	 
	June 30, 2010
	 	 	3.50 to 1.00	 
	September 30, 2010
	 	 	3.50 to 1.00	 
	December 31, 2010
	 	 	3.50 to 1.00	 
	March 31, 2011
	 	 	3.50 to 1.00	 
	June 30, 2011
	 	 	3.50 to 1.00	 
	September 30, 2011 and thereafter
	 	 	3.50 to 1.00	 

Covenant calculations shall be made on the date that is the nearest to each quarterly date listed
above, to the extent the last day for the relevant fiscal quarter of the Borrower falls on a day
other than on the corresponding covenant test date.

          6.10   Maintenance of Leverage Ratio. At each quarterly date set
forth below with respect to the fiscal quarter of the Borrower then ending maintain the Leverage
Ratio of the Borrower at not greater than the applicable ratio set forth opposite each such date:

	 	 	 	 	 
	Fiscal Quarter	 	Ratio
	March 31, 2007
	 	 	4.75 to 1.00	 
	June 30, 2007
	 	 	4.75 to 1.00	 
	September 30, 2007
	 	 	4.75 to 1.00	 
	December 31, 2007
	 	 	4.75 to 1.00	 
	March 31, 2008
	 	 	4.75 to 1.00	 
	June 30, 2008
	 	 	4.75 to 1.00	 
	September 30, 2008
	 	 	4.25 to 1.00	 
	December 31, 2008
	 	 	4.25 to 1.00	 
	March 31, 2009
	 	 	4.25 to 1.00	 
	June 30, 2009
	 	 	4.25 to 1.00	 
	September 30, 2009
	 	 	3.75 to 1.00	 
	December 31, 2009
	 	 	3.75 to 1.00	 
	March 31, 2010
	 	 	3.75 to 1.00	 
	June 30, 2010
	 	 	3.75 to 1.00	 
	September 30, 2010
	 	 	3.50 to 1.00	 
	December 31, 2010
	 	 	3.50 to 1.00	 
	March 31, 2011
	 	 	3.50 to 1.00	 
	June 30, 2011
	 	 	3.50 to 1.00	 
	September 30, 2011 and thereafter
	 	 	3.25 to 1.00	 

Covenant calculations shall be made on the date that is the nearest to each quarterly date listed
above, to the extent the last day for the relevant fiscal quarter of the Borrower falls on a day
other than on the corresponding covenant test date.

          6.11   Additional Collateral, etc..

          (a)   During any Full Security Period, with respect to any Specified Property acquired after
the Closing Date by the Borrower or any of its Subsidiaries (other than (x) any Specified Property
described in paragraph (b), (c) or (d) below, (y) any Specified Property subject to a Lien
expressly

 

65

permitted by subsection 7.1(a) or 7.1(l) and (z) Specified Property acquired by any Excluded
Foreign Subsidiary or by any other Foreign Subsidiary other than Capital Stock of, or acquired by,
any Foreign Subsidiary Borrower) as to which the Administrative Agent, for the benefit of the
Lenders, does not have a perfected Lien, promptly (i) execute and deliver to the Administrative
Agent such amendments to the Guarantee and Collateral Agreement or such other documents as the
Administrative Agent deems necessary or advisable to grant to the Administrative Agent, for the
benefit of the Lenders, a security interest in such Specified Property and (ii) take all actions
necessary or advisable to grant to the Administrative Agent, for the benefit of the Lenders, a
perfected first priority security interest in such Specified Property, including the filing of
Uniform Commercial Code financing statements in such jurisdictions as may be required by the
applicable Guarantee and Collateral Agreement or by law or as may be requested by the
Administrative Agent.

          (b)   During any Capital Stock Security Period, with respect to any new Domestic Subsidiary
(other than a Domestic Subsidiary that is a Receivables Subsidiary) created or acquired after the
Closing Date by the Borrower or any of its Subsidiaries, promptly (i) execute and deliver to the
Administrative Agent such amendments to the Guarantee and Collateral Agreement as the
Administrative Agent deems necessary or advisable to grant to the Administrative Agent, for the
benefit of the Lenders, a perfected first priority security interest in the Capital Stock of such
new Domestic Subsidiary that is owned by the Borrower or any of its Subsidiaries, (ii) deliver to
the Administrative Agent the certificates representing such Capital Stock, together with undated
stock powers, in blank, executed and delivered by a duly authorized officer of the Borrower or such
Subsidiary, as the case may be, (iii) cause such new Domestic Subsidiary (A) to become a party to
the Guarantee and Collateral Agreement and such other Security Documents, as applicable, (B) to
take such actions necessary or advisable to grant to the Administrative Agent for the benefit of
the Lenders a perfected first priority security interest in the Collateral described in the
Guarantee and Collateral Agreement or such other Security Document, as applicable, with respect to
such new Domestic Subsidiary (however, in the case of a pledge by the new Domestic Subsidiary of
Capital Stock of an Excluded Foreign Subsidiary, such pledge shall be limited to 65% of voting
Capital Stock of such Excluded Foreign Subsidiary), including the filing of Uniform Commercial Code
financing statements in such jurisdictions as may be required by applicable Guarantee and
Collateral Agreement or by law or as may be requested by the Administrative Agent and (C) to
deliver to the Administrative Agent a certificate of such new Domestic Subsidiary, substantially in
the form of Exhibit J, with appropriate insertions and attachments, and (iv) if requested by the
Administrative Agent, deliver to the Administrative Agent legal opinions relating to the matters
described above, which opinions shall be in form and substance, and from counsel, reasonably
satisfactory to the Administrative Agent, provided that, if the initial investment in or
purchase price of such new Domestic Subsidiary is less than $10,000,000, the obligations of the
Borrower discussed in clauses (i) through (iv) of this subsection 6.11(a) shall not take effect
unless and until the financial statements delivered to the Administrative Agent following each
fiscal year of the Borrower pursuant to subsection 6.1(a) show the tangible net worth of such new
Domestic Subsidiary to be more than $10,000,000. Notwithstanding the foregoing (subject, however,
to the proviso at the end of the immediately preceding sentence), the Borrower shall cause any new
Domestic Subsidiary created or acquired at any time prior to the Maturity Date to become a party to
the Guarantee and Collateral Agreement for purposes of causing such new Domestic Subsidiary to
become a Subsidiary Guarantor and shall take or cause such new Domestic Subsidiary to take such
other actions as are described in subclauses (iii)(C) and (iv) above.

          (c)   During any Capital Stock Security Period, with respect to any new Foreign Subsidiary
(other than an Excluded Foreign Subsidiary) created or acquired after the Closing Date by the
Borrower or any of its Subsidiaries and with respect to each new Foreign Subsidiary Borrower,
promptly (i) execute and deliver to the Administrative Agent such amendments to the applicable
Security Document or execute such additional Security Documents as the Administrative Agent deems
necessary or advisable to grant to the Administrative Agent, for the benefit of the Lenders, a
perfected first priority

 

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security interest in the Capital Stock of such new Foreign Subsidiary or Foreign Subsidiary
Borrower that is owned by the Borrower or any of its Domestic Subsidiaries or any Foreign
Subsidiary Borrower (in the case of such Foreign Subsidiary Borrower or first-tier Subsidiaries of
any Foreign Subsidiary Borrower, to secure the obligations of such Foreign Subsidiary Borrower
hereunder), (ii) deliver to the Administrative Agent the certificates representing such Capital
Stock, together with undated stock powers, in blank, executed and delivered by a duly authorized
officer of the Borrower or such Subsidiary, as the case may be, (iii) in the case of a new Foreign
Subsidiary Borrower, cause such new Foreign Subsidiary Borrower (A) to become a party to the
applicable Security Document, and (B) to take such actions necessary or advisable to grant to the
Administrative Agent for the benefit of the Lenders a perfected first priority security interest in
the Capital Stock of its Subsidiaries (other than Excluded Foreign Subsidiaries) if such Foreign
Subsidiary Borrower is a check the box entity or a similar pass through entity, and (iv) if
requested by the Administrative Agent, deliver to the Administrative Agent legal opinions relating
to the matters described above, which opinions shall be in form and substance, and from counsel,
reasonably satisfactory to the Administrative Agent, provided that, if the initial
investment in or purchase price of such new Foreign Subsidiary or Foreign Subsidiary Borrower (as
applicable) is less than $10,000,000, the obligations of the Borrower discussed in clauses (i)
through (iv) of this subsection 6.11(b) shall not take effect unless and until the financial
statements delivered to the Administrative Agent following the end of each fiscal year of the
Borrower pursuant to subsection 6.1(a) show the tangible net worth of such new Foreign Subsidiary
or Foreign Subsidiary Borrower (as applicable) to be more than $10,000,000. For purposes of this
Agreement, (i) a check the box entity shall mean an entity that has elected to be, or is by
default, an entity that is disregarded as a separate entity from its U.S. parent or owner for U.S.
federal income tax consequences, and (ii) a “pass through entity” shall mean an entity that has
elected to be, or is by default, treated as a partnership for U.S. federal income tax consequences.

          (d)   During any Capital Stock Security Period, with respect to any new Excluded Foreign
Subsidiary owned by the Borrower or any of its Domestic Subsidiaries or by any Foreign Subsidiary
Borrower that is a check the box entity or a pass through entity created or acquired after the
Closing Date by the Borrower or any of its Subsidiaries, promptly (i) execute and deliver to the
Administrative Agent such amendments to the applicable Security Document as the Administrative
Agent deems necessary or advisable to grant to the Administrative Agent, for the benefit of the
Lenders, a perfected first priority security interest in the Capital Stock of such new Subsidiary
that is owned by the Borrower or any of its Domestic Subsidiaries or by such a Foreign Subsidiary
Borrower (provided that in no event shall more than 65% of the total outstanding voting Capital
Stock of any such new Subsidiary be required to be so pledged), (ii) deliver to the Administrative
Agent the certificates representing such voting Capital Stock, together with undated stock powers,
in blank, executed and delivered by a duly authorized officer of the Borrower or such Subsidiary,
as the case may be, and take such other action as may be necessary or, in the opinion of the
Administrative Agent, desirable to perfect the Administrative Agent’s security interest therein,
and (iii) if requested by the Administrative Agent, deliver to the Administrative Agent legal
opinions relating to the matters described above, which opinions shall be in form and substance,
and from counsel, reasonably satisfactory to the Administrative Agent, provided that, if
the initial investment in or purchase price of such new Excluded Foreign Subsidiary is less than
$10,000,000, the obligations of the Borrower discussed in clauses (i) through (iii) of this
subsection 6.11(c) shall not take effect unless and until the financial statements delivered to the
Administrative Agent following the end of each fiscal year of the Borrower pursuant to subsection
6.1(a) show the tangible net worth of such new Excluded Foreign Subsidiary to be more than
$10,000,000.

          6.12   Environmental, Health and Safety Matters.

          (a)   Comply with, and ensure compliance by all tenants and subtenants, if any, with, all
applicable Environmental Laws, including, without limitation, obtaining and complying with and

 

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maintaining, and ensuring that all tenants and subtenants obtain and comply with and maintain,
any and all licenses, approvals, notifications, registrations or permits required by applicable
Environmental Laws. For purposes of this 6.12 (a), noncompliance by the Borrower or any of its
Subsidiaries with any applicable Environmental Law shall be deemed not to constitute a breach of
this covenant provided that, upon learning of any actual or suspected noncompliance, the Borrower
and the relevant Subsidiaries shall promptly undertake all reasonable efforts to achieve compliance
(or contest in good faith by appropriate proceedings the applicable Environmental Law at issue and
(to the extent required by GAAP) provide on the books of the Borrower or any of its Subsidiaries,
as the case may be, reserves in conformity with GAAP with respect thereto), and provided
further that, in any case, such non-compliance, and any other noncompliance with
Environmental Law, individually or in the aggregate, could not reasonably be expected to result in
a Material Environmental Amount.

          (b)   Conduct and complete all investigations, studies, sampling and testing, and all
remedial, removal and other actions required under Environmental Laws and promptly comply with all
lawful orders and directives of all Governmental Authorities regarding Environmental Laws, except
to the extent that the amount or validity thereof is currently being contested in good faith by
appropriate proceedings and (to the extent required by GAAP) reserves in conformity with GAAP with
respect thereto have been provided on the books of the Borrower or any of its Subsidiaries, as the
case may be.

          (c)   Defend, indemnify and hold harmless the Administrative Agent and the Lenders, and their
respective parents, subsidiaries, affiliates, employees, agents, officers and directors, from and
against any claims, demands, penalties, fines, liabilities, settlements, damages, costs and
expenses of whatever kind or nature known or unknown, contingent or otherwise, arising out of, or
in any way relating to the violation of, noncompliance with or liability under any Environmental
Laws applicable to the Borrower or any of its Subsidiaries or any of their respective operations or
properties, or any orders, requirements or demands of Governmental Authorities related thereto,
including, without limitation, attorney’s and consultant’s fees, investigation and laboratory fees,
response costs, court costs and litigation expenses, except to the extent that any of the foregoing
arise out of the gross negligence or willful misconduct of the party seeking indemnification
therefor. This indemnity shall continue in full force and effect regardless of the termination of
this Agreement.

          6.13   Foreign Pledge Agreements. Use commercially reasonable
efforts to, within 60 days after the Closing Date, deliver to the Administrative Agent (a)(i) the
duly executed Foreign Pledge Agreements described in part I of Schedule 6.13 granting to the
Administrative Agent, for the benefit of the Lenders, a perfected first priority security interest
in the Capital Stock of such Foreign Subsidiaries and (ii) the certificates representing the
Capital Stock of such Foreign Subsidiaries, together with undated stock powers, in blank, executed
and delivered by a duly authorized officer of the Borrower or relevant Subsidiary, (b) the duly
executed Foreign Pledge Agreement Acknowledgment and Confirmation described in part II of Schedule
6.13 or any such deed of confirmation or other document as may be reasonably acceptable to the
Administrative Agent and (c) legal opinions relating to the matters described above, which opinions
shall be in form and substance, and from counsel, reasonably satisfactory to the Administrative
Agent.

          SECTION 7. NEGATIVE COVENANTS

          The Borrower hereby agrees that, from the Closing Date and so long as the Revolving Credit
Commitments remain in effect, any Letter of Credit is outstanding or any amount is owing to any
Lender or the Administrative Agent hereunder or under any other Loan Document, the Borrower shall
not, nor shall it permit any of its Subsidiaries to, directly or indirectly:

 

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          7.1   Limitation on Liens. Create, incur, assume or suffer to exist
any Lien upon any of its property, assets or revenues, whether now owned or hereafter acquired,
except:

     (a)   Liens securing Indebtedness in an aggregate amount not exceeding $75,000,000 at
any time outstanding in respect of (i) capitalized lease obligations and purchase money
obligations for fixed or capital assets; provided that (x) such Liens do not at any
time encumber any property other than the property financed by such Indebtedness and (y) the
Indebtedness secured thereby shall not exceed the cost or fair market value, whichever is
lower, of the property being acquired on the date of acquisition and (ii) Indebtedness
permitted pursuant to subsection 7.5(k);

     (b)   Liens on assets of a Foreign Subsidiary which is not a Foreign Subsidiary
Borrower to secure Permitted Foreign Debt of such Foreign Subsidiary; provided that
such Permitted Foreign Debt is not guaranteed by the Borrower;

     (c)   Liens for taxes and special assessments not yet due or which are being contested
in good faith and by appropriate proceedings if adequate reserves with respect thereto are
maintained on the books of the Borrower and its Subsidiaries in accordance with GAAP;

     (d)   carriers’, warehousemen’s, mechanics’, materialmen’s, repairmen’s, or other like
Liens arising in the ordinary course of business which are not overdue for a period of more
than 30 days or which are being contested in good faith and by appropriate proceedings;

     (e)   pledges or deposits in connection with workmen’s compensation, unemployment
insurance and other social security legislation;

     (f)   deposits to secure the performance of bids, trade contracts (other than for
borrowed money), leases, statutory and other obligations required by law, surety and appeal
bonds, performance bonds and other obligations of a like nature incurred in the ordinary
course of business;

     (g)   easements, rights-of-way, restrictions and other similar encumbrances incurred in
the ordinary course of business and other Liens incurred in the ordinary course of business
which, in the aggregate, are not substantial in amount, and which do not in any case
materially detract from the value of the property subject thereto or interfere with the
ordinary conduct of the business of the Borrower or its Subsidiaries;

     (h)   Liens resulting from judgments of any court or governmental proceeding, provided
such Liens in the aggregate do not constitute an Event of Default under subsection 8(h);

     (i)   Liens in existence on the Closing Date described in Schedule 7.1(i);

     (j)   Liens of landlords or of mortgagees of landlords, arising solely by operation of
law, on fixtures located on premises leased in the ordinary course of business,
provided that the rental payments secured thereby are not yet due;

     (k)   Liens contemplated under Section 4.12 of the Existing Senior Subordinated Note
Indenture;

     (l)   Liens created on Sold Receivables under any Receivables Purchase Facility;

 

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     (m)   Liens created by or pursuant to this Agreement or the other Loan Documents;

     (n)   Liens on assets of Foreign Subsidiaries arising by operation of law or pursuant
to customary business practice and not known to the Borrower to materially affect the value
of such assets; and

     (o)   purchase money Liens on assets acquired with seller-financed Indebtedness
permitted pursuant to subsection 7.5(n), so long as such Liens encumber only assets (and
proceeds thereof) acquired with such Indebtedness and do not secure any other Indebtedness.

          7.2   Limitation on Contingent Obligations. Agree to or assume,
guarantee, indorse or otherwise in any way be or become responsible or liable for, directly or
indirectly, any Contingent Obligation except for (i) the guarantees contemplated by the Security
Documents, (ii)(x) guarantees by the Borrower of Indebtedness of Foreign Subsidiary Borrowers in an
aggregate amount not to exceed $75,000,000 at any one time outstanding and (y) guarantees by the
Borrower of Permitted Foreign Debt of any Foreign Subsidiary, provided that such Permitted
Foreign Debt is not secured by any Liens, (iii) guarantees in existence on the Closing Date as
described in Schedule 7.2(iii), (iv) Contingent Obligations in an aggregate amount not to exceed
$100,000,000 at any one time outstanding, (v) Contingent Obligations of any Subsidiary Guarantor in
respect of Indebtedness permitted under subsections 7.5(e) or 7.5(f), provided that such
Contingent Obligations are subordinated to the same extent as the obligations of the Borrower in
respect of the related Indebtedness, (vi) any guarantees of the Borrower or any of its Subsidiaries
under subsection 5.1(b), (vii) any guarantee of the obligations of the Borrower by its Subsidiaries
of Indebtedness in respect of the Existing Senior Subordinated Notes; provided that such
Contingent Obligations are subordinated to the same extent as the obligations of the Borrower in
respect of the related Indebtedness or (viii) guarantees by the Borrower of operating lease
obligations of any Domestic Subsidiary incurred in connection with “build to suit” real property
improvements in an aggregate amount not to exceed $60,000,000, or (ix) without duplication of
subclause (viii) above, guarantees by the Borrower or any Subsidiary of any obligation of the
Borrower or any Subsidiary other than an obligation constituting Indebtedness.

     7.3   Limitation on Fundamental Changes. Except as permitted or
contemplated by this Agreement or any other Loan Document, enter into any transaction of merger or
consolidation or amalgamation, or liquidate, wind up or dissolve itself (or suffer any liquidation
or dissolution), convey, sell, lease, transfer or otherwise dispose of, in one transaction or a
series of transactions, all or any material part of its business or assets, whether now owned or
hereafter acquired, or acquire by purchase or otherwise all or substantially all the business or
assets of, or stock or other evidence of beneficial ownership of, any Person, or make any material
change in the method by which it conducts business, except that:

     (a)   any Subsidiary of the Borrower may be merged, amalgamated or consolidated with or
into the Borrower or any wholly owned Subsidiary of the Borrower (provided that in
the case of each such merger or consolidation, the Borrower or such wholly owned Subsidiary,
as the case may be, shall be the continuing or surviving corporation);

     (b)   any Subsidiary of the Borrower may be liquidated, wound up or dissolved into, or
all or substantially all, or such lesser amount thereof as the Borrower shall determine, of
its business, property or assets may be conveyed, sold, leased, transferred or otherwise
disposed of, in one transaction or a series of transactions, to, (i) the Borrower or any
wholly owned Subsidiary of the Borrower (provided that such wholly owned Subsidiary
shall be a Subsidiary Guarantor) or (ii) to any other Person in compliance with subsection
7.8; and

 

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     (c)   the Borrower or any Subsidiary of the Borrower may acquire by purchase or
otherwise all or substantially all the business or assets of, or stock or other evidence of
beneficial ownership of, any Person (including, without limitation, any Affiliate of the
Borrower), provided that such acquisition shall be a Permitted Acquisition.

          7.4   Limitation on Acquisitions, Investments, Loans and Advances.
Make or commit to make any advance, loan, extension of credit or capital contribution to, or
purchase of stock, bonds, notes, debentures or other securities of any Person, or make any other
investment in any Person, except:

     (a)   investments in Cash Equivalents;

     (b)   loans and advances to officers and directors of the Borrower or any of its
Subsidiaries (or employees thereof or manufacturers’ representatives provided such loans and
advances are approved by an officer of the Borrower) for travel, entertainment and
relocation expenses in the ordinary course of business in an aggregate amount not to exceed
$5,000,000 at any one time outstanding;

     (c)   loans and advances to and investments in the Borrower or its Subsidiaries
including loans made by Scotts Treasury EEIG to any Foreign Subsidiary;

     (d)   investments in notes and other securities received in the settlement of overdue
debts and accounts payable in the ordinary course of business and for amounts which,
individually or in the aggregate, are not material to the Borrower and its Subsidiaries
taken as a whole;

     (e)   Permitted Acquisitions in an aggregate amount not to exceed $100,000,000 in any
fiscal year; provided any amount not used for Permitted Acquisitions in the fiscal
year for which it was initially permitted may be carried forward to be used for Permitted
Acquisitions or investments permitted by subsection 7.4(g) in the next succeeding fiscal
year or ;

     (f)   insofar as not otherwise permitted pursuant to preceding clauses (a) through (e),
loans to or investments in Affiliates in an aggregate amount not to exceed $20,000,000 at
any one time outstanding;

     (g)   investments in the Capital Stock of a joint venture entity that is a United
States Person in an aggregate amount not to exceed the greater of (x) $250,000,000 and (y)
7.5% of Consolidated Total Assets, in either case plus any amounts permitted to be
carried forward from the prior fiscal year from subsection7.4(e) and not invested in
Permitted Acquisitions in such fiscal year; provided that the amount of such
investments permitted pursuant to this subsection 7.4(g) shall be reduced by the aggregate
amount of non-cash consideration received in respect of Dispositions permitted pursuant to
subsection 7.8;

     (h)   investments in the Capital Stock of a joint venture entity that is not a United
States Person;

     (i)   investments in the nature of seller financing of or other consideration received
in any Disposition by the Borrower or any of its Subsidiaries of any assets permitted by
subsection 7.8; and

     (j)   insofar as not otherwise permitted pursuant to preceding clauses (a) through (i),
investments in an aggregate amount not to exceed $50,000,000 at any one time outstanding.

 

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          7.5   Limitation on Indebtedness. Create, incur, assume or suffer
to exist any Indebtedness except:

     (a)   Indebtedness of any Loan Party pursuant to any Loan Document;

     (b)   Indebtedness of the Borrower to any Subsidiary and of any Subsidiary to the
Borrower or any other Subsidiary;

     (c)   Indebtedness outstanding on the date hereof and listed on Schedule 7.5(c)
(including the Existing Senior Subordinated Notes) and any refinancings, refundings,
renewals or extensions thereof (other than of the Existing Senior Subordinated Notes)
(without increasing, or shortening the maturity of, the principal amount thereof);

     (d)   Indebtedness (including, without limitation, Capital Lease Obligations) secured
by Liens permitted by subsection 7.1(a) in an aggregate principal amount not to exceed
$75,000,000 at any one time outstanding;

     (e)   unsecured Indebtedness of the Borrower having no scheduled principal payments or
prepayments prior to the date which is six months after the Maturity Date; provided
any such Indebtedness may be incurred only if the Borrower shall be in compliance, on a
pro forma basis after giving effect to such incurrence, with the covenant
contained in subsection 6.10 recomputed as at the last day of the most recently ended fiscal
quarter of the Borrower as if such incurrence had occurred on such day; provided
further, that any such unsecured Indebtedness which is subordinated shall be subject
to subordination provisions generally as favorable to the Lenders as those in the Existing
Senior Subordinated Note Indenture of the Borrower and shall not be subject to any maximum
limitation; and provided further, that the aggregate principal amount of any
such unsecured Indebtedness that is not subordinated as contemplated by the terms of the
immediately-preceding proviso shall not exceed $200,000,000 at any one time outstanding;

     (f)   unsecured Indebtedness of the Borrower having no scheduled principal payments or
prepayments prior to the date which is six months after the Maturity Date the proceeds of
which are used to finance Permitted Acquisitions; provided any such Indebtedness be
incurred only if the Borrower shall be in compliance, on a pro forma basis
after giving effect to such incurrence, with the covenant contained in subsection 6.10
recomputed as at the last day of the most recently ended fiscal quarter of the Borrower as
if such incurrence had occurred on such day;

     (g)   additional Indebtedness of the Borrower or any of its Subsidiaries in an
aggregate principal amount (for the Borrower and all Subsidiaries) not to exceed $50,000,000
at any one time outstanding;

     (h)   Indebtedness under Hedging Agreements, provided that such Hedging
Agreements are entered into in the ordinary course of business to hedge or mitigate risks as
to which the Borrower or any of its Subsidiaries reasonably believes it is exposed in the
conduct of its business or the management of its liabilities;

     (i)   Indebtedness contemplated by subsection 7.4(c);

     (j)   Indebtedness incurred by any Foreign Subsidiary, provided that the
aggregate principal amount of all such Indebtedness of all Foreign Subsidiaries which are
not Subsidiary Guarantors or Foreign Subsidiary Borrowers shall not exceed $60,000,000 or
the equivalent

 

72

thereof at any one time outstanding (any Indebtedness incurred pursuant to this
subsection 7.5(j), “Permitted Foreign Debt”); and

     (k)   Indebtedness of any Person that becomes a Subsidiary of the Borrower in a
Permitted Acquisition or Indebtedness otherwise assumed by the Borrower or any of its
Subsidiaries in connection with a Permitted Acquisition in an aggregate principal amount for
all such Indebtedness not to exceed $30,000,000 at any one time outstanding;

     (l)   Indebtedness incurred by any Foreign Subsidiary supported by a Letter of Credit
(“Supported Foreign Indebtedness”), provided that the aggregate principal
amount of all such Indebtedness shall not exceed $65,000,000 at any one time outstanding;

     (m)   to the extent that the Receivables Subsidiary’s or any other Person’s obligation
to purchase or acquire Sold Receivables under any Receivables Purchase Facility is deemed to
be an obligation to lend money to the Borrower or such Receivables Subsidiary, Indebtedness
of the Borrower or such Receivables Subsidiary under any Receivables Purchase Facility in an
aggregate principal amount not to exceed $300,000,000 at any one time outstanding; and

     (n)   seller-financed Indebtedness incurred by the Borrower or any of its Subsidiaries
in an aggregate principal amount not to exceed $100,000,000 at any one time outstanding.

          7.6   Limitation on Restrictions on Subsidiary Distributions. Enter
into or suffer to exist or become effective any consensual encumbrance or restriction on the
ability of any Subsidiary of the Borrower which is not a Subsidiary Guarantor (other than a
Receivables Subsidiary in connection with a Receivables Purchase Facility) to (a) pay dividends or
make any other distributions in respect of any Capital Stock of such Subsidiary held by, or pay any
Indebtedness owed to, the Borrower or any other Subsidiary of the Borrower, (b) pay dividends or
make any other distributions from a Foreign Subsidiary which is not a Subsidiary Guarantor or a
Subsidiary Borrower except in agreements governing Permitted Foreign Debt, (c) make loans or
advances to the Borrower or any other Subsidiary of the Borrower or (d) transfer any of its assets
to the Borrower or any other Subsidiary of the Borrower, except for such encumbrances or
restrictions existing under or by reason of any restrictions with respect to such Subsidiary
imposed pursuant to an agreement which has been entered into in connection with the sale or
disposition of all or substantially all of the Capital Stock or assets of such Subsidiary.

          7.7   Transactions with Affiliates and Officers. Except for
transactions associated with the relocation expenses of officers of the Borrower in the ordinary
course of business, (a) enter into any transaction, including, without limitation, the purchase,
sale or exchange of property or the rendering of any services, with any Affiliate or any executive
officer or director thereof, or enter into, assume or suffer to exist any employment or consulting
contract with any Affiliate or any executive officer or director thereof, except any transaction or
contract which is in the ordinary course of the Borrower’s or such Subsidiary’s business and which
is upon fair and reasonable terms no less favorable to the Borrower or such Subsidiary than it
would obtain in a comparable arm’s length transaction with a Person not an Affiliate, (b) make any
advance or loan to any Affiliate (except as otherwise made pursuant to subsection 7.4) or any
director or executive officer thereof or to any trust of which any of the foregoing is a
beneficiary, or to any Person on the guarantee of any of the foregoing or (c) pay any fees (other
than reasonable directors’ fees or expenses) or expenses to, or reimburse or assume any obligation
for the reimbursement of any expenses incurred by, any Affiliate or any executive officer or
director thereof.

          7.8   Limitation on Sale of Assets. Except as permitted or
contemplated by this Agreement or any other Loan Document, Dispose of any of its Domestic Assets
(including, without limitation, receivables and leasehold interests, but excluding obsolete or worn
out property or property

 

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(including inventory) Disposed of in the ordinary course of business) with a fair market value
(in combination with any other Domestic Assets sold in the same or any related transaction) in
excess of $10,000,000, whether now owned or hereafter acquired, except that the Borrower or any of
its Subsidiaries may Dispose of:

     (a)   Domestic Assets, provided that the aggregate fair market value of all
such Domestic Assets in all such transactions after giving pro forma effect
to such Disposal shall not exceed 20% of Consolidated Total Assets (calculated by
aggregating the percentage of Consolidated Total Assets represented by each Disposal at the
time of such Disposal); and

     (b)   Sold Receivables pursuant to any Receivables Purchase Facility;

provided that, in the case of any such Disposition pursuant to subclause (a) above
(including, without limitation, any Disposition for which the Borrower received as consideration
the Capital Stock of a joint venture entity), the Borrower shall receive cash consideration equal
to at least 80% of the fair market value of the Disposed assets except to the extent that the
non-cash consideration received in such Disposition in excess of 20% of the aggregate total
consideration received in such Disposition, together with the aggregate value of the non-cash
consideration received in any prior Disposition in excess of 20% of the total consideration
therefor and the aggregate amount of other investments in joint venture interests permitted
pursuant to subsection 7.4(g) since the date hereof (valued as of the date of receipt thereof)
shall not exceed 7.5% of Consolidated Total Assets, plus any permitted carryover from
subsection 7.4(e).

          7.9   Sale and Leaseback. Enter into any arrangement with any
Person providing for the leasing by the Borrower or any of its Subsidiaries of real or personal
property which has been or is to be sold or transferred by the Borrower or any such Subsidiary to
such Person or to any other Person to whom funds have been or are to be advanced by such Person on
the security of such property or rental obligations of the Borrower or any such Subsidiary, except
with respect to (i) such transactions described on Schedule 7.9 and (ii) any other such
transactions which shall not have an aggregate fair market value in excess of $75,000,000 since the
Closing Date.

          7.10   Fiscal Year. Permit the fiscal year of the Borrower and its
Subsidiaries to end on a day other than September 30; provided, that after the Closing
Date, the Borrower may, on one occasion, permanently change the date on which the fiscal year of
the Borrower and its Subsidiaries ends upon 30 days prior written notice to the Administrative
Agent.

          7.11   Modifications of Certain Debt Instruments. Amend, , modify,
waive or otherwise change, or consent or agree to any amendment, modification, waiver or other
change to, any of the terms of the Existing Senior Subordinated Notes or any other unsecured or
subordinated notes (or any refinancing thereof) issued pursuant to subsections 7.5(c), (e) or (f)
(other than any such amendment, modification, waiver or other change that (i)(x) would extend the
maturity or reduce the amount of any payment of principal thereof or reduce the rate or extend any
date for payment of interest thereon and (y) does not involve the payment of a consent fee material
in proportion to the outstanding principal amount thereof or (z) is no more restrictive to the
Borrower and not adverse to the Lenders or (ii) provides for actions which (x) are expressly
permitted under this Agreement and (y) do not require the consent of any of the holders of the
Existing Senior Subordinated Notes or unsecured or subordinated notes (or refinancing thereof)
issued pursuant to subsections 7.5(e); or (c) designate any Indebtedness (other than obligations of
the Loan Parties pursuant to the Loan Documents) as “Designated Senior Indebtedness” for the
purposes of the Existing Senior Subordinated Note Indenture. Nothing in this Section 7.11 shall be
deemed to prohibit the optional prepayment, retirement, redemption, purchase, defeaseance or
exchange (or arranging therefor) of the Existing Senior Subordinated Notes or any Indebtedness
outstanding

 

74

pursuant to subsection 7.5(c), (e) or (f), which optional prepayment, retirement, redemption,
purchase, defeaseance or exchange shall be otherwise permitted by this Agreement.

          7.12   Negative Pledge Clauses. Enter into or suffer to exist or
become effective any agreement that prohibits or limits the ability of the Borrower or any of its
Subsidiaries to create, incur, assume or suffer to exist any Lien upon any of its property or
revenues, whether now owned or hereafter acquired, to secure its obligations under the Loan
Documents to which it is a party other than (a) this Agreement and the other Loan Documents; (b)
any agreements governing any purchase money Liens or Capital Lease Obligations otherwise permitted
hereby (in which case, any prohibition or limitation shall only be effective against the assets
financed thereby) and (c) any agreements governing any Receivables Purchase Facility provided that
such limitation shall only be effective against the Sold Receivables.

          7.13   Lines of Business. Engage to any material extent in any
business activities other than in the respective primary lines of business of the Borrower and its
Subsidiaries (which shall include any evolution or extension of business activities and any
business activities reasonably related to such primary lines of business conducted on the Closing
Date).

          7.14   Restricted Payments. Declare or pay any dividend (other than
dividends payable solely in common stock of the Person making such dividend) on, or make any
payment on account of, or set apart assets for a sinking or other analogous fund for, the purchase,
redemption, defeasance, retirement or other acquisition of, any of its Capital Stock, whether now
or hereafter outstanding, or make any other distribution in respect thereof, either directly or
indirectly, whether in cash or property or in obligations (collectively, “Restricted
Payments”), except that:

     (a)   any Subsidiary may make Restricted Payments to the Borrower or any Subsidiary;

     (b)   the Borrower may make repurchases of its Capital Stock deemed to occur upon the
exercise of stock options if such Capital Stock represents a portion of the exercise price
of such options or represents any income or employment tax withholding associated therewith;

     (c)   the Borrower may declare and pay a special dividend on the shares of its common
Capital Stock and/or repurchase shares of its common Capital Stock in an aggregate amount up
to $750,000,000 of (collectively, the “Repurchase”);

     (d)   so long as no Default or Event of Default has occurred and is continuing or would
result therefrom, the Borrower may declare and pay dividends on its Capital Stock (including
its preferred stock) in an aggregate amount of up to $55,000,000 in each fiscal year of the
Borrower; provided, that, if after giving effect to any such dividend the Leverage
Ratio (calculated on a pro forma basis as of the last day of the most
recently completed fiscal quarter, but including in the calculation thereof the Indebtedness
of the Borrower and its consolidated Subsidiaries after giving effect to the payment of such
dividends) is less than 2.5 to 1.0, the Borrower may declare and pay dividends on its
Capital Stock in an aggregate amount of up to $75,000,000 in each fiscal year;
provided further that the aggregate amount of dividends permitted by this
paragraph (c) for fiscal year 2007 shall be in addition to the amount of any special
dividend paid in connection with the Repurchase; and

     (e)   so long as no Default or Event of Default has occurred and is continuing or would
result therefrom, the Borrower may make a repurchase or redemption of shares of its Capital
Stock, so long as after giving effect to such repurchase or redemption the aggregate cost of
all such repurchases and redemptions in the fiscal year during which such repurchase or
redemption

 

75

is to occur is not greater than the amount set forth below opposite such fiscal year:

	 	 	 	 	 
	Fiscal Year	 	Repurchase/Redemption Amount
	2007
	 	$	10,000,000	 
	2008
	 	$	25,000,000	 
	2009
	 	$	75,000,000	 
	2010 and in
each fiscal
year
thereafter
	 	$	125,000,000	 

provided, that any originally permitted amounts not used for repurchases or
redemptions in any fiscal year listed above may be carried over to be used in the next
succeeding fiscal year; provided further that the amount listed above for
repurchases or redemptions permitted in fiscal year 2007 shall be in addition to the
Repurchase.

     SECTION 8. EVENTS OF DEFAULT

     Upon the occurrence of any of the following events:

     (a)   Payments. The Borrower or the relevant Subsidiary Borrower shall fail to
pay any principal of any Loan or any Reimbursement Obligation when any such amount becomes
due in accordance with the terms thereof or hereof (including, without limitation, all
amounts of L/C Obligations, whether or not the beneficiaries of the then outstanding Letters
of Credit shall have presented the documents required thereunder); or the Borrower or the
relevant Subsidiary Borrower shall fail to pay any interest on any Loan or any fee or other
amount payable hereunder, within five days after any such interest, fee or amount becomes
due in accordance with the terms thereof or hereof (including, without limitation, all
amounts of L/C Obligations, whether or not the beneficiaries of the then outstanding Letters
of Credit shall have presented the documents required thereunder); or

     (b)   Representations and Warranties. Any representation or warranty made or
deemed made by the Borrower or any of its Subsidiaries in any of the Loan Documents to which
it is a party or which is contained in any certificate, document or financial or other
statement furnished at any time under or in connection herewith or therewith shall prove to
have been incorrect in any material respect on or as of the date made or deemed made; or

     (c)   Certain Covenants. The Borrower shall default in the observance or
performance of any covenant or agreement contained in subsection 6.9 or 6.10; or

     (d)   Other Covenants. The Borrower or any of its Subsidiaries shall default
in the observance or performance of any covenant or agreement (i) contained in subsections
7.3, 7.5, 7.8, 7.9 or 7.14 and such default shall continue unremedied for a period of 10
days or (ii) contained in this Agreement or in any other Loan Document not referred to in
preceding clause (i) or subsection 8(c) and such default shall continue unremedied for a
period of 30 days; or

     (e)   Cross-Default. The Borrower or any of its Material Subsidiaries shall
(i) default in any payment of principal of or interest on any Indebtedness (other than the
Loans) or in the payment of any Contingent Obligation, the aggregate principal amount of
which exceeds $75,000,000, beyond the period of grace (not to exceed 30 days), if any,
provided in the instrument or agreement under which such Indebtedness or Contingent
Obligation was created; or

 

76

(ii) default in the observance or performance of any other agreement or condition
relating to any such Indebtedness or Contingent Obligation or contained in any instrument or
agreement evidencing, securing or relating thereto, or any other event shall occur or
condition exist, the effect of which default or other event or condition is to cause, or to
permit the holder or holders of such Indebtedness or beneficiary or beneficiaries of such
Contingent Obligation (or a trustee or agent on behalf of such holder or holders or
beneficiary or beneficiaries) to cause, with the giving of notice if required, such
Indebtedness to become due prior to its stated maturity or such Contingent Obligation to
become payable; or (iii) any such Indebtedness or Contingent Obligation shall be declared to
be due and payable, or required to be prepaid (other than by a regularly scheduled required
prepayment) prior to the stated maturity thereof; or

     (f)   Commencement of Bankruptcy or Reorganization Proceedings. (i)
The Borrower or any of its Material Subsidiaries shall commence any case, proceeding or
other action (A) under any existing or future law of any jurisdiction, domestic or foreign,
relating to bankruptcy, insolvency, reorganization or relief of debtors, seeking to have an
order for relief entered with respect to it, or seeking to adjudicate it a bankrupt or
insolvent, or seeking reorganization, arrangement, adjustment, winding-up, liquidation,
dissolution, composition or other relief with respect to it or its debts, or (B) seeking
appointment of a receiver, trustee, custodian or other similar official for it or for all or
any substantial part of its assets, or the Borrower or any of its Subsidiaries shall make a
general assignment for the benefit of its creditors; or (ii) there shall be commenced
against the Borrower or any of its Material Subsidiaries any case, proceeding or other
action of a nature referred to in clause (i) above which (A) results in the entry of an
order for relief or any such adjudication or appointment or (B) remains undismissed,
undischarged or unbonded for a period of 60 days; or (iii) there shall be commenced against
the Borrower or any of its Material Subsidiaries any case, proceeding or other action
seeking issuance of a warrant of attachment, execution, distraint or similar process against
all or any substantial part of its assets which results in the entry of an order for any
such relief which shall not have been vacated, discharged, or stayed or bonded pending
appeal within 60 days from the entry thereof; or (iv) the Borrower or any of its Material
Subsidiaries shall take any action in furtherance of, or indicating its consent to, approval
of, or acquiescence in, any of the acts set forth in clause (i), (ii) or (iii) above; or (v)
the Borrower or any of its Material Subsidiaries shall generally not, or shall be unable to,
or shall admit in writing its inability to, pay its debts as they become due; or

     (g)   ERISA. (i) Any Person shall engage in any “prohibited transaction” (as
defined in Section 406 of ERISA or Section 4975 of the Code) involving any Plan, (ii) any
“accumulated funding deficiency” (as defined in Section 302 of ERISA), whether or not
waived, shall exist with respect to any Plan, (iii) a Reportable Event shall occur with
respect to, or proceedings shall commence to have a trustee appointed, or a trustee shall be
appointed, to administer or to terminate, any Single Employer Plan, which Reportable Event
or institution of proceedings is, in the reasonable opinion of the Required Lenders, likely
to result in the termination of such Plan for purposes of Title IV of ERISA in a “distress
termination” (within the meaning of Section 4041(c) of ERISA), and, in the case of a
Reportable Event, the continuance of such Reportable Event unremedied for ten days after
notice of such Reportable Event pursuant to Section 4043(a), (c) or (d) of ERISA is given
or, in the case of institution of proceedings, the continuance of such proceedings for ten
days after commencement thereof, (iv) any Single Employer Plan shall terminate for purposes
of Title IV of ERISA in a “distress termination” (within the meaning of Section 4041(c) of
ERISA), (v) the Borrower or any Commonly Controlled Entity shall, or is, in the reasonable
opinion of the Required Lenders, likely to, incur any liability in connection with a
withdrawal from, or the Insolvency or Reorganization of, a Multiemployer Plan or (vi) any
other event or condition shall occur or exist with respect to a Single Employer Plan; and in
each case in clauses (i) through (vi) above, such event or condition, together with all
other such events or

 

77

conditions, if any, is reasonably likely to subject the Borrower or any of its
Subsidiaries to any tax, penalty or other liabilities in the aggregate material in relation
to the business, operations, property or financial or other condition of the Borrower and
its Subsidiaries taken as a whole; or

     (h)   Material Judgments. One or more judgments or decrees shall be entered
against the Borrower or any of its Material Subsidiaries involving in the aggregate a
liability (not covered by insurance) of $75,000,000 or more and all such judgments or
decrees shall not have been vacated, satisfied, discharged, or stayed or bonded pending
appeal within 60 days from the entry thereof; or

     (i)   Change in Control. (i) Any Person (other than one or more members of the
Control Group) shall at any time own, directly or indirectly shares representing more than
30% of the aggregate ordinary voting power represented by the issued and outstanding Capital
Stock of the Borrower or (ii) a “Change of Control” as defined in the Existing Senior
Subordinated Notes Indenture or any “Change of Control” as defined in any indenture
governing indebtedness permitted by subsections 7.5(e) or (f) or any event described with
similar terminology thereunder shall occur; or

     (j)   Effectiveness of the Security Documents. Any Security Document shall
cease for any reason to be in full force and effect in accordance with its terms or any
party thereto shall so assert in writing or any Lien on any material Collateral created by
any of the Guarantee and Collateral Agreements shall cease to be enforceable and of the same
effect and priority purported to be created thereby (other than pursuant to the terms and
conditions of this Agreement or the other Loan Documents); or

then, and in any such event, (a) if such event is an Event of Default specified in paragraph (f)
above with respect to the Borrower or any Subsidiary Borrower, automatically the Term Commitments
(if any), the Revolving Credit Commitments, the Swing Line Commitment and the L/C Commitment shall
immediately terminate and the Term Loan, the Revolving Credit Loans, the Swing Line Loans and the
Reimbursement Obligations hereunder (with accrued interest thereon), the maximum amount available
to be drawn under all outstanding Letters of Credit and all other amounts owing by the Borrower or
such Subsidiary Borrower, as the case may be, under this Agreement shall immediately become due and
payable, and (b) if such event is any Event of Default and is continuing, either or both of the
following actions may be taken (to the extent not already automatically taken pursuant to the
foregoing clause (a)): (i) with the consent of the Required Lenders, the Administrative Agent may
or upon the request of the Required Lenders, the Administrative Agent shall, by notice to the
Borrower, declare the Term Commitments (if any), the Revolving Credit Commitments, the Swing Line
Commitment and the L/C Commitment to be terminated forthwith, whereupon the Term Commitments (if
any), the Revolving Credit Commitments, the Swing Line Commitment and the L/C Commitment shall
immediately terminate; and (ii) with the consent of the Required Lenders, the Administrative Agent
may or upon the request of the Required Lenders, the Administrative Agent shall, by notice of
default to the Borrower, declare the Term Loan, the Revolving Credit Loans, the Swing Line Loans
and the Reimbursement Obligations hereunder (with accrued interest thereon), the maximum amount
available to be drawn under all outstanding Letters of Credit and all other amounts owing under
this Agreement to be due and payable forthwith, whereupon the same shall immediately become due and
payable. Any amounts paid by the Borrower in respect of such undrawn Letters of Credit shall be
returned to the Borrower after the last expiry date of the Letters of Credit and after all
Obligations under the Loan Documents have been paid in full.

          With respect to all Letters of Credit for which presentment for honor shall not have occurred
at the time of an acceleration pursuant to the preceding paragraph, the Borrower or the relevant

 

78

Subsidiary Borrower, as the case may be, shall at such time deposit in a cash collateral
account opened by the Administrative Agent an amount equal to the aggregate then undrawn and
unexpired amount of such Letters of Credit. Amounts held in such cash collateral account shall be
applied by the Administrative Agent to the payments of drafts drawn under such Letters of Credit,
and the unused portion thereof after all such Letters of Credit shall have expired or been fully
drawn upon, if any, shall be applied to repay other Obligations. After all such Letters of Credit
shall have expired or been fully drawn upon, all Reimbursement Obligations shall have been
satisfied and all other Obligations shall have been paid in full, the balance, if any, in such cash
collateral account shall be returned to the Borrower or such Subsidiary Borrower, as the case may
be.

          Except as expressly provided above in this Section 8, presentment, demand, protest and all
other notices of any kind are hereby expressly waived.

          SECTION 9. THE ADMINISTRATIVE AGENT

          9.1   Appointment.

          (a)   Each Lender hereby irrevocably designates and appoints JPMCB as the Administrative Agent
of such Lender under this Agreement and the other Loan Documents, and each such Lender hereby
irrevocably authorizes JPMCB, as the Administrative Agent for such Lender, to take such action on
its behalf under the provisions of this Agreement and the other Loan Documents and to exercise such
powers and perform such duties as are expressly delegated to the Administrative Agent by the terms
of this Agreement and the other Loan Documents, together with such other powers as are reasonably
incidental thereto. Notwithstanding any provision to the contrary elsewhere in this Agreement or
the other Loan Documents, the Administrative Agent shall not have any duties or responsibilities,
except those expressly set forth herein, or any fiduciary relationship with any Lender, and no
implied covenants, functions, responsibilities, duties, obligations or liabilities shall be read
into this Agreement or the other Loan Documents or otherwise exist against the Administrative
Agent.

          (b)   Any proceeds received by the Administrative Agent pursuant to the terms of any Guarantee
and Collateral Agreement shall be applied as provided in such Guarantee and Collateral Agreement.
Each Hedging Lender agrees that (i) if at any time it shall receive any proceeds pursuant to the
terms of either Guarantee and Collateral Agreement (other than through application by the
Administrative Agent in accordance with this subsection 9.1(b)), it shall promptly turn the same
over to the Administrative Agent for application in accordance with the provisions hereof and (ii)
it will not take or cause to be taken any action, including, without limitation, the commencement
of any legal or equitable proceedings, the purpose of which is or could be to give such Hedging
Lender any preference or priority against the other Lenders with respect to such proceeds.

          9.2   Delegation of Duties. The Administrative Agent may execute
any of its duties under this Agreement and the other Loan Documents by or through agents or
attorneys-in-fact and shall be entitled to advice of counsel concerning all matters pertaining to
such duties. The Administrative Agent shall not be responsible for the negligence or misconduct of
any agents or attorneys in-fact selected by it with reasonable care.

          9.3   Exculpatory Provisions. Neither the Administrative Agent nor
any of its officers, directors, employees, agents, attorneys-in-fact or affiliates shall be (i)
liable for any action lawfully taken or omitted to be taken by it or such Person under or in
connection with this Agreement or the other Loan Documents (except for its or such Person’s own
gross negligence or willful misconduct) or (ii) responsible in any manner to any of the Lenders for
any recitals, statements, representations or warranties

 

79

made by the Borrower or any relevant Subsidiary Borrower or any officer thereof contained in
this Agreement or the other Loan Documents or in any certificate, report, statement or other
document referred to or provided for in, or received by the Administrative Agent under or in
connection with, this Agreement or the other Loan Documents or for the value, validity,
effectiveness, genuineness, enforceability or sufficiency of this Agreement, any Notes or the other
Loan Documents or for any failure of the Borrower or any relevant Subsidiary Borrower to perform
its obligations hereunder or thereunder. The Administrative Agent shall not be under any
obligation to any Lender to ascertain or to inquire as to the observance or performance of any of
the agreements contained in, or conditions of, this Agreement or the other Loan Documents, or to
inspect the properties, books or records of the Borrower or any Subsidiary Borrower.

          9.4   Reliance by Administrative Agent. The Administrative Agent
shall be entitled to rely, and shall be fully protected in relying, upon any Note, writing,
resolution, notice, consent, certificate, affidavit, letter, cablegram, telegram, telecopy or
teletype message, statement, order or other document or conversation reasonably believed by it to
be genuine and correct and to have been signed, sent or made by the proper Person or Persons and
upon advice and statements of legal counsel (including, without limitation, counsel to the
Borrower), independent accountants and other experts selected by the Administrative Agent. The
Administrative Agent may deem and treat the payee of any Note as the owner thereof for all purposes
unless (a) a written notice of assignment, negotiation or transfer thereof shall have been filed
with the Administrative Agent and (b) the Administrative Agent shall have received the written
agreement of such assignee that such assignee is bound hereby as it would have been had it been an
original Lender party hereto, in each case in form and substance satisfactory to the Administrative
Agent. The Administrative Agent shall be fully justified in failing or refusing to take any action
under this Agreement or the other Loan Documents unless it shall first receive such advice or
concurrence of the Required Lenders as it deems appropriate or it shall first be indemnified to its
satisfaction by the Lenders against any and all liability and expense which may be incurred by it
by reason of taking or continuing to take any such action. The Administrative Agent shall in all
cases be fully protected in acting, or in refraining from acting, under this Agreement and the
other Loan Documents in accordance with a request of the Required Lenders, and such request and any
action taken or failure to act pursuant thereto shall be binding upon all the Lenders and all
future holders of the Loans. The Administrative Agent and the Issuing Lender shall not be required
to give any notice to any Person other than the Borrower or the applicable Subsidiary Borrower that
an automatic extension of a Letter of Credit shall not be effective, unless the Required Lenders
otherwise direct.

          9.5   Notice of Default. The Administrative Agent shall not be
deemed to have knowledge or notice of the occurrence of any Default or Event of Default hereunder
unless the Administrative Agent has received notice from a Lender or the Borrower or any Subsidiary
Borrower referring to this Agreement, describing such Default or Event of Default and stating that
such notice is a “notice of default”. In the event that the Administrative Agent receives such a
notice, the Administrative Agent promptly shall give notice thereof to the Lenders. The
Administrative Agent shall take such action with respect to such Default or Event of Default as
shall be reasonably directed by the Required Lenders; provided that, unless and until the
Administrative Agent shall have received such directions, the Administrative Agent may (but shall
not be obligated to) take such action, or refrain from taking such action, with respect to such
Default or Event of Default as it shall deem advisable in the best interests of the Lenders.

          9.6   Non-Reliance on Administrative Agent, Other Lenders and JPMCB.
Each Lender expressly acknowledges that neither the Administrative Agent nor any of its officers,
directors, employees, agents, attorneys-in-fact or affiliates (including, without limitation,
JPMCB) has made any representations or warranties to it and that no act by the Administrative Agent
hereinafter taken, including any review of the affairs of the Borrower or any Subsidiary Borrower,
shall be deemed to constitute any

 

80

representation or warranty by the Administrative Agent to any Lender. Each Lender represents
to the Administrative Agent and JPMCB that it has, independently and without reliance upon the
Administrative Agent or any other Lender or JPMCB, and based on such documents and information as
it has deemed appropriate, made its own appraisal of and investigation into the business,
operations, property, financial and other condition and creditworthiness of the Borrower and made
its own decision to make its extensions of credit hereunder and enter into this Agreement. Each
Lender also represents that it will, independently and without reliance upon the Administrative
Agent, JPMCB or any other Lender, and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit analysis, appraisals and decisions in
taking or not taking action under this Agreement or the other Loan Documents, and to make such
investigation as it deems necessary to inform itself as to the business, operations, property,
financial and other condition and creditworthiness of the Borrower. Except for notices, reports
and other documents expressly required to be furnished to the Lenders by the Administrative Agent
hereunder, the Administrative Agent shall not have any duty or responsibility to provide any Lender
with any credit or other information concerning the business, operations, property, financial and
other condition or creditworthiness of the Borrower which may come into the possession of the
Administrative Agent or any of its officers, directors, employees, agents, attorneys-in-fact or
affiliates.

          9.7   Indemnification. The Lenders agree to indemnify each of the
Administrative Agent and JPMCB in its capacity as such (to the extent not reimbursed by the
Borrower or any Subsidiary Borrower and without limiting the obligation of the Borrower or any
Subsidiary Borrower to do so), ratably according to the respective amounts of their Aggregate
Exposure in effect on the date on which indemnification is sought (or, if indemnification is sought
after the date upon which the Revolving Credit Commitments shall have terminated and the Loans
shall have been paid in full, ratably according to their Aggregate Exposure Percentage immediately
prior to such date), from and against any and all liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements of any kind whatsoever which
may at any time (including, without limitation, at any time following the payment of the Loans) be
imposed on, incurred by or asserted against the Administrative Agent or JPMCB in any way relating
to or arising out of this Agreement, any of the other Loan Documents, or any documents contemplated
by or referred to herein or therein or the transactions contemplated hereby or thereby or any
action taken or omitted by the Administrative Agent or JPMCB under or in connection with any of the
foregoing; provided that no Lender shall be liable for any payment of any such liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or
disbursements to the extent that they result from the Administrative Agent’s or JPMCB’s gross
negligence or willful misconduct. The agreements in this subsection shall survive the payment of
the Loans and all other amounts payable hereunder.

          9.8   Administrative Agent in Its Individual Capacity. The
Administrative Agent and its affiliates may make loans to, accept deposits from and generally
engage in any kind of business with the Borrower or any Subsidiary Borrower as though the
Administrative Agent were not the Administrative Agent hereunder. With respect to its Loans made
or renewed by it and any Note issued to it and with respect to any Letter of Credit issued or
participated in by it, the Administrative Agent shall have the same rights and powers under this
Agreement as any Lender and may exercise the same as though it were not the Administrative Agent,
and the terms “Lender” and “Lenders” shall include the Administrative Agent in its individual
capacity.

          9.9   Parallel Debt. (a) (i) Notwithstanding any other provision
of this Agreement, the Borrower and each Subsidiary Borrower hereby irrevocably and unconditionally
undertakes to pay to the Administrative Agent, as creditor in its own right and not as
representative of the other Lenders, sums equal to and in the currency of each amount payable by
the Borrower or such Subsidiary Borrower to each of the Lenders under each of the Loan Documents as
and when that amount falls due for payment under the relevant Loan Document or would have fallen
due but for any discharge resulting from failure

 

81

of another Lender to take appropriate steps, in insolvency proceedings affecting the Borrower
or such Subsidiary Borrower, to preserve its entitlement to be paid that amount.

     (ii) The Administrative Agent shall have its own independent right to demand payment of
the amounts payable by the Borrower and each Subsidiary Borrower under this subsection
9.9(a), irrespective of any discharge of the Borrower’s or a Subsidiary Borrower’s
obligation to pay those amounts to the other Lenders resulting from failure by them to take
appropriate steps, in insolvency proceedings affecting the Borrower or such Subsidiary
Borrower, to preserve their entitlement to be paid those amounts.

     (iii) Any amount due and payable by the Borrower or a Subsidiary Borrower to the
Administrative Agent under this subsection 9.9(a) shall be decreased to the extent that the
other Lenders have received (and are able to retain) payment in full of the corresponding
amount under the other provisions of the Loan Documents and any amount due and payable by
the Borrower or a Subsidiary Borrower to the other Lenders under those provisions shall be
decreased to the extent that the Administrative Agent has received (and is able to retain)
payment in full of the corresponding amount under this subsection 9.9(a).

     (iv) The rights of the Lenders (other than the Administrative Agent) to receive payment
of amounts payable by the Borrower and each Subsidiary Borrower under the Loan Documents are
several and are separate and independent from, and without prejudice to, the rights of the
Administrative Agent to receive payment under this subsection 9.9(a).

          (b)   All amounts from time to time received or recovered by the Administrative Agent under
subsection 9.9(a) and/or in connection with the realization and enforcement of all or any part of
the Security Documents shall be held by the Administrative Agent in trust to apply in accordance
with the terms of the Loan Documents.

          9.10   Successor Administrative Agent. The Administrative Agent may
resign as Administrative Agent upon 30 days’ notice to the Lenders. If the Administrative Agent
shall resign as Administrative Agent under this Agreement, then the Required Lenders shall appoint
from among the Lenders a successor agent for the Lenders (with, as long as no Event of Default has
occurred and is continuing, the approval of the Borrower, which approval shall not be unreasonably
withheld). Upon the acceptance of its appointment as Administrative Agent hereunder by a
successor, such successor agent shall succeed to the rights, powers and duties of the
Administrative Agent, and the term “Administrative Agent” shall mean such successor agent effective
upon its appointment, and the former Administrative Agent’s rights, powers and duties as
Administrative Agent shall be terminated, without any other or further act or deed on the part of
such former Administrative Agent or any of the parties to this Agreement or any holders of the
Loans. Any appointed successor agent shall act as Administrative Agent only through a branch in
the United States in respect of Facility A-1, Facility A-2, Facility B, Facility C or Facility D.
After any retiring Administrative Agent’s resignation hereunder as Administrative Agent, the
provisions of this Section 9 shall inure to its benefit as to any actions taken or omitted to be
taken by it while it was Administrative Agent under this Agreement.

          9.11   The Syndication Agent and the Documentation Agents. The
Syndication Agent and the Documentation Agents do not assume any responsibility or obligation under
this Agreement or any of the other Loan Documents or any duties as agents for the Lenders. The
titles “Syndication Agent” and “Documentation Agent” imply no fiduciary responsibility on the part
of either of the Syndication Agent or the Documentation Agents to any Person and the use of such
title does not impose on the Syndication Agent or the Documentation Agents any duties or
obligations under this Agreement or any of the other Loan Documents.

 

 

82

          SECTION 10. MISCELLANEOUS

          10.1   Amendments and Waivers.

          (a)   The Administrative Agent, the Borrower and the Subsidiary Borrowers may, from time to
time, with the written consent of the Required Lenders, enter into written amendments, supplements
or modifications for the purpose of adding any provisions to this Agreement or any other Loan
Document or changing in any manner the rights of the Lenders or the Borrower or any Subsidiary
Borrower hereunder or thereunder, and, with the consent of the Required Lenders, the Administrative
Agent, on behalf of the Lenders, may execute and deliver to the Borrower a written instrument
waiving, on such terms and conditions as the Administrative Agent may specify in such instrument,
any of the requirements of this Agreement or any other Loan Document or any Default or Event of
Default and its consequences; provided, however, that no such waiver and no such
amendment, supplement or modification shall (i) extend the final maturity of any Loan or reduce the
rate or extend the time of payment of interest or fees thereon, or reduce the principal amount
thereof, or extend the scheduled date or reduce the amount of any amortization payment in respect
of any Term Loan, or change the amount or terms of any Lender’s Commitment (including the Optional
Currencies applicable to such Lender) or reduce any outstanding L/C Obligation, or amend, modify or
waive any other provision hereof if the effect is to subordinate one of the Facilities in right of
payment to any other of the Facilities, in each case without the written consent of each Lender
affected thereby, (ii) amend, modify or waive any provision of this subsection (except as expressly
provided herein), or reduce the percentage specified in the definition of Required Lenders, or
consent to the assignment or transfer by the Borrower or any Subsidiary Borrower of any of its
rights and obligations under this Agreement or any other Loan Document (except to the extent
otherwise provided therein), or release the guarantee obligations of all or substantially all of
the Guarantors or all or substantially all of the collateral under the Security Documents, in each
case without the written consent of each Lender, (iii) amend, modify or waive any provision of
Section 9 without the written consent of the then Administrative Agent, or (iv) amend, modify or
waive the provisions of any Letters of Credit or Reimbursement Obligation, without the written
consent of the Borrower or the relevant Subsidiary Borrower and the Issuing Lender, or the
provisions applicable to the Swing Line Loans without the consent of each Swing Loan Lender. Any
such waiver and any such amendment, supplement or modification shall be binding upon the Borrower,
the Subsidiary Borrowers, the Lenders and all future holders of the Loans. In the case of any
waiver, the Borrower and the Lenders shall be restored to their former position and rights
hereunder and under the other Loan Documents, and any Default or Event of Default waived shall be
deemed to be cured and not continuing; but no such waiver shall extend to any subsequent or other
Default or Event of Default or impair any right consequent thereon.

          (b)   This Agreement may be amended without consent of the Lenders, so long as no Default or
Event of Default shall have occurred and be continuing, as follows:

     (i) This Agreement will be amended to add Subsidiaries as additional Subsidiary
Borrowers (which in the case of a Foreign Subsidiary, may at such time be designated
by the Borrower as a Regular Subsidiary Borrower) upon (x) execution and delivery by
the Borrower, such additional Subsidiary Borrowers and the Administrative Agent, of
a Joinder Agreement, substantially in the form of Exhibit K (a “Joinder 
Agreement”), providing for such Subsidiaries to become Subsidiary
Borrowers, (y) agreement and acknowledgment by the Borrower and such additional
Subsidiaries that the Guarantee and Collateral Agreement covers the obligations of
such additional Subsidiaries and (z) delivery to the Administrative Agent of (1)
corporate or other applicable resolutions, other corporate or other applicable
documents, certificates and legal opinions in respect of such additional Subsidiary
Borrowers substantially equivalent

 

83

to comparable documents delivered on the Closing
Date and (2) such other documents with respect thereto as the Administrative Agent
shall reasonably request; provided that no Lender shall be required to make
Extensions of Credit to any Foreign Subsidiary Borrower if the laws or regulations
of any Governmental Authority would prohibit it from doing so on the basis of such
Lender’s or such Foreign Subsidiary’s jurisdiction or of organization.

     (ii) This Agreement will be amended to remove any Subsidiary as a Subsidiary
Borrower upon execution and delivery by the Borrower to the Administrative Agent of
a written notification to such effect and repayment in full of all Loans made to
such Subsidiary Borrower, cash collateralization of all L/C Obligations in respect
of Letters of Credit issued for the account of such Subsidiary Borrower and
repayment in full of all other amounts owing by such Subsidiary Borrower under this
Agreement and the other Loan Documents (it being agreed that any such repayment
shall be in accordance with the other terms of this Agreement).

     (iii) This Agreement may be amended, modified or supplemented as contemplated
by subsection 2.27.

          (c)   The Lenders (and each of their respective successors, assigns and transferees) hereby
authorize the Administrative Agent to release any Collateral or the obligations of any Subsidiary
under this Agreement or any Security Document on their behalf in the event of (i) a sale or other
transfer of such Collateral or such Subsidiary permitted under this Agreement or any such Security
Document or (ii) the release of such Collateral as provided in this Agreement or any such Security
Document.

          (d)   Notwithstanding any other provision herein, the terms and provisions of Annex B, C or D
may be amended, supplemented, modified or waived in any manner which could not reasonably be
considered as adversely affecting in any material respect the benefits hereof and the rights and
remedies hereunder of the other Lenders with the consent of the Borrower, the Administrative Agent
and the Sterling Lenders, the Australian Dollar Lenders or the Canadian Dollar Lenders, as the case
may be.

          10.2 Notices. Except as provided in subsections 2.2 and 2.3, all
notices, requests and demands to or upon the respective parties hereto to be effective shall be in
writing or by telecopy and, unless otherwise expressly provided herein, shall be deemed to have
been duly given or made when delivered by hand, or when deposited in the mail, postage prepaid, or,
in the case of telecopy notice, when received, addressed as follows in the case of the Borrower and
each of the Subsidiary Borrowers and the Administrative Agent, and as set forth in Schedule 10.2 in
the case of the Lenders, or to such address or other address as may be hereafter notified by the
respective parties hereto and any future holders of the Loans:

	 	 	 
	The Borrower and
	 	 
	each Subsidiary Borrower:

	 	The Scotts Miracle-Gro Company
	 

	 	14111 Scottslawn Road
	 

	 	Marysville, Ohio 43041
	 

	 	Attention: Treasurer
	 

	 	Telephone: (937) 664-7221
	 

	 	Telecopy: (937) 578-5754

 

84

	 	 	 
	          With a copy sent to:

	 	Vorys, Sater, Seymour and Pease LLP
	 

	 	52 East Gay Street
	 

	 	Columbus, Ohio 43215
	 

	 	Attention: John B. Weimer, Esq. and
	 

	 	Stephen
D. Browning, Esq.

	 

	 	Telephone: (614) 464-8343
	 

	 	Telecopy: (614) 719-5086
	 
	 	 
	The Administrative Agent:

	 	JPMorgan Chase Bank, N.A.
	 

	 	270 Park Avenue
	 

	 	New York, New York 10017
	 

	 	Attention.: Randolph E. Cates
	 

	 	Telephone: (212) 270-8997
	 

	 	Telecopy: (212) 270-6041
	 
	 	 
	          With a copy sent to:

	 	J.P. Morgan Europe Limited
	 

	 	125 London Wall
	 

	 	London EC2Y 5AJ England
	 

	 	Attention: Sue Dalton, Agency Department
	 

	 	Telephone: +44 207 777 2542
	 

	 	Telecopy: +44 207 777 2360
	 
	 	 
	 

	 	JPMorgan Chase Bank, N.A.
	 

	 	Loan and Agency Services
	 

	 	1111 Fannin Street
	 

	 	10th Floor
	 

	 	Houston, Texas 77002
	 

	 	Attention: Sylvia Trevino
	 

	 	Telephone: (713) 750-3536
	 

	 	Telecopy: (713) 750-2932
	 
	 	 
	The Australian Administrative Agent:

	 	J.P. Morgan Australia Limited
	 

	 	Level 32, Grosvenor Place
	 

	 	225 George Street
	 

	 	Sydney NSW 2000 Australia
	 

	 	Attention: Jason M. Lock/Graham McKinley, Agency
	 

	 	Telephone: +61-(2)-9220-3162/1907
	 

	 	Telecopy: +61-(2)-9247-7698
	 
	          With a compy sent to:

	 	JPMorgan Chase Bank, N.A., Mumbai Mahakali
	 

	 	Caves Road, Chakala Junction
	 

	 	Floor 3
	 

	 	Mumbai 400093 India
	 

	 	Attention: Preetam D. Dalvi, Asia Loan Operations
	 

	 	Telephone: (91-22) 56953625
	 

	 	Telecopy: (91-22) 56954361

 

85

	 	 	 
	The Canadian Administrative Agent:

	 	J.P. Morgan Bank, N.A., Toronto Branch
	 

	 	200 Bay Street
	 

	 	Royal Bank Plaza, Floor 18
	 

	 	Toronto M57 2J2 Canada
	 

	 	Attention: Martha Tamayo
	 

	 	Telephone: (416) 981-9235
	 

	 	Telecopy: (416) 982-9128

provided that any notice, request or demand to or upon the Administrative Agent or the
Lenders shall not be effective until received.

          10.3  No Waiver; Cumulative Remedies. No failure to exercise and
no delay in exercising, on the part of the Administrative Agent or any Lender, any right, remedy,
power or privilege hereunder shall operate as a waiver thereof; nor shall any single or partial
exercise of any right, remedy, power or privilege hereunder preclude any other or further exercise
thereof or the exercise of any other right, remedy, power or privilege. The rights, remedies,
powers and privileges herein provided are cumulative and not exclusive of any rights, remedies,
powers and privileges provided by law.

          10.4  Survival of Representations, Warranties and Indemnities. All
representations and warranties made hereunder and in any document, certificate or statement
delivered pursuant hereto or in connection herewith shall survive the execution and delivery of
this Agreement and the making of the Loans hereunder. The obligation of the Borrower to make
payments or to provide indemnities as provided for in this Agreement shall survive payment in full
of the Loans, expiration of all Letters of Credit and termination of the Revolving Credit
Commitments and this Agreement.

          10.5  Payment of Expenses and Taxes. The Borrower agrees (a) to
pay or reimburse the Administrative Agent for all its reasonable and documented out-of-pocket costs
and expenses incurred in connection with the development, preparation and execution of, and any
amendment, supplement or modification to, this Agreement, the other Loan Documents and any other
documents prepared in connection herewith or
therewith, and the consummation of the transactions contemplated hereby and thereby,
including, without limitation, the reasonable fees and disbursements of counsel to the
Administrative Agent, (b) to pay or reimburse each Lender and the Administrative Agent for all its
costs and expenses incurred in connection with the enforcement or preservation of any rights under
this Agreement, the other Loan Documents and any such other documents, including, without
limitation, the reasonable fees and disbursements of counsel (including, without limitation,
in-house counsel) to the Administrative Agent and to the several Lenders, (c) to pay, indemnify and
hold each Lender and the Administrative Agent harmless from any and all recording and filing fees
and any and all liabilities with respect to, or resulting from any delay in paying, stamp, excise
and other similar non-income taxes (and, for the avoidance of doubt, other than Excluded Taxes), if
any, which may be payable or determined to be payable in connection with the execution and delivery
of, or consummation of any of the transactions contemplated by, or any amendment, supplement or
modification of, or any waiver or consent under or in respect of, this Agreement, the other Loan
Documents and any such other documents provided that and notwithstanding any other provision of
this Agreement to the contrary, the Borrower and/or any Subsidiary Borrower shall only be liable to
make any payment to the Administrative Agent or any Lender regarding any UK stamp duty or SDRT in
respect of any transfer if such transfer is effected by an Assignment and Acceptance which operates
as a novation, i.e., if the original rights and obligations as between the relevant Borrower and
the transferor Lender are extinguished and new rights and obligations between the relevant Borrower
and the transferee Lender are created, and (d) to pay, indemnify, and hold each Lender and the
Administrative Agent and their respective officers, directors, trustees, employees, advisers and
agents harmless from and against any and all other liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements of any kind or nature

 

86

whatsoever (including the reasonable legal fees and expenses of each Lender and the Administrative
Agent with respect to third party enforcement actions arising out of the transactions contemplated
under this Agreement and the other Loan Documents) with respect to the execution, delivery,
enforcement, performance and administration of this Agreement, the other Loan Documents and any
such other documents; provided, however, that with respect to subparagraphs (c) and (d), the
Borrower shall not be liable for the payment of any losses, costs, penalties, judgments, suits,
liabilities, damages, penalties, actions, expenses or disbursements resulting solely from the gross
negligence or willful misconduct of any such Lender. The agreements in this subsection shall
survive repayment of the Loans, the Reimbursement Obligations and all other amounts payable
hereunder.

          10.6  Successors and Assigns; Participations and Assignments. (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 the
Issuing Lender that issues any Letter of Credit), except that (i) 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) and (ii) no Lender may assign or otherwise transfer its rights or obligations
hereunder except in accordance with this Section.

          (b)   (i) Subject to the conditions set forth in paragraph (b)(ii) below, any Lender may
assign to one or more assignees (each, an “Assignee”) all or a portion of its rights and
obligations under this Agreement (including all or a portion of its Commitments and the Loans at
the time owing to it) with the prior written consent (such consent not to be unreasonably withheld
or delayed) of:

     (A) the Borrower, provided that no consent of the Borrower shall be required
for an assignment to a Lender, an affiliate of a Lender, an Approved Fund (as defined below)
or, if an Event of Default under Section 8(a) or (f) has occurred and is continuing, any
other Person;

     (B) the Administrative Agent, provided that no consent of the Administrative
Agent shall be required for an assignment of all or any portion of any Term Commitment or
Term Loan to a Lender, an Affiliate of a Lender or an Approved Fund; and

     (C) the Issuing Lender, provided that no consent of the Issuing Lender shall be
required for an assignment of all or any portion of any Term Commitment or Term Loan.

     (ii) Assignments shall be subject to the following additional conditions:

     (A) except in the case of an assignment to a Lender, an affiliate of a Lender or an
Approved Fund or an assignment of the entire remaining amount of the assigning Lender’s
Commitments or Loans under any Facility, the amount of the Commitments 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 Administrative Agent)
shall not be less than $5,000,000, or the Non-Dollar Currency Equivalent thereof, unless
each of the Borrower and the Administrative Agent otherwise consent, provided that
(y) no such consent of the Borrower shall be required if an Event of Default under Section
8(a) or (f) has occurred and is continuing and (z) such amounts shall be aggregated in
respect of each Lender and its affiliates or Approved Funds, if any; provided
further, that no such assignment of less than all of an assigning Lender’s
Commitments under a Revolving Facility shall reduce the assigning Lender’s Revolving Credit
Commitment to less than $5,000,000 or the Non-Dollar Currency Equivalent thereof or such
other amount as agreed upon by the Administrative Agent and the Borrower.

 

87

     (B) the parties to each assignment shall execute and deliver to the Administrative
Agent an Assignment and Acceptance, together with a processing and recordation fee of $3,500
(which fee shall be payable by Lenders party to such assignment);

     (C) the Assignee, if it shall not be a Lender, shall deliver to the Administrative
Agent an administrative questionnaire; and

     (D) the Assignee shall not be entitled to the benefits of subsection 2.22 unless the
Assignee complies with the applicable requirements set forth in subsection 2.22(b).

          For the purposes of this subsection 10.6, “Approved Fund” means any Person (other than
a natural person) that is engaged in making, purchasing, holding or investing in bank loans and
similar extensions of credit in the ordinary course of its business and that is administered or
managed by (a) a Lender, (b) an affiliate of a Lender or (c) an entity or an affiliate of an entity
that administers or manages a Lender.

          (iii) Subject to acceptance and recording thereof pursuant to paragraph (b)(iv) below, 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 (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
subsections 2.20, 2.21, 2.22 and 10.5). Any assignment or transfer by a Lender of rights or
obligations under this Agreement that does not comply with this subsection 10.6 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 (c) of this subsection.

          (iv) The Administrative Agent, acting for this purpose as an agent of the Borrower, shall
maintain at one of its offices 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 Commitments of, and
principal amount of the Loans and L/C Obligations owing to, each Lender pursuant to the terms
hereof from time to time (the “Register”). The entries in the Register shall, in the
absence of manifest error, be conclusive, and the Borrower, the Administrative Agent, the Issuing
Lender 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 Lender
and any Lender, at any reasonable time and from time to time upon reasonable prior notice.

          (v) 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 subsection and any written consent to such assignment required by paragraph (b) of this
subsection, the 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.

          (c)   (i) Any Lender may, without the consent of the Borrower or the Administrative Agent,
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 Commitments and the Loans owing to it); provided that (A) such Lender’s obligations
under this Agreement shall remain

 

88

unchanged, (B) such Lender shall remain solely responsible to the
other parties hereto for the performance of such obligations and (C) the Borrower, the
Administrative Agent, the Issuing Lender 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 pursuant to which a Lender sells such a participation shall provide that
such Lender shall retain the sole right to enforce this Agreement and to approve any amendment,
modification or waiver of any provision of this Agreement; provided that such agreement may
provide that such Lender will not, without the consent of the Participant, agree to any amendment,
modification or waiver that (1) requires the consent of each Lender directly affected thereby
pursuant to the proviso to the first sentence of subsection 10.1 and (2) directly affects such
Participant. Subject to paragraph (c)(ii) of this subsection, the Borrower agrees that each
Participant shall be entitled to the benefits of subsections 2.18, 2.19, 2.20 and 2.22 to the same
extent as if it were a Lender and had acquired its interest by assignment pursuant to paragraph (b)
of this subsection. To the extent permitted by law, each Participant also shall be entitled to the
benefits of subsection 10.7(b) as though it were a Lender.

          (ii) A Participant shall not be entitled to receive any greater payment under subsection 2.21
or 2.22 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. Any Participant shall not be entitled to the
benefits of subsection 2.22 unless such Participant complies with the applicable requirements set
forth in subsection 2.22(b).

          (d)   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 subsection 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.

          (e)   The Borrower, upon receipt of written notice from the relevant Lender, agrees to issue a
promissory note (a “Note”) to any Lender requiring Notes to facilitate transactions of the
type described in paragraph (d) above.

          10.7  Adjustments; Set-off.

          (a)   Except to the extent that this Agreement expressly provides for payments to be allocated
to a particular Lender or to the Lenders under a particular Facility, if any Lender (a
“Benefitted Lender”) shall, at any time after the Loans and other amounts payable hereunder
shall immediately become due and payable pursuant to Section 8, receive any payment of all or part
of the Obligations owing to it, or receive any collateral in respect thereof (whether voluntarily
or involuntarily, by set-off, pursuant to events or proceedings of the nature referred to in
Section 8(f), or otherwise), in a greater proportion than any such payment to or collateral
received by any other Lender, if any, in respect of the Obligations owing to such other Lender,
such Benefitted Lender shall purchase for cash from the other Lenders a participating interest in
such portion of the Obligations owing to each such other Lender, or shall provide such other
Lenders with the benefits of any such collateral, as shall be necessary to cause such Benefitted
Lender to share the excess payment or benefits of such collateral ratably with each of the Lenders;
provided, however, that if all or any portion of such excess payment or benefits is
thereafter recovered from such Benefitted Lender, such purchase shall be rescinded, and the
purchase price and benefits returned, to the extent of such recovery, but without interest.

 

89

          (b)   In addition to any rights and remedies of the Lenders provided by law, upon the
occurrence of an Event of Default and acceleration of the obligations owing in connection with this
Agreement, each Lender shall have the right, without prior notice to the Borrower or any Subsidiary
Borrower, any such notice being expressly waived by the Borrower to the extent permitted by
applicable law, to set off, appropriate and apply against any indebtedness, whether matured or
unmatured, of the Borrower or such Subsidiary Borrower to such Lender, any amount held by or owing
from such Lender to or for the credit or the account of the Borrower or such Subsidiary Borrower
at, or at any time after, the happening of any of the above mentioned events, and the aforesaid
right of set-off may be exercised by such Lender against the Borrower or such Subsidiary Borrower
or against any trustee in bankruptcy, debtor in possession, assignee for the benefit of creditors,
receiver, custodian or execution, judgment or attachment creditor of the Borrower or such
Subsidiary Borrower, or against anyone else claiming through or against the Borrower or such
Subsidiary Borrower or such trustee in bankruptcy, debtor in possession, assignee for the benefit
of creditors, receiver, custodian or execution, judgment or attachment creditor, notwithstanding
the fact that such right of set-off shall not have been exercised by such Lender prior to the
making, filing or issuance of, or service upon such Lender of, or of notice of, any such petition,
assignment for the benefit of creditors, appointment or application for the appointment of a
receiver, or issuance of execution, subpoena, order or warrant. Each Lender agrees promptly to
notify the Borrower or such Subsidiary Borrower after any such set-off and application made by such
Lender, provided that the failure to give such notice shall not affect the validity of such
set-off and application. Any set-off pursuant to this paragraph may be effected notwithstanding
that the currencies of the offsetting indebtedness may be different, and any such set-off shall be
done by reference to the spot exchange rate for such currencies on the date of such set-off. Each
Lender agrees that it will promptly pay to the Administrative Agent the amount of any set-off by
it against the obligations hereunder as contemplated above for distribution by the Administrative
Agent in accordance with the provisions of this Agreement.

          (c)   In calculating the amount of Commitments, Loans or Obligations for any purpose under
this Agreement and the other Loan Documents, including, without limitation, voting or distribution
purposes, the amount of any thereof which is denominated in a currency other than Dollars
shall be converted into Dollars at the Dollar Equivalent thereof on the date on which such
calculation is to be made.

          10.8  Enforceability; Usury. In no event shall any provision of
this Agreement or any other instrument evidencing or securing the indebtedness of the Borrower or
any Subsidiary Borrower hereunder ever obligate the Borrower or any of the Subsidiary Borrowers to
pay or allow any Lender to collect interest on the Loans or any other indebtedness of the Borrower
or any of the Subsidiary Borrowers hereunder at a rate greater than the maximum non-usurious rate
permitted by applicable law (herein referred to as the “Highest Lawful Rate”), or obligate
the Borrower or any of the Subsidiary Borrowers to pay any taxes, assessments, charges, insurance
premiums or other amounts to the extent that such payments, when added to the interest payable on
the Loans or any other indebtedness hereunder, would be held to constitute the payment by the
Borrower or such Subsidiary Borrower of interest at a rate greater than the Highest Lawful Rate;
and this provision shall control over any provision to the contrary.

          Without limiting the generality of the foregoing, in the event the maturity of all or any part
of the principal amount of the indebtedness of the Borrower or any of the Subsidiary Borrowers
hereunder shall be accelerated for any reason, then such principal amount so accelerated shall be
credited with any interest theretofore paid thereon in advance and remaining unearned at the time
of such acceleration. If, pursuant to the terms of this Agreement, any funds are applied to the
payment of any part of the principal amount of the indebtedness of the Borrower or any of the
Subsidiary Borrowers hereunder prior to the maturity thereof, then (a) any interest which would
otherwise thereafter accrue on the principal amount so paid by such application shall be canceled,
and (b) the indebtedness of the Borrower

 

90

or such Subsidiary Borrower hereunder remaining unpaid
after such application shall be credited with the amount of all interest, if any, theretofore
collected on the principal amount so paid by such application and remaining unearned at the date of
said application; and if the funds so applied shall be sufficient to pay in full all the
indebtedness of the Borrower or such Subsidiary Borrower hereunder, then the Lenders shall refund
to the Borrower or such Subsidiary Borrower all interest theretofore paid thereon in advance and
remaining unearned at the time of such acceleration. Regardless of any other provision in this
Agreement, or in any of the written evidences of the indebtedness of the Borrower or any of the
Subsidiary Borrowers hereunder, neither the Borrower nor any of the Subsidiary Borrowers shall be
required to pay any unearned interest on such indebtedness or any portion thereof, or be required
to pay interest thereon at a rate in excess of the Highest Lawful Rate construed by courts having
competent jurisdiction thereof.

          10.9  Judgment. The obligations of the Borrower or any Subsidiary
Borrower in respect of this Agreement and any Note due to any party hereto or any holder of any
bond shall, notwithstanding any judgment in a currency (the “judgment currency”) other than
the currency in which the sum originally due to such party or such holder is denominated (the
“original currency”), be discharged only to the extent that on the Business Day following receipt
by such party or such holder (as the case may be) of any sum adjudged to be so due in the judgment
currency such party or such holder (as the case may be) may in accordance with normal banking
procedures purchase the original currency with the judgment currency; if the amount of the original
currency so purchased is less than the sum originally due to such party or such holder (as the case
may be) in the original currency, the Borrower or such Subsidiary Borrower, as the case may be,
agrees, as a separate obligation and notwithstanding any such judgment, to indemnify such party or
such holder (as the case may be) against such loss, and if the amount of the original currency so
purchased exceeds the sum originally due to any party to this Agreement or any holder of Notes (as
the
case may be), such party or such holder (as the case may be), agrees to remit to the Borrower
or such Subsidiary Borrower, as the case may be, such excess. This covenant shall survive the
termination of this Agreement and payment of the Loans and all other amounts payable hereunder.

          10.10  Counterparts. This Agreement may be executed by one or more
of the parties hereto on any number of separate counterparts and all of said counterparts taken
together shall be deemed to constitute one and the same instrument. A set of the copies of this
Agreement signed by all the parties hereto shall be delivered to the Borrower and the
Administrative Agent. Delivery of an executed counterpart of a signature page of this Agreement by
telecopy shall be effective as delivery of a manually executed counterpart of this Agreement.

          10.11  Governing Law; No Third Party Rights. This Agreement and
the rights and obligations of the parties under this Agreement shall be governed by, and construed
and interpreted in accordance with, the law of the State of New York. This Agreement is solely for
the benefit of the parties hereto and their respective successors and assigns, and no other Person
shall have any right, benefit, priority or interest under, or because of the existence of, this
Agreement. If any amendment to this Agreement provides for (a) the payment in full of all the
Loans of a Lender outstanding under this Agreement, together with any accrued interest thereon and
any accrued fees payable to such Lender under this Agreement, and (b) the termination of all
Commitments of such Lender under this Agreement, then (i) such amendment shall not require the
consent of such Lender (but shall in any event require the consent of each continuing Lender with
Loans or a Commitment under the same Facility), and (ii) concurrently with the effectiveness of
such amendment, such Lender shall cease to be a party to this Agreement and shall cease to have any
rights under this Agreement (other than rights hereunder expressly stated to survive the
termination of this Agreement and any rights hereunder and under the other Loan Documents with
respect to any Hedging Agreement entered into by such Lender or any of its affiliates prior to the
date such amendment becomes effective).

 

91

          10.12  Headings. The headings of the Sections and subsections of
this Agreement are inserted for convenience only and shall not be deemed to constitute a part
hereof.

          10.13  Submission To Jurisdiction; Waivers. Each of the Borrower
and the Subsidiary Borrowers hereby irrevocably and unconditionally:

     (a)   submits for itself and its property in any legal action or proceeding relating to
this Agreement and the other Loan Documents to which it is a party, or for recognition and
enforcement of any judgment in respect thereof, to the non-exclusive general jurisdiction of
the Courts of the State of New York, the courts of the United States of America for the
Southern District of New York, and appellate courts from any thereof;

     (b)   consents that any such action or proceeding may be brought in such courts and
waives any objection that it may now or hereafter have to the venue of any such action or
proceeding in any such court or that such action or proceeding was brought in an
inconvenient court and agrees not to plead or claim the same;

     (c)   agrees that service of process in any such action or proceeding may be effected
by mailing a copy thereof by registered or certified mail (or any substantially similar form
of mail), postage prepaid, to the Borrower and the Subsidiary Borrowers at their respective
addresses set forth in subsection 10.2 or at such other address of which the Administrative
Agent shall have been notified pursuant thereto;

     (d)   agrees that nothing herein shall affect the right to effect service of process in
any other manner permitted by law or shall limit the right to sue in any other jurisdiction;
and

     (e)   waives, to the maximum extent not prohibited by law, any right it may have to
claim or recover in any legal action or proceeding referred to in this subsection any
special, exemplary, punitive or consequential damages.

     (f)   Upon any Foreign Subsidiary becoming a Foreign Subsidiary Borrower, such Foreign
Subsidiary Borrower hereby agrees to irrevocably and unconditionally appoint the Borrower or
an agent for service of process located in New York City (the “New York Process
Administrative Agent”), reasonably satisfactory to the Administrative Agent, as its
agent to receive on behalf of such Foreign Subsidiary Borrower and its property service of
copies of the summons and complaint and any other process which may be served in any action
or proceeding in any such New York State or Federal court described in paragraph (a) of this
subsection and agrees promptly to appoint a successor New York Process Administrative Agent
in The City of New York (which successor New York Process Administrative Agent shall accept
such appointment in a writing reasonably satisfactory to the Administrative Agent) prior to
the termination for any reason of the appointment of the initial New York Process
Administrative Agent. In any such action or proceeding in such New York State or Federal
court, such service may be made on such Foreign Subsidiary Borrower by delivering a copy of
such process to such Foreign Subsidiary Borrower in care of the New York Process
Administrative Agent at the New York Process Administrative Agent’s address and by
depositing a copy of such process in the mails by certified or registered air mail,
addressed to such Foreign Subsidiary Borrower at its address specified in subsection 10.2
(such service to be effective upon such receipt by the New York Process Administrative Agent
and the depositing of such process in the mails as aforesaid). Each of the Foreign
Subsidiary Borrowers hereby irrevocably and unconditionally authorizes and directs the New
York Process Administrative Agent to accept such service on its behalf. As an alternate
method of service, each of the Foreign Subsidiary Borrowers irrevocably and unconditionally

 

92

consents to the service of any and all process in any such action or proceeding in such New
York State or Federal court by mailing of copies of such process to such Foreign Subsidiary
Borrower by certified or registered air mail at its address specified in subsection 10.2.
Each of the Foreign Subsidiary Borrowers agrees that, to the fullest extent permitted by
applicable law, 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.

     (g)   To the extent that any Foreign Subsidiary Borrower has or hereafter may acquire
any immunity (sovereign or otherwise) from any legal action, suit or proceeding, from
jurisdiction of any court or from set-off or any legal process (whether service or notice,
attachment prior to judgment, attachment in aid of execution of judgment, execution of
judgment or otherwise) with respect to itself or any of its property, such Foreign
Subsidiary Borrower hereby irrevocably waives and agrees not to plead or claim such immunity
in respect of its obligations under this Agreement and any Note.

          10.14 Acknowledgments. Each of the Borrower and the Subsidiary Borrowers hereby acknowledges that:

     (a)   it has been advised by counsel in the negotiation, execution and delivery of this
Agreement and the other Loan Documents;

     (b)   neither the Administrative Agent nor any Lender has any fiduciary relationship to
the Borrower or any Subsidiary Borrower, and the relationship between Administrative Agent
and Lenders, on one hand, and the Borrower or any Subsidiary Borrower, on the other hand, is
solely that of debtor and creditor; and

     (c)   no joint venture exists among the Lenders or among the Borrower or any Subsidiary
Borrower and the Lenders.

          10.15  Confidentiality. Each of the Administrative Agent and each
Lender agrees to keep confidential all non-public information provided to it by any Loan Party, the
Administrative Agent or any Lender pursuant to or in connection with this Agreement that is
designated by the provider thereof as confidential; provided that nothing herein shall
prevent the Administrative Agent or any Lender from disclosing any such information (a) to the
Administrative Agent, any other Lender or any affiliate thereof, (b) subject to an agreement to
comply with the provisions of this subsection 10.15, to any actual or prospective transferee or any
direct or indirect counterparty to any Hedging Agreement (or any professional advisor to such
counterparty), (c) to its employees, directors, agents, attorneys, accountants and other
professional advisors or those of any of its affiliates (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), (d) upon the request or demand of any
Governmental Authority, (e) in response to any order of any court or other Governmental Authority
or as may otherwise be required pursuant to any Requirement of Law, (f) if requested or required to
do so in connection with any litigation or similar proceeding, (g) that has been publicly
disclosed, (h) to the National Association of Insurance Commissioners or any similar organization
or any nationally recognized rating agency that requires access to information about a Lender’s
investment portfolio in connection with ratings issued with respect to such Lender, or (i) in
connection with the exercise of any remedy hereunder or under any other Loan Document.

          Each Lender acknowledges that information furnished to it pursuant to this Agreement or the
other Loan Documents may include material non-public information concerning the Borrower and its
Affiliates and their related parties or their respective securities, and confirms that it has
developed

 

93

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 requests for waivers and amendments, furnished by the Borrower or
the Administrative Agent pursuant to, or in the course of administering, this Agreement or the
other Loan Documents will be syndicate-level information, which may contain material non-public
information about the Borrower and its Affiliates 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, including Federal and state securities laws.

          10.16   WAIVERS OF JURY TRIAL. THE BORROWER, THE SUBSIDIARY BORROWERS, THE ADMINISTRATIVE AGENT AND THE LENDERS HEREBY
IRREVOCABLY AND UNCONDITIONALLY WAIVE TRIAL BY JURY IN ANY LEGAL ACTION OR PROCEEDING RELATING TO
THIS AGREEMENT OR ANY LOAN DOCUMENT AND FOR ANY COUNTERCLAIM THEREIN.

          10.17  Severability. Any provision of this Agreement which is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to
the extent of such prohibition or unenforceability without invalidating the remaining provisions
hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction.

          10.18 USA PATRIOT Act. Each 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 to identify the Borrower in accordance with the Act. The
Borrower shall promptly provide such information upon request by any Lender.

 

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

	 	 	 	 	 
	 	 	THE SCOTTS MIRACLE-GRO COMPANY

	 

	 	By:
	 	/s/ David C. Evans
	 

	 	 	 	 
	 

	 	 	 	Name: David C. Evans
	 

	 	 	 	Title: Executive Vice President and Chief Financial Officer

	 	 	HYPONEX CORPORATION

	 

	 	By:
	 	/s/ David C. Evans
	 

	 	 	 	 
	 

	 	 	 	Name: David C. Evans
	 

	 	 	 	Title: Executive Vice President and Chief Financial Officer

	 	 	SCOTTS AUSTRALIA PTY. LTD.

	 

	 	By:
	 	/s/ Edward R. Claggett
	 

	 	 	 	 
	 

	 	 	 	Name: Edward R. Claggett
	 

	 	 	 	Title: Director

	 	 	SCOTTS CANADA LTD.

	 

	 	By:
	 	/s/ Edward R. Claggett
	 

	 	 	 	 
	 

	 	 	 	Name: Edward R. Claggett
	 

	 	 	 	Title: Vice President and Assistant Secretary

	 	 	SCOTTS HOLDINGS LIMITED

	 

	 	By:
	 	/s/ Edward R. Claggett
	 

	 	 	 	 
	 

	 	 	 	Name: Edward R. Claggett
	 

	 	 	 	Title: Director

 

 

	 	 	 	 	 
	 	 	SCOTTS MANUFACTURING COMPANY

	 

	 	By:
	 	/s/ David C. Evans
	 

	 	 	 	 
	 

	 	 	 	Name: David C. Evans

	 

	 	 	 	Title: Executive Vice President and Chief Financial Officer

	 	 	EG SYSTEMS, INC.

	 

	 	By:
	 	/s/ David C. Evans
	 

	 	 	 	 
	 

	 	 	 	Name: David C. Evans
	 

	 	 	 	Title: Executive Vice President and Chief Financial Officer

	 	 	SCOTTS TEMECULA OPERATIONS, LLC

	 

	 	By:
	 	/s/ Edward R. Claggett
	 

	 	 	 	 
	 

	 	 	 	Name: Edward R. Claggett
	 

	 	 	 	Title: Vice President and Assistant Secretary

	 	 	THE SCOTTS COMPANY (UK) LTD.

	 

	 	By:
	 	/s/ Edward R. Claggett
	 

	 	 	 	 
	 

	 	 	 	Name: Edward R. Claggett
	 

	 	 	 	Title: Director

	 	 	SCOTTS TREASURY EEIG

	 

	 	By:
	 	/s/ Edward R. Claggett
	 

	 	 	 	 
	 

	 	 	 	Name: Edward R. Claggett
	 

	 	 	 	Title: Authorized Signatory

 

 

	 	 	 	 	 
	 	 	THE SCOTTS COMPANY LLC

	 

	 	By:
	 	/s/ David C. Evans
	 

	 	 	 	 
	 

	 	 	 	Name: David C. Evans
	 

	 	 	 	Title: Executive Vice President and Chief Financial Officer

	 	 	SMITH & HAWKEN, LTD.

	 

	 	By:
	 	/s/ David C. Evans
	 

	 	 	 	 
	 

	 	 	 	Name: David C. Evans
	 

	 	 	 	Title: Senior Vice President

	 	 	SMG GROWING MEDIA, INC.

	 

	 	By:
	 	/s/ David C. Evans
	 

	 	 	 	 
	 

	 	 	 	Name: David C. Evans
	 

	 	 	 	Title: Executive Vice President and Chief Financial Officer

	 	 	GUTWEIN & CO., INC.

	 

	 	By:
	 	/s/ David C. Evans
	 

	 	 	 	 
	 

	 	 	 	Name: David C. Evans
	 

	 	 	 	Title: Executive Vice President and Chief Financial Officer

 

 

	 	 	 	 	 
	 	 	JPMORGAN CHASE BANK, N.A.,
	 	 	as Administrative Agent and as a Lender

	 

	 	By:
	 	/s/ Randolph Cates
	 

	 	 	 	 
	 

	 	 	 	Name: Randolph Cates
	 

	 	 	 	Title: Vice President

 

 

Signature page to

The Scotts Miracle-Gro Company

2007 Amended and Restated Credit Agreement

	 	 	 	 	 
	 	 	BANK OF AMERICA, N.A.,
	 	 	As Syndication Agent and Lender

	 

	 	By:
	 	/s/ Sharon Burks Horos
	 

	 	 	 	 
	 

	 	 	 	Name: Sharon Burks Horos
	 

	 	 	 	Title: Vice President

 

 

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The Scotts Miracle-Gro Company

2007 Amended and Restated Credit Agreement

	 	 	 	 	 
	 	 	BANK OF MONTREAL

	 

	 	By:
	 	/s/ Ben Ciallella
	 

	 	 	 	 
	 

	 	 	 	Name: Ben Ciallella
	 

	 	 	 	Title: Vice President

 

 

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The Scotts Miracle-Gro Company

2007 Amended and Restated Credit Agreement

	 	 	 	 	 
	 	 	BMO CAPITAL MARKETS FINANCING, INC.,

	 

	 	By:
	 	/s/ Robert H. Wolohan
	 

	 	 	 	 
	 

	 	 	 	Name: Robert H. Wolohan
	 

	 	 	 	Title: Vice President

 

 

Signature page to

The Scotts Miracle-Gro Company

2007 Amended and Restated Credit Agreement

	 	 	 	 	 
	 	 	The Bank of Tokyo-Mitsubishi UFJ, Ltd.,
	 	 	New York Branch

	 

	 	By:
	 	/s/ Maria Ferradas
	 

	 	 	 	 
	 

	 	 	 	Name: Maria Ferradas
	 

	 	 	 	Title: Authorized Signatory

 

 

Signature page to

The Scotts Miracle-Gro Company

2007 Amended and Restated Credit Agreement

	 	 	 	 	 
	 	 	BAYERISCHE LANDESBANK
	 	 	New York Branch

	 

	 	By:
	 	/s/ Edward J. Cripps
	 

	 	 	 	 
	 

	 	 	 	Edward J. Cripps
	 

	 	 	 	Vice President

	 

	 	By:
	 	/s/ Georgina Fiordalisi
	 

	 	 	 	 
	 

	 	 	 	Georgina Fiordalisi
	 

	 	 	 	Vice President

 

 

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The Scotts Miracle-Gro Company

2007 Amended and Restated Credit Agreement

	 	 	 	 	 
	 	 	BNP Paribas

	 

	 	By:
	 	/s/ Curtis Price
	 

	 	 	 	 
	 

	 	 	 	Name: Curtis Price
	 

	 	 	 	Title: Managing Director

	 

	 	By:
	 	/s/ Richard Broeren
	 

	 	 	 	 
	 

	 	 	 	Name: Richard Broeren
	 

	 	 	 	Title: Managing Director

 

 

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The Scotts Miracle-Gro Company

2007 Amended and Restated Credit Agreement

	 	 	 	 	 
	 	 	[INSERT LENDER Name] CALYON

	 

	 	By:
	 	/s/ Lee E. Greve
	 

	 	 	 	 
	 

	 	 	 	Name: Lee E. Greve
	 

	 	 	 	Title: Managing Director

	 

	 	By:
	 	/s/ Blake Wright
	 

	 	 	 	 
	 

	 	 	 	Name: Blake Wright
	 

	 	 	 	Title: Managing Director

 

 

Signature page to

The Scotts Miracle-Gro Company

2007 Amended and Restated Credit Agreement

	 	 	 	 	 
	 	 	Chang Hwa Commercial Bank, Ltd., New York Branch

	 

	 	By:
	 	/s/ Jim C.Y. Chen
	 

	 	 	 	 
	 

	 	 	 	Name: Jim C.Y. Chen
	 

	 	 	 	Title: VP & General Manager

 

 

Signature page to

The Scotts Miracle-Gro Company

2007 Amended and Restated Credit Agreement

	 	 	 	 	 
	 	 	Citicorp North America, Inc.

	 

	 	 
	 	/s/ Robert H. Chen
	 

	 	 	 	 
	 

	 	 	 	Name: Robert H. Chen

Title: Vice President

 

 

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The Scotts Miracle-Gro Company

2007 Amended and Restated Credit Agreement

	 	 	 	 	 
	 	 	CITIZENS BANK OF PENNSYLVANIA

	 

	 	By:
	 	/s/ Clifford A. Mull
	 

	 	 	 	 
	 

	 	 	 	Name: Clifford A. Mull

Title: Vice President

 

 

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The Scotts Miracle-Gro Company

2007 Amended and Restated Credit Agreement

	 	 	 	 	 
	 	 	CoBank, ACB

	 

	 	By:
	 	/s/ S. Richard Dill
	 

	 	 	 	 
	 

	 	 	 	Name: S. Richard Dill

Title: Vice President

 

 

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The Scotts Miracle-Gro Company

2007 Amended and Restated Credit Agreement

	 	 	 	 	 
	 	 	Comerica Bank

	 

	 	By:
	 	/s/ Scott M. Kowalski
	 

	 	 	 	 
	 

	 	 	 	Name: Scott M. Kowalski

Title: Vice President

 

 

Signature page to

The Scotts Miracle-Gro Company

2007 Amended and Restated Credit Agreement

	 	 	 	 	 
	 	 	Commerzbank AG, New York and

Grand Cayman Branches

	 

	 	By:
	 	/s/ Albert Morron
	 

	 	 	 	 
	 

	 	 	 	Name: Albert Morron

Title: Assistant Vice President
	 
	 	 	 	 
	 

	 	By:
	 	/s/ John Marlatt
	 

	 	 	 	 
	 

	 	 	 	Name: John Marlatt

Title: Senior Vice President

 

 

Signature page to

The Scotts Miracle-Gro Company

2007 Amended and Restated Credit Agreement

	 	 	 	 	 
	 	 	E.Sun Commercial Bank, Ltd., Los Angeles Branch

	 

	 	By:
	 	/s/ Benjamin Lin
	 

	 	 	 	 
	 

	 	 	 	Name: Benjamin Lin

Title: EVP & General Manager

 

 

Signature page to

The Scotts Miracle-Gro Company

2007 Amended and Restated Credit Agreement

	 	 	 	 	 
	 	Fifth Third Bank

 	 
	 	By:  	/s/ Brent M. Jackson
 	 
	 	 	Name:  	Brent M. Jackson 	 
	 	 	Title:  	Vice President 	 

 

 

	 	 	 	 	 

Signature page to

The Scotts Miracle-Gro Company

2007 Amended and Restated Credit Agreement

	 	 	 	 	 
	 	FORTIS CAPITAL CORP.

 	 
	 	By:  	/s/ John W. Deegan
 	 
	 	 	Name:  	John W. Deegan 	 
	 	 	Title:  	Senior Vice President 	 
	 
	 	 	 
	 	By:  	                                      /s/ Diran Cholakian
 	 
	 	 	Name:  	Diran Cholakian 	 
	 	 	Title:  	Senior Vice President 	 

 

 

	 	 	 	 	 

Signature page to

The Scotts Miracle-Gro Company

2007 Amended and Restated Credit Agreement

	 	 	 	 	 
	 	General Electric Capital Corporation

 	 
	 	By:  	/s/ Dwayne Coker
 	 
	 	 	Name:  	Dwayne Coker 	 
	 	 	Title:  	Duly Authorized Signatory 	 

 

 

	 	 	 	 	 

Signature page to

The Scotts Miracle-Gro Company

2007 Amended and Restated Credit Agreement

	 	 	 	 	 
	 	GreenStone Farm Credit Services, ACA/FLCA

 	 
	 	By:  	/s/ Alfred S. Compton, Jr.
 	 
	 	 	Name:  	Alfred S. Compton, Jr. 	 
	 	 	Title:  	Vice President/Sr. Lending Officer 	 

 

 

	 	 	 	 	 

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The Scotts Miracle-Gro Company

2007 Amended and Restated Credit Agreement

	 	 	 	 	 
	 	HUA NAN COMMERCIAL BANK, LTD.,

LOS ANGELES BRANCH

 	 
	 	By:  	/s/ Oliver C.H. Hsu
 	 
	 	 	Name:  	Oliver C.H. Hsu 	 
	 	 	Title:  	VP & General Manager 	 

 

 

	 	 	 	 	 

Signature page to

The Scotts Miracle-Gro Company

2007 Amended and Restated Credit Agreement

	 	 	 	 	 
	 	KBC BANK, NV, New York Branch

 	 
	 	By:  	/s/ William Cavanaugh
 	 
	 	 	Name:  	William Cavanaugh 	 
	 	 	Title:  	Vice President 	 
	 
	 	 	 
	 	By:  	                                      /s/ Robert Snauffer
 	 
	 	 	Name:  	Robert Snauffer 	 
	 	 	Title:  	First Vice President 	 

 

 

	 	 	 	 	 

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The Scotts Miracle-Gro Company

2007 Amended and Restated Credit Agreement

	 	 	 	 	 
	 	LaSalle Bank N.A.

 	 
	 	By:  	/s/ Ted Lape
 	 
	 	 	Name:  	Ted Lape 	 
	 	 	Title:  	Senior Vice President 	 

 

 

	 	 	 	 	 

Signature page to

The Scotts Miracle-Gro Company

2007 Amended and Restated Credit Agreement

	 	 	 	 	 
	 	Mizuho Corporate Bank, Ltd.

 	 
	 	By:  	/s/ Leon Mo
 	 
	 	 	Name:  	Leon Mo 	 
	 	 	Title:  	Senior Vice President 	 

 

 

	 	 	 	 	 

Signature page to

The Scotts Miracle-Gro Company

2007 Amended and Restated Credit Agreement

	 	 	 	 	 
	 	National City Bank

 	 
	 	By:  	/s/ Thomas E. Redmond
 	 
	 	 	Name:  	Thomas E. Redmond 	 
	 	 	Title:  	Senior Vice President 	 

 

 

	 	 	 	 	 

Signature page to

The Scotts Miracle-Gro Company

2007 Amended and Restated Credit Agreement

	 	 	 	 	 
	 	THE NORTHERN TRUST COMPANY

 	 
	 	By:  	/s/ Jeffrey P. Sullivan
 	 
	 	 	Name:  	Jeffrey P. Sullivan 	 
	 	 	Title:  	Vice President 	 

 

 

	 	 	 	 	 

Signature page to

The Scotts Miracle-Gro Company

2007 Amended and Restated Credit Agreement

	 	 	 	 	 
	 	PEOPLE’S BANK

 	 
	 	By:  	/s/ George F. Paik
 	 
	 	 	George F. Paik 	 
	 	 	Vice President 	 

 

 

	 	 	 	 	 

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The Scotts Miracle-Gro Company

2007 Amended and Restated Credit Agreement

	 	 	 	 	 
	 	COOPERATIEVE CENTRALE RAIFFEISEN-

BOERENLEENBANK B.A., “RABOBANK

NEDERLAND”, NEW YORK BRANCH,

as a Lender

 	 
	 	By:  	/s/ Peter Glawe
 	 
	 	 	Name:  	Peter Glawe 	 
	 	 	Title:  	Vice President 	 
	 
	 	 	 
	 	By:  	                                      /s/ Andrew Sherman
 	 
	 	 	Name:  	Andrew Sherman 	 
	 	 	Title:  	Executive Director 	 

 

 

	 	 	 	 	 

Signature page to

The Scotts Miracle-Gro Company

2007 Amended and Restated Credit Agreement

	 	 	 	 	 
	 	[State Bank of India]

 	 
	 	By:  	/s/ Ashok Wanchoo
 	 
	 	 	Name:  	Ashok Wanchoo 	 
	 	 	Title:  	Vice President & Head (Credit) 	 

 

 

	 	 	 	 	 

Signature page to

The Scotts Miracle-Gro Company

2007 Amended and Restated Credit Agreement

	 	 	 	 	 
	 	SUMITOMO MITSUI BANKING CORPORATION

 	 
	 	By:  	/s/ Shigeru Tsuru
 	 
	 	 	Name:  	Shigeru Tsuru 	 
	 	 	Title:  	Joint General Manager 	 

 

 

	 	 	 	 	 

Signature page to

The Scotts Miracle-Gro Company

2007 Amended and Restated Credit Agreement

	 	 	 	 	 
	 	TD BANKNORTH, N.A.

 	 
	 	By:  	/s/ Charles A. Walker
 	 
	 	 	Name:  	Charles A. Walker 	 
	 	 	Title:  	Senior Vice President 	 

 

 

	 	 	 	 	 

     IN WITNESS WHEREOF, the undersigned has caused this Supplement to be executed
and delivered by a duly authorized officer on the date first above written.

	 	 	 	 	 
	 	The Bank of New York

 	 
	 	By:  	/s/ J. David Parker, Jr.
 	 
	 	 	Name:  	J. David Parker, Jr. 	 
	 	 	Title:  	Vice President 	 

 

 

	 	 	 	 	 

Signature page to

The Scotts Miracle-Gro Company

2007 Amended and Restated Credit Agreement

	 	 	 	 	 
	 	Scotiabanc Inc.

 	 
	 	By:  	/s/ William E. Zarrett
 	 
	 	 	Name:  	William E. Zarrett 	 
	 	 	Title:  	Managing Director 	 

 

 

	 	 	 	 	 

Signature page to

The Scotts Miracle-Gro Company

2007 Amended and Restated Credit Agreement

	 	 	 	 	 
	 	THE GOVERNOR AND COMPANY OF THE BANK

OF IRELAND

 	 
	 	By:  	/s/ Daniel McAneney
 	 
	 	 	Name:  	Daniel McAneney 	 
	 	 	Title:  	Authorised Signatory 	 
	 
	 	 	 
	 	By:  	                                      /s/ Barry Heraty
 	 
	 	 	Name:  	Barry Heraty 	 
	 	 	Title:  	Associate Director 	 

 

 

	 	 	 	 	 

Signature page to

The Scotts Miracle-Gro Company

2007 Amended and Restated Credit Agreement

	 	 	 	 	 
	 	The Norinchukin Bank

 	 
	 	By:  	/s/ Kaoru Yamada
 	 
	 	 	Name:  	Kaoru Yamada 	 
	 	 	Title:  	Joint General Manager 	 

 

 

	 	 	 	 	 

Signature page to

The Scotts Miracle-Gro Company

2007 Amended and Restated Credit Agreement

	 	 	 	 	 
	 	U.S. Bank National Association

 	 
	 	By:  	/s/ Jason C. Nadler
 	 
	 	 	Name:  	Jason C. Nadler 	 
	 	 	Title:  	Vice President 	 

 

 

	 	 	 	 	 

Signature page to

The Scotts Miracle-Gro Company

2007 Amended and Restated Credit Agreement

	 	 	 	 	 
	 	United Overseas Bank Limited, New York Agency

 	 
	 	By:  	/s/ George Lim
 	 
	 	 	Name:  	George Lim 	 
	 	 	Title:  	FVP & General Manager 	 
	 
	 	 	 
	 	By:  	                                      /s/ Mario Sheng
 	 
	 	 	Name:  	Mario Sheng 	 
	 	 	Title:  	AVP 	 
	 

 

 

 

ANNEX A

PRICING GRID

	 	 	 	 	 	 	 	 	 	 	 	 	 
	Leverage	 	Applicable	 	Commitment
	Ratio	 	Margin	 	Fee Rate
	 	 	LIBOR	 	ABR	 	 	 	 
	> 4.00 to 1.00
	 	 	1.500	%	 	 	0.500	%	 	 	0.350	%
	> 3.00 to 1.00
	 	 	1.250	%	 	 	0.250	%	 	 	0.250	%
	> 2.25 to 1.00
	 	 	1.000	%	 	 	0.000	%	 	 	0.250	%
	> 1.75 to 1.00
	 	 	0.875	%	 	 	0.000	%	 	 	0.200	%
	> 1.25 to 1.00
	 	 	0.750	%	 	 	0.000	%	 	 	0.200	%
	< 1.25 to 1.00
	 	 	0.625	%	 	 	0.000	%	 	 	0.175	%

Changes in the Applicable Margin or in the Commitment Fee Rate resulting from changes in the
Leverage Ratio shall become effective on the date (the “Adjustment Date”) on which
financial statements are delivered to the Lenders pursuant to subsection 6.1 (but in any event not
later than the 45th day after the end of each of the first three quarterly periods of
each fiscal year of the Borrower or the 90th day after the end of each fiscal year of
the Borrower, as the case may be) and shall remain in effect until the next change to be effected
pursuant to this paragraph. If any financial statements referred to above are not delivered within
the time periods specified above, then, until such financial statements are delivered, the Leverage
Ratio as at the end of the fiscal period that would have been covered thereby shall for the
purposes of this definition be deemed to be greater than or equal to 4.00 to 1.00. In addition, at
all times while an Event of Default shall have occurred and be continuing, the Leverage Ratio shall
for the purposes of this definition be deemed to be greater than 4.00 to 1.00. Each determination
of the Leverage Ratio pursuant to this pricing grid shall be made with respect to (or, in the case
of Average Total Indebtedness, as at the end of) the period of four consecutive fiscal quarters of
the Borrower ending at the end of the period covered by the relevant financial statements.

 

 

ANNEX B

SECTION 1.   DEFINITIONS

          Defined Terms. Unless otherwise defined herein, terms defined in the Amended and
Restated Credit Agreement, dated as of February 7, 2007 (as amended, restated supplemented or
otherwise modified from time to time, the “Credit Agreement”) to which this Annex B is
attached and used herein shall have the meanings given to them in the Credit Agreement, and the
following terms shall have the following meanings:

     “Aggregate Sterling Revolving Extensions of Credit” shall mean an amount equal
to the sum of (a) the aggregate principal amount of all Sterling Loans (including, without
limitation, Sterling Swing Line Loans borrowed under Sterling Commitments) then outstanding
and (b) the aggregate amount of all Sterling L/C Obligations then outstanding.

     “Aggregate Facility B Revolving Extensions of Credit” shall mean an amount
equal to the sum of (a) the aggregate principal amount of all Facility B Loans (including,
without limitation, Sterling Swing Line Loans borrowed under Facility B Commitments) then
outstanding and (b) the aggregate amount of all Sterling L/C Obligations then outstanding in
respect of Letters of Credit issued under the Facility B Commitments.

     “Applicable Margin for Sterling Borrowing” shall mean for each type of Sterling
Loan, the rate per annum set forth under the relevant column heading in the pricing grid
attached as Appendix I hereto.

     “Application” shall mean an application, in such form as the Sterling Issuing
Lender may specify from time to time, requesting such Sterling Issuing Lender to open a
Sterling Letter of Credit.

     “Available Sterling Commitment” shall mean, as to any Lender at any time, the
amount equal to the excess, if any, of (a) such Lender’s Sterling Commitment over
(b) the sum of such Lender’s (i) ratable portion of the Aggregate Facility B Revolving
Extensions of Credit and (ii) ratable portion of the Aggregate Sterling Revolving Extensions
of Credit. The Available Sterling Commitment may be calculated as being negative at any
time.

     “Borrowing Date (U.K.)” shall mean any Business Day (U.K.) specified in a
notice as a date on which the Sterling Subsidiary Borrower requests the relevant Sterling
Lenders to make Sterling Loans under this Annex B to the Credit Agreement.

     “Business Day (U.K.)” shall mean a day on which banks are open for business in
London but excludes Saturday, Sunday and any other day which is a legal holiday in London.

     “Eligible U.K. Bank” shall mean a Person that is both (i) a bank as defined in
Section 840A of the United Kingdom Income and Corporation Taxes Act 1988, and (ii) a Person
within the charge to United Kingdom corporation tax (i.e., a United Kingdom resident company
or a non-resident company which is carrying on a trade in the United Kingdom through a
permanent establishment in the United Kingdom to which the beneficial interest in interest
accrued under Loans made to the Borrower or a Subsidiary Borrower is attributable and which
is not entitled to exemption from tax in respect of that interest).

 

2

     “Interest Payment Date” shall mean (a) as to any Reference Rate Loan, the last
day of each March, June, September and December, commencing on the first of such days to
occur after such Reference Rate Loan is made or any LIBOR Loan is converted to such
Reference Rate Loan, (b) as to any LIBOR Loan in respect of which the relevant Sterling
Subsidiary Borrower has selected an Interest Period of one month, two months or three
months, the last day of such Interest Period and (c) as to any LIBOR Loan in respect of
which the relevant Sterling Subsidiary Borrower has selected a longer Interest Period than
the periods described in preceding clause (b), the day three months after the commencement
of such Interest Period and the last day of such Interest Period.

     “Interest Period” shall mean with respect to any LIBOR Loan, (i) initially, the
period commencing on, as the case may be, the borrowing or conversion date with respect to a
LIBOR Loan, and ending one, two, three or six months thereafter, as selected by the relevant
Sterling Subsidiary Borrower in its irrevocable written notice of borrowing as provided in
subsection 2.2 or its written irrevocable notice of conversion as provided in subsection
2.11 and (ii) thereafter, each period commencing on the last day of the next preceding
Interest Period applicable to such LIBOR Loan and ending one, two, three or six months
thereafter, as selected by the relevant Sterling Subsidiary Borrower by irrevocable written
notice to the Sterling Administrative Agent not less than three Business Days (U.K.) prior
to the last day of then current Interest Period with respect to such Sterling Loan;
provided that all of the foregoing provisions relating to Interest Periods are
subject to the following:

     1. if any Interest Period pertaining to a LIBOR Loan would otherwise end on a
day which is not a Business Day (U.K.), that Interest Period shall be extended to
the next succeeding Business Day (U.K.) unless the result of such extension would be
to carry such Interest Period into another calendar month in which event such
Interest Period shall end on the next preceding Business Day (U.K.);

     2. if the relevant Sterling Subsidiary Borrower shall fail to give notice as
provided in clauses (i) and (ii) in this definition, the relevant Sterling
Subsidiary Borrower shall be deemed to have requested conversion of the affected
LIBOR Loan to a Reference Rate Loan on the last day of then current Interest Period
with respect thereto;

     3. any Interest Period that would otherwise extend beyond the Revolving Credit
Termination Date shall end on the Revolving Credit Termination Date; and

     4. any Interest Period pertaining to a LIBOR Loan that begins on the last
Business Day (U.K.) of a calendar month (or on day a for which there is no
numerically corresponding day in the calendar month at the end of such Interest
Period) shall end on the last Business Day (U.K.) of a calendar month.

     “LIBOR Base Rate” shall mean, with respect to any LIBOR Loan for any Interest
Period therefor:

     1. the rate per annum (rounded to the nearest 1/16 of 1%) appearing on the
Screen for such currency as the London Interbank Offered Rate for deposits in such
currency at approximately 11:00 a.m. London time (or as soon thereafter as
practicable) on (in the case of any LIBOR Loan in Sterling) or two Business Days
prior to (in the case of any LIBOR Loan in euros) the first day of such Interest
Period as the London Interbank Offered Rate for such currency having a term
comparable to such Interest

 

3

Period and in an amount equal to the Sterling or euro equivalent, as the case
may be, of U.S.$1,000,000; or

     2. if such rate does not appear on the Screen (or, if the Screen shall cease to
be publicly available or if the information contained on the Screen, in the Sterling
Administrative Agent’s reasonable judgment, shall cease accurately to reflect such
LIBOR Base Rate, as reported by any publicly available source of similar market data
selected by the Sterling Administrative Agent that, in the Sterling Administrative
Agent’s reasonable judgment, accurately reflects such LIBOR Base Rate), the LIBOR
Base Rate shall mean, with respect to any LIBOR Loan for any Interest Period, the
arithmetic mean, as determined by the Sterling Administrative Agent, of the rate per
annum (rounded to the nearest 1/16 of 1%) quoted by each relevant Reference Bank at
approximately 11:00 a.m. London time (or as soon thereafter as practicable) on the
first day of the Interest Period for such Loan for the offering by such Reference
Bank to leading banks in the London interbank market of deposits in such currency
having a term comparable to such Interest Period and in an amount comparable to the
principal amount of the LIBOR Loan to be made by such Reference Bank (or its
applicable Lending Installation, as the case may be) for such Interest Period.

     “LIBOR Loans” shall mean the Sterling Loans hereunder at such time as they are
made and/or being maintained at a rate of interest based upon the applicable LIBOR Rate.

     “LIBOR Rate” shall mean with respect to a LIBOR Loan for each day during each
Interest Period pertaining thereto, the sum of the LIBOR Base Rate plus, to the
extent generally applicable to loans to the relevant Borrower or Subsidiary Borrower, the
Financial Services Authority charges for such day.

     “Post-Default Rate” shall mean a rate equal to the sum or 2% plus the
rate of interest otherwise applicable to such Sterling Loan.

     “Reference Banks”: JPMorgan Chase Bank, N.A., Citicorp North America, Inc. and
Bank of America, N.A. or such other Sterling Lenders, as determined by the Sterling
Administrative Agent, from time to time.

     “Reference Rate”: the rates of interest publicly announced by the Reference
Banks from time to time as their respective reference or prime rates, which such rates may
not be the lowest rate of interest charged by such Reference Banks.

     “Reference Rate Loans”: Sterling Loans hereunder at such time as they are made
or being maintained at a rate of interest based upon the Reference Rate.

     “Requirement of Law” shall mean, as to any Person, the Certificate of
Incorporation or Articles of Incorporation, as the case may be, and Code of Regulations
and/or By-Laws or other organizational or governing documents of such Person, and any law,
treaty, rule or regulation, or determination of an arbitrator or a court or other
Governmental Authority, in each case applicable to or binding upon such Person or any of its
property or to which such Person or any of its property is subject.

     “Screen” shall mean the Telerate Page on which appears the LIBOR Base Rate for
deposits in Sterling or euros, as applicable; provided that, if there is no such
Telerate Page, the relevant Bloomberg Financial Markets Service page will be substituted.

 

4

     “Sterling” or “£” shall mean pounds sterling in the lawful currency of
the United Kingdom.

     “Sterling Administrative Agent” shall mean J.P. Morgan Europe Limited, together
with its affiliates, as the agent for the Sterling Lenders under the Credit Agreement.

     “Sterling Administrative Office” shall mean the Sterling Administrative Agent’s
office located at 125 London Wall, London England EC2 5AJ, telecopy: +44-207-777-2360,
attention: Sue Dalton, Agency Department, or such other office in the United Kingdom as may
be designated as such by the Sterling Administrative Agent by written notice to the Sterling
Subsidiary Borrowers and the Sterling Lenders.

     “Sterling Commitment” shall mean, as to any Sterling Lender, the obligation of
such Sterling Lender to make Sterling Loans and participate in Sterling Swing Line Loans or
Sterling Letters of Credit hereunder in an aggregate principal or face amount at any one
time outstanding up to but not exceeding the amount set forth opposite such Sterling
Lender’s name on Schedule 1 to the Credit Agreement under the caption “Sterling Commitment”
or in the Assignment and Acceptance pursuant to which such Sterling Lender became party to
the Credit Agreement, as the same may be changed from time to time pursuant to the terms
hereof. The original aggregate principal amount of the Sterling Commitments is the Sterling
or euro equivalent of U.S.$300,000,000.

     “Sterling Commitment Percentage” shall mean as to any Sterling Lender at any
time, the percentage of the aggregate Sterling Commitments then constituted by such Sterling
Lender’s Sterling Commitment.

     “Sterling Facility” shall mean the Sterling Commitments together with the
Aggregate Sterling Revolving Extensions of Credit.

     “Sterling Issuing Lender” shall mean J.P. Morgan Europe Limited.

     “Sterling L/C Commitment” shall mean the amount equal to the Sterling or euro
equivalent of U.S.$65,000,000.

     “Sterling L/C Obligations” shall mean, at any time, an amount equal to the sum
of (a) the aggregate then undrawn and unexpired amount of then outstanding Sterling Letters
of Credit and (b) the aggregate amount of drawings under Sterling Letters of Credit which
have not then been reimbursed pursuant to Section 3.

     “Sterling L/C Participants” shall mean the collective reference to all the
Sterling Lenders other than the Issuing Lender.

     “Sterling Lender” shall mean each Lender that has a Sterling Commitment or that
holds Sterling Loans; collectively, the “Sterling Lenders”. Each Sterling Lender on
the date hereof represents that it is an Eligible U.K. Bank.

     “Sterling Letter of Credit” shall mean any Sterling Standby L/C or Sterling
Trade L/C, as each term is defined in subsection 3.1.

     “Sterling Loan” shall mean any Loan made under the Sterling Commitments
pursuant to subsection 2.1; collectively, the “Sterling Loans”.

 

5

     “Sterling Lending Office” shall mean for each Sterling Lender, the lending
office for such Sterling Lender (or of an affiliate of such Sterling Lender) designated for
each type of Sterling Loan in the Administrative Questionnaire of such Sterling Lender or
such other lending office of such Sterling Lender (or of an affiliate of such Sterling
Lender) as such Sterling Lender may from time to time specify to the Sterling Administrative
Agent and the Sterling Subsidiary Borrowers as the office by which its Sterling Loans of
such type are to be made and maintained.

     “Sterling Swing Line Commitment” shall mean the obligation of the Sterling
Swing Line Lender, at any date, to make a Sterling Swing Line Loan pursuant to subsection
2.3(a) in the amount referred to therein.

     “Sterling Swing Line Lender” shall mean The Royal Bank of Scotland plc or any
Affiliate thereof and such other Lenders or Affiliates thereof as may be designated in
writing by the Sterling Subsidiary Borrowers which agree in writing to act as such in
accordance with the terms hereof and are reasonably acceptable to the Sterling
Administrative Agent.

     “Sterling Swing Line Loan” shall mean any Sterling Swing Line Loan made
pursuant to subsection 2.3 hereof.

     “Telerate Page” shall mean the “British Bankers Assoc. Interest Settlement
Rates Page” display designated on the Moneyline Telerate for the purpose of displaying
the rates at which Sterling or euro deposits, as applicable, are offered by leading banks in
the London interbank deposit market.

     “UK Cash Management Advance” shall mean any short term loan or other advance
made under the UK Cash Management Agreement, including with respect to or arising out of
overdrafts on deposit or other accounts or out of electronic funds transfers (whether by
wire transfer or through automated clearing houses or otherwise) or out of the return
unpaid of, or other failure of the Sterling Swing Line Lender to receive final payment for,
any check, item, instrument, payment order or other deposit or credit to a deposit or other
account, or out of Sterling Swing Line Lender’s non-receipt of or inability to collect
funds or otherwise not being made whole in connection with depository or other similar
arrangements.

     “UK Cash Management Agreement” shall mean any agreement between the Sterling
Swing Line Lender and the Sterling Subsidiary Borrowers on terms and conditions reasonably
satisfactory to the Sterling Administrative Agent providing for a committed facility for
overdraft protection advances and short term loans in an aggregate amount not to exceed
U.S.$20,000,000, as such Agreement may be amended or extended from time to time.

SECTION 2.   THE STERLING COMMITMENTS

          2.1.   The Sterling Commitments. Subject to the terms and conditions hereof, each
Sterling Lender severally (but not jointly) agrees to make Sterling Loans in Sterling or euros to
each Sterling Subsidiary Borrower from time to time during the Revolving Credit Commitment Period
in an aggregate principal amount not to exceed the Available Sterling Commitment of such Sterling
Lender in accordance with the terms hereof (which for this purpose shall be computed as though the
amount in subclause (b)(i) in the definition thereof is U.S.$0); provided that, after
giving effect to the making of such Sterling Loans, the Aggregate Sterling Revolving Extensions of
Credit will not exceed the Sterling Commitment. During the Revolving Credit Commitment Period, the
Sterling Subsidiary Borrowers may use the Sterling Commitments by
borrowing, repaying the Sterling Loans in whole or in part, and reborrowing, all in accordance
with the terms and conditions hereof. Each Sterling Lender agrees that

 

6

each of its Lending
Installations listed on Schedule 1 and subsequently agreed from time to time in the United Kingdom
shall be on the date hereof or the date of such agreement an Eligible U.K. Bank.

          2.2.   Procedure for Sterling Loan Borrowing. (a) The Sterling Subsidiary Borrowers
may borrow under the Sterling Facility during the Revolving Credit Commitment Period on any
Business Day (U.K.); provided that the relevant Sterling Subsidiary Borrower shall give the
Sterling Administrative Agent irrevocable notice (1) on the requested Borrowing Date (U.K.), in the
case of Reference Rate Loans (which notice must be received by the Sterling Administrative Agent
prior to 11:00 A.M., London time) and (2) two Business Days (U.K.) prior to the requested Borrowing
Date (U.K.), in the case of LIBOR Loans in Sterling (which notice must be received by the Sterling
Administrative Agent prior to 11:00 A.M., London time), and (3) three Business Days (U.K.) prior to
the requested Borrowing Date (U.K.), in the case of LIBOR Loans in euros (which notice must be
received by the Sterling Administrative Agent prior to 11:00 A.M., London time), specifying (i) the
identity of the Sterling Subsidiary Borrower borrowing and the amount and currency to be borrowed,
(ii) the requested Borrowing Date (U.K.), (iii) whether the borrowing is to be a Reference Rate
Loan (in the case of Sterling Loans in Sterling) or a LIBOR Loan or a combination thereof, and (iv)
if the borrowing is to be entirely or partly a LIBOR Loan, the amount to be a LIBOR Loan and the
length of the Interest Period for such LIBOR Loan. Each Reference Rate borrowing by any Sterling
Subsidiary Borrower pursuant to the Sterling Commitments shall be in an aggregate principal amount
equal to the Sterling equivalent of U.S.$1,000,000 or a whole multiple of the Sterling equivalent
of U.S.$500,000 in excess thereof. Each LIBOR borrowing by any Sterling Subsidiary Borrower
pursuant to the Sterling Commitments shall be in an aggregate principal amount equal to the
Sterling or euro equivalent, as the case may be, of U.S.$1,000,000 or a whole multiple of the
Sterling or euro equivalent, as the case may be, of U.S.$500,000 in excess thereof.

          (a)   Upon receipt of any notice from a Sterling Subsidiary Borrower pursuant to this
subsection 2.2, the Sterling Administrative Agent shall promptly notify each Sterling Lender
thereof. Each such Sterling Lender will make the amount of its ratable share (subject to
subsection 2.1) of each borrowing available to the Sterling Administrative Agent for the account of
the such Sterling Subsidiary Borrower at the Sterling Administrative Office prior to 2:00 P.M.,
London time, on the Borrowing Date (U.K.) requested by the such Sterling Subsidiary Borrower in
funds immediately available to the Sterling Administrative Agent. Such borrowing will then be made
available to such Sterling Subsidiary Borrower by the Sterling Administrative Agent crediting the
account of such Sterling Subsidiary Borrower on the books of such office with the aggregate of the
amounts made available to the Sterling Administrative Agent by such Sterling Lenders.

          2.3.   Swing Line Commitments. (a) Subject to the terms and conditions hereof, from
time to time prior to the Revolving Credit Termination Date and to the Sterling Subsidiary
Borrowers (i) the Sterling Swing Line Lender agrees to make Sterling Swing Line Loans in Sterling
in an aggregate principal amount not to exceed the Sterling equivalent of U.S.$20,000,000 at any
one time outstanding (each of the foregoing individually, a “Sterling Swing Line Loan”;
collectively the “Sterling Swing Line Loans”); provided that, after giving effect
to the making of such Sterling Swing Line Loans, the aggregate principal amount of Swing Line Loans
under any Revolving Facility at any one time outstanding shall not exceed U.S.$100,000,000 and the
Aggregate Sterling Revolving Extensions of Credit shall not exceed the Sterling Commitments. All
Sterling Swing Line Loans shall be made as Reference Rate Loans. The relevant Sterling Subsidiary
Borrowers shall give the Sterling Administrative Agent irrevocable notice
(which notice must be received by the Sterling Administrative Agent at or prior to 1:00 P.M.,
London time, on the requested Borrowing Date (U.K.)), specifying the amount of each requested
Sterling Swing Line Loan, which shall be greater than or equal to a minimum amount to be agreed
upon by such Sterling Subsidiary Borrowers and the relevant Sterling Swing Line Lender. Upon such
notice, the Sterling Administrative Agent shall promptly notify the Sterling Swing Line Lender
thereof. The Sterling Swing

 

7

Line Lender shall make the amount of each borrowing available to the
relevant Sterling Subsidiary Borrowers in the manner directed by the Sterling Administrative Agent
on the requested Borrowing Date; provided, notwithstanding the foregoing and without
necessity of any notice to Sterling Administrative Agent, any UK Cash Management Advance made by
the Sterling Swing Line Lender under the UK Cash Management Agreement shall constitute a Sterling
Swing Line Loan, and shall reduce availability for additional Swing Line Loans under this
subsection 2.3 in an amount equal to the amount of UK Cash Management Advances hereunder
outstanding at any time. The Sterling Swing Line Lender shall give notice to the Sterling
Administrative Agent on a daily basis of the outstanding principal balance of UK Cash Management
Advances.

          (b)   The Sterling Swing Line Lender in its sole and absolute discretion, may, on behalf of
the relevant Sterling Subsidiary Borrower (which hereby irrevocably directs the Sterling Swing Line
Lender to act on its behalf), request each Sterling Lender, including the Sterling Swing Line
Lender, with respect to all other Sterling Swing Line Loans, to make a Sterling Loan, in an amount
equal to such Sterling Lender’s Revolving Percentage under the Sterling Facility of the amount of
the Sterling Swing Line Loans (the “Refunded Sterling Swing Line Loans”) outstanding on the
date such notice is given. Unless any of the events described in paragraph (f) of Section 8 of the
Credit Agreement shall have occurred (in which event the procedures of paragraph (c) of this
subsection 2.3 shall apply), each Sterling Lender shall make the proceeds of its Sterling Loan
available to the Sterling Administrative Agent for the account of the Sterling Swing Line Lender,
at the office of the Sterling Administrative Agent prior to 12:00 Noon (London time) in funds
immediately available on the Business Day (U.K.) next succeeding the date such notice is given.
The proceeds of such Sterling Loans shall be immediately applied to repay the Refunded Sterling
Swing Line Loans.

          (c)   If, prior to the making of a Sterling Swing Line Loan pursuant to paragraph (b) of this
subsection 2.3, one of the events described in paragraph (f) of Section 8 of the Credit Agreement
shall have occurred, each Sterling Lender hereby agrees to and will, on the date such Sterling
Swing Line Loan was to have been made, purchase an undivided participating interest in each
Refunded Sterling Swing Line Loan in an amount equal to its Revolving Percentage under the Sterling
Facility of such Refunded Sterling Swing Line Loan. Such Revolving Credit Lender will immediately
transfer to the Sterling Administrative Agent for the account of the Sterling Swing Line Lender, in
immediately available funds of the amount of its participations and, upon its receipt of its
ratable share thereof, the Sterling Swing Line Lender will deliver to such Sterling Lender a Swing
Line Loan Participation Certificate dated the date of receipt of such funds and in such amount.

          (d)   Whenever, at any time after the Sterling Swing Line Lender has received from any
Sterling Lender such Sterling Lender’s participating interest in a Refunded Sterling Swing Line
Loan and the Sterling Swing Line Lender receives any payment on account thereof, the Sterling Swing
Line Lender will distribute to such Sterling Lender through the Sterling Administrative Agent its
participating interest; provided, however, that in the event that such payment
received by the Sterling Swing Line Lender is required to be returned, such Sterling Lender will
return to the Sterling Swing Line Lender through the Sterling Administrative Agent any portion
thereof previously distributed by the Sterling Swing Line Lender to it.

          2.4.   Participation. Each Sterling Lender’s obligation to purchase participating interests pursuant to paragraph
(c) of this subsection 2.3 shall be absolute and unconditional and shall not be affected by any
circumstances, including, without limitation, (a) any set-off, counterclaim, recoupment, defense or
other right which such Sterling Lender may have against the Sterling Swing Line Lender, any
Sterling Subsidiary Borrower or any other Person for any reason whatsoever; (b) the occurrence or
continuance of an Event of Default; (c) any adverse change in the condition (financial or
otherwise) of the Borrower or any Sterling Subsidiary Borrower; (d) any breach of the Credit
Agreement by the Borrower,

 

8

any Subsidiary Borrower or any other Revolving Credit Lender; or (e) any
other circumstance, happening or event whatsoever, whether or not similar to any of the foregoing.
Notwithstanding the foregoing, no Sterling Lender shall have any obligation to purchase
participating interests pursuant to paragraph (c) of this subsection 2.3 or to make any Refunded
Sterling Swing Line Loans in respect of any Sterling Swing Line Loan which was made at any time
following receipt by the Sterling Administrative Agent of a notice from any Sterling Lender
specifying that (x) a Default or Event of Default has occurred and is continuing and (y) explicitly
stating that such Sterling Lender will not purchase such participating interests or make Refunded
Sterling Swing Line Loans with respect to Sterling Swing Line Loans made after the date of receipt
of such notice.

          2.5.   Repayment of Sterling Loans; Evidence of Debt. (a) Each Sterling Subsidiary
Borrower hereby unconditionally promises to pay to the Sterling Administrative Agent for the
account of each Sterling Lender (i) then unpaid principal amount of each Sterling Loan of such
Sterling Lender on the Revolving Credit Termination Date (or such earlier date on which the Loans
become due and payable pursuant to Section 8 of the Credit Agreement) and (ii) then unpaid
principal amount of the Sterling Swing Line Loans of the Sterling Swing Line Lender on the
Revolving Credit Termination Date (or such earlier date on which the Sterling Swing Line Loans
become due and payable pursuant to Section 8 of the Credit Agreement). Each Sterling Subsidiary
Borrower hereby unconditionally promises to pay to the Sterling Administrative Agent for the
account of such Lender (i) then unpaid principal amount of each Loan to such Subsidiary Borrower on
the Revolving Credit Termination Date (or such earlier date on which the Revolving Credit Loans
become due and payable pursuant to Section 8 of the Credit Agreement) and (ii) then unpaid
principal amount of the Sterling Swing Line Loans to such Subsidiary Borrower of the Sterling Swing
Line Lender on the Revolving Credit Termination Date (or such earlier date on which the Sterling
Swing Line Loans became due and payable pursuant to Section 8 of the Credit Agreement). Each
Sterling Subsidiary Borrower hereby further agrees to pay interest on the unpaid principal amount
of the Sterling Loans from time to time outstanding to such Sterling Subsidiary Borrower from the
date hereof until payment in full thereof at the rates per annum, and on the dates, set forth in
subsection 2.12.

          (a)   Each Sterling Lender shall maintain in accordance with its usual practice an account or
accounts evidencing indebtedness of the Sterling Subsidiary Borrowers to such Sterling Lender
resulting from each Sterling Loan of such Sterling Lender from time to time, including the amounts
of principal and interest payable and paid to such Sterling Lender from time to time under the
Credit Agreement.

          (b)   The Sterling Administrative Agent shall maintain a register (the “Sterling
Register”) in respect of the Sterling Facility in a manner similar to the Register described in
Section 10.6(b)(iv) of the Credit Agreement, and a subaccount therein for each Sterling Lender, in
which shall be recorded (i) the amount of each Sterling Loan made hereunder and the type thereof,
(ii) the amount of any principal or interest due and payable or to become due and payable from any
Sterling Subsidiary Borrower to each Sterling Lender hereunder and (iii) both the amount of any sum
received by the Sterling Administrative Agent hereunder from any Sterling Subsidiary Borrower and
each Sterling Lender’s share thereof.

          (c)   The entries made in the Sterling Register and the accounts of each Sterling Lender
maintained pursuant to subsection 2.5(b) shall, to the extent permitted by applicable law, be
prima facie evidence of the existence and amounts of the obligations of each
Sterling Subsidiary Borrower therein recorded; provided, however, that the failure
of any Sterling Lender or the Sterling Administrative Agent to maintain the Sterling Register or
any such account, or any error therein, shall not in any manner affect the obligation of any
Sterling Subsidiary Borrower to repay (with applicable interest) the Sterling Loans made to such
Sterling Subsidiary Borrower by such Sterling Lender in accordance with the terms of the Credit
Agreement.

 

9

          2.6.   [reserved]

          2.7.   Termination or Reduction of the Sterling Commitments.

          (a) Optional. The Sterling Subsidiary Borrowers shall have the right, upon not less
than five Business Days’ (U.K.) written notice to the Sterling Administrative Agent, to terminate
the Sterling Commitments or, from time to time, reduce the amount of the Sterling Commitments,
provided that (i) any such reduction shall be accompanied by prepayment of the Sterling
Loans by the relevant Sterling Subsidiary Borrower, together with accrued interest on the amount so
prepaid to the date of such prepayment, to the extent, if any, the Available Sterling Commitments
would be negative and (ii) any such termination of the Sterling Commitments shall be accompanied by
(A) prepayment in full of the Sterling Loans then outstanding hereunder, (B) cash collateralization
of all Sterling L/C Obligations then outstanding in accordance with the provisions of subsection
2.10, and (C) payment of accrued interest thereon to the date of such prepayment and the payment of
any unpaid fees then accrued hereunder (including, without limitation, in respect of any Sterling
Letters of Credit). Upon receipt of such notice, the Sterling Administrative Agent shall promptly
notify each Lender thereof. Any such reduction shall be in an amount equal to the Sterling or euro
equivalent, as the case may be, of U.S.$1,000,000 or a whole multiple of the Sterling or euro
equivalent, as the case may be, of U.S.$500,000 in excess thereof and shall reduce permanently the
amount of the Sterling Commitments then in effect.

          (b)   Mandatory. The Revolving Credit Commitments shall automatically terminate on
the Revolving Credit Termination Date and all Sterling Loans shall be repaid and to the extent any
Sterling Letter of Credit remains outstanding after the Revolving Credit Termination Date, the
relevant Sterling Subsidiary Borrower shall cash collateralize such Sterling L/C Obligations (and
the fees thereon) in accordance with the provisions of subsection 2.10. The Revolving Credit
Commitments shall also be reduced in accordance with subsection 2.9.

          2.8.   Optional Prepayments. Any Sterling Subsidiary Borrower may, at any time
and from time to time, prepay the Sterling Loans made to it hereunder, in each case in whole or in
part, without premium or penalty, upon at least one Business Day’s (U.K.) irrevocable notice to the
Sterling Administrative Agent, specifying the date and amount of prepayment. If such notice is
given, the relevant Sterling Subsidiary Borrower shall make such prepayment and the payment amount
specified in such notice shall be due and payable on the date specified therein, together with
accrued interest to such date on the amount prepaid. Partial prepayments shall be in an aggregate
principal amount of the Sterling or euro equivalent, as the case may be, of U.S.$1,000,000 or a
whole multiple of the Sterling or euro equivalent, as the case may be, of U.S.$500,000 in excess
thereof.

          2.9.   Mandatory Prepayments. The Sterling Subsidiary Borrowers, without notice or demand, shall immediately prepay the
Sterling Loans, to the extent, if any, that the Available Sterling Commitments are negative,
together with accrued interest to the date of such prepayment on the amount so prepaid;
provided that if such prepayment is required solely as a result of a change in the
aggregate Dollar Equivalent of the Sterling Loans, no prepayment shall be made unless such
prepayment is required pursuant to subsection 2.21.

          2.10.   Cash Collateralization of Sterling Letters of Credit. To the extent that at
any time and from time to time, the Sterling L/C Obligations exceed the amount of the Sterling L/C
Commitments or the Sterling L/C Obligations exceed the Sterling Commitments (whether pursuant to
subsections 2.7, 2.8, 2.9 or otherwise), the Sterling Subsidiary Borrowers shall cash collateralize
(in a manner reasonably satisfactory to the Sterling Administrative Agent) such portion of the
Sterling L/C Obligations (and the fees thereon through the stated expiration date of the Sterling
Letters of Credit giving rise to such Sterling

 

10

L/C Obligations) which is in excess of the Sterling
L/C Commitments or such Sterling Commitments, as applicable.

          2.11.   Conversion Options. (a)   Any Sterling Subsidiary Borrower may elect from
time to time to convert LIBOR Loans in Sterling to Reference Rate Loans, and may elect from time to
time to convert Reference Rate Loans to LIBOR Loans, by giving the Sterling Administrative Agent at
least three Business Days’ (U.K.) prior irrevocable written notice of such election to convert
(which date shall be a Business Day (U.K.) and in the case of any conversion of any LIBOR Loans in
Sterling to Reference Rate Loans, the last day of an Interest Period therefor), the amount and type
of conversion and, in the case of any conversion of Reference Rate Loans to LIBOR Loans, the
Interest Period selected with respect thereto; provided, however, that (i)
Reference Rate Loans may not be converted to LIBOR Loans when any Default or Event of Default has
occurred and is continuing without the consent of the Administrative Agent and (ii) Swing Line
Loans may not, at any time, be converted to LIBOR Loans. All or any part of outstanding LIBOR
Loans or Reference Rate Loans may be converted as provided herein, provided that partial
conversions of LIBOR Loans in Sterling to Reference Rate Loans shall be in an aggregate principal
amount of the Sterling equivalent of U.S.$1,000,000 or a whole multiple thereof and partial
conversions of Reference Rate Loans to LIBOR Loans with respect to which a common Interest Period
has been selected shall be in an aggregate principal amount of the Sterling or euro equivalent, as
the case may be, of U.S.$1,000,000 or a whole multiple thereof and provided,
further, that in the case of a partial conversion of LIBOR Loans in Sterling to Reference
Rate Loans, after giving effect to such conversion, the aggregate principal amount of the LIBOR
Loans outstanding with respect to which a common Interest Period has been selected shall be not
less than the Sterling or euro equivalent, as the case may be, of U.S.$5,000,000.

          (b)   Any LIBOR Loans may be continued as such upon the expiration of an Interest Period by
compliance by the Sterling Subsidiary Borrowers with the notice provisions contained in the
definition of Interest Period, provided that no LIBOR Loan may be continued as such when
any Default or Event of Default has occurred and is continuing, but shall be automatically
converted to a Reference Rate Loan on the last day of the last Interest Period for which a LIBOR
Rate was determined by the Sterling Administrative Agent on or prior to the Sterling Administrative
Agent’s obtaining knowledge of such Default or Event of Default.

          (c)   No conversion or continuation of any Sterling Loans shall be made pursuant to this
subsection 2.11 if, after giving effect to such conversion or continuation the amount of the
Available Sterling Commitments would be negative.

          2.12.   Interest Rate and Payment Dates.

          (a)   Each LIBOR Loan shall bear interest for each day during each Interest Period with
respect thereto at a rate per annum equal to the LIBOR Rate determined for such Interest Period
plus the Applicable Margin.

          (b)   Each Reference Rate Loan shall bear interest for the period from and including the date
thereof until maturity at a rate per annum equal to the Reference Rate plus the Applicable Margin.

          (c)   If all or a portion of (i) the principal amount of any Sterling Loan or any
reimbursement obligation, (ii) any interest payable thereon or (iii) any facility fee, commission
or other amount payable hereunder shall not be paid when due (whether at the stated maturity, by
acceleration or otherwise), such overdue amount shall bear interest at a rate per annum which is
(A) the rate pursuant to paragraph (a) of this subsection plus 2% or (B) the rate described in
paragraph (b) of this subsection 2.12 plus 2%, in each case from the date of such non-payment until
such amount is paid in full (as well after as

 

11

before judgment). The Sterling Administrative Agent
may choose any Interest Period from time to time (including one Interest Period of shorter than one
month) with respect to any overdue amount bearing interest based upon paragraph (a) of this
subsection.

          (d)   Interest shall be payable in arrears on each Interest Payment Date, except that interest
payable pursuant to subsection 2.12(c) shall be payable upon demand.

          2.13.   Computation of Interest and Fees. (a)   Each determination of an interest rate
by the Sterling Administrative Agent pursuant to any provision of this Annex B shall be conclusive
and binding on the Sterling Subsidiary Borrowers absent manifest error.

          (b)   Interest (other than interest based on the Reference Rate) shall be calculated on the
basis of a 360-day year for the actual days elapsed; and facility fees and interest based on the
Reference Rate shall be calculated on the basis of a 365- (366-, as the case may be) day year for
the actual days elapsed. The Sterling Administrative Agent shall as soon as practicable notify the
affected Sterling Lenders of each determination of the LIBOR Rate. Any change in the interest rate
on a Sterling Loan resulting from a change in the Reference Rate or any LIBOR reserve requirements
shall become effective as of the opening of business on the day on which such change becomes
effective. The Sterling Administrative Agent shall as soon as practicable notify the affected
Sterling Lenders of the Closing Date and the amount of such change in interest rate.

          (c)   The Sterling Administrative Agent shall, at the request of the Sterling Subsidiary
Borrowers or any Sterling Lender, deliver to the Sterling Subsidiary Borrowers or such Sterling
Lender a statement showing in reasonable detail the calculations used by the Sterling
Administrative Agent in determining any interest rate pursuant to subsection 2.12, excluding any
LIBOR Base Rate which is based upon the British Bankers Assoc. Interest Settlement Rates Page.

          2.14.   Inability to Determine Interest Rate. In the event that the Reference Banks
shall have reasonably determined (which determination shall be conclusive and binding upon the
Sterling Subsidiary Borrowers absent manifest error) that by reason of circumstances affecting the
interbank eurocurrency market, adequate and reasonable means do not exist for ascertaining the
LIBOR Rate applicable pursuant to subsection 2.12(a) for any Interest Period with respect to (a) a
proposed Sterling Loan that has been requested be made as a
LIBOR Loan, (b) a LIBOR Loan that will result from the requested conversion of a Reference
Rate Loan into a LIBOR Loan or (c) the continuation of LIBOR Loans beyond the expiration of then
current Interest Period with respect thereto, the Sterling Administrative Agent shall forthwith
give telecopy or telephonic notice of such determination, confirmed in writing, to the relevant
Sterling Subsidiary Borrowers and the Sterling Lenders at least one Business Day (U.K.) prior to,
as the case may be, the requested Borrowing Date (U.K.) for such LIBOR Loan, the conversion date of
such Reference Rate Loan or the last day of such Interest Period. If such notice is given (i) any
requested LIBOR Loan shall be made as a Reference Rate Loan, (ii) any Reference Rate Loan that was
to have been converted to a LIBOR Loan shall be continued as a Reference Rate Loan and (iii) any
outstanding LIBOR Loan shall be converted, on the last day of then current Interest Period with
respect thereto, to a Reference Rate Loan. Until such notice has been withdrawn by the Sterling
Administrative Agent, no further LIBOR Loans shall be made nor shall the Sterling Subsidiary
Borrowers have the right to convert a Reference Rate Loan to a LIBOR Loan. Such notice shall be
withdrawn by the Sterling Administrative Agent when the Sterling Administrative Agent shall
reasonably determine that adequate and reasonable means exist for ascertaining the LIBOR Rate.

          2.15.   Pro Rata Treatment and Payments. (a)   Each borrowing under and any reduction
of the Sterling Commitments shall be made ratably according to each Sterling Lender’s share of the
Sterling Commitments.

 

12

          (b)   Each payment (including each prepayment) on account of principal of and interest on the
Sterling Loans shall be made ratably according to the respective outstanding principal amounts of
such Loans then held by the Sterling Lenders.

          (c)   All payments (including prepayments) to be made by any Sterling Subsidiary Borrower
hereunder, whether on account of principal, interest, fees or otherwise, shall be made without set
off or counterclaim and shall be made prior to 12:00 Noon, London time, on the due date thereof to
the Sterling Administrative Agent, for the account of the relevant Sterling Lenders, at the
Sterling Administrative Office office, in Sterling, and in immediately available funds. The
Sterling Administrative Agent shall distribute such payments to the relevant Sterling Lenders
promptly upon receipt in like funds as received. If any payment hereunder (other than payments on
LIBOR Loans) becomes due and payable on a day other than a Business Day (U.K.), such payment shall
be extended to the next succeeding Business Day (U.K.) and such extension of time shall in such
case be included in the computation of the amount payable hereunder. If any payment on a LIBOR
Loan becomes due and payable on a day other than a Business Day (U.K.), the maturity thereof shall
be extended to the next succeeding Business Day (U.K.) unless the result of such extension would be
to extend such payment into another calendar month, in which event such payment shall be made on
the immediately preceding Business Day (U.K.).

          (d)   Unless the Sterling Administrative Agent shall have been notified in writing by any
Sterling Lender prior to a Borrowing Date (U.K.) that such Sterling Lender will not make the amount
that would constitute its share of the borrowing on such date available to the Sterling
Administrative Agent, the Sterling Administrative Agent may assume that such Sterling Lender has
made such amount available to the Sterling Administrative Agent on such Borrowing Date (U.K.), and
the Sterling Administrative Agent may, in reliance upon such assumption, make available to the
relevant Sterling Subsidiary Borrower a corresponding amount. If such amount is made available to
the Sterling Administrative Agent on a date after such Borrowing Date (U.K.), such Sterling Lender
shall pay to the Sterling Administrative Agent on demand an amount equal to the product of (i) the
customary rate as selected by the Sterling Administrative Agent for the settlement of obligations
between banks during such period as quoted by the Sterling Administrative Agent, times (ii)
the amount of such Sterling Lender’s share of such borrowing,
times (iii) a fraction the numerator of which is the number of days that elapse from
and including such Borrowing Date (U.K.) to the date on which such Sterling Lender’s Revolving
Percentage of such borrowing shall have become immediately available to the Sterling Administrative
Agent and the denominator of which is 360 (the “Effective Interbank Rate”). A certificate
of the Sterling Administrative Agent submitted to any Sterling Lender with respect to any amounts
owing under this subsection shall be conclusive in the absence of manifest error. If such amount
is so made available, such payment to the Sterling Administrative Agent shall constitute such
Sterling Lender’s Loan on such Borrowing Date (U.K.) for all purposes of this Agreement. If such
amount is not so made available to the Sterling Administrative Agent, then the Sterling
Administrative Agent shall notify the relevant Sterling Subsidiary Borrower of such failure and on
the fourth Business Day (U.K.) following such Borrowing Date (U.K.), such Sterling Subsidiary
Borrower shall pay to the Sterling Administrative Agent such ratable portion, together with
interest thereon for each day that such Sterling Subsidiary Borrower had the use of such ratable
portion, at the Effective Interbank Rate. Nothing contained in this subsection 2.15(d) shall
relieve any Sterling Lender which has failed to make available its ratable portion of any borrowing
hereunder from its obligation to do so in accordance with the terms hereof.

          (e)   The failure of any Sterling Lender to make the Sterling Loan to be made by it on any
Borrowing Date (U.K.) shall not relieve any other Sterling Lender of its obligation, if any,
hereunder to make its Sterling Loan on such Borrowing Date (U.K.), but no Sterling Lender shall be
responsible for the failure of any other Sterling Lender to make the Sterling Loan to be made by
such other Sterling Lender on such Borrowing Date (U.K.).

 

13

          2.16.   Illegality. Notwithstanding any other provisions herein, if any introduction
of or change in any law, regulation, treaty or directive or in the interpretation or application
thereof occurring after the date hereof shall make it unlawful for any Sterling Lender to make or
maintain LIBOR Loans as contemplated by this Annex B, (a) such Sterling Lender shall forthwith give
telecopy or telephonic notice of such circumstances, confirmed in writing, to the relevant Sterling
Subsidiary Borrower (which notice shall be withdrawn by such Sterling Lender when such Sterling
Lender shall reasonably determine that it shall no longer be illegal for such Sterling Lender to
make or maintain LIBOR Loans or to convert Reference Rate Loans to LIBOR Loans), (b) the commitment
of such Sterling Lender hereunder to make LIBOR Loans or to convert Reference Rate Loans to LIBOR
Loans shall forthwith be canceled and (c) such Sterling Lender’s Sterling Loans then outstanding as
LIBOR Loans, if any, shall be converted automatically to Reference Rate Loans based upon the
Reference Rate on the last day of then current Interest Period with respect to such Loans or within
such earlier period as may be required by law. Each Sterling Subsidiary Borrower hereby agrees
promptly to pay the Sterling Administrative Agent for the account of each Sterling Lender, upon
demand by the Sterling Administrative Agent, any additional amounts necessary to compensate the
Sterling Lenders for any costs incurred by the Sterling Lenders in making any conversion in
accordance with this subsection 2.16, including, but not limited to, any interest or fees payable
by the Sterling Lenders to lenders of funds obtained by them in order to make or maintain their
LIBOR Loans hereunder (the Sterling Administrative Agent’s notice of such costs, as certified to
such Sterling Subsidiary Borrower, to be conclusive, absent manifest error).

          2.17.   Requirements of Law. (a) In the event that any introduction of or change in
any law, regulation, treaty or directive or in the interpretation or application thereof occurring
after the date hereof or compliance by any Sterling Lender with any request or directive (whether
or not having the force of law) from any central bank or other governmental authority, agency or
instrumentality:

          (i)   shall subject such Sterling Lender to any tax of any kind, whatsoever with respect to
the Credit Agreement, including this Annex B, any Sterling Letter of Credit, any Application, or
any Sterling Loan made by it or its obligation to make Sterling Loans or change the basis of
taxation of payments to such Sterling Lender of principal, facility fee, interest or any other
amount payable hereunder (other than Non-Excluded Taxes (as defined in subsection 2.19) or changes
in the rate of tax on the overall net income of such Sterling Lender)

          (ii)   shall impose, modify or hold applicable any reserve, special deposit, compulsory loan
or similar requirement against assets held by, or deposits or other liabilities in or for the
account of, advances or loans by, or other credit extended by, or any other acquisition of funds
by, any office of such Sterling Lender which are not otherwise included in the determination of the
LIBOR Rate hereunder, or

          (iii)   shall impose on such Sterling Lender or the eurocurrency market any other condition;

and the result of any of the foregoing is to increase the cost to such Sterling Lender (which
increase in cost shall be the result of such Sterling Lender’s reasonable allocation of the
aggregate of such cost increases resulting from such events), of making, renewing or maintaining
LIBOR Loans or issuing or participating in Sterling Letters of Credit or to reduce any amount
receivable thereunder then, in any such case, the relevant Sterling Subsidiary Borrower shall, upon
notice to it from such Sterling Lender (with a copy to the Administrative Agent) certifying that
(x) one of the events described in this subsection 2.17(a) has occurred and the nature of such
event, (y) the increased cost or reduced amount resulting from such event and (z) the additional
amounts demanded by such Sterling Lender and a reasonably detailed explanation of the calculation
thereof, promptly pay to the Sterling Administrative Agent for the account of the relevant Sterling
Lender, upon demand by the Sterling Administrative Agent, without duplication, any additional
amounts necessary to compensate such Sterling Lender for such increased cost or reduced

 

14

amount receivable which such Sterling Lender deems to be material as determined in good faith by such
Sterling Lender with respect to the Credit Agreement, including this Annex B, or the Sterling Loans
made hereunder, provided that, in any such case, the relevant Sterling Subsidiary Borrower
(if otherwise not prohibited hereunder) may elect to convert the LIBOR Loans made hereunder to
Reference Rate Loans by giving such Sterling Lender and the Sterling Administrative Agent at least
one Business Day’s (U.K.) prior irrevocable notice of such election in which case the relevant
Sterling Subsidiary Borrower shall promptly pay the Sterling Administrative Agent for the account
of the relevant Sterling Lender, upon demand by the Sterling Administrative Agent, without
duplication, any loss or expense incurred by such Sterling Lender in liquidating or re-employing
the deposits from which the funds were obtained by such Sterling Lender for the purpose of making
and/or maintaining such LIBOR Loans, together with any amount due under this subsection 2.17(a) in
respect of the period prior to such conversion. If such Sterling Lender becomes entitled to claim
any additional amounts pursuant to this subsection, it shall promptly notify the relevant Sterling
Subsidiary Borrower of the event by reason of which it has become so entitled.

          (b)   In the event that any Sterling Lender shall have determined that any change in any
Requirement of Law regarding capital adequacy or in the interpretation or application thereof or
compliance by such Sterling Lender or any corporation controlling such Sterling Lender with any
request or directive regarding capital adequacy (whether or not having the force of law) from any
Governmental Authority made subsequent to the date hereof does or shall have the effect of reducing
the rate of return on such Sterling Lender’s or such corporation’s capital as a consequence of its
obligations hereunder or under any Letters of Credit to a level below that which such Sterling
Lender or such corporation could have achieved but for such change or compliance (taking into
consideration such Sterling Lender’s or such corporation’s policies with respect to capital
adequacy) by an amount deemed by such Sterling Lender to be material, then from time to time,
within 15 days after submission by such Sterling Lender to
the Sterling Subsidiary Borrowers (with a copy to the Sterling Administrative Agent) of a
written request therefor certifying that (x) one of the events described in this subsection 2.17(b)
has occurred and the nature of such event, (y) the increased cost or reduced amount resulting from
such event and (z) the additional amounts demanded by such Sterling Lender and a reasonably
detailed explanation of the calculation thereof, the Sterling Subsidiary Borrowers shall pay to
such Sterling Lender such additional amount or amounts as will compensate such Sterling Lender for
such reduction.

          (c)   A certificate as to any additional amounts payable pursuant to paragraphs (a) and (b)
above submitted by any Sterling Lender to a Sterling Subsidiary Borrower shall be conclusive absent
manifest error.

          2.18.   Indemnity. Each Sterling Subsidiary Borrower agrees to indemnify each
Sterling Lender and to hold each Sterling Lender harmless from any loss or expense which such
Sterling Lender may sustain or incur as a consequence of (a) default by such Sterling Subsidiary
Borrower in payment of the principal amount of or interest on any LIBOR Loans including, but not
limited to, any such loss or expense arising from interest or fees payable by such Sterling Lender
to lenders of funds obtained by them in order to maintain their LIBOR Loans, (b) default by such
Sterling Subsidiary Borrower in making LIBOR Loans or conversion after such Sterling Subsidiary
Borrower has given a notice in accordance with subsection 2.2 or 2.11, (c) default by such Sterling
Subsidiary Borrower in making any prepayment of a LIBOR Loan after such Sterling Subsidiary
Borrower has given a notice in accordance with subsection 2.8, and (d) the making of any payment or
conversion of LIBOR Loans on a day which is not the last day of the applicable Interest Period with
respect thereto, including, but not limited to, any such loss or expense arising from interest or
fees payable by the Sterling Lenders to lenders of funds obtained by them in order to maintain
their LIBOR Loans hereunder. This covenant shall survive termination of the Credit Agreement. The
obligations of indemnity of each of the respective Sterling Subsidiary Borrowers hereunder are
limited only to the loss and expense described herein arising from or as a result

 

15

of any act or
omission by such Sterling Subsidiary Borrower, and are not, and shall not be deemed to be, the
joint and several obligations of each such Sterling Subsidiary Borrower as to any loss or expense
arising from or as a result of any act or omission by the other Sterling Subsidiary Borrowers.

          2.19.   Taxes. All payments made by the Sterling Subsidiary Borrowers in
respect of amounts owing under this Annex B shall be made free and clear of, and without deduction
or withholding for or on account of, any present or future income, stamp or other taxes, levies,
imposts, duties, charges, fees, deductions or withholdings, now or hereafter imposed, levied,
collected, withheld or assessed by any Governmental Authority, excluding gross or net income or
gross receipts taxes, ad valorem taxes, personal property and/or sales taxes and franchise taxes
(imposed in lieu of net income taxes) imposed on the Sterling Administrative Agent or any Sterling
Lender as a result of a present or former connection between the Sterling Administrative Agent or
such Sterling Lender and the jurisdiction of the Governmental Authority imposing such tax or any
political subdivision or taxing authority thereof or therein (other than any such connection
arising solely from the Sterling Administrative Agent or such Sterling Lender having executed,
delivered or performed its obligations or received a payment under, or enforced, this Annex B). If
any such non-excluded taxes, levies, imposts, duties, charges, fees deductions or withholdings
(“Non-Excluded Taxes”) are required to be withheld from any amounts payable to the Sterling
Administrative Agent or any Sterling Lender hereunder, the amounts so payable to the Sterling
Administrative Agent or such Sterling Lender shall be increased to the extent necessary to yield to
the Sterling Administrative Agent or such Sterling Lender (after payment of all Non-Excluded Taxes)
interest or any such other amounts payable hereunder at the rates or in the amounts specified in
this Annex B,
provided, however, that none of the Sterling Subsidiary Borrowers shall be
required to increase any such amounts payable to the Sterling Administrative Agent or any Sterling
Lender if such increased amount arises as a result of the failure of such Sterling Lender or the
Sterling Administrative Agent to be an Eligible U.K. Bank. The Sterling Subsidiary Borrowers shall
also indemnify the Sterling Administrative Agent and each Sterling Lender on an after-tax basis for
any additional taxes on net income which the Sterling Administrative Agent or such Sterling Lender,
as the case may be, may be obligated to pay as a result of the receipt of additional amounts under
this subsection 2.19. Whenever any Non-Excluded Taxes are payable by any Sterling Subsidiary
Borrower, as promptly as possible thereafter but in any event within 45 days after the date of
payment such Sterling Subsidiary Borrower shall send to the Sterling Administrative Agent for its
own account or for the account of such Sterling Lender, as the case may be, a certified copy of an
original official receipt received by such Sterling Subsidiary Borrower showing payment thereof.
If any Sterling Subsidiary Borrower fails to pay any Non-Excluded Taxes when due to the appropriate
taxing authority or fails to remit to the Sterling Administrative Agent the required receipts or
other required documentary evidence, such Sterling Subsidiary Borrower shall indemnify the Sterling
Administrative Agent and the Sterling Lenders for any incremental taxes, interest or penalties that
may become payable by the Sterling Administrative Agent or any Sterling Lender as a result of any
such failure. The agreements in this subsection shall survive the termination of this Annex B and
the payment of the Sterling Loans and all other amounts payable hereunder.

          2.20.   Use of Proceeds. The Sterling Facility and the proceeds of the Sterling Loans
shall be used by the Sterling Subsidiary Borrowers for working capital and other general corporate
purposes (which shall include any purpose expressly permitted by the Credit Agreement) of the
Sterling Subsidiary Borrowers; provided that, notwithstanding the foregoing, none of the
proceeds of the Sterling Loans may be used to finance any Hostile Take-Over Bid.

          2.21.   Controls on Prepayment if Aggregate Revolving Extensions of Credit Exceed
Aggregate Revolving Credit Commitments. (a) The Sterling Subsidiary Borrowers will implement
and maintain internal controls to monitor the borrowings and repayments of Sterling Loans by the
relevant Sterling Subsidiary Borrowers and the issuance of and drawings under Sterling Letters of
Credit, with the object of preventing any request for an Extension of Credit that would result in
the Available Sterling

 

16

Commitments becoming negative by more than 5% of the Sterling Commitments,
if such Commitments are negative by more than 5%, the Sterling Subsidiary Borrowers will promptly
notify the Sterling Administrative Agent.

          (b)   The Sterling Administrative Agent will calculate the Available Sterling Commitments from
time to time, and in any event not less frequently than once during each calendar quarter. In
making such calculations, the Sterling Administrative Agent will rely on the information most
recently received by it from the Sterling Swing Line Lender in respect of outstanding Sterling
Swing Line Loans and from the Sterling Issuing Lender in respect of outstanding Sterling L/C
Obligations.

          (c)   In the event that on any date the Sterling Administrative Agent calculates that (i) the
Available Sterling Commitments have become negative solely as a result of a change in the aggregate
Dollar Equivalent of the Sterling Loans by more than 5%, the Sterling Administrative Agent will
give notice to such effect to the relevant Sterling Subsidiary Borrowers and the Sterling Lenders.
Within five Business Days (U.K.) of receipt of any such notice, such Sterling Subsidiary Borrower
will, as soon as practicable but in any event within five Business Days (U.K.) of receipt of such
notice, first, make such repayments or prepayments of Sterling Loans (together with
interest accrued to the date of such repayment or prepayment), second, pay any
Reimbursement Obligations under the Sterling Facility then
outstanding and third, cash collateralize any outstanding Sterling L/C Obligations on
terms reasonably satisfactory to the Sterling Administrative Agent as shall be necessary to cause
the Available Sterling Commitments not to be negative.

          2.22.   Lending Installations. (a) Subject to subsection 2.4 of the Credit Agreement
and subsections 2.1 and 2.3 of this Annex B, each Sterling Lender may book its Sterling Loans at
any Lending Installation selected by such Sterling Lender and may change its Lending Installation
from time to time. All terms of the Credit Agreement shall apply to any such Lending Installation
and the Sterling Loans made hereunder shall be deemed held by each Sterling Lender for the benefit
of such Lending Installation. Each Sterling Lender may, by written notice to the Sterling
Administrative Agent and the Sterling Subsidiary Borrowers in accordance with subsection 10.2 of
the Credit Agreement and subject always to subsection 2.4 of the Credit Agreement and subsections
2.13 and 2.3 of this Annex B designate replacement or additional Lending Installations through
which Sterling Loans will be made by it and for whose account Sterling Loan payments are to be
made.

          (b)   Each Sterling Lender agrees that, upon the occurrence of any event giving rise to the
operation of subsection 2.17 or 2.19 with respect to such Sterling Lender, it will, if requested by
the Sterling Subsidiary Borrower, use reasonable efforts (subject to overall policy considerations
of such Sterling Lender) to designate another Lending Installation for any Sterling Loans affected
by such event with the object of avoiding the consequences of such event; provided, that
such designation is made on terms that, in the sole judgment of such Sterling Lender, cause such
Sterling Lender and any of its Lending Installations to suffer no economic, legal or regulatory
disadvantage, and provided, further, that nothing in this subsection 2.22(b) shall
affect or postpone any of the obligations of the Sterling Subsidiary Borrowers or the rights of any
Sterling Lender pursuant to subsection 2.17 or 2.19.

          2.23.   Notices to Lenders. All notices under this Section 2 to Sterling Lenders by
the Sterling Subsidiary Borrowers or the Sterling Administrative Agent, and all payments by the
Sterling Administrative Agent to the Sterling Lenders, shall be made to the respective Lending
Installations of the Sterling Lenders maintaining the relevant Sterling Loans or Sterling
Commitments.

 

 

17

SECTION 3. LETTER OF CREDIT FACILITIES

     3.1. Sterling L/C Commitment. (a) Subject to the terms and conditions hereof, the Sterling Issuing Lender, in reliance
on the agreements of the other Lenders set forth in subsection 3.4(a), agrees to issue letters of
credit (“Sterling Letters of Credit”) under the Sterling Commitments for the account of any
Sterling Subsidiary Borrower on any Business Day (U.K.) during the Revolving Credit Commitment
Period in such form as may be approved from time to time by the Sterling Issuing Lender;
provided that the Sterling Issuing Lender shall not have any obligation to issue any
Sterling Letter of Credit if, after giving effect to such issuance, (i) the Sterling L/C
Obligations would exceed the Sterling L/C Commitment or (ii) the Available Sterling Commitments
would be negative. Each Sterling Letter of Credit shall (i) be denominated in Sterling, (ii) be
either (x) a standby letter of credit (a “Sterling Standby L/C”) issued to support
obligations of any Sterling Subsidiary Borrower, contingent or otherwise, with an expiry date
occurring not later than one year after such standby Sterling L/C was issued (which expiry date may
be subject to one or more automatic extensions of one year or less unless 60-day notice, or such
other notice as is satisfactory to the relevant Sterling Subsidiary Borrower and the Sterling
Issuing Lender, is given that any such extension shall not be effective) or (y) a documentary
letter of credit in respect of the purchase of goods or services by any Sterling Subsidiary
Borrower in the ordinary course of business with an expiry date occurring not later than one year
after such documentary letter of credit was issued and, in the case of any such documentary letter
of credit which is to be accepted by the Sterling Issuing Lender pending payment at a date after
presentation of sight drafts, with a payment date no more than one year after such drafts were
presented for acceptance (a “Sterling Trade L/C”) and (iii) expire no later than five days
before the Revolving Credit Termination Date.

     (b) Each Sterling Standby L/C shall be subject to the International Standby Practices and
each Sterling Trade L/C shall be subject to the Uniform Customs and, in each case, to the extent
not inconsistent therewith, the laws of the State of New York.

     (c) The Sterling Issuing Lender shall at no time be obligated to issue any Sterling Letter of
Credit hereunder if such issuance would conflict with, or cause the Sterling Issuing Lender or any
Sterling L/C Participant to exceed any limits imposed by, any applicable Requirement of Law.

     3.2. Procedure for Issuance of Letters of Credit. Any Sterling Subsidiary Borrower may from time to time request that the Sterling Issuing
Lender issue a Sterling Letter of Credit by delivering to the Sterling Issuing Lender (with a copy
to the Sterling Administrative Agent) at its address for notices specified herein an Application
therefor, completed to the satisfaction of the Sterling Issuing Lender, and such other
certificates, documents and other papers and information as the Sterling Issuing Lender may
reasonably request. Upon receipt of any Application, the Sterling Issuing Lender will process such
Application and the certificates, documents and other papers and information delivered to it in
connection therewith in accordance with its customary procedures and shall promptly issue the
Sterling Letter of Credit requested thereby (but in no event shall the Sterling Issuing Lender be
required to issue any Sterling Letter of Credit earlier than four Business Days (U.K.) after its
receipt of the Application therefor and all such other certificates, documents and other papers and
information relating thereto) by issuing the original of such Sterling Letter of Credit to the
beneficiary thereof or as otherwise may be agreed by the Sterling Issuing Lender and any relevant
Sterling Subsidiary Borrower. The Sterling Issuing Lender shall furnish a copy of such Sterling
Letter of Credit to the relevant Sterling Subsidiary Borrower, to the Sterling Administrative Agent
promptly following the issuance thereof.

     3.3. Fees, Commissions and Other Charges. (a) The relevant Sterling Subsidiary Borrower shall pay to the Sterling Administrative
Agent, for the ratable account of the Sterling Issuing Lender and the Sterling L/C Participants, a
letter of credit commission in Sterling with respect to each Sterling Trade L/C issued by the
Sterling Issuing Lender (i) in an amount equal to the Dollar Equivalent

 

18

of such issuance and
payment fees as have been agreed upon by the relevant Sterling Subsidiary Borrower and the Sterling
Issuing Lender and (ii) in an amount equal to the product of, on the date on which such commission
is calculated, (A) the rate per annum equal to the Applicable Margin in respect of LIBOR Loans and
(B) the Dollar Equivalent of the aggregate amount available to be drawn under each Sterling Letter
of Credit (plus an additional 1/4 of 1% per annum which shall be payable for the account of the
Sterling Issuing Lender). Such letter of credit commissions shall be payable in arrears on the
last day of each March, June, September and December and shall be nonrefundable.

     (b) The relevant Sterling Subsidiary Borrower shall pay to the Sterling Administrative Agent,
for the ratable account of the Sterling Issuing Lender and the Sterling L/C Participants, a letter
of credit commission in Sterling with respect to each Sterling Standby L/C issued by the Sterling
Issuing Lender, computed for the period from the date of such payment to the date upon which the
next such payment is due hereunder in an amount equal to the product of (i) the rate equal to the
Applicable Margin in respect of LIBOR in effect on the date on which such commission is calculated
and (ii) the Sterling Equivalent of the aggregate amount available to be drawn under such Sterling
Standby L/C on the date on which such commission is calculated (plus an additional 1/4 of 1% per
annum which shall be payable for the account of the Sterling Issuing Lender). The relevant
Sterling Subsidiary Borrower shall also pay to the Sterling Administrative Agent, for the account
of the Sterling Issuing Lender, such issuance fees as have been agreed upon by the relevant
Sterling Subsidiary Borrower and the Sterling Issuing Lender. Such letter of credit commissions
shall be payable in arrears on the last day of each March, June, September and December and shall
be nonrefundable.

     (c) In addition to the foregoing fees and commissions, the relevant Sterling Subsidiary
Borrower shall pay or reimburse the Sterling Issuing Lender for such normal and customary costs and
expenses as are incurred or charged by the Sterling Issuing Lender in issuing, effecting payment
under, amending or otherwise administering any Sterling Letter of Credit issued by it.

     (d) The Sterling Administrative Agent shall, promptly following its receipt thereof,
distribute to the Sterling Issuing Lender and the Sterling L/C Participants all fees and
commissions received by the Sterling Administrative Agent for their respective accounts pursuant to
this subsection 3.3.

     3.4. Sterling L/C Participation. (a) The Sterling Issuing Lender irrevocably agrees to grant and hereby grants to each
Sterling L/C Participant, and, to induce the Sterling Issuing Lender to issue Sterling Letters of
Credit hereunder, each such Sterling L/C Participant irrevocably agrees to accept and purchase and
hereby accepts and purchases from the Sterling Issuing Lender, on the terms and conditions
hereinafter stated, for such Sterling L/C Participant’s own account and risk an undivided interest
equal to such Sterling L/C Participant’s ratable share of the Sterling Facility in the Sterling
Issuing Lender’s obligations and rights under each Sterling Letter of Credit issued hereunder and
the amount of each draft paid by the Sterling Issuing Lender thereunder. Each such Sterling L/C
Participant unconditionally and irrevocably agrees with the Sterling Issuing Lender that, if a
draft is paid under any such Sterling Letter of Credit for which the Sterling Issuing Lender is not
reimbursed in full by the relevant Sterling Subsidiary Borrower in accordance with the terms of the
Credit Agreement (including this Annex B), such Sterling L/C
Participant shall pay to the Sterling Issuing Lender upon demand at the Sterling Issuing
Lender’s address for notices specified herein an amount equal to such Sterling L/C Participant’s
ratable share of the Sterling Facility of the amount of such draft, or any part thereof, which is
not so reimbursed.

     (b) If any amount required to be paid by any Sterling L/C Participant to the Sterling Issuing
Lender pursuant to subsection 3.4(a) in respect of any unreimbursed portion of any payment made by
the Sterling Issuing Lender under any Sterling Letter of Credit is not paid to the Sterling Issuing

 

19

Lender within three Business Days (U.K.) after the date such payment is due, such Sterling L/C
Participant shall pay to the Sterling Issuing Lender on demand an amount equal to the product of
(i) such amount, times (ii) the customary rate as selected by the Sterling Issuing Lender
for the settlement of obligations between banks during the period from and including the date such
payment is required to the date on which such payment is immediately available to the Sterling
Issuing Lender, times (iii) a fraction the numerator of which is the number of days that
elapse during such period and the denominator of which is 360. If any such amount required to be
paid by any such Sterling L/C Participant pursuant to subsection 3.4(a) is not in fact made
available to the Sterling Issuing Lender by such Sterling L/C Participant within three Business
Days (U.K.) after the date such payment is due, the Sterling Issuing Lender shall be entitled to
recover from such Sterling L/C Participant, on demand, such amount with interest thereon calculated
from such due date at the rate per annum applicable to LIBOR hereunder. A certificate of the
Sterling Issuing Lender submitted to any Sterling L/C Participant with respect to any amounts owing
under this subsection shall be conclusive in the absence of manifest error.

     (c) Whenever, at any time after the Sterling Issuing Lender has made payment under any
Sterling Letter of Credit and has received from any Sterling L/C Participant its ratable share of
such payment in accordance with subsection 3.4(a), the Sterling Issuing Lender receives any payment
related to such Sterling Letter of Credit (whether directly from the relevant Sterling Subsidiary
Borrower or otherwise), or any payment of interest on account thereof, the Sterling Issuing Lender
will distribute to such Sterling L/C Participant its ratable share thereof; provided,
however, that in the event that any such payment received by the Sterling Issuing Lender
shall be required to be returned by the Sterling Issuing Lender, such Sterling L/C Participant
shall return to the Sterling Issuing Lender the portion thereof previously distributed by the
Sterling Issuing Lender to it.

     3.5. Reimbursement Obligation of the Sterling Subsidiary Borrowers. The relevant Sterling Subsidiary Borrower agrees to reimburse the Sterling Issuing Lender
on each date on which the Sterling Issuing Lender notifies such Sterling Subsidiary Borrower of the
date and amount of a draft presented under any Sterling Letter of Credit and paid by the Sterling
Issuing Lender for the amount of (a) such draft so paid and (b) any taxes (other than Excluded
Taxes), fees, charges or other costs or expenses incurred by the Sterling Issuing Lender in
connection with such payment; provided that upon the acceleration of such reimbursement
obligations in accordance with Section 8 of the Credit Agreement, the relevant Sterling Subsidiary
Borrower agrees to reimburse the Sterling Issuing Lender for the amount equal to then maximum
liability (whether direct or contingent) of the Sterling Issuing Lender and the Sterling L/C
Participants under such Sterling Letter of Credit. Each such payment shall be made to the Sterling
Issuing Lender, at its address for notices specified herein in Sterling and in immediately
available funds, on the date on which the relevant Sterling Subsidiary Borrower receives such
notice, if received prior to 10:00 A.M., London time, on a Business Day (U.K.) and otherwise on the
next succeeding Business Day (U.K.).

     3.6. Obligations Absolute. Any relevant Sterling Subsidiary Borrower’s obligations under this Section 3 shall be
absolute and unconditional under any and all circumstances and irrespective of any set-off,
counterclaim
or defense to payment which any relevant Sterling Subsidiary Borrower may have or have had
against the Sterling Issuing Lender or any beneficiary of a Sterling Letter of Credit. Each
Sterling Subsidiary Borrower also agrees with the Sterling Issuing Lender that the Sterling Issuing
Lender shall not be responsible for, such relevant Sterling Subsidiary Borrower’s Reimbursement
Obligations under subsection 3.5 shall not be affected by, among other things, the validity or
genuineness of documents or of any endorsements thereon, even though such documents shall in fact
prove to be invalid, fraudulent or forged, or any dispute between or among any relevant Sterling
Subsidiary Borrower and any beneficiary of any Sterling Letter of Credit or any other party to
which such Sterling Letter of Credit may be transferred or any claims whatsoever of the relevant
Sterling Subsidiary Borrower against any beneficiary of such Sterling Letter of Credit or any such
transferee. The Sterling Issuing Lender shall

 

20

not be liable for any error, omission, interruption
or delay in transmission, dispatch or delivery of any message or advice, however transmitted, in
connection with any Sterling Letter of Credit issued by it, except for errors or omissions caused
by the Sterling Issuing Lender’s gross negligence or willful misconduct. Each Sterling Subsidiary
Borrower agrees that any action taken or omitted by the Sterling Issuing Lender under or in
connection with any Sterling Letter of Credit issued by it or the related drafts or documents, if
done in the absence of gross negligence or willful misconduct and in accordance with the standards
of care specified in the Uniform Commercial Code of the State of New York, shall be binding on the
relevant Sterling Subsidiary Borrower and shall not result in any liability of the Sterling Issuing
Lender to any relevant Sterling Subsidiary Borrower.

     3.7. Increased Costs. If the adoption of or any change in any law or regulation or in the interpretation thereof
after the date hereof by any court or administrative or Governmental Authority charged with the
administration thereof shall either (i) impose, modify or deem applicable any reserve, special
deposit or similar requirement against Sterling Letters of Credit issued by the Sterling Issuing
Lender or participated in by the Lenders or (ii) impose on any Sterling Lender any other condition
regarding any Sterling Letter of Credit, and the result of any event referred to in clauses (i) or
(ii) above shall be to increase the cost to the Sterling Issuing Lender or any Sterling Lender of
issuing or maintaining such Sterling Letter of Credit (or its participation therein, as the case
may be) (which increase in cost shall be the result of the Sterling Issuing Lender’s or such
Lender’s reasonable allocation of the aggregate of such cost increases resulting from such events),
then, upon notice to it from the Sterling Issuing Lender or such Lender (with a copy to the
Sterling Administrative Agent) certifying that (x) one of the events herein above described has
occurred and the nature of such event, (y) the increased cost or reduced amount resulting from such
event and (z) the additional amounts demanded by the Sterling Issuing Lender or such Lender, as the
case may be, and a reasonably detailed explanation of the calculation thereof, the relevant
Sterling Subsidiary Borrower shall immediately pay to such Sterling Issuing Lender or such Lender,
as the case may be, from time to time as specified by the Sterling Administrative Agent or such
Sterling Lender, additional amounts which shall be sufficient to compensate such Sterling Issuing
Lender or such Sterling Lender for such increased cost, together with interest on each such amount
from the date demanded until payment in full thereof at the rate provided in subsection 3.3. A
certificate as to the fact and amount of such increased cost incurred by the Sterling Issuing
Lender or such Sterling Lender as a result of any event mentioned in clauses (i) or (ii) above,
submitted by the Sterling Issuing Lender or such Lender to such Sterling Subsidiary Borrower, shall
be conclusive, absent manifest error.

     3.8. Sterling Letter of Credit Payments. If any draft in Sterling shall be presented for payment under any Sterling Letter of
Credit, the Sterling Issuing Lender shall promptly notify the relevant Sterling Subsidiary Borrower
and the Sterling Administrative Agent of the date and amount of the Sterling thereof. The
responsibility of the Sterling Issuing Lender to the Sterling Subsidiary Borrowers in connection
with any draft presented
for payment under any Sterling Letter of Credit shall, in addition to any payment obligation
expressly provided for in such Sterling Letter of Credit, be limited to determining that the
documents (including each draft) delivered under such Sterling Letter of Credit in connection with
such presentment are in conformity with such Sterling Letter of Credit.

     (a) Application. To the extent that any provision of any Application related to any Sterling Letter of
Credit is inconsistent with the provisions of the Credit Agreement, the provisions of the Credit
Agreement shall apply.

     (b) Purpose of the Letters of Credit. The Sterling Letters of Credit shall be used for any lawful purposes requested by the
Sterling Subsidiary Borrowers.

 

 

APPENDIX I

PRICING GRID FOR STERLING LOANS

PRICING GRID

	 	 	 	 	 	 	 	 	 
	 	 	Applicable
	 	 	Margin
	Leverage	 	 	 	 	 	Reference
	Ratio	 	LIBOR	 	Rate
	> 4.00 to 1.00
	 	 	1.500	%	 	 	0.500	%
	> 3.00 to 1.00
	 	 	1.250	%	 	 	0.250	%
	> 2.25 to 1.00
	 	 	1.000	%	 	 	0.000	%
	> 1.75 to 1.00
	 	 	0.875	%	 	 	0.000	%
	> 1.25 to 1.00
	 	 	0.750	%	 	 	0.000	%
	< 1.25 to 1.00
	 	 	0.625	%	 	 	0.000	%

Changes in the Applicable Margin resulting from changes in the Leverage Ratio shall become
effective on the date (the “Adjustment Date”) on which financial statements are delivered to the
Lenders pursuant to subsection 6.1 (but in any event not later than the 45th day after
the end of each of the first three quarterly periods of each fiscal year of the Borrower or the
90th day after the end of each fiscal year of the Borrower, as the case may be) and
shall remain in effect until the next change to be effected pursuant to this paragraph. If any
financial statements referred to above are not delivered within the time periods specified above,
then, until such financial statements are delivered, the Leverage Ratio as at the end of the fiscal
period that would have been covered thereby shall for the purposes of this definition be deemed to
be greater than or equal to 3.25 to 1.00. In addition, at all times while an Event of Default
shall have occurred and be continuing, the Leverage Ratio shall for the purposes of this definition
be deemed to be greater than 3.25 to 1.00. Each determination of the Leverage Ratio pursuant to
this pricing grid shall be made with respect to (or, in the case of Average Total Indebtedness, as
at the end of) the period of four consecutive fiscal quarters of the Borrower ending at the end of
the period covered by the relevant financial statements.

 

ANNEX C

SECTION 1. DEFINITIONS

          Defined Terms. Unless otherwise defined herein, terms defined in the Amended and
Restated Credit Agreement, dated as of February 7, 2007 (as amended, restated supplemented or
otherwise modified from time to time, the “Credit Agreement”) to which this Annex C is
attached and used herein shall have the meanings given to them in the Credit Agreement, and the
following terms shall have the following meanings:

     “Administrative Questionnaire” shall mean the administrative questionnaire of
each Lender referred to in subsection 10.6 of the Credit Agreement.

     “Aggregate Australian Revolving Extensions of Credit” shall mean an amount
equal to the sum of (a) the aggregate principal amount of all Australian Dollar Loans
(including, without limitation, Australian Dollar Swing Line Loans borrowed under Australian
Commitments) then outstanding and (b) the aggregate amount of all Australian L/C Obligations
then outstanding.

     “Aggregate Facility C Revolving Extensions of Credit” shall mean an amount
equal to the sum of (a) the aggregate principal amount of all Facility C Loans (including,
without limitation, Australian Dollar Swing Line Loans borrowed under Facility C
Commitments) then outstanding and (b) the aggregate amount of all Australian L/C Obligations
then outstanding in respect of Letters of Credit issued under the Facility C Commitments.

     “Applicable Margin for Australian Borrowing” shall mean the rate per annum set
forth in the pricing grid attached as Appendix I hereto.

     “Application” shall mean an application, in such form as the Australian Issuing
Lender may specify from time to time, requesting such Australian Issuing Lender to open an
Australian Letter of Credit.

     “Australian Dollars” or “A$” shall mean the lawful currency of the
Commonwealth of Australia.

     “Australian Administrative Agent” shall mean J.P. Morgan Australia Limited,
together with its affiliates, as the agent for the Australian Dollar Lenders under the
Credit Agreement.

     “Australian Administrative Office” shall mean the Australian Administrative
Agent’s office located at Level 32, Grosvenor Place, 225 George Street, Sydney NSW 2000
Australia, telecopy: +61-(2)-9247-7698, attention: Yvonne Blunt/Jason M. Lock/Graham
McKinley, Agency, or such other office in Australia as may be designated as such by the
Australian Administrative Agent by written notice to the Australian Subsidiary Borrowers and
the Australian Dollar Lenders.

     “Australian Commitment” shall mean, as to any Australian Dollar Lender, the
obligation of such Australian Dollar Lender to make Australian Dollar Loans and participate
in Australian Dollar Swing Line Loans or Australian Letters of Credit hereunder in an
aggregate principal or face amount at any one time outstanding up to but not exceeding the
amount set forth opposite such Australian Dollar Lender’s name on Schedule 1 to the Credit
Agreement under the caption “Australian Commitment” or in the Assignment and Acceptance
pursuant to which such Australian Dollar Lender became party to the Credit Agreement, as the
same may be changed

 

2

from time to time pursuant to the terms hereof. The original aggregate
principal amount of the Australian Commitments is the Australian Dollar equivalent of
U.S.$25,000,000.

     “Australian Commitment Percentage” shall mean as to any Australian Dollar
Lender at any time, the percentage of the aggregate Australian Commitments then constituted
by such Australian Dollar Lender’s Australian Commitment.

     “Australian Dollar Lender” shall mean each Lender that has an Australian
Commitment or that holds Australian Dollar Loans; collectively, the “Australian Dollar
Lenders”. Each Australian Dollar Lender on the date hereof and on each date on which a
payment or prepayment of interest is made represents that it is an Eligible Australian Bank.

     “Australian Dollar Loan” shall mean any Loan made under the Australian
Commitments pursuant to subsection 2.1; collectively, the “Australian Dollar Loans”.

     “Australian Dollar Swing Line Commitment” shall mean the obligation of the
Australian Dollar Swing Line Lender, at any date, to make an Australian Dollar Swing Line
Loan pursuant to subsection 2.3(a) in the amount referred to therein.

     “Australian Dollar Swing Line Lender” shall mean JPMorgan Chase Bank, N.A.,
Sydney Branch, and such other Lenders or Affiliates thereof as may be designated in writing
by the Australian Subsidiary Borrowers which agree in writing to act as such in accordance
with the terms hereof and are reasonably acceptable to the Australian Administrative Agent.

     “Australian Dollar Swing Line Loan” shall mean any Australian Dollar Swing Line
Loan made pursuant to subsection 2.3 hereof.

     “Australian Facility” shall mean the Australian Commitments together with the
Aggregate Australian Revolving Extensions of Credit.

     “Australian Issuing Lender” shall mean JPMorgan Chase Bank, N.A., Sydney
Branch.

     “Australian L/C Commitment” shall mean the Australian Dollar equivalent of
U.S.$25,000,000.

     “Australian L/C Obligations” shall mean, at any time, an amount equal to the
sum of (a) the aggregate then undrawn and unexpired amount of then outstanding Australian
Letters of Credit and (b) the aggregate amount of drawings under Australian Letters of
Credit which have not then been reimbursed pursuant to Section 3.

     “Australian L/C Participants” shall mean the collective reference to all the
Australian Dollar Lenders other than the Australian Issuing Lender.

     “Australian Lending Office” shall mean for each Australian Dollar Lender, the
lending office for such Australian Dollar Lender (or of an affiliate of such Australian
Dollar Lender) designated for each type of Australian Dollar Loan in the Administrative
Questionnaire of such Australian Dollar Lender or such other lending office of such
Australian Dollar Lender (or of an affiliate of such Australian Dollar Lender) as such
Australian Dollar Lender may from time to time specify to the Australian Administrative
Agent and the Australian Subsidiary Borrowers as the office by which its Australian Dollar
Loans of such type are to be made and maintained.

 

3

     “Australian Letter of Credit” shall mean any Australian Standby L/C or
Australian Trade L/C, as each term is defined in subsection 3.1.

     “Available Australian Commitment” shall mean, as to any Lender at any time, the
amount equal to the excess, if any, of (a) such Lender’s Australian Commitment over
(b) the sum of such Lender’s (i) ratable portion of the Aggregate Facility C Revolving
Extensions of Credit and (ii) ratable portion of the Aggregate Australian Revolving
Extensions of Credit. The Available Australian Commitment may be calculated as being
negative at any time.

     “BBR Loans” shall mean the Loans hereunder at such time as they are made and/or
being maintained at a rate of interest based upon the applicable Bank Bill Rate.

     “Bank Bill Rate” shall mean, for an Interest Period, the average bid rate for
Bills having a tenor closest to the Interest Period as displayed on the “BBSY” page of the
Reuters Monitor System on the first day of that Interest Period. However, if the average
bid rate is not displayed by 10:30 a.m. Sydney time on that day, or if it is displayed but
there is an obvious error in that rate, “Bank Bill Rate” shall mean the rate set by the
Australian Administrative Agent in good faith at approximately 10:30 a.m. Sydney time on
that day, having regard, to the extent possible, to the rates otherwise bid for Bills of
that tenor at or around that time (including any displayed on the “BBSW” page of the Reuters
Monitor System).

     “Bill” shall have the meaning given such term in the Bills of Exchange Act 1909
(Cwlth) and a reference to the drawing, acceptance or endorsement of, or other dealing with,
a Bill is to be interpreted in accordance with that Act.

     “Borrowing Date (Australia)” shall mean any Business Day (Australia) specified
in a notice as a date on which an Australian Subsidiary Borrower requests the relevant
Australian Dollar Lenders to make Australian Dollar Loans under this Annex C to the Credit
Agreement.

     “Business Day (Australia)” shall mean a day on which banks are open for
business in Sydney but excludes Saturday, Sunday and any other day which is a public holiday
in Sydney.

     “Dollar Equivalent (Australia)” shall mean, on any Business Day (Australia)
with respect to any amount denominated in Australian Dollars, the amount of U.S. Dollars
that would be required to purchase such amount of Australian Dollars based upon the spot
selling rate at which JPMorgan Chase Bank offers to sell Australian Dollars for U.S. Dollars
in the Sydney foreign exchange market at approximately 11:00 A.M. Sydney time on such
Business Day (Australia) for delivery two Business Days (Australia) later.

     “Eligible Australian Bank” shall mean (a) a resident of Australia which does
not make Australian Dollar Loans as part of carrying on business outside of Australia at or
through a permanent establishment outside of Australia; or (b) a non-resident of Australia
which makes Swing Line Loans or Revolving Credit Loans as part of carrying on business in
Australia at or through a permanent establishment of the non-resident in Australia. In this
definition, words and expressions used shall have the meaning ascribed to them for the
purposes of S. 128B of the Australian Income Tax Assessment Act of 1936.

     “Interest Payment Date” shall mean (i) for an Interest Period of 3 months or
less, the last day of that Interest Period or (ii) for an Interest Period which is greater
than 3 months, the last day of each 3 month period (or the next following Business Day
(Australia) if such day is not a Business Day (Australia)) within that Interest Period and
the last day of, that Interest Period.

 

4

     “Interest Period” shall mean with respect to any Australian Dollar Loan, (i)
initially, the period commencing on the date on which such Australian Dollar Loan is made
and ending one, two, three or six months or such other period as agreed by the Australian
Administrative Agent thereafter, as selected by the relevant Australian Subsidiary Borrower
in its irrevocable written notice of borrowing as provided in subsection 2.2 and (ii)
thereafter, each period commencing on the last day of the next preceding Interest Period
applicable to such Australian Dollar Loan and ending one, two, three or six months
thereafter, as selected by the relevant Australian Subsidiary Borrower by irrevocable
written notice to the Australian Administrative Agent not less than three Business Days
(Australia) prior to the last day of then current Interest Period with respect to such
Australian Dollar Loan; provided that all of the foregoing provisions relating to
Interest Periods are subject to the following:

     1. if any Interest Period would otherwise end on a day which is not a Business
Day (Australia), that Interest Period shall be extended to the next succeeding
Business Day (Australia) unless the result of such extension would be to carry such
Interest Period into another calendar month in which event such Interest Period
shall end on the next preceding Business Day (Australia);

     2. if the relevant Australian Subsidiary Borrower shall fail to give notice as
provided in clause (ii) in this definition, the relevant Australian Subsidiary
Borrower shall be deemed to have requested continuation of the affected Australian
Dollar Loan as provided in subsection 2.11;

     3. any Interest Period that would otherwise extend beyond the Revolving Credit
Termination Date shall end on the Revolving Credit Termination Date; and

     4. any Interest Period pertaining to an Australian Dollar Loan that begins on
the last Business Day (Australia) of a calendar month (or on a day for which there
is no numerically corresponding day in the calendar month at the end of such
Interest Period) shall end on the last Business Day (Australia) of a calendar month.

     “Overnight Rate” shall mean, with respect to any day:

     (1) the Reserve Bank of Australia Official Cash Rate (expressed as a
percentage yield per annum rounded up to the nearest two decimal places) published
at or about 10:00 a.m. Sydney time on the Reuters Monitor System screen under the
heading “RBA” or, at the discretion of the Swing Line Lender or Australian Dollar
Lender making Australian Dollar Loans to any Australian Subsidiary Borrower, the
bank bill swap rate (expressed as a percentage yield per annum rounded up to the
nearest two decimal places) published at or about 10:00 a.m. Sydney time;

     (2) if the rate under clause (1) is not published at the relevant time, the
rate (expressed as a percentage yield per annum) determined by the Australian
Administrative Agent to be the prevailing buying rate for Australian Dollar cash
deposits.

     “Post-Default Rate” shall mean a rate equal to the sum or 2% plus the
rate of interest otherwise applicable to such Australian Dollar Loan.

     “Requirement of Law” shall mean, as to any Person, the Certificate of
Incorporation, constitution or Articles of Incorporation, as the case may be, and Code of
Regulations and/or By-Laws or other organizational or governing documents of such Person,
and any law, treaty,

 

5

rule or regulation, or determination of an arbitrator or a court or
other Governmental Authority, in each case applicable to or binding upon such Person or any
of its property or to which such Person or any of its property is subject.

SECTION 2. THE AUSTRALIAN COMMITMENTS

          2.1. The Australian Commitments. Subject to the terms and conditions hereof, each Australian Dollar Lender severally (but
not jointly) agrees to make Australian Dollar Loans in Australian Dollars to each Australian
Subsidiary Borrower from time to time during the Revolving Credit Commitment Period in an aggregate
principal amount not to exceed the Available Australian Commitment of such Australian Dollar Lender
in accordance with the terms hereof (which for this purpose shall be computed as though the amount
in subclause (b)(i) in the definition thereof is $0); provided that, after giving effect to
the making of such Australian Dollar Loans, the Aggregate Australian Revolving Extensions of Credit
will not exceed the Australian Commitment. During the Revolving Credit Commitment Period the
Australian Subsidiary Borrowers may use the Australian Commitments by borrowing, repaying the
Australian Dollar Loans in whole or in part, and reborrowing, all in accordance with the terms and
conditions hereof. Each Australian Dollar Lender agrees that each of its Lending Installations
listed on Schedule 1 and subsequently agreed from time to time in Australia shall be on the date
hereof or the date of such agreement an Eligible Australian Bank.

          2.2. Procedure for Australian Dollar Loan Borrowing. (a) The Australian Subsidiary Borrowers may borrow under the Australian Facility during
the Revolving Credit Commitment Period on any Business Day (Australia); provided that the
relevant Australian Subsidiary Borrower shall give the Australian Administrative Agent irrevocable
notice three Business Days (Australia) prior to the requested Borrowing Date (Australia) (which
notice must be received by the Australian Administrative Agent prior to 11:00 A.M., Sydney time),
specifying (i) the identity of the Australian Subsidiary Borrower borrowing and the amount to be
borrowed, (ii) the requested Borrowing Date (Australia) and (iii) the length of the Interest Period
for such Australian Dollar Loan. Each borrowing by any Australian Subsidiary Borrower pursuant to
the Australian Commitments shall be in an aggregate principal amount equal to the Australian Dollar
equivalent of U.S.$1,000,000 or a whole multiple of the Australian Dollar equivalent of
U.S.$500,000 in excess thereof.

          (b) Upon receipt of any notice from an Australian Subsidiary Borrower pursuant to this
subsection 2.2, the Australian Administrative Agent shall promptly notify each Australian Dollar
Lender thereof. Each such Australian Dollar Lender will make the amount of its ratable share
(subject to subsection 2.1) of such borrowing available to the Australian Administrative Agent for
the account of such Australian Subsidiary Borrower at the Australian Administrative Office prior to
2:00 P.M., Sydney time, on the Borrowing Date (Australia) requested by the such Australian
Subsidiary Borrower in funds immediately available to the Australian Administrative Agent. Such
borrowing will then be made available to such Australian Subsidiary Borrower by the Australian
Administrative Agent crediting the account of such Australian Subsidiary Borrower on the books of
the Australian Administrative Office with the aggregate of the amounts made available to the
Australian Administrative Agent by such Australian Dollar Lenders.

          2.3. Swing Line Commitments. (a) Subject to the terms and conditions hereof, from time to time prior to the Revolving
Credit Termination Date and to the Australian Subsidiary Borrowers (i) the Australian Dollar Swing
Line Lender severally (but not jointly) agrees to make Australian Dollar Swing Line Loans in
Australian Dollars in an aggregate principal amount not to exceed the Australian Dollar equivalent
of U.S.$15,000,000 at any one time outstanding (each of the foregoing individually, a
“Australian Dollar Swing Line Loan”; collectively the “Australian Dollar Swing Line
Loans”); provided that, after giving effect to the making of such Australian Dollar
Swing Line Loans, the aggregate principal

 

6

amount of Swing Line Loans under any Revolving Facility
at any one time outstanding shall not exceed U.S.$100,000,000 and the Aggregate Australian
Revolving Extensions of Credit shall not exceed the Australian Commitments. All Australian Dollar
Swing Line Loans shall be made on terms agreed upon by the Australian Dollar Swing Line Lender and
the applicable Australian Subsidiary Borrowers. The relevant Australian Subsidiary Borrowers shall
give the Australian Administrative Agent irrevocable notice (which notice must be received by the
Australian Administrative Agent at or prior to 1:00 p.m., Sydney time, on the requested Borrowing
Date (Australia)), specifying the amount of each requested Australian Dollar Swing Line Loan, which
shall be greater than or equal to a minimum amount to be agreed upon by such Australian Subsidiary
Borrowers and the relevant Australian Dollar Swing Line Lender. Upon such notice, the Australian
Administrative Agent shall promptly notify the Australian Dollar Swing Line Lender thereof. The
Australian Dollar Swing Line Lender shall make the amount of each requested Australian Dollar Swing
Line Loan available to the relevant Australian Subsidiary Borrowers in the manner directed by the
Australian Administrative Agent on the requested Borrowing Date (Australia).

          (b) The Australian Dollar Swing Line Lender in its sole and absolute discretion, may, on
behalf of the relevant Australian Subsidiary Borrower (which hereby irrevocably directs the
Australian Dollar Swing Line Lender to act on its behalf), request each Australian Dollar Lender,
including the Australian Dollar Swing Line Lender, with respect to all other Australian Dollar
Swing Line Loans, to make an Australian Dollar Loan, in an amount equal to such Australian Dollar
Lender’s Revolving Percentage under the Australian Facility of the amount of the Australian Dollar
Swing Line Loans (the “Refunded Australian Dollar Swing Line Loans”) outstanding on the
date such notice is given. Unless any of the events described in paragraph (f) of Section 8 of the
Credit Agreement shall have occurred (in which event the procedures of paragraph (c) of this
subsection 2.3 shall apply), each Australian Dollar Lender shall make the proceeds of its
Australian Dollar Loan available to the Australian Administrative Agent for the account of the
Australian Dollar Swing Line Lender, at the office of the Australian Administrative Agent prior to
11:00 a.m. (Sydney time) in funds immediately available on the third Business Day (Australia)
following the date such notice is given. The proceeds of such Australian Dollar Loans shall be
immediately applied to repay the Refunded Australian Dollar Swing Line Loans.

          (c) If, prior to the making of an Australian Dollar Swing Line Loan pursuant to paragraph (b)
of subsection 2.3, one of the events described in paragraph (f) of Section 8 of the Credit
Agreement shall have occurred, each Australian Dollar Lender hereby agrees to and will, on the date
such Australian Dollar Swing Line Loan was to have been made, purchase an undivided participating
interest in each Refunded Australian Dollar Swing Line Loan in an amount equal to its Revolving
Percentage under the Australian Facility of such Refunded Australian Dollar Swing Line Loan. Such
Revolving Credit Lender will immediately transfer to the Australian Administrative Agent for the
account of the Australian Dollar Swing Line Lender, in immediately available funds of the amount of
its participations and, upon its receipt of its ratable share thereof, the Australian Dollar Swing
Line Lender will deliver to such Australian Dollar Lender a Swing Line Loan Participation
Certificate dated the date of receipt of such funds and in such amount.

          (d) Whenever, at any time after the Australian Dollar Swing Line Lender has received from any
Australian Dollar Lender such Australian Dollar Lender’s participating interest in a Refunded
Australian Dollar Swing Line Loan and the Australian Dollar Swing Line Lender receives any payment
on account thereof, the Australian Dollar Swing Line Lender will distribute to such Australian
Dollar Lender through the Australian Administrative Agent its participating interest;
provided, however, that in the event that such payment received by the Australian
Dollar Swing Line Lender is required to be returned, such Australian Dollar Lender will return to
the Australian Dollar Swing Line Lender through the Australian Administrative Agent any portion
thereof previously distributed by the Australian Dollar Swing Line Lender to it.

 

7

          2.4. Participation. Each Australian Dollar Lender’s obligation to purchase participating interests pursuant to
paragraph (c) of subsection 2.3 shall be absolute and unconditional and shall not be affected by
any circumstances, including, without limitation, (a) any set-off, counterclaim, recoupment,
defense or other right which such Australian Dollar Lender may have against the Australian Dollar
Swing Line Lender, any Australian Subsidiary Borrower or any other Person for any reason
whatsoever; (b) the occurrence or continuance of an Event of Default; (c) any adverse change in the
condition (financial or otherwise) of the Borrower or any Australian Subsidiary Borrower; (d) any
breach of the Credit Agreement by the Borrower, any Subsidiary Borrower or any other Revolving
Credit Lender; or (e) any other circumstance, happening or event whatsoever, whether or not similar
to any of the foregoing. Notwithstanding the foregoing, no Australian Dollar Lender shall have any
obligation to purchase participating interests pursuant to paragraph (c) of subsection 2.3 or to
make any Refunded Australian Dollar Swing Line Loans in respect of any Australian Dollar Swing Line
Loan which was made at any time following receipt by the Australian Administrative Agent of a
notice from any Australian Dollar Lender specifying that (x) a Default or Event of Default has
occurred and is continuing and (y) explicitly stating that such Australian Dollar Lender will not
purchase such participating interests or make Refunded Australian Dollar Swing Line Loans with
respect to Australian Dollar Swing Line Loans made after the date of receipt of such notice.

          2.5. Repayment of Australian Dollar Loans; Evidence of Debt. (a) Each Australian Subsidiary Borrower hereby unconditionally promises to pay to the
Australian Administrative Agent for the account of each Australian Dollar Lender (i) then unpaid
principal amount of each Australian Dollar Loan of such Australian Dollar Lender on the Revolving
Credit Termination Date (or such earlier date on which the Loans become due and payable pursuant to
Section 8 of the Credit Agreement) and (ii) then unpaid principal amount of the Australian Dollar
Swing Line Loans of the Australian Dollar Swing Line Lender on the Revolving Credit Termination
Date (or such earlier date on which the Australian Dollar Swing Line Loans become due and payable
pursuant to Section 8 of the Credit Agreement). Each Australian Subsidiary Borrower hereby
unconditionally promises to pay to the Australian Administrative Agent for the account of such
Lender (i) then unpaid principal amount of each Loan to such Subsidiary Borrower on the Revolving
Credit Termination Date (or such earlier date on which the Revolving Credit Loans become due and
payable pursuant to Section 8 of the Credit Agreement) and (ii) then unpaid principal amount of the
Australian Dollar Swing Line Loans to such Subsidiary Borrower of the Australian Dollar Swing Line
Lender on the Revolving Credit Termination Date (or such earlier date on which the Australian
Dollar Swing Line Loans became due and payable pursuant to Section 8 of the Credit Agreement).
Each of the Australian Subsidiary Borrowers hereby further agrees to pay interest on the unpaid
principal amount of the Australian Dollar Loans from time to time outstanding to such Australian
Subsidiary Borrower from the date hereof until payment in full thereof at the rates per annum, and
on the dates, set forth in subsection 2.12.

          (a) Each Australian Dollar Lender shall maintain in accordance with its usual practice an
account or accounts evidencing indebtedness of the Australian Subsidiary Borrowers to such
Australian Dollar Lender resulting from each Australian Dollar Loan of such Australian Dollar
Lender from time to time, including the amounts of principal and interest payable and paid to such
Australian Dollar Lender from time to time under the Credit Agreement.

          (b) The Australian Administrative Agent shall maintain a register (the “Australian
Register”) in respect of the Australian Facility in a manner similar to the Register described
in Section 10.6(b)(iv) of the Credit Agreement, and a subaccount therein for each Australian Dollar
Lender, in which shall be recorded (i) the amount of each Australian Dollar Loan made hereunder and
the type thereof, (ii) the amount of any principal or interest due and payable or to become due and
payable from any Australian Subsidiary Borrower to each Australian Dollar Lender hereunder and
(iii) both the amount of

 

8

any sum received by the Australian Administrative Agent hereunder from any
Australian Subsidiary Borrower and each Australian Dollar Lender’s share thereof.

          (c) The entries made in the Australian Register and the accounts of each Australian Dollar
Lender maintained pursuant to subsection 2.5(b) shall, to the extent permitted by applicable law,
be prima facie evidence of the existence and amounts of the obligations of each
Australian Subsidiary Borrower therein recorded; provided, however, that the
failure of any Australian Dollar Lender or the Australian Administrative Agent to maintain the
Australian Register or any such account, or any error therein, shall not in any manner affect the
obligation of any Australian Subsidiary Borrower to repay (with applicable interest) the Australian
Dollar Loans made to such Australian Subsidiary Borrower by such Australian Dollar Lender in
accordance with the terms of the Credit Agreement.

          2.6. [reserved]

          2.7. Termination or Reduction of the Australian Commitments.

          (a) Optional. The Australian Subsidiary Borrowers shall have the right, upon not
less than five Business Days’ (Australia) written notice to the Australian Administrative Agent, to
terminate the Australian Commitments or, from time to time, reduce the amount of the Australian
Commitments, provided that (i) any such reduction shall be accompanied by prepayment of the
Australian Dollar Loans by the relevant Australian Subsidiary Borrower, together with accrued
interest on the amount so prepaid to the date of such prepayment, to the extent, if any, the
Available Australian Commitments would be negative as a result of such reduction and (ii) any such
termination of the Australian Commitments shall be accompanied by (A) prepayment in full of the
Australian Dollar Loans then outstanding hereunder, (B) cash collateralization of all Australian
L/C Obligations then outstanding in accordance with the provisions of subsection 2.10, and (C)
payment of accrued interest thereon to the date of such prepayment and the payment of any unpaid
fees then accrued hereunder (including, without limitation, in respect of any Australian Letters of
Credit). Upon receipt of such notice, the Australian Administrative Agent shall promptly notify
each Lender thereof. Any such reduction shall be in an amount equal to the Australian Dollar
equivalent of U.S.$500,000 or a whole multiple of the Australian Dollar equivalent of U.S.$250,000
in excess thereof and shall reduce permanently the amount of the Australian Commitments then in
effect.

          (b) Mandatory. The Revolving Credit Commitments shall automatically terminate on the
Revolving Credit Termination Date and all Australian Dollar Loans shall be repaid and to the extent
any Australian Letter of Credit remains outstanding after the Revolving Credit Termination Date,
the relevant Australian Subsidiary Borrower shall cash collateralize such Australian L/C
Obligations (and the fees thereon) in accordance with the provisions of subsection 2.10. The
Revolving Credit Commitments shall also be reduced in accordance with subsection 2.9.

          2.8. Optional Prepayments. Any Australian Subsidiary Borrower may, at any time and from time to time, prepay the
Australian Dollar Loans made to it hereunder, in each case in whole or in part, without premium or
penalty, upon at least three Business Days’ (Australia), in the case of BBR Loans, and on one
Business Day’s (Australia), in the case of Loans bearing interest at the Overnight Rate,
irrevocable notice to the Australian Administrative Agent, specifying the date and amount of
prepayment. If such notice is given, the relevant Australian Subsidiary Borrower shall make such
prepayment and the payment amount specified in such notice shall be due and payable on the date
specified therein, together with accrued interest to such date on the amount prepaid. Partial
prepayments shall be in an aggregate principal amount of the Australian Dollar equivalent of
U.S.$500,000 or a whole multiple of the Australian Dollar equivalent of U.S.$250,000 in excess
thereof.

 

9

          2.9. Mandatory Prepayments. The Australian Subsidiary Borrowers, without notice or demand, shall immediately prepay the
Australian Dollar Loans, to the extent, if any, that the Available Australian Commitments are
negative, together with accrued interest to the date of such prepayment on the amount so prepaid;
provided that if such prepayment is required solely as a result of a change in the
aggregate Dollar Equivalent (Australia) of the Australian Dollar Loans, no prepayment shall be made
unless such prepayment is required pursuant to subsection 2.21.

          2.10. Cash Collateralization of Australian Letters of Credit. To the extent that at any time and from time to time, the Australian L/C Obligations exceed
the amount of the Australian L/C Commitments or the Australian L/C Obligations exceed the
Australian Commitments (whether pursuant to subsections 2.7, 2.8, 2.9 or otherwise), the Australian
Subsidiary Borrowers shall cash collateralize (in a manner reasonably satisfactory to the
Australian Administrative Agent) such portion of the Australian L/C Obligations (and the fees
thereon through the stated expiration date of the Australian Letters of Credit giving rise to such
Australian L/C Obligations) which is in excess of the Australian L/C Commitments or such Australian
Commitments, as applicable.

          2.11.
Continuation Options. (a) Any Australian Dollar Loan may be continued as such upon the expiration of an Interest Period
by compliance by the Australian Subsidiary Borrowers with the notice provisions contained in the
definition of Interest Period, provided that no Australian Dollar Loan may be continued as
such when any Default or Event of Default has occurred and is continuing.

          (b) No continuation of any Australian Dollar Loans shall be made pursuant to this subsection
2.11 if, after giving effect to such continuation the amount of the Available Australian
Commitments would be negative.

          2.12. Interest Rate and Payment Dates.

          (a) Each Australian Dollar Loan shall bear interest for each day during each Interest Period
with respect thereto at a rate per annum equal to the Bank Bill Rate determined for such Interest
Period (or, as applicable, the Overnight Rate), plus the Applicable Margin.

          (b) If all or a portion of (i) the principal amount of any Australian Dollar Loan or any
reimbursement obligation, (ii) any interest payable thereon or (iii) any facility fee, commission
or other amount payable hereunder shall not be paid when due (whether at the stated maturity, by
acceleration or otherwise), such overdue amount shall bear interest at a rate per annum which is
(A) the rate pursuant to paragraph (a) of this subsection plus 2% from the date of such non-payment
until such amount is paid in full (as well after as before judgment). The Australian
Administrative Agent may choose any Interest Period from time to time (including one Interest
Period of shorter than one month) with respect to any overdue amount bearing interest based upon
paragraph (a) of this subsection.

          (c) Interest shall be payable in arrears on each Interest Payment Date, except that interest
payable pursuant to subsection 2.12(b) shall be payable upon demand.

          2.13.
Computation of Interest and Fees. (a) Each determination of an interest rate by the Australian Administrative Agent pursuant to
any provision of this Annex C shall be conclusive and binding on the Australian Subsidiary
Borrowers absent manifest error.

          (b) Interest shall be calculated on the basis of a 365- (366-, as the case may be) day year
for the actual days elapsed. The Australian Administrative Agent shall as soon as practicable
notify the affected Australian Dollar Lenders of each determination of the Bank Bill Rate. Any
change in the interest rate on an Australian Dollar Loan resulting from a change in any reserve
requirements shall

 

10

become effective as of the opening of business on the day on which such change
in reserve requirements becomes effective. The Australian Administrative Agent shall as soon as
practicable notify the affected Australian Dollar Lenders of the Closing Date and the amount of
such change in interest rate.

          (c) The Australian Administrative Agent shall, at the request of the Australian Subsidiary
Borrowers or any Australian Dollar Lender, deliver to the Australian Subsidiary Borrowers or such
Australian Dollar Lender a statement showing in reasonable detail the calculations used by the
Australian Administrative Agent in determining any interest rate pursuant to subsection 2.12,
excluding any Bank Bill Rate which is based upon the “BBSW” page of the Reuters Monitor System.

          2.14.
Inability to Determine Interest Rate. In the event that the Australian Administrative Agent has reasonably determined (which
determination shall be conclusive and binding upon the Australian Subsidiary Borrowers absent
manifest error) that by reason of circumstances affecting the interbank depositary market, adequate
and reasonable means do not exist for ascertaining the Bank Bill Rate applicable pursuant to
subsection 2.12(a) for any Interest Period with respect to (a) a proposed Australian Dollar Loan or
(b) the continuation of an Australian Dollar Loan beyond the expiration of then current Interest
Period with respect thereto, the Australian Administrative Agent shall forthwith give telecopy or
telephonic notice of such determination, confirmed in writing, to the relevant Australian
Subsidiary Borrowers and the Australian Dollar Lenders at least one Business Days (Australia) prior
to, as the case may be, the requested Borrowing Date (Australia) for such Australian Dollar Loan or
the last day of such Interest Period. If such notice is given (i) any requested Australian Dollar
Loan shall bear interest at the Overnight Rate plus the Applicable Margin and (ii) any
outstanding Australian Dollar Loan shall, at the end of such Interest Period, be continued at the
Overnight Rate plus the Applicable Margin. Until such notice has been withdrawn by the
Australian Administrative Agent, no further Bank Bill Rate Australian Dollar Loans shall be made.
Such notice shall be withdrawn by the Australian Administrative Agent when the Australian
Administrative Agent shall reasonably determine that adequate and reasonable means exist for
ascertaining the Bank Bill Rate.

          2.15. Pro Rata Treatment and Payments. Each borrowing under and any reduction of the Australian Commitments shall be made
ratably according to each Australian Dollar Lenders’ share of the Australian Commitments.

          (b) Each payment (including each prepayment) on account of principal of and interest on the
Australian Dollar Loans shall be made ratably according to the respective outstanding principal
amounts of such Loans then held by the Australian Dollar Lenders.

          (c) All payments (including prepayments) to be made by any Australian Subsidiary Borrower
hereunder, whether on account of principal, interest, fees or otherwise, shall be made without set
off or counterclaim and shall be made prior to 12:00 Noon, Sydney time, on the due date thereof to
the Australian Administrative Agent, for the account of the relevant Australian Dollar Lenders, at
the Australian Administrative Office, in Australian Dollars, and in immediately available funds.
The Australian Administrative Agent shall distribute such payments to the relevant Australian
Dollar Lenders promptly upon receipt in like funds as received. If any payment on an Australian
Dollar Loan becomes due and payable on a day other than a Business Day (Australia), the maturity
thereof shall be extended to the next succeeding Business Day (Australia) unless the result of such
extension would be to extend such payment into another calendar month, in which event such payment
shall be made on the immediately preceding Business Day (Australia).

          (d) Unless the Australian Administrative Agent shall have been notified in writing by any
Australian Dollar Lender prior to a Borrowing Date (Australia) that such Australian Dollar Lender
will not make the amount that would constitute its share of the borrowing on such date available to
the

 

11

Australian Administrative Agent, the Australian Administrative Agent may assume that such
Australian Dollar Lender has made such amount available to the Australian Administrative Agent on
such Borrowing Date (Australia), and the Australian Administrative Agent may, in reliance upon such
assumption, make available to the relevant Australian Subsidiary Borrower a corresponding amount.
If such amount is made available to the Australian Administrative Agent on a date after such
Borrowing Date (Australia), such Australian Dollar Lender shall pay to the Australian
Administrative Agent on demand an amount equal to the product of (i) the Overnight Rate during such
period as quoted by the Australian Administrative Agent, times (ii) the amount of such
Australian Dollar Lender’s share of such borrowing, times (iii) a fraction the numerator of
which is the number of days that elapse from and including such Borrowing Date (Australia) to the
date on which such Australian Dollar Lender’s Revolving Percentage of such borrowing shall have
become immediately available to the Australian Administrative Agent and the denominator of which is
360 (the “Effective Interbank Rate”). A certificate of the Australian Administrative Agent
submitted to any Australian Dollar Lender with respect to any amounts owing under this subsection
shall be conclusive in the absence of manifest error. If such amount is so made available, such
payment to the Australian Administrative Agent shall constitute such Australian Dollar Lender’s
Loan on such Borrowing Date (Australia) for all purposes of this Agreement. If such amount is not
so made available to the Australian Administrative Agent, then the Australian Administrative Agent
shall notify the relevant Australian Subsidiary Borrower of such failure and on the fourth Business
Days (Australia) following such Borrowing Date (Australia), such Australian Subsidiary Borrower
shall pay to the Australian Administrative Agent such ratable portion, together with interest
thereon for each day that such Australian Subsidiary Borrower had the use of such ratable portion,
at the Effective Interbank Rate. Nothing contained in this subsection 2.15(d) shall relieve any
Australian Dollar Lender which has failed to make available its ratable portion of any borrowing
hereunder from its obligation to do so in accordance with the terms hereof.

          (e) The failure of any Australian Dollar Lender to make the Australian Dollar Loan to be made
by it on any Borrowing Date (Australia) shall not relieve any other Australian Dollar Lender of its
obligation, if any, hereunder to make its Australian Dollar Loan on such Borrowing Date
(Australia), but no Australian Dollar Lender shall be responsible for the failure of any other
Australian Dollar Lender to make the Australian Dollar Loan to be made by such other Australian
Dollar Lender on such Borrowing Date (Australia).

          2.16. Illegality. Notwithstanding any other provisions herein, if any introduction of or change in any law,
regulation, treaty or directive or in the interpretation or application thereof occurring after the
date hereof shall make it unlawful for any Australian Dollar Lender to make or maintain BBR Loans
as contemplated by this Annex C, (a) such Australian Dollar Lender shall forthwith give telecopy or
telephonic notice of such circumstances, confirmed in writing, to the relevant Australian
Subsidiary Borrower (which notice shall be withdrawn by such Australian Dollar Lender when such
Australian Dollar Lender shall reasonably determine that it shall no longer be illegal for such
Australian Dollar Lender to make or maintain BBR Loans), (b) the commitment of such Australian
Dollar Lender hereunder to make BBR Loans shall forthwith be canceled and (c) such Australian
Dollar Lender’s Australian Dollar Loans then outstanding, if any, shall be converted automatically
to bear interest at the Overnight Rate plus the Applicable Margin on the last day of then
current Interest Period with respect to such BBR Loans or within such earlier period as may be
required by law. Each Australian Subsidiary Borrower hereby agrees promptly to pay the Australian
Administrative Agent for the account of each Australian Dollar Lender, upon demand by the
Australian Administrative Agent, any additional amounts necessary to compensate the Australian
Dollar Lenders for any costs incurred by the Australian Dollar Lenders in making any conversion in
accordance with this subsection 2.16, including, but not limited to, any interest or fees payable
by the Australian Dollar Lenders to lenders of funds obtained by them in order to make or maintain
their BBR Loans hereunder (the Australian Administrative Agent’s notice of such costs, as certified
to such Australian Subsidiary Borrower, to be conclusive, absent manifest error).

 

12

          2.17. Requirements of Law. (a) In the event that any introduction of or change in any law, regulation, treaty or
directive or in the interpretation or application thereof occurring after the date hereof or
compliance by any Australian Dollar Lender with any request or directive (whether or not having the
force of law) from any central bank or other governmental authority, agency or instrumentality:

          (i) shall subject such Australian Dollar Lender to any tax of any kind, whatsoever with
respect to the Credit Agreement, including this Annex C, any Australian Letter of Credit, any
Application, or any Australian Dollar Loan made by it or its obligation to make Australian Dollar
Loans or change the basis of taxation of payments to such Australian Dollar Lender of principal,
facility fee, interest or any other amount payable hereunder (other than Non-Excluded Taxes (as
defined in subsection 2.19) or changes in the rate of tax on the overall net income of such
Australian Dollar Lender)

          (ii) shall impose, modify or hold applicable any reserve, special deposit, compulsory loan or
similar requirement against assets held by, or deposits or other liabilities in or for the account
of, advances or loans by, or other credit extended by, or any other acquisition of funds by, any
office of such Australian Dollar Lender which are not otherwise included in the determination of
the Bank Bill Rate hereunder, or

          (iii) shall impose on such Australian Dollar Lender or the interbank depositary market any
other condition;

and the result of any of the foregoing is to increase the cost to such Australian Dollar Lender
(which increase in cost shall be the result of such Australian Dollar Lender’s reasonable
allocation of the aggregate of such cost increases resulting from such events), of making, renewing
or maintaining Australian Dollar Loans or issuing or participating in Australian Letters of Credit
or to reduce any amount receivable thereunder then, in any such case, the relevant Australian
Subsidiary Borrower shall, upon notice to it from such Australian Dollar Lender (with a copy to the
Administrative Agent) certifying that (x) one of the events described in this subsection 2.17(a)
has occurred and the nature of such event, (y) the increased cost or reduced amount resulting from
such event and (z) the additional amounts demanded by such Australian Dollar Lender and a
reasonably detailed explanation of the calculation thereof, promptly pay to the Australian
Administrative Agent for the account of the relevant Australian Dollar Lender, upon demand by the
Australian Administrative Agent, without duplication, any additional amounts necessary to
compensate such Australian Dollar Lender for such increased cost or reduced amount receivable which
such Australian Dollar Lender deems to be material as determined in good faith by such Australian
Dollar Lender with respect to the Credit Agreement, including this Annex C, or the Australian
Dollar Loans made hereunder.

          (b) In the event that any Australian Dollar Lender shall have determined that any change in
any Requirement of Law regarding capital adequacy or in the interpretation or application thereof
or compliance by such Australian Dollar Lender or any corporation controlling such Australian
Dollar Lender with any request or directive regarding capital adequacy (whether or not having the
force of law) from any Governmental Authority made subsequent to the date hereof does or shall have
the effect of reducing the rate of return on such Australian Dollar Lender’s or such corporation’s
capital as a consequence of its obligations hereunder or under any Letters of Credit to a level
below that which such Australian Dollar Lender or such corporation could have achieved but for such
change or compliance (taking into consideration such Australian Dollar Lender’s or such
corporation’s policies with respect to capital adequacy) by an amount deemed by such Australian
Dollar Lender to be material, then from time to time, within 15 days after submission by such
Australian Dollar Lender to the Australian Subsidiary Borrowers (with a copy to the Australian
Administrative Agent) of a written request therefor certifying that (x) one of the events described
in this subsection 2.17(b) has occurred and the nature of such event,

 

13

(y) the increased cost or
reduced amount resulting from such event and (z) the additional amounts demanded by such Australian
Dollar Lender and a reasonably detailed explanation of the calculation thereof, the Australian
Subsidiary Borrowers shall pay to such Australian Dollar Lender such additional amount or amounts
as will compensate such Australian Dollar Lender for such reduction.

          (c) Such Lender who has submitted a certificate as to additional amounts payable pursuant to
paragraphs (a) and (b) above agrees to use reasonable efforts for a period of 90 days following the
submission of such certificate to make the Australian Dollar Loans available by some other means
(including changing its Lending Installation).

          (d) A certificate as to any additional amounts payable pursuant to paragraphs (a) and (b)
above submitted by any Australian Dollar Lender to an Australian Subsidiary Borrower shall be
conclusive absent manifest error.

          2.18. Indemnity. Each Australian Subsidiary Borrower agrees to indemnify each Australian Dollar Lender and
to hold each Australian Dollar Lender harmless from any loss or expense which such Australian
Dollar Lender may sustain or incur as a consequence of (a) default by such Australian Subsidiary
Borrower in payment of the principal amount of or interest on any Australian Dollar Loans
including, but not limited to, any such loss or expense arising from interest or fees payable by
such Australian Dollar Lender to lenders of funds obtained by them in order to maintain their
Australian Dollar Loans, (b) default by such Australian Subsidiary Borrower in borrowing Australian
Dollar Loans after such Australian Subsidiary Borrower has given a notice in accordance with
subsection 2.2, (c) default by such Australian Subsidiary Borrower in making any prepayment of an
Australian Dollar Loan after such Australian Subsidiary Borrower has given a notice in accordance
with subsection 2.8, and (d) the making of any payment of Australian Dollar Loans on a day which is
not the last day of the applicable Interest Period with respect thereto, including, but not limited
to, any such loss or expense arising from interest or fees payable by the Australian Dollar Lenders
to lenders of funds obtained by them in order to maintain their Australian Dollar Loans hereunder.
This covenant shall survive termination of the Credit Agreement. The obligations of indemnity of
each of the respective Australian Subsidiary Borrowers hereunder are limited only to the loss and
expense described herein arising from or as a result of any act or omission by such Australian
Subsidiary Borrower, and are not, and shall not be deemed to be, the joint and several obligations
of each such Australian Subsidiary Borrower as to any loss or expense arising from or as a result
of any act or omission by the other Australian Subsidiary Borrowers.

          2.19. Taxes. All payments made by the Australian Subsidiary Borrowers in respect of amounts owing
under this Annex C shall be made free and clear of, and without deduction or withholding for or on
account of, any present or future income, stamp or other taxes, levies, imposts, duties, charges,
fees, deductions or withholdings, now or hereafter imposed, levied, collected, withheld or assessed
by any Governmental Authority, excluding gross or net income or gross receipts taxes, ad valorem
taxes, personal property and/or sales taxes and franchise taxes (imposed in lieu of net income
taxes) imposed on the Australian Administrative Agent or any Australian Dollar Lender as a result
of a present or former connection between the Australian Administrative Agent or

 

14

such Australian
Dollar Lender and the jurisdiction of the Governmental Authority imposing such tax or any political
subdivision or taxing authority thereof or therein (other than any such connection arising solely
from the Australian Administrative Agent or such Australian Dollar Lender having executed,
delivered or performed its obligations or received a payment under, or enforced, this Annex C). If
any such non-excluded taxes, levies, imposts, duties, charges, fees deductions or withholdings
(“Non-Excluded Taxes”) are required to be withheld from any amounts payable to the
Australian Administrative Agent or any Australian Dollar Lender hereunder, the amounts so payable
to the Australian Administrative Agent or such Australian Dollar Lender shall be increased to the
extent necessary to yield to the Australian Administrative Agent or such Australian Dollar Lender
(after payment of all Non-Excluded Taxes) interest or any such other amounts payable hereunder at
the rates or in the amounts specified in this Annex C, provided, however, that none
of the Australian Subsidiary Borrowers shall be required to increase any such amounts payable to
the Australian Administrative Agent or any Australian Dollar Lender if such increased amount arises
as a result of the failure of such Australian Dollar Lender or the Australian Administrative Agent
to be an Eligible Australian Bank or as a result of the failure of the Australian Administrative
Agent or such Australian Dollar Lender to provide its tax file number, ABN or similar information
to the Australian Subsidiary Borrowers. The Australian Subsidiary Borrowers shall also indemnify
the Australian Administrative Agent and each Australian Dollar Lender on an after-tax basis for any
additional taxes on net income which the Australian Administrative Agent or such Australian Dollar
Lender, as the case may be, may be obligated to pay as a result of the receipt of additional
amounts under this subsection 2.19. Whenever any Non-Excluded Taxes are payable by any Australian
Subsidiary Borrower, as promptly as possible thereafter but in any event within 45 days after the
date of payment such Australian Subsidiary Borrower shall send to the Australian Administrative
Agent for its own account or for the account of such Australian Dollar Lender, as the case may be,
a certified copy of an original official receipt received by such Australian Subsidiary Borrower
showing payment thereof. If any Australian Subsidiary Borrower fails to pay any Non-Excluded Taxes
when due to the appropriate taxing authority or fails to remit to the Australian Administrative
Agent the required receipts or other required documentary evidence, such Australian Subsidiary
Borrower shall indemnify the Australian Administrative Agent and the Australian Dollar Lenders for
any incremental taxes, interest or penalties that may become payable by the Australian
Administrative Agent or any Australian Dollar Lender as a result of any such failure. The
agreements in this subsection shall survive the termination of this Annex C and the payment of the
Australian Dollar Loans and all other amounts payable hereunder.

          2.20. Use of Proceeds. The Australian Facility and the proceeds of the Australian Dollar Loans shall be used by
the Australian Subsidiary Borrowers for working capital and other general corporate purposes (which
shall include any purpose expressly permitted by the Credit Agreement) of the Australian Subsidiary
Borrowers; provided that, notwithstanding the foregoing, none of the proceeds of the
Australian Dollar Loans may be used to finance any Hostile Take-Over Bid.

          2.21. Controls on Prepayment if Aggregate Revolving Extensions of Credit Exceed Aggregate
Revolving Credit Commitments. (a) The Australian Subsidiary Borrowers will implement and maintain internal controls to
monitor the borrowings and repayments of Australian Dollar Loans by the relevant Australian
Subsidiary Borrowers and the issuance of and drawings under Australian Letters of Credit, with the
object of preventing any request for an Extension of Credit that would result in the Available
Australian Commitments becoming negative by more than 5% of the Australian Commitments, if such
Commitments are negative by more than 5%, the Australian Subsidiary Borrowers will promptly notify
the Australian Administrative Agent.

          (b) The Australian Administrative Agent will calculate the Available Australian Commitments
from time to time, and in any event not less frequently than once during each calendar quarter. In
making such calculations, the Australian Administrative Agent will rely on the information most
recently received by it from the Australian Dollar Swing Line Lender in respect of outstanding
Australian Dollar Swing Line Loans and from the Australian Issuing Lender in respect of outstanding
Australian L/C Obligations.

          (c) In the event that on any date the Australian Administrative Agent calculates that (i) the
Available Australian Commitments have become negative solely as a result of a change in the
aggregate Dollar Equivalent (Australia) of the Australian Dollar Loans by more than 5%, the
Australian Administrative Agent will give notice to such effect to the relevant Australian
Subsidiary Borrowers and the Australian Dollar Lenders. Within five Business Days (Australia) of
receipt of any such notice, such

 

15

Australian Subsidiary Borrower will, as soon as practicable but in
any event within five Business Days (Australia) of receipt of such notice, first, make such
repayments or prepayments of Australian Dollar Loans (together with interest accrued to the date of
such repayment or prepayment), second, pay any Reimbursement Obligations under the
Australian Facility then outstanding and third, cash collateralize any outstanding
Australian L/C Obligations on terms reasonably satisfactory to the Australian Administrative Agent
as shall be necessary to cause the Available Australian Commitments not to be negative.

          2.22. Lending Installations. (a) Subject to subsection 2.4 of the Credit Agreement and subsections 2.1 and 2.3 of this
Annex C each Australian Dollar Lender may book its Australian Dollar Loans at any Lending
Installation selected by such Australian Dollar Lender and may change its Lending Installation from
time to time. All terms of the Credit Agreement shall apply to any such Lending Installation and
the Australian Dollar Loans made hereunder shall be deemed held by each Australian Dollar Lender
for the benefit of such Lending Installation, provided that such Lending Installation is an
Eligible Australian Bank. Each Australian Dollar Lender may, by written notice to the Australian
Administrative Agent and the Australian Subsidiary Borrowers in accordance with subsection 10.2 of
the Credit Agreement and subject always to subsection 2.4 of the Credit Agreement and subsections
2.1 and 2.3 of this Annex C designate replacement or additional Lending Installations through which
Australian Dollar Loans will be made by it and for whose account Australian Dollar Loan payments
are to be made.

          (b) Each Australian Dollar Lender agrees that, upon the occurrence of any event giving rise
to the operation of subsection 2.17 or 2.19 with respect to such Australian Dollar Lender, it will,
if requested by the Australian Subsidiary Borrower, use reasonable efforts (subject to overall
policy considerations of such Australian Dollar Lender) to designate another Lending Installation
for any Australian Dollar Loans affected by such event with the object of avoiding the consequences
of such event; provided, that such designation is made on terms that, in the sole judgment
of such Australian Dollar Lender, cause such Australian Dollar Lender and any of its Lending
Installations to suffer no economic, legal or regulatory disadvantage, and provided,
further, that nothing in this subsection 2.22(b) shall affect or postpone any of the
obligations of the Australian Subsidiary Borrowers or the rights of any Australian Dollar Lender
pursuant to subsection 2.17 or 2.19.

          2.23. Notices to Lenders. All notices under this Section 2 to Australian Dollar Lenders by the Australian Subsidiary
Borrowers or the Australian Administrative Agent, and all payments by the Australian Administrative
Agent to the Australian Dollar Lenders, shall be made to the respective Lending Installations of
the Australian Dollar Lenders maintaining the relevant Australian Dollar Loans or Australian
Commitments.

SECTION 3. LETTER OF CREDIT FACILITIES

          3.1. Australian L/C Commitment. (a) Subject to the terms and conditions hereof, the Australian Issuing Lender, in reliance
on the agreements of the other Lenders set forth in subsection 3.4(a), agrees to issue letters of
credit (“Australian Letters of Credit”) under the Australian Commitments for the account of
any Australian Subsidiary Borrower on any Business Day (Australia) during the Revolving Credit
Commitment Period in such form as may be approved from time to time by the Australian Issuing
Lender; provided that the Australian Issuing Lender shall not have any obligation to issue any
Australian Letter of Credit if, after giving effect to such issuance, (i) the Australian L/C
Obligations would exceed the Australian L/C Commitment or (ii) the Available Australian Commitments
would be negative. Each Australian Letter of Credit shall (i) be denominated in Australian
Dollars, (ii) be either (x) a standby letter of credit (a “Australian Standby L/C”) issued
to support obligations of any Australian Subsidiary Borrower, contingent or otherwise, with an
expiry date occurring not later than one year after such standby Australian L/C was issued (which
expiry date may be subject to one or more

 

16

automatic extensions of one year or less unless 60-day
notice, or such other notice as is satisfactory to the relevant Australian Subsidiary Borrower and
the Australian Issuing Lender, is given that any such extension shall not be effective) or (y) a
documentary letter of credit in respect of the purchase of goods or services by any Australian
Subsidiary Borrower in the ordinary course of business with an expiry date occurring not later than
one year after such documentary letter of credit was issued and, in the case of any such
documentary letter of credit which is to be accepted by the Australian Issuing Lender pending
payment at a date after presentation of sight drafts, with a payment date no more than one year
after such drafts were presented for acceptance (a “Australian Trade L/C”) and (iii) expire
no later than five days before the Revolving Credit Termination Date.

          (b) Each Australian Standby L/C shall be subject to the International Standby Practices and
each Australian Trade L/C shall be subject to the Uniform Customs and, in each case, to the extent
not inconsistent therewith, the laws of the State of New York.

          (c) The Australian Issuing Lender shall at no time be obligated to issue any Australian
Letter of Credit hereunder if such issuance would conflict with, or cause the Australian Issuing
Lender or any Australian L/C Participant to exceed any limits imposed by, any applicable
Requirement of Law.

          3.2. Procedure for Issuance of Letters of Credit. Any Australian Subsidiary Borrower may from time to time request that the Australian
Issuing Lender issue an Australian Letter of Credit by delivering to the Australian Issuing Lender
(with a copy to the Australian Administrative Agent) at its address for notices specified herein an
Application therefor, completed to the satisfaction of the Australian Issuing Lender, and such
other certificates, documents and other papers and information as the Australian Issuing Lender may
reasonably request. Upon receipt of any Application, the Australian Issuing Lender will process
such Application and the certificates, documents and other papers and information delivered to it
in connection therewith in accordance with its customary procedures and shall promptly issue the
Australian Letter of Credit requested thereby (but in no event shall the Australian Issuing Lender
be required to issue any Australian Letter of Credit earlier than four Business Days (Australia)
after its receipt of the Application therefor and all such other certificates, documents and other
papers and information relating thereto) by issuing the original of such Australian Letter of
Credit to the beneficiary thereof or as otherwise may be agreed by the Australian Issuing Lender
and any relevant Australian Subsidiary Borrower. The Australian Issuing Lender shall furnish a
copy of such Australian Letter of Credit to the relevant Australian Subsidiary Borrower, to the
Australian Administrative Agent promptly following the issuance thereof.

          3.3. Fees, Commissions and Other Charges. (a) The relevant Australian Subsidiary Borrower shall pay to the Australian Administrative
Agent, for the ratable account of the Australian Issuing Lender and the Australian L/C
Participants, a letter of credit commission in Australian Dollars with respect to each Australian
Trade L/C issued by the Australian Issuing Lender (i) in an amount equal to the Dollar Equivalent
(Australia) of such issuance and payment fees as have been agreed upon by relevant Australian
Subsidiary Borrower and the Australian Issuing Lender and (ii) in an amount equal to the product
of, on the date on which such commission is calculated, (A) the rate per annum equal to the
Applicable Margin in respect of BBR Loans and (B) the Dollar Equivalent (Australia) of the
aggregate amount available to be drawn under each Australian Letter of Credit (plus an additional
1/4 of 1% per annum which shall be payable for the account of the Australian Issuing Lender). Such
letter of credit commissions shall be payable in arrears on the last day of each March, June,
September and December and shall be nonrefundable.

          (b) The relevant Australian Subsidiary Borrower shall pay to the Australian Administrative
Agent, for the ratable account of the Australian Issuing Lender and the Australian L/C
Participants, a letter of credit commission in Australian Dollars with respect to each Australian
Standby

 

17

L/C issued by the Australian Issuing Lender, computed for the period from the date of such
payment to the date upon which the next such payment is due hereunder in an amount equal to the
product of (i) the rate equal to the Applicable Margin in respect of BBR Loans in effect on the
date on which such commission is calculated and (ii) the Australian Dollar equivalent of the
aggregate amount available to be drawn under such Australian Standby L/C on the date on which such
commission is calculated (plus an additional 1/4 of 1% per annum which shall be payable for the
account of the Australian Issuing Lender). The relevant Australian Subsidiary Borrower shall also
pay to the Australian Administrative Agent, for the account of the Australian Issuing Lender, such
issuance fees as have been agreed upon by the relevant Australian Subsidiary Borrower and the
Australian Issuing Lender. Such letter of credit commissions shall be payable in arrears on the
last day of each March, June, September and December and shall be nonrefundable.

          (c) In addition to the foregoing fees and commissions, the relevant Australian Subsidiary
Borrower shall pay or reimburse the Australian Issuing Lender for such normal and customary costs
and expenses as are incurred or charged by the Australian Issuing Lender in issuing, effecting
payment under, amending or otherwise administering any Australian Letter of Credit issued by it.

          (d) The Australian Administrative Agent shall, promptly following its receipt thereof,
distribute to the Australian Issuing Lender and the Australian L/C Participants all fees and
commissions received by the Australian Administrative Agent for their respective accounts pursuant
to this subsection 3.3.

          3.4. Australian L/C Participation. (a) The Australian Issuing Lender irrevocably agrees to grant and hereby grants to each
Australian L/C Participant, and, to induce the Australian Issuing Lender to issue Australian
Letters of Credit hereunder, each such Australian L/C Participant irrevocably agrees to accept and
purchase and hereby accepts and purchases from the Australian Issuing Lender, on the terms and
conditions hereinafter stated, for such Australian L/C Participant’s own account and risk an
undivided interest equal to such Australian L/C Participant’s ratable share of the Australian
Facility in the Australian Issuing Lender’s obligations and rights under each Australian Letter of
Credit issued hereunder and the amount of each draft paid by the Australian Issuing Lender
thereunder. Each such Australian L/C Participant unconditionally and irrevocably agrees with the
Australian Issuing Lender that, if a draft is paid under any such Australian Letter of Credit for
which the Australian Issuing Lender is not reimbursed in full by the relevant Australian Subsidiary
Borrower in accordance with the terms of the Credit Agreement (including this Annex C), such
Australian L/C Participant shall pay to the Australian Issuing Lender upon demand at the Australian
Issuing Lender’s address for notices specified herein an amount equal to such Australian L/C
Participant’s ratable share of the Australian Facility of the amount of such draft, or any part
thereof, which is not so reimbursed.

          (b) If any amount required to be paid by any Australian L/C Participant to the Australian
Issuing Lender pursuant to subsection 3.4(a) in respect of any unreimbursed portion of any payment
made by the Australian Issuing Lender under any Australian Letter of Credit is not paid to the
Australian Issuing Lender within three Business Days (Australia) after the date such payment is
due, such Australian L/C Participant shall pay to the Australian Issuing Lender on demand an amount
equal to the product of (i) such amount, times (ii) the customary rate as selected by the
Australian Issuing Lender for the settlement of obligations between banks during the period from
and including the date such payment is required to the date on which such payment is immediately
available to the Australian Issuing Lender, times (iii) a fraction the numerator of which
is the number of days that elapse during such period and the denominator of which is 360. If any
such amount required to be paid by any such Australian L/C Participant pursuant to subsection
3.4(a) is not in fact made available to the Australian Issuing Lender by such Australian L/C
Participant within three Business Days (Australia) after the date such payment is due, the
Australian Issuing Lender shall be entitled to recover from such Australian L/C Participant, on

 

18

demand, such amount with interest thereon calculated from such due date at the rate per annum
applicable to BBR Loans hereunder. A certificate of the Australian Issuing Lender submitted to any
Australian L/C Participant with respect to any amounts owing under this subsection shall be
conclusive in the absence of manifest error.

          (c) Whenever, at any time after the Australian Issuing Lender has made payment under any
Australian Letter of Credit and has received from any Australian L/C Participant its ratable share
of such payment in accordance with subsection 3.4(a), the Australian Issuing Lender receives any
payment related to such Australian Letter of Credit (whether directly from the relevant Australian
Subsidiary Borrower or otherwise), or any payment of interest on account thereof, the Australian
Issuing Lender will distribute to such Australian L/C Participant its ratable share thereof;
provided, however, that in the event that any such payment received by the
Australian Issuing Lender shall be required to be returned by the Australian Issuing Lender, such
Australian L/C Participant shall return to the Australian Issuing Lender the portion thereof
previously distributed by the Australian Issuing Lender to it.

          3.5. Reimbursement Obligation of the Australian Subsidiary Borrowers. The relevant Australian Subsidiary Borrower agrees to reimburse the Australian Issuing
Lender on each date on which the Australian Issuing Lender notifies such Australian Subsidiary
Borrower of the date and amount of a draft presented under any Australian Letter of Credit and paid
by the Australian Issuing Lender for the amount of (a) such draft so paid and (b) any taxes (other
than Excluded Taxes), fees, charges or other costs or expenses incurred by the Australian Issuing
Lender in connection with such payment; provided that upon the acceleration of such
reimbursement obligations in accordance with Section 8 of the Credit Agreement, the relevant
Australian Subsidiary Borrower agrees to reimburse the Australian Issuing Lender for the amount
equal to then maximum liability (whether direct or contingent) of the Australian Issuing Lender and
the Australian L/C Participants under such Australian Letter of Credit. Each such payment shall be
made to the Australian Issuing Lender, at its address for notices specified herein in Australian
Dollars and in immediately available funds, on the date on which the relevant Australian Subsidiary
Borrower receives such notice, if received prior to 10:00 A.M., Sydney time, on a Business Day
(Australia) and otherwise on the next succeeding Business Day (Australia).

          3.6. Obligations Absolute. Any relevant Australian Subsidiary Borrower’s obligations under this Section 3 shall be
absolute and unconditional under any and all circumstances and irrespective of any set-off,
counterclaim or defense to payment which any relevant Australian Subsidiary Borrower may have or
have had against the Australian Issuing Lender or any beneficiary of an Australian Letter of
Credit. Each Australian Subsidiary Borrower also agrees with the Australian Issuing Lender that
the Australian Issuing Lender shall not be responsible for, such relevant Australian Subsidiary
Borrower’s Reimbursement Obligations under subsection 3.5 shall not be affected by, among other
things, the validity or genuineness of documents or of any endorsements thereon, even though such
documents shall in fact prove to be invalid, fraudulent or forged, or any dispute between or among
any relevant Australian Subsidiary Borrower and any beneficiary of any Australian Letter of Credit
or any other party to which such Australian Letter of Credit may be transferred or any claims
whatsoever of the relevant Australian Subsidiary Borrower against any beneficiary of such
Australian Letter of Credit or any such transferee. The Australian Issuing Lender shall not be
liable for any error, omission, interruption or delay in transmission, dispatch or delivery of any
message or advice, however transmitted, in connection with any Australian Letter of Credit issued
by it, except for errors or omissions caused by the Australian Issuing Lender’s gross negligence or
willful misconduct. Each Australian Subsidiary Borrower agrees that any action taken or omitted by
the Australian Issuing Lender under or in connection with any Australian Letter of Credit issued by
it or the related drafts or documents, if done in the absence of gross negligence or willful
misconduct and in accordance with the standards of care specified in the Uniform Commercial Code of
the State of New York, shall be binding on the any relevant Australian Subsidiary Borrower and

 

19

shall not result in any liability of the Australian Issuing Lender to any relevant Australian
Subsidiary Borrower.

          3.7. Increased Costs. If the adoption of or any change in any law or regulation or in the interpretation thereof
after the date hereof by any court or administrative or Governmental Authority charged with the
administration thereof shall either (i) impose, modify or deem applicable any reserve, special
deposit or similar requirement against Australian Letters of Credit issued by the Australian
Issuing Lender or participated in by the Lenders or (ii) impose on any Australian Dollar Lender any
other condition regarding any Australian Letter of Credit, and the result of any event referred to
in clauses (i) or (ii) above shall be to increase the cost to the Australian Issuing Lender or any
Australian Dollar Lender of issuing or maintaining such Australian Letter of Credit (or its
participation therein, as the case may be) (which increase in cost shall be the result of the
Australian Issuing Lender’s or such Lender’s reasonable allocation of the aggregate of such cost
increases resulting from such events), then, upon notice to it from the Australian Issuing Lender
or such Lender (with a copy to the Australian Administrative Agent) certifying that (x) one of the
events herein above described has occurred and the nature of such event, (y) the increased cost or
reduced amount resulting from such event and (z) the additional amounts demanded by the Australian
Issuing Lender or such Lender, as the case may be, and a reasonably detailed explanation of the
calculation thereof, the relevant Australian Subsidiary Borrower shall immediately pay to such
Australian Issuing Lender or such Lender, as the case may be, from time to time as specified by the
Australian Administrative Agent or such Australian Dollar Lender, additional amounts which shall be
sufficient to compensate such Australian Issuing Lender or such Australian Dollar Lender for such
increased cost, together with interest on each such amount from the date demanded until payment in
full thereof at the rate provided in subsection 3.3. A certificate as to the fact and amount of
such increased cost incurred by the Australian Issuing Lender or such Australian Dollar Lender as a
result of any event mentioned in clauses (i) or (ii) above, submitted by the Australian Issuing
Lender or such Lender to such Australian Subsidiary Borrower, shall be conclusive, absent manifest
error.

          3.8. Australian Letter of Credit Payments. If any draft in Australian Dollars shall be presented for payment under any Australian
Letter of Credit, the Australian Issuing Lender shall promptly notify the relevant Australian
Subsidiary Borrower and the Australian Administrative Agent of the date and amount of the
Australian thereof. The responsibility of the Australian Issuing Lender to the Australian
Subsidiary Borrowers in connection with any draft presented for payment under any Australian Letter
of Credit shall, in addition to any payment obligation expressly provided for in such Australian
Letter of Credit, be limited to determining that the documents (including each draft) delivered
under such Australian Letter of Credit in connection with such presentment are in conformity with
such Australian Letter of Credit.

          (a) Application. To the extent that any provision of any Application related to any Australian Letter of
Credit is inconsistent with the provisions of the Credit Agreement, the provisions of the Credit
Agreement shall apply.

          (b) Purpose of the Letters of Credit. The Australian Letters of Credit shall be used for any lawful purposes requested by the
Australian Subsidiary Borrowers.

 

APPENDIX I

PRICING GRID FOR AUSTRALIAN DOLLAR LOANS

PRICING GRID

	 	 	 	 	 	 	 	 	 
		 	Applicable
	Leverage	 	Margin
	Ratio	 	Bank Bill Rate	 	Overnight Rate
	> 4.00 to 1.00
	 	 	1.500	%	 	 	0.500	%
	> 3.00 to 1.00
	 	 	1.250	%	 	 	0.250	%
	> 2.25 to 1.00
	 	 	1.000	%	 	 	0.000	%
	> 1.75 to 1.00
	 	 	0.875	%	 	 	0.000	%
	> 1.25 to 1.00
	 	 	0.750	%	 	 	0.000	%
	< 1.25 to 1.00
	 	 	0.625	%	 	 	0.000	%

Changes in the Applicable Margin resulting from changes in the Leverage Ratio shall become
effective on the date (the “Adjustment Date”) on which financial statements are delivered to the
Lenders pursuant to subsection 6.1 (but in any event not later than the 45th day after
the end of each of the first three quarterly periods of each fiscal year of the Borrower or the
90th day after the end of each fiscal year of the Borrower, as the case may be) and
shall remain in effect until the next change to be effected pursuant to this paragraph. If any
financial statements referred to above are not delivered within the time periods specified above,
then, until such financial statements are delivered, the Leverage Ratio as at the end of the fiscal
period that would have been covered thereby shall for the purposes of this definition be deemed to
be greater than or equal to 3.25 to 1.00. In addition, at all times while an Event of Default
shall have occurred and be continuing, the Leverage Ratio shall for the purposes of this definition
be deemed to be greater than 3.25 to 1.00. Each determination of the Leverage Ratio pursuant to
this pricing grid shall be made with respect to (or, in the case of Average Total Indebtedness, as
at the end of) the period of four consecutive fiscal quarters of the Borrower ending at the end of
the period covered by the relevant financial statements.

 

ANNEX D

SECTION 1. DEFINITIONS

          Defined Terms. Unless otherwise defined herein, terms defined in the Amended and
Restated Credit Agreement, dated as of February 7, 2007 (as amended, restated supplemented or
otherwise modified from time to time, the “Credit Agreement”) to which this Annex D is
attached and used herein shall have the meanings given to them in the Credit Agreement, and the
following terms shall have the following meanings:

     “Acceptance Fee” shall mean the fee payable in Canadian Dollars to each
Canadian Dollar Lender in respect of Bankers’ Acceptances computed in accordance with
subsection 2.3(g).

     “Aggregate Canadian Revolving Extensions of Credit” shall mean an amount equal
to the sum of (a) the aggregate principal amount of all Canadian Dollar Loans (including,
without limitation, Canadian Dollar Swing Line Loans borrowed under Canadian Commitments)
then outstanding and (b) the aggregate amount of all Canadian L/C Obligations then
outstanding.

     “Aggregate Facility D Revolving Extensions of Credit” shall mean an amount
equal to the sum of (a) the aggregate principal amount of all Facility D Loans (including,
without limitation, Canadian Dollar Swing Line Loans borrowed under Facility D Commitments)
then outstanding and (b) the aggregate amount of all Canadian L/C Obligations then
outstanding in respect of Letters of Credit issued under the Facility D Commitments.

     “Applicable BA Discount Rate” shall mean (i) with respect to any Schedule I
Canadian Dollar Lender, as applicable to a Bankers’ Acceptance being purchased by such
Schedule I Canadian Dollar Lender on any day, the CDOR Rate on such day (or, if no CDOR Rate
is quoted for such day, the average (as determined by the Canadian Administrative Agent) of
the respective percentage discount rates (expressed to two decimal places and rounded
upward, if necessary, to the nearest 1/100th of 1%) quoted to the Canadian
Administrative Agent by each Schedule I Canadian Dollar Reference Lender as the percentage
discount rate at which such Schedule I Canadian Dollar Reference Lender would, in accordance
with its normal practices, at or about 10:00 A.M. (Toronto time) on such day, be prepared to
purchase bankers’ acceptances accepted by such Schedule I Canadian Dollar Reference Lender
having a term and face amount comparable to the term and face amount of such Bankers’
Acceptance) and (ii) with respect to any Non-Schedule I Canadian Dollar Lender, as
applicable to a Bankers’ Acceptance being purchased by such Non-Schedule I Canadian Dollar
Lender on any day, the lesser of (x) the average (as determined by the Canadian
Administrative Agent) of the respective percentage discount rates (expressed to two decimal
places and rounded upward, if necessary, to the nearest 1/100th of 1%) quoted to
the Canadian Administrative Agent by the Non-Schedule I Canadian Dollar Reference Lender as
the percentage discount rate at which such Non-Schedule I Canadian Dollar Reference Lender
would, in accordance with its normal practices, at or about 10:00 A.M. (Toronto time) on
such day, be prepared to purchase bankers’ acceptances accepted by such Non-Schedule I
Canadian Dollar Lender Reference having a term and a face amount comparable to the term and
face amount of such Bankers’ Acceptance and (y) the rate that is 0.10% per annum in excess
of the rate determined pursuant to clause (i) of this definition in connection with the
relevant issuance of Bankers’ Acceptances.

 

2

     “Applicable Margin for Canadian Borrowing” shall mean for each type of Canadian
Dollar Loan, the rate per annum set forth under the relevant column heading in the pricing
grid attached as Appendix I hereto.

     “Application” shall mean an application, in such form as the Canadian Issuing
Lender may specify from time to time, requesting such Canadian Issuing Lender to open a
Canadian Letter of Credit.

     “Available Canadian Commitment” shall mean, as to any Lender at any time, the
amount equal to the excess, if any, of (a) such Lender’s Canadian Commitment over
(b) the sum of such Lender’s (i) ratable portion of the Aggregate Facility D Revolving
Extensions of Credit and (ii) ratable portion of the Aggregate Canadian Revolving Extensions
of Credit. The Available Canadian Commitment may be calculated as being negative at any
time.

     “BA Equivalent Loan” shall have the meaning assigned such term in subsection
2.3(c).

     “BA Discount Proceeds” shall mean in respect of any Bankers’ Acceptance to be
purchased by a Canadian Dollar Lender on any day under subsection 2.3, an amount (rounded to
the nearest whole Canadian cent, and with one-half of one Canadian cent being rounded up)
calculated on such day by dividing:

     (a) the face amount of such Bankers’ Acceptance; by

     (b) the sum of one plus the product of:

	 	(i)	 	the Applicable BA Discount Rate (expressed as a
decimal) applicable to such Bankers’ Acceptance; and
	 
	 	(ii)	 	a fraction, the numerator of which is the
number of days remaining in the term of such Bankers’ Acceptance and
the denominator of which is 365;
	 
	 	 	 	with such product being rounded up or down to the fifth decimal place
and .000005 being rounded up.

     “Bankers’ Acceptance” shall mean a bill of exchange or a depository bill
governed by the Depository Bills and Notes Act (Canada) denominated in Canadian Dollars
drawn by the Canadian Subsidiary Borrowers and accepted by a Canadian Dollar Lender pursuant
to subsection 2.3.

     “Borrowing Date (Canada)” shall mean any Business Day (Canada) specified in a
notice as a date on which any Canadian Subsidiary Borrower requests the relevant Canadian
Dollar Lenders to make Canadian Dollar Loans under this Annex D to the Credit Agreement.

     “Business Day (Canada)” shall mean a day on which banks are open for business
in Toronto, Ontario, Canada but excludes Saturday, Sunday and any other day which is a legal
holiday in Toronto, Ontario, Canada.

     “Canadian Administrative Agent” shall mean JPMorgan Chase Bank, N.A., Toronto
Branch, together with its affiliates, as the agent for the Canadian Dollar Lenders under the
Credit Agreement.

 

3

     “Canadian Administrative Office” shall mean the Canadian Administrative Agent’s
office located at 200 Bay Street, Royal Bank Plaza, South Tower, Suite 1800, Toronto,
Ontario M5J 2J2, or such other office in Canada as may be designated as such by the Canadian
Administrative Agent by written notice to the Canadian Subsidiary Borrowers and the Canadian
Dollar Lenders.

     “Canadian Commitment” shall mean, as to any Canadian Dollar Lender, the
obligation of such Canadian Dollar Lender to make Canadian Dollar Prime Loans to and
purchase Bankers’ Acceptances from the Canadian Subsidiary Borrowers and participate in
Canadian Dollar Swing Line Loans or Canadian Letters of Credit hereunder in an aggregate
principal or face amount at any one time outstanding up to but not exceeding the amount set
forth opposite such Canadian Dollar Lender’s name on Schedule 1 to the Credit Agreement
under the caption “Canadian Commitment” or in the Assignment and Acceptance pursuant to
which such Canadian Dollar Lender became party to the Credit Agreement, as the same may be
changed from time to time pursuant to the terms hereof. The original aggregate principal
amount of the Canadian Commitments is the Canadian Dollar equivalent of U.S.$35,000,000.

     “Canadian Dollars” or “C$” shall mean dollars in lawful currency of
Canada.

     “Canadian Dollar Commitment Percentage” shall mean as to any Canadian Dollar
Lender at any time, the percentage of the aggregate Canadian Commitments then constituted by
such Canadian Dollar Lender’s Canadian Commitment.

     “Canadian Dollar Lender” shall mean each Lender that has a Canadian Commitment
or that holds Canadian Dollar Loans; collectively, the “Canadian Dollar Lenders”.
Each Canadian Dollar Lender on the date hereof and on each date on which a payment or
prepayment of interest is made represents that it is an Eligible Canadian Bank.

     “Canadian Dollar Loans” shall mean the collective reference to Canadian Dollar
Prime Loans and Bankers’ Acceptances; for the purposes of the Credit Agreement, the
principal amount of any Canadian Dollar Loan constituting a Bankers’ Acceptance shall be
deemed to be the undiscounted face amount of such Bankers’ Acceptance.

     “Canadian Dollar Swing Line Commitment” shall mean the obligation of the
Canadian Dollar Swing Line Lender, at any date, to make a Canadian Dollar Swing Line Loan
pursuant to subsection 2.6(a) in the amount referred to therein.

     “Canadian Dollar Swing Line Lender” shall mean the Bank of Montreal and such
other Lenders or Affiliates thereof as may be designated in writing by the Canadian
Subsidiary Borrowers which agree in writing to act as such in accordance with the terms
hereof and are reasonably acceptable to the Canadian Administrative Agent.

     “Canadian Dollar Swing Line Loan” shall mean any Canadian Dollar Swing Line
Loan made pursuant to subsection 2.6 hereof.

     “Canadian Dollar Prime Loans” shall mean advances denominated in Canadian
Dollars that bear interest at a rate based upon the Canadian Dollar Prime Rate.

     “Canadian Dollar Prime Rate” shall mean with respect to a Canadian Dollar Prime
Loan, on any day, the greater of (a) the annual rate of interest announced from time to time
by the Canadian Administrative Agent as its reference rate then in effect for determining
interest rates

 

4

on Canadian Dollar denominated commercial loans in Canada and (b) the annual rate of
interest equal to the sum of (i) the 30-day CDOR Rate and (ii) 0.50% per annum.

     “Canadian Facility” shall mean the Canadian Commitments together with the
Aggregate Canadian Revolving Extensions of Credit.

     “Canadian Issuing Lender” shall mean the Bank of Montreal.

     “Canadian L/C Commitment” shall mean the Canadian Dollar equivalent of
U.S.$35,000,000.

     “Canadian L/C Obligations” shall mean, at any time, an amount equal to the sum
of (a) the aggregate then undrawn and unexpired amount of then outstanding Canadian Letters
of Credit and (b) the aggregate amount of drawings under Canadian Letters of Credit which
have not then been reimbursed pursuant to Section 3.

     “Canadian L/C Participants” shall mean the collective reference to all the
Canadian Dollar Lenders other than the Canadian Issuing Lender.

     “Canadian Lending Office” shall mean for each Canadian Dollar Lender, the
lending office for such Canadian Dollar Lender (or of an affiliate of such Canadian Dollar
Lender) designated for each type of Canadian Dollar Loan in the Administrative Questionnaire
of such Canadian Dollar Lender or such other lending office of such Canadian Dollar Lender
(or of an affiliate of such Canadian Dollar Lender) as such Canadian Dollar Lender may from
time to time specify to the Canadian Administrative Agent and the Canadian Subsidiary
Borrowers as the office by which its Canadian Dollar Loans of such type are to be made and
maintained.

     “Canadian Letter of Credit” shall mean any Canadian Standby L/C or Canadian
Trade L/C, as each term is defined in subsection 3.1.

     “CDOR Rate” shall mean on any date, the per annum rate of interest which is the
rate based on the rate applicable to Canadian Dollar bankers’ acceptances for the applicable
term appearing on the “Reuters Screen CDOR Page” (as defined in the International Swap
Dealer Association, Inc. definitions, as modified and amended from time to time) on such
date, or if such date is not a Business Day (Canada), then on the immediately preceding
Business Day (Canada); provided, however, that if no such rate appears on
the Reuters Screen CDOR Page as contemplated, then the CDOR Rate on any date shall be
calculated as the arithmetic mean of the rates for the term and amount referred to above
applicable to Canadian Dollar bankers’ acceptances quoted by the Schedule I Canadian Dollar
Reference Lenders as of 10:00 A.M., Toronto time, on such date or, if such date is not a
Business Day (Canada), then on the immediately preceding Business Day (Canada).

     “Dollar Equivalent (Canada)” shall mean, on any Business Day (Canada) with
respect to any amount denominated in Canadian Dollars, the amount of U.S. Dollars that would
be required to purchase such amount of Canadian Dollars based upon the spot selling rate at
which JPMorgan Chase Bank, N.A., Toronto Branch offers to sell Canadian Dollars for U.S.
Dollars in the Toronto foreign exchange market at approximately 11:00 A.M. Toronto time on
such Business Day (Canada) for delivery two Business Days (Canada) later.

     “Draft” shall mean a blank bill of exchange, within the meaning of the Bills of
Exchange Act (Canada), in substantially the form set forth in Exhibit A to this Annex D,
drawn by the

 

5

Canadian Subsidiary Borrowers on a Canadian Dollar Lender, denominated in Canadian
Dollars and bearing such distinguishing letters and numbers as such Lender may determine,
but which at such time, except as otherwise provided herein, has not been completed or
accepted by such Lender.

     “Drawing” shall mean the creation and purchase of Bankers’ Acceptances and/or
the purchase of completed Drafts, by the Canadian Dollar Lenders pursuant to subsection 2.3.

     “Eligible Canadian Bank” shall mean (a) those banks listed on Schedules I, II
or III to the Bank Act (Canada), (b) any (i) trust company, savings bank, savings
and loan association or similar financial institution, or (ii) insurance company engaged in
the business of writing insurance which, in either case (A) has total assets of
U.S.$10,000,000,000 or more, (B) is engaged in the business of lending money and extending
credit under credit facilities substantially similar to those extended under this Agreement,
(C) is operationally and procedurally able to meet the obligations of a Lender hereunder to
the same degree as a commercial bank, and (c) any other financial institution (including a
mutual fund or other fund) having total assets of U.S.$10,000,000,000 or more which meets
the requirements set forth in subclauses (B) and (C) of clause (b) above, and in each case,
which agree to make Canadian Dollar Loans hereunder; provided that each Eligible
Canadian Bank must be organized under the laws of either Canada or a political subdivision
thereof or, if not, it must (i) act hereunder through a branch, agency or funding office
located in Canada and (ii) be exempt from withholding of tax on interest payments made to it
by residents of Canada.

     “Non-Schedule I Canadian Dollar Lender” shall mean each Canadian Dollar Lender
which is not a Schedule I Canadian Dollar Lender.

     “Non-Schedule I Canadian Dollar Reference Lender” shall mean JPMorgan Chase
Bank, N.A., Toronto Branch.

     “Post-Default Rate” shall mean a rate equal to the sum of 2% plus the
rate of interest otherwise applicable to such Canadian Dollar Loan.

     “Requirement of Law” shall mean, as to any Person, the Certificate of
Incorporation or Articles of Incorporation, as the case may be, and Code of Regulations
and/or By-Laws or other organizational or governing documents of such Person, and any law,
treaty, rule or regulation, or determination of an arbitrator or a court or other
Governmental Authority, in each case applicable to or binding upon such Person or any of its
property or to which such Person or any of its property is subject.

     “Schedule I Canadian Dollar Lender” shall mean any Canadian bank named on
Schedule I to the Bank Act (Canada).

     “Schedule I Canadian Dollar Reference Lender” shall mean the Bank of Montreal.

SECTION 2. THE CANADIAN COMMITMENTS

          2.1. The Canadian Commitments. Subject to the terms and conditions hereof, each Canadian Dollar Lender severally (but not
jointly) agrees to make Canadian Dollar Loans in Canadian Dollars to each Canadian Subsidiary
Borrower from time to time during the Revolving Credit Commitment Period in an aggregate principal
amount not to exceed the Available Canadian Commitment of such Canadian Dollar Lender in
accordance with the terms hereof (which for this purpose shall be

 

6

computed as though the amount in
subclause (b)(i) in the definition thereof is $0); provided that, after giving effect to
the making of such Canadian Dollar Loans, the Aggregate Canadian Revolving Extensions of Credit
will not exceed the Canadian Commitment. During the Revolving Credit Commitment Period the
Canadian Subsidiary Borrowers may use the Canadian Commitments by borrowing, repaying the Canadian
Dollar Loans in whole or in part, and reborrowing, all in accordance with the terms and conditions
hereof. Each Canadian Dollar Lender agrees that each of its Lending Installations listed on
Schedule 1 and subsequently agreed from time to time in Canada shall be on the date hereof or the
date of such agreement an Eligible Canadian Bank.

          2.2. Procedure for Canadian Dollar Prime Loan Borrowing. The Canadian Subsidiary Borrowers may borrow Canadian Dollar Prime Loans during the
Commitment Period on any Business Day (Canada), provided that the Canadian Subsidiary Borrowers
shall give the Canadian Administrative Agent irrevocable written or telephonic notice (in the case
of telephonic notice, to be promptly confirmed in writing) one Business Day (Canada) prior to the
requested Borrowing Date (Canada) (which notice must be received by the Canadian Administrative
Agent prior to 10:00 A.M., Toronto time), specifying (a) the amount to be borrowed and (b) the
requested Borrowing Date (Canada). Each borrowing of Canadian Dollar Prime Loans shall be in an
amount equal to C$300,000 or a whole multiple of C$100,000 in excess thereof. Upon receipt of any
such irrevocable notice from the Canadian Subsidiary Borrower, the Canadian Administrative Agent
shall promptly notify each Canadian Dollar Lender thereof. Each Canadian Dollar Lender will make
the amount of its ratable share of each such borrowing available to the Canadian Administrative
Agent for the account of the Canadian Subsidiary Borrowers at the Canadian Administrative Office
prior to 11:00 A.M., Toronto time, on the Borrowing Date (Canada) requested by the Canadian
Subsidiary Borrowers in funds immediately available to the Canadian Administrative Agent. Such
borrowing will then be made available on such date to the Canadian Subsidiary Borrowers by the
Canadian Administrative Agent crediting the account(s) designated by the Canadian Subsidiary
Borrowers with the aggregate of the amounts made available to the Canadian Administrative Agent by
the Canadian Dollar Lenders and in like funds as received by the Canadian Administrative Agent.

          2.3. Bankers’ Acceptances.

          (a) The Canadian Subsidiary Borrowers may issue Bankers’ Acceptances denominated in Canadian
Dollars, for acceptance and, at the Canadian Subsidiary Borrowers’ option, purchase by the Canadian
Dollar Lenders, each in accordance with the provisions of this subsection 2.3.

          (b) Procedures.

     (1) Notice. The Canadian Subsidiary Borrowers shall notify the Canadian
Administrative Agent by irrevocable written or telephonic notice (in the case of telephonic
notice, to be promptly confirmed in writing) by 10:00 A.M., Toronto time, two Business Days
(Canada) prior to the date of the relevant borrowing in respect of any borrowing by way of
Bankers’ Acceptances.

     (2) Minimum Borrowing Amount. Each borrowing by way of Bankers’ Acceptances
shall be in a minimum aggregate face amount of C$1,000,000 or a whole multiple of C$100,000
in excess thereof.

     (3) Face Amounts. The face amount of each Bankers’ Acceptance shall be
C$100,000 or any whole multiple thereof.

 

7

     (4) Term. Bankers’ Acceptances shall be issued and shall mature on a Business
Day (Canada). Each Bankers’ Acceptance shall have a term of 30, 60, 90 or 180 days (or such
shorter or longer term as shall be agreed to by all of the Canadian Dollar Lenders), shall
mature on or before the Revolving Commitment Termination Date and shall be in form and
substance reasonably satisfactory to each Canadian Dollar Lender.

     (5) Bankers’ Acceptances in Blank. To facilitate the acceptance of Bankers’
Acceptances under the Credit Agreement, the Canadian Subsidiary Borrowers shall, from time
to time as required, provide to the Canadian Administrative Agent Drafts duly executed and
endorsed in blank by the Canadian Subsidiary Borrowers in quantities sufficient for each
Canadian Dollar Lender to fulfill its obligations hereunder. In addition, the Canadian
Subsidiary Borrowers hereby appoint each Canadian Dollar Lender as its attorney, with
respect to Bankers’ Acceptances for which the Canadian Subsidiary Borrowers have provided a
Bankers’ Acceptance notice:

     (i) to complete and sign on behalf of the Canadian Subsidiary Borrower, either
manually or by facsimile or mechanical signature, the Drafts to create the Bankers’
Acceptances (with, in each Canadian Dollar Lender’s discretion, the inscription
“This is a depository bill subject to the Depository Bills and Notes Act (Canada)”);

     (ii) after the acceptance thereof by any Canadian Dollar Lender, to endorse on
behalf of the Canadian Subsidiary Borrower, either manually or by facsimile or
mechanical signature, such Bankers’ Acceptance in favor of the applicable purchaser
or endorsee thereof including, in such Canadian Dollar Lender’s discretion, such
Canadian Dollar Lender or a clearing house (as defined by the Depository Bills and
Notes Act (Canada));

     (iii) to deliver such Bankers’ Acceptances to such purchaser or to deposit
such Bankers’ Acceptances with such clearing house; and

     (iv) to comply with the procedures and requirements established from time to
time by such Canadian Dollar Lender or such clearing house in respect of the
delivery, transfer and collection of Bankers’ Acceptances and depository bills.

The Canadian Subsidiary Borrowers recognize and agree that all Bankers’ Acceptances signed,
endorsed, delivered or deposited on its behalf by a Canadian Dollar Lender shall bind the
Canadian Subsidiary Borrowers as fully and effectually as if signed in the handwriting of
and duly issued, delivered or deposited by the proper signing officer of the Canadian
Subsidiary Borrower. Each Canadian Dollar Lender is hereby authorized to accept such Drafts
or issue such Bankers’ Acceptances endorsed in blank in such face amounts as may be
determined by such Canadian Dollar Lender in accordance with the terms of the Credit
Agreement, provided that the aggregate amount thereof is less than or equal to the
aggregate amount of Bankers’ Acceptances required to be accepted by such Canadian Dollar
Lender. No Canadian Dollar Lender shall be responsible or liable for its failure to accept
a Bankers’ Acceptance if the cause of such failure is, in whole or in part, due to the
failure of the Canadian Subsidiary Borrowers to provide duly executed and endorsed Drafts to
the Canadian Administrative Agent on a timely basis, nor shall any Canadian Dollar Lender be
liable for any damage, loss or other claim arising by reason of any loss or improper use of
any such instrument except loss or improper use arising by reason of the
gross negligence or willful misconduct of such Canadian Dollar Lender, its officers,
employees, agents or representatives. The Canadian Administrative Agent and each Canadian
Dollar Lender shall exercise such care in the custody and safekeeping of Drafts as it would
exercise in the

 

8

custody and safekeeping of similar property owned by it. Each Canadian
Dollar Lender will, upon the request of the Canadian Subsidiary Borrower, promptly advise
the Canadian Subsidiary Borrowers of the number and designation, if any, of Drafts then held
by it for the Canadian Subsidiary Borrower. Each Canadian Dollar Lender shall maintain a
record with respect to Drafts and Bankers’ Acceptances (i) received by it from the Canadian
Administrative Agent in blank hereunder, (ii) voided by it for any reason, (iii) accepted by
it hereunder, (iv) purchased by it hereunder and (v) canceled at their respective
maturities. Each Canadian Dollar Lender further agrees to retain such records in the manner
and for the statutory periods provided in the various Canadian provincial or federal
statutes and regulations which apply to such Canadian Dollar Lender.

     (6) Execution of Bankers’ Acceptances. Drafts of the Canadian Subsidiary
Borrowers to be accepted as Bankers’ Acceptances hereunder shall be duly executed on behalf
of the Canadian Subsidiary Borrower. Notwithstanding that any person whose signature
appears on any Bankers’ Acceptance as a signatory for the Canadian Subsidiary Borrowers may
no longer be an authorized signatory for the Canadian Subsidiary Borrowers at the date of
issuance of a Bankers’ Acceptance, such signature shall nevertheless be valid and sufficient
for all purposes as if such authority had remained in force at the time of such issuance,
and any such Bankers’ Acceptance so signed shall be binding on the Canadian Subsidiary
Borrower.

     (7) Issuance of Bankers’ Acceptances. Promptly following receipt of a notice
of borrowing by way of Bankers’ Acceptances, the Canadian Administrative Agent shall so
advise the Canadian Dollar Lenders and shall advise each Canadian Dollar Lender of the face
amount of each Draft to be accepted by it and the term thereof. The aggregate face amount
of Drafts to be accepted by a Canadian Dollar Lender shall be determined by the Canadian
Administrative Agent on a ratable basis by reference to the respective Canadian Commitments
of the Canadian Dollar Lenders, except that, if the face amount of a Draft which would
otherwise be accepted by a Canadian Dollar Lender would not be C$100,000 or a whole multiple
thereof, such face amount shall be increased or reduced by the Canadian Administrative Agent
in its sole and unfettered discretion to the nearest whole multiple of C$100,000.

     (8) Acceptance of Bankers’ Acceptances. Each Draft to be accepted by a
Canadian Dollar Lender shall be accepted at such Canadian Dollar Lender’s Canadian Lending
Office.

     (9) Purchase of Bankers’ Acceptances. Each Canadian Dollar Lender shall be
required to purchase from the Canadian Subsidiary Borrowers on the Borrowing Date (Canada),
at the Applicable BA Discount Rate, the Bankers’ Acceptances accepted by it on such date and
to provide to the Canadian Administrative Agent the BA Discount Proceeds thereof not later
than 12:00 Noon, Toronto time, on such Borrowing Date (Canada) for the account of the
Canadian Subsidiary Borrower. The Acceptance Fee payable by the Canadian Subsidiary
Borrowers to such Canadian Dollar Lender under subsection 2.3(f) in respect of each Bankers’
Acceptance accepted and purchased by such Canadian Dollar Lender from the Canadian
Subsidiary Borrowers shall be set off against the BA Discount Proceeds payable by such
Canadian Dollar Lender under this subsection 2.3(b)(9). Not later than 2:00 P.M., Toronto
time, on such Borrowing Date (Canada), the Canadian Administrative Agent shall make such BA
Discount Proceeds available to the Canadian Subsidiary Borrowers by crediting the account(s)
designated by the Canadian Subsidiary Borrowers with the aggregate of the amounts made
available to the
Canadian Administrative Agent by the Canadian Dollar Lenders and in like funds as
received by the Canadian Administrative Agent.

 

9

     (10) Sale of Bankers’ Acceptances. Each Canadian Dollar Lender may at any
time and from time to time hold, sell, rediscount or otherwise dispose of any or all
Bankers’ Acceptances accepted and purchased by it.

     (11) Waiver of Presentment and Other Conditions. To the extent permitted by
applicable law, each Canadian Subsidiary Borrower waives presentment for payment and any
other defense to payment of any amounts due to a Canadian Dollar Lender in respect of a
Bankers’ Acceptance accepted by it pursuant to the Credit Agreement which might exist solely
by reason of such Bankers’ Acceptance being held, at the maturity thereof, by such Canadian
Dollar Lender in its own right, and each Canadian Subsidiary Borrower agrees not to claim
any days of grace if such Canadian Dollar Lender as holder sues any Canadian Subsidiary
Borrower on the Bankers’ Acceptances for payment of the amount payable by any Canadian
Subsidiary Borrower thereunder.

          (c) If a Canadian Dollar Lender is not a chartered bank under the Bank Act (Canada)
or if a Lender notifies the Canadian Administrative Agent in writing that it is otherwise unable to
accept Bankers’ Acceptances, such Canadian Dollar Lender will, instead of accepting and purchasing
Bankers’ Acceptances, make a Loan (a “BA Equivalent Loan”) (which shall be a Canadian
Dollar Loan) to the applicable Canadian Subsidiary Borrower in the amount and for the same term as
the draft which such Canadian Dollar Lender would otherwise have been required to accept and
purchase hereunder. Each such Canadian Dollar Lender will provide to the Canadian Administrative
Agent the BA Discount Proceeds of such BA Equivalent Loan for the account of the applicable
Canadian Subsidiary Borrower. Each such BA Equivalent Loan will bear interest at the same rate
which would result if such Canadian Dollar Lender had accepted (and been paid an Acceptance Fee)
and purchased if such Canadian Dollar Lender had accepted (and been paid an Acceptance Fee) and
purchased (on a discounted basis) a Bankers’ Acceptance for the relevant term (it being the
intention of the parties that each such BA Equivalent Loan shall have the same economic
consequences for the parties that each such BA Equivalent Loan replaces). All such interest shall
be paid in advance on the date such BA Equivalent Loan is made, and will be deducted from the
principal amount of such BA Equivalent Loan in the same manner in which the BA Discount Proceeds of
a Bankers’ Acceptance would be deducted from the face amount of the Bankers’ Acceptance. Subject
to repayment requirements, on the last day of the relevant term for such BA Equivalent Loan, the
applicable Canadian Subsidiary Borrower shall be entitled to convert each such BA Equivalent Loan
into another type of Loan, or to roll over each such BA Equivalent Loan into another BA Equivalent
Loan, all in accordance with the applicable provisions of the Credit Agreement and this Annex D.
The Canadian Subsidiary Borrowers shall pay, indemnify and hold the Canadian Administrative Agent
and each Canadian Dollar Lender harmless from any and all liabilities (on an after-tax basis) with
respect to any Non-Excluded Taxes which the Canadian Administrative Agent or any Canadian Dollar
Lender, as the case may be, may be obligated to pay to any Governmental Authority as a result of
the receipt of amounts owing under this Annex D, provided however, that none of the
Canadian Subsidiary Borrowers shall be required to make an indemnification payment to the Canadian
Administrative Agent, any Canadian Dollar Lender or any holder of Bankers’ Acceptances if such
indemnification payment arises as a result of a failure of such Canadian Dollar Lender, the
Canadian Administrative Agent or any holder of Bankers’ Acceptances to be a Person resident in
Canada for the purposes of the Income Tax Act (Canada) or an “authorized foreign bank”
under Section 2 of the Bank Act (Canada).

          (d) The Canadian Subsidiary Borrowers shall reimburse each applicable Canadian Dollar Lender
for, and there shall become due and payable at 4:00 A.M., Toronto time, on the maturity date for
each Bankers’ Acceptance, an amount in Canadian Dollars in same day funds equal to the face amount
of
such Bankers’ Acceptance. The Canadian Subsidiary Borrowers shall make each such
reimbursement payment (i) by causing any proceeds of a Refunding Bankers’ Acceptance (as defined in
subsection 2.3(f) below) issued in accordance with subsection 2.3(f) or conversion of such Bankers’
Acceptance in

 

10

accordance with subsection 2.4 to be applied in reduction of such reimbursement
payment; and (ii) by depositing the amount of such reimbursement payment (or any portion thereof
remaining unpaid after application of any proceeds referred to in clause (i)) with the Canadian
Administrative Office in accordance with subsection 2.15. The Canadian Subsidiary Borrowers’
payment in accordance with this subsection shall satisfy its obligations under any Bankers’
Acceptance to which it relates, and the Canadian Dollar Lender which has accepted such Bankers’
Acceptance shall thereafter be solely responsible for the payment of such Bankers’ Acceptance.

          (e) The Canadian Subsidiary Borrowers shall give irrevocable written or telephonic notice (in
the case of telephonic notice, to be promptly confirmed in writing) (or such other method of
notification as may be agreed upon between the Canadian Administrative Agent and the Canadian
Subsidiary Borrowers) to the Canadian Administrative Agent at or before 10:00 A.M., Toronto time,
two Business Days (Canada) prior to the maturity date of each Bankers’ Acceptance of the Canadian
Subsidiary Borrowers’ intention to issue a Bankers’ Acceptance on such maturity date (a
“Refunding Bankers’ Acceptance”) to provide for the payment of such maturing Bankers’
Acceptance (it being understood that payments by the Canadian Subsidiary Borrowers and fundings by
the Canadian Dollar Lenders in respect of each maturing Bankers’ Acceptance and the related
Refunding Bankers’ Acceptance shall be made on a net basis reflecting the difference between the
face amount of such maturing Bankers’ Acceptance and the BA Discount Proceeds (net of the
applicable Acceptance Fee) of such Refunding Bankers’ Acceptance). If the Canadian Subsidiary
Borrowers fail to give such notice or do not have sufficient funds on deposit in the amount of
reimbursement payment in accordance with subsection 2.3(e)(ii), the Canadian Subsidiary Borrowers
shall be deemed to have requested that such maturing Bankers’ Acceptances be repaid with the
proceeds of Canadian Dollar Prime Loans (without any requirement to give notice with respect
thereto), commencing on the maturity date of such maturing Bankers’ Acceptances.

          (f) An Acceptance Fee shall be payable by the Canadian Subsidiary Borrowers to each Canadian
Dollar Lender in advance (in the manner specified in subsection 2.3(b)(9) hereof) upon the issuance
of a Bankers’ Acceptance to be accepted by such Canadian Dollar Lender calculated at the rate per
annum equal to the Applicable Margin for Canadian Borrowing, such Acceptance Fee to be calculated
on the face amount of such Bankers’ Acceptance and to be computed on the basis of the number of
days in the term of such Bankers’ Acceptance and a year of 365 days.

          (g) Upon the occurrence of any Event of Default which is continuing, the Canadian Subsidiary
Borrowers shall, forthwith, without any demand or the taking of any action by the Canadian
Administrative Agent, provide cover for all outstanding Bankers’ Acceptances by paying to the
Canadian Administrative Agent immediately available funds in an amount equal to then aggregate face
amount of all outstanding Bankers’ Acceptances, which funds shall be held by the Canadian
Administrative Agent in an account as collateral security, and in addition to any other rights or
remedies of any Canadian Dollar Lender and the Canadian Administrative Agent hereunder, any
Canadian Dollar Lender or the Canadian Administrative Agent (or such alternate arrangement as may
be agreed upon by the Canadian Subsidiary Borrowers and such Canadian Dollar Lender or the Canadian
Administrative Agent, as applicable) shall be entitled to deposit and retain in an account to be
maintained by the Canadian Administrative Agent (bearing interest at the Canadian Administrative
Agent’s rates as may be applicable in respect of other deposits of similar amounts for similar
terms), for the ratable benefit of the Canadian Dollar Lenders, amounts which are received by such
Canadian Dollar Lender or the Canadian Administrative Agent from the Canadian Subsidiary Borrowers
hereunder or as proceeds of the exercise of any rights or remedies of any Canadian Dollar Lender or
the Canadian Administrative Agent hereunder against the Canadian
Subsidiary Borrowers, to the extent such amounts may be required to satisfy any contingent or
unmatured obligations or liabilities of the Canadian Subsidiary Borrowers to the Canadian Dollar
Lenders or the Canadian Administrative Agent, or any of them hereunder.

 

11

          2.4. Conversion Option. Subject to the provisions of the Credit Agreement, the Canadian Subsidiary Borrowers may,
prior to the Revolving Commitment Termination Date, effective on any Business Day (Canada),
convert, in whole or in part, Canadian Dollar Prime Loans into Bankers’ Acceptances or vice versa
upon giving to the Canadian Administrative Agent prior irrevocable written or telephonic notice (in
the case of telephonic notice, to be promptly confirmed in writing) within the notice period and in
the form which would be required to be given to the Canadian Administrative Agent in respect of the
category of Canadian Dollar Loan into which the outstanding Canadian Dollar Loan is to be converted
in accordance with the provisions of subsection 2.2 or 2.3, as applicable, provided that:

	 	(a)	 	no Canadian Dollar Prime Loan may be converted into a Bankers’
Acceptance when any Event of Default has occurred and is continuing;
	 
	 	(b)	 	each conversion to Bankers’ Acceptances shall be for an
aggregate amount of C$1,000,000 (and whole multiples of C$100,000 in excess
thereof), and each conversion to Canadian Dollar Prime Loans shall be in a
minimum aggregate amount of C$300,000; and
	 
	 	(c)	 	Bankers’ Acceptances may be converted only on the maturity date
of such Bankers’ Acceptances and, provided that, if less than all
Bankers’ Acceptances are converted, then after such conversion not less than
C$1,000,000 (and whole multiples of C$100,000 in excess thereof) shall remain
as Bankers’ Acceptances.

          2.5. Circumstances Making Bankers’ Acceptances Unavailable.

          (a) If the Canadian Administrative Agent determines in good faith, which determination shall
be final, conclusive and binding upon the Canadian Subsidiary Borrowers, and notifies the Canadian
Subsidiary Borrowers that, by reason of circumstances affecting the money market, there is no
market for Bankers’ Acceptances, then:

     (i) the right of the Canadian Subsidiary Borrowers to request a borrowing by way of
Bankers’ Acceptance shall be suspended until the Canadian Administrative Agent determines
that the circumstances causing such suspension no longer exist and the Canadian
Administrative Agent so notifies the Canadian Subsidiary Borrowers; and

     (ii) any notice relating to a borrowing by way of Bankers’ Acceptance which is
outstanding at such time shall be deemed to be a notice requesting a borrowing by way of
Canadian Dollar Prime Loans (all as if it were a notice given pursuant to subsection 2.2).

          (b) The Canadian Administrative Agent shall promptly notify the Canadian Subsidiary Borrowers
and the Canadian Dollar Lenders of the suspension of the Canadian Subsidiary Borrowers’ right to
request a borrowing by way of Bankers’ Acceptance and of the termination of such suspension.

          2.6. Swing Line Commitments. (a) Subject to the terms and conditions hereof, from time to time prior to the Revolving
Credit Termination Date (i) the Canadian Dollar Swing Line Lender severally (but not jointly)
agrees to make Canadian Dollar Swing Line Loans to the Canadian Subsidiary Borrowers in Canadian
Dollars in an aggregate principal amount not to exceed the Canadian Dollar equivalent of
U.S.$15,000,000 at any one time outstanding (each of the foregoing individually, a “Canadian
Dollar Swing Line Loan”; collectively the “Canadian Dollar Swing Line Loans”);
provided that, after giving effect to the making of any such Canadian Dollar Swing Line
Loans, the aggregate principal amount of Swing Line Loans under any Revolving Facility at any one
time outstanding shall not exceed

 

12

U.S.$100,000,000 and the Aggregate Canadian Revolving Extensions
of Credit shall not exceed the Canadian Commitments. All Canadian Dollar Swing Line Loans shall be
made as Canadian Dollar Prime Loans. The relevant Canadian Subsidiary Borrowers shall give the
Canadian Administrative Agent irrevocable notice (which notice must be received by the Canadian
Administrative Agent at or prior to 1:00 P.M., Toronto time, on the requested Borrowing Date),
specifying the amount of each requested Canadian Dollar Swing Line Loan, which shall be greater
than or equal to a minimum amount to be agreed upon by such Canadian Subsidiary Borrowers and the
relevant Canadian Dollar Swing Line Lender. Upon such notice, the Canadian Administrative Agent
shall promptly notify the Canadian Dollar Swing Line Lender thereof. The Canadian Dollar Swing
Line Lender shall make the amount of each borrowing available to the applicable Canadian Subsidiary
Borrowers in the manner directed by the Canadian Administrative Agent on the requested Borrowing
Date.

          (b) The Canadian Dollar Swing Line Lender in its sole and absolute discretion, may, on behalf
of the applicable Canadian Subsidiary Borrower (which hereby irrevocably directs the Canadian
Dollar Swing Line Lender to act on its behalf), request each Canadian Dollar Lender, including the
Canadian Dollar Swing Line Lender, with respect to all other Canadian Dollar Swing Line Loans, to
make a Canadian Dollar Prime Loan, in an amount equal to such Canadian Dollar Lender’s Revolving
Percentage under the Canadian Facility of the amount of the Canadian Dollar Swing Line Loans (the
“Refunded Canadian Dollar Swing Line Loans”) outstanding on the date such notice is given.
Unless any of the events described in paragraph (f) of Section 8 of the Credit Agreement shall have
occurred (in which event the procedures of paragraph (c) of this subsection 2.6 shall apply), each
Canadian Dollar Lender shall make the proceeds of its Canadian Dollar Prime Loan available to the
Canadian Administrative Agent for the account of the Canadian Dollar Swing Line Lender, at the
office of the Canadian Administrative Agent prior to 12:00 Noon (Toronto time) in funds immediately
available on the Business Day (Canada) next succeeding the date such notice is given. The proceeds
of such Canadian Dollar Prime Loans shall be immediately applied to repay the Refunded Canadian
Dollar Swing Line Loans.

          (c) If, prior to the making of a Canadian Swing Line Loan pursuant to paragraph (b) of
subsection 2.6, one of the events described in paragraph (f) of Section 8 of the Credit Agreement
shall have occurred, each Canadian Dollar Lender hereby agrees to and will, on the date such
Canadian Swing Line Loan was to have been made, purchase an undivided participating interest in
each Refunded Canadian Dollar Swing Line Loan in an amount equal to its Revolving Percentage under
the Canadian Facility of such Refunded Canadian Dollar Swing Line Loan. Such Revolving Credit
Lender will immediately transfer to the Canadian Administrative Agent for the account of the
Canadian Dollar Swing Line Lender, in immediately available funds of the amount of its
participations and, upon its receipt of its ratable share thereof, the Canadian Dollar Swing Line
Lender will deliver to such Canadian Dollar Lender a Swing Line Loan Participation Certificate
dated the date of receipt of such funds and in such amount.

          (d) Whenever, at any time after the Canadian Dollar Swing Line Lender has received from any
Canadian Dollar Lender such Canadian Dollar Lender’s participating interest in a Refunded Canadian
Dollar Swing Line Loan and the Canadian Dollar Swing Line Lender receives any payment on account
thereof, the Canadian Dollar Swing Line Lender will distribute to such Canadian Dollar Lender
through the Canadian Administrative Agent its participating interest; provided,
however, that in the event that such payment received by the Canadian Dollar Swing Line
Lender is required to be returned, such Canadian Dollar Lender will return to the Canadian Dollar
Swing Line Lender through the Canadian Administrative Agent any portion thereof previously
distributed by the Canadian Dollar Swing Line Lender to it.

          2.7. Participation. Each Canadian Dollar Lender’s obligation to purchase participating interests pursuant to
paragraph (c) of subsection 2.6 shall be absolute and unconditional and shall not be affected by
any circumstances, including, without limitation, (a) any set-off, counterclaim, recoupment,

 

13

defense or other right which such Canadian Dollar Lender may have against the Canadian
Dollar Swing Line Lender, any Canadian Subsidiary Borrower or any other Person for any reason
whatsoever; (b) the occurrence or continuance of an Event of Default; (c) any adverse change in the
condition (financial or otherwise) of the Borrower or any Canadian Subsidiary Borrower; (d) any
breach of the Credit Agreement by the Borrower, any Subsidiary Borrower or any other Revolving
Credit Lender; or (e) any other circumstance, happening or event whatsoever, whether or not similar
to any of the foregoing. Notwithstanding the foregoing, no Canadian Dollar Lender shall have any
obligation to purchase participating interests pursuant to paragraph (c) of subsection 2.6 or to
make any Refunded Canadian Dollar Swing Line Loans in respect of any Canadian Dollar Swing Line
Loan which was made at any time following receipt by the Canadian Administrative Agent of a notice
from any Canadian Dollar Lender specifying that (x) a Default or Event of Default has occurred and
is continuing and (y) explicitly stating that such Canadian Dollar Lender will not purchase such
participating interests or make Refunded Canadian Dollar Swing Line Loans with respect to Canadian
Dollar Swing Line Loans made after the date of receipt of such notice.

     2.8. Repayment of Canadian Dollar Loans; Evidence of Debt. (a) Each Canadian Dollar
Subsidiary Borrower hereby unconditionally promises to pay to the Canadian Administrative Agent for
the account of each Canadian Dollar Lender (i) then unpaid principal amount of each Canadian Dollar
Loan of such Canadian Dollar Lender on the Revolving Credit Termination Date (or such earlier date
on which the Loans become due and payable pursuant to Section 8 of the Credit Agreement) and (ii)
then unpaid principal amount of the Canadian Dollar Swing Line Loans of the Canadian Dollar Swing
Line Lender on the Revolving Credit Termination Date (or such earlier date on which the Canadian
Dollar Swing Line Loans become due and payable pursuant to Section 8 of the Credit Agreement).
Each Canadian Subsidiary Borrower hereby unconditionally promises to pay to the Canadian
Administrative Agent for the account of such Lender (i) then unpaid principal amount of each Loan
to such Subsidiary Borrower on the Revolving Credit Termination Date (or such earlier date on which
the Revolving Credit Loans become due and payable pursuant to Section 8 of the Credit Agreement)
and (ii) then unpaid principal amount of the Canadian Dollar Swing Line Loans to such Subsidiary
Borrower of the Canadian Dollar Swing Line Lender on the Revolving Credit Termination Date (or such
earlier date on which the Canadian Dollar Swing Line Loans became due and payable pursuant to
Section 8 of the Credit Agreement). Each Canadian Subsidiary Borrower hereby further agrees to pay
interest on the unpaid principal amount of the Canadian Dollar Loans from time to time outstanding
to such Canadian Subsidiary Borrower from the date hereof until payment in full thereof at the
rates per annum, and on the dates, set forth in subsection 2.14.

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

     (c) The Canadian Administrative Agent shall maintain a register (the “Canadian
Register”) in respect of the Canadian Facility in a manner similar to the Register described in
Section 10.6(b)(iv) of the Credit Agreement, and a subaccount therein for each Canadian Dollar
Lender, in which shall be recorded (i) the amount of each Canadian Dollar Loan made hereunder and
the type thereof, (ii) the amount of any principal or interest due and payable or to become due and
payable from any Canadian Subsidiary Borrower to each Canadian Dollar Lender hereunder and (iii)
both the amount of any sum
received by the Canadian Administrative Agent hereunder from any Canadian Subsidiary Borrower
and each Canadian Dollar Lender’s share thereof.

 

14

     (d) The entries made in the Canadian Register and the accounts of each Canadian Dollar Lender
maintained pursuant to subsection 2.8(b) shall, to the extent permitted by applicable law, be
prima facie evidence of the existence and amounts of the obligations of each
Canadian Subsidiary Borrower therein recorded; provided, however, that the failure
of any Canadian Dollar Lender or the Canadian Administrative Agent to maintain the Canadian
Register or any such account, or any error therein, shall not in any manner affect the obligation
of any Canadian Subsidiary Borrower to repay (with applicable interest) the Canadian Dollar Loans
made to such Canadian Subsidiary Borrower by such Canadian Dollar Lender in accordance with the
terms of the Credit Agreement.

     2.9. Termination or Reduction of the Canadian Commitments .

     (a) Optional. The Canadian Subsidiary Borrowers shall have the right, upon not less
than five Business Days’ (Canada) written notice to the Canadian Administrative Agent, to terminate
the Canadian Commitments or, from time to time, reduce the amount of the Canadian Commitments,
provided that (i) any such reduction shall be accompanied by prepayment of the Canadian
Dollar Loans by the relevant Canadian Subsidiary Borrower, together with accrued interest on the
amount so prepaid to the date of such prepayment, to the extent, if any, the Available Canadian
Commitments would be negative, (ii) any such termination of the Canadian Commitments shall be
accompanied by (A) prepayment in full of the Canadian Dollar Loans then outstanding hereunder, (B)
cash collateralization of all Canadian L/C Obligations then outstanding in accordance with the
provisions of subsection 2.13, and (C) payment of accrued interest thereon to the date of such
prepayment and the payment of any unpaid fees then accrued hereunder (including, without
limitation, in respect of any Canadian Letters of Credit) and (iii) any termination of the Canadian
Commitments while Bankers’ Acceptances are outstanding under the Canadian Commitments and any
reduction of the aggregate amount of the Canadian Commitments that reduces the amount of the
Canadian Commitments below the principal amount of the Bankers’ Acceptances then outstanding may be
made only on the maturity date of any such Bankers’ Acceptance. Upon receipt of such notice, the
Canadian Administrative Agent shall promptly notify each Canadian Dollar Lender thereof. Any such
reduction shall be in an amount of C$300,000 or a whole multiple of C$100,000 in excess thereof and
shall reduce permanently the amount of the Canadian Commitments then in effect.

     (b) Mandatory. The Revolving Credit Commitments shall automatically terminate on the
Revolving Credit Termination Date and all Canadian Dollar Loans shall be repaid and to the extent
any Canadian Letter of Credit remains outstanding after the Revolving Credit Termination Date, the
Canadian Subsidiary Borrowers shall cash collateralize such Canadian L/C Obligations (and the fees
thereon) in accordance with the provisions of subsection 2.13. The Revolving Credit Commitments
shall also be reduced in accordance with subsection 2.12.

     2.10. Optional Prepayments. Any Canadian Subsidiary Borrower may, at any time and from
time to time, prepay the Canadian Dollar Loans made to it hereunder, in each case in whole or in
part, without premium or penalty, upon at least one Business Day’s (Canada) irrevocable notice to
the Canadian Administrative Agent, specifying the date and amount of prepayment. If such notice is
given, the relevant Canadian Subsidiary Borrower shall make such prepayment and the payment amount
specified in such notice shall be due and payable on the date specified therein, together with
accrued interest to such date on the
amount prepaid. Partial prepayments shall be in an aggregate principal amount of C$300,000 or
a whole multiple of C$100,000 in excess thereof. Notwithstanding anything to the contrary above,
Canadian Dollar Loans consisting of Bankers’ Acceptances may not be prepaid pursuant to this
subsection.

     2.11.Mandatory Prepayments. The Canadian Subsidiary Borrowers, without notice or demand,
shall immediately prepay the Canadian Dollar Loans (or, in the case of Bankers’ Acceptances,

 

15

cash
collateralize such Bankers’ Acceptances), to the extent, if any, that the Available Canadian
Commitments are negative, together with accrued interest to the date of such prepayment on the
amount so prepaid; provided that if such prepayment is required solely as a result of a
change in the aggregate Dollar Equivalent (Canada) of the Canadian Dollar Loans, no prepayment
shall be made unless such prepayment is required pursuant to subsection 2.19.

     2.12. Cash Collateralization of Canadian Letters of Credit. To the extent that at any time
and from time to time, the Canadian L/C Obligations exceed the amount of the Canadian L/C
Commitments or the Canadian L/C Obligations exceed the Canadian Commitments (whether pursuant to
subsections 2.10, 2.11, 2.12 or otherwise), the Canadian Subsidiary Borrowers shall cash
collateralize (in a manner reasonably satisfactory to the Canadian Administrative Agent) such
portion of the Canadian L/C Obligations (and the fees thereon through the stated expiration date of
the Canadian Letters of Credit giving rise to such Canadian L/C Obligations) which is in excess of
the Canadian L/C Commitments or such Canadian Commitments, as applicable.

     2.13. Interest Rate and Payment Dates.

     (a) Subject to subsection 2.13(b) below, each Canadian Dollar Prime Loan shall bear interest
at a rate per annum equal to the Canadian Dollar Prime Rate plus the Applicable Margin for Canadian
Borrowing.

     (b) Each Canadian Subsidiary Borrower hereby promises to pay to the Canadian Administrative
Agent for the account of each applicable Canadian Dollar Lender interest at the applicable
Post-Default Rate (x) on any principal of any Canadian Dollar Loan made by such Canadian Dollar
Lender and on any other amount payable by such Canadian Subsidiary Borrower hereunder to or for
account of such Canadian Dollar Lender, that shall not be paid in full when due (whether at stated
maturity, by acceleration, by mandatory prepayment or otherwise), for the period from and including
the due date thereof but excluding the date the same is paid in full and (y) during any period when
an Event of Default shall have occurred under Section 8(a) of the Credit Agreement and for so long
as such Event of Default shall be continuing, on any principal of any Canadian Dollar Loan made by
such Canadian Dollar Lender.

     (c) Accrued interest on each Canadian Dollar Prime Loan shall be calculated monthly and
payable quarterly in arrears, and in any event, upon the payment or prepayment thereof, but only on
the principal so paid or prepaid; provided that interest payable after the occurrence of a
Default at the Post-Default Rate shall be payable from time to time on demand of the Canadian
Administrative Agent or the Canadian Dollar Lenders having greater than 50% of the aggregate amount
of the Canadian Commitments. Promptly after the determination of any interest rate provided for
herein or any change therein, the Canadian Administrative Agent shall notify the Canadian Dollar
Lenders and the Canadian Borrower thereof.

     (d) Interest in respect of Canadian Dollar Prime Loans (and all other amounts denominated in
Canadian Dollars) shall be payable in Canadian Dollars and shall be payable based upon a year of
365 days.

     (e) (i) If any provision of this Annex D would obligate any party to the Credit Agreement to
make any payment of interest or other amount payable to any Canadian Dollar Lender in an amount or
calculated at a rate which would be prohibited by law or would result in a receipt by such Canadian
Dollar Lender of “interest” at a “criminal rate” (as such terms are construed under the
Criminal Code (Canada)), then notwithstanding such provision, such amount or rate shall be
deemed to have been adjusted with retroactive effect to the maximum amount or rate of interest, as
the case may be, as would

 

16

not be so prohibited by law or so result in a receipt by such Canadian
Dollar Lender of “interest” at a “criminal rate,” such adjustment to be effected, to the extent
necessary, as follows:

	 	(x)	 	first, by reducing the amount or rates of interest required to
be paid under this subsection 2.13; and
	 
	 	(y)	 	thereafter, by reducing any fees, commissions, premiums and
other amounts which would constitute interest for purposes of Section 347 of
the Criminal Code (Canada).

     (ii) If, notwithstanding the provisions of clause (i) of this subsection 2.13(e), and after
giving effect to all adjustments contemplated thereby, any Canadian Dollar Lender shall have
received an amount in excess of the maximum permitted by such clause, then the party having paid
such amount shall be entitled, by notice in writing to such Canadian Dollar Lender, to obtain
reimbursement from such Canadian Dollar Lender of an amount equal to such excess, and, pending such
reimbursement, such amount shall be deemed to be an amount payable by such Canadian Dollar Lender
to such party.

     (f) Any amount or rate of interest referred to in this subsection 2.13(e) shall be determined
in accordance with generally accepted actuarial practices and principles as an effective annual
rate of interest over the term of any Canadian Dollar Loan on the assumption that any charges, fees
or expenses that fall within the meaning of “interest” (as defined in the Criminal Code
(Canada)) shall, if they relate to a specific period of time, be prorated over that period of time
and otherwise be prorated over the period from the Closing Date to the Revolving Credit Commitment
Termination Date and, in the event of dispute, a certificate of a Fellow of the Canadian Institute
of Actuaries appointed by the Canadian Administrative Agent shall be conclusive for the purposes of
such determination absent manifest error.

     2.14. Computation of Interest and Fees. For the purposes of the Interest Act
(Canada), in any case in which an interest rate is stated in this Annex D to be calculated on the
basis of a year of 360 days or 365 days, as the case may be, the yearly rate of interest to which
such interest rate is equivalent is equal to such interest rate multiplied by the number of days in
the year in which the relevant interest payment accrues and divided by 360 or 365, respectively.
In addition, the principles of deemed investment of interest do not apply to any interest
calculations under this Annex D and the rates of interest stipulated in this Annex D are intended
to be nominal rates and not effective rates or yields.

     2.15. Pro Rata Treatment and Payments. (a) Each borrowing by any Canadian Subsidiary Borrower
from the Canadian Dollar Lenders hereunder, each payment by any Canadian Subsidiary Borrower on
account of any commitment fee or Acceptance Fee
hereunder and any reduction of the Canadian Commitments of the Canadian Dollar Lenders shall be
made ratably according to each Lender’s respective share of the Canadian Commitments. Each payment
by any Canadian Subsidiary Borrower on account of principal of and interest on the Canadian Dollar
Loans shall be made ratably according to the respective outstanding principal amounts of the
relevant Canadian Dollar Loans then held by the relevant Canadian Dollar Lenders. All payments
(including prepayments) to be made by any Canadian Subsidiary Borrower hereunder, whether on
account of principal, interest, fees or otherwise, shall be made without set off or counterclaim
and shall be made prior to 11:00 A.M., Toronto time, on the due date thereof to the Canadian
Administrative Agent, for the account of the Canadian Dollar Lenders, at the Canadian
Administrative Office in Canadian Dollars and in immediately available funds. The Canadian
Administrative Agent shall distribute such payments to the Canadian Dollar Lenders promptly upon
receipt in like funds as received, but the relevant Canadian Subsidiary Borrower shall have
satisfied its payment obligation hereunder upon payment to the Canadian Administrative Agent,
regardless of whether such Canadian Administrative Agent distributes such payments as required
hereunder. If any

 

17

payment hereunder becomes due and payable on a day other than a Business Day
(Canada), such payment shall be extended to the next succeeding Business Day (Canada), and, with
respect to payments of principal, interest thereon shall be payable at the then applicable rate
during such extension.

     (b) Unless the Canadian Administrative Agent shall have received notice from a Canadian
Dollar Lender prior to 11:00 A.M., Toronto time, on any Borrowing Date (Canada) that such Lender
will not make available to the Canadian Administrative Agent such Canadian Dollar Lender’s share of
the borrowing requested to be made on such Borrowing Date (Canada), the Canadian Administrative
Agent may assume that such Canadian Dollar Lender has made its share of such borrowing available to
the Canadian Administrative Agent on such Borrowing Date (Canada), and the Canadian Administrative
Agent may, in reliance upon such assumption, make available to the relevant Canadian Subsidiary
Borrower on such Borrowing Date (Canada) a corresponding amount. If such amount is not so made
available to the Canadian Administrative Agent by such Canadian Dollar Lender on such Borrowing
Date (Canada), the Canadian Administrative Agent shall also be entitled to recover such amount with
interest thereon at the rate per annum applicable to the Canadian Dollar Prime Rate determined for
such day plus 1%, on demand, from the relevant Canadian Dollar Lender. Nothing contained in this
subsection 2.15(b) shall relieve any Canadian Dollar Lender which has failed to make available its
share of any borrowing hereunder from its obligation to do so in accordance with the terms hereof
or prejudice any rights which any Canadian Subsidiary Borrower may have against any Canadian Dollar
Lender as a result of any default by such Canadian Dollar Lender to make Canadian Dollar Loans.

     (c) The failure of any Canadian Dollar Lender to make the Canadian Dollar Loan to be made by
it on any Borrowing Date (Canada) shall not relieve any other Canadian Dollar Lender of its
obligation, if any, hereunder to make its Canadian Dollar Loan on such Borrowing Date (Canada), but
no Canadian Dollar Lender shall be responsible for the failure of any other Canadian Dollar Lender
to make the Canadian Dollar Loan to be made by such other Canadian Dollar Lender on such Borrowing
Date (Canada).

     2.16. Requirements of Law.

     (a) If the adoption of or any change in any Requirement of Law regarding capital adequacy or
in the interpretation or application thereof by any Governmental Authority or compliance by any
Canadian Dollar Lender or any corporation controlling such Canadian Dollar Lender with any request
or directive regarding capital adequacy (whether or not having the force of law) from any
Governmental Authority made subsequent to the date hereof shall have the effect of reducing the
rate of return on such
Canadian Dollar Lender’s or such corporation’s capital as a consequence of its obligations
hereunder to a level below that which such Canadian Dollar Lender or such corporation could have
achieved but for such adoption, change or compliance (taking into consideration such Lender’s or
such corporation’s policies with respect to capital adequacy) by an amount deemed by such Canadian
Dollar Lender to be material, then from time to time, the relevant Canadian Subsidiary Borrower
shall promptly pay to such Canadian Dollar Lender, upon written demand therefor, such additional
amount or amounts as will compensate such Canadian Dollar Lender for such reduced rate of return.
In determining such additional amounts, each Canadian Dollar Lender will act reasonably and in good
faith and will use averaging and attribution methods which are reasonable and which will, to the
extent the reduced rate of return relates to such Canadian Dollar Lender’s loans or commitments in
general and are not specifically attributable to Canadian Dollar Loans or Canadian Commitments
hereunder, be calculated with respect to all loans or commitments similar to the Canadian Dollar
Loans or Canadian Commitments made by such Canadian Dollar Lender hereunder whether or not the loan
documentation for such other loans or commitments permits the Canadian Dollar Lender to charge the
respective borrower on a basis similar to that provided in this subsection 2.16.

 

18

     (b) If any Canadian Dollar Lender becomes entitled to claim any additional amounts pursuant
to this subsection, it shall promptly notify the relevant Canadian Subsidiary Borrower (with a copy
to the Canadian Administrative Agent) of the event by reason of which it has become so entitled. A
certificate as to any additional amounts payable pursuant to this subsection submitted by such
Canadian Dollar Lender to the relevant Canadian Subsidiary Borrower (with a copy to the Canadian
Administrative Agent), showing in reasonable detail the basis for the calculation thereof, shall be
prima facie evidence of such additional amounts payable. The agreements in this subsection shall
survive the termination of the Credit Agreement and the payment of the Canadian Dollar Loans and
all other amounts payable thereunder.

     2.17.
Taxes. All payments made by any Canadian Subsidiary Borrower in respect of
amounts owing under this Annex D shall be made free and clear of, and without deduction or
withholding for or on account of, any present or future income, stamp or other taxes, levies,
imposts, duties, charges, fees, deductions or withholdings, now or hereafter imposed, levied,
collected, withheld or assessed by any Governmental Authority, excluding gross or net income or
gross receipts taxes, ad valorem taxes, personal property and/or sales taxes and franchise taxes
(imposed in lieu of net income taxes) imposed on the Canadian Administrative Agent or any Canadian
Dollar Lender as a result of a present or former connection between the Canadian Administrative
Agent or such Canadian Dollar Lender and the jurisdiction of the Governmental Authority imposing
such tax or any political subdivision or taxing authority thereof or therein (other than any such
connection arising solely from the Canadian Administrative Agent or such Canadian Dollar Lender
having executed, delivered or performed its obligations or received a payment under, or enforced,
this Annex D). If any such non-excluded taxes, levies, imposts, duties, charges, fees, deductions
or withholdings (“Non-Excluded Taxes”) are required to be withheld from any amounts payable
to the Canadian Administrative Agent or any Canadian Dollar Lender hereunder, the amounts so
payable to the Canadian Administrative Agent or such Canadian Dollar Lender shall be increased to
the extent necessary to yield to the Canadian Administrative Agent or such Canadian Dollar Lender
(after payment of all Non-Excluded Taxes) interest or any such other amounts payable hereunder at
the rates or in the amounts specified in this Annex D, provided, however, that none
of the Canadian Subsidiary Borrowers shall be required to increase any such amounts payable to the
Canadian Administrative Agent, any Canadian Dollar Lender or any holder of Bankers’ Acceptances if
such increased amount arises as a result of the failure of such Canadian Dollar Lender, the
Canadian Administrative Agent or any holder of Bankers’ Acceptances to be a Person resident in
Canada for the purposes of the Income Tax Act (Canada) or an “authorized foreign bank”
under Section 2 of the Bank 
Act (Canada). The Canadian Subsidiary Borrowers shall also indemnify the Canadian
Administrative Agent and each Canadian Dollar Lender on an after-tax basis for any additional taxes
on net income which the Canadian Administrative Agent or such Canadian Dollar Lender, as the case
may be, may be obligated to pay as a result of the receipt of additional amounts under this
subsection 2.17. Whenever any Non-Excluded Taxes are payable by any Canadian Subsidiary Borrower,
as promptly as possible thereafter but in any event within 45 days after the date of payment such
Canadian Subsidiary Borrower shall send to the Canadian Administrative Agent for its own account or
for the account of such Canadian Dollar Lender, as the case may be, a certified copy of an original
official receipt received by such Canadian Subsidiary Borrower showing payment thereof. If any
Canadian Subsidiary Borrower fails to pay any Non-Excluded Taxes when due to the appropriate taxing
authority or fails to remit to the Canadian Administrative Agent the required receipts or other
required documentary evidence, such Canadian Subsidiary Borrower shall indemnify the Canadian
Administrative Agent and the Canadian Dollar Lenders for any incremental taxes, interest or
penalties that may become payable by the Canadian Administrative Agent or any Canadian Dollar
Lender as a result of any such failure. The agreements in this subsection shall survive the
termination of this Annex D and the payment of the Canadian Dollar Loans and all other amounts
payable hereunder.

 

19

     2.18. Use of Proceeds. The Canadian Facility and the proceeds of the Canadian Dollar Loans
shall be used by the Canadian Subsidiary Borrowers for working capital and other general corporate
purposes (which shall include any purpose expressly permitted by the Credit Agreement) of the
Canadian Subsidiary Borrowers; provided that, notwithstanding the foregoing, none of the
proceeds of the Canadian Dollar Loans may be used to finance any Hostile Take-Over Bid.

     2.19. Controls on Prepayment if Aggregate Revolving Extensions of Credit Exceed Aggregate
Revolving Credit Commitments. (a) The Canadian Subsidiary Borrowers will implement and
maintain internal controls to monitor the borrowings and repayments of Canadian Dollar Loans by the
relevant Canadian Subsidiary Borrowers and the issuance of and drawings under Canadian Letters of
Credit, with the object of preventing any request for an Extension of Credit that would result in
the Available Canadian Commitments becoming negative by more than 5% of the Canadian Commitments,
if such Commitments are negative by more than 5%, the Canadian Subsidiary Borrowers will promptly
notify the Canadian Administrative Agent.

     (b) The Canadian Administrative Agent will calculate the Available Canadian Commitments from
time to time, and in any event not less frequently than once during each calendar quarter. In
making such calculations, the Canadian Administrative Agent will rely on the information most
recently received by it from the Canadian Dollar Swing Line Lender in respect of outstanding
Canadian Dollar Swing Line Loans and from the Canadian Issuing Lender in respect of outstanding
Canadian L/C Obligations.

     (c) In the event that on any date the Canadian Administrative Agent calculates that (i) the
Available Canadian Commitments have become negative solely as a result of a change in the aggregate
Dollar Equivalent (Canada) of the Canadian Dollar Loans by more than 5%, the Canadian
Administrative Agent will give notice to such effect to the relevant Canadian Subsidiary Borrowers
and the Canadian Dollar Lenders. Within five Business Days (Canada) of receipt of any such notice,
such Canadian Subsidiary Borrower will, as soon as practicable but in any event within five
Business Days (Canada) of receipt of such notice, first, make such repayments or
prepayments of Canadian Dollar Prime Loans (together with interest accrued to the date of such
repayment or prepayment), second, pay any
Reimbursement Obligations under the Canadian Facility then outstanding, third, cash
collateralize any outstanding Bankers’ Acceptances, and fourth, cash collateralize any
outstanding Canadian L/C Obligations on terms reasonably satisfactory to the Canadian
Administrative Agent as shall be necessary to cause the Available Canadian Commitments not to be
negative.

     2.20. Lending Installations. (a) Subject to subsection 2.4 of the Credit Agreement and
subsections 2.1 and 2.6 of this Annex D, each Canadian Dollar Lender may book its Canadian Dollar
Loans at any Lending Installation selected by such Canadian Dollar Lender and may change its
Lending Installation from time to time; provided that such Lending Installation is an
Eligible Canadian Bank. All terms of the Credit Agreement shall apply to any such Lending
Installation and the Canadian Dollar Loans made hereunder shall be deemed held by each Canadian
Dollar Lender for the benefit of such Lending Installation. Each Canadian Dollar Lender may, by
written notice to the Canadian Administrative Agent and the Canadian Subsidiary Borrowers in
accordance with subsection 10.2 of the Credit Agreement and subject always to subsection 2.4 of the
Credit Agreement and subsections 2.1 and 2.6 of this Annex D designate replacement or additional
Lending Installations through which Canadian Dollar Loans will be made by it and for whose account
Canadian Dollar Loan payments are to be made.

     (b) Each Canadian Dollar Lender agrees that, upon the occurrence of any event giving rise to
the operation of subsection 2.16 or 2.17 with respect to such Canadian Dollar Lender, it will, if
requested by the Canadian Subsidiary Borrower, use reasonable efforts (subject to overall policy
considerations of such Canadian Dollar Lender) to designate another Lending Installation for any

 

20

Canadian Dollar Loans affected by such event with the object of avoiding the consequences of such
event; provided, that such designation is made on terms that, in the sole judgment of such
Canadian Dollar Lender, cause such Canadian Dollar Lender and any of its Lending Installations to
suffer no economic, legal or regulatory disadvantage, and provided, further, that
nothing in this subsection 2.20(b) shall affect or postpone any of the obligations of the Canadian
Subsidiary Borrowers or the rights of any Canadian Dollar Lender pursuant to subsection 2.16 or
2.17.

     2.21. Notices to Lenders. All notices under this Section 2 to Canadian Dollar Lenders by
the Canadian Subsidiary Borrowers or the Canadian Administrative Agent, and all payments by the
Canadian Administrative Agent to the Canadian Dollar Lenders, shall be made to the respective
Lending Installations of the Canadian Dollar Lenders maintaining the relevant Canadian Dollar Loans
or Canadian Commitments.

SECTION 3. LETTER OF CREDIT FACILITIES

     3.1. Canadian L/C Commitment. (a) Subject to the terms and conditions hereof, the
Canadian Issuing Lender, in reliance on the agreements of the other Lenders set forth in subsection
3.4(a), agrees to issue letters of credit (“Canadian Letters of Credit”) under the Canadian
Commitments for the account of any Canadian Subsidiary Borrower on any Business Day (Canada) during
the Revolving Credit Commitment Period in such form as may be approved from time to time by the
Canadian Issuing Lender; provided that the Canadian Issuing Lender shall not have any
obligation to issue any Canadian Letter of Credit if, after giving effect to such issuance, (i) the
Canadian L/C Obligations would exceed the Canadian L/C Commitment or (ii) the Available Canadian
Commitments would be negative. Each Canadian Letter of Credit shall (i) be denominated in Canadian
Dollars, (ii) be either (x) a standby letter of credit (a “Canadian Standby L/C”) issued to
support obligations of any Canadian Subsidiary Borrower, contingent
or otherwise, with an expiry date occurring not later than one year after such standby
Canadian L/C was issued (which expiry date may be subject to one or more automatic extensions of
one year or less unless 60-day notice, or such other notice as is satisfactory to the relevant
Canadian Subsidiary Borrower and the Canadian Issuing Lender, is given that any such extension
shall not be effective) or (y) a documentary letter of credit in respect of the purchase of goods
or services by any Canadian Subsidiary Borrower in the ordinary course of business with an expiry
date occurring not later than one year after such documentary letter of credit was issued and, in
the case of any such documentary letter of credit which is to be accepted by the Canadian Issuing
Lender pending payment at a date after presentation of sight Drafts, with a payment date no more
than one year after such Drafts were presented for acceptance (a “Canadian Trade L/C”) and
(iii) expire no later than five days before the Revolving Credit Termination Date.

     (b) Each Canadian Standby L/C shall be subject to the International Standby Practices and
each Canadian Trade L/C shall be subject to the Uniform Customs and, in each case, to the extent
not inconsistent therewith, the laws of the State of New York.

     (c) The Canadian Issuing Lender shall at no time be obligated to issue any Canadian Letter of
Credit hereunder if such issuance would conflict with, or cause the Canadian Issuing Lender or any
Canadian L/C Participant to exceed any limits imposed by, any applicable Requirement of Law.

     3.2. Procedure for Issuance of Letters of Credit. Any Canadian Subsidiary Borrower may
from time to time request that the Canadian Issuing Lender issue a Canadian Letter of Credit by
delivering to the Canadian Issuing Lender (with a copy to the Canadian Administrative Agent) at its
address for notices specified herein an Application therefor, completed to the satisfaction of the
Canadian Issuing Lender, and such other certificates, documents and other papers and information as
the Canadian Issuing Lender may reasonably request. Upon receipt of any Application, the Canadian
Issuing Lender

 

21

will process such Application and the certificates, documents and other papers and
information delivered to it in connection therewith in accordance with its customary procedures and
shall promptly issue the Canadian Letter of Credit requested thereby (but in no event shall the
Canadian Issuing Lender be required to issue any Canadian Letter of Credit earlier than four
Business Days (Canada) after its receipt of the Application therefor and all such other
certificates, documents and other papers and information relating thereto) by issuing the original
of such Canadian Letter of Credit to the beneficiary thereof or as otherwise may be agreed by the
Canadian Issuing Lender and any relevant Canadian Subsidiary Borrower. The Canadian Issuing Lender
shall furnish a copy of such Canadian Letter of Credit to the relevant Canadian Subsidiary Borrower
and to the Canadian Administrative Agent promptly following the issuance thereof.

     3.3. Fees, Commissions and Other Charges. (a) The relevant Canadian Subsidiary Borrower
shall pay to the Canadian Administrative Agent, for the ratable account of the Canadian Issuing
Lender and the Canadian L/C Participants, a letter of credit commission in Canadian Dollars with
respect to each Canadian Trade L/C issued by the Canadian Issuing Lender (i) in an amount equal to
the Dollar Equivalent (Canada) of such issuance and payment fees as have been agreed upon by the
relevant Canadian Subsidiary Borrower and the Canadian Issuing Lender and (ii) in an amount equal
to the product of, on the date on which such commission is calculated, (A) the rate per annum equal
to the Applicable Margin in respect of Canadian Dollar Prime Loans and (B) the aggregate amount
available to be drawn under each Canadian Letter of Credit (plus an additional 1/4 of 1% per annum
which shall be payable for the account of the Canadian Issuing Lender). Such letter of credit
commissions shall be payable in arrears on the last day of each March, June, September and December
and shall be nonrefundable.

     (b) The relevant Canadian Subsidiary Borrower shall pay to the Canadian Administrative Agent,
for the ratable account of the Canadian Issuing Lender and the Canadian L/C Participants, a letter
of credit commission in Canadian Dollars with respect to each Canadian Standby L/C issued by the
Canadian Issuing Lender, computed for the period from the date of such payment to the date upon
which the next such payment is due hereunder in an amount equal to the product of (i) the rate
equal to the Applicable Margin in respect of Canadian Dollar Prime Loans in effect on the date on
which such commission is calculated and (ii) the aggregate amount available to be drawn under such
Canadian Standby L/C on the date on which such commission is calculated (plus an additional 1/4 of 1%
per annum which shall be payable for the account of the Canadian Issuing Lender). The relevant
Canadian Subsidiary Borrower shall also pay to the Canadian Administrative Agent, for the account
of the Canadian Issuing Lender, such issuance fees as have been agreed upon by the relevant
Canadian Subsidiary Borrower and the Canadian Issuing Lender. Such letter of credit commissions
shall be payable in arrears on the last day of each March, June, September and December and shall
be nonrefundable.

     (c) In addition to the foregoing fees and commissions, the relevant Canadian Subsidiary
Borrower shall pay or reimburse the Canadian Issuing Lender for such normal and customary costs and
expenses as are incurred or charged by the Canadian Issuing Lender in issuing, effecting payment
under, amending or otherwise administering any Canadian Letter of Credit issued by it.

     (d) The Canadian Administrative Agent shall, promptly following its receipt thereof,
distribute to the Canadian Issuing Lender and the Canadian L/C Participants all fees and
commissions received by the Canadian Administrative Agent for their respective accounts pursuant to
this subsection 3.3.

     3.4. Canadian L/C Participation. (a) The Canadian Issuing Lender irrevocably agrees to
grant and hereby grants to each Canadian L/C Participant, and, to induce the Canadian Issuing
Lender to

 

22

issue Canadian Letters of Credit hereunder, each such Canadian L/C Participant
irrevocably agrees to accept and purchase and hereby accepts and purchases from the Canadian
Issuing Lender, on the terms and conditions hereinafter stated, for such Canadian L/C Participant’s
own account and risk an undivided interest equal to such Canadian L/C Participant’s ratable share
of the Canadian Facility in the Canadian Issuing Lender’s obligations and rights under each
Canadian Letter of Credit issued hereunder and the amount of each Draft paid by the Canadian
Issuing Lender thereunder. Each such Canadian L/C Participant unconditionally and irrevocably
agrees with the Canadian Issuing Lender that, if a Draft is paid under any such Canadian Letter of
Credit for which the Canadian Issuing Lender is not reimbursed in full by the relevant Canadian
Subsidiary Borrower in accordance with the terms of the Credit Agreement (including this Annex D),
such Canadian L/C Participant shall pay to the Canadian Issuing Lender upon demand at the Canadian
Issuing Lender’s address for notices specified herein an amount equal to such Canadian L/C
Participant’s ratable share of the Canadian Facility of the amount of such Draft, or any part
thereof, which is not so reimbursed.

     (b) If any amount required to be paid by any Canadian L/C Participant to the Canadian Issuing
Lender pursuant to subsection 3.4(a) in respect of any unreimbursed portion of any payment made by
the Canadian Issuing Lender under any Canadian Letter of Credit is not paid to the Canadian Issuing
Lender within three Business Days (Canada) after the date such payment is due, such Canadian L/C
Participant shall pay to the Canadian Issuing Lender on demand an amount equal to the product of
(i) such amount, times (ii) the prevailing customary rate for Canadian interbank
transactions, as quoted by the Canadian Issuing Lender, during the period from and including the
date such payment is required to the date on which such payment is immediately available to the
Canadian Issuing Lender, times (iii) a
fraction the numerator of which is the number of days that elapse during such period and the
denominator of which is 365. If any such amount required to be paid by any such Canadian L/C
Participant pursuant to subsection 3.4(a) is not in fact made available to the Canadian Issuing
Lender by such Canadian L/C Participant within three Business Days (Canada) after the date such
payment is due, the Canadian Issuing Lender shall be entitled to recover from such Canadian L/C
Participant, on demand, such amount with interest thereon calculated from such due date at the rate
per annum applicable to the prevailing customary rate for Canadian interbank transactions, as
quoted by the Canadian Issuing Lender. A certificate of the Canadian Issuing Lender submitted to
any Canadian L/C Participant with respect to any amounts owing under this subsection shall be
conclusive in the absence of manifest error.

     (c) Whenever, at any time after the Canadian Issuing Lender has made payment under any
Canadian Letter of Credit and has received from any Canadian L/C Participant its ratable share of
such payment in accordance with subsection 3.4(a), the Canadian Issuing Lender receives any payment
related to such Canadian Letter of Credit (whether directly from the relevant Canadian Subsidiary
Borrower or otherwise), or any payment of interest on account thereof, the Canadian Issuing Lender
will distribute to such Canadian L/C Participant its ratable share thereof; provided,
however, that in the event that any such payment received by the Canadian Issuing Lender
shall be required to be returned by the Canadian Issuing Lender, such Canadian L/C Participant
shall return to the Canadian Issuing Lender the portion thereof previously distributed by the
Canadian Issuing Lender to it.

     3.5. Reimbursement Obligation of the Canadian Subsidiary Borrowers. The relevant Canadian
Subsidiary Borrower agrees to reimburse the Canadian Issuing Lender on each date on which the
Canadian Issuing Lender notifies such Canadian Subsidiary Borrower of the date and amount of a
Draft presented under any Canadian Letter of Credit and paid by the Canadian Issuing Lender for the
amount of (a) such Draft so paid and (b) any taxes (other than Excluded Taxes), fees, charges or
other costs or expenses incurred by the Canadian Issuing Lender in connection with such payment;
provided that upon the acceleration of such reimbursement obligations in accordance with
Section 8 of the Credit Agreement, the relevant Canadian Subsidiary Borrower agrees to reimburse
the Canadian Issuing Lender for the amount equal to then maximum liability (whether direct or
contingent) of the Canadian Issuing

 

23

Lender and the Canadian L/C Participants under such Canadian
Letter of Credit. Each such payment shall be made to the Canadian Issuing Lender, at its address
for notices specified herein in Canadian Dollars and in immediately available funds, on the date on
which the relevant Canadian Subsidiary Borrower receives such notice, if received prior to 10:00
A.M., Toronto time, on a Business Day (Canada) and otherwise on the next succeeding Business Day
(Canada).

     3.6. Obligations Absolute. Any relevant Canadian Subsidiary Borrower’s obligations under
this Section 3 shall be absolute and unconditional under any and all circumstances and irrespective
of any set-off, counterclaim or defense to payment which any relevant Canadian Subsidiary Borrower
may have or have had against the Canadian Issuing Lender or any beneficiary of a Canadian Letter of
Credit. Each Canadian Subsidiary Borrower also agrees with the Canadian Issuing Lender that the
Canadian Issuing Lender shall not be responsible for, and such relevant Canadian Subsidiary
Borrower’s Reimbursement Obligations under subsection 3.5 shall not be affected by, among other
things, the validity or genuineness of documents or of any endorsements thereon, even though such
documents shall in fact prove to be invalid, fraudulent or forged, or any dispute between or among
any relevant Canadian Subsidiary Borrower and any beneficiary of any Canadian Letter of Credit or
any other party to which such Canadian Letter of Credit may be transferred or any claims whatsoever
of the relevant Canadian Subsidiary Borrower against any beneficiary of such Canadian Letter of
Credit or any such transferee. The Canadian Issuing Lender shall not be liable for any error,
omission, interruption or delay in transmission, dispatch or delivery of
any message or advice, however transmitted, in connection with any Canadian Letter of Credit
issued by it, except for errors or omissions caused by the Canadian Issuing Lender’s gross
negligence or willful misconduct. Each Canadian Subsidiary Borrower agrees that any action taken
or omitted by the Canadian Issuing Lender under or in connection with any Canadian Letter of Credit
issued by it or the related Drafts or documents, if done in the absence of gross negligence or
willful misconduct and in accordance with the standards of care specified in the Uniform Commercial
Code of the State of New York, shall be binding on each Canadian Subsidiary Borrower and shall not
result in any liability of the Canadian Issuing Lender to any Canadian Subsidiary Borrower.

     3.7. Increased Costs. If the adoption of or any change in any law or regulation or in the
interpretation thereof after the date hereof by any court or administrative or Governmental
Authority charged with the administration thereof shall either (i) impose, modify or deem
applicable any reserve, special deposit or similar requirement against Canadian Letters of Credit
issued by the Canadian Issuing Lender or participated in by the Lenders or (ii) impose on any
Canadian Dollar Lender any other condition regarding any Canadian Letter of Credit, and the result
of any event referred to in clauses (i) or (ii) above shall be to increase the cost to the Canadian
Issuing Lender or any Canadian Dollar Lender of issuing or maintaining such Canadian Letter of
Credit (or its participation therein, as the case may be) (which increase in cost shall be the
result of the Canadian Issuing Lender’s or such Lender’s reasonable allocation of the aggregate of
such cost increases resulting from such events), then, upon notice to it from the Canadian Issuing
Lender or such Lender (with a copy to the Canadian Administrative Agent) certifying that (x) one of
the events herein above described has occurred and the nature of such event, (y) the increased cost
or reduced amount resulting from such event and (z) the additional amounts demanded by the Canadian
Issuing Lender or such Lender, as the case may be, and a reasonably detailed explanation of the
calculation thereof, the relevant Canadian Subsidiary Borrower shall immediately pay to such
Canadian Issuing Lender or such Lender, as the case may be, from time to time as specified by the
Canadian Administrative Agent or such Canadian Dollar Lender, additional amounts which shall be
sufficient to compensate such Canadian Issuing Lender or such Canadian Dollar Lender for such
increased cost, together with interest on each such amount from the date demanded until payment in
full thereof at the rate provided in subsection 3.3. A certificate as to the fact and amount of
such increased cost incurred by the Canadian Issuing Lender or such Canadian Dollar Lender as a
result of any event mentioned in clauses (i) or (ii) above, submitted by the Canadian Issuing
Lender or such Lender to such Canadian Subsidiary Borrower, shall be conclusive, absent manifest
error.

 

24

     3.8. Canadian Letter of Credit Payments. If any Draft in Canadian Dollars shall be
presented for payment under any Canadian Letter of Credit, the Canadian Issuing Lender shall
promptly notify the relevant Canadian Subsidiary Borrower and the Canadian Administrative Agent of
the date and amount of the Canadian Dollars thereof. The responsibility of the Canadian Issuing
Lender to the Canadian Subsidiary Borrowers in connection with any Draft presented for payment
under any Canadian Letter of Credit shall, in addition to any payment obligation expressly provided
for in such Canadian Letter of Credit, be limited to determining that the documents (including each
Draft) delivered under such Canadian Letter of Credit in connection with such presentment are in
conformity with such Canadian Letter of Credit.

     (a) Application. To the extent that any provision of any Application related to any
Canadian Letter of Credit is inconsistent with the provisions of the Credit Agreement, the
provisions of the Credit Agreement shall apply.

     (b) Purpose of the Letters of Credit. The Canadian Letters of Credit shall be used for
any lawful purposes requested by the Canadian Subsidiary Borrowers.

 

APPENDIX I

PRICING GRID FOR CANADIAN DOLLAR LOANS

	 	 	 	 	 
	 	 	Applicable
	 	 	Margin
	Leverage	 	Bankers’	 	Canadian Dollar
	Ratio 	 	Acceptances	 	Prime Rate Loans
	> 4.00 to 1.00
	 	1.500%	 	0.500%
	 
	 	 	 	 
	> 3.00 to 1.00
	 	1.250%	 	0.250%
	 
	 	 	 	 
	> 2.25 to 1.00
	 	1.000%	 	0.000%
	 
	 	 	 	 
	> 1.75 to 1.00
	 	0.875%	 	0.000%
	 
	 	 	 	 
	>1.25 to 1.00
	 	0.750%	 	0.000%
	 
	 	 	 	 
	> 1.25 to 1.00
	 	0.625%	 	0.000%

Changes in the Applicable Margin resulting from changes in the Leverage Ratio shall become
effective on the date (the “Adjustment Date”) on which financial statements are delivered to the
Lenders pursuant to subsection 6.1 (but in any event not later than the 45th day after
the end of each of the first three quarterly periods of each fiscal year of the Borrower or the
90th day after the end of each fiscal year of the Borrower, as the case may be) and
shall remain in effect until the next change to be effected pursuant to this paragraph. If any
financial statements referred to above are not delivered within the time periods specified above,
then, until such financial statements are delivered, the Leverage Ratio as at the end of the fiscal
period that would have been covered thereby shall for the purposes of this definition be deemed to
be greater than or equal to 3.25 to 1.00. In addition, at all times while an Event of Default
shall have occurred and be continuing, the Leverage Ratio shall for the purposes of this definition
be deemed to be greater than 3.25 to 1.00. Each determination of the Leverage Ratio pursuant to
this pricing grid shall be made with respect to (or, in the case of Average Total Indebtedness, as
at the end of) the period of four consecutive fiscal quarters of the Borrower ending at the end of
the period covered by the relevant financial statements.

 

Schedule 1

Lenders; Revolving Credit Commitments

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	Revolving Credit Commitments	 	 	Total Revolving	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	Facility B	 	 	Facility C	 	 	Facility D	 	 	Credit	 	 	Term	 	 	 	 
	Lenders	 	Facility A-1	 	 	Facility A-2	 	 	Sterling	 	 	Australia	 	 	Canada	 	 	Commitment	 	 	Commitments	 	 	Total Facilities	 
	JPMorgan Chase Bank, N.A.
	 	$	11,572,093.02	 	 	$	1,046,511.63	 	 	$	60,000,000.00	 	 	$	25,000,000.00	 	 	 	 	 	 	$	97,618,604.65	 	 	$	34,381,395.35	 	 	$	132,000,000.00	 
	Bank of America, N.A.
	 	 	37,618,604.65	 	 	 	 	 	 	 	60,000,000.00	 	 	 	 	 	 	 	 	 	 	 	97,618,604.65	 	 	 	34,381,395.35	 	 	 	132,000,000.00	 
	Citicorp North America, Inc.
	 	 	24,676,744.19	 	 	 	 	 	 	 	60,000,000.00	 	 	 	 	 	 	 	 	 	 	 	84,676,744.19	 	 	 	29,823,255.81	 	 	 	114,500,000.00	 
	CoBank, ACB
	 	 	191,909,302.33	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	191,909,302.33	 	 	 	67,590,697.67	 	 	 	259,500,000.00	 
	Bank of Tokyo-Mitsubishi UFJ, Ltd.
	 	 	68,037,209.30	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	68,037,209.30	 	 	 	23,962,790.70	 	 	 	92,000,000.00	 
	BNP Paribas
	 	 	43,037,209.30	 	 	 	 	 	 	 	25,000,000.00	 	 	 	 	 	 	 	 	 	 	 	68,037,209.30	 	 	 	23,962,790.70	 	 	 	92,000,000.00	 
	Bank of Montreal/Nesbitt Burns
	 	 	53,037,209.30	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	15,000,000.00	 	 	 	68,037,209.30	 	 	 	23,962,790.70	 	 	 	92,000,000.00	 
	Rabobank Nederland, New York Branch
	 	 	43,037,209.30	 	 	 	 	 	 	 	25,000,000.00	 	 	 	 	 	 	 	 	 	 	 	68,037,209.30	 	 	 	23,962,790.70	 	 	 	92,000,000.00	 
	The Bank of Nova Scotia
	 	 	53,037,209.30	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	15,000,000.00	 	 	 	68,037,209.30	 	 	 	23,962,790.70	 	 	 	92,000,000.00	 
	Lasalle National Bank
	 	 	48,037,209.30	 	 	 	 	 	 	 	15,000,000.00	 	 	 	 	 	 	 	5,000,000.00	 	 	 	68,037,209.30	 	 	 	23,962,790.70	 	 	 	92,000,000.00	 
	The Bank of New York
	 	 	55,465,116.28	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	55,465,116.28	 	 	 	19,534,883.72	 	 	 	75,000,000.00	 
	Calyon
	 	 	40,465,116.28	 	 	 	 	 	 	 	15,000,000.00	 	 	 	 	 	 	 	 	 	 	 	55,465,116.28	 	 	 	19,534,883.72	 	 	 	75,000,000.00	 
	Citizens Bank of Pennsylvania / RLOC
	 	 	35,465,116.28	 	 	 	 	 	 	 	20,000,000.00	 	 	 	 	 	 	 	 	 	 	 	55,465,116.28	 	 	 	19,534,883.72	 	 	 	75,000,000.00	 
	Fifth Third Bank
	 	 	55,465,116.28	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	55,465,116.28	 	 	 	19,534,883.72	 	 	 	75,000,000.00	 
	Mizuho Corporate Bank, Ltd.
	 	 	55,465,116.28	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	55,465,116.28	 	 	 	19,534,883.72	 	 	 	75,000,000.00	 
	Commerzbank AG
	 	 	24,372,093.02	 	 	 	 	 	 	 	20,000,000.00	 	 	 	 	 	 	 	 	 	 	 	44,372,093.02	 	 	 	15,627,906.98	 	 	 	60,000,000.00	 
	Fortis Financial Services LLC
	 	 	36,976,744.19	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	36,976,744.19	 	 	 	13,023,255.81	 	 	 	50,000,000.00	 
	National City Bank
	 	 	36,976,744.19	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	36,976,744.19	 	 	 	13,023,255.81	 	 	 	50,000,000.00	 
	Sumitomo Mitsui Banking Corporation
	 	 	36,976,744.19	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	36,976,744.19	 	 	 	13,023,255.81	 	 	 	50,000,000.00	 
	Bayerische
Landesbank, New York Branch
	 	 	36,976,744.19	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	36,976,744.19	 	 	 	13,023,255.81	 	 	 	50,000,000.00	 
	Comerica Bank
	 	 	29,581,395.35	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	29,581,395.35	 	 	 	10,418,604.65	 	 	 	40,000,000.00	 
	GreenStone
Farm Credit Services, ACA/FLCA
	 	 	—	 	 	 	25,883,720.93	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	25,883,720.93	 	 	 	9,116,279.07	 	 	 	35,000,000.00	 
	United Overseas Bank Ltd.
	 	 	—	 	 	 	22,186,046.51	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	22,186,046.51	 	 	 	7,813,953.49	 	 	 	30,000,000.00	 
	TD Banknorth, Inc.
	 	 	22,186,046.51	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	22,186,046.51	 	 	 	7,813,953.49	 	 	 	30,000,000.00	 
	Northern Trust Company
	 	 	18,488,372.09	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	18,488,372.09	 	 	 	6,511,627.91	 	 	 	25,000,000.00	 
	Peoples Bank
	 	 	18,488,372.09	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	18,488,372.09	 	 	 	6,511,627.91	 	 	 	25,000,000.00	 

1

 

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	Revolving Credit Commitments	 	 	Total Revolving	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	Facility B	 	 	Facility C	 	 	Facility D	 	 	Credit	 	 	Term	 	 	 	 
	Lenders	 	Facility A-1	 	 	Facility A-2	 	 	Sterling	 	 	Australia	 	 	Canada	 	 	Commitment	 	 	Commitments	 	 	Total Facilities	 
	The Governor and Company of the
Bank of Ireland
	 	 	18,488,372.09	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	18,488,372.09	 	 	 	6,511,627.91	 	 	 	25,000,000.00	 
	General Electric Capital Corporation
	 	 	18,488,372.09	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	18,488,372.09	 	 	 	6,511,627.91	 	 	 	25,000,000.00	 
	KBC Bank N.V.
	 	 	18,488,372.09	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	18,488,372.09	 	 	 	6,511,627.91	 	 	 	25,000,000.00	 
	State Bank of India
	 	 	—	 	 	 	11,093,023.26	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	11,093,023.26	 	 	 	3,906,976.74	 	 	 	15,000,000.00	 
	U.S. Bank National Association
	 	 	11,093,023.26	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	11,093,023.26	 	 	 	3,906,976.74	 	 	 	15,000,000.00	 
	E.Sun Commercial Bank, Ltd., Los
Angeles Branch
	 	 	—	 	 	 	7,395,348.84	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	7,395,348.84	 	 	 	2,604,651.16	 	 	 	10,000,000.00	 
	Hua Nan Commercial Bank, Ltd., Los
Angeles Branch
	 	 	—	 	 	 	7,395,348.84	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	7,395,348.84	 	 	 	2,604,651.16	 	 	 	10,000,000.00	 
	The Norinchukin Bank, New York
Branch
	 	 	7,395,348.84	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	7,395,348.84	 	 	 	2,604,651.16	 	 	 	10,000,000.00	 
	Chang Hwa Commercial Bank, Ltd.,
New York Branch
	 	 	3,697,674.42	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	3,697,674.42	 	 	 	1,302,325.58	 	 	 	5,000,000.00	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Total
	 	$	1,155,000,000.00	 	 	$	75,000,000.00	 	 	$	300,000,000.00	 	 	$	25,000,000.00	 	 	$	35,000,000.00	 	 	$	1,590,000,000.00	 	 	$	560,000,000.00	 	 	$	2,150,000,000.00	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 

2

 

Schedule 1.2

Non-Guarantor Domestic Subsidiaries

Scotts Global Services, Inc., an Ohio corporation (successor by merger to Scotts Global
Services, Inc., a Nevada corporation)

SMGM LLC, an Ohio limited liability company

SMG Brands, Inc., a Delaware corporation

 

Schedule 4.1

Certain Financial Information

Summary
of Current Interest Rate Swaps of The Scotts Miracle-Gro Company as of 2/7/2007

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Institution	 	Amount	 	 	Start Date	 	 	End Date	 	 	Rate Fixing	 
	Bank of Montreal
	 	£	14,400,000	 	 	15-Nov-05	 	15-Nov-08	 	 	4.76	%
	Bank of Tokyo
	 	 	14,400,000	 	 	15-Nov-05	 	15-Nov-08	 	 	4.76	%
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Total
	 	£	28,800,000	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Bank of Tokyo
	 	€	21,400,000	 	 	17-Nov-05	 	17-Nov-08	 	 	2.98	%
	Scotiabank
	 	 	21,400,000	 	 	17-Nov-05	 	17-Nov-08	 	 	2.98	%
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Total
	 	€	42,800,000	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Bank of America
	 	$	50,000,000	 	 	14-Feb-07	 	14-Feb-12	 	 	5.20	%
	Bank of Montreal
	 	 	50,000,000	 	 	14-Feb-07	 	14-Feb-12	 	 	5.20	%
	Rabobank
	 	 	50,000,000	 	 	14-Feb-07	 	14-Feb-12	 	 	5.20	%
	LaSalle Bank
	 	 	50,000,000	 	 	14-Feb-07	 	14-Feb-12	 	 	5.20	%
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Total
	 	$	200,000,000	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 

Summary of Current Currency Swaps of the Scotts Miracle-Gro Company (in 000’s)

None

Summary of Currency Forwards of The Scotts Miracle-Gro Company (in 000’s)

None

 

 

Summary
of Outstanding Letters of Credit for The Scotts Miracle-Gro Company

	 	 	 	 	 	 	 	 	 
	Letter’s of Credit	 	Amount	 	 	Maturity	 	Beneficiary
	B695412
	 	$	613,970	 	 	31-Oct-07	 	DIETHELM SCANSTYLE PTE LTD
	P200765
	 	 	602,500	 	 	30-Apr-08	 	THE HUNTINGTON NATIONAL BANK
	P218576
	 	 	260,000	 	 	30-Sep-07	 	LUMBERMENS MUTUAL CASUALTY COMPANY
	P224253
	 	 	10,302	 	 	01-May-08	 	OHIO ENVIRONMENTAL PROTECTION
	P234324
	 	 	145,809	 	 	28-Jan-08	 	STATE OF FLORIDA, DEPARTMENT OF
	P238657
	 	 	2,500,000	 	 	30-Sep-07	 	ARGONAUT INSURANCE CO.
	TBTI662029
	 	 	318,990	 	 	15-Apr-07	 	HANGZHOU TONNY ELECTRIC TOOLS
	IBTI659566
	 	 	189,104	 	 	28-Feb-07	 	RELEASE GARDEN VIETNAM BRANCH
	T217922
	 	 	450,000	 	 	30-Sep-07	 	CITY OF SPOKANE, SOLID WASTE
	T237913
	 	 	9,000	 	 	23-Nov-07	 	S.C. Dept of Health
	T244095
	 	 	333,240	 	 	19-Apr-07	 	OHIO ENVIRONMENTAL PROTECTION
	T296770
	 	 	450,000	 	 	30-Sep-07	 	CITY OF GREENSBORO
	431336002
	 	 	9,814,473	 	 	30-Sep-07	 	ACE American Insurance Co.
	 
	 	 	 	 	 	 	 
	TOTAL
	 	$	15,697,388	 	 	 	 	 

 

 

Schedule 4.5

Litigation

     The Scotts Miracle-Gro Company (the “Company”) is not presently aware of any
litigation which would constitute an exception to the representation contained in subsection 4.5.
However, the Company identifies in the Notes to its Consolidated Financial Statements and in its
filings with the Securities and Exchange Commission the more significant of its identified
contingencies, including certain lawsuits and administrative proceedings. The following details
the contingencies that were identified in the Company’s most recent Annual Report on Form 10-K
filed December 14, 2006, updated through January 29, 2007. As used herein, “we”, “us” and “our”
refers to the Company and its subsidiaries.

     ENVIRONMENTAL MATTERS

     In 1997, the Ohio Environmental Protection Agency initiated an enforcement action against the
Company with respect to alleged surface water violations and inadequate treatment capabilities at
the Marysville, Ohio facility and seeking corrective action under the federal Resource Conservation
and Recovery Act. The action related to discharges from on-site waste water treatment and several
discontinued on-site disposal areas.

     Pursuant to a Consent Order entered by the Union County, Ohio Common Pleas Court in 2002, the
Company is actively engaged in restoring the site to eliminate exposure to waste materials from the
discontinued on-site disposal areas.

     At September 30, 2006, $4.2 million was accrued for environmental and regulatory matters,
primarily related to the Marysville facility. Most of the accrued costs are expected to be paid in
fiscal 2007; however, payments could be made for a period thereafter. While the amounts accrued are
believed to be adequate to cover known environmental exposures based on current facts and estimates
of likely outcome, the adequacy of these accruals is based on several significant assumptions:

	 	•	 	that all significant sites that must be remediated have been identified;
	 
	 	•	 	that there are no significant conditions of contamination that are unknown to us; and
	 
	 	•	 	that with respect to the agreed judicial Consent Order in Ohio, the potentially
contaminated soil can be remediated in place rather than having to be removed and
only specific stream segments will require remediation as opposed to the entire
stream.

     If there is a significant change in the facts and circumstances surrounding these assumptions,
it could have a material impact on the ultimate outcome of these matters and our results of
operations, financial position and cash flows.

     LEGAL PROCEEDINGS

     As noted in the discussion above under “Environmental Matters”, we are involved in several
pending environmental matters. We believe that our assessment of contingencies is reasonable and
that related reserves, in the aggregate, are adequate; however, there can be no assurance that the
final resolution of these matters will not have a material adverse effect on our results of
operations, financial position and cash flows.

 

 

     Pending material legal proceedings are as follows:

U.S. Horticultural Supply, Inc. (F/K/A E.C. Geiger, Inc.)

     On November 5, 2004, U.S. Horticultural Supply, Inc. (“Geiger”) filed suit against the
Company in the U.S. District Court for the Eastern District of Pennsylvania. This complaint alleges
that the Company conspired with another distributor, Griffin Greenhouse Supplies, Inc., to restrain
trade in the horticultural products market, in violation of Section 1 of the Sherman Antitrust Act.
Geiger has not specified the amount of monetary damages it is seeking. On June 2, 2006, the Court
denied the Company’s motion to dismiss the complaint. The Company is currently engaged in discovery
relating to Geiger’s claim. The deadline for fact discovery is March 8, 2007.

     The Company intends to vigorously defend against Geiger’s claims. The Company believes that
Geiger’s claims are without merit and that the likelihood of an unfavorable outcome is remote.
Therefore, no accrual has been established related to this matter. However, the Company cannot
predict the ultimate outcome with certainty. If the above action is determined adversely to the
Company, the result could have a material adverse effect on the Company’s results of operations,
financial position and cash flows. Because Geiger has not specified an amount of monetary damages
in the case (which may be trebled under the antitrust statutes) and discovery has not yet
concluded, any potential exposure that the Company may face cannot be reasonably estimated at this
time.

The Scotts Company LLC v. Liberty Mutual Insurance Company

     On October 25, 2006, The Scotts Company LLC (“Scotts LLC”) sued Liberty Mutual
Insurance Company in the U.S. District Court for the Southern District of Ohio. In the suit, Scotts
LLC seeks damages and the rescission of a 2000 agreement between Scotts and Liberty Mutual that
purports to be a complete buyout by Scotts of any insurance policies that Liberty Mutual might have
issued to Scotts LLC (the “2000 Agreement”).

     As alleged in Scotts LLC’s complaint, in 1998, Scotts tendered certain claims to Liberty
Mutual, one of its primary-layer insurers, in connection with costs incurred by Scotts LLC for
environmental liabilities. Scotts believed that it had coverage from Liberty Mutual for at least 10
years beginning in 1958 but could only locate a single policy from 1967. Liberty Mutual responded
to Scotts LLC’s tender by stating that, after conducting an internal search, Liberty Mutual did not
have sufficient evidence to establish that it had ever insured Scotts LLC before 1967. Based on
Liberty Mutual’s representations and Scotts LLC’s inability to locate any additional Liberty Mutual
policies in Scotts LLC’s own files, Scotts LLC eventually entered into the 2000 Agreement.
According to Scotts LLC’s complaint, in Fall 2006, Scotts LLC discovered evidence confirming that,
contrary to its representations during the negotiations leading to the 2000 Agreement, Liberty
Mutual provided liability insurance to Scotts LLC beginning in at least 1958 and, in fact, paid
claims to third parties on Scotts LLC’s behalf during that period.

     The complaint seeks rescission of the 2000 Agreement and seeks damages based on Liberty
Mutual’s breach of fiduciary duty, fraud, breach of the implied covenant of good faith and fair
dealing, and bad faith denial of coverage. Scotts LLC intends to prosecute these claims vigorously.
Liberty Mutual has filed an answer that denies the complaint’s allegations. Discovery recently
began in the case and the Court has not set a trial date.

Other

     The Company has been named a defendant in a number of cases alleging injuries that the
lawsuits claim resulted from exposure to asbestos-containing products, apparently based on the
Company’s historic

 

 

use of vermiculite in certain of its products. The complaints in these cases are
not specific about the plaintiffs’ contacts with the Company or its products. The Company in each
case is one of numerous defendants and none of the claims seeks damages from the Company alone. The
Company believes that the claims against it are without merit and is vigorously defending them. It
is not currently possible to reasonably estimate a probable loss, if any, associated with the cases
and, accordingly, no accrual or reserves have been recorded in the Company’s consolidated financial
statements. There can be no assurance that these cases, whether as a result of adverse outcomes or
as a result of significant defense costs, will not have a material adverse effect on the Company’s
financial condition, results of operations or cash flows.

     The Company is reviewing agreements and policies that may provide insurance coverage or
indemnity as to these claims and is pursuing coverage under some of these agreements, although
there can be no assurance of the results of these efforts.

     We are involved in other lawsuits and claims which arise in the normal course of our business.
In our opinion, these claims individually and in the aggregate are not expected to result in a
material adverse effect on our results of operations, financial position or cash flows.

 

 

Schedule 4.8

Subsidiaries

SUBSIDIARIES OF THE SCOTTS MIRACLE-GRO COMPANY

	 
	Gutwein & Co., Inc., an Indiana corporation

	SMG Brands, Inc., a Delaware corporation

	SMG Growing Media, Inc., an Ohio corporation

	Rod McLellan Company, a California corporation

	SMGM LLC, an Ohio limited liability company

	The Scotts Company LLC, an Ohio limited liability company

	EG Systems, Inc., dba Scotts LawnService, an Indiana corporation

	Hyponex Corporation, a Delaware corporation

	OMS Investments, Inc., a Delaware corporation

	Scotts Temecula Operations, LLC, a Delaware limited liability company

	Sanford Scientific, Inc., a New York corporation

	Scotts Global Services, Inc., an Ohio corporation

	Scotts Manufacturing Company, a Delaware corporation

	Miracle-Gro Lawn Products, Inc., a New York corporation

	Scotts Products Co., an Ohio corporation

	Scotts Servicios, S.A. de C.V. (Mexico)1

	Scotts Professional Products Co., an Ohio corporation

	Scotts Servicios, S.A. de C.V. (Mexico)2

	Scotts-Sierra Horticultural Products Company, a California corporation

	Scotts-Sierra Crop Protection Company, a California corporation

	Scotts-Sierra Investments, Inc., a Delaware corporation

	Asef B.V. (Netherlands)

	Scotts Australia Pty Ltd. (Australia)

	Scotts Benelux BVBA (Belgium)3

	Scotts Canada Ltd. (Canada)

	Scotts Czech s.r.o. (Czech Republic)

	Scotts de Mexico SA de CV (Mexico)

	Scotts France Holdings SARL (France)

	Scotts France SARL (France)4

	Scotts France SAS (France)5

	Scotts Holding GmbH (Germany)

	Scotts Celaflor GmbH & Co. KG (Germany)

	Scotts Celaflor HGmbH (Austria)

	Scotts Holdings Limited (United Kingdom)

	Levington Group Limited (United Kingdom)

	The Scotts Company (UK) Limited (United Kingdom)

	The Scotts Company (Manufacturing) Limited (United Kingdom)

	OM Scott International Investments Limited (United Kingdom)

 

			
	1	 	Not wholly-owned, Scotts Professional
Products Co. owns 50%
	 
	2	 	Not wholly-owned, Scotts Products Co. owns 50%
	 
	3	 	Not wholly-owned, OMS Investments, Inc. owns .01%
	 
	4	 	Not wholly-owned, Scotts Holdings Ltd. owns .01%
	 
	5	 	Not wholly-owned, Scotts France SARL owns .01%

 

 

	 
	Corwen Home and Garden Limited (United Kingdom)

	Scotts International B.V. (Netherlands)

	Scotts Deutschland GmbH (Germany)

	Scott O.M. España, S.A. (Spain)

	Scotts Profi HGmbH (Austria)

	Scotts Italia S.r.l. (Italy)6

	Scotts Horticulture Ltd. (Ireland)

	Scotts Hungary KFT (Hungary)7

	Scotts Japan, Ltd. (Japan)8

	Scotts PBG Malaysia Sdn. Bhd. (Malaysia)

	Scotts Poland Sp.z.o.o. (Poland)

	Scotts Sweden AB (Sweden)

	The Scotts Company (Nordic) A/S (Denmark)

	The Scotts Company Italia S.r.l. (Italy)

	The Scotts Company Kenya Ltd. (Kenya)

	Turf-Seed Europe (Ireland)9

	Smith & Hawken, Ltd., a Delaware corporation

	Swiss Farms Products, Inc., a Delaware corporation

	 

	Scotts Treasury EEIG

 

			
	6	 	Not wholly-owned, James Hagedorn owns .05%
	 
	7	 	Not wholly-owned, OMS Investments, Inc. owns
3%
	 
	8	 	Not wholly-owned, Mitsui owns 39% and
Ishihara Sangyo Kaisha, Ltd. Owns 10%
	 
	9	 	Not wholly-owned, Owned 51% by Tempoverde,
Srl. — Agostino Gaude

 

 

Schedule 4.11

Certain Transactions

	1.	 	Purchases of any security as part of or in connection with a Permitted Acquisition.

	2.	 	Repurchases or redemptions of the Borrower’s Capital Stock and payment of dividends
permitted by Section 7.14.
	 
	3.	 	Any use of proceeds permitted by Section 2.23.

	4.	 	Any use of proceeds otherwise contemplated or permitted by the Agreement.

 

 

Schedule 4.17

Environmental Matters

     The Scotts Miracle-Gro Company (the “Company”) is not presently aware of any
environmental matters which would constitute an exception to the representation contained in
subsection 4.17. However, the Company identifies in the Notes to its Consolidated Financial
Statements and in its filings with the Securities and Exchange Commission the more significant of
its identified contingencies, including certain lawsuits and administrative proceedings. The
following details the contingencies that were identified in the Company’s most recent Annual Report
on Form 10-K filed December 14, 2006, updated through January 29, 2007. As used herein, “we”, “us”
and “our” refers to the Company and its subsidiaries. We also refer you to Schedule 4.5 regarding
“Litigation” for additional discussion of certain identified contingencies, including certain
lawsuits and administrative proceedings.

     In 1997, the Ohio Environmental Protection Agency initiated an enforcement action against the
Company with respect to alleged surface water violations and inadequate treatment capabilities at
the Marysville, Ohio facility and seeking corrective action under the federal Resource Conservation
and Recovery Act. The action related to discharges from on-site waste water treatment and several
discontinued on-site disposal areas.

     Pursuant to a Consent Order entered by the Union County, Ohio Common Pleas Court in 2002, the
Company is actively engaged in restoring the site to eliminate exposure to waste materials from the
discontinued on-site disposal areas.

     At September 30, 2006, $4.2 million was accrued for environmental and regulatory matters,
primarily related to the Marysville facility. Most of the accrued costs are expected to be paid in
fiscal 2007; however, payments could be made for a period thereafter. While the amounts accrued are
believed to be adequate to cover known environmental exposures based on current facts and estimates
of likely outcome, the adequacy of these accruals is based on several significant assumptions:

	 	•	 	that all significant sites that must be remediated have been identified;
	 
	 	•	 	that there are no significant conditions of contamination that are unknown to us; and
	 
	 	•	 	that with respect to the agreed judicial Consent Order in Ohio, the potentially
contaminated soil can be remediated in place rather than having to be removed and
only specific stream segments will require remediation as opposed to the entire
stream.

     If there is a significant change in the facts and circumstances surrounding these assumptions,
it could have a material impact on the ultimate outcome of these matters and our results of
operations, financial position and cash flows.

 

 

Schedule 4.19(ii)

Certain Filings

The Scotts Miracle-Gro Company, an Ohio corporation (UCC-3)

     Ohio Secretary of State

The Scotts Company LLC, an Ohio limited liability company (UCC-3)

     Ohio Secretary of State

Scotts Manufacturing Company, a Delaware corporation (UCC-3)

     Delaware Department of State

Scotts-Sierra Horticultural Products Company, a California corporation (UCC-3) 

     California Secretary of State

OMS Investments, Inc., a Delaware corporation (UCC-3) 

     Delaware Department of State

Scotts-Sierra Investments, Inc., a Delaware corporation (UCC-3) 

     Delaware Department of State

Miracle-Gro Lawn Products, Inc., a New York corporation (UCC-1) 

     New York Department of State

Hyponex Corporation, a Delaware corporation (UCC-1) 

     Delaware Department of State

Scotts Products Co., an Ohio corporation (UCC-1)

     Ohio Secretary of State

Scotts Professional Products Co., an Ohio corporation (UCC-1)

     Ohio Secretary of State

Scotts-Sierra Crop Protection Company, a California corporation (UCC-1)

     California Secretary of State

 

 

EG Systems, Inc., an Indiana corporation (UCC-1)

     Indiana Secretary of State

Swiss Farms Products, Inc., a Delaware corporation (UCC-1)

     Delaware Department of State

Scotts Temecula Operations, LLC, a Delaware limited liability company (UCC-1) 

     Delaware Department of State

Smith & Hawken, Ltd., a Delaware corporation (UCC-1)

     Delaware Department of State

Sanford Scientific, Inc., a New York corporation (UCC-1)

     New York Department of State

SMG Growing Media, Inc., an Ohio corporation (UCC-3)

     Ohio Secretary of State

Gutwein & Co., Inc., an Indiana corporation (UCC-3)

     Indiana Secretary of State

Rod McLellan Company, a California corporation (UCC-3)

     California Secretary of State

 

 

Schedule 4.19(iii)

Perfection of Foreign Stock Pledges

	 	 	 
	Document	 	Action
	 
	Share Pledge granted by
Scotts-Sierra
Investments, Inc. over
the shares of Asef B.V.

	 	Execution before a notary in
Amsterdam and registration in the
shareholders register of Asef B.V.
	 
	 	 
	Share Pledge granted by
Scotts-Sierra
Investments, Inc. over
the shares of Scotts
Holding GmbH

	 	Execution before a notary (in either

Switzerland or Germany)
	 
	 	 
	Share Pledge granted by
Scotts-Sierra
Investments, Inc. and
OMS Investments, Inc.
over the shares of
Scotts Benelux BVBA

	 	Registration in the shareholders
register of Scotts Benelux BVBA
	 
	 	 
	Share Pledge granted by
Scotts-Sierra
Investments, Inc. over
the shares of Scotts
France Holdings SARL

	 	Registration with a special registry
(registre spécial) held by the
greffe of the commercial court
(tribunal de commerce) of Lyon

 

 

Schedule 5.3(iii)

Certain Required Recordations

	 	 	 	 	 	 	 
	 	 	 	 	Document	 	Action
	 	1.	 	 	Scotts France Holdings SARL Share Pledge

	 	Registration
	 	 	 	 	 
	 	 
	 	2.	 	 	Scotts Holding GmbH Share Pledge

	 	Notarisation
	 	 	 	 	 
	 	 
	 	3.	 	 	Scotts Benelux BVBA Share Pledge

	 	Registration in the
shareholders register of
Scotts Benelux BVBA
	 	 	 	 	 
	 	 
	 	4.	 	 	Asef B.V. Share Pledge

	 	Notarisation and registration

 

 

Schedule 6.13

Foreign Pledge Agreements 

Part I. Borrower shall use commercially reasonable efforts to effect within 60 days after
the Closing Date the following pledges.

	 	 	 	 	 
	 	 	Name of Subsidiary whose	 	Percentage of Capital
	Name of Pledgor	 	Capital Stock is to be Pledged	 	Stock to be Pledged
	Scotts-Sierra Investments, Inc.

	 	Scotts France Holdings SARL
	 	 100% of Capital
Stock to secure
obligations of
Scotts-Sierra
Investments, Inc.
	 
	 	 	 	 
	Scotts-Sierra Investments, Inc.

	 	Scotts Holding GmbH
	 	 100% of Capital
Stock to secure
obligations of
Scotts-Sierra
Investments, Inc.
	 
	 	 	 	 
	Scotts-Sierra Investments, Inc.

	 	Asef B.V.
	 	 100% of Capital
Stock to secure
obligations of
Scotts-Sierra
Investments, Inc.

Part II. Borrower shall use commercially reasonable efforts to effect within 60 days after
the Closing Date the Foreign Pledge Agreement Acknowledgment and Confirmation for the pledged
Capital Stock listed below.

	 	 	 	 	 
	 	 	Name of Subsidiary	 	Percentage of Capital
	Name of Pledgor	 	whose Capital Stock is Pledged	 	Stock Pledged
	Scotts-Sierra Investments, Inc.

	 	Scotts Australia Pty Limited
(provided that delivery of
this pledge is contingent
upon confirmation from
Australian tax authorities
that the applicable
Australian stamp duty will
not be based on the total
aggregate amount of the
Facility)
	 	65% of Voting
Capital Stock to
secure obligations
of Scotts-Sierra
Investments, Inc./
65% of Voting
Capital Stock to
secure borrowings of
Foreign Subsidiary
	 
	 	 	 	 
	Scotts-Sierra Investments, Inc.

	 	Scotts Canada Limited
	 	65% of Voting
Capital Stock to
secure obligations
of Scotts-Sierra
Investments, Inc./
100% of Voting
Capital Stock to
secure borrowings of
Foreign Subsidiary
	 
	 	 	 	 
	Scotts-Sierra Investments, Inc.

	 	Scotts Benelux BVBA
	 	100% of Capital
Stock to secure
obligations of
Scotts-Sierra
Investments, Inc.
(one share being
pledged separately
by OMS Investments,
Inc.)

 

 

Borrower shall use commercially reasonable efforts to effect within 60 days after the Closing
Date deeds of confirmation for the pledged Capital Stock listed below.

	 	 	 	 	 
	Scotts Holdings Limited

	 	Levington Group Limited
	 	 100% of Capital
Stock to secure
borrowings of Scotts
Holdings Limited
	 
	 	 	 	 
	Scotts Holdings Limited

	 	O M Scott International

Investments Limited
	 	 65% of Capital Stock
to secure borrowings
of Scotts Holdings
Limited
	 
	 	 	 	 
	The Scotts Company (UK) Limited

	 	 The Scotts Company

(Manufacturing) Limited
	 	 65% of Capital Stock
to secure borrowings
of The Scotts
Company (UK) Limited
	 
	 	 	 	 
	Levington Group Limited

	 	The Scotts Company (UK)

Limited
	 	 100% of Capital
Stock pledged by
Levington Group
Limited to secure
borrowings of The
Scotts Company (UK)
Limited
	 
	 	 	 	 
	Scotts-Sierra Investments, Inc.

	 	 Scotts Holdings Limited
	 	 100% of Capital
Stock to secure
obligations of
Scotts-Sierra
Investments Inc.

 

 

Schedule 7.1(i)

Existing Liens and Encumbrances 

	1.	 	All of the UCC filings described in the summary of lien searches provided to the
Administrative Agent on February 1, 2007 and February 6, 2007.
	 
	2.	 	Liens of lessors under capital leases in the amount of $8.7 million, as described in
Schedule 7.5(c).
	 
	3.	 	The following liens on the assets of Foreign Subsidiaries:

	 	 	 
	Levington Horticulture Limited

	 	Standard Security presented for registration in Scotland in
favour of National Westminster Plc (as Security Trustee for itself and the beneficiaries)
dated 22 July 1992
	 
	 	 
	O.M. Scott & Sons Ltd.

	 	Deed of Charge over Credit Balances in favour of Barclays Bank Plc
dated 14 December 1992

	4.	 	Liens permitted by Section 7.1(k) of the December 4, 1998 Credit Agreement; provided
that the Indebtedness secured by such liens has been paid in full.

 

 

Schedule 7.2(iii)

Existing Guarantees 

	1.	 	Guarantee by The Scotts Company of certain obligations of E.G. Systems, Inc. d/b/a
Scotts LawnService as described below:

	 	 	 	 	 
	Liqui Green – Spraying (Peoria)
	 	$	127,482	 
	Liqui Green – Lawn Care Corp.
	 	$	532,592	 
	All Pro Enviro Services (Nutri-Lawn – Seattle)
	 	$	1,700,000	 
	Guaranteed Scotts LawnService Leases
	 	$	401,851	 
	 
	 	 	 
	Subtotal
	 	$	2,761,925	 
	 
	 	 	 

	2.	 	Guarantees of residual values under existing operating lease agreements totaling $31.7
million.

	3.	 	Revenue guarantee related to the Pure Seed Testing License Agreement in the amount of
$1.64 million per year for 10 years (totaling not more than $16.4 million over that period
of time).

	4.	 	Springing guarantee in the amount of $945,000, by The Scotts Company for lease of
manufacturing equipment used for the production and packaging of certain Scotts products in
Europe, which equipment is leased by Peltracom Potgrand Divisie N.V., as lessee, from KBC
Bank and DeLage Landen, as lessors.

	5.	 	Parent guarantee supporting a euro denominated bank line of credit extended to Scotts
France SAS. The January 2007 available balance of such bank line of credit was
U.S.$9,811,600 using a euro to dollars exchange rate of 1.29.

	6.	 	Guarantee of Performance, dated March 18, 2005, of E.G. Systems, Inc. under its
franchise registrations in the States of California, Hawaii, Illinois, Indiana,
Maryland, Michigan, Minnesota, New York, North Dakota, Rhode Island, South Dakota,
Virginia, Washington and Wisconsin and under its Scotts LawnService Franchise
Agreements with franchisees, which guarantee continues in effect until E.G.
Systems, Inc. has satisfied all of its obligations under the state franchise
registrations and the Scotts LawnService Franchise Agreements. Maximum exposure
at any one time is estimated to be ten franchisee set-ups at $10,000 per set-up, or
$100,000.

 

 

Schedule 7.5(c)

Existing Indebtedness 

	1.	 	All Working capital lines of credit currently available to any Foreign Subsidiaries, in
an aggregate amount not to exceed the Dollar Equivalent of $25,000,000.

	2.	 	All outstanding letters of credit, interest rate swap hedging instruments, and foreign
currency exchange hedging agreements that are listed on Schedule 4.1.
	 
	3.	 	All synthetic leases described below:

	 	 	 	 	 	 	 	 	 	 	 
	 	 	Amount	 	 	Term	 	Maturity	 	Lessor
	The Scotts Company
	 	$	12,900,000	 	 	5-yr	 	08/30/2008	 	Fleet Bank
	The Scotts Company
	 	$	5,846,230	 	 	8-yr	 	12/29/2009	 	Fleet Bank
	 
	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	Total
	 	$	18,746,230	 	 	 	 	 	 	 

	4.	 	Various capital leases totaling approximately $8.7 million. Buildings on the
Marysville campus make up $6.4 million of this total, with the rest consisting primarily of
computer equipment throughout the company and manufacturing equipment at 3rd
party vendors.

	5.	 	Deferred purchase obligations totaling approximately $5.3 million primarily for various
acquisitions for EG Systems, Inc. d/b/a Scotts LawnService.

	6.	 	Contingent deferred purchase obligation due in 2012 recorded at $10.1 million relating
to the acquisition of certain brands and assets of Turf Seed, Inc. Ultimate contingent
payout could approximate $15 million.

	7.	 	Contingent obligations to lessors for facility build-outs under Smith & Hawken
operating lease agreements totaling $2.7 million.

 

 

Schedule 7.9

Sale and Leaseback

As of May 1, 2000, certain real property located in Marysville including The Scotts Miracle-Gro
Company headquarters building, research building and parcel “C” (a test plot) were transferred to
The State of Ohio Department of Development, who immediately leased it to the Community Improvement
Corporation of Union County, who then immediately subleased it to The Scotts Company. A partial
release of the JPMorgan Chase Bank mortgage was recorded releasing the subject property.

 

 

Schedule 10.2

Notices

Notices are on file with the Administrative Agent

 

 

EXHIBIT A

FORM OF ASSIGNMENT AND ACCEPTANCE

          Reference is made to the Restated and Amended Credit Agreement, dated as of February [___],
2007 (as amended, supplemented, waived or otherwise modified from time to time, the “Credit
Agreement”), by and among The Scotts Miracle-Gro Company, an Ohio corporation (the
“Borrower”), the Subsidiary Borrowers (as defined in the Credit Agreement) from time to
time parties thereto, the several banks and other financial institutions from time to time parties
thereto (the “Lenders”), the Syndication Agent and the Documentation Agents named therein,
and JPMorgan Chase Bank, N.A. as agent for the Lenders thereunder (in such capacity, the
“Administrative Agent”). Terms defined in the Credit Agreement are used herein with the
same meanings.

                               (the “Assignor”) and                      (the “Assignee”) agree as follows:

          The Assignor identified on Schedule l hereto (the “Assignor”) and the Assignee
identified on Schedule l hereto (the “Assignee”) agree as follows:

          1. The Assignor hereby irrevocably sells and assigns to the Assignee without recourse to the
Assignor, and the Assignee hereby irrevocably purchases and assumes from the Assignor without
recourse to the Assignor, as of the Effective Date (as defined below), the interest described in
Schedule 1 hereto (the “Assigned Interest”) in and to the Assignor’s rights and obligations
under the Credit Agreement with respect to those credit facilities contained in the Credit
Agreement as are set forth on Schedule 1 (individually, an “Assigned Facility”;
collectively, the “Assigned Facilities”), in a principal amount for each Assigned Facility
as set forth on Schedule 1.

          2. The Assignor (i) makes no representation or warranty and assumes no responsibility with
respect to any statements, warranties or representations made in or in connection with the Credit
Agreement or the execution, legality, validity, enforceability, genuineness, sufficiency or value
of the Credit Agreement, any other Loan Document or any other instrument or document furnished
pursuant thereto, other than that it has not created any adverse claim upon the interest being
assigned by it hereunder and that such interest is free and clear of any such adverse claim; (ii)
makes no representation or warranty and assumes no responsibility with respect to the financial
condition of the Borrower, any of its Subsidiaries or any other obligor or the performance or
observance by the Borrower, any of its Subsidiaries or any other obligor of any of their respective
obligations under the Credit Agreement or any other Loan Document or any other instrument or
document furnished pursuant hereto or thereto; and (iii) attaches the Note(s) held by it, if any,
evidencing the Assigned Facilities, which Notes(s) the Administrative Agent promptly will return to
the Borrower or relevant Subsidiary Borrower, and, if applicable, requests that the Administrative
Agent exchange such Note(s) for a new Note or Notes payable to the Assignee and (if the Assignor
has retained any interest in the Assigned Facility) a new Note or Notes payable to the Assignor in
the respective amounts which reflect the assignment being made hereby (and after giving effect to
any other assignments which have become effective on or after the Effective Date) and

 

2

          3. The Assignee (i) represents and warrants that it is legally authorized to enter into this
Assignment and Acceptance; (ii) confirms that it has received a copy of the Credit Agreement,
together with copies of the financial statements delivered pursuant to subsection 4.1 thereof and
such other documents and information as it has deemed appropriate to make its own credit analysis
and decision to enter into this Assignment and Acceptance; (iii) agrees that it will, independently
and without reliance upon the Assignor, the Administrative Agent or any other Lender and based on
such documents and information as it shall deem appropriate at the time, continue to make its own
credit decisions in taking or not taking action under the Credit Agreement, the other Loan
Documents or any other instrument or document furnished pursuant hereto or thereto; (iv) appoints
and authorizes the Administrative Agent to take such action as agent on its behalf and to exercise
such powers and discretion under the Credit Agreement, the other Loan Documents or any other
instrument or document furnished pursuant hereto or thereto as are delegated to the Administrative
Agent by the terms thereof, together with such powers as are incidental thereto; and (v) agrees
that it will be bound by the provisions of the Credit Agreement and will perform in accordance with
its terms all the obligations which by the terms of the Credit Agreement are required to be
performed by it as a Lender.

          4. The effective date of this Assignment and Acceptance shall be Effective Date of the
Assignment described on Schedule 1 hereto (the “Effective Date”). Following the execution
of this Assignment and Acceptance, it will be delivered to the Administrative Agent for acceptance
by it and recording by the Administrative Agent pursuant to the Credit Agreement, effective as of
the Effective Date (which shall not, unless otherwise agreed to by the Administrative Agent, be
earlier than five Business Days after the date of such acceptance and recording by the
Administrative Agent).

          5. Upon such acceptance and recording, from and after the Effective Date, the Administrative
Agent shall make all payments in respect of the Assigned Interest (including payments of principal,
interest, fees and other amounts) to the Assignee. The Assignor and the Assignee shall make all
appropriate adjustments in payments by the Administrative Agent for periods prior to the Effective
Date or with respect to the making of this assignment directly between themselves.

          6. From and after the Effective Date, (i) the Assignee shall be a party to the Credit
Agreement and, to the extent provided in this Assignment and Acceptance, have the rights and
obligations of a Lender thereunder and under the other Loan Documents and shall be bound by the
provisions thereof and (ii) to the extent provided in this Assignment and Acceptance, the rights of
the Assignor shall, to the extent provided in this Assignment and Acceptance, relinquish its rights
and be released from its obligations under the the Credit Agreement.

          7. For purposes of article 1278 et seq. of the French Civil Code, in the event of an
assignment, a transfer, a novation or disposal of all or part of the rights and obligations of the
Assignor to the Assignee, the Assignor expressly preserves the security interests, rights, powers,
and privileges and actions created pursuant to the security document governed by French law for the
benefit of the Assignee.

          8. This Assignment and Acceptance shall be governed by and construed and interpreted in
accordance with, the law of the State of New York.

 

3

          IN WITNESS WHEREOF, the parties hereto have caused this Assignment and Acceptance to be
executed as of the date first above written by their respective duly authorized officers on
Schedule 1 hereto.

 

Schedule 1

to Assignment and Acceptance relating to the Amended and Restated Credit Agreement dated as of
February [___], 2007, among the Borrower, the Subsidiary Borrowers, the Lenders from time to time
parties thereto and JPMorgan Chase Bank, N.A., as Administrative Agent

Name of Assignor:

Name of Assignee:

     [(a) Assignee is a Lender Affiliate of:                     ]1

     [(b) Assignee is an Approved Fund administered or managed by:                     ]2

Effective Date of Assignment:

	 	 	 	 	 	 	 	 	 	 	 
	Credit	 	Principal	 	 
	Facility Assigned	 	Amount Assigned3	 	Commitment Percentage Assigned
	 	 	 	 	 	 	 	 	 	 	 

	 	 	 	 
	[NAME OF ASSIGNOR],

as Assignor

 	 
	By:  	 	 
	 	Name:  	 	 
	 	Title:  	 	 
	 

	 	 	 	 
	[NAME OF ASSIGNEE],

as Assignee

 	 
	By:  	 	 
	 	Name:  	 	 
	 	Title:  	 	 
	 

 

			
	1	 	To be completed by the Assignee if applicable.
	 
	2	 	To be completed by the Assignee if applicable.
	 
	3	 	In Dollars, euros, Sterling, Canadian Dollars,
Australian Dollars or Optional Currencies, as applicable.

 

2

	 	 	 	 
	JPMORGAN CHASE BANK, N.A.,

as Administrative Agent [and Issuing Lender]

 	 
	By:  	 	 
	 	Name:  	 	 
	 	Title:  	 	 
	 

	 	 	 	 
	[NAME OF ISSUING LENDER]4,

as Issuing Lender

 	 
	By:  	 	 
	 	Name:  	 	 
	 	Title:  	 	 
	 

	 	 	 	 
	[Consented To:

THE SCOTTS MIRACLE-GRO COMPANY

 	 
	By:  	 	 
	 	Name:  	 	 
	 	Title:  	]5 	 
	 

 

			
	4	 	Include if the Issuing Lender is a Lender other
than JPMorgan Chase Bank, N.A.
	 
	5	 	Include if applicable.

 

EXHIBIT B

FORM OF

AMENDED AND RESTATED GUARANTEE AND COLLATERAL AGREEMENT

made by

THE SCOTTS MIRACLE-GRO COMPANY,

EACH DOMESTIC SUBSIDIARY BORROWER

and certain of their Domestic Subsidiaries

in favor of

JPMORGAN CHASE BANK, N.A.,

as Administrative Agent

Dated as of February 7, 2007

 

 

TABLE OF CONTENTS

	 	 	 	 	 	 	 
	 	 	 	 	Page	 
	 
	 	 	 	 	 	 
	SECTION
1.
	 	DEFINED TERMS	 	 	3	 
	 
	 	 	 	 	 	 
	1.1.
	 	Definitions	 	 	3	 
	1.2.
	 	Other Definitional Provisions	 	 	6	 
	 
	 	 	 	 	 	 
	SECTION 2.
	 	BORROWER GUARANTEE	 	 	6	 
	 
	 	 	 	 	 	 
	2.1.
	 	Borrower Guarantee	 	 	6	 
	2.2.
	 	No Subrogation	 	 	7	 
	2.3.
	 	Amendments, etc. with respect to the Subsidiary Borrower Obligations	 	 	7	 
	2.4.
	 	Guarantee Absolute and Unconditional	 	 	7	 
	2.5.
	 	Reinstatement	 	 	8	 
	2.6.
	 	Payments	 	 	8	 
	 
	 	 	 	 	 	 
	SECTION 3.
	 	DOMESTIC SUBSIDIARY GUARANTEE	 	 	8	 
	 
	 	 	 	 	 	 
	3.1.
	 	Domestic Subsidiary Guarantee	 	 	8	 
	3.2.
	 	Right of Contribution	 	 	9	 
	3.3.
	 	No Subrogation	 	 	9	 
	3.4.
	 	Amendments, etc. with respect to the Borrower Obligations and the	 	 	 	 
	 
	 	Borrower’s Guarantor Obligations	 	 	10	 
	3.5.
	 	Guarantees Absolute and Unconditional	 	 	10	 
	3.6.
	 	Reinstatement	 	 	11	 
	3.7.
	 	Payments	 	 	11	 
	 
	 	 	 	 	 	 
	SECTION 4.
	 	GRANT OF SECURITY INTEREST	 	 	11	 
	 
	 	 	 	 	 	 
	SECTION 5.
	 	REPRESENTATIONS AND WARRANTIES	 	 	12	 
	 
	 	 	 	 	 	 
	5.1.
	 	Title; No Other Liens	 	 	12	 
	5.2.
	 	Perfected First Priority Liens	 	 	12	 
	5.3.
	 	Jurisdiction of Organization	 	 	12	 
	5.4.
	 	Domestic Subsidiaries	 	 	13	 
	5.5.
	 	Pledged Stock	 	 	13	 
	5.6.
	 	Receivables	 	 	13	 
	 
	 	 	 	 	 	 
	SECTION 6.
	 	COVENANTS	 	 	13	 
	 
	 	 	 	 	 	 
	6.1.
	 	Delivery of Certificated Securities	 	 	13	 
	6.2.
	 	Maintenance of Insurance	 	 	13	 
	6.3.
	 	Payment of Obligations	 	 	14	 
	6.4.
	 	Maintenance of Perfected Security Interest; Further Documentation	 	 	14	 
	6.5.
	 	Notices	 	 	14	 
	6.6.
	 	Pledged Stock	 	 	14	 
	6.7.
	 	Receivables	 	 	15	 
	 
	 	 	 	 	 	 
	SECTION 7.
	 	REMEDIAL PROVISIONS	 	 	16	 

 

2

	 	 	 	 	 	 	 
	 	 	 	 	Page	 
	 
	 	 	 	 	 	 
	7.1.
	 	Certain Matters Relating to Receivables	 	 	16	 
	7.2.
	 	Communications with Obligors; Grantors Remain Liable	 	 	16	 
	7.3.
	 	Pledged Stock	 	 	17	 
	7.4.
	 	Proceeds to be Turned Over To Administrative Agent	 	 	18	 
	7.5.
	 	Application of Proceeds	 	 	18	 
	7.6.
	 	Code and Other Remedies	 	 	18	 
	7.7.
	 	Registration Rights	 	 	19	 
	7.8.
	 	Deficiency	 	 	20	 
	 
	 	 	 	 	 	 
	SECTION
8.
	 	THE ADMINISTRATIVE AGENT	 	 	20	 
	 
	 	 	 	 	 	 
	8.1.
	 	Administrative Agent’s Appointment as Attorney-in-Fact, etc	 	 	20	 
	8.2.
	 	Duty of Administrative Agent	 	 	21	 
	8.3.
	 	Execution of Financing Statements	 	 	22	 
	8.4.
	 	Authority of Administrative Agent	 	 	22	 
	 
	 	 	 	 	 	 
	SECTION
9.
	 	MISCELLANEOUS	 	 	22	 
	 
	 	 	 	 	 	 
	9.1.
	 	Amendments in Writing	 	 	22	 
	9.2.
	 	Notices	 	 	22	 
	9.3.
	 	No Waiver by Course of Conduct; Cumulative Remedies	 	 	22	 
	9.4.
	 	Enforcement Expenses; Indemnification	 	 	23	 
	9.5.
	 	Successors and Assigns	 	 	23	 
	9.6.
	 	Set-Off	 	 	23	 
	9.7.
	 	Counterparts	 	 	24	 
	9.8.
	 	Severability	 	 	24	 
	9.9.
	 	Section Headings	 	 	24	 
	9.10.
	 	Integration	 	 	24	 
	9.11.
	 	GOVERNING LAW	 	 	24	 
	9.12.
	 	Submission To Jurisdiction; Waivers	 	 	24	 
	9.13.
	 	Acknowledgments	 	 	24	 
	9.14.
	 	Additional Grantors	 	 	25	 
	9.15.
	 	Releases; Reinstatement	 	 	25	 
	9.16.
	 	Conflict of Laws	 	 	26	 
	9.17.
	 	WAIVER OF JURY TRIAL	 	 	26	 

	 	 	 
	SCHEDULES	 	 
	 
	Schedule 1

	 	Notice Addresses of Guarantors
	Schedule 2

	 	Description of Pledged Stock
	Schedule 3

	 	Jurisdiction of Incorporation
	Schedule 4

	 	Domestic Subsidiaries

 

 

3

     THIS AMENDED AND RESTATED GUARANTEE AND COLLATERAL AGREEMENT, dated as of February 7, 2007
made by each of the signatories hereto (together with any other entity that may become a party
hereto as provided herein, the “Grantors”), in favor of JPMORGAN CHASE BANK, N.A., as
Administrative Agent (in such capacity, the “Administrative Agent”) for the banks and other
financial institutions (the “Lenders”) from time to time parties to the Amended and
Restated Credit Agreement, dated as of February 7, 2007 (as amended, supplemented or otherwise
modified from time to time, the “Credit Agreement”), among THE SCOTTS MIRACLE-GRO COMPANY,
an Ohio corporation (the “Borrower”), the Subsidiary Borrowers, (as defined in the Credit
Agreement) from time to time parties to the Credit Agreement, the Syndication Agent and the
Documentation Agents named therein and the Administrative Agent.

W I
T N E S S E T H:

     WHEREAS, pursuant to the Credit Agreement, the Lenders have severally agreed to make
extensions of credit to the Borrower and the Subsidiary Borrowers upon the terms and subject to the
conditions set forth therein;

     WHEREAS, the Borrower and each Subsidiary Borrower is a member of an affiliated group of
companies that includes each other Grantor;

     WHEREAS, the proceeds of the extensions of credit under the Credit Agreement will be used in
part to enable the Borrower and each Subsidiary Borrower to make valuable transfers to one or more
of the other Grantors in connection with the operation of their respective businesses;

     WHEREAS, the Borrower, each Subsidiary Borrower and the other Grantors are engaged in related
businesses, and each Grantor will derive substantial direct and indirect benefit from the making of
the extensions of credit under the Credit Agreement; and

     WHEREAS, it is a condition precedent to the obligation of the Lenders to make their respective
extensions of credit to the Borrower and any Subsidiary Borrower under the Credit Agreement that
the Grantors shall have executed and delivered this Agreement to the Administrative Agent for the
ratable benefit of the Secured Parties;

     NOW, THEREFORE, in consideration of the premises and to induce the Administrative Agent and
the Lenders to enter into the Credit Agreement and to induce the Lenders to make their respective
extensions of credit to the Borrower and each Subsidiary Borrower thereunder, each Grantor hereby
agrees with the Administrative Agent, for the ratable benefit of the Secured Parties, as follows:

     SECTION 1. DEFINED TERMS

     1.1. Definitions(a) Unless otherwise defined herein, terms defined in the Credit
Agreement and used herein shall have the meanings given to them in the Credit Agreement and the
following terms are used herein as defined in the New York UCC: Accounts, Certificated Security,
Chattel Paper, Equipment, Inventory, Instruments and Supporting Obligations.

     (b) The following terms shall have the following meanings:

     “Agreement”: this Amended and Restated Guarantee and Collateral Agreement, as
the same may be amended, supplemented or otherwise modified from time to time.

 

4

     “Borrower Obligations”: the collective reference to the unpaid principal of and
interest on the Loans and Reimbursement Obligations and all other obligations and
liabilities of the Borrower (including, without limitation, interest accruing at the then
applicable rate provided in the Credit Agreement after the maturity of the Loans and
Reimbursement Obligations and interest accruing at the then applicable rate provided in the
Credit Agreement after the filing of any petition in bankruptcy, or the commencement of any
insolvency, reorganization or like proceeding, relating to the Borrower, whether or not a
claim for post-filing or post-petition interest is allowed in such proceeding) to the
Administrative Agent or any Lender (or, in the case of any Lender Hedging Agreement or
Lender Cash Management Agreement, any Affiliate of any Lender), whether direct or indirect,
absolute or contingent, due or to become due, or now existing or hereafter incurred, which
may arise under, out of, or in connection with, the Credit Agreement, this Agreement, the
other Loan Documents, any Letter of Credit, any Lender Hedging Agreement, any Lender Cash
Management Agreement or any other document made, delivered or given in connection with any
of the foregoing, in each case whether on account of principal, interest, reimbursement
obligations, fees, indemnities, costs, expenses or otherwise (including, without limitation,
all fees and disbursements of counsel to the Administrative Agent or to the Lenders that are
required to be paid by the Borrower pursuant to the terms of any of the foregoing
agreements).

     “Borrower’s Guarantor Obligations”: without duplicating any Borrower
Obligations, all obligations and liabilities of the Borrower which may arise under or in
connection with this Agreement (including, without limitation, Section 2) or any other Loan
Document to which the Borrower is a party, whether on account of guarantee obligations,
reimbursement obligations, fees, indemnities, costs, expenses or otherwise (including,
without limitation, all fees and disbursements of counsel to the Administrative Agent or to
the Lenders that are required to be paid by the Borrower pursuant to the terms of this
Agreement or any other Loan Document).

     “Capital Stock Security Period”: as defined in Section 9.15(d).

     “Collateral”: as defined in Section 4.

     “Foreign Subsidiary”: any Subsidiary organized under the laws of any
jurisdiction outside the United States of America, except for any such Subsidiary which is a
“check-the-box” entity under Regulation section 301.7701-3 of the Code.

     “Foreign Subsidiary Voting Stock”: the voting Capital Stock of any Foreign
Subsidiary.

     “Full Security Period”: any period from and after the Closing Date other than
any Unsecured Period or Capital Stock Security Period.

     “Guarantor Obligations”: with respect to any Guarantor, without duplicating
any Subsidiary Borrower Obligations, all obligations and liabilities of such Guarantor which
may arise under or in connection with this Agreement (including, without limitation, Section
3) or any other Loan Document to which such Guarantor is a party, in each case whether on
account of guarantee obligations, reimbursement obligations, fees, indemnities, costs,
expenses or otherwise (including, without limitation, all fees and disbursements of counsel
to the Administrative Agent or to the Lenders that are required to be paid by such Guarantor
pursuant to the terms of this Agreement or any other Loan Document).

 

5

     “Guarantors”: the collective reference to each Grantor other than the
Borrower. For the avoidance of doubt, notwithstanding any other provision of this
Agreement, the parties hereto expressly agree that no Foreign Subsidiary shall be a
Guarantor.

     “Issuers”: the collective reference to each issuer of any Pledged Stock.

     “Leverage Release Date”: as defined in Section 9.15(d).

     “New York UCC”: the Uniform Commercial Code as from time to time in effect in
the State of New York.

     “Obligations”: (i) in the case of the Borrower, the Borrower Obligations and
the Borrower’s Guarantor Obligations, (ii) in the case of each Guarantor which is also a
Domestic Subsidiary Borrower, its Subsidiary Borrower Obligations, and (iii) in the case of
each Guarantor (whether or not a Domestic Subsidiary Borrower), its Guarantor Obligations.

     “Pledged Stock”: the shares of Capital Stock listed on Schedule 2,
together with any other shares, stock certificates, options or rights of any nature
whatsoever in respect of the Capital Stock of any Subsidiary of the Borrower (to the extent
required to be pledged under Section 6.11 of the Credit Agreement) that may be issued or
granted to, or held by, any Grantor while this Agreement is in effect; provided that
in no event shall more than 65% of the total outstanding Foreign Subsidiary Voting Stock of
any Foreign Subsidiary be required to be pledged hereunder; provided further
that the shares of Capital Stock of Scotts Australia Pty Limited (the “Scotts Australia
Shares”) shall not constitute Pledged Stock at any time when the 2005 Equitable Share
Mortgage made by Scotts-Sierra Investments, Inc. in favor of JPMCB (or any such successor
Foreign Pledge Agreement entered into in respect of the Scotts Australia Shares for the
benefit of the Secured Parties) shall be in effect.

     “Proceeds”: all “proceeds” as such term is defined in Section 9-102(a)(64) of
the New York UCC and, in any event, shall include, without limitation, all dividends or
other income from the Pledged Stock, collections thereon or distributions or payments with
respect thereto.

     “Ratings Release Date”: as defined in Section 9.15(c).

     “Receivable”: shall mean any Account and any other right to payment for goods
sold or leased or for services rendered, whether or not such right is evidenced by an
Instrument or Chattel Paper and whether or not it has been earned by performance, other than
Sold Receivables.

     “Secured Parties”: the collective reference to the Administrative Agent, the
Lenders and any Affiliate of any Lender to which Borrower Obligations or Guarantor
Obligations, as applicable, are owed.

     “Securities Act”: the Securities Act of 1933, as amended.

     “Subsidiary Borrower Obligations”: with respect to each Subsidiary Borrower,
without duplicating any Guarantor Obligations, the collective reference to the unpaid
principal of and interest on the Loans and all other obligations and liabilities of such
Subsidiary Borrower (including, without limitation, interest accruing at the then applicable
rate provided in the Credit Agreement after the maturity of the Loans and interest accruing
at the then applicable rate provided in the Credit Agreement after the filing of any
petition in bankruptcy, or the commencement of any insolvency, reorganization or like
proceeding, relating to such Subsidiary

 

6

Borrower, whether or not a claim for post-filing or post-petition interest is allowed
in such proceeding) to the Administrative Agent or any Lender (or, in the case of any Lender
Hedge Agreement or Lender Cash Management Agreement, any Affiliate of any Lender), whether
direct or indirect, absolute or contingent, due or to become due, or now existing or
hereafter incurred, which may arise under, out of, or in connection with, the Credit
Agreement, this Agreement, the other Loan Documents, any Letter of Credit, any Lender
Hedging Agreement, any Lender Cash Management Agreement or any other document made,
delivered or given in connection with any of the foregoing, in each case whether on account
of principal, interest, reimbursement obligations, fees, indemnities, costs, expenses or
otherwise (including, without limitation, all fees and disbursements of counsel to the
Administrative Agent or to the Lenders that are required to be paid by such Subsidiary
Borrower pursuant to the terms of any of the foregoing agreements).

“Unsecured Period”: as defined in Section 9.15(c).

     1.2. Other Definitional Provisions(a) The words “hereof,” “herein”, “hereto” and
“hereunder” and words of similar import when used in this Agreement shall refer to this Agreement
as a whole and not to any particular provision of this Agreement, and Section and Schedule
references are to this Agreement unless otherwise specified.

     (a) The meanings given to terms defined herein shall be equally applicable to both the
singular and plural forms of such terms.

     (b) Where the context requires, terms relating to the Collateral or any part thereof, when
used in relation to a Grantor, shall refer to such Grantor’s Collateral or the relevant part
thereof.

     SECTION 2. BORROWER GUARANTEE

     2.1. Borrower Guarantee(a) The Borrower hereby, unconditionally and irrevocably,
guarantees to the Administrative Agent, for the ratable benefit of the Secured Parties and their
respective successors, indorsees, transferees and assigns, the prompt and complete payment and
performance by each Subsidiary Borrower when due (whether at the stated maturity, by acceleration
or otherwise) of its Subsidiary Borrower Obligations.

     (b) Anything herein or in any other Loan Document to the contrary notwithstanding, the maximum
liability of the Borrower hereunder and under the other Loan Documents shall in no event exceed the
amount which can be guaranteed by the Borrower under applicable federal and state laws relating to
the insolvency of debtors.

     (c) The guarantee contained in this Section 2 shall remain in full force and effect until all
the Subsidiary Borrower Obligations and the obligations of the Borrower under the guarantee
contained in this Section 2 shall have been satisfied by payment in full, no Letter of Credit shall
be outstanding and the Commitments and Loans shall be terminated, notwithstanding that from time to
time during the term of the Credit Agreement each Subsidiary Borrower may be free from any
Subsidiary Borrower Obligations.

     (d) No payment made by any Subsidiary Borrower, any of the other Guarantors, any other
guarantor or any other Person or received or collected by the Administrative Agent or any Lender
from any Subsidiary Borrower, any of the other Guarantors, any other guarantor or any other Person
by
virtue of any action or proceeding or any set-off or appropriation or application at any time
or from time to time in reduction of or in payment of the Subsidiary Borrower Obligations shall be
deemed to modify, reduce, release or otherwise affect the liability of the Borrower hereunder which
shall, notwithstanding

 

7

any such payment (other than any payment made by the Borrower in respect of
the Subsidiary Borrower Obligations or any payment received or collected from the Borrower in
respect of the Subsidiary Borrower Obligations), remain liable for the Subsidiary Borrower
Obligations up to the maximum liability of the Borrower hereunder until the Subsidiary Borrower
Obligations are paid in full, no Letter of Credit shall be outstanding and the Commitments are
terminated.

     2.2. No Subrogation. Notwithstanding any payment or payments made by the Borrower
hereunder, or any set-off or application of funds of the Borrower by the Administrative Agent or
any Lender, the Borrower shall not be entitled to be subrogated to any of the rights of the
Administrative Agent or any Lender against the Subsidiary Borrowers or against any collateral
security or guarantee or right of offset held by the Administrative Agent or any Lender for the
payment of the Subsidiary Borrower Obligations, nor shall the Borrower seek or be entitled to seek
any contribution or reimbursement from the Subsidiary Borrowers in respect of payments made by the
Borrower hereunder, until all amounts owing to the Administrative Agent and the Lenders by the
Subsidiary Borrowers on account of the Subsidiary Borrower Obligations are paid in full and the
Commitments and Loans are terminated. If any amount shall be paid to the Borrower on account of
such subrogation rights at any time when all of the Subsidiary Borrower Obligations shall not have
been paid in full, such amount shall be held by the Borrower in trust for the Administrative Agent
and the Lenders, segregated from other funds of the Borrower, and shall, forthwith upon receipt by
the Borrower, be turned over to the Administrative Agent in the exact form received by the Borrower
(duly indorsed by the Borrower to the Administrative Agent, if required), to be applied against the
Subsidiary Borrower Obligations, whether matured or unmatured, in such order as the Administrative
Agent may determine.

     2.3. Amendments, etc. with respect to the Subsidiary Borrower Obligations. The
Borrower shall remain obligated hereunder notwithstanding that, without any reservation of rights
against the Borrower and without notice to or further assent by the Borrower, any demand for
payment of any of the Subsidiary Borrower Obligations made by the Administrative Agent or any
Lender may be rescinded by the Administrative Agent or such Lender and any of the Subsidiary
Borrower Obligations continued, and the Subsidiary Borrower Obligations, or the liability of any
other Person upon or for any part thereof, or any collateral security or guarantee therefor or
right of offset with respect thereto, may, from time to time, in whole or in part, be renewed,
extended, amended, modified, accelerated, compromised, waived, surrendered or released by the
Administrative Agent or any Lender, and the Credit Agreement and the other Loan Documents and any
other documents executed and delivered in connection therewith may be amended, modified,
supplemented or terminated, in whole or in part, as the Administrative Agent (or the Required
Lenders or all Lenders, as the case may be) may deem advisable from time to time, and any
collateral security, guarantee or right of offset at any time held by the Administrative Agent or
any Lender for the payment of the Subsidiary Borrower Obligations may be sold, exchanged, waived,
surrendered or released. Neither the Administrative Agent nor any Lender shall have any obligation
to protect, secure, perfect or insure any Lien at any time held by it as security for the
Subsidiary Borrower Obligations or for the guarantee contained in this Section 2 or any property
subject thereto.

     2.4. Guarantee Absolute and Unconditional. The Borrower waives any and all notice of
the creation, renewal, extension or accrual of
any of the Subsidiary Borrower Obligations and notice of or proof of reliance by the Administrative
Agent or any Lender upon the guarantee contained in this Section 2 or acceptance of the guarantee
contained in this Section 2; the Subsidiary Borrower Obligations, and any of them, shall
conclusively be deemed to have been created, contracted or incurred, or renewed, extended, amended
or waived, in reliance upon the guarantee contained in this Section 2; and all dealings between the
Borrower and the Subsidiary Borrowers, on the one hand, and the Administrative Agent and the
Lenders, on the other hand, likewise shall be conclusively presumed to have been had or consummated
in reliance upon the guarantee contained in this Section 2. The Borrower waives diligence,
presentment, protest, demand for payment and notice of default or nonpayment to or upon the
Borrower

 

8

or the applicable Subsidiary Borrower with respect to the Subsidiary Borrower Obligations.
The Borrower understands and agrees that the guarantee contained in this Section 2 shall be
construed as a continuing, absolute and unconditional guarantee of payment without regard to (a)
the validity or enforceability of the Credit Agreement or any other Loan Document, any of the
Subsidiary Borrower Obligations or any other collateral security therefor or guarantee or right of
offset with respect thereto at any time or from time to time held by the Administrative Agent or
any Lender, (b) any defense, set-off or counterclaim (other than a defense of payment or
performance) which may at any time be available to or be asserted by any Subsidiary Borrower or any
other Person against the Administrative Agent or any Lender, or (c) any other circumstance
whatsoever (with or without notice to or knowledge of the Borrower or any Subsidiary Borrower)
which constitutes, or might be construed to constitute, an equitable or legal discharge of the
Subsidiary Borrowers for the Subsidiary Borrower Obligations, or of the Borrower under the
guarantee contained in this Section 2, in bankruptcy or in any other instance. When making any
demand hereunder or otherwise pursuing its rights and remedies hereunder against the Borrower, the
Administrative Agent or any Lender may, but shall be under no obligation to, make a similar demand
on or otherwise pursue such rights and remedies as it may have against the Subsidiary Borrowers or
any other Person or against any collateral security or guarantee for the Subsidiary Borrower
Obligations or any right of offset with respect thereto, and any failure by the Administrative
Agent or any Lender to make any such demand, to pursue such other rights or remedies or to collect
any payments from the Borrower, any Subsidiary Borrower, or any other Person or to realize upon any
such collateral security or guarantee or to exercise any such right of offset, or any release of
the Borrower, any Subsidiary Borrower or any other Person or any such collateral security,
guarantee or right of offset, shall not relieve the Borrower of any obligation or liability
hereunder, and shall not impair or affect the rights and remedies, whether express, implied or
available as a matter of law, of the Administrative Agent or any Lender against the Borrower. For
the purposes hereof, “demand” shall include the commencement and continuance of any legal
proceedings.

     2.5. Reinstatement. The guarantee contained in this Section 2 shall continue to be
effective, or be reinstated, as the case may be, if at any time payment, or any part thereof, of
any of the Subsidiary Borrower Obligations is rescinded or must otherwise be restored or returned
by the Administrative Agent or any Lender upon the insolvency, bankruptcy, dissolution, liquidation
or reorganization of the Borrower, any Subsidiary Borrower or any other Guarantor, or upon or as a
result of the appointment of a receiver, intervenor or conservator of, or trustee or similar
officer for, the Borrower, any Subsidiary Borrower or any other Guarantor or any substantial part
of its property, or otherwise, all as though such payments had not been made.

     2.6. Payments. The Borrower hereby guarantees that payments hereunder will be paid to
the Administrative Agent without set-off or counterclaim in Dollars or the applicable Optional
Currency at
the office of the Administrative Agent located at 270 Park Avenue, New York, New York 10017 or
at such other place and time specified by the Administrative Agent.

     SECTION 3. DOMESTIC SUBSIDIARY GUARANTEE

     3.1. Domestic Subsidiary Guarantee

     (a) Each of the Guarantors hereby, jointly and severally, unconditionally and irrevocably,
guarantees to the Administrative Agent, for the ratable benefit of the Secured Parties and their
respective successors, indorsees, transferees and assigns, the prompt and complete payment and
performance by the Borrower when due (whether at the stated maturity, by acceleration or otherwise)
of the Borrower Obligations and the Borrower’s Guarantor Obligations.

 

9

     (b) Anything herein or in any other Loan Document to the contrary notwithstanding, the maximum
liability of each Guarantor hereunder and under the other Loan Documents shall in no event exceed
the amount which can be guaranteed by such Guarantor under applicable federal and state laws
relating to the insolvency of debtors (after giving effect to the right of contribution established
in Section 3.2).

     (c) Each Guarantor agrees that the Borrower Obligations and the Borrower’s Guarantor
Obligations either solely or collectively, may at any time and from time to time exceed the amount
of the liability of such Guarantor hereunder without impairing the guarantee contained in this
Section 3 or affecting the rights and remedies of the Administrative Agent or any Lender hereunder.

     (d) The guarantees contained in this Section 3 shall remain in full force and effect until all
the Borrower Obligations and the Borrower’s Guarantor Obligations and the obligations of each
Guarantor under the guarantees contained in this Section 3 shall have been satisfied by payment in
full, no Letter of Credit shall be outstanding and the Commitments and Loans shall be terminated,
notwithstanding that from time to time during the term of the Credit Agreement, the Borrower may be
free from any Borrower Obligations and any Borrower’s Guarantor Obligations.

     (e) No payment made by the Borrower, any of the Guarantors, any other guarantor or any other
Person or received or collected by the Administrative Agent or any Lender from the Borrower, any of
the Guarantors, any other guarantor or any other Person by virtue of any action or proceeding or
any set-off or appropriation or application at any time or from time to time in reduction of or in
payment of the Borrower Obligations or the Borrower’s Guarantor Obligations shall be deemed to
modify, reduce, release or otherwise affect the liability of any Guarantor hereunder which shall,
notwithstanding any such payment (other than any payment made by such Guarantor in respect of the
Borrower Obligations or the Borrower’s Guarantor Obligations or any payment received or collected
from such Guarantor in respect of the Borrower Obligations or the Borrower’s Guarantor Obligations)
remain liable for the Borrower Obligations and the Borrower’s Guarantor Obligations up to the
maximum liability of such Guarantor hereunder until the Borrower Obligations and the Borrower’s
Guarantor Obligations are paid in full, no Letter of Credit shall be outstanding and the
Commitments and Loans are terminated.

     3.2. Right of Contribution. Each Guarantor hereby agrees that to the extent that a
Guarantor shall have paid more than its proportionate share of any payment made hereunder, such
Guarantor shall be entitled to seek and receive contribution from and against any other Guarantor
hereunder which has not paid its proportionate share of such payment. Each Guarantor’s right of
contribution shall be subject to the terms and
conditions of Section 3.3. The provisions of this Section 3.2 shall in no respect limit the
obligations and liabilities of any Guarantor to the Administrative Agent and the Lenders, and each
Guarantor shall remain liable to the Administrative Agent and the Lenders for the full amount
guaranteed by such Guarantor hereunder.

     3.3. No Subrogation. Notwithstanding any payment made by any Guarantor hereunder or
any set-off or application of funds of any Guarantor by the Administrative Agent or any Lender, no
Guarantor shall be entitled to be subrogated to any of the rights of the Administrative Agent or
any Lender against the Borrower or any other Guarantor or any collateral security or guarantee or
right of offset held by the Administrative Agent or any Lender for the payment of the Borrower
Obligations or the Borrower’s Guarantor Obligations nor shall any Guarantor seek or be entitled to
seek any contribution or reimbursement from the Borrower or any other Guarantor in respect of
payments made by such Guarantor hereunder, until all amounts owing to the Administrative Agent and
the Lenders by the Borrower on account of the Borrower Obligations and the Borrower’s Guarantor
Obligations are paid in full, no Letter of Credit shall be outstanding and the Commitments and
Loans are terminated. If any amount shall be

 

10

paid to any Guarantor on account of such subrogation
rights at any time when all of the Borrower Obligations and the Borrower’s Guarantor Obligations
shall not have been paid in full, such amount shall be held by such Guarantor in trust for the
Administrative Agent and the Lenders, segregated from other funds of such Guarantor, and shall,
forthwith upon receipt by such Guarantor, be turned over to the Administrative Agent in the exact
form received by such Guarantor (duly indorsed by such Guarantor to the Administrative Agent, if
required), to be applied against the Borrower Obligations and the Borrower’s Guarantor Obligations,
whether matured or unmatured, in such order as the Administrative Agent may determine.

     3.4. Amendments, etc. with respect to the Borrower Obligations and the Borrower’s
Guarantor Obligations. Each Guarantor shall remain obligated hereunder notwithstanding that,
without any reservation of rights against any Guarantor and without notice to or further assent by
any Guarantor, any demand for payment of any of the Borrower Obligations or the Borrower’s
Guarantor Obligations made by the Administrative Agent or any Lender may be rescinded by the
Administrative Agent or such Lender and any of the Borrower Obligations and the Borrower’s
Guarantor Obligations continued, and the Borrower Obligations and the Borrower’s Guarantor
Obligations or the liability of any other Person upon or for any part thereof, or any collateral
security or guarantee therefor or right of offset with respect thereto, may, from time to time, in
whole or in part, be renewed, extended, amended, modified, accelerated, compromised, waived,
surrendered or released by the Administrative Agent or any Lender, and the Credit Agreement and the
other Loan Documents and any other documents executed and delivered in connection therewith may be
amended, modified, supplemented or terminated, in whole or in part, as the Administrative Agent (or
the Required Lenders or all Lenders, as the case may be) may deem advisable from time to time, and
any collateral security, guarantee or right of offset at any time held by the Administrative Agent
or any Lender for the payment of the Borrower Obligations or the Borrower’s Guarantor Obligations
may be sold, exchanged, waived, surrendered or released. Neither the Administrative Agent nor any
Lender shall have any obligation to protect, secure, perfect or insure any Lien at any time held by
it as security for the Borrower Obligations or the Borrower’s Guarantor Obligations or for the
guarantee contained in this Section 3 or any property subject thereto.

     3.5. Guarantees Absolute and Unconditional. Each Guarantor waives any and all
notice of the creation, renewal, extension or accrual of
any of the Borrower Obligations or Borrower’s Guarantor Obligations and notice of or proof of
reliance by the Administrative Agent or any Lender upon any of the guarantees contained in this
Section 3 or acceptance of the guarantees contained in this Section 3; the Borrower Obligations and
the Borrower’s Guarantor Obligations and any of them, shall conclusively be deemed to have been
created, contracted or incurred, or renewed, extended, amended or waived, in reliance upon the
guarantee contained in this Section 3; and all dealings between the Borrower and any of the
Guarantors, on the one hand, and the Administrative Agent and the Lenders, on the other hand,
likewise shall be conclusively presumed to have been had or consummated in reliance upon the
guarantee contained in this Section 3. Each Guarantor waives diligence, presentment, protest,
demand for payment and notice of default or nonpayment to or upon the Borrower or any of the
Guarantors with respect to the Borrower Obligations and the Borrower’s Guarantor Obligations. Each
Guarantor understands and agrees that the guarantees contained in this Section 3 shall be construed
as a continuing, absolute and unconditional guarantee of payment without regard to (a) the validity
or enforceability of the Credit Agreement or any other Loan Document, any of the Borrower
Obligations or the Borrower’s Guarantor Obligations or any other collateral security therefor or
guarantee or right of offset with respect thereto at any time or from time to time held by the
Administrative Agent or any Lender, (b) any defense, set-off or counterclaim (other than a defense
of payment or performance) which may at any time be available to or be asserted by the Borrower or
any other Person against the Administrative Agent or any Lender, or (c) any other circumstance
whatsoever (with or without notice to or knowledge of the Borrower or such Guarantor) which
constitutes, or might be construed to constitute, an equitable or legal discharge of the Borrower
for the Borrower Obligations or the Borrower’s Guarantor Obligations, or of

 

11

such Guarantor under
the guarantee contained in this Section 3, in bankruptcy or in any other instance. When making any
demand hereunder or otherwise pursuing its rights and remedies hereunder against any Guarantor, the
Administrative Agent or any Lender may, but shall be under no obligation to, make a similar demand
on or otherwise pursue such rights and remedies as it may have against the Borrower, any other
Guarantor or any other Person or against any collateral security or guarantee for the Borrower
Obligations or the Borrower’s Guarantor Obligations or any right of offset with respect thereto,
and any failure by the Administrative Agent or any Lender to make any such demand, to pursue such
other rights or remedies or to collect any payments from the Borrower, any other Guarantor or any
other Person or to realize upon any such collateral security or guarantee or to exercise any such
right of offset, or any release of the Borrower, any other Guarantor or any other Person or any
such collateral security, guarantee or right of offset, shall not relieve any Guarantor of any
obligation or liability hereunder, and shall not impair or affect the rights and remedies, whether
express, implied or available as a matter of law, of the Administrative Agent or any Lender against
any Guarantor. For the purposes hereof “demand” shall include the commencement and continuance of
any legal proceedings.

     3.6. Reinstatement. The guarantees contained in this Section 3 shall continue to be
effective, or be reinstated, as the case may be, if at any time payment, or any part thereof, of
any of the Borrower Obligations or the Borrower’s Guarantor Obligations, is rescinded or must
otherwise be restored or returned by the Administrative Agent or any Lender upon the insolvency,
bankruptcy, dissolution, liquidation or reorganization of the Borrower or any Guarantor, or upon or
as a result of the appointment of a receiver, intervenor or conservator of, or trustee or similar
officer for, the Borrower or any Guarantor or any substantial part of its property, or otherwise,
all as though such payments had not been made.

     3.7. Payments. Each Guarantor hereby guarantees that payments hereunder will be paid
to the Administrative Agent without set-off or counterclaim in Dollars or the applicable Optional
Currency at
the office of the Administrative Agent located at 270 Park Avenue, New York, New York 10017 or
at such other place and time specified by the Administrative Agent.

     SECTION 4. GRANT OF SECURITY INTEREST

     Subject to Section 9.15, each Grantor hereby assigns and transfers to the Administrative
Agent, and hereby grants to the Administrative Agent, for the ratable benefit of the Secured
Parties, a security interest in, all of the following property now owned or at any time hereafter
acquired by such Grantor or in which such Grantor now has or at any time in the future may acquire
any right, title or interest (collectively, the “Collateral”), as collateral security for
the prompt and complete payment and performance when due (whether at the stated maturity, by
acceleration or otherwise) of such Grantor’s Obligations:

     (a) all Receivables;

     (b) all Equipment;

     (c) all Inventory;

     (d) all Pledged Stock;

     (e) all books and records pertaining to the Collateral; and

 

12

     (f) to the extent not otherwise included, all Proceeds, Supporting Obligations and products of
any and all of the foregoing and all collateral security and guarantees given by any Person with
respect to any of the foregoing.

     Notwithstanding the limitation on the inclusions of Foreign Subsidiary Voting Stock in the
definition of Pledged Stock, the remaining 35% of the outstanding Foreign Subsidiary Voting Stock
of any Foreign Subsidiary Borrower shall be pledged and subject to a grant of a security interest
therein subject to this Section 4; provided that such pledge and grant shall only secure
the obligations of such Foreign Subsidiary Borrower in its capacity as such under the Credit
Agreement; provided further, that notwithstanding any of the other provisions set
forth in this Section 4, this Agreement shall not constitute a grant of a security interest in any
property to the extent that such grant of a security interest is prohibited by any Requirements of
Law of a Governmental Authority, requires a consent not obtained of any Governmental Authority
pursuant to such Requirement of Law or is prohibited by, or constitutes a breach or default under
or results in the termination of or requires any consent not obtained under, any contract, license,
agreement, instrument or other document evidencing or giving rise to such property or, in the case
of any Pledged Stock, any applicable shareholder or similar agreement, except to the extent that
such Requirement of Law or the term in such contract, license, agreement, instrument or other
document or shareholder or similar agreement providing for such prohibition, breach, default or
termination or requiring such consent is ineffective under applicable law.

     SECTION 5. REPRESENTATIONS AND WARRANTIES

     To induce the Administrative Agent and the Lenders to enter into the Credit Agreement and to
induce the Lenders to make their respective extensions of credit to the Borrower and each
Subsidiary Borrower thereunder, each Grantor hereby represents and warrants to the Administrative
Agent and each Lender that other than during any Unsecured Period:

     5.1. Title; No Other Liens. Except for the security interest granted to the
Administrative Agent for the ratable benefit of the Secured Parties pursuant to this Agreement and
the other Liens permitted to exist on the Collateral by the Credit Agreement, such Grantor owns
each item of the Collateral free and clear of any and all Liens or claims of others. No financing
statement or other public notice with respect to all or any part of the Collateral is on file or of
record in any public office, except such as have been filed in favor of the Administrative Agent,
for the ratable benefit of the Secured Parties, pursuant to this Agreement or as are permitted by
the Credit Agreement.

     5.2. Perfected First Priority Liens. The security interests granted pursuant to this
Agreement will constitute valid perfected security interests in all of the Collateral in favor of
the Administrative Agent, for the ratable benefit of the Secured Parties, as collateral security
for such Grantor’s Obligations, enforceable in accordance with the terms hereof against all
creditors of such Grantor and any Persons purporting to purchase any Collateral from such Grantor
(other than Inventory sold by such Grantor in the ordinary course of business and except as
otherwise permitted by the Credit Agreement), to the extent that perfection or enforceability
against third parties is obtainable by completion of the filings and other actions set forth on
Schedule 3 or any similar filings or other actions in other jurisdictions in the United
States of America and are prior to all other Liens on the Collateral which have priority over the
Liens on the Collateral by operation of law and other Liens on the Collateral permitted by the
Credit Agreement.

     5.3. Jurisdiction of Organization. On the Closing Date, such Grantor’s jurisdiction
of organization and identification number from the jurisdiction of organization (if any) are set
forth on Schedule 3. Such Grantor has furnished to the Administrative Agent a certified charter,
certificate of

 

13

incorporation or other organizational document and good standing certificate as of a
date which is recent to the Closing Date.

     5.4. Domestic Subsidiaries. On the Closing Date, Schedule 4 sets forth a true and
complete list of the Domestic Subsidiaries.

     5.5. Pledged Stock. 

     (a) The shares of the Pledged Stock pledged by such Grantor hereunder constitute all the
issued and outstanding shares of all classes of the Capital Stock of each Issuer owned by such
Grantor or, in the case of Foreign Subsidiary Voting Stock, if less, 65% of the outstanding Foreign
Subsidiary Voting Stock of each relevant Issuer.

     (b) All the shares of the Pledged Stock have been duly and validly issued and are fully paid
and nonassessable.

     (c) Such Grantor is the record and beneficial owner of, and has good and marketable title to,
the Pledged Stock pledged by it hereunder, free of any and all Liens or options in favor of, or
claims of, any other Person, except the security interest created by this Agreement and except as
permitted under subsection 7.1 of the Credit Agreement.

     5.6. Receivables. During any Full Security Period,

     (a) None of the obligors on any Receivables is a Governmental Authority.

     (b) The amounts represented by such Grantor to the Lenders from time to time as owing to such
Grantor in respect of the Receivables will at such times be accurate in all material respects.

     SECTION 6. COVENANTS

     Each Grantor covenants and agrees with the Administrative Agent and the Lenders that, from and
after the date of this Agreement until the Obligations shall have been paid in full, no Letter of
Credit shall be outstanding and the Commitments and Loans shall have terminated, other than during
any Unsecured Period, 

     6.1. Delivery of Certificated Securities. If any amount payable under or in
connection with any of the Collateral shall be or become evidenced by any Certificated Security,
such Certificated Security shall be immediately delivered to the Administrative Agent, duly
indorsed (including by delivery of related stock powers) in a manner satisfactory to the
Administrative Agent, to be held as Collateral pursuant to this Agreement.

     6.2. Maintenance of Insurance. During any Full Security Period,

     (a) Such Grantor will maintain, with financially sound and reputable companies, insurance
policies (i) insuring the Inventory and Equipment against loss by fire, explosion, theft and such
other casualties as may be reasonably satisfactory to the Administrative Agent and (ii) to the
extent requested by the Administrative Agent, insuring such Grantor, the Administrative Agent and
the Lenders against liability for personal injury and property damage relating to such Inventory
and Equipment, such policies to be in such form and amounts and having such coverage as may be
reasonably satisfactory to the Administrative Agent and the Lenders.

 

14

     (b) All such insurance shall (i) provide that no cancellation, material reduction in amount or
material change in coverage thereof shall be effective until at least 30 days after receipt by the
Administrative Agent of written notice thereof, (ii) name the Administrative Agent as insured party
or loss payee, (iii) if reasonably requested by the Administrative Agent, include a breach of
warranty clause and (iv) be reasonably satisfactory in all other respects to the Administrative
Agent.

     (c) The Borrower shall deliver to the Administrative Agent and the Lenders a report of a
reputable insurance broker with respect to such insurance substantially concurrently with each
delivery of the Borrower’s audited annual financial statements and such supplemental reports with
respect thereto as the Administrative Agent may from time to time reasonably request.

     6.3. Payment of Obligations. Such Grantor will pay and discharge or otherwise satisfy
at or before maturity or before they become delinquent, as the case may be, all taxes, assessments
and governmental charges or levies imposed upon the Collateral or in respect of income or profits
therefrom, as well as all claims of any kind against or with respect to the Collateral, except that
no such charge need be paid if the amount or validity thereof is currently being contested in good
faith by appropriate proceedings, reserves in conformity with GAAP with respect thereto have been
provided on the books of such Grantor and such proceedings could
not reasonably be expected to result in the sale, forfeiture or loss of any material portion
of the Collateral or any interest therein.

     6.4. Maintenance of Perfected Security Interest; Further Documentation. Such Grantor
shall maintain the security interest created by this Agreement as a perfected security interest
having at least the priority described in Section 5.2 and shall defend such security interest
against the claims and demands of all Persons whomsoever.

     6.5. Notices. Such Grantor will advise the Administrative Agent and the Lenders
promptly, in reasonable detail, of:

     (a) any Lien (other than security interests created hereby or Liens permitted under the Credit
Agreement) on any of the Collateral which would adversely affect the ability of the Administrative
Agent to exercise any of its remedies hereunder; and

     (b) of the occurrence of any other event which could reasonably be expected to have a material
adverse effect on the aggregate value of the Collateral or on the security interests created
hereby.

     (c) At any time and from time to time, upon the written request of the Administrative Agent,
and at the sole expense of such Grantor, such Grantor will promptly and duly execute and deliver,
and have recorded, such further instruments and documents and take such further actions as the
Administrative Agent may reasonably request for the purpose of obtaining or preserving the full
benefits of this Agreement and of the rights and powers herein granted, including, without
limitation, (i) filing any financing or continuation statements under the Uniform Commercial Code
(or other similar laws) in effect in any jurisdiction with respect to the security interests
created hereby and (ii) in the case of Pledged Stock and any other relevant Collateral, taking any
actions necessary to enable the Administrative Agent to obtain “control” (within the meaning of the
applicable Uniform Commercial Code) with respect thereto.

     6.6. Pledged Stock

     (a) If such Grantor shall become entitled to receive or shall receive any stock certificate
(including, without limitation, any certificate representing a stock dividend or a distribution in
connection

 

15

with any reclassification, increase or reduction of capital or any certificate issued in
connection with any reorganization), option or rights in respect of the Capital Stock of any Issuer
which is a direct or indirect Domestic Subsidiary of such Grantor and which is Pledged Stock,
whether in addition to, in substitution of, as a conversion of, or in exchange for, any shares of
the Pledged Stock, or otherwise in respect thereof, such Grantor shall accept the same as the agent
of the Administrative Agent and the Lenders, hold the same in trust for the Administrative Agent
and the Lenders and deliver the same forthwith to the Administrative Agent in the exact form
received, duly indorsed (including by delivery of related stock or bond powers) by such Grantor to
the Administrative Agent, if required, together with an undated stock power covering such
certificate duly executed in blank by such Grantor to be held by the Administrative Agent, subject
to the terms hereof, as additional collateral security for such Grantor’s Obligations. Any sums
paid upon or in respect of the Collateral upon the liquidation or dissolution of any Issuer shall
be paid over to the Administrative Agent to be held by it hereunder as additional collateral
security for the
applicable Grantor’s Obligations, and in case any distribution of capital shall be made on or
in respect of the Collateral or any property shall be distributed upon or with respect to the
Collateral pursuant to the recapitalization or reclassification of the capital of any Issuer or
pursuant to the reorganization thereof, the property so distributed shall, unless otherwise subject
to a perfected security interest in favor of the Administrative Agent, be delivered to the
Administrative Agent to be held by it hereunder as additional collateral security for such
Obligations except to the extent permitted under Subsection 6.3. If any sums of money or property
so paid or distributed in respect of the Collateral shall be received by such Grantor, such Grantor
shall, until such money or property is paid or delivered to the Administrative Agent, hold such
money or property in trust for the Lenders, segregated from other funds of such Grantor, as
additional collateral security for the Obligations.

     Without the prior written consent of the Administrative Agent or unless permitted by the
Credit Agreement, such Grantor will not (i) vote to enable, or take any other action to permit, any
Issuer to issue any stock or other equity securities of any nature or to issue any other securities
convertible into or granting the right to purchase or exchange for any stock or other equity
securities of any nature of any Issuer, (ii) sell, assign, transfer, exchange, or otherwise dispose
of, or grant any option with respect to, the Collateral (except pursuant to a transaction
permitted by the Credit Agreement), (iii) create, incur or permit to exist any Lien or option in
favor of, or any claim of any Person with respect to, any of the Collateral, or any interest
therein, except for the security interests created by this Agreement or (iv) enter into any
agreement or undertaking restricting the right or ability of such Grantor or the Administrative
Agent to sell, assign or transfer any of the Collateral.

     In the case of each Grantor which is an Issuer, such Issuer agrees that (i) it will be bound
by the terms of this Agreement relating to the Pledged Stock issued by it and will comply with such
terms insofar as such terms are applicable to it, (ii) it will notify the Administrative Agent
promptly in writing of the occurrence of any of the events described in Section 6.4(a) with respect
to the Pledged Stock issued by it and (iii) the terms of Sections 7.3(c) and 7.7 shall apply to it,
mutatis mutandis, with respect to all actions that may be required of it pursuant
to Section 7.3(c) or 7.7 with respect to the Pledged Stock issued by it.

     6.7. Receivables. During any Full Security Period,

     (a) Other than in the ordinary course of business consistent with its past practice, such
Grantor will not (i) grant any extension of the time of payment of any Receivable, (ii) compromise
or settle any Receivable for less than the full amount thereof, (iii) release, wholly or partially,
any Person liable for the payment of any Receivable, (iv) allow any credit or discount whatsoever
on any Receivable or (v) amend, supplement or modify any Receivable in any manner that could
materially adversely affect the value thereof.

 

16

     (b) Such Grantor will deliver to the Administrative Agent a copy of each material demand,
notice or document received by it that questions or calls into doubt the validity or enforceability
of more than 5% of the aggregate amount of the then outstanding Receivables.

     (c) Anything contained in this Agreement to the contrary notwithstanding, the Grantors, or any
of them, shall have the right to enter into one or more Receivables Purchase Facilities, as
contemplated by the Credit Agreement, and the Administrative Agent shall execute any and all
documents reasonably necessary to release its security interest in the Receivables which become
Sold Receivables upon the consummation of such Receivables Purchase Facility(ies).

     SECTION 7. REMEDIAL PROVISIONS

     7.1. Certain Matters Relating to Receivables. During any Full Security Period,

     (a) The Administrative Agent shall have the right after the occurrence and during the
continuance of an Event of Default to make test verifications of the Receivables in any manner and
through any medium that it reasonably considers advisable, and each Grantor shall furnish all such
assistance and information as the Administrative Agent may require in connection with such test
verifications. At any time and from time to time, after the occurrence and during the continuance
of an Event of Default, upon the Administrative Agent’s request and at the expense of the relevant
Grantor, such Grantor shall cause independent public accountants or others satisfactory to the
Administrative Agent to furnish to the Administrative Agent reports showing reconciliations, aging
and test verifications of, and trial balances for, the Receivables.

     (b) The Administrative Agent hereby authorizes each Grantor to collect such Grantor’s
Receivables, and the Administrative Agent may curtail or terminate said authority at any time after
the occurrence and during the continuance of an Event of Default. If required by the
Administrative Agent at any time after the occurrence and during the continuance of an Event of
Default, any payments of Receivables, when collected by any Grantor, (i) shall be forthwith (and,
in any event, within two Business Days) deposited by such Grantor in the exact form received, duly
indorsed by such Grantor to the Administrative Agent if required, in a Collateral Account
maintained under the sole dominion and control of the Administrative Agent, subject to withdrawal
by the Administrative Agent for the account of the Lenders only as provided in Section 7.5, and
(ii) until so turned over, shall be held by such Grantor in trust for the Administrative Agent and
the Lenders, segregated from other funds of such Grantor. Each such deposit of Proceeds of
Receivables shall be accompanied by a report identifying in reasonable detail the nature and source
of the payments included in the deposit.

     (c) At the Administrative Agent’s request, after the occurrence and during the continuance of
an Event of Default, each Grantor shall deliver to the Administrative Agent all original and other
documents evidencing, and relating to, the agreements and transactions which gave rise to the
Receivables, including, without limitation, all original orders, invoices and shipping receipts.

     7.2. Communications with Obligors; Grantors Remain Liable. During any Full Security
Period,

     (a) The Administrative Agent in its own name or in the name of others may at any time after
the occurrence and during the continuance of an Event of Default communicate with obligors under
the Receivables to verify with them to the Administrative Agent’s satisfaction the existence,
amount and terms of any Receivables.

 

17

     (b) Upon the written request of the Administrative Agent at any time after the occurrence and
during the continuance of an Event of Default, each Grantor shall notify obligors on its
Receivables that the Receivables have been assigned to the Administrative Agent for the ratable
benefit of the Secured Parties and that payments in respect thereof shall be made directly to the
Administrative Agent.

     (c) Anything herein to the contrary notwithstanding, each Grantor shall remain liable under
each of its Receivables to observe and perform all the conditions and obligations to be observed
and performed by it thereunder, all in accordance with the terms of any agreement giving rise
thereto. Neither the Administrative Agent nor any Lender shall have any obligation or liability
under any Receivable (or any agreement giving rise thereto) by reason of or arising out of this
Agreement or the receipt by the Administrative Agent or any Lender of any payment relating thereto,
nor shall the Administrative Agent or any Lender be obligated in any manner to perform any of the
obligations of any Grantor under or pursuant to any Receivable (or any agreement giving rise
thereto), to make any payment, to make any inquiry as to the nature or the sufficiency of any
payment received by it or as to the sufficiency of any performance by any party thereunder, to
present or file any claim, to take any action to enforce any performance or to collect the payment
of any amounts which may have been assigned to it or to which it may be entitled at any time or
times.

     7.3. Pledged Stock

     (a) Unless an Event of Default shall have occurred and be continuing and the Administrative
Agent shall have given notice to the relevant Grantor of the Administrative Agent’s intent to
exercise its corresponding rights pursuant to Section 7.3(b), each Grantor shall be permitted to
receive all cash dividends paid in respect of the Pledged Stock, in each case paid in the normal
course of business of the relevant Issuer and consistent with past practice, to the extent
permitted in the Credit Agreement, to pay and declare dividends to the extent permitted by the
Credit Agreement and to exercise all voting and corporate rights with respect to the Pledged Stock;
provided, however, that no vote shall be cast or corporate right exercised or other
action taken which, in the Administrative Agent’s reasonable judgment, would impair the Collateral
or which would be inconsistent with or result in any violation of any provision of the Credit
Agreement, this Agreement or any other Loan Document.

     (b) If an Event of Default shall occur and be continuing and the Administrative Agent shall
give written notice of its intent to exercise such rights to the relevant Grantor or Grantors, (i)
the Administrative Agent shall have the right to receive any and all cash dividends, payments or
other Proceeds paid in respect of the Pledged Stock and make application thereof to the Obligations
in such order as the Administrative Agent may determine, and (ii) any or all of the Pledged Stock
shall be registered in the name of the Administrative Agent or its nominee, and the Administrative
Agent or its nominee may thereafter exercise (x) all voting, corporate and other rights pertaining
to such Pledged Stock at any meeting of shareholders of the relevant Issuer or Issuers or otherwise
and (y) any and all rights of conversion, exchange and subscription and any other rights,
privileges or options pertaining to such Pledged Stock as if it were the absolute owner thereof
(including, without limitation, the right to exchange at its discretion any and all of the Pledged
Stock upon the merger, consolidation, reorganization, recapitalization or other fundamental change
in the corporate structure of any Issuer, or upon the exercise by any Grantor or the Administrative
Agent of any right, privilege or option pertaining to such Pledged Stock, and in connection
therewith, the right to deposit and deliver any and all of the Pledged Stock with any committee,
depositary, transfer agent, registrar or other designated agency upon such terms and conditions as
the Administrative Agent may determine), all without liability except to account for property
actually received by it, but the Administrative Agent shall have no duty to any Grantor to exercise
any such right, privilege or option and shall not be responsible for any failure to do so or delay
in so doing.

 

18

     (c) Each Grantor hereby authorizes and instructs each Issuer of any Pledged Stock pledged by
such Grantor hereunder to (i) comply with any instruction received by it from the Administrative
Agent in writing that (x) states that an Event of Default has occurred and is continuing and (y) is
otherwise in accordance with the terms of this Agreement, without any other or further instructions
from such Grantor, and each Grantor agrees that each Issuer shall be fully protected in so
complying, and
(ii) unless otherwise expressly permitted hereby, pay any dividends or other payments with
respect to the Pledged Stock directly to the Administrative Agent.

     7.4. Proceeds to be Turned Over To Administrative Agent. If an Event of Default
shall occur and be continuing, all Proceeds received by any Grantor consisting of cash, checks and
other near-cash items shall be held by such Grantor in trust for the Administrative Agent and the
Lenders, segregated from other funds of such Grantor, and shall, forthwith upon receipt by such
Grantor, be turned over to the Administrative Agent in the exact form received by such Grantor
(duly indorsed by such Grantor to the Administrative Agent, if required). All Proceeds received by
the Administrative Agent hereunder shall be held by the Administrative Agent in a Collateral
Account maintained under its sole dominion and control. All Proceeds while held by the
Administrative Agent in a Collateral Account (or by such Grantor in trust for the Administrative
Agent and the Lenders) shall continue to be held as collateral security for all the Obligations and
shall not constitute payment thereof until applied as provided in Section 7.7.

     7.5. Application of Proceeds. At such intervals as may be agreed upon by the Borrower
and the Administrative Agent, or, if an Event of Default shall have occurred and be continuing, at
any time at the Administrative Agent’s election, the Administrative Agent may apply all or any part
of Proceeds constituting Collateral, whether or not held in any Collateral Account, and any
proceeds of the guarantee set forth in Section 2, in payment of the Obligations in the following
order:

     First, to pay incurred and unpaid fees and expenses of the Administrative Agent under the Loan
Documents;

     Second, to the Administrative Agent, for application by it towards payment of amounts then due
and owing and remaining unpaid in respect of the Obligations, pro rata among the Secured Parties
according to the amounts of the Obligations then due and owing and remaining unpaid to the Lenders;

     Third, to the Administrative Agent, for application by it towards prepayment of the
Obligations, pro rata among the Secured Parties according to the amounts of the Obligations then
held by the Lenders; and

     Fourth, any balance remaining after the Obligations shall have been paid in full, no Letters
of Credit shall be outstanding and the Commitments shall have been terminated shall be paid over to
the Borrower or to whomsoever may be lawfully entitled to receive the same.

     7.6. Code and Other Remedies. If an Event of Default shall occur and be continuing,
the Administrative Agent, on behalf of the Lenders, may exercise, in addition to all other rights
and remedies granted to them in this Agreement and in any other instrument or agreement securing,
evidencing or relating to the Obligations, all rights and remedies of a secured party under the New
York UCC or any other applicable law. Without limiting the generality of the foregoing, the
Administrative Agent, without demand of performance or other demand, presentment, protest,
advertisement or notice of any kind (except any notice required by law referred to below) to or
upon any Grantor or any other Person (all and each of which demands, defenses, advertisements and
notices are hereby waived), may in such circumstances forthwith collect, receive, appropriate and
realize upon the Collateral, or any part thereof,

 

19

and/or may forthwith sell, lease,
assign, give option or options to purchase, or otherwise dispose of and deliver the Collateral
or any part thereof (or contract to do any of the foregoing), in one or more parcels at public or
private sale or sales, at any exchange, broker’s board or office of the Administrative Agent or any
Lender or elsewhere upon such terms and conditions as it may deem advisable and at such prices as
it may deem best, for cash or on credit or for future delivery without assumption of any credit
risk. The Administrative Agent or any Lender shall have the right upon any such public sale or
sales, and, to the extent permitted by law, upon any such private sale or sales, to purchase the
whole or any part of the Collateral so sold, free of any right or equity of redemption in any
Grantor, which right or equity is hereby waived and released. Each Grantor further agrees, at the
Administrative Agent’s request, to assemble the Collateral and make it available to the
Administrative Agent at places which the Administrative Agent shall reasonably select, whether at
such Grantor’s premises or elsewhere. The Administrative Agent shall apply the net proceeds of any
action taken by it pursuant to this Section 7.6, after deducting all reasonable costs and expenses
of every kind incurred in connection therewith or incidental to the care or safekeeping of any of
the Collateral or in any way relating to the Collateral or the rights of the Administrative Agent
and the Lenders hereunder, including, without limitation, reasonable attorneys’ fees and
disbursements, to the payment in whole or in part of the Obligations, in such order as the
Administrative Agent may elect, and only after such application and after the payment by the
Administrative Agent of any other amount required by any provision of law, including, without
limitation, Section 9-615(a)(3) of the New York UCC, need the Administrative Agent account for the
surplus, if any, to any Grantor. To the extent permitted by applicable law, each Grantor waives
all claims, damages and demands it may acquire against the Administrative Agent or any Lender
arising out of the exercise by them of any rights hereunder. If any notice of a proposed sale or
other disposition of Collateral shall be required by law, such notice shall be deemed reasonable
and proper if given at least 10 days before such sale or other disposition.

     7.7. Registration Rights

     (a) If the Administrative Agent shall determine to exercise its right to sell any or all of
the Pledged Stock pursuant to Section 7.6, and if in the opinion of the Administrative Agent it is
necessary or advisable to have the Pledged Stock, or that portion thereof to be sold, registered
under the provisions of the Securities Act, the relevant Grantor will cause the Issuer thereof to
(i) execute and deliver, and cause the directors and officers of such Issuer to execute and
deliver, all such instruments and documents, and do or cause to be done all such other acts as may
be, in the opinion of the Administrative Agent, necessary or advisable to register the Pledged
Stock, or that portion thereof to be sold, under the provisions of the Securities Act, (ii) use its
best efforts to cause the registration statement relating thereto to become effective and to remain
effective for a period of one year from the date of the first public offering of the Pledged Stock,
or that portion thereof to be sold, and (iii) make all amendments thereto and/or to the related
prospectus which, in the opinion of the Administrative Agent, are necessary or advisable, all in
conformity with the requirements of the Securities Act and the rules and regulations of the
Securities and Exchange Commission applicable thereto. Each Grantor agrees to cause such Issuer to
comply with the provisions of the securities or “Blue Sky” laws of any and all jurisdictions which
the Administrative Agent shall designate and to make available to its security holders, as soon as
practicable, an earnings statement (which need not be audited) which will satisfy the provisions of
Section 11(a) of the Securities Act.

     (b) Each Grantor recognizes that the Administrative Agent may be unable to effect a public
sale of any or all the Pledged Stock, by reason of certain prohibitions contained in the Securities
Act and applicable state securities laws or otherwise, and may be compelled to resort to one or
more private sales thereof to a restricted group of purchasers which will be obliged to agree,
among other things, to acquire such securities for their own account, for investment and not with a
view to the distribution or resale thereof. Each Grantor acknowledges and agrees that any such
private sale may

 

20

result in prices and other terms less favorable than if such sale were a public
sale and, notwithstanding
such circumstances, agrees that any such private sale shall be deemed to have been made in a
commercially reasonable manner. The Administrative Agent shall be under no obligation to delay a
sale of any of the Pledged Stock for the period of time necessary to permit the Issuer thereof to
register such securities for public sale under the Securities Act, or under applicable state
securities laws, even if such Issuer would agree to do so.

     (c) Each Grantor agrees to use its best efforts to do or cause to be done all such other acts
as may be necessary to make such sale or sales of all or any portion of the Pledged Stock pursuant
to this Section 7.7 valid and binding and in compliance with any and all other applicable
Requirements of Law. Each Grantor further agrees that a breach of any of the covenants contained
in this Section 7.7 will cause irreparable injury to the Administrative Agent and the Lenders, that
the Administrative Agent and the Lenders have no adequate remedy at law in respect of such breach
and, as a consequence, that each and every covenant contained in this Section 7.7 shall be
specifically enforceable against such Grantor, and such Grantor hereby waives and agrees not to
assert any defenses against an action for specific performance of such covenants except for a
defense that no Event of Default has occurred under the Credit Agreement.

     7.8. Deficiency. Grantor shall remain liable for any deficiency if the proceeds of
any sale or other disposition of the Collateral are insufficient to pay its Obligations and the
fees and disbursements of any attorneys employed by the Administrative Agent or any Lender to
collect such deficiency.

     SECTION 8. THE ADMINISTRATIVE AGENT

     8.1. Administrative Agent’s Appointment as Attorney-in-Fact, etc

     (a) Each Grantor hereby irrevocably constitutes and appoints the Administrative Agent and any
officer or agent thereof, with full power of substitution, as its true and lawful attorney-in-fact
with full irrevocable power and authority in the place and stead of such Grantor and in the name of
such Grantor or in its own name, for the purpose of carrying out the terms of this Agreement, to
take any and all appropriate action and to execute any and all documents and instruments which may
be necessary or desirable to accomplish the purposes of this Agreement, and, without limiting the
generality of the foregoing, each Grantor hereby gives the Administrative Agent the power and
right, on behalf of such Grantor, without notice to or assent by such Grantor, to do any or all of
the following:

     (i) in the name of such Grantor or its own name, or otherwise, take possession of and
indorse and collect any checks, drafts, notes, acceptances or other instruments for the
payment of moneys due under any Receivable or with respect to any other Collateral and file
any claim or take any other action or proceeding in any court of law or equity or otherwise
deemed appropriate by the Administrative Agent for the purpose of collecting any and all
such moneys due under any Receivable or with respect to any other Collateral whenever
payable;

     (ii) pay or discharge taxes and Liens levied or placed on or threatened against the
Collateral, effect any repairs or any insurance called for by the terms of this Agreement
and pay all or any part of the premiums therefor and the costs thereof;

     (iii) execute, in connection with any sale provided for in Section 7.6 or 7.7, any
indorsements, assignments or other instruments of conveyance or transfer with respect to the
Collateral; and

 

21

     (iv) direct any party liable for any payment under any of the Collateral to make
payment of any and all moneys due or to become due thereunder directly to the Administrative
Agent or as the Administrative Agent shall direct; (1) ask or demand for, collect, and
receive payment of and receipt for, any and all moneys, claims and other amounts due or to
become due at any time in respect of or arising out of any Collateral; (2) sign and indorse
any invoices, freight or express bills, bills of lading, storage or warehouse receipts,
drafts against debtors, assignments, verifications, notices and other documents in
connection with any of the Collateral; (3) commence and prosecute any suits, actions or
proceedings at law or in equity in any court of competent jurisdiction to collect the
Collateral or any portion thereof and to enforce any other right in respect of any
Collateral; (4) defend any suit, action or proceeding brought against such Grantor with
respect to any Collateral; (5) settle, compromise or adjust any such suit, action or
proceeding and, in connection therewith, give such discharges or releases as the
Administrative Agent may deem appropriate; and (6) generally, sell, transfer, pledge and
make any agreement with respect to or otherwise deal with any of the Collateral as fully and
completely as though the Administrative Agent were the absolute owner thereof for all
purposes, and do, at the Administrative Agent’s option and such Grantor’s expense, at any
time, or from time to time, all acts and things which the Administrative Agent deems
necessary to protect, preserve or realize upon the Collateral and the Administrative Agent’s
and the Lenders’ security interests therein and to effect the intent of this Agreement, all
as fully and effectively as such Grantor might do.

     Anything in this Section 8.1(a) to the contrary notwithstanding, the Administrative Agent
agrees that it will not exercise any rights under the power of attorney provided for in this
Section 8.1(a) unless an Event of Default shall have occurred and be continuing.

     (b) If any Grantor fails to perform or comply with any of its agreements contained herein, the
Administrative Agent, at its option, but without any obligation so to do, may perform or comply, or
otherwise cause performance or compliance, with such agreement.

     (c) The expenses of the Administrative Agent incurred in connection with actions undertaken as
provided in this Section 8.1, together with interest thereon at a rate per annum equal to the
highest rate per annum at which interest would then be payable on any category of past due ABR
Loans under the Credit Agreement, from the date of payment by the Administrative Agent to the date
reimbursed by the relevant Grantor, shall be payable by such Grantor to the Administrative Agent on
demand.

     (d) Each Grantor hereby ratifies all that said attorneys shall lawfully do or cause to be done
by virtue hereof. All powers, authorizations and agencies contained in this Agreement are coupled
with an interest and are irrevocable until this Agreement is terminated and the security interests
created hereby are released.

     8.2. Duty of Administrative Agent. The Administrative Agent’s sole duty with respect
to the custody, safekeeping and physical preservation of the Collateral in its possession, under
Section 9-207 of the New York UCC or otherwise, shall be to deal with it in the same manner as the
Administrative Agent deals with similar property for its own account. Neither the Administrative
Agent, any Lender nor any of their respective officers, directors, employees or agents shall be
liable for failure to demand, collect or realize upon any of the Collateral or for any delay in
doing so or shall be under any obligation to sell or otherwise dispose of any Collateral upon the
request of any Grantor or any other Person or to take any other action whatsoever with regard to
the Collateral or any part thereof. The powers conferred on the Administrative Agent and the
Lenders hereunder are solely to protect the Administrative Agent’s and the Lenders’ interests in
the
Collateral and shall not impose any duty upon the Administrative Agent or any Lender to
exercise any such powers. The Administrative Agent and the

 

22

Lenders shall be accountable only for
amounts that they actually receive as a result of the exercise of such powers, and neither they nor
any of their officers, directors, employees or agents shall be responsible to any Grantor for any
act or failure to act hereunder, except for their own gross negligence or willful misconduct.

     8.3. Execution of Financing Statements. Pursuant to any applicable law, each Grantor
authorizes the Administrative Agent to file or record financing statements and other filing or
recording documents or instruments with respect to the Collateral without the signature of such
Grantor in such form and in such offices as the Administrative Agent determines appropriate to
perfect the security interests of the Administrative Agent under this Agreement. Each Grantor
hereby ratifies and authorizes the filing by the Administrative Agent of any financing statement
solely with respect to the Collateral made prior to the Closing Date. A photographic or other
reproduction of this Agreement shall be sufficient as a financing statement or other filing or
recording document or instrument for filing or recording in any jurisdiction.

     8.4. Authority of Administrative Agent. Each Grantor acknowledges that the rights and
responsibilities of the Administrative Agent under this Agreement with respect to any action taken
by the Administrative Agent or the exercise or non-exercise by the Administrative Agent of any
option, voting right, request, judgment or other right or remedy provided for herein or resulting
or arising out of this Agreement shall, as between the Administrative Agent and the Lenders, be
governed by the Credit Agreement and by such other agreements with respect thereto as may exist
from time to time among them, but, as between the Administrative Agent and the Grantors, the
Administrative Agent shall be conclusively presumed to be acting as agent for the Lenders with full
and valid authority so to act or refrain from acting, and no Grantor shall be under any obligation,
or entitlement, to make any inquiry respecting such authority.

     SECTION 9. MISCELLANEOUS

     9.1. Amendments in Writing. None of the terms or provisions of this Agreement may be
waived, amended, supplemented or otherwise modified except in accordance with subsection 10.1 of
the Credit Agreement.

     9.2. Notices. All notices, requests and demands to or upon the Administrative Agent
or any Grantor hereunder shall be effected in the manner provided for in subsection 10.2 of the
Credit Agreement; provided that any such notice, request or demand to or upon any Guarantor shall
be addressed to such Guarantor at its notice address set forth on Schedule 1.

     9.3. No Waiver by Course of Conduct; Cumulative Remedies. Neither the Administrative
Agent nor any Lender shall by any act (except by a written instrument pursuant to Section 9.1),
delay, indulgence, omission or otherwise be deemed to have waived any right or remedy hereunder or
to have acquiesced in any Default or Event of Default. No failure to exercise, nor any delay in
exercising, on the part of the Administrative Agent or any Lender, any right, power or privilege
hereunder shall operate as a waiver thereof. No single or partial exercise of any right,
power or privilege hereunder shall preclude any other or further exercise thereof or the
exercise of any other right, power or privilege. A waiver by the Administrative Agent or any
Lender of any right or remedy hereunder on any one occasion shall not be construed as a bar to any
right or remedy which the Administrative Agent or such Lender would otherwise have on any future
occasion. The rights and remedies herein provided are cumulative, may be exercised singly or
concurrently and are not exclusive of any other rights or remedies provided by law.

 

 

23

          9.4. Enforcement Expenses; Indemnification

          (a) Each Guarantor agrees to pay or reimburse each Lender and the Administrative Agent for all
its costs and expenses incurred in collecting against such Guarantor under the guarantees contained
in Section 2 or 3, as applicable, or otherwise enforcing or preserving any rights under this
Agreement and the other Loan Documents to which such Guarantor is a party, including, without
limitation, the reasonable fees and disbursements of counsel (including the allocated fees and
expenses of in-house counsel) to each Lender and of counsel to the Administrative Agent.

          (b) Each Guarantor agrees to pay, and to save the Administrative Agent and the Lenders
harmless from, any and all liabilities with respect to, or resulting from any delay in paying, any
and all stamp, excise, sales or other taxes which may be payable or determined to be payable with
respect to any of the Collateral or in connection with any of the transactions contemplated by this
Agreement.

          (c) Each Guarantor agrees to pay, and to save the Administrative Agent and the Lenders
harmless from, any and all liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements of any kind or nature whatsoever with respect to
the execution, delivery, enforcement, performance and administration of this Agreement to the
extent the Borrower would be required to do so pursuant to subsection 10.5 of the Credit Agreement.

          (d) The agreements in this Section 9.4 shall survive repayment of the Obligations and all
other amounts payable under the Credit Agreement and the other Loan Documents.

          9.5. Successors and Assigns. This Agreement shall be binding upon the successors and
assigns of each Grantor and shall inure to the benefit of the Administrative Agent and the Secured
Parties and their successors and assigns; provided that no Grantor may assign, transfer or delegate
any of its rights or obligations under this Agreement without the prior written consent of the
Administrative Agent.

          9.6. Set-Off. Each Grantor hereby irrevocably authorizes the Administrative Agent and
each Lender at any time and from time to time while an Event of Default shall have occurred and be
continuing, without notice to such Grantor or any other Grantor, any such notice being expressly
waived by each Grantor, to set-off and appropriate and apply any and all deposits (general or
special, time or demand, provisional or final), in any currency, and any other credits,
indebtedness or claims, in any currency, in each case whether direct or indirect, absolute or
contingent, matured or unmatured, at any time held or owing by the Administrative Agent or such
Lender to or for the credit or the account of such Grantor, or any part thereof in such amounts as
the Administrative Agent or such Lender may elect, against and on account of the obligations and
liabilities of such Grantor to the Administrative Agent or such Lender hereunder and claims of
every nature and description of the Administrative Agent or such Lender against
such Grantor, in any currency, whether arising hereunder, under the Credit Agreement, any
other Loan Document or otherwise, as the Administrative Agent or such Lender may elect, whether or
not the Administrative Agent or any Lender has made any demand for payment and although such
obligations, liabilities and claims may be contingent or unmatured. The Administrative Agent and
each Lender shall notify such Grantor promptly of any such set-off and the application made by the
Administrative Agent or such Lender of the proceeds thereof, provided that the failure to give such
notice shall not affect the validity of such set-off and application. The rights of the
Administrative Agent and each Lender under this Section 9.6 are in addition to other rights and
remedies (including, without limitation, other rights of set-off) which the Administrative Agent or
such Lender may have.

 

24

          9.7. Counterparts. This Agreement may be executed by one or more of the parties to
this Agreement on any number of separate counterparts (including by telecopy), and all of said
counterparts taken together shall be deemed to constitute one and the same instrument.

          9.8. Severability. Any provision of this Agreement which is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining provisions hereof, and any
such prohibition or unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.

          9.9. Section Headings. The Section headings used in this Agreement are for
convenience of reference only and are not to affect the construction hereof or be taken into
consideration in the interpretation hereof.

          9.10. Integration. This Agreement and the other Loan Documents represent the
agreement of the Grantors, the Administrative Agent and the Lenders with respect to the subject
matter hereof and thereof, and there are no promises, undertakings, representations or warranties
by the Administrative Agent or any Lender relative to subject matter hereof and thereof not
expressly set forth or referred to herein or in the other Loan Documents.

          9.11. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND
INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

          9.12. Submission To Jurisdiction; Waivers. Each Grantor hereby irrevocably and
unconditionally:

          (a) submits for itself and its property in any legal action or proceeding relating to this
Agreement and the other Loan Documents to which it is a party, or for recognition and enforcement
of any judgment in respect thereof, to the non-exclusive general jurisdiction of the Courts of the
State of New York, the courts of the United States of America for the Southern District of New
York, and appellate courts from any thereof;

          (b) consents that any such action or proceeding may be brought in such courts and waives any
objection that it may now or hereafter have to the venue of any such action or proceeding in any
such court or that such action or proceeding was brought in an inconvenient court and agrees not to
plead or claim the same;

          (c) agrees that service of process in any such action or proceeding may be effected by mailing
a copy thereof by registered or certified mail (or any substantially similar form of mail), postage
prepaid, to such Grantor at its address referred to in Section 9.2 or at such other address of
which the Administrative Agent shall have been notified pursuant thereto;

          (d) agrees that nothing herein shall affect the right to effect service of process in any
other manner permitted by law or shall limit the right to sue in any other jurisdiction; and

          (e) waives, to the maximum extent not prohibited by law, any right it may have to claim or
recover in any legal action or proceeding referred to in this Section any special, exemplary,
punitive or consequential damages.

          9.13. Acknowledgments. Each Grantor hereby acknowledges that:

 

25

          (a) it has been advised by counsel in the negotiation, execution and delivery of this
Agreement and the other Loan Documents to which it is a party;

          (b) neither the Administrative Agent nor any Lender has any fiduciary relationship with or
duty to any Grantor arising out of or in connection with this Agreement or any of the other Loan
Documents, and the relationship between the Grantors, on the one hand, and the Administrative Agent
and Lenders, on the other hand, in connection herewith or therewith is solely that of debtor and
creditor; and

          (c) no joint venture is created hereby or by the other Loan Documents or otherwise exists by
virtue of the transactions contemplated hereby among the Lenders or among the Grantors and the
Lenders.

          9.14. Additional Grantors. Each Domestic Subsidiary Borrower that is required to
become a party to this Agreement pursuant to subsection 10.1(b) of the Credit Agreement shall
become a Grantor for all purposes of this Agreement upon execution and delivery by such Domestic
Subsidiary Borrower of an Assumption Agreement in the form of Annex 1 hereto.

          9.15. Releases; Reinstatement.

          (a) At such time as the Loans, the Reimbursement Obligations and the other Obligations shall
have been paid in full, the Commitments have been terminated and no Letters of Credit shall be
outstanding, the Collateral shall be released from the Liens created hereby, and this Agreement and
all obligations (other than those expressly stated to survive such termination) of the
Administrative Agent and each Grantor hereunder shall terminate, all without delivery of any
instrument or performance of any act by any party, and all rights to the Collateral shall revert to
the Grantors. At the request and sole expense of any Grantor following any such termination, the
Administrative Agent shall deliver to such
Grantor any Collateral held by the Administrative Agent hereunder, and execute and deliver to
such Grantor such documents as such Grantor shall reasonably request to evidence such termination.

          (b) If any of the Collateral shall be sold, transferred or otherwise disposed of by any
Grantor in a transaction permitted by the Credit Agreement, then the Administrative Agent, at the
request and sole expense of such Grantor, shall execute and deliver to such Grantor all releases or
other documents reasonably necessary or desirable for the release of the Liens created hereby on
such Collateral. At the request and sole expense of the Borrower, a Subsidiary Guarantor shall be
released from its obligations hereunder in the event that all the Capital Stock of such Subsidiary
Guarantor shall be sold, transferred or otherwise disposed of in a transaction permitted by the
Credit Agreement; provided that the Borrower shall have delivered to the Administrative
Agent, at least ten Business Days prior to the date of the proposed release, a written request for
release identifying the relevant Subsidiary Guarantor and the terms of the sale or other
disposition in reasonable detail, including the price thereof and any expenses in connection
therewith, together with a certification by the Borrower stating that such transaction is in
compliance with the Credit Agreement and the other Loan Documents.

          (c) At such time as the Specified Ratings shall be in effect, the Borrower shall have the
right by written notice to the Administrative Agent to require all Collateral be released from any
security interest created hereby. On any such date (a “Ratings Release Date”), all rights
to the Collateral shall transfer and revert to the Borrower and the Guarantors (the period from and
after any such date (and prior to a reinstatement required pursuant to Section 9.15(e) or (f)), an
“Unsecured Period”). On any such Ratings Release Date, the Grantors shall be authorized
and the Administrative Agent hereby authorizes each Grantor, to prepare and record UCC termination
statements with respect to any financing statements recorded by the Administrative Agent hereunder.
At the request and sole expense of the Borrower

 

26

following a Ratings Release Date, the
Administrative Agent shall deliver to the Borrower any Collateral (including certificates
representing the Pledged Stock) held by the Administrative Agent hereunder, and execute and deliver
to the Borrower such documents as the Borrower shall reasonably request to evidence such
termination.

          (d) At such date as the Leverage Ratio shall have been equal to or less than 2.50 to 1.00 for
a period of four consecutive fiscal quarters, the Borrower shall have the right by written notice
to the Administrative Agent to require that all Collateral other than Pledged Stock be released
from any security interest created hereby. On any such date (a “Leverage Release Date”),
all rights to such Collateral shall transfer and revert to the Borrower and the Guarantors (the
period from an after any such date (and prior to a reinstatement required pursuant to Section
9.15(f)), a “Capital Stock Security Period”). On or after any such Leverage Release Date,
the Grantors shall be authorized and the Administrative Agent hereby authorizes each Grantor, to
prepare and record UCC amendments with respect to any financing statements recorded by the
Administrative Agent hereunder to reflect the release of all Collateral other than Pledged Stock.
At the request and sole expense of the Borrower following a Leverage Release Date, the
Administrative Agent shall deliver to the Borrower any Collateral (other than certificates
representing Pledged Stock) held by the Administrative Agent hereunder, and execute and deliver to
the Borrower such documents as the Borrower shall reasonably request to evidence such termination.

          (e) Notwithstanding clause (c) of this Section 9.15, in the event that the Specified Ratings
shall no longer be in effect as a result of a ratings downgrade by either S&P or Moody’s at any
time during an Unsecured Period, the Collateral shall be reinstated in full within sixty days of
such event, along with any necessary UCC filings, modifications to the Schedules hereto and such
other actions requested by the Administrative Agent as are reasonably necessary to grant a first
priority perfected security interest (subject to Liens otherwise permitted by this Agreement and
the Credit Agreement) in such Collateral; provided that if at such time the Borrower would
be permitted to seek a release of all
Collateral other than Pledged Stock in accordance with clause (d) of this Section 9.15, such
reinstatement requirement shall apply only to Pledged Stock.

          (f) Notwithstanding clause (d) of this Section 9.15, in the event that the Leverage Ratio as
at the end of any fiscal quarter of the Borrower shall be in excess of 2.50 to 1.00 at any time
during a Capital Stock Security Period and the Specified Ratings shall not then be in effect, the
Required Lenders may, upon written notice by the Administrative Agent to the Borrower, require that
all Collateral be reinstated in full within sixty days of such notice, along with any necessary UCC
filings, modifications to the Schedules hereto and such other actions as are reasonably necessary
to grant a first priority (subject to Liens permitted by this Agreement and the Credit Agreement)
perfected security interest in such Collateral.

          9.16. Conflict of Laws. Notwithstanding anything to the contrary herein, in the event
that any provision of any pledge, charge or foreign equivalent executed by any Foreign Subsidiary
and governed by the laws of the applicable foreign jurisdiction is inconsistent with any
corresponding provision in this Agreement, the provision in such pledge, charge or foreign
equivalent shall govern.

          9.17. WAIVER OF JURY TRIAL. EACH GRANTOR HEREBY IRREVOCABLY AND UNCONDITIONALLY
WAIVES TRIAL BY JURY IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER LOAN
DOCUMENT AND FOR ANY COUNTERCLAIM THEREIN.

[Remainder of page intentionally left blank]

 

     IN WITNESS WHEREOF, each of the undersigned has caused this Amended and Restated
Guarantee and Collateral Agreement to be duly executed and delivered as of the date first above
written.

	 	 	 	 	 
	 	 	JPMORGAN CHASE BANK, N.A.

	 

	 	By:
	 	 
	 

	 	 	 	 
	 

	 	 	 	Name:
	 

	 	 	 	Title:

	 	 	THE SCOTTS MIRACLE-GRO COMPANY

	 

	 	By:
	 	 
	 

	 	 	 	 
	 

	 	 	 	Name:
	 

	 	 	 	Title:

	 	 	[NAME OF GRANTOR]

	 

	 	By:
	 	 
	 

	 	 	 	 
	 

	 	 	 	Name:
	 

	 	 	 	Title:

 

 

 

ACKNOWLEDGMENT AND CONSENT

          The undersigned hereby acknowledges receipt of a copy of the Amended and Restated Guarantee
and Collateral Agreement dated as of February 7, 2007 (the “Agreement”), made by the
Grantors parties thereto in favor of JPMorgan Chase Bank, N.A., as Administrative Agent. The
undersigned agrees for the benefit of the Administrative Agent and the Secured Parties as follows:

     SECTION 1. The undersigned will be bound by the terms of the Agreement and will comply with
such terms insofar as such terms are applicable to the undersigned.

     SECTION 2. The undersigned will notify the Administrative Agent promptly in writing of the
occurrence of any of the events described in Section 6.6(a) of the Agreement.

     SECTION 3. The terms of Sections 7.3(c) and 7.7 of the Agreement shall apply to it,
mutatis mutandis, with respect to all actions that may be required of it
pursuant to Section 7.3(c) or 7.7 of the Agreement.

	 	 	 	 	 
	 	[NAME OF ISSUER]

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 
	 
	 	Address for Notices:	 
	 
	 	 	 	 
	 	 	 
	 
	 	 	 	 
	 	 	 
	 
	 	 	 	 
	 	 	 
	 

	Fax:	 	 	 
	 

	 	 

	 

 

 

Annex 1 to

Amended and Restated Guarantee and Collateral Agreement

          ASSUMPTION AGREEMENT, dated as of                                         , 20___, made by
                                                            , a                     
corporation (the “Additional Grantor”), in
favor of JPMorgan Chase Bank, N.A., as administrative agent (in such capacity, the
“Administrative Agent”) for the banks and other financial institutions (the
“Lenders”) parties to the Credit Agreement referred to below. All capitalized terms not
defined herein shall have the meaning ascribed to them in such Credit Agreement.

W I
T N E S S E T H :

          WHEREAS, The Scotts Miracle-Gro Company, an Ohio corporation (the “Borrower”), the
Subsidiary Borrowers, the Lenders, the Administrative Agent, the Documentation Agent and the
Syndication Agent have entered into a Amended and Restated Credit Agreement, dated as of
[                    ] (as amended, supplemented or otherwise modified from time to time, the “Credit
Agreement”);

          WHEREAS, in connection with the Credit Agreement, the Borrower and certain of its Affiliates
(other than the Additional Grantor) have entered into the Amended and Restated Guarantee and
Collateral Agreement, dated as of [                    ] (as amended, supplemented or otherwise modified from
time to time, the “Guarantee and Collateral Agreement”) in favor of the Administrative
Agent for the ratable benefit of the Secured Parties;

          WHEREAS, the Credit Agreement requires the Additional Grantor to become a party to the
Guarantee and Collateral Agreement; and

          WHEREAS, the Additional Grantor has agreed to execute and deliver this Assumption Agreement in
order to become a party to the Guarantee and Collateral Agreement;

          NOW, THEREFORE, IT IS AGREED:

          1. Guarantee and Collateral Agreement. By executing and delivering this Assumption
Agreement, the Additional Grantor, as provided in Section 9.14 of the Guarantee and Collateral
Agreement, hereby becomes a party to the Guarantee and Collateral Agreement as a Grantor thereunder
with the same force and effect as if originally named therein as a Grantor and, without limiting
the generality of the foregoing, hereby expressly assumes all obligations and liabilities of a
Grantor thereunder. The information set forth in Annex 1-A hereto is hereby added to the
information set forth in the Schedules to the Guarantee and Collateral Agreement. The Additional
Grantor hereby represents and warrants that each of the representations and warranties contained in
Section 5 of the Guarantee and Collateral Agreement is true and correct on and as the date hereof
(after giving effect to this Assumption Agreement) as if made on and as of such date.

          2. Governing Law. THIS ASSUMPTION AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND
INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

[Remainder of page intentionally left blank]

 

2

          IN WITNESS WHEREOF, the undersigned has caused this Assumption Agreement to be duly executed
and delivered as of the date first above written.

	 	 	 	 	 
	 	[ADDITIONAL GRANTOR]

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 

 

EXHIBIT C

FORM OF SWING LINE LOAN PARTICIPATION CERTIFICATE

[Letterhead of JPMorgan Chase Bank, N.A.]

[Name of Lender]

[Address of Lender]

Dear Sirs:

Pursuant to subsection 2.6(c) of the Amended and Restated Credit Agreement, dated as of February
[___], 2007 (as amended, supplemented, waived or otherwise modified from time to time, the “Credit
Agreement”), by and among The Scotts Miracle-Gro Company, an Ohio corporation (the
“Borrower”), the Subsidiary Borrowers (as defined in the Credit Agreement) from time to
time parties thereto, the several banks and other financial institutions from time to time parties
thereto (the “Lenders”), the Syndication Agent and the Documentation Agents named therein,
and JPMorgan Chase Bank, N.A. as agent for the Lenders thereunder (in such capacity, the
“Administrative Agent”), the undersigned hereby acknowledges receipt from you on the date
hereof of [AMOUNT IN WORDS] DOLLARS [OR DOLLAR EQUIVALENT] AND [AMOUNT IN WORDS] CENTS
($                    ) as payment for a participating interest in the following Swing Line Loan:

	 	 	 	 	 	 	 	 	 
	Date of Swing Line Loan:
	 	 	 	 	 	 	 	 
	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	Principal Amount of Swing Line Loan:	 	 	 	 	 	 
	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	Facility to which Swing Line Loan Will Be Applied:	 	 	 	 
	 

	 	 	 	 	 	 

	 	 

Very truly yours,

[NAME OF SWING LINE LENDER]

	 	 	 	 
	 	 
	By:  	 	 
	 	Name:  	 	 
	 	Title:  	 	 
	 

 

EXHIBIT D

FORM OF U.S. TAX COMPLIANCE CERTIFICATE

          Reference is made to the Loan(s) held by the undersigned pursuant to the Amended and Restated
Credit Agreement, dated as of February [___], 2007 (as amended, supplemented, waived or otherwise
modified from time to time, the “Credit Agreement”), by and among The Scotts Miracle-Gro
Company, an Ohio corporation (the “Borrower”), the Subsidiary Borrowers (as defined in the
Credit Agreement) from time to time parties thereto, the several banks and other financial
institutions from time to time parties thereto (the “Lenders”), the Syndication Agent and
the Documentation Agents named therein, and JPMorgan Chase Bank, N.A. as agent for the Lenders
thereunder (in such capacity, the “Administrative Agent”). The undersigned hereby
certifies under penalty of perjury that:

     (1) The undersigned is the beneficial owner of the Loan(s) (as well as any Note(s)
evidencing such Loan(s)) registered in its name;

     (2) The income from the Loan(s) held by the undersigned is not effectively connected
with the conduct of a trade or business within the United States;

     (3) The undersigned is not a bank (as such term is used in Section 881(c)(3)(A) of the
Internal Revenue Code of 1986, as amended (the “Code”)), is not subject to
regulatory or other legal requirements as a bank in any jurisdiction, and has not been
treated as a bank for purposes of any tax, securities law or other filing or submission made
to any governmental authority, any application made to a rating agency or any qualification
for any exemption from any tax, securities law or other legal requirements;

     (4) The undersigned is not a 10-percent shareholder of the Borrower within the meaning
of Section 881(c)(3)(B) of the Code; and

     (5) The undersigned is not a controlled foreign corporation receiving interest from a
related person within the meaning of Section 881(c)(3)(C) of the Code.

 

2

     We have furnished you with a certificate of our non-U.S. person status on Internal
Revenue Service Form W-8BEN or W-8ECI. By executing this certificate, the undersigned
agrees that (1) if the information provided on this certificate changes, the undersigned
shall so inform the Borrower (for the benefit of each of the Borrower, the Subsidiary
Borrowers and the Administrative Agent) in writing within thirty days of such change and (2)
the undersigned shall furnish the Borrower (for the benefit of each of the Borrower, the
Subsidiary Borrowers and the Administrative Agent) a properly completed and currently
effective certificate in either the calendar year in which payment is to be made by any of
the Subsidiary Borrowers to the undersigned, or in either of the two calendar years
preceding such payment.

          Unless otherwise defined herein, terms defined in the Credit Agreement and used herein shall
have the meanings given to them in the Credit Agreement.

	 	 	 	 	 
	 	[NAME OF LENDER]

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 

	 	 	 	 	 
	 	[Address]

 	 
	 	 	 
	 	 	 
	 	 	 
	 

Dated:                     , 200_

 

EXHIBIT E

FORM OF INCREMENTAL COMMITMENT SUPPLEMENT

     SUPPLEMENT, dated                      to the Amended and Restated Credit Agreement, dated as of
February [___], 2007 (as amended, supplemented, waived or otherwise modified from time to time, the
“Credit Agreement”), by and among The Scotts Miracle-Gro Company, an Ohio corporation (the
“Borrower”), the Subsidiary Borrowers (as defined in the Credit Agreement) from time to
time parties thereto, the several banks and other financial institutions from time to time parties
thereto (the “Lenders”), the Syndication Agent and the Documentation Agents named therein,
and JPMorgan Chase Bank, N.A. as agent for the Lenders thereunder (in such capacity, the
“Administrative Agent”).

W I T N E S S E T H :

     WHEREAS, the Credit Agreement provides in subsection 2.27(a) thereof that any Lender to which
commitment additions or increases are offered may (i) add one or more additional tranches of term
loans or (ii) have one or more increases in the amount of its Revolving Credit Commitments in
respect of each or any of the Commitments by executing and delivering to the Borrower, the Regular
Subsidiary Borrowers and the Administrative Agent a supplement to the Credit Agreement in
substantially the form of this Supplement; and

WHEREAS, the undersigned now desires [DESCRIBE] under the Credit Agreement;

     NOW, THEREFORE, the undersigned hereby agrees as follows:

     1. The undersigned agrees, subject to the terms and conditions of the Credit Agreement,
that on the date this Supplement is accepted by the Borrower, the Regular Subsidiary
Borrowers and the Administrative Agent it shall have its:

     [tranches of term loans increased by ___thereby making the amount of its
term loan tranches ___in respect of [FACILITY]; ]1

     [Revolving Credit Commitment increased by $                     [or Dollar equivalent]
thereby making the amount of its Revolving Credit Commitment $                     [or Dollar
equivalent] in respect of [FACILITY].]2

     2. Terms defined in the Credit Agreement shall have their defined meanings when used
herein.

 

			
	1	 	Include if adding tranches of term loans.
	 
	2	 	Included if increasing Revolving Credit
Commitment.

 

2

     IN WITNESS WHEREOF, the undersigned has caused this Supplement to be executed and delivered by
a duly authorized officer on the date first above written.

	 	 	 	 	 
	 	[INSERT NAME OF

LENDER]

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 

 

3

Accepted this ___ day of

                    , ___.

	 	 	 	 
	THE SCOTTS MIRACLE-GRO COMPANY

 	 
	By:  	 	 
	 	Name:  	 	 
	 	Title:  	 	 
	 

	 	 	 	 
	[REGULAR SUBSIDIARY BORROWER]

 	 
	By:  	 	 
	 	Name:  	 	 
	 	Title 	 
	 

 

4

Accepted this ___ day of

                    , 200___.

	 	 	 	 
	JPMORGAN CHASE BANK, N.A.,

as Administrative Agent

 	 
	By:  	 	 
	 	Name:  	 	 
	 	Title:  	 	 
	 

 

EXHIBIT F

FORM OF FOREIGN PLEDGE AGREEMENT ACKNOWLEDGMENT AND CONFIRMATION

     FOREIGN PLEDGE AGREEMENT ACKNOWLEDGMENT AND CONFIRMATION, dated as of February [___], 2007
(this “Acknowledgment”), to:

               (1) Foreign Pledge Agreements (the “Foreign Pledge
Agreements”)

W I T N E S S E T H :

          WHEREAS, the Borrower, certain subsidiary borrowers, certain Lenders and other banks and
financial institutions and JPMorgan Chase Bank, as Administrative Agent are parties to the
Revolving Credit Agreement, dated as of July 21, 2005 (as amended, supplemented, amended and
restated or otherwise modified prior to the date hereof, the “Credit Agreement”) and
concurrently with the execution of this Acknowledgment, the Borrower, the Subsidiary Borrowers, the
Lenders and the Administrative Agent will enter into an amendment and restatement of the Credit
Agreement (the “Amendment and Restatement”).

          WHEREAS, each of the parties to the Foreign Pledge Agreements listed on Schedule 1 hereto
wishes to acknowledge and confirm that its obligations and its Liens and security interests created
under such Foreign Pledge Agreements continue in full force and effect, unimpaired and
undischarged, as provided herein;

          [WHEREAS, it is a condition precedent to the effectiveness of the Amendment and Restatement
that the parties hereto shall have executed this Acknowledgment to the Administrative Agent for the
benefit of the Lenders.][DISCUSS TIMING]

          NOW, THEREFORE, in consideration of the premises contained herein and to induce the
Administrative Agent and the Lenders to amend and restate the Credit Agreement pursuant to the
Amendment and Restatement and to induce the Lenders to make and continue extensions of credit under
the Amendment and Restatement, each of the signatories hereto hereby agrees with the Administrative
Agent, for the benefit of the Lenders, as follows:

     1. Unless otherwise defined herein, capitalized terms used herein shall have the respective
meanings assigned to them in the Amendment and Restatement and the other Loan Documents.

     2. References to the Credit Agreement in the Foreign Pledge Agreements shall be references
to the Amendment and Restatement.

     3. Each signatory hereto consents to the execution, delivery and performance of the Amendment
and Restatement in accordance with its terms.

 

 

     4. Each signatory hereto hereby agrees, with respect to each Foreign Pledge Agreement to
which it is a party, that to the extent permitted by applicable law:

(a) all of its obligations, liabilities and indebtedness under such Foreign Pledge
Agreement shall remain in full force and effect on a continuous basis after giving
effect to the Amendment and Restatement and this Acknowledgment and its guarantee of
the obligations, liabilities and indebtedness of the other Loan Parties under the
Credit Agreement (or any predecessor agreement) shall extend to and cover the Term
Loans and Revolving Extensions of Credit made under the Amendment and Restatement
(including the annexes thereto) and interest thereon and fees and expenses and other
obligations in respect thereof and in respect of commitments related thereto; and

(b) all of the Liens and security interests created and arising under such Foreign
Pledge Agreement remain in full force and effect on a continuous basis, and the
perfected status and priority of each such Lien and security interest continues in
full force and effect on a continuous basis, unimpaired, uninterrupted and
undischarged, after giving effect to the Amendment and Restatement, as collateral
security for its obligations, liabilities and indebtedness under the Amendment and
Restatement (including the annexes thereto) and under its guarantees in the Foreign
Pledge Agreement.

     5. Each Signatory hereto agrees that the provisions of Section 9.15 of the Amended and
Restated Guarantee and Collateral Agreement, as such provisions relate to the release and/or
subsequent reinstatement of security interests in Pledged Stock, shall apply in each case to the
shares of Capital Stock pledged under each Foreign Pledge Agreement.

     6. Each signatory hereto agrees that it shall take any action reasonably requested by the
Administrative Agent in order to confirm or effect the intent of this Acknowledgment.

     7. THIS ACKNOWLEDGMENT SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE
WITH, THE LAW OF THE STATE OF NEW YORK.

     8. This Acknowledgment may be executed by one or more of the parties hereto on any number of
separate counterparts (including by telecopy), and all of said counterparts taken together shall be
deemed to constitute one and the same instrument.

 

 

     IN WITNESS WHEREOF, the undersigned have caused this Acknowledgment to be executed and
delivered by a duly authorized officer on the date first above written.

 

 

Schedule 1

Foreign Pledge Agreements

 

 

Exhibit G

February 7, 2007

JPMorgan Chase Bank, N.A., as Administrative Agent

270 Park Avenue

New York, New York 10017

and

Each of the Lenders that are parties to

the Credit Agreement (hereinafter defined)

as of the date hereof

     Ladies and Gentlemen:

     We have acted as special counsel to The Scotts Miracle-Gro Company, an Ohio corporation
(“SMG”), and certain domestic subsidiaries of SMG listed in Annex A attached hereto
(each a “Subsidiary” or, collectively, the “Subsidiaries”), in connection with the
transactions contemplated by the Amended and Restated Credit Agreement, dated as of February 7,
2007 (the “Credit Agreement”), among SMG, certain of its Domestic Subsidiaries and Foreign
Subsidiaries, including the following eight Subsidiaries: Hyponex Corporation, a Delaware
corporation, Scotts Temecula Operations, LLC, a Delaware limited liability company, Scotts
Manufacturing Company, a Delaware corporation, EG Systems, Inc., an Indiana corporation, Smith &
Hawken, Ltd., a Delaware corporation, The Scotts Company LLC, an Ohio limited liability company,
SMG Growing Media, Inc., an Ohio corporation, and Gutwein & Co., Inc., an Indiana corporation (each
individually, a “Subsidiary Borrower” and together with SMG, collectively, the
“Borrowers”), the lenders parties thereto (the “Lenders”), JPMorgan Chase Bank,
N.A., as Administrative Agent (in such capacity, the “Administrative Agent”), and the
Syndication Agents and Documentation Agents named therein. The remaining Subsidiaries, together
with the Subsidiary Borrowers and the Borrower, are executing and delivering the Amended and
Restated Guarantee and Collateral Agreement, dated as of February 7, 2007, in favor of the
Administrative Agent for the benefit of the Lenders (the “Guarantee and Collateral
Agreement”).

     The opinions expressed below are furnished to you pursuant to Section 5.1(e)(i) of the Credit
Agreement. Unless otherwise defined herein, terms defined in the Credit Agreement and used herein
shall have the meanings given to them in the Credit Agreement.

     Uncapitalized terms used herein that are defined in Articles 8 and 9 (and other Articles made
applicable thereby) of the Uniform Commercial Code (the “Code”) as enacted in the State

 

 

February 7,
2007

Page 2

of Ohio (the “Ohio UCC”), Chapters 1308 and 1309 of the Revised Code of Ohio (“R.C.”)
have the meanings specified in the Ohio UCC, unless otherwise defined herein.

     In arriving at the opinions expressed below, we have examined an original or certified,
conformed or reproduction copy form identified to our satisfaction, and, with respect to the terms
set forth in clause (d) below, have relied upon the accuracy of, without independent verification
or investigation:

     (a) the Credit Agreement and the Guarantee and Collateral Agreement (each Borrower or
Subsidiary party to the Guarantee and Collateral Agreement, a “Grantor”); all of the
foregoing referred to hereinafter as the “Documents”;

     (b) documents and records of SMG and each of the Subsidiaries consisting of their
respective (i) Articles of Incorporation, Certificate of Incorporation, Certificate of
Formation or Articles of Organization, (ii) Code of Regulations, By-laws, Limited Liability
Company Agreement or Operating Agreement, and (iii) certified copies of the resolutions
adopted by their Boards of Directors, sole manager or sole member, and such other corporate
or limited liability company documents, proceedings and records as we have deemed necessary
or appropriate for purposes of this opinion (collectively, the “Company
Legislation”);

     (c) unfiled copies of the financing statements listed on Annex B hereto
(collectively, the “Financing Statements”), naming the Grantors indicated on such
Annex B as debtors and the Administrative Agent as secured party; we understand such
Financing Statements will be filed in the offices listed on Annex B (collectively,
the “Filing Offices”);

     (d) certificate of an officer or officers of SMG and the Subsidiaries, and statements
of other representatives of SMG and the Subsidiaries, as to certain factual matters, and a
certificate of officers of SMG and the Subsidiaries as to the incumbency of the officer(s)
of SMG and the Subsidiaries authorized to sign the Documents;

     (e) certificates from the Secretary of State of the state shown next to the name of
each of SMG and the Subsidiaries listed on Annex C attached hereto, dated the date
indicated, with respect to the good standing or full force and effect, as applicable, of
each of SMG and the Subsidiaries; and

     (f) such authorities of law as we have deemed relevant as a basis for the opinions
expressed herein.

     With respect to each document examined we have assumed, as to all parties thereto except, with
respect to the matters referenced in clauses (a), (b), (c), and (d) of this paragraph, as to SMG
and the Subsidiaries, (a) the genuineness of all signatures, the authenticity of all documents
submitted to us as originals, the conformity to original documents of documents
submitted to us as certified or photostatic copies, forms or drafts, and the authenticity of
such originals of such latter documents; (b) the due completion, execution, and acknowledgment as
indicated thereon and delivery of all Documents; (c) that each of such parties has the requisite

 

 

February 7, 2007

Page 3

power and authority to execute and deliver the Documents to which it is a party and all other
documents and instruments contemplated thereby, and to perform its obligations thereunder, and that
all such actions have been duly and validly authorized by all necessary proceedings on the part of
such parties; (d) that the Documents constitute the legal, valid and binding obligations of such
parties thereto, enforceable against each of such parties in accordance with their respective
terms; (e) that each of the Documents is supported by adequate consideration; and (f) that the laws
of any jurisdiction other than the United States, the State of Ohio, the General Corporation Law of
the State of Delaware or the Limited Liability Company Act of the State of Delaware that may govern
any of the Documents or the Company Legislation are not inconsistent with the laws of the State of
Ohio, the General Corporation Law of the State of Delaware or the Limited Liability Company Act of
the State of Delaware in any manner material to this opinion.

     We have also assumed that (a) each Grantor has, or has the power to transfer, rights in that
portion of the Collateral for which it is granting a security interest consistent with and
sufficient for the purposes of R.C. Section 1309.203, and the description of such personal property
in the Guarantee and Collateral Agreement reasonably identifies the personal property subject to
the security interest granted therein; (b) that the Financing Statements contain the correct name
of the Administrative Agent or a representative of the Administrative Agent; and (c) none of the
Collateral described in the Guarantee and Collateral Agreement is (i) timber to be cut, minerals or
the like or as-extracted collateral or (ii) consumer goods.

     As to all matters of fact which are material to our opinion, we have relied, without any
independent due diligence or other investigation, upon the truth and accuracy of the
representations, warranties and recitals of fact (as opposed to conclusions of law) made or set
forth in the Documents, but we have no knowledge that any such statements are inaccurate or
incomplete.

     To the extent the Documents are governed by the internal laws of New York, we have assumed
that each of the Documents constitutes the legal, valid and binding obligation of each party
thereto other than SMG and the Subsidiaries, enforceable against each such other party in
accordance with its respective terms under the internal laws of the State of New York and under the
internal laws of the jurisdiction of incorporation or formation of each such other party.

     As used herein, the phrase “all necessary company action” means, with respect to SMG and the
Subsidiaries, all necessary corporate or limited liability company action of SMG and the
Subsidiaries under their respective Company Legislation and the corporation law or limited
liability company law of their respective states of incorporation, formation, or organization. As
used herein, the phrase “power and authority” means, with respect to SMG and the Subsidiaries,
power and authority under their respective Company Legislation and the corporation law or limited
liability company law of their respective states of incorporation, formation or organization. For
purposes of the definitions in this paragraph, with respect to any Subsidiary not incorporated or
formed in Ohio or Delaware, we have assumed that the corporation or limited
liability company law of each such Subsidiary’s state of incorporation, formation or
organization is not different from the General Corporation Law of the State of Ohio, the General
Corporation Law of the State of Delaware, or the Delaware Limited Liability Company Act in any
manner material to this opinion.

 

 

February 7, 2007

Page 4

     Based upon and subject to the foregoing and the further qualifications and limitations set
forth below, as of the date hereof (or as of the date of any certificate stated to have been relied
on by us), we are of the opinion that:

     1. Each of SMG and the Subsidiaries (a) is duly incorporated or formed, as applicable, validly
existing and in good standing under the laws of the jurisdiction of its incorporation or formation
and (b) has the power and authority to own and operate its property, to lease the property it
operates as lessee and to conduct the business in which it is currently engaged.

     2. Each of the Borrowers has the power and authority to make, deliver and perform its
obligations under the Documents to which it is a party and to borrow under the Credit Agreement and
each of the Grantors has the power and authority to grant the security interests to be granted by
it pursuant to the Guarantee and Collateral Agreement. Each of the Borrowers has taken all
necessary company action to authorize the execution, delivery and performance of the Credit
Agreement and each of the Grantors has taken all necessary company action to authorize the
execution, delivery and performance of the Guarantee and Collateral Agreement. No consent or
authorization of, approval by, notice to, filing with or other act by or in respect of, any
Governmental Authority or, to our knowledge, any other Person is required in connection with the
borrowings under the Credit Agreement, the execution, delivery, performance, validity or
enforceability of the Documents, or the granting of any security interests under the Guarantee and
Collateral Agreement (except filings related to the perfection of such security interests), except
for such consents and approvals as have already been obtained.

     3. The Credit Agreement has been duly executed and delivered on behalf of the Borrowers and
constitutes a legal, valid and binding obligation of the Borrowers, enforceable against the
Borrowers in accordance with its terms. The Guarantee and Collateral Agreement has been duly
executed and delivered on behalf of the Grantors and constitutes a legal, valid and binding
obligation of the Grantors, enforceable against the Grantors in accordance with its terms.

     4. The execution and delivery of the Documents to which it is a party by each of the Borrowers
and Grantors, the performance by each of the Borrowers and Grantors of its obligations thereunder,
the consummation of the transactions contemplated thereby by the Borrowers and Grantors, the
compliance by each of the Borrowers and Grantors with any of the provisions thereof as contemplated
thereby, the compliance by each of the Borrowers and Grantors with any of the provisions thereof as
contemplated as of the date hereof, the borrowings under the Credit Agreement and the use of
proceeds thereof in compliance with the terms of the Credit Agreement, all as provided therein, (a)
will not violate, or constitute a material default under any Requirement of Law applicable to
corporations for profit or limited liability companies generally, or to our knowledge, any material
Contractual Obligation of any of the
Borrowers or Grantors and (b) will not result in, or require, the creation or imposition of
any Lien on any of the properties or revenues of any of the Borrowers or Grantors, except as
described in this opinion and as described in the Documents.

     5. None of SMG or the Subsidiaries is (a) an “investment company,” or a company “controlled”
by an “investment company,” within the meaning of the Investment Company Act

 

 

February 7, 2007

Page 5

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

     6. To our knowledge, except as set forth on Schedule 4.5 and Schedule 4.17 to the Credit
Agreement, no litigation, investigation or proceeding of or before, any arbitrator or
Governmental Authority is pending or threatened by or against any of the Borrowers or Grantors or
against any of their respective properties or revenues (a) with respect to any of the Documents or
any of the transactions contemplated thereby, or (b) which would have a Material Adverse Effect.

     7. To our knowledge, none of the Borrowers or Grantors is in default under or with respect to
any Contractual Obligation in any respect which could reasonably be expected to have a Material
Adverse Effect.

     8. If the Guarantee and Collateral Agreement were stated to be governed by and construed in
accordance with the laws of the State of Ohio, (a) it will be effective to attach a security
interest in favor of the Administrative Agent under the Ohio UCC to the Collateral and (b) the
perfection of the Administrative Agent’s security interests in the Collateral (i) will, as a
general matter, and except as otherwise provided in Sections 1309.301 through 1309.307 of the Ohio
UCC, be governed by the local law of the jurisdiction in which the applicable Grantor is located
(which in the case of a registered organization is the state under the laws of which such
registered organization is organized) and (ii) which constitute certificated securities will be
governed by the local law of the jurisdiction in which the certificated securities are located
(except as to perfection by filing, which is governed by the laws referred to in clause (b)(i) of
this paragraph) as specified in Section 1309.305(A)(1) of the Ohio UCC.

     9. Under the principles described in paragraph 8(b)(i) above, the perfection of the
Administrative Agent’s security interest in the Collateral (except as to perfection by possession
of certificated securities as described in paragraph 10 below) is governed by the laws of the
states of organization of each Grantor, as set forth on Annex C attached hereto. We are
licensed to practice law only in the State of Ohio, and do not practice law in any of such other
jurisdictions, and express no opinions as to such laws; however, we have reviewed the text of the
relevant provisions of Articles 8 and 9 of the Uniform Commercial Code, as enacted in such states
(each a “Jurisdiction of Organization Code”) as displayed on Westlaw on February ___, 2007,
but without regard to the filing rules or the decisional or other law of such states. We confirm
that, upon communication of the Financing Statements and tender of the applicable filing fee or
acceptance of the Financing Statements in or by the Filing Offices in accordance with the
provisions of each applicable Jurisdiction of Organization Code, the security interests created by
the Guarantee and Collateral Agreement in such Collateral described in each such
Financing Statement will be perfected to the extent a security interest can be perfected in
the Collateral by the filing of a financing statement in that office.

     10. We understand that the stock or share certificates listed on Annex D attached
hereto and evidencing the shares of Capital Stock of each of the Subsidiaries other than The Scotts
Company LLC and Scotts Temecula Operations, LLC (collectively, the “Stock Certificates”)
are to be held by the Administrative Agent in the States of New York and/or Texas. We have
reviewed the text of the relevant provisions of Articles 8 and 9 of the Uniform

 

 

February 7, 2007

Page 6

Commercial Code, as
enacted in the States of New York and Texas (the “New York/Texas Codes”) as displayed on
Westlaw on February ___, 2007, but without regard to the decisional or other law of the States of
New York and Texas. We confirm that, assuming that the Administrative Agent has taken and retained
possession of the Stock Certificates in either the State of New York or the State of Texas, duly
indorsed to the Administrative Agent or in blank, any security interest of the Administrative Agent
in the Stock Certificates which has attached is a perfected security interest in the Capital Stock
evidenced thereby under the New York/Texas Codes, as applicable.

     The opinions expressed above are subject to the following additional qualifications:

     (a) Our opinions are subject to the limitations, if any, of Title 11, U.S.C., as amended, and
of any applicable insolvency, reorganization, moratorium or other similar laws affecting creditors’
rights generally and by principles of equity. In addition, certain remedial and other provisions
of the Documents may be limited by (i) implied covenants of good faith, fair dealing and
commercially reasonable conduct; (ii) judicial discretion, in the instance of multiple or equitable
remedies; and (iii) by the public policies and laws of the State of Ohio, the General Corporation
Law of the State of Delaware, and the Limited Liability Company Act of the State of Delaware to the
extent, if any, applicable. Subject to the qualification that we have no knowledge of the extent
to which the Administrative Agent and the Lenders consider any of the provisions of the Documents
that may be limited by the foregoing to be critical or essential, none of the foregoing limitations
will make, in our view, the remedies provided for in the Documents, taken as a whole, inadequate
for the practical realization of the benefits of the rights provided or purported to be provided by
the Documents.

     (b) We have made no examination of, and express no opinion as to, title to any of the real or
personal property interests described in or affected by the Documents, and, accordingly, we express
no opinion as to the existence of any liens, encumbrances, security interests or charges thereon,
or the validity, and/or perfection of the liens or security interests that may be created,
evidenced or effected by any of the Documents, except as set forth in paragraphs 8, 9 and 10. We
express no opinion as to the priority of any liens or security interests that may be created,
evidenced or affected by any of the Documents. We also express no opinion as to the enforceability
against Scotts-Sierra Investments, Inc. of any provisions of the Guarantee and Collateral Agreement
relating to, or any liens thereunder relating to, the Capital Stock of non-U.S. subsidiaries of
Scotts-Sierra Investments, Inc.

     (c) We have not conducted factual or legal examinations, and accordingly we express no opinion
as to (i) federal and state securities laws; (ii) the effect or application, if any, of any laws or
regulations (a) concerning or promulgated by environmental agencies or authorities, or (b)
industries the operations, financial affairs or profits of which are regulated by the United States
of America or the State of Ohio; for example, banks and thrift institutions, (iii) fraudulent
dispositions or obligations; (iv) racketeer influenced and corrupt organizations (RICO) statutes;
(v) taxes or tax effects; (vi) qualification, registration or filing requirements of the State of
Ohio or the State of Delaware; or (vii) any order of any court or other authority, of which we do
not have knowledge, directed specifically to any party to any of the Documents.

 

 

February 7, 2007

Page 7

     (d) We express no opinion as to the effect of, and the enforceability of the Documents is
subject to the effect of, general principles of equity, including, without limitation, the
discretionary nature of specific performance and other equitable remedies, judicial limitations
that may be imposed on the availability of equitable remedies, including court decisions and
federal and state laws and interpretations thereof. We note that certain other remedial, waiver
and other provisions of the Documents may also be limited or rendered invalid by applicable federal
or state laws, rules, regulations, court decisions and constitutional requirements in and of the
State of Ohio and the United States of America; however, in such cases, there exist adequate
remedial provisions for the practical realization of the benefits intended to be conferred thereby.
The provisions of the Documents regarding the remedies available to the Administrative Agent and
the other Lenders upon default are subject to procedural requirements under applicable laws and
regulations.

     (e) We express no opinion as to the enforceability of rights, provisions or interests to the
extent, if any, dependent upon the enforceability of (i) waivers of rights of debtors or others
which may not be waived or which may be waived only under certain circumstances under applicable
law; (ii) provisions of the Documents to the extent held to (a) require the payment of interest on
interest, (b) compensate any party in excess of actual loss or reasonable expenses or constitute a
penalty, (c) require reimbursement for or indemnity against actions by the Administrative Agent or
others taken in violation of duties under the Documents or applicable law or public policy (this
exception does not include repayments of the Loans and reimbursements for amounts drawn on Letters
of Credit in accordance with the terms of the Documents), (d) require indemnity or reimbursement by
a Person for additional costs or expenses where the party reimbursed has incurred such expense by
reason in part of the effect of activities with others not party to the Documents and has assigned
or allocated the burden of reimbursement unreasonably or arbitrarily, (e) purport to waive or
negate in favor of the Administrative Agent or others the effect of notice of Default or Event of
Default, if any, which the Administrative Agent or others may have at closing, or (f) include an
acceleration clause and a prepayment penalty exercised with respect to the same obligation; or
(iii) any provision for the award of attorneys’ fees to an opposing party.

     (f) The foregoing opinions concerning the security interests of the Administrative Agent are
subject to the qualifications that we express no opinion as to any situation or transaction
excluded from the Ohio Code by virtue of R. C. Section 1309.109.

     (g) To the extent that the Administrative Agent elects to proceed under the Ohio Code, the
security interests created by the Guarantee and Collateral Agreement are subject to such
limitations, exceptions and rights of purchasers and creditors as are provided for under the
provisions of Sections 1309.601 to 1309.628 of the Ohio Code.

     (h) Whenever any matter is indicated to be based on our knowledge, we are referring to the
actual knowledge of the Vorys, Sater, Seymour and Pease LLP attorneys who have represented SMG and
the Subsidiaries in connection with the transactions contemplated by the Documents. We have relied
solely upon the examinations and inquiries recited herein and we have not undertaken any other
independent investigation to determine the existence or absence of any facts, and no inference as
to our knowledge concerning such facts should be drawn. Without limiting the generality of the
foregoing, we have made no examination of the character,

 

 

February 7, 2007

Page 8

organization, activities, or authority of
the Administrative Agent or any of the Lenders which might have any effect upon our opinions as
expressed herein, and we have neither examined, nor do we opine upon, any provision or matter to
the extent that the examination or opinion would require a financial, mathematical or accounting
calculation or determination.

     This opinion is limited to the federal laws of the United States of America, the laws of the
State of Ohio, the General Corporation Law of the State of Delaware, and the Limited Liability
Company Act of the State of Delaware having effect on the date hereof. Accordingly, we express no
opinion as to the laws of any other jurisdiction or as to any time after the date hereof. This
opinion is furnished to you solely in connection with the transactions described herein. This
opinion may not be used or relied upon by you for any other purpose and may not be relied upon for
any purpose by any other Person without our prior written consent; provided, however, that this
opinion may be delivered to your regulators, accountants, attorneys and other professional advisers
and may be used in connection with any legal or regulatory proceeding relating to the subject
matter of this opinion for the purpose of proving this opinion’s existence.

Very truly yours,

 

VORYS, SATER, SEYMOUR AND PEASE LLP

 

 

ANNEX A

SUBSIDIARIES

	 	 	 	 	 
	Subsidiary	 	 	 	State of Incorporation or Formation
	1.      Scotts-Sierra Horticultural Products Company

	 	 	 	California
	 
	 	 	 	 
	2.      Scotts-Sierra Investments, Inc.

	 	 	 	Delaware
	 
	 	 	 	 
	3.      Scotts Professional Products Co.

	 	 	 	Ohio
	 
	 	 	 	 
	4.      OMS Investments, Inc.

	 	 	 	Delaware
	 
	 	 	 	 
	5.      Miracle-Gro Lawn Products, Inc.

	 	 	 	New York
	 
	6.      Scotts-Sierra Crop Protection Company

	 	 	 	California
	 
	 	 	 	 
	7.      Swiss Farms Products, Inc.

	 	 	 	Delaware
	 
	 	 	 	 
	8.      Sanford Scientific, Inc.

	 	 	 	New York
	 
	 	 	 	 
	9.      Scotts Products Co.

	 	 	 	Ohio
	 
	 	 	 	 
	10.     Smith & Hawken, Ltd.

	 	 	 	Delaware
	 
	 	 	 	 
	11.     Rod McLellan Company

	 	 	 	California
	 
	 	 	 	 
	12.     Hyponex Corporation

	 	 	 	Delaware
	 
	 	 	 	 
	13.     Scotts Temecula Operations, LLC

	 	 	 	Delaware
	 
	 	 	 	 
	14.     Scotts Manufacturing Company

	 	 	 	Delaware
	 
	 	 	 	 
	15.     EG Systems, Inc.

	 	 	 	Indiana
	 
	 	 	 	 
	16.     Smith & Hawken, Ltd.

	 	 	 	Delaware
	 
	 	 	 	 
	17.     The Scotts Company LLC

	 	 	 	Ohio
	 
	 	 	 	 
	18.     SMG Growing Media, Inc.

	 	 	 	Ohio
	 
	 	 	 	 
	19.     Gutwein & Co., Inc.

	 	 	 	Indiana

 

 

ANNEX B

FINANCING STATEMENTS

	1.	 	UCC-3 Financing Statement Amendment naming The Scotts Miracle-Gro Company as debtor, to
be filed with the Ohio Secretary of State and describing the existing UCC-1 Financing
Statement.
	 
	2.	 	UCC-3 Financing Statement Amendment naming The Scotts Company LLC as debtor, to be
filed with the Ohio Secretary of State and describing the existing UCC-1 Financing
Statement.
	 
	3.	 	UCC-3 Financing Statement Amendment naming Scotts Manufacturing Company as debtor, to
be filed with the Delaware Secretary of State and describing the existing UCC-1 Financing
Statement.
	 
	4.	 	UCC-3 Financing Statement Amendment naming Scotts-Sierra Horticultural Products Company
as debtor, to be filed with the California Secretary of State and describing the existing
UCC-1 Financing Statement.
	 
	5.	 	UCC-3 Financing Statement Amendment naming OMS Investments, Inc. as debtor, to be filed
with the Delaware Secretary of State and describing the existing UCC-1 Financing Statement.
	 
	6.	 	UCC-3 Financing Statement Amendment naming Scotts-Sierra Investments, Inc. as debtor,
to be filed with the Delaware Secretary of State and describing the existing UCC-1
Financing Statement.
	 
	7.	 	UCC-3 Financing Statement Amendment naming SMG Growing Media, Inc. as debtor, to be
filed with the Ohio Secretary of State and describing the existing UCC-1 Financing
Statement.
	 
	8.	 	UCC-1 Financing Statement naming Miracle-Gro Lawn Products, Inc. as debtor and to be
filed with the New York Department of State.
	 
	9.	 	UCC-1 Financing Statement naming Hyponex Corporation as debtor and to be filed with the
Delaware Department of State.
	 
	10.	 	UCC-1 Financing Statement naming Scotts Products Co. as debtor and to be filed with the
Ohio Secretary of State.
	 
	11.	 	UCC-1 Financing Statement naming Scotts Professional Products Co. as debtor and to be
filed with the Ohio Secretary of State.
	 
	12.	 	UCC-1 Financing Statement naming Scotts-Sierra Crop Protection Company as debtor and to
be filed with the California Secretary of State.
	 
	13.	 	UCC-1 Financing Statement naming EG Systems, Inc. as debtor and to be filed with the
Indiana Secretary of State.
	 
	14.	 	UCC-1 Financing Statement naming Swiss Farms Products, Inc. as debtor and to be filed
with the Delaware Department of State.

 

 

	15.	 	UCC-1 Financing Statement naming Scotts Temecula Operations, LLC as debtor and to be
filed with the Delaware Department of State.
	 
	16.	 	UCC-1 Financing Statement naming Smith & Hawken, Ltd. as debtor and to be filed with
the Delaware Department of State.
	 
	17.	 	UCC-1 Financing Statement naming Sanford Scientific, Inc. as debtor and to be filed
with the New York Department of State.
	 
	18.	 	UCC-1 Financing Statement naming Gutwein & Co., Inc. as debtor and to be filed with the
Indiana Secretary of State.
	 
	19.	 	UCC-1 Financing Statement naming Rod McLellan Company as debtor and to be filed with
the California Secretary of State.

 

 

ANNEX C

GOOD STANDING/FULL FORCE AND EFFECT CERTIFICATES

	 	 	 	 	 	 	 
	 	 	Entity Name	 	State Issuing Certificate	 	Date of Certificate
	1.

	 	The Scotts Miracle-Gro Company, an Ohio

corporation
	 	Ohio Secretary of State
	 	1/26/07
	 
	 	 	 	 	 	 
	2.

	 	The Scotts Company LLC, an Ohio limited

liability company
	 	Ohio Secretary of State
	 	1/26/07
	 
	 	 	 	 	 	 
	3.

	 	EG Systems, Inc., an Indiana corporation
	 	Indiana Secretary of State
	 	1/23/07
	 
	 	 	 	 	 	 
	4.

	 	Hyponex Corporation, a Delaware corporation
	 	Delaware Secretary of State
	 	1/25/07
	 
	 	 	 	 	 	 
	5.

	 	OMS Investments, Inc., a Delaware corporation
	 	Delaware Secretary of State
	 	1/25/07
	 
	 	 	 	 	 	 
	6.

	 	Scotts Temecula Operations, LLC, a Delaware

corporation
	 	Delaware Secretary of State
	 	1/25/07
	 
	 	 	 	 	 	 
	7.

	 	Sanford Scientific, Inc., a New York corporation
	 	New York Department of State
	 	1/22/07
	 
	 	 	 	 	 	 
	8.

	 	Scotts Manufacturing Company, a Delaware

corporation
	 	Delaware Secretary of State
	 	1/25/07
	 
	 	 	 	 	 	 
	9.

	 	Miracle-Gro Lawn Products, Inc., a New York
corporation
	 	New York Department of State
	 	1/22/07
	 
	 	 	 	 	 	 
	10.

	 	Scotts Products Co., an Ohio corporation
	 	Ohio Secretary of State
	 	1/26/07
	 
	 	 	 	 	 	 
	11.

	 	Scotts Professional Products Co., an Ohio
corporation
	 	Ohio Secretary of State
	 	1/26/07
	 
	 	 	 	 	 	 
	12.

	 	Scotts-Sierra Horticultural Products Company, a

California corporation
	 	California Secretary of State
	 	1/19/07
	 
	 	 	 	 	 	 
	13.

	 	Scotts-Sierra Crop Protection Company, a

California corporation
	 	California Secretary of State
	 	1/19/07
	 
	 	 	 	 	 	 
	14.

	 	Scotts-Sierra Investments, Inc., a Delaware
corporation
	 	Delaware Secretary of State
	 	1/25/07
	 
	 	 	 	 	 	 
	15.

	 	Smith & Hawken, Ltd., a Delaware corporation
	 	Delaware Secretary of State
	 	1/25/07
	 
	 	 	 	 	 	 
	16.

	 	Swiss Farms Products, Inc., a Delaware
corporation
	 	Delaware Secretary of State
	 	1/25/07
	 
	 	 	 	 	 	 
	17.

	 	Gutwein & Co., Inc., an Indiana corporation
	 	Indiana Secretary of State
	 	1/23/07
	 
	 	 	 	 	 	 
	18.

	 	SMG Growing Media, Inc., an Ohio corporation
	 	Ohio Secretary of State
	 	1/26/07
	 
	 	 	 	 	 	 
	19.

	 	Rod McLellan Company, a California corporation
	 	California Secretary of State
	 	1/19/07

 

 

ANNEX D

STOCK OR SHARE CERTIFICATES

	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Certificate	 	 
	Issuer	 	Owner	 	Class of Stock	 	No.	 	No. of Shares
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Scotts 

Manufacturing 

Company

	 	The Scotts Company

LLC
	 	common shares, $.01
par value
	 	 	2	 	 	 	1,000	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Miracle-Gro Lawn
Products, Inc.

	 	Scotts

Manufacturing

Company
	 	voting common

stock, without par

value
	 	 	V14	 	 	 	1,000	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	Scotts

Manufacturing

Company
	 	non-voting common

stock, without par

value
	 	NV12
	 	 	999.8	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	OMS Investments,
Inc.

	 	The Scotts Company

LLC
	 	common stock,
$.01 par value
	 	 	3	 	 	 	100	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Hyponex Corporation

	 	The Scotts Company

LLC
	 	common stock,
$.01 par value
	 	 	3	 	 	 	100	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Scotts Products Co.

	 	The Scotts Company

LLC
	 	common shares,

without par value
	 	 	3	 	 	 	100	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Scotts Professional
Products Co.

	 	The Scotts Company

LLC
	 	common shares,

without par value
	 	 	3	 	 	 	100	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Scotts-Sierra 

Horticultural 

Products Company

	 	The Scotts Company

LLC
	 	Class A voting
common shares,
$.001 par value
	 	Class A Cert. No. 6
	 	 	101	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	The Scotts Company

LLC
	 	Class B non-voting
common shares,
	 	Class B Cert. No. 3
	 	 	1	 

 

 

	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Certificate	 	 
	Issuer	 	Owner	 	Class of Stock	 	No.	 	No. of Shares
	 

	 	 	 	$.001 par value	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Scotts-Sierra Crop 

Protection Company

	 	Scotts-Sierra

Horticultural

Products Company
	 	common shares,

without par value
	 	 	2	 	 	 	100	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Scotts-Sierra
Investments, Inc.

	 	Scotts-Sierra

Horticultural

Products Company
	 	Class A common
stock, without par
value
	 	 	5A	 	 	 	100	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	Scotts-Sierra

Horticultural

Products Company
	 	Class A common
stock, without par
value
	 	 	6A	 	 	 	1	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	Scotts-Sierra

Horticultural

Products Company
	 	Class B common
stock, without par
value
	 	 	3B	 	 	 	1	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Swiss Farms
Products, Inc.

	 	The Scotts Company

LLC
	 	common stock,

without par value
	 	 	2	 	 	 	100	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Smith & Hawken, Ltd.

	 	The Scotts Company

LLC
	 	common stock
	 	 	18	 	 	 	11,652,708	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	EG Systems, Inc.

	 	The Scotts Company
	 	common stock
	 	 	29	 	 	 	36,480,458	 
	 

	 	LLC	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Sanford Scientific,
Inc.

	 	The Scotts Company

LLC
	 	common stock
	 	 	8	 	 	 	99	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Gutwein & Co., Inc.

	 	The Scotts

Miracle-Gro Company
	 	common stock
	 	 	182	 	 	 	1,000	 

 

 

	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Certificate	 	 
	Issuer	 	Owner	 	Class of Stock	 	No.	 	No. of Shares
	SMG Growing Media,
Inc.

	 	The Scotts

Miracle-Gro Company
	 	common stock
	 	 	1	 	 	 	100	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Rod McLellan Company

	 	SMG Growing Media,
Inc.
	 	common stock
	 	 	189	 	 	 	100	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	The Scotts Company 

LLC

	 	The Scotts

Miracle-Gro Company
	 	limited liability

company interest

(not certificated)
	 	 	n/a	 	 	 	n/a	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Scotts Temecula 

Operations, LLC

	 	OMS Investments,
Inc.
	 	limited liability

company interest

(not certificated)
	 	 	n/a	 	 	 	n/a	 

 

 

Exhibit H

[DRAFT]

[DATED 7 FEBRUARY 2007]

[SUBJECT TO INTERNAL REVIEW]

 

CLIFFORD CHANCE OPINION LETTER

ISSUED IN CONNECTION WITH

THE PROVISION OF TERM

AND REVOLVING CREDIT FACILITIES

TO THE SCOTTS MIRACLE-GRO COMPANY

AND CERTAIN OF ITS SUBSIDIARIES

 

 

 

[7] February 2007

To JPMorgan Chase Bank, N.A. as Administrative Agent and the Lenders (each as
defined below)

Dear Sirs

The Scotts Miracle-Gro Company — 2007 Amended and Restated Credit Agreement

We have acted as English legal advisers to The Scotts Miracle-Gro Company (the “Borrower”) in
connection with the provision of US$2.15 billion term and revolving credit facilities to the
Borrower and certain of its subsidiaries by the Lenders (the “Transaction”).

	1.	 	INTRODUCTION
	 
	1.1	 	English Opinion Documents
	 
	 	 	The opinions given in this Opinion Letter relate to the following documents entered
into in connection with the Transaction (the “Opinion Documents”):

	 	1.1.1	 	the amended and restated credit agreement dated on or about the date hereof
between, inter alia, the Borrower, the subsidiary borrowers from time to time party
thereto, the several lenders from time to time party thereto and JPMorgan Chase Bank,
N.A., as agent for the Lenders (the “Administrative Agent”) which amends and restates
the revolving credit agreement dated 21 July 2005 which is expressed to be governed by
the laws of New York (the “Amended and Restated Credit Agreement”);
	 
	 	1.1.2	 	the deed of confirmation dated on or about the date hereof granted by Scotts
Holdings Limited in favour of the Administrative Agent in respect of the English law
governed share pledge dated 21 July 2005 over 65 per cent. of its shareholding in O M
Scott International Investments Limited;
	 
	 	1.1.3	 	the deed of confirmation dated on or about the dated hereof granted by Scotts
Holdings Limited in favour of the Administrative Agent in respect of the English law
governed share pledge dated 21 July 2005 over its entire shareholding in Levington
Group Limited;
	 
	 	1.1.4	 	the deed of confirmation dated on or about the date hereof granted by The
Scotts Company (UK) Limited in favour of the Administrative Agent in respect

 

 

	 	 	 	of the English law governed share pledge dated 21 July 2005 over 65 per cent. of
its shareholding in The Scotts Company (Manufacturing) Limited;
	 
	 	1.1.5	 	the deed of confirmation dated on or about the date hereof granted by
Levington Group Limited in favour of the Administrative Agent in respect of the English
law governed share pledge dated 21 July 2005 over its entire shareholding in The Scotts
Company (UK) Limited; and
	 
	 	1.1.6	 	the deed of confirmation dated on or about the date hereof granted by
Scotts-Sierra Investments, Inc. in favour of the Administrative Agent in respect of the
English law governed share pledge dated 21 July 2005 over its entire shareholding in
Scotts Holdings Limited.

	1.2	 	Defined terms
	 
	 	 	In this Opinion Letter:

	 	1.2.1	 	“English Obligor” means each of the companies specified in Schedule 1
(English Obligors);
	 
	 	1.2.2	 	“English Opinion Documents” means each of the documents listed in paragraphs
1.1.2 to 1.1.6 (inclusive);
	 
	 	1.2.3	 	“Finance Party” means each of the Administrative Agent and the Lenders;
	 
	 	1.2.4	 	“Lender” means any person which is a “Lender” under the Amended and Restated
Credit Agreement as at the date of this Opinion Letter;
	 
	 	1.2.5	 	terms defined or given a particular construction in the Amended and Restated
Credit Agreement have the same meaning in this Opinion Letter unless a contrary
indication appears; and
	 
	 	1.2.6	 	headings in this Opinion Letter are for ease of reference only and shall not
affect its interpretation.

	1.3	 	Legal review
	 
	 	 	For the purpose of issuing this Opinion Letter we have reviewed only the documents and
completed only the searches and enquiries referred to in Schedule 2 (Documents and
enquiries) to this Opinion Letter.
	 
	1.4	 	Applicable law
	 
	 	 	This Opinion Letter and the opinions given in it are governed by English law and relate
only to English law as applied by the English courts as at today’s date. We express no
opinion in this Opinion Letter on the laws of any other jurisdiction.
	 
	1.5	 	Assumptions and reservations
	 
	 	 	The opinions given in this Opinion Letter are given on the basis of our understanding
of the terms of the Opinion Documents and the assumptions set out in Schedule 3
(Assumptions) and are subject to the reservations set out in Schedule 4 (Reservations) to
this Opinion Letter. The opinions given in this Opinion Letter are strictly limited to the
matters stated in paragraph 2 (Opinions) and do not extend to any other matters.

- 3 -

 

	2.	 	OPINIONS
	 
	 	 	We are of the opinion that:
	 
	2.1	 	Corporate existence

	 	2.1.1	 	Each of the English Obligors is a company or a body corporate duly
incorporated or registered in England and has the capacity and power to enter into each
of the Opinion Documents to which it is a party and to exercise its rights and perform
its obligations under those Opinion Documents.
	 
	 	2.1.2	 	All corporate action required to authorise the execution by each English
Obligor of each of the Opinion Documents to which it is a party and the exercise by it
of its rights and the performance by it of its obligations under those Opinion
Documents has been duly taken.

	2.2	 	Due execution
	 
	 	 	The Amended and Restated Credit Agreement has been duly executed by each of the English
Obligors to the extent that English law is applicable.
	 
	2.3	 	Conflict
	 
	 	 	Neither the execution nor the delivery of any Opinion Document to which it is a party
by the English Obligors nor the performance of the obligations of the English Obligors under
any Opinion Document to which it is a party conflict with or will conflict with:

	 	2.3.1	 	any present law or regulation having the force of law in England and
applicable to the English Obligors; or
	 
	 	2.3.2	 	any term of the memorandum and articles of association or constitutive
documents of each of the English Obligors.

	2.4	 	Legal, valid, binding and enforceable obligations
	 
	 	 	The obligations expressed to be assumed by each of the English Obligors in the English
Opinion Documents to which it is a party constitute its legal, valid, binding and
enforceable obligations.
	 
	 	 	In any proceedings taken in England for the enforcement of the Amended and Restated Credit
Agreement, the obligations expressed to be assumed by each of the English Obligors in the
Amended and Restated Credit Agreement to which it is a party would be recognised by the
English courts as its legal, valid and binding obligations and would be enforceable in the
English courts.
	 
	2.5	 	Further acts
	 
	 	 	No further acts, conditions or things are required by English law to be done, fulfilled
or performed in order to enable any of the English Obligors lawfully to enter into, exercise
its rights or perform its obligations under any of the Opinion Documents or to make any of
the Opinion Documents to which it is a party admissible in evidence in England.
	 
	2.6	 	Stamp taxes
	 
	 	 	No United Kingdom ad valorem stamp duty, stamp duty reserve tax or stamp duty land tax
is payable on the execution (or where the relevant document is a deed, the delivery) of any
of the Opinion Documents.

- 4 -

 

	2.7	 	Governing law
	 
	 	 	In any proceedings taken in England for the enforcement of the obligations of the
English Obligors under any Opinion Document to which it is a party, the English courts would
give effect to the choice of English law as the governing law of each of the English Opinion
Documents, and recognise the choice of the laws of New York to govern the Amended and
Restated Credit Agreement subject to the provisions of the Contracts (Applicable Law) Act
1990.
	 
	2.8	 	Submission to jurisdiction
	 
	 	 	The submission to the jurisdiction of the courts of New York by the relevant English
Obligors contained in the Amended and Restated Credit Agreement is legal, valid and binding.
	 
	2.9	 	Enforcement of foreign judgment
	 
	 	 	The English courts will enforce by separate action a final and conclusive judgment for
a definite sum of money (not being a sum payable in respect of taxes or other charges of a
like nature or in respect of a fine or other penalty) entered against therelevant English
Obligors in connection with the enforcement of the Amended and Restated Credit Agreement in
civil proceedings in a court of competent jurisdiction in New York.
	 
	3.	 	LIMITS OF OPINION
	 
	 	 	We express no opinion as to any liability to taxation which may arise or be suffered as
a result of or in connection with the Opinion Documents or the Transaction other than as
mentioned in paragraph 2.6 (Stamp taxes).
	 
	 	 	We have not been involved in the negotiation or preparation of the Amended and Restated
Credit Agreement or the other agreements referred to therein (which have not been reviewed
by us for the purpose of giving the opinions set out in this Opinion Letter) and we express
no opinion as to whether the terms of the Amended and Restated Credit Agreement are adequate
to fulfil the intentions of the parties with respect thereto.
	 
	4.	 	ADDRESSEES AND PURPOSE
	 
	 	 	This Opinion Letter is provided in connection with the satisfaction of the conditions
precedent under the Amended and Restated Credit Agreement and is addressed to the
Administrative Agent and the Lenders. It may not, without our prior written consent, be
relied upon for any other purpose or be disclosed to or relied upon by any other person.

Yours faithfully

Clifford Chance LLP

- 5 -

 

SCHEDULE 1

ENGLISH OBLIGORS

Scotts Treasury EEIG, registered number GE000180

Scotts Holdings Limited, registered number 03473956

The Scotts Company (UK) Limited, registered number 02924130

Levington Group Limited, registered number 02906877

- 6 -

 

SCHEDULE 2

Documents and Enquiries

	1.	 	DOCUMENTS

     We have reviewed only the following documents for the purposes of this Opinion Letter.

	 	(a)	 	The Opinion Documents in the forms set out below:

	 	(i)	 	an executed faxed copy of the Amended and Restated Credit Agreement;
and
	 
	 	(ii)	 	an executed faxed copy of each English Opinion Document.

	 	(b)	 	A certified copy of the certificate of incorporation (and any certificate of
incorporation on change of name) and memorandum and articles of association of each
English Obligor (other than Scotts Treasury EEIG).
	 
	 	(c)	 	A certified copy of the certificate of incorporation, formation agreement,
management agreement and operating agreement (the “Constitutive Documents”) of Scotts
Treasury EEIG.
	 
	 	(d)	 	A certified copy of the resolutions in writing of the directors of Scotts
Holdings Limited and The Scotts Company (UK) Limited dated
[•] February 2007.
	 
	 	(e)	 	A certified copy of a written resolution of the shareholders of Scotts
Holdings Limited and The Scotts Company (UK) Limited dated [•] February 2007.
	 
	 	(f)	 	A copy of the resolutions in writing of the directors of Levington Group
Limited dated [•] February 2007.
	 
	 	(g)	 	A copy of a written resolution of the shareholder of Levington Group Limited
dated [•] February 2007.
	 
	 	(h)	 	A certified copy of the written resolutions of the members’ representatives of
Scotts Treasury EEIG dated [•] February 2007 (the “Members’ Representatives
Resolutions”).
	 
	 	(i)	 	A certificate of an officer of each English Obligor (other than Levington
Group Limited) dated [•] February 2007.

	2.	 	SEARCHES AND ENQUIRIES

We have undertaken only the following searches and enquiries for the purposes of this
Opinion Letter.

	 	(a)	 	A search was conducted with the Registrar of Companies in respect of each
English Obligor on [•] February 2007.

- 7 -

 

	 	(b)	 	An enquiry by telephone was made at the Companies Court in London of the
Central Index of Winding Up Petitions on [•] February 2007 at [•]
[a.m./p.m.] with respect to each English Obligor.

- 8 -

 

SCHEDULE 3

Assumptions

The opinions in this Opinion Letter have been made on the following assumptions.

	1.	 	ORIGINAL AND GENUINE DOCUMENTATION

	 	(a)	 	All signatures, stamps and seals are genuine, all original documents are
authentic and all copy documents are complete and conform to the originals.
	 
	 	(b)	 	Any certificate referred to in Schedule 2 (Documents and enquiries) is correct
in all respects.
	 
	 	(c)	 	The authorised signatories executing the Members’ Representatives Resolutions
delivered to the Administrative Agent pursuant to the Amended and Restated Credit
Agreement are so authorised by the relevant member of Scotts Treasury EEIG.

	2.	 	OBLIGATIONS OF THE PARTIES OTHER THAN THE ENGLISH OBLIGORS

	 	(a)	 	Each party to the Opinion Documents (other than the English
Obligors) has the capacity, power and authority to enter into and to exercise its
rights and to perform its obligations under the Opinion Documents to which it is a
party.
	 
	 	(b)	 	Each party to the Opinion Documents (other than the English Obligors) has duly
executed and delivered the Opinion Documents.
	 
	 	(c)	 	The Administrative Agent has complied with the Financial Services and Markets
Act 2000 and the Financial Services and Markets Act 2000 (Regulated Activities) Order
2001 in relation to any security taken over shares, securities or other investments
(falling within the scope of the term “investment”, as defined in that Act).
	 
	 	(d)	 	The steps taken by which any person not originally a party to the Amended and
Restated Credit Agreement, or any other Opinion Document, becomes a Lender under the
Amended and Restated Credit Agreement, or otherwise becomes entitled to any rights
under any of the other Opinion Documents, are effective to ensure that it is treated as
a party to the Amended and Restated Credit Agreement, and the relevant Opinion
Documents, under the laws of New York and are within the capacity and powers of, and
are duly authorised by, each of the relevant parties.
	 
	 	(e)	 	Each of the Lenders is at all relevant times a person acting in the course of
carrying on a business consisting wholly or to a significant extent of lending money or
is otherwise a person of a kind specified in article 6 of the Financial Services and
Markets Act 2000 (Regulated Activities) Order 2001.

- 9 -

 

	3.	 	DOCUMENT NOT GOVERNED BY ENGLISH LAW

	 	(a)	 	The obligations expressed to be assumed by the parties to the Amended and
Restated Credit Agreement constitute their legal, valid, binding and enforceable
obligations under the laws of New York.
	 
	 	(b)	 	The submission to the jurisdiction of the courts of New York by the English
Obligors contained in the Amended and Restated Credit Agreement is legal, valid and
binding under the laws of New York.
	 
	 	(c)	 	The choice of the laws of New York to govern the Amended and Restated Credit
Agreement is a valid choice under the laws of New York.

	4.	 	CORPORATE AUTHORITY OF THE ENGLISH OBLIGORS

	 	(a)	 	There have been no amendments to the form of the memorandum and articles of
association of any English Obligor (other than Scotts Treasury EEIG) or to the
Constitutive Documents of Scotts Treasury EEIG referred to in Schedule 2 (Documents and
enquiries).
	 
	 	(b)	 	The resolutions in writing of the board of directors of each English Obligor
(other than Scotts Treasury EEIG) referred to in Schedule 2 (Documents and enquiries)
have not been amended or rescinded and are in full force and effect.
	 
	 	(c)	 	The resolutions of the shareholders of each English Obligor (other than Scotts
Treasury EEIG) referred to in Schedule 2 (Documents and enquiries) has been duly
adopted by the shareholders of each English Obligor (other than Scotts Treasury EEIG)
and has not been amended or rescinded and is in full force and effect.
	 
	 	(d)	 	Each director has disclosed any interest which he may have in the transactions
contemplated by the Opinion Documents in accordance with the provisions of the
Companies Act 1985 and the articles of association of the relevant English Obligor and
none of the directors of that English Obligor has any interest in such transactions
except to the extent permitted by the articles of association of that English Obligor.
	 
	 	(e)	 	The execution and delivery of the Opinion Documents to which it is a party by
each English Obligor and the exercise of its rights and performance of its obligations
under those Opinion Documents will sufficiently benefit and is in the interests of that
English Obligor. [In particular, whilst the resolutions in writing referred to in
paragraphs 1(d), 1(f) and 1(h) of Schedule 2 (Documents and Enquiries) state that the
board of directors of the English Obligors and the members’ representatives of Scotts
Treasury EEIG (where applicable) pursuant to the Opinion Documents has considered
whether the English Obligors will derive a benefit from the transactions referred to
therein, this is a question of fact relating to the nature of the business and
operations of the English Obligors and we do not express any opinion as to whether the
English courts would determine that the English Obligors in fact derived a benefit from
that transaction.]

- 10 -

 

	 	(f)	 	The Amended and Restated Credit Agreement states that the purpose of the
Facilities is amongst others, to repay the amounts outstanding under the Existing
Credit Agreement, redeem all or any portion of the Existing Senior Subordinated Notes,
consummate the stock buyback and pay the contemplated special dividend in the aggregate
amount of up to $750 million and to pay related fees and expenses and for the working
capital needs and general corporate purposes of the Borrower and certain of its
subsidiaries. We assume that this does not include any financing or refinancing of an
acquisition of shares in contravention of section 151 of the Companies Act 1985.
	 
	 	(g)	 	The directors of each English Obligor (other than Scotts Treasury EEIG) acted
in good faith and in the interests of that English Obligor (other than Scotts Treasury
EEIG) in approving the Opinion Documents and the Transaction.
	 
	 	(h)	 	Where applicable, the provisions of the articles of association or
Constitutive Documents of the relevant English Obligors (which limit the English
Obligors’ directors’ or, where applicable, duly authorised officers’ authority to
borrow) have been, and will be, duly observed.

	5.	 	SEARCHES AND ENQUIRIES
	 
	 	 	There has been no alteration in the status or condition of any English Obligor as disclosed
by the searches and enquiries referred to in Schedule 2 (Documents and enquiries). However,
it is our experience that the searches and enquiries referred to in paragraphs 2(a) and (b)
of Schedule 2 (Documents and enquiries) may be unreliable. In particular, they are not
conclusively capable of disclosing whether or not insolvency proceedings have been
commenced.
	 
	6.	 	OTHER DOCUMENTS
	 
	 	 	Save for those listed in Schedule 2 (Documents and enquiries), there is no other agreement,
instrument or other arrangement between any of the parties to any of the Opinion Documents
which modifies or supersedes any of the Opinion Documents.
	 
	7.	 	OTHER LAWS
	 
	 	 	All acts, conditions or things required to be fulfilled, performed or effected in connection
with the Opinion Documents under the laws of any jurisdiction other than England have been
duly fulfilled, performed and effected.

- 11 -

 

SCHEDULE 4

Reservations

The opinions in this Opinion Letter are subject to the following reservations.

	1.	 	EFFECTIVENESS OF SECURITY

	 	(a)	 	We express no opinion as to:

	 	(i)	 	whether the relevant English Obligors have good legal or other title
to the assets or rights which are expressed to be subject to a security
interest under the English Opinion Documents, or as to the existence or value
of any such assets or rights;
	 
	 	(ii)	 	the priority of any security interest created under the English
Opinion Documents or whether any security interest constitutes a legal or
equitable security interest or a fixed or specific (rather than a floating)
charge; or
	 
	 	(iii)	 	whether the Opinion Documents breach any other agreement or
instrument.

	 	(b)	 	The exercise by the Administrative Agent of the powers and remedies conferred
by any English Opinion Document or by law is subject to general equitable principles
regarding the enforcement of security and the supervisory powers of the English courts.
	 
	 	(c)	 	Any obligation imposed on an English Obligor to hold certain moneys to the
order of the Administrative Agent pursuant to an Opinion Document may constitute a
charge which may be required to be registered in accordance with the Companies Act
1985. This provision has not been registered.

	2.	 	LIMITATIONS ARISING FROM INSOLVENCY LAW

	 	(a)	 	The opinion set out in paragraph 2.4 (Legal, valid, binding and enforceable
obligations) of this Opinion Letter is subject to any limitations arising from
insolvency, liquidation, administration, moratorium, reorganisation and similar laws
generally affecting the rights of creditors.
	 
	 	(b)	 	Any provision in any Opinion Document which confers, purports to confer or
waives a right of set-off or similar right may be ineffective against a liquidator or
creditor.

	3.	 	ENFORCEABILITY OF CLAIMS: ENGLISH LAW OPINION DOCUMENTS

In this Opinion Letter “enforceable” means that an obligation is of a type which the English
courts enforce. It does not mean that those obligations will be enforced in all
circumstances in accordance with the terms of the Opinion Documents expressed to be governed
by English law. In particular:

	 	(a)	 	the power of an English court to order specific performance of an obligation
or other equitable remedy is discretionary and, accordingly, an English court might

- 12 -

 

	 	 	 	make an award of damages where specific performance of an obligation or other
equitable remedy is sought;
	 
	 	(b)	 	where any party to the English Opinion Documents is vested with a discretion
or may determine a matter in its opinion, that party may be required to exercise its
discretion in good faith, reasonably and for a proper purpose, and to form its opinion
in good faith and on reasonable grounds;
	 
	 	(c)	 	enforcement may be limited by the provisions of English law applicable to
agreements held to have been frustrated by events happening after its execution;
	 
	 	(d)	 	claims may become barred under the Limitation Act 1980 or the Foreign
Limitation Periods Act 1984 or may be or become subject to a defence of set-off or
counterclaim;
	 
	 	(e)	 	in some circumstances an English court may, and in certain circumstances it
must, terminate or suspend proceedings commenced before it, or decline to restrain
proceedings commenced in another court, notwithstanding the provisions of the English
Opinion Documents providing that the courts of England have jurisdiction in relation
thereto;
	 
	 	(f)	 	a party to a contract may be able to avoid its obligations under that contract
(and may have other remedies) where it has been induced to enter into that contract by
a misrepresentation and the English courts will generally not enforce an obligation if
there has been fraud;
	 
	 	(g)	 	whilst an English court has power to give judgment in a currency other than
pounds sterling, it has the discretion to decline to do so; and
	 
	 	(h)	 	any provision providing that any calculation, determination or certification
is to be conclusive and binding may not be effective if such calculation, determination
or certification is fraudulent or manifestly incorrect and an English court may regard
any certification, determination or calculation as no more than prima facie evidence.

	4.	 	GOVERNING LAW

	 	(a)	 	An English court may not apply the laws of New York if to do so would be
contrary to public policy or mandatory rules of English law. Based on our review of
the Amended and Restated Credit Agreement, in our opinion, none of the provisions of
the Amended and Restated Credit Agreement would be contrary to public policy or
mandatory rules of English law (except as otherwise stated in this Schedule).
	 
	 	(b)	 	If all the elements relevant to the situation are connected with one country
only, the choice of New York law will not prejudice the application of rules of law of
that country which cannot be derogated from by contract.

- 13 -

 

	5.	 	JURISDICTION

If any proceedings are brought in the English courts, those courts may accept jurisdiction
in certain cases, notwithstanding the provisions of the Amended and Restated Credit
Agreement providing that the courts of New York have exclusive jurisdiction in relation
thereto.

	6.	 	ENFORCEMENT OF FOREIGN JUDGMENT

	 	(a)	 	There are no reciprocal arrangements in force between New York and the United
Kingdom for the recognition or enforcement of judgments. Accordingly, a judgment by
the courts of New York is not enforceable directly in England but may be recognised and
enforced by the English courts according to common law principles. A judgment by those
courts will not be enforced by the English courts if:

	 	(i)	 	those courts had no jurisdiction, as a matter of English law, over the
defendant;
	 
	 	(ii)	 	the proceedings in which the judgment was given were opposed to
natural justice;
	 
	 	(iii)	 	the judgment was obtained by fraud;
	 
	 	(iv)	 	the enforcement of the judgment would be contrary to English public
policy;
	 
	 	(v)	 	an order has been made and remains effective under section 9 of the
Foreign Judgments (Reciprocal Enforcement) Act 1933 applying that section to
judgments of those courts;
	 
	 	(vi)	 	before the date on which those courts gave judgment, the matter in
dispute had been the subject of a final judgment of another court having
jurisdiction whose judgment is enforceable in England;
	 
	 	(vii)	 	the judgment is for multiple damages within the meaning of section
5(3) of the Protection of Trading Interests Act 1980;
	 
	 	(viii)	 	the judgment is based on a rule of law specified by the Secretary
of State under section 5(4) of the Protection of Trading Interests Act 1980 as
concerned with the prohibition of restrictive trade practices;
	 
	 	(ix)	 	the judgment is on a claim for contribution in respect of damages
awarded by a judgment falling within (vii) or (viii) above;
	 
	 	(x)	 	the judgment is based on foreign measures which the Secretary of State
specifies as regulating and controlling international trade and which, in so
far as they apply to persons carrying on business in the United Kingdom, are
damaging or threaten to damage the trading interests of the United Kingdom; or

- 14 -

 

	 	(xi)	 	the bringing of proceedings in those courts was contrary to an
agreement under which the dispute in question was to be settled otherwise than
by proceedings in those courts.

	 	(b)	 	If the English court gives judgment for the sum payable under a judgment of
the courts of New York, the English judgment would be enforceable by the methods
generally available for the enforcement of English judgments. These give the court a
discretion whether to allow enforcement by any particular method. In addition, it may
not be possible to obtain an English judgment or to enforce any English judgment if the
judgment debtor is subject to any insolvency or similar proceedings, if there is delay,
if an appeal is pending or anticipated against the English judgment in England or
against the foreign judgment in the courts of New York or if the judgment debtor has
any set-off or counterclaim against the judgment creditor.

	7.	 	APPLICATION OF FOREIGN LAW

	 	(a)	 	If any obligation is to be performed in a jurisdiction outside England, it may
not be enforceable in England to the extent that performance would be illegal or
contrary to public policy under the laws of the other jurisdiction and an English court
may take into account the law of the place of performance in relation to the manner of
performance and to the steps to be taken in the event of defective performance.
	 
	 	(b)	 	It is uncertain whether the parties can agree in advance the governing law of
claims connected with the contract but which are not claims on the contract, such as a
claim in tort.
	 
	 	(c)	 	We express no opinion as to whether any English Obligor has created a valid
security interest over any asset or right which is situated outside England (including
those situated outside England and Wales within the meaning of Council Regulation (EC)
No. 1346/2000 of 29 May 2000 on insolvency proceedings) or governed by a foreign law
(notwithstanding the choice of English law as the governing law of the English Opinion
Documents).

	8.	 	DEFAULT INTEREST AND INDEMNITIES BETWEEN PARTIES

	 	(a)	 	Any provision of the Opinion Documents requiring any person to pay amounts
imposed in circumstances of breach or default may be held to be unenforceable on the
grounds that it is a penalty. If the English Opinion Documents do not provide a
contractual remedy for late payment of any amount payable thereunder that is a
substantial remedy within the meaning of the Late Payment of Commercial Debts
(Interest) Act 1998, the person entitled to that amount may have a right to statutory
interest (and to payment of certain fixed sums) in respect of that late payment at the
rate (and in the amount) from time to time prescribed pursuant to that Act. Any term
of the English Opinion Documents may be void to the extent that it excludes or varies
that right to statutory interest, or purports to confer a contractual right to interest
that is not a

- 15 -

 

	 	 	 	substantial remedy for late payment of that amount, within the meaning of that Act.
	 
	 	(b)	 	There is some possibility that an English court would hold that a judgment on
any Opinion Document, whether given in an English court or elsewhere, would supersede
that Opinion Document so that any obligations relating to the payment of interest after
judgment or any currency indemnities would not be held to survive judgment.
	 
	 	(c)	 	Any undertaking or indemnity given by an English Obligor in respect of stamp
duty payable in the United Kingdom may be void.
	 
	 	(d)	 	An English court may in its discretion decline to give effect to any indemnity
for legal costs incurred by a litigant.

	9.	 	OTHER QUALIFICATIONS

	9.1	 	In respect of the English Opinion Documents:

	 	(a)	 	the parties to a English Opinion Document may be able to amend that English
Opinion Document by oral agreement despite any provision to the contrary;
	 
	 	(b)	 	to the extent that any matter is expressly to be determined by future
agreement or negotiation, the relevant provision may be unenforceable or void for
uncertainty;
	 
	 	(c)	 	any provision of the English Opinion Documents stating that a failure or
delay, on the part of any Finance Party, in exercising any right or remedy under the
English Opinion Documents shall not operate as a waiver of such right or remedy may not
be effective; and
	 
	 	(d)	 	the effectiveness of any provision of a English Opinion Document which allows
an invalid provision to be severed in order to save the remainder of that English
Opinion Document will be determined by the English courts in their discretion.

	9.2	 	In respect of Opinion Documents expressed to be governed by the laws of New York:

	 	(a)	 	the power of an English court to order specific performance of an obligation
or other equitable remedy is discretionary and accordingly, an English court might make
an award of damages where specific performance of an obligation or other equitable
remedy is sought;
	 
	 	(b)	 	claims may become barred under the Limitation Act 1980 or the Foreign
Limitation Periods Act 1984 or may be or become subject to a defence of set-off or
counterclaim;
	 
	 	(c)	 	in some circumstances an English court may, and in certain circumstances it
must, terminate or suspend proceedings commenced before it notwithstanding the
provisions of the Amended and Restated Credit Agreement providing that no Finance Party
shall be prevented from taking proceedings in any other courts with jurisdiction and an
English court may be prevented from adjudicating upon

- 16 -

 

	 	 	 	a particular claim or issue if this would be inconsistent with the judgment of a
foreign court binding upon the parties, being a judgment entitled to recognition in
England and Wales; and
	 
	 	(d)	 	whilst an English court has power to give judgment in a currency other than
pounds sterling, it has the discretion to decline to do so.

	9.3	 	In respect of the Opinion Documents generally:

	 	(a)	 	any provision of any Opinion Document which constitutes, or purports to
constitute, a restriction on the exercise of any statutory power by any party to an
Opinion Document or any other person may be ineffective;
	 
	 	(b)	 	if a party to the Opinion Documents is controlled by or otherwise connected
with a person (or is itself) resident in, incorporated in or constituted under the laws
of a country which is the subject of United Nations, European Community or UK sanctions
implemented or effective in the United Kingdom under the United Nations Act 1946, the
Emergency Laws (Re-enactments and Repeals) Act 1964 or the Anti-terrorism, Crime and
Security Act 2001, or under the Treaty establishing the European Community, or is
otherwise the target of any such sanctions, then the obligations of the English
Obligors to that party (or if that party is an English Obligor, the obligations of that
English Obligor) under the Opinion Documents may be unenforceable or void; and
	 
	 	(c)	 	we express no opinion as to whether any United Kingdom stamp duty, stamp duty
reserve tax or stamp duty land tax is required to be paid on or in relation to any
assignment or other transfer of any right or interest under the Amended and Restated
Credit Agreement, or any other Opinion Document, to a person not originally a party
thereto.

- 17 -

 

Borden Ladner Gervais LLP

Lawyers • Patent & Trade-mark Agents

Scotia Plaza, 40 King Street West

Toronto, Ontario, Canada M5H 3Y4

tel.: (416) 367-6000 fax: (416) 367-6749

www.blgcanada.com

February 8, 2007

JPMorgan Chase Bank, N.A.

270 Park Avenue

New York, NY 10017

as administrative agent for itself and for each of the Lenders

(as defined in the Credit Agreement referred to below)

(the “Administrative Agent”) and to the Lenders

Dear Sirs:

Re:       Scotts Canada Ltd.

We have acted as special counsel in Ontario to Scotts Canada Ltd. (the “Corporation”) and
Scotts-Sierra Investments Inc. (“Sierra”) in connection with:

	1.	 	an amended and restated credit agreement dated as of February 8, 2007 (the “Credit
Agreement”) by and among , inter alia, The Scotts Miracle-Gro Company (the “Borrower”), the
subsidiary borrowers from time to time party thereto, the several lenders from time to time
party thereto (the “Lenders”), the Administrative Agent and the other agents named therein;
and
	 
	2.	 	a foreign pledge agreement acknowledgment and confirmation dated as of February 8, 2007 from,
inter alia, Sierra in favour of the Administrative Agent (the “Sierra Acknowledgment”)
relating to a share pledge agreement dated October • , 2005 given by Sierra in favour of
the Administrative Agent (the “Sierra Pledge”).

Terms defined in the Credit Agreement and not redefined herein have the same meanings when used in
this opinion.

For the purposes of giving this opinion we have examined a copies of each of the above-noted
documents. We have also examined such other documents, and considered such questions of law, as we
have deemed necessary as a basis for the opinions expressed herein.

In our examinations referenced above, and in rendering this opinion, we have assumed:

	(a)	 	the genuineness of all signatures;
	 
	(b)	 	the authenticity and completeness of all documents submitted to us as originals;

Catgary       *       Montreal       *       Ottawa       *       Toronoto       *       Vancouver

 

 

	(c)	 	the conformity to original documents and the completeness of all documents submitted to us as
certified copies or photocopies and the authenticity of the originals where certified copies
or photocopies have been submitted;
	 
	(d)	 	the conformity to original documents and the completeness of all documents received by us by
facsimile transmission and the authenticity of the originals of such documents;
	 
	(e)	 	the execution, delivery and performance by Sierra of the Sierra Acknowledgment has been duly
authorized by all necessary corporate action on Sierra’s part, and the Sierra Acknowledgment
has been duly executed and delivered on behalf of Sierra;
	 
	(f)	 	the Sierra Acknowledgment constitutes a valid and legally binding obligation of Sierra under
the laws of New York; and
	 
	(g)	 	the Administrative Agent continues to be in possession of the certificate representing 100
common shares of the Corporation (the “Pledged Shares”).

We previously registered a financing statement on behalf of the Administrative Agent against Sierra-
under the Personal Property Security Act (Ontario) (the “PPSA”) on October 19, 2005 as registration
no. 20051019 1445 8028 6679 for a period of 10 years.

This opinion is limited to, and we have not investigated the laws of any jurisdiction other than,
the laws of Ontario and the federal laws of Canada applicable in Ontario (the “Law of Ontario”) and
this opinion is given only with respect to the Law of Ontario in effect as at the date of this
opinion. Without limiting the generality of the immediately preceding sentence, we express no
opinion with respect to the laws of any other jurisdiction to the extent that those laws may govern
the validity, perfection, effect of perfection or non-perfection or enforcement of the security
interest created by the Sierra Pledge as a result of the application of Ontario conflict of laws
rules, including, without limitation, sections 5 to 8 of the PPSA. In addition, we express no
opinion whether, pursuant to those conflict of laws rules, Ontario laws would govern the validity,
perfection, effect of perfection or non-perfection or enforcement of those security interests.

In expressing the opinion set forth in paragraph 1 below, we have obtained and relied upon a
Certificate of Compliance dated February 8, 2007 issued by Industry Canada (a copy of which has
been delivered to you), and have assumed, with your concurrence, that such certificate evidences
that the Corporation has not been dissolved as of the date hereof.

Based upon and subject to the foregoing and to any matters not disclosed to us, it is our opinion
that, so far as the Law of Ontario is concerned:

	1.	 	The Corporation is a company incorporated and existing under the Canada Business Corporations
Act and has not been dissolved.
	 
	2.	 	The authorized capital of the Corporation consists of an unlimited number of common shares,
of which 100 common shares are issued and outstanding.

2

 

	3.	 	The Pledged Shares have been validly issued and are outstanding and Sierra is the registered
owner of the Pledged Shares.
	 
	4.	 	The Sierra Pledge (as acknowledged and confirmed pursuant to the Sierra Acknowledgment)
creates a valid security interest in favour of the Administrative Agent in all right, title
and interest of Sierra in and to the Pledged Shares.
	 
	5.	 	Provided that the Administrative Agent is acting in good faith and has no notice of any
adverse claim affecting the Pledged Shares, the security interest of the Administrative Agent
in the Pledged Shares has priority over any other security interest in the Pledged Shares
perfected by registration or temporarily perfected under the PPSA, and the Administrative
Agent has acquired the Pledged Shares free of any adverse claim.
	 
	6.	 	Registration has been made in all public offices provided for under the Law of Ontario where
such registration is necessary or desirable to preserve, protect or perfect the security
interest created by the Sierra Pledge in favour of the Administrative Agent in the Pledged
Shares.
	 
	7.	 	No stamp, registration, documentary or similar tax, duty or fee is payable under the Law of
Ontario in connection with the execution and delivery of the Sierra Acknowledgment.
	 
	8.	 	Neither the Administrative Agent nor any Lender will be deemed to be resident or carrying on
business in Canada or in Ontario or subject to taxation in Canada or Ontario, by reason only
of the execution, performance or enforcement of the Sierra Pledge.
	 
	9.	 	It is not necessary under the Law of Ontario (i) to enable the Lenders or the Administrative
Agent to enforce their respective rights under the Sierra Pledge or (ii) by reason of the
execution or performance of the Sierra Pledge that any of them should be licensed, qualified
or entitled to carry on business in Canada.
	 
	10.	 	In any proceedings taken in Canada relative to the Sierra Pledge, Sierra will not be entitled
to claim for itself, or any of its assets, immunity from suit, execution or attachment of
legal process.
	 
	11.	 	The contractual attornment of Sierra pursuant to the Sierra Pledge would be recognized by an
Ontario court as giving them jurisdiction to hear the matter, subject to the court’s
discretion to determine not to hear the matter on the basis that Ontario is forum non
conveniens.
	 
	12.	 	The laws of Ontario permit an action to be brought in a court of competent jurisdiction in
Ontario on a final, conclusive and subsisting foreign judgment in personam for a sum certain,
which is not impeachable as void or voidable under the internal laws of the foreign
jurisdiction, provided that:

	 	(a)	 	the court rendering such judgment had jurisdiction over the judgment debtor,
as recognized by the courts of Ontario, and such judgment debtor

3

 

	 	 	 	was duly served with the process of the foreign court or appeared to such process;
	 
	 	(b)	 	such judgment was not obtained by fraud or in a manner contrary to natural
justice;
	 
	 	(c)	 	the enforcement of such judgment:

	 	(i)	 	does not constitute, directly or indirectly, the enforcement
of foreign revenue, expropriatory, penal or similar laws; and
	 
	 	(ii)	 	would not be inconsistent with any important public policy of
Ontario.

This opinion is subject to the following qualifications:

	 	(a)	 	the enforceability of the Sierra Acknowledgment is subject to bankruptcy,
insolvency, reorganization, arrangement, winding-up, moratorium and other similar laws
of general application affecting the enforcement of creditors’ rights generally;
	 
	 	(b)	 	the enforceability of the Sierra Acknowledgment is subject to general
equitable principles, including the fact that the availability of equitable remedies,
such as injunctive relief and specific performance, is in the discretion of a court;
	 
	 	(c)	 	a court may require that Sierra be given a reasonable time to repay following
a demand for payment and prior to taking any action to enforce any right of repayment
or before exercising any of the rights and remedies expressed to be exercisable the
Sierra Pledge (as acknowledged and confirmed pursuant to the Sierra Acknowledgment);
	 
	 	(d)	 	we express no opinion as to any security interest created by the Sierra
Pledge (as acknowledged and confirmed pursuant to the Sierra Acknowledgment) with
respect to any property of the Corporation or Sierra that is transformed in such a way
that it is not identifiable or traceable or any proceeds of property of the
Corporation or Sierra that is not identifiable or traceable; and
	 
	 	(e)	 	a judgment of an Ontario court may be awarded in only Canadian currency.

This opinion is intended for the use of the persons to whom it is addressed, and only in connection
with the transactions described above and it is not to be relied upon by any other person or for
any other purpose nor quoted or made public in any way without our prior written consent save that
this opinion may be relied upon by Simpson Thacher & Bartlett LLP for the purposes of giving their
opinion and that copies of this opinion may be delivered to your professional advisers.

Yours truly,

4

 

	 	 	 
	 

	 	Level 36
	 

	 	Grosvenor Place
	 

	 	225 George Street
	 

	 	Sydney NSW 2000
	 
	 	 
	 

	 	legal.info@bdw.com.au
	 
	 	 
	 

	 	Telephone (02) 9258 6000
	BLAKE DAWSON WALDRON

	 	Int + 61 2 9258 6000
	 

	 	Fax (02) 9258 6999
	LAWYERS

	 	DX 355 Sydney
	 
	 	 
	 	 	 
	 

	 	Locked Bag N6
	 

	 	PO Grosvenor Place
	 

	 	Sydney NSW 2000
	 

	 	Australia
	 
	 	 
	 

	 	Partner
	 

	 	Richard Fawcett
	 

	 	Telephone +61 2 9258 6056
	 
	 	 
	 

	 	Contact
	JPMorgan Chase Bank, N.A.

	 	Keiran McPhail

Telephone +61 2 9258 6678
	(as agent for the Lenders, under the
Restated Credit Agreement)
	 	 
	270 Park Avenue

	 	Our reference
	NEW YORK, NEW YORK 10017

	 	RFF KWM 02 1388 0037
	 
	UNITED STATES OF AMERICA

	 	[•] 2007

Dear Sirs

Scotts Australia Pty Limited – Restated Credit Agreement

We have
acted as Australian legal advisers to Scotts Australia Pty Limited ABN 31 003 123 162 (Company) in relation to the document titled “ Amended and Restated Credit
Agreement” dated as of [•] 2007 among The Scotts Miracle-Gro Company, as Borrower, certain other
companies including the Company, as Subsidiary Borrowers, certain banks and financial
institutions, as Lenders, JPMorgan Chase Bank, N.A., as Administrative Agent (JPMCB) and others
(Restated Credit Agreement).

Terms defined in the Restated Credit Agreement have the same meanings in this opinion unless the
context otherwise requires.

	1.	 	Documents
	 
	 	 	We have examined and rely on:

	 	(a)	 	a copy of the certificate of incorporation and a copy of the constitution of
the Company;
	 
	 	(b)	 	an executed copy of the minutes of the meeting of the board of directors of
the Company held on [•] 2007;
	 
	 	(c)	 	an extract of the public records of the Company produced, at our request on
[•] 2007 by the Australian Securities and Investments Commission (ASIC) from
information it obtained from its national database (Search); and
	 
	 	(d)	 	an executed copy of the Restated Credit Agreement.

	 	 	and such other documents as we think necessary in order to give this opinion.

Sydney

Melbourne

Brisbane

Perth

Canberra

Port Moresby

Jakarta

SHANGHAI

 

 

			
	BLAKE DAWSON WALDRON
	 	[•] 2007
	 	 	 
	JPMorgan Chase Bank, N.A.
	 	Page 2

	2.	 	Scope
	 
	 	 	This opinion relates only to the laws of the state of New South Wales (Relevant
Jurisdiction) and the federal laws of the Commonwealth of Australia in force at 9.00 am
(Sydney time) on the date of this opinion (Relevant Laws). In expressing our opinion on
the validity, binding effect, legality and enforceability of the Restated Credit Agreement
under the Relevant Laws, we have assumed its validity, binding effect, legality and
enforceability under any other applicable laws.
	 
	 	 	This opinion is given on the basis that it will be construed in accordance with the
Relevant Laws.
	 
	3.	 	General assumptions
	 
	 	 	For the purpose of giving our opinion we have also assumed:

	 	(a)	 	the authenticity of all signatures, seals and dates, and of any stamp duty
endorsement or marking;
	 
	 	(b)	 	that if we have reviewed a copy of a document rather than an original, the
copy is a complete, genuine and accurate copy of the original;
	 
	 	(c)	 	the Restated Credit Agreement:

	 	(i)	 	is within the capacity and power of, and has been or will be
validly authorised, executed and delivered by, each party to it other than the
Company; and
	 
	 	(ii)	 	constitutes valid and binding obligations of each party to it
under all applicable laws (other than the Relevant Laws as they affect the
obligations of the Company);

	 	(d)	 	where any obligation under the Restated Credit Agreement is to be performed
in any jurisdiction other than the Relevant Jurisdiction, its performance will not be
illegal or unenforceable under the laws of that jurisdiction;
	 
	 	(e)	 	the Company entered into the Restated Credit Agreement in good faith and the
entry by the Company into the Restated Credit Agreement is in the best interests of,
and for the purpose of the business of, the Company;
	 
	 	(f)	 	that the Company was solvent immediately before, at the time of and
immediately after entering into the Restated Credit Agreement;
	 
	 	(g)	 	the Company has not entered into the Restated Credit Agreement as trustee of
any trust or settlement;
	 
	 	(h)	 	no transaction in connection with the Restated Credit Agreement constituted
an insolvent transaction or an unfair loan within the meaning of section 588FC
(insolvent transactions) or 588FD (unfair loans to a

 

 

			
	BLAKE DAWSON WALDRON
	 	[•] 2007
	 	 	 
	JPMorgan Chase Bank, N.A.
	 	Page 3

	 	 	 	company) respectively of the Corporations Act 2001 (Cth) (Corporations Act);
	 
	 	(i)	 	the meeting referred to in paragraph 1(b) was properly convened and:

	 	(i)	 	the resolutions described in the minutes referred to in
paragraph 1(b) were properly passed as valid decisions of the board of
directors of the Company and have not been subsequently revoked, cancelled or
varied;
	 
	 	(ii)	 	the directors of the Company have properly performed their
duties and all provisions relating to the declaration of interest and voting
were duly observed; and
	 
	 	(iii)	 	the minutes of the meeting referred to in paragraph 1(b)
constitutes a true and correct record of the matters contained therein,

	 	 	 	but there is nothing in the Search or on the face of the minutes referred to in
paragraph 1(b) that would lead us to believe otherwise, and, in any event, we note
that you may rely on the assumptions specified in section 129 of the Corporations
Act unless you knew or suspected that the assumptions were incorrect;
	 
	 	(j)	 	the Restated Credit Agreement has not been amended, released or discharged,
and no provision in the Restated Credit Agreement has been waived;
	 
	 	(k)	 	that the choice of governing law contained in the Restated Credit Agreement
is made bona fide and is not unconnected with the commercial realities of the
transactions contemplated by the Restated Credit Agreement;
	 
	 	(l)	 	the Company is a resident of Australia for the purposes of the Income Tax
Assessment Act 1936 (Cth);
	 
	 	(m)	 	each payment required to be made by the Company under the Restated Credit
Agreement will be made to an Eligible Australian Bank at the time the payment is made;
	 
	 	(n)	 	if a recipient of a payment from the Company is acting as agent for another
party, that other party is an Eligible Australian Bank at the time the payment is
made;
	 
	 	(o)	 	any payment by the Company is made to an entity that has provided its Tax
File Number and/or its Australian Business Number to the Company in circumstances such
that the Company is not obliged to make any withholding under Subdivision 12E of Part
2-5 of Schedule 1 of the Taxation Administration Act 1953 (Cth);
	 
	 	(p)	 	the Company making the payment has not received any notice from the
Commissioner of Taxation requiring it to pay any amount owing to

 

 

			
	BLAKE DAWSON WALDRON
	 	[•] 2007
	 	 	 
	JPMorgan Chase Bank, N.A.
	 	Page 4

	 	 	 	another party under
the Restated Credit Agreement to the Commissioner of Taxation;
	 
	 	(q)	 	no regulations have been made prior to or after the date of this letter under
Subdivision 12FB of Part 2-5 of Schedule 1 of the Taxation Administration Act 1953
(Cth) which require the Company to withhold any amount from any payment required to be
made under the Restated Credit Agreement; and
	 
	 	(r)	 	if a payment by the Company is made to an entity that is acting as an agent
for another party, both the entity and that other party has provided its Tax File
Number and/or its Australian Business Number to the Company in circumstances that the
Company is not obliged to make any withholding under Subdivision 12E of Part 2-5 of
Schedule 1 of the Taxation Administration Act 1953 (Cth).

	 	 	The making of each of the above assumptions indicates that we have assumed that for each
matter, the subject of each assumption is true, correct and complete in every particular.
That we have made an assumption in this opinion does not imply that we have made any
enquiry to verify any assumption or are not aware of any circumstance which might affect
the correctness of any assumption. No assumption specified above is limited by reference
to any other assumption.
	 
	4.	 	Qualifications
	 
	 	 	Our opinion is subject to the following qualifications:

	 	(a)	 	We have not made any independent investigations or searches other than the
Search. ASIC’s records may not be complete or up to date in that documents might not
be filed at the relevant offices immediately, might no longer be on file, might be
replaced, or might otherwise not appear on the file.
	 
	 	(b)	 	A statement that an obligation or document is “binding” or “enforceable”
means that the obligation or document is of a type that courts in the Relevant
Jurisdiction, in principle, will enforce. This does not mean that a court will give
effect to the obligation or document in all circumstances. For example:

	 	(i)	 	a court might decline to exercise jurisdiction over a
defendant if it considers that it is not the most appropriate court for the
trial of the action, or if the parties have agreed to submit disputes to the
courts of, or arbitration in, another place;
	 
	 	(ii)	 	a court may not enforce performance of an obligation in a
place if the performance of that obligation would be illegal by the laws of
that place;
	 
	 	(iii)	 	equitable remedies, such as injunctions and specific
performance, are discretionary and will normally not be ordered where damages
would be an adequate remedy;

 

 

			
	BLAKE DAWSON WALDRON
	 	[•] 2007
	 	 	 
	JPMorgan Chase Bank, N.A.
	 	Page 5

	 	(iv)	 	a court might not give effect to an indemnity for legal
costs;
	 
	 	(v)	 	enforcement may be limited by statutes of limitation or by
general law doctrines or statutory relief in relation to representations,
acts, omissions or inconsistent dealings of, by or affecting the parties;
	 
	 	(vi)	 	enforcement may be affected by laws concerning lapse of time,
moratorium, equities, liens, set offs, counterclaims, abatements, bankruptcy,
liquidation, insolvency, administration, receivership or reorganisation or by
other laws that affect creditors’ rights generally;
	 
	 	(vii)	 	a document may not be enforceable or admissible in evidence
unless any stamp duty that is payable on it has been paid; and
	 
	 	(viii)	 	the courts in the Relevant Jurisdiction may stay proceedings if there are
corresponding proceedings on foot in another jurisdiction.

	 	(c)	 	Where a party or person entitled to the benefit of the Restated Credit
Agreement is vested with a discretion or may determine a matter in its opinion, the
Relevant Laws may require that the discretion is exercised reasonably or that the
opinion is based upon reasonable grounds.
	 
	 	(d)	 	Any provision that states that a calculation, determination or certificate
will be conclusive and binding will not apply to a calculation, determination or
certificate which is fraudulent or manifestly inaccurate and may not prevent judicial
enquiry into the merits of any claim relating to such a calculation, determination or
certificate.
	 
	 	(e)	 	A provision that requires that an amendment or waiver be in writing may not
be effective.
	 
	 	(f)	 	Judgments have been entered in the courts of New South Wales for amounts
expressed in currencies other than Australian dollars. Nevertheless, as there has
been no judgment of the High Court of Australia on the point, the question whether a
judgment will be entered in the courts of the Relevant Jurisdiction for an amount
expressed in other than Australian dollars is not free from doubt.
	 
	 	(g)	 	Any provision of the Restated Credit Agreement that imposes an obligation on
a party to pay an increased rate of interest on sums that are overdue may not be
enforceable if construed by a court as being a penalty rather than a genuine
pre-estimate of the loss suffered under the circumstances.
	 
	 	(h)	 	A provision that allows an illegal, invalid or unenforceable provision to be
severed from a document may not be effective.
	 
	 	(i)	 	A court will not give effect to a choice of laws to govern the Restated
Credit Agreement or a submission to the jurisdiction of certain courts if

 

 

			
	BLAKE DAWSON WALDRON
	 	[•] 2007
	 	 	 
	JPMorgan Chase Bank, N.A.
	 	Page 6

	 	 	 	to do so
would be contrary to public policy in the place in which the court is situated.
	 
	 	(j)	 	To the extent that a provision of the Restated Credit Agreement may require a
corporation to procure another corporation to do or refrain from doing any act, if it
would be a breach of the duties of the directors of the second-mentioned corporation
to do or refrain from doing that act, or if it would be illegal or impossible for that
corporation to do or refrain from doing that act, such provision may not be
enforceable.
	 
	 	(k)	 	The specific approval of the Reserve Bank of Australia must be obtained in
connection with certain payments and transactions having a prescribed connection with
countries, entities and persons designated from time to time by the Reserve Bank of
Australia for the purposes of the Banking (Foreign Exchange) Regulations 1959 (Cth).
Regulations in Australia also prohibit payments, transactions and dealings with assets
having a prescribed connection with certain countries or named individuals or entities
associated with terrorism.
	 
	 	(l)	 	We express no opinion:

	 	(i)	 	on any provision that requires a person to do or not do
something that is not clearly identified in the provision, or on any
undertaking in the Restated Credit Agreement to comply with another document
or agreement;
	 
	 	(ii)	 	on the accuracy or relevance of any representation, warranty
or other statement made by any party to the Restated Credit Agreement except
to the extent that such representation, warranty or other statement is
expressly repeated in paragraph 5 of this opinion;
	 
	 	(iii)	 	in relation to the accuracy, completeness, suitability,
consistency, functioning or operation of any formula, function or financial
ratio in the Restated Credit Agreement;
	 
	 	(iv)	 	on whether goods and services tax is payable in connection
with the transactions contemplated by the Restated Credit Agreement; or
	 
	 	(v)	 	as to, nor have we taken into account, the implications of
any pending or foreshadowed legislative or regulatory proposal or amendment or
of any litigation, hearing or pending judgment in the Relevant Jurisdiction or
Australia including but not limited to any matter not yet decided on appeal.

	 	 	No qualification specified above is limited by reference to any other qualification.

 

 

			
	BLAKE DAWSON WALDRON
	 	[•] 2007
	 	 	 
	JPMorgan Chase Bank, N.A.
	 	Page 7

	5.	 	Opinion
	 
	 	 	Based upon and subject to the foregoing, we are of the opinion, as at today’s date, that:

	 	(a)	 	The Company is registered and validly existing under the Corporations Act.
	 
	 	(b)	 	The Company has the corporate power to enter into and perform its obligations
under the Restated Credit Agreement.
	 
	 	(c)	 	The Company has taken all necessary corporate action required of it to
authorise the execution, delivery and performance of the Restated Credit Agreement.
	 
	 	(d)	 	The execution and delivery of, and the performance by the Company of its
obligations under, the Restated Credit Agreement does not contravene any provision of:

	 	(i)	 	the Relevant Laws; or
	 
	 	(ii)	 	the Company’s constitution.

	 	(e)	 	The Restated Credit Agreement constitutes legal, valid and binding
obligations of the Company enforceable in accordance with its terms.
	 
	 	(f)	 	The payment obligations of the Company under the Restated Credit Agreement
rank at least pari passu with the claims of all its other unsecured and unsubordinated
creditors under the Relevant Laws save those whose claims are mandatorily preferred by
any insolvency, liquidation or other Relevant Laws that affect creditors’ rights
generally.
	 
	 	(g)	 	No consent from any Australian government authority is required to be
obtained by the Company in connection with the execution and delivery of, and the
performance of the Company’s obligations under, the Restated Credit Agreement, or the
validity or enforceability of the Restated Credit Agreement against the Company.
	 
	 	(h)	 	No ad valorem stamp duty is payable pursuant to the laws of the Relevant
Jurisdiction in connection with the execution, delivery, performance or enforcement of
the Restated Credit Agreement.
	 
	 	(i)	 	It is not necessary in the Relevant Jurisdiction to file, register or record
the Restated Credit Agreement with any Australian government agency (including but not
limited to ASIC).
	 
	 	(j)	 	Each payment to be made by the Company under the Restated Credit Agreement
may be made free and clear of Australian withholding tax.
	 
	 	(k)	 	The Company is not entitled to claim for itself or any of its assets or
revenues any right of general immunity or exemption on the grounds of sovereignty or
otherwise from suit, execution, attachment or other legal

 

 

			
	BLAKE DAWSON WALDRON
	 	[•] 2007
	 	 	 
	JPMorgan Chase Bank, N.A.
	 	Page 8

	 	 	 	process in respect of its
obligations under the Restated Credit Agreement in the Relevant Jurisdiction.
	 
	 	(l)	 	The choice of law of New York State as the proper law of the Restated Credit
Agreement would be upheld as a valid choice of law by the courts of the Relevant
Jurisdiction and will be given effect by the courts of the Relevant Jurisdiction.
	 
	 	(m)	 	It is not necessary that JPMCB or any Lender be licensed, qualified or
otherwise entitled to carry on business (including, in particular, banking business)
in the Relevant Jurisdiction by reason only of JPMCB’s execution, delivery,
performance or enforcement of the Restated Credit Agreement.
	 
	 	(n)	 	Neither JPMCB nor any of the Lenders will be deemed to be resident, domiciled
or carrying on business in the Relevant Jurisdiction by reason only of JPMCB’s
execution, delivery, performance or enforcement of the Restated Credit Agreement.
	 
	 	(o)	 	Until such date as may be prescribed or until regulations are made providing
that Part 2 of the Foreign Judgments Act 1991 (Cth) extends to the Supreme Court of
the State of New York (whichever first occurs), any judgment given by a superior court
of State of New York under the Restated Credit Agreement, will in the normal course
give rise to a cause of action in a court in the Relevant Jurisdiction which action
should in the normal course enable the person in whose favour the foreign judgment has
been rendered to obtain a fresh judgment in the courts of the Relevant Jurisdiction
without re-examination or re-litigation of any matter adjudicated therein assuming
that:

	 	(i)	 	the judgment is consistent with public policy in the Relevant
Jurisdiction;
	 
	 	(ii)	 	the judgment was not given or obtained by fraud or duress or
in a manner contrary to natural justice;
	 
	 	(iii)	 	the judgment is not directly or indirectly for the payment
of taxes or other charges of a like nature or of a fine or other penalty;
	 
	 	(iv)	 	the judgment is still enforceable in the foreign country
concerned and has not been wholly satisfied;
	 
	 	(v)	 	the judgment is final and conclusive between the parties
notwithstanding that it may be subject to an appeal or an appeal is pending;
	 
	 	(vi)	 	the judgment is for a fixed sum;
	 
	 	(vii)	 	the judgment was consistent with the jurisdiction of the
foreign court concerned under its domestic laws; and

 

 

			
	BLAKE DAWSON WALDRON
	 	[•] 2007
	 	 	 
	JPMorgan Chase Bank, N.A.
	 	Page 9

	 	(viii)	 	the judgment is the only relevant judgment, that is to say there is no
previous judgment in another court between the same parties covering the same
issues.

	6.	 	Benefit
	 
	 	 	The opinion is addressed to and is for the benefit solely of JPMCB and the Lenders to whom
it is addressed. It may not be relied upon by, nor may any copy of it or extract from it
be supplied to, any other person, nor is it to be quoted or referred to in any public
document or filed with any government agency or other person without our prior written
consent.

Yours faithfully

 

 

EXHIBIT I

FORM OF BORROWING CERTIFICATE

     Pursuant to the Amended and Restated Credit Agreement, dated as of February [___], 2007 (as
amended, supplemented, waived or otherwise modified from time to time, the “Credit
Agreement”), by and among The Scotts Miracle-Gro Company, an Ohio corporation (the
“Borrower”), the Subsidiary Borrowers (as defined in the Credit Agreement) from time to
time parties thereto, the several banks and other financial institutions from time to time parties
thereto (the “Lenders”), the Syndication Agent and the Documentation Agents named therein,
and JPMorgan Chase Bank, N.A. as agent for the Lenders thereunder (in such capacity, the
“Administrative Agent”), the undersigned Responsible Officer of The Scotts Miracle-Gro
Company hereby certifies as follows:

     1. The representations and warranties of The Scotts Miracle-Gro Company and each of its
Subsidiaries set forth in the Credit Agreement and each other Loan Document to which they are
parties delivered today or which are contained in any certificate, document or financial or other
statement furnished pursuant to or in connection with any of the foregoing are true and correct in
all material respects on and as of the date hereof unless stated to relate to a specific earlier
date;

     2. Immediately prior to and immediately after the making of the Extension of Credit requested
to be made on the date hereof, no Default or Event of Default shall have occurred and be continuing
under the Credit Agreement;

     3. There are no liquidation or dissolution proceedings pending or to my knowledge threatened
against the Borrower nor against any Subsidiary Borrower, nor has any other event occurred
affecting or threatening the corporate existence of the Borrower nor the existence of any of the
Subsidiary Borrowers;

     4. The Borrower is a corporation duly incorporated, validly existing and in good standing
under the laws of Ohio. Each Domestic Subsidiary Borrower is a corporation duly incorporated,
validly existing and in good standing under the laws of the state or political subdivision of the
United States under which each is incorporated. Each Foreign Subsidiary Borrower is a corporation
duly incorporated, validly existing and in good standing (or the equivalent thereof) under the laws
of the country of its incorporation; and

     5. [Name of Subsidiary Borrower] is a resident of [Name of Country] for taxation purposes.

 

 

     IN WITNESS WHEREOF, the undersigned have hereunto set our names and affixed the corporate
seal.

	 	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 

Name:
	 	 
	 

	 	 	 	Title:	 	 

     Date:                                          , 200_

 

 

EXHIBIT J

FORM OF NEW DOMESTIC SUBSIDIARY CERTIFICATE

DOMESTIC SUBSIDIARY CERTIFICATE

     Pursuant to subsection 6.11(b) of the Amended and Restated Credit Agreement, dated as of
February [___], 2007 (as amended, supplemented, waived or otherwise modified from time to time, the
“Credit Agreement”), by and among The Scotts Miracle-Gro Company, an Ohio corporation (the
“Borrower”), the Subsidiary Borrowers (as defined in the Credit Agreement) from time to
time parties thereto, the several banks and other financial institutions from time to time parties
thereto (the “Lenders”), the Syndication Agent and the Documentation Agents named therein,
and JPMorgan Chase Bank, N.A. as agent for the Lenders thereunder (in such capacity, the
“Administrative Agent”), the undersigned officers of the [INSERT NAME OF SUBSIDIARY] (the
“Subsidiary”) hereby certify as follows (terms defined in the Credit Agreement being used
herein with their defined meanings):

     1. The representations and warranties made by the Subsidiary in each of the Loan Documents to
which it is a party are true and correct in all material respects on and as of the date hereof as
if made on and as of the date hereof [and after giving effect to the Loans requested to be made
pursuant to the Credit Agreement] (unless stated to relate to a specific earlier date, in which
case, such representations and warranties shall be true and correct in all material respects as of
such earlier date);

     2. Immediately prior to and immediately after the making of the Loans requested to be made
pursuant to the Credit Agreement on the date hereof, no Default or Event of Default will have
occurred and will be continuing under the Credit Agreement or any other Loan Document; and

     3.                                          is the duly elected and qualified Secretary of the Subsidiary and the
signature set forth on the signature line for such officer below is such officer’s true and genuine
signature, and the undersigned Secretary of the Subsidiary hereby certifies as follows:

     (a) Attached hereto as Exhibit A is a true and complete copy of
resolutions duly adopted by the Board of Directors of the Subsidiary on the
date thereof; such resolutions have not in any way been amended, modified,
revoked or rescinded and have been in full force and effect since their
adoption to and including the date hereof and are now in full force and
effect; such resolutions are the only corporate proceedings of the
Subsidiary now in force relating to or affecting the matters referred to
therein; attached hereto as Exhibit B is a true and complete copy of the

 

 

By-laws of the Subsidiary as in effect on the date hereof; and attached
hereto as Exhibit C is a true and complete copy of the Certificate of
Incorporation of the Subsidiary as in effect on the date hereof;

     (b) The following persons are now duly elected and qualified officers of the
Subsidiary, holding the offices indicated next to their respective names below, and
the signatures appearing opposite their respective names below are the true and
genuine signatures of such officers, and each of such officers is duly authorized to
execute and deliver on behalf of the Subsidiary the Credit Documents to which the
Subsidiary is or shall be a party and any certificate or other document to be
delivered by the Subsidiary pursuant to the Credit Documents:

	 	 	 	 	 	 	 	 	 
	Name	 	 	 	Office	 	 	 	Signature
	 
	 

	 	 	 	Vice President	 	 	 	 
	 

	 	 
	 	 	 	 
	 	 

	 

	 	 	 	Secretary	 	 	 	 
	 

	 	 
	 	 	 	 
	 	 

     IN WITNESS WHEREOF, the undersigned have executed this Certificate on the date set forth
below.

	 	 	 	 	 	 	 	 	 	 	 
	[INSERT NAME OF SUBSIDIARY]	 	 	 	[INSERT NAME OF SUBSIDIARY]	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	By:

	 	 	 	 	 	By:	 	 	 	 
	 

	 	 

Name:
	 	 
	 	 	 	 

Name:
	 	 
	 

	 	Title: Vice President
	 	 	 	 	 	Title: Secretary	 	 

                                                             , 200_

 

 

Exhibit A

to the

Domestic Subsidiary Certificate

Board of Directors Resolutions

 

 

Exhibit B

to the

Domestic Subsidiary Certificate

By-Laws

 

 

Exhibit C

to the

Domestic Subsidiary Certificate

Certificate of Incorporation

 

 

EXHIBIT K

FORM OF JOINDER AGREEMENT

     JOINDER AGREEMENT, dated as of                      ___,                     , made by each of the signatories hereto (the
“Subsidiary Borrowers”), in favor of JPMorgan Chase Bank, N.A., as Administrative Agent (in
such capacity, the “Administrative Agent”) for the banks and other financial institutions
(the “Lenders”) from time to time parties to the Amended and Restated Credit Agreement,
dated as of February [___], 2007 (as amended, supplemented or otherwise modified from time to time,
the “Credit Agreement”), among The Scotts Miracle-Gro Company, an Ohio corporation (the
“Borrower”), the Subsidiary Borrowers, (as defined in the Credit Agreement) from time to
time parties to the Credit Agreement, the Syndication Agent and the Documentation Agents named
therein and the Administrative Agent.

W I T N E S S E T H:

     WHEREAS, the parties to this Joinder Agreement wish to add Subsidiary Borrowers to the Credit
Agreement in the manner hereinafter set forth; and

     WHEREAS, this Joinder Agreement is entered into pursuant to subsection 10.1(b)(i) of the
Credit Agreement;

     NOW, THEREFORE, in consideration of the premises, the parties hereto hereby agree as follows:

     1. Each of the undersigned Subsidiaries of Scotts, hereby acknowledges that it has received
and reviewed a copy of the Credit Agreement, and acknowledges and
agrees to: join the Credit Agreement as a Subsidiary Borrower, as indicated with its signature below; be bound
by all covenants, agreements and acknowledgments attributable to a Subsidiary Borrower in the
Credit Agreement; and perform all obligations and duties required of it by the Credit Agreement.

     2. Each of the undersigned Subsidiaries of Scotts hereby represents and warrants that the
representations and warranties with respect to it contained in Section 4 of the Credit Agreement
and each of the other Loan Documents to which such Subsidiary of Scotts is a party or which are
contained in any certificate furnished by or on behalf of such Subsidiary of Scotts are true and
correct on the date hereof.

     3. The address and jurisdiction of incorporation of each of the undersigned Subsidiaries of
Scotts is set forth in Annex I to this Joinder Agreement.

 

 

2

     4. THIS JOINDER AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE
WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO THE PRINCIPLES OF CONFLICTS OF LAWS
THEREOF.

 

 3

     IN WITNESS WHEREOF, each of the undersigned has caused this Joinder Agreement to be duly
executed and delivered in [New York, New York] by its proper and duly authorized officer as of the
date set forth below.

	 	 	 	 	 	 	 
	 	 	[NAME OF SUBSIDIARY],	 	 
	 	 	as a Subsidiary Borrower	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 

Name:
	 	 
	 

	 	 	 	Title:	 	 
	 
	 	 	 	 	 	 
	 	 	[NAME OF SUBSIDIARY],	 	 
	 	 	as a Subsidiary Borrower	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 

Name:
	 	 
	 

	 	 	 	Title:	 	 
	 
	 	 	 	 	 	 
	 	 	THE SCOTTS MIRACLE-GRO COMPANY	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 

Name:
	 	 
	 

	 	 	 	Title:	 	 

ACKNOWLEDGED AND AGREED TO:

JPMORGAN CHASE BANK, N.A.,

as Administrative Agent

	 	 	 	 	 
	By:
	 	 	 	 
	 

	 	 

Name:
	 	 
	 

	 	Title:	 	 

 

ANNEX I

[Insert administrative information concerning Subsidiary Borrowers]EX-4.2

 

Exhibit 4.2

AMENDED AND RESTATED GUARANTEE AND COLLATERAL AGREEMENT

made by

THE SCOTTS MIRACLE-GRO COMPANY,

EACH DOMESTIC SUBSIDIARY BORROWER

and certain of their Domestic Subsidiaries

in favor of

JPMORGAN CHASE BANK, N.A.,

as Administrative Agent

Dated as of February 7, 2007

 

 

TABLE OF CONTENTS

	 	 	 	 	 	 	 
	 	 	 	 	Page	 
	 
	 	 	 	 	 	 
	SECTION
1.
	 	DEFINED TERMS	 	 	3	 
	 
	 	 	 	 	 	 
	1.1.
	 	Definitions	 	 	3	 
	1.2.
	 	Other Definitional Provisions	 	 	6	 
	 
	 	 	 	 	 	 
	SECTION 2.
	 	BORROWER GUARANTEE	 	 	6	 
	 
	 	 	 	 	 	 
	2.1.
	 	Borrower Guarantee	 	 	6	 
	2.2.
	 	No Subrogation	 	 	7	 
	2.3.
	 	Amendments, etc. with respect to the Subsidiary Borrower Obligations	 	 	7	 
	2.4.
	 	Guarantee Absolute and Unconditional	 	 	7	 
	2.5.
	 	Reinstatement	 	 	8	 
	2.6.
	 	Payments	 	 	8	 
	 
	 	 	 	 	 	 
	SECTION 3.
	 	DOMESTIC SUBSIDIARY GUARANTEE	 	 	8	 
	 
	 	 	 	 	 	 
	3.1.
	 	Domestic Subsidiary Guarantee	 	 	8	 
	3.2.
	 	Right of Contribution	 	 	9	 
	3.3.
	 	No Subrogation	 	 	9	 
	3.4.
	 	Amendments, etc. with respect to the Borrower Obligations and the	 	 	 	 
	 
	 	Borrower’s Guarantor Obligations	 	 	10	 
	3.5.
	 	Guarantees Absolute and Unconditional	 	 	10	 
	3.6.
	 	Reinstatement	 	 	11	 
	3.7.
	 	Payments	 	 	11	 
	 
	 	 	 	 	 	 
	SECTION 4.
	 	GRANT OF SECURITY INTEREST	 	 	11	 
	 
	 	 	 	 	 	 
	SECTION 5.
	 	REPRESENTATIONS AND WARRANTIES	 	 	12	 
	 
	 	 	 	 	 	 
	5.1.
	 	Title; No Other Liens	 	 	12	 
	5.2.
	 	Perfected First Priority Liens	 	 	12	 
	5.3.
	 	Jurisdiction of Organization	 	 	12	 
	5.4.
	 	Domestic Subsidiaries	 	 	13	 
	5.5.
	 	Pledged Stock	 	 	13	 
	5.6.
	 	Receivables	 	 	13	 
	 
	 	 	 	 	 	 
	SECTION 6.
	 	COVENANTS	 	 	13	 
	 
	 	 	 	 	 	 
	6.1.
	 	Delivery of Certificated Securities	 	 	13	 
	6.2.
	 	Maintenance of Insurance	 	 	13	 
	6.3.
	 	Payment of Obligations	 	 	14	 
	6.4.
	 	Maintenance of Perfected Security Interest; Further Documentation	 	 	14	 
	6.5.
	 	Notices	 	 	14	 
	6.6.
	 	Pledged Stock	 	 	14	 
	6.7.
	 	Receivables	 	 	15	 
	 
	 	 	 	 	 	 
	SECTION 7.
	 	REMEDIAL PROVISIONS	 	 	16	 

 

2

	 	 	 	 	 	 	 
	 	 	 	 	Page	 
	 
	 	 	 	 	 	 
	7.1.
	 	Certain Matters Relating to Receivables	 	 	16	 
	7.2.
	 	Communications with Obligors; Grantors Remain Liable	 	 	16	 
	7.3.
	 	Pledged Stock	 	 	17	 
	7.4.
	 	Proceeds to be Turned Over To Administrative Agent	 	 	18	 
	7.5.
	 	Application of Proceeds	 	 	18	 
	7.6.
	 	Code and Other Remedies	 	 	18	 
	7.7.
	 	Registration Rights	 	 	19	 
	7.8.
	 	Deficiency	 	 	20	 
	 
	 	 	 	 	 	 
	SECTION
8.
	 	THE ADMINISTRATIVE AGENT	 	 	20	 
	 
	 	 	 	 	 	 
	8.1.
	 	Administrative Agent’s Appointment as Attorney-in-Fact, etc	 	 	20	 
	8.2.
	 	Duty of Administrative Agent	 	 	21	 
	8.3.
	 	Execution of Financing Statements	 	 	22	 
	8.4.
	 	Authority of Administrative Agent	 	 	22	 
	 
	 	 	 	 	 	 
	SECTION
9.
	 	MISCELLANEOUS	 	 	22	 
	 
	 	 	 	 	 	 
	9.1.
	 	Amendments in Writing	 	 	22	 
	9.2.
	 	Notices	 	 	22	 
	9.3.
	 	No Waiver by Course of Conduct; Cumulative Remedies	 	 	22	 
	9.4.
	 	Enforcement Expenses; Indemnification	 	 	23	 
	9.5.
	 	Successors and Assigns	 	 	23	 
	9.6.
	 	Set-Off	 	 	23	 
	9.7.
	 	Counterparts	 	 	24	 
	9.8.
	 	Severability	 	 	24	 
	9.9.
	 	Section Headings	 	 	24	 
	9.10.
	 	Integration	 	 	24	 
	9.11.
	 	GOVERNING LAW	 	 	24	 
	9.12.
	 	Submission To Jurisdiction; Waivers	 	 	24	 
	9.13.
	 	Acknowledgments	 	 	24	 
	9.14.
	 	Additional Grantors	 	 	25	 
	9.15.
	 	Releases; Reinstatement	 	 	25	 
	9.16.
	 	Conflict of Laws	 	 	26	 
	9.17.
	 	WAIVER OF JURY TRIAL	 	 	26	 

	 	 	 
	SCHEDULES	 	 
	 
	Schedule 1

	 	Notice Addresses of Guarantors
	Schedule 2

	 	Description of Pledged Stock
	Schedule 3

	 	Jurisdiction of Incorporation
	Schedule 4

	 	Domestic Subsidiaries

 

 

3

     THIS AMENDED AND RESTATED GUARANTEE AND COLLATERAL AGREEMENT, dated as of February 7, 2007
made by each of the signatories hereto (together with any other entity that may become a party
hereto as provided herein, the “Grantors”), in favor of JPMORGAN CHASE BANK, N.A., as
Administrative Agent (in such capacity, the “Administrative Agent”) for the banks and other
financial institutions (the “Lenders”) from time to time parties to the Amended and
Restated Credit Agreement, dated as of February 7, 2007 (as amended, supplemented or otherwise
modified from time to time, the “Credit Agreement”), among THE SCOTTS MIRACLE-GRO COMPANY,
an Ohio corporation (the “Borrower”), the Subsidiary Borrowers, (as defined in the Credit
Agreement) from time to time parties to the Credit Agreement, the Syndication Agent and the
Documentation Agents named therein and the Administrative Agent.

W I
T N E S S E T H:

     WHEREAS, pursuant to the Credit Agreement, the Lenders have severally agreed to make
extensions of credit to the Borrower and the Subsidiary Borrowers upon the terms and subject to the
conditions set forth therein;

     WHEREAS, the Borrower and each Subsidiary Borrower is a member of an affiliated group of
companies that includes each other Grantor;

     WHEREAS, the proceeds of the extensions of credit under the Credit Agreement will be used in
part to enable the Borrower and each Subsidiary Borrower to make valuable transfers to one or more
of the other Grantors in connection with the operation of their respective businesses;

     WHEREAS, the Borrower, each Subsidiary Borrower and the other Grantors are engaged in related
businesses, and each Grantor will derive substantial direct and indirect benefit from the making of
the extensions of credit under the Credit Agreement; and

     WHEREAS, it is a condition precedent to the obligation of the Lenders to make their respective
extensions of credit to the Borrower and any Subsidiary Borrower under the Credit Agreement that
the Grantors shall have executed and delivered this Agreement to the Administrative Agent for the
ratable benefit of the Secured Parties;

     NOW, THEREFORE, in consideration of the premises and to induce the Administrative Agent and
the Lenders to enter into the Credit Agreement and to induce the Lenders to make their respective
extensions of credit to the Borrower and each Subsidiary Borrower thereunder, each Grantor hereby
agrees with the Administrative Agent, for the ratable benefit of the Secured Parties, as follows:

     SECTION 1. DEFINED TERMS

     1.1. Definitions(a) Unless otherwise defined herein, terms defined in the Credit
Agreement and used herein shall have the meanings given to them in the Credit Agreement and the
following terms are used herein as defined in the New York UCC: Accounts, Certificated Security,
Chattel Paper, Equipment, Inventory, Instruments and Supporting Obligations.

     (b) The following terms shall have the following meanings:

     “Agreement”: this Amended and Restated Guarantee and Collateral Agreement, as
the same may be amended, supplemented or otherwise modified from time to time.

 

4

     “Borrower Obligations”: the collective reference to the unpaid principal of and
interest on the Loans and Reimbursement Obligations and all other obligations and
liabilities of the Borrower (including, without limitation, interest accruing at the then
applicable rate provided in the Credit Agreement after the maturity of the Loans and
Reimbursement Obligations and interest accruing at the then applicable rate provided in the
Credit Agreement after the filing of any petition in bankruptcy, or the commencement of any
insolvency, reorganization or like proceeding, relating to the Borrower, whether or not a
claim for post-filing or post-petition interest is allowed in such proceeding) to the
Administrative Agent or any Lender (or, in the case of any Lender Hedging Agreement or
Lender Cash Management Agreement, any Affiliate of any Lender), whether direct or indirect,
absolute or contingent, due or to become due, or now existing or hereafter incurred, which
may arise under, out of, or in connection with, the Credit Agreement, this Agreement, the
other Loan Documents, any Letter of Credit, any Lender Hedging Agreement, any Lender Cash
Management Agreement or any other document made, delivered or given in connection with any
of the foregoing, in each case whether on account of principal, interest, reimbursement
obligations, fees, indemnities, costs, expenses or otherwise (including, without limitation,
all fees and disbursements of counsel to the Administrative Agent or to the Lenders that are
required to be paid by the Borrower pursuant to the terms of any of the foregoing
agreements).

     “Borrower’s Guarantor Obligations”: without duplicating any Borrower
Obligations, all obligations and liabilities of the Borrower which may arise under or in
connection with this Agreement (including, without limitation, Section 2) or any other Loan
Document to which the Borrower is a party, whether on account of guarantee obligations,
reimbursement obligations, fees, indemnities, costs, expenses or otherwise (including,
without limitation, all fees and disbursements of counsel to the Administrative Agent or to
the Lenders that are required to be paid by the Borrower pursuant to the terms of this
Agreement or any other Loan Document).

     “Capital Stock Security Period”: as defined in Section 9.15(d).

     “Collateral”: as defined in Section 4.

     “Foreign Subsidiary”: any Subsidiary organized under the laws of any
jurisdiction outside the United States of America, except for any such Subsidiary which is a
“check-the-box” entity under Regulation section 301.7701-3 of the Code.

     “Foreign Subsidiary Voting Stock”: the voting Capital Stock of any Foreign
Subsidiary.

     “Full Security Period”: any period from and after the Closing Date other than
any Unsecured Period or Capital Stock Security Period.

     “Guarantor Obligations”: with respect to any Guarantor, without duplicating
any Subsidiary Borrower Obligations, all obligations and liabilities of such Guarantor which
may arise under or in connection with this Agreement (including, without limitation, Section
3) or any other Loan Document to which such Guarantor is a party, in each case whether on
account of guarantee obligations, reimbursement obligations, fees, indemnities, costs,
expenses or otherwise (including, without limitation, all fees and disbursements of counsel
to the Administrative Agent or to the Lenders that are required to be paid by such Guarantor
pursuant to the terms of this Agreement or any other Loan Document).

 

5

     “Guarantors”: the collective reference to each Grantor other than the
Borrower. For the avoidance of doubt, notwithstanding any other provision of this
Agreement, the parties hereto expressly agree that no Foreign Subsidiary shall be a
Guarantor.

     “Issuers”: the collective reference to each issuer of any Pledged Stock.

     “Leverage Release Date”: as defined in Section 9.15(d).

     “New York UCC”: the Uniform Commercial Code as from time to time in effect in
the State of New York.

     “Obligations”: (i) in the case of the Borrower, the Borrower Obligations and
the Borrower’s Guarantor Obligations, (ii) in the case of each Guarantor which is also a
Domestic Subsidiary Borrower, its Subsidiary Borrower Obligations, and (iii) in the case of
each Guarantor (whether or not a Domestic Subsidiary Borrower), its Guarantor Obligations.

     “Pledged Stock”: the shares of Capital Stock listed on Schedule 2,
together with any other shares, stock certificates, options or rights of any nature
whatsoever in respect of the Capital Stock of any Subsidiary of the Borrower (to the extent
required to be pledged under Section 6.11 of the Credit Agreement) that may be issued or
granted to, or held by, any Grantor while this Agreement is in effect; provided that
in no event shall more than 65% of the total outstanding Foreign Subsidiary Voting Stock of
any Foreign Subsidiary be required to be pledged hereunder; provided further
that the shares of Capital Stock of Scotts Australia Pty Limited (the “Scotts Australia
Shares”) shall not constitute Pledged Stock at any time when the 2005 Equitable Share
Mortgage made by Scotts-Sierra Investments, Inc. in favor of JPMCB (or any such successor
Foreign Pledge Agreement entered into in respect of the Scotts Australia Shares for the
benefit of the Secured Parties) shall be in effect.

     “Proceeds”: all “proceeds” as such term is defined in Section 9-102(a)(64) of
the New York UCC and, in any event, shall include, without limitation, all dividends or
other income from the Pledged Stock, collections thereon or distributions or payments with
respect thereto.

     “Ratings Release Date”: as defined in Section 9.15(c).

     “Receivable”: shall mean any Account and any other right to payment for goods
sold or leased or for services rendered, whether or not such right is evidenced by an
Instrument or Chattel Paper and whether or not it has been earned by performance, other than
Sold Receivables.

     “Secured Parties”: the collective reference to the Administrative Agent, the
Lenders and any Affiliate of any Lender to which Borrower Obligations or Guarantor
Obligations, as applicable, are owed.

     “Securities Act”: the Securities Act of 1933, as amended.

     “Subsidiary Borrower Obligations”: with respect to each Subsidiary Borrower,
without duplicating any Guarantor Obligations, the collective reference to the unpaid
principal of and interest on the Loans and all other obligations and liabilities of such
Subsidiary Borrower (including, without limitation, interest accruing at the then applicable
rate provided in the Credit Agreement after the maturity of the Loans and interest accruing
at the then applicable rate provided in the Credit Agreement after the filing of any
petition in bankruptcy, or the commencement of any insolvency, reorganization or like
proceeding, relating to such Subsidiary

 

6

Borrower, whether or not a claim for post-filing or post-petition interest is allowed
in such proceeding) to the Administrative Agent or any Lender (or, in the case of any Lender
Hedge Agreement or Lender Cash Management Agreement, any Affiliate of any Lender), whether
direct or indirect, absolute or contingent, due or to become due, or now existing or
hereafter incurred, which may arise under, out of, or in connection with, the Credit
Agreement, this Agreement, the other Loan Documents, any Letter of Credit, any Lender
Hedging Agreement, any Lender Cash Management Agreement or any other document made,
delivered or given in connection with any of the foregoing, in each case whether on account
of principal, interest, reimbursement obligations, fees, indemnities, costs, expenses or
otherwise (including, without limitation, all fees and disbursements of counsel to the
Administrative Agent or to the Lenders that are required to be paid by such Subsidiary
Borrower pursuant to the terms of any of the foregoing agreements).

“Unsecured Period”: as defined in Section 9.15(c).

     1.2. Other Definitional Provisions(a) The words “hereof,” “herein”, “hereto” and
“hereunder” and words of similar import when used in this Agreement shall refer to this Agreement
as a whole and not to any particular provision of this Agreement, and Section and Schedule
references are to this Agreement unless otherwise specified.

     (a) The meanings given to terms defined herein shall be equally applicable to both the
singular and plural forms of such terms.

     (b) Where the context requires, terms relating to the Collateral or any part thereof, when
used in relation to a Grantor, shall refer to such Grantor’s Collateral or the relevant part
thereof.

     SECTION 2. BORROWER GUARANTEE

     2.1. Borrower Guarantee(a) The Borrower hereby, unconditionally and irrevocably,
guarantees to the Administrative Agent, for the ratable benefit of the Secured Parties and their
respective successors, indorsees, transferees and assigns, the prompt and complete payment and
performance by each Subsidiary Borrower when due (whether at the stated maturity, by acceleration
or otherwise) of its Subsidiary Borrower Obligations.

     (b) Anything herein or in any other Loan Document to the contrary notwithstanding, the maximum
liability of the Borrower hereunder and under the other Loan Documents shall in no event exceed the
amount which can be guaranteed by the Borrower under applicable federal and state laws relating to
the insolvency of debtors.

     (c) The guarantee contained in this Section 2 shall remain in full force and effect until all
the Subsidiary Borrower Obligations and the obligations of the Borrower under the guarantee
contained in this Section 2 shall have been satisfied by payment in full, no Letter of Credit shall
be outstanding and the Commitments and Loans shall be terminated, notwithstanding that from time to
time during the term of the Credit Agreement each Subsidiary Borrower may be free from any
Subsidiary Borrower Obligations.

     (d) No payment made by any Subsidiary Borrower, any of the other Guarantors, any other
guarantor or any other Person or received or collected by the Administrative Agent or any Lender
from any Subsidiary Borrower, any of the other Guarantors, any other guarantor or any other Person
by
virtue of any action or proceeding or any set-off or appropriation or application at any time
or from time to time in reduction of or in payment of the Subsidiary Borrower Obligations shall be
deemed to modify, reduce, release or otherwise affect the liability of the Borrower hereunder which
shall, notwithstanding

 

7

any such payment (other than any payment made by the Borrower in respect of
the Subsidiary Borrower Obligations or any payment received or collected from the Borrower in
respect of the Subsidiary Borrower Obligations), remain liable for the Subsidiary Borrower
Obligations up to the maximum liability of the Borrower hereunder until the Subsidiary Borrower
Obligations are paid in full, no Letter of Credit shall be outstanding and the Commitments are
terminated.

     2.2. No Subrogation. Notwithstanding any payment or payments made by the Borrower
hereunder, or any set-off or application of funds of the Borrower by the Administrative Agent or
any Lender, the Borrower shall not be entitled to be subrogated to any of the rights of the
Administrative Agent or any Lender against the Subsidiary Borrowers or against any collateral
security or guarantee or right of offset held by the Administrative Agent or any Lender for the
payment of the Subsidiary Borrower Obligations, nor shall the Borrower seek or be entitled to seek
any contribution or reimbursement from the Subsidiary Borrowers in respect of payments made by the
Borrower hereunder, until all amounts owing to the Administrative Agent and the Lenders by the
Subsidiary Borrowers on account of the Subsidiary Borrower Obligations are paid in full and the
Commitments and Loans are terminated. If any amount shall be paid to the Borrower on account of
such subrogation rights at any time when all of the Subsidiary Borrower Obligations shall not have
been paid in full, such amount shall be held by the Borrower in trust for the Administrative Agent
and the Lenders, segregated from other funds of the Borrower, and shall, forthwith upon receipt by
the Borrower, be turned over to the Administrative Agent in the exact form received by the Borrower
(duly indorsed by the Borrower to the Administrative Agent, if required), to be applied against the
Subsidiary Borrower Obligations, whether matured or unmatured, in such order as the Administrative
Agent may determine.

     2.3. Amendments, etc. with respect to the Subsidiary Borrower Obligations. The
Borrower shall remain obligated hereunder notwithstanding that, without any reservation of rights
against the Borrower and without notice to or further assent by the Borrower, any demand for
payment of any of the Subsidiary Borrower Obligations made by the Administrative Agent or any
Lender may be rescinded by the Administrative Agent or such Lender and any of the Subsidiary
Borrower Obligations continued, and the Subsidiary Borrower Obligations, or the liability of any
other Person upon or for any part thereof, or any collateral security or guarantee therefor or
right of offset with respect thereto, may, from time to time, in whole or in part, be renewed,
extended, amended, modified, accelerated, compromised, waived, surrendered or released by the
Administrative Agent or any Lender, and the Credit Agreement and the other Loan Documents and any
other documents executed and delivered in connection therewith may be amended, modified,
supplemented or terminated, in whole or in part, as the Administrative Agent (or the Required
Lenders or all Lenders, as the case may be) may deem advisable from time to time, and any
collateral security, guarantee or right of offset at any time held by the Administrative Agent or
any Lender for the payment of the Subsidiary Borrower Obligations may be sold, exchanged, waived,
surrendered or released. Neither the Administrative Agent nor any Lender shall have any obligation
to protect, secure, perfect or insure any Lien at any time held by it as security for the
Subsidiary Borrower Obligations or for the guarantee contained in this Section 2 or any property
subject thereto.

     2.4. Guarantee Absolute and Unconditional. The Borrower waives any and all notice of
the creation, renewal, extension or accrual of
any of the Subsidiary Borrower Obligations and notice of or proof of reliance by the Administrative
Agent or any Lender upon the guarantee contained in this Section 2 or acceptance of the guarantee
contained in this Section 2; the Subsidiary Borrower Obligations, and any of them, shall
conclusively be deemed to have been created, contracted or incurred, or renewed, extended, amended
or waived, in reliance upon the guarantee contained in this Section 2; and all dealings between the
Borrower and the Subsidiary Borrowers, on the one hand, and the Administrative Agent and the
Lenders, on the other hand, likewise shall be conclusively presumed to have been had or consummated
in reliance upon the guarantee contained in this Section 2. The Borrower waives diligence,
presentment, protest, demand for payment and notice of default or nonpayment to or upon the
Borrower

 

8

or the applicable Subsidiary Borrower with respect to the Subsidiary Borrower Obligations.
The Borrower understands and agrees that the guarantee contained in this Section 2 shall be
construed as a continuing, absolute and unconditional guarantee of payment without regard to (a)
the validity or enforceability of the Credit Agreement or any other Loan Document, any of the
Subsidiary Borrower Obligations or any other collateral security therefor or guarantee or right of
offset with respect thereto at any time or from time to time held by the Administrative Agent or
any Lender, (b) any defense, set-off or counterclaim (other than a defense of payment or
performance) which may at any time be available to or be asserted by any Subsidiary Borrower or any
other Person against the Administrative Agent or any Lender, or (c) any other circumstance
whatsoever (with or without notice to or knowledge of the Borrower or any Subsidiary Borrower)
which constitutes, or might be construed to constitute, an equitable or legal discharge of the
Subsidiary Borrowers for the Subsidiary Borrower Obligations, or of the Borrower under the
guarantee contained in this Section 2, in bankruptcy or in any other instance. When making any
demand hereunder or otherwise pursuing its rights and remedies hereunder against the Borrower, the
Administrative Agent or any Lender may, but shall be under no obligation to, make a similar demand
on or otherwise pursue such rights and remedies as it may have against the Subsidiary Borrowers or
any other Person or against any collateral security or guarantee for the Subsidiary Borrower
Obligations or any right of offset with respect thereto, and any failure by the Administrative
Agent or any Lender to make any such demand, to pursue such other rights or remedies or to collect
any payments from the Borrower, any Subsidiary Borrower, or any other Person or to realize upon any
such collateral security or guarantee or to exercise any such right of offset, or any release of
the Borrower, any Subsidiary Borrower or any other Person or any such collateral security,
guarantee or right of offset, shall not relieve the Borrower of any obligation or liability
hereunder, and shall not impair or affect the rights and remedies, whether express, implied or
available as a matter of law, of the Administrative Agent or any Lender against the Borrower. For
the purposes hereof, “demand” shall include the commencement and continuance of any legal
proceedings.

     2.5. Reinstatement. The guarantee contained in this Section 2 shall continue to be
effective, or be reinstated, as the case may be, if at any time payment, or any part thereof, of
any of the Subsidiary Borrower Obligations is rescinded or must otherwise be restored or returned
by the Administrative Agent or any Lender upon the insolvency, bankruptcy, dissolution, liquidation
or reorganization of the Borrower, any Subsidiary Borrower or any other Guarantor, or upon or as a
result of the appointment of a receiver, intervenor or conservator of, or trustee or similar
officer for, the Borrower, any Subsidiary Borrower or any other Guarantor or any substantial part
of its property, or otherwise, all as though such payments had not been made.

     2.6. Payments. The Borrower hereby guarantees that payments hereunder will be paid to
the Administrative Agent without set-off or counterclaim in Dollars or the applicable Optional
Currency at
the office of the Administrative Agent located at 270 Park Avenue, New York, New York 10017 or
at such other place and time specified by the Administrative Agent.

     SECTION 3. DOMESTIC SUBSIDIARY GUARANTEE

     3.1. Domestic Subsidiary Guarantee

     (a) Each of the Guarantors hereby, jointly and severally, unconditionally and irrevocably,
guarantees to the Administrative Agent, for the ratable benefit of the Secured Parties and their
respective successors, indorsees, transferees and assigns, the prompt and complete payment and
performance by the Borrower when due (whether at the stated maturity, by acceleration or otherwise)
of the Borrower Obligations and the Borrower’s Guarantor Obligations.

 

9

     (b) Anything herein or in any other Loan Document to the contrary notwithstanding, the maximum
liability of each Guarantor hereunder and under the other Loan Documents shall in no event exceed
the amount which can be guaranteed by such Guarantor under applicable federal and state laws
relating to the insolvency of debtors (after giving effect to the right of contribution established
in Section 3.2).

     (c) Each Guarantor agrees that the Borrower Obligations and the Borrower’s Guarantor
Obligations either solely or collectively, may at any time and from time to time exceed the amount
of the liability of such Guarantor hereunder without impairing the guarantee contained in this
Section 3 or affecting the rights and remedies of the Administrative Agent or any Lender hereunder.

     (d) The guarantees contained in this Section 3 shall remain in full force and effect until all
the Borrower Obligations and the Borrower’s Guarantor Obligations and the obligations of each
Guarantor under the guarantees contained in this Section 3 shall have been satisfied by payment in
full, no Letter of Credit shall be outstanding and the Commitments and Loans shall be terminated,
notwithstanding that from time to time during the term of the Credit Agreement, the Borrower may be
free from any Borrower Obligations and any Borrower’s Guarantor Obligations.

     (e) No payment made by the Borrower, any of the Guarantors, any other guarantor or any other
Person or received or collected by the Administrative Agent or any Lender from the Borrower, any of
the Guarantors, any other guarantor or any other Person by virtue of any action or proceeding or
any set-off or appropriation or application at any time or from time to time in reduction of or in
payment of the Borrower Obligations or the Borrower’s Guarantor Obligations shall be deemed to
modify, reduce, release or otherwise affect the liability of any Guarantor hereunder which shall,
notwithstanding any such payment (other than any payment made by such Guarantor in respect of the
Borrower Obligations or the Borrower’s Guarantor Obligations or any payment received or collected
from such Guarantor in respect of the Borrower Obligations or the Borrower’s Guarantor Obligations)
remain liable for the Borrower Obligations and the Borrower’s Guarantor Obligations up to the
maximum liability of such Guarantor hereunder until the Borrower Obligations and the Borrower’s
Guarantor Obligations are paid in full, no Letter of Credit shall be outstanding and the
Commitments and Loans are terminated.

     3.2. Right of Contribution. Each Guarantor hereby agrees that to the extent that a
Guarantor shall have paid more than its proportionate share of any payment made hereunder, such
Guarantor shall be entitled to seek and receive contribution from and against any other Guarantor
hereunder which has not paid its proportionate share of such payment. Each Guarantor’s right of
contribution shall be subject to the terms and
conditions of Section 3.3. The provisions of this Section 3.2 shall in no respect limit the
obligations and liabilities of any Guarantor to the Administrative Agent and the Lenders, and each
Guarantor shall remain liable to the Administrative Agent and the Lenders for the full amount
guaranteed by such Guarantor hereunder.

     3.3. No Subrogation. Notwithstanding any payment made by any Guarantor hereunder or
any set-off or application of funds of any Guarantor by the Administrative Agent or any Lender, no
Guarantor shall be entitled to be subrogated to any of the rights of the Administrative Agent or
any Lender against the Borrower or any other Guarantor or any collateral security or guarantee or
right of offset held by the Administrative Agent or any Lender for the payment of the Borrower
Obligations or the Borrower’s Guarantor Obligations nor shall any Guarantor seek or be entitled to
seek any contribution or reimbursement from the Borrower or any other Guarantor in respect of
payments made by such Guarantor hereunder, until all amounts owing to the Administrative Agent and
the Lenders by the Borrower on account of the Borrower Obligations and the Borrower’s Guarantor
Obligations are paid in full, no Letter of Credit shall be outstanding and the Commitments and
Loans are terminated. If any amount shall be

 

10

paid to any Guarantor on account of such subrogation
rights at any time when all of the Borrower Obligations and the Borrower’s Guarantor Obligations
shall not have been paid in full, such amount shall be held by such Guarantor in trust for the
Administrative Agent and the Lenders, segregated from other funds of such Guarantor, and shall,
forthwith upon receipt by such Guarantor, be turned over to the Administrative Agent in the exact
form received by such Guarantor (duly indorsed by such Guarantor to the Administrative Agent, if
required), to be applied against the Borrower Obligations and the Borrower’s Guarantor Obligations,
whether matured or unmatured, in such order as the Administrative Agent may determine.

     3.4. Amendments, etc. with respect to the Borrower Obligations and the Borrower’s
Guarantor Obligations. Each Guarantor shall remain obligated hereunder notwithstanding that,
without any reservation of rights against any Guarantor and without notice to or further assent by
any Guarantor, any demand for payment of any of the Borrower Obligations or the Borrower’s
Guarantor Obligations made by the Administrative Agent or any Lender may be rescinded by the
Administrative Agent or such Lender and any of the Borrower Obligations and the Borrower’s
Guarantor Obligations continued, and the Borrower Obligations and the Borrower’s Guarantor
Obligations or the liability of any other Person upon or for any part thereof, or any collateral
security or guarantee therefor or right of offset with respect thereto, may, from time to time, in
whole or in part, be renewed, extended, amended, modified, accelerated, compromised, waived,
surrendered or released by the Administrative Agent or any Lender, and the Credit Agreement and the
other Loan Documents and any other documents executed and delivered in connection therewith may be
amended, modified, supplemented or terminated, in whole or in part, as the Administrative Agent (or
the Required Lenders or all Lenders, as the case may be) may deem advisable from time to time, and
any collateral security, guarantee or right of offset at any time held by the Administrative Agent
or any Lender for the payment of the Borrower Obligations or the Borrower’s Guarantor Obligations
may be sold, exchanged, waived, surrendered or released. Neither the Administrative Agent nor any
Lender shall have any obligation to protect, secure, perfect or insure any Lien at any time held by
it as security for the Borrower Obligations or the Borrower’s Guarantor Obligations or for the
guarantee contained in this Section 3 or any property subject thereto.

     3.5. Guarantees Absolute and Unconditional. Each Guarantor waives any and all
notice of the creation, renewal, extension or accrual of
any of the Borrower Obligations or Borrower’s Guarantor Obligations and notice of or proof of
reliance by the Administrative Agent or any Lender upon any of the guarantees contained in this
Section 3 or acceptance of the guarantees contained in this Section 3; the Borrower Obligations and
the Borrower’s Guarantor Obligations and any of them, shall conclusively be deemed to have been
created, contracted or incurred, or renewed, extended, amended or waived, in reliance upon the
guarantee contained in this Section 3; and all dealings between the Borrower and any of the
Guarantors, on the one hand, and the Administrative Agent and the Lenders, on the other hand,
likewise shall be conclusively presumed to have been had or consummated in reliance upon the
guarantee contained in this Section 3. Each Guarantor waives diligence, presentment, protest,
demand for payment and notice of default or nonpayment to or upon the Borrower or any of the
Guarantors with respect to the Borrower Obligations and the Borrower’s Guarantor Obligations. Each
Guarantor understands and agrees that the guarantees contained in this Section 3 shall be construed
as a continuing, absolute and unconditional guarantee of payment without regard to (a) the validity
or enforceability of the Credit Agreement or any other Loan Document, any of the Borrower
Obligations or the Borrower’s Guarantor Obligations or any other collateral security therefor or
guarantee or right of offset with respect thereto at any time or from time to time held by the
Administrative Agent or any Lender, (b) any defense, set-off or counterclaim (other than a defense
of payment or performance) which may at any time be available to or be asserted by the Borrower or
any other Person against the Administrative Agent or any Lender, or (c) any other circumstance
whatsoever (with or without notice to or knowledge of the Borrower or such Guarantor) which
constitutes, or might be construed to constitute, an equitable or legal discharge of the Borrower
for the Borrower Obligations or the Borrower’s Guarantor Obligations, or of

 

11

such Guarantor under
the guarantee contained in this Section 3, in bankruptcy or in any other instance. When making any
demand hereunder or otherwise pursuing its rights and remedies hereunder against any Guarantor, the
Administrative Agent or any Lender may, but shall be under no obligation to, make a similar demand
on or otherwise pursue such rights and remedies as it may have against the Borrower, any other
Guarantor or any other Person or against any collateral security or guarantee for the Borrower
Obligations or the Borrower’s Guarantor Obligations or any right of offset with respect thereto,
and any failure by the Administrative Agent or any Lender to make any such demand, to pursue such
other rights or remedies or to collect any payments from the Borrower, any other Guarantor or any
other Person or to realize upon any such collateral security or guarantee or to exercise any such
right of offset, or any release of the Borrower, any other Guarantor or any other Person or any
such collateral security, guarantee or right of offset, shall not relieve any Guarantor of any
obligation or liability hereunder, and shall not impair or affect the rights and remedies, whether
express, implied or available as a matter of law, of the Administrative Agent or any Lender against
any Guarantor. For the purposes hereof “demand” shall include the commencement and continuance of
any legal proceedings.

     3.6. Reinstatement. The guarantees contained in this Section 3 shall continue to be
effective, or be reinstated, as the case may be, if at any time payment, or any part thereof, of
any of the Borrower Obligations or the Borrower’s Guarantor Obligations, is rescinded or must
otherwise be restored or returned by the Administrative Agent or any Lender upon the insolvency,
bankruptcy, dissolution, liquidation or reorganization of the Borrower or any Guarantor, or upon or
as a result of the appointment of a receiver, intervenor or conservator of, or trustee or similar
officer for, the Borrower or any Guarantor or any substantial part of its property, or otherwise,
all as though such payments had not been made.

     3.7. Payments. Each Guarantor hereby guarantees that payments hereunder will be paid
to the Administrative Agent without set-off or counterclaim in Dollars or the applicable Optional
Currency at
the office of the Administrative Agent located at 270 Park Avenue, New York, New York 10017 or
at such other place and time specified by the Administrative Agent.

     SECTION 4. GRANT OF SECURITY INTEREST

     Subject to Section 9.15, each Grantor hereby assigns and transfers to the Administrative
Agent, and hereby grants to the Administrative Agent, for the ratable benefit of the Secured
Parties, a security interest in, all of the following property now owned or at any time hereafter
acquired by such Grantor or in which such Grantor now has or at any time in the future may acquire
any right, title or interest (collectively, the “Collateral”), as collateral security for
the prompt and complete payment and performance when due (whether at the stated maturity, by
acceleration or otherwise) of such Grantor’s Obligations:

     (a) all Receivables;

     (b) all Equipment;

     (c) all Inventory;

     (d) all Pledged Stock;

     (e) all books and records pertaining to the Collateral; and

 

12

     (f) to the extent not otherwise included, all Proceeds, Supporting Obligations and products of
any and all of the foregoing and all collateral security and guarantees given by any Person with
respect to any of the foregoing.

     Notwithstanding the limitation on the inclusions of Foreign Subsidiary Voting Stock in the
definition of Pledged Stock, the remaining 35% of the outstanding Foreign Subsidiary Voting Stock
of any Foreign Subsidiary Borrower shall be pledged and subject to a grant of a security interest
therein subject to this Section 4; provided that such pledge and grant shall only secure
the obligations of such Foreign Subsidiary Borrower in its capacity as such under the Credit
Agreement; provided further, that notwithstanding any of the other provisions set
forth in this Section 4, this Agreement shall not constitute a grant of a security interest in any
property to the extent that such grant of a security interest is prohibited by any Requirements of
Law of a Governmental Authority, requires a consent not obtained of any Governmental Authority
pursuant to such Requirement of Law or is prohibited by, or constitutes a breach or default under
or results in the termination of or requires any consent not obtained under, any contract, license,
agreement, instrument or other document evidencing or giving rise to such property or, in the case
of any Pledged Stock, any applicable shareholder or similar agreement, except to the extent that
such Requirement of Law or the term in such contract, license, agreement, instrument or other
document or shareholder or similar agreement providing for such prohibition, breach, default or
termination or requiring such consent is ineffective under applicable law.

     SECTION 5. REPRESENTATIONS AND WARRANTIES

     To induce the Administrative Agent and the Lenders to enter into the Credit Agreement and to
induce the Lenders to make their respective extensions of credit to the Borrower and each
Subsidiary Borrower thereunder, each Grantor hereby represents and warrants to the Administrative
Agent and each Lender that other than during any Unsecured Period:

     5.1. Title; No Other Liens. Except for the security interest granted to the
Administrative Agent for the ratable benefit of the Secured Parties pursuant to this Agreement and
the other Liens permitted to exist on the Collateral by the Credit Agreement, such Grantor owns
each item of the Collateral free and clear of any and all Liens or claims of others. No financing
statement or other public notice with respect to all or any part of the Collateral is on file or of
record in any public office, except such as have been filed in favor of the Administrative Agent,
for the ratable benefit of the Secured Parties, pursuant to this Agreement or as are permitted by
the Credit Agreement.

     5.2. Perfected First Priority Liens. The security interests granted pursuant to this
Agreement will constitute valid perfected security interests in all of the Collateral in favor of
the Administrative Agent, for the ratable benefit of the Secured Parties, as collateral security
for such Grantor’s Obligations, enforceable in accordance with the terms hereof against all
creditors of such Grantor and any Persons purporting to purchase any Collateral from such Grantor
(other than Inventory sold by such Grantor in the ordinary course of business and except as
otherwise permitted by the Credit Agreement), to the extent that perfection or enforceability
against third parties is obtainable by completion of the filings and other actions set forth on
Schedule 3 or any similar filings or other actions in other jurisdictions in the United
States of America and are prior to all other Liens on the Collateral which have priority over the
Liens on the Collateral by operation of law and other Liens on the Collateral permitted by the
Credit Agreement.

     5.3. Jurisdiction of Organization. On the Closing Date, such Grantor’s jurisdiction
of organization and identification number from the jurisdiction of organization (if any) are set
forth on Schedule 3. Such Grantor has furnished to the Administrative Agent a certified charter,
certificate of

 

13

incorporation or other organizational document and good standing certificate as of a
date which is recent to the Closing Date.

     5.4. Domestic Subsidiaries. On the Closing Date, Schedule 4 sets forth a true and
complete list of the Domestic Subsidiaries.

     5.5. Pledged Stock. 

     (a) The shares of the Pledged Stock pledged by such Grantor hereunder constitute all the
issued and outstanding shares of all classes of the Capital Stock of each Issuer owned by such
Grantor or, in the case of Foreign Subsidiary Voting Stock, if less, 65% of the outstanding Foreign
Subsidiary Voting Stock of each relevant Issuer.

     (b) All the shares of the Pledged Stock have been duly and validly issued and are fully paid
and nonassessable.

     (c) Such Grantor is the record and beneficial owner of, and has good and marketable title to,
the Pledged Stock pledged by it hereunder, free of any and all Liens or options in favor of, or
claims of, any other Person, except the security interest created by this Agreement and except as
permitted under subsection 7.1 of the Credit Agreement.

     5.6. Receivables. During any Full Security Period,

     (a) None of the obligors on any Receivables is a Governmental Authority.

     (b) The amounts represented by such Grantor to the Lenders from time to time as owing to such
Grantor in respect of the Receivables will at such times be accurate in all material respects.

     SECTION 6. COVENANTS

     Each Grantor covenants and agrees with the Administrative Agent and the Lenders that, from and
after the date of this Agreement until the Obligations shall have been paid in full, no Letter of
Credit shall be outstanding and the Commitments and Loans shall have terminated, other than during
any Unsecured Period, 

     6.1. Delivery of Certificated Securities. If any amount payable under or in
connection with any of the Collateral shall be or become evidenced by any Certificated Security,
such Certificated Security shall be immediately delivered to the Administrative Agent, duly
indorsed (including by delivery of related stock powers) in a manner satisfactory to the
Administrative Agent, to be held as Collateral pursuant to this Agreement.

     6.2. Maintenance of Insurance. During any Full Security Period,

     (a) Such Grantor will maintain, with financially sound and reputable companies, insurance
policies (i) insuring the Inventory and Equipment against loss by fire, explosion, theft and such
other casualties as may be reasonably satisfactory to the Administrative Agent and (ii) to the
extent requested by the Administrative Agent, insuring such Grantor, the Administrative Agent and
the Lenders against liability for personal injury and property damage relating to such Inventory
and Equipment, such policies to be in such form and amounts and having such coverage as may be
reasonably satisfactory to the Administrative Agent and the Lenders.

 

14

     (b) All such insurance shall (i) provide that no cancellation, material reduction in amount or
material change in coverage thereof shall be effective until at least 30 days after receipt by the
Administrative Agent of written notice thereof, (ii) name the Administrative Agent as insured party
or loss payee, (iii) if reasonably requested by the Administrative Agent, include a breach of
warranty clause and (iv) be reasonably satisfactory in all other respects to the Administrative
Agent.

     (c) The Borrower shall deliver to the Administrative Agent and the Lenders a report of a
reputable insurance broker with respect to such insurance substantially concurrently with each
delivery of the Borrower’s audited annual financial statements and such supplemental reports with
respect thereto as the Administrative Agent may from time to time reasonably request.

     6.3. Payment of Obligations. Such Grantor will pay and discharge or otherwise satisfy
at or before maturity or before they become delinquent, as the case may be, all taxes, assessments
and governmental charges or levies imposed upon the Collateral or in respect of income or profits
therefrom, as well as all claims of any kind against or with respect to the Collateral, except that
no such charge need be paid if the amount or validity thereof is currently being contested in good
faith by appropriate proceedings, reserves in conformity with GAAP with respect thereto have been
provided on the books of such Grantor and such proceedings could
not reasonably be expected to result in the sale, forfeiture or loss of any material portion
of the Collateral or any interest therein.

     6.4. Maintenance of Perfected Security Interest; Further Documentation. Such Grantor
shall maintain the security interest created by this Agreement as a perfected security interest
having at least the priority described in Section 5.2 and shall defend such security interest
against the claims and demands of all Persons whomsoever.

     6.5. Notices. Such Grantor will advise the Administrative Agent and the Lenders
promptly, in reasonable detail, of:

     (a) any Lien (other than security interests created hereby or Liens permitted under the Credit
Agreement) on any of the Collateral which would adversely affect the ability of the Administrative
Agent to exercise any of its remedies hereunder; and

     (b) of the occurrence of any other event which could reasonably be expected to have a material
adverse effect on the aggregate value of the Collateral or on the security interests created
hereby.

     (c) At any time and from time to time, upon the written request of the Administrative Agent,
and at the sole expense of such Grantor, such Grantor will promptly and duly execute and deliver,
and have recorded, such further instruments and documents and take such further actions as the
Administrative Agent may reasonably request for the purpose of obtaining or preserving the full
benefits of this Agreement and of the rights and powers herein granted, including, without
limitation, (i) filing any financing or continuation statements under the Uniform Commercial Code
(or other similar laws) in effect in any jurisdiction with respect to the security interests
created hereby and (ii) in the case of Pledged Stock and any other relevant Collateral, taking any
actions necessary to enable the Administrative Agent to obtain “control” (within the meaning of the
applicable Uniform Commercial Code) with respect thereto.

     6.6. Pledged Stock

     (a) If such Grantor shall become entitled to receive or shall receive any stock certificate
(including, without limitation, any certificate representing a stock dividend or a distribution in
connection

 

15

with any reclassification, increase or reduction of capital or any certificate issued in
connection with any reorganization), option or rights in respect of the Capital Stock of any Issuer
which is a direct or indirect Domestic Subsidiary of such Grantor and which is Pledged Stock,
whether in addition to, in substitution of, as a conversion of, or in exchange for, any shares of
the Pledged Stock, or otherwise in respect thereof, such Grantor shall accept the same as the agent
of the Administrative Agent and the Lenders, hold the same in trust for the Administrative Agent
and the Lenders and deliver the same forthwith to the Administrative Agent in the exact form
received, duly indorsed (including by delivery of related stock or bond powers) by such Grantor to
the Administrative Agent, if required, together with an undated stock power covering such
certificate duly executed in blank by such Grantor to be held by the Administrative Agent, subject
to the terms hereof, as additional collateral security for such Grantor’s Obligations. Any sums
paid upon or in respect of the Collateral upon the liquidation or dissolution of any Issuer shall
be paid over to the Administrative Agent to be held by it hereunder as additional collateral
security for the
applicable Grantor’s Obligations, and in case any distribution of capital shall be made on or
in respect of the Collateral or any property shall be distributed upon or with respect to the
Collateral pursuant to the recapitalization or reclassification of the capital of any Issuer or
pursuant to the reorganization thereof, the property so distributed shall, unless otherwise subject
to a perfected security interest in favor of the Administrative Agent, be delivered to the
Administrative Agent to be held by it hereunder as additional collateral security for such
Obligations except to the extent permitted under Subsection 6.3. If any sums of money or property
so paid or distributed in respect of the Collateral shall be received by such Grantor, such Grantor
shall, until such money or property is paid or delivered to the Administrative Agent, hold such
money or property in trust for the Lenders, segregated from other funds of such Grantor, as
additional collateral security for the Obligations.

     Without the prior written consent of the Administrative Agent or unless permitted by the
Credit Agreement, such Grantor will not (i) vote to enable, or take any other action to permit, any
Issuer to issue any stock or other equity securities of any nature or to issue any other securities
convertible into or granting the right to purchase or exchange for any stock or other equity
securities of any nature of any Issuer, (ii) sell, assign, transfer, exchange, or otherwise dispose
of, or grant any option with respect to, the Collateral (except pursuant to a transaction
permitted by the Credit Agreement), (iii) create, incur or permit to exist any Lien or option in
favor of, or any claim of any Person with respect to, any of the Collateral, or any interest
therein, except for the security interests created by this Agreement or (iv) enter into any
agreement or undertaking restricting the right or ability of such Grantor or the Administrative
Agent to sell, assign or transfer any of the Collateral.

     In the case of each Grantor which is an Issuer, such Issuer agrees that (i) it will be bound
by the terms of this Agreement relating to the Pledged Stock issued by it and will comply with such
terms insofar as such terms are applicable to it, (ii) it will notify the Administrative Agent
promptly in writing of the occurrence of any of the events described in Section 6.4(a) with respect
to the Pledged Stock issued by it and (iii) the terms of Sections 7.3(c) and 7.7 shall apply to it,
mutatis mutandis, with respect to all actions that may be required of it pursuant
to Section 7.3(c) or 7.7 with respect to the Pledged Stock issued by it.

     6.7. Receivables. During any Full Security Period,

     (a) Other than in the ordinary course of business consistent with its past practice, such
Grantor will not (i) grant any extension of the time of payment of any Receivable, (ii) compromise
or settle any Receivable for less than the full amount thereof, (iii) release, wholly or partially,
any Person liable for the payment of any Receivable, (iv) allow any credit or discount whatsoever
on any Receivable or (v) amend, supplement or modify any Receivable in any manner that could
materially adversely affect the value thereof.

 

16

     (b) Such Grantor will deliver to the Administrative Agent a copy of each material demand,
notice or document received by it that questions or calls into doubt the validity or enforceability
of more than 5% of the aggregate amount of the then outstanding Receivables.

     (c) Anything contained in this Agreement to the contrary notwithstanding, the Grantors, or any
of them, shall have the right to enter into one or more Receivables Purchase Facilities, as
contemplated by the Credit Agreement, and the Administrative Agent shall execute any and all
documents reasonably necessary to release its security interest in the Receivables which become
Sold Receivables upon the consummation of such Receivables Purchase Facility(ies).

     SECTION 7. REMEDIAL PROVISIONS

     7.1. Certain Matters Relating to Receivables. During any Full Security Period,

     (a) The Administrative Agent shall have the right after the occurrence and during the
continuance of an Event of Default to make test verifications of the Receivables in any manner and
through any medium that it reasonably considers advisable, and each Grantor shall furnish all such
assistance and information as the Administrative Agent may require in connection with such test
verifications. At any time and from time to time, after the occurrence and during the continuance
of an Event of Default, upon the Administrative Agent’s request and at the expense of the relevant
Grantor, such Grantor shall cause independent public accountants or others satisfactory to the
Administrative Agent to furnish to the Administrative Agent reports showing reconciliations, aging
and test verifications of, and trial balances for, the Receivables.

     (b) The Administrative Agent hereby authorizes each Grantor to collect such Grantor’s
Receivables, and the Administrative Agent may curtail or terminate said authority at any time after
the occurrence and during the continuance of an Event of Default. If required by the
Administrative Agent at any time after the occurrence and during the continuance of an Event of
Default, any payments of Receivables, when collected by any Grantor, (i) shall be forthwith (and,
in any event, within two Business Days) deposited by such Grantor in the exact form received, duly
indorsed by such Grantor to the Administrative Agent if required, in a Collateral Account
maintained under the sole dominion and control of the Administrative Agent, subject to withdrawal
by the Administrative Agent for the account of the Lenders only as provided in Section 7.5, and
(ii) until so turned over, shall be held by such Grantor in trust for the Administrative Agent and
the Lenders, segregated from other funds of such Grantor. Each such deposit of Proceeds of
Receivables shall be accompanied by a report identifying in reasonable detail the nature and source
of the payments included in the deposit.

     (c) At the Administrative Agent’s request, after the occurrence and during the continuance of
an Event of Default, each Grantor shall deliver to the Administrative Agent all original and other
documents evidencing, and relating to, the agreements and transactions which gave rise to the
Receivables, including, without limitation, all original orders, invoices and shipping receipts.

     7.2. Communications with Obligors; Grantors Remain Liable. During any Full Security
Period,

     (a) The Administrative Agent in its own name or in the name of others may at any time after
the occurrence and during the continuance of an Event of Default communicate with obligors under
the Receivables to verify with them to the Administrative Agent’s satisfaction the existence,
amount and terms of any Receivables.

 

17

     (b) Upon the written request of the Administrative Agent at any time after the occurrence and
during the continuance of an Event of Default, each Grantor shall notify obligors on its
Receivables that the Receivables have been assigned to the Administrative Agent for the ratable
benefit of the Secured Parties and that payments in respect thereof shall be made directly to the
Administrative Agent.

     (c) Anything herein to the contrary notwithstanding, each Grantor shall remain liable under
each of its Receivables to observe and perform all the conditions and obligations to be observed
and performed by it thereunder, all in accordance with the terms of any agreement giving rise
thereto. Neither the Administrative Agent nor any Lender shall have any obligation or liability
under any Receivable (or any agreement giving rise thereto) by reason of or arising out of this
Agreement or the receipt by the Administrative Agent or any Lender of any payment relating thereto,
nor shall the Administrative Agent or any Lender be obligated in any manner to perform any of the
obligations of any Grantor under or pursuant to any Receivable (or any agreement giving rise
thereto), to make any payment, to make any inquiry as to the nature or the sufficiency of any
payment received by it or as to the sufficiency of any performance by any party thereunder, to
present or file any claim, to take any action to enforce any performance or to collect the payment
of any amounts which may have been assigned to it or to which it may be entitled at any time or
times.

     7.3. Pledged Stock

     (a) Unless an Event of Default shall have occurred and be continuing and the Administrative
Agent shall have given notice to the relevant Grantor of the Administrative Agent’s intent to
exercise its corresponding rights pursuant to Section 7.3(b), each Grantor shall be permitted to
receive all cash dividends paid in respect of the Pledged Stock, in each case paid in the normal
course of business of the relevant Issuer and consistent with past practice, to the extent
permitted in the Credit Agreement, to pay and declare dividends to the extent permitted by the
Credit Agreement and to exercise all voting and corporate rights with respect to the Pledged Stock;
provided, however, that no vote shall be cast or corporate right exercised or other
action taken which, in the Administrative Agent’s reasonable judgment, would impair the Collateral
or which would be inconsistent with or result in any violation of any provision of the Credit
Agreement, this Agreement or any other Loan Document.

     (b) If an Event of Default shall occur and be continuing and the Administrative Agent shall
give written notice of its intent to exercise such rights to the relevant Grantor or Grantors, (i)
the Administrative Agent shall have the right to receive any and all cash dividends, payments or
other Proceeds paid in respect of the Pledged Stock and make application thereof to the Obligations
in such order as the Administrative Agent may determine, and (ii) any or all of the Pledged Stock
shall be registered in the name of the Administrative Agent or its nominee, and the Administrative
Agent or its nominee may thereafter exercise (x) all voting, corporate and other rights pertaining
to such Pledged Stock at any meeting of shareholders of the relevant Issuer or Issuers or otherwise
and (y) any and all rights of conversion, exchange and subscription and any other rights,
privileges or options pertaining to such Pledged Stock as if it were the absolute owner thereof
(including, without limitation, the right to exchange at its discretion any and all of the Pledged
Stock upon the merger, consolidation, reorganization, recapitalization or other fundamental change
in the corporate structure of any Issuer, or upon the exercise by any Grantor or the Administrative
Agent of any right, privilege or option pertaining to such Pledged Stock, and in connection
therewith, the right to deposit and deliver any and all of the Pledged Stock with any committee,
depositary, transfer agent, registrar or other designated agency upon such terms and conditions as
the Administrative Agent may determine), all without liability except to account for property
actually received by it, but the Administrative Agent shall have no duty to any Grantor to exercise
any such right, privilege or option and shall not be responsible for any failure to do so or delay
in so doing.

 

18

     (c) Each Grantor hereby authorizes and instructs each Issuer of any Pledged Stock pledged by
such Grantor hereunder to (i) comply with any instruction received by it from the Administrative
Agent in writing that (x) states that an Event of Default has occurred and is continuing and (y) is
otherwise in accordance with the terms of this Agreement, without any other or further instructions
from such Grantor, and each Grantor agrees that each Issuer shall be fully protected in so
complying, and
(ii) unless otherwise expressly permitted hereby, pay any dividends or other payments with
respect to the Pledged Stock directly to the Administrative Agent.

     7.4. Proceeds to be Turned Over To Administrative Agent. If an Event of Default
shall occur and be continuing, all Proceeds received by any Grantor consisting of cash, checks and
other near-cash items shall be held by such Grantor in trust for the Administrative Agent and the
Lenders, segregated from other funds of such Grantor, and shall, forthwith upon receipt by such
Grantor, be turned over to the Administrative Agent in the exact form received by such Grantor
(duly indorsed by such Grantor to the Administrative Agent, if required). All Proceeds received by
the Administrative Agent hereunder shall be held by the Administrative Agent in a Collateral
Account maintained under its sole dominion and control. All Proceeds while held by the
Administrative Agent in a Collateral Account (or by such Grantor in trust for the Administrative
Agent and the Lenders) shall continue to be held as collateral security for all the Obligations and
shall not constitute payment thereof until applied as provided in Section 7.7.

     7.5. Application of Proceeds. At such intervals as may be agreed upon by the Borrower
and the Administrative Agent, or, if an Event of Default shall have occurred and be continuing, at
any time at the Administrative Agent’s election, the Administrative Agent may apply all or any part
of Proceeds constituting Collateral, whether or not held in any Collateral Account, and any
proceeds of the guarantee set forth in Section 2, in payment of the Obligations in the following
order:

     First, to pay incurred and unpaid fees and expenses of the Administrative Agent under the Loan
Documents;

     Second, to the Administrative Agent, for application by it towards payment of amounts then due
and owing and remaining unpaid in respect of the Obligations, pro rata among the Secured Parties
according to the amounts of the Obligations then due and owing and remaining unpaid to the Lenders;

     Third, to the Administrative Agent, for application by it towards prepayment of the
Obligations, pro rata among the Secured Parties according to the amounts of the Obligations then
held by the Lenders; and

     Fourth, any balance remaining after the Obligations shall have been paid in full, no Letters
of Credit shall be outstanding and the Commitments shall have been terminated shall be paid over to
the Borrower or to whomsoever may be lawfully entitled to receive the same.

     7.6. Code and Other Remedies. If an Event of Default shall occur and be continuing,
the Administrative Agent, on behalf of the Lenders, may exercise, in addition to all other rights
and remedies granted to them in this Agreement and in any other instrument or agreement securing,
evidencing or relating to the Obligations, all rights and remedies of a secured party under the New
York UCC or any other applicable law. Without limiting the generality of the foregoing, the
Administrative Agent, without demand of performance or other demand, presentment, protest,
advertisement or notice of any kind (except any notice required by law referred to below) to or
upon any Grantor or any other Person (all and each of which demands, defenses, advertisements and
notices are hereby waived), may in such circumstances forthwith collect, receive, appropriate and
realize upon the Collateral, or any part thereof,

 

19

and/or may forthwith sell, lease,
assign, give option or options to purchase, or otherwise dispose of and deliver the Collateral
or any part thereof (or contract to do any of the foregoing), in one or more parcels at public or
private sale or sales, at any exchange, broker’s board or office of the Administrative Agent or any
Lender or elsewhere upon such terms and conditions as it may deem advisable and at such prices as
it may deem best, for cash or on credit or for future delivery without assumption of any credit
risk. The Administrative Agent or any Lender shall have the right upon any such public sale or
sales, and, to the extent permitted by law, upon any such private sale or sales, to purchase the
whole or any part of the Collateral so sold, free of any right or equity of redemption in any
Grantor, which right or equity is hereby waived and released. Each Grantor further agrees, at the
Administrative Agent’s request, to assemble the Collateral and make it available to the
Administrative Agent at places which the Administrative Agent shall reasonably select, whether at
such Grantor’s premises or elsewhere. The Administrative Agent shall apply the net proceeds of any
action taken by it pursuant to this Section 7.6, after deducting all reasonable costs and expenses
of every kind incurred in connection therewith or incidental to the care or safekeeping of any of
the Collateral or in any way relating to the Collateral or the rights of the Administrative Agent
and the Lenders hereunder, including, without limitation, reasonable attorneys’ fees and
disbursements, to the payment in whole or in part of the Obligations, in such order as the
Administrative Agent may elect, and only after such application and after the payment by the
Administrative Agent of any other amount required by any provision of law, including, without
limitation, Section 9-615(a)(3) of the New York UCC, need the Administrative Agent account for the
surplus, if any, to any Grantor. To the extent permitted by applicable law, each Grantor waives
all claims, damages and demands it may acquire against the Administrative Agent or any Lender
arising out of the exercise by them of any rights hereunder. If any notice of a proposed sale or
other disposition of Collateral shall be required by law, such notice shall be deemed reasonable
and proper if given at least 10 days before such sale or other disposition.

     7.7. Registration Rights

     (a) If the Administrative Agent shall determine to exercise its right to sell any or all of
the Pledged Stock pursuant to Section 7.6, and if in the opinion of the Administrative Agent it is
necessary or advisable to have the Pledged Stock, or that portion thereof to be sold, registered
under the provisions of the Securities Act, the relevant Grantor will cause the Issuer thereof to
(i) execute and deliver, and cause the directors and officers of such Issuer to execute and
deliver, all such instruments and documents, and do or cause to be done all such other acts as may
be, in the opinion of the Administrative Agent, necessary or advisable to register the Pledged
Stock, or that portion thereof to be sold, under the provisions of the Securities Act, (ii) use its
best efforts to cause the registration statement relating thereto to become effective and to remain
effective for a period of one year from the date of the first public offering of the Pledged Stock,
or that portion thereof to be sold, and (iii) make all amendments thereto and/or to the related
prospectus which, in the opinion of the Administrative Agent, are necessary or advisable, all in
conformity with the requirements of the Securities Act and the rules and regulations of the
Securities and Exchange Commission applicable thereto. Each Grantor agrees to cause such Issuer to
comply with the provisions of the securities or “Blue Sky” laws of any and all jurisdictions which
the Administrative Agent shall designate and to make available to its security holders, as soon as
practicable, an earnings statement (which need not be audited) which will satisfy the provisions of
Section 11(a) of the Securities Act.

     (b) Each Grantor recognizes that the Administrative Agent may be unable to effect a public
sale of any or all the Pledged Stock, by reason of certain prohibitions contained in the Securities
Act and applicable state securities laws or otherwise, and may be compelled to resort to one or
more private sales thereof to a restricted group of purchasers which will be obliged to agree,
among other things, to acquire such securities for their own account, for investment and not with a
view to the distribution or resale thereof. Each Grantor acknowledges and agrees that any such
private sale may

 

20

result in prices and other terms less favorable than if such sale were a public
sale and, notwithstanding
such circumstances, agrees that any such private sale shall be deemed to have been made in a
commercially reasonable manner. The Administrative Agent shall be under no obligation to delay a
sale of any of the Pledged Stock for the period of time necessary to permit the Issuer thereof to
register such securities for public sale under the Securities Act, or under applicable state
securities laws, even if such Issuer would agree to do so.

     (c) Each Grantor agrees to use its best efforts to do or cause to be done all such other acts
as may be necessary to make such sale or sales of all or any portion of the Pledged Stock pursuant
to this Section 7.7 valid and binding and in compliance with any and all other applicable
Requirements of Law. Each Grantor further agrees that a breach of any of the covenants contained
in this Section 7.7 will cause irreparable injury to the Administrative Agent and the Lenders, that
the Administrative Agent and the Lenders have no adequate remedy at law in respect of such breach
and, as a consequence, that each and every covenant contained in this Section 7.7 shall be
specifically enforceable against such Grantor, and such Grantor hereby waives and agrees not to
assert any defenses against an action for specific performance of such covenants except for a
defense that no Event of Default has occurred under the Credit Agreement.

     7.8. Deficiency. Grantor shall remain liable for any deficiency if the proceeds of
any sale or other disposition of the Collateral are insufficient to pay its Obligations and the
fees and disbursements of any attorneys employed by the Administrative Agent or any Lender to
collect such deficiency.

     SECTION 8. THE ADMINISTRATIVE AGENT

     8.1. Administrative Agent’s Appointment as Attorney-in-Fact, etc

     (a) Each Grantor hereby irrevocably constitutes and appoints the Administrative Agent and any
officer or agent thereof, with full power of substitution, as its true and lawful attorney-in-fact
with full irrevocable power and authority in the place and stead of such Grantor and in the name of
such Grantor or in its own name, for the purpose of carrying out the terms of this Agreement, to
take any and all appropriate action and to execute any and all documents and instruments which may
be necessary or desirable to accomplish the purposes of this Agreement, and, without limiting the
generality of the foregoing, each Grantor hereby gives the Administrative Agent the power and
right, on behalf of such Grantor, without notice to or assent by such Grantor, to do any or all of
the following:

     (i) in the name of such Grantor or its own name, or otherwise, take possession of and
indorse and collect any checks, drafts, notes, acceptances or other instruments for the
payment of moneys due under any Receivable or with respect to any other Collateral and file
any claim or take any other action or proceeding in any court of law or equity or otherwise
deemed appropriate by the Administrative Agent for the purpose of collecting any and all
such moneys due under any Receivable or with respect to any other Collateral whenever
payable;

     (ii) pay or discharge taxes and Liens levied or placed on or threatened against the
Collateral, effect any repairs or any insurance called for by the terms of this Agreement
and pay all or any part of the premiums therefor and the costs thereof;

     (iii) execute, in connection with any sale provided for in Section 7.6 or 7.7, any
indorsements, assignments or other instruments of conveyance or transfer with respect to the
Collateral; and

 

21

     (iv) direct any party liable for any payment under any of the Collateral to make
payment of any and all moneys due or to become due thereunder directly to the Administrative
Agent or as the Administrative Agent shall direct; (1) ask or demand for, collect, and
receive payment of and receipt for, any and all moneys, claims and other amounts due or to
become due at any time in respect of or arising out of any Collateral; (2) sign and indorse
any invoices, freight or express bills, bills of lading, storage or warehouse receipts,
drafts against debtors, assignments, verifications, notices and other documents in
connection with any of the Collateral; (3) commence and prosecute any suits, actions or
proceedings at law or in equity in any court of competent jurisdiction to collect the
Collateral or any portion thereof and to enforce any other right in respect of any
Collateral; (4) defend any suit, action or proceeding brought against such Grantor with
respect to any Collateral; (5) settle, compromise or adjust any such suit, action or
proceeding and, in connection therewith, give such discharges or releases as the
Administrative Agent may deem appropriate; and (6) generally, sell, transfer, pledge and
make any agreement with respect to or otherwise deal with any of the Collateral as fully and
completely as though the Administrative Agent were the absolute owner thereof for all
purposes, and do, at the Administrative Agent’s option and such Grantor’s expense, at any
time, or from time to time, all acts and things which the Administrative Agent deems
necessary to protect, preserve or realize upon the Collateral and the Administrative Agent’s
and the Lenders’ security interests therein and to effect the intent of this Agreement, all
as fully and effectively as such Grantor might do.

     Anything in this Section 8.1(a) to the contrary notwithstanding, the Administrative Agent
agrees that it will not exercise any rights under the power of attorney provided for in this
Section 8.1(a) unless an Event of Default shall have occurred and be continuing.

     (b) If any Grantor fails to perform or comply with any of its agreements contained herein, the
Administrative Agent, at its option, but without any obligation so to do, may perform or comply, or
otherwise cause performance or compliance, with such agreement.

     (c) The expenses of the Administrative Agent incurred in connection with actions undertaken as
provided in this Section 8.1, together with interest thereon at a rate per annum equal to the
highest rate per annum at which interest would then be payable on any category of past due ABR
Loans under the Credit Agreement, from the date of payment by the Administrative Agent to the date
reimbursed by the relevant Grantor, shall be payable by such Grantor to the Administrative Agent on
demand.

     (d) Each Grantor hereby ratifies all that said attorneys shall lawfully do or cause to be done
by virtue hereof. All powers, authorizations and agencies contained in this Agreement are coupled
with an interest and are irrevocable until this Agreement is terminated and the security interests
created hereby are released.

     8.2. Duty of Administrative Agent. The Administrative Agent’s sole duty with respect
to the custody, safekeeping and physical preservation of the Collateral in its possession, under
Section 9-207 of the New York UCC or otherwise, shall be to deal with it in the same manner as the
Administrative Agent deals with similar property for its own account. Neither the Administrative
Agent, any Lender nor any of their respective officers, directors, employees or agents shall be
liable for failure to demand, collect or realize upon any of the Collateral or for any delay in
doing so or shall be under any obligation to sell or otherwise dispose of any Collateral upon the
request of any Grantor or any other Person or to take any other action whatsoever with regard to
the Collateral or any part thereof. The powers conferred on the Administrative Agent and the
Lenders hereunder are solely to protect the Administrative Agent’s and the Lenders’ interests in
the
Collateral and shall not impose any duty upon the Administrative Agent or any Lender to
exercise any such powers. The Administrative Agent and the

 

22

Lenders shall be accountable only for
amounts that they actually receive as a result of the exercise of such powers, and neither they nor
any of their officers, directors, employees or agents shall be responsible to any Grantor for any
act or failure to act hereunder, except for their own gross negligence or willful misconduct.

     8.3. Execution of Financing Statements. Pursuant to any applicable law, each Grantor
authorizes the Administrative Agent to file or record financing statements and other filing or
recording documents or instruments with respect to the Collateral without the signature of such
Grantor in such form and in such offices as the Administrative Agent determines appropriate to
perfect the security interests of the Administrative Agent under this Agreement. Each Grantor
hereby ratifies and authorizes the filing by the Administrative Agent of any financing statement
solely with respect to the Collateral made prior to the Closing Date. A photographic or other
reproduction of this Agreement shall be sufficient as a financing statement or other filing or
recording document or instrument for filing or recording in any jurisdiction.

     8.4. Authority of Administrative Agent. Each Grantor acknowledges that the rights and
responsibilities of the Administrative Agent under this Agreement with respect to any action taken
by the Administrative Agent or the exercise or non-exercise by the Administrative Agent of any
option, voting right, request, judgment or other right or remedy provided for herein or resulting
or arising out of this Agreement shall, as between the Administrative Agent and the Lenders, be
governed by the Credit Agreement and by such other agreements with respect thereto as may exist
from time to time among them, but, as between the Administrative Agent and the Grantors, the
Administrative Agent shall be conclusively presumed to be acting as agent for the Lenders with full
and valid authority so to act or refrain from acting, and no Grantor shall be under any obligation,
or entitlement, to make any inquiry respecting such authority.

     SECTION 9. MISCELLANEOUS

     9.1. Amendments in Writing. None of the terms or provisions of this Agreement may be
waived, amended, supplemented or otherwise modified except in accordance with subsection 10.1 of
the Credit Agreement.

     9.2. Notices. All notices, requests and demands to or upon the Administrative Agent
or any Grantor hereunder shall be effected in the manner provided for in subsection 10.2 of the
Credit Agreement; provided that any such notice, request or demand to or upon any Guarantor shall
be addressed to such Guarantor at its notice address set forth on Schedule 1.

     9.3. No Waiver by Course of Conduct; Cumulative Remedies. Neither the Administrative
Agent nor any Lender shall by any act (except by a written instrument pursuant to Section 9.1),
delay, indulgence, omission or otherwise be deemed to have waived any right or remedy hereunder or
to have acquiesced in any Default or Event of Default. No failure to exercise, nor any delay in
exercising, on the part of the Administrative Agent or any Lender, any right, power or privilege
hereunder shall operate as a waiver thereof. No single or partial exercise of any right,
power or privilege hereunder shall preclude any other or further exercise thereof or the
exercise of any other right, power or privilege. A waiver by the Administrative Agent or any
Lender of any right or remedy hereunder on any one occasion shall not be construed as a bar to any
right or remedy which the Administrative Agent or such Lender would otherwise have on any future
occasion. The rights and remedies herein provided are cumulative, may be exercised singly or
concurrently and are not exclusive of any other rights or remedies provided by law.

 

 

23

          9.4. Enforcement Expenses; Indemnification

          (a) Each Guarantor agrees to pay or reimburse each Lender and the Administrative Agent for all
its costs and expenses incurred in collecting against such Guarantor under the guarantees contained
in Section 2 or 3, as applicable, or otherwise enforcing or preserving any rights under this
Agreement and the other Loan Documents to which such Guarantor is a party, including, without
limitation, the reasonable fees and disbursements of counsel (including the allocated fees and
expenses of in-house counsel) to each Lender and of counsel to the Administrative Agent.

          (b) Each Guarantor agrees to pay, and to save the Administrative Agent and the Lenders
harmless from, any and all liabilities with respect to, or resulting from any delay in paying, any
and all stamp, excise, sales or other taxes which may be payable or determined to be payable with
respect to any of the Collateral or in connection with any of the transactions contemplated by this
Agreement.

          (c) Each Guarantor agrees to pay, and to save the Administrative Agent and the Lenders
harmless from, any and all liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements of any kind or nature whatsoever with respect to
the execution, delivery, enforcement, performance and administration of this Agreement to the
extent the Borrower would be required to do so pursuant to subsection 10.5 of the Credit Agreement.

          (d) The agreements in this Section 9.4 shall survive repayment of the Obligations and all
other amounts payable under the Credit Agreement and the other Loan Documents.

          9.5. Successors and Assigns. This Agreement shall be binding upon the successors and
assigns of each Grantor and shall inure to the benefit of the Administrative Agent and the Secured
Parties and their successors and assigns; provided that no Grantor may assign, transfer or delegate
any of its rights or obligations under this Agreement without the prior written consent of the
Administrative Agent.

          9.6. Set-Off. Each Grantor hereby irrevocably authorizes the Administrative Agent and
each Lender at any time and from time to time while an Event of Default shall have occurred and be
continuing, without notice to such Grantor or any other Grantor, any such notice being expressly
waived by each Grantor, to set-off and appropriate and apply any and all deposits (general or
special, time or demand, provisional or final), in any currency, and any other credits,
indebtedness or claims, in any currency, in each case whether direct or indirect, absolute or
contingent, matured or unmatured, at any time held or owing by the Administrative Agent or such
Lender to or for the credit or the account of such Grantor, or any part thereof in such amounts as
the Administrative Agent or such Lender may elect, against and on account of the obligations and
liabilities of such Grantor to the Administrative Agent or such Lender hereunder and claims of
every nature and description of the Administrative Agent or such Lender against
such Grantor, in any currency, whether arising hereunder, under the Credit Agreement, any
other Loan Document or otherwise, as the Administrative Agent or such Lender may elect, whether or
not the Administrative Agent or any Lender has made any demand for payment and although such
obligations, liabilities and claims may be contingent or unmatured. The Administrative Agent and
each Lender shall notify such Grantor promptly of any such set-off and the application made by the
Administrative Agent or such Lender of the proceeds thereof, provided that the failure to give such
notice shall not affect the validity of such set-off and application. The rights of the
Administrative Agent and each Lender under this Section 9.6 are in addition to other rights and
remedies (including, without limitation, other rights of set-off) which the Administrative Agent or
such Lender may have.

 

24

          9.7. Counterparts. This Agreement may be executed by one or more of the parties to
this Agreement on any number of separate counterparts (including by telecopy), and all of said
counterparts taken together shall be deemed to constitute one and the same instrument.

          9.8. Severability. Any provision of this Agreement which is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining provisions hereof, and any
such prohibition or unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.

          9.9. Section Headings. The Section headings used in this Agreement are for
convenience of reference only and are not to affect the construction hereof or be taken into
consideration in the interpretation hereof.

          9.10. Integration. This Agreement and the other Loan Documents represent the
agreement of the Grantors, the Administrative Agent and the Lenders with respect to the subject
matter hereof and thereof, and there are no promises, undertakings, representations or warranties
by the Administrative Agent or any Lender relative to subject matter hereof and thereof not
expressly set forth or referred to herein or in the other Loan Documents.

          9.11. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND
INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

          9.12. Submission To Jurisdiction; Waivers. Each Grantor hereby irrevocably and
unconditionally:

          (a) submits for itself and its property in any legal action or proceeding relating to this
Agreement and the other Loan Documents to which it is a party, or for recognition and enforcement
of any judgment in respect thereof, to the non-exclusive general jurisdiction of the Courts of the
State of New York, the courts of the United States of America for the Southern District of New
York, and appellate courts from any thereof;

          (b) consents that any such action or proceeding may be brought in such courts and waives any
objection that it may now or hereafter have to the venue of any such action or proceeding in any
such court or that such action or proceeding was brought in an inconvenient court and agrees not to
plead or claim the same;

          (c) agrees that service of process in any such action or proceeding may be effected by mailing
a copy thereof by registered or certified mail (or any substantially similar form of mail), postage
prepaid, to such Grantor at its address referred to in Section 9.2 or at such other address of
which the Administrative Agent shall have been notified pursuant thereto;

          (d) agrees that nothing herein shall affect the right to effect service of process in any
other manner permitted by law or shall limit the right to sue in any other jurisdiction; and

          (e) waives, to the maximum extent not prohibited by law, any right it may have to claim or
recover in any legal action or proceeding referred to in this Section any special, exemplary,
punitive or consequential damages.

          9.13. Acknowledgments. Each Grantor hereby acknowledges that:

 

25

          (a) it has been advised by counsel in the negotiation, execution and delivery of this
Agreement and the other Loan Documents to which it is a party;

          (b) neither the Administrative Agent nor any Lender has any fiduciary relationship with or
duty to any Grantor arising out of or in connection with this Agreement or any of the other Loan
Documents, and the relationship between the Grantors, on the one hand, and the Administrative Agent
and Lenders, on the other hand, in connection herewith or therewith is solely that of debtor and
creditor; and

          (c) no joint venture is created hereby or by the other Loan Documents or otherwise exists by
virtue of the transactions contemplated hereby among the Lenders or among the Grantors and the
Lenders.

          9.14. Additional Grantors. Each Domestic Subsidiary Borrower that is required to
become a party to this Agreement pursuant to subsection 10.1(b) of the Credit Agreement shall
become a Grantor for all purposes of this Agreement upon execution and delivery by such Domestic
Subsidiary Borrower of an Assumption Agreement in the form of Annex 1 hereto.

          9.15. Releases; Reinstatement.

          (a) At such time as the Loans, the Reimbursement Obligations and the other Obligations shall
have been paid in full, the Commitments have been terminated and no Letters of Credit shall be
outstanding, the Collateral shall be released from the Liens created hereby, and this Agreement and
all obligations (other than those expressly stated to survive such termination) of the
Administrative Agent and each Grantor hereunder shall terminate, all without delivery of any
instrument or performance of any act by any party, and all rights to the Collateral shall revert to
the Grantors. At the request and sole expense of any Grantor following any such termination, the
Administrative Agent shall deliver to such
Grantor any Collateral held by the Administrative Agent hereunder, and execute and deliver to
such Grantor such documents as such Grantor shall reasonably request to evidence such termination.

          (b) If any of the Collateral shall be sold, transferred or otherwise disposed of by any
Grantor in a transaction permitted by the Credit Agreement, then the Administrative Agent, at the
request and sole expense of such Grantor, shall execute and deliver to such Grantor all releases or
other documents reasonably necessary or desirable for the release of the Liens created hereby on
such Collateral. At the request and sole expense of the Borrower, a Subsidiary Guarantor shall be
released from its obligations hereunder in the event that all the Capital Stock of such Subsidiary
Guarantor shall be sold, transferred or otherwise disposed of in a transaction permitted by the
Credit Agreement; provided that the Borrower shall have delivered to the Administrative
Agent, at least ten Business Days prior to the date of the proposed release, a written request for
release identifying the relevant Subsidiary Guarantor and the terms of the sale or other
disposition in reasonable detail, including the price thereof and any expenses in connection
therewith, together with a certification by the Borrower stating that such transaction is in
compliance with the Credit Agreement and the other Loan Documents.

          (c) At such time as the Specified Ratings shall be in effect, the Borrower shall have the
right by written notice to the Administrative Agent to require all Collateral be released from any
security interest created hereby. On any such date (a “Ratings Release Date”), all rights
to the Collateral shall transfer and revert to the Borrower and the Guarantors (the period from and
after any such date (and prior to a reinstatement required pursuant to Section 9.15(e) or (f)), an
“Unsecured Period”). On any such Ratings Release Date, the Grantors shall be authorized
and the Administrative Agent hereby authorizes each Grantor, to prepare and record UCC termination
statements with respect to any financing statements recorded by the Administrative Agent hereunder.
At the request and sole expense of the Borrower

 

26

following a Ratings Release Date, the
Administrative Agent shall deliver to the Borrower any Collateral (including certificates
representing the Pledged Stock) held by the Administrative Agent hereunder, and execute and deliver
to the Borrower such documents as the Borrower shall reasonably request to evidence such
termination.

          (d) At such date as the Leverage Ratio shall have been equal to or less than 2.50 to 1.00 for
a period of four consecutive fiscal quarters, the Borrower shall have the right by written notice
to the Administrative Agent to require that all Collateral other than Pledged Stock be released
from any security interest created hereby. On any such date (a “Leverage Release Date”),
all rights to such Collateral shall transfer and revert to the Borrower and the Guarantors (the
period from an after any such date (and prior to a reinstatement required pursuant to Section
9.15(f)), a “Capital Stock Security Period”). On or after any such Leverage Release Date,
the Grantors shall be authorized and the Administrative Agent hereby authorizes each Grantor, to
prepare and record UCC amendments with respect to any financing statements recorded by the
Administrative Agent hereunder to reflect the release of all Collateral other than Pledged Stock.
At the request and sole expense of the Borrower following a Leverage Release Date, the
Administrative Agent shall deliver to the Borrower any Collateral (other than certificates
representing Pledged Stock) held by the Administrative Agent hereunder, and execute and deliver to
the Borrower such documents as the Borrower shall reasonably request to evidence such termination.

          (e) Notwithstanding clause (c) of this Section 9.15, in the event that the Specified Ratings
shall no longer be in effect as a result of a ratings downgrade by either S&P or Moody’s at any
time during an Unsecured Period, the Collateral shall be reinstated in full within sixty days of
such event, along with any necessary UCC filings, modifications to the Schedules hereto and such
other actions requested by the Administrative Agent as are reasonably necessary to grant a first
priority perfected security interest (subject to Liens otherwise permitted by this Agreement and
the Credit Agreement) in such Collateral; provided that if at such time the Borrower would
be permitted to seek a release of all
Collateral other than Pledged Stock in accordance with clause (d) of this Section 9.15, such
reinstatement requirement shall apply only to Pledged Stock.

          (f) Notwithstanding clause (d) of this Section 9.15, in the event that the Leverage Ratio as
at the end of any fiscal quarter of the Borrower shall be in excess of 2.50 to 1.00 at any time
during a Capital Stock Security Period and the Specified Ratings shall not then be in effect, the
Required Lenders may, upon written notice by the Administrative Agent to the Borrower, require that
all Collateral be reinstated in full within sixty days of such notice, along with any necessary UCC
filings, modifications to the Schedules hereto and such other actions as are reasonably necessary
to grant a first priority (subject to Liens permitted by this Agreement and the Credit Agreement)
perfected security interest in such Collateral.

          9.16. Conflict of Laws. Notwithstanding anything to the contrary herein, in the event
that any provision of any pledge, charge or foreign equivalent executed by any Foreign Subsidiary
and governed by the laws of the applicable foreign jurisdiction is inconsistent with any
corresponding provision in this Agreement, the provision in such pledge, charge or foreign
equivalent shall govern.

          9.17. WAIVER OF JURY TRIAL. EACH GRANTOR HEREBY IRREVOCABLY AND UNCONDITIONALLY
WAIVES TRIAL BY JURY IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER LOAN
DOCUMENT AND FOR ANY COUNTERCLAIM THEREIN.

[Remainder of page intentionally left blank]

 

     IN WITNESS WHEREOF, each of the undersigned has caused this Amended and Restated
Guarantee and Collateral Agreement to be duly executed and delivered as of the date first above
written.

	 	 	 	 	 
	 	 	JPMORGAN CHASE BANK, N.A.

	 

	 	By:
	 	/s/ Randolph Cates
	 

	 	 	 	 
	 

	 	 	 	Name: Randolph Cates
	 

	 	 	 	Title: Vice President

	 	 	THE SCOTTS MIRACLE-GRO COMPANY

	 

	 	By:
	 	/s/ David C. Evans
	 

	 	 	 	 
	 

	 	 	 	Name: David C. Evans
	 

	 	 	 	Title: Executive Vice President and Chief Financial Officer

	 	 	THE SCOTTS COMPANY LLC

	 

	 	By:
	 	/s/ David C. Evans
	 

	 	 	 	 
	 

	 	 	 	Name: David C. Evans
	 

	 	 	 	Title: Executive Vice President and Chief Financial Officer

	 	 	MIRACLE-GRO LAWN PRODUCTS, INC.

	 

	 	By:
	 	/s/ David C. Evans
	 

	 	 	 	 
	 

	 	 	 	Name: David C. Evans
	 

	 	 	 	Title: Executive Vice President and Chief Financial Officer

	 	 	OMS INVESTMENTS, INC.

	 

	 	By:
	 	/s/ David C. Evans
	 

	 	 	 	 
	 

	 	 	 	Name: Edward R. Claggett
	 

	 	 	 	Title: President and Chief Executive Officer

	 	 	HYPONEX CORPORATION

	 

	 	By:
	 	/s/ David C. Evans
	 

	 	 	 	 
	 

	 	 	 	Name: David C. Evans
	 

	 	 	 	Title: Executive Vice President and Chief Financial Officer

 

 

	 	 	 	 	 
	 	 	SCOTTS PRODUCTS CO.

	 

	 	By:
	 	/s/ David C. Evans
	 

	 	 	 	 
	 

	 	 	 	Name: David C. Evans
	 

	 	 	 	Title: Executive Vice President and Chief Financial Officer

	 	 	SCOTTS PROFESSIONAL PRODUCTS CO.

	 

	 	By:
	 	/s/ David C. Evans
	 

	 	 	 	 
	 

	 	 	 	Name: David C. Evans
	 

	 	 	 	Title: Executive Vice President and Chief Financial Officer

	 	 	SCOTTS-SIERRA HORTICULTURAL PRODUCTS COMPANY

	 

	 	By:
	 	/s/ David C. Evans
	 

	 	 	 	 
	 

	 	 	 	Name: David C. Evans
	 

	 	 	 	Title: Executive Vice President and Chief Financial Officer

	 	 	SCOTTS-SIERRA CROP PROTECTION COMPANY

	 

	 	By:
	 	/s/ David C. Evans
	 

	 	 	 	 
	 

	 	 	 	Name: David C. Evans
	 

	 	 	 	Title: Executive Vice President and Chief Financial Officer

	 	 	SCOTTS-SIERRA INVESTMENTS, INC.

	 

	 	By:
	 	/s/ Edward R. Claggett
	 

	 	 	 	 
	 

	 	 	 	Name: Edward R. Claggett
	 

	 	 	 	Title: President and Chief Executive Officer

	 	 	EG SYSTEMS, INC.

	 

	 	By:
	 	/s/ David C. Evans
	 

	 	 	 	 
	 

	 	 	 	Name: David C. Evans
	 

	 	 	 	Title: Executive Vice President and Chief Financial Officer

	 	 	SWISS FARMS PRODUCTS, INC.

	 

	 	By:
	 	/s/ Edward R. Claggett
	 

	 	 	 	 
	 

	 	 	 	Name: Edward R. Claggett
	 

	 	 	 	Title: President and Chief Executive Officer

 

 

	 	 	 	 	 
	 	 	SCOTTS MANUFACTURING COMPANY

	 

	 	By:
	 	/s/ David C. Evans
	 

	 	 	 	 
	 

	 	 	 	Name: David C. Evans
	 

	 	 	 	Title: Executive Vice President and Chief Financial Officer

	 	 	SCOTTS TEMECULA OPERATIONS, LLC

	 

	 	By:
	 	/s/ Edward R. Claggett
	 

	 	 	 	 
	 

	 	 	 	Name: Edward R. Claggett
	 

	 	 	 	Title: Vice President and Assistant Secretary

	 	 	SMITH & HAWKEN, LTD.

	 

	 	By:
	 	/s/ David C. Evans
	 

	 	 	 	 
	 

	 	 	 	Name: David C. Evans
	 

	 	 	 	Title: Senior Vice President

	 	 	SANFORD SCIENTIFIC, INC.

	 

	 	By:
	 	/s/ David C. Evans
	 

	 	 	 	 
	 

	 	 	 	Name: David C. Evans
	 

	 	 	 	Title: Executive Vice President and Chief Financial Officer

	 	 	SMG GROWING MEDIA, INC.

	 

	 	By:
	 	/s/ David C. Evans
	 

	 	 	 	 
	 

	 	 	 	Name: David C. Evans
	 

	 	 	 	Title: Executive Vice President and Chief Financial Officer

	 	 	GUTWEIN & CO., INC.

	 

	 	By:
	 	/s/ David C. Evans
	 

	 	 	 	 
	 

	 	 	 	Name: David C. Evans
	 

	 	 	 	Title: Executive Vice President and Chief Financial Officer

	 	 	ROD MCCLELLAN COMPANY

	 

	 	By:
	 	/s/ David C. Evans
	 

	 	 	 	 
	 

	 	 	 	Name: David C. Evans
	 

	 	 	 	Title: Executive Vice President and Chief Financial Officer

 

 

 

ACKNOWLEDGMENT AND CONSENT

          The undersigned hereby acknowledges receipt of a copy of the Amended and Restated Guarantee
and Collateral Agreement dated as of February 7, 2007 (the “Agreement”), made by the
Grantors parties thereto in favor of JPMorgan Chase Bank, N.A., as Administrative Agent. The
undersigned agrees for the benefit of the Administrative Agent and the Secured Parties as follows:

     SECTION 1. The undersigned will be bound by the terms of the Agreement and will comply with
such terms insofar as such terms are applicable to the undersigned.

     SECTION 2. The undersigned will notify the Administrative Agent promptly in writing of the
occurrence of any of the events described in Section 6.6(a) of the Agreement.

     SECTION 3. The terms of Sections 7.3(c) and 7.7 of the Agreement shall apply to it,
mutatis mutandis, with respect to all actions that may be required of it
pursuant to Section 7.3(c) or 7.7 of the Agreement.

	 	 	 	 	 
	 	[NAME OF ISSUER]

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 
	 
	 	Address for Notices:	 
	 
	 	 	 	 
	 	 	 
	 
	 	 	 	 
	 	 	 
	 
	 	 	 	 
	 	 	 
	 

	Fax:	 	 	 
	 

	 	 

	 

 

 

Annex 1 to

Amended and Restated Guarantee and Collateral Agreement

          ASSUMPTION AGREEMENT, dated as of                                         , 20___, made by
                                                            , a                     
corporation (the “Additional Grantor”), in
favor of JPMorgan Chase Bank, N.A., as administrative agent (in such capacity, the
“Administrative Agent”) for the banks and other financial institutions (the
“Lenders”) parties to the Credit Agreement referred to below. All capitalized terms not
defined herein shall have the meaning ascribed to them in such Credit Agreement.

W I
T N E S S E T H :

          WHEREAS, The Scotts Miracle-Gro Company, an Ohio corporation (the “Borrower”), the
Subsidiary Borrowers, the Lenders, the Administrative Agent, the Documentation Agent and the
Syndication Agent have entered into a Amended and Restated Credit Agreement, dated as of
[                    ] (as amended, supplemented or otherwise modified from time to time, the “Credit
Agreement”);

          WHEREAS, in connection with the Credit Agreement, the Borrower and certain of its Affiliates
(other than the Additional Grantor) have entered into the Amended and Restated Guarantee and
Collateral Agreement, dated as of [                    ] (as amended, supplemented or otherwise modified from
time to time, the “Guarantee and Collateral Agreement”) in favor of the Administrative
Agent for the ratable benefit of the Secured Parties;

          WHEREAS, the Credit Agreement requires the Additional Grantor to become a party to the
Guarantee and Collateral Agreement; and

          WHEREAS, the Additional Grantor has agreed to execute and deliver this Assumption Agreement in
order to become a party to the Guarantee and Collateral Agreement;

          NOW, THEREFORE, IT IS AGREED:

          1. Guarantee and Collateral Agreement. By executing and delivering this Assumption
Agreement, the Additional Grantor, as provided in Section 9.14 of the Guarantee and Collateral
Agreement, hereby becomes a party to the Guarantee and Collateral Agreement as a Grantor thereunder
with the same force and effect as if originally named therein as a Grantor and, without limiting
the generality of the foregoing, hereby expressly assumes all obligations and liabilities of a
Grantor thereunder. The information set forth in Annex 1-A hereto is hereby added to the
information set forth in the Schedules to the Guarantee and Collateral Agreement. The Additional
Grantor hereby represents and warrants that each of the representations and warranties contained in
Section 5 of the Guarantee and Collateral Agreement is true and correct on and as the date hereof
(after giving effect to this Assumption Agreement) as if made on and as of such date.

          2. Governing Law. THIS ASSUMPTION AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND
INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

[Remainder of page intentionally left blank]

 

2

          IN WITNESS WHEREOF, the undersigned has caused this Assumption Agreement to be duly executed
and delivered as of the date first above written.

	 	 	 	 	 
	 	[ADDITIONAL GRANTOR]

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 

 

 

Annex 1-A to

Assumption Agreement

Supplement to Schedule 1

Supplement to Schedule 2

Supplement to Schedule 3

Supplement to Schedule 4

 

 

SCHEDULE 1

NOTICE ADDRESSES OF GUARANTORS

	 	 	 
	1.

	 	The Scotts Miracle-Gro Company
	 

	 	14111 Scottslawn Road
	 

	 	Marysville, Ohio 43041
	 

	 	Attn: David M. Aronowitz
	 
	 	 
	2.

	 	The Scotts Company LLC
	 

	 	14111 Scottslawn Road
	 

	 	Marysville, Ohio 43041
	 

	 	Attn: David M. Aronowitz
	 
	 	 
	3.

	 	Miracle-Gro Lawn Products, Inc.
	 

	 	14111 Scottslawn Road
	 

	 	Marysville, Ohio 43041
	 

	 	Attn: David M. Aronowitz
	 
	 	 
	4.

	 	OMS Investments, Inc.
	 

	 	10250 Constellation Blvd., Suite 2800
	 

	 	Los Angeles, CA 90067-6228
	 

	 	Attn: Luis A. Rodriquez
	 
	 	 
	5.

	 	Hyponex Corporation
	 

	 	14111 Scottslawn Road
	 

	 	Marysville, Ohio 43041
	 

	 	Attn: David M. Aronowitz
	 
	 	 
	6.

	 	Scotts Products Co.
	 

	 	14111 Scottslawn Road
	 

	 	Marysville, Ohio 43041
	 

	 	Attn: David M. Aronowitz
	 
	 	 
	7.

	 	Scotts Professional Products Co.
	 

	 	14111 Scottslawn Road
	 

	 	Marysville, Ohio 43041
	 

	 	Attn: David M. Aronowitz
	 
	 	 
	8.

	 	Scotts-Sierra Horticultural Products Company
	 

	 	14111 Scottslawn Road
	 

	 	Marysville, Ohio 43041
	 

	 	Attn: David M. Aronowitz

 

 

	 	 	 
	9.

	 	Scotts-Sierra Crop Protection Company
	 

	 	14111 Scottslawn Road
	 

	 	Marysville, Ohio 43041
	 

	 	Attn: David M. Aronowitz
	 
	 	 
	10.

	 	Scotts-Sierra Investments, Inc.
	 

	 	Delaware Corporate Management
	 

	 	1105 N. Market Street
	 

	 	Wilmington, Delaware 19899
	 

	 	Attn: Susan T. Dubb
	 
	 	 
	11.

	 	EG Systems, Inc.
	 

	 	14111 Scottslawn Road
	 

	 	Marysville, Ohio 43041
	 

	 	Attn: David M. Aronowitz
	 
	 	 
	12.

	 	Swiss Farms Products, Inc.
	 

	 	3993 Howard Hughes Parkway, Suite 250
	 

	 	Las Vegas, Nevada 89169-6754
	 

	 	Attn: Garry J. Hills
	 
	 	 
	13.

	 	Scotts Manufacturing Company
	 

	 	14111 Scottslawn Road
	 

	 	Marysville, Ohio 43041
	 

	 	Attn: David M. Aronowitz
	 
	 	 
	14.

	 	Scotts Temecula Operations, LLC
	 

	 	14111 Scottslawn Road
	 

	 	Marysville, Ohio 43041
	 

	 	Attn: David M. Aronowitz
	 
	 	 
	15.

	 	Smith & Hawken, Ltd.
	 

	 	14111 Scottslawn Road
	 

	 	Marysville, Ohio 43041
	 

	 	Attn: David M. Aronowitz
	 
	 	 
	16.

	 	Sanford Scientific, Inc.
	 

	 	14111 Scottslawn Road
	 

	 	Marysville, Ohio 43041
	 

	 	Attn: David M. Aronowitz
	 
	 	 
	17.

	 	SMG Growing Media, Inc.
	 

	 	14111 Scottslawn Road
	 

	 	Marysville, Ohio 43041
	 

	 	Attn: David M. Aronowitz

 

 

	 	 	 
	18.

	 	Rod McLellan Company
	 

	 	14111 Scottslawn Road
	 

	 	Marysville, Ohio 43041
	 

	 	Attn: David M. Aronowitz
	 
	 	 
	19.

	 	Gutwein & Co., Inc.
	 

	 	14111 Scottslawn Road
	 

	 	Marysville, Ohio 43041
	 

	 	Attn: David M. Aronowitz

 

 

SCHEDULE 2

DESCRIPTION OF INVESTMENT PROPERTY

	 	 	 	 	 	 	 	 	 
	Issuer	 	Owner	 	Class of Stock	 	Certificate No.	 	No. of Shares
	 
	 	 	 	 	 	 	 	 
	Scotts
Manufacturing
Company

	 	The Scotts Company
LLC
	 	common shares, $.01 par value
	 	 2
	 	 1,000
	 
	 	 	 	 	 	 	 	 
	Miracle-Gro Lawn
Products, Inc.

	 	Scotts
Manufacturing
Company
	 	voting common stock, without par value
	 	V14
	 	 1,000
	 
	 	 	 	 	 	 	 	 
	 

	 	Scotts
Manufacturing
Company
	 	non-voting common stock, without par
value
	 	NV12
	 	 999.8
	 
	 	 	 	 	 	 	 	 
	OMS Investments,
Inc.

	 	The Scotts Company
LLC
	 	common stock,
$.01 par value
	 	 3
	 	 100
	 
	 	 	 	 	 	 	 	 
	Hyponex Corporation

	 	The Scotts Company
LLC
	 	common stock,
$.01 par value
	 	 3
	 	 100
	 
	 	 	 	 	 	 	 	 
	Scotts Products Co.

	 	The Scotts Company
LLC
	 	common shares, without par value
	 	 3
	 	 100
	 
	 	 	 	 	 	 	 	 
	Scotts Professional
Products Co.

	 	The Scotts Company
LLC
	 	common shares, without par value
	 	 3
	 	 100
	 
	 	 	 	 	 	 	 	 
	Scotts-Sierra
Horticultural
Products Company

	 	The Scotts Company
LLC
	 	Class A voting common shares,
$.001 par value
	 	Class A Cert. No. 6
	 	 101
	 
	 	 	 	 	 	 	 	 
	 

	 	The Scotts Company
LLC
	 	Class B non-voting common shares,
$.001 par value
	 	Class B Cert. No. 3
	 	 1
	 
	 	 	 	 	 	 	 	 
	Scotts-Sierra Crop
Protection Company

	 	Scotts-Sierra
Horticultural
Products Company
	 	common shares, without par value
	 	 2
	 	 100

 

 

	 	 	 	 	 	 	 	 	 
	Issuer	 	Owner	 	Class of Stock	 	Certificate No.	 	No. of Shares
	 
	 	 	 	 	 	 	 	 
	Scotts-Sierra
Investments, Inc.

	 	Scotts-Sierra

Horticultural
Products

 Company
	 	Class A common stock, without par value
	 	 5A
	 	 100
	 
	 	 	 	 	 	 	 	 
	 

	 	Scotts-Sierra

Horticultural
Products

 Company
	 	Class A common stock, without par value
	 	 6A
	 	 1
	 
	 

	 	Scotts-Sierra

Horticultural
Products

 Company
	 	Class B common stock, without par value
	 	 3B
	 	 1
	 
	 	 	 	 	 	 	 	 
	Swiss Farms
Products, Inc.

	 	
The Scotts Company
LLC
	 	common stock, without par value
	 	 2
	 	 100
	 
	 	 	 	 	 	 	 	 
	Smith & Hawken, Ltd.

	 	The Scotts Company
LLC
	 	common stock
	 	 18
	 	 11,652,708
	 
	 	 	 	 	 	 	 	 
	EG Systems, Inc.

	 	The Scotts Company
LLC
	 	common stock
	 	 29
	 	 36,480,458
	 
	 	 	 	 	 	 	 	 
	Sanford Scientific,
Inc.

	 	The Scotts Company
LLC
	 	common stock
	 	 8
	 	 99
	 
	 	 	 	 	 	 	 	 
	Gutwein & Co., Inc.

	 	The Scotts Miracle-Gro Company
	 	common stock
	 	 182
	 	 1,000
	 
	 	 	 	 	 	 	 	 
	SMG Growing Media,
Inc.

	 	The Scotts
Miracle-Gro Company
	 	common stock
	 	 1
	 	 100
	 
	 	 	 	 	 	 	 	 
	Rod McLellan Company

	 	SMG Growing Media,
Inc.
	 	common stock
	 	 189
	 	 100
	 
	 	 	 	 	 	 	 	 
	The Scotts Company
LLC

	 	The Scotts
Miracle-Gro Company
	 	limited liability company interest
(not certificated)
	 	n/a
	 	n/a

 

 

	 	 	 	 	 	 	 	 	 
	Issuer	 	Owner	 	Class of Stock	 	Certificate No.	 	No. of Shares
	 
	 	 	 	 	 	 	 	 
	Scotts Temecula
Operations, LLC

	 	OMS
Investments, Inc.
	 	limited liability company interest
(not certificated)
	 	n/a
	 	n/a

 

 

SCHEDULE 3

JURISDICTION OF ORGANIZATION AND IDENTIFICATION NUMBERS

	 	 	 	 	 
	COMPANY	 	STATE	 	ID #
	 	 	 	 	 
	The Scotts Miracle-Gro Company
	 	Ohio
	 	1501530
	 	 	 	 	 
	The Scotts Company LLC
	 	Ohio
	 	1503259
	 	 	 	 	 
	Miracle-Gro Lawn Products, Inc.
	 	New York
	 	1772705 (Tax Only)
	 	 	 	 	 
	OMS Investments, Inc.
	 	Delaware
	 	2435730
	 	 	 	 	 
	Hyponex Corporation
	 	Delaware
	 	2162423
	 	 	 	 	 
	Scotts Products Co.
	 	Ohio
	 	744802
	 	 	 	 	 
	Scotts Professional Products Co.
	 	Ohio
	 	744807
	 	 	 	 	 
	Scotts-Sierra Horticultural Products Company
	 	California
	 	515533
	 	 	 	 	 
	Scotts-Sierra Crop Protection Company
	 	California
	 	1587880
	 	 	 	 	 
	Scotts-Sierra Investments, Inc.
	 	Delaware
	 	2512334
	 	 	 	 	 
	EG Systems, Inc.
	 	Indiana
	 	1994111235
	 	 	 	 	 
	Swiss Farms Products, Inc.
	 	Delaware
	 	2948445
	 	 	 	 	 
	Scotts Manufacturing Company
	 	Delaware
	 	1369282
	 	 	 	 	 
	Scotts Temecula Operations, LLC
	 	Delaware
	 	3426222
	 	 	 	 	 
	Smith & Hawken, Ltd.
	 	Delaware
	 	2324901
	 	 	 	 	 
	Sanford Scientific, Inc.
	 	New York
	 	1072783
	 	 	 	 	 
	SMG Growing Media, Inc.
	 	Ohio
	 	1567999
	 	 	 	 	 
	Rod McLellan Company
	 	California
	 	C0358446
	 	 	 	 	 
	Gutwein & Co., Inc.
	 	Indiana
	 	194186-148

 

 

ACTIONS WITH RESPECT TO PLEDGED STOCK

          Delivery of Pledged Stock to JPMorgan Chase Bank, N.A., as Administrative Agent, indorsed in
blank by an effective indorsement or accompanied by undated stock powers with respect thereto, duly
indorsed in blank by an effective indorsement.

 

 

SCHEDULE 4

SUBSIDIARIES

Gutwein & Co., Inc., an Indiana corporation

SMG Brands, Inc., a Delaware corporation

SMG Growing Media, Inc., an Ohio corporation

Rod McLellan Company, a California corporation

SMGM LLC, an Ohio limited liability company

The Scotts Company LLC, an Ohio limited liability company

EG Systems, Inc., dba Scotts LawnService, an Indiana corporation

Hyponex Corporation, a Delaware corporation

OMS Investments, Inc., a Delaware corporation

Scotts Temecula Operations, LLC, a Delaware limited liability company

Sanford Scientific, Inc., a New York corporation

Scotts Global Services, Inc., an Ohio corporation

Scotts Manufacturing Company, a Delaware corporation

Miracle-Gro Lawn Products, Inc., a New York corporation

Scotts Products Co., an Ohio corporation

Scotts Professional Products Co., an Ohio corporation

Scotts-Sierra Horticultural Products Company, a California corporation

Scotts-Sierra Crop Protection Company, a California corporation

Scotts-Sierra Investments, Inc., a Delaware corporation

Smith & Hawken, Ltd., a Delaware corporation

Swiss Farms Products, Inc., a Delaware corporation

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00116-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00116-of-00352.parquet"}]]