Document:

Exhibit
10.1

 

CREDIT AND GUARANTY AGREEMENT

 

dated as of July 24, 2000

 

among

 

VOUGHT AIRCRAFT INDUSTRIES, INC.,

 

VAC HOLDINGS II, INC.,

 

and

 

CERTAIN SUBSIDIARIES OF VOUGHT AIRCRAFT INDUSTRIES, INC.,

as Guarantors,

 

VARIOUS LENDERS,

 

GOLDMAN SACHS CREDIT PARTNERS L.P.,

as Syndication Agent

 

LEHMAN COMMERCIAL PAPER INC.,

as Administrative Agent and Collateral Agent,

 

and

 

GOLDMAN SACHS CREDIT PARTNERS L.P.

LEHMAN BROTHERS INC.,

as Joint Arrangers and Joint Book Managers

 

 

 

$650,000,000 Senior Secured Credit Facilities

 

 

 

TABLE OF CONTENTS

 

	
  SECTION
  1.  DEFINITIONS AND INTERPRETATION

  	
  2

  
	
  1.1.  Definitions

  	
  2

  
	
  1.2.  Accounting Terms

  	
  32

  
	
  1.3.  Interpretation, etc.

  	
  32

  
	
   

  	
   

  
	
  SECTION 2.  LOANS AND LETTERS OF CREDIT

  	
  33

  
	
  2.1.  Term Loans

  	
  33

  
	
  2.2.  Revolving Loans

  	
  34

  
	
  2.3.  Swing Line Loans

  	
  35

  
	
  2.4.  Issuance of Letters of Credit and Purchase
  of Participations Therein

  	
  38

  
	
  2.5.  Pro Rata Shares; Availability of Funds

  	
  41

  
	
  2.6.  Use of Proceeds

  	
  42

  
	
  2.7.  Evidence of Debt; Register; Lenders’ Books
  and Records; Notes

  	
  42

  
	
  2.8.  Interest on Loans

  	
  43

  
	
  2.9.  Conversion/Continuation

  	
  45

  
	
  2.10.  Default Interest

  	
  46

  
	
  2.11.  Fees

  	
  46

  
	
  2.12.  Scheduled Payments/Commitment Reductions

  	
  47

  
	
  2.13.  Voluntary Prepayments/Commitment
  Reductions

  	
  49

  
	
  2.14.  Mandatory Prepayments/Commitment
  Reductions

  	
  50

  
	
  2.15.  Application of Prepayments/Reductions

  	
  52

  
	
  2.16.  General Provisions Regarding Payments

  	
  54

  
	
  2.17.  Ratable Sharing

  	
  55

  
	
  2.18.  Making or Maintaining Eurodollar Rate
  Loans

  	
  56

  
	
  2.19.  Increased Costs; Capital Adequacy

  	
  57

  
	
  2.20.  Taxes; Withholding, etc.

  	
  59

  
	
  2.21.  Obligation to Mitigate

  	
  61

  
	
  2.22.  Defaulting Lenders

  	
  61

  
	
  2.23.  Removal or Replacement of a Lender

  	
  62

  
	
   

  	
   

  
	
  SECTION 3.  CONDITIONS PRECEDENT

  	
  63

  
	
  3.1.  Closing Date

  	
  63

  
	
  3.2.  Conditions to Each Credit Extension

  	
  67

  
	
   

  	
   

  
	
  SECTION
  4.  REPRESENTATIONS AND WARRANTIES

  	
  68

  
	
  4.1.  Organization; Requisite Power and
  Authority; Qualification

  	
  68

  
	
  4.2.  Capital Stock

  	
  68

  
	
  4.3.  Due Authorization

  	
  69

  
	
  4.4.  No Conflict

  	
  69

  

 

 

	
  4.5.  Governmental Consents

  	
  69

  
	
  4.6.  Binding Obligation

  	
  70

  
	
  4.7.  Historical Financial Statements

  	
  70

  
	
  4.8.  Projections

  	
  70

  
	
  4.9.  No Material Adverse Change

  	
  70

  
	
  4.10.  Adverse Proceedings, etc

  	
  70

  
	
  4.11.  Payment of Taxes

  	
  71

  
	
  4.12.  Certain Properties

  	
  71

  
	
  4.13.  Environmental Matters

  	
  71

  
	
  4.14.  No Defaults

  	
  72

  
	
  4.15.
  Certain Contracts

  	
  72

  
	
  4.16.  Governmental Regulation

  	
  72

  
	
  4.17.  Margin Stock

  	
  72

  
	
  4.18.  Employee Matters

  	
  72

  
	
  4.19.  Employee Benefit Plans

  	
  73

  
	
  4.20.  Solvency

  	
  73

  
	
  4.21.  Related Agreements

  	
  74

  
	
  4.22.  Compliance with Statutes, etc.

  	
  74

  
	
  4.23.  Disclosure

  	
  74

  
	
   

  	
   

  
	
  SECTION 5.  AFFIRMATIVE COVENANTS

  	
  75

  
	
  5.1.  Financial Statements and Other Reports

  	
  75

  
	
  5.2.  Existence

  	
  77

  
	
  5.3.  Payment of Taxes and Claims

  	
  78

  
	
  5.4.  Maintenance of Properties

  	
  78

  
	
  5.5.  Insurance

  	
  78

  
	
  5.6.  Inspections

  	
  79

  
	
  5.7.  Lenders Meetings

  	
  79

  
	
  5.8.  Compliance with Laws

  	
  79

  
	
  5.9.  Environmental

  	
  79

  
	
  5.10.  Subsidiaries

  	
  81

  
	
  5.11.  Additional Material Real Estate Assets

  	
  81

  
	
  5.12.  Interest Rate Protection

  	
  81

  
	
  5.13.  Further Assurances

  	
  82

  
	
  5.14.  Post Closing Real Estate Obligations

  	
  82

  
	
  5.15.  Post Closing Personal Property Collateral
  Obligations

  	
  83

  
	
   

  	
   

  
	
  SECTION 6.  NEGATIVE COVENANTS

  	
  83

  
	
  6.1.  Indebtedness

  	
  83

  
	
  6.2. 
  Liens

  	
  85

  
	
  6.3.  Equitable Lien

  	
  87

  
	
  6.4.  No Further Negative Pledges

  	
  87

  
	
  6.5.  Restricted Junior Payments

  	
  87

  

 

 

	
  6.6.  Restrictions on Subsidiary Distributions

  	
  88

  
	
  6.7.  Investments

  	
  88

  
	
  6.8.  Financial Covenants

  	
  89

  
	
  6.9.  Fundamental Changes; Disposition of
  Assets; Acquisitions

  	
  94

  
	
  6.10.  Disposal of Subsidiary Interests

  	
  95

  
	
  6.11.  Sales and Lease-Backs

  	
  95

  
	
  6.12.  Transactions with Shareholders and
  Affiliates

  	
  95

  
	
  6.13.  Conduct of Business

  	
  95

  
	
  6.14.  Permitted Activities of Holdings

  	
  95

  
	
  6.15.  Amendments of Acquisition Agreement

  	
  96

  
	
  6.16.  Amendments or Waivers with respect to
  Subordinated Indebtedness

  	
  96

  
	
  6.17.  Fiscal Year

  	
  96

  
	
   

  	
   

  
	
  SECTION 7.  GUARANTY

  	
  96

  
	
  7.1.  Guaranty of the Obligations

  	
  96

  
	
  7.2.  Contribution by Guarantors

  	
  97

  
	
  7.3.  Payment by Guarantors

  	
  98

  
	
  7.4.  Liability of Guarantors Absolute

  	
  98

  
	
  7.5.  Waivers by Guarantors

  	
  100

  
	
  7.6.  Guarantors’ Rights of Subrogation,
  Contribution, etc.

  	
  101

  
	
  7.7.  Subordination of Other Obligations

  	
  102

  
	
  7.8.  Continuing Guaranty

  	
  102

  
	
  7.9.  Authority of Guarantors or Company

  	
  102

  
	
  7.10.  Financial Condition of Company

  	
  102

  
	
  7.11.  Bankruptcy, etc.

  	
  103

  
	
  7.12.  Discharge of Guaranty Upon Sale of
  Guarantor

  	
  103

  
	
   

  	
   

  
	
  SECTION 8.  EVENTS OF DEFAULT

  	
  104

  
	
  8.1.  Events of Default

  	
  104

  
	
   

  	
   

  
	
  SECTION 9.  AGENTS

  	
  107

  
	
  9.1.  Appointment of Agents

  	
  107

  
	
  9.2.  Powers and Duties

  	
  107

  
	
  9.3.  General Immunity

  	
  108

  
	
  9.4.  Agents Entitled to Act as Lender

  	
  108

  
	
  9.5.  Lenders’ Representations, Warranties and
  Acknowledgment

  	
  109

  
	
  9.6.  Right to Indemnity

  	
  109

  
	
  9.7.  Successor Administrative Agent and Swing
  Line Lender

  	
  110

  
	
  9.8.  Collateral Documents and Guaranty

  	
  110

  
	
   

  	
   

  
	
  SECTION 10.  MISCELLANEOUS

  	
  111

  
	
  10.1.  Notices

  	
  111

  
	
  10.2.  Expenses

  	
  111

  

 

 

	
  10.3.  Indemnity

  	
  112

  
	
  10.4.  Amendments and Waivers

  	
  113

  
	
  10.5.  Successors and Assigns; Participations

  	
  115

  
	
  10.6.  Independence of Covenants

  	
  118

  
	
  10.7.  Survival of Representations, Warranties
  and Agreements

  	
  118

  
	
  10.8.  No Waiver; Remedies Cumulative

  	
  118

  
	
  10.9.  Marshalling; Payments Set Aside

  	
  119

  
	
  10.10.  Severability

  	
  119

  
	
  10.11.  Obligations Several; Independent Nature of
  Lenders’ Rights

  	
  119

  
	
  10.12.  Headings

  	
  119

  
	
  10.13.  APPLICABLE LAW

  	
  119

  
	
  10.14.  CONSENT TO JURISDICTION

  	
  119

  
	
  10.15.  WAIVER OF JURY TRIAL

  	
  120

  
	
  10.16.  Confidentiality

  	
  121

  
	
  10.17.  Usury Savings Clause

  	
  121

  
	
  10.18.  Counterparts

  	
  122

  
	
  10.19.  Effectiveness

  	
  122

  

 

 

	
  APPENDICES:

  	
  A-1

  	
  Tranche A Term Loan Commitments

  
	
   

  	
  A-2

  	
  Tranche B Term Loan Commitments

  
	
   

  	
  A-3

  	
  Tranche C Term Loan Commitments

  
	
   

  	
  A-4

  	
  Revolving Credit Commitments

  
	
   

  	
   

  	
   

  
	
  SCHEDULES:

  	
  1.1

  	
  Financial
  Covenant Adjustments

  
	
   

  	
  3.1(i)

  	
  Closing Date
  Mortgaged Properties

  
	
   

  	
  3.1(j)

  	
  Certain
  Contracts

  
	
   

  	
  4.1

  	
  Jurisdictions of
  Organization and Qualification

  
	
   

  	
  4.2

  	
  Capital Stock
  and Ownership

  
	
   

  	
  4.12

  	
  Real Estate
  Assets

  
	
   

  	
  5.14(a)

  	
  Post Closing
  Real Estate Obligations

  
	
   

  	
  6.1

  	
  Certain
  Indebtedness

  
	
   

  	
  6.2

  	
  Certain Liens

  
	
   

  	
  6.7

  	
  Certain
  Investments

  
	
   

  	
  6.12

  	
  Certain
  Affiliate Transactions

  
	
   

  	
   

  	
   

  
	
  EXHIBITS:

  	
  A-1

  	
  Funding Notice

  
	
   

  	
  A-2

  	
  Conversion/Continuation
  Notice

  
	
   

  	
  A-3

  	
  Issuance Notice

  
	
   

  	
  B-1

  	
  Tranche A Term
  Loan Note

  
	
   

  	
  B-2

  	
  Tranche B Term
  Loan Note

  
	
   

  	
  B-3

  	
  Tranche C Term
  Loan Note

  
	
   

  	
  B-4

  	
  Revolving Loan
  Note

  
	
   

  	
  B-5

  	
  Swing Line Note

  
	
   

  	
  C

  	
  Compliance
  Certificate

  
	
   

  	
  D

  	
  Opinions of
  Counsel

  
	
   

  	
  E

  	
  Assignment
  Agreement

  
	
   

  	
  F

  	
  Certificate Re
  Non-bank Status

  
	
   

  	
  G-1

  	
  Closing Date
  Certificate

  
	
   

  	
  G-2

  	
  Solvency
  Certificate

  
	
   

  	
  H

  	
  Counterpart
  Agreement

  
	
   

  	
  I

  	
  Pledge and
  Security Agreement

  
	
   

  	
  J

  	
  Mortgage

  
	
   

  	
  K

  	
  Landlord
  Personal Property Collateral Access Agreement

  
	
   

  	
  L

  	
  Holdings Notes
  Term Sheet

  

 

 

CREDIT AND GUARANTY AGREEMENT

 

This CREDIT AND GUARANTY AGREEMENT, dated as of
July 24, 2000 is entered into by and among VOUGHT AIRCRAFT INDUSTRIES, INC., a Delaware
Corporation (“Company”), VAC HOLDINGS II, INC., a Delaware
corporation (“Holdings”), CERTAIN SUBSIDIARIES OF COMPANY, as
Guarantors, the Lenders party hereto from time to time, GOLDMAN SACHS CREDIT PARTNERS L.P.
(“GSCP”),
as Syndication Agent (in such capacity,”Syndication Agent”), LEHMAN COMMERCIAL PAPER INC.
(“LCP”),
as Administrative Agent (together with its permitted successors in such
capacity, “Administrative
Agent”) and as Collateral Agent (together with its permitted
successors in such capacity, “Collateral Agent”), and GSCP and LEHMAN
BROTHERS INC., (“LBI”) as Joint Arrangers and Joint Book
Managers (in such capacities, “Arrangers”).

 

RECITALS:

 

WHEREAS, capitalized terms used in these
Recitals shall have the respective meanings set forth for such terms in Section
1.1 hereof;

 

WHEREAS, Lenders have agreed to extend
certain credit facilities to Company, in an aggregate principal amount not to
exceed $650,000,000, consisting of $175,000,000 aggregate principal amount of
Tranche A Term Loans, $200,000,000 aggregate principal amount of Tranche B Term
Loans, $150,000,000 aggregate principal amount of Tranche C Term Loans, and up
to $125,000,000 aggregate principal amount of Revolving Commitments, the
proceeds of which will be used to as specified herein;

 

WHEREAS, Company has agreed to secure all
of its Obligations by granting to Collateral Agent, for the benefit of Secured
Parties, a First Priority Lien on certain of its assets, including a pledge of
all of the Capital Stock of each of its Domestic Subsidiaries and 65% of all
the Capital Stock of each of its Foreign Subsidiaries; and

 

WHEREAS, Guarantors have agreed to
guarantee the obligations of Company hereunder and to secure their respective
Obligations by granting to Collateral Agent, for the benefit of Secured
Parties, a First Priority Lien on certain of their respective assets, including
a pledge of all of the Capital Stock of each of their respective Domestic
Subsidiaries (including Company) and 65% of all the Capital Stock of each of
their respective Foreign Subsidiaries.

 

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

 

 

SECTION 1.  DEFINITIONS AND INTERPRETATION

 

1.1.  Definitions.  The following terms used herein, including
in the preamble, recitals, exhibits and schedules hereto, shall have the
following meanings:

 

“Acquired Business” means the assets,
liabilities, and operations acquired by the Company pursuant to the Acquisition
Agreement.

 

“Acquisition” means the acquisition of the
Acquired Business as contemplated by the Acquisition Agreement.

 

“Acquisition Agreement”  means that certain Asset Purchase Agreement
dated as of June 9, 2000 by and between Seller and Company.

 

“Adjusted Eurodollar Rate” means, for any
Interest Rate Determination Date with respect to an Interest Period for a
Eurodollar Rate Loan, the rate per annum obtained by dividing (and rounding
upward to the next whole multiple of 1/100 of 1%) (i) (a) the rate per annum (rounded
to the nearest 1/100 of 1%) equal to the rate determined by Administrative
Agent to be the offered rate which appears on the page of the Telerate Screen
which displays an average British Bankers Association Interest Settlement Rate
(such page currently being page number 3750) for deposits (for delivery on the
first day of such period) with a term equivalent to such period in Dollars,
determined as of approximately 11:00 a.m. (London, England time) on such
Interest Rate Determination Date, or (b) in the event the rate referenced in
the preceding clause (a) does not appear on such page or service or if such
page or service shall cease to be available, the rate per annum (rounded to the
nearest 1/100 of 1%) equal to the rate determined by Administrative Agent to be
the offered rate on such other page or other service which displays an average
British Bankers Association Interest Settlement Rate for deposits (for delivery
on the first day of such period) with a term equivalent to such period in
Dollars, determined as of approximately 11:00 a.m. (London, England time) on
such Interest Rate Determination Date, or (c) in the event the rates referenced
in the preceding clauses (a) and (b) are not available, the rate per annum
(rounded to the nearest 1/100 of 1%) equal to the offered quotation rate to
first class banks in the London interbank market by Deutsche Bank A.G. for
deposits (for delivery on the first day of the relevant period) in Dollars of
amounts in same day funds comparable to the principal amount of the applicable
Loan of Administrative Agent, in its capacity as a Lender, for which the
Adjusted Eurodollar Rate is then being determined with maturities comparable to
such period as of approximately 11:00 a.m. (London, England time) on such
Interest Rate Determination Date, by (ii) an amount equal to (a) one minus
(b) the Applicable Reserve Requirement.

 

“Administrative Agent” as defined in the
preamble hereto.

 

“Adverse Proceeding”  means any action, suit, proceeding (whether
administrative, judicial or otherwise), governmental investigation or
arbitration (whether or not purportedly on behalf of Holdings or any of its
Subsidiaries) at law or in equity, or before or by

 

 

any Governmental
Authority, domestic or foreign (including any Environmental Claims), pending
against or affecting directly Holdings or any of its Subsidiaries or any
material portion of the property of Holdings and its Subsidiaries.

 

“Affected Lender” as defined in Section
2.18(b).

 

“Affected Loans” as defined in Section
2.18(b).

 

“Affiliate” means, as applied to any
Person, any other Person directly or indirectly controlling, controlled by, or
under common control with, that Person. For the purposes of this definition,
“control” (including, with correlative meanings, the terms “controlling”,
“controlled by” and “under common control with”), as applied to any Person,
means the possession, directly or indirectly, of the power (i) to vote 15% or
more of the Securities having ordinary voting power for the election of
directors of such Person or (ii) to direct or cause the direction of the
management and policies of that Person, whether through the ownership of voting
securities or by contract or otherwise.

 

“Agent” means each of Administrative Agent,
Collateral Agent, Syndication Agent and each Arranger.

 

“Aggregate Amounts Due” as defined in
Section 2.17.

 

“Aggregate Payments” as defined in Section
7.2.

 

“Agreement” means this Credit and Guaranty
Agreement, dated as of July 24, 2000 as it may be amended, supplemented or
otherwise modified from time to time.

 

“Applicable Margin’’ and “Applicable
Revolving Commitment Fee Percentage’’ mean (i) with respect to Loans
that are Eurodollar Rate Loans and the Applicable Revolving Commitment Fee
Percentage, (a) from the Closing Date until the date of delivery of the
Compliance Certificate and the financial statements for the period ending
December 31, 2000, a percentage, per annum, determined by reference to the
following table as if the Leverage Ratio then in effect were  3.50:1.00; and (b) thereafter, a percentage,
per annum, determined by reference to the Leverage Ratio in effect from time to
time as set forth below:

 

	
  Leverage

  Ratio

  	
   

  	
  Applicable
  Margin

  for Tranche A Term

  Loans and

  Revolving Loans

  	
  Applicable
  Margin

  for Tranche B Term

  Loans

  	
  Applicable
  Margin

  for Tranche C

  Term Loans

  	
  Applicable
  Revolving

  Commitment

  Fee Percentage

  
	
  >3.50:1.00

  	
   

  	
  2.75 %

  	
  3.50 %

  	
  3.75 %

  	
  0.50 %

  
	
  <3.50:1.00

  >2.75:1.00

  	
   

  	
  2.50 %

  	
  3.50 %

  	
  3.75 %

  	
  0.50 %

  
	
  <2.75:1.00

  >2.00:1.00

  	
   

  	
  2.25 %

  	
  3.25 %

  	
  3.50 %

  	
  0.50 %

  
	
  <2.00:1.00

  >1.50:1.00

  	
   

  	
  2.00 %

  	
  3.25 %

  	
  3.50 %

  	
  0.38 %

  
	
  <1.50:1.00

  	
   

  	
  1.75 %

  	
  3.25 %

  	
  3.50 %

  	
  0.38 %

  

 

 

and (ii) with respect to Loans that are Base Rate Loans, an amount
equal to (a) the Applicable Margin for Eurodollar Rate Loans as set forth in
clause (i)(a) or (i)(b) above, as applicable, minus (b) 1.00% per annum.  No change in the Applicable Margin or the
Applicable Revolving Commitment Fee Percentage shall be effective until three
Business Days after the date on which Administrative Agent shall have received
the applicable financial statements and a Compliance Certificate pursuant to
Section 5.1(d) calculating the Leverage Ratio. 
At any time Company has not submitted to Administrative Agent the
applicable information as and when required under Section 5.1(d), the
Applicable Margin and the Applicable Revolving Commitment Fee Percentage shall
be determined as if the Leverage Ratio were in excess of 3.50:1.00 until such
time as the applicable information is delivered to the Administrative
Agent.  Within one Business Day of
receipt of the applicable information, Administrative Agent shall give each
Lender telefacsimile or telephonic notice (confirmed in writing) of the
Applicable Margin and the Applicable Revolving Commitment Fee Percentage in
effect from such date.

 

“Applicable Reserve Requirement” means, at
any time, for any Eurodollar Rate Loan, the maximum rate, expressed as a
decimal, at which reserves (including, without limitation, any basic marginal,
special, supplemental, emergency or other reserves) are required to be
maintained with respect thereto against “Eurocurrency liabilities” (as such
term is defined in Regulation D) under regulations issued from time to time by
the Board of Governors of the Federal Reserve System or other applicable
banking regulator.  Without limiting the
effect of the foregoing, the Applicable Reserve Requirement shall reflect any
other reserves required to be maintained by such member banks with respect to
(i) any category of liabilities which includes overseas Dollar deposits by
reference to which the applicable Adjusted Eurodollar Rate of a Loan is to be
determined, or (ii) any category of extensions of credit or other assets which
include Eurodollar Rate Loans.

 

“Arrangers” as defined in the preamble
hereto.

 

“Asset Sale” means a sale, lease or
sub-lease (as lessor or sublessor), sale and leaseback, assignment, conveyance,
transfer or other disposition to, or any exchange of property with (other than
a substantially contemporaneous like-kind exchange), any Person (other than
Company or any Guarantor Subsidiary or an issuance of Capital Stock by Company
to Holdings), in one transaction or a series of transactions, of all or any
part of Holdings’s or any of its Subsidiaries’ businesses, assets or properties
of any kind, whether real, personal, or mixed and whether tangible or
intangible, whether now owned or hereafter acquired, including, without
limitation, the Capital Stock of any of Holdings’ Subsidiaries, other than (i)
inventory (or other assets) sold or leased, assigned, conveyed, transferred or
disposed of in the ordinary course of business, (ii) disposals of scrap or
obsolete, worn out or idle property or property that is not being used in the
business and (iii) sales of other assets for aggregate net consideration of
less than $5,000,000 with respect to any transaction or series of related
transactions, and less than

 

 

$25,000,000 in the
aggregate during the term of this Agreement.

 

“Assignment Agreement” means an Assignment
Agreement substantially in the form of Exhibit E, with such amendments or modifications
as may be approved by Administrative Agent.

 

“Authorized Officer” means, as applied to
any Person, any individual holding the position of chairman of the board (if an
officer), chief executive officer, president or one of its vice presidents (or
the equivalent thereof), or such Person’s chief financial officer, controller,
secretary or treasurer.

 

“Bankruptcy Code” means Title 11 of the
United States Code entitled “Bankruptcy,” as now and hereafter in effect, or
any successor statute.

 

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

 

“Base Rate Loan” means a Loan bearing
interest at a rate determined by reference to the Base Rate.

 

“Beneficiary” means each Agent, Issuing
Bank, Lender and Lender Counterparty.

 

“Business Day” means (i) any day excluding
Saturday, Sunday and any day which is a legal holiday under the laws of the
State of New York or is a day on which banking institutions located in such
state are authorized or required by law or other governmental action to close
and (ii) with respect to all notices, determinations, fundings and payments in
connection with the Adjusted Eurodollar Rate or any Eurodollar Rate Loans, the
term “Business
Day” shall mean any day which is a Business Day described in clause
(i) and which is also a day for trading by and between banks in Dollar deposits
in the London interbank market.

 

“Capital Lease” means, as applied to any
Person, any lease of any property (whether real, personal or mixed) by that
Person as lessee that, in conformity with GAAP, is or should be accounted for
as a capital lease on the balance sheet of that Person.

 

“Capital Stock” means 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),
including, without limitation, partnership interests and membership interests,
and any and all warrants, rights or options to purchase or other arrangements
or rights to acquire any of the foregoing.

 

 

“Cash” means money, currency or a credit
balance in any demand or Deposit Account.

 

“Cash Equivalents” means, as at any date of
determination, (i) marketable securities (a) issued or directly and
unconditionally guaranteed as to interest and principal by the United States
Government or (b) issued by any agency of the United States the obligations of
which are backed by the full faith and credit of the United States, in each
case maturing within one year after such date; (ii) marketable direct
obligations issued by any state of the United States of America or any
political subdivision of any such state or any public instrumentality thereof,
in each case maturing within one year after such date and having, at the time
of the acquisition thereof, a rating of at least A-1 from S&P or at least
P-1 from Moody’s; (iii) commercial paper maturing no more than one year from
the date of creation thereof and having, at the time of the acquisition
thereof, a rating of at least A-1 from S&P or at least P-1 from Moody’s;
(iv) certificates of deposit or bankers’ acceptances maturing within one year
after such date and issued or accepted by any Lender or by any commercial bank
organized under the laws of the United States of America or any state thereof
or the District of Columbia that (a) is at least “adequately capitalized” (as
defined in the regulations of its primary Federal banking regulator) and (b)
has Tier 1 capital (as defined in such regulations) of not less than
$100,000,000; and (v) shares of any money market mutual fund that (a) has
substantially all of its assets invested continuously in the types of
investments referred to in clauses (i) and (ii) above and (b) has net assets of
not less than $500,000,000.

 

“Certificate re Non-Bank Status” means a
certificate substantially in the form of Exhibit F.

 

“Change of Control” means, at any time, (i)
(a) prior to consummation of an initial public offering by Holdings, Sponsor
and its Affiliates and other Permitted Investors shall cease to beneficially
own and control at least 51% on a fully diluted basis of the economic and
voting interests in the Capital Stock of Holdings (b) after consummation of any
initial public offering, Sponsor, its Affiliates and other Permitted Investors
shall cease to own and control at least 30% of the Capital Stock of Holdings or
such higher percentage that exceeds the highest percentage owned by any Person
or “group” (within the meaning of Rules 13d-3 and 13d-5 under the Exchange Act)
other than Sponsor and its Affiliates and the other Permitted Investors, (ii)
Sponsor, its Affiliates and other Permitted Investors shall cease to have the
power (whether or not exercised) to elect a majority of the members of the
board of directors (or similar governing body) of Holdings; (iii) Holdings
shall cease to beneficially own and control 100% on a fully diluted basis of
the economic and voting interest in the Capital Stock of Company; or (iv) any
“change of control” or similar event under the Holdings Notes shall occur.

 

“Class” means (i) with respect to Lenders,
each of the following classes of Lenders: (a) Lenders having Tranche A Term
Loan Exposure, (b) Lenders having Tranche B Term Loan Exposure, (c) Lenders
having Tranche C Term Loan Exposure, and (d) Lenders

 

 

having Revolving Exposure
(including Swing Line Lender), and (ii) with respect to Loans, each of the
following classes of Loans: (a) Tranche A Term Loans, (b) Tranche B Term Loans,
(c) Tranche C Term Loans, and (d) Revolving Loans (including Swing Line Loans).

 

“Closing Date” means the date on or before
July 31, 2000 on which the Term Loans are made.

 

“Closing Date Certificate” means a Closing
Date Certificate substantially in the form of Exhibit G-1.

 

“Closing Date Mortgaged Property” as
defined in Section 3.1(i).

 

“Collateral” means, collectively, all of
the real, personal and mixed property (including Capital Stock) in which Liens
are purported to be granted pursuant to the Collateral Documents as security
for the Obligations.

 

“Collateral Agent” means the institution
serving as such under the Collateral Documents and as defined in the preamble
hereto.

 

“Collateral Documents” means the Pledge and
Security Agreement, the Mortgages, the Landlord Personal Property Collateral
Access Agreements, if any, and all other instruments, documents and agreements
delivered by any Credit Party pursuant to this Agreement or any of the other
Credit Documents in order to grant to Collateral Agent, for the benefit of
Secured Parties, a Lien on any real, personal or mixed property of that Credit
Party as security for the Obligations.

 

“Company” as defined in the preamble
hereto.

 

“Commitment” means any of the Revolving
Commitment or Term Loan Commitment.

 

“Compliance Certificate” means a Compliance
Certificate substantially in the form of Exhibit C.

 

“Consent to Assignment” shall mean a
consent to assignment of a contract in form reasonably satisfactory to the
Collateral Agent executed and delivered by the counterparty to such contract.

 

“Consolidated Adjusted EBITDA” means, for
any period, the sum, for Holdings and its Subsidiaries (determined on a
consolidated basis without duplication in accordance with GAAP), of the
following: (a) net operating income (calculated before taxes, Consolidated
Interest Expense, extraordinary and unusual items and income or loss
attributable to equity in Affiliates) for such period, plus (b)
depreciation and amortization and all other non-cash charges, in each case for
such period and to the extent deducted in computing net

 

 

operating income for such
period, plus (c) the amount by which the amount of deferred learning
costs, tooling costs and similar assets were reduced from the first day of such
period to the last day of such period and minus (d) the amount by which
the amount of deferred learning costs, tooling costs and similar assets were
increased from the first day of such period to the last day of such period; provided
that the foregoing shall be subject to the adjustments described in Schedule
1.1.

 

“Consolidated Capital Expenditures” means,
for any period, the aggregate of all expenditures of Holdings and its
Subsidiaries during such period determined on a consolidated basis that, in
accordance with GAAP, are or should be included in “purchase of property and
equipment” or similar items reflected in the consolidated statement of cash
flows of Holdings and its Subsidiaries; provided that the following
expenditures shall not be deemed Consolidated Capital Expenditures (i) Permitted
Acquisitions, (ii) Permitted Investments and (iii) expenditures made with or
reimbursed from the proceeds of insurance or condemnation payments.

 

“Consolidated Cash Interest Expense” means,
for any period, Consolidated Interest Expense for such period, excluding any
amount not paid or received in Cash during such period.

 

“Consolidated Excess Cash Flow” means, for
any period, an amount (if positive) equal to: (i) Consolidated Adjusted EBITDA,
minus (ii) the sum, without duplication, of the amounts for such period
of (a) voluntary and scheduled repayments of Consolidated Total Debt (excluding
repayments of Revolving Loans or Swing Line Loans except to the extent the
Revolving Commitments are permanently reduced in connection with such
repayments), (b) Consolidated Capital Expenditures (net of any proceeds of any
related financings with respect to such expenditures), (c) Consolidated
Interest Expense, (d) the provision for current taxes based on income of
Holdings and its Subsidiaries and payable in cash with respect to such period,
(e) cash payments made in connection with Permitted Acquisitions and Permitted
Investments not in excess of $15,000,000 in the aggregate in any Fiscal Year
(net of any proceeds with respect to any related financing), (f) purchase price
adjustments with respect to working capital payable by Holdings or the Company
in accordance with the Acquisition Agreement and (g) Transaction Costs paid
within 180 days of the Closing Date.

 

“Consolidated Fixed Charges” means, for any
period, the sum, without duplication, of the amounts determined for Holdings
and its Subsidiaries on a consolidated basis equal to (i) Consolidated Cash
Interest Expense, (ii) scheduled payments of principal on Consolidated Total
Debt, (iii) Consolidated Capital Expenditures and (iv) the portion of taxes
based on income actually paid in cash; provided that Consolidated Fixed
Charges for any period prior to the Closing Date shall be determined in
accordance with Schedule 1.1.

 

“Consolidated Interest Expense” means, for
any period, total interest expense (including that portion attributable to
Capital Leases in accordance with GAAP and capitalized

 

 

interest) of Holdings and
its Subsidiaries on a consolidated basis with respect to all outstanding
Indebtedness for Borrowed Money of Holdings and its Subsidiaries, including all
commissions, discounts and other fees and charges owed with respect to letters
of credit and plus the net amount paid (or minus the net amount received) under
Interest Rate Agreements (whether or not actually paid or received during such
period), but excluding, however, any amounts referred to in Section
2.11(d)  and any amounts expended for
up-front costs in relation to interest rate collars and similar Interest Rate
Agreements entered into pursuant to Section 5.12., in each case payable within
ninety days of the Closing Date and minus the amount of consolidated interest
income, if any, for such period.

 

“Consolidated Total Debt” means, as at any
date of determination, the aggregate stated balance sheet amount of all
Indebtedness for Borrowed Money of Holdings and its Subsidiaries, other than
the Holdings Notes, determined on a consolidated basis in accordance with GAAP.

 

“Contractual Obligation” means, as applied
to any Person, any provision of any Security issued by that Person or of any
material indenture, mortgage, deed of trust, contract, undertaking, agreement
or other instrument to which that Person is a party or by which it or any of
its properties is bound or to which it or any of its properties is subject.

 

“Conversion/Continuation Date” means the
effective date of a continuation or conversion, as the case may be, as set
forth in the applicable Conversion/Continuation Notice.

 

“Conversion/Continuation Notice” means a
Conversion/Continuation Notice substantially in the form of Exhibit A-2.

 

“Counterpart Agreement” means a Counterpart
Agreement substantially in the form of Exhibit H delivered by a Credit Party
pursuant to Section 5.10.

 

“Contributing Guarantors” as defined in
Section 7.2.

 

“Credit Date” means the date of a Credit
Extension.

 

“Credit Document” means any of this
Agreement, the Notes, if any, the Collateral Documents, any documents or
certificates executed by Company in favor of Issuing Bank relating to Letters
of Credit, and all other documents, instruments or agreements executed and
delivered by a Credit Party for the benefit of any Agent, Issuing Bank or any
Lender in connection herewith.

 

“Credit Extension” means the making of a
Loan or the issuing of a Letter of Credit.

 

“Credit Party” means Holdings, the Company
and any Guarantor Subsidiary from time to time party to a Credit Document.

 

 

“Currency Agreement” means any foreign
exchange contract, currency swap agreement, futures contract, option contract,
synthetic cap or other similar agreement or arrangement, each of which is for
the purpose of hedging the foreign currency risk associated with Holdings’ and
its Subsidiaries’ operations and not for speculative purposes.

 

“Default” means a condition or event that,
after notice or lapse of time or both, would constitute an Event of Default.

 

“Default Excess” means, with respect to any
Defaulting Lender, the excess, if any, of such Defaulting Lender’s Pro Rata
Share of the aggregate outstanding principal amount of Loans of all Lenders
(calculated as if all Defaulting Lenders (other than such Defaulting Lender)
had funded all of their respective Defaulted Loans) over the aggregate
outstanding principal amount of all Loans of such Defaulting Lender.

 

“Default Period” means, with respect to any
Defaulting Lender, the period commencing on the date of the applicable Funding
Default and ending on the earliest of the following dates:  (i) the date on which all Commitments are
cancelled or terminated and/or the Obligations are declared or become
immediately due and payable, (ii) the date on which (a) the Default Excess with
respect to such Defaulting Lender shall have been reduced to zero (whether by
the funding by such Defaulting Lender of any Defaulted Loans of such Defaulting
Lender or by the non-pro rata application of any voluntary or mandatory
prepayments of the Loans in accordance with the terms of Section 2.13 or
Section 2.14 or by a combination thereof) and (b) such Defaulting Lender shall
have delivered to Company and Administrative Agent a written reaffirmation of
its intention to honor its obligations hereunder with respect to its
Commitments, and (iii) the date on which Company, Administrative Agent and
Requisite Lenders waive all Funding Defaults of such Defaulting Lender in writing.

 

“Defaulting Lender” as defined in Section
2.22.

 

“Defaulted Loan” as defined in Section
2.22.

 

“Deposit Account” means a demand, time,
savings, passbook or like account with a bank, savings and loan association,
credit union or like organization, other than an account evidenced by a
negotiable certificate of deposit.

 

“Dollars” and the sign “$” mean the lawful money of
the United States of America.

 

“Domestic Subsidiary” means any Subsidiary
organized under the laws of the United States of America, any State thereof or
the District of Columbia (other than a Subsidiary of a foreign Subsidiary).

 

“Eligible Assignee” means (i) any Lender,
any Affiliate of any Lender and any

 

 

Related Fund (any two or
more Related Funds being treated as a single Eligible Assignee for all purposes
hereof), and (ii) any commercial bank, insurance company, investment or mutual
fund or other entity that is an “accredited investor” (as defined in Regulation
D under the Securities Act) and which extends credit or buys loans as one of
its businesses; provided, except as may otherwise be agreed by
Syndication Agent and Administrative Agent, no Affiliate of Holdings shall be
an Eligible Assignee.

 

“Employee Benefit Plan” means any “employee
benefit plan” as defined in Section 3(3) of ERISA which is or was sponsored,
maintained or contributed to by, or required to be contributed by the Company,
Holdings, any of their Subsidiaries or any of their respective ERISA
Affiliates.

 

“Environmental Claim” means any written
notice, notice of violation, claim, action, suit, proceeding, demand, abatement
order or other order or directive (conditional or otherwise), by any
governmental authority or any other Person, arising (i) pursuant to or in
connection with any actual or alleged violation of any Environmental Law; (ii)
in connection with any Hazardous Material or any actual or alleged Hazardous
Materials Activity; or (iii) in connection with any actual or alleged damage,
injury, threat or harm to health, safety, natural resources or the environment.

 

“Environmental Laws” means any and all
current or future foreign or domestic, federal or state (or any subdivision of
either of them), statutes, ordinances, orders, rules, regulations, judgments,
Governmental Authorizations, or any other requirements of Governmental
Authorities relating to (i) environmental matters, including those relating to
pollution or the protection of the environment; (ii) the generation, use,
storage, transportation or Release of Hazardous Materials; or (iii)
occupational safety and health, industrial hygiene or the protection of human
health.

 

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

 

“ERISA Affiliate” means, as applied to any
Person, (i) any corporation which is a member of a controlled group of
corporations within the meaning of Section 414(b) of the Internal Revenue Code
of which that Person is a member; (ii) any trade or business (whether or not
incorporated) which is a member of a group of trades or businesses under common
control within the meaning of Section 414(c) of the Internal Revenue Code of
which that Person is a member; and (iii) any member of an affiliated service
group within the meaning of Section 414(m) or (o) of the Internal Revenue Code
of which that Person, any corporation described in clause (i) above or any
trade or business described in clause (ii) above is a member.  Any former ERISA Affiliate of the Company,
Holdings or any of their Subsidiaries shall continue to be considered an ERISA
Affiliate of the Company, Holdings or any such Subsidiary within the meaning of
this definition with respect to the period such entity was an ERISA Affiliate
of the Company, Holdings or such Subsidiary and with respect to liabilities
arising after such period for

 

 

which the Company,
Holdings or such Subsidiary could be liable under the Internal Revenue Code or
ERISA.

 

“ERISA Event” means (i) a “reportable
event” within the meaning of Section 4043 of ERISA and the regulations issued
thereunder with respect to any Pension Plan (excluding those for which the
provision for 30-day notice to the PBGC has been waived by regulation); (ii)
the failure to meet the minimum funding standard of Section 412 of the Internal
Revenue Code with respect to any Pension Plan (whether or not waived in
accordance with Section 412(d) of the Internal Revenue Code) or the failure to
make by its due date a required installment under Section 412(m) of the
Internal Revenue Code with respect to any Pension Plan or the failure to make
any required contribution to a Multiemployer Plan; (iii) the provision by the
administrator of any Pension Plan pursuant to Section 4041(a)(2) of ERISA of a
notice of intent to terminate such plan in a distress termination described in
Section 4041(c) of ERISA; (iv) the withdrawal by the Company, Holdings, any of
their Subsidiaries or any of their respective ERISA Affiliates from any Pension
Plan with two or more contributing sponsors or the termination of any such
Pension Plan in each case resulting in liability to the Company, Holdings, any
of their Subsidiaries or any of their respective ERISA Affiliates, pursuant to
Section 4063 or 4064 of ERISA in excess of $5,000,000; (v) the institution by
the PBGC of proceedings to terminate any Pension Plan, or the occurrence of any
event or condition which might constitute grounds under ERISA for the
termination of, or the appointment of a trustee to administer, any Pension
Plan; (vi) the imposition of liability in excess of $5,000,000 on the Company,
Holdings, any of their Subsidiaries or any of their respective ERISA Affiliates
pursuant to Section 4062(e) or 4069 of ERISA or by reason of the application of
Section 4212(c) of ERISA; (vii) the withdrawal of the Company, Holdings, any of
their Subsidiaries or any of their respective ERISA Affiliates in a complete or
partial withdrawal (within the meaning of Sections 4203 and 4205 of ERISA) from
any Multiemployer Plan if there is any potential liability in excess of
$5,000,000 therefor to the Company, Holdings, any of their Subsidiaries or any
of their respective ERISA Affiliates, or the receipt by the Company, Holdings,
any of their Subsidiaries or any of their respective ERISA Affiliates of notice
from any Multiemployer Plan that it is in reorganization or insolvency pursuant
to Section 4241 or 4245 of ERISA, or that it intends to terminate or has
terminated under Section 4041A or 4042 of ERISA; (viii) the occurrence of an
act or omission which could give rise to the imposition on the Company,
Holdings, any of their Subsidiaries or any of their respective ERISA Affiliates
of fines, penalties, taxes or related charges in excess of $5,000,000 under
Chapter 43 of the Internal Revenue Code or under Section 409, Section 502(c),
or Section 4071 of ERISA in respect of any Employee Benefit Plan; (ix) the
assertion of a material claim (other than routine claims for benefits) against
any Employee Benefit Plan other than a Multiemployer Plan or the assets
thereof, or against the Company, Holdings, any of their Subsidiaries or any of
their respective ERISA Affiliates in connection with any Employee Benefit Plan,
in each case for an amount in excess of $5,000,000; (x) receipt from the
Internal Revenue Service of notice of the failure of any Pension Plan (or any
other Employee Benefit Plan intended to be qualified under Section 401(a) of
the Internal Revenue Code) to qualify under Section 401(a) of the Internal
Revenue Code, or the failure of any trust forming part of any Pension Plan to
qualify for exemption from taxation under Section 501(a)

 

 

of the Internal Revenue
Code; or (xi) the imposition of a Lien pursuant to Section 401(a)(29) or 412(n)
of the Internal Revenue Code or pursuant to ERISA with respect to any Pension
Plan.

 

“Eurodollar Rate Loan” means a Loan bearing
interest at a rate determined by reference to the Adjusted Eurodollar Rate.

 

“Event of Default” means each of the
conditions or events set forth in Section 8.1.

 

“Exchange Act” means the Securities
Exchange Act of 1934, as amended from time to time, and any successor statute.

 

“Facility” means any real property
(including all buildings, fixtures or other improvements located thereon) now,
hereafter or heretofore owned, leased, operated or used by Holdings or any of
its Subsidiaries or any of their respective predecessors or Affiliates.

 

“Fair Share Contribution Amount” as defined
in Section 7.2.

 

“Fair Share” as defined in Section 7.2.

 

“Fair Share Shortfall” as defined in
Section 7.2.

 

“Federal Funds Effective Rate” means for
any day, the rate per annum (expressed, as a decimal, rounded upwards, if
necessary, to the next higher 1/100 of 1%) equal to the weighted average of the
rates on overnight Federal funds transactions with members of the Federal
Reserve System arranged by Federal funds brokers on such day, as published by
the Federal Reserve Bank of New York on the Business Day next succeeding such
day; provided, (i) if such day is not a Business Day, the Federal Funds
Rate for such day shall be such rate on such transactions on the next preceding
Business Day as so published on the next succeeding Business Day, and (ii) if
no such rate is so published on such next succeeding Business Day, the Federal
Funds Rate for such day shall be the average rate charged to Administrative
Agent, in its capacity as a Lender, on such day on such transactions as
determined by Administrative Agent.

 

“Financial Officer Certification” means,
with respect to the financial statements for which such certification is
required, the certification of the chief financial officer, controller or
treasurer of Holdings that such financial statements fairly present, in all
material respects, the financial condition of Holdings and its Subsidiaries as
at the dates indicated and the results of their operations and their cash flows
for the periods indicated, subject to changes resulting from audit and normal
year-end adjustments.

 

“Financial Plan” as defined in Section
5.1(i).

 

 

“Financial Statement” means item (ii) of
the definition of Historical Financial Statements.

 

“First Priority” means, with respect to any
Lien purported to be created in any Collateral pursuant to any Collateral
Document, that such Lien is the only Lien to which such Collateral is subject,
other than Permitted Liens.

 

“Fiscal Quarter” means a fiscal quarter of
any Fiscal Year.

 

“Fiscal Year” means the fiscal year of
Holdings and its Subsidiaries ending on December 31, of each calendar year.

 

“Fixed Charge Coverage Ratio” means the
ratio as of the last day of any Fiscal Quarter of (i) Consolidated Adjusted
EBITDA for the four-Fiscal Quarter Period then ending, to (ii) Consolidated
Fixed Charges for such four-Fiscal Quarter Period; provided that the
calculations of the Fixed Charge Coverage Ratio shall be subject to adjustment
as set forth in Schedule 1.1.

 

“Flood Hazard Property” means any Real
Estate Asset subject to a mortgage in favor of Administrative Agent, for the
benefit of Lenders, and located in an area designated by the Federal Emergency
Management Agency as having special flood or mud slide hazards.

 

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

 

“Funding Default” as defined in Section
2.22.

 

“Funding Guarantors” as defined in Section
7.2.

 

“Funding Notice” means a notice
substantially in the form of Exhibit A-1.

 

“GAAP” means, subject to the limitations on
the application thereof set forth in Section 1.2, United States generally
accepted accounting principles in effect as of the date of determination
thereof.

 

“Governmental Acts” means any act or
omission, whether rightful or wrongful, of any present or future de jure or de
facto government or Governmental Authority.

 

“Governmental Authority” means any federal,
state, municipal, national or other government, governmental department,
commission, board, bureau, court, agency or instrumentality or political
subdivision thereof or any public entity exercising executive, legislative,
judicial, regulatory or administrative functions of or pertaining to any
government or any court, in each case whether associated with a state of the United
States, the United States, or a foreign entity or government.

 

 

“Governmental Authorization” means any
permit, license, authorization, plan, directive, consent order or consent
decree of or from any Governmental Authority.

 

“Grantor” as defined in the Pledge and
Security Agreement.

 

“Guaranteed Obligations” as defined in
Section 7.1.

 

“Guarantor” means each of Holdings and each
Domestic Subsidiary of Holdings (other than Company).

 

“Guarantor Subsidiary” means each Guarantor
other than Holdings.

 

“Guaranty” means the guaranty of each
Guarantor set forth in Section 7.

 

“Hazardous Materials” means (A) any
petroleum or petroleum products, radioactive materials, PCBs, or friable
asbestos; (B) any chemicals or other materials or substances which are now defined
as or included in the definition of “hazardous substances,” “hazardous wastes,”
“hazardous materials,” “extremely hazardous wastes,” “restricted hazardous
wastes,” “toxic substances,” or “toxic pollutants” or words of similar import
under any Environmental Law; and (C) pesticides.

 

“Hazardous Materials Activity” means any
activity, event or occurrence involving any Hazardous Materials, including the
use, manufacture, possession, storage, holding, Release, threatened Release,
discharge, placement, generation, transportation, processing, treatment,
abatement, removal, remediation, disposal, disposition or handling of any
Hazardous Materials, and any corrective action or response action with respect
to any of the foregoing.

 

“Hedge Agreement” means an Interest Rate
Agreement or a Currency Agreement entered into in order to satisfy the
requirements of this Agreement.

 

“Highest Lawful Rate” means the maximum
lawful interest rate, if any, that at any time or from time to time may be
contracted for, charged, or received under the laws applicable to any Lender
which are presently in effect or, to the extent allowed by law, under such
applicable laws which may hereafter be in effect and which allow a higher
maximum nonusurious interest rate than applicable laws now allow.

 

“Historical Financial Statements” means as
of the Closing Date, (i) the description of accounting methods, policies,
practices and procedures used in preparation of the statements described in
clauses (ii) and (iii) below; (ii) the audited statement of assets and
liabilities of the Acquired Business (titled as “Statement of Net Assets
Subject to Section 4.2 of the Asset Purchase Agreement March 31, 2000”),
excluding all cash accounts, Pension Plan assets and liabilities, other
post-retirement liabilities, income and franchise related tax accounts,

 

 

workers’ compensation
assets and liabilities and employee payroll, payroll tax and payroll
withholding liabilities, at March 31, 2000 and the notes thereto; and the (iii)
unaudited statements of revenues, costs and expenses of the Acquired Business
for each of the three fiscal years ended December 31, 1999 and for the three
months ended March 31, 2000 and the notes thereto.

 

“Holdings” as defined in the preamble
hereto.

 

“Holdings Notes” means the Subordinated
Promissory Notes issued to Seller in an aggregate original principal amount as
of the Closing Date of $175,000,000 with terms substantially as set forth in
the term sheet with respect thereto set forth in Exhibit L.

 

“Income Statements” means item (iii) of the
definition of Historical Financial Statements.

 

“Increased-Cost Lenders” as defined in
Section 2.23.

 

“Indebtedness”, as applied to any Person,
means, without duplication, (i) all indebtedness for borrowed money; (ii) that
portion of obligations with respect to Capital Leases that is properly
classified as a liability on a balance sheet in conformity with GAAP; (iii)
notes payable and drafts accepted representing extensions of credit whether or
not representing obligations for borrowed money; (iv) any obligation owed for
all or any part of the deferred purchase price of property or services
(excluding any such obligations incurred under ERISA and ordinary course trade
payables), which purchase price is (a) due more than six months from the date
of incurrence of the obligation in respect thereof or (b) evidenced by a note
or similar written instrument; (v) all indebtedness secured by any Lien on any
property or asset owned or held by that Person regardless of whether the
indebtedness secured thereby shall have been assumed by that Person or is
nonrecourse to the credit of that Person; (vi) the face amount of any letter of
credit issued for the account of that Person or as to which that Person is
otherwise liable for reimbursement of drawings; (vii) the direct or indirect
guaranty, endorsement (otherwise than for collection or deposit in the ordinary
course of business), co-making, discounting with recourse or sale with recourse
by such Person of the obligation of another; (viii) any obligation of such
Person the primary purpose or intent of which is to provide assurance to an
obligee that the obligation of the obligor thereof will be paid or discharged,
or any agreement relating thereto will be complied with, or the holders thereof
will be protected (in whole or in part) against loss in respect thereof; and
(ix) any liability of such Person for the obligation of another through any
agreement (contingent or otherwise) (a) to purchase, repurchase or otherwise
acquire such obligation or any security therefor, or to provide funds for the
payment or discharge of such obligation (whether in the form of loans,
advances, stock purchases, capital contributions or otherwise) or (b) to
maintain the solvency or any balance sheet item, level of income or financial
condition of another if, in the case of any agreement described under
subclauses (a) or (b) of this clause (ix), the primary purpose or intent
thereof is as described in clause (viii) above; and (x) Obligations of such
Person in respect of any exchange traded or over the counter derivative

 

 

transaction, including,
without limitation, any Interest Rate Agreement and Currency Agreement, whether
entered into for hedging or speculative purposes; provided, in no event
shall obligations under any Interest Rate Agreement and any Currency Agreement
be deemed “Indebtedness” for any purpose under Section 6.8.

 

“Indebtedness for Borrowed Money” means, to
the extent the following would be reflected on a consolidated balance sheet of
Holdings and its Subsidiaries prepared in accordance with GAAP, the principal
amount of all Indebtedness of Holdings and its Subsidiaries with respect to (i)
borrowed money, evidenced by debt securities, debentures, acceptances, notes or
other similar instruments, (ii) obligations under Capital Leases, (iii)
reimbursement obligations for letters of credit and financial guarantees
(without duplication), (other than ordinary course of business contingent
reimbursement obligations) or (iv) the deferred purchase price of property or
services (except for accounts payable and accrued expenses and receipt of
progress and advance payments related to such purchase price, in each case
arising in the ordinary course of business).

 

“Indemnified Liabilities” means,
collectively, any and all liabilities, obligations, losses, damages (including
natural resource damages), penalties, claims (including Environmental Claims),
costs (including the costs of any investigation, study, sampling, testing,
abatement, cleanup, removal, remediation or other response action necessary to
remove, remediate, clean up or abate any Hazardous Materials Activity),
expenses and disbursements of any kind or nature whatsoever (including the
reasonable fees and disbursements of counsel for Indemnitees in connection with
any investigative, administrative or judicial proceeding commenced or
threatened by any Person, whether or not any such Indemnitee shall be
designated as a party or a potential party thereto, and any fees or expenses
incurred by Indemnitees in enforcing this indemnity), whether direct, indirect
or consequential and whether based on any federal, state or foreign laws,
statutes, rules or regulations (including securities and commercial laws,
statutes, rules or regulations and Environmental Laws), on common law or equitable
cause or on contract or otherwise, that may be imposed on, incurred by, or
asserted against any such Indemnitee, in any manner relating to or arising out
of any action, judgment or suit in connection with (i) this Agreement or the
other Credit Documents or the transactions contemplated hereby or thereby
(including Lenders’ agreement to make Credit Extensions or the use or intended
use of the proceeds thereof, or any enforcement of any of the Credit Documents
(including any sale of, collection from, or other realization upon any of the
Collateral or the enforcement of the Guaranty)); (ii) the statements contained
in the commitment letter delivered by any Lender to Company or Sponsor with
respect to the transactions contemplated by this Agreement; or (iii) any
Environmental Claim or any Hazardous Materials Activity relating to or arising
from, directly or indirectly, any past or present activity, operation, land
ownership, or practice of Holdings or any of its Subsidiaries.

 

“Indemnitee” as defined in Section 10.3.

 

“Installment” as defined in Section
2.12(a).

 

 

“Installment Date” as defined in Section
2.12(a).

 

“Interest Coverage Ratio” means the ratio
as of the last day of any Fiscal Quarter of (i) Consolidated Adjusted EBITDA
for the four-Fiscal Quarter Period then ended, to (ii) Consolidated Cash
Interest Expense for such four-Fiscal Quarter Period, provided that the
foregoing shall be subject to the adjustments described in Schedule 1.1.

 

“Interest Payment Date” means with respect
to (i) any Base Rate Loan, each March 31, June 30, September 30 and December 31
of each year, commencing on the first such date to occur after the Closing Date
and the final maturity date of such Loan; and (ii) any Eurodollar Rate Loan,
the last day of each Interest Period applicable to such Loan; provided,
in the case of each Interest Period of longer than three months “Interest
Payment Date” shall also include each date that is three months, or an integral
multiple thereof, after the commencement of such Interest Period.

 

“Interest Period” means, in connection with
a Eurodollar Rate Loan, an interest period of one-, two-, three- or six-months,
(or, if generally available to all Lenders, nine-month or twelve-months) as
selected by Company in the applicable Funding Notice or Conversion/Continuation
Notice, (i) initially, commencing on the Credit Date or Conversion/Continuation
Date thereof, as the case may be; and (ii) thereafter, commencing on the day on
which the immediately preceding Interest Period expires; provided, (a) if
an Interest Period would otherwise expire on a day that is not a Business Day,
such Interest Period shall expire on the next succeeding Business Day unless no
further Business Day occurs in such month, in which case such Interest Period
shall expire on the immediately preceding Business Day; (b) any Interest Period
that begins on the last Business Day of a calendar month (or on a day for which
there is no numerically corresponding day in the calendar month at the end of
such Interest Period) shall end on the last Business Day of a calendar month;
(c) no Interest Period with respect to any portion of any Class of Term Loans
shall extend beyond such Class’s Term Loan Maturity Date; (d) no Interest
Period with respect to any portion of the Revolving Loans shall extend beyond
the Revolving Commitment Termination Date.

 

“Interest Rate Agreement” means any
interest rate swap agreement, interest rate cap agreement, interest rate collar
agreement, interest rate hedging agreement or other similar agreement or arrangement,
each of which is for the purpose of hedging the interest rate exposure
associated with Holdings’ and its Subsidiaries’ operations and not for
speculative purposes.

 

“Interest Rate Determination Date” means,
with respect to any Interest Period, the date that is two Business Days prior
to the first day of such Interest Period.

 

“Internal Revenue Code” means the Internal
Revenue Code of 1986, as amended to the date hereof and from time to time
hereafter, and any successor statute.

 

 

“Investment” means (i) any direct or
indirect purchase or other acquisition by Holdings or any of its Subsidiaries
of, or of a beneficial interest in, any of the Securities of any other Person
(other than Company or a Guarantor Subsidiary); and (ii) any direct or indirect
loan, advance (other than advances to employees in the ordinary course of
business) or capital contribution by Holdings or any of its Subsidiaries to any
other Person (other than Company or any Guarantor Subsidiary), including all
indebtedness and accounts receivable from that other Person that did not arise
from sales, leases or licenses to that other Person in the ordinary course of
business. The amount of any Investment shall be the original cost of such
Investment plus the cost of all additions thereto net of dividends and other
returns thereon to the extent distributed to the Company, without any
adjustments for increases or decreases in value, or write-ups, write-downs or
write-offs with respect to such Investment.

 

“Issuance Notice” means an Issuance Notice
substantially in the form of Exhibit A-3.

 

“Issuing Bank” means any one or more
Lenders the Company selects, and who consent, to act as an Issuing Bank
hereunder, each together with its permitted successors and assigns in such
capacity.

 

“Joint Venture” means a joint venture,
partnership or other similar arrangement, whether in corporate, partnership or
other legal form; provided, in no event shall any corporate Subsidiary
of any Person be considered to be a Joint Venture to which such Person is a party.

 

“Landlord Consent and Estoppel” means, with
respect to any Leasehold Property which is or becomes a Material Real Estate
Asset, a letter, certificate or other instrument in writing from the lessor
under the related lease, pursuant to which, among other things, the landlord
consents to the granting of a Mortgage on such Leasehold Property by the Credit
Party tenant, such Landlord Consent and Estoppel to be in form and substance
acceptable to the Collateral Agent in its reasonable discretion, but in any
event sufficient for the Collateral Agent to obtain a Title Policy with respect
to such Mortgage.

 

“Landlord Personal Property Collateral Access Agreement”
means, with respect to any Leasehold Property specified by Collateral Agent
where material personal property Collateral is located, a Landlord Waiver and
Consent Agreement substantially in the form of Exhibit K, with such amendments
or modifications as may be approved by Collateral Agent.

 

“Leasehold Property” means any leasehold
interest of any Credit Party as lessee under any lease of real property, other
than any such leasehold interest designated from time to time by Administrative
Agent in its sole discretion as not being required to be included in the
Collateral.

 

“Lender” means each financial institution
listed on the signature pages hereto as a Lender, and any other Person that
becomes a party hereto pursuant to an Assignment Agreement.

 

 

“Lender Counterparty” means each Lender or
any Affiliate of a Lender counterparty to a Hedge Agreement including, without
limitation, each such Affiliate that enters into a joinder agreement with the
Collateral Agent.

 

“Letter of Credit” means a commercial or
standby letter of credit issued or to be issued by Issuing Bank pursuant to
this Agreement.

 

“Letter of Credit Sublimit” means the
lesser of (i) $25,000,000 and (ii) the aggregate unused amount of the Revolving
Commitments then in effect.

 

“Letter of Credit Usage” means, as at any
date of determination, the sum of (i) the maximum aggregate amount which is, or
at any time thereafter may become, available for drawing under all Letters of
Credit then outstanding, and (ii) the aggregate amount of all drawings under
Letters of Credit honored by Issuing Bank and not theretofore reimbursed by or
on behalf of Company (through a Revolving Loan or otherwise).

 

“Leverage Ratio” means the ratio as of the
last day of any Fiscal Quarter of (i) Consolidated Total Debt as of such day to
(ii) Consolidated Adjusted EBITDA for the four-Fiscal Quarter period ending on
such date.

 

“Lien” means any lien, mortgage, deed of
trust, pledge, assignment, security interest, charge or encumbrance of any kind
(including any agreement to give any of the foregoing, any conditional sale or
other title retention agreement, and any lease in the nature thereof) and any
option, trust or other preferential arrangement having the practical effect of
any of the foregoing.

 

“Loan” means a Tranche A Term Loan, a
Tranche B Term Loan, a Tranche C Term Loan, a Revolving Loan or a Swing Line
Loan.

 

“Management Agreement” means the agreement
between the Company and TC Group, L.L.C. as in effect on the Closing Date, with
such changes therein as are approved by the Administrative Agent from time to
time.

 

“Margin Stock” as defined in Regulation U
of the Board of Governors of the Federal Reserve System as in effect from time
to time.

 

“Material Adverse Effect” means a material
adverse effect on (i) the business, operations, properties, assets, or
financial condition of Holdings and its Subsidiaries, taken as a whole
including, for any periods prior to the Closing Date, the Acquired Business;
(ii) the ability of any Credit Party to fully and timely perform its material
Obligations; (iii) the legality, validity, binding effect or enforceability
against a Credit Party of a Credit Document to which it is a party;

 

 

or (iv) the rights,
remedies and benefits as a whole available to, or conferred upon, any Agent, or
any Secured Party under any Credit Document.

 

“Material Real Estate Asset’’means (a) any
fee-owned Real Estate Asset having a fair market value in excess of $5,000,000
as of the date of the acquisition thereof and (b) all Leasehold Properties
other than those with respect to which the aggregate payments under the term of
the lease are less than $1,500,000 per annum that the Administrative Agent has
determined is material to the business, operations, properties, assets or
financial condition of Holdings or any Subsidiary thereof, including Company.

 

“Moody’s” means Moody’s Investor Services,
Inc.

 

“Mortgage” means a mortgage, leasehold
mortgage, deed of trust or similar instrument substantially in the form of
Exhibit J, delivered by a Credit Party as it may be amended, supplemented or
otherwise modified from time to time.

 

“Multiemployer Plan” means any Employee
Benefit Plan which is a “multiemployer plan” as defined in Section 3(37) of
ERISA.

 

“NAIC” means The National Association of
Insurance Commissioners, and any successor thereto.

 

“Narrative Report” means, with respect to
the financial statements for which such narrative report is required, a
narrative report describing the operations of Holdings and its Subsidiaries in
the form prepared for presentation to senior management thereof for the
applicable Fiscal Year.

 

“Net Asset Sale Proceeds” means, with respect
to any Asset Sale, an amount equal to: 
(i) Cash payments (including any Cash received by way of deferred
payment pursuant to, or by monetization of, a note receivable or otherwise, but
only as and when so received) received by Holdings or any of its Subsidiaries
from such Asset Sale, minus (ii) any bona fide fees, costs and expenses
incurred in connection with such Asset Sale, including (a) income or gains
taxes payable by the seller as a result of any gain recognized in connection
with such Asset Sale, (b) payment of the outstanding principal amount of,
premium or penalty, if any, and interest on any Indebtedness (other than the
Loans) that is secured by a Lien on the stock or assets in question and that is
required to be repaid under the terms thereof as a result of such Asset Sale
and (c) a reasonable reserve for any indemnification payments (fixed or
contingent) attributable to seller’s indemnities and representations and
warranties to purchaser in respect of such Asset Sale undertaken by Holdings or
any of its Subsidiaries in connection with such Asset Sale.

 

“Net Insurance/Condemnation Proceeds” means
an amount equal to:  (i) any Cash
payments or proceeds received by Holdings or any of its Subsidiaries (a) under
any casualty insurance policy in respect of a covered loss thereunder or (b) as
a result of the taking of any

 

 

assets of Holdings or any
of its Subsidiaries by any Person pursuant to the power of eminent domain,
condemnation or otherwise, or pursuant to a sale of any such assets to a purchaser
with such power under threat of such a taking, minus (ii) (a) any bona
fide fees, costs and expenses incurred by Holdings or any of its Subsidiaries
in connection with the adjustment or settlement of any claims of Holdings or
such Subsidiary in respect thereof, or incurred in connection with any sale of
such assets as referred to in clause (i)(b) of this definition, including
income taxes payable as a result of any gain recognized in connection
therewith, (b) payment of the outstanding principal amount of, premium or
penalty, if any, and interest on any Indebtedness (other than the Loans) that
is secured by a Lien on the assets in question and that is required to be
repaid under the terms thereof as a result of such sales, claims or covered
losses and (c) a reasonable reserve for any indemnification payments (fixed or
contingent) attributable to indemnities and representations and warranties in
respect of such sales, claims or covered losses undertaken by Holdings or any
of its Subsidiaries in connection with such claims or covered losses.

 

“Non-US Lender” as defined in Section
2.20(c).

 

“Note” means a Tranche A Term Note, a
Tranche B Term Note, a Tranche C Term Note, a Revolving Loan Note or a Swing
Line Note.

 

“Notice” means a Funding Notice, an Issuance
Notice or a Conversion/Continuation Notice.

 

“Obligations” means all obligations of
every nature of each Credit Party from time to time owed to the Agents
(including former Agents), the Lenders or any of them and Lender
Counterparties), under any Credit Document or Hedge Agreement entered into with
a Lender Counterparty (including, without limitation, with respect to a Hedge
Agreement, obligations owed thereunder to any person who was a Lender or an
Affiliate of a Lender at the time such Hedge Agreement was entered into),
whether for principal, interest (including interest which, but for the filing
of a petition in bankruptcy with respect to such Credit Party, would have
accrued on any Obligation, whether or not a claim is allowed against such
Credit Party for such interest in the related bankruptcy proceeding),
reimbursement of amounts drawn under Letters of Credit, payments for early
termination of Hedge Agreements entered into with a Lender Counterparty, fees,
expenses, indemnification or otherwise.

 

“Obligee Guarantor” as defined in Section
7.7.

 

“Organizational Documents” means (i) with
respect to any corporation, its certificate or articles of incorporation, as
amended, and its by-laws, as amended, (ii) with respect to any limited
partnership, its certificate of limited partnership, as amended, and its
partnership agreement, as amended, (iii) with respect to any general
partnership, its partnership agreement, as amended, and (iv) with respect to
any limited liability company, its articles of organization, as amended, and
its operating agreement, as amended.  In
the event any term or condition of this Agreement or any other Credit Document
requires any Organizational Document to be certified

 

 

by a secretary of state
or similar governmental official, the reference to any such “Organizational
Document” shall only be to a document of a type customarily certified by such
governmental official.

 

“PBGC” means the Pension Benefit Guaranty
Corporation or any successor thereto.

 

“Pension Plan” means any Employee Benefit
Plan, other than a Multiemployer Plan, which is subject to Section 412 of the
Internal Revenue Code or Section 302 of ERISA.

 

“Permitted Acquisition” means any
acquisition by Company or any of its Subsidiaries, whether by purchase, merger
or otherwise, of all or substantially all of the assets of, or the portion of
the Capital Stock specified below of, or a business line or unit or a division
of, any Person; provided,

 

(i)                                     immediately
prior to, and after giving effect thereto, no Default or Event of Default shall
have occurred and be continuing or would result therefrom;

 

(ii)                                  all
transactions in connection therewith shall be consummated, in all material
respects, in accordance with all applicable laws and in conformity with all
necessary Governmental Authorizations;

 

(iii)                               in
the case of the acquisition of Capital Stock, at least 90% of the Capital Stock
(except for any such Securities in the nature of directors’ qualifying shares
required pursuant to applicable law) acquired or otherwise issued by such
Person or any newly formed Subsidiary of Company in connection with such
acquisition shall be owned by Company or a Guarantor Subsidiary thereof, and
Company shall have taken, or caused to be taken, as of the date such Person
becomes a Subsidiary of Company, each of the actions set forth in Sections 5.10
and/or 5.11, as applicable;

 

(iv)                              Holdings
and its Subsidiaries shall be in compliance, on a pro forma basis after giving
effect to such acquisition as of the last day of the Fiscal Quarter most recently
ended, with Section 6.8 (as determined in accordance with Section 6.8(e));

 

(v)                                 Company
shall have delivered to Administrative Agent (A) at least three Business Days
prior to such proposed acquisition, a Compliance Certificate evidencing
compliance with Section 6.8 as required under clause (iv) above, together with
all relevant financial information with respect to such acquired assets,
including, without limitation, the aggregate consideration for such acquisition
and any other information required to demonstrate compliance with Section 6.8;
and

 

(vi)                              any
Person or assets or division as acquired in accordance herewith shall be in
same or related business or lines of business or reasonable extensions thereof
in which Company and/or its Subsidiaries are engaged as of the Closing Date.

 

 

“Permitted Investor” means management
investors and other co-investors or Affiliates of Sponsor.

 

“Permitted Liens” means each of the Liens
permitted pursuant to Section 6.2.

 

“Permitted Seller Note” means a promissory
note containing subordination and other provisions reasonably acceptable to
Administrative Agent, representing Indebtedness of Holdings or Company incurred
in connection with any Permitted Acquisition and payable to the seller in
connection therewith, provided that, no Permitted Seller Note shall (i)
be guaranteed by any Subsidiary of Company or secured by any property of
Holdings, Company or any of its Subsidiaries, (ii) provide for payment of cash
interest; prior to the maturity of the Loans, (iii) provide for any prepayment
or repayment of all or any portion of the principal thereof prior to the
earlier of (A) a date occurring six months following the final scheduled
installment of principal of the Loans and (B) the repayment in full of the
Obligations and (iv) include a cross-default to this Agreement.

 

“Person” means and includes natural
persons, corporations, limited partnerships, general partnerships, limited
liability companies, limited liability partnerships, joint stock companies,
Joint Ventures, associations, companies, trusts, banks, trust companies, land
trusts, business trusts or other organizations, whether or not legal entities,
and Governmental Authorities.

 

“Pledge and Security Agreement” means the
Pledge and Security Agreement to be executed by Company and each Guarantor
substantially in the form of Exhibit I, as it may be amended, supplemented or
otherwise modified from time to time.

 

“Post Closing Date Mortgaged Property” as
defined in Section 5.14(b).

 

“Prime Rate” means the rate of interest per
annum that Deutsche Bank A.G.  announces
from time to time as its prime lending rate, as in effect from time to
time.  The Prime Rate is a reference
rate and does not necessarily represent the lowest or best rate actually
charged to any customer.  Any Lender may
make commercial loans or other loans at rates of interest at, above or below
the Prime Rate.

 

“Principal Office” means, for each of
Administrative Agent, Swing Line Lender and Issuing Bank, such Person’s
“Principal Office” as set forth on Appendix B, or such other office as such
Person may from time to time designate in writing to Company, Administrative
Agent and each Lender.

 

“Projections” as defined in Section 4.8.

 

“Pro Rata Share” means (i) with respect to
all payments, computations and

 

 

other matters relating to
the Tranche A Term Loan of any Lender, the percentage obtained by dividing (a)
the Tranche A Term Loan Exposure of that Lender by (b) the aggregate Tranche A
Term Loan Exposure of all Lenders; (ii) with respect to all payments,
computations and other matters relating to the Tranche B Term Loan of any
Lender, the percentage obtained by dividing (a) the Tranche B Term Loan
Exposure of that Lender by (b) the aggregate Tranche B Term Loan Exposure of
all Lenders; (iii ) with respect to all payments, computations and other
matters relating to the Tranche C Term Loan of any Lender, the percentage
obtained by dividing (a) the Tranche C Term Loan Exposure of that Lender by (b)
the aggregate Tranche C Term Loan Exposure of all Lenders; and  (iv) with respect to all payments,
computations and other matters relating to the Revolving Commitment or
Revolving Loans of any Lender or any Letters of Credit issued or participations
purchased therein by any Lender or any participations in any Swing Line Loans
purchased by any Lender, the percentage obtained by dividing (a) the Revolving
Exposure of that Lender by (b) the aggregate Revolving Exposure of all
Lenders.  For all other purposes with
respect to each Lender, “Pro Rata Share” means the percentage obtained by
dividing (A) an amount equal to the sum of the Tranche A Term Loan Exposure,
the Tranche B Term Loan Exposure, the Tranche C Term Loan Exposure, and the
Revolving Exposure of that Lender, by (B) an amount equal to the sum of the
aggregate Tranche A Term Loan Exposure, the aggregate Tranche B Term Loan
Exposure, the aggregate Tranche C Term Loan Exposure, and the aggregate
Revolving Exposure.

 

“Real Estate Asset” means, at any time of
determination, any interest (fee, leasehold or otherwise) then owned by any
Credit Party in any real property.

 

“Record Document” means, with respect to
any Leasehold Property, (i) the lease evidencing such Leasehold Property or a
memorandum thereof, executed and acknowledged by the owner of the affected real
property, as lessor, or (ii) if such Leasehold Property was acquired or
subleased from the holder of a Recorded Leasehold Interest, the applicable
assignment or sublease document, executed and acknowledged by such holder, in
each case in form sufficient to give such constructive notice upon recordation
and otherwise in form reasonably satisfactory to Collateral Agent.

 

“Recorded Leasehold Interest” means a
Leasehold Property with respect to which a Record Document has been recorded in
all places necessary or desirable, in Collateral Agent’s reasonable judgment,
to give constructive notice of such Leasehold Property to third-party
purchasers and encumbrancers of the affected real property.

 

“Refunded Swing Line Loans” as defined in
Section 2.3(b)(v).

 

“Register” as defined in Section 2.7(b).

 

“Regulation D” means Regulation D of the
Board of Governors of the Federal Reserve System, as in effect from time to
time.

 

 

“Reimbursement Date” as defined in Section
2.4(d).

 

“Related Agreements” means, collectively,
the Acquisition Agreement and Holdings Notes.

 

“Related Fund” means, with respect to any
Lender that is an investment fund, any other investment fund that invests in
commercial loans and that is managed or advised by the same investment advisor
as such Lender or by an Affiliate of such investment advisor.

 

“Release” means any release, spill,
emission, leaking, pumping, pouring, injection, escaping, deposit, disposal,
discharge, dispersal, dumping, leaching or migration of any Hazardous Material
into the indoor or outdoor environment (including the abandonment or disposal
of any barrels, containers or other closed receptacles containing any Hazardous
Material).

 

“Replacement Lender” as defined in Section
2.22.

 

“Required Prepayment Date” as defined in
Section 2.15(c).

 

“Requisite Class Lenders” means, at any
time of determination as applicable, (i) for the Class of Lenders having
Tranche A Term Loan Exposure, Lenders holding more than 50% of the aggregate
Tranche A Term Loan Exposure of all Lenders; (ii) for the Class of Lenders
having Tranche B Term Loan Exposure, Lenders holding more than 50% of the
aggregate Tranche B Term Loan Exposure of all Lenders; (iii) for the Class of
Lenders having Tranche C Term Loan Exposure, Lenders holding more than 50% of
the aggregate Tranche C Term Loan Exposure of all Lenders; and (iv) for the
Class of Lenders having Revolving Exposure, Lenders holding more than 50% of
the aggregate Revolving Exposure of all Lenders.

 

“Requisite Lenders” means one or more
Lenders having or holding Tranche A Term Loan Exposure, Tranche B Term Loan
Exposure, Tranche C Term Loan Exposure, and/or Revolving Exposure and
representing more than 50% of the sum of (i) the aggregate Tranche A Term Loan
Exposure of all Lenders, (ii) the aggregate Tranche B Term Loan Exposure of all
Lenders, (iii) the aggregate Tranche C Term Loan Exposure of all Lenders, and
(iv) the aggregate Revolving Exposure of all Lenders.

 

“Restricted Junior Payment” means (i) any
dividend or other distribution (other than to Company or any of its
Subsidiaries), direct or indirect, on account of any shares of any class of
stock of Holdings, Company or any of its Subsidiaries now or hereafter
outstanding, except a dividend payable solely in shares of that class of stock
to the holders of that class; (ii) any redemption, retirement, sinking fund or
similar payment, purchase or other acquisition for value, direct or indirect,
(other than to Company or any of its Subsidiaries) of any shares of any class
of stock of Holdings, Company or any of its Subsidiaries now or hereafter
outstanding; (iii) any payment (other than to Company or any of its
Subsidiaries) made to retire, or to obtain

 

 

the surrender of, any
outstanding warrants, options or other rights to acquire shares of any class of
stock of Holdings, Company or any of its Subsidiaries now or hereafter
outstanding; (iv) any management or advisory fees paid by a Credit Party to
Sponsor or its Affiliates after the Closing Date, and (v) any payment or
prepayment of principal of, premium, if any, or interest on, or redemption,
purchase, retirement, defeasance (including in-substance or legal defeasance),
sinking fund or similar payment with respect to, the Holdings Notes or
Permitted Seller Notes.

 

“Revolving Commitment” means the commitment
of a Lender to make or otherwise fund any Revolving Loan and to acquire
participations in Letters of Credit and Swing Line Loans hereunder and “Revolving
Commitments” means such commitments of all Lenders in the
aggregate.  The amount of each Lender’s Revolving
Commitment, if any, is set forth on Appendix A-3 or in the applicable
Assignment Agreement, subject to any adjustment or reduction pursuant to the
terms and conditions hereof.  The
aggregate amount of the Revolving Commitments as of the Closing Date is
$125,000,000.

 

“Revolving Commitment Period” means the
period from the Closing Date to but excluding the Revolving Commitment
Termination Date.

 

“Revolving Commitment Termination Date”
means the earliest to occur of  (i) July
31, 2000, if the Term Loans are not made on or before that date; (ii) June 30,
2006, (iii) the date the Revolving Commitments are permanently reduced to zero
pursuant to Section 2.13(b) or 2.14, and (iv) the date of the termination of
the Revolving Commitments pursuant to Section 8.1.

 

“Revolving Exposure” means, with respect to
any Lender as of any date of determination, (i) prior to the termination of the
Revolving Commitments, that Lender’s Revolving Commitment; and (ii) after the
termination of the Revolving Commitments, the sum of (a) the aggregate
outstanding principal amount of the Revolving Loans of that Lender, (b) in the
case of Issuing Bank, the aggregate Letter of Credit Usage in respect of all
Letters of Credit issued by that Lender (net of any participations by Lenders
in such Letters of Credit), (c) the aggregate amount of all participations by
that Lender in any outstanding Letters of Credit or any unreimbursed drawing
under any Letter of Credit, (d) in the case of Swing Line Lender, the aggregate
outstanding principal amount of all Swing Line Loans (net of any participations
therein by other Lenders), and (e) the aggregate amount of all participations
therein by that Lender in any outstanding Swing Line Loans.

 

“Revolving Loan” means a Loan made by a
Lender to Company pursuant to Section 2.2(a) and/or 2.22.

 

“Revolving Loan Note” means a promissory
note in the form of Exhibit B-4, as it may be amended, supplemented or
otherwise modified from time to time.

 

“S&P” means Standard & Poor’s
Ratings Group, a division of The McGraw Hill Corporation.

 

 

“Seller” means Northrop Grumman
Corporation.

 

“Secured Parties” has the meaning assigned
to that term in the Pledge and Security Agreement.

 

“Securities” means any stock, shares,
partnership interests, voting trust certificates, certificates of interest or
participation in any profit-sharing agreement or arrangement (other than any
such agreement or arrangement entered into with a customer or supplier in the
ordinary course of business), options, warrants, bonds, debentures, notes, or
other evidences of indebtedness, secured or unsecured, convertible,
subordinated or otherwise, or in general any instruments commonly known as
“securities” or any certificates of interest, shares or participations in
temporary or interim certificates for the purchase or acquisition of, or any
right to subscribe to, purchase or acquire, any of the foregoing.

 

“Securities Act” means the Securities Act
of 1933, as amended from time to time, and any successor statute.

 

“Solvency Certificate” means a Solvency
Certificate of the chief financial officer of Holdings substantially in the
form of Exhibit G-2.

 

“Solvent” means, with respect to any
Person, that as of the date of determination both (i) (a) the sum of such
Person’s debt (including contingent liabilities) does not exceed all of its
property, at a fair valuation; (b) the present fair saleable value of the
property of such Person is not less than the amount that will be required to
pay the probable liabilities on such Person’s then existing debts as they
become absolute and matured; (c) such Person’s capital is not unreasonably
small in relation to its business or any contemplated or undertaken
transaction; and (d) such Person does not intend to incur, or believe (nor
should it reasonably believe) that it will incur, debts beyond its ability to
pay such debts as they become due; and (ii) such Person is “solvent” within the
meaning given that term and similar terms under applicable laws relating to
fraudulent transfers and conveyances. 
For purposes of this definition, the amount of any contingent liability
at any time shall be computed as the amount that, in light of all of the facts
and circumstances existing at such time, represents the amount that can
reasonably be expected to become an actual or matured liability (irrespective
of whether such contingent liabilities meet the criteria for accrual under
Statement of Financial Accounting Standard No. 5).

 

“Sponsor” means TC Group, L.L.C., d/b/a The
Carlyle Group.

 

“Subject Transaction” as defined in Section
6.8(e).

 

“Subsidiary” means, with respect to any
Person, any corporation, partnership, limited liability company, association,
joint venture or other business entity of which more than

 

 

50% of the total voting
power of shares of stock or other ownership interests entitled (without regard
to the occurrence of any contingency) to vote in the election of the Person or
Persons (whether directors, managers, trustees or other Persons performing
similar functions) having the power to direct or cause the direction of the
management and policies thereof is at the time owned or controlled, directly or
indirectly, by that Person or one or more of the other Subsidiaries of that
Person or a combination thereof; provided, in determining the percentage
of ownership interests of any Person controlled by another Person, no ownership
interest in the nature of a “qualifying share” of the former Person shall be
deemed to be outstanding.

 

“Swing Line Lender” means LCP in its
capacity as Swing Line Lender hereunder (and each other Lender who has agreed
to become a Swing Line Lender at Company’s request), together with its
permitted successors and assigns in such capacity.

 

“Swing Line Loan” means a Loan made by
Swing Line Lender to Company pursuant to Section 2.3.

 

“Swing Line Note” means a promissory note
in the form of Exhibit B-5, as it may be amended, supplemented or otherwise
modified from time to time.

 

“Swing Line Sublimit” means the lesser of
(i) $20,000,000, and (ii) the aggregate unused amount of Revolving Commitments
then in effect.

 

“Syndication Agent” as defined in the
preamble hereto.

 

“Tax” means any present or future tax,
levy, impost, duty, assessment, charge, fee, deduction or withholding of any
nature and whatever called, by whomsoever, on whomsoever and wherever imposed,
levied, collected, withheld or assessed; provided, “Tax on the overall
net income” of a Person shall be construed as a reference to a tax imposed by
the jurisdiction in which that Person is organized or in which that Person’s
applicable principal office (and/or, in the case of a Lender, its lending
office) is located or in which that Person (and/or, in the case of a Lender,
its lending office) is deemed to be doing business on all or part of the net
income, profits or gains (whether worldwide, or only insofar as such income,
profits or gains are considered to arise in or to relate to a particular
jurisdiction, or otherwise) of that Person (and/or, in the case of a Lender,
its applicable lending office).

 

“Term Loan” means a Tranche A Term Loan, a
Tranche B Term Loan or a Tranche C Term Loan.

 

“Term Loan Commitment” means the Tranche A
Term Loan Commitment, the Tranche B Term Loan Commitment or the Tranche C Term
Loan Commitment of a Lender, and or “Term Loan Commitments” means such
commitments of all Lenders in the aggregate.

 

“Term Loan Maturity Date” means the Tranche
A Term Loan Maturity Date,

 

 

the Tranche B Term Loan
Maturity Date or the Tranche C Term Loan Maturity Date, as applicable.

 

“Terminated Lender” as defined in Section
2.22.

 

“Total Utilization of Revolving Commitments”
means, as at any date of determination, the sum of (i) the aggregate principal
amount of all outstanding Revolving Loans (other than Revolving Loans made for
the purpose of repaying any Refunded Swing Line Loans or reimbursing Issuing
Bank for any amount drawn under any Letter of Credit, but not yet so applied),
(ii) the aggregate principal amount of all outstanding Swing Line Loans, and
(iii) the Letter of Credit Usage.

 

“Tranche A Term Loan” means a Tranche A Term
Loan made by a Lender to Company pursuant to Section 2.1(a)(i).

 

“Tranche A Term Loan Commitment” means the
commitment of a Lender to make or otherwise fund a Tranche A Term Loan and “Tranche A
Term Loan Commitments” means such commitments of all Lenders in the
aggregate.  The amount of each Lender’s
Tranche A Term Loan Commitment, if any, is set forth on Appendix A-1 or in the
applicable Assignment Agreement, subject to any adjustment or reduction
pursuant to the terms hereof.  The
aggregate amount of the Tranche A Term Loan Commitments as of the Closing Date
is $175,000,000.

 

“Tranche A Term Loan Exposure” means, with
respect to any Lender, as of any date of determination, the outstanding
principal amount of the Tranche A Term Loans of such Lender; provided,
at any time prior to the making of the Tranche A Term Loans, the Tranche A Term
Loan Exposure of any Lender shall be equal to such Lender’s Tranche A Term Loan
Commitment.

 

“Tranche A Term Loan Maturity Date” means
the earlier of (i) the sixth anniversary of the Closing Date, and (ii) the date
that all Tranche A Term Loans shall become due and payable in full hereunder,
whether by acceleration or otherwise.

 

“Tranche A Term Loan Note” means a
promissory note in the form of Exhibit B-1, as it may be amended, supplemented
or otherwise modified from time to time.

 

“Tranche B Term Loan” means a Tranche B
Term Loan made by a Lender to Company pursuant to Section 2.1(a)(ii).

 

“Tranche B Term Loan Commitment” means the
commitment of a Lender to make or otherwise fund a Tranche B Term Loan and “Tranche B
Term Loan Commitments” means such commitments of all Lenders in the
aggregate.  The amount of each Lender’s
Tranche B Term Loan Commitment, if any, is set forth on Appendix A-2 or in the
applicable Assignment Agreement, subject to any adjustment or reduction
pursuant to the terms hereof.  The
aggregate

 

 

amount of the Tranche B
Term Loan Commitments as of the Closing Date is $200,000,000.

 

“Tranche B Term Loan Exposure” means, with
respect to any Lender, as of any date of determination, the outstanding
principal amount of the Tranche B Term Loans of such Lender; provided,
at any time prior to the making of the Tranche B Term Loans, the Tranche B Term
Loan Exposure of any Lender shall be equal to such Lender’s Tranche B Term Loan
Commitment.

 

“Tranche B Term Loan Maturity Date” means
the earlier of (i) the seventh anniversary of the Closing Date, and (ii) the
date that all Tranche B Term Loans shall become due and payable in full
hereunder, whether by acceleration or otherwise.

 

“Tranche B Term Loan Note” means a
promissory note in the form of Exhibit B-2, as it may be amended, supplemented
or otherwise modified from time to time.

 

“Tranche C Term Loan” means a Tranche C
Term Loan made by a Lender to Company pursuant to Section 2.1(a)(iii).

 

“Tranche C Term Loan Commitment” means the
commitment of a Lender to make or otherwise fund a Tranche C Term Loan and “Tranche C
Term Loan Commitments” means such commitments of all Lenders in the
aggregate.  The amount of each Lender’s
Tranche C Term Loan Commitment, if any, is set forth on Appendix A-3 or in the
applicable Assignment Agreement, subject to any adjustment or reduction
pursuant to the terms hereof.  The
aggregate amount of the Tranche C Term Loan Commitments as of the Closing Date
is $150,000,000.

 

“Tranche C Term Loan Exposure” means, with
respect to any Lender, as of any date of determination, the outstanding
principal amount of the Tranche C Term Loans of such Lender; provided,
at any time prior to the making of the Tranche C Term Loans, the Tranche C Term
Loan Exposure of any Lender shall be equal to such Lender’s Tranche C Term Loan
Commitment.

 

“Tranche C Term Loan Maturity Date” means
the earlier of (i) the eighth anniversary of the Closing Date, and (ii) the
date that all Tranche C Term Loans shall become due and payable in full
hereunder, whether by acceleration or otherwise.

 

“Tranche C Term Loan Note” means a
promissory note in the form of Exhibit B-3, as it may be amended, supplemented
or otherwise modified from time to time.

 

“Transaction Costs” means the fees, costs
and expenses payable by Holdings, Company or any of Company’s Subsidiaries no
later than 180 days after the Closing Date in connection with the transactions
contemplated by the Credit Documents and the Related Agreements.

 

“Type of Loan” means (i) with respect to
either Term Loans or Revolving Loans,

 

 

a Base Rate Loan or a
Eurodollar Rate Loan, and (ii) with respect to Swing Line Loans, a Base Rate
Loan.

 

“UCC” means the Uniform Commercial Code (or
any similar or equivalent legislation) as in effect in any applicable
jurisdiction.

 

“UCC Questionnaire” means a certificate in
form satisfactory to the Collateral Agent that provides information with
respect to the personal or mixed property of each Credit Party.

 

“Unadjusted Eurodollar Rate Component”
means that component of the interest costs to Company in respect of a
Eurodollar Rate Loan that is based upon the rate obtained pursuant to clause
(i) of the definition of Adjusted Eurodollar Rate.

 

“Waivable Mandatory Prepayment” as defined
in Section 2.15(c).

 

1.2.  Accounting Terms. 
Except as otherwise expressly provided herein, all accounting terms not
otherwise defined herein shall have the meanings assigned to them in conformity
with GAAP.  Financial statements and
other information required to be delivered by Holdings to Lenders pursuant to
Section 5.1(a), 5.1(b) and 5.1(c) shall be prepared in accordance with GAAP as
in effect at the time of such preparation (and delivered together with the
reconciliation statements provided for in Section 5.1(e), if applicable).  Subject to the foregoing, calculations in
connection with the definitions, covenants and other provisions hereof shall
utilize generally accepted GAAP accounting principles and policies in effect as
of the Closing Date; provided that if, as a result of any change after
the Closing Date in GAAP, any change in such accounting principles and policies
used in the preparation of such financial statements occurs, then, following
the request of the Company, or the Requisite Lenders, the parties hereto shall
negotiate in good faith modifications to the definitions, covenants and other
provisions of this Agreement relating to the financial covenant calculations
required to be made under this Agreement in order to reflect the impact and the
projected impact of such change on the consolidated financial position and
results of operations of Holdings and its Subsidiaries.

 

1.3.  Interpretation,
etc.  Any of the terms
defined herein may, unless the context otherwise requires, be used in the
singular or the plural, depending on the reference.  References herein to any Section, Appendix, Schedule or Exhibit
shall be to a Section, an Appendix, a Schedule or an Exhibit, as the case may
be, hereof unless otherwise specifically provided.  The use herein of the word “include” or “including”, when
following any general statement, term or matter, shall not be construed to
limit such statement, term or matter to the specific items or matters set forth
immediately following such word or to similar items or matters, whether or not
nonlimiting language (such as “without limitation” or “but not limited to” or
words of similar import) is used with reference thereto, but rather shall be
deemed to refer to all other items or matters that fall within the broadest
possible scope of such general statement, term or matter.

 

 

SECTION
2.                            LOANS
AND LETTERS OF CREDIT

 

2.1.  Term Loans.

 

(a)                                  Loan
Commitments.  Subject to the terms
and conditions hereof,

 

(i)                                     each
Lender severally agrees to make, on the Closing Date, a Tranche A Term Loan to
Company in an amount equal to such Lender’s Tranche A Term Loan Commitment;

 

(ii)                                  each
Lender severally agrees to make, on the Closing Date, a Tranche B Term Loan to
Company in an amount equal to such Lender’s Tranche B Term Loan Commitment; and

 

(iii)                               each Lender severally
agrees to make, on the Closing Date, a Tranche C Term Loan to Company in an
amount equal to such Lender’s Tranche C Term Loan Commitment.

 

Company may make only one borrowing under each of the Tranche A Term
Loan Commitments, Tranche B Term Loan Commitments and the Tranche C Term Loan
Commitment which shall be on the Closing Date. 
Any amount borrowed under this Section 2.1(a) and subsequently repaid or
prepaid may not be reborrowed.  Subject
to Sections 2.13(a) and 2.14, all amounts owed hereunder with respect to the
Tranche A Term Loans, the Tranche B Term Loans and the Tranche C Term Loan
shall be paid in full no later than the Tranche A Term Loan Maturity Date, the Tranche
B Term Loan Maturity Date and the Tranche C Term Loan Maturity Date,
respectively.  Each Lender’s Tranche A
Term Loan Commitment, Tranche B Term Loan Commitment and Tranche C Term Loan
Commitment shall terminate immediately and without further action on the
Closing Date after giving effect to the funding of such Lender’s Tranche A Term
Loan Commitment, Tranche B Term Loan Commitment and Tranche C Term Loan
Commitment on such date.

 

(b)                                 Borrowing
Mechanics for Term Loans.

 

(i)                                     Company
shall deliver to Administrative Agent a fully executed and delivered Closing
Date Certificate (which shall be deemed to be a Funding Notice with respect to
the Term Loans for all purposes hereof) no later than the Closing Date.  Promptly upon receipt by Administrative Agent
of such Certificate, Administrative Agent shall notify each Lender of the
proposed borrowing.

 

(ii)                                  Each
Lender shall make its Tranche A Term Loan, Tranche B Term Loan and/or Tranche C
Term Loan, as the case may be, available to Administrative Agent not later than
12:00 p.m. (New York City time) on the Closing Date, by wire transfer of same
day

 

 

funds in Dollars, at
Administrative Agent’s Principal Office. 
Upon satisfaction or waiver of the conditions precedent specified
herein, Administrative Agent shall make the proceeds of the Term Loans
available to Company on the Closing Date by causing an amount of same day funds
in Dollars equal to the proceeds of all such Loans received by Administrative
Agent from Lenders to be credited to the account of Company at Administrative
Agent’s Principal Office or to such other account as may be designated in
writing to Administrative Agent by Company.

 

2.2.  Revolving Loans.

 

(a)                                  Revolving
Commitments.  During the Revolving
Commitment Period, subject to the terms and conditions hereof, each Lender
severally agrees to make Revolving Loans to Company in the aggregate amount up
to but not exceeding such Lender’s Revolving Commitment; provided, after
giving effect to the making of any Revolving Loans in no event shall the Total
Utilization of Revolving Commitments exceed the Revolving Commitments then in
effect.  Amounts borrowed pursuant to
this Section 2.2(a) may be repaid and reborrowed during the Revolving
Commitment Period; provided  further, in no event shall outstanding
Revolving Loans plus the aggregate principal amount of outstanding Swing
Line Loans exceed $100,000,000 at any time. 
Each Lender’s Revolving Commitment shall expire on the Revolving
Commitment Termination Date and all Revolving Loans and all other amounts owed
hereunder with respect to the Revolving Loans and the Revolving Commitments
shall be paid in full no later than such date.

 

(b)                                 Borrowing
Mechanics for Revolving Loans.

 

(i)                                     Except
pursuant to 2.4(d), Revolving Loans that are Base Rate Loans shall be made in
an aggregate minimum amount of $250,000, and Revolving Loans that are
Eurodollar Rate Loans shall be in an aggregate minimum amount of  $1,000,000.

 

(ii)                                  Whenever
Company desires that Lenders make Revolving Loans, Company shall deliver to Administrative
Agent a fully executed and delivered Funding Notice no later than noon  (New
York City time) at least three Business Days in advance of the proposed Credit
Date in the case of a Eurodollar Rate Loan, and at least one Business Day in
advance of the proposed Credit Date in the case of a Revolving Loan that is a
Base Rate Loan.  Except as otherwise
provided herein, a Funding Notice for a Revolving Loan that is a Eurodollar
Rate Loan shall be irrevocable on and after the related Interest Rate Determination
Date, and Company shall be bound to make a borrowing in accordance therewith.

 

(iii)                               Notice of receipt of
each Funding Notice in respect of Revolving Loans, together with the amount of
each Lender’s Pro Rata Share thereof, if any, together with the applicable
interest rate, shall be provided by Administrative Agent to each applicable
Lender by telefacsimile with reasonable promptness, but (provided
Administrative Agent shall have received such notice by noon (New York City
time)) not later than 3:00  p.m. (New York City time) on the same day
as Administrative Agent’s receipt of such Notice from Company.

 

 

(iv)                              Each
Lender shall make the amount of its Revolving Loan available to Administrative
Agent not later than 12:00 p.m. (New York City time) on the applicable Credit
Date by wire transfer of same day funds in Dollars, at the Administrative
Agent’s Principal Office.  Except as
provided herein, upon satisfaction or waiver of the conditions precedent
specified herein, Administrative Agent shall make the proceeds of such
Revolving Loans available to Company on the applicable Credit Date by causing
an amount of same day funds in Dollars equal to the proceeds of all such
Revolving Loans received by Administrative Agent from Lenders to be credited to
the account of Company at the Administrative Agent’s Principal Office or such
other account as may be designated in writing to Administrative Agent by
Company.

 

2.3.  Swing Line Loans.

 

(a)                                  Swing
Line Loans Commitments.  During the
Revolving Commitment Period, subject to the terms and conditions hereof, Swing
Line Lender hereby agrees to make Swing Line Loans to Company in the aggregate
amount up to but not exceeding the Swing Line Sublimit; provided, after
giving effect to the making of any Swing Line Loan, in no event shall the Total
Utilization of Revolving Commitments exceed the Revolving Commitments then in
effect; provided  further, in no event shall the aggregate
principal amount of outstanding Revolving Loans plus the outstanding
principal amount of Swing Line Loans exceed $100,000,000 at any time.  Amounts borrowed pursuant to this Section
2.3 may be repaid and reborrowed during the Revolving Commitment Period.  Swing Line Lender’s Revolving Commitment
shall expire on the Revolving Commitment Termination Date and all Swing Line
Loans and all other amounts owed hereunder with respect to the Swing Line Loans
and the Revolving Commitments shall be paid in full no later than such date.

 

(b)                                 Borrowing
Mechanics for Swing Line Loans.

 

(i)                                     Swing
Line Loans shall be made in an aggregate minimum amount of $250,000.

 

(ii)                                  Whenever
Company desires that Swing Line Lender make a Swing Line Loan, Company shall
deliver to Administrative Agent a Funding Notice no later than 1:00 p.m. (New
York City time) on the proposed Credit Date.

 

(iii)                               Swing Line Lender shall
make the amount of its Swing Line Loan available to Administrative Agent not
later than 3:00 p.m.(New York City time) on the applicable Credit Date by wire
transfer of same day funds in Dollars, at the Administrative Agent’s Principal
Office.  Except as provided herein, upon
satisfaction or waiver of the conditions precedent specified herein,
Administrative Agent shall make the proceeds of such Swing Line Loans available
to Company on the applicable Credit Date by causing an amount of same day funds
in Dollars equal to the proceeds of all such Swing Line Loans received by
Administrative Agent from Swing Line Lender to be credited to the account of
Company at the

 

 

Administrative Agent’s
Principal Office, or to such other account as may be designated in writing to
Administrative Agent by Company.

 

(iv)                              With
respect to any Swing Line Loans which have not been voluntarily prepaid by
Company pursuant to Section 2.13, Swing Line Lender may at any time in its sole
and absolute discretion, deliver to Administrative Agent (with a copy to
Company), no later than 11:00 a.m. (New York City time) at least one (1)
Business Day in advance of the proposed Credit Date, a notice (which shall be
deemed to be a Funding Notice given by Company) requesting that each Lender
holding a Revolving Commitment make Revolving Loans that are Base Rate Loans to
Company on such Credit Date in an amount equal to the amount of such Swing Line
Loans (the “Refunded Swing Line Loans”) outstanding on the date such
notice is given which the Swing Line Lender requests Lenders to prepay.  Anything contained in this Agreement to the
contrary notwithstanding, (1) the proceeds of such Revolving Loans made by the
Lenders other than Swing Line Lender shall be immediately delivered by the
Administrative Agent to Swing Line Lender (and not to Company) and applied to
repay a corresponding portion of the Refunded Swing Line Loans and (2) on the
day such Revolving Loans are made, Swing Line Lender’s Pro Rata Share of the
Refunded Swing Line Loans shall be deemed to be paid with the proceeds of a
Revolving Loan made by Swing Line Lender to Company, and such portion of the
Swing Line Loans deemed to be so paid shall no longer be outstanding as Swing
Line Loans and shall no longer be due under the Swing Line Note of Swing Line
Lender but shall instead constitute part of Swing Line Lender’s outstanding
Revolving Loans to Company and shall be due under the Revolving Loan Note
issued by Company to Swing Line Lender. 
If any portion of any such amount paid (or deemed to be paid) to Swing
Line Lender should be recovered by or on behalf of Company from Swing Line
Lender in bankruptcy, by assignment for the benefit of creditors or otherwise,
the loss of the amount so recovered shall be ratably shared among all Lenders
in the manner contemplated by Section 2.17.

 

(v)                                 If
for any reason Revolving Loans are not made pursuant to Section 2.3(b)(iv) in
an amount sufficient to repay any amounts owed to Swing Line Lender in respect
of any outstanding Swing Line Loans on or before the third Business Day after
demand for payment thereof by Swing Line Lender, each Lender holding a
Revolving Commitment shall be deemed to, and hereby agrees to, have purchased a
participation in such outstanding Swing Line Loans, and in an amount equal to
its Pro Rata Share of the applicable unpaid amount together with accrued
interest thereon.  Upon one (1) Business
Day’s notice from Swing Line Lender, each Lender holding a Revolving Commitment
shall deliver to Swing Line Lender an amount equal to its respective
participation in the applicable unpaid amount in same day funds at the
Principal Office of Swing Line Lender. In order to evidence such participation
each Lender holding a Revolving Commitment agrees to enter into a participation
agreement at the request of Swing Line Lender in form and substance reasonably
satisfactory to Swing Line Lender.  In
the event any Lender holding a Revolving Commitment fails to make available to
Swing Line Lender the amount of such Lender’s participation as provided in this
paragraph, Swing Line Lender shall be entitled to recover such amount on demand
from such Lender together with interest thereon for three Business Days at the
rate customarily used by Swing Line Lender for

 

 

the correction of errors
among banks and thereafter at the Base Rate, as applicable.

 

(vi)                              Notwithstanding
anything contained herein to the contrary, (1) each Lender’s obligation to make
Revolving Loans for the purpose of repaying any Refunded Swing Line Loans
pursuant to the second preceding paragraph and each Lender’s obligation to
purchase a participation in any unpaid Swing Line Loans pursuant to the
immediately preceding paragraph shall be absolute and unconditional and shall
not be affected by any circumstance, including without limitation (A) any
set-off, counterclaim, recoupment, defense or other right which such Lender may
have against Swing Line Lender, any Credit Party or any other Person for any
reason whatsoever; (B) the occurrence or continuation of a Default or Event of
Default; (C) any adverse change in the business, operations, properties,
assets, financial condition of any Credit Party; (D) any breach of this
Agreement or any other Credit Document by any party thereto; or (E) any other
circumstance, happening or event whatsoever, whether or not similar to any of
the foregoing; provided that such obligations of each Lender are subject
to the condition that Swing Line Lender believed in good faith that all
conditions under Section 3.2 to the making of the applicable Refunded Swing
Line Loans or other unpaid Swing Line Loans, were satisfied at the time such
Refunded Swing Line Loans or unpaid Swing Line Loans were made, or the
satisfaction of any such condition not satisfied had been waived by Requisite
Lenders prior to or at the time such Refunded Swing Line Loans or other unpaid
Swing Line Loans were made; and (2) Swing Line Lender shall not be obligated to
make any Swing Line Loans (A) if it has elected not to do so after the
occurrence and during the continuation of an Event of Default or (B) at a time
when a Funding Default exists unless Swing Line Lender has entered into
arrangements satisfactory to it and Company to eliminate Swing Line Lender’s
risk with respect to the Defaulting Lender’s participation in such Swing Ling
Loan.

 

2.4. 
Issuance of Letters of Credit and Purchase of
Participations Therein.

 

(a)                                  Letters
of Credit.  During the Revolving
Commitment Period, subject to the terms and conditions hereof, Issuing Bank
agrees to issue Letters of Credit for the account of Company in the aggregate
amount up to but not exceeding the Letter of Credit Sublimit; provided,
(i) each Letter of Credit shall be denominated in Dollars; (ii) the stated
amount of each Letter of Credit shall not be less than $100,000 or such lesser
amount as is acceptable to Issuing Bank; (iii) after giving effect to such
issuance, in no event shall the Total Utilization of Revolving Commitments
exceed the Revolving Commitments then in effect; (iv) after giving effect to such
issuance, in no event shall the Letter of Credit Usage exceed the Letter of
Credit Sublimit then in effect; (v) in no event shall any standby Letter of
Credit have an expiration date later than the earlier of (1) the Revolving
Commitment Termination Date and (2) unless otherwise agreed to by Issuing Bank
the date which is one year from the date of issuance of such standby Letter of
Credit; and (vi) in no event shall any commercial Letter of Credit (x) have an
expiration date later than the earlier of (1) the Revolving Loan Commitment
Termination Date and (2) unless otherwise agreed to by Issuing Bank the date
which is 180 days from the date of issuance of such commercial Letter of Credit
or (b) be issued if such commercial Letter of Credit is otherwise unacceptable
to the Issuing Bank in its reasonable discretion.  Subject to the

 

 

foregoing, Issuing Bank
may agree that a standby Letter of Credit will automatically be extended for
one or more successive periods not to exceed one year each, unless Issuing Bank
elects not to extend for any such additional period; provided, Issuing
Bank shall not extend any such letter of credit if it has received written
notice that an Event of Default has occurred and is continuing at the time
Issuing Bank must elect to allow such extension; provided, further,
in the event a Funding Default exists, Issuing Bank shall not be required to
issue any Letter of Credit unless Issuing Bank has entered into arrangements
satisfactory to it and Company to eliminate Issuing Bank’s risk with respect to
the participation in Letters of Credit of the Defaulting Lender.

 

(b)                                 Notice
of Issuance.  Whenever Company
desires the issuance of a Letter of Credit, it shall deliver to Administrative
Agent and Issuing Bank an Issuance Notice no later than 12:00 p.m. (New York
City time) at least three Business Days, or such shorter period as may be
agreed to by Issuing Bank in any particular instance, in advance of the
proposed date of issuance.  Upon
satisfaction or waiver of the conditions set forth in Section 3.2, Issuing Bank
shall issue the requested Letter of Credit only in accordance with Issuing
Bank’s standard operating procedures. 
Upon the issuance of any Letter of Credit or amendment or modification to
a Letter of Credit, Issuing Bank shall promptly notify each Lender of such
issuance, which notice shall be accompanied by a copy of such Letter of Credit
or amendment or modification to a Letter of Credit and the amount of such
Lender’s respective participation in such Letter of Credit pursuant to Section
2.4(e).

 

(c)                                  Responsibility
of Issuing Bank With Respect to Requests for Drawings and Payments.  In determining whether to honor any drawing
under any Letter of Credit by the beneficiary thereof, Issuing Bank shall be
responsible only to examine the documents delivered under such Letter of Credit
with reasonable care so as to ascertain whether they appear on their face to be
in accordance with the terms and conditions of such Letter of Credit.  As between Company and Issuing Bank, Company
assumes all risks of the acts and omissions of, or misuse of the Letters of
Credit issued by Issuing Bank, by the respective beneficiaries of such Letters
of Credit.  In furtherance and not in
limitation of the foregoing, Issuing Bank shall not be responsible for: (i) the
form, validity, sufficiency, accuracy, genuineness or legal effect of any
document submitted by any party in connection with the application for and
issuance of any such Letter of Credit, even if it should in fact prove to be in
any or all respects invalid, insufficient, inaccurate, fraudulent or forged;
(ii) the validity or sufficiency of any instrument transferring or assigning or
purporting to transfer or assign any such Letter of Credit or the rights or
benefits thereunder or proceeds thereof, in whole or in part, which may prove
to be invalid or ineffective for any reason; (iii) failure of the beneficiary
of any such Letter of Credit to comply fully with any conditions required in
order to draw upon such Letter of Credit; (iv) errors, omissions, interruptions
or delays in transmission or delivery of any messages, by mail, cable,
telegraph, telex or otherwise, whether or not they be in cipher; (v) errors in
interpretation of technical terms; (vi) any loss or delay in the transmission
or otherwise of any document required in order to make a drawing under any such
Letter of Credit or of the proceeds thereof; (vii) the misapplication by the
beneficiary of any such Letter of Credit of the proceeds of any drawing under
such Letter of Credit; or (viii) any consequences arising from causes beyond
the control of Issuing Bank,

 

 

including any
Governmental Acts; none of the above shall affect or impair, or prevent the
vesting of, any of Issuing Bank’s rights or powers hereunder.  Without limiting the foregoing and in
furtherance thereof, any action taken or omitted by Issuing Bank under or in
connection with the Letters of Credit or any documents and certificates
delivered thereunder, if taken or omitted in good faith, shall not give rise to
any liability on the part of Issuing Bank to Company.  Notwithstanding anything to the contrary contained in this
Section 2.4(c), Company shall retain any and all rights it may have against
Issuing Bank for any liability arising solely out of the gross negligence or willful
misconduct of Issuing Bank or Issuing Bank’s employees, affiliates, agents,
officers or directors.

 

(d)                                 Reimbursement
by Company of Amounts Drawn or Paid Under Letters of Credit.  In the event Issuing Bank has determined to
honor a drawing under a Letter of Credit, it shall immediately notify Company
and Administrative Agent, and Company shall reimburse Issuing Bank on or before
the third Business Day immediately following the date on which such drawing is
honored (the “Reimbursement Date”) in an amount in Dollars and in same day
funds equal to the amount of such honored drawing; provided, anything
contained herein to the contrary notwithstanding, (i) unless Company shall have
notified Administrative Agent and Issuing Bank prior to noon (New York City
time) on the third Business Day immediately following the date on which such
drawing is honored that Company intends to reimburse Issuing Bank for the
amount of such honored drawing with funds other than the proceeds of Revolving
Loans, Company shall be deemed to have given a timely Funding Notice to
Administrative Agent requesting Lenders to make Revolving Loans that are Base
Rate Loans on the Reimbursement Date in an amount in Dollars equal to the
amount of such honored drawing, and (ii) irrespective of satisfaction or waiver
of the conditions specified in Section 3.2, which conditions, for the purposes
of repayment of amounts drawn on Letters of Credit to the Issuing Bank, Lenders
irrevocably waive and Lenders shall, on the Reimbursement Date, make Revolving
Loans that are Base Rate Loans in the amount of such honored drawing, the
proceeds of which shall be applied directly by Administrative Agent to
reimburse Issuing Bank for the amount of such honored drawing; and provided
further, if for any reason proceeds of Revolving Loans are not received
by Issuing Bank on the Reimbursement Date in an amount equal to the amount of
such honored drawing, Company shall reimburse Issuing Bank, within five
Business Days of demand in an amount in same day funds equal to the excess of
the amount of such honored drawing over the aggregate amount of such Revolving
Loans, if any, which are so received. 
Nothing in this Section 2.4(d) shall be deemed to relieve any Lender
from its obligation to make Revolving Loans on the terms and conditions set
forth herein, and Company shall retain any and all rights it may have against
any Lender resulting from the failure of such Lender to make such Revolving
Loans under this Section 2.4(d).

 

(e)                                  Lenders’
Purchase of Participations in Letters of Credit.  Immediately upon the issuance of each Letter of Credit, each
Lender having a Revolving Commitment shall be deemed to have purchased, and
hereby agrees to irrevocably purchase, from Issuing Bank a participation in
such Letter of Credit and any drawings honored thereunder in an amount equal to
such Lender’s Pro Rata Share (with respect to the Revolving Commitments) of the
maximum

 

 

amount which is or at any
time may become available to be drawn thereunder.  In the event that Company shall fail for any reason to reimburse
Issuing Bank as provided in Section 2.4(d), Issuing Bank shall promptly notify
each Lender of the unreimbursed amount of such honored drawing and of such
Lender’s respective participation therein based on such Lender’s Pro Rata Share
of the Revolving Commitments.  Each
Lender shall make available to Issuing Bank an amount equal to its respective
participation, in Dollars and in same day funds, at the office of Issuing Bank
specified in such notice, not later than 12:00 p.m. (New York City time) on the
first business day (under the laws of the jurisdiction in which such office of
Issuing Bank is located) after the date notified by Issuing Bank.  In the event that any Lender fails to make
available to Issuing Bank on such business day the amount of such Lender’s
participation in such Letter of Credit as provided in this Section 2.4(e),
Issuing Bank shall be entitled to recover such amount on demand from such
Lender together with interest thereon for three Business Days at the rate
customarily used by Issuing Bank for the correction of errors among banks and
thereafter at the Base Rate.  Nothing in
this Section 2.4(e) shall be deemed to prejudice the right of any Lender to
recover from Issuing Bank any amounts made available by such Lender to Issuing
Bank pursuant to this Section in the event that it is determined that the
payment with respect to a Letter of Credit in respect of which payment was made
by such Lender constituted gross negligence or willful misconduct on the part of
Issuing Bank.  In the event Issuing Bank
shall have been reimbursed by other Lenders pursuant to this Section 2.4(e) for
all or any portion of any drawing honored by Issuing Bank under a Letter of
Credit, such Issuing Bank shall distribute to each Lender which has paid all
amounts payable by it under this Section 2.4(e) with respect to such honored
drawing such Lender’s Pro Rata Share of all payments subsequently received by
Issuing Bank from Company in reimbursement of such honored drawing when such
payments are received.  Any such
distribution shall be made to a Lender at its primary address set forth below
its name on Appendix B or at such other address as such Lender may request.

 

(f)                                    Obligations
Absolute.  The obligation of Company
to reimburse Issuing Bank for drawings honored under the Letters of Credit
issued by it and to repay any Revolving Loans made by Lenders pursuant to
Section 2.4(d) and the obligations of Lenders under Section 2.4(e) shall be
unconditional and irrevocable and shall be paid strictly in accordance with the
terms hereof under all circumstances including any of the following
circumstances: (i) any lack of validity or enforceability of any Letter of
Credit; (ii) the existence of any claim, set-off, defense or other right which
Company or any Lender may have at any time against a beneficiary or any
transferee of any Letter of Credit (or any Persons for whom any such transferee
may be acting), Issuing Bank, Lender or any other Person or, in the case of a
Lender, against Company, whether in connection herewith, the transactions
contemplated herein or any unrelated transaction (including any underlying
transaction between Company or one of its Subsidiaries and the beneficiary for
which any Letter of Credit was procured); (iii) any draft or other document
presented under any Letter of Credit proving to be forged, fraudulent, invalid
or insufficient in any respect or any statement therein being untrue or
inaccurate in any respect; (iv) payment by Issuing Bank under any Letter of
Credit against presentation of a draft or other document which does not
substantially comply with the terms of such Letter of Credit; (v) any adverse
change in the business, operations, properties, assets, or financial condition
of Holdings

 

 

or any of its Subsidiaries;
(vi) any breach hereof or any other Credit Document by any party thereto; (vii)
any other circumstance or happening whatsoever, whether or not similar to any
of the foregoing; or (viii) the fact that an Event of Default or a Default
shall have occurred and be continuing; provided, in each case, that
payment by Issuing Bank under the applicable Letter of Credit shall not have
constituted gross negligence or willful misconduct of Issuing Bank under the
circumstances in question.

 

(g)                                 Indemnification.  Without duplication of any obligation of
Company under Section 10.2 or 10.3, in addition to amounts payable as provided
herein, Company hereby agrees to protect, indemnify, pay and save harmless
Issuing Bank from and against any and all claims, demands, liabilities,
damages, losses (other than lost profits) and out-of-pocket costs and expenses
(including reasonable fees, expenses and disbursements of counsel which Issuing
Bank actually incurs as a consequence, direct or indirect, of (i) the issuance
of any Letter of Credit by Issuing Bank, other than as a result of (1) the
gross negligence or willful misconduct of Issuing Bank or (2) the wrongful
dishonor by Issuing Bank of a proper demand for payment made under any Letter
of Credit issued by it, or (ii) the failure of Issuing Bank to honor a drawing
under any such Letter of Credit as a result of any Governmental Act.

 

2.5.  Pro Rata Shares; Availability of Funds.

 

(a)                                  Pro
Rata Shares.  All Loans shall be
made, and all participations purchased, by Lenders simultaneously and
proportionately to their respective Pro Rata Shares, it being understood that
no Lender shall be responsible for any default by any other Lender in such
other Lender’s obligation to make a Loan requested hereunder or purchase a
participation required hereby nor shall any Term Loan Commitment or any
Revolving Commitment of any Lender be increased or decreased as a result of a
default by any other Lender in such other Lender’s obligation to make a Loan
requested hereunder or purchase a participation required hereby.

 

(b)                                 Availability
of Funds.  Unless Administrative
Agent shall have been notified by any Lender prior to the applicable Credit
Date that such Lender does not intend to make available to Administrative Agent
the amount of such Lender’s Loan requested on such Credit Date, Administrative
Agent may assume that such Lender has made such amount available to
Administrative Agent on such Credit Date and Administrative Agent may, in its
sole discretion, but shall not be obligated to, make available to Company a
corresponding amount on such Credit Date. 
If such corresponding amount is not in fact made available to
Administrative Agent by such Lender, Administrative Agent shall be entitled to
recover such corresponding amount on demand from such Lender together with
interest thereon, for each day from such Credit Date until the date such amount
is paid to Administrative Agent, at the customary rate set by Administrative
Agent for the correction of errors among banks for three Business Days and thereafter
at the Base Rate.  If such Lender does
not pay such corresponding amount forthwith upon Administrative Agent’s demand
therefor, Administrative Agent shall promptly notify Company and Company shall
immediately pay such corresponding amount to Administrative

 

 

Agent together with
interest thereon, for each day from such Credit Date until the date such amount
is paid to Administrative Agent, at the rate payable hereunder for Base Rate
Loans for such Class of Loans.  Nothing
in this Section 2.5(b) shall be deemed to relieve any Lender from its
obligation to fulfill its Term Loan Commitments and Revolving Commitments
hereunder or to prejudice any rights that Company may have against any Lender
as a result of any default by such Lender hereunder.

 

2.6.  Use of Proceeds.  The proceeds of the Term Loans and the
Revolving Loans, if any, made on the Closing Date shall be applied by Company
to finance the Acquisition and to pay related fees and expenses; provided,
no more than $5,000,000 of Revolving Loans may be used for such purposes. The
proceeds of the Revolving Loans, Swing Line Loans and Letters of Credit made
after the Closing Date shall be applied by Company for working capital and
general corporate purposes of Company and its Subsidiaries, including Permitted
Acquisitions.  No portion of the
proceeds of any Credit Extension shall be used in any manner that causes such
Credit Extension or the application of such proceeds to violate any regulation
of the Board of Governors of the Federal Reserve System including Regulation T,
Regulation U or Regulation X, or to violate the Exchange Act.

 

2.7.  Evidence of Debt; Register; Lenders’ Books and
Records; Notes.

 

(a)                                  Lenders’
Evidence of Debt.  Each Lender shall
maintain on its internal records an account or accounts evidencing the
Indebtedness of Company to such Lender, including the amounts of the Loans made
by it and each repayment and prepayment in respect thereof.  Any such recordation shall be presumptively
correct, absent manifest error; provided, failure to make any such
recordation, or any error in such recordation, shall not affect any Lender’s
Revolving Commitments or Company’s Obligations in respect of any applicable
Loans; and provided  further, in the event of any inconsistency
between the Register and any Lender’s records, the recordations in the Register
shall govern.

 

(b)                                 Register.  Administrative Agent shall maintain at its
Principal Office a register for the recordation of the names and addresses of
Lenders and the Revolving Commitments and Loans of each Lender from time to
time (the “Register”).  The Register shall be available for
inspection by Company or any Lender at any reasonable time and from time to
time upon reasonable prior notice. 
Administrative Agent shall record in the Register the Revolving
Commitments and the Loans, and each repayment or prepayment in respect of the
principal amount of the Loans, and any such recordation shall be presumptively
correct, absent manifest error; provided, failure to make any such
recordation, or any error in such recordation, shall not affect any Lender’s
Revolving Commitments or Company’s Obligations in respect of any Loan.  Company hereby designates LCP to serve as
Company’s agent solely for purposes of maintaining the Register as provided in
this Section 2.7, and Company hereby agrees that, to the extent LCP serves in
such capacity, LCP and its officers, directors, employees, agents and
affiliates shall constitute “Indemnitees.”

 

 

(c)                                  Notes.  If so requested by any Lender by written
notice to Company (with a copy to Administrative Agent) at least two Business
Days prior to the Closing Date, or at any time thereafter, Company shall
execute and deliver to such Lender (and/or, if applicable and if so specified
in such notice, to any Person who is an assignee of such Lender pursuant to
Section 10.6) on the Closing Date (or, if such notice is delivered after the
Closing Date, promptly after Company’s receipt of such notice) a Note or Notes
to evidence such Lender’s Tranche A Term Loan, Tranche B Term Loan, Tranche C
Term Loan, Revolving Loans or Swing Line Loans, as the case may be.

 

2.8.  Interest on Loans.

 

(a)                                  Except
as otherwise set forth herein, each Class of Loan shall bear interest on the
unpaid principal amount thereof from the date made through repayment (whether
by acceleration or otherwise) thereof as follows:

 

(i)                                     In
the case of Loans, other than Swing Line Loans;

 

(1)                                  if
a Base Rate Loan, at the Base Rate plus the Applicable Margin; or

 

(2)                                  if
a Eurodollar Rate Loan, at the Adjusted Eurodollar Rate plus the Applicable
Margin; and

 

(ii)                                  In
the case of Swing Line Loans at the Base Rate plus the Applicable Margin less
the Applicable Revolving Commitment Fee Percentage.

 

(b)                                 The
basis for determining the rate of interest with respect to any Loan (except a
Swing Line Loan which can be made and maintained as Base Rate Loans only), and
the Interest Period with respect to any Eurodollar Rate Loan, shall be selected
by Company and notified to Administrative Agent and Lenders pursuant to the
applicable Funding Notice or Conversion/Continuation Notice, as the case may
be; provided, the Loans initially shall be made as Base Rate Loans or
Eurodollar Rate Loans with an Interest Period of thirty days until the date
which is the earlier of the date the primary syndication is completed and
ninety days following the Closing Date ; provided further in the event
that Company does not elect Base Rate during such period Company will pay all
reasonable breakage costs actually incurred in connection with the
syndication.  If on any day a Loan is
outstanding with respect to which a Funding Notice or Conversion/Continuation
Notice has not been delivered to Administrative Agent in accordance with the
terms hereof specifying the applicable basis for determining the rate of interest,
then for that day such Loan shall be a Base Rate Loan.

 

(c)                                  In
connection with Eurodollar Rate Loans there shall be no more than fifteen
Interest Periods outstanding at any time. 
In the event Company fails to specify between a Base Rate Loan or a Eurodollar
Rate Loan in the applicable Funding Notice or

 

 

Conversion/Continuation
Notice, such Loan (if outstanding as a Eurodollar Rate Loan) will be
automatically converted into a Base Rate Loan on the last day of the
then-current Interest Period for such Loan (or if outstanding as a Base Rate
Loan will remain as, or (if not then outstanding) will be made as, a Base Rate
Loan).  In the event Company fails to
specify an Interest Period for any Eurodollar Rate Loan in the applicable
Funding Notice or Conversion/Continuation Notice, Company shall be deemed to
have selected an Interest Period of one month. 
As soon as practicable after noon (New York City time) on each Interest
Rate Determination Date, Administrative Agent shall determine (which
determination shall be presumptively correct, absent manifest error) the
interest rate that shall apply to the Eurodollar Rate Loans for which an
interest rate is then being determined for the applicable Interest Period and
shall promptly give notice thereof (in writing or by telephone confirmed in
writing) to Company and each Lender.

 

(d)                                 Interest
payable pursuant to Section 2.8(a) shall be computed (i) in the case of Base
Rate Loans on the basis of a 365-day or 366-day year, as the case may be, and
(ii) in the case of Eurodollar Rate Loans, on the basis of a 360-day year, in
each case for the actual number of days elapsed in the period during which it
accrues.  In computing interest on any
Loan, the date of the making of such Loan or the first day of an Interest
Period applicable to such Loan or, with respect to a Base Rate Loan being
converted from a Eurodollar Rate Loan, the date of conversion of such
Eurodollar Rate Loan to such Base Rate Loan, as the case may be, shall be
included, and the date of payment of such Loan or the expiration date of an
Interest Period applicable to such Loan or, with respect to a Base Rate Loan
being converted to a Eurodollar Rate Loan, the date of conversion of such Base
Rate Loan to such Eurodollar Rate Loan, as the case may be, shall be excluded; provided,
if a Loan is repaid on the same day on which it is made, one day’s interest
shall be paid on that Loan.

 

(e)                                  Except
as otherwise set forth herein, interest on each Loan shall be payable in
arrears on and to (i) each Interest Payment Date applicable to that Loan; (ii)
any prepayment of that Loan, whether voluntary or mandatory, to the extent
accrued on the amount being prepaid; and (iii) at maturity, including final
maturity; provided, however, with respect to any voluntary
prepayment of a Base Rate Loan, accrued interest shall instead be payable on
the applicable Interest Payment Date.

 

(f)                                    Company
agrees to pay to Issuing Bank, with respect to drawings honored under any
Letter of Credit, interest on the amount paid by Issuing Bank in respect of
each such honored drawing from the date such drawing is honored to but
excluding the date such amount is reimbursed by or on behalf of Company at a
rate equal to (i) for the period from the date such drawing is honored to but
excluding the applicable Reimbursement Date, the rate of interest otherwise
payable hereunder with respect to Revolving Loans that are Base Rate Loans, and
(ii) thereafter, a rate which is 2% per annum in excess of the rate of interest
otherwise payable hereunder with respect to Revolving Loans that are Base Rate
Loans.

 

(g)                                 Interest
payable pursuant to Section 2.8(f) shall be computed on the basis of a 365 or
366-day year for the actual number of days elapsed in the period during which
it

 

 

accrues, and shall be
payable on demand or, if no demand is made, on the date on which the related
drawing under a Letter of Credit is reimbursed in full.  Promptly upon receipt by Issuing Bank of any
payment of interest pursuant to Section 2.8(f), Issuing Bank shall distribute
to each Lender, out of the interest received by Issuing Bank in respect of the
period from the date such drawing is honored to but excluding the date on which
Issuing Bank is reimbursed for the amount of such drawing (including any such
reimbursement out of the proceeds of any Revolving Loans), the amount that such
Lender would have been entitled to receive in respect of the letter of credit
fee that would have been payable in respect of such Letter of Credit for such
period if no drawing had been honored under such Letter of Credit.  In the event Issuing Bank shall have been
reimbursed by Lenders for all or any portion of such honored drawing, Issuing
Bank shall distribute to each Lender which has paid all amounts payable by it
under Section 2.4(e) with respect to such honored drawing such Lender’s Pro
Rata Share of any interest received by Issuing Bank in respect of that portion
of such honored drawing so reimbursed by Lenders for the period from the date
on which Issuing Bank was so reimbursed by Lenders to but excluding the date on
which such portion of such honored drawing is reimbursed by Company.

 

2.9.  Conversion/Continuation.

 

(a)                                  Subject
to Section 2.18 and so long as no Event of Default shall have occurred and then
be continuing, Company shall have the option:

 

(i)                                     to
convert at any time all or any part of any Term Loan or Revolving Loan equal to
$1,000,000 from one Type of Loan to another Type of Loan; provided, a
Eurodollar Rate Loan may only be converted on the expiration of the Interest
Period applicable to such Eurodollar Rate Loan unless Company shall pay all
amounts due under Section 2.18 in connection with any such conversion; or

 

(ii)                                  upon
the expiration of any Interest Period applicable to any Eurodollar Rate Loan,
to continue all or any portion of such Loan equal to $1,000,000 as a Eurodollar
Rate Loan.

 

(b)                                 The
Company shall deliver a Conversion/Continuation Notice to Administrative Agent
no later than noon (New York City time) at least one Business Day in advance of
the proposed conversion date (in the case of a conversion to a Base Rate Loan)
and at least three Business Days in advance of the proposed
conversion/continuation date (in the case of a conversion to, or a continuation
of, a Eurodollar Rate Loan).  Except as
otherwise provided herein, a Conversion/Continuation Notice for conversion to,
or continuation of, any Eurodollar Rate Loans (or telephonic notice in lieu
thereof) shall be irrevocable on and after the related Interest Rate
Determination Date, and Company shall be bound to effect a conversion or
continuation in accordance therewith.

 

2.10.  Default Interest.  Upon the occurrence and during the
continuance of an Event of Default described in Section 8.1(a), to the extent
permitted by applicable law, any interest or

 

 

principal payments on the
Loans or any fees or other amounts owed hereunder, in each case not paid when
due whether at stated maturity, by notice of prepayment, by acceleration or
otherwise, shall thereafter bear interest (including post-petition interest in
any proceeding under the Bankruptcy Code or other applicable bankruptcy laws)
payable on demand at a rate that is 2% per annum in excess of the interest rate
otherwise payable hereunder with respect to the applicable Loans (or, in the
case of any such fees and other amounts, at a rate which is 2% per annum in
excess of the interest rate otherwise payable hereunder for Base Rate Loans); provided,
in the case of Eurodollar Rate Loans, upon the expiration of the Interest
Period in effect at the time any such increase in interest rate is effective,
if such Event of Default is continuing, such Eurodollar Rate Loans shall
thereupon become Base Rate Loans and shall thereafter bear interest payable
upon demand at a rate which is 2% per annum in excess of the interest rate
otherwise payable hereunder for Base Rate Loans.  Payment or acceptance of the increased rates of interest provided
for in this Section 2.10 is not a permitted alternative to timely payment and
shall not constitute a waiver of any Event of Default or otherwise prejudice or
limit any rights or remedies of Administrative Agent or any Lender.

 

2.11.  Fees.

 

(a)                                  Company
agrees to pay to Lenders having Revolving Exposure

 

(i)                                     commitment
fees equal to (1) the average of the daily difference between (a) the Revolving
Commitments, and (b) the sum of (x) the aggregate principal amount of
outstanding Revolving Loans (but not any outstanding Swing Line Loans) plus (y)
the Letter of Credit Usage, times (2) the Applicable Revolving Commitment Fee
Percentage; and

 

(ii)                                  letter
of credit fees equal to (1) the Applicable Margin for Revolving Loans that are
Eurodollar Rate Loans, times (2) the average aggregate daily maximum amount
available to be drawn under all such Letters of Credit (regardless of whether
any conditions for drawing could then be met and determined as of the close of
business on any date of determination) less the amount of fees paid to
Issuing Bank for the applicable period pursuant to Section 2.11(b)(i).

 

All fees referred to in this Section 2.11(a) shall be paid to
Administrative Agent at its Principal Office and upon receipt, Administrative
Agent shall promptly distribute to each Lender its Pro Rata Share thereof.

 

(b)                                 Company
agrees to pay directly to each Issuing Bank, for its own account, the following
fees:

 

(i)                                     a
fronting fee equal to 0.250%, per annum, times the average aggregate daily
maximum amount available to be drawn under all Letters of Credit issued by such
Issuing Bank(determined as of the close of business on any date of
determination); and

 

 

(ii)                                  such
documentary and processing charges for any issuance, amendment, transfer or
payment of a Letter of Credit as are in accordance with Issuing Bank’s standard
schedule for such charges and as in effect at the time of such issuance,
amendment, transfer or payment, as the case may be.

 

(c)                                  All
fees referred to in Section 2.11(a) and 2.11(b)(i) shall be calculated on the
basis of a 365/366 year and the actual number of days elapsed and shall be
payable quarterly in arrears on March 31, June 30, September 30 and December 31
of each year during the Revolving Commitment Period, commencing on the first
such date to occur after the Closing Date, and on the Revolving Commitment
Termination Date.

 

(d)                                 In
addition to any of the foregoing fees, Company agrees to pay to Agents such
other fees in the amounts and at the times separately agreed upon.

 

2.12.  Scheduled Payments/Commitment Reductions.

 

(a)                                  Scheduled
Installments.  The principal amounts
of the Term Loans shall be repaid in consecutive quarterly installments (each,
an “Installment”)
in the aggregate amounts set forth below on the last day of each Fiscal Quarter
(each, an “Installment
Date”), commencing September 30, 2000:

 

	
  Fiscal Quarter

  	
   

  	
  Tranche A
  Term

  Loan Installments

  	
   

  	
  Tranche B
  Term

  Loan Installments

  	
   

  	
  Tranche C
  Term

  Loan Installments

  	
   

  
	
  September 30, 2000

  	
   

  	
  $

  	
  3,750,000

  	
   

  	
  $

  	
  500,000

  	
   

  	
  $

  	
  375,000

  	
   

  
	
  December 31, 2000

  	
   

  	
  $

  	
  3,750,000

  	
   

  	
  $

  	
  500,000

  	
   

  	
  $

  	
  375,000

  	
   

  
	
  March 31, 2001

  	
   

  	
  $

  	
  6,250,000

  	
   

  	
  $

  	
  500,000

  	
   

  	
  $

  	
  375,000

  	
   

  
	
  June 30, 2001

  	
   

  	
  $

  	
  6,250,000

  	
   

  	
  $

  	
  500,000

  	
   

  	
  $

  	
  375,000

  	
   

  
	
  September 30, 2001

  	
   

  	
  $

  	
  6,250,000

  	
   

  	
  $

  	
  500,000

  	
   

  	
  $

  	
  375,000

  	
   

  
	
  December 31, 2001

  	
   

  	
  $

  	
  6,250,000

  	
   

  	
  $

  	
  500,000

  	
   

  	
  $

  	
  375,000

  	
   

  
	
  March 31, 2002

  	
   

  	
  $

  	
  10,000,000

  	
   

  	
  $

  	
  500,000

  	
   

  	
  $

  	
  375,000

  	
   

  
	
  June 30, 2002

  	
   

  	
  $

  	
  10,000,000

  	
   

  	
  $

  	
  500,000

  	
   

  	
  $

  	
  375,000

  	
   

  
	
  September 30, 2002

  	
   

  	
  $

  	
  10,000,000

  	
   

  	
  $

  	
  500,000

  	
   

  	
  $

  	
  375,000

  	
   

  
	
  December 31, 2002

  	
   

  	
  $

  	
  10,000,000

  	
   

  	
  $

  	
  500,000

  	
   

  	
  $

  	
  375,000

  	
   

  
	
  March 31, 2003

  	
   

  	
  $

  	
  10,000,000

  	
   

  	
  $

  	
  500,000

  	
   

  	
  $

  	
  375,000

  	
   

  
	
  June 30, 2003

  	
   

  	
  $

  	
  10,000,000

  	
   

  	
  $

  	
  500,000

  	
   

  	
  $

  	
  375,000

  	
   

  
	
  September 30, 2003

  	
   

  	
  $

  	
  10,000,000

  	
   

  	
  $

  	
  500,000

  	
   

  	
  $

  	
  375,000

  	
   

  
	
  December 31, 2003

  	
   

  	
  $

  	
  10,000,000

  	
   

  	
  $

  	
  500,000

  	
   

  	
  $

  	
  375,000

  	
   

  
	
  March 31, 2004

  	
   

  	
  $

  	
  10,000,000

  	
   

  	
  $

  	
  500,000

  	
   

  	
  $

  	
  375,000

  	
   

  
	
  June 30, 2004

  	
   

  	
  $

  	
  10,000,000

  	
   

  	
  $

  	
  500,000

  	
   

  	
  $

  	
  375,000

  	
   

  
	
  September 30, 2004

  	
   

  	
  $

  	
  10,000,000

  	
   

  	
  $

  	
  500,000

  	
   

  	
  $

  	
  375,000

  	
   

  
	
  December 31, 2004

  	
   

  	
  $

  	
  10,000,000

  	
   

  	
  $

  	
  500,000

  	
   

  	
  $

  	
  375,000

  	
   

  
	
  March 31, 2005

  	
   

  	
  $

  	
  3,750,000

  	
   

  	
  $

  	
  500,000

  	
   

  	
  $

  	
  375,000

  	
   

  
	
  June 30, 2005

  	
   

  	
  $

  	
  3,750,000

  	
   

  	
  $

  	
  500,000

  	
   

  	
  $

  	
  375,000

  	
   

  
	
  September 30, 2005

  	
   

  	
  $

  	
  3,750,000

  	
   

  	
  $

  	
  22,500,000

  	
   

  	
  $

  	
  375,000

  	
   

  
	
  December 31, 2005

  	
   

  	
  $

  	
  3,750,000

  	
   

  	
  $

  	
  22,500,000

  	
   

  	
  $

  	
  375,000

  	
   

  
	
  March 31, 2006

  	
   

  	
  $

  	
  3,750,000

  	
   

  	
  $

  	
  22,500,000

  	
   

  	
  $

  	
  375,000

  	
   

  
	
  June 30, 2006

  	
   

  	
  $

  	
  3,750,000

  	
   

  	
  $

  	
  22,500,000

  	
   

  	
  $

  	
  375,000

  	
   

  
	
  September 30, 2006

  	
   

  	
  —

  	
   

  	
  $

  	
  25,000,000

  	
   

  	
  $

  	
  375,000

  	
   

  
	
  December 31, 2006

  	
   

  	
  —

  	
   

  	
  $

  	
  25,000,000

  	
   

  	
  $

  	
  375,000

  	
   

  
	
  March 31, 2007

  	
   

  	
  —

  	
   

  	
  $

  	
  25,000,000

  	
   

  	
  $

  	
  375,000

  	
   

  
	
  June 30, 2007

  	
   

  	
  —

  	
   

  	
  $

  	
  25,000,000

  	
   

  	
  $

  	
  375,000

  	
   

  
	
  September 30, 2007

  	
   

  	
  —

  	
   

  	
  —

  	
   

  	
  $

  	
  34,875,000

  	
   

  
	
  December 31, 2007

  	
   

  	
  —

  	
   

  	
  —

  	
   

  	
  $

  	
  34,875,000

  	
   

  
	
  March 31, 2008

  	
   

  	
  —

  	
   

  	
  —

  	
   

  	
  $

  	
  34,875,000

  	
   

  
	
  June 30, 2008

  	
   

  	
  —

  	
   

  	
  —

  	
   

  	
  $

  	
  34,875,000

  	
   

  

 

 

Notwithstanding the foregoing, (x) such Installments shall be reduced
in connection with any voluntary or mandatory prepayments of the Tranche A Term
Loans, the Tranche B Term Loans or Tranche C Term Loans, as the case may be, in
accordance with Sections 2.13, 2.14 and 2.15, as applicable; and (y) the
Tranche A Term Loans, the Tranche B Term Loans and Tranche C Term Loans,
together with all other amounts owed hereunder with respect thereto, shall, in
any event, be paid in full no later than the Tranche A Term Loan Maturity Date,
the Tranche B Term Loan Maturity Date and the Tranche C Term Loan Maturity
Date, respectively.

 

2.13.                     Voluntary Prepayments/Commitment
Reductions.

 

(a)                                  Voluntary
Prepayments.

 

(i)                                     Any
time and from time to time:

 

(1)                                  with
respect to Base Rate Loans, Company may prepay any such Loans on any Business
Day in whole or in part, in an aggregate minimum amount of $250,000;

 

(2)                                  with
respect to Eurodollar Rate Loans, Company may prepay any such Loans on any
Business Day in whole or in part in an aggregate minimum amount of $1,000,000;
and

 

(3)                                  with
respect to Swing Line Loans, Company may prepay any such Loans on any Business
Day in whole or in part in an aggregate minimum amount of $250,000.

 

(ii)                                  All
such prepayments shall be made:

 

(1)                                  upon
not less than one Business Day’s prior written or telephonic notice in the case
of Base Rate Loans and Eurodollar;

 

 

(2)                                  upon
written or telephonic notice on or before the date of prepayment, in the case
of Swing Line Loans;

 

in each case given to Administrative Agent or Swing Line Lender, as
applicable, by 1:00 p.m. (New York City time) on the date required and, if
given by telephone, promptly confirmed in writing to Administrative Agent (and
Administrative Agent will promptly transmit such telephonic or original notice
for Term Loans or Revolving Loans, as the case may be, by telefacsimile or
telephone to each Lender) or Swing Line Lender, as the case may be.  Upon the giving of any such notice, the
principal amount of the Loans specified in such notice shall become due and
payable on the prepayment date specified therein.

 

(b)                                 Voluntary
Commitment Reductions.

 

(i)                                     Company
may, upon not less than one Business Days’ prior written or telephonic notice
confirmed in writing to Administrative Agent (which original written or
telephonic notice Administrative Agent will promptly transmit by telefacsimile
or telephone to each applicable Lender), at any time and from time to time
terminate in whole or permanently reduce in part, without premium or penalty,
the Revolving Commitments in an amount up to the amount by which the Revolving
Commitments exceed the Total Utilization of Revolving Commitments at the time
of such proposed termination or reduction; provided, any such partial
reduction of the Revolving Commitments shall be in an aggregate minimum amount
of $1,000,000.

 

(ii)                                  Company’s
notice to Administrative Agent shall designate the date (which shall be a
Business Day) of such termination or reduction and the amount of any partial
reduction, and such termination or reduction of the Revolving Commitments shall
be effective on the date specified in Company’s notice and shall reduce the
Revolving Commitment of each Lender proportionately to its Pro Rata Share
thereof.

 

2.14.                     Mandatory Prepayments/Commitment
Reductions.

 

(a)                                  Asset
Sales.  No later than the fifth
Business Day following the date of receipt by Holdings or any of its Domestic
Subsidiaries of any Net Asset Sale Proceeds, Company shall prepay the Loans
and/or the Revolving Commitments shall be permanently reduced as set forth in
Section 2.15(b) in an aggregate amount equal to such Net Asset Sale Proceeds; provided,
notwithstanding the foregoing, so long as no  Event of Default shall have
occurred and be continuing, Company shall have the option, directly or through
one or more of its Subsidiaries, to invest Net Asset Sale Proceeds within three
hundred sixty five days of receipt thereof in the business of Company and its
Subsidiaries;

 

(b)                                 Insurance/Condemnation
Proceeds.  No later than the fifth
Business Day following the date of receipt by Holdings or any of its
Subsidiaries, or Administrative Agent as loss payee, of any Net
Insurance/Condemnation Proceeds, Company shall prepay the Loans

 

 

and/or the Revolving
Commitments shall be permanently reduced as set forth in Section 2.15(b) in an
aggregate amount equal to such Net Insurance/Condemnation Proceeds; provided,
notwithstanding the foregoing, so long as no Event of Default shall have
occurred and be continuing, Company shall have the option, directly or through
one or more of its Subsidiaries to invest such Net Insurance/Condemnation
Proceeds within three hundred sixty five days of receipt thereof in replacement
assets;

 

(c)                                  Issuance
of Equity Securities.  On the date
of receipt by Holdings of any Cash proceeds from a capital contribution to, or
the issuance of any Capital Stock of, Holdings (other than any such capital
contribution by or issuance made to Sponsor or any of its Affiliates or a
Permitted Investor or the proceeds of which are used to finance Permitted Acquisitions
or Capital Expenditures of Company and/or its Subsidiaries) Company shall
prepay the Loans as set forth in Section 2.15(b) in an aggregate amount equal
to 50% of such proceeds, net of underwriting discounts and commissions and
other reasonable costs and expenses associated therewith, including reasonable
legal fees and expenses; provided, during any period in which (x) the
Leverage Ratio (determined for any such period by reference to the most recent
Compliance Certificate delivered pursuant to Section 5.1(d) calculating the
Leverage Ratio) shall be 2.00:1.00 or less and (y) the ratio of (i)
Consolidated Total Debt plus the aggregate principal amount of
outstanding Holding Notes to (ii) Consolidated Adjusted EBITDA for the four
Fiscal Quarter period most recently ended is 3.0:1.0 or less, Company shall
only be required to make the prepayments and/or reductions otherwise required
hereby in an amount equal to 25% of such net proceeds.

 

(d)                                 Consolidated
Excess Cash Flow.  In the event that
there shall be Consolidated Excess Cash Flow for any Fiscal Year (commencing
with Fiscal Year ending December 31, 2001), Company shall, no later than one
hundred twenty days after the end of such Fiscal Year, prepay the Loans as set
forth in Section 2.15(b) in an aggregate amount equal to 50% of such
Consolidated Excess Cash Flow; provided, during any period in which (x)
the Leverage Ratio (determined for any such period by reference to the most
recent Compliance Certificate delivered pursuant to Section 5.1(d) calculating
the Leverage Ratio) shall be 2.00:1.00 or less and (y) the ratio of (i)
Consolidated Total Debt plus the aggregate principal amount of
outstanding Holding Notes to (ii) Consolidated Adjusted EBITDA for the four
Fiscal Quarter period most recently ended is 3.0:1.0 or less, Company shall
only be required to make the prepayments and/or reductions otherwise required
hereby in an amount equal to 25% of such Consolidated Excess Cash Flow.

 

(e)                                  Revolving
Loans and Swing Loans.  Company
shall from time to time prepay first, the Swing Line Loans, and second,
the Revolving Loans to the extent necessary so that the Total Utilization of
Revolving Commitments shall not at any time exceed the Revolving Commitments
then in effect.

 

(f)                                    Prepayment
Certificate.  Concurrently with any
prepayment of the Loans and/or reduction of the Revolving Commitments pursuant
to Sections 2.14(a) through 2.14(d), Company

 

 

shall deliver to
Administrative Agent a certificate of an Authorized Officer demonstrating the
calculation of the amount of the applicable net proceeds or Consolidated Excess
Cash Flow, as the case may be.  In the
event that Company shall subsequently determine that the actual amount received
exceeded the amount set forth in such certificate, Company shall promptly make
an additional prepayment of the Loans and/or the Revolving Commitments shall be
permanently reduced, as applicable, in an amount equal to such excess, and
Company shall concurrently therewith deliver to Administrative Agent a
certificate of an Authorized Officer demonstrating the derivation of such
excess.

 

2.15.                     Application of
Prepayments/Reductions.

 

(a)                                  Application
of Voluntary Prepayments by Type of Loans. 
Any prepayment of any Loan pursuant to Section 2.13(a) shall be applied
as specified by Company in the applicable notice of prepayment; provided,
in the event Company fails to specify the Loans to which any such prepayment
shall be applied, such prepayment shall be applied as follows:

 

first, to repay
outstanding Swing Line Loans to the full extent thereof;

 

second, to repay
outstanding Revolving Loans to the full extent thereof; and

 

third, to prepay
the Term Loans on a pro rata basis (in accordance with the respective
outstanding principal amounts thereof).

 

Any prepayment of
any Term Loan pursuant to Section 2.13(a) shall be further applied first,
to remaining scheduled Installments with respect to such Term Loan for the
immediately succeeding twelve-month period in the order of maturity thereof and
second, to the extent of any portion of such prepayment amount remaining
after such application, pro rata among remaining scheduled Installments on such
Term Loan.

 

(b)                                 Application
of Mandatory Prepayments by Type of Loans. 
Any amount required to be paid pursuant to Sections 2.14(a) through
2.14(d) shall be applied

 

first, to prepay
the Term Loans on a pro rata basis (in accordance with the respective
outstanding principal amounts thereof) and shall be further applied on a pro
rata basis first, to remaining scheduled Installments on the Term Loans
for the immediately succeeding twelve-month period in the order of maturity
thereof and second, to the extent of any portion of such prepayment
amount remaining after such application, pro rata among remaining scheduled
Installments of principal on the Term Loans;

 

second, to prepay
the Swing Line Loans to the full extent thereof and, in the case of prepayments
made pursuant to Sections 2.14(a) and (b), to permanently reduce the Revolving
Commitments by the amount of such prepayment;

 

 

third, to prepay
the Revolving Loans to the full extent thereof and, in the case of prepayments
made pursuant to Sections 2.14(a) and (b), to further permanently reduce the
Revolving Commitments by the amount of such prepayment;

 

fourth, to prepay
outstanding reimbursement obligations with respect to Letters of Credit and, in
the case of prepayments made pursuant to Sections 2.14(a) and (b), to further
permanently reduce the Revolving Loan Commitments by the amount of such
prepayment;

 

fifth, to cash
collateralize Letters of Credit and, in the case of prepayments made pursuant
to Sections 2.14(a) and (b), to further permanently reduce the Revolving Loan
Commitments by the amount of such cash collateralization; and

 

sixth, in the case
of prepayments made pursuant to Sections 2.14(a) and (b) to further permanently
reduce the Revolving Commitments to the full extent thereof.

 

(c)                                  Waivable
Mandatory Prepayment.  Anything
contained herein to the contrary notwithstanding, so long as any Tranche A Term
Loans are outstanding, in the event Company is required to make any mandatory
prepayment (a “Waivable Mandatory Prepayment”) of the Tranche B Term Loans,
or Tranche C Term Loans not less than three Business Days prior to the date
(the “Required
Prepayment Date”) on which Company is required to make such Waivable
Mandatory Prepayment, Company shall notify Administrative Agent of the amount
of such prepayment, and Administrative Agent will promptly thereafter notify
each Lender holding an outstanding Tranche B Term Loan, or Tranche C Term Loan
of the amount of such Lender’s Pro Rata Share of such Waivable Mandatory
Prepayment and such Lender’s option to refuse such amount.  Each such Lender may exercise such option by
giving written notice to Company and Administrative Agent of its election to do
so on or before the first Business Day prior to the Required Prepayment Date
(it being understood that any Lender which does not notify Company and
Administrative Agent of its election to exercise such option on or before the
first Business Day prior to the Required Prepayment Date shall be deemed to
have elected, as of such date, not to exercise such option).  On the Required Prepayment Date, Company
shall pay to Administrative Agent the amount of the Waivable Mandatory
Prepayment, which amount shall be applied (i) in an amount equal to that
portion of the Waivable Mandatory Prepayment payable to those Lenders that have
elected not to exercise such option, to prepay the Tranche B Term Loans, and
Tranche C Term Loans of such Lenders (which prepayment shall be applied to the
scheduled Installments of principal of the Tranche B Term Loans, and Tranche C
Term Loans in accordance with Section 2.15(b)), and (ii) in an amount equal to
that portion of the Waivable Mandatory Prepayment otherwise payable to those
Lenders that have elected to exercise such option, to prepay the Tranche A Term
Loans (which prepayment shall be applied to the scheduled installments of
principal of the Tranche A Term Loans in accordance with Section 2.15(b)).

 

(d)                                 Application
of Prepayments of Loans to Base Rate Loans and Eurodollar Rate Loans.  Considering each Class of Loans being
prepaid separately, any prepayment thereof shall

 

 

be applied first to Base
Rate Loans to the full extent thereof before application to Eurodollar Rate Loans,
in each case in a manner which minimizes the amount of any payments required to
be made by Company pursuant to Section 2.18(c).

 

2.16.                     General Provisions Regarding
Payments.

 

(a)                                  All
payments by Company of principal, interest, fees and other Obligations shall be
made in Dollars in same day funds, without defense, setoff or counterclaim,
free of any restriction or condition, and delivered to Administrative Agent not
later than 12:00 p.m. (New York City time) on the date due at the
Administrative Agent’s Principal Office for the account of Lenders; funds
received by Administrative Agent after that time on such due date shall be
deemed to have been paid by Company on the next succeeding Business Day.

 

(b)                                 All
payments in respect of the principal amount of any Loan (other than voluntary
prepayments of Revolving Loans) shall include payment of accrued interest on
the principal amount being repaid or prepaid, and all such payments (and, in
any event, any payments in respect of any Loan on a date when interest is due
and payable with respect to such Loan) shall be applied to the payment of
interest before application to principal.

 

(c)                                  Administrative
Agent shall promptly distribute to each Lender at such address as such Lender
shall indicate in writing, such Lender’s applicable Pro Rata Share of all
payments and prepayments of principal and interest due hereunder, together with
all other amounts due thereto, including, without limitation, all fees payable
with respect thereto, to the extent received by Administrative Agent.

 

(d)                                 Notwithstanding
the foregoing provisions hereof, if any Conversion/Continuation Notice is
withdrawn as to any Affected Lender or if any Affected Lender makes Base Rate
Loans in lieu of its Pro Rata Share of any Eurodollar Rate Loans, Administrative
Agent shall give effect thereto in apportioning payments received thereafter.

 

(e)                                  Subject
to the provisos set forth in the definition of “Interest Period”, whenever any
payment to be made hereunder shall be stated to be due on a day that is not a
Business Day, such payment shall be made on the next succeeding Business Day
and such extension of time shall be included in the computation of the payment
of interest hereunder or of the Revolving Commitment fees hereunder.

 

(f)                                    Administrative
Agent shall deem any payment by or on behalf of Company hereunder that is not
made in same day funds prior to 12:00  p.m. (New York City time) to be a
non-conforming payment.  Any such
payment shall not be deemed to have been received by Administrative Agent until
the later of (i) the time such funds become available funds, and (ii) the
applicable next Business Day. 
Administrative Agent shall give prompt telephonic notice to Company and
each applicable Lender (confirmed in writing) if any payment is non-conforming.  Any non-conforming payment may constitute or
become a Default or Event of Default in

 

 

accordance with the terms
of Section 8.1(a).  Interest shall
continue to accrue on any principal as to which a non-conforming payment is
made until such funds become available funds (but in no event less than the
period from the date of such payment to the next succeeding applicable Business
Day) at the rate determined pursuant to Section 2.10 from the date such amount
was due and payable until the date such amount is paid in full.

 

(g)                                 If
an Event of Default shall have occurred and not otherwise been waived, and the
maturity of the Obligations shall have been accelerated pursuant to Section
8.1, all payments or proceeds received by Agents hereunder in respect of any of
the Obligations, shall be applied in accordance with the application
arrangements described in Section 6.5 of the Pledge and Security Agreement.

 

2.17.                     Ratable Sharing.  Lenders hereby agree among themselves that,
except as otherwise provided in the Collateral Documents with respect to
amounts realized from the exercise of rights with respect to Liens on the
Collateral, if any of them shall, whether by voluntary payment (other than a
voluntary prepayment of Loans made and applied in accordance with the terms
hereof), through the exercise of any right of set-off or banker’s lien, by
counterclaim or cross action or by the enforcement of any right under the
Credit Documents or otherwise, or as adequate protection of a deposit treated
as cash collateral under the Bankruptcy Code, receive payment or reduction of a
proportion of the aggregate amount of principal, interest, amounts payable in
respect of Letters of Credit, fees and other amounts then due and owing to such
Lender hereunder or under the other Credit Documents (collectively, the “Aggregate
Amounts Due” to such Lender) which is greater than the proportion
received by any other Lender in respect of the Aggregate Amounts Due to such
other Lender, then the Lender receiving such proportionately greater payment
shall (a) notify Administrative Agent and each other Lender of the receipt of
such payment and (b) apply a portion of such payment to purchase participations
(which it shall be deemed to have purchased from each seller of a participation
simultaneously upon the receipt by such seller of its portion of such payment)
in the Aggregate Amounts Due to the other Lenders so that all such recoveries
of Aggregate Amounts Due shall be shared by all Lenders in proportion to the
Aggregate Amounts Due to them; provided, if all or part of such
proportionately greater payment received by such purchasing Lender is
thereafter recovered from such Lender upon the bankruptcy or reorganization of
Company or otherwise, those purchases shall be rescinded and the purchase prices
paid for such participations shall be returned to such purchasing Lender
ratably to the extent of such recovery, but without interest.  Company expressly consents to the foregoing
arrangement and agrees that any holder of a participation so purchased may
exercise any and all rights of banker’s lien, set-off or counterclaim with
respect to any and all monies owing by Company to that holder with respect
thereto as fully as if that holder were owed the amount of the participation
held by that holder.

 

2.18.                     Making or Maintaining Eurodollar Rate
Loans.

 

(a)                                  Inability
to Determine Applicable Interest Rate. 
In the event that Administrative Agent shall have determined (which
determination shall be conclusive and binding upon all

 

 

parties hereto, absent
manifest error), on any Interest Rate Determination Date with respect to any
Eurodollar Rate Loans, that by reason of circumstances affecting the London
interbank market adequate and fair means do not exist for ascertaining the
interest rate applicable to such Loans on the basis provided for in the
definition of Adjusted Eurodollar Rate, Administrative Agent shall on such date
give notice (by telefacsimile or by telephone confirmed in writing) to Company
and each Lender of such determination, whereupon (i) no Loans must be made as,
or converted to, Eurodollar Rate Loans until such time as Administrative Agent
notifies Company and Lenders (which it shall do promptly) that the
circumstances giving rise to such notice no longer exist, and (ii) Company
shall have the option to rescind any Funding Notice or Conversion/Continuation
Notice given by Company with respect to the Loans in respect of which such
determination was made.

 

(b)                                 Illegality
or Impracticability of Eurodollar Rate Loans.  In the event that on any date any Lender shall have determined
(which determination shall be conclusive and binding upon all parties hereto,
absent manifest error but shall be made only after consultation with Company
and Administrative Agent) that the making, maintaining or continuation of its
Eurodollar Rate Loans (i) has become unlawful as a result of compliance by such
Lender in good faith with any law, treaty, governmental rule, regulation,
guideline or order or (ii) has become impracticable, as a result of
contingencies occurring after the date hereof which materially and adversely
affect the London interbank market making Dollar deposits in the relevant
amounts and for the relevant Interest Period unavailable in such market, then,
and in any such event, such Lender shall be an “Affected Lender” and it
shall on that day give notice (by telefacsimile or by telephone confirmed in
writing) to Company and Administrative Agent of such determination (which
notice Administrative Agent shall promptly transmit to each other Lender).  Thereafter (1) the obligation of the
Affected Lender to make Loans as, or to convert Loans to, Eurodollar Rate Loans
shall be suspended until such notice shall be withdrawn by the Affected Lender
(which it shall do promptly), (2) to the extent such determination by the
Affected Lender relates to a Eurodollar Rate Loan then being requested by
Company pursuant to a Funding Notice or a Conversion/Continuation Notice, the
Affected Lender shall make such Loan as (or continue such Loan as or convert
such Loan to, as the case may be) a Base Rate Loan, (3) the Affected Lender’s
obligation to maintain its outstanding Eurodollar Rate Loans (the “Affected
Loans”) shall be terminated at the earlier to occur of the
expiration of the Interest Period then in effect with respect to the Affected
Loans or when required by law, and (4) the Affected Loans shall automatically
convert into Base Rate Loans on the date of such termination.  Notwithstanding the foregoing, to the extent
a determination by an Affected Lender as described above relates to a
Eurodollar Rate Loan then being requested by Company pursuant to a Funding
Notice or a Conversion/Continuation Notice, Company shall have the option,
subject to the provisions of Section 2.18(c), to rescind such Funding Notice or
Conversion/Continuation Notice as to all Lenders by giving notice (by
telefacsimile or by telephone confirmed in writing) to Administrative Agent of
such rescission on the date on which the Affected Lender gives notice of its
determination as described above (which notice of rescission Administrative
Agent shall promptly transmit to each other Lender).  Except as provided in the immediately preceding sentence, nothing
in this Section 2.18(b) shall affect the obligation of any Lender other than an

 

 

Affected Lender to make
or maintain Loans as, or to convert Loans to, Eurodollar Rate Loans in
accordance with the terms hereof.

 

(c)                                  Compensation
for Breakage or Non-Commencement of Interest Periods.  Company shall compensate each Lender, within
30 days written request by such Lender (which request shall set forth the basis
for requesting such amounts in reasonable detail), for all reasonable losses,
expenses and liabilities (including any interest paid by such Lender to lenders
of funds borrowed by it to make or carry its Eurodollar Rate Loans and any
loss, expense or liability sustained by such Lender in connection with the
liquidation or re-employment of such funds but excluding loss of anticipated
profits) which such Lender actually incurs: (i) if for any reason (other than a
default by such Lender) a borrowing of any Eurodollar Rate Loan does not occur
on a date specified therefor in a Funding Notice or a telephonic request for
borrowing, or a conversion to or continuation of any Eurodollar Rate Loan does
not occur on a date specified therefor in a Conversion/Continuation Notice or a
telephonic request for conversion or continuation; (ii) if any prepayment or
other principal payment or any conversion of any of its Eurodollar Rate Loans
occurs on a date prior to the last day of an Interest Period applicable to that
Loan; or (iii) if any prepayment of any of its Eurodollar Rate Loans is not
made on any date specified in a notice of prepayment given by Company.

 

(d)                                 Booking
of Eurodollar Rate Loans.  Any
Lender may make, carry or transfer Eurodollar Rate Loans at, to, or for the
account of any of its branch offices or the office of an Affiliate of such
Lender.

 

2.19.                     Increased Costs; Capital Adequacy.

 

(a)                                  Compensation
For Increased Costs and Taxes. 
Subject to the provisions of Section 2.20 (which shall be controlling
with respect to the matters covered thereby), in the event that any Lender
(which term shall include Issuing Bank for purposes of this Section 2.19(a))
shall determine in good faith that any law, treaty or governmental rule,
regulation or order, or any change therein or in the interpretation,
administration or application thereof (including the introduction of any new
law, treaty or governmental rule, regulation or order), or any determination of
a court or governmental authority, in each case first made after the date
hereof, or compliance by such Lender with any guideline, request or directive
first issued or made after the date hereof by any central bank or other
governmental or quasi-governmental authority (whether or not having the force
of law): (i) subjects such Lender (or its applicable lending office) to any
additional Tax (other than any Tax on the overall net income of such Lender)
with respect to this Agreement or any of its obligations hereunder or any
payments to such Lender (or its applicable lending office) of principal,
interest, fees or any other amount payable hereunder; (ii) imposes, modifies or
holds applicable any reserve (including any marginal, emergency, supplemental,
special or other reserve), special deposit, compulsory loan, FDIC insurance or
similar requirement against assets held by, or deposits or other liabilities in
or for the account of, or advances or loans by, or other credit extended by, or
any other acquisition of funds by, any office of such Lender (other than any
such reserve or other requirements with respect to

 

 

Eurodollar Rate Loans
that are reflected in the definition of Adjusted Eurodollar Rate); or (iii)
imposes any other condition (other than with respect to a Tax matter) on or
affecting such Lender (or its applicable lending office) or its obligations
hereunder or the London interbank market; and the result of any of the
foregoing is to increase the cost to such Lender of agreeing to make, making or
maintaining Loans hereunder or to reduce any amount received or receivable by
such Lender (or its applicable lending office) with respect thereto; then, in
any such case, Company shall pay to such Lender, within 30 days after receipt
of the statement referred to in the next sentence, such additional amount or
amounts as may be necessary to compensate such Lender for any such increased
cost or reduction in amounts received or receivable hereunder.  Such Lender shall deliver to Company (with a
copy to Administrative Agent) a written statement, setting forth in reasonable
detail the basis for calculating the additional amounts owed to such Lender
under this Section 2.19(a), which statement shall be conclusive and binding
upon all parties hereto absent manifest error.

 

(b)                                 Capital
Adequacy Adjustment.  In the event
that any Lender (which term shall include Issuing Bank for purposes of this
Section  2.19(b)) shall have determined
that the adoption, after the Closing Date of any law, rule or regulation (or
any provision thereof) regarding capital adequacy, or any change therein or in
the interpretation or administration thereof by any Governmental Authority,
central bank or comparable agency charged with the interpretation or
administration thereof, or compliance by any Lender (or its applicable lending
office) with any guideline, request or directive regarding capital adequacy
(whether or not having the force of law) of any such Governmental Authority,
central bank or comparable agency in each case first made after the date hereof,
has or would have the effect of reducing the rate of return on the capital of
such Lender or any corporation controlling such Lender as a consequence of, or
with reference to, such Lender’s Loans or Revolving Commitments or Letters of
Credit, or participations therein or other obligations hereunder with respect
to the Loans or the Letters of Credit to a level below that which such Lender
or such controlling corporation could have achieved but for such adoption,
change or compliance (taking into consideration the policies of such Lender or
such controlling corporation with regard to capital adequacy), then from time
to time, within thirty Business Days after receipt by Company from such Lender
of the statement referred to in the next sentence, Company shall pay to such
Lender such additional amount or amounts as will compensate such Lender or such
controlling corporation on an after-tax basis for such reduction. Such Lender
shall deliver to Company (with a copy to Administrative Agent) a written
statement, setting forth in reasonable detail the basis for calculating the
additional amounts owed to Lender under this Section 2.19(b), which statement
shall be conclusive and binding upon all parties hereto absent manifest error.

 

2.20.                     Taxes; Withholding, etc.

 

(a)                                  Payments
to Be Free and Clear.  All sums
payable by any Credit Party hereunder and under the other Credit Documents
shall (except to the extent required by law) be paid free and clear of, and
without any deduction or withholding on account of, any Tax (other than a Tax
on the overall net income of any Lender) imposed, levied, collected, withheld
or assessed by or

 

 

within the United States
of America or any political subdivision in or of the United States of America
or any other jurisdiction from or to which a payment is made by or on behalf of
any Credit Party or by any federation or organization of which the United
States of America or any such jurisdiction is a member at the time of payment.

 

(b)                                 Withholding
of Taxes.  If any Credit Party or
any other Person is required by law to make any deduction or withholding on
account of any such Tax from any sum paid or payable by any Credit Party to
Administrative Agent or any Lender (which term shall include Issuing Bank for
purposes of this Section 2.20(b)) under any of the Credit Documents: (i)
Company shall notify Administrative Agent of any such requirement or any change
in any such requirement as soon as Company becomes aware of it; (ii) Company
shall pay any such Tax before the date on which penalties attach thereto, such
payment to be made (if the liability to pay is imposed on any Credit Party) for
its own account or (if that liability is imposed on Administrative Agent or
such Lender, as the case may be) on behalf of and in the name of Administrative
Agent or such Lender; (iii) the sum payable by such Credit Party in respect of
which the relevant deduction, withholding or payment is required shall be
increased to the extent necessary to ensure that, after the making of that
deduction, withholding or payment, Administrative Agent or such Lender, as the
case may be, receives on the due date a net sum equal to what it would have
received had no such deduction, withholding or payment been required or made;
and (iv) within thirty (30) days after paying any sum from which it is required
by law to make any deduction or withholding, and within thirty (30) days after
the due date of payment of any Tax which it is required by clause (ii) above to
pay, Company shall deliver to Administrative Agent evidence satisfactory to the
other affected parties of such deduction, withholding or payment and of the
remittance thereof to the relevant taxing or other authority; provided,
no such additional amount shall be required to be paid to any Lender under
clause (iii) above except to the extent that any change after the date hereof
(in the case of each Lender listed on the signature pages hereof on the Closing
Date) or after the effective date of the Assignment Agreement pursuant to which
such Lender became a Lender (in the case of each other Lender) in any such
requirement for a deduction, withholding or payment as is mentioned therein
shall result in an increase in the rate of such deduction, withholding or
payment from that in effect at the date hereof or at the date of such Assignment
Agreement, as the case may be, in respect of payments to such Lender.

 

(c)                                  Evidence
of Exemption From U.S. Withholding Tax. 
Each Lender that is not a United States Person (as such term is defined
in Section 7701(a)(30) of the Internal Revenue Code) for U.S. federal income
tax purposes (a “Non-US Lender”) shall deliver to Administrative Agent for
transmission to Company, on or prior to the Closing Date (in the case of each
Lender listed on the signature pages hereof on the Closing Date) or on or prior
to the date of the Assignment Agreement pursuant to which it becomes a Lender
(in the case of each other Lender), and at such other times as may be necessary
in the determination of Company or Administrative Agent (each in the reasonable
exercise of its discretion), (i) two original copies of Internal Revenue
Service Form W-8BEN or W-8ECI (or any successor forms), properly completed and
duly executed by such Lender, and such other documentation required under the
Internal Revenue Code and reasonably requested by Company to establish that
such Lender is not

 

 

subject to deduction or
withholding of United States federal income tax with respect to any payments to
such Lender of principal, interest, fees or other amounts payable under any of
the Credit Documents, or (ii) if such Lender is not a “bank” or other Person
described in Section 881(c)(3) of the Internal Revenue Code and cannot deliver
either Internal Revenue Service Form W-8BEN or W-8ECI pursuant to clause (i)
above, a Certificate re Non-Bank Status together with two original copies of
Internal Revenue Service Form W-8 (or any successor form), properly completed
and duly executed by such Lender, and such other documentation required under
the Internal Revenue Code and reasonably requested by Company to establish that
such Lender is not subject to deduction or withholding of United States federal
income tax with respect to any payments to such Lender of interest payable
under any of the Credit Documents.  Each
Lender required to deliver any forms, certificates or other evidence with
respect to United States federal income tax withholding matters pursuant to
this Section 2.20(c) hereby agrees, from time to time after the initial
delivery by such Lender of such forms, certificates or other evidence, whenever
a lapse in time or change in circumstances renders such forms, certificates or
other evidence obsolete or inaccurate in any material respect, that such Lender
shall promptly deliver to Administrative Agent for transmission to Company two
new original copies of Internal Revenue Service Form W-8BEN or W-8ECI, or a
Certificate re Non-Bank Status and two original copies of Internal Revenue
Service Form W-8, as the case may be, properly completed and duly executed by
such Lender, and such other documentation required under the Internal Revenue
Code and reasonably requested by Company to confirm or establish that such
Lender is not subject to deduction or withholding of United States federal
income tax with respect to payments to such Lender under the Credit Documents,
or notify Administrative Agent and Company of its inability to deliver any such
forms, certificates or other evidence. 
Company shall not be required to pay any additional amount to any Non-US
Lender under Section 2.20(b)(iii) if such Lender shall have failed (1) to
deliver the forms, certificates or other evidence referred to in the second
sentence of this Section 2.20(c), or (2) to notify Administrative Agent and
Company of its inability to deliver any such forms, certificates or other evidence,
as the case may be; provided, if such Lender shall have satisfied the
requirements of the first sentence of this Section 2.20(c) on the Closing Date
or on the date of the Assignment Agreement pursuant to which it became a
Lender, as applicable, nothing in this last sentence of Section 2.20(c) shall
relieve Company of its obligation to pay any additional amounts pursuant to
Section 2.19(a) in the event that, as a result of any change in any applicable
law, treaty or governmental rule, regulation or order, or any change in the
interpretation, administration or application thereof first made after the date
hereof or after the date such Person first became a Lender, such Lender is no
longer properly entitled to deliver forms, certificates or other evidence at a
subsequent date establishing the fact that such Lender is not subject to
withholding as described herein.

 

2.21.                     Obligation to Mitigate.  Each
Lender (which term shall include Issuing Bank for purposes of this Section
2.21) agrees that, as promptly as practicable after the officer of such Lender
responsible for administering its Loans or Letters of Credit, as the case may
be, becomes aware of the occurrence of an event or the existence of a condition
that would cause such Lender to become an Affected Lender or that would entitle
such Lender to receive payments under Section 2.18, 2.19 or 2.20, it will, to
the extent not inconsistent with the internal policies of such

 

 

Lender and any applicable legal or regulatory restrictions, use
reasonable efforts to (a) make, issue, fund or maintain its Credit Extensions,
including any Affected Loans, through another office of such Lender, or (b)
take such other reasonable measures, if as a result thereof the circumstances
which would cause such Lender to be an Affected Lender would cease to exist or
the additional amounts which would otherwise be required to be paid to such
Lender pursuant to Section 2.18, 2.19 or 2.20 would be materially reduced and
if, as determined by such Lender in its reasonable discretion, the making,
issuing, funding or maintaining of such Revolving Commitments, Loans or Letters
of Credit through such other office or in accordance with such other measures,
as the case may be, would not otherwise adversely affect such Revolving
Commitments, Loans or Letters of Credit or the interests of such Lender; provided,
such Lender will not be obligated to utilize such other office pursuant to this
Section 2.21 unless Company agrees to pay all incremental and documented`
expenses actually and reasonably incurred by such Lender as a result of
utilizing such other office as described in clause (i) above.  A certificate as to the amount of any such
expenses payable by Company pursuant to this Section 2.21 (setting forth in
reasonable detail the basis for requesting such amount) submitted by such
Lender to Company (with a copy to Administrative Agent) shall be conclusive
absent manifest error.

 

2.22.                     Defaulting Lenders.  Anything
contained herein to the contrary notwithstanding, in the event that any Lender
defaults (a “Defaulting Lender”) in its obligation to fund (a “Funding
Default”) any Revolving Loan or its portion of any unreimbursed
payment under Section 2.3(b)(iv) or 2.4(e) (in each case, a “Defaulted
Loan”), then (a) during any Default Period with respect to such
Defaulting Lender, such Defaulting Lender shall be deemed not to be a “Lender”
for purposes of voting on any matters (including the granting of any consents
or waivers) with respect to any of the Credit Documents; (b) to the extent
permitted by applicable law, until such time as the Default Excess with respect
to such Defaulting Lender shall have been reduced to zero, (i) any voluntary
prepayment of the Revolving Loans shall, if Company so directs at the time of
making such voluntary prepayment, be applied to the Revolving Loans of other
Lenders as if such Defaulting Lender had no Revolving Loans outstanding and the
Revolving Exposure of such Defaulting Lender were zero, and (ii) any mandatory
prepayment of the Revolving Loans shall, if Company so directs at the time of
making such mandatory prepayment, be applied to the Revolving Loans of other
Lenders (but not to the Revolving Loans of such Defaulting Lender) as if such
Defaulting Lender had funded all Defaulted Loans of such Defaulting Lender, it
being understood and agreed that Company shall be entitled to retain any
portion of any mandatory prepayment of the Revolving Loans that is not paid to
such Defaulting Lender solely as a result of the operation of the provisions of
this clause (b); (c) such Defaulting Lender’s Revolving Commitment and
outstanding Revolving Loans and such Defaulting Lender’s Pro Rata Share of the
Letter of Credit Usage shall be excluded for purposes of calculating the
Revolving Commitment fee payable to Lenders in respect of any day during any
Default Period with respect to such Defaulting Lender, and such Defaulting
Lender shall not be entitled to receive any Revolving Commitment fee pursuant
to Section 2.11 with respect to such Defaulting Lender’s Revolving Commitment in
respect of any Default Period with respect to such Defaulting Lender; and (d)
the Total Utilization of Revolving Commitments as at any date of determination
shall be calculated as if such Defaulting Lender had funded all Defaulted Loans
of such Defaulting

 

 

Lender.  No Revolving Commitment
of any Lender shall be increased or otherwise affected, and, except as
otherwise expressly provided in this Section 2.22, performance by Company of
its obligations hereunder and the other Credit Documents shall not be excused
or otherwise modified as a result of any Funding Default or the operation of
this Section 2.22.  The rights and
remedies against a Defaulting Lender under this Section 2.22 are in addition to
other rights and remedies which Company may have against such Defaulting Lender
with respect to any Funding Default and which Administrative Agent or any
Lender may have against such Defaulting Lender with respect to any Funding
Default.

 

2.23.                     Removal or Replacement of a Lender.  Anything contained herein to the contrary
notwithstanding, in the event that: (a) any Lender (an “Increased-Cost Lender”)
shall give notice to Company that such Lender is an Affected Lender or that
such Lender is entitled to receive payments under Section  2.18, 2.19 or 2.20, the circumstances which
have caused such Lender to be an Affected Lender or which entitle such Lender
to receive such payments shall remain in effect, and such Lender shall fail to
withdraw such notice within five Business Days after Company’s request for such
withdrawal; or (b) any Lender shall become a Defaulting Lender, the Default
Period for such Defaulting Lender shall remain in effect, and such Defaulting
Lender shall fail to cure the default as a result of which it has become a
Defaulting Lender within five Business Days after Company’s request that it
cure such default; or (c) in connection with any proposed amendment,
modification, termination, waiver or consent with respect to any of the
provisions hereof as contemplated by Section 10.5(b), the consent of Requisite
Lenders shall have been obtained but the consent of one or more of such other
Lenders (each a “Non-Consenting Lender”) whose consent is required shall not
have been obtained; then, with respect to each such Increased-Cost Lender,
Defaulting Lender or Non-Consenting Lender (the “Terminated Lender”), Company
may, by giving written notice to Administrative Agent and any Terminated Lender
of its election to do so, elect to cause such Terminated Lender (and such
Terminated Lender hereby irrevocably agrees) to assign its outstanding Loans
and its Revolving Commitments, if any, in full to one or more Eligible
Assignees (each a “Replacement Lender”) in accordance with
the provisions of Section 10.6 and Terminated Lender shall pay any fees payable
thereunder in connection with such assignment; provided, (1) on the date
of such assignment, the Replacement Lender shall pay to Terminated Lender an
amount equal to the sum of (A) an amount equal to the principal of, and all
accrued interest on, all outstanding Loans of the Terminated Lender, (B) an
amount equal to all unreimbursed drawing that have been funded by such
Terminated Lender, together with all then unpaid interest with respect thereto
at such time and (C) an amount equal to all accrued, but theretofore unpaid
fees owing to such Terminated Lender pursuant to Section 2.11; (2) on the date
of such assignment, Company shall pay any amounts payable to such Terminated
Lender pursuant to Section 2.18(c), 2.19 or 2.20 or otherwise as if it were a
prepayment; and (3) in the event such Terminated Lender is a Non-Consenting
Lender, each Replacement Lender shall consent, at the time of such assignment,
to each matter in respect of which such Terminated Lender was a Non-Consenting
Lender; provided, Company may not make such election with respect to any
Terminated Lender that is also an Issuing Bank unless, prior to the
effectiveness of such election, Company shall have caused each outstanding
Letter of Credit issued thereby to be cancelled or transferred to a new

 

 

Issuing Bank.  Upon the
prepayment of all amounts owing to any Terminated Lender and the termination of
such Terminated Lender’s Revolving Commitments, if any, such Terminated Lender
shall no longer constitute a “Lender” for purposes hereof; provided, any
rights of such Terminated Lender to indemnification hereunder shall survive as
to such Terminated Lender.

 

SECTION 3.  CONDITIONS
PRECEDENT

 

3.1.                            Closing Date.  The obligation of any Lender to make a
Credit Extension on the Closing Date is subject to the satisfaction, or waiver,
of the following conditions on or before the Closing Date:

 

(a)                                  Credit
Documents.  Administrative Agent
shall have received sufficient copies of each Credit Document originally
executed and delivered by each applicable Credit Party for each Lender.

 

(b)                                 Organizational
Documents; Incumbency. 
Administrative Agent shall have received (i) sufficient copies of each
Organizational Document originally executed and delivered by each Credit Party,
as applicable, and, to the extent applicable, certified as of a recent date by
the appropriate governmental official, for each Lender; (ii) signature and
incumbency certificates of the officers of such Person executing the Credit
Documents to which it is a party; (iii) resolutions of the Board of Directors
or similar governing body of each Credit Party approving and authorizing the
execution, delivery and performance of this Agreement and the other Credit
Documents and the Related Agreements to which it is a party or by which it or
its assets may be bound as of the Closing Date, certified as of the Closing
Date by its secretary or an assistant secretary as being in full force and
effect without modification or amendment; and (iv) a good standing certificate
from the applicable Governmental Authority of each Credit Party’s jurisdiction
of incorporation, organization or formation and in each jurisdiction in which
it is qualified as a foreign corporation or other entity to do business, each
dated a recent date prior to the Closing Date.

 

(c)                                  Organizational
and Capital Structure.  The
organizational structure and capital structure of Holdings and its Subsidiaries
as of the Closing Date, shall be as set forth on Schedule 4.1.

 

(d)                                 Capitalization
of Holdings and Company.  On or
before the Closing Date:

 

(i)                                     Holdings
shall have issued to Seller the Holdings Notes as contemplated by the
Acquisition Agreement.

 

(ii)                                  Sponsor
and/or its Affiliates and Permitted Investors shall have purchased common stock
of Holdings for an aggregate cash purchase price of at least $172,000,000 and
the proceeds thereof shall have been irrevocably committed in full to pay a
portion of the cash

 

 

purchase price to be paid
in connection with the Acquisition.

 

(e)                                  Consummation
of Acquisition.

 

As of the Closing Date:

 

(i) (1) All conditions to consummation of the
Acquisition set forth in Article III of the Acquisition Agreement shall have
been satisfied in all material respects or the fulfillment of any such material
conditions shall have been waived with the consent of Syndication Agent and
Administrative Agent, (2) the Acquisition shall have become effective in
accordance with the terms of the Acquisition Agreement and (3) the aggregate
cash consideration paid to Seller on the Closing Date in connection with the
Acquisition shall not exceed $668,000,000.

 

(ii)                                  Syndication
Agent and Administrative Agent shall have received a fully executed or
conformed copy of each Related Agreement, together with copies of each of the
opinions of counsel delivered to the parties under the Acquisition Agreement,
authorizing or accompanied by a letter from each such counsel (to the extent
not inconsistent with such counsel’s established internal policies) authorizing
Lenders to rely upon such opinion to the same extent as though it were
addressed to Lenders.  Each Related
Agreement shall be in full force and effect, and no provision thereof shall
have been modified or waived in any manner materially adverse to Lenders, in
each case without the consent of Syndication Agent and Administrative Agent.

 

(f)                                    Existing
Indebtedness.  On the Closing Date,
Holdings and its Subsidiaries shall have repaid in full all Indebtedness of
Holdings and its Subsidiaries and the Acquired Business (other than
Indebtedness described on Schedule 6.1).

 

(g)                                 Closing
Date Certificate.  Holdings and
Company shall have delivered to Syndication Agent and Administrative Agent an
originally executed Closing Date Certificate, together with all attachments
thereto.

 

(h)                                 Governmental
Authorizations and Consents.  Each
Credit Party shall have obtained all material Governmental Authorizations and
all material consents of other Persons, in each case that are reasonably
necessary in connection with the transactions contemplated by the Credit
Documents and the Related Agreements and each of the foregoing shall be in full
force and effect.  All applicable
waiting periods shall have expired or been terminated without any action being
taken by any competent authority which would restrain or prevent the material transactions
contemplated by the Credit Documents or the Related Agreements or the financing
thereof and (except as otherwise disclosed to the Agents) no action, request
for stay, petition for review or rehearing, reconsideration, or appeal with
respect to any of the foregoing shall be pending, and the time for any
applicable agency to take action to set aside its consent on its own motion
shall have expired.

 

 

(i)                                     Real
Estate Assets.  In order to create
in favor of Collateral Agent, for the benefit of Secured Parties, a valid and,
subject to any filing and/or recording referred to herein, perfected First
Priority security interest in certain Real Estate Assets, Collateral Agent
shall have received from Company and each applicable Guarantor:

 

(i)                                     fully
executed and notarized Mortgages, in proper form for recording in all
appropriate places in all applicable jurisdictions, encumbering each Real
Estate Asset listed on Schedule 3.1(i) (each, a “Closing Date Mortgaged Property’’);

 

(ii)                                  an
opinion of counsel (which counsel shall be reasonably satisfactory to
Collateral Agent) in each state in which a Closing Date Mortgaged Property is
located with respect to the enforceability of the form(s) of Mortgages to be
recorded in such state and such other matters as Collateral Agent may
reasonably request, in each case in form and substance reasonably satisfactory
to Collateral Agent;

 

(iii)                               (a)                                  ALTA mortgagee title
insurance policies or unconditional commitments therefor issued by one or more
title companies reasonably satisfactory to Collateral Agent (each, a “Title
Policy”) with respect to each Closing Date Mortgaged Property, in
amounts reasonably satisfactory to Collateral Agent and the Administrative
Agent, together with a title report issued by a title company with respect
thereto, dated not more than thirty (30) days prior to the Closing Date and
copies of all recorded documents listed as exceptions to title or otherwise
referred to therein, each in form and substance reasonably satisfactory to
Collateral Agent and (B) evidence satisfactory to Collateral Agent that such
Credit Party has paid, or made arrangements to pay, to the title company or to
the appropriate governmental authorities all expenses and premiums of the title
company and all other sums required in connection with the issuance of each Title
Policy and all recording and stamp taxes (including mortgage recording and
intangible taxes) payable in connection with recording the Mortgages for each
Closing Date Mortgaged Property in the appropriate real estate records;

 

(iv)                              evidence
of flood insurance with respect to each Flood Hazard Property that is located
in a community that participates in the National Flood Insurance Program, in
each case in compliance with and to the extent required by law or any
applicable regulations of the Board of Governors of the Federal Reserve System,
in form and substance reasonably satisfactory to Collateral Agent; and

 

(j)                                     Personal
Property Collateral.  In order to
create in favor of Collateral Agent, for the benefit of Secured Parties, a
valid, perfected First Priority security interest in the personal property
Collateral, Collateral Agent shall have received:

 

(i)                                     evidence
satisfactory to the Collateral Agent of the compliance by each Credit Party of
their obligations under the Pledge and Security Agreement and the other
Collateral Documents.

 

 

(ii)                                  evidence
satisfactory to the Collateral Agent that it has a First Priority perfected
security interest in all of the Collateral (except as otherwise contemplated by
the Pledge and Security Agreement and Section 5.15 of this Agreement) subject
to no Liens other than Permitted Liens. 
Such evidence may include, but shall not be limited to, searches of
appropriate UCC records, searches of the Patent and Trademark Office, searches
of appropriate foreign records and duly executed UCC or other termination
statements relating to the results of such searches.

 

(iii)                               A completed UCC
Questionnaire dated as of the Closing Date and executed by an Authorized
Officer of each Credit Party, together with all attachments contemplated thereby,
including (A) the results of a recent search, by a Person satisfactory to
Collateral Agent, of all effective UCC financing statements (or equivalent
filings) made with respect to any personal or mixed property of any Credit
Party in the jurisdiction specified in the UCC Questionnaire, together with all
attachments contemplated thereby, and (B) UCC termination statements (or
similar documents confirming cancellation or repayment of obligations) duly
executed by all applicable Persons for filing in all applicable jurisdictions
as may be necessary to terminate any effective UCC financing statements (or
equivalent filings) disclosed in such search (other than any such financing
statements in respect of Permitted Liens);

 

(iv)                              evidence
that each Credit Party shall have taken or caused to be taken any other action,
executed and delivered or caused to be executed and delivered any other
agreement, document and instrument (including without limitation a Consent to
Assignment by the counterparty to the material contracts identified on Schedule
3.1(j), unless otherwise indicated on such Schedule 3.1(j)) and made or caused
to be made any other filing and recording (other than as set forth herein)
reasonably required by Collateral Agent.

 

(k)                                  Environmental
Reports.  Syndication Agent and
Administrative Agent shall have received reports and other information, in
form, scope and substance satisfactory to Syndication Agent and Administrative
Agent, regarding environmental matters relating to the Facilities.

 

(l)                                     Financial
Statements; Projections.  Lenders
shall have received from Holdings (i) the Historical Financial Statements, (ii)
pro forma consolidated balance sheets of Holdings and its Subsidiaries as at
June 30, 2000, and reflecting the consummation of the Acquisition, the related
financings and the other transactions contemplated by the Credit Documents to
occur on or prior to the Closing Date, and (iii) the Projections.

 

(m)                               Evidence
of Insurance.  Syndication Agent and
Administrative Agent shall have received a certificate from Company’s insurance
broker or other evidence satisfactory to it that all insurance required to be
maintained pursuant to Section 5.5 is in full force and effect and that
Administrative Agent, for the benefit of Lenders has been named as additional
insured and loss payee thereunder to the extent required under Section 5.5.

 

(n)                                 Opinions
of Counsel to Credit Parties. 
Lenders and their respective counsel shall

 

 

have received originally
executed copies of the favorable written opinions of Latham & Watkins,
counsel for Credit Parties, in substantially the form of Exhibit D, dated as of
the Closing Date and otherwise in form and substance reasonably satisfactory to
Administrative Agent and Syndication Agent.

 

(o)                                 Fees.  Company shall have paid to Syndication Agent
and Administrative Agent the fees payable on the Closing Date referred to in
Section 2.11(d).

 

(p)                                 Solvency
Certificate.  On the Closing Date,
Syndication Agent and Administrative Agent shall have received a Solvency
Certificate from Company satisfactory to Syndication Agent and Administrative
Agent, dated the Closing Date with appropriate attachments and demonstrating
that after giving effect to the consummation of the Acquisition, Holdings and
its Subsidiaries are and will be Solvent.

 

(q)                                 No
Litigation.  There shall not exist
any action, suit, investigation, litigation or proceeding, pending in any court
or before any arbitrator or Governmental Authority that materially impairs the
Acquisition or the financing thereof.

 

Each Lender, by delivering its signature page to this
Agreement and funding a Loan on the Closing Date, shall be deemed to have
acknowledged receipt of, and consented to and approved, each Credit Document
and each other document required to be approved by any Agent, Requisite Lenders
or Lenders, as applicable on the Closing Date.

 

3.2.                            Conditions to Each Credit Extension.

 

(a)                                  Conditions
Precedent.  The obligation of each
Lender to make any Loan, or Issuing Bank to issue any Letter of Credit, on any
Credit Date, including the Closing Date, are subject to the satisfaction, or
waiver in accordance with Section 10.5, of the following conditions precedent:

 

(i)                                     Administrative
Agent shall have received a fully executed and delivered Funding Notice or
Issuance Notice, as the case may be;

 

(ii)                                  after
making the Credit Extensions requested on such Credit Date, the Total
Utilization of Revolving Commitments shall not exceed the Revolving Commitments
then in effect;

 

(iii)                               as of such Credit Date,
the representations and warranties contained herein and in the other Credit
Documents shall be true and correct in all material respects on and as of that
Credit Date to the same extent as though made on and as of that date, except to
the extent such representations and warranties specifically relate to an
earlier date, in which case such representations and warranties shall have been
true and correct in all material respects only on and as of such earlier date;

 

 

(iv)                              as
of such Credit Date, no event shall have occurred and be continuing or would
result from the consummation of the applicable Credit Extension that would
constitute an Event of Default or a Default; and

 

(v)                                 on
or before the date of issuance of any Letter of Credit, Administrative Agent
shall have received all other information required by the applicable Issuance
Notice, and such other documents or information as Issuing Bank may reasonably
require in connection with the issuance of such Letter of Credit.

 

(b)                                 Notices.  Any Notice shall be executed by an
Authorized Officer in a writing delivered to Administrative Agent.  In lieu of delivering a Notice, Company may
give Administrative Agent telephonic notice by the required time of any
proposed borrowing, conversion/continuation or issuance of a Letter of Credit,
as the case may be; provided each such notice shall be promptly
confirmed in writing by delivery of the applicable Notice to Administrative
Agent on or before the applicable date of borrowing, continuation/conversion or
issuance.  Neither Administrative Agent
nor any Lender shall incur any liability to Company in acting upon any
telephonic notice referred to above that Administrative Agent believes in good
faith to have been given by a duly authorized officer or other person
authorized on behalf of Company or for otherwise acting in good faith.

 

SECTION 4.                            REPRESENTATIONS
AND WARRANTIES

 

In order to induce
Lenders and Issuing Bank to enter into this Agreement and to make each Credit
Extension to be made thereby, each Credit Party represents and warrants to each
Lender and Issuing Bank, on the Closing Date and on each Credit Date, that the
following statements are true and correct (it being understood and agreed that
the representations and warranties made on the Closing Date are deemed to be
made concurrently with the consummation of the Acquisition as contemplated
hereby):

 

4.1.                            Organization; Requisite Power and
Authority; Qualification.  Each of Holdings and its Subsidiaries (a) is
duly organized, validly existing and in good standing under the laws of its
jurisdiction of organization as identified in Schedule 4.1, (b) has all
requisite power and authority to own and operate its properties, to carry on
its business as now conducted and as proposed to be conducted (except where
failure to have such power and authority would not reasonably be expected to
have a Material Adverse Effect), to enter into the Credit Documents to which it
is a party and to carry out the transactions contemplated thereby, and (c) is
qualified to do business and in good standing in every jurisdiction necessary
to carry out its business and operations, except in jurisdictions where the
failure to be so qualified or in good standing has not had, and would not be
reasonably expected to have, a Material Adverse Effect.

 

4.2.                            Capital Stock  and Ownership.  The Capital Stock of each of Holdings and
its

 

 

Subsidiaries has been duly authorized and validly issued and is fully
paid and non-assessable.  Except as set
forth on Schedule 4.2, as of the date hereof, there is no existing option,
warrant, call, right, commitment or other agreement to which Holdings or any of
its Subsidiaries is a party requiring, and there is no membership interest or
other Capital Stock of Holdings or any of its Subsidiaries outstanding which
upon conversion or exchange would require, the issuance by Holdings or any of
its Subsidiaries of any additional membership interests or other Capital Stock
of Holdings or any of its Subsidiaries or other Securities convertible into,
exchangeable for or evidencing the right to subscribe for or purchase, a
membership interest or other Capital Stock of Holdings or any of its
Subsidiaries.  Schedule 4.2 correctly
sets forth the ownership interest of Holdings and each of its Subsidiaries in
their respective Subsidiaries as of the Closing Date.

 

4.3.                            Due Authorization.  The
execution, delivery and performance of the Credit Documents have been duly
authorized by all necessary action on the part of each Credit Party that is a
party thereto.

 

4.4.                            No Conflict.  The execution, delivery and performance by Credit
Parties of the Credit Documents to which they are parties and the consummation
of the transactions contemplated by the Credit Documents do not and will not
(a) violate any provision of any law or any governmental rule or regulation
applicable to Holdings or any of its Subsidiaries, any of the Organizational
Documents of Holdings or any of its Subsidiaries, or any order, judgment or
decree of any court or other agency of government binding on Holdings or any of
its Subsidiaries except to the extent such violation could not be reasonably
expected to have a Material Adverse Effect; (b) conflict with, result in a
breach of or constitute (with due notice or lapse of time or both) a default
under any Contractual Obligation of Holdings or any of its Subsidiaries except
to the extent such conflict, breach or default could not reasonably be expected
to have a Material Adverse Effect; (c) result in or require the creation or
imposition of any Lien upon any of the properties or assets of Holdings or any
of its Subsidiaries (other than any Liens created under any of the Credit
Documents in favor of Collateral Agent, on behalf of Secured Parties); or (d)
require any approval of stockholders, members or partners or any approval or
consent of any Person under any material Contractual Obligation of Holdings or
any of its Subsidiaries, except for such approvals or consents which will be
obtained on or before the Closing Date and disclosed in writing to Lenders.

 

4.5.                            Governmental Consents.  The
execution, delivery and performance by Credit Parties of the Credit Documents
to which they are parties and the consummation of the transactions contemplated
by the Credit Documents do not and will not require any registration with,
consent or approval of, or notice to, or other action to, with or by, any
Governmental Authority except as otherwise set forth in the Acquisition
Agreement, and except for filings and recordings with respect to the Collateral
to be made, or otherwise delivered to Collateral Agent for filing and/or recordation,
as of the Closing Date or as could not reasonably be expected to have a
Material Adverse Effect.

 

4.6.                            Binding Obligation.  Each
Credit Document has been duly executed and delivered by each Credit Party that
is a party thereto and is the legally valid and binding obligation of such
Credit

 

 

Party, enforceable
against such Credit Party in accordance with its respective terms, except as
may be limited by bankruptcy, insolvency, reorganization, moratorium or similar
laws relating to or limiting creditors’ rights generally or by equitable
principles relating to enforceability.

 

4.7.                            Historical Financial Statements.  Except as otherwise noted in the Historical
Financial Statements and except that certain disclosure requirements of GAAP
were not met, which noncompliance with GAAP would not materially impact the
accuracy of any amounts shown on the Income Statements or Financial Statement,
(a) the Financial Statement is complete and accurate and fairly presents in all
material respects the assets and liabilities of the Acquired Business as of
March 31,2000, and was prepared in accordance with GAAP; (b) the Income
Statements are complete and accurate and fairly present in all material
respects the results of the operations for all periods reflected therein and
the Income Statements for the Fiscal Year ended December 31, 1999 and the
Fiscal Quarter ended March 31, 2000, were prepared in accordance with GAAP; and
(c) the unaudited statement of cash flows for the Fiscal Year ended December
31, 1999 is complete and accurate and fairly presents in all material respects
the results of the cash flows for all periods reflected therein.  As of the Closing Date, neither Holdings nor
any of its Subsidiaries has any contingent liability or liability for taxes,
long-term lease or unusual forward or long-term commitment that is not
reflected in the Historical Financial Statements or the notes thereto or
otherwise disclosed in writing to Lenders on or before the Closing Date and
which in any such case is material in relation to the business, operations,
properties, assets, financial condition of Holdings and any of its Subsidiaries
taken as a whole.

 

4.8.                            Projections.  On and as of the Closing Date, the
Projections of Holdings and its Subsidiaries for the period Fiscal Year 2000
through and including Fiscal Year 2005 (the “Projections”) are based on
good faith estimates and assumptions made by the management of Holdings; provided,
the Projections are not to be viewed as facts and that actual results during
the period or periods covered by the Projections may differ from such
Projections and that the differences may be material.

 

4.9.                            No Material Adverse Change.  Since March 31, 2000, no event or change has
occurred that has caused or evidences, a Material Adverse Effect.

 

4.10.                     Adverse Proceedings, etc.  There are no Adverse Proceedings, individually or in the
aggregate, that could reasonably be expected to have a Material Adverse
Effect.  Neither Holdings nor any of its
Subsidiaries (a) is in violation of any applicable laws (including
Environmental Laws) that, individually or in the aggregate, could reasonably be
expected to have a Material Adverse Effect, or (b) is subject to or in default
with respect to any final judgments, writs, injunctions, or decrees, any court
or any federal, state, municipal or other governmental department, commission,
board, bureau, agency or instrumentality, domestic or foreign, that,
individually or in the aggregate, could reasonably be expected to have a
Material Adverse Effect.

 

4.11.                     Payment of Taxes.  Except as otherwise permitted under Section
5.3, all tax returns and reports of Holdings and its Subsidiaries required to
be filed by any of them have been timely

 

 

filed, and all taxes shown on such tax returns to be due and payable
and all assessments, fees and other governmental charges upon Holdings and its
Subsidiaries and upon their respective properties, assets, income, businesses
and franchises which are due and payable have been paid when due and payable,
except any such taxes, assessments, fees and charges which are being diligently
contested in good faith or the failure to pay could not reasonably be expected
to have a Material Adverse Effect.

 

4.12.                     Certain Properties.

 

(a)                                  Title.  Except as set forth in Schedule 4.12 each of
Holdings and its Subsidiaries has good, sufficient and legal title to all of
their respective real property assets reflected in their respective Historical
Financial Statements referred to in Section 4.7 and in the most recent
financial statements delivered pursuant to Section 5.1, in each case except for
assets disposed of since the date of such financial statements in the ordinary
course of business or as otherwise permitted under Section 6.9.  Except as permitted by this Agreement, all
such assets are free and clear of Liens.

 

(b)                                 Real
Estate.  As of the Closing Date,
Schedule 4.12 contains a true, accurate and complete list of (i) all Real
Estate Assets, and (ii) all leases, subleases or assignments of leases
(together with all material amendments, modifications, supplements, renewals or
extensions of any thereof) affecting each Real Estate Asset of any Credit
Party, regardless of whether such Credit Party is the landlord or tenant
(whether directly or as an assignee or successor in interest) under such lease,
sublease or assignment.

 

4.13.                     Environmental Matters.  Holdings
and each of its Subsidiaries are in compliance with all applicable
Environmental Laws (which compliance includes, but is not limited to, the
possession of all permits and other governmental authorizations required under
applicable Environmental Laws, and compliance with the terms and conditions
thereof), except where failure to be in compliance or to possess a permit or
other governmental authorization would not reasonably be expected to have a Material
Adverse Effect.  Neither Holdings nor
any of its Subsidiaries are subject to any outstanding written order, consent
decree or settlement agreement with any Person relating to any Environmental
Law, any Environmental Claim, or any Hazardous Materials Activity that,
individually or in the aggregate, could reasonably be expected to have a
Material Adverse Effect.  To each of
Holdings’ and its Subsidiaries’ knowledge, there are, and have been, no
conditions, occurrences, or Hazardous Materials Activities which could
reasonably be expected to form the basis of an Environmental Claim against
Holdings or any of its Subsidiaries that, individually or in the aggregate,
could reasonably be

 

 

expected to have a Material Adverse Effect.  Compliance with all current and to the knowledge of Holdings and
its Subsidiaries, reasonably foreseeable future requirements pursuant to or
under Environmental Laws could not be reasonably expected to have, individually
or in the aggregate, a Material Adverse Effect.  No event or condition is occurring with respect to Holdings or
any of its Subsidiaries relating to any Environmental Law, any Release of
Hazardous Materials, or any Hazardous Materials Activity which individually or
in the aggregate could reasonably be expected to have, a Material Adverse
Effect.  To the knowledge of Holdings
and its Subsidiaries, no liens in favor of any person arising from any
Environmental Claim have been filed or attached to any of the Real Estate
Assets

 

4.14.                     No Defaults.  Neither Holdings nor any of its Subsidiaries
is in default in the performance, observance or fulfillment of any of the
obligations, covenants or conditions contained in any of its Contractual
Obligations, and no condition exists which, with the giving of notice or the
lapse of time or both, would constitute such a default, in each case except
where the consequences, direct or indirect, of such default or defaults, if
any, would reasonably be expected to have a Material Adverse Effect.

 

4.15.                     Certain Contracts.  The
material contracts listed on Schedule 3.1(j) are in effect on the Closing Date,
and except as described thereon, all such material contracts are in full force
and effect and no default exists thereunder as of the Closing Date.

 

4.16.                     Governmental Regulation.  Neither Holdings nor any of its Subsidiaries is subject to
regulation under the Public Utility Holding Company Act of 1935, the Federal
Power Act or the Investment Company Act of 1940 or under any other federal or
state statute or regulation which may limit its ability to incur Indebtedness
or which may otherwise render all or any portion of the Obligations
unenforceable.  Neither Holdings nor any
of its Subsidiaries is a “registered investment company” or a company “controlled”
by a “registered investment company” or a “principal underwriter” of a
“registered investment company” as such terms are defined in the Investment
Company Act of 1940.

 

4.17.                     Margin Stock.  Neither Holdings nor any of its
Subsidiaries is engaged principally, or as one of its important activities, in
the business of extending credit for the purpose of purchasing or carrying any
Margin Stock.  No part of the proceeds
of the Loans made to such Credit Party will be used to purchase or carry any
such margin stock or to extend credit to others for the purpose of purchasing
or carrying any such margin stock or for any purpose that violates, or is
inconsistent with, the provisions of Regulation T, U or X of the Board of
Governors of the Federal Reserve System.

 

4.18.                     Employee Matters.
 Neither the Company nor Holdings
nor any of their Subsidiaries is engaged in any unfair labor practice that
could reasonably be expected to have a Material Adverse Effect.  There is (a) no unfair labor practice
complaint pending against the Company or Holdings or any of their Subsidiaries,
or to the best knowledge of Holdings and the Company, threatened against any of
them before the National Labor Relations Board and no grievance or arbitration
proceeding arising out of or under any collective bargaining agreement that is
so pending against the Company, Holdings or any of their Subsidiaries or to the
best knowledge of Holdings and the Company, threatened against any of them, and
(b) no strike or work stoppage in existence or threatened involving the
Company, Holdings or any of their Subsidiaries that could reasonably be
expected to have a Material Adverse Effect, (with respect to any matter
specified in clause (a) or (b) above, either individually or in the aggregate)
such as is not reasonably likely

 

 

to have a Material Adverse Effect.

 

4.19.                     Employee Benefit Plans.  The Company, Holdings, each of their Subsidiaries and each of
their respective ERISA Affiliates are in compliance with all applicable
provisions and requirements of ERISA and the Internal Revenue Code and the
regulations and published interpretations thereunder with respect to each
Employee Benefit Plan, and have performed all their obligations under each
Employee Benefit Plan, except where such non-compliance or failure to perform
would not reasonably be expected to have a Material Adverse Effect.  Each Employee Benefit Plan which is intended
to qualify under Section 401(a) of the Internal Revenue Code has been
determined by the Internal Revenue Service to be so qualified or the Company,
Holdings, any of their Subsidiaries or their respective ERISA Affiliates, as
applicable, shall timely make all filings necessary to obtain such
qualification.  No material liability to
the PBGC (other than required premium payments which have been timely paid when
due), the Internal Revenue Service, any Employee Benefit Plan or any Trust
established under Title IV of ERISA has been or is expected to be incurred by
the Company, Holdings, any of their Subsidiaries or any of their ERISA
Affiliates.  No ERISA Event has occurred
or is reasonably expected to occur. 
Except for benefits required pursuant to the terms of the Employee
Matters Agreement entered into as of June 9, 2000 by and between Seller and the
Company (formerly known as VAC Acquisition Corp. II) (such benefits referred to
as “Retiree Medical Benefits”) or to the extent required under Section 4980B of
the Internal Revenue Code or similar state laws, no Employee Benefit Plan
provides health or welfare benefits (through the purchase of insurance or
otherwise) for any retired or former employee of the Company, Holdings, any of
their Subsidiaries or any of their respective ERISA Affiliates.  As of July 1, 2000, the estimated
liabilities of the Retiree Medical Benefits is $409,300,000.  As of the most recent valuation date for any
Pension Plan, the amount of unfunded benefit liabilities as defined in Section
4001(a)(18) of ERISA, in the aggregate for all Pension Plans, does not exceed
$0.  As of the most recent valuation
date for each Multiemployer Plan for which the actuarial report is available,
the potential liability of the Company, Holdings, their Subsidiaries and their
respective ERISA Affiliates for a complete withdrawal from such Multiemployer
Plan (within the meaning of Section 4203 of ERISA), when aggregated with such
potential liability for a complete withdrawal from all Multiemployer Plans,
based on information available pursuant to Section 4221(e) of ERISA, does not
exceed $10,000,000.  The Company,
Holdings, each of their Subsidiaries and each of their ERISA Affiliates have
complied in all material respects with the requirements of Section 515 of ERISA
with respect to each Multiemployer Plan and are not in material “default” (as
defined in Section 4219(c)(5) of ERISA) with respect to payments to a
Multiemployer Plan.

 

4.20.                     Solvency.  Each Credit Party is and, upon the
incurrence of any Obligation by such Credit Party on any date on which this
representation and warranty is made, will be, Solvent.

 

4.21.                     Related Agreements.

 

(a)                                  Delivery.  Holdings and Company have delivered to
Administrative Agent complete and correct copies of (i) each Related Agreement
and of all exhibits and schedules

 

 

thereto as of the date
hereof and (ii) copies of any material amendment, restatement, supplement or
other modification to or waiver of each Related Agreement entered into after
the date hereof.

 

(b)                                 Governmental
Approvals.  All material
Governmental Authorizations and all other authorizations, approvals and
consents of any other Person required by the Related Agreements or to consummate
the Acquisition have been obtained and are in full force and effect.

 

(c)                                  Conditions
Precedent.  On the Closing Date, (i)
all of the conditions to effecting or consummating the Acquisition set forth in
the Related Agreements have been duly satisfied in all material respects or,
with the consent of Administrative Agent and Syndication Agent, waived, and
(ii) Acquisition has been consummated in accordance with the Related Agreements
and all applicable laws.

 

4.22.                     Compliance with Statutes, etc.  Each of Holdings and its Subsidiaries is in
compliance with all applicable statutes, regulations and orders of, all
Governmental Authorities, in respect of the conduct of its business and the
ownership of its property (including compliance with all applicable Environmental
Laws with respect to any Real Estate Asset or governing its business and the
requirements of any permits issued under such Environmental Laws with respect
to any such Real Estate Asset or the operations of Holdings or any of its
Subsidiaries), except such non-compliance that, individually or in the
aggregate, could not reasonably be expected to result in a Material Adverse
Effect.

 

4.23.                     Disclosure.  No representation or warranty of any Credit
Party contained in any Credit Document or in any other documents, certificates
or written statements furnished to Lenders by or on behalf of Holdings or any
of its Subsidiaries for use in connection with the transactions contemplated
hereby contains any untrue statement of a material fact or omits to state a
material fact (known to Holdings or Company,) necessary in order to make the
statements contained herein or therein not misleading in light of the
circumstances in which the same were made. 
Any projections and pro forma financial information contained in such
materials are based upon good faith estimates and assumptions believed by
Holdings or Company to be reasonable at the time made, it being recognized by
Lenders that such projections as to future events are not to be viewed as facts
and that actual results during the period or periods covered by any such
projections may differ from the projected results.  As of the Closing Date neither Holdings nor Company has
intentionally withheld, either individually or in the aggregate, any facts from
the Agents in regard to any matters which could reasonably be expected to
result in a Material Adverse Effect.

 

SECTION 5. 
AFFIRMATIVE COVENANTS

 

Each Credit Party
covenants and agrees that so long as any Commitment is in effect and until
payment in full of all Obligations and cancellation or expiration of all
Letters of Credit, each Credit Party shall perform, and shall cause each of its
Subsidiaries to perform, all covenants in this Section 5.

 

 

5.1.                            Financial Statements and Other Reports.  Holdings will deliver to Administrative
Agent and Lenders:

 

(a)                                  Monthly
Reports.  As soon as available, and
in any event within thirty days after the end of each month ending after the
Closing Date, a monthly management report for Company and its Subsidiaries;

 

(b)                                 Quarterly
Financial Statements.  As soon as
available, and in any event within forty five days after the end of each Fiscal
Quarter of each Fiscal Year, the consolidated balance sheets of Holdings and
its Subsidiaries as at the end of such Fiscal Quarter and the related
consolidated statements of income, stockholders’ equity and cash flows of
Holdings and its Subsidiaries for such Fiscal Quarter and for the period from
the beginning of the then current Fiscal Year to the end of such Fiscal
Quarter, setting forth in each case in comparative form the corresponding
figures for the corresponding periods of the previous Fiscal Year, all in
reasonable detail, together with a Financial Officer Certification;

 

(c)                                  Annual
Financial Statements.  As soon as
available, and in any event within one hundred and twenty days after the end of
each Fiscal Year, (i) the consolidated balance sheets of Holdings and its
Subsidiaries as at the end of such Fiscal Year and the related consolidated
statements of income, stockholders’ equity and cash flows of Holdings and its
Subsidiaries for such Fiscal Year, setting forth in each case in comparative
form the corresponding figures for the previous Fiscal Year, in reasonable
detail, together with a Financial Officer Certification and a Narrative Report
with respect thereto; and (ii) with respect to such consolidated financial
statements a report thereon of one of the five largest certified public
accountants in the United States or other independent certified public
accountants of recognized national standing selected by Holdings, and
reasonably satisfactory to Administrative Agent (which report shall have no
disclosure as to going concern and which shall state that such consolidated
financial statements fairly present, in all material respects, the consolidated
financial position of Holdings and its Subsidiaries as at the dates indicated
and the results of their operations and their cash flows for the periods
indicated in conformity with GAAP (except as otherwise disclosed in such
financial statements) and that the examination by such accountants in
connection with such consolidated financial statements has been made in
accordance with generally accepted auditing standards) together with a written
statement by such independent certified public accountants stating (1) that
their audit examination has included a review of the terms of the Credit
Documents, (2)  that in making the
examination nothing came to their attention that caused them to believe that
Holdings and the Borrower were not in compliance with Section 6.8, and (3) that
nothing has come to their attention that causes them to believe that the
information contained in any Compliance Certificate is not correct or that the
matters set forth in such Compliance Certificate are not stated in accordance
with the terms hereof;

 

(d)                                 Compliance
Certificate.  Together with each
delivery of financial statements of

 

 

Holdings and its
Subsidiaries pursuant to Sections 5.1(b) and 5.1(c), a duly executed and
completed Compliance Certificate;

 

(e)                                  Statements
of Reconciliation after Change in Accounting Principles.  If, as a result of any change in accounting
principles and policies under GAAP from those in use as of the Closing Date,
the consolidated financial statements of Holdings and its Subsidiaries delivered
pursuant to Section 5.1(b) or 5.1(c) will differ in any material respect from
the consolidated financial statements that would have been delivered pursuant
to such subdivisions had no such change in accounting principles and policies
been made, then, together with the first delivery of such financial statements
after such change, one or more a statements of reconciliation for all such
prior financial statements during the last calendar year in form and substance
reasonably satisfactory to Administrative Agent;

 

(f)                                    Notice
of Default.  Promptly upon any
senior officer of Holdings or Company obtaining knowledge (i) of any condition
or event that constitutes a Default or an Event of Default; or (ii) of the
occurrence of any event or change that has caused or evidences a Material
Adverse Effect, a certificate of its Authorized Officer specifying the nature
and period of existence of such condition, event or change, or specifying the
notice given and action taken by any such Person and the nature of such claimed
Event of Default, Default, default, event or condition, and what action Company
has taken, is taking and proposes to take with respect thereto;

 

(g)                                 Notice
of Litigation.  Promptly upon any
senior officer of Holdings or Company obtaining knowledge in writing of (i) the
institution of any Adverse Proceeding not previously disclosed in writing by
Company to Lenders, or (ii) any material development in any Adverse Proceeding
that, in the case of either (i) or (ii) could be reasonably expected to have a
Material Adverse Effect, written notice thereof together with such other
information as may be reasonably available to Holdings or Company to enable
Lenders to evaluate such matters;

 

(h)                                 ERISA.
(i) Promptly upon becoming aware of the occurrence of or forthcoming occurrence
of any ERISA Event, a written notice specifying the nature thereof, what action
the Company, Holdings, any of their Subsidiaries or any of their respective
ERISA Affiliates has taken, is taking or proposes to take with respect thereto
and, when known, any action taken or threatened by the Internal Revenue
Service, the Department of Labor or the PBGC with respect thereto; and (ii)
upon the request of the Administrative Agent, with reasonable promptness,
copies of (1) each Schedule B (Actuarial Information) to the annual report
(Form 5500 Series) filed by the Company, Holdings, any of their Subsidiaries or
any of their respective ERISA Affiliates with the Internal Revenue Service with
respect to each Pension Plan; (2) all notices received by the Company,
Holdings, any of their Subsidiaries or any of their respective ERISA Affiliates
from a Multiemployer Plan sponsor concerning an ERISA Event; and (3) copies of
such other documents or governmental reports or filings relating to any
Employee Benefit Plan as Administrative Agent shall reasonably request;

 

 

(i)                                     Financial
Plan.  As soon as practicable and in
any event no later than ninety days after the beginning of each Fiscal Year, a
consolidated plan and financial forecast for the lesser of (I) the next five
years and (II) the remainder of the life of the Loans (a “Financial Plan”), including
(i) a forecasted consolidated balance sheet and forecasted consolidated
statements of income and cash flows of Holdings and its Subsidiaries for each
Fiscal Year during such period, together with pro forma Compliance Certificates
for each such Fiscal Year and an explanation of the assumptions on which such
forecasts are based and (ii) forecasted consolidated statements of income and
cash flows of Holdings and its Subsidiaries for (x) each month of the
immediately succeeding Fiscal Year, (y) each Fiscal Quarter for the next
succeeding Fiscal Year and (z) and thereafter each Fiscal Year.

 

(j)                                     Information
Regarding Collateral. (1) The Company will furnish to the Collateral Agent
prompt written notice of any change (A) in any Credit Party’s corporate name,
(B) in the location of any Credit Party’s chief executive office, its principal
place of business, any office in which it maintains books or records relating to
Collateral owned by it or any office or facility at which Collateral (other
than real property and improvements and fixtures thereto) owned by it with a
book value in excess of $1,000,000 is located (including the establishment of
any such new office or facility), (C) in any Credit Party’s identity or
corporate structure or (D) in any Credit Party’s Federal Taxpayer
Identification Number.  In the event of
a change referred to in the previous sentence, the Company agrees to make
arrangements for all filings reasonably requested by Collateral Agent under the
Uniform Commercial Code or otherwise that are required in order for the
Collateral Agent to continue at all times following such change to have a
valid, legal and perfected security interest in all the Collateral and for the
Collateral at all times following such change to have a valid, legal and
perfected security interest as contemplated in the Collateral Documents.  The Company also agrees promptly to notify
the Collateral Agent if any material portion of the Collateral is damaged or
destroyed.

 

(k)                                  Other
Information.  (A) promptly after the
sending or filing thereof, copies of (i) all reports, notices and proxy
statements, registration statements (other than on Form S-8 or a similar form)
and prospectuses, if any, filed by Holdings or any of its Subsidiaries with any
securities exchange or with the Securities and Exchange Commission or any
governmental or private regulatory authority, and (ii) all press releases and
other statements made available generally by Holdings or any of its
Subsidiaries to the public concerning material developments in the business of
Holdings or any of its Subsidiaries, and (B) such other information and data
with respect to Holdings or any of its Subsidiaries as from time to time may be
reasonably requested by Administrative Agent or by any Lender through the
Administrative Agent.

 

5.2.                            Existence.  Except as otherwise permitted under Section
6.9, each Credit Party will, and will cause each of its Subsidiaries to, at all
times preserve and keep in full force and effect its existence and all rights
and franchises, licenses and permits material to its business; provided,
no Credit Party or any of its Subsidiaries shall be required to preserve any
such existence, right or franchise, licenses and permits if such Credit Parties
determines that the preservation thereof is no longer desirable in the conduct
of the business of such Person or if the failure to preserve any

 

 

such existence, right, franchise, licenses and permits would not
reasonably be expected to have Material Adverse Effect.

 

5.3.                            Payment of Taxes and Claims.  Each Credit Party will, and will cause each of its Subsidiaries
to, pay all Taxes validly imposed upon it or any of its properties or assets or
in respect of any of its income, businesses or franchises before any penalty or
fine accrues thereon, and all claims (including claims for labor, services,
materials and supplies) for sums that have become due and payable and that by
law have or may become a Lien upon any of its properties or assets, prior to
the time when any penalty or fine shall be incurred with respect thereto; provided,
no such Tax or claim need be paid if it is being contested in good faith by
appropriate proceedings promptly instituted and diligently conducted, so long
as adequate reserve or other appropriate provision to the extent required in
conformity with GAAP shall have been made therefor.  No Credit Party will, nor will it permit any of its Subsidiaries to,
file or consent to the filing of any consolidated income Tax return with any
Person (other than Holdings or any of its Subsidiaries).

 

5.4.                            Maintenance of Properties.  Each Credit Party will, and will cause each of its Subsidiaries
to, consistent with historical practices, maintain or cause to be maintained in
good repair, working order and condition, ordinary wear and tear excepted, all
material properties used or useful in the conduct of the business of Holdings
and its Subsidiaries and from time to time will make or cause to be made all necessary
repairs, renewals and replacements thereof unless the applicable Credit Party
determines in good faith that the maintenance of such property is no longer
economically desirable or necessary to the conduct of its business.

 

5.5.                            Insurance.  Holdings will maintain or cause to be
maintained, with financially sound and reputable insurers, such public
liability insurance, third party property damage insurance, business
interruption insurance and casualty insurance with respect to liabilities,
losses or damage in respect of the assets, properties and businesses of
Holdings and its Subsidiaries as may customarily be carried or maintained under
similar circumstances by Persons of established reputation engaged in similar
businesses, in each case in such amounts (giving effect to self-insurance),
with such deductibles, covering such risks and otherwise on such terms and
conditions as shall be customary for such Persons.  Without limiting the generality of the foregoing, Holdings will
maintain or cause to be maintained (a) flood insurance with respect to each
Flood Hazard Property that is located in a community that participates in the
National Flood Insurance Program, in each case in compliance with any
applicable regulations of the Board of Governors of the Federal Reserve System,
and (b) replacement value casualty insurance on the Collateral under such
policies of insurance, with such insurance companies, in such amounts, with
such deductibles, and covering such risks as are at all times carried or
maintained under similar circumstances by Persons of established reputation
engaged in similar businesses.  Each
such policy of insurance shall (i) name Administrative Agent, on behalf of
Lenders as an additional insured thereunder as its interests may appear and
(ii) in the case of each casualty insurance policy, contain a loss payable
clause or endorsement, satisfactory in form and substance to Administrative
Agent, that names Administrative Agent, on behalf of Lenders as the loss payee
thereunder.

 

 

5.6.                            Inspections.  Each Credit Party will, and will cause each
of its Subsidiaries to, permit any authorized representatives designated by any
Lender to visit and inspect any of the properties of any Credit Party and any
of its respective Subsidiaries, to inspect, copy and take extracts from its and
their financial and accounting records, and to discuss its and their affairs,
finances and accounts with its and their officers and independent public
accountants, all upon reasonable notice and at such reasonable times during
normal business hours and as often as may reasonably be requested; provided,
that each Lender shall coordinate with Administrative Agent with respect to the
frequency and timing of such visits and inspections so as to reasonably
minimize the burden imposed on each Credit Party and its Subsidiaries.

 

5.7.                            Lenders Meetings.  Holdings and Company will, upon the request
of Administrative Agent, Syndication Agent or Requisite Lenders, participate in
a meeting of Administrative Agent and Lenders once during each Fiscal Year (or
otherwise periodically as may be agreed to by Agents and Company) to be held at
Company’s corporate offices (or at such other location as may be agreed to by
Company and Administrative Agent) at such time as may be agreed to by Company and
Administrative Agent.

 

5.8.                            Compliance with Laws.  Each
Credit Party will comply, and shall cause each of its Subsidiaries to comply,
with the requirements of all applicable laws, rules, regulations and orders of
any governmental authority (including all Environmental Laws), noncompliance
with which could reasonably be expected to have, individually or in the
aggregate, a Material Adverse Effect.

 

5.9.                            Environmental.

 

(a)                                  Environmental
Disclosure.  Company will deliver to
Administrative Agent and Lenders:

 

(i)                                     as
soon as practicable following receipt thereof, copies of all non-privileged
environmental audits, investigations, analyses and reports, whether prepared by
personnel of Holdings or any of its Subsidiaries or by independent consultants,
governmental authorities or any other Persons, with respect to significant
environmental matters at any Facility or with respect to any Environmental
Claims;

 

(ii)                                  promptly
upon the occurrence thereof, written notice describing in reasonable detail (1)
any Release required to be reported to any federal, state or local governmental
or regulatory agency under any applicable Environmental Laws that could
reasonably be expected to have individually or in the aggregate a Material
Adverse Effect, (2) any remedial action taken by Holdings or any other Person
in response to (A) any Hazardous Materials Activities the existence of which
has a reasonable possibility of resulting in one or more Environmental Claims
having, individually or in the aggregate, a Material Adverse Effect, or (B) any
Environmental Claims that, individually or in the aggregate, have a reasonable

 

 

possibility of resulting
in a Material Adverse Effect, (3) the failure of an indemnitor to comply with
its environmental indemnity obligations in a manner that has the reasonable
possibility of resulting in a Material Adverse Effect and (4) Holdings or
Company’s discovery of any occurrence or condition on any real property
adjoining or in the vicinity of any Facility that could reasonably be expected
to result in a Material Adverse Effect under or as a result of any
Environmental Laws;

 

(iii)                               as soon as practicable
following the sending or receipt thereof by Holdings or any of its
Subsidiaries, a copy of any and all written communications with respect to (1)
any Environmental Claims that, individually or in the aggregate, have a
reasonable possibility of giving rise to a Material Adverse Effect, (2) any
Release required to be reported to any federal, state or local governmental or
regulatory agency that could reasonably be expected to have individually or in
the aggregate a Material Adverse Effect, and (3) any request for information
from any governmental agency that suggests such agency is investigating whether
Holdings or any of its Subsidiaries may be potentially responsible for any
Hazardous Materials Activity that could reasonably be expected to have
individually or in the aggregate a Material Adverse Effect;

 

(iv)                              prompt
written notice describing in reasonable detail (1) any proposed acquisition of
stock, assets, or property by Holdings or any of its Subsidiaries that could
reasonably be expected to (A) expose Holdings or any of its Subsidiaries to, or
result in, Environmental Claims that could reasonably be expected to have,
individually or in the aggregate, a Material Adverse Effect or (B) affect the
ability of Holdings or any of its Subsidiaries to maintain in full force and
effect all material Governmental Authorizations required under any
Environmental Laws for their respective operations and (2) any proposed action
to be taken by Holdings or any of its Subsidiaries to modify current operations
in a manner that could reasonably be expected to subject Holdings or any of its
Subsidiaries to any additional material obligations or material requirements
under any Environmental Laws; and

 

(v)                                 with
reasonable promptness, such other non-privileged documents and information as
from time to time may be reasonably requested by Administrative Agent in
relation to any matters disclosed pursuant to this Section 5.9(a).

 

(b)                                 Hazardous
Materials Activities, Etc.  Each
Credit Party shall promptly take, and shall cause each of its Subsidiaries
promptly to take, any and all actions necessary to (i) cure any violation of
applicable Environmental Laws by such Credit Party or its Subsidiaries that
could reasonably be expected to have, individually or in the aggregate, a
Material Adverse Effect, and (ii) make an appropriate response to any
Environmental Claim against such Credit Party or any of its Subsidiaries and
discharge any obligations it may have to any Person thereunder where failure to
do so could reasonably be expected to have, individually or in the aggregate, a
Material Adverse Effect.

 

5.10.                     Subsidiaries.  In the event that any Person becomes a
Domestic Subsidiary of Company, Company shall (a) promptly cause such Domestic
Subsidiary to become a Guarantor hereunder

 

 

and a Grantor under the Pledge and Security Agreement by executing and
delivering to Administrative Agent and Collateral Agent a Counterpart
Agreement, and (b) take all such actions and execute and deliver, or cause to
be executed and delivered, all such documents, instruments, agreements, and
certificates similar to those described in Sections 3.1(b), 3.1(i) (with
respect to any Material Real Estate Asset) and 3.1(j), and, to the extent
reasonably requested by Collateral Agent, 3.1(k) and 3.1(n).  In the event that any Person becomes a
Foreign Subsidiary of Company, and the ownership interests of such Foreign
Subsidiary are owned by Company or by any Domestic Subsidiary thereof, Company
shall, or shall cause such Domestic Subsidiary to, deliver, all such documents,
instruments, agreements, and certificates as are similar to those described in
Sections 3.1(b), and Company shall take, or shall cause such Domestic
Subsidiary to take, all of the actions referred to in Section 3.1(j)(i)
necessary to grant and to perfect a First Priority Lien in favor of Collateral
Agent, for the benefit of Secured Parties, under the Pledge and Security
Agreement in such ownership interests. 
With respect to each such Subsidiary, Company shall promptly send to
Administrative Agent written notice setting forth with respect to such Person
(i) the date on which such Person became a Subsidiary of Company, and (ii) all
of the data required to be set forth in Schedules 4.1 and 4.2 with respect to
all Subsidiaries of Company; provided, such written notice shall be
deemed to supplement Schedule 4.1 and 4.2 for all purposes hereof.

 

5.11.                     Additional Material Real Estate Assets.  In the event that any Credit Party acquires
a Material Real Estate Asset, and such interest has not otherwise been made
subject to the Lien of the Collateral Documents in favor of Collateral Agent,
for the benefit of Secured Parties, then at the request of Administrative
Agent, such Credit Party, shall take all such actions and execute and deliver,
or cause to be executed and delivered, all such mortgages, documents,
instruments, agreements, opinions and certificates similar to those described
in Sections 3.1(i), 3.1(j) and 5.14 and, to the extent reasonably requested by
Collateral Agent after consultation with the Company, 3.1(k) and, if
applicable, Company and its Subsidiaries shall use its commercially reasonable
and diligent efforts for a period of no longer than ninety days to obtain a
Landlord Personal Property Collateral Access Agreement, with respect to each
such Material Real Estate Asset that Collateral Agent shall reasonably request
to create in favor of Collateral Agent, for the benefit of Secured Parties, a valid
and, subject to any filing and/or recording referred to herein, perfected First
Priority security interest in such Material Real Estate Assets; provided
that with respect to Material Real Estate Assets that are Leasehold Properties,
Company and its Subsidiaries shall be required to use commercially reasonable
and diligent efforts for a period of no longer than ninety days, to obtain a
Landlord Consent and Estoppel with respect thereto and to provide a perfected
First Priority security interest with respect thereto.

 

5.12.                     Interest Rate Protection.  No later than ninety days following the Closing Date Company
shall acquire and maintain in effect during the term thereof one or more
Interest Rate Agreements for a term of not less than three years and otherwise
in form and substance reasonably satisfactory to Administrative Agent and
Syndication Agent, which Interest Rate Agreements shall effectively limit the
Unadjusted Eurodollar Rate Component of the interest costs to Company with
respect to an aggregate notional principal amount of not less than 50% of

 

 

the aggregate principal amount of the Term Loans outstanding from time
to time (based on the assumption that such notional principal amount was a
Eurodollar Rate Loan with an Interest Period of three months) to a rate not
greater than 9.5 % per annum.

 

5.13.                     Further Assurances.  At any
time or from time to time upon the request of Administrative Agent, each Credit
Party will, at its expense, promptly execute, acknowledge and deliver such
further documents and do such other acts and things as Administrative Agent or
Collateral Agent may reasonably request in order to ensure that the Obligations
are guarantied by the Guarantors and are secured by substantially all of the
assets of Holdings, and its Subsidiaries and all of the outstanding Capital
Stock of Company and its Subsidiaries (subject to limitations contained in the
Credit Documents with respect to Foreign Subsidiaries and other assets
specifically excluded as Collateral).

 

5.14.                     Post Closing Real Estate Obligations

 

(a)                                  Company
will, for a period of no longer than ninety days following the Closing Date,
use commercially reasonable and diligent efforts to obtain and deliver to
Collateral Agent a Landlord Consent and Estoppel with respect to each of the
Leasehold Properties listed on Schedule 5.14(a).

 

(b)                                 With
respect to each of the Leasehold Properties listed on Schedule 5.14(a) for
which Company has obtained a Landlord Consent and Waiver, Company shall, within
thirty (30) days after receipt of any such Landlord Consent and Estoppel,
deliver to Collateral Agent:

 

(i)                                     fully
executed and notarized Mortgages, in proper form for recording in all
appropriate places in all applicable jurisdictions, encumbering each such
Leasehold Property (each, a “Post Closing Date Mortgaged Property’’);

 

(ii)                                  an
opinion of counsel (which counsel shall be reasonably satisfactory to
Collateral Agent) in each state in which a Post Closing Date Mortgaged Property
is located with respect to the enforceability of the form(s) of Mortgages to be
recorded in such state and such other matters as Collateral Agent may
reasonably request, in each case in form and substance reasonably satisfactory
to Collateral Agent;

 

(iii)                               (1) a Landlord Consent
and Estoppel and  (2) evidence that such
Leasehold Property is a Recorded Leasehold Interest;

 

(iv)                              (a)
a Title Policy with respect to each Post Closing Date Mortgaged Property, in
amounts reasonably satisfactory to Collateral Agent, together with a title
report issued by a title company with respect thereto, dated not more than
thirty days prior to the closing date of any such Mortgage, and copies of all
recorded documents listed as exceptions to title or otherwise referred to
therein, each in form and substance reasonably satisfactory to Collateral Agent
and (B) evidence satisfactory to Collateral Agent that such Credit Party has
paid to the title

 

 

company or to the
appropriate governmental authorities all expenses and premiums of the title
company and all other sums required in connection with the issuance of each
Title Policy and all recording and stamp taxes (including mortgage recording
and intangible taxes) payable in connection with recording the Mortgages for
each Post Closing Date Mortgaged Property in the appropriate real estate records;
and

 

(v)                                 evidence
of flood insurance with respect to each Flood Hazard Property that is located
in a community that participates in the National Flood Insurance Program, in
each case in compliance with and to the extent required by law or any
applicable regulations of the Board of Governors of the Federal Reserve System,
in form and substance reasonably satisfactory to Collateral Agent.

 

(c)                                  Company
will, within sixty days following the Closing Date, deliver to Collateral Agent
ALTA surveys of all Closing Date Mortgaged Properties, certified to Collateral
Agent and dated not earlier than the Closing Date.

 

5.15.                     Post Closing Personal Property
Collateral Obligations.  To the extent not consummated prior to the
Closing Date, the Company shall, promptly after the Closing Date, (i)
consummate the transfer of all intellectual property rights pursuant to the
Acquisition Agreement and the Intellectual Property Agreement and (ii) take all
necessary actions required by Section 3.1(j) in order to create, in favor of
the Collateral Agent, a First Priority perfected security interest in such
intellectual property Collateral to the extent required by the Pledge and
Security Agreement.

 

SECTION 6.  NEGATIVE
COVENANTS

 

Each Credit Party
covenants and agrees that, so long as any Commitment is in effect and until
payment in full of all Obligations and cancellation or expiration of all
Letters of Credit, such Credit Party shall perform, and shall cause each of its
Subsidiaries to perform, all covenants in this Section 6.

 

6.1.                            Indebtedness.  No Credit Party shall, nor shall it permit
any of its Subsidiaries to, directly or indirectly, create, incur, assume or
guaranty, or otherwise become or remain directly or indirectly liable with
respect to any Indebtedness, except:

 

(a)                                  the
Obligations;

 

(b)                                 Indebtedness
of any Guarantor Subsidiary to Company or to any other Guarantor Subsidiary, or
of Company to any Guarantor Subsidiary; provided, (i) all such
Indebtedness shall be evidenced by promissory notes and all such notes shall be
subject to a First Priority Lien pursuant to the Pledge and Security Agreement,
(ii) all such Indebtedness shall be unsecured and subordinated in right of
payment to the payment in full of the Obligations pursuant to the terms

 

 

of the applicable promissory
notes or an intercompany subordination agreement that in any such case, is
reasonably satisfactory to Administrative Agent, and (iii) any payment by any
such Guarantor Subsidiary under any guaranty of the Obligations shall result in
a pro tanto reduction of the amount of any Indebtedness owed by such Subsidiary
to Company or to any of its Subsidiaries for whose benefit such payment is
made;

 

(c)                                  Holdings
may incur Indebtedness with respect to the Holdings Notes;

 

(d)                                 Indebtedness
incurred by Holdings, Company or any of its Subsidiaries arising from
agreements providing for indemnification, adjustment of purchase price or
similar obligations, or from guaranties or letters of credit, surety bonds or
performance bonds securing the performance of the Company or any such
Subsidiary pursuant to such agreements, in connection with the Acquisition,
Permitted Acquisitions or permitted dispositions of any business, assets or
Subsidiary of Holdings or any of its Subsidiaries;

 

(e)                                  Holdings
or Company may become and remain liable with respect to Permitted Seller Notes
issued as consideration in Permitted Acquisitions; provided that (i) the
aggregate principal amount of Permitted Seller Notes outstanding at anytime
shall not exceed $20,000,000 and (ii) the aggregate principal amount of
Permitted Seller Notes outstanding at any time with respect to which Company is
the obligor shall not exceed $10,000,000;

 

(f)                                    A
Subsidiary acquired pursuant to a Permitted Acquisition may become or remain
liable with respect to Indebtedness of such Subsidiary of Company existing at
the time of acquisition by Company or its Subsidiary of such Subsidiary or
assets obtained pursuant to a Permitted Acquisition; provided that (i)
such Indebtedness was not incurred in connection with or in anticipation of
such Permitted Acquisition, and (ii) the aggregate principal amount of all such
indebtedness does not exceed $10,000,000;

 

(g)                                 Indebtedness
incurred by Holdings, Company or its Subsidiaries which may be deemed to exist
pursuant to any guaranties, performance, surety, statutory, appeal or similar
obligations incurred in the ordinary course of business;

 

(h)                                 Indebtedness
incurred by Holdings, Company or its Subsidiaries in respect of netting
services, overdraft protections and otherwise in connection with deposit
accounts;

 

(i)                                     guaranties
in the ordinary course of business of the obligations of suppliers, customers,
franchisees and licensees of Holdings, Company and its Subsidiaries;

 

(j)                                     Indebtedness
described in Schedule 6.1, but not any extensions, renewals or replacements of
such Indebtedness except (i) renewals and extensions expressly provided for in
the agreements evidencing any such Indebtedness as the same are in effect on
the date of this Agreement and (ii) refinancings and extensions of any such
Indebtedness if the terms and conditions thereof are not less favorable to the
obligor thereon or to the Lenders than the

 

 

Indebtedness being
refinanced or extended, and the average life to maturity thereof is greater
than or equal to that of the Indebtedness being refinanced or extended; provided,
such Indebtedness permitted under the immediately preceding clause (i) or (ii)
above shall not (A) include Indebtedness of an obligor that was not an obligor
with respect to the Indebtedness being extended, renewed or refinanced, (B)
exceed in a principal amount the Indebtedness being renewed, extended or
refinanced or (C) be incurred, created or assumed if any Event of Default has
occurred and is continuing or would result therefrom;

 

(k)                                  Indebtedness
with respect to Capital Leases in an aggregate amount not to exceed at any time
$10,000,000;

 

(l)                                     Indebtedness
incurred by Company with respect to Hedge Agreements;

 

(m)                               purchase
money Indebtedness incurred by Company or its Subsidiaries in an aggregate amount
not to exceed at any time $15,000,000 (less the amount of indebtedness
outstanding under Subsection 6.1(k) above); provided, any such
Indebtedness shall be secured only to the asset acquired in connection with the
incurrence of such Indebtedness or proceeds thereof; and

 

(n)                                 other
unsecured Indebtedness of Company and its Subsidiaries, in an aggregate amount
not to exceed at any time $15,000,000.

 

6.2.                            Liens.  No Credit Party shall, nor shall it permit
any of its Subsidiaries to, directly or indirectly, create, incur, assume or
permit to exist any Lien on or with respect to any property or asset of any
kind (including any document or instrument in respect of goods or accounts
receivable) of Holdings or any of its Subsidiaries, whether now owned or hereafter
acquired, or any income or profits therefrom, or file or permit the filing of,
or permit to remain in effect, any financing statement or other similar notice
of any Lien with respect to any such property, asset, income or profits under
the UCC of any State or under any similar recording or notice statute, except:

 

(a)                                  Liens
in favor of Collateral Agent for the benefit of Secured Parties granted
pursuant to any Credit Document;

 

(b)                                 Liens
for Taxes if obligations with respect to such Taxes are being contested in good
faith by appropriate proceedings promptly instituted and diligently conducted;

 

(c)                                  statutory
Liens of landlords, banks (and rights of set-off), of carriers, warehousemen,
mechanics, repairmen, workmen and materialmen, and other Liens imposed by law
(other than any such Lien imposed pursuant to Section 401 (a)(29) or 412(n) of
the Internal Revenue Code or by ERISA), in each case incurred in the ordinary
course of business (i) for amounts not yet overdue or (ii) for amounts that are
overdue and that (in the case of any such amounts overdue for a period in
excess of five days) are being contested in good faith by

 

 

appropriate proceedings,
so long as such reserves or other appropriate provisions, if any, as shall be
required by GAAP shall have been made for any such contested amounts;

 

(d)                                 Liens
incurred in the ordinary course of business in connection with workers’
compensation, unemployment insurance and other types of social security, or to
secure the performance of tenders, statutory obligations, surety and appeal
bonds, bids, leases, government contracts, trade contracts, performance and
return-of-money bonds and other similar obligations (exclusive of obligations
for the payment of borrowed money or other Indebtedness), so long as no foreclosure,
sale or similar proceedings have been commenced with respect to any portion of
the Collateral on account thereof;

 

(e)                                  easements,
rights-of-way, restrictions, encroachments, and other minor defects or
irregularities in title, in each case which do not and will not interfere in
any material respect with the ordinary conduct of the business of Holdings or
any of its Subsidiaries;

 

(f)                                    any
interest or title of a lessor or sublessor under any lease of real estate
permitted hereunder;

 

(g)                                 Liens
solely on any cash earnest money deposits made by Company or any of its
Subsidiaries in connection with any letter of intent or purchase agreement
permitted hereunder;

 

(h)                                 Purported
Liens evidenced by the filing of precautionary UCC financing statements relating
solely to operating leases for personal property entered into in the ordinary
course of business;

 

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

 

(j)                                     any
zoning or similar law or right reserved to or vested in any governmental office
or agency to control or regulate the use of any real property;

 

(k)                                  licenses
of patents, trademarks and other intellectual property rights granted by
Holdings or any of its Subsidiaries in the ordinary course of business and not
interfering in any respect with the ordinary conduct of the business of Company
or such Subsidiary;

 

(l)                                     Liens
described in Schedule 6.2 or on a title report delivered pursuant to Section
3.1(i);

 

(m)                               Liens
securing Indebtedness permitted pursuant to 6.1(m); provided, any such
Lien shall encumber only the asset acquired with the proceeds of such
Indebtedness and proceeds thereof;

 

(n)                                 liens
on assets acquired pursuant to a Permitted Acquisition securing Indebtedness
permitted under Section 6.1(f) so long as such Liens were not created in
anticipation of such Permitted Acquisition; and

 

 

(o)                                 any
land use restrictions consistent with the terms of Section 9.8(g) of the
Acquisition Agreement

 

6.3.                            Equitable Lien.
 If any Credit Party or any of
its Subsidiaries shall create or assume any security interest or lien to secure
Indebtedness for Borrowed Money upon any of its properties or assets, whether
now owned or hereafter acquired, other than Permitted Liens, it shall make or
cause to be made effective provisions whereby the Obligations will be secured
by such Lien equally and ratably with any and all other Indebtedness secured
thereby as long as any such Indebtedness shall be so secured; provided,
notwithstanding the foregoing, this covenant shall not be construed as a
consent by Requisite Lenders to the creation or assumption of any such Lien not
otherwise permitted hereby.

 

6.4.                            No Further Negative Pledges. 
Except with respect to (a) specific property encumbered to
secure payment of particular Indebtedness or to be sold pursuant to an executed
agreement with respect to a permitted Asset Sale and (b) restrictions by reason
of customary provisions contained in leases, licenses, government contracts and
similar agreements entered into in the ordinary course of business (provided
that such restrictions are limited to the property or assets secured by such
Liens or the property or assets subject to such leases, licenses or similar
agreements, as the case may be) no Credit Party nor any of its Subsidiaries
shall enter into any agreement prohibiting the creation or assumption of any
Lien upon any of its properties or assets, whether now owned or hereafter
acquired.

 

6.5.                            Restricted Junior Payments.  No Credit Party shall, nor shall it permit
any of its Subsidiaries to, directly or indirectly, declare, order, pay, make
or set apart any sum for any Restricted Junior Payment except that (a) (i)
Holdings may make regularly scheduled payments of interest in respect of the
Holdings Notes in accordance with the terms of, and only to the extent required
by, the agreement or instruments pursuant to which the Holdings Notes was
issued and (ii) Company may make Restricted Junior Payments to Holdings to the
extent necessary to permit Holdings to discharge the consolidated tax
liabilities of Holdings and its Subsidiaries, so long as Holdings applies the
amount of any such Restricted Junior Payment for such purpose, (b) so long as
no Event of Default under Section 8.1(a) shall have occurred and be continuing
or shall be caused thereby, Company may make Restricted Junior Payments to
Holdings (i) sufficient to make scheduled payments of interest on the Holdings
Notes then due and owing; provided that, no such Restricted Junior
Payment may be made unless after giving effect to such payment, (A) the
Leverage Ratio does not exceed 2.0:1.0 and (B) the ratio of (I) Consolidated
Total Debt plus the aggregate principal amount of outstanding Holdings Notes to
(II) Consolidated Adjusted EBITDA for the four Fiscal Quarter period most
recently ended shall not exceed 3.00:1.00, (c) Company may make Restricted
Junior Payments to Holdings to make payments under the Management Agreement and
Holdings or Company may make payments in accordance with the terms of the
Management Agreement; (d) Holdings or Company may make Restricted Junior
Payments in an aggregate amount not to exceed $3,500,000 in any Fiscal Year

 

 

to the extent necessary to make repurchases of Securities (and options
or warrants to purchase such Securities) of Holdings from employees (i) upon
termination (including by reason of death, disability or retirement) of such
employees or (ii) pursuant to a contractual obligation of Holdings or Company,
(e) Company may make Restricted Junior Payments to Holdings to the extent
necessary to permit Holdings to pay reasonable accounting, legal, SEC related,
and similar fees, expenses and costs, expenses and indemnities payments to
directors or members of board of managers of Holdings, and (f)  Company and Holdings may make Restricted
Junior Payments to the extent necessary to accomplish the payment of the
Transaction Costs.

 

6.6.                            Restrictions on Subsidiary
Distributions.  Except as provided herein, no Credit Party
shall, nor shall it permit any of its Subsidiaries to, create or otherwise
cause any consensual encumbrance or restriction of any kind on the ability of
any Subsidiary of Company to (a) pay dividends or make any other distributions
on any of such Subsidiary’s Capital Stock owned by Company or any other
Subsidiary of Company, (b) repay or prepay any Indebtedness owed by such
Subsidiary to Company or any other Subsidiary of Company, (c) make loans or
advances to Company or any other Subsidiary of Company, or (d) transfer any of
its property or assets to Company or any other Subsidiary of Company other than
restrictions (i) in agreements evidencing Indebtedness permitted by Sections
6.1(f) and 6.1(l) that impose restrictions on the property so acquired and
proceeds thereof and (ii) by reason of customary provisions contained in
leases, licenses, joint venture agreements and similar agreements entered into
in the ordinary course of business, and (iii) that are or were created by
virtue of any transfer of, agreement to transfer or option or right with
respect to any property, assets or Capital Stock not otherwise prohibited under
this Agreement.

 

6.7.                            Investments.  No Credit Party shall, nor shall it
permit any of its Subsidiaries to, directly or indirectly, make or own any
Investment in any Person, including without limitation any Joint Venture,
except:

 

(a)                                  Cash
and Cash Equivalents;

 

(b)                                 equity
Investments owned as of the Closing Date in any Subsidiary and Investments made
after the Closing Date in Company or wholly-owned Domestic Subsidiaries of
Company;

 

(c)                                  Investments
(i) in accounts receivable arising and trade credit granted in the ordinary
course of business and in any Securities received in satisfaction or partial
satisfaction thereof from financially troubled account debtors and (ii)
deposits, prepayments and other credits to suppliers made in the ordinary
course of business consistent with the past practices of Holdings and its
Subsidiaries;

 

(d)                                 intercompany
loans to the extent permitted under Section 6.1(b);

 

(e)                                  Consolidated
Capital Expenditures permitted by Section 6.8(d);

 

 

(f)                                    loans
and advances to employees of Holdings and its Subsidiaries made in the ordinary
course of business in an aggregate principal amount not to exceed $5,000,000 in
the aggregate;

 

(g)                                 Investments
made in connection with Permitted Acquisitions permitted pursuant to Section
6.9;

 

(h)                                 Investments
described in Schedule 6.7; and

 

(i)                                     other
Investments in an aggregate amount not to exceed at any time $10,000,000.

 

(j)                                     loans
to officers of Holdings and its Subsidiaries to be used to purchase stock, or
options on the stock, of Holdings provided that the proceeds of such loans are
reinvested in the Company;

 

(k)                                  Investments
received in connection with Permitted Asset Sales in an aggregate amount not to
exceed at any time 25% of the aggregate consideration for such Permitted Asset
Sales; and

 

(l)                                     Investments
in joint ventures, foreign Subsidiaries in an aggregate amount not to exceed
$15,000,000 plus the amount of cash dividends or other returns received
by Credit Parties from such Investments.

 

6.8.                            Financial Covenants.

 

(a)                                  Interest
Coverage Ratio.  Holdings shall not
permit the Interest Coverage Ratio as of the last day of any Fiscal Quarter,
beginning with the Fiscal Quarter ending September 30, 2000, to be less than
the correlative ratio indicated:

 

	
  Fiscal
  Quarter

  	
   

  	
  Interest

  Coverage Ratio

  	
   

  
	
  September 30, 2000

  	
   

  	
  2.00:1.00

  	
   

  
	
  December 31, 2000

  	
   

  	
  2.00:1.00

  	
   

  
	
  March 31, 2001

  	
   

  	
  2.00:1.00

  	
   

  
	
  June 30, 2001

  	
   

  	
  2.00:1.00

  	
   

  
	
  September 30, 2001

  	
   

  	
  2.50:1.00

  	
   

  
	
  December 31, 2001

  	
   

  	
  2.50:1.00

  	
   

  
	
  March 31, 2002

  	
   

  	
  2.50:1.00

  	
   

  
	
  June 30, 2002

  	
   

  	
  2.50:1.00

  	
   

  
	
  September 30, 2002

  	
   

  	
  3.00:1.00

  	
   

  
	
  December 31, 2002

  	
   

  	
  3.00:1.00

  	
   

  
	
  March 31, 2003

  	
   

  	
  3.50:1.00

  	
   

  
	
  June 30, 2003

  	
   

  	
  3.50:1.00

  	
   

  
	
  September 30, 2003

  	
   

  	
  3.50:1.00

  	
   

  
	
  December 31, 2003

  	
   

  	
  3.50:1.00

  	
   

  
	
  March 31, 2004 and thereafter

  	
   

  	
  3.00:1.00

  	
   

  

 

 

(b)                                 Fixed
Charge Coverage Ratio.  Holdings
shall not permit the Fixed Charge Coverage Ratio as of the last day of any
Fiscal Quarter, beginning with the Fiscal Quarter ending September 30, 2000, to
be less than the correlative ratio indicated:

 

	
  Fiscal Quarter

  	
   

  	
  Fixed
  Charge

  Coverage Ratio

  	
   

  
	
  September 30, 2000

  	
   

  	
  1.00:1.00

  	
   

  
	
  December 31, 2000

  	
   

  	
  1.00:1.00

  	
   

  
	
  March 31, 2001

  	
   

  	
  1.00:1.00

  	
   

  
	
  June 30, 2001

  	
   

  	
  1.00:1.00

  	
   

  
	
  September 30, 2001

  	
   

  	
  1.00:1.00

  	
   

  
	
  December 31, 2001

  	
   

  	
  1.00:1.00

  	
   

  
	
  March 31, 2002

  	
   

  	
  1.00:1.00

  	
   

  
	
  June 30, 2002

  	
   

  	
  1.00:1.00

  	
   

  
	
  September 30, 2002

  	
   

  	
  1.00:1.00

  	
   

  
	
  December 31, 2002

  	
   

  	
  1.00:1.00

  	
   

  
	
  March 31, 2003

  	
   

  	
  1.10:1.00

  	
   

  
	
  June 30, 2003

  	
   

  	
  1.10:1.00

  	
   

  
	
  September 30, 2003

  	
   

  	
  1.10:1.00

  	
   

  
	
  December 31, 2003

  	
   

  	
  1.10:1.00

  	
   

  
	
  March 31, 2004

  	
   

  	
  1.10:1.00

  	
   

  
	
  June 30, 2004

  	
   

  	
  1.10:1.00

  	
   

  
	
  September 30, 2004

  	
   

  	
  1.10:1.00

  	
   

  
	
  December 31, 2004

  	
   

  	
  1.10:1.00

  	
   

  
	
  March 31, 2005

  	
   

  	
  0.80:1.00

  	
   

  
	
  June 30, 2005

  	
   

  	
  0.80:1.00

  	
   

  
	
  September 30, 2005

  	
   

  	
  0.80:1.00

  	
   

  
	
  December 31, 2005

  	
   

  	
  0.80:1.00

  	
   

  
	
  March 31, 2006

  	
   

  	
  0.80:1.00

  	
   

  
	
  June 30, 2006

  	
   

  	
  0.80:1.00

  	
   

  
	
  September 30, 2006

  	
   

  	
  0.80:1.00

  	
   

  
	
  December 31, 2006

  	
   

  	
  0.80:1.00

  	
   

  
	
  March 31, 2007

  	
   

  	
  0.70:1.00

  	
   

  
	
  June 30, 2007

  	
   

  	
  0.70:1.00

  	
   

  
	
  September 30, 2007 and
  thereafter

  	
   

  	
  0.70:1.00

  	
   

  

 

 

(c)                                  Leverage
Ratio.  Holdings shall not permit
the Leverage Ratio as of the last day of any Fiscal Quarter, beginning with the
Fiscal Quarter ending September 30, 2000, to exceed the correlative ratio
indicated:

 

	
  Fiscal 

  Quarter

  	
   

  	
  Leverage

  Ratio

  	
   

  
	
  September 30, 2000

  	
   

  	
  4.50:1.00

  	
   

  
	
  December 31, 2000

  	
   

  	
  4.50:1.00

  	
   

  
	
  March 31, 2001

  	
   

  	
  4.50:1.00

  	
   

  
	
  June 30, 2001

  	
   

  	
  4.50:1.00

  	
   

  
	
  September 30, 2001

  	
   

  	
  4.00:1.00

  	
   

  
	
  December 31, 2001

  	
   

  	
  4.00:1.00

  	
   

  
	
  March 31, 2002

  	
   

  	
  3.50:1.00

  	
   

  
	
  June 30, 2002

  	
   

  	
  3.50:1.00

  	
   

  
	
  September 30, 2002

  	
   

  	
  3.00:1.00

  	
   

  
	
  December 31, 2002

  	
   

  	
  3.00:1.00

  	
   

  
	
  March 31, 2003 and
  thereafter

  	
   

  	
  2.50:1.00

  	
   

  

 

(d)                                 Maximum
Consolidated Capital Expenditures. 
Holdings shall not, and shall not permit its Subsidiaries to, make or
incur Consolidated Capital Expenditures, in any Fiscal Year indicated below, in
an aggregate amount for Holdings and its Subsidiaries in excess of the
corresponding amount set forth below opposite such Fiscal Year (each such
amount, the “Maximum Scheduled Amount”):

 

	
  Fiscal Year

  	
   

  	
  Consolidated

  Capital

  Expenditures

  	
   

  
	
  July 1, 2000 to

  December 31, 2000

  	
   

  	
  $

  	
  30,000,000

  	
   

  
	
  2001

  	
   

  	
  $

  	
  54,000,000

  	
   

  
	
  2002

  	
   

  	
  $

  	
  42,000,000

  	
   

  
	
  2003

  	
   

  	
  $

  	
  46,000,000

  	
   

  
	
  2004

  	
   

  	
  $

  	
  45,000,000

  	
   

  
	
  2005

  	
   

  	
  $

  	
  45,000,000

  	
   

  
	
  2006

  	
   

  	
  $

  	
  38,000,000

  	
   

  
	
  2007

  	
   

  	
  $

  	
  38,000,000

  	
   

  

 

 

; provided  that any portion of the Maximum Scheduled
Amount for a Fiscal Year not expended during such Fiscal Year (a “Rollover
Amount”) may be expended in one or more subsequent years; provided
further, that the aggregate of all Rollover Amounts expended in
any Fiscal Year may not exceed 50% of the Maximum Scheduled Amount for such
Fiscal Year.

 

(e)                                  Certain
Calculations.  With respect to any
period during which a Permitted Acquisition or an Asset Sale has occurred
(each, a “Subject
Transaction”), for purposes of determining compliance with the
financial covenants set forth in this Section 6.8, Consolidated Adjusted EBITDA
and the components of Consolidated Fixed Charges shall be calculated with
respect to such period on a pro forma basis (including pro forma adjustments
arising out of events which are directly attributable to a specific
transaction, are factually supportable and are expected to have a continuing
impact, in each case determined on a basis consistent with Article 11 of
Regulation S-X promulgated under the Securities Act and as interpreted by the
staff of the Securities and Exchange Commission, which would include cost
savings resulting from head count reduction, closure of facilities and similar
restructuring charges, which pro forma adjustments shall be certified by the
chief financial officer of Holdings) using the historical audited financial
statements of any business so acquired or to be acquired or sold or to be sold
and the consolidated financial statements of Holdings and its Subsidiaries
which shall be reformulated as if such Subject Transaction, and any
Indebtedness incurred or repaid in connection therewith, had been consummated
or incurred or repaid at the beginning of such period (and assuming that such
Indebtedness bears interest during any portion of the applicable measurement
period prior to the relevant acquisition at the weighted average of the
interest rates applicable to outstanding Loans incurred during such period).

 

6.9.                            Fundamental Changes; Disposition of
Assets; Acquisitions.  No Credit Party shall, nor shall it permit
any of its Subsidiaries to, enter into any transaction of merger or
consolidation, or liquidate, wind-up or dissolve itself (or suffer any
liquidation or dissolution), or convey, sell, lease or sub-lease (as lessor or
sublessor), transfer or otherwise dispose of, in one transaction or a series of
transactions, all or any part of its business, assets or property of any kind
whatsoever, whether real, personal or mixed and whether tangible or intangible,
whether now owned or hereafter acquired, or acquire by purchase or otherwise
(other than purchases or other acquisitions of inventory, materials and
equipment in the ordinary course of business) the business, property or fixed
assets of, or stock or other evidence of beneficial ownership of, any Person or
any division or line of business or other business unit of any Person, except:

 

(a)                                  any
Subsidiary of Holdings may be merged with or into Company or any Guarantor
Subsidiary, or be liquidated, wound up or dissolved, or all or any part 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
Company or any Guarantor Subsidiary; provided, in the case of such a
merger, Company or such Guarantor Subsidiary, as applicable shall be the
continuing or surviving Person;

 

(b)                                 sales
or other dispositions of assets that do not constitute Asset Sales;

 

 

(c)                                  Asset
Sales, the proceeds of which (valued at the 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) (i) are
less than $10,000,000 with respect to any single Asset Sale or series of
related Asset Sales, (ii) when aggregated with the proceeds of all other Asset
Sales made within the same Fiscal Year, are less than $25,000,000 and (iii)
$40,000,000 in the aggregate during the term of this Agreement; provided
(1) the consideration received for such assets shall be in an amount at least
equal to the fair market value thereof (determined in good faith by the board
of directors of Company (or similar governing body) if in excess of
$8,000,000), (2) no less than 75% of the consideration therefor shall be paid
in Cash, and (3) the Net Asset Sale Proceeds thereof shall be applied as
required by Section 2.14(a);

 

(d)                                 Permitted
Acquisitions, the consideration for which constitutes (i) less than $25,000,000
in the aggregate in any Fiscal Year, and (ii) less than $50,000,000 in the
aggregate during the term of this Agreement; provided that, if and so long as
the Leverage Ratio is less than 3.5:1.0 calculated on a pro forma basis in
accordance with Section 6.8 giving effect to such Permitted Acquisition(s), the
limits set forth in (i) and (ii) above shall be increased to $50,000,000 and
$100,000,000 respectively; and

 

(e)                                  Investments
made in accordance with Section 6.7.

 

6.10.                     Disposal of Subsidiary Interests.  Except for any sale of all of its interests
in the Capital Stock of any of its Subsidiaries in compliance with the provisions
of Section 6.9, no Credit Party shall, nor shall it permit any of its
Subsidiaries to, (a) directly or indirectly sell, assign, pledge or otherwise
encumber or dispose of any Capital Stock of any of its Subsidiaries, except to
qualify directors if required by applicable law; or (b) permit any of its
Subsidiaries directly or indirectly to sell, assign, pledge or otherwise
encumber or dispose of any Capital Stock of any of its Subsidiaries, except to
another Credit Party (subject to the restrictions on such disposition otherwise
imposed hereunder), or to qualify directors if required by applicable law.

 

6.11.                     Sales
and Lease-Backs.  No Credit
Party shall, nor shall it permit any of its Subsidiaries to, directly or
indirectly, become or remain liable as lessee or as a guarantor or other surety
with respect to any lease of any property (whether real, personal or mixed),
whether now owned or hereafter acquired, which such Credit Party (a) has sold
or transferred or is to sell or to transfer to any other Person (other than
Holdings or any of its Subsidiaries), or (b) intends to use for substantially
the same purpose as any other property which has been or is to be sold or
transferred by such Credit Party to any Person (other than Holdings or any of
its Subsidiaries) in connection with such lease.

 

6.12.                     Transactions with Shareholders and
Affiliates.  No Credit Party shall, nor shall it permit
any of its Subsidiaries to, directly or indirectly, enter into or permit to
exist any transaction (including the purchase, sale, lease or exchange of any
property or the rendering of any service) with any holder of 15% or more of any
class of Capital Stock of Holdings or any of its Subsidiaries or with any
Affiliate of Holdings or of any such holder, on terms that are less

 

 

favorable to Holdings or that Subsidiary, as the case may be, than
those that might be obtained at the time from a Person who is not such a holder
or Affiliate; provided, the foregoing restriction shall not apply to (a)
any transaction between Company and any Guarantor Subsidiary; (b) reasonable
and customary fees paid to members of the board of directors (or similar
governing body) of Holdings and its Subsidiaries; (c) compensation arrangements
for officers and other employees of Holdings and its Subsidiaries entered into
in the ordinary course of business; (d) management and other fees and expense
reimbursements payable to Sponsor and its Affiliates pursuant to the Management
Agreement and (e) transactions described in Schedule 6.12.

 

6.13.                     Conduct of Business.  From and
after the Closing Date, no Credit Party shall, nor shall it permit any of its
Subsidiaries to, engage in any business other than (i) the businesses engaged
in by such Credit Party on the Closing Date and similar or related businesses
and reasonable extensions thereof and (ii) such other lines of business as may
be consented to by Requisite Lenders.

 

6.14.                     Permitted Activities of Holdings.  Notwithstanding anything to the contrary
contained herein, Holdings shall not (a) except as expressly permitted under
Section 6.1, incur, directly or indirectly, any Indebtedness other than the
Indebtedness and obligations under the Related Agreements; (b) create or suffer
to exist any Lien upon any property or assets now owned or hereafter acquired by
it other than the Liens created under the Collateral Documents to which it is a
party or permitted pursuant to Section 6.2; (c) engage in any business or
activity or own any assets other than (i) holding 100% of the Capital Stock of
Company and activities reasonably related thereto, (ii) performing its
obligations and activities incidental thereto under the Credit Documents, and
to the extent not inconsistent therewith, the Related Agreements; and (iii)
making Restricted Junior Payments, Investments and Permitted Acquisitions to
the extent permitted by this Agreement; (d) consolidate with or merge with or
into, or convey, transfer or lease all or substantially all its assets to, any
Person; (e) sell or otherwise dispose of any Capital Stock of any of its Subsidiaries;
(f) create or acquire any Subsidiary or make or own any Investment in any
Person other than Company; or (g) fail to hold itself out to the public as a
legal entity separate and distinct from all other Persons.

 

6.15.                     Amendments of Acquisition Agreement.  No Credit Party shall nor shall it permit
any of its Subsidiaries to, agree to any material amendment, restatement,
supplement or other modification to any of its material rights under the
Acquisition Agreement after the Closing Date without in each case obtaining the
prior written consent of Requisite Lenders to such amendment, restatement,
supplement or other modification.

 

6.16.                     Amendments or Waivers with respect to
Subordinated Indebtedness.  No Credit Party shall, nor shall it permit
any of its Subsidiaries to, amend or otherwise change the terms of any
Permitted Seller Note or the Holdings Notes, or make any payment consistent
with an amendment thereof or change thereto without such amendment or change
being approved in accordance with the provisions of this Agreement, if the
effect of such amendment or change is

 

 

to increase the interest rate on such Permitted Seller Note or the
Holdings Notes, change (to earlier dates) any dates upon which payments of
principal or interest are due thereon, change any event of default or condition
to an event of default with respect thereto (other than to eliminate any such
event of default or increase any grace period related thereto), change the
redemption, prepayment or defeasance provisions thereof, change the
subordination provisions thereof), or if the effect of such amendment or
change, together with all other amendments or changes made, is to increase
materially the obligations of the obligor thereunder or to confer any
additional rights on the holders of such Permitted Seller Note or the Holdings
Notes (or a trustee or other representative on their behalf) which would be
adverse to any Lender, in each case without the prior written concurrence of
the Administrative Agent.

 

6.17.                     Fiscal Year.  No Credit Party shall, nor shall
it permit any of its Subsidiaries to Fiscal Year-end from December 31.

 

SECTION 7.  GUARANTY

 

7.1.                            Guaranty of the Obligations.  Subject to the provisions of Section 7.2,
Guarantors jointly and severally hereby irrevocably and unconditionally
guaranty to Administrative Agent for the ratable benefit of the Beneficiaries
the due and punctual payment in full of all Obligations when the same shall
become due, whether at stated maturity, by required prepayment, declaration,
acceleration, demand or otherwise (including amounts that would become due but
for the operation of the automatic stay under Section 362(a) of the Bankruptcy
Code, 11 U.S.C. § 362(a)) (collectively, the “Guaranteed Obligations”).

 

7.2.                            Contribution by Guarantors.  (a) All Guarantors desire to allocate among
themselves (collectively, the “Contributing Guarantors”), in a fair and
equitable manner, their obligations arising under this Guaranty.  Accordingly, in the event any payment or
distribution is made on any date by a Guarantor (a “Funding Guarantor”) under
this Guaranty that exceeds its Fair Share as of such date, such Funding
Guarantor shall be entitled to a contribution from each of the other
Contributing Guarantors in the amount of such other Contributing Guarantor’s
Fair Share Shortfall as of such date, with the result that all such
contributions will cause each Contributing Guarantor’s Aggregate Payments to
equal its Fair Share as of such date.  “Fair Share”
means, with respect to a Contributing Guarantor as of any date of
determination, an amount equal to (a) the ratio of (i) the Fair Share
Contribution Amount with respect to such Contributing Guarantor to (ii) the
aggregate of the Fair Share Contribution Amounts with respect to all
Contributing Guarantors multiplied by (b) the aggregate amount paid or
distributed on or before such date by all Funding Guarantors under this
Guaranty in respect of the obligations Guaranteed.  “Fair Share Shortfall” means, with respect to a Contributing
Guarantor as of any date of determination, the excess, if any, of the Fair
Share of such Contributing Guarantor over the Aggregate Payments of such
Contributing Guarantor.  “Fair Share
Contribution Amount” means, with respect to a Contributing Guarantor
as of any date of determination, the maximum aggregate amount of the
obligations of such Contributing Guarantor under this Guaranty that

 

 

would not render its obligations hereunder or thereunder subject to
avoidance as a fraudulent transfer or conveyance under Section 548 of Title 11
of the United States Code or any comparable applicable provisions of state law;
provided, solely for purposes of calculating the “Fair Share Contribution Amount”
with respect to any Contributing Guarantor for purposes of this Section 7.2,
any assets or liabilities of such Contributing Guarantor arising by virtue of
any rights to subrogation, reimbursement or indemnification or any rights to or
obligations of contribution hereunder shall not be considered as assets or
liabilities of such Contributing Guarantor. 
“Aggregate
Payments” means, with respect to a Contributing Guarantor as of any
date of determination, an amount equal to (1) the aggregate amount of all
payments and distributions made on or before such date by such Contributing
Guarantor in respect of this Guaranty (including, without limitation, in
respect of this Section 7.2), minus (2) the aggregate amount of all payments
received on or before such date by such Contributing Guarantor from the other
Contributing Guarantors as contributions under this Section 7.2.  The amounts payable as contributions
hereunder shall be determined as of the date on which the related payment or
distribution is made by the applicable Funding Guarantor.  The allocation among Contributing Guarantors
of their obligations as set forth in this Section 7.2 shall not be construed in
any way to limit the liability of any Contributing Guarantor hereunder.  Each Guarantor is a third party beneficiary
to the contribution agreement set forth in this Section 7.2.

 

(b)  Anything contained in this Guaranty to the
contrary notwithstanding, if any Fraudulent Transfer Law (as hereinafter
defined) is determined by a court of competent jurisdiction to be applicable to
the obligations of any Guarantor under this Guaranty, such obligations of such
Guarantor hereunder shall be limited to a maximum aggregate amount equal to the
largest amount that would not render its obligations hereunder subject to
avoidance as a fraudulent transfer or conveyance under Section 548 of Title 11
of the United States Code or any applicable provisions of comparable state law
(collectively, the “Fraudulent Transfer Laws”), in each case
after giving effect to all other liabilities of such Guarantor, contingent or
otherwise, that are relevant under the Fraudulent Transfer Laws (specifically
excluding, however, any liabilities of such Guarantor (x) in respect of
intercompany indebtedness to Company or other affiliates of Company to the
extent that such indebtedness would be discharged in an amount equal to the
amount paid by such Guarantor hereunder and (y) under any guaranty of
Subordinated Indebtedness which guaranty contains a limitation as to maximum
amount similar to that set forth herein, pursuant to which the liability of
such Guarantor hereunder is included in the liabilities taken into account in
determining such maximum amount) and after giving effect as assets to the value
(as determined under the applicable provisions of the Fraudulent Transfer Laws)
of any rights to subrogation, reimbursement, indemnification or contribution of
such Guarantor pursuant to applicable law or pursuant to the terms of any
agreement (including without limitation any such right of contribution under
this Section 7.2.

 

7.3.                            Payment by Guarantors.  Subject
to Section 7.2, Guarantors hereby jointly and severally agree, in furtherance
of the foregoing and not in limitation of any other right which any Beneficiary
may have at law or in equity against any Guarantor by virtue hereof, that upon
the failure of Company to pay any of the Guaranteed Obligations when and as the
same shall become

 

 

due, whether at stated maturity, by required prepayment, declaration,
acceleration, demand or otherwise (including amounts that would become due but
for the operation of the automatic stay under Section 362(a) of the Bankruptcy
Code, 11 U.S.C.  § 362(a)), Guarantors
will upon demand pay, or cause to be paid, in Cash, to Administrative Agent for
the ratable benefit of Beneficiaries, an amount equal to the sum of the unpaid
principal amount of all Guaranteed Obligations then due as aforesaid, accrued
and unpaid interest on such Guaranteed Obligations (including interest which,
but for Company’s becoming the subject of a case under the Bankruptcy code,
would have accrued on such Guaranteed Obligations, whether or not a claim is
allowed against Company for such interest in the related bankruptcy case) and
all other Guaranteed Obligations then due and owing to Beneficiaries as
aforesaid.

 

7.4.                            Liability of Guarantors Absolute.  Each Guarantor agrees that its obligations
hereunder are irrevocable, absolute, independent and unconditional and shall
not be affected by any circumstance which constitutes a legal or equitable
discharge of a guarantor or surety other than payment in full of the Guaranteed
Obligations.  In furtherance of the
foregoing and without limiting the generality thereof, each Guarantor agrees as
follows, subject in each case to section 7.2.

 

(a)                                  this
Guaranty is a guaranty of payment when due and not of collectability.  This Guaranty is a primary obligation of
each Guarantor and not merely a contract of surety;

 

(b)                                 Administrative
Agent may enforce this Guaranty upon the actual occurrence and during the
continuance of an Event of Default notwithstanding the existence of any dispute
between Company and any Beneficiary with respect to the existence of such Event
of Default;

 

(c)                                  the
obligations of each Guarantor hereunder are independent of the obligations of
Company and the obligations of any other guarantor (including any other
Guarantor) of the obligations of Company, and a separate action or actions may
be brought and prosecuted against such Guarantor whether or not any action is
brought against Company or any of such other guarantors and whether or not
Company is joined in any such action or actions;

 

(d)                                 payment
by any Guarantor of a portion, but not all, of the Guaranteed Obligations shall
in no way limit, affect, modify or abridge any Guarantor’s liability for any
portion of the Guaranteed Obligations which has not been paid.  Without limiting the generality of the
foregoing, if Administrative Agent is awarded a judgment in any suit brought to
enforce any Guarantor’s covenant to pay a portion of the Guaranteed
Obligations, such judgment shall not be deemed to release such Guarantor from
its covenant to pay the portion of the Guaranteed Obligations that is not the
subject of such suit, and such judgment shall not, except to the extent
satisfied by such Guarantor, limit, affect, modify or abridge any other
Guarantor’s liability hereunder in respect of the Guaranteed Obligations;

 

(e)                                  any
Beneficiary, upon such terms as it deems appropriate, without notice or demand
and without affecting the validity or enforceability hereof or giving rise to
any reduction, limitation, impairment, discharge or termination of any
Guarantor’s liability hereunder, from time

 

 

to time may (i) renew,
extend, accelerate, increase the rate of interest on, or otherwise change the
time, place, manner or terms of payment of the Guaranteed Obligations; (ii)
settle, compromise, release or discharge, or accept or refuse any offer of
performance with respect to, or substitutions for, the Guaranteed Obligations
or any agreement relating thereto and/or subordinate the payment of the same to
the payment of any other obligations; (iii) request and accept other guaranties
of the Guaranteed Obligations and take and hold security for the payment hereof
or the Guaranteed Obligations; (iv) release, surrender, exchange, substitute,
compromise, settle, rescind, waive, alter, subordinate or modify, with or
without consideration, any security for payment of the Guaranteed Obligations,
any other guaranties of the Guaranteed Obligations, or any other obligation of
any Person (including any other Guarantor) with respect to the Guaranteed
Obligations; (v) enforce and apply any security now or hereafter held by or for
the benefit of such Beneficiary in respect hereof or the Guaranteed Obligations
and direct the order or manner of sale thereof, or exercise any other right or
remedy that such Beneficiary may have against any such security, in each case
as such Beneficiary in its discretion may determine consistent herewith or the
applicable Hedge Agreement and any applicable security agreement, including
foreclosure on any such security pursuant to one or more judicial or
nonjudicial sales, whether or not every aspect of any such sale is commercially
reasonable, and even though such action operates to impair or extinguish any
right of reimbursement or subrogation or other right or remedy of any Guarantor
against Company or any security for the Guaranteed Obligations; and (vi)
exercise any other rights available to it under the Credit Documents or the
Hedge Agreements; and

 

(f)                                    this
Guaranty and the obligations of Guarantors hereunder shall be valid and enforceable
and shall not be subject to any reduction, limitation, impairment, discharge or
termination for any reason (other than payment in full of the Guaranteed
Obligations), including the occurrence of any of the following, whether or not
any Guarantor shall have had notice or knowledge of any of them: (i) any
failure or omission to assert or enforce or agreement or election not to assert
or enforce, or the stay or enjoining, by order of court, by operation of law or
otherwise, of the exercise or enforcement of, any claim or demand or any right,
power or remedy (whether arising under the Credit Documents or the Hedge
Agreements, at law, in equity or otherwise) with respect to the Guaranteed
Obligations or any agreement relating thereto, or with respect to any other
guaranty of or security for the payment of the Guaranteed Obligations; (ii) any
rescission, waiver, amendment or modification of, or any consent to departure
from, any of the terms or provisions (including provisions relating to events
of default) hereof, any of the other Credit Documents, any of the Hedge
Agreements or any agreement or instrument executed pursuant thereto, or of any
other guaranty or security for the Guaranteed Obligations, in each case whether
or not in accordance with the terms hereof or such Credit Document, such Hedge
Agreement or any agreement relating to such other guaranty or security; (iii)
the Guaranteed Obligations, or any agreement relating thereto, at any time
being found to be illegal, invalid or unenforceable in any respect; (iv) the
application of payments received from any source (other than payments received
pursuant to the other Credit Documents or any of the Hedge Agreements or from
the proceeds of any security for the Guaranteed Obligations, except to the extent
such security also serves as collateral for indebtedness other than the
Guaranteed Obligations) to the

 

 

payment of indebtedness
other than the Guaranteed Obligations, even though any Beneficiary might have
elected to apply such payment to any part or all of the Guaranteed Obligations;
(v) any Beneficiary’s consent to the change, reorganization or termination of
the corporate structure or existence of Holdings or any of its Subsidiaries and
to any corresponding restructuring of the Guaranteed Obligations; (vi) any
failure to perfect or continue perfection of a security interest in any
collateral which secures any of the Guaranteed Obligations; (vii) any defenses,
set-offs or counterclaims which Company may allege or assert against any
Beneficiary in respect of the Guaranteed Obligations, including failure of
consideration, breach of warranty, payment, statute of frauds, statute of
limitations, accord and satisfaction and usury; and (viii) any other act or
thing or omission, or delay to do any other act or thing, which may or might in
any manner or to any extent vary the risk of any Guarantor as an obligor in
respect of the Guaranteed Obligations.

 

7.5.                            Waivers by Guarantors.  Each Guarantor hereby waives, for the benefit of
Beneficiaries:  (a) any right to require
any Beneficiary, as a condition of payment or performance by such Guarantor, to
(i) proceed against Company, any other guarantor (including any other
Guarantor) of the Guaranteed Obligations or any other Person, (ii) proceed
against or exhaust any security held from Company, any such other guarantor or
any other Person, (iii) proceed against or have resort to any balance of any
Deposit Account or credit on the books of any Beneficiary in favor of Company
or any other Person, or (iv) pursue any other remedy in the power of any
Beneficiary whatsoever; (b) any defense arising by reason of the incapacity,
lack of authority or any disability or other defense of Company or any other
Guarantor including any defense based on or arising out of the lack of validity
or the unenforceability of the Guaranteed Obligations or any agreement or
instrument relating thereto or by reason of the cessation of the liability of
Company or any other Guarantor from any cause other than payment in full of the
Guaranteed Obligations; (c) any defense based upon any statute or rule of law
which provides that the obligation of a surety must be neither larger in amount
nor in other respects more burdensome than that of the principal; (d) any
defense based upon any Beneficiary’s errors or omissions in the administration
of the Guaranteed Obligations, except behavior which amounts to bad faith,
gross negligence or willful misconduct; (e) (i) any principles or provisions of
law, statutory or otherwise, which are or might be in conflict with the terms
hereof and any legal or equitable discharge of such Guarantor’s obligations
hereunder, (ii) the benefit of any statute of limitations affecting such
Guarantor’s liability hereunder or the enforcement hereof, (iii) any rights to
set-offs, recoupments and counterclaims, and (iv) promptness, diligence and any
requirement that any Beneficiary protect, secure, perfect or insure any
security interest or lien or any property subject thereto; (f) notices,
demands, presentments, protests, notices of protest, notices of dishonor and
notices of any action or inaction, including acceptance hereof, notices of
default hereunder, the Hedge Agreements or any agreement or instrument related
thereto, notices of any renewal, extension or modification of the Guaranteed
Obligations or any agreement related thereto, notices of any extension of
credit to Company and notices of any of the matters referred to in Section 7.4
and any right to consent to any thereof; and (g) any defenses or benefits that
may be derived from or afforded by law which limit the liability of or
exonerate guarantors or sureties, or which may conflict with the terms hereof.

 

 

7.6.                            Guarantors’ Rights of Subrogation,
Contribution, etc.  Until the
Guaranteed Obligations shall have been indefeasibly paid in full and the
Revolving Commitments shall have terminated and all Letters of Credit shall
have expired or been cancelled, each Guarantor hereby waives any claim, right
or remedy, direct or indirect, that such Guarantor now has or may hereafter have
against Company or any other Guarantor or any of its assets in connection with
this Guaranty or the performance by such Guarantor of its obligations
hereunder, in each case whether such claim, right or remedy arises in equity,
under contract, by statute, under common law or otherwise and including without
limitation (a) any right of subrogation, reimbursement or indemnification that
such Guarantor now has or may hereafter have against Company with respect to
the Guaranteed Obligations, (b) any right to enforce, or to participate in, any
claim, right or remedy that any Beneficiary now has or may hereafter have
against Company, and (c) any benefit of, and any right to participate in, any
collateral or security now or hereafter held by any Beneficiary.  In addition, until the Guaranteed
Obligations shall have been indefeasibly paid in full and the Revolving
Commitments shall have terminated and all Letters of Credit shall have expired
or been cancelled, each Guarantor shall withhold exercise of any right of
contribution such Guarantor may have against any other guarantor (including any
other Guarantor) of the Guaranteed Obligations, including, without limitation,
any such right of contribution as contemplated by Section 7.2.  Each Guarantor further agrees that, to the
extent the waiver or agreement to withhold the exercise of its rights of
subrogation, reimbursement, indemnification and contribution as set forth
herein is found by a court of competent jurisdiction to be void or voidable for
any reason, any rights of subrogation, reimbursement or indemnification such
Guarantor may have against Company or against any collateral or security, and
any rights of contribution such Guarantor may have against any such other
guarantor, shall be junior and subordinate to any rights any Beneficiary may
have against Company, to all right, title and interest any Beneficiary may have
in any such collateral or security, and to any right any Beneficiary may have
against such other guarantor.  If any
amount shall be paid to any Guarantor on account of any such subrogation,
reimbursement, indemnification or contribution rights at any time when all
Guaranteed Obligations shall not have been finally and indefeasibly paid in
full, such amount shall be held in trust for Administrative Agent on behalf of
Beneficiaries and shall forthwith be paid over to Administrative Agent for the
benefit of Beneficiaries to be credited and applied against the Guaranteed
Obligations, whether matured or unmatured, in accordance with the terms hereof.

 

7.7.                            Subordination of Other Obligations.  Any Indebtedness of Company or any Guarantor
now or hereafter held by any Guarantor (the “Obligee Guarantor”) is
hereby subordinated in right of payment to the Guaranteed Obligations, and any
such indebtedness collected or received by the Obligee Guarantor after an Event
of Default has occurred and is continuing shall be held in trust for
Administrative Agent on behalf of Beneficiaries and shall forthwith be paid
over to Administrative Agent for the benefit of Beneficiaries to be credited
and applied against the Guaranteed Obligations but without affecting, impairing
or limiting in any manner the liability of the Obligee Guarantor under any
other provision hereof.

 

 

7.8.                            Continuing Guaranty.  This
Guaranty is a continuing guaranty and shall remain in effect until all of the
Guaranteed Obligations shall have been paid in full and the Revolving
Commitments shall have terminated and all Letters of Credit shall have expired
or been cancelled.  Each Guarantor
hereby irrevocably waives any right to revoke this Guaranty as to future
transactions giving rise to any Guaranteed Obligations.

 

7.9.                            Authority of Guarantors or Company.  It is not necessary for any Beneficiary to
inquire into the capacity or powers of any Guarantor or Company or the
officers, directors or any agents acting or purporting to act on behalf of any
of them.

 

7.10.                     Financial Condition of Company.  Any Credit Extension may be made to Company
or continued from time to time, and any Hedge Agreements may be entered into
from time to time, in each case without notice to or authorization from any
Guarantor regardless of the financial or other condition of Company at the time
of any such grant or continuation or at the time such Hedge Agreement is
entered into, as the case may be.  No
Beneficiary shall have any obligation to disclose or discuss with any Guarantor
its assessment, or any Guarantor’s assessment, of the financial condition of
Company.  Each Guarantor has adequate
means to obtain information from Company on a continuing basis concerning the
financial condition of Company and its ability to perform its obligations under
the Credit Documents and the Hedge Agreements, and each Guarantor assumes the
responsibility for being and keeping informed of the financial condition of
Company and of all circumstances bearing upon the risk of nonpayment of the
Guaranteed Obligations.  Each Guarantor
hereby waives and relinquishes any duty on the part of any Beneficiary to
disclose any matter, fact or thing relating to the business, operations or
conditions of Company now known or hereafter known by any Beneficiary.

 

7.11.                     Bankruptcy, etc.  (a)  So long as any Guaranteed Obligations remain outstanding, no
Guarantor shall, without the prior written consent of Administrative Agent
acting pursuant to the instructions of Requisite Lenders, commence or join with
any other Person in commencing any bankruptcy, reorganization or insolvency
case or proceeding of or against Company or any other Guarantor.  The obligations of Guarantors hereunder
shall not be reduced, limited, impaired, discharged, deferred, suspended or
terminated by any case or proceeding, voluntary or involuntary, involving the
bankruptcy, insolvency, receivership, reorganization, liquidation or
arrangement of Company or any other Guarantor or by any defense which Company
or any other Guarantor may have by reason of the order, decree or decision of
any court or administrative body resulting from any such proceeding.

 

(b)                                 Each
Guarantor acknowledges and agrees that any interest on any portion of the
Guaranteed Obligations which accrues after the commencement of any case or
proceeding referred to in clause (a) above (or, if interest on any portion of
the Guaranteed Obligations ceases to accrue by operation of law by reason of
the commencement of such case or proceeding, such interest as would have
accrued on such portion of the Guaranteed Obligations if such case or
proceeding had not been commenced) shall be included in the Guaranteed
Obligations because it is the intention of Guarantors and Beneficiaries that
the Guaranteed Obligations which are

 

 

Guaranteed by Guarantors
pursuant hereto should be determined without regard to any rule of law or order
which may relieve Company of any portion of such Guaranteed Obligations.  Guarantors will permit any trustee in
bankruptcy, receiver, debtor in possession, assignee for the benefit of
creditors or similar person to pay Administrative Agent, or allow the claim of
Administrative Agent in respect of, any such interest accruing after the date
on which such case or proceeding is commenced.

 

(c)                                  In
the event that all or any portion of the Guaranteed Obligations are paid by
Company, the obligations of Guarantors hereunder shall continue and remain in
full force and effect or be reinstated, as the case may be, in the event that
all or any part of such payment(s) are rescinded or recovered directly or
indirectly from any Beneficiary as a preference, fraudulent transfer or
otherwise, and any such payments which are so rescinded or recovered shall
constitute Guaranteed Obligations for all purposes hereunder.

 

7.12.                     Discharge of Guaranty Upon Sale of
Guarantor.  If all of the Capital Stock of any Guarantor
or any of its successors in interest hereunder shall be sold or otherwise disposed
of (including by merger or consolidation) in accordance with the terms and
conditions hereof, the Guaranty of such Guarantor or such successor in
interest, as the case may be, hereunder shall automatically be discharged and
released without any further action by any Beneficiary or any other Person
effective as of the time of such Asset Sale.

 

SECTION 8.  EVENTS OF
DEFAULT

 

8.1.                            Events of Default.  If
any one or more of the following conditions or events shall occur:

 

(a)                                  Failure
to Make Payments When Due.  Failure
by Company to pay (i) when due any installment of principal of any Loan,
whether at stated maturity, by acceleration, by notice of voluntary prepayment,
by mandatory prepayment or otherwise; (ii) within three Business Days after the
date when due any amount payable to Issuing Bank in reimbursement of any
drawing under a Letter of Credit; or (iii) any interest on any Loan or any fee
or any other amount due hereunder within five Business Days after the date due;
or

 

(b)                                 Default
in Other Agreements.  (i)  Failure of any Credit Party to pay when due
any principal of or interest on or any other amount payable in respect of one
or more items of Indebtedness for Borrowed Money (other than Indebtedness for
Borrowed Money referred to in Section 8.1(a)) in an individual or aggregate
amount of  $10,000,000 or more beyond
the grace period, if any, provided therefor; or (ii) breach or default by any
Credit Party with respect to any other material term of (1) one or more items
of Indebtedness for Borrowed Money in the individual or aggregate principal
amount referred to in clause (i) above or (2) any loan agreement, mortgage,
indenture or other agreement relating to such item(s) of Indebtedness, in each
case beyond the grace period, if any, provided therefor, if the effect of such
breach or default is to cause, or to permit the holder or holders of that
Indebtedness (or a trustee on behalf

 

 

of such holder or
holders), to cause, that Indebtedness to become or be declared due and payable
(or redeemable) prior to its stated maturity or the stated maturity of any
underlying obligation, as the case may be; or

 

(c)                                  Breach
of Certain Covenants.  Failure of
any Credit Party to perform or comply with any term or condition contained in
Section 2.6, Section 5.2 (with respect to existence) or Section 6; or

 

(d)                                 Breach
of Representations, etc.  Any
representation, warranty, certification or other statement made or deemed made
by any Credit Party in any Credit Document or in any statement or certificate
at any time given by any Credit Party in writing pursuant hereto or thereto or
in connection herewith or therewith shall be false in any material respect as
of the date made or deemed made; or

 

(e)                                  Other
Defaults Under Credit Documents. 
Any Credit Party shall default in the performance of or compliance with
any term contained herein or any of the other Credit Documents, other than any
such term referred to in any other Section of this Section 8.1, and such
default shall not have been remedied or waived (y) within five days in the case
of a default under Section 5.1(f) and (z) otherwise, within thirty (30) days
after receipt by Company of notice from Administrative Agent or Required
Lenders of such default; or

 

(f)                                    Involuntary
Bankruptcy; Appointment of Receiver, etc. 
(i) A court of competent jurisdiction shall enter a decree or order for
relief in respect of any Credit Party in an involuntary case under the
Bankruptcy Code or under any other applicable bankruptcy, insolvency or similar
law now or hereafter in effect, which decree or order is not stayed within
thirty days; or any other similar relief shall be granted under any applicable
federal or state law; or (ii) an involuntary case shall be commenced against
any Credit Party under the Bankruptcy Code or under any other applicable
bankruptcy, insolvency or similar law now or hereafter in effect; or a decree
or order of a court having jurisdiction in the premises for the appointment of
a receiver, liquidator, sequestrator, trustee, custodian or other officer
having similar powers over any Credit Party, or over all or a substantial part
of its property, shall have been entered; or there shall have occurred the
involuntary appointment of an interim receiver, trustee or other custodian of
any Credit Party for all or a substantial part of its property; or a warrant of
attachment, execution or similar process shall have been issued against any
substantial part of the property of any Credit Party, and any such event
described in this clause Section 8.1(f)(ii) shall continue for sixty (60) days
without having been dismissed, bonded or discharged; or

 

(g)                                 Voluntary
Bankruptcy; Appointment of Receiver, etc. 
(i) Any Credit Party shall commence a voluntary case under the
Bankruptcy Code or under any other applicable bankruptcy, insolvency or similar
law now or hereafter in effect, or shall consent to the entry of an order for
relief in an involuntary case, or to the conversion of an involuntary case to a
voluntary case, under any such law, or shall consent to the appointment of or
taking possession by a receiver, trustee or other custodian for all or a
substantial part of its property; or any Credit

 

 

Party shall make any
assignment for the benefit of creditors; or (ii) any Credit Party shall be
unable, or shall fail generally, or shall admit in writing its inability, to
pay its debts as such debts become due; or the board of directors (or similar
governing body) of any Credit Party (or any committee thereof) shall adopt any
resolution or otherwise authorize any action to approve any of the actions
referred to herein or in Section 8.1(f); or

 

(h)                                 Judgments
and Attachments.  Any money
judgment, writ or warrant of attachment or similar process involving
individually or in the aggregate an amount in excess of $10,000,000 (to the
extent not adequately covered by insurance) shall be entered or filed against a
Credit Party or any of material portion of their respective assets and shall
remain undischarged, unvacated, unbonded or unstayed for a period of sixty (60)
days (or in any event later than five days prior to the date of any proposed
sale thereunder); or

 

(i)                                     Dissolution.  Any order, judgment or decree shall be
entered against any Credit Party decreeing its involuntary dissolution or split
up of such Credit Party and such order shall remain undischarged or unstayed
for a period in excess of sixty days; or

 

(j)                                     Employee
Benefit Plans.  There shall occur
one or more ERISA Events which individually or in the aggregate results in or
might reasonably be expected to result in liability of the Company, Holdings,
any of their Subsidiaries or any of their respective ERISA Affiliates in excess
of $10,000,000 during the term hereof; or there shall exist an amount of
unfunded benefit liabilities (as defined in Section 4001(a)(18) of ERISA),
individually or in the aggregate for all Pension Plans that in the
determination of the Administrative Agent could reasonably be expected to have
a Material Adverse Effect; or

 

(k)                                  Change
of Control.  A Change of Control
shall occur; or

 

(l)                                     Guaranties,
Collateral Documents and other Credit Documents.  At any time after the execution and delivery and prior to
termination in accordance with its terms thereof, (i) the Guaranty for any
reason, other than the satisfaction in full of all Obligations, shall cease to be
in full force and effect (other than in accordance with its terms) or shall be
declared to be null and void or any Guarantor shall repudiate its obligations
thereunder, (ii) this Agreement or any Collateral Document ceases to be in full
force and effect (other than by reason of a release of Collateral in accordance
with the terms hereof or thereof or the satisfaction in full of the Obligations
in accordance with the terms hereof) or shall be declared null and void, or
Collateral Agent shall not have or shall cease to have a valid and perfected
Lien in any material portion of the Collateral purported to be covered by the
Collateral Documents with the priority required by the relevant Collateral
Document, in each case for any reason other than the failure of Collateral
Agent or any Secured Party to take any action within its control, or (iii) any
Credit Party shall contest the validity or enforceability of any Credit
Document in writing or deny in writing that it has any further liability,
including with respect to future advances by Lenders, under any Credit Document
to which it is a party; or

 

 

(m)                               Equity
Purchases.  Within one hundred and
twenty (120) days after the Closing Date, Sponsor and/or its Affiliates and
Permitted Investors shall have failed to purchase additional common stock of
Holdings in an amount sufficient to make the total aggregate cash purchase
price of all common stock of Holdings purchased at least $175,000,000;

 

THEN,
(1) upon the occurrence of any Event of Default described in Section 8.1(f) or
8.1(g), automatically, and (2) upon the occurrence of any other Event of
Default, at the request of (or with the consent of) Requisite Lenders, upon
notice to Company by Administrative Agent, (A) the Revolving Commitments, if
any, of each Lender having such Revolving Commitments and the obligation of
Issuing Bank to issue any Letter of Credit shall immediately terminate; (B)
each of the following shall immediately become due and payable, in each case
without presentment, demand, protest or other requirements of any kind, all of
which are hereby expressly waived by each Credit Party: (I) the unpaid
principal amount of and accrued interest on the Loans, (II) all other
Obligations; provided, the foregoing shall not affect in any way the
obligations of Lenders under Section 2.3(b)(iv) or Section 2.4(e); (C) the
Administrative Agent may cause the Collateral Agent to enforce any and all
Liens and security interests created pursuant to Collateral Documents; and (D)
Administrative Agent may direct Company to pay (and Company hereby agrees upon
receipt of such notice, or upon the occurrence of any Event of Default
specified in Section 8.1(f) and (g) to pay) to Administrative Agent such
additional amounts of cash, to be held as security for Company’s reimbursement
Obligations in respect of Letters of Credit then outstanding, equal to the
Letter of Credit Usage at such time.

 

SECTION 9.  AGENTS

 

9.1.                            Appointment of Agents.  GSCP and LBI are hereby appointed Joint Arrangers and Joint Book
Managers hereunder, and each Lender hereby authorizes Joint Arrangers and Joint
Book Managers to act as its agents in accordance with the terms hereof and the
other Credit Documents. LCP is hereby appointed Collateral Agent and
Administrative Agent hereunder, and each Lender hereby authorizes Collateral
Agent and Administrative Agent to act as its agents in accordance with the
terms hereof and the other Credit Documents. 
GSCP is hereby appointed Syndication Agent hereunder and under the other
Credit Documents and each Lender hereby authorizes Syndication Agent to act as
its agent in accordance with the terms hereof and the other Credit
Documents.  Each Agent hereby agrees to
act upon the express conditions contained herein and the other Credit Documents,
as applicable.  The provisions of this
Section 9 are solely for the benefit of Agents and Lenders and, except as set
forth under Section 9.7, no Credit Party shall have any rights as a third party
beneficiary of any of the provisions thereof. 
In performing its functions and duties hereunder, each Agent shall act
solely as an agent of Lenders and does not assume and shall not be deemed to
have assumed any obligation towards or relationship of agency or trust with or
for Holdings or any of its Subsidiaries. 
Each of Agent without consent of or notice to any party hereto, may
assign any and all of its rights or obligations hereunder to any of its
Affiliates.  As of the Closing Date, all
the respective obligations of GSCP and LBI, in their capacity as Joint
Arrangers and Joint Book Managers, and GSCP, in its capacity as Syndication
Agent, shall terminate.

 

 

9.2.                            Powers and Duties.  Each Lender
irrevocably authorizes each Agent to take such action on such Lender’s behalf
and to exercise such powers, rights and remedies hereunder and under the other
Credit Documents as are specifically delegated or granted to such Agent by the
terms hereof and thereof, together with such powers, rights and remedies as are
reasonably incidental thereto.  Each
Agent shall have only those duties and responsibilities that are expressly
specified herein and the other Credit Documents.  Each Agent may exercise such powers, rights and remedies and
perform such duties by or through its agents or employees.  No Agent shall have, by reason hereof or any
of the other Credit Documents, a fiduciary relationship in respect of any
Lender; and nothing herein or any of the other Credit Documents, expressed or
implied, is intended to or shall be so construed as to impose upon any Agent
any obligations in respect hereof or any of the other Credit Documents except
as expressly set forth herein or therein.

 

9.3.                            General Immunity.

 

(a)                                  No
Responsibility for Certain Matters. 
No Agent shall be responsible to any Lender for the execution,
effectiveness, genuineness, validity, enforceability, collectability or
sufficiency hereof or any other Credit Document or for any representations,
warranties, recitals or statements made herein or therein or made in any
written or oral statements or in any financial or other statements,
instruments, reports or certificates or any other documents furnished or made
by any of Agent to Lenders or by or on behalf of any Credit Party to any Agent
or any Lender in connection with the Credit Documents and the transactions
contemplated thereby or for the financial condition or business affairs of any
Credit Party or any other Person liable for the payment of any Obligations, nor
shall any Agent be required to ascertain or inquire as to the performance or
observance of any of the terms, conditions, provisions, covenants or agreements
contained in any of the Credit Documents or as to the use of the proceeds of
the Loans or as to the existence or possible existence of any Event of Default
or Default.  Anything contained herein
to the contrary notwithstanding, Administrative Agent shall not have any
liability arising from confirmations of the amount of outstanding Loans or the
Letter of Credit Usage or the component amounts thereof.

 

(b)                                 Exculpatory
Provisions.  No Agent nor any of its
officers, partners, directors, employees or agents shall be liable to Lenders
for any action taken or omitted by any Agent under or in connection with any of
the Credit Documents except to the extent caused by such Agent’s gross
negligence or willful misconduct.  Each
Agent shall be entitled to refrain from any act or the taking of any action
(including the failure to take an action) in connection herewith or any of the
other Credit Documents or from the exercise of any power, discretion or
authority vested in it hereunder or thereunder unless and until such Agent
shall have received instructions in respect thereof from Requisite Lenders (or
such other Lenders as may be required to give such instructions under Section
10.5) and, upon receipt of such instructions from Requisite Lenders (or such
other Lenders, as the case may be), such Agent shall be entitled to act or
(where so instructed) refrain from acting, or to exercise such power,
discretion or authority, in accordance

 

 

with such
instructions.  Without prejudice to the
generality of the foregoing, (i) each Agent shall be entitled to rely, and
shall be fully protected in relying, upon any communication, instrument or
document believed by it to be genuine and correct and to have been signed or
sent by the proper Person or Persons, and shall be entitled to rely and shall
be protected in relying on opinions and judgments of attorneys (who may be
attorneys for Holdings and its Subsidiaries), accountants, experts and other
professional advisors selected by it; and (ii) no Lender shall have any right
of action whatsoever against any Agent as a result of such Agent acting or
(where so instructed) refraining from acting hereunder or any of the other
Credit Documents in accordance with the instructions of Requisite Lenders (or
such other Lenders as may be required to give such instructions under Section
10.5).

 

9.4.                            Agents Entitled to Act as Lender.  The agency hereby created shall in no way
impair or affect any of the rights and powers of, or impose any duties or
obligations upon, any Agent in its individual capacity as a Lender
hereunder.  With respect to its
participation in the Loans and the Letters of Credit, each Agent shall have the
same rights and powers hereunder as any other Lender and may exercise the same
as if it were not performing the duties and functions delegated to it
hereunder, and the term “Lender” shall, unless the context clearly otherwise
indicates, include each Agent in its individual capacity.  Any Agent and its Affiliates may accept deposits
from, lend money to and generally engage in any kind of banking, trust,
financial advisory or other business with Holdings or any of its Affiliates as
if it were not performing the duties specified herein, and may accept fees and
other consideration from Company for services in connection herewith and
otherwise without having to account for the same to Lenders.

 

9.5.                            Lenders’ Representations, Warranties
and Acknowledgment.

 

(a)                                  Each
Lender represents and warrants that it has made its own independent
investigation of the financial condition and affairs of Holdings and its
Subsidiaries in connection with Credit Extensions hereunder and that it has
made and shall continue to make its own appraisal of the creditworthiness of
Holdings and its Subsidiaries.  No Agent
shall have any duty or responsibility, either initially or on a continuing
basis, to make any such investigation or any such appraisal on behalf of
Lenders or to provide any Lender with any credit or other information with
respect thereto, whether coming into its possession before the making of the
Loans or at any time or times thereafter, and no Agent shall have any
responsibility with respect to the accuracy of or the completeness of any
information provided to Lenders.

 

(b)                                 Each
Lender, by delivering its signature page to this Agreement and funding its
Tranche A Term Loan, Tranche B Term Loan and/or a Revolving Loan on the Closing
Date, shall be deemed to have acknowledged receipt of, and consented to and
approved, each Credit Document and each other document required to be approved
by any Agent, Requisite Lenders or Lenders, as applicable on the Closing Date.

 

9.6.                            Right to Indemnity.  Each
Lender, in proportion to its Pro Rata Share, severally agrees to indemnify each
Agent, to the extent that such Agent shall not have been reimbursed by any

 

 

Credit Party, for and against any and all liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses
(including counsel fees and disbursements) or disbursements of any kind or
nature whatsoever which may be imposed on, incurred by or asserted against such
Agent in exercising its powers, rights and remedies or performing its duties
hereunder or under the other Credit Documents or otherwise in its capacity as
such Agent in any way relating to or arising out hereof or the other Credit
Documents; provided, no Lender shall be liable for any portion of such
liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses or disbursements resulting from such Agent’s gross
negligence or willful misconduct.  If
any indemnity furnished to any Agent for any purpose shall, in the opinion of
such Agent, be insufficient or become impaired, such Agent may call for
additional indemnity and cease, or not commence, to do the acts indemnified against
until such additional indemnity is furnished; provided, in no event
shall this sentence require any Lender to indemnify any Agent against any
liability, obligation, loss, damage, penalty, action, judgment, suit, cost,
expense or disbursement in excess of such Lender’s Pro Rata Share thereof; and provided
further, this sentence shall not be deemed to require any Lender to
indemnify any Agent against any liability, obligation, loss, damage, penalty,
action, judgment, suit, cost, expense or disbursement described in the proviso
in the immediately preceding sentence.

 

9.7.                            Successor Administrative Agent and
Swing Line Lender.  Administrative Agent may resign at any time
by giving thirty days’ prior written notice thereof to Lenders and Company, and
Administrative Agent may be removed at any time with or without cause by an
instrument or concurrent instruments in writing delivered to Company and
Administrative Agent and signed by Requisite Lenders.  Upon any such notice of resignation or any such removal, Requisite
Lenders shall have the right, to appoint a successor Administrative Agent which
appointment shall be subject to the prior written approval of the Company
(which shall not be unreasonably withheld)). 
Upon the acceptance of any appointment as Administrative Agent hereunder
by a successor Administrative Agent, that successor Administrative Agent shall
thereupon succeed to and become vested with all the rights, powers, privileges
and duties of the retiring or removed Administrative Agent and the retiring or
removed Administrative Agent shall promptly (i) transfer to such successor
Administrative Agent all sums, Securities and other items of Collateral held
under the Collateral Documents, together with all records and other documents
necessary or appropriate in connection with the performance of the duties of
the successor Administrative Agent under the Credit Documents, and (ii) execute
and deliver to such successor Administrative Agent such amendments to financing
statements, and take such other actions, as may be necessary or appropriate in
connection with the assignment to such successor Administrative Agent of the
security interests created under the Collateral Documents, whereupon such
retiring or removed Administrative Agent shall be discharged from its duties
and obligations hereunder.  After any
retiring or removed Administrative Agent’s resignation or removal 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 Agent
hereunder.  Any resignation or removal
of Administrative Agent pursuant to this Section shall also constitute the
resignation or removal of LCP or its successor as Swing Line Lender, and any
successor Administrative Agent appointed pursuant to this Section shall, upon
its acceptance of such appointment, become a successor

 

 

Swing Line Lender for all purposes hereunder.  In such event (a) Company shall prepay any outstanding Swing Line
Loans made by the retiring or removed Administrative Agent in its capacity as
Swing Line Lender, (b) upon such prepayment, the retiring or removed
Administrative Agent and Swing Line Lender shall surrender any Swing Line Note
held by it to Company for cancellation, and (c) Company shall issue, if so
requested by Successor Administrative Agent and Swing Line Loan Lender, a new
Swing Line Note to the successor Administrative Agent and Swing Line Lender, in
the principal amount of the Swing Line Loan Sublimit then in effect and with
other appropriate insertions.

 

9.8.                            Collateral Documents and Guaranty.

 

(a)                                  Agents
under Collateral Documents and Guaranty. 
Each Lender hereby further authorizes Administrative Agent or Collateral
Agent, as applicable, on behalf of and for the benefit of Lenders, to be the agent
for and representative of Lenders with respect to the Guaranty, the Collateral
and the Collateral Documents.  Subject
to Section 10.5, without further written consent or authorization from Lenders,
each of Administrative Agent and Collateral Agent, as applicable, may execute
any documents or instruments necessary to (i) release any Lien encumbering any
item of Collateral that is the subject of a sale or other disposition of assets
permitted hereby or to which Requisite Lenders (or such other Lenders as may be
required to give such consent under Section 10.5) have otherwise consented or
(ii) release any Guarantor from the Guaranty pursuant to Section 7.13 or with
respect to which Requisite Lenders (or such other Lenders as may be required to
give such consent under Section 10.5) have otherwise consented.

 

(b)                                 Right
to Realize on Collateral and Enforce Guaranty.  Anything contained in any of the Credit Documents to the contrary
notwithstanding, Company, Administrative Agent, Collateral Agent and each Lender
hereby agree that (i) no Lender shall have any right individually to realize
upon any of the Collateral or to enforce the Guaranty, it being understood and
agreed that all powers, rights and remedies hereunder may be exercised solely
by Administrative Agent, on behalf of Lenders in accordance with the terms
hereof, and all powers, rights and remedies under the Collateral Documents may
be exercised solely by Collateral Agent and (ii) in the event of a foreclosure
by Collateral Agent on any of the Collateral pursuant to a public or private
sale, Administrative Agent or any Lender may be the purchaser of any or all of
such Collateral at any such sale and Collateral Agent, as agent for and
representative of Secured Parties (but not any Lender or Lenders in its or
their respective individual capacities unless Requisite Lenders shall otherwise
agree in writing) shall be entitled, for the purpose of bidding and making
settlement or payment of the purchase price for all or any portion of the
Collateral sold at any such public sale, to use and apply any of the
Obligations as a credit on account of the purchase price for any collateral
payable by Collateral Agent at such sale.

 

 

SECTION 10. 
MISCELLANEOUS

 

10.1.                     Notices.  Unless otherwise specifically provided herein,
any notice or other communication herein required or permitted to be given to a
Credit Party, a Lead Arranger, Syndication Agent, Collateral Agent,
Administrative Agent, Swing Line Lender or Issuing Bank, shall be sent to such
Person’s address as set forth on Appendix B or in the other relevant Credit
Document, and in the case of any Lender, the address as indicated on Appendix B
or otherwise indicated to Administrative Agent in writing.  Each notice hereunder shall be in writing
and may be personally served, telexed or sent by telefacsimile or United States
mail or courier service and shall be deemed to have been given on the date of
receipt.

 

10.2.                     Expenses.  Whether or not the transactions contemplated
hereby shall be consummated, Company agrees to pay promptly, after its receipt
of a written invoice therefor: (a) all the actual and reasonable out-of-pocket
costs and expenses of the Agents with respect to preparation of the Credit
Documents and any consents, amendments, waivers or other modifications thereto
and the transactions contemplated thereby; (b) all the costs of furnishing all
opinions by counsel for Company and the other Credit Parties as may be required
under the Credit Documents; (c) the reasonable fees, expenses and disbursements
of counsel to Agents (in each case including, without limitation, the
reasonable fees and expenses of legal counsel (with one counsel for all Agents
other than during the continuance of an Event of Default) and solvency experts
(with respect to solvency experts, on the Closing Date only)) in connection
with the negotiation, preparation, execution and administration of the Credit
Documents and any consents, amendments, waivers or other modifications thereto
and any other documents or matters requested by Company; (d) all the actual
out-of-pocket costs and reasonable expenses of the Administrative Agent and the
Collateral Agent with respect to creating and perfecting Liens in favor of
Collateral Agent, for the benefit of Lenders pursuant hereto and in connection
with the custody, continued perfection or preservation of any of the
Collateral, including filing, registration and recording fees, expenses and
taxes, stamp or documentary taxes, search fees, title insurance premiums and
reasonable fees, expenses and disbursements of counsel to each such Agent; (e)
all other actual and reasonable out-of-pocket costs and expenses incurred by
each Agent, within one hundred and eighty (180) days after the Closing Date, in
connection with the primary syndication of the Loans and Commitments; and (f)
after the occurrence and during the continuance of an Event of Default, all
out-of-pocket costs and expenses, including reasonable attorneys’ fees and
costs of settlement, incurred by any Agent or any Lender in enforcing any
Obligations of or in collecting any payments due from any Credit Party
hereunder or under the other Credit Documents (i) by reason of such Event of
Default (including in connection with the sale of, collection from, or other
realization upon any of the Collateral or the enforcement of the Guaranty) or
(ii) in connection with any refinancing or restructuring of the credit
arrangements provided hereunder in the nature of a “work-out” or pursuant to
any insolvency or bankruptcy cases or proceedings.

 

10.3.                     Indemnity.  In addition to the payment of expenses
pursuant to Section 10.2, whether or not the transactions contemplated hereby
shall be consummated, each Credit Party agrees to defend (with one counsel
reasonably acceptable to the Company for all Indemnitees (to the extent
practicable)), indemnify, pay and hold harmless, each Agent, Lender and
Affiliates of each Agent

 

 

and Lender and the officers, partners, directors, trustees, employees,
agents of each such person (each, an “Indemnitee”), from and against any and all
Indemnified Liabilities; provided, no Credit Party shall have any
obligation to any Indemnitee hereunder with respect to any Indemnified
Liabilities to the extent such Indemnified Liabilities arise from the gross
negligence or willful misconduct of that Indemnitee (or any of its Affiliates,
directors, officers, employees, advisors, attorneys or agents).  To the extent that the undertakings to
defend, indemnify, pay and hold harmless set forth in this Section 10.3 may be
unenforceable in whole or in part because they are violative of any law or
public policy, subject to the proviso in the preceding sentence the applicable
Credit Party shall contribute the maximum portion that it is permitted to pay
and satisfy under applicable law to the payment and satisfaction of all
Indemnified Liabilities incurred by Indemnitees or any of them.  To the extent permitted by applicable law,
no Credit Party shall assert, and each hereby waives, any claim against any
Indemnitee, on any theory of liability, for special, indirect, consequential or
punitive damages (as opposed to direct or actual damages) arising out of, in
connection with, or as a result of, any Credit Document or any agreement or
instrument or transaction contemplated hereby.

 

10.4.                     Amendments and Waivers.

 

(a)                                  Requisite
Lenders’ Consent.  Subject to
Section 10.4(b) and 10.4(c), no amendment, modification, termination or waiver
of any provision of the Credit Documents, shall in any event be effective
without the written concurrence of the Company and Requisite Lenders (or the
Administrative Agent acting with the consent of the Requisite Lenders), and any
provision of this Agreement may be waived by the Requisite Lenders (or the
Administrative Agent acting with the consent of the Requisite Lenders).

 

(b)                                 Affected
Lenders’ Consent.  Without the
written consent of each Lender  (other
than a Defaulting Lender) that would be affected thereby, no amendment,
modification, termination, or consent shall be effective if the effect thereof
would:

 

(i)                                     extend
the scheduled final maturity of any Loan or Note;

 

(ii)                                  except
as permitted under Section 6.9 of this Agreement, consent to the assignment or
transfer by any Credit Party of any of its rights and obligations under any
Credit Document;

 

(iii)                               extend the stated
expiration date of any Letter of Credit beyond the Revolving Commitment
Termination Date;

 

(iv)                              reduce
the rate of interest on any Loan (other than any waiver of any increase in the
interest rate applicable to any Loan pursuant to Section 2.10) or any fee, in
each case payable to such Lender hereunder;

 

 

(v)                                 extend
the time for payment of any such interest or fees;

 

(vi)                              reduce
the principal amount of any Loan or any reimbursement obligation in respect of
any Letter of Credit;

 

(vii)                           amend, modify, terminate or
waive any provision of this Section 10.4(b) or Section 10.4(c);

 

(viii)                        amend the definition of “Requisite
Lenders” or “Pro Rata Share”; provided, with
the consent of Requisite Lenders, additional extensions of credit pursuant
hereto may be included in the determination of “Requisite Lenders” or “Pro Rata
Share” on substantially the same basis as the Term Loan Commitments,
the Term Loans, the Revolving Commitments and the Revolving Loans are included
on the Closing Date; or

 

(ix)                                release
or otherwise subordinate all or substantially all of the Collateral or all or
substantially all of the Guarantors from the Guaranty except as expressly
provided in the Credit Documents.

 

(c)                                  Other
Consents.  No amendment,
modification, termination or waiver of any provision of the Credit Documents,
or consent to any departure by any Credit Party therefrom, shall:

 

(i)                                     increase
any Revolving Commitment of any Lender over the amount thereof then in effect
without the consent of such Lender; provided, no amendment, modification
or waiver of any condition precedent, covenant, Default or Event of Default
shall constitute an increase in any Revolving Commitment of any Lender;

 

(ii)                                  amend,
modify, terminate or waive any provision hereof relating to the Swing Line
Sublimit or the Swing Line Loans without the consent of Swing Line Lender;

 

(iii)                               amend the definition of “Requisite
Class Lenders” without the consent of Requisite Class Lenders of
each Class; provided, with the consent of the Requisite Lenders,
additional extensions of credit pursuant hereto may be included in the
determination of such “Requisite Class Lenders” on substantially
the same basis as the Term Loan Commitments, the Term Loans, the Revolving
Commitments and the Revolving Loans are included on the Closing Date;

 

(iv)                              alter
the required application of any repayments or prepayments as between Classes
pursuant to Section 2.15 without the consent of Requisite Class Lenders of each
Class which is being allocated a lesser repayment or prepayment as a result
thereof; provided, Requisite Lenders may waive, in whole or in part, any
prepayment so long as the application, as between Classes, of any portion of
such prepayment which is still required to be made is not altered;

 

 

(v)                                 amend,
modify, terminate or waive any obligation of Lenders relating to the purchase
of participations in Letters of Credit as provided in Section 2.4(e) without
the written consent of Administrative Agent and of the applicable Issuing Bank;

 

(vi)                              amend,
modify, terminate or waive any provision of Section 9 as the same applies to
any Agent, or any other provision hereof as the same applies to the rights or
obligations of any Agent, in each case without the consent of such Agent; or

 

(vii)                           without the consent of
holders of 66 2/3% of the aggregate
principal amount of any Class of Loans outstanding, waive, reduce or postpone
any scheduled repayment (but not prepayment) of such Class.

 

(d)                                 Execution
of Amendments, etc.  Administrative
Agent may, but shall have no obligation to, with the concurrence of any Lender,
execute amendments, modifications, waivers or consents on behalf of such
Lender.  Any waiver or consent shall be
effective only in the specific instance and for the specific purpose for which
it was given.  No notice to or demand on
any Credit Party in any case shall entitle any Credit Party to any other or
further notice or demand in similar or other circumstances.  Any amendment, modification, termination,
waiver or consent effected in accordance with this Section 10.4 shall be
binding upon each Lender at the time outstanding, each future Lender and, if
signed by a Credit Party, on such Credit Party.

 

10.5.                     Successors and Assigns;
Participations.

 

(a)                                  Generally.  This Agreement shall be binding upon the
parties hereto and their respective successors and assigns and shall inure to
the benefit of the parties hereto and the successors and assigns of
Lenders.  Except as permitted under
Section 6.9 of this Agreement, no Credit Party’s rights or obligations
hereunder nor any interest therein may be assigned or delegated by any Credit
Party without the prior written consent of all Lenders.

 

(b)                                 Register.  Company, Administrative Agent and Lenders
shall deem and treat the Persons listed as Lenders in the Register as the
holders and owners of the corresponding Commitments and Loans listed therein
for all purposes hereof, and no assignment or transfer of any such Commitment
or Loan shall be effective, in each case, unless and until an Assignment
Agreement effecting the assignment or transfer thereof shall have been
delivered to and accepted by Administrative Agent and, if applicable, the
Company and recorded in the Register as provided in Section 10.5(e).  Prior to such recordation, all amounts owed
with respect to the applicable Commitment or Loan shall be owed to the Lender
listed in the Register as the owner thereof, and any request, authority or
consent of any Person who, at the time of making such request or giving such
authority or consent, is listed in the Register as a Lender shall be conclusive
and binding on any subsequent holder, assignee or transferee of the
corresponding Commitments or Loans.

 

 

(c)                                  Right
to Assign.  Each Lender shall have
the right at any time to sell, assign or transfer all or a portion of its
rights and obligations under this Agreement, including, without limitation, all
or a portion of its Commitments or Loans owing to it, Note or Notes held by it,
or other Obligation; provided, however, that each such assignment
shall be of a uniform, and not varying, percentage of all rights and obligations
under and in respect of any Revolving Loans and its related Commitment:

 

(i)                                     to
any Person meeting the criteria of clause (i) of the definition of the term of
“Eligible Assignee” upon the giving of notice to Company and Administrative
Agent; and

 

(ii)                                  to
any Person meeting the criteria of clause (ii) of the definition of the term of
“Eligible Assignee” and (x) in the case of assignments of Commitments or Loans
prior to the later of (A) thirty days after the Closing Date and (B) completion
of the general syndication of the Commitments and Loans, consented to by the
Company, such consent not to be unreasonably withheld, and (y) thereafter, in
the case of assignments of Revolving Loans, Revolving Commitments or Tranche A
Term Loans, to any such Person (except in the case of assignments made to GSCP,
LCP or their respective Affiliates), consented to by each of Company and
Administrative Agent (such consent not to be (x) unreasonably withheld or
delayed or, (y) in the case of Company, required at any time an Event of
Default shall have occurred and then be continuing); provided, further
each such assignment pursuant to this Section 10.5(c)(ii) shall be in an
aggregate amount of not less than (A) $5,000,000 (or such lesser amount as may
be agreed to by Company and Administrative Agent or as shall constitute the
aggregate amount of all of the Revolving Commitments and Revolving Loans of the
assigning Lender) with respect to the assignment of the Revolving Commitments,
Revolving Loans and Tranche A Term Loans and (B) $2,000,000 (or such lesser
amount as may be agreed to by Company and Administrative Agent or as shall
constitute the aggregate amount of all of the Tranche B Term Loan, or Tranche C
Term Loan of the assigning Lender) with respect to the assignment of such Term
Loans.

 

(d)                                 Mechanics.  The assigning Lender and the assignee
thereof shall execute and deliver to Administrative Agent an Assignment
Agreement, together with (i) a processing and recordation fee of $500 in the
case of assignments pursuant to Section 10.5(c)(i) or made by or to GSCP or
LCP, and $2,000 in the case of all other assignments (except that only one fee
shall be payable in the case of contemporaneous assignments to Related Funds),
and (ii) such forms, certificates or other evidence, if any, with respect to
United States federal income tax withholding matters as the assignee under such
Assignment Agreement may be required to deliver to Administrative Agent
pursuant to Section 2.20(c).

 

(e)                                  Notice
of Assignment.  Upon its receipt of
a duly executed and completed Assignment Agreement, together with the
processing and recordation fee referred to in Section 10.5(d) (and any forms,
certificates or other evidence required by this Agreement in connection
therewith), Administrative Agent shall record the information contained in such
Assignment Agreement in the Register, shall give prompt notice thereof to
Company and shall maintain a

 

 

copy of such Assignment
Agreement.

 

(f)                                    Representations
and Warranties of Assignee.  Each
Lender, upon execution and delivery hereof or upon executing and delivering an
Assignment Agreement, as the case may be, represents and warrants as of the
Closing Date or as of the applicable Effective Date (as defined in the
applicable Assignment Agreement) that (i) it is an Eligible Assignee; (ii) it
has experience and expertise in the making of or investing in commitments or
loans such as the applicable Commitments or Loans, as the case may be; and
(iii) it will make or invest in, as the case may be, its Commitments or Loans
for its own account in the ordinary course of its business and without a view
to distribution of such Commitments or Loans within the meaning of the
Securities Act or the Exchange Act or other federal securities laws (it being
understood that, subject to the provisions of this Section 10.5, the
disposition of such Commitments or Loans or any interests therein shall at all
times remain within its exclusive control).

 

(g)                                 Effect
of Assignment.  Subject to the terms
and conditions of this Section 10.5, as of the “Effective Date” specified in
the applicable Assignment Agreement: (i) the assignee thereunder shall have the
rights and obligations of a “Lender” hereunder to the extent such rights and
obligations hereunder have been assigned to it pursuant to such Assignment
Agreement and shall thereafter be a party hereto and a “Lender” for all
purposes hereof; (ii) the assigning Lender thereunder shall, to the extent that
rights and obligations hereunder have been assigned thereby pursuant to such
Assignment Agreement, relinquish its rights (other than any rights which
survive the termination hereof under Section 10.7) and be released from its
obligations hereunder (and, in the case of an Assignment Agreement covering all
or the remaining portion of an assigning Lender’s rights and obligations
hereunder, such Lender shall cease to be a party hereto; provided,
anything contained in any of the Credit Documents to the contrary
notwithstanding, (y) Issuing Bank shall continue to have all rights and
obligations thereof with respect to such Letters of Credit until the
cancellation or expiration of such Letters of Credit and the reimbursement of
any amounts drawn thereunder) and (z) such assigning Lender shall continue to
be entitled to the benefit of all indemnities hereunder as specified herein
with respect to matters arising out of the prior involvement of such assigning
Lender as a Lender hereunder; (iii) the Commitments shall be modified to
reflect the Commitment of such assignee and any remaining Commitment of such
assigning Lender, if any; and (iv) if any such assignment occurs after the
issuance of any Note hereunder, the assigning Lender shall, upon the
effectiveness of such assignment or as promptly thereafter as practicable,
surrender its applicable Notes to Administrative Agent for cancellation, and
thereupon Company shall issue and deliver new Notes, if so requested by the
assignee and/or assigning Lender, to such assignee and/or to such assigning
Lender, with appropriate insertions, to reflect the new Revolving Commitments
and/or outstanding Loans of the assignee and/or the assigning Lender.

 

(h)                                 Participations.  Each Lender shall have the right at any time
to sell one or more participations to any Person (other than Holdings, any of
its Subsidiaries or any of its Affiliates or any competitor of any of the
foregoing) in all or any part of its Commitments, Loans or in any other
Obligation.  The holder of any such
participation, other than an Affiliate of the

 

 

Lender granting such
participation, shall not be entitled to require such Lender to take or omit to
take any action hereunder except with respect to any amendment modification or
waiver that would (i) extend the final scheduled maturity of any Loan, Note or
Letter of Credit (unless such Letter of Credit is not extended beyond the
Revolving Commitment Termination Date) in which such participant is
participating, or reduce the rate or extend the time of payment of Interest or
Fees thereon (except in connection with a waiver of applicability of any
post-default increase in interest rates) or reduce the principal amount
thereof, or increase the amount of the participant’s participation over the
amount thereof then in effect (it being understood that a waiver of any Default
or Event of Default or of a mandatory reduction in the Commitment shall not
constitute a change in the terms of such participation, and that an increase in
any Commitment or Loan shall be permitted without the consent of any
participant if the participant’s participation is not increased as a result
thereof), (ii) consent to the assignment or transfer by any Credit Party of any
of its rights and obligations under this Agreement (other than as permitted
under Section 6.9 of this Agreement) or (iii) release all or substantially all
of the Collateral under the Collateral Documents (except as expressly provided
in the Credit Documents) supporting the Loans hereunder in which such
participant is participating.  All
amounts payable by any Credit Party hereunder, including amounts payable to
such Lender pursuant to Section 2.18(c), 2.19 or 2.20, shall be determined as
if such Lender had not sold such participation.  Each Credit Party and each Lender hereby acknowledge and agree
that, solely for purposes of Sections 2.17, (1) any participation will give
rise to a direct obligation of each Credit Party to the participant and (2) the
participant shall be considered to be a “Lender.”

 

(i)                                     Certain
Other Assignments.  In addition to
any other assignment permitted pursuant to this Section 10.5, (i) any Lender may
assign and pledge all or any portion of its Loans, the other Obligations owed
to such Lender, and its Notes, if any, to any Federal Reserve Bank as
collateral security pursuant to Regulation A of the Board of Governors of the
Federal Reserve System and any operating circular issued by such Federal
Reserve Bank, and (ii) with the consent of Administrative Agent any Lender
which is an investment fund may pledge all or any portion of its Notes, if any,
or Loans to its trustee in support of its obligations to such trustee; provided,
no Lender, as between Company and such Lender, shall be relieved of any of its
obligations hereunder as a result of any such assignment and pledge, and provided
further, in no event shall the applicable Federal Reserve Bank or trustee
be considered to be a “Lender” or be entitled to require the assigning Lender
to take or omit to take any action hereunder.

 

10.6.                     Independence of Covenants.  All covenants hereunder shall be given
independent effect so that if a particular action or condition is not permitted
by any of such covenants, the fact that it would be permitted by an exception
to, or would otherwise be within the limitations of, another covenant shall not
avoid the occurrence of a Default or an Event of Default if such action is
taken or condition exists.

 

10.7.                     Survival of Representations,
Warranties and Agreements.
 All representations, warranties
and agreements made herein shall survive the execution and delivery hereof and
the making of any Credit Extension. 
Notwithstanding anything herein or implied by law to the

 

 

contrary, the agreements
of each Credit Party set forth in Sections 2.18(c), 2.19, 2.20, 10.2, and 10.3
and the agreements of Lenders set forth in Sections 2.17, 2.21 and 9.6 shall
survive the payment of the Loans, the cancellation or expiration of the Letters
of Credit and the reimbursement of any amounts drawn thereunder, and the
termination hereof.

 

10.8.                     No Waiver; Remedies Cumulative.  No failure or delay on the part of any Agent
or any Lender in the exercise of any power, right or privilege hereunder or
under any other Credit Document shall impair such power, right or privilege or
be construed to be a waiver of any default or acquiescence therein, nor shall
any single or partial exercise of any such power, right or privilege preclude
other or further exercise thereof or of any other power, right or
privilege.  The rights, powers and
remedies given to each Agent and each Lender hereby are cumulative and shall be
in addition to and independent of all rights, powers and remedies existing by
virtue of any statute or rule of law or in any of the other Credit Documents or
any of the Hedge Agreements.  Any
forbearance or failure to exercise, and any delay in exercising, any right,
power or remedy hereunder shall not impair any such right, power or remedy or
be construed to be a waiver thereof, nor shall it preclude the further exercise
of any such right, power or remedy.

 

10.9.                     Marshalling; Payments Set Aside.  Neither any Agent nor any Lender shall be
under any obligation to marshal any assets in favor of any Credit Party or any
other Person or against or in payment of any or all of the Obligations.  To the extent that any Credit Party makes a
payment or payments to Administrative Agent or Lenders (or to Administrative
Agent, on behalf of Lenders), or Administrative Agent or Lenders enforce any
security interests or exercise their rights of setoff, and such payment or
payments or the proceeds of such enforcement or setoff or any part thereof are
subsequently invalidated, declared to be fraudulent or preferential, set aside
and/or required to be repaid to a trustee, receiver or any other party under
any bankruptcy law, any other state or federal law, common law or any equitable
cause, then, to the extent of such recovery, the obligation or part thereof
originally intended to be satisfied, and all Liens, rights and remedies
therefor or related thereto, shall be revived and continued in full force and
effect as if such payment or payments had not been made or such enforcement or
setoff had not occurred.

 

10.10.              Severability.  In case any provision in or obligation
hereunder or any Note shall be invalid, illegal or unenforceable in any
jurisdiction, the validity, legality and enforceability of the remaining
provisions or obligations, or of such provision or obligation in any other
jurisdiction, shall not in any way be affected or impaired thereby.

 

10.11.              Obligations Several; Independent
Nature of Lenders’ Rights.  The obligations of Lenders hereunder are
several and no Lender shall be responsible for the obligations or Commitment of
any other Lender hereunder.  Nothing
contained herein or in any other Credit Document, and no action taken by
Lenders pursuant hereto or thereto, shall be deemed to constitute Lenders as a
partnership, an association, a joint venture or any other kind of entity. The
amounts payable at any time hereunder to each Lender shall be a separate and
independent debt, and each Lender shall be entitled to protect and enforce its
rights arising out hereof and it shall not be necessary for any other Lender to
be joined as an additional party in any proceeding for such purpose.

 

 

10.12.              Headings.  Section headings herein are included herein
for convenience of reference only and shall not constitute a part hereof for
any other purpose or be given any substantive effect.

 

10.13.              APPLICABLE LAW.  THIS AGREEMENT AND THE RIGHTS AND
OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE GOVERNED BY, AND SHALL BE
CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK
WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES THEREOF.

 

10.14.              CONSENT TO JURISDICTION. 
ALL JUDICIAL PROCEEDINGS BROUGHT AGAINST ANY CREDIT PARTY ARISING OUT OF
OR RELATING HERETO OR ANY OTHER CREDIT DOCUMENT, OR ANY OF THE OBLIGATIONS, MAY
BE BROUGHT IN ANY STATE OR FEDERAL COURT OF COMPETENT JURISDICTION IN THE
STATE, COUNTY AND CITY OF NEW YORK.  BY
EXECUTING AND DELIVERING THIS AGREEMENT, EACH CREDIT PARTY, FOR ITSELF AND IN
CONNECTION WITH ITS PROPERTIES, IRREVOCABLY (a) ACCEPTS GENERALLY AND
UNCONDITIONALLY THE NONEXCLUSIVE JURISDICTION AND VENUE OF SUCH COURTS; (b)
WAIVES ANY DEFENSE OF FORUM NON CONVENIENS; (c) AGREES THAT SERVICE OF ALL
PROCESS IN ANY SUCH PROCEEDING IN ANY SUCH COURT MAY BE MADE BY REGISTERED OR
CERTIFIED MAIL, RETURN RECEIPT REQUESTED, TO THE APPLICABLE CREDIT PARTY AT ITS
ADDRESS PROVIDED IN ACCORDANCE WITH SECTION 10.1; (d) TO THE FULLEST EXTENT
PERMISSIBLE UNDER APPLICABLE LAW, AGREES THAT SERVICE AS PROVIDED IN CLAUSE (c)
ABOVE IS SUFFICIENT TO CONFER PERSONAL JURISDICTION OVER THE APPLICABLE CREDIT
PARTY IN ANY SUCH PROCEEDING IN ANY SUCH COURT, AND OTHERWISE CONSTITUTES
EFFECTIVE AND BINDING SERVICE IN EVERY RESPECT; AND (e) AGREES THAT AGENTS AND
LENDERS RETAIN THE RIGHT TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW
OR TO BRING PROCEEDINGS AGAINST ANY CREDIT PARTY IN THE COURTS OF ANY OTHER
JURISDICTION.

 

10.15.              WAIVER OF JURY TRIAL.  EACH OF THE
PARTIES HERETO HEREBY AGREES TO WAIVE ITS RESPECTIVE RIGHTS TO A JURY TRIAL OF
ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING HEREUNDER OR UNDER ANY OF
THE OTHER CREDIT DOCUMENTS OR ANY DEALINGS BETWEEN THEM RELATING TO THE SUBJECT
MATTER OF THIS LOAN TRANSACTION OR THE LENDER/COMPANY RELATIONSHIP THAT IS
BEING ESTABLISHED.  THE SCOPE OF THIS
WAIVER IS INTENDED TO BE ALL-ENCOMPASSING OF ANY AND ALL DISPUTES THAT MAY BE
FILED IN ANY

 

 

COURT AND THAT RELATE TO THE SUBJECT MATTER OF THIS
TRANSACTION, INCLUDING CONTRACT CLAIMS, TORT CLAIMS, BREACH OF DUTY CLAIMS AND
ALL OTHER COMMON LAW AND STATUTORY CLAIMS. 
EACH PARTY HERETO ACKNOWLEDGES THAT THIS WAIVER IS A MATERIAL INDUCEMENT
FOR LENDERS TO ENTER INTO A BUSINESS RELATIONSHIP, THAT EACH LENDER HAS ALREADY
RELIED ON THIS WAIVER IN ENTERING INTO THIS AGREEMENT, AND THAT EACH LENDER
WILL CONTINUE TO RELY ON THIS WAIVER IN ITS RELATED FUTURE DEALINGS.  EACH PARTY HERETO FURTHER WARRANTS AND
REPRESENTS THAT IT HAS REVIEWED THIS WAIVER WITH ITS LEGAL COUNSEL AND THAT IT
KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS FOLLOWING CONSULTATION
WITH LEGAL COUNSEL.  THIS WAIVER IS
IRREVOCABLE AND THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS,
SUPPLEMENTS OR MODIFICATIONS HERETO OR ANY OF THE OTHER CREDIT DOCUMENTS OR TO
ANY OTHER DOCUMENTS OR AGREEMENTS RELATING TO THE LOANS MADE HEREUNDER.  IN THE EVENT OF LITIGATION, THIS AGREEMENT
MAY BE FILED AS A WRITTEN CONSENT TO A TRIAL BY THE COURT.

 

10.16.              Confidentiality.  Each Agent and each Lender shall hold all
non-public information obtained pursuant to the requirements hereof which has
been identified as confidential by Company in accordance with such Person’s
customary procedures for handling confidential information of this nature and
in accordance with prudent lending or investing practices, it being understood
and agreed by Company that in any event a Lender may make disclosures to
Affiliates of such Lender (and with respect to the initial syndication of the
Loans, to other persons authorized by a Lender or Agent to organize, present or
disseminate such information in connection with disclosures otherwise made in
accordance with this Section 10.16 and thereafter to such Person with the
consent of the Company, such consent not to be unreasonably withheld),
disclosures reasonably required by any bona fide or potential assignee,
transferee or participant (provided, such Person agrees to be bound by
confidentiality provisions substantially similar to this Section 10.16 for the
benefit of the Company) in connection with the contemplated assignment,
transfer or participation by such Lender of any Loans or any participations
therein or by any contractual counterparties (or the professional advisors
thereto) in Hedge Agreements with a Lender or an Affiliate thereof (provided,
such counterparties and advisors are advised of and agree to be bound by the
provisions of this Section 10.16) or disclosures required by any governmental
agency or representative thereof or by the NAIC or pursuant to legal process; provided,
unless specifically prohibited by applicable law or court order, each Lender
shall make reasonable efforts to notify Company of any request by any
governmental agency or representative thereof (other than any such request in
connection with any examination of the financial condition or other routine
examination of such Lender by such governmental agency) for disclosure of any
such non-public information prior to disclosure of such information.

 

 

10.17.              Usury Savings Clause. 
Notwithstanding any other provision herein, the aggregate interest rate
charged with respect to any of the Obligations, including all charges or fees
in connection therewith deemed in the nature of interest under applicable law
shall not exceed the Highest Lawful Rate. 
If the rate of interest (determined without regard to the preceding
sentence) under this Agreement at any time exceeds the Highest Lawful Rate, the
outstanding amount of the Loans made hereunder shall bear interest at the
Highest Lawful Rate until the total amount of interest due hereunder equals the
amount of interest which would have been due hereunder if the stated rates of
interest set forth in this Agreement had at all times been in effect.  In addition, if when the Loans made
hereunder are repaid in full the total interest due hereunder (taking into
account the increase provided for above) is less than the total amount of
interest which would have been due hereunder if the stated rates of interest
set forth in this Agreement had at all times been in effect, then to the extent
permitted by law, Company shall pay to Administrative Agent an amount equal to
the difference between the amount of interest paid and the amount of interest
which would have been paid if the Highest Lawful Rate had at all times been in
effect.  Notwithstanding the foregoing,
it is the intention of Lenders and Company to conform strictly to any
applicable usury laws.  Accordingly, if
any Lender contracts for, charges, or receives any consideration which
constitutes interest in excess of the Highest Lawful Rate, then any such excess
shall be cancelled automatically and, if previously paid, shall at such
Lender’s option be applied to the outstanding amount of the Loans made
hereunder or be refunded to Company.

 

10.18.              Counterparts.  This Agreement may be executed in any number
of counterparts, each of which when so executed and delivered shall be deemed
an original, but all such counterparts together shall constitute but one and
the same instrument.

 

10.19.              Effectiveness.  This Agreement shall become effective
upon the execution of a counterpart hereof by each of the parties hereto and
receipt by Company and Administrative Agent of written or telephonic
notification of such execution and authorization of delivery thereof.

 

[Remainder of page
intentionally left blank]

 

 

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

 

 

	
   

  	
  VOUGHT
  AIRCRAFT INDUSTRIES, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ W. Bruce White, Jr.

  
	
   

  	
  Name:

  	
  Bruce White, Jr.

  
	
   

  	
  Title:

  	
  Corporate
  Secretary

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  VAC
  HOLDINGS II, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ W. Bruce White, Jr.

  
	
   

  	
  Name:

  	
  Bruce White, Jr.

  
	
   

  	
  Title:

  	
  Corporate
  Secretary

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  NORTHROP
  GRUMMAN COMMERCIAL

  AIRCRAFT CORPORATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ W. Bruce White, Jr.

  
	
   

  	
  Name:

  	
  Bruce White, Jr.

  
	
   

  	
  Title:

  	
  Corporate
  Secretary

  
	
   

  	
   

  
	
   

  	
  VAC
  INDUSTRIES, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ W. Bruce White, Jr.

  
	
   

  	
  Name:

  	
  Bruce White, Jr.

  
	
   

  	
  Title:

  	
  Corporate
  Secretary

  
				

 

126

 

	
   

  	
   

  	
   

  	
  GOLDMAN
  SACHS CREDIT PARTNERS L.P.,

  
	
   

  	
   

  	
   

  	
  as Syndication Agent, Joint Arranger, Joint Book

  Manager and a Lender

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  	
  Authorized Signatory

  

 

127

 

	
   

  	
   

  	
  LEHMAN
  COMMERCIAL PAPER INC.,

  
	
   

  	
   

  	
  as Administrative Agent, Collateral Agent, Swing

  
	
   

  	
   

  	
  Line Lender and a Lender

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
   

  	
  Title:

  

 

128

 

 

	
   

  	
   

  	
  LEHMAN BROTHERS INC.,

  
	
   

  	
   

  	
  as Joint Arranger and Joint Book Manager

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
   

  
						

 

129

 

APPENDIX
A-1

TO CREDIT AND GUARANTY AGREEMENT

 

Tranche A Term Loan Commitments

 

	
  Lender

  	
   

  	
  Tranche A

  Term Loan Commitment

  	
   

  	
  Pro

  Rata Share

  	
   

  
	
  Goldman Sachs
  Credit Partners L.P.

  	
   

  	
  $

  	
  105,000,000.00

  	
   

  	
  60.0

  	
  %

  
	
  Lehman
  Commercial Paper Inc.

  	
   

  	
  $

  	
  70,000,000.00

  	
   

  	
  40.0

  	
  %

  
	
  Total

  	
   

  	
  $

  	
  175,000,000.00

  	
   

  	
  100

  	
  %

  

 

130

 

APPENDIX
A-2

TO CREDIT AND GUARANTY AGREEMENT

 

Tranche B Term Loan Commitments

 

	
  Lender

  	
   

  	
  Tranche B

  Term Loan Commitment

  	
   

  	
  Pro

  Rata Share

  	
   

  
	
  Goldman Sachs
  Credit Partners L.P.

  	
   

  	
  $

  	
  120,000,000.00

  	
   

  	
  60.0

  	
  %

  
	
  Lehman
  Commercial Paper Inc.

  	
   

  	
  $

  	
  80,000,000.00

  	
   

  	
  40.0

  	
  %

  
	
  Total

  	
   

  	
  $

  	
  200,000,000.00

  	
   

  	
  100

  	
  %

  

 

131

 

APPENDIX
A-3

TO CREDIT AND GUARANTY AGREEMENT

 

Tranche C Term Loan Commitments

 

	
  Lender

  	
   

  	
  Tranche C

  Term Loan Commitment

  	
   

  	
  Pro

  Rata Share

  	
   

  
	
  Goldman Sachs
  Credit Partners L.P.

  	
   

  	
  $

  	
  90,000,000.00

  	
   

  	
  60.0

  	
  %

  
	
  Lehman
  Commercial Paper Inc.

  	
   

  	
  $

  	
  60,000,000.00

  	
   

  	
  40.0

  	
  %

  
	
  Total

  	
   

  	
  $

  	
  150,000,000.00

  	
   

  	
  100

  	
  %

  

 

132

 

APPENDIX
A-4

TO CREDIT AND GUARANTY AGREEMENT

 

Revolving Credit Commitments

 

	
  Lender

  	
   

  	
  Revolving
  Commitment

  	
   

  	
  Pro Rata
  Share

  	
   

  
	
  Goldman Sachs
  Credit Partners L.P.

  	
   

  	
  $

  	
  75,000,000.00

  	
   

  	
  60.0

  	
  %

  
	
  Lehman
  Commercial Paper Inc.

  	
   

  	
  $

  	
  50,000,000.00

  	
   

  	
  40.0

  	
  %

  
	
  Total

  	
   

  	
  $

  	
  125,000,000.00

  	
   

  	
  100

  	
  %

  

 

133

 

APPENDIX B

TO CREDIT AND GUARANTY AGREEMENT

 

Notice Addresses

 

THE CARLYLE GROUP

1001 Pennsylvania Avenue, N.W.

Washington, D.C. 20004

Attention: Allan Holt

Telephone: 202-347-2626

Facsimile: 202-347-9250

 

with a copy to:

Latham & Watkins

885 Third Avenue, Suite 1000

New York, New York 10022-4802

Attention: R. Ronald Hopkinson

Telephone: 212-906-1200

Facsimile: 212-751-4864

 

 

VOUGHT AIRCRAFT INDUSTRIES, INC.

9314 West Jefferson Avenue

Dallas, Texas 75211

Attention: William McMillan

Facsimile: 972-946-5683

 

134

 

GOLDMAN SACHS CREDIT PARTNERS L.P.

as Syndication Agent, Joint Arranger, Joint Book Manager and a Lender

 

Goldman, Sachs & Co.

85 Broad Street, 6th Floor

New York, NY 10004

Attention: 
Sandra Stulberger

Facsimile: 
212-357-4597

 

135

 

LEHMAN COMMERCIAL PAPER INC.

as Administrative Agent, Swing Line Lender and a Lender

 

Lehman Brothers Inc.

3 World Financial Center, 11th Floor

New York, New York 10285

Attention: Andrew Keith

Telephone: 212-526-7000

Facsimile: 212-526-0242

 

136

 

LEHMAN BROTHERS INC.

as Joint Arranger and Joint Book Manager

 

Lehman Brothers Inc.

3 World Financial Center, 11th Floor

New York, New York 10285

Attention: Andrew Keith

Telephone: 212-526-7000

Facsimile: 212-526-0242

 

137

 

SCHEDULE 3.1(i)

 

Fee
Mortgage Properties:

 

Northrop Avenue One

Hawthorne, CA 90250

 

West Highway 22

Milledgeville, GA 31061

 

Jefferson Ave.

9314 W.,

Dallas, TX 75211

 

also known as:

 

Marshall Dr.

1701 W.

Grand Prairie, TX 75211

 

138

 

SCHEDULE
5.14(a)

 

Leasehold
Mortgage Properties:

 

Marshall Street

1701 W. Marshall

Grand Prarie, TX

 

NWIRP Facility

9314 West Jefferson

Dallas, TX

 

Witham Field

1801 S.E. Airport Road

Stuart, FL

 

Office Buildings

1801 S.E. Airport Road

Stuart, FL

 

Georgia Production Site

One Northrop Place

Perry, GA

 

139

 

VOUGHT
AIRCRAFT INDUSTRIES, INC.

 

SIXTH
AMENDMENT TO

CREDIT
AND GUARANTY AGREEMENT

 

This SIXTH AMENDMENT,
dated as of July 2, 2003 (this “Amendment”),
to the Credit and Guaranty Agreement, dated as of July 24, 2000 (as amended
through the date hereof, the “Credit
Agreement”), by and among VOUGHT
AIRCRAFT INDUSTRIES, INC., a Delaware Corporation (“Company”), CERTAIN SUBSIDIARIES OF COMPANY, as Guarantors, CERTAIN FINANCIAL INSTITUTIONS, as Lenders, LEHMAN COMMERCIAL PAPER INC. (“LCPI”), as Administrative Agent (in such
capacity, “Administrative Agent”)
and as Collateral Agent, GOLDMAN SACHS CREDIT
PARTNERS L.P. (“GSCP”),
as Syndication Agent (in such capacity, “Syndication
Agent”), and GSCP and LEHMAN
BROTHERS INC. (“LBI”),
as Joint Arrangers and Joint Book Managers (together with GSCP in such
capacities, the “Arrangers”).  Capitalized terms used herein not otherwise
defined herein or otherwise amended hereby shall have the meanings ascribed
thereto in the Credit Agreement.

 

RECITALS:

 

WHEREAS, Company,
the Agents and the Lenders party hereto have agreed to amend the Credit
Agreement, subject to the terms and conditions set forth herein, to (i) extend
additional Revolving Commitments to Company in an aggregate principal amount of
$60,000,000 (the “New Revolving Commitments”),
the proceeds of which will be used by Company pursuant to Section 2.6 of the
Credit Agreement, (ii) permit Company to merge with The Aerostructures
Corporation, a Delaware corporation and/or TA Acquisition Holdings, Inc., a
Delaware Corporation, with Company being the surviving corporation and (iii)
make certain other modifications.

 

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

 

SECTION 1.                                                    AMENDMENTS
TO CREDIT AGREEMENT

 

1.1                               Amendments
to Section 1: Definitions.

 

A.                                   Section 1.1 of the Credit Agreement
is hereby amended by adding thereto the following definitions in proper
alphabetical order:

 

1

 

“Aerostructures
Corp.”
means collectively, TA Acquisition Holdings, Inc., a Delaware Corporation and
The Aerostructures Corporation, a Delaware corporation.

 

“Aerostructures
Merger” means the merger of The Aerostructures Corporation
and/or TA Acquisition Holdings, Inc. with and into Company pursuant to the
terms and conditions of the Aerostructures Merger Agreement.

 

“Aerostructures
Merger Agreement” means that certain Agreement and Plan of
Merger dated as of May 12, 2003 by and among Company, TA Acquisition Holdings,
Inc. and The Aerostructures Corporation, as such agreement may hereafter be
amended, restated, supplemented or otherwise modified from to time to time to
the extent permitted pursuant to Section 6.18.

 

“Aerostructures
Transaction Costs” means the fees, costs and expenses payable
by Company or any of Company’s Subsidiaries in connection with the transactions
contemplated by the Sixth Amendment, the Senior Note Indenture and the
Aerostructures Merger Agreement, in an aggregate amount not to exceed
$75,000,000.

 

“Passive
Investor” means a mutual fund or other entity that invests in
corporations and/or other companies to the extent that any such fund or entity
is not engaged in the active management of any such corporation or company, provided
that, if such fund or entity has not made prior investments, such fund or
entity shall be deemed engaged in such active management to the extent its
parent company is so engaged.

 

“Senior
Notes” means the $270,000,000 in aggregate principal amount
of 8% senior notes, as such notes may hereafter be amended, restated,
supplemented or otherwise modified from time to time to the extent permitted
pursuant to Section 6.18.

 

“Senior
Notes Indenture” means that certain Indenture dated as of
July 2, 2003 between Company and Wells Fargo Minnesota, as trustee, pursuant to
which the Senior Notes are issued, as in effect on the Sixth Amendment Closing
Date and as such indenture may hereafter be amended, restated, supplemented or
otherwise modified from time to time to the extent permitted under Section
6.18.

 

“Sixth
Amendment” means the Sixth Amendment dated July 2, 2003 to
this Agreement by and among Company, the Lenders party to the Sixth Amendment
and the Agents.

 

“Sixth
Amendment Closing Date” has the meaning assigned to that term
in the Sixth Amendment.

 

2

 

“Sixth
Amendment Closing Date Certificate” means a Sixth Amendment
Closing Date Certificate substantially in the form of Exhibit B to the Sixth
Amendment.

 

B.                                     Section 1.1 of the Credit Agreement
is hereby amended by deleting each of the definitions of  “Change of Control,” “Consolidated Excess
Cash Flow”, “Lender”, “Restricted Junior Payment” and “Revolving Commitments”
in their entirety and substituting therefore the following:

 

“Change of Control” means, at any time, (i)
(a) prior to consummation of an initial public offering by Company, Sponsor and
its Affiliates and other Permitted Investors shall cease to beneficially own
and control at least 51% on a fully diluted basis of the economic and voting
interests in the Capital Stock of Company; or (b) after the consummation of any
initial public offering, any Person or “group” (within the meaning of Rules
13d-3 and 13d-5 under the Exchange Act) (collectively, an “Other Investor”) has beneficial ownership
(within the meaning of Rule 13d-3 of the Exchange Act) of a percentage of
voting interests in the Company’s Capital Stock that is greater than the
percentage of such voting interests at such time beneficially owned by Sponsor,
its Affiliates and the other Permitted Investors; provided, that this
clause (b) shall not be applicable if the Other Investor is a Passive Investor
that holds beneficial ownership of less than 20% of such voting interests; (ii)
Sponsor, its Affiliates and other Permitted Investors shall cease to have the
power (whether or not exercised) to elect a majority of the members of the board
of directors (or similar governing body) of Company; or (iii) a “change of
control” under the Senior Notes Indenture shall occur.

 

“Consolidated Excess Cash Flow” means, for
any period, an amount (if positive) equal to: (i) Consolidated Adjusted EBITDA,
minus (ii) the sum, without duplication, of the amounts for such period
of (a) voluntary and scheduled repayments of Consolidated Total Debt (excluding
repayments of Revolving Loans or Swing Line Loans except to the extent the
Revolving Commitments are permanently reduced in connection with such
repayments), (b) Consolidated Capital Expenditures (net of any proceeds of any
related financings with respect to such expenditures), (c) Consolidated
Interest Expense, (d) the provision for current taxes based on income of
Company and its Subsidiaries and payable in cash with respect to such period,
(e) cash payments made in connection with Permitted Acquisitions and Permitted
Investments not in excess of $15,000,000 in the aggregate in any Fiscal Year
(net of any proceeds with respect to any related financing), (f) unusual or
non-recurring charges to the extent such charges are included in the
calculation of Consolidated Adjusted EBITDA, and (g) the Aerostructures
Transaction Costs.

 

“Lender”
means (i) each financial institution listed on the signature pages hereto as a
Lender, (ii) each Tranche X Term Loan Lender listed on the signature pages to
the Third Amendment as a Tranche X Term Loan Lender, (iii) each new Lender of

 

3

 

Revolving Loans listed on the signature pages to the
Sixth Amendment as a Lender and (iv) any other Person that becomes a party
hereto pursuant to an Assignment Agreement.

 

“Restricted
Junior Payment” means (i) any dividend or other distribution
(other than to Company or any of its Subsidiaries), direct or indirect, on
account of any shares of any class of stock of Company or any of its
Subsidiaries now or hereafter outstanding, except a dividend payable solely in
shares of that class of stock to the holders of that class; (ii) any
redemption, retirement, sinking fund or similar payment, purchase or other
acquisition for value, direct or indirect, (other than to Company or any of its
Subsidiaries) of any shares of any class of stock of Company or any of its
Subsidiaries now or hereafter outstanding; (iii) any payment (other than to
Company or any of its Subsidiaries) made to retire, or to obtain the surrender
of, any outstanding warrants, options or other rights to acquire shares of any
class of stock of Company or any of its Subsidiaries now or hereafter
outstanding; (iv) any management or advisory fees paid by a Credit Party to
Sponsor or its Affiliates after the Closing Date, and (v) any payment or
prepayment of principal of, premium, if any, or interest on, or redemption,
purchase, retirement, defeasance (including in-substance or legal defeasance),
sinking fund or similar payment with respect to, the Senior Notes.

 

“Revolving
Commitment” means the commitment of a Lender to make or
otherwise fund any Revolving Loan and to acquire participations in Letters of
Credit and Swing Line Loans hereunder and “Revolving
Commitments” means such commitments of all Lenders in the
aggregate.  The aggregate amount of the
Revolving Commitments as of the Sixth Amendment Closing Date is $150,000,000.

 

1.2                               Amendments
to Section 2: Loans.

 

A.                                   Subsection 2.2 is hereby amended by
deleting clause (a) in its entirety and replacing it with a new clause (a) as
follows:

 

“                                          (a)                                  Revolving Commitments. 
During the Revolving Commitment Period, subject to the terms and
conditions hereof, each Lender severally agrees to make Revolving Loans to
Company in the aggregate amount up to but not exceeding such Lender’s Revolving
Commitment; provided, after giving effect to the making of any Revolving
Loans in no event shall the Total Utilization of Revolving Commitments exceed
the Revolving Commitments then in effect. 
Amounts borrowed pursuant to this Section 2.2(a) may be repaid and
reborrowed during the Revolving Commitment Period; provided  further,
in no event shall outstanding Revolving Loans plus the aggregate
principal amount of outstanding Swing Line Loans exceed $150,000,000 at any
time.  Each Lender’s Revolving
Commitment shall expire on the Revolving Commitment Termination Date and all
Revolving Loans and all other amounts owed hereunder with respect to the
Revolving Loans and the Revolving Commitments shall be paid in full no later
than such date.”

 

4

 

B.                                     Subsection 2.3 is hereby amended by
deleting clause (a) in its entirety and replacing it with a new clause (a) as
follows:

 

“                                          (b)                                 Swing Line Loans Commitments. 
During the Revolving Commitment Period, subject to the terms and
conditions hereof, Swing Line Lender hereby agrees to make Swing Line Loans to
Company in the aggregate amount up to but not exceeding the Swing Line
Sublimit; provided, after giving effect to the making of any Swing Line
Loan, in no event shall the Total Utilization of Revolving Commitments exceed
the Revolving Commitments then in effect; provided  further, in no
event shall the aggregate principal amount of outstanding Revolving Loans plus
the outstanding principal amount of Swing Line Loans exceed $150,000,000 at any
time.  Amounts borrowed pursuant to this
Section 2.3 may be repaid and reborrowed during the Revolving Commitment
Period.  Swing Line Lender’s Revolving
Commitment shall expire on the Revolving Commitment Termination Date and all
Swing Line Loans and all other amounts owed hereunder with respect to the Swing
Line Loans and the Revolving Commitments shall be paid in full no later than
such date.”

 

C.                                     Subsection 2.4 is hereby amended by
adding the following paragraph at the conclusion thereof as follows:

 

“                                          On and after the Sixth Amendment
Closing Date, the Letters of Credit listed on Schedule 1 to the Sixth Amendment
(the “Aerostructures Letters of Credit”)
together with any Risk Participation Agreements entered into in connection
therewith shall be deemed to have been issued by the applicable Issuing Bank
pursuant to the terms of this Agreement and shall constitute a Letter of Credit
for all purposes hereof and under this Agreement and the other Credit
Documents.  Company agrees that it shall
be liable with respect to any reimbursement required to made in respect of the
Aerostructures Letters of Credit in accordance with Section 2.4(d) and other
provisions of this Agreement.”

 

1.3                               Amendments
to Section 4:  Representations and
Warranties.

 

A.                                   Subsection 4.9 of the Credit
Agreement is hereby amended by deleting such subsection in its entirety and
replacing it with the following:

 

“                                          4.9.                            No Material Adverse
Change.  (i) With respect to Company
and its Subsidiaries (other than Aerostructures Corp.), since March 31, 2000
and (ii) with respect to Company and its Subsidiaries (including Aerostructures
Corp.), since December 28, 2001, no event or change has occurred that has
caused or evidences, a Material Adverse Effect.”

 

B.                                     Subsection 4.19 of the Credit
Agreement is hereby amended by deleting such subsection in its entirety and
replacing it with the following:

 

“                                          4.19.                     Employee
Benefit Plans.  The Company, each of
its Subsidiaries and each of their respective ERISA Affiliates are in
compliance with all applicable provisions

 

5

 

and requirements of ERISA and the Internal Revenue
Code and the regulations and published interpretations thereunder with respect
to each Employee Benefit Plan, and has performed all their obligations under
each Employee Benefit Plan, except where such non-compliance or failure to
perform would not reasonably be expected to have a Material Adverse
Effect.  Each Employee Benefit Plan
which is intended to qualify under Section 401(a) of the Internal Revenue Code
has been determined by the Internal Revenue Service to be so qualified or the
Company, any of its Subsidiaries or their respective ERISA Affiliates, as
applicable, shall timely make all filings necessary to obtain such
qualification.  No material liability to
the PBGC (other than required premium payments which have been timely paid when
due), the Internal Revenue Service, any Employee Benefit Plan or any Trust
established under Title IV of ERISA has been or is expected to be incurred by
the Company, any of its Subsidiaries or any of its ERISA Affiliates.  No ERISA Event has occurred or is reasonably
expected to occur.  Except for benefits
(i) referred to in the Aerostructures Merger Agreement and (ii) required pursuant
to the terms of the Employee Matters Agreement entered into as of June 9, 2000
by and between Seller and the Company (formerly known as VAC Acquisition Corp.
II) (such benefits referred to as “Retiree
Medical Benefits”) or to the extent required under Section 4980B of
the Internal Revenue Code or similar state laws, no Employee Benefit Plan
provides health or welfare benefits (through the purchase of insurance or
otherwise) for any retired or former employee of the Company, any of its
Subsidiaries or any of its ERISA Affiliates. 
As of December 31,
2002, the estimated liabilities of the Retiree Medical Benefits is $515,200,000.  As of the most recent valuation date for any Pension Plan, the
amount of unfunded benefit liabilities as defined in Section 4001(a)(18) of
ERISA, in the aggregate for all Pension Plans, does not exceed an amount that
could reasonably be expected to have a Material Adverse Effect.  Neither Company, any of its Subsidiaries or
any ERISA Affiliate has any liability for any unpaid contribution with respect
to any Pension Plan.  Each of the
Company, its Subsidiaries or any ERISA Affiliate has made all required
contributions under each Pension Plan for all periods or proper accruals have
been made and reflected on the appropriate balance sheet and books and
records.  As of the most recent
valuation date for each Multiemployer Plan for which the actuarial report is
available, the potential liability of the Company, its Subsidiaries and its
ERISA Affiliates for a complete withdrawal from such Multiemployer Plan (within
the meaning of Section 4203 of ERISA), when aggregated with such potential
liability for a complete withdrawal from all Multiemployer Plans, based on
information available pursuant to Section 4221(e) of ERISA, does not exceed
$10,000,000.  The Company, each of its
Subsidiaries and each of its ERISA Affiliates have complied in all material
respects with the requirements of Section 515 of ERISA with respect to each
Multiemployer Plan and are not in material “default” (as defined in Section
4219(c)(5) of ERISA) with respect to payments to a Multiemployer Plan.”

 

6

 

1.4                               Amendments
to Section 5.1: Financial Statements and Other Reports.

 

A.                                   Subsection 5.1 is hereby amended by
deleting clause (b) in its entirety and replacing it with the following:

 

“                                                                                          (b)                                 Quarterly Financial Statements. As soon as available, and in any
event within forty-five (45) days after the end of each Fiscal Quarter of each
Fiscal Year, the consolidated balance sheets of Company and its Subsidiaries as
at the end of such Fiscal Quarter and the related consolidated statements of
income, stockholders’ equity and cash flows of Company and its Subsidiaries for
such Fiscal Quarter and for the period from the beginning of the then current
Fiscal Year to the end of such Fiscal Quarter, setting forth in each case in
comparative form the corresponding figures for the corresponding periods of the
previous Fiscal Year, all in reasonable detail, together with a Financial
Officer Certification; provided, that the foregoing requirements of this
Section 5.1(b) shall be deemed satisfied by delivery of Company’s Form 10-Q;”

 

B.                                     Subsection 5.1 is hereby further
amended by deleting clause (c) in its entirety and replacing it with the
following:

 

“                                                                                          (c)                                  Annual Financial Statements. 
As soon as available, and in any event within one hundred twenty (120)
days after the end of each Fiscal Year, (i) the consolidated balance sheets of
Company and its Subsidiaries as at the end of such Fiscal Year and the related
consolidated statements of income, stockholders’ equity and cash flows of
Company and its Subsidiaries for such Fiscal Year, setting forth in each case
in comparative form the corresponding figures for the previous Fiscal Year, in
reasonable detail, together with a Financial Officer Certification and a
Narrative Report with respect thereto; and (ii) with respect to such
consolidated financial statements a report thereon of one of the five largest
certified public accountants in the United States or other independent
certified public accountants of recognized national standing selected by
Company, and reasonably satisfactory to Administrative Agent (which report
shall have no disclosure as to going concern and which shall state that such
consolidated financial statements fairly present, in all material respects, the
consolidated financial position of Company and its Subsidiaries as at the dates
indicated and the results of their operations and their cash flows for the
periods indicated in conformity with GAAP (except as otherwise disclosed in
such financial statements) and that the examination by such accountants in
connection with such consolidated financial statements has been made in
accordance with generally accepted auditing standards) together with a written
statement by such independent certified public accountants stating (1) that
their audit examination has included a review of the terms of the Credit
Documents, (2) that in making the examination nothing came to their attention
that caused them to believe that Company was not in compliance with Section
6.8, and (3) that nothing has come to their attention that causes them to
believe that the information contained in any Compliance Certificate is not
correct or that the matters set forth in such Compliance Certificate are not
stated in accordance with the terms hereof; provided, that the foregoing
requirements of this Section 5.1(c) shall be deemed satisfied by delivery of
Company’s Form 10-K within

 

7

 

ninety (90) days after the end of each Fiscal
Year, to the extent the required information set forth above is included
therein;”

 

C.                                     Subsection 5.1 of the hereby further
amended by deleting clause (h) in its entirety and replacing it with the
following:

 

“                                                                                          (h)                                 ERISA. 
(i) Promptly upon becoming aware of the occurrence of or forthcoming
occurrence of any ERISA Event, a written notice specifying the nature thereof,
what action the Company, any of its Subsidiaries or any of their respective
ERISA Affiliates has taken, is taking or proposes to take with respect thereto
and, when known, any action taken or threatened by the Internal Revenue
Service, the Department of Labor or the PBGC with respect thereto; and (ii)
upon the request of the Administrative Agent, with reasonable promptness,
copies of (1) the most recent actuarial report prepared with respect to each
Employee Benefit Plan; (2) each Schedule B (Actuarial Information) to the
annual report (Form 5500 Series) filed by the Company, any of its Subsidiaries
or any of their respective ERISA Affiliates with the Internal Revenue Service
with respect to each Pension Plan; (3) all notices received by the Company, any
of its Subsidiaries or any of their respective ERISA Affiliates from a
Multiemployer Plan sponsor concerning an ERISA Event; and (4) copies of such
other documents or governmental reports or filings relating to any Employee
Benefit Plan as Administrative Agent shall reasonably request;”

 

1.5                               Amendments
to Section 6.1: Indebtedness.

 

A.                                   Subsection 6.1 is hereby amended by
deleting clause (c) in its entirety and replacing it with the following:

 

“                                          (c)                                  Indebtedness incurred by Company and
guaranties of such Indebtedness by Company’s Subsidiaries with respect to (i)
the Senior Notes and (ii) other Indebtedness incurred to refinance, in whole or
in part, Indebtedness under the Senior Notes if the terms and conditions
thereof are not less favorable, taken as a whole, to the obligor thereon or to
the Lenders than the Indebtedness being refinanced and the average life to
maturity thereof is greater than or equal to that of the Indebtedness being
refinanced; provided, such Indebtedness permitted under the immediately
preceding clause (ii) above shall (A) not include Indebtedness of an obligor
that was not an obligor with respect to the Indebtedness being refinanced, (B)
not exceed in principal amount (or accreted value, in the case of any such
refinancing Indebtedness issued with a discount) of the Indebtedness (including
the amount of interest and principal (and premium, if any)) being refinanced
plus the amount of customary underwriting discounts, financing fees and
commissions and other reasonable costs and expenses associated with the
issuance thereof, and (C) not be incurred, created or assumed if any Default or
Event of Default has occurred and is continuing or would result therefrom;”

 

8

 

B.                                     Subsection 6.1 is hereby further
amended by deleting clause (k) in its entirety and replacing it with the
following:

 

“                                          (k)                                  Indebtedness with respect to Capital
Leases in an aggregate amount not to exceed at any time $15,000,000;”

 

C.                                     Subsection 6.1 is hereby further
amended by deleting clauses (m) and (n) in their entirety and replacing them
with the following:

 

“                                          (m)                               purchase money Indebtedness incurred
by Company or its Subsidiaries in an aggregate amount not to exceed at any time
$20,000,000 (less the amount of Indebtedness outstanding under Subsection
6.1(k) above); provided, any such Indebtedness shall be secured only to
the asset acquired in connection with the incurrence of such Indebtedness or
proceeds thereof; and

 

(n)                                 other unsecured Indebtedness of
Company and its Subsidiaries, in an aggregate amount not to exceed at any time
$20,000,000.”

 

1.6                               Amendments
to Section 6.2: Liens. 
Subsection 6.2 is hereby amended by 
(i) deleting the word “and” at the conclusion of subsection 6.2(n); (ii)
deleting the “.” at the conclusion of subsection 6.2(o) and replacing it with
“; and”; and (iii) the addition of a new clause (p) at the conclusion thereof
as follows:

 

“                                          (p)                                 other
Liens on assets other than the Collateral securing Indebtedness in an aggregate
principal amount not to exceed $2,500,000 at any time outstanding.”

 

1.7                               Amendments to
Section 6.4: No Further Negative Pledges. 
Subsection 6.4 is hereby amended by deleting it in its entirety
and replacing it with the following:

 

“                                                                                          6.4.  No
Further Negative Pledges. 
Except with respect to (a) specific property encumbered to secure
payment of particular Indebtedness or to be sold pursuant to an executed
agreement with respect to a permitted Asset Sale, (b) restrictions contained in
the Senior Notes Indenture and (c) restrictions by reason of customary
provisions contained in leases, licenses, government contracts and similar
agreements entered into in the ordinary course of business (provided
that such restrictions are limited to the property or assets secured by such
Liens or the property or assets subject to such leases, licenses or similar
agreements, as the case may be) no Credit Party nor any of its Subsidiaries
shall enter into any agreement prohibiting the creation or assumption of any
Lien upon any of its properties or assets, whether now owned or hereafter
acquired.”

 

1.8                               Amendments
to Section 6.5: Restricted Junior Payments.

 

Subsection 6.5 is hereby amended by deleting
it in its entirety and replacing it with the following:

 

9

 

“                                                                                          6.5.  Restricted Junior Payments. 
No Credit Party shall, nor shall it permit any of its Subsidiaries to,
directly or indirectly, declare, order, pay, make or set apart any sum for any
Restricted Junior Payment except that (a) Company may make Restricted Junior Payments to make payments in
accordance with the terms of the Management Agreement; (b) Company may make Restricted
Junior Payments in an aggregate amount not to exceed $3,500,000 in any Fiscal
Year to the extent necessary to make repurchases of Securities (and options or
warrants to purchase such Securities) of Company from employees (i) upon
termination (including by reason of death, disability or retirement) of such
employees or (ii) pursuant to a contractual obligation of Company;
(c) Company may make Restricted Junior Payments to the extent necessary to
accomplish the payment of the Transaction Costs; (d) Company may make
Restricted Junior Payments and any Subsidiary of Company may make Restricted
Junior Payments to Company to the extent necessary to (i) make payments of
interest when due in respect of the Senior Notes, (ii) pay fees, costs,
expenses, indemnification, liquidated damages and similar or customary
obligations in connection with the Senior Notes and (iii) make a voluntary
prepayment (including any prepayment premium in connection therewith) in order
to permit any Indebtedness incurred by Company in order to refinance the Senior
Notes pursuant to Section 6.1(c)(ii), so long as no Default or Event of Default
shall have occurred and be continuing or be caused thereby; and (e) Company may
make Restricted Junior Payments to the extent necessary to accomplish the
payment of the Aerostructures Transaction Costs.”

 

1.9                               Amendments
to Section 6.6:   Restrictions on Subsidiary Distributions.

 

Subsection 6.6 is hereby amended by deleting
such subsection in its entirety and replacing it with the following:

 

“                                          6.6.                            Restrictions on Subsidiary
Distributions.  Except as provided herein, no Credit Party
shall, nor shall it permit any of its Subsidiaries to, create or otherwise
cause any consensual encumbrance or restriction of any kind on the ability of
any Subsidiary of Company to (a) pay dividends or make any other distributions
on any of such Subsidiary’s Capital Stock owned by Company or any other
Subsidiary of Company, (b) repay or prepay any Indebtedness owed by such
Subsidiary to Company or any other Subsidiary of Company, (c) make loans or
advances to Company or any other Subsidiary of Company, or (d) transfer any of
its property or assets to Company or any other Subsidiary of Company other than
restrictions (i) in agreements evidencing Indebtedness permitted by Sections
6.1(c), 6.1(f) and 6.1(l) that impose restrictions on the property so acquired
and proceeds thereof and (ii) by reason of customary provisions contained in
leases, licenses, joint venture agreements and similar agreements entered into
in the ordinary course of business, and (iii) that are or were created by
virtue of any transfer of, agreement to transfer or option or right with
respect to any property, assets or Capital Stock not otherwise prohibited under
this Agreement.”

 

10

 

1.10                        Amendments
to Section 6.7:  Investments.

 

Subsection
6.7 is hereby amended by (i) deleting the word “and” at the conclusion of
subsection 6.7(k); (ii) deleting the “.” at the conclusion of subsection 6.7(l)
and replacing it with “; and”; and (iii) the addition of a new clause (m) at
the conclusion thereof as follows:

 

“                                                                                          (m)                               Investments made in connection with
the Aerostructures Merger permitted pursuant to Section 6.9.”

 

1.11                        Amendments
to Section 6.8:  Financial Covenants.

 

A.                                   Subsection 6.8(c) is hereby amended
by deleting such subsection in its entirety and replacing it with the
following:

 

“                                                                                          (c)                                  Leverage Ratio. 
Company shall not permit the Leverage Ratio as of the last day of any
Fiscal Quarter, beginning with the Fiscal Quarter ending June 30, 2003 to
exceed the correlative ratio indicated:

 

	
  Fiscal Quarter

  	
   

  	
  Leverage Ratio

  	
   

  
	
  June 30, 2003

  	
   

  	
  3.75: 1.00

  	
   

  
	
  September 30, 2003

  	
   

  	
  3.75: 1.00

  	
   

  
	
  December 31, 2003

  	
   

  	
  3.75: 1.00

  	
   

  
	
  March 31, 2004

  	
   

  	
  3.75: 1.00

  	
   

  
	
  June 30, 2004

  	
   

  	
  3.75: 1.00

  	
   

  
	
  September 30, 2004

  	
   

  	
  3.75: 1.00

  	
   

  
	
  December 31, 2004

  	
   

  	
  3.75: 1.00

  	
   

  
	
  March 31, 2005

  	
   

  	
  3.50: 1.00

  	
   

  
	
  June 30, 2005

  	
   

  	
  3.50: 1.00

  	
   

  
	
  September 30, 2005

  	
   

  	
  3.25: 1.00

  	
   

  
	
  December 31, 2005

  	
   

  	
  3.25: 1.00

  	
   

  
	
  March 31, 2006 And thereafter

  	
   

  	
  3.00: 1.00”

  	
   

  

 

11

 

B.                                     Subsection
6.8(e) is hereby amended by deleting such subsection in its entirety and
replacing it with the following:

 

“                                                                                          (e)                                  Certain Calculations. 
With respect to any period during which a Permitted Acquisition, the
Aerostructures Merger or an Asset Sale has occurred (each, a “Subject Transaction”), for purposes of determining
compliance with the financial covenants set forth in this Section 6.8,
Consolidated Adjusted EBITDA and the components of Consolidated Fixed Charges
shall be calculated with respect to such period on a pro forma basis (including
pro forma adjustments arising out of events which are directly attributable to
a specific transaction, are factually supportable and are expected to have a
continuing impact, in each case determined on a basis consistent with Article
11 of Regulation S-X promulgated under the Securities Act and as interpreted by
the staff of the Securities and Exchange Commission, which would include cost savings
resulting from head count reduction, closure of facilities and similar
restructuring charges, which pro forma adjustments shall be certified by the
chief financial officer of Company) using the historical audited financial
statements of any business so acquired or to be acquired or sold or to be sold
and the consolidated financial statements of Company and its Subsidiaries which
shall be reformulated as if such Subject Transaction, and any Indebtedness
incurred or repaid in connection therewith, had been consummated or incurred or
repaid at the beginning of such period (and assuming that such Indebtedness
bears interest during any portion of the applicable measurement period prior to
the relevant acquisition at the weighted average of the interest rates
applicable to outstanding Loans incurred during such period).”

 

1.12                        Amendments
to Section 6.9: Fundamental Changes;
Disposition of Assets; Acquisitions.

 

Subsection
6.9 is hereby amended by (i) deleting the word “and” at the conclusion of
subsection 6.9(d); (ii) deleting the “.” at the conclusion of subsection 6.9(e)
and replacing it with “;”  and (iii) the
addition of a new clause (f) and (g) at the conclusion thereof as follows:

 

“                                                                                          (f)                                  the Aerostructures Merger; and

 

(g)                                 so long as no Default or Event of
Default has occurred and is continuing or shall be caused thereby, Company and
its Subsidiaries may make Asset Sales with respect to one or more of its
facilities; provided, that (i) with respect to such Asset Sales (A) that
occur on or prior to the two year anniversary of the Sixth Amendment Closing
Date or (B) with respect to which Company or any of its Subsidiaries have
entered into binding agreements (subject only to customary closing conditions)
prior to the two year anniversary of the Sixth Amendment Closing Date and in
any event are scheduled to close no later than one hundred eighty (180) days
following the two year anniversary of the Sixth Amendment Closing Date, prior
to consummating

 

12

 

such Asset Sales Company shall deliver to the
Administrative Agent an officer’s certificate demonstrating pro forma
compliance with the Leverage Ratio for the next succeeding Fiscal Quarter, as
set forth in Section 6.8(c); (ii) with respect to all such Asset Sales other
than those set forth in (i)(A) and (i)(B) above, such Asset Sales shall be
subject to the consent of Requisite Lenders; and (iii) Company shall apply the
Net Asset Sale Proceeds of such Asset Sales in accordance with Section 2.14(a).”

 

1.13                        Amendments
to Section 6.11:  Sales and Leasebacks. 
Subsection 6.11 of the Credit Agreement is hereby amended by adding the
following paragraph at the conclusion thereof:

 

“                                          Notwithstanding
any of the foregoing to the contrary, so long as no Default or Event of Default
has occurred and is continuing or shall be caused thereby, Company and its
Subsidiaries may sell and leaseback all or a portion of any of its facilities; provided,
that (i) with respect to such sale and leasebacks (A) that occur on or prior to
the two year anniversary of the Sixth Amendment Closing Date or (B) with
respect to which Company or any of its Subsidiaries have entered into binding
agreements (subject only to customary closing conditions) prior to the two year
anniversary of the Sixth Amendment Closing Date and in any event are scheduled
to close no later than one hundred eighty (180) days following the two year
anniversary of the Sixth Amendment Closing Date, prior to consummating such
sale and leasebacks Company shall deliver to the Administrative Agent an
officer’s certificate demonstrating pro forma compliance with the Leverage
Ratio for the next succeeding Fiscal Quarter, as set forth in Section 6.8(c);
(ii) with respect to all such sale and leasebacks other than those set forth in
(i)(A) and (i)(B) above, such sale and leasebacks shall be subject to the
consent of Requisite Lenders; and (iii) Company shall apply the Net Asset Sale
Proceeds of such sale and leasebacks in accordance with Section 2.14(a).”

 

1.14                        Amendments
to Section 6.12:  Transactions with
Shareholders and Affiliates.

 

Subsection
6.12 is hereby amended by adding the following paragraph at the conclusion
thereof as follows:

 

“                                          Notwithstanding any of the foregoing
to the contrary, the foregoing restriction shall not apply to the
Aerostructures Merger and any payments made by Company and its Subsidiaries in
connection with the Aerostructures Transaction Costs.”

 

13

 

1.15                        Amendments
to Section 6:  Amendments to
Aerostructures Merger Agreement and Senior Notes.

 

Section
6 is hereby amended by adding a new Section 6.18 at the conclusion thereof as
follows:

 

“                                          6.18. 
Amendments of Aerostructures Merger
Agreement; Amendments or Waivers with respect to Senior Notes.  No Credit Party shall, nor shall it permit
any of its Subsidiaries to (a) agree to any material amendment, restatement
supplement or other modification to any of its material rights under the
Aerostructures Merger Agreement after the Sixth Amendment Closing Date without
in each case obtaining the prior written consent of the Administrative Agent to
such amendment, restatement, supplement or other modification; and (b) amend or
otherwise change the terms of the Senior Notes and the Senior Notes Indenture,
or make any payment consistent with an amendment thereof or change thereto
without such amendment or change being approved in accordance with the
provisions of this Agreement, if the effect of such amendment or change is to
increase the interest rate on the Senior Notes, change (to earlier dates) any
dates upon which payments of principal or interest are due thereon, change any
event of default or condition to an event of default with respect thereto
(other than to eliminate any such event of default or increase any grace period
related thereto), change the redemption, prepayment or defeasance provisions
thereof, or if the effect of such amendment or change, together with all other
amendments or changes made, is to increase materially the obligations of the
obligor thereunder or to confer any additional rights on the holders of such
Senior Notes (or a trustee or other representative on their behalf) which would
be adverse to any Lender, in each case without the prior written concurrence of
the Administrative Agent.”

 

1.16                        Amendments
to Section 8:  Events of Default.

 

A.                                   Subsection 8.1(b) is hereby amended
by deleting such subsection in its entirety and replacing it with the
following:

 

“                                          (b)                                 Default
in Other Agreements.  (i) Failure of
any Credit Party to pay when due any principal of or interest on or any other
amount payable in respect of one or more items of Indebtedness for Borrowed
Money (other than Indebtedness for Borrowed Money referred to in Section
8.1(a)) in an individual or aggregate amount of $15,000,000 or more beyond the
grace period, if any, provided therefore; or (ii) breach or default by any
Credit Party with respect to any other material term of (1) one or more items
of Indebtedness for Borrowed Money in the individual or aggregate principal
amount referred to in clause (i) above or (2) any loan agreement, mortgage,
indenture or other agreement relating to such item(s) of Indebtedness, in each
case beyond the grace period, if any, provided therefore, if the effect of such
breach or default is to cause, or to permit the holder or holders of that
Indebtedness (or a trustee on behalf of such holder or holders), to cause, that
Indebtedness to become or be declared due and payable (or

 

14

 

redeemable) prior to its stated maturity or the stated
maturity of any underlying obligation, as the case may be; or”

 

B.                                     Subsection 8.1(h) is hereby amended
by deleting such subsection in its entirety and replacing it with the
following:

 

“                                          (h)                                 Judgments and Attachments. 
Any money judgment, writ or warrant of attachment or similar process
involving individually or in the aggregate an amount in excess of $15,000,000
(to the extent not adequately covered by insurance) shall be entered or filed
against a Credit Party or any material portion of their respective assets and
shall remain undischarged, unvacated, unbonded or unstayed for a period of
sixty (60) days (or in any event later than five days prior to the date of any
proposed sale thereunder); or”

 

1.17                        Amendments
to 10.16:  Confidentiality.

 

Subsection
10.16 of the Credit Agreement is hereby amended by adding the following
paragraph at the conclusion thereof:

 

“                                          Notwithstanding
anything to the contrary set forth herein, each party (and each of their
respective employees, representatives or other agents) may disclose to any and
all persons, without limitations of any kind, the tax treatment and tax
structure of the transactions contemplated by this Agreement and all materials
of any kind (including opinions and other tax analyses) that are provided to
any such party relating to such tax treatment and tax structure.  However, any information relating to the tax
treatment or tax structure shall remain subject to the confidentiality
provisions hereof (and the foregoing sentence shall not apply) to the extent
reasonably necessary to enable the parties hereto, their respective Affiliates,
and their directors and employees, and their respective Affiliates’ directors
and employees to comply with applicable securities laws.  For this purpose, “tax structure” means any
facts relevant to the federal income tax treatment of the transactions
contemplated by this Agreement but, to the extent not inconsistent with the
foregoing, does not include information relating to the identity of any of the
parties hereto or any of their respective Affiliates.”

 

SECTION 2.                                                    AMENDMENTS
TO SCHEDULES

 

2.1                               Schedule 6.1 of the Credit Agreement
is hereby amended by deleting such Schedule in its entirety and replacing it
with Exhibit A-1 attached hereto.

 

2.2                               Schedule 6.2 of the Credit Agreement
is hereby amended by deleting such Schedule in its entirety and replacing it
with Exhibit A-2 attached hereto.

 

15

 

SECTION 3.                                                    CONSENT

 

Requisite Lenders (i) hereby
consent to the amendment of the Articles of Incorporation of Company in
connection with the Aerostructures Merger and (ii) and Company hereby authorize
the Arrangers and their counsel to prepare a conformed copy of the Credit
Agreement which gives effect to each amendment to the Credit Agreement.

 

SECTION 4.                                                    CONDITIONS
PRECEDENT TO EFFECTIVENESS

 

4.1                               The effectiveness of the amendments
set forth at Sections 1 and 2 and the consent set forth at Section 3 hereof are
subject to the satisfaction, or waiver, of the following conditions on or
before the date hereof (the “Sixth Amendment Closing Date”):

 

(a)                                  Consent.  Company, the Guarantors and Requisite
Lenders and each Lender providing a New Revolving Commitment (the “New Revolving Lenders”) shall have indicated
their consent by the execution and delivery of the signature pages hereof to
the Agent.

 

(b)                                  Sixth
Amendment Closing Date Certificate. 
Company shall have delivered to Agents an originally executed Sixth
Amendment Closing Date Certificate, together with all attachments thereto.

 

(c)                                  Organizational
Documents.  Administrative
Agent shall have received (i) copies of each Organizational Document originally
executed and delivered by each Credit Party (including, each Credit Party that
is acquired on the Sixth Amendment Closing Date pursuant to the Aerostructures
Merger (the “New Guarantors”)), as
applicable, and, to the extent applicable, certified as of a recent date by the
appropriate governmental official; (ii) signature and incumbency certificates
of the officers of such Person executing the Credit Documents to which it is a
party; (iii) resolutions of the Board of Directors or similar governing body of
each Credit Party approving and authorizing the execution, delivery and
performance of this Amendment, the Senior Notes Indenture and the
Aerostructures Merger Agreement to which it is a party, certified as of the
Sixth Amendment Closing Date by its secretary or an assistant secretary as
being in full force and effect without modification or amendment; (iv) a good
standing certificate from the applicable Governmental Authority of each Credit
Party’s jurisdiction of incorporation, organization or formation and, with
respect to any New Guarantor, in each jurisdiction in which such New Guarantor
is qualified as a foreign corporation or other entity to do business, each
dated a recent date prior to the Sixth Amendment Closing Date; and (v) a fully
executed Counterpart Agreement and Pledge Supplement with respect to each New
Guarantor.

 

(d)                                  The
Aerostructures Merger.  As of the
Sixth Amendment Closing Date, (i) all conditions to consummation of the
Aerostructures Merger set forth in Article 8 of the Aerostructures Merger
Agreement shall have been satisfied in all material respects or the fulfillment
of any such material conditions shall have been waived with the consent of the
Agents; (ii) the Aerostructures Merger shall have become effective in
accordance with the terms of the Aerostructures Merger Agreement; (iii) the
aggregate cash consideration paid to

 

16

 

Aerostructures Corp. on the Sixth Amendment Closing Date in connection
with the Aerostructures Merger shall not exceed $210,000,000; (iv) the Agents
shall have received fully executed or conformed copies of the Aerostructures
Merger Agreement; and (v) the Aerostructures Merger Agreement shall be in full
force and effect and no provision thereof shall have been modified or waived in
any manner materially adverse to the Lenders, in each case without the consent
of the Agents.

 

(e)                                  Issuance
of Senior Notes.  On or before the
Sixth Amendment Closing Date, Company shall have issued and sold the Senior
Notes for gross cash proceeds therefore in an aggregate amount of not less than
$270,000,000.

 

(f)                                    Existing
Indebtedness.  On the Sixth
Amendment Closing Date, Company and its Subsidiaries shall have (i) repaid in
full all Indebtedness of Aerostructures Corp. that is listed on Exhibit C to
this Amendment; (ii) terminated any conditions to lend or make other extensions
of credit thereunder; and (iii) delivered to the Agents all documents or other
instruments necessary to release all Liens securing such Indebtedness.

 

(g)                                 Security.  The Collateral Agent shall have received:

 

(i)                                     evidence
satisfactory to the Collateral Agent that it has a First Priority perfected
security interest in all of the Collateral that is newly acquired by Company
and its Subsidiaries pursuant to the Aerostructures Merger (except as otherwise
contemplated by the Pledge and Security Agreement) subject to no Liens other
than Permitted Liens.  Such evidence may
include, but shall not be limited to, searches of appropriate UCC records,
searches of the Patent and Trademark Office, searches of appropriate foreign
records and duly executed UCC or other termination statements relating to the
results of such searches. 
Notwithstanding any of the foregoing to the contrary, with respect to
any real estate assets that are acquired by Company in connection with the
Aerostructures Merger which are Material Real Estate Assets, Company is not
required to grant a First Priority perfected security interest in any such
Material Real Estate Assets as a condition to effectiveness of this Sixth
Amendment, but rather, Company shall comply with Section 5.11 of the Credit
Agreement with respect to any such Material Real Estate Assets;

 

(ii)                                  with
respect to all Collateral to be acquired in connection with the Aerostructures
Merger, a completed UCC Questionnaire dated as of the Sixth Amendment Closing
Date and executed by an Authorized Officer of Company, together with all
attachments contemplated thereby, including (A) the results of a recent search,
by a Person satisfactory to Collateral Agent, of all effective UCC financing
statements (or equivalent filings) made with respect to any personal or mixed
property of Aerostructures Corp. in the jurisdiction specified in the UCC
Questionnaire, together with all attachments contemplated thereby, and (B)
pay-off letters and UCC termination statements (or similar documents confirming
cancellation or repayment of obligations) from all applicable Persons for
filing in all applicable jurisdictions as may be necessary to terminate any
effective UCC financing statements (or equivalent filings)

 

17

 

disclosed in such search
(other than any such financing statements in respect of Permitted Liens); and

 

(iii)                               evidence that each
Credit Party shall have taken or caused to be taken any other action, executed
and delivered or caused to be executed and delivered any other agreement,
document and instrument and made or caused to be made any other filing and
recording (other than as set forth herein) reasonably required by Collateral
Agent.

 

(h)                                 Ratings.  The Credit Party’s shall have received
credit rating by Moody’s and by S&P in connection with transactions
contemplated by this Amendment.

 

(i)                                    Representations
and Warranties.  As of the Sixth
Amendment Closing Date, after giving effect to this Amendment, the
representations and warranties contained herein and in the other Credit
Documents shall be true, correct and complete in all material respects on and
as of the Sixth Amendment Closing Date to the same extent as though made on and
as of that date, except to the extent such representations and warranties
specifically relate to an earlier date, in which case such representations and
warranties shall have been true, correct and complete in all material respects
on and as of such earlier date.

 

(j)                                    No
Event of Default.  As of the Sixth
Amendment Closing Date, after giving effect to this Amendment, no event shall
have occurred and be continuing that would constitute an Event of Default or a
Default.

 

(k)                                Legal
Opinion.  New Revolving Lenders,
Requisite Lenders, and Agents shall have received originally executed copies of
the favorable written opinions of Latham & Watkins, counsel for the Credit
Parties, in form and substance reasonably satisfactory to the Agents, dated as
of the Sixth Amendment Closing Date.

 

(l)                                    Notes.  Company shall have, if so requested by any
New Revolving Lender by written notice (with a copy to Administrative Agent) at
least two Business Days prior to the Sixth Amendment Closing Date, executed and
delivered to such Lender on the Sixth Amendment Closing Date a Note or Notes to
evidence such New Revolving Lender’s New Revolving Commitments.

 

(m)                              Voluntary
Prepayment.  On or before the Sixth
Amendment Closing Date Company shall have made a voluntary prepayment of the
Loans in an amount of not less than $40,000,000, such voluntary prepayment to
be applied as specified by Company in the applicable notice of prepayment.

 

(n)                                 Fees.  (i) The Administrative Agent shall have
received for distribution to each Lender that executes this Amendment on or
before June 13, 2003, an amendment fee equal to 0.25% of such Lenders’
outstanding Loans and Commitments on the Sixth Amendment Closing Date (without
giving effect to the New Revolving Commitments); and (ii)  the Agents shall have received all fees and
other amounts due and payable on or prior to the Sixth

 

18

 

Amendment Closing Date,
including, to the extent invoiced, reimbursement or other payment of all
out-of-pocket expenses required to be reimbursed or paid by Company hereunder
or under any other Credit Document.

 

(o)                                  Financial
Statements.  The Lenders shall have
received (i) the audited financial statements for Aerostructures Corp. for the
last three fiscal years ending prior to the Sixth Amendment Closing Date; (ii)
the unaudited financial statements for Aerostructures Corp. (A) for the
financial period ending March 31, 2003; and (B) if the Sixth Amendment Closing
Date is later than June 15, 2003, for the most recently completed financial
period ending forty-five (45) days prior to the Sixth Amendment Closing Date;
and (iii) (A) pro forma financial statements of Company and its Subsidiaries
with respect to the financial period ending March 31, 2003 reflecting the
Aerostructures Merger (calculated in accordance with the terms and provisions of
the Credit Agreement, including, without limitation, Section 6.8(e) as amended
hereby and calculated as if the Aerostructures Merger had occurred on the date
of such financial statements); and (B) in the event that the Sixth Amendment
Closing Date is later than June 15, 2003, pro forma financial statements for
the most recently completed financial period ending forty-five (45) days prior
to the Sixth Amendment Closing Date reflecting the Aerostructures Merger
(calculated in a manner that is not materially inconsistent with the financial
statements delivered in clause (A) and in form and scope reasonably
satisfactory to the Arrangers). 
Notwithstanding any of the foregoing to the contrary, the Arrangers
acknowledge that they have received and are satisfied with the financial
statements required in (i) above and in (ii) and (iii) above (with respect to
March 31, 2003).  Such financial
statements set forth in (iii) above shall confirm that the pro forma Leverage
Ratio for the twelve month period ending on the date of such financial
statements was not greater than 3.00:1.00 (calculated in accordance with the
provisions set forth in (iii)(A) or (iii)(B), as applicable).

 

SECTION 5.                                                    REPRESENTATIONS AND WARRANTIES

 

5.1                               In order
to induce Requisite Lenders to enter into this Amendment, each applicable
Credit Party represents and warrants to each Lender, as of the date hereof and
upon giving effect to this Amendment, that the representations and warranties
contained in each of the Credit Documents are true, correct and complete in all
material respects on and as of the date hereof to the same extent as though
made on and as of that date, except to the extent such representations and
warranties specifically relate to an earlier date, in which case such
representations and warranties shall have been true, correct and complete in
all material respects on and as of such earlier date.

 

5.2                               Each New Revolving Lender party to
this Amendment, by delivering its signature page to this Amendment, shall be
deemed to have acknowledged receipt of, and consented to and approved, each
Credit Document and each other document required to be approved by any Agent,
Requisite Lenders or New Revolving Lenders, as applicable on the Sixth
Amendment Closing Date.

 

19

 

SECTION 6.                                                    ACKNOWLEDGMENT
AND CONSENT

 

6.1                               Each of Vought Commercial Aircraft
Company and VAC Industries, Inc. has (i) guarantied the Obligations and
(ii) created Liens in favor of Lenders on certain Collateral to secure its
obligations under Section 7 of the Credit Agreement.  Vought Commercial Aircraft Company and VAC Industries, Inc. are
collectively referred to herein as the “Credit Support Parties”, and the Credit Agreement, the
Pledge and Security Agreement, dated as of July 24, 2000, between Company, each
of the grantors party thereto and Lehman Commercial Paper Inc., as Collateral
Agent (as such may be amended, supplemented or modified) (the “Pledge and Security Agreement”) are collectively referred to
herein as the “Credit Support Documents”.

 

6.2                               Each Credit Support Party hereby
acknowledges that it has reviewed the terms and provisions of the Credit
Agreement and this Amendment and consents to the amendment of the Credit
Agreement effected pursuant to this Amendment (the “Amended Agreement”). 
Each Credit Support Party hereby confirms that each Credit Support
Document to which it is a party or otherwise bound and all Collateral
encumbered thereby will continue to guarantee or secure, as the case may be, to
the fullest extent possible in accordance with the Credit Support Documents,
the payment and performance of all Guaranteed Obligations under the Credit
Agreement Secured Obligations (as such term is defined in the Pledge and
Security Agreement) under the Pledge and Security Agreement, as the case may
be, including without limitation the payment and performance of all such
Guaranteed Obligations under the Credit Agreement and Secured Obligations (as
such term is defined in the Pledge and Security Agreement) under the Pledge and
Security Agreement in respect of the Obligations of Company now or hereafter
existing under or in respect of the Amended Agreement, and grants to the
Collateral Agent a continuing lien on and security interest in and to all
Collateral as collateral security for the prompt payment and performance in
full when due of the Guaranteed Obligations under the Credit Agreement and the
Secured Obligations (as such term is defined in the Pledge and Security
Agreement) under the Pledge and Security Agreement (whether at stated maturity,
by acceleration or otherwise).

 

6.3                               Each Credit Support Party
acknowledges and agrees that any of the Credit Support Documents to which it is
a party or otherwise bound shall continue in full force and effect and that all
of its obligations thereunder shall be valid and enforceable and shall not be
impaired or limited by the execution or effectiveness of this Amendment.  Each Credit Support Party represents and
warrants that all representations and warranties contained in the Amended Agreement
and the Credit Support Documents to which it is a party or otherwise bound are
true, correct and complete in all material respects on and as of the Sixth
Amendment Closing Date to the same extent as though made on and as of that
date, except to the extent such representations and warranties specifically
relate to an earlier date, in which case they were true, correct and complete
in all material respects on and as of such earlier date.

 

6.4                               Each Credit Support Party
acknowledges and agrees that (i) notwithstanding the conditions to
effectiveness set forth in this Amendment, such Credit Support Party is not
required by the terms of the Credit Agreement or any other Credit Document

 

20

 

to consent to the amendments to the Credit
Agreement effected pursuant to this Amendment and (ii) nothing in the
Credit Agreement, this Amendment or any other Credit Document shall be deemed
to require the consent of such Credit Support Party to any future amendments to
the Credit Agreement.

 

SECTION 7.                                                    MISCELLANEOUS

 

7.1                               This Amendment shall be binding upon
the parties hereto and their respective successors and assigns and shall inure
to the benefit of the parties hereto and the successors and assigns of
Lenders.  No Credit Party’s rights or
obligations hereunder or any interest therein may be assigned or delegated by
any Credit Party without the prior written consent of all Lenders (except as
may otherwise be permitted under Section 6.9 of the Credit Agreement).

 

7.2                               In case any provision in or
obligation hereunder shall be invalid, illegal or unenforceable in any
jurisdiction, the validity, legality and enforceability of the remaining
provisions or obligations, or of such provision or obligation in any other
jurisdiction, shall not in any way be affected or impaired thereby.

 

7.3                               On and after the Sixth Amendment
Closing Date, each reference in the Credit Agreement to “this Agreement”,
“hereunder”, “hereof”, “herein” or words of like import referring to the Credit
Agreement, and each reference in the other Credit Documents to the “Credit
Agreement”, “thereunder”, “thereof” or words of like import referring to the
Credit Agreement shall mean and be a reference to the Credit Agreement as
amended by this Amendment.

 

7.4                               Except as specifically amended by
this Amendment, the Credit Agreement and the other Credit Documents shall
remain in full force and effect and are hereby ratified and confirmed.

 

7.5                               The execution, delivery and
performance of this Amendment shall not, except as expressly provided herein,
constitute a waiver of any provision of, or operate as a waiver of any right,
power or remedy of any Agent or Lender under, the Credit Agreement or any of
the other Credit Documents.

 

7.6                               Section headings herein are
included herein for convenience of reference only and shall not constitute a
part hereof for any other purpose or be given any substantive effect.

 

7.7                               THIS AMENDMENT AND THE RIGHTS AND
OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE GOVERNED BY, AND SHALL BE
CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK
WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAW.

 

21

 

7.8                               This Amendment may be executed in
any number of counterparts, each of which when so executed and delivered shall
be deemed an original, but all such counterparts together shall constitute but
one and the same instrument.  As set
forth herein, this Amendment shall become effective upon the execution of a
counterpart hereof by each of the parties hereto and receipt by Company and
Agents of written or telephonic notification of such execution and
authorization of delivery thereof.

 

[The
remainder of this page is intentionally left blank.]

 

22

 

IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed and
delivered by their respective officers thereunto duly authorized as of the date
first written above.

 

 

	
  COMPANY:

  	
  VOUGHT
  AIRCRAFT INDUSTRIES, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
  CREDIT
  SUPPORT

  PARTIES:

  	
   

  
	
   

  	
   

  
	
   

  	
  VOUGHT
  COMMERCIAL AIRCRAFT

  COMPANY

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  VAC
  INDUSTRIES, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

S-1

 

	
  ADMINISTRATIVE
  AGENT,

  COLLATERAL AGENT,

  SWING LINE LENDER,

  A LENDER AND A NEW

  REVOLVING LENDER:

  	
  LEHMAN
  COMMERCIAL PAPER INC.,

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  

 

S-2

 

	
  JOINT
  ARRANGER AND

  JOINT BOOK MANAGER:

  	
  LEHMAN
  BROTHERS INC.,

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  

 

S-3

 

	
  SYNDICATION AGENT,

  JOINT ARRANGER,

  JOINT BOOK MANAGER,

  A LENDER AND A NEW

  REVOLVING LENDER:

  	
  GOLDMAN
  SACHS CREDIT PARTNERS L.P.,

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Authorized Signatory

  

 

S-4

 

	
  LENDER:

  	
  [INSTITUTION]

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  

 

 

EXHIBIT A-1 and A-2

TO SIXTH AMENDMENT TO

CREDIT AND GUARANTY AGREEMENT

 

Schedule 6.1 (to be attached)

Schedule 6.2 (to be attached)

 

A-1

 

EXHIBIT B TO

SIXTH AMENDMENT TO

CREDIT AND GUARANTY AGREEMENT

 

SIXTH AMENDMENT CLOSING DATE CERTIFICATE

 

THE UNDERSIGNED COMPANY HEREBY CERTIFIES AS FOLLOWS:

 

1.                                       Pursuant
to the Credit and Guaranty Agreement, dated as of July 24, 2000 as amended
through the date hereof (as it may be amended, supplemented or otherwise
modified, the “Credit Agreement”;
the terms defined therein and not otherwise defined herein being used herein as
therein defined), by and among Company, certain Subsidiaries of Company, as
Guarantors, the Lenders party thereto from time to time, LEHMAN COMMERCIAL PAPER INC., as
Administrative Agent and Collateral Agent, GOLDMAN
SACHS CREDIT PARTNERS L.P.  (“GSCP”),
as Syndication Agent, and GSCP and LEHMAN BROTHERS
INC., as Joint Arrangers and Joint Book Managers, Company certifies
that as of the date hereof:

 

2.                                       (a)
as of the Sixth Amendment Closing Date, after giving effect to the Sixth
Amendment, the representations and warranties contained in each of the Credit
Documents are true and correct in all material respects on and as of the Sixth
Amendment Closing Date to the same extent as though made on and as of such
date, except to the extent such representations and warranties specifically
relate to an earlier date, in which case such representations and warranties
are true and correct in all material respects on and as of such earlier date;

 

(b) as of the Sixth Amendment
Closing Date, after giving effect to the Sixth Amendment, no event has occurred
and is continuing or would result from the consummation of the borrowing
contemplated hereby that would constitute an Event of Default or a Default.

 

3.                                       Each
Credit Party has requested Latham & Watkins to deliver to Agents and
Lenders on the Sixth Amendment Closing Date written opinions in form and
substance satisfactory to the Agents.

 

[Remainder
of page intentionally left blank]

 

B-1

 

The foregoing certifications
are made and delivered as of July 2, 2003.

 

	
   

  	
  VOUGHT
  AIRCRAFT INDUSTRIES, INC.

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

B-2

 

EXHIBIT
C

TO SIXTH AMENDMENT TO

CREDIT AND GUARANTY AGREEMENT

 

EXISTING INDEBTEDNESS TO BE PREPAID

 

Credit Agreement dated as of November 12, 2002
between The Aerostructures Corporation, TA Acquisition Holdings, Inc., the
subsidiary guarantors party thereto, the lenders party thereto, Lehman
Commercial Paper Inc., as administrative agent and Lehman Brothers Inc., as
sole lead arranger and sole bookrunning manager.

 

C-1Exhibit
10.2

 

SUBLEASE AGREEMENT OF PORTIONS

OF MARSHALL STREET FACILITIES

 

 

TABLE OF CONTENTS

 

	
  1.

  	
  Description and Demise
  of Premises

  	
  2

  
	
   

  	
   

  	
   

  
	
  2.

  	
  Purpose of Sublease Agreement

  	
  3

  
	
   

  	
   

  	
   

  
	
  3.

  	
  Rent

  	
  3

  
	
   

  	
   

  	
   

  
	
  4.

  	
  Term and
  Termination of Sublease Agreement

  	
  3

  
	
   

  	
   

  	
   

  
	
  5.

  	
  Operating Expenses

  	
  4

  
	
   

  	
   

  	
   

  
	
  6.

  	
  Emergency
  Response and Compliance with Fire and Safety Requirements

  	
  6

  
	
   

  	
   

  	
   

  
	
  7.

  	
  Alterations,
  Additions, or Improvements

  	
  7

  
	
   

  	
   

  	
   

  
	
  8.

  	
  Repairs and Maintenance

  	
  7

  
	
   

  	
   

  	
   

  
	
  9.

  	
  Mutual Indemnity by the
  Parties

  	
  8

  
	
   

  	
   

  	
   

  
	
  10.

  	
  Assignment and Subletting

  	
  9

  
	
   

  	
   

  	
   

  
	
  11.

  	
  Access to Premises

  	
  10

  
	
   

  	
   

  	
   

  
	
  12.

  	
  Condemnation

  	
  11

  
	
   

  	
   

  	
   

  
	
  13.

  	
  Casualty Damage or Injury

  	
  11

  
	
   

  	
   

  	
   

  
	
  14.

  	
  Holding
  Over

  	
  12

  
	
   

  	
   

  	
   

  
	
  15.

  	
  Taxes

  	
  12

  
	
   

  	
   

  	
   

  
	
  16.

  	
  Default of Sublessee

  	
  12

  
	
   

  	
   

  	
   

  
	
  17.

  	
  Waiver of Breach

  	
  13

  
	
   

  	
   

  	
   

  
	
  18.

  	
  Disputes

  	
  13

  
	
   

  	
   

  	
   

  
	
  19.

  	
  Attorney’s
  Fees

  	
  13

  
	
   

  	
   

  	
   

  
	
  20.

  	
  Liens

  	
  13

  
	
   

  	
   

  	
   

  
	
  21.

  	
  Liability for
  the Premises and Insurance

  	
  14

  
	
   

  	
   

  	
   

  
	
  22.

  	
  Change of Building Name

  	
  14

  
	
   

  	
   

  	
   

  
	
  23.

  	
  Estoppel Certificates

  	
  14

  
	
   

  	
   

  	
   

  
	
  24.

  	
  Notice

  	
  15

  
	
   

  	
   

  	
   

  
	
  25.

  	
  Force Majeure

  	
  15

  
	
   

  	
   

  	
   

  
	
  26.

  	
  Severability

  	
  15

  

 

 

	
  27.

  	
  Amendments

  	
  15

  
	
   

  	
   

  	
   

  
	
  28.

  	
  Quiet
  Enjoyment

  	
  16

  
	
   

  	
   

  	
   

  
	
  29.

  	
  Notice to Lender

  	
  16

  
	
   

  	
   

  	
   

  
	
  30.

  	
  Compliance
  with Environmental Laws and Regulations

  	
  16

  
	
   

  	
   

  	
   

  
	
  31.

  	
  Captions

  	
  18

  
	
   

  	
   

  	
   

  
	
  32.

  	
  Miscellaneous

  	
  18

  
	
   

  	
   

  	
   

  
	
  33.

  	
  Exhibits and Attachments

  	
  19

  

 

 

SUBLEASE AGREEMENT

 

This Sublease Agreement effective as of the
15th day of October, 1993, by and between Loral Vought Systems Corporation
(formerly Loral Missile Systems Corporation), (hereinafter called the
“Sublessor”) and Vought Aircraft Company, a Delaware Corporation (hereinafter
called the “Sublessee”). (Hereinafter Sublessor and Sublessee may be
individually referred to as a “Party” or collectively as the “Parties.”)

 

RECITALS

 

Whereas, Aerospace Mortgage Corp., a
Delaware corporation (herein called the “Original Lessor”), and LTV Aerospace
Corporation, predecessor to the LTV Aerospace and Defense Company (“LTVAD”) (herein
called the “Lessee”) entered into a Lease Agreement dated December 29, 1967
(herein called the “Main Lease”) covering the lease of land, buildings, and
improvements (the “Main Lease Premises”); and

 

Whereas, the Original Lessor and Bankers
Trust Company and G. R. Inc., (herein called the “Trustees”) entered into an
Indenture of Mortgage and Deed of Trust dated December 29, 1967 (herein called
the “Indenture”) pursuant to which a first lien was created on the Main Lease
Premises, subject to the Main Lease and Lessee’s estate under the Main Lease;
and

 

Whereas, the Original Lessor, Lessee and
the Trustees entered into an Assignment of Lease and Agreement dated December
29, 1967 (herein called the “Lease Assignment”) under which the rights of the
Original Lessor were assigned to the Trustees as collateral security; and

 

Whereas, the Original Lessor conveyed its
entire interest in the Main Lease Premises, and its interest as lessor under
the Main Lease, to Airloeb Company, a New York limited partnership (herein
called the “Landlord”), subject to the lien of the Indenture, the Main Lease
and the Lease Assignment; and

 

Whereas, for the purpose of amending and
supplementing the Main Lease, Landlord and Lessee entered into a Lease
Supplement dated May 1, 1968; a Second Lease Supplement dated August 28, 1969;
and the Third Lease Supplement dated July 30, 1982; and

 

Whereas, said Main Lease was assigned by
LTVAD to Sublessor, pursuant to the Asset Purchase Agreement dated August 20,
1992; and

 

Whereas, the Sublessor agrees to sublease
to Sublessee, pursuant to the Separation Agreement dated August 31, 1992
(hereinafter called the “Separation Agreement”) between VAC Acquisition Corp.,
The Carlyle Group, L.P., Loral Vought Systems Corporation, and the Loral
Corporation, a portion of the property subject to the Main Lease; and

 

Whereas, the Sublessee desires to sublease
said property.

 

1

 

Now,
therefore, in consideration of the mutual covenants contained herein, the Parties
agree as follows:

 

1.             Description and Demise of Premises.
Subject to the provisions of the Main Lease, Sublessor does demise to Sublessee
807,298 sq. ft. of the property (the “Premises”) more fully described in
Exhibit A and Attachment 1 attached hereto, including the following;

 

(a)           The
Westerly portion of Building “Ml,” West of Column Line “K” to include First
Floor and all Mezzanine areas;

 

(b)           A
portion of the Shipping Building attached to the Southwestern portion of
Building “Ml”;

 

(c)           All
of building  “M12”  known as the Paint Preparation Area;

 

(d)           All
of shed located East of Building “M1l”;

 

(e)           Paint
Booth #4 located Southeast of Building “Ml” and attached thereto;

 

(f)            Building
“M55” known as the K.P.R. Building;

 

(g)           Railroad
siding, track and Right-of-Way from the Westerly property line proceeding east
to a point of track termination in the Shipping Building as described in Item
(b) above;

 

(h)           Guest,
Visitor, and Employee Parking on the North side of Building “Ml”, designated
Lots “C” and “E”;

 

(i)            A
receiving dock area to be constructed by Sublessee at Building “Ml” at
Sublessee’s expense;

 

(j)            For
purposes of calculating Base Rent, the Premises do not include:

 

(i)            Paint
Booth #4 in Building Ml (3,986 sq. ft.);

 

(ii)           KPR/VOC
Control in building M55 (3,762 sq. ft.);

 

(iii)          Building M56 which is leased directly by Sublessee from a
third party;

 

(iv)          Shed
E. of Building M1l (3,375 sq. ft.); and

 

(v)           Paint/Prep/Skin
Q. in Building M12 (43,946 sq. ft.).

 

(k)           The
Premises do not include the Paint Booth and Staging Area described in Exhibit A
as the Loral Paint Shop. Sublessee shall have the option to add 3,915 sq. ft.
of the Paint Booth and Staging Area, described in Exhibit A, to this Sublease
Agreement upon six (6) months written notice to Sublessor.

 

2

 

The Base Rent payable by Sublessee pursuant
to paragraph 3 and paragraph 5 shall be increased proportionately.

 

2.             Purpose of Sublease Agreement.
This Sublease Agreement has been entered into by the Parties to facilitate the
business operations of each Party pursuant to the Separation Agreement and it
is therefore the intent of the Parties to cooperate to ensure minimal adverse
impact on the business of each as a result of this Sublease Agreement or the
Separation Agreement.  The Premises
demised under this Sublease Agreement are to be used by Sublessee in the
conduct of its business and Sublessee will not permit anything to be done which
will in any way increase the rate of insurance on the buildings or their
contents unless Sublessee pays such increase. Sublessee will conduct its
business and control its agents, employees and invitees in such a manner as not
to create any nuisance, nor interfere with, annoy or disturb other occupants.  Sublessee will maintain the Premises in a
clean, healthful and safe condition and will comply with all laws, ordinances,
orders, rules and regulations (state, federal, municipal and other agencies or
bodies having any jurisdiction thereof) with reference to the use, condition or
occupancy of the Premises.  Sublessee
will not, without the prior written consent of Sublessor, which consent shall
not unreasonably be withheld, paint, install lighting or decorations, or
install any signs, window or door lettering or advertising media.

 

3.             Rent. 
Sublessee shall pay Sublessor during the term of this Sublease Agreement
without demand or notice, and without set-off or deduction, a basic rental in
advance of the first day of each and every month as follows:

 

(a)           September
1, 1992 through March 31, 1994 at $1.81 per square foot per year, times 752,229
square feet, for a total of $113,461.21 per month.

 

(b)           Per
paragraph 4, Sublessee shall pay $.655 per square foot per year, times 752,229
square feet, for a total of  $41,059.17
per month commencing April 1, 1994 through March 31, 2018.

 

(c)           General
and Administrative (G&A) Expense of $273 per month.

 

4.             Term and Termination of Sublease
Agreement.

 

(a)           The
term of this Sublease Agreement shall commence on September 1, 1992 and
continue thereafter until 31 March 1994, or the termination date of the last
extension of the Main Lease exercised by Sublessor, whichever occurs last,
provided however, that this Sublease shall terminate upon any termination of
the Main Lease prior to the specified expiration date as extended pursuant to
this subparagraph.

 

3

 

Sublessee hereby agrees that upon receipt
of notice from Sublessor of Sublessor’s exercise of any and all renewal options
granted Sublessor by Landlord, Sublessee shall be bound under the terms of this
Sublease for a period equal to the Sublessor’s renewed term under the Main
Lease without any action or notice from Sublessee. Sublessor agrees to provide
written notification to Sublessee not later than ninety (90) days prior to the
date Sublessor is required to notify Landlord under the Main Lease, of any
intent not to exercise any lease period extension of the lease term under the
Main Lease. Should Sublessee desire to remain on the Premises Sublessor shall
assign its interests under the Main Lease to Sublessee in accordance with the
provisions of the Main Lease. If the Landlord refuses to consent to such
assignment Sublessor shall exercise the Main Lease term extension provided that
Sublessee agrees to assume responsibility for all costs and obligations of the
Main Lease arising after said assumption of responsibility by Sublessee and to
indemnity, defend and hold harmless the Sublessor for any and all losses,
damages, expenses, liabilities or claims of liability arising under the Main
Lease.

 

(b)           Excluding
Building M56, neither Party may terminate this Sublease Agreement prior to the
expiration of Sublessor’s Main Lease or any exercised extension of the term
thereof. No act or thing done by Sublessor or its agent during the term of this
Sublease Agreement shall be deemed an acceptance of a surrender of the
Premises, and no agreement to accept a surrender of the Premises shall be
valid, unless the same be made in writing and signed by Sublessor. The Premises
shall be returned to Sublessor in as good condition as when received, except
for reasonable wear and tear.

 

5.             Operating Expenses

 

(a)           Utilities.
Sublessor shall make available to Sublessee, except for limitations imposed by
Sublessor’s utility agreements, all electrical current, heat, water, chilled
water for HVAC, deionized water, compressed air, steam, condensate, and gas
required by Sublessee in its use and occupancy of the Premises as further
defined in Exhibit B. However, Sublessor shall not be liable for any cessation
of services resulting from causes beyond the control and without the fault or
negligence of Sublessor, or for any cessation repaired within a reasonable
time.

 

(b)           Repair
and Maintenance. Sublessor shall maintain the buildings and associated
building equipment (excluding those items specifically described in
Exhibit C), parking, and roadways of the Premises, 

 

4

 

as defined in Exhibit A and Attachment 1.

 

(c)           Other.
Sublessor shall provide all-risk property insurance as stated in paragraph 21.
“Operating Expenses” shall mean any and all expenses incurred by Sublessor in
connection with the servicing, operation, maintenance and repair of the
buildings, and related interior and exterior appurtenances of which the
Premises is a part, the costs of services provided to Sublessee such as PH
treatment of water utilized by Sublessee and monitoring of wastewater, and the
cost of any services incurred in order to achieve a reduction of or to minimize
the increase in Operating Expenses, including depreciation or amortization on
capital equipment or systems installed to reduce or minimize increases in
Operating Expenses, depreciation or amortization on capital equipment or
systems required by governmental ordinance, the cost of contesting the validity
or amount of real estate taxes, and periodic increases in Operating Expense
payments under this Sublease Agreement.

 

(d)           Concurrent
with the execution of this Sublease Agreement, an estimated Operating Expense
cost per month will be agreed to in writing by the Parties and attached hereto
as Exhibit D, as may be amended from time to time, based on an annual cost per
square foot divided by twelve. This Operating Expense will be paid by Sublessee
to Sublessor in advance of the first day of each month for the term of this
Sublease Agreement. In order to provide for increase in payments due to any
increase in Sublessor’s Operating Expenses, Sublessor will provide an
accounting of actual Operating Expenses following the end of each accounting
quarter. If Sublessee’s share of Operating Expenses shall be more or less than
the aggregate of all installments paid by Sublessee to Sublessor for that
quarter, then the monthly payment shall be adjusted accordingly. Sublessee
shall have the right to review Sublessor’s records following receipt of ten
(10) days written notice to verify Sublessor’s calculation of Sublessee’s share
of  the Operating Expenses. Said
review shall be subject to reasonable restrictions by Sublessor and shall be
conducted in Sublessor’s office during regular business hours. Sublessor
reserves the right to initiate a change to the Operating Expense monthly
payment rate based upon evidence within the accounting year that substantiates
an equitable adjustment is required. The obligations with respect to the final
payment of such Operating Expenses shall survive the termination of this
Sublease. Any payment made pursuant to this paragraph shall be made without
prejudice to any right of Sublessor to correct any item(s) as billed pursuant
to the provisions hereof 

 

5

 

(e)           Except
as provided in subparagraph (f) below, from time to time, as necessary, the
Sublessor and/or the Sublessee shall authorize and have completed an energy
audit of the Premises, by a licensed or otherwise commercially recognized
competent energy engineering firm or company, for the purpose of defining a
specific methodology for calculating the allocable utility and powerhouse costs
Operating Expense.  The expense of up to
one such audit per calendar year shall be shared equally by the parties.  The expense of any audits undertaken in
excess of one per calendar year shall be borne by the party requesting the
additional audit.

 

(f)            From
time to time either Party may propose a capital energy conservation related
project.  All energy conservation
related projects shall be charged against the powerhouse unit.  Depreciation and related cost savings will
be shared on the basis of the current utility audit.

 

Notwithstanding Subparagraph (e) above
neither party shall be able to authorize without the other Party’s agreement,
an energy audit solely as a result of an energy conservation project undertaken
by either Party.

 

6.             Emergency Response and Compliance
with Fire and Safety Requirements.

 

(a)           Sublessee
shall comply with all reasonable fire and safety requirements promulgated by
Sublessor consistent with Federal, State, and Local fire and safety
requirements applicable to the Premises.

 

(b)           Sublessor
shall prepare appropriate emergency response plans and shall comply with all
Federal, State, and Local fire and safety requirements applicable to the Main
Lease Premises and, insofar as the Premises are within Sublessor’s control, the
Premises.

 

(c)           The
Parties further agree to indemnify each other for any fines or penalties,  losses or costs incurred by one Party as a
result of the other Party’s failure to comply with any applicable Federal,
State and Local fire and safety laws or regulations.

 

(d)           Sublessor
and Sublessee agree to cooperate in the preparation of all emergency response
planning including conducting joint drills and critiques, for operations and
materials on the Premises.

 

(e)           Sublessee
and Sublessor will maintain and provide to each other an emergency call list.

 

6

 

7.             Alterations,
Additions, or Improvements.

 

Sublessee shall not make any alterations,
additions, or improvements on or to the Premises without first obtaining the
written consent of Sublessor and Landlord, which consent shall not unreasonably
be withheld. Such consent shall include approval of all plans and
specifications as well as the contractors and subcontractors hired to perform
the work. Sublessor shall not be deemed unreasonable if failure to give consent
is based on Sublessor’s failure to obtain any required consent of the Landlord,
pursuant to the terms of the Main Lease, in response to a good faith effort to
obtain such consent. Notwithstanding the foregoing, in the event Sublessor does
not notify Sublessee of its decision within thirty (30) days from the date of
submission then Sublessee’s plans, specifications and contractor shall be
deemed approved and Sublessee may proceed with said work. Sublessee warrants
that contractor(s) and subcontractor(s) performing work pursuant to the terms
and conditions of this paragraph shall comply with all applicable company
procedures of Sublessor and all local, state, and federal regulations covering
the work to be performed. All such alterations, additions, and improvements
that shall be made, shall be at the sole expense of Sublessee and shall become
the property of Sublessor and shall remain on and be surrendered with the
Premises as part thereof at the termination of this Sublease Agreement.
Furthermore, Sublessor reserves the right to require Sublessee to remove said
improvements and restore the Premises to the original conditions as nearly as
may be practical, upon the expiration or sooner termination of this Sublease.
Sublessee may, however, move, change, remove, relocate and/or substitute
non-fixtures from time to time as required in its normal course of business
without any liability to Sublessor for the cost thereof. Nothing contained in
this provision shall prevent Sublessee from removing office machines,
equipment, and trade fixtures customarily used in the business of Sublessee.
Sublessor has made no representations as to the conditions of the Premises or
buildings or to remodel, repair or decorate, except as expressly set forth
herein.

 

8.             Repairs and Maintenance.

 

(a)           Sublessee’s
Repairs and Maintenance. Sublessee will not in any manner deface or injure
the Premises or any other areas in support of the Premises, and will pay the
cost of repairing any damage or injury done to the Premises or any part thereof
or any other areas in support of the Premises by Sublessee or Sublessee’s
agents, employees or invitees. Sublessee shall throughout the Sublease
Agreement term take good care of the Premises and keep them free from waste and
nuisance of any kind. Sublessee shall have responsibility for grounds keeping
within the fenced perimeter of the buildings occupied by Sublessee. Sublessee
shall also be responsible for any and all interior painting. Sublessee agrees
to keep the Premises, including all fixtures installed by Sublessee and any
other improvements 

 

7

 

installed and or being depreciated or
amortized by Sublessee, including but not limited to Items listed in Exhibit C,
in good condition and make all necessary non-structural repairs except those
caused by fire, casualty or acts of God covered by Sublessor’s fire insurance
policy covering the buildings. Any repairs to be performed on the Premises
shall be done in compliance with paragraphs 6 and 7 above. If Sublessee fails
to initiate such repairs within thirty (30) days after notification by
Sublessor, Sublessor may at its option make such repair, and Sublessee shall,
upon demand therefor, pay Sublessor for the reasonable cost thereof. If,
however, Sublessee fails to immediately repair fire or safety conditions,
Sublessor may at its option make such fire or safety repair, and Sublessee
shall, upon demand therefor, pay Sublessor for the reasonable cost thereof.

 

(b)           Sublessor’s
Repairs. Excluding those items described in Exhibit C, Sublessor shall at
its expense maintain the roof, foundation, structural soundness of the exterior
walls, heating and air conditioning system, entrance/exit doors, electrical
distribution systems, fire protection system, elevators, plumbing, common
fences, parking lot surfaces, roadways, exterior painting, and the compressed
air system in good repair and condition, reasonable wear and tear excepted and
any injury or damage caused by Sublessee, Sublessees agents, employees or
invitees also excepted, which injury or damage shall be repaired by Sublessee
at Sublessee’s expense. (Refer to Exhibit B for further clarification.)
Sublessee shall give immediate written notice to Sublessor of the need for
repairs or corrections that are Sublessor’s responsibility thereunder, and
Sublessor shall proceed promptly to make such repairs or corrections. If
Sublessor fails to initiate such repairs within thirty (30) days after
notification by Sublessee of the damage or injury, Sublessee may at its option
make such repair, and Sublessor shall, upon demand therefor, pay Sublessee for
the reasonable cost thereof. In the event the nature of Sublessor’s repairs are
either a safety related item and/or would cause an adverse impact to
Sublessee’s normal course of business then Sublessee may make immediate repairs
and upon demand therefor, Sublessor shall pay Sublessee for the reasonable cost
thereof.

 

9.             Mutual Indemnity by the Parties.
Sublessor agrees to indemnify Sublessee against all claims for damages to
property or injury to persons arising from conditions occurring in areas
controlled by Sublessor under the Main Lease and this Sublease Agreement, or
from activities conducted by Sublessor. Sublessee agrees to indemnify Sublessor
and Landlord against all claims for damages to property or injury to persons
arising from conditions occurring in areas controlled by Sublessee under the
Main Lease and this Sublease Agreement, or from activities

 

8

 

conducted by Sublessee. Notwithstanding the
foregoing, Sublessor and Sublessee release each other from any liability for
claims for damages to property which are required to be covered by fire and
casualty insurance pursuant to this Sublease Agreement. This is intended to be
in addition to and not a limitation on the indemnifications provided in
paragraph 30.

 

10.           Assignment and Subletting.

 

(a)           Sublessee
shall not, without the prior written consent of Sublessor and Landlord, which
consent shall not unreasonably be withheld, (1) assign or in any manner
transfer this Sublease Agreement or any estate or interest therein, or (2)
permit any assignment of this Sublease Agreement or any estate or interest
therein by operation of law, or (3) sublet the Premises or any part thereof, or
(4) grant any license, concession or other right of occupancy of any portion of
the Premises or (5) permit the use of the Premises by any parties other than
Sublessee, its agents and employees, and any such acts without Sublessor’s
prior written consent shall be void and of no effect.  Sublessor shall not be considered to have unreasonably withheld
consent if the withholding is based upon Sublessor’s business decision that the
assignment or sublease proposed by Sublessee would be to a party in competition
with Sublessor’s business base. 
Further, Sublessor shall have the right of first refusal to occupy any
space which Sublessee proposes to assign or sublet to a third party other than
a subsidiary, division or operating unit of Sublessee or a successor
corporation through a merger, 
consolidation,  asset or stock
sale transaction.  Consent by Sublessor
to one or more assignments or subletting shall not operate as a waiver of
Sublessor’s rights as to any subsequent assignments and subletting.  Sublessee shall not mortgage, pledge or
otherwise encumber its interest in this Sublease Agreement or in the Premises.
Notwithstanding the above, Sublessee shall have the right to assign its right,
title, and interest in this Sublease Agreement to any successor corporation
through a merger, consolidation, asset or stock sale transaction.

 

(b)           If
Sublessee requests Sublessor’s consent to an assignment of the Sublease
Agreement or subletting of all or a part of the Premises, it shall submit to Sublessor,
in writing, the name of the proposed assignee or sub-sublessee and the nature
and character of the business of the proposed assignee or sub-sublessee, the
term, use, rental rate and other particulars of the proposed subletting or
assignment, including without limitation, evidence satisfactory to Sublessor
that the proposed sub-sublessee or assignee is financially responsible and will
immediately occupy and thereafter use the

 

9

 

Premises (or any sublet portion thereof)
for the remainder of the Sublease Agreement term (or for the entire term of
this sub-Sublease Agreement, if shorter.) If Sublessor consents to any
subletting or assignment by Sublessee as hereinabove provided, and subsequently
any rents received by Sublessee under any such sub-sublease are in excess of
the rent payable by Sublessee under this Sublease Agreement, or any such
assignment, then Sublessor may, at its option, either (1) declare such excess
rents under any sub-sublease or such additional consideration for an assignment
to be due and payable by Sublessee to Sublessor as additional rent hereunder,
or (2) elect to cancel this Sublease Agreement. Sublessor shall respond to
Sublessee’s request in writing, within thirty (30) days from receipt thereof.

 

(c)           Sublessor shall have the right to
transfer, assign and convey, in whole or in part, Sublessor’s leasehold
interest and any and all of its rights and obligations under the Main Lease and
this Sublease Agreement. If the proposed assignment or sub-sublease is for the
full unexpired portion of this Sublease Agreement, Sublessor shall, subject to
subparagraph 30(e), thereby be released from any further obligations hereunder,
and Sublessee agrees to look solely to such successor in interest of Sublessor
for performance of such obligations.

 

11.           Access to Premises.

 

(a)           Subject
to compliance with applicable safety regulations and security requirements,
rules, and regulations of Sublessee and the United States Government, Sublessor
and Landlord, their officers, agents and representatives, shall have the right
to enter any and all parts of the Premises at all reasonable hours to (1)
inspect same or clean or make repairs or alterations or additions as Sublessor
and Landlord may deem necessary (but without any obligation to do so, except as
so expressly provided for herein) or (2) show the Premises to prospective
tenants, purchasers or lenders; and Sublessee shall not be entitled to any
abatement or reduction of rent by reason thereof, nor shall such be deemed to
be an actual or constructive eviction.

 

(b)           Sublessor
shall allow access to the Premises by Sublessee’s personnel,  guests, 
visitors,  and contractors
assigned to the Premises as necessary.

 

(c)           To
the extent necessary to conduct investigations of potential or actual soil or
groundwater contamination,  and subject
to compliance with applicable safety regulations and security requirements of
either Party, either Party shall

 

10

 

have the right to enter any and all parts
of the Premises or contiguous premises operated by the Sublessor for the
purposes of installing soil borings or wells, or taking environmental samples.

 

12.           Condemnation. If the whole or any part of the
Premises shall be taken by any public authority under the power of eminent
domain, or shall be sold to such authority under threat of such power, then
this Sublease Agreement shall cease on the part so taken or sold from the date
of possession of such part for such public purpose, and the rent provided
hereunder shall be paid to such date. 
If such portion of the Premises so taken or sold is such as to destroy
or impair the usefulness of the Premises for the purpose for which same have
been subleased hereunder, Sublessee may elect to terminate this Sublease
Agreement and declare the same null and void as of the date of such taking or
sale by giving written notice thereof to Sublessor within sixty (60) days after
the date of such taking or sale.   If
Sublessee does not so elect to terminate this Sublease Agreement then the
rental payable by Sublessee under paragraph 3 hereof from and after the date
when such possession is taken shall be reduced in the same proportion that the
usefulness of the entire Premises is diminished for Sublessee’s business
operation, such proportion to be mutually agreed upon by both Parties, with due
consideration being given to the square footage of space involved, improvements
involved, and all other pertinent factors. 
Each Party shall be entitled separately to assert against the condemning
authority and to recover such damages as may have accrued to or for its
respective estate unless prohibited by the provisions of the Main Lease.

 

13.           Casualty Damage or Injury. In the
event that any of the buildings should be totally destroyed by fire, tornado or
other casualty or in the event the Premises or the buildings should be so
damaged that rebuilding or repairs cannot be completed within one hundred
eighty (180) days after the date of such damage, either Party may at its option
terminate this Sublease Agreement, in which event the rent shall be abated
during the unexpired portion of this Sublease Agreement effective with the date
of such damage.  In the event the
buildings or the Premises should be damaged by fire, tornado or other casualty,
but only to such extent that rebuilding or repairs can be completed within one
hundred eighty (180) days after the date of such damage, or the damage should
be more serious but Sublessor does not elect to terminate this Sublease
Agreement, in either such event, Sublessor shall within forty-five (45) days
after the date of such casualty, and subject to the availability of insurance
proceeds therefor, commence to rebuild or repair the buildings and/or the
Premises and shall proceed with due diligence to rebuild and restore the
buildings and/or Premises to substantially the same condition in which it was
immediately prior to the happening of such casualty, except that Sublessor
shall not be required to rebuild,

 

11

 

repair or replace any part of the
furniture, equipment, fixtures and other leasehold improvements which may have
been placed by Sublessee or other tenants within the buildings or the Premises.
Sublessor shall allow Sublessee a fair diminution of Basic Rent and Operating
Expenses during the time that such portion of the Premises is unfit for
occupancy. In the event any mortgagee under a deed of trust, security agreement
or mortgage on the building should require that the insurance proceeds,
resulting from any such casualty, be used to retire the mortgage debt on the
buildings and the land, Sublessor shall have no obligation to rebuild and this
Sublease Agreement shall thereupon terminate. Sublessor shall give written
notice to Sublessee of the foregoing. Except as hereinafter provided, any
insurance which may be carried by Sublessor or Sublessee against loss or damage
to the buildings, the Premises or the contents thereof shall be for the sole
benefit of the Party carrying such insurance.

 

14.           Holding Over. Should Sublessee, or any of its
successors in interest, hold over the Premises, or any part thereof, after the
expiration of the Sublease Agreement term, unless otherwise agreed in writing
by Sublessor, such holding over shall constitute and be construed as a
tenancy-at-will only, at a daily rental and operating expenses equal to the
amounts payable for the last month of the Sublease Agreement term as adjusted
to actuals. The inclusion of the preceding sentence shall not be construed as
Sublessor’s consent for Sublessee to hold over.

 

15.           Taxes. Sublessee shall be liable for all taxes levied
or assessed against personal property, furniture or fixtures placed by
Sublessee in the Premises.   In
addition, Sublessee shall also be liable for any increase in property taxes
resulting from leasehold improvements made to the Premises by Sublessee. If any
such taxes for which Sublessee is liable are levied or assessed against
Sublessor or Sublessor’s property and if Sublessor elects to pay the same or if
the assessed value of Sublessor’s property is increased by inclusion of
personal property, furniture or fixtures or leasehold improvement placed or
made by Sublessee in or on the Premises, and Sublessor elects to pay the taxes
based on such increase, Sublessee shall pay to Sublessor upon demand that part
of such taxes for which Sublessee is primarily liable hereunder.

 

16.           Default of Sublessee. If Sublessee fails
to pay when due any rental or other sums payable by Sublessee hereunder or if Sublessee
violates or defaults in any of the provisions of this Sublease Agreement, and
fails to initiate and reasonably pursue a cure of such violation or default
within thirty (30) days after receipt of written notice from Sublessor
detailing such violation or default, then Sublessor may terminate this Sublease
Agreement by giving Sublessee an additional sixty (60)

 

12

 

days advance written notice of Sublessor's
intent to terminate this Sublease Agreement, and re-enter the Premises.
Notwithstanding any re-entry, the liability of Sublessee for the rent shall not
be extinguished for the balance of the term hereof, and Sublessee shall make
good to Sublessor any deficiency arising from a re-entry and reletting of the
Premises at a reduced rate. Sublessor shall make a good faith effort to sublet
the Premises. Sublessee shall pay any deficiency on the first day of each month
immediately following the month in which the amount of deficiency is
ascertained by Sublessor.

 

17.           Waiver of Breach. The waiving of any of the
provisions of this Sublease Agreement by any party shall be limited to the
Premises the particular instance involved and shall not be deemed to waive any
other rights of the same or any other terms of this Sublease Agreement.

 

18.           Disputes. Any dispute between the Parties arising
under or relating to this Sublease Agreement shall be resolved in accordance
with the Arbitration and Disputes clause set forth in the Separation Agreement
dated 31 August 1992 among Loral Vought Systems Corporation and Loral
Corporation (“Loral”) and VAC Acquisition Corp. and The Carlyle Group, L.P.
(“Carlyle”); provided that wherever the name Carlyle appears it shall mean
Vought Aircraft Company and wherever the name Loral appears it shall mean Loral
Vought Systems Corporation.

 

19.           Attorney’s Fees. In case it should be
necessary or proper for either Party to bring any action under this Sublease
Agreement concerning the enforcement of any of its rights hereunder, then the
Parties agree in any such case to pay to the other Party a reasonable
attorney’s fee if the other Party prevails in any such action.

 

20.           Liens.
Sublessee shall keep the Premises free and clear of all liens arising out of
any work performed, material furnished, or obligations incurred by
Sublessee.  If Sublessee fails to keep
the Premises free and clear of all liens, Sublessor shall have the right and
privilege at Sublessor’s option to pay the same or any portion thereof without
inquiry as to the validity thereof, and any amounts so paid, including expenses
and interest shall be considered as additional rental hereunder and payable in
accordance with paragraph 3 above. Sublessee shall not be required, nor shall
Sublessor have the right, to pay, discharge or remove, any liens on or against
the Premises or any portion thereof, so long as Sublessee shall, at its cost
and expense, contest the existence, amount or validity thereof by appropriate
proceedings which shall operate to prevent the realization of the liens.  Sublessee will remove and discharge
promptly, at its cost and expense, all liens, encumbrances and charges upon the
Premises, including all such liens, encumbrances and charges which arise out of
the possession, use, occupancy, maintenance, repair or rebuilding of the
Premises or by reason of labor or

 

13

 

materials furnished or claimed to have been
furnished to Sublessee. All such liens shall be removed prior to the surrender
of the Premises to Sublessor at the end of this Sublease Agreement.

 

21.           Liability for the Premises and
Insurance.

 

(a)           Sublessor
agrees to provide and maintain, during the term of this Sublease Agreement,
all-risk property insurance with insurance companies authorized to do business
in the state of Texas, covering the full replacement value, without deduction
for depreciation, of all real property, including improvements and betterments,
but excluding the personal property of Sublessee.

 

(b)           Sublessee
shall, at all times during the term hereof and at its sole cost and expense,
maintain insurance of the following types:

 

(1)           Comprehensive general liability
insurance in the minimum amounts of 
$5,000,000  per occurrence and in
the aggregate.  Sublessee shall name
Sublessor as an additional insured.

 

(2)           Statutory worker’s compensation
insurance.

 

(3)           All risk property insurance covering
all personal property of Sublessee on the Premises.

 

Such insurance shall be written by
insurance companies authorized to do business in the state of Texas and
reasonably acceptable to Sublessor.

 

(c)           Sublessor
and Sublessee hereby agree to waive subrogation and to cause their respective
insurers to waive subrogation and release each other from all rights of
recovery as respects loss or damage to the Premises or contents required to be
covered by insurance pursuant to this paragraph 21.

 

(d)           Sublessee
shall deliver to Sublessor certificates of insurance, reasonably satisfactory
to Sublessor, evidencing all the insurance which is then required to be
maintained by Sublessee, and providing at least thirty (30) days notice of
cancellation or material change.

 

22.           Change
of Building Name. Sublessee understands and agrees that Landlord and
Sublessor reserve the right at any time to change the name/number by which the
buildings are designated.  Sublessor shall provide prompt notice of
such change to Sublessee.

 

23.           Estoppel
Certificates. Within five (5) business days after receipt of a written
request from Sublessor or Landlord, Sublessee will execute, acknowledge and deliver
to Sublessor or Landlord a statement, signed by Sublessee

 

14

 

and currently dated, certifying that this
Sublease Agreement is unmodified and in full effect (or if there have been
modifications, that this Sublease Agreement is in full effect as modified, and
identifying such modifications) and the dates to which the basic rent and
additional rent and other amounts payable by Sublessee hereunder have been
paid, and either stating that to the knowledge of the signer of such
certificate no default exists in the observance or performance of any provision
contained in this Sublease Agreement and no event of default hereunder has
occurred and is continuing or specifying each such default or event of default
of which the signer may have knowledge, it being intended that any such
statement delivered pursuant to this paragraph may be relied upon by any
mortgagee or by any prospective purchaser of the subleased Premises or any
assignee of such mortgage.

 

24.           Notice.
Except where otherwise required by statute, all notices given pursuant to the
provisions hereof shall be in writing and shall be validly given when sent by
registered or certified mail, return receipt requested, postage prepaid, to the
mailing address of the party for whom the notice is intended as specifically
stated in Exhibit E attached hereto, as may be amended from time to time.

 

25.           Force
Majeure.  Whenever a period of
time is herein prescribed for action to be taken by either Party, that Party
shall not be liable or responsible for, and there shall be excluded from the
computation for any such period of time, any delay due to strikes, riots, acts
of God, shortages of labor or materials, war, governmental laws, regulations or
restrictions or any other causes of any kind whatsoever which are beyond the
control of said Party.

 

26.           Severability.
If any clause or provision of this Sublease Agreement is illegal, invalid or
unenforceable under present or future laws effective during the Sublease
Agreement term, then and in that event, it is the intention of the Parties
hereto that the remainder of this Sublease Agreement shall not be affected
thereby and it is also the intention of the Parties to this Sublease Agreement
that in lieu of each clause or provision of this Sublease Agreement that is
illegal, invalid or unenforceable, there be added as a part of this Sublease
Agreement a clause or provision as similar in terms to such illegal,  invalid or unenforceable clause or provision
as may be possible and be legal, valid and enforceable.

 

27.           Amendments.
This Sublease Agreement may not be altered, changed or amended, except by
instrument in writing signed by both Parties hereto. The terms and conditions
contained in this Sublease Agreement shall apply to, inure to the benefit of,
and be binding upon the Parties hereto, and upon their respective successors in
interest

 

15

 

and legal representatives, except as
otherwise herein expressly provided.

 

28.           Quiet Enjoyment. Provided Sublessee has
performed all of the terms and conditions of this Sublease Agreement, including
the payment of rent, to be performed by Sublessee, Sublessee shall peaceably
and quietly hold and enjoy the Premises for the Sublease Agreement term, without
hindrance from Sublessor, subject to the terms and conditions of this Sublease
Agreement.

 

29.           Notice to Lender. If the Premises or the
buildings or any part thereof are at any time subject to a first deed of trust
or other similar instrument and this Sublease Agreement or the rentals are
assigned to such mortgagee, trustee or beneficiary and Sublessee is given
written notice thereof, including the post office address of such
assignee,  then Sublessee shall not
terminate this Sublease Agreement or abate rentals for any default on the part
of Sublessor without first giving written notice by certified or registered
mail,  return receipt requested, to such
assignee, specifying the default in reasonable detail,  and affording such assignee a reasonable opportunity
to make performance, at its election, for and on behalf of Sublessor.

 

30.           Compliance with Environmental
Laws and Regulations.

 

(a)           Each
Party agrees to comply with all applicable Federal, State and Local health and
environmental laws and regulations related to the Premises, common areas and
adjacent buildings and areas and all activities conducted thereon and to
cooperate with the other Party to ensure that any required permits are acquired
and/or maintained in compliance with applicable Federal, State and Local laws
and regulations.   In addition, each
Party shall take reasonable steps to prevent releases of hazardous substances
from the Premises.

 

(b)           Both
Parties agree that the Wastewater Discharge Permit with the City of Grand
Prairie  (the “Wastewater Permit”) for
the Main Lease Premises and the Premises shall (i) be in the joint names of the
Parties and (ii)  identify sampling
points applicable and assigned to the respective Parties where possible and
(iii) identify sampling points applicable and assigned jointly to the Parties
where assignment to a specific Party is not possible.  The Parties further agree to cooperate in joint negotiations with
the City of Grand Prairie on the terms of the Wastewater Permit and to
indemnify the other for any fines or penalties, losses or costs incurred by one
Party as a result of the other Party’s failure to comply with the terms and
conditions of the Wastewater Permit or any applicable Federal, State and Local
laws or regulations applicable thereto. In the event that

 

16

 

the City of Grand Prairie refuses to issue
the Wastewater Permit in the joint names of the Parties, the Parties agree that
the Wastewater Permit shall be held in the name of Sublessor and shall be for
the entire Main Lease Premises and the Premises, and further agree to enter
into good faith negotiations for the terms and conditions of a separate
agreement between the Parties, including an indemnification provision similar
to that set forth above, setting forth the relationship of the Parties under
the Wastewater Permit, and monitoring points under the Wastewater Permit.

 

(c)           Both
Parties agree to provide copies of all notices received and reports and applications submitted to any Federal, State or
local authority related to any health and environmental laws and regulations
affecting the Premises.  In addition,
set forth as Exhibits F and G are lists of all hazardous materials the
Sublessee and Sublessor plan to use on the Premises, common areas and adjacent
areas. Both Parties agree to notify the other each time the list changes.

 

(d)           In
addition, each Party agrees to defend, indemnify and hold harmless the other
Party,  and in Sublessee’s case
Landlord, from and against all, claims, damages, losses and expenses (including
reasonable expense of investigation and attorney’s fees and expenses)
(“Losses”) caused by or arising out of (1) any violation or non-compliance with
any such Federal,  State  or 
Local  health  and environmental law or regulation by the
indemnifying party or (2) any manufacture, processing, use, generation,
storage, transport, disposal, emission or discharge, by the indemnifying Party
on the Premises common areas and adjacent buildings and areas  of 
any  hazardous  substance 
or  other contaminant in respect
of which any response costs as defined by the Comprehensive Environmental
Response, Compensation, and Liability Act of 1980, as amended, or any removal,
remediation or other cleanup is required, or any judgment or order is rendered,
or any agreement is made by Sublessee or Sublessor under any Environmental
Laws.

 

(e)           Sublessor
further agrees to defend, indemnify and hold Sublessee harmless from and
against all claims, damages, losses, and expenses arising from the claims of third
parties except employees or contractors of Sublessee or Sublessor (including
reasonable expense of investigation and attorney’s fees and expenses)
(“Losses”) caused by or arising out of (1) any violation or non-compliance with
any such  Federal,  State 
or  Local  health 
and environmental law or regulation by Sublessor or (2) any manufacture,  processing, 
use,  generation, storage,
transport, disposal, emission or

 

17

 

discharge, by Sublessor on any contiguous
or adjacent property to the Premises which Sublessor owns, operates and/or
leases.

 

(f)            In
no event shall termination, assignment or sub-subleasing of this Sublease
Agreement release Sublessor or Sublessee from the obligations set forth in this
paragraph.

 

31.           Captions. The captions contained in this Sublease
Agreement are for convenience of reference only, and in no way limit or enlarge
the terms and conditions of this Sublease Agreement.

 

32.           Miscellaneous.

 

(a)           Any  approval 
by  Sublessor  or  Landlord  or
Sublessor’s  or  Landlord’s 
architects  and/or engineers of
any of Sublessee’s drawings, plans and specifications which are prepared in
connection with any construction of improvements in the Premises shall not in
any way be construed or operate to bind Landlord or Sublessor in any way other
than as consent to the construction of said improvements, or to constitute a
representation or warranty of Landlord or Sublessor as to the adequacy or
sufficiency of such drawings, plans and specifications, or the improvements to
which they relate, for any use, purpose, or condition, but such approval shall
merely be the consent of Landlord or Sublessor as may be required hereunder in
connection with Sublessee’s construction of improvements in the Premises in
accordance with such drawings, plans and specifications.

 

(b)           There
shall be no merger of this Sublease Agreement or of the leasehold estate hereby
created with the fee estate in the Premises or any part thereof by reason of
the fact that the same person may acquire or hold, directly or indirectly, this
Sublease Agreement or the leasehold estate hereby created or any interest in
this Sublease Agreement or in such leasehold estate as well as the fee estate
in the leasehold Premises or any interest in such fee estate.

 

(c)           Neither
Sublessor nor Sublessor’s agents or brokers have made any representations or
promises with respect to the Premises, the buildings or the land except as
herein expressly set forth and no rights, easements or licenses are acquired by
Sublessee by implication or otherwise except as expressly set forth in the
provisions of this Sublease Agreement.

 

(d)           Sublessor
represents and warrants to Sublessee as follows: (i) the Main Lease is in full
force and effect and no default or event which, with the

 

18

 

passage of time or service of notice would
constitute a default, has occurred under the Main Lease; (ii) the consent of
Landlord to Sublease Agreement, if required, has been obtained; (iii) in the
event Sublessor obtains title to the Premises, Sublessee shall be granted the
right of first refusal to enter into a lease for the Premises for the same
terms and conditions contained in this Sublease Agreement; and (iv) in the
event Sublessor assigns/transfers this Sublease Agreement, the party to whom
the Sublease Agreement is assigned/transferred shall be financially sound and
have an industry rating equal to, or above, those like businesses within
Sublessor’s industry. Sublessor covenants that it will perform, comply with and
observe all of the terms, conditions and provisions of the Main Lease insofar
as they pertain to the portion of the property not subleased to Sublessee.
Sublessor shall defend indemnify and hold harmless Sublessee from and against
any and all claims, losses or damages resulting from any breach of the
representations, warranties and covenants of Sublessor as set forth in this
subparagraph 32(d).

 

(e)           Sublessee
represents and warrants that it will comply with all provisions of the Main
Lease as amended as it relates to the Premises, common areas and adjacent
buildings and areas and Sublessee shall defend, indemnify and hold harmless
Sublessor from and against any and all claims, losses or damages resulting from
any breach of the representations, warranties and covenants of Sublessee as set
forth in this subparagraph 32(e). Sublessor will provide Sublessee with copies
of any amendments and modifications to the Main Lease in a timely manner.

 

(f)            Sublessor
shall provide at no cost the same emergency ambulance and medical services to
Sublessee as it provides for its own employees, on an as needed basis.  The Parties further agree to indemnify each
other for any damages incurred by one Party as a result of the other Party’s
providing said services.

 

(g)           The
provisions of this Sublease Agreement shall apply to, and bind, the heirs,
successors, and administrators of the Parties.

 

(h)           In
the event Sublessor obtains an interest in the property (other than a leasehold
interest) as described in Exhibit A then, Sublessee agrees to enter into a
Direct Lease Agreement with Sublessor as Lessor and Sublessee as Lessee under
the same terms as this Sublease Agreement.

 

33.           Exhibits and Attachments.  All exhibits, attachments, riders and addenda referred to in this Sublease
Agreement

 

19

 

and the exhibits listed herein below are
incorporated into this Sublease Agreement and made a part hereof for all
intents and purposes.

 

Exhibit A - The Premises (with Attachment)

 

Exhibit B - Utility and Building
Responsibility of Sublessor

 

Exhibit C - Items Excluded from Operating
Expense Repair and Maintenance

 

Exhibit D - Operating Expenses

 

Exhibit E - Notice

 

Exhibit F - List of Hazardous Materials
used by Sublessor

 

Exhibit G - List of Hazardous Materials
used by Sublessee

 

Dated
as of the date first above written.

 

	
  SUBLESSOR

  	
  SUBLESSEE

  
	
   

  	
   

  
	
  Loral Vought Systems

  Corporation

  	
  Vought
  Aircraft Company

  
	
   

  	
   

  
	
   

  	
   

  
	
  /s/  [ILLEGIBLE]

  	
   

  	
  /s/ W.T. McMILLAN

  	
   

  
	
   

  	
   

  
	
  By

  	
  [ILLEGIBLE]

  	
   

  	
  By

  	
    W.T. McMILLAN

  	
   

  
	
  Title

  	
  SR VP & CFO

  	
   

  	
  Title

  	
  SR. V.P. & CFO

  	
   

  
	
   

  	
   

  
												

 

20

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