Document:

ex10-1.htm

    EXHIBIT
      10.1

       

       

      

       

      MULTICURRENCY

       

      REVOLVING
        CREDIT

       

      AND

       

      TERM
        LOAN AGREEMENT

       

      

       

      dated
        as of July 20, 2007

       

      by
        and among

       

      

       

      LOJACK
        CORPORATION,

       

      and
        the other Borrowers and Guarantors Party Hereto

       

      

       

      CITIZENS
        BANK OF MASSACHUSETTS

       

      as
        a Lender, Administrative Agent, Lead Arranger

       

      and
        Issuing Bank

       

      

       

      ROYAL
        BANK OF CANADA

       

      as
        the Canadian Lender

       

      

       

      and

       

      

       

      THE
        LENDING INSTITUTIONS PARTY HERETO

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      TABLE
        OF CONTENTS

       

      
        	
                §
                  1.

              	
                DEFINITIONS
                  AND RULES OF INTERPRETATION.

              	
                1

              
	
                §
                  1.1

              	
                Definitions.

              	
                1

              
	
                §
                  1.2

              	
                Rules
                  of Interpretation.

              	
                22

              
	
                §
                  1.3

              	
                Exchange
                  Rates; Currency.

              	
                22

              
	
                §
                  1.4

              	
                Additional
                  Alternative Currencies.

              	
                23

              
	
                §
                  1.5

              	
                Change
                  of Currency.

              	
                23

              
	
                §
                  2.

              	
                THE
                  MULTICURRENCY REVOLVING CREDIT FACILITY.

              	
                24

              
	
                §
                  2.1

              	
                The
                  Revolving Credit Facility.

              	
                24

              
	
                §
                  2.1.1

              	
                Commitment
                  to Lend Revolving Credit.

              	
                24

              
	
                §
                  2.1.2

              	
                Termination
                  or Reduction of Revolving Credit Commitment.

              	
                25

              
	
                §
                  2.1.3

              	
                The
                  Revolving Credit Notes.

              	
                25

              
	
                §
                  2.1.4

              	
                Requests
                  for Revolving Credit Loans.

              	
                25

              
	
                §
                  2.1.5

              	
                Funds
                  for Revolving Credit Loans.

              	
                26

              
	
                §
                  2.1.6

              	
                Maturity
                  of the Revolving Credit Loans.

              	
                27

              
	
                §
                  2.1.7

              	
                Mandatory
                  Repayments of the Revolving Credit Loans.

              	
                27

              
	
                §
                  2.1.8

              	
                Increase
                  in Revolving Credit Commitment.

              	
                27

              
	
                §
                  2.1.9

              	
                Designation
                  of Foreign Borrowers.

              	
                28

              
	
                §
                  2.2

              	
                Letters
                  of Credit.

              	
                28

              
	
                §
                  2.2.1

              	
                Letters
                  of Credit Commitment.

              	
                28

              
	
                §
                  2.2.2

              	
                Procedures
                  for Issuance and Amendment of Letters of Credit; Auto-Renewal Letters
                  of
                  Credit.

              	
                30

              
	
                §
                  2.2.3

              	
                Drawings
                  and Reimbursements of Letters of Credit; Funding and Repayment
                  of
                  Participations.

              	
                31

              
	
                §
                  2.2.4

              	
                Letters
                  of Credit Obligations Absolute.

              	
                32

              
	
                §
                  2.2.5

              	
                Role
                  of Issuing Bank with Letters of Credit.

              	
                33

              
	
                §
                  2.2.6

              	
                Cash
                  Collateral for Letters of Credit.

              	
                34

              
	
                §
                  2.2.7

              	
                Applicability
                  of ISP98 and UCP to Letters of Credit.

              	
                34

              
	
                §
                  2.2.8

              	
                Letter
                  of Credit Fees.

              	
                34

              
	
                §
                  2.2.9

              	
                Documentary
                  and Processing Charges Payable to Issuing Bank for Letters of
                  Credit.

              	
                34

              
	
                §
                  2.2.10

              	
                Conflict
                  with Letter of Credit Application.

              	
                35

              
	
                §
                  2.3

              	
                Swing
                  Line Facility.

              	
                35

              
	
                §
                  3.

              	
                THE
                  CANADIAN CREDIT FACILITY.

              	
                35

              
	
                §
                  3.1

              	
                Definitions;
                  Schedules.

              	
                35

              

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

      
        	
                §
                  3.2

              	
                The
                  Canadian Credit Facility.

              	
                36

              
	
                §
                  3.3

              	
                [Reserved]

              	
                36

              
	
                §
                  3.4

              	
                Availability;
                  Repayment.

              	
                36

              
	
                §
                  3.5

              	
                Interest
                  Rates and Fees.

              	
                36

              
	
                §
                  3.6

              	
                Evidence
                  of Indebtedness.

              	
                38

              
	
                §
                  3.7

              	
                General
                  Account.

              	
                38

              
	
                §
                  3.8

              	
                Exchange
                  Rate Fluctuations

              	
                39

              
	
                §
                  3.9

              	
                Indemnity

              	
                39

              
	
                §
                  4.

              	
                THE
                  TERM LOAN.

              	
                39

              
	
                §
                  4.1

              	
                The
                  Term Loan; Commitment to Lend Term Loan.

              	
                39

              
	
                §
                  4.2

              	
                The
                  Term Notes.

              	
                40

              
	
                §
                  4.3

              	
                Maturity
                  of the Term Loan.

              	
                40

              
	
                §
                  4.4

              	
                [Reserved.]

              	
                40

              
	
                §
                  4.5

              	
                Interest
                  on Term Loan.

              	
                40

              
	
                §
                  4.6

              	
                5/25
                  Savings Clause.

              	
                40

              
	
                §
                  5.

              	
                PROVISIONS
                  RELATING TO ALL LOANS.

              	
                41

              
	
                §
                  5.1

              	
                Interest
                  on Loans.

              	
                41

              
	
                §
                  5.2

              	
                Election
                  of Interest Rate; Notice of Election; Interest Periods; Minimum
                  Amounts.

              	
                41

              
	
                §
                  5.3

              	
                Optional
                  Prepayments or Repayments of the Loans.

              	
                42

              
	
                §
                  5.4

              	
                Fees.

              	
                42

              
	
                §
                  5.5

              	
                Payments.

              	
                43

              
	
                §
                  5.6

              	
                Computations.

              	
                43

              
	
                §
                  5.7

              	
                Interest
                  on Overdue Amounts; Default Rate.

              	
                44

              
	
                §
                  5.8

              	
                Interest
                  Limitation.

              	
                44

              
	
                §
                  5.9

              	
                Funding
                  Losses.

              	
                44

              
	
                §
                  5.10

              	
                Illegality.

              	
                45

              
	
                §
                  5.11

              	
                Inability
                  to Determine Eurodollar Rate or CDOR Rate.

              	
                45

              
	
                §
                  5.12

              	
                Increased
                  Costs.

              	
                46

              
	
                §
                  5.13

              	
                Taxes.

              	
                47

              
	
                §
                  5.14

              	
                Mitigation
                  Obligations; Replacement of Lenders.

              	
                49

              
	
                §
                  6.

              	
                CONDITIONS
                  PRECEDENT TO CREDIT EXTENSIONS.

              	
                50

              
	
                §
                  6.1

              	
                Conditions
                  to All Credit Extensions.

              	
                50

              
	
                §
                  6.2

              	
                Conditions
                  to Initial Credit Extension.

              	
                50

              

      

      
        
          
          

        

        
          -3-

          
            

          

        

        
          
          

        

      

      

      
        	
                §
                  7.

              	
                REPRESENTATIONS
                  AND WARRANTIES

              	
                51

              
	
                §
                  7.1

              	
                Organization
                  and Qualification.

              	
                51

              
	
                §
                  7.2

              	
                Subsidiaries.

              	
                52

              
	
                §
                  7.3

              	
                Authority
                  and Validity of Obligations.

              	
                52

              
	
                §
                  7.4

              	
                Use
                  of Proceeds; Margin Stock.

              	
                52

              
	
                §
                  7.5

              	
                Financial
                  Reports.

              	
                53

              
	
                §
                  7.6

              	
                No
                  Material Adverse Change.

              	
                53

              
	
                §
                  7.7

              	
                Full
                  Disclosure.

              	
                53

              
	
                §
                  7.8

              	
                Trademarks,
                  Franchises, and Licenses.

              	
                53

              
	
                §
                  7.9

              	
                Governmental
                  Authority and Licensing.

              	
                54

              
	
                §
                  7.10

              	
                Good
                  Title.

              	
                54

              
	
                §
                  7.11

              	
                Litigation
                  and Other Controversies.

              	
                54

              
	
                §
                  7.12

              	
                Taxes.

              	
                54

              
	
                §
                  7.13

              	
                Approvals.

              	
                54

              
	
                §
                  7.14

              	
                Affiliate
                  Transactions.

              	
                55

              
	
                §
                  7.15

              	
                Investment
                  Company; Public Utility Holding Company.

              	
                55

              
	
                §
                  7.16

              	
                ERISA.

              	
                55

              
	
                §
                  7.17

              	
                Compliance
                  with Laws.

              	
                55

              
	
                §
                  7.18

              	
                Other
                  Agreements.

              	
                55

              
	
                §
                  7.19

              	
                No
                  Default.

              	
                55

              
	
                §
                  8.

              	
                AFFIRMATIVE
                  COVENANTS.

              	
                56

              
	
                §
                  8.1

              	
                Maintenance
                  of Business.

              	
                56

              
	
                §
                  8.2

              	
                Maintenance
                  of Properties.

              	
                56

              
	
                §
                  8.3

              	
                Taxes
                  and Assessments.

              	
                56

              
	
                §
                  8.4

              	
                Insurance.

              	
                56

              
	
                §
                  8.5

              	
                Financial
                  Reports.

              	
                56

              
	
                §
                  8.6

              	
                Inspection.

              	
                57

              
	
                §
                  8.7

              	
                ERISA.

              	
                58

              
	
                §
                  8.8

              	
                Compliance
                  with Laws.

              	
                58

              
	
                §
                  8.9

              	
                Formation
                  of Subsidiaries.

              	
                58

              
	
                §
                  8.10

              	
                Use
                  of Proceeds.

              	
                59

              
	
                §
                  8.11

              	
                Insolvency
                  Applications.

              	
                59

              
	
                §
                  9.

              	
                NEGATIVE
                  COVENANTS.

              	
                59

              
	
                §
                  9.1

              	
                Borrowings
                  and Guaranties.

              	
                59

              

      

      
        
          
          

        

        
          -4-

          
            

          

        

        
          
          

        

      

      

      
        	
                §
                  9.2

              	
                Liens.

              	
                60

              
	
                §
                  9.3

              	
                Investments.

              	
                61

              
	
                §
                  9.4

              	
                Mergers,
                  Consolidations and Sales and Acquisitions.

              	
                62

              
	
                §
                  9.5

              	
                [Reserved].

              	
                62

              
	
                §
                  9.6

              	
                Burdensome
                  Contracts With Affiliates.

              	
                62

              
	
                §
                  9.7

              	
                No
                  Changes in Fiscal Year.

              	
                62

              
	
                §
                  9.8

              	
                Change
                  in the Nature of Business.

              	
                63

              
	
                §
                  9.9

              	
                No
                  Restrictions.

              	
                63

              
	
                §
                  9.10

              	
                No
                  Stock Repurchase.

              	
                63

              
	
                §
                  10.

              	
                FINANCIAL
                  COVENANTS.

              	
                63

              
	
                §
                  10.1

              	
                Fixed
                  Charge Coverage Ratio.

              	
                63

              
	
                §
                  10.2

              	
                Funded
                  Debt to EBITDA Ratio.

              	
                63

              
	
                §
                  10.3

              	
                Capital
                  Expenditures.

              	
                64

              
	
                §
                  11.

              	
                GUARANTIES;
                  PLEDGE OF CERTAIN STOCK.

              	
                64

              
	
                §
                  11.1

              	
                Guaranties.

              	
                64

              
	
                §
                  11.2

              	
                Pledge
                  of Stock of LoJack Equipment Ireland Limited

              	
                65

              
	
                §
                  11.3

              	
                Further
                  Assurances

              	
                66

              
	
                §
                  12.

              	
                EVENTS
                  OF DEFAULT; ACCELERATION.

              	
                66

              
	
                §
                  12.1

              	
                Events
                  of Default and Acceleration.

              	
                66

              
	
                §
                  12.2

              	
                Remedies
                  Upon Event of Default.

              	
                68

              
	
                §
                  12.3

              	
                Judgment
                  Currency.

              	
                68

              
	
                §
                  12.4

              	
                Distribution
                  of Collateral Proceeds.

              	
                69

              
	
                §
                  13.

              	
                ADMINISTRATIVE
                  AGENT.

              	
                69

              
	
                §
                  13.1

              	
                Appointment
                  and Authority.

              	
                69

              
	
                §
                  13.2

              	
                Rights
                  as Lender.

              	
                69

              
	
                §
                  13.3

              	
                Exculpatory
                  Provisions.

              	
                70

              
	
                §
                  13.4

              	
                Reliance
                  by Administrative Agent.

              	
                70

              
	
                §
                  13.5

              	
                Delegation
                  of Duties.

              	
                71

              
	
                §
                  13.6

              	
                Resignation
                  of Administrative Agent.

              	
                71

              
	
                §
                  13.7

              	
                Non-Reliance
                  on Administrative Agent and the Other Lenders.

              	
                72

              
	
                §
                  13.8

              	
                No
                  Other Duties, etc.

              	
                72

              
	
                §
                  13.9

              	
                Payments
                  to Administrative Agent

              	
                72

              
	
                §
                  14.

              	
                MISCELLANEOUS.

              	
                72

              

      

      
        
          
          

        

        
          -5-

          
            

          

        

        
          
          

        

      

      

      
        	
                §
                  14.1

              	
                Setoff
                  Rights.

              	
                72

              
	
                §
                  14.2

              	
                Attorney
                  Costs; Expenses.

              	
                73

              
	
                §
                  14.3

              	
                Indemnification.

              	
                73

              
	
                §
                  14.4

              	
                Representations
                  and Warranties.

              	
                74

              
	
                §
                  14.5

              	
                Payments;
                  Set Aside.

              	
                74

              
	
                §
                  14.6

              	
                Successors
                  and Assigns; Participations.

              	
                74

              
	
                §
                  14.7

              	
                Notices
                  and Other Communications; Facsimile Copies.

              	
                77

              
	
                §
                  14.8

              	
                Cumulative
                  Remedies; Captions; Counterparts.

              	
                78

              
	
                §
                  14.9

              	
                USA
                  Patriot Act Notice.

              	
                78

              
	
                §
                  14.10

              	
                Entire
                  Agreement; Etc.

              	
                78

              
	
                §
                  14.11

              	
                Consents;
                  Amendments; Waivers; Etc.

              	
                79

              
	
                §
                  14.12

              	
                Concerning
                  Joint and Several Liability.

              	
                79

              
	
                §
                  14.13

              	
                Governing
                  Law.

              	
                82

              
	
                §
                  14.14

              	
                Waiver
                  of Jury Trial.

              	
                83

              
	
                §
                  14.15

              	
                Severability.

              	
                83

              
	 	 	 

      

      

      
        
          
          

        

        
          -6-

          
            

          

        

        
          
          

        

      

      EXHIBITS

      

      
        	
                EXHIBIT
                  A

              	
                Form
                  of Assumption and Assignment

              
	
                EXHIBIT
                  B

              	
                Form
                  of Revolving Credit Loan Request

              
	
                EXHIBIT
                  C

              	
                Form
                  of Canadian Revolving Credit Loan Request

              
	
                EXHIBIT
                  D

              	
                Form
                  of Swing Line Loan Request

              
	
                EXHIBIT
                  E

              	
                Form
                  of Compliance Certificate

              
	
                EXHIBIT
                  F

              	
                Form
                  of Instrument of Accession

              
	
                EXHIBIT
                  G

              	
                Form
                  of Joinder Agreement

              

      

      

      

      SCHEDULES

      

      
        	
                SCHEDULE
                  1

              	
                Subsidiaries
                  and Affiliates

              
	
                SCHEDULE
                  2

              	
                Lenders;
                  Commitments; Applicable Percentages

              
	
                SCHEDULE
                  3

              	
                Lending
                  Offices

              
	
                SCHEDULE
                  3.1-A

              	
                Additional
                  Definitions for Canadian Credit Facility

              
	
                SCHEDULE
                  3.1-B

              	
                Borrowing
                  Conditions Under Canadian Credit Facility

              
	
                SCHEDULE
                  4

              	
                Mandatory
                  Cost

              
	
                SCHEDULE
                  7.2

              	
                Subsidiaries;
                  Capitalization

              
	
                SCHEDULE
                  9.1

              	
                Indebtedness

              
	
                SCHEDULE
                  9.2

              	
                Liens

              
	
                SCHEDULE
                  14.7

              	
                Addresses
                  for Notices

              

      

      

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      MULTICURRENCY
        REVOLVING CREDIT AND TERM LOAN AGREEMENT

       

      This
        MULTICURRENCY REVOLVING CREDIT AND TERM LOAN AGREEMENT is made as of the
        20th day of
        July 2007
        (the “Credit Agreement” or this “Agreement”), by and among LOJACK
        CORPORATION, a corporation organized under the laws of the Commonwealth of
        Massachusetts (“LoJack”), the Canadian Borrowers and Foreign Borrowers
        listed on Schedule 1 attached hereto (collectively with LoJack, and
        together with the other Persons that from time to time become Borrowers pursuant
        to the provisions hereof, the “Borrowers”), the U.S. Guarantors and
        Canadian Guarantors listed on Schedule 1 attached hereto (collectively
        with the other Persons that from time to time become U.S. Guarantors or Canadian
        Guarantors pursuant to the provisions hereof, the “Guarantors”), the
        Lenders (as hereinafter defined), CITIZENS BANK OF MASSACHUSETTS, a
        Massachusetts banking corporation, as Administrative Agent for itself and
        each
        of the other Lenders from time to time party to this Agreement, Lead Arranger
        and Issuing Bank, and ROYAL BANK OF CANADA, a Canadian chartered bank, as
        the
        Canadian Lender.

       

      §
        1.  DEFINITIONS AND RULES OF INTERPRETATION.

       

      §
        1.1  Definitions.

       

      Schedule
        3.1-A contains definitions of capitalized terms used in §3 and
        not
        otherwise defined in this Credit Agreement.  The following terms shall
        have the meanings set forth in this §1 or elsewhere in the provisions of this
        Credit Agreement referred to below:

       

      5/25
        Compliant Term Loan.  Means Indebtedness, the interest of which is
        not subject to Part XIII tax pursuant to subparagraph 212(b)(vii) of the
        Income
        Tax Act (Canada).

       

      Acceding Lender.   Has
        the meaning set forth in § 2.1.8(c).

       

      Accountants.  Has
        the meaning set forth in §8.4(a).

       

      Acquired
        EBITDA. Means, with respect to any Acquired Entity or
        Business for any period, the amount for such period of Consolidated EBITDA
        of
        such Acquired Entity or Business (determined as if references to the Borrowers
        and their Subsidiaries in the definition of Consolidated EBITDA were references
        to such Acquired Entity or Business and its Subsidiaries), all as determined
        on
        a consolidated basis for such Acquired Entity or Business.

       

      Acquired
        Entity or Business.  Any Person, property, business or asset
        acquired by the Borrowers or any Subsidiary during such period in connection
        with any Permitted Acquisition (but not the Acquired EBITDA of any related
        Person, property, business or assets to the extent not so
        acquired).

       

      Additional
        Pledge Agreement.  Has the meaning set forth in
§ 11.2(b).

       

      Additional
        Pledged Equity.  Has the meaning set forth in
§ 11.2(b).

       

      Additional
        Pledged Foreign Subsidiary.  Has the meaning set forth in
§ 11.2(b).

       

      Adjustment
        Date.  The first day of the month immediately following the month
        in which a Compliance Certificate is to be delivered by the Borrowers pursuant
        to §8.5(h).

       

      Adjusted
        Eurodollar Rate.  Means, relative to any Eurodollar Rate Loan to
        be made, continued or maintained as, or converted into, a Eurodollar Rate
        Loan
        for any Interest Period, a rate per annum

       

      
        
          
          

        

        
          -1-

          
            

          

        

        
          
          

        

      

      (rounded
        upwards if necessary, to the 1/16 of 1%) equal to the sum of (a) (i) the
        Eurodollar Rate for such Interest Period divided by (y) a percentage
        equal to one hundred percent (100%) minus the Eurodollar Reserve Percentage,
        plus (b) in the case of Loans by a Lender from its office or branch in
        the United Kingdom (except for Loans to any U.S. Borrowers denominated in
        Dollars), the Mandatory Cost.

       

      Administrative
        Agent.  Means Citizens Bank of Massachusetts in its capacity as
        administrative agent under any of the Loan Documents, or any successor
        administrative agent.

       

      Affiliate.
        Means with respect to any Person, another Person that directly, or indirectly
        through one or more intermediaries, Controls or is Controlled by or is under
        common Control with the Person specified.  Without limiting the
        generality of the foregoing, a Person shall be deemed to be an Affiliate
        if such
        other Person possesses, directly or indirectly, power to vote ten (10%) percent
        or more of the securities having ordinary voting power for the election of
        directors, managing general partners or the equivalent.

       

      Agreement.  Means
        this Credit Agreement, including the Schedules and Exhibits hereto.

       

      Agreement
        Currency.  Has the meaning set forth in §12.3.

       

      Aggregate
        Commitments.  Means the sum of all of the
        Commitments.

       

      Alternative
        Currency.  Means Euros, British Pounds Sterling, Yen and any other
        major foreign currency acceptable to the Lenders.

       

      Alternative
        Currency Equivalent.  Means, at any time, with respect to any
        amount denominated in U.S. Dollars, the equivalent amount thereof in the
        applicable Alternative Currency as determined by the Administrative Agent,
        at
        such time on the basis of the Spot Rate (determined in respect of the most
        recent Revaluation Date) for the purchase of such Alternative Currency with
        U.S.
        Dollars.

       

      Alternative
        Currency Sublimit.  Means, as of the Closing Date, the Dollar
        Equivalent of Fifty Million Dollars ($50,000,000).

       

      Approved
        Fund.  Means any Fund that is administered or managed by (a) the
        Lender or (b) an Affiliate of the Lender.

       

      Applicable
        Percentage.  Means, as the context requires, (i) with respect to
        the Aggregate Commitments, each Lender’s percentage share of the Aggregate
        Commitments, (ii) with respect to the Revolving Credit Loans, each Lender's
        percentage share of the Revolving Credit Commitment, (iii) with respect to
        the
        Letters of Credit, each Revolving Credit Lender’s percentage share of the L/C
        Obligations, L/C Advances and L/C Borrowings, and (iv) with respect to the
        Term
        Loan, each Term Loan Lender’s percentage of the Term Loan, as each of the
        foregoing items (i) - (iv) is set forth immediately opposite such Lender's
        name
        on Schedule 2 hereto.

       

      Applicable
        Margin.  For each period commencing on an Adjustment Date through
        the date immediately preceding the next Adjustment Date (each a “Rate Adjustment
        Period”), the Applicable Margin shall be the applicable margin set forth below
        with respect to the Consolidated Funded Debt to Consolidated EBITDA Ratio,
        as
        determined for the Reference Period of the Borrowers and their Subsidiaries
        ending on the fiscal quarter ended immediately prior to the applicable Rate
        Adjustment Period:

       

      
        
          
          

        

        
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                Level

              	
                Consolidated
                  Funded Debt to Consolidated EBITDA Ratio

              	
                Applicable
                  Margin For Eurodollar Rate Loans, CDOR Rate Loans, Libor Loans
                  or
                  BAs

              	
                Commitment
                  Fee

              	
                Standby
                  Letter of Credit, LC or LG Fee

              
	
                I

              	
                ­<
                  1.00:1

              	
                0.500%

              	
                0.125%

              	
                0.500%

              
	
                II

              	
                >
                  1.00:1, but < 1.75:1

              	
                0.625%

              	
                0.150%

              	
                0.625%

              
	
                III

              	
                >
                  1.75:1, but < 2.00:1

              	
                0.750%

              	
                0.200%

              	
                0.750%

              
	
                IV

              	
                >
                  2.00:1

              	
                0.875%

              	
                0.250%

              	
                0.875%

              

      

      

       

      Notwithstanding
        the foregoing, (a) for the Loans and BAs outstanding and the Letter of Credit,
        LC, and LG Fees and the Commitment Fee payable during the period commencing
        on
        the Closing Date through the date immediately preceding the first Adjustment
        Date to occur after the fiscal quarter ending September 30, 2007, the Applicable
        Margin shall be the Applicable Margin set forth in Level I above.  In
        the event that the Compliance Certificate required to be delivered pursuant
        to
§8.4(c) is not delivered when due, then during the period from the next Business
        Day after the date on which such financial statements was required to be
        delivered until the next Business Day after the Compliance Certificate is
        delivered by the Borrowers to the Administrative Agent, the “Applicable Margin”
shall be deemed to be the highest percentage set forth in the above
        table.

       

      Assignment
        and Assumption.  Means an assignment and assumption entered into
        by a Lender and an Eligible Assignee (with the consent of any party whose
        consent is required by §14.6), and accepted by the Administrative Agent, in
        substantially the form of Exhibit A or any other form approved by the
        Administrative Agent.

       

      Attorney
        Costs.  Means all reasonable fees, expenses and disbursements of
        any law firm or other external counsel incurred by the Administrative
        Agent.

       

      Auto-Renewal
        Letter of Credit.  Has the meaning set forth in
§2.2.2(c).

       

      Available
        Revolving Credit Commitment.  Means, at any time, the
        Aggregate Commitments in respect of the Revolving Credit Facility then in
        effect
minus the Revolving Credit Exposure at such time.   For
        purposes of calculating the Available Revolving Credit Commitment with respect
        to Loans in Alternative Currencies, the Administrative Agent shall use the
        Dollar Equivalent of such Alternative Currency, calculated on the basis of
        the
        Spot Rate for such Alternative Currency, on or as of the most recent Revaluation
        Date provided for in § 1.3(a).

       

      Bank
        Product Obligations.  Every obligation of each Borrower and its
        Subsidiaries under and in respect of any one or more of the following types
        of
        services or facilities extended to such Borrower or such Subsidiary by the
        Lender or Affiliate of the Lender:  (i) credit and purchase cards,
        (ii) cash management or related services, including, without limitation,
        controlled disbursement services, and (iii)  agreements for treasury
        management services, including, without limitation, intraday credit, Automated
        Clearing House (ACH) services, foreign exchange services, daylight overdrafts
        and zero balance arrangements.

       

      Base
        Rate.  Means a rate per annum equal to the rate of interest
        announced by the Administrative Agent in Boston, Massachusetts from time
        to time
        as its “Prime Rate.”  Any change in the Base Rate shall be effective
        immediately from and after such change in the Base Rate. Interest accruing
        by
        reference to the Base Rate shall be calculated on the basis of actual days
        elapsed and a 360-day year.  The Borrowers

       

      
        
          
          

        

        
          -3-

          
            

          

        

        
          
          

        

      

      acknowledge
        that the Administrative Agent may make loans to its customers above, at or
        below
        the Base Rate.

       

      Base
        Rate Loans.  Means the Revolving Credit Loans bearing interest
        calculated by reference to the Base Rate.

       

      Borrowers.  Has
        the meaning set forth in the Preamble.

       

      Business
        Day.  Means any day that is not a Saturday, Sunday or other day on
        which commercial banks in Boston, Massachusetts are authorized or required
        by
        law to remain closed; provided that, (a) when used in connection with
        CDOR Rate Loans or Canadian Base Rate Loans, the term “Business Day” shall also
        exclude any day on which banks are not open for dealings in Canadian Dollars
        in
        Toronto, Ontario, and (b) when used in connection with a Eurodollar Rate
        Loan
        denominated in any Alternative Currency, the term “Business Day” shall also
        exclude any day on which banks are not open for dealings in such Alternative
        Currency in the London interbank market or the principal financial center
        of the
        country in which payment or purchase of such Alternative Currency can be
        made
        (and, if the Loan or Letters of Credit which are the subject of a borrowing,
        drawing, payment, reimbursement or rate selection are denominated in Euro,
        the
        term “Business Day” shall also exclude any day on which the TARGET payment
        system is not open for the settlement of payments in euro).

       

      Canadian
        Base Rate.  Means for any day the greater of: (i) the floating
        annual rate of interest appearing on Bloomberg Canada-Govt’s & Money Market
        Rates, as in effect on such day; and (ii) the CDOR Rate applicable on such
        day
        plus 1.0%.

       

      Canadian
        Base Rate Loans.  Means Canadian Revolving Credit Loans and all or
        any portion of the Term Loan bearing interest calculated by reference to
        the
        Canadian Base Rate.

       

      Canadian
        Borrowers.  Means any Borrower that is organized under the laws of
        Canada or any state or province thereof now existing or formed after the
        date
        hereof and is listed on Schedule 1 hereto on the day hereof or has been
        designated as a Canadian Borrower pursuant to §8.9(b).

       

      Canadian
        Dollars or Can. $.  Means dollars in lawful currency of
        Canada.

       

      Canadian
        CDOR Rate Loans.  Means Revolving Credit Loans and all or any
        portion of the Term Loan bearing interest calculated by reference to the
        CDOR
        Rate.

       

      Canadian
        Credit Facility.  Has the meaning set forth in
§ 3.2.

       

      Canadian
        Guarantor.  Means any Subsidiary of LoJack that (a) is not a
        Canadian Borrower, and (b) is organized under the laws of Canada or any province
        thereof now existing or formed after the date hereof (but excluding, in any
        event, Vehicle Recovery Systems Company, a Nova Scotia company).

       

      Canadian
        Lender.  Means, as of the Closing Date, Royal Bank of Canada, in
        its capacity as the revolving lender under the Canadian Credit Facility,
        or any
        successor thereto.

       

      Canadian
        Obligations.  Means all indebtedness, obligations and liabilities
        of the Canadian Borrowers to the Administrative Agent and applicable Lenders
        existing on the date of this Agreement or arising thereafter, direct or
        indirect, joint or several, absolute or contingent, matured or unmatured,
        liquidated or unliquidated, secured or unsecured, arising by contract, operation
        of law or otherwise, arising or incurred under this Agreement or any of the
        other Loan Documents in respect of the Term Loan, the Term Notes, the Canadian
        Credit Facility, any Swap Contract with any Lenders or any
        Affiliate

       

      
        
          
          

        

        
          -4-

          
            

          

        

        
          
          

        

      

      thereof,
        and any Bank Product Obligations (in either case entered into by a Canadian
        Borrower) or any other instrument at any time evidencing any thereof, the
        whole
        including for greater certainty the Canadian Revolving Obligations.

       

      Canadian
        Revolving Borrower.  Means any Canadian Borrower which is an
        obligor with respect to Canadian Revolving Credit Loans.

       

      Canadian
        Revolving Credit Commitment. Means, as of the Closing Date, Five Million
        Canadian Dollars (Can.$5,000,000) or the Equivalent Amount (as such expression
        is defined in Schedule 3.1-A) thereof in Dollars.

       

      Canadian
        Revolving Credit Loans. Means revolving credit loans made or to be made by
        the Canadian Lender to the Canadian Revolving Borrowers under the Canadian
        Credit Facility including for greater certainty all extensions of credit
        thereunder by the Canadian Lender by way of Bankers’ Acceptances, LCs and
        LGs.

       

      Canadian
        Revolving Obligations.  Means any and all indebtedness,
        obligations and liabilities of the Canadian Revolving Borrowers to the Canadian
        Lender arising under the Canadian Credit Facility existing on the date of
        this
        Agreement or arising thereafter, direct or indirect, joint or several, absolute
        or contingent, matured or unmatured, liquidated or unliquidated, secured
        or
        unsecured, arising by contract, operation of law or otherwise, arising or
        incurred under this Agreement or any of the other Loan Documents or in respect
        of the Canadian Revolving Credit Loans or any other instrument at any time
        evidencing any thereof.

       

      Canadian
        Subsidiary.  Means any Subsidiary that is organized under the laws
        of Canada or any province thereof now existing or formed after the date
        hereof.

       

      Capital
        Assets.  Means fixed assets, both tangible (such as land,
        buildings, fixtures, machinery and equipment) and intangible (such as patents,
        copyrights, trademarks, franchises and good will).

       

      Capital
        Expenditures.  Means amounts paid or indebtedness incurred by any
        Person in connection with the purchase or lease by such Person of Capital
        Assets
        that would be required to be capitalized and shown on the balance sheet of
        such
        Person in accordance with GAAP.

       

      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)
        and any and all warrants, rights or options to purchase any of the
        foregoing.

       

      Cash
        Collateralize.  Means, with respect to any Letter of Credit, to
        pledge and deposit with or to the Administrative Agent, for the benefit of
        the
        Issuing Bank or, as the case may be, the Canadian Lender, cash as collateral
        for
        the L/C Obligations pursuant to documentation in form and substance satisfactory
        to the Administrative Agent and the Issuing Bank or, as the case may be,
        the
        Canadian Lender.

       

      CDOR
        Rate.  Means, with respect to a CDOR Rate Loan for the relevant
        CDOR Interest Period, the Canadian deposit offered rate which, in turn means
        on
        any day the sum of: (a) the annual rate of interest which is the rate determined
        as being the arithmetic average of the quotations of all institutions listed
        in
        respect of the relevant CDOR Interest Period for Canadian dollar denominated
        bankers’ acceptances displayed and identified as such on the “Reuters Screen
        CDOR Page” as defined in the International Swap Dealer Association, Inc.
        definitions, as modified and amended from time to time, as of 10:00 a.m.
        Toronto, Ontario local time on such day and, if such day is not a Business
        Day,
        then on the immediately preceding Business Day (as adjusted by the Lender
        after
        10:00 a.m. Toronto, Ontario local

       

      
        
          
          

        

        
          -5-

          
            

          

        

        
          
          

        

      

      time
        to
        reflect any error in the posted rate of interest or in the posted average
        annual
        rate of interest) plus 10 basis points.

       

      Change
        of Control.  Means any of (a) the acquisition by any “person” or
“group” (as such terms are used in sections 13(d) and 14(d) of the Securities
        Exchange Act of 1934, as amended) at any time of beneficial ownership of
        40% or
        more of the outstanding capital stock or other equity interests of LoJack
        on a
        fully-diluted basis, or (b) the failure of individuals who are members of
        the
        board of directors (or similar governing body) of LoJack on the Closing Date
        (together with any new or replacement directors whose initial nomination
        for
        election was approved by a majority of the directors who were either directors
        on the Closing Date or previously so approved) to constitute a majority of
        the
        board of directors (or similar governing body) of LoJack.

       

      Change
        in Law.  Means the occurrence, after the date of this Agreement,
        of any of the following: (a) the adoption or taking effect of any law,
        rule, regulation or treaty, (b) any change in any law, rule, regulation or
        treaty or in the administration, interpretation or application thereof by
        any
        Governmental Authority or (c) the making or issuance of any request,
        guideline or directive (whether or not having the force of law) by any
        Governmental Authority.

       

      Closing
        Date.  Means the date of this Agreement or such later Business Day
        upon which each condition described in § 6 shall have been satisfied in a manner
        satisfactory to or waived by the Administrative Agent in its sole
        discretion.

       

      Commitment.  Means
        each Revolving Credit Lender’s and the Canadian Lender’s commitment to make, as
        applicable, Revolving Credit Loans or Canadian Revolving Credit Loans to
        the
        applicable Borrowers and participate in the issuance, extension and renewal
        of
        Letters of Credit, as set forth in §§ 2 and 3 hereof in an aggregate amount, at
        any one time outstanding, not to exceed the amount set forth with respect
        to
        such Lender in Schedule 2 hereto or in the Assignment and Assumption
        pursuant to which such Lender becomes a party hereto, as applicable, as such
        amount may be adjusted from time to time in accordance with this
        Agreement.

       

      Commitment
        Fee.  Has the meaning set forth in § 5.4(b).

       

      Compliance
        Certificate.  Has the meaning set forth in § 8.5(e).

       

      Consolidated
        or consolidated.  Means, with reference to any term defined
        herein, that term as applied to the accounts of LoJack and its Subsidiaries
        consolidated in accordance with GAAP.

       

      Consolidated
        Capital Expenditures.  Means the amount expended by the Borrowers
        and their Subsidiaries on a consolidated basis for Capital Expenditures,
        exclusive of any amounts paid for Permitted Acquisitions.

       

      Consolidated
        EBITDA.  Means, for any period, for the Borrowers and their
        Subsidiaries on a consolidated basis, an amount equal to Consolidated Net
        Income
        for such period

       

      plus:
        (a) the following to the extent deducted in calculating such Consolidated
        Net
        Income:

       

      (i)
        consolidated interest charges for such period,

       

      (ii)
        the
        provision for federal, state, provincial, local and foreign income taxes
        payable
        by the Borrowers and their Subsidiaries for such period,

       

      
        
          
          

        

        
          -6-

          
            

          

        

        
          
          

        

      

      (iii)
        the
        amount of depreciation and amortization expense deducted in determining such
        Consolidated Net Income,

       

      (iv)  non-cash
        charges for stock based compensation,

       

      (v)
        non-cash extraordinary and unusual or non-recurring writedowns or writeoffs
        of
        (A) intangible assets of Boomerang Tracking Inc. and (B) other non-current
        assets not to exceed the Dollar Equivalent of $7,500,000 in the
        aggregate,

       

      minus
        (b)  any extraordinary , unusual,  non-recurring or
        non-operating gains;

       

      all
        calculated for the Borrower and its Subsidiaries in accordance with GAAP
        on a
        consolidated basis.

       

       For
        the purposes of determining Consolidated EBITDA for any period in which a
        Permitted Acquisition of an Acquired Entity or Business or a Material
        Divestiture has occurred, Consolidated EBITDA may at the discretion of LoJack
        in
        the case of a Permitted Acquisition and shall in the case of any Material
        Divestiture, be adjusted (without duplication) (A) to include the Acquired
        EBITDA of such Acquired Entity or Business during such period (based on the
        actual Acquired EBITDA of such Acquired Entity or Business for such period
        (including the portion thereof occurring prior to such acquisition)), and
        (B)
        subject to the written consent of the Required Lenders, an amount equal to
        the
        Pro Forma Adjustment with respect to such Acquired Entity or Business for
        such
        period (including the portion thereof occurring prior to such acquisition)
        as
        specified in a certificate executed by a Responsible Officer and delivered
        to
        the Lenders and the Administrative Agent, and (C) in the case of a Material
        Divestiture, a corresponding reduction to Consolidated EBITDA for the portion
        attributable to the Material Divestiture and previously included in Consolidated
        EBITDA during the reporting period.

       

      Consolidated
        Fixed Charges.  Means, for any period, Consolidated Total Interest
        Expense for such period plus principal required to be paid on Indebtedness
        of
        the Borrowers and their Subsidiaries on a consolidated basis during such
        period
        plus all dividends paid in cash by LoJack and cash taxes.

       

      Consolidated
        Funded Debt. Means, as of any date of determination, for the Borrowers and
        their Subsidiaries on a consolidated basis, the sum of (a) the outstanding
        principal amount of all obligations, whether current or long-term, for borrowed
        money (including the Obligations hereunder, but excluding in any event the
        net
        obligations of the Borrowers under any Swap Contract) and all obligations
        evidenced by bonds, debentures, notes, loan agreements or other similar
        instruments, (b) all purchase money Indebtedness, (c) all direct obligations
        arising under letters of credit (including standby and commercial), bankers’
acceptances, bank guaranties, surety bonds and similar instruments, (d) without
        duplication, all Guarantees with respect to outstanding Indebtedness of the
        types specified in clauses (a) through (d) above of Persons other than the
        Borrowers or any Subsidiary; and (e) all Indebtedness of the types referred
        to
        in clauses (a) through (d) above of any partnership or joint venture (other
        than
        a joint venture that is itself a corporation or limited liability company)
        in
        which any Borrower or a Subsidiary is a general partner or joint venturer,
        unless such Indebtedness is expressly made non-recourse to such Borrower
        or such
        Subsidiary.

       

      Consolidated
        Net Income (or Deficit). Means the consolidated net income (or deficit) of
        the Borrowers, after deduction of all expenses, taxes, and other proper charges,
        determined in accordance with GAAP.

       

      Consolidated
        Total Interest Expense.  Means, for any period, the aggregate
        amount of cash interest required to be paid by the Borrowers on a consolidated
        basis during such period on all

       

      
        
          
          

        

        
          -7-

          
            

          

        

        
          
          

        

      

      Indebtedness
        of the Borrowers determined on a consolidated basis outstanding during all
        or
        any part of such period.

       

      Contractual
        Obligation.  Means, as to any Person, any provision of any
        security issued by such Person or of any agreement, instrument or other
        undertaking to which such Person is a party or by which it or any of its
        property is bound.

       

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

       

      Controlled
        Group.  Has the meaning set forth in §7.16 hereof.

       

      Country
        Risk Event.  Means (a) any law, action or failure to act by any
        Governmental Authority in any Borrower’s or Letter of Credit beneficiary’s
        country which has the effect of: (i) changing the obligations under the relevant
        Letter of Credit, the Credit Agreement or any of the other Loan Documents
        as
        originally agreed or otherwise creating any additional liability, cost or
        expense to the Issuing Bank, the Lenders or the Administrative Agent, (ii)
        changing the ownership or control by such Borrower or Letter of Credit
        beneficiary of its business, or (iii) preventing or restricting the conversion
        into or transfer of the applicable Alternative Currency; (b) force majeure;
        or
        (c) any similar event which, in relation to (a), (b) and (c), directly or
        indirectly, prevents or restricts the payment or transfer of any amounts
        owing
        under the relevant Letter of Credit in the applicable Alternative Currency
        into
        an account designated by the Administrative Agent or the Issuing Bank and
        freely
        available to the Administrative Agent or the Issuing Bank.

       

      Credit
        Agreement.  Means this Credit Agreement, including the Schedules
        and Exhibits hereto, as the same may be amended, restated or otherwise modified
        from time to time.

       

      Credit
        Extension.  Means, as the context requires, (a) a borrowing of a
        Loan or the continuation of or conversion into a Eurodollar Rate Loan or
        CDOR
        Rate Loan or an L/C Credit Extension, or (b) a Borrowing (including the
        continuation, renewal or conversion thereof) under the Canadian Credit Facility
        provided that any reference herein to the amount of principal thereof, in
        the
        case of a Borrowing by way of BA shall refer to the face amount of such BA
        and
        in the case of a Borrowing by way of LC or LG the outstanding face amount
        thereof plus the amount unreimbursed in connection therewith.

       

      Default.  Any
        Event of Default or event or condition that with the giving of notice or
        lapse
        of time or both would become an Event of Default.

       

      Defaulting
        Lender.  Means any Lender that (a) has failed to fund any portion
        of the Loans or participations in L/C Obligations required to be funded by
        it
        hereunder within one Business Day of the date required to be funded by it
        hereunder, (b) has otherwise failed to pay over to the Administrative Agent
        or
        any other Lender any other amount required to be paid by it hereunder within
        one
        Business Day of the date when due, unless the subject of a good faith dispute,
        or (c) has been deemed insolvent or become the subject of a bankruptcy or
        insolvency proceeding.

       

      Default
        Rate.  Has the meaning set forth in §5.7.

       

      Dollar
        Equivalent. Means, at any time, (a) with respect to any amount denominated
        in Dollars, such amount, (b) with respect to any amount denominated in Canadian
        Dollars, the equivalent amount thereof in Dollars as determined by the
        Administrative Agent, through its principal foreign exchange trading office
        as
        of the date as of which the foreign exchange computation is made and (c)
        with
        respect to

       

      
        
          
          

        

        
          -8-

          
            

          

        

        
          
          

        

      

      any
        Alternative Currency, the equivalent amount thereof in Dollars as determined
        by
        the Administrative Agent, through its principal foreign exchange trading
        office
        as of the date as of which the foreign exchange computation is
        made.

       

      Dollars
        or U.S. $.  Means dollars in lawful currency of the United States
        of America.

       

      Drawdown
        Date.  Means the date on which any Revolving Credit Loan, Canadian
        Revolving Credit Loan  or the Term Loan, as applicable, is made or is
        to be made, and the first day of any Interest Period.

       

      Drawing
        Amount.  Means the maximum aggregate amount that the beneficiaries
        may at any time draw under outstanding Letters of Credit, as such aggregate
        amount may be reduced from time to time pursuant to the terms of the Letters
        of
        Credit.

       

      Effective
        Date.  Means the date on which the initial Loans are made
        hereunder.

       

      Eligible
        Assignee.  Means (a) a Lender; (b) an Affiliate of the Lender; (c)
        an Approved Fund; and (d) any other Person (other than a natural person)
        approved by (i) the Administrative Agent and the Issuing Bank; and (ii) the
        Borrowers (such approval not to be unreasonably withheld or delayed); provided
        that the Borrowers approval shall not be required if an Event of Default
        has
        occurred and is continuing.  “Eligible Assignee” shall not include any
        of the Borrowers or any of the Borrowers’ Affiliates or
        Subsidiaries.

       

      Eligible
        Foreign Subsidiary.  Means any Foreign Subsidiary that is approved
        from time to time by the Lenders.

       

      EMU
        Legislation.  Means the legislative measures of the European
        Council for the introduction of, changeover to or operation of a single or
        unified European currency.

       

      Environmental
        Laws.  Means, with respect to any applicable jurisdictions, the
        federal, state, provincial, municipal, local and foreign laws, principles
        of
        common law or civil law, regulations, by-laws, guidelines and codes, as such
        laws, principles, regulations, by-laws and guidelines and codes may be amended
        from time to time, as well as orders, decrees, judgments, seizures or
        injunctions issued, promulgated, approved or entered thereunder relating
        to
        pollution, protection of the environment, or protection of the public from
        pollution or employee health and safety, including, but not limited to the
        Release or threatened Release of Hazardous Substances into the environment
        or
        otherwise relating to the presence, manufacture, processing, distribution,
        use,
        treatment, storage, disposal, transport or handling of Hazardous
        Substances.

       

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

       

      Euro
        or EUR.  Means the lawful currency of the Participating Member
        States introduced in accordance with the EMU Legislation.

       

      Eurodollar
        Breakage Fee.  Has the meaning set forth in
§ 5.9(a).

       

      Eurodollar
        Business Day.  Means any Business Day on which commercial banks
        are open for international business (including dealings in Dollar deposits)
        in
        London, England or such other Eurodollar interbank market as may be selected
        by
        the Lender in its sole discretion acting in good faith.

       

      
        
          
          

        

        
          -9-

          
            

          

        

        
          
          

        

      

      Eurodollar
        Rate Loans.  Means Revolving Credit Loans bearing interest
        calculated by reference to the Eurodollar Rate.

       

      Eurodollar
        Rate.  Means, relative to any Interest Period, (a) for Eurodollar
        Rate Loans denominated in Dollars, the offered rate for deposits of U.S.
        Dollars
        in an amount approximately equal to the amount of the requested Eurodollar
        Rate
        Loan for a term coextensive with the designated Interest Period which the
        British Bankers’ Association fixes as its LIBOR rate, and (b) for Eurodollar
        Rate Loans denominated in any Alternative Currency, the offered rate for
        deposits of such Alternative Currency in an amount approximately equal to
        the
        amount of the requested Eurodollar Rate Loan for a term coextensive with
        the
        designated Interest Period shown in the appropriate page of Reuters Monitor
        Money Rates Service (or any successor thereto providing rate quotations
        comparable to those currently provided by such service, as determined by
        the
        Administrative Agent in its commercially reasonable discretion) which the
        British Bankers’ Association fixes as its LIBOR rate for such Alternative
        Currency, in each case, as of 11:00 a.m. London time on the day which is
        two
        London Banking Days prior to the beginning of such Interest
        Period.  If such day is not a London Banking Day, the Eurodollar Rate
        shall be determined on the next preceding day which is a London Banking
        Day.  If for any reason the Administrative Agent cannot determine such
        offered rate by the British Bankers’ Association, the Administrative Agent may,
        in its discretion, select a replacement index based on the arithmetic mean
        of
        the quotations, if any, of the interbank offered rate by first class banks
        in
        London or New York for deposits in comparable amounts, currencies and
        maturities.

       

      Eurodollar
        Reserve Percentage.  Means, with respect to any currency, a
        fraction (expressed as a decimal), the numerator of which is the number one
        and
        the denominator of which is the number one minus the aggregate of the maximum
        reserve, liquid asset, fees or similar requirements (including any marginal,
        special, emergency or supplemental reserves or other requirements) established
        by any central bank, monetary authority, the FRB, the Financial Services
        Authority of England, the European Central Bank or other Governmental Authority
        for any category of deposits or liabilities customarily used to fund loans
        in
        such currency, expressed in the case of each such requirement as a
        decimal.  Such reserve percentages shall, in the case of Dollar
        denominated Loans, include those imposed pursuant to Regulation D of the
        FRB.  Eurodollar Loans shall be deemed to be subject to such reserve,
        liquid asset or similar requirements without benefit of or credit for proration,
        exemptions or offsets that may be available from time to time to any Lender
        under any applicable law, rule or regulation, including
        Regulation D.  The Eurodollar Reserve Percentage shall be
        adjusted automatically on and as of the effective date of any change in any
        reserve, liquid asset or similar requirement.

       

      Event
        of Default.  Has the meaning set forth §12.1.

       

      Excise
        Tax Act (Canada).  Means R.S. 1985, c. E-15.

       

      Excluded
        Taxes.  Means, with respect to the Administrative Agent, any
        Lender, the Issuing Bank or any other recipient of any payment to be made
        by or
        on account of any obligation of any Borrower hereunder, (a) taxes imposed
        on or measured by its overall net income (however denominated), and franchise
        taxes imposed on it (in lieu of net income taxes), by the jurisdiction (or
        any
        political subdivision thereof) under the laws of which such recipient is
        organized or in which its principal office is located or, in the case of
        any
        Lender, in which its applicable lending office is located, (b) any branch
        profits taxes imposed by the United States of America or any similar tax
        imposed
        by any other jurisdiction in which such Borrower is located and (c) in the
        case of a Foreign Lender (other than an assignee pursuant to a request by
        any
        Borrower under § 5.14), any withholding tax that is imposed on amounts
        payable to such Foreign Lender at the time such Foreign Lender becomes a
        party
        hereto (or designates a new lending office) or is attributable to such Foreign
        Lender’s failure or inability (other than as a result of a Change in Law) to
        comply with § 5.14, except to the extent that such Foreign Lender (or its
        assignor, if any) was

       

      
        
          
          

        

        
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      entitled,
        at the time of designation of a new lending office (or assignment), to receive
        additional amounts from such Borrower with respect to such withholding tax
        pursuant to § 5.14.

       

      Existing
        Credit Facilities.  Means the credit facilities in place as of the
        date of this Agreement among LoJack, the Loan Parties party thereto, the
        Bank of
        Montreal and Harris Trust and Savings Bank.

       

      Federal
        Funds Rate.  Means, for any day, the rate per annum 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 that (a) 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 (b) 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 (rounded
        upward, if necessary, to a whole multiple of 1/100 of 1%) charged to the
        Administrative Agent on such day on such transactions as determined by the
        Administrative Agent.

       

      Fixed
        Charge Coverage Ratio.  Has the meaning set forth in
§10.1.

       

      FRB.  Means
        the Board of Governors of the Federal Reserve Systems of the United
        States.

       

      Foreign
        Borrowers. Means any Borrower (other than the Canadian Borrowers) which is
        not organized under the laws of the United States, any state or commonwealth
        thereof, or the District of Columbia and is listed on Schedule 1 hereto
        as of the date hereof or is designated as a Foreign Borrower pursuant to
        §2.1.9.

       

      Foreign
        Lender.  Means, with respect to any Borrower, any Lender that is
        organized under the laws of a jurisdiction other than that in which such
        Borrower is resident for tax purposes.  For purposes of this
        definition, the United States of America, each State thereof and the District
        of
        Columbia shall be deemed to constitute a single jurisdiction.

       

      Foreign
        Obligations. Means such portion of the Obligations of the Foreign Borrowers
        to the Administrative Agent and the Lenders existing on the date of this
        Agreement or arising thereafter, direct or indirect, joint or several, absolute
        or contingent, matured or unmatured, liquidated or unliquidated, secured
        or
        unsecured, arising by contract, operation of law or otherwise, arising or
        incurred under this  Agreement or any of the other Loan Documents or
        in respect of the Loans, the Notes, any Swap Contract with any Lenders or
        any
        Affiliate thereof, Letter of Credit Applications, Letters of Credit, and
        Bank
        Product Obligations (in either case entered into by a Foreign Borrower) or
        any
        other instrument at any time evidencing any thereof.

       

      Foreign
        Sublimit.  As of the Closing Date, means Fifty Million Dollars ($
        50,000,000), as such amount may be reallocated by agreement of the
        Administrative Agent and LoJack.

       

      Foreign
        Subsidiary/Foreign Subsidiaries.  Means, any Subsidiary of any of
        the Borrowers not organized under the laws of the United States or Canada
        or any
        state or province thereof existing as of the date hereof or which is acquired
        or
        created after the date hereof.

       

      Fund.  Means
        any Person (other than a natural person) that is (or will be) engaged in
        making,
        purchasing, holding or otherwise investing in commercial loans and similar
        extensions of credit in the ordinary course of its business.

       

      
        
          
          

        

        
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      Generally
        accepted accounting principles or GAAP.  Means the generally
        accepted accounting principles in the United States set forth in the opinions
        and pronouncements of the Accounting Principles Board and the American Institute
        of Certified Public Accountants and statements and pronouncements of the
        Financial Accounting Standards Board or such other principles as may be approved
        by a significant segment of the accounting profession in the United States
        that
        are applicable to the circumstances as of the date of determination,
        consistently applied.

       

      Governmental
        Authority means any nation or government, any state or other political
        subdivision thereof, any agency, authority, instrumentality, regulatory body,
        court, administrative tribunal, central bank or other entity exercising
        executive, legislative, judicial, taxing, regulatory or administrative powers
        or
        functions of or pertaining to government.

       

      Guarantee.  Means
        as to any Person, any (a) any obligation, contingent or otherwise, of such
        Person guaranteeing or having the economic effect of guaranteeing any
        Indebtedness or other obligation payable or performable by another Person
        (the
“primary obligor”) in any manner, whether directly or indirectly, and including
        any obligation of such Person, direct or indirect, (i) to purchase or pay
        (or
        advance or supply funds for the purchase or payment of) such Indebtedness
        or
        other obligation, (ii) to purchase or lease property, securities or services
        for
        the purpose of assuring the obligee in respect of such Indebtedness or other
        obligation of the payment or performance of such Indebtedness or other
        obligation, (iii) to maintain working capital, equity capital or any other
        financial statement condition or liquidity or level of income or cash flow
        of
        the primary obligor so as to enable the primary obligor to pay such Indebtedness
        or other obligation, or (iv) entered into for the purpose of assuring in
        any
        other manner the obligee in respect of such Indebtedness or other obligation
        of
        the payment or performance thereof or to protect such obligee against loss
        in
        respect thereof (in whole or in part), or (b) any Lien on any assets of such
        Person securing any Indebtedness or other obligation of any other Person,
        whether or not such Indebtedness or other obligation is assumed by such
        Person.  For purposes of calculating Indebtedness, the amount of any
        Guarantee shall be deemed to be an amount equal to the stated or determinable
        amount of the related primary obligation, or portion thereof, in respect
        of
        which such Guarantee is made or, if not stated or determinable, the maximum
        reasonably anticipated liability in respect thereof as determined by the
        guaranteeing Person in good faith.  The term “Guarantee” as a verb has
        a corresponding meaning.

       

      Guarantor;
        Guaranty.  Has the meaning set forth in the Preamble.

       

      Hazardous
        Substances.  Means any waste, contaminant, pollutant, hazardous
        substance, toxic substance, hazardous waste, special waste, industrial substance
        or waste, radio-active materials, petroleum or petroleum-derived substance
        or
        waste, or any constituent or combination of any such substance or waste,
        which
        substance, contaminant, pollutant or material or waste is or shall hereafter
        become regulated under, governed by, or defined by any Environmental
        Law.

       

      Honor
        Date.  Means the date of any payment by the Issuing Bank under a
        Letter of Credit.

       

      Immaterial
        Foreign Subsidiary.  Means a Foreign Subsidiary designated as such
        by LoJack , provided, that (a) none of the obligations or Indebtedness of
        such Foreign Subsidiary are Guaranteed by LoJack, any of the Borrowers and/or
        any Guarantor, and (b) after giving effect to such designation, the aggregate
        net tangible assets (excluding therefrom any shares or all of equity interests
        held by any designated Foreign Subsidiary in another Foreign Subsidiary)
        of all
        Foreign Subsidiaries so designated does not exceed the Dollar Equivalent
        of
        $3,000,000.

       

      Increase
        Closing Date.  Has the meaning set forth in
§ 2.1.8(d).

       

      
        
          
          

        

        
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      Indebtedness.  Means
        as to any Person at a particular time, without duplication, all of the
        following, whether or not included as indebtedness or liabilities in accordance
        with GAAP:

       

      (a)           all
        obligations of such Person for borrowed money and all obligations of such
        Person
        evidenced by bonds, debentures, notes, loan agreements or other similar
        instruments;

       

      (b)           all
        direct or contingent obligations of such Person arising under letters of
        credit
        (including standby and commercial), bankers’ acceptances, bank guaranties,
        surety bonds and similar instruments;

       

      (c)           for
        the purposes of §§ 12.1(f) and 9.1 only, net obligations of such Person under
        any Swap Contract or similar type of agreement;

       

      (d)           all
        obligations of such Person to pay the deferred purchase price of property
        or
        services (other than trade accounts payable in the ordinary course of
        business);

       

      (e)           indebtedness
        (excluding prepaid interest thereon) secured by a Lien on property owned
        or
        being purchased by such Person (including indebtedness arising under conditional
        sales or other title retention agreements), whether or not such indebtedness
        shall have been assumed by such Person or is limited in recourse;
        and

       

      (f)           all
        Guarantees of such Person in respect of any of the foregoing.

       

      For
        all
        purposes hereof, the Indebtedness of any Person shall include the Indebtedness
        of any partnership or joint venture (other than a joint venture that is itself
        a
        corporation or limited liability company) in which such Person is a general
        partner or a joint venturer, unless such Indebtedness is expressly made
        non-recourse to such Person.  The amount of any net obligation under
        any Swap Contract on any date shall be deemed to be the Swap Termination
        Value
        thereof as of such date.

       

      Indemnified
        Taxes.  Means Taxes other than Excluded Taxes.

       

      Indemnitees.  Has
        the meaning set forth §14.3.

       

      Instrument
        of Accession.  Has the meaning set forth in
§ 2.1.8(c).

       

      Interest
        Act (Canada).  Means 1985 R.S., c. L-18.

       

      Interest
        Payment Date.  Means (a) as to any Eurodollar Rate Loan or CDOR
        Rate Loan having an Interest Period of three months or less, the last Business
        Day of such Interest Period, as (b) to any LIBOR Rate Loan having an Interest
        Period longer than three months, each Business Day which is three months
        after
        the first day of such Interest Period and the last day of such Interest Period,
        and (c) as to any Base Rate Loan, the last day of the calendar month with
        respect to interest accrued during such calendar month, including, without
        limitation, the calendar month which includes the Drawdown Date of such Base
        Rate Loan.

       

      Interest
        Period.  Means, with respect to each Eurodollar Rate Loan or CDOR
        Rate Loan, (i) initially, the period commencing on the Closing Date and ending
        one (1), two (2), or three (3) months thereafter, as the case may be, or,
        subject to currency requirements to the extent that the Loan is made in an
        Alternative Currency, six (6) months, as the applicable Borrower may select;
        and
        (ii) thereafter, the period commencing on the last day of the preceding Interest
        Period, and ending one (1), two (2), or three (3) months thereafter, as the
        case
        may be, or, subject to currency requirements to the extent that the
        Loan

       

      
        
          
          

        

        
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      is
        made
        in an Alternative Currency, six (6) months, as the applicable Borrower may
        select; provided that all of the foregoing provisions relating to Interest
        Periods are subject to the following:

       

      (a)           Interest
        Periods for Eurodollar Rate Loans or CDOR Rate Loans in connection with which
        any Borrower has or may incur hedging obligations with any of the Lenders
        shall
        be of the same duration as the relevant periods set forth under the applicable
        hedge contract.

       

      (b)           if
        any Interest Period with respect to a Eurodollar Rate Loan or CDOR Rate Loan
        would otherwise end on a day that is not a Eurodollar Business Day, that
        Interest Period shall be extended to the next succeeding Eurodollar Business
        Day
        unless the result of such extension would be to carry such Interest Period
        into
        another calendar month, in which event such Interest Period shall end on
        the
        immediately preceding Eurodollar Business Day;

       

      (c)           any
        Interest Period relating to any Eurodollar Rate Loan that begins on the last
        Eurodollar 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 Eurodollar Business Day of a calendar month;
        and

       

      (d)           any
        Interest Period relating to any Loan that would otherwise extend beyond the
        Maturity Date shall end on the Maturity Date.

       

      Notwithstanding
        the foregoing, if an Event of Default has occurred and is continuing, the
        Interest Period shall be one (1) month or such other period as approved by
        the
        Administrative Agent.

       

      Investment.  Means,
        as to any Person, any direct or indirect acquisition or investment by such
        Person, whether by means of (a) the purchase or other acquisition of capital
        stock or other securities of another Person, (b) a loan, advance or capital
        contribution to, Guarantee or assumption of debt of, or purchase or other
        acquisition of any other debt or equity participation or interest in, another
        Person, including any partnership or joint venture interest in such other
        Person, or (c) the purchase or other acquisition (in one transaction or a
        series
        of transactions) of assets of another Person that constitute a business
        unit.  For purposes of covenant compliance, the amount of any
        Investment shall be the amount actually invested, without adjustment for
        subsequent increases or decreases in the value of such Investment.

       

      Issuing
        Bank.  Means Citizens Bank of Massachusetts, in its capacity as
        issuer of letters of credit, or any successor issuer of letters of credit
        hereunder.

       

      Judgment
        Currency.  Has the meaning set forth in §12.3.

       

      L/C
        Advance.  Means, with respect to any Revolving Credit Lender, such
        Revolving Credit Lender’s funding of its participation in any L/C Borrowing in
        accordance with its Applicable Percentage of the Revolving Credit
        Commitments.

       

      L/C
        Borrowing.  Means an extension of credit resulting from a drawing
        under any Letter of Credit which has not been reimbursed on the date when
        made
        or refinanced pursuant to a Revolving Credit Loan.

       

      L/C
        Credit Extension.  Means, with respect to any Letter of Credit,
        the issuance thereof or extension of the expiry date thereof, or the renewal
        or
        increase of the amount thereof.

       

      
        
          
          

        

        
          -14-

          
            

          

        

        
          
          

        

      

      L/C
        Obligations.  Means, as of any date of determination, with respect
        to the Revolving Credit Loans, and where the context requires, the Canadian
        Revolving Credit Loans, the Drawing Amount of all outstanding Letters of
        Credit
        plus the aggregate of all unreimbursed amounts in connection therewith,
        including the Unreimbursed Amounts.

       

      Lead
        Arranger.  Citizens Bank of Massachusetts.

       

      Lenders.  Means
        the Revolving Credit Lenders, the Term Loan Lenders and the Canadian Lender
        listed on Schedule 2 hereto and any financial institutions which become a
        party hereto pursuant to the terms of §§ 2.1.8 or 14.6 in their individual
        capacity, and “Lenders” means all of such financial institutions.

       

      Lending
        Office.  Means, as to any Lender, the  offices and
        branches of such Lender and it Affiliates listed on Schedule 3 hereto (as
        may be amended from time to time), or such other office or branch as a Lender
        may from time to time notify the Borrowers and the Administrative
        Agent.

       

      Letter(s)
        of Credit.  Has the meaning, as the context requires, set forth in
§ 2.2.1 or Schedule 3.1-A.

       

      Letter
        of Credit Application.  Means an application and agreement for the
        issuance or amendment of a Letter of Credit in the form from time to time
        in use
        by the Issuing Bank.

       

      Letter
        of Credit Expiration Date.  Means, with respect to each Letter of
        Credit, the day that is five (5) days prior to the Maturity Date with respect
        to
        Revolving Credit Loans (or, if such day is not a Business Day, the next
        preceding Business Day).

       

      Letter
        of Credit Sub-limit.  Means, with respect to the Revolving Loan,
        an amount not to exceed $5,000,000.  The Letter of Credit Sub-limit is
        part of, and not in addition to, the Commitment.

       

      Lien  means
        any mortgage, pledge, hypothecation, assignment, deposit arrangement,
        encumbrance, lien (statutory or other), charge, or preference, priority or
        other
        security interest or preferential arrangement of any kind or nature whatsoever
        (including any conditional sale or other title retention agreement, and any
        capitalized lease obligation having substantially the same economic effect
        as
        any of the foregoing).

       

      Loan
        Party/Loan Parties.  Means, collectively, the Borrowers and the
        Guarantors.

       

      Loans.  Means
        (i) the Revolving Credit Loans made or to be made by the Revolving Credit
        Lenders to the U.S. Borrowers and the Foreign Borrowers pursuant to §2.1; (ii)
        the Term Loan made by the Term Loan Lenders to the Term Loan Borrower pursuant
        to §4.1; and (iii) unless the context requires otherwise, the Canadian Revolving
        Credit Loans to be made by the Canadian Lender to the Canadian Revolving
        Borrowers.

       

      Loan
        Documents.  Means this Credit Agreement, the Notes, the Letter of
        Credit Applications, the Letters of Credit, the Pledge Agreement, any Additional
        Pledge Agreement and any other document and instrument entered into by the
        Issuing Bank and any of the Loan Parties or any of their Subsidiaries or
        in
        favor of the Issuing Bank and relating to such Letters of Credit, all BAs,
        LCs,
        LGs and all documents and instruments executed by any of the Canadian Revolving
        Borrowers and/or in favor of the Canadian Lender in connection with BAs,
        LCs and
        LGs issued or to be issued pursuant to the Canadian Credit
        Facility.

       

      
        
          
          

        

        
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      Loan
        Request.  Has the meaning set forth in § 2.1.4.

       

      LoJack
        Ireland.  Has the meaning set forth in
§ 11.2(a).

       

      London
        Banking Day.  Means a day on which dealings in Dollar deposits are
        transacted in the London interbank market.

       

      Material
        Adverse Effect.  Means (a) a material adverse change in, or a
        material adverse effect upon, the operations, business, properties, liabilities
        (actual or contingent), condition (financial or otherwise) or prospects of
        the
        Borrowers and their Subsidiaries taken as a whole; (b) a material impairment
        of
        the ability of any Loan Party to perform its obligations under any Loan Document
        to which it is a party, or (c) a material adverse effect upon the legality,
        validity, binding effect or enforceability against any Loan Party of any
        Loan
        Document to which it is a party.

       

      Material
        Acquisition.  Means any acquisition of any Acquired Entity or
        Business by any Borrower or Subsidiary thereof with respect to which the
        aggregate consideration payable by the Borrowers and their Subsidiaries exceeds
        $5,000,000.

       

      Material
        Divestiture.  Means any sale or dissolution of a business or
        revenue earning asset with attributable contribution to Consolidated EBITDA
        for
        LoJack’s prior fiscal year in an amount equal to or exceeding
        $3,000,000.

       

      Maturity
        Date.  Means, (a) with respect to the Revolving Credit Loans and
        the Canadian Revolving Credit Loans, the fifth (5th) anniversary of the Closing
        Date, and (b) with respect to the Term Loan, the date that is one day after
        the
        fifth (5th) anniversary of the Closing Date.

       

      Multiemployer
        Plan.  Means any multiemployer plan within the meaning of (i)
        Section 4001(a)(3) of ERISA or (ii) Subsection 147.1(1) of the United States
        Internal Revenue Code, to which any Borrower or any related Person makes
        or is
        obligated to make contributions, or during the preceding five (5) plan years,
        has made or been obligated to make contributions.

       

      New
        Money Credit Event.  Means with respect to the Issuing Bank, any
        increase (directly or indirectly) in the Issuing Bank’s exposure (whether by way
        of additional credit or banking facilities or otherwise, including as part
        of a
        restructuring) to any Borrower or any Governmental Authority in any Borrower’s
        or any applicable Letter of Credit beneficiary’s country occurring by reason of
        (i) any law, action or requirement of any Governmental Authority in such
        Borrower’s or such Letter of Credit beneficiary’s country, or (ii) any request
        in respect of external indebtedness of borrowers in such Borrower’s or such
        Letter of Credit beneficiary’s country applicable to banks generally which
        conduct business with such borrowers, or (iii) any agreement in relation
        to
        clause (i) or (ii), in each case to the extent calculated by reference to
        the
        aggregate Revolving Credit Exposure outstanding prior to such
        increase.

       

      Notes.  Means,
        collectively, the Revolving Credit Notes, the Canadian Revolving Credit Notes
        and the Term Notes.

       

      Notice
        of Purchase.  Has the meaning set forth in §2.3(c).

       

      Obligations.  Means
        any and all indebtedness, obligations and liabilities of the Borrowers to
        the
        Administrative Agent and the Lenders existing on the date of this Agreement
        or
        arising thereafter, direct or indirect, joint or several, absolute or
        contingent, matured or unmatured, liquidated or unliquidated, secured or
        unsecured, arising by contract, operation of law or otherwise, arising or
        incurred under this

       

      
        
          
          

        

        
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      Agreement
        or any of the other Loan Documents or in respect of the Loans, the Notes,
        any
        Swap Contract with any Lenders or any Affiliate thereof, Letter of Credit
        Applications, Letters of Credit, and Bank Product Obligations or any other
        instrument at any time evidencing any thereof, including, without limitation,
        the U.S. Obligations, the Canadian Obligations, the Foreign Obligations,
        and the
        Canadian Revolving Obligations.

       

      Organization
        Documents.  Means (a) with respect to any corporation, the
        certificate of articles of incorporation and the by-laws (or equivalent or
        comparable constitutive documents with respect to any Canadian or other non-U.S.
        jurisdiction); (b) with respect to any limited liability company, the
        certificate or articles of formation or organization and operating agreement;
        and (c) with respect to any partnership, joint venture, trust or other form
        of
        business entity, the partnership, joint venture or other applicable agreement
        of
        formation or organization and any agreement, instrument, filing or notice
        with
        respect thereto filed in connection with its formation or organization with
        the
        applicable Governmental Authority in the jurisdiction of its formation or
        organization and, if applicable, any certificate or articles of formation
        or
        organization of such entity.

       

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

       

      Outstanding
        Amount.  Means (i) with respect to Loans (including for greater
        certainty Canadian Revolving Credit Loans by way of Libor Loans, RBP Loans
        and
        RBUSBR Loans) on any date, the aggregate outstanding principal amount thereof
        after giving effect to any borrowings and prepayments or repayments of Loans
        occurring on such date; (ii) with respect to any L/C Obligations on any date,
        the amount of such L/C Obligations on such date after giving effect to any
        L/C
        Credit Extension occurring on such date and any other changes in the aggregate
        amount of the L/C Obligations as of such date, including as a result of any
        reimbursements of outstanding unpaid drawings under any Letters of Credit
        or any
        reductions in the maximum amount available for drawing under Letters of Credit
        taking effect on such date and (iii) the aggregate of all face amounts of
        all Bankers’ Acceptances outstanding under the Canadian Credit Facility and the
        aggregate of all full outstanding amounts of all LCs and LGs issued under
        the
        Canadian Credit Facility plus the aggregate amount of all unreimbursed amounts
        in connection therewith.

       

      Overadvance.  Means,
        with respect to the Revolving Credit Facility, the amount by which the
        Outstanding Amount of the Revolving Credit Loans exceeds the Revolving Credit
        Commitment.

       

      Participant.  Has
        the meaning specified in §14.6(d).

       

      Participating
        Member State.  Means each state so described in any EMU
        Legislation.

       

      Permit.  Means
        any approval, consent, waiver, exemption, variance, franchise, order, permit,
        certificate, authorization, certificate of authorization, right or license
        or
        other approval of or from any Person or Governmental Authority necessary
        or
        required by any laws, regulations, by-laws and orders, including Environmental
        Laws, to properly conduct the business of the Borrower or to make substantial
        use of the real and immovable property, assets, equipment and facilities
        owned
        or leased by the Borrower.

       

      Permitted
        Acquisitions.  Means any acquisition of any Acquired Entity or
        Business by any Borrower or Subsidiary thereof which meets all of the following
        criteria: (i) no Default or Event of Default has occurred and is continuing
        or
        would result therefrom; (ii) all transactions related thereto are consummated
        in
        accordance with applicable laws; (iii) prior to such acquisition (if a
        Material

       

      
        
          
          

        

        
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      Acquisition),
        the Administrative Agent shall have received (A) computations from the Borrowers
        (based on a Compliance Certificate) showing pro forma compliance as of the
        date
        of, and after giving effect to, such acquisition with the financial covenants
        set forth in §10 of this Agreement; and (B) all due diligence information in the
        form of financial statements of the acquired entity and all materials provided
        to the board of directors of LoJack; and (iv) if in the Lenders’ discretion the
        Acquired Entity is material and is not a Foreign Subsidiary, concurrently
        with
        the consummation of such acquisition, the acquired entity becomes a Guarantor
        hereunder or, at the request of LoJack, a Borrower (subject in the case of
        Foreign Subsidiaries to the definition of Eligible Foreign Subsidiary) and
        executes any and all documents and instruments reasonably required by the
        Administrative Agent to that effect.

       

      Permitted
        Investments.  Means any investments permitted under Section
        9.3.

       

      Person.
        Means any individual, corporation, partnership, trust, unincorporated
        association, business, joint venture, or other legal entity, and any government
        or any governmental agency or political subdivision thereof.

       

      Pledge
        Agreement.  Has the meaning set forth in § 11.2.

       

      Pledged
        Equity.  Has the meaning set forth in § 11.2.

       

      Post-Acquisition
        Period. means, with respect to any Permitted Acquisition,
        the period beginning on the date such Permitted Acquisition is consummated
        and
        ending on the last day of the sixth full consecutive fiscal quarter immediately
        following the date on which such Permitted Acquisition is
        consummated.

       

      Post-Closing Increase.  Has
        the meaning set forth in § 2.1.8(c).

       

      Pro
        Forma Adjustment.  means, for any Reference Period
        that includes all or any part of a fiscal quarter included in any
        Post-Acquisition Period, with respect to the Acquired EBITDA of the applicable
        Acquired Entity or Business, the pro forma increase or decrease in such Acquired
        EBITDA projected by the Borrowers in good faith as a result of (a) actions
        taken
        during such Post-Acquisition Period for the purposes of realizing reasonably
        identifiable and factually supportable cost savings or (b) any additional
        costs
        incurred during such Post-Acquisition Period, in each case in connection
        with
        the combination of the operations of such Acquired Entity or Business with
        the
        operations of the Borrowers and their Subsidiaries; provided that, so
        long as such actions are taken during such Post-Acquisition Period or such
        costs
        are incurred during such Post-Acquisition Period, as applicable, the cost
        savings related to such actions or such additional costs, as applicable,
        it may
        be assumed, for purposes of projecting such pro forma increase or decrease
        to
        such Acquired EBITDA that such cost savings will be realizable during the
        entirety of such Reference Period, or such additional costs, as applicable,
        will
        be incurred during the entirety of such Reference Period; provided
        further that any such pro forma increase or decrease to such Acquired
        EBITDA shall be without duplication for cost savings or additional costs
        already
        included in such Acquired EBITDA for such Reference Period.

       

      Property.  Means
        , as to any Person, all types of real, personal, tangible, intangible or
        mixed
        property owned by such Person or in which such Person has the right, title
        or
        interest, whether or not such property is included in the balance sheet of
        such
        Person and its subsidiaries under GAAP.

       

      Qualified
        Canadian Lender.  Means a Lender who (i) is not a “non-resident”
within the meaning of the Income Tax Act (Canada), or (ii) is an “authorized
        foreign bank” within the meaning of the Bank Act (Canada) but only in respect of
        amounts paid or credited hereunder in respect of its “Canadian banking Business”
within the meaning of the Income Tax Act (Canada).

       

      
        
          
          

        

        
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      Reference
        Period.  As of any date of determination, the period of four (4)
        consecutive fiscal quarters of the Borrowers and their Subsidiaries ending
        on
        such date, or if such date is not a fiscal quarter end date, the period of
        four
        (4) consecutive fiscal quarters most recently ended (in each case treated
        as a
        single accounting period).

       

      Register.  Has
        the meaning set forth in §14.6(c).

       

      Related
        Parties.  Means, with respect to any Person, such Person’s
        Affiliates and the partners, directors, officers, employees, agents and advisors
        of such Person and of such Person’s Affiliates.

       

      Release.  Means
        any release, issuance, spill, emission, leaking, pumping, injection, deposit,
        disposal, discharge, dispersal, leaching or migration into the indoor or
        outdoor
        environment or into or out of any property, including the movement of Hazardous
        Substances through or in the air, soil, surface water, ground water, or property
        other than in compliance with all Environmental Laws, Permits, and
        Leases.

       

      Required
        Lenders.  Means, as of any date of determination, Lenders having
        more than sixty six and two thirds percent (66 2/3%) of the sum of (a) the
        Aggregate Commitments (including for greater certainty the Canadian Revolving
        Credit Commitment) plus (b) the Outstanding Amount of the Term Loan; or,
        if the commitment of each Lender to make Loans and the obligation of the
        Issuing
        Bank to make L/C Credit Extensions have been terminated pursuant to §12.2,
        Lenders holding in the aggregate more than sixty six and two thirds percent
        (66
        2/3%) of the Total Outstandings (with the aggregate amount of each Lender’s risk
        participation and funded participation in L/C Obligations being deemed “held” by
        such Lender for purposes of this definition); provided that the
        Commitment of, and the portion of the Total Outstandings held or deemed held
        by
        any Defaulting Lender shall be excluded for purposes of making a determination
        of Required Lenders; and provided, further, that in the event that
        the are only two Lenders, “Required Lenders” shall be both such
        Lenders.

       

      Responsible
        Officer.  Means the Chief Executive Officer, president,
        vice-president, Chief Financial Officer, treasurer or assistant treasurer
        of
        each Borrower.  Any document delivered hereunder that is signed by a
        Responsible Officer shall be conclusively presumed to have been authorized
        by
        all necessary corporate, partnership and/or other action and such Responsible
        Officer shall be conclusively presumed to have acted on behalf of the applicable
        Borrower.

       

      Revaluation
        Date.   Means (a) with respect to any Loan, each of the
        following: (i) each date of a borrowing of a Eurodollar Rate Loan or CDOR
        Rate
        Loan denominated in an Alternative Currency, (ii) each date of a continuation
        of
        a Eurodollar Rate Loan or CDOR Rate Loan denominated in an Alternative Currency,
        and (iii) after the occurrence of an Event of Default, such additional dates
        as
        the Administrative Agent shall require; and (b) with respect to any Letter
        of
        Credit, each of the following: (i) each date of issuance of a Letter of Credit
        denominated in an Alternative Currency, (ii) each date of an amendment of
        any
        such Letter of Credit having the effect of increasing the amount thereof
        (solely
        with respect to the increased amount), (iii) each date of any payment by
        the
        Issuing Bank under any Letter of Credit denominated in an Alternative Currency,
        and (iv) after the occurrence of an Event of Default, such additional dates
        as
        the Issuing Bank shall require.

       

      Revolving
        Credit Commitment.  Means the sum of the Commitments of each
        Lender to make Revolving Credit Loans and purchase participations in L/C
        Extensions relating to Letters of Credit (subject to the applicable Letter
        of
        Credit Sub-limit) in an aggregate principal amount not to exceed the Dollar
        Equivalent of Fifty Million Dollars ($50,000,000) outstanding at any time,
        as
        such amount may be adjusted from time to time in accordance with this Agreement
        (including, without limitation, under §§2.1.2 or 2.1.8).

       

      
        
          
          

        

        
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      Revolving
        Credit Exposure.  Means, with respect to any Lender at any time,
        the sum of the outstanding principal amount of such Lender’s Revolving Credit
        Loans and L/C Obligations.

       

      Revolving
        Credit Facility.  Means the revolving credit loan facility
        provided by the Lenders to the U.S. Borrowers and the Foreign
        Borrowers.

       

      Revolving
        Credit Lenders.  The Lenders set forth on Schedule 2 hereto
        as Revolving Credit Lenders, acting in their role as makers of Revolving
        Credit
        Loans or as participants with respect to Letters of Credit to the U.S. Borrowers
        or Foreign Borrowers, together with any other Person who becomes an assignee
        of
        any rights and obligations of a Revolving Credit Lender pursuant to § 14.6 and
        any Acceding Lender who becomes a Lender pursuant to § 2.1.8.

       

      Revolving
        Credit Loans.  Means Revolving Credit Loans made or to be made by
        the Lenders to the U.S. Borrowers and the Foreign Borrowers pursuant to §2.1
        hereof.

       

      Revolving
        Credit Notes.  Means the promissory notes of the U.S. Borrowers
        and Foreign Borrowers evidencing the Revolving Credit Loans dated as of the
        date
        hereof.

       

      Seller
        Subordinated Debt.  Means unsecured Indebtedness of any of the
        Borrowers in an amount to be agreed upon by the Lenders and the Borrowers
        and
        otherwise on terms reasonably acceptable to the Lenders’ and, in any case, which
        has been fully subordinated and made junior to the payment and performance
        in
        full in cash of the Obligations as evidenced by a subordination agreement
        in
        form and substance satisfactory to the Lenders in their discretion;
provided that, (a) at the time such Seller Subordinated Debt is incurred,
        no Default or Event of Default has occurred or would occur as a result of
        such
        incurrence, and (b) the documentation evidencing such Seller Subordinated
        Debt
        shall have been delivered in advance and consented to by the
        Lenders.

       

      Spot
        Rate.  Means, for a currency, the rate reasonably determined by
        the Administrative Agent to be the rate quoted by the Person acting in such
        capacity as the spot rate for the purchase by such Person of such currency
        with
        another currency through its principal foreign exchange trading office at
        approximately 11:00 a.m. Boston, Massachusetts time on the date two (2) Business
        Days prior to the date as of which the foreign exchange computation is made;
        provided that the Administrative Agent may obtain such spot rate from another
        financial institution designated by the Administrative Agent if the Person
        acting in such capacity does not have as of the date of determination a spot
        buying rate for any such currency; and provided further that the Administrative
        Agent may use such spot rate quoted on the date as of which the foreign exchange
        computation is made in the case of any Letter of Credit denominated in an
        Alternative Currency.

       

      Subsidiary.  Means
        any corporation, association, trust, or other business entity of which the
        designated parent shall as of the date of any determination own directly
        or
        indirectly through a Subsidiary or Subsidiaries at least a majority of the
        outstanding Capital Stock or other interest entitled to vote
        generally.

       

      Swap
        Contract.  Means (a) any and all rate swap transactions, basis
        swaps, credit derivative transactions, forward rate transactions, commodity
        swaps, commodity options, forward commodity contracts, equity or equity index
        swaps or options, bond or bond price or bond index swaps or options or forward
        bond or forward bond price or forward bond index transactions, interest rate
        options, forward foreign exchange transactions, cap transactions, floor
        transactions, collar transactions, currency swap transactions, cross-currency
        rate swap transactions, currency options, spot contracts, or any other similar
        transactions or any combination of any of the foregoing (including any options
        to enter into any of the foregoing), whether or not any such transaction
        is
        governed by or subject to any master agreement, and

       

      
        
          
          

        

        
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      (b)
        any
        and all transactions of any kind, and the related confirmations, which are
        subject to the terms and conditions of, or governed by, any form of master
        agreement published by the International Swaps and Derivatives Association,
        Inc., any International Foreign Exchange Master Agreement, or any other master
        agreement (any such master agreement, together with any related schedules,
        a
“Master Agreement”), including any such obligations or liabilities under any
        Master Agreement.

       

      Swap
        Termination Value.  Means, in respect of any one or more Swap
        Contracts, after taking into account the effect of any legally enforceable
        netting agreement relating to such Swap Contracts, (a) for any date on or
        after
        the date such Swap Contracts have been closed out and termination value(s)
        determined in accordance therewith, such termination value(s), and (b) for
        any
        date prior to the date referenced in clause (a), the amount(s) determined
        as the
        mark-to-market value(s) for such Swap Contracts, as determined based upon
        one or
        more mid-market or other readily available quotations provided by any recognized
        dealer in such Swap Contracts (which may include the Administrative Agent
        or any
        Affiliate of the Administrative Agent).

       

      Swing
        Line Advances.  Means a Base Rate Loan made by the Swing Line
        Lender pursuant to §2.4.

       

      Swing
        Line Lender.  Means Citizens Bank of Massachusetts.

       

      Swing
        Line Facility.  Has the meaning set forth in §2.3(a).

       

      Swing
        Loan Purchase Price.  Has the meaning set forth in
§2.3(c).

       

      TARGET.  Means
        the Trans-European Automated Real-time Gross Settlement Express Transfer
        (TARGET) payment system (or, if such payment system ceases to be operative,
        such
        other payment system (if any) reasonably determined by the Administrative
        Agent
        to be a suitable replacement) for the settlement of payments in
        euro.

       

      Taxes.  Means
        all present or future taxes, levies, imposts, duties, deductions, withholdings,
        assessments, fees or other charges imposed by any Governmental Authority,
        including any interest, additions to tax or penalties applicable
        thereto.

       

      Term
        Loan.  Means the term loan made or to be made by the Lenders to
        the Term Loan Borrower pursuant to §4.1 hereof.

       

      Term
        Loan Borrower.  Means the Canadian Borrower which is the obligor
        with respect to the Term Loan as identified on Schedule 1
        hereto.

       

      Term
        Loan Lenders.  The Lenders holding a portion of the Term Loan as
        set forth on Schedule 2 hereto together with any other Person who becomes
        an assignee of any rights and obligations of a Term Loan Lender pursuant
        to §
14.6.

       

      Term
        Notes.  Means the promissory notes of the Term Loan Borrower
        evidencing the Term Loan dated as of the date hereof issued pursuant to §4.2
        hereof.

       

      Total
        Outstandings.  Means the aggregate Outstanding Amount of (a) all
        Revolving Credit Loans and L/C Obligations plus (b) the Term Loan
plus (c) the Canadian Revolving Credit Loans.

       

      Type.  Means,
        with respect to a Loan, its character as a Base Rate Loan, Canadian Base
        Rate
        Loan, Eurodollar Rate Loan or CDOR Rate Loan.

       

      
        
          
          

        

        
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      Unused
        Commitment Fee.  Has the meaning set forth in §5.4.

       

      Unreimbursed
        Amount.  Has the meaning set forth in §2.2.3(b).

       

      U.S.
        Borrowers.  Means any Borrower that is organized under the laws of
        the United States or any state thereof now existing or formed after the date
        hereof and is listed on Schedule 1 hereto as of the date hereof or is
        designated as a U.S. Borrower pursuant to §8.9(b).

       

      U.S.
        Guarantor.  Means any Affiliate of the Borrowers that (a) is not a
        Borrower, and (b) is organized under the laws of the United States or any
        state
        thereof now existing or formed after the date hereof.

       

      U.S.
        Obligations.  Means the Indebtedness and all other Obligations of
        any kind of the U.S. Borrowers to the Administrative Agent and the Lenders
        under
        this Agreement or any other Loan Document existing as of the date hereof
        or
        arising hereafter.

       

      U.S.
        Subsidiary.  Means any Subsidiary that is organized under the laws
        of the United States or any state thereof now existing or formed after the
        date
        hereof.

       

      §
        1.2  Rules of Interpretation.

       

      (a)           A
        reference to any document or agreement shall include such document or agreement
        as amended, modified or supplemented from time to time in accordance with
        its
        terms and the terms of this Agreement.

       

      (b)           The
        singular includes the plural and the plural includes the singular.

       

      (c)           A
        reference to any law includes any amendment or modification to such
        law.

       

      (d)           A
        reference to any Person includes its permitted successors and permitted
        assigns.

       

      (e)           Accounting
        terms capitalized but not otherwise defined herein have the meanings assigned
        to
        them by generally accepted accounting principles applied on a consistent
        basis
        by the accounting entity to which they refer.

       

      (f)           The
        words “include”, “includes” and “including” are not limiting.

       

      (g)           Reference
        to a particular “§” refers to that section of this Agreement unless otherwise
        indicated.

       

      (h)           The
        words “herein”, “hereof”, “hereunder” and words of like import shall refer to
        this Agreement as a whole and not to any particular section or subdivision
        of
        this Agreement.

       

      §
        1.3  Exchange Rates; Currency. 

       

      (a)           The
        Administrative Agent shall determine the Spot Rates as of each Revaluation
        Date
        to be used for calculating Dollar Equivalent amounts of Credit Extensions
        and
        Outstanding Amounts denominated in Alternative Currencies.  Such Spot
        Rates shall become effective as of such Revaluation Date and shall be the
        Spot
        Rates employed in converting any amounts between the applicable currencies
        until
        the next Revaluation Date to occur.  Except for purposes of financial
        statements delivered by the Borrowers and the other Loan Parties hereunder
        or
        calculating financial covenants hereunder or except as

       

      
        
          
          

        

        
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      otherwise
        provided herein, the applicable amount of any currency (other than Dollars)
        for
        purposes of the Loan Documents shall be such Dollar Equivalent amount as
        so
        determined by the Administrative Agent.

       

      (b)           Wherever
        in this Agreement in connection with a borrowing, conversion, continuation
        or
        prepayment of a Eurodollar Rate Loan or CDOR Rate Loan or the issuance,
        amendment or extension of a Letter of Credit, an amount, such as a required
        minimum or multiple amount, is expressed in Dollars, but such Advance,
        Eurodollar Rate Loan, CDOR Rate Loan or Letter of Credit is denominated in
        an
        Alternative Currency, such amount shall be the relevant Alternative Currency
        Equivalent of such Dollar amount (rounded to the nearest unit of such
        Alternative Currency, with 0.5 of a unit being rounded upward), as determined
        by
        the Administrative Agent.

       

      §
        1.4  Additional Alternative Currencies. 

       

      (a)           The
        Borrowers may from time to time request that Eurodollar Rate Loans be made
        and/or Letters of Credit be issued in a currency other than those specifically
        listed in the definition of “Alternative Currency;” provided that such requested
        currency is a lawful currency (other than Dollars) that is readily available
        and
        freely transferable and convertible into Dollars.  Each such request
        shall be subject to the approval of the Lenders (not to be unreasonably withheld
        or delayed).

       

      (b)           Any
        such request shall be made to the Administrative Agent not later than 11:00
        a.m., seven (7) Business Days prior to the date of the desired Credit Extension
        (or such other time or date as may be agreed by the Administrative
        Agent).

       

      (c)           Any
        failure by a Lender to respond to such request within the time period specified
        in the preceding sentence shall be deemed to be a refusal by such Lender
        to
        permit Eurodollar Rate Loans or CDOR Rate Loans, as applicable, to be made
        or
        Letters of Credit to be issued in such requested currency.  If the
        Administrative Agent and the Lenders consent to making Eurodollar Rate Loans
        in
        such requested currency, the Administrative Agent shall so notify the Borrowers
        and such currency shall thereupon be deemed for all purposes to be an
        Alternative Currency hereunder for purposes of any borrowings of, as applicable,
        Eurodollar Rate Loans; and if all of the Lenders consent to the issuance
        of
        Letters of Credit in such requested currency, the Administrative Agent shall
        so
        notify the Borrowers and such currency shall thereupon be deemed for all
        purposes to be an Alternative Currency hereunder for purposes of any Letter
        of
        Credit issuances.  If the Administrative Agent shall fail to obtain
        consent to any request for an additional currency under this §1.4, it shall
        promptly so notify the Borrowers.

       

      §
        1.5  Change of Currency. 

       

      (a)           Each
        obligation of the Borrowers to make a payment denominated in the national
        currency unit of any member state of the European Union that adopts the Euro
        as
        its lawful currency after the date hereof shall be redenominated into Euro
        at
        the time of such adoption (in accordance with the EMU
        Legislation).  If, in relation to the currency of any such member
        state, the basis of accrual of interest expressed in this Agreement in respect
        of that currency shall be inconsistent with any convention or practice in
        the
        London interbank market for the basis of accrual of interest in respect of
        the
        Euro, such expressed basis shall be replaced by such convention or practice
        with
        effect from the date on which such member state adopts the Euro as its lawful
        currency; provided that if any borrowing in the currency of such member state
        is
        outstanding immediately prior to such date, such replacement shall take effect,
        with respect to such borrowing, at the end of the then current Interest
        Period.

       

      (b)           Each
        provision of this Agreement shall be subject to such reasonable changes of
        construction as the Administrative Agent may from time to time specify to
        be
        appropriate to reflect the

       

      
        
          
          

        

        
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      adoption
        of the Euro by any member state of the European Union and any relevant market
        conventions or practices relating to the Euro.

       

      (c)           Each
        provision of this Agreement also shall be subject to such reasonable changes
        of
        construction as the Administrative Agent may from time to time specify to
        be
        appropriate to reflect a change in currency of any other country and any
        relevant market conventions or practices relating to the change in
        currency.

       

      §
        2.  THE MULTICURRENCY REVOLVING CREDIT
        FACILITY.

       

      §
        2.1  The Revolving Credit Facility.

       

      Subject
        to the Terms and conditions set forth herein, the Revolving Credit Lenders
        shall
        provide a multicurrency revolving credit facility to the U.S. Borrowers and
        Foreign Borrowers in the form of the Revolving Credit Facility.

       

      §
        2.1.1  Commitment to Lend Revolving
        Credit.  

       

      (a)           Subject
        to the terms and conditions set forth in this Agreement, each Revolving Credit
        Lender severally agrees to lend to the U.S. Borrowers and the U.S. Borrowers
        may
        borrow, repay, and reborrow from time to time during the period commencing
        on
        the Closing Date and ending on the Business Day immediately preceding the
        Maturity Date, upon notice by the U.S. Borrowers to the Administrative Agent
        given in accordance with §2.1.4, such sums as are requested by the U.S.
        Borrowers in Dollars or one or more Alternative Currencies, in an aggregate
        principal amount at any time outstanding (after giving effect to the requested
        Loan) not to exceed such Revolving Credit Lender’s Revolving Credit Commitment;
        provided that (i) the Outstanding Amount of the Revolving Credit Loans plus
        the
        Outstanding Amount of the L/C Obligations relating to Letters of Credit shall
        not exceed the Revolving Credit Commitment, (ii) the Outstanding Amount of
        the
        Revolving Credit Loans of any Revolving Credit Lender, plus such Revolving
        Credit Lender’s Applicable Percentage of the Outstanding Amount of all L/C
        Obligations relating to Letters of Credit shall not exceed such Revolving
        Credit
        Lender’s Revolving Credit Commitment, and (iii) the Outstanding Amount of all
        Loans denominated in Alternative Currencies shall not exceed the Alternative
        Currency Sublimit.  The Revolving Credit Loans to the U.S. Borrowers
        shall be made pro rata in accordance with each Revolving Credit Lender’s
        Applicable Percentage of the Revolving Credit Commitment.  Each
        request for a Revolving Credit Loan hereunder shall constitute a representation
        and warranty by the U.S. Borrowers that the conditions set forth in §6, as
        applicable, have been satisfied on the date of such request.

       

      (b)           Subject
        to the terms and conditions set forth in this Agreement, the Revolving Credit
        Lenders agree to lend to each of the Foreign Borrowers and each applicable
        Foreign Borrower may borrow, repay, and reborrow from time to time during
        the
        period commencing on the Closing Date and ending on the Business Day immediately
        preceding the Maturity Date, upon notice by the applicable Foreign Borrower
        to
        the Administrative Agent given in accordance with §2.1.4, such sums as are
        requested by such Foreign Borrower in U.S. Dollars or one or more Alternative
        Currencies, in an aggregate principal amount at any time outstanding (after
        giving effect to the requested Loan) not to exceed the Foreign Sublimit;
        provided that (i) the Outstanding Amount of the Revolving Credit Loans plus
        the
        Outstanding Amount of the L/C Obligations relating to Letters of Credit shall
        not exceed the Revolving Credit Commitment, (ii) the Outstanding Amount of
        the
        Revolving Credit Loans of any Revolving Credit Lender, plus such Revolving
        Credit Lender’s Applicable Percentage of the Outstanding Amount of all L/C
        Obligations relating to Letters of Credit shall not exceed such Revolving
        Credit
        Lender’s Revolving Credit Commitment, (iii) the Outstanding Amount of all Loans
        denominated in Alternative Currencies shall not exceed the Alternative Currency
        Sublimit, and (iv) the Outstanding

       

      
        
          
          

        

        
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      Amount
        of
        all Loans made to the Foreign Borrowers shall not exceed the Foreign
        Sublimit.  The Revolving Credit Loans to the Foreign Borrowers shall
        be made pro rata in accordance with each Revolving Credit Lender’s Applicable
        Percentage of the Revolving Credit Commitment.  Each request for a
        Revolving Credit Loan hereunder shall constitute a representation and warranty
        by the applicable Foreign Borrower that the conditions set forth in §6, as
        applicable, have been satisfied on the date of such request.

       

      §
        2.1.2  Termination or Reduction of Revolving Credit
        Commitment.

       

      The
        U.S.
        Borrowers and Foreign Borrowers may, upon notice to the Administrative Agent,
        terminate the Revolving Credit Commitment, or from time to time permanently
        reduce the Revolving Credit Commitment, whereupon the Revolving Credit
        Commitments of the Revolving Credit Lenders shall be reduced pro rata in
        accordance with their respective Applicable Percentage of the Revolving Credit
        Commitment; provided that (i) any such notice shall be received by the
        Administrative Agent not later than 1:00 p.m. (Boston time), five (5) Business
        Days prior to the date of termination or reduction, (ii) any such partial
        reduction shall be in a minimum amount of $1,000,000, (iii) the U.S. Borrowers
        and Foreign Borrowers shall not terminate or reduce the Revolving Credit
        Commitment if, after giving effect thereto and to any concurrent prepayments
        hereunder, the Outstanding Amount of the Revolving Credit Loans plus the
        Outstanding Amount of all L/C Obligations relating to Letters of Credit would
        exceed the Revolving Credit Commitment, (iv) if, after giving effect to any
        reduction of the Revolving Credit Commitment, the Letter of Credit Sublimit
        shall exceed the amount of the Revolving Credit Commitment, such Letter of
        Credit Sublimit shall be automatically reduced by the amount of such excess;
        and
        (v) if, after giving effect to any reduction of the Revolving Credit Commitment,
        the Alternative Currency Sublimit shall exceed the amount of the Revolving
        Credit Commitment, such Alternative Currency Sublimit shall be automatically
        reduced by the amount of such excess.

       

      §
        2.1.3  The Revolving Credit Notes.  

       

      The
        Revolving Credit Loans shall be evidenced by separate Revolving Credit Notes
        of
        the U.S. Borrowers and the Foreign Borrowers in form and substance satisfactory
        to the Revolving Credit Lenders (provided, that the Foreign Borrowers’
obligations under the Revolving Credit Notes shall not exceed the Foreign
        Sublimit).  The Revolving Credit Notes shall be payable to the order
        of each Revolving Credit Lender in an amount equal to the Revolving Credit
        Commitment of such Revolving Credit Lender, or, if less, the outstanding
        principal amount of all Revolving Credit Loans made by such Revolving Credit
        Lender, plus interest accrued thereon.   Each of the U.S.
        Borrowers and Foreign Borrowers irrevocably authorizes each Revolving Credit
        Lender to make or cause to be made, in connection with a Drawdown Date of
        any
        Revolving Credit Loan or Honor Date of any Letter of Credit or at the time
        of
        receipt of any payment of principal on the Revolving Credit Note, an appropriate
        notation on such Revolving Credit Lender’s records reflecting the making of the
        Revolving Credit Loan or the receipt of such payment (as the case may be)
        and
        whether such Revolving Credit Loan was made to the U.S. Borrowers or Foreign
        Borrowers, and will, prior to any transfer of such Revolving Credit Lender’s
        Revolving Credit Note, endorse on the reverse side thereof the outstanding
        principal amount of the Revolving Credit Loans evidenced thereby at the time
        of
        such transfer.  The Outstanding Amount of the Revolving Credit Loans
        set forth on a Revolving Credit Lender’s record shall be prima facie evidence
        (absent manifest error) of the principal amount thereof owing and unpaid
        to such
        Revolving Credit Lender, but the failure to record, or any error in so
        recording, any such amount shall not limit or otherwise affect the obligations
        of the U.S. Borrowers and/or Foreign Borrowers hereunder or under the Revolving
        Credit Note to make payments of principal of or interest on the Revolving
        Credit
        Note when due.

       

      §
        2.1.4  Requests for Revolving Credit
        Loans.  

       

      
        
          
          

        

        
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      (a)           The
        U.S. Borrowers or Foreign Borrowers, as the case may be, shall give to the
        Administrative Agent written notice in the form of Exhibit B hereto (or
        telephonic notice confirmed in writing or a telecopy in such form) of each
        Revolving Credit Loan requested hereunder (a “Loan Request”) not later
        than 10:00 a.m. (Boston time) (i) on the Business Day of the proposed Drawdown
        Date of any Base Rate Loan which is denominated in Dollars; (ii) three (3)
        Eurodollar Business Days prior to the Drawdown Date of any Eurodollar Rate
        Loan,
        (iii) four (4) Business Days prior to the Drawdown Date with respect to
        Alternative Currencies consisting of Euros, and (iv) five (5) Business Days
        with
        respect to other Alternative Currencies.

       

      (b)           Each
        such Loan Request shall specify (i) the principal amount of the Revolving
        Credit
        Loan requested, (ii) the currency in which such Revolving Credit Loan shall
        be
        denominated; (iii) the proposed Drawdown Date of such Revolving Credit Loan,
        (iv) the Interest Period for such Revolving Credit Loan (if such Revolving
        Credit Loan is to be a Eurodollar Rate Loan), and (v) whether such Revolving
        Credit Loan is to be a Eurodollar Rate Loan or a Base Rate Loan, and shall
        include a current Loan Request.  Each Revolving Credit Loan requested
        shall be in a minimum amount of $500,000 or its Dollar Equivalent, and, if
        such
        Loan requested is not a Base Rate Loan, shall be irrevocable and binding
        on the
        U.S. Borrowers, and shall obligate the U.S. Borrowers to accept the Loan
        requested from the Revolving Credit Lender on the proposed Drawdown
        Date.

       

      §
        2.1.5  Funds for Revolving Credit Loans.  

       

      (a)           Not
        later than 1:00 p.m. (Boston time) on the proposed Drawdown Date of any
        Revolving Credit Loan, each of the Revolving Credit Lenders will make available
        to the Administrative Agent, at the Administrative Agent’s Office, in
        immediately available funds, the amount of such Revolving Credit Lender’s
        Applicable Percentage of the requested Revolving Credit Loans.  Upon
        receipt from each Revolving Credit Lender of such amount, and upon receipt
        of
        the documents required by §6, as applicable, and the satisfaction of the other
        conditions set forth therein, to the extent applicable, the Administrative
        Agent
        will make available to the applicable U.S. Borrowers or Foreign Borrower,
        not
        later than 2:00 p.m. (Boston time) on the proposed Drawdown Date, in immediately
        available funds, the aggregate amount of such Revolving Credit Loans made
        available to the Administrative Agent by the Revolving Credit
        Lenders.  The failure or refusal of any Revolving Credit Lender to
        make available to the Administrative Agent at the aforesaid time and place
        on
        any Drawdown Date the amount of such Revolving Credit Lender’s Applicable
        Percentage of the requested Revolving Credit Loans shall not relieve any
        other
        Revolving Credit Lender from its several obligation hereunder to make available
        to the Administrative Agent the amount of such other Revolving Credit Lender’s
        Applicable Percentage of any requested Revolving Credit Loans.

       

      (b)           The
        Administrative Agent may, unless notified to the contrary by any Revolving
        Credit Lender prior to a Drawdown Date, assume that such Revolving Credit
        Lender
        has made available to the Administrative Agent on such Drawdown Date the
        amount
        of such Revolving Credit Lender’s Applicable Percentage of the Revolving Credit
        Loans to be made on such Drawdown Date, and the Administrative Agent may
        (but
        shall not be required to), in reliance upon such assumption, make available
        to
        the Borrowers a corresponding amount.  If any Revolving Credit Lender
        makes available to the Administrative Agent such amount on a date after such
        Drawdown Date, such Revolving Credit Lender shall pay to the Administrative
        Agent on demand an amount equal to the product of (i) the average computed
        for
        the period referred to in clause (iii) below, of the weighted average interest
        rate paid by the Administrative Agent for federal funds acquired by the
        Administrative Agent during each day included in such period, times (ii)
        the
        amount of such Revolving Credit Lender’s Applicable Percentage of such Revolving
        Credit Loans, times (iii) a fraction, the numerator of which is the number
        of
        days that elapse from and including such Drawdown Date to the date on which
        the
        amount of such Revolving Credit Lender’s Applicable Percentage of such Revolving
        Credit Loans shall become immediately available to

       

      
        
          
          

        

        
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      the
        Administrative Agent, and the denominator of which is 365.  A
        statement of the Administrative Agent submitted to such Revolving Credit
        Lender
        with respect to any amounts owing under this paragraph shall be prima facie
        evidence (absent manifest error), of the amount due and owing to the
        Administrative Agent by such Revolving Credit Lender.  If the amount
        of such Revolving Credit Lender’s Applicable Percentage of such Revolving Credit
        Loans is not made available to the Administrative Agent by such Revolving
        Credit
        Lender within three (3) Business Days following such Drawdown Date, the
        Administrative Agent shall be entitled to recover such amount from the U.S.
        Borrowers on demand, with interest thereon at the rate per annum applicable
        to
        the Revolving Credit Loans made on such Drawdown Date.

       

      §
        2.1.6  Maturity of the Revolving Credit
        Loans.  

       

      The
        Revolving Credit Loans shall be due and payable on the applicable Maturity
        Date.  Each of the U.S. Borrowers and Foreign Borrowers, as
        applicable, promises to pay in full in cash, on the Maturity Date, all Revolving
        Credit Loans outstanding on such date, together with any and all accrued
        and
        unpaid interest thereon and any fees and other amounts owing hereunder with
        respect to the Revolving Credit Loans.

       

      §
        2.1.7  Mandatory Repayments of the Revolving Credit
        Loans.  

       

          If
        at any
        time an Overadvance shall exist (whether as a result of fluctuations in currency
        exchange rates with respect to the Revolving Credit Facility or otherwise),
        then
        the applicable Borrowers shall immediately pay the amount of such Overadvance
        to
        the Administrative Agent for application to the Revolving Credit
        Loans.

       

      §
        2.1.8  Increase in Revolving Credit Commitment.

       

      (a)           Request
        for Increase of Revolving Credit Commitments.  Provided there
        exists no Event of Default, upon written notice to Administrative Agent and
        subject to the provisions of this § 2.1.8, the applicable Borrowers may from
        time to time request an increase in the Revolving Credit Commitment in minimum
        amount of Ten Million Dollars ($10,000,000), so long as, after giving effect
        thereto, the aggregate amount of such increases does not exceed Twenty Five
        Million Dollars ($25,000,000) in the aggregate.

       

      (b)           Lender
        Elections to Revolving Credit Commitments Increase.  The
        Administrative Agent will promptly notify the Lenders following receipt of
        a
        request by the Borrowers of an increase in the Revolving Credit
        Commitment.  At the time of making such request, the Borrowers (in
        consultation with the Administrative Agent) shall specify the time period
        within
        which each Revolving Credit Lender is requested to respond (which shall not,
        in
        any event, be less than ten (10) Business Days from the date of delivery
        of such
        notice to the Lenders).  Each Revolving Credit Lender shall notify the
        Administrative Agent within such time period whether or not it agrees to
        increase its Revolving Credit Commitment, and, if so, whether by an amount
        equal
        to, greater than, or less than its Revolving Percentage of such requested
        increase.  Any Revolving Credit Lender not responding within such time
        period shall be deemed to have declined to increase its Revolving Credit
        Commitment.

       

      (c)           Notification
        by Administrative Agent; Acceding Lenders.  The Administrative
        Agent shall notify the Borrowers and each Lender of the Revolving Credit
        Lenders’ responses to each request made hereunder.  To achieve the
        full amount of a requested increase and subject to the approval of the
        Administrative Agent and the Issuing Bank, which approvals shall not be
        unreasonably withheld or delayed, the Borrowers may also invite one or more
        additional commercial banks, other recognized financial institutions or other
        Persons (in each case, an “Acceding Lender”) to become
        party to this

       

      
        
          
          

        

        
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      Agreement
        as a Revolving Credit Lender by entering into an Instrument of Accession
        in
        substantially the form of Exhibit F hereto (an
“Instrument of Accession”) with the Borrowers and the Administrative
        Agent and assuming thereunder the rights and obligations of a Revolving Credit
        Lender hereunder, including without limitation, commitments to make Revolving
        Credit Loans and participate in the risk relating to Letters of Credit, and
        the
        Aggregate Commitments shall be funded (each such increase or funding, as
        the
        case may be, referred to as a “Post-Closing Increase”) by the amount of
        such Acceding Lender’s interest all in accordance with the provisions of this
        Section. The Borrowers shall indemnify the applicable Lenders and the
        Administrative Agent for any cost or expense incurred as a consequence of
        the
        reallocation of any Eurodollar Rate Loans to an Acceding Lender pursuant
        to the
        provisions of § 5.9 hereof.

       

      (d)           Closing
        Date and Allocations.  Upon a request by the Borrowers of an
        increase in the Revolving Credit Commitments in accordance with this Section,
        the Administrative Agent and the Borrowers shall determine, as applicable,
        the
        effective date of any such increase (any such date, the “Increase Closing
        Date”) and the final allocation of any such increase.  The
        Administrative Agent shall promptly notify the Borrowers and the Lenders
        (and
        Acceding Lenders, if any) of the final allocation of such
        increase.  On the Increase Closing Date, Schedule 2 hereto
        shall be deemed to be amended to reflect, as the case may be, (i) the name,
        address and Revolving Credit Commitment of the Revolving Credit Lenders (and,
        if
        applicable, any Acceding Lender), (ii) the Revolving Credit Commitments (after
        giving effect to any Post-Closing Increase), and (iii) the changes to the
        respective Applicable Percentages of the Revolving Credit Lenders.

       

      (e)           Conditions
        to Effectiveness of Increase of Revolving Credit Loans.  As a
        condition precedent to such increase in the Revolving Credit Commitments,
        the
        Borrowers shall deliver to the Administrative Agent a certificate dated as
        of
        the Increase Closing Date signed by a Responsible Officer of the Borrowers
        (i)
        certifying and attaching the resolutions adopted by the applicable Borrowers
        approving or consenting to such increase, and (ii) certifying that, before
        and
        after giving effect to such increase, the applicable conditions set forth
        in
§ 6 will be satisfied.  In addition, the Borrowers shall prepay
        any Revolving Credit Loans outstanding on any Increase Closing Date (and
        pay any
        additional amounts required under § 5 of this Agreement) to the extent
        necessary to keep the outstanding Revolving Credit Loans ratable with any
        revised Applicable Percentages in respect of Revolving Credit Loans arising
        from
        any nonratable increase in the Commitments under this Section.

       

      (f)           Conflicting
        Provisions.  This § 2.1.8 shall supersede any provisions in
§§ 14.1(b) or 14.11 to the contrary.

       

      §
        2.1.9  Designation of Foreign Borrowers.

       

       LoJack
        may, from time to time,
        designate any Eligible Foreign Subsidiary as a Foreign Borrower by delivery
        to
        the Administrative Agent of  (a) joinder agreement in substantially
        the form attached hereto as Exhibit G executed by such Foreign Subsidiary
        (or execution of an amendment to this Credit Agreement, if applicable) and
        any
        other applicable Loan Documents, in form and substance satisfactory to the
        Administrative Agent, providing that such Foreign Subsidiary shall become
        a
        Borrower hereunder, and (b) providing such other documentation as the
        Administrative Agent may reasonably request, including, without limitation,
        documentation with respect to the conditions specified in §6 hereof, including
        customary legal opinions of LoJack’s and such Foreign Subsidiary’s domestic
        counsel.

       

      §
        2.2  Letters of Credit.

       

      §
        2.2.1  Letters of Credit Commitment.

       

      
        
          
          

        

        
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      (a)           Subject
        to the terms and conditions set forth herein, the Issuing Bank agrees (i)
        (1)
        from time to time on any Business Day during the period from the Closing
        Date
        until the applicable Letter of Credit Expiration Date, to issue Letters of
        Credit denominated in Dollars or Alternative Currencies for the account of
        any
        of the U.S. Borrowers or any of the Foreign Borrowers under the Revolving
        Credit
        Facility (each, a “Letter of Credit” and, collectively, the “Letters
        of Credit”) and to amend or renew Letters of Credit previously issued by it,
        in accordance with subsection (b) below, and (2) to honor drafts under the
        Letters of Credit; and (ii) the Revolving Credit Lenders severally agree
        to
        participate in Letters of Credit; provided, that the Issuing Bank shall not
        be
        obligated to make any L/C Credit Extension with respect to any Letter of
        Credit
        if, as of the date of such L/C Credit Extension and after giving effect to
        such
        request, (w) the Outstanding Amount of Revolving Credit Loans plus the
        Outstanding Amount of L/C Obligations relating to Letters of Credit would
        exceed
        the Revolving Credit Commitment; (x) the Outstanding Amount of Revolving
        Credit
        Loans of any Revolving Credit Lender plus such Lender’s Applicable Percentage of
        the Outstanding Amount of all L/C Obligations relating to Letters of Credit
        exceeds such Lender’s Revolving Credit Commitment, (y) the Outstanding Amount of
        L/C Obligations with respect to Letters of Credit would exceed the applicable
        Letter of Credit Sublimit or (z) the Outstanding Amount of all Loans denominated
        in Alternative Currencies plus the Outstanding Amount of all L/C Obligations
        for
        Letters of Credit denominated in Alternative Currencies shall exceed the
        Alternative Currency Sublimit; provided, however, if the Issuing
        Bank is requested to issue Letters of Credit with respect to a jurisdiction
        the
        Issuing Bank deems, in its reasonable judgment, may at any time subject it
        to a
        New Money Credit Event or a Country Risk Event, the applicable Borrowers
        shall,
        at the request of the Issuing Bank, guaranty and indemnify the Issuing Bank
        against any and all costs, liabilities and losses resulting from such New
        Money
        Credit Event or Country Risk Event, in each case in a form and substance
        reasonably satisfactory to the Issuing Bank.

       

      (b)           The
        Issuing Bank shall be under no obligation to issue any Letter of Credit
        if:

       

      (i)           any
        order, judgment or decree of any Governmental Authority shall by its terms
        purport to enjoin or restrain the Issuing Bank from issuing such Letter of
        Credit, or any law applicable to the Issuing Bank or any request or directive
        (whether or not having the force of law) from any Governmental Authority
        with
        jurisdiction over the Issuing Bank shall prohibit, or request that the Issuing
        Bank refrain from, the issuance of letters of credit generally or such Letter
        of
        Credit in particular or shall impose upon the Issuing Bank with respect to
        such
        Letter of Credit any restriction, reserve or capital requirement (for which
        the
        Issuing Bank is not otherwise compensated hereunder) not in effect on the
        Closing Date, or shall impose upon the Issuing Bank any unreimbursed loss,
        cost
        or expense which was not applicable on the Closing Date and which the Issuing
        Bank in good faith deems material to it;

       

      (ii)           Subject
        to §2.2.2(c), the expiry date of such requested Letter of Credit would occur
        more than twelve months after the date of issuance or last renewal;

       

      (iii)           the
        expiry date of such requested Letter of Credit would occur after the Letter
        of
        Credit Expiration Date;

       

      (iv)           the
        issuance of such Letter of Credit would violate one or more policies of the
        Issuing Bank; or

       

      (v)           such
        Letter of Credit is in an initial amount less than $100,000, or is to be
        used
        for a purpose other than working capital and general corporate purposes or
        denominated in a currency other than Dollars or an Alternative
        Currency.

       

      
        
          
          

        

        
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      (c)           The
        Issuing Bank shall be under no obligation to amend any Letter of Credit if
        (i)
        the Issuing Bank would have no obligation at such time to issue such Letter
        of
        Credit in its amended form under the terms hereof, or (ii) the beneficiary
        of
        such Letter of Credit does not accept the proposed amendment to such Letter
        of
        Credit.

       

      §
        2.2.2  Procedures for Issuance and Amendment of Letters of Credit;
        Auto-Renewal Letters of Credit.

       

      (a)           Each
        Letter of Credit shall be issued or amended, as the case may be, upon the
        request of the applicable U.S. Borrower or Foreign Borrower delivered to
        the
        Issuing Bank in the form of a Letter of Credit Application, appropriately
        completed and signed by a Responsible Officer of such U.S. Borrower or Foreign
        Borrower as set forth below.  Such Letter of Credit Application must
        be received by the Issuing Bank not later than 1:00 p.m. (Boston time), at
        least
        two Business Days (or such later date and time as the Issuing Bank may agree
        in
        a particular instance in its sole discretion) prior to the proposed issuance
        date or date of amendment, as the case may be.

       

      (i)           In
        the case of a request for an initial issuance of a Letter of Credit, such
        Letter
        of Credit Application shall specify in form and detail satisfactory to the
        Issuing Bank: (A) the proposed issuance date of the requested Letter of Credit
        (which shall be a Business Day); (B) the amount thereof; (C) the expiry date
        thereof; (D) the name and address of the beneficiary thereof; (E) the documents
        to be presented by such beneficiary in case of any drawing thereunder; (F)
        the
        full text of any certificate to be presented by such beneficiary in case
        of any
        drawing thereunder; and (G) such other matters as the Issuing Bank may require;
        and

       

      (ii)           in
        the case of a request for an amendment of any outstanding Letter of Credit,
        such
        Letter of Credit Application shall specify in form and detail satisfactory
        to
        the Issuing Bank (A) the Letter of Credit to be amended; (B) the proposed
        date
        of amendment thereof (which shall be a Business Day); (C) the nature of the
        proposed amendment; and (D) such other matters as the Issuing Bank may require
        in accordance with the Issuing Bank’s usual and customary practices effective as
        of the time of such request.

       

      (b)           Upon
        the Issuing Bank’s determination that the requested issuance or amendment is
        permitted in accordance with the terms hereof, then, subject to the terms
        and
        conditions hereof, the Issuing Bank shall, on the requested date, issue a
        Letter
        of Credit for the account of such U.S. Borrower or Foreign Borrower or enter
        into the applicable amendment, as the case may be, in each case in accordance
        with the Issuing Bank’s usual and customary business
        practices.  Immediately upon the issuance of each Letter of Credit,
        each Revolving Credit Lender shall be deemed to, and hereby irrevocably and
        unconditionally agrees to, purchase from the Issuing Bank a risk participation
        in such Letter of Credit in an amount equal to the product of such Revolving
        Credit Lender’s Applicable Percentage times the face amount of such Letter of
        Credit.

       

      (c)           If
        a U.S. Borrower or Foreign Borrower so requests in any applicable Letter
        of
        Credit Application, the Issuing Bank may, in its sole and absolute discretion,
        agree to issue a Letter of Credit that has automatic renewal provisions (each,
        an “Auto-Renewal Letter of Credit”); provided that any such Auto-Renewal Letter
        of Credit must permit the Issuing Bank to prevent any such renewal at least
        once
        in each twelve-month period (commencing with the date of issuance of such
        Letter
        of Credit) by giving prior notice to the beneficiary thereof not later than
        a
        day in each such twelve-month period to be agreed upon at the time such Letter
        of Credit is issued.  Unless otherwise directed by the Issuing Bank,
        the U.S. Borrowers or Foreign Borrowers shall not be required to make a specific
        request to the Issuing Bank for any such renewal.  Once an
        Auto-Renewal Letter of Credit has been issued, the Issuing Bank shall, subject
        to the terms and conditions set forth herein, permit the renewal of such
        Letter
        of Credit to an

       

      
        
          
          

        

        
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      expiry
        date not later than the applicable Letter of Credit Expiration Date; provided,
        however, that the Issuing Bank shall have no obligation to permit the renewal
        of
        any Auto-Renewal Letter of Credit at any time if it has determined that it
        would
        have no obligation at such time to issue such Letter of Credit in its renewed
        form under the terms hereof (by reason of the provisions of §2.2.1(b) or
        otherwise).

       

      (d)           Promptly
        after its delivery of any Letter of Credit or any amendment to a Letter of
        Credit to an advising bank with respect thereto or to the beneficiary thereof,
        the Issuing Bank will also deliver to the applicable U.S. Borrower or Foreign
        Borrower a true and complete copy of such Letter of Credit or
        amendment.

       

      §
        2.2.3  Drawings and Reimbursements of Letters of Credit; Funding and
        Repayment of Participations.

       

      (a)           Upon
        receipt from the beneficiary of any Letter of Credit of any notice of a drawing
        under such Letter of Credit, the Issuing Bank shall notify the applicable
        U.S.
        Borrower or Foreign Borrower and the Administrative Agent
        thereof.  Not later than 1:00 p.m. (Boston time) on the Honor Date,
        such U.S. Borrower or Foreign Borrower shall reimburse the Issuing Bank through
        the Administrative Agent in an amount equal to the amount of such drawing
        and in
        the same currency as such drawing.

       

      (b)           If
        the applicable U.S. Borrowers or Foreign Borrowers fail to reimburse the
        Issuing
        Bank for any drawing under any Letter of Credit (the “Unreimbursed
        Amount”) on the Honor Date as set forth in §2.2.3(a), the Administrative
        Agent shall promptly notify each Revolving Credit Lender of the Honor Date,
        the
        Unreimbursed Amount and the amount of such Revolving Credit Lender’s Applicable
        Percentage thereof.  In such event, the applicable U.S. Borrowers or
        Foreign Borrowers shall be deemed to have made a Loan Request for a Base
        Rate
        Loan in Dollars to be disbursed on the Honor Date in an amount equal to the
        Dollar Equivalent of the Unreimbursed Amount calculated as of the Honor Date,
        without regard to the minimum and multiples specified in § 2.1.4 but subject to
        the Revolving Credit Commitment and the applicable conditions set forth in
§
6.  Any notice given by the Issuing Bank or the Administrative Agent
        pursuant to this § 2.2.3(b) may be given by telephone if immediately confirmed
        in writing, provided that the lack of such immediate confirmation shall not
        affect the conclusiveness or binding effect of such notice.

       

      (c)           Each
        Revolving Credit Lender shall, upon any notice pursuant to § 2.2.3(b), make
        funds available to the Administrative Agent for the account of the Issuing
        Bank
        at the Administrative Agent’s Office in an amount equal to its Applicable
        Percentage of the Unreimbursed Amount not later than 1:00 p.m. (Boston time)
        on
        the Business Day specified in such notice by the Administrative Agent,
        whereupon, subject to the provisions of §2.2.3(d), each such Lender that so
        makes funds available shall be deemed to have made a Base Rate Loan in Dollars
        to the applicable U.S. Borrower or Foreign Borrower, in such
        amount.  The Administrative Agent shall remit the funds so received to
        the Issuing Bank.

       

      (d)           With
        respect to any Unreimbursed Amount that is not fully refinanced by a Revolving
        Credit Loan because the applicable conditions set forth in §6 cannot be
        satisfied or for any other reason, the applicable U.S. Borrower or Foreign
        Borrower shall be deemed to have incurred from the Issuing Bank an L/C Borrowing
        in the amount of the Unreimbursed Amount that is not so refinanced, which
        L/C
        Borrowing shall be due and payable on demand (together with interest) and
        shall
        bear interest at the Default Rate.  In such event, each Revolving
        Credit Lender’s payment to the Administrative Agent for the account of the
        Issuing Bank pursuant to §2.2.3(c) shall be deemed payment in respect of its
        participation in such L/C Borrowing and shall constitute an L/C Advance from
        such Lender in satisfaction of its participation obligations under this
§2.2.3.

       

      
        
          
          

        

        
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      (e)           Until
        each Revolving Credit Lender funds its Applicable Percentage of, as the case
        may
        be, the Revolving Credit Loan or L/C Advance pursuant to this §2.2.3 to
        reimburse the Issuing Bank for any amount drawn under any Letter of Credit,
        interest in respect of such Lender’s Applicable Percentage of such amount shall
        be solely for the account of the Issuing Bank.

       

      (f)           The
        obligation of each Revolving Credit Lender to make a Revolving Credit Loan
        or
        L/C Advances to reimburse the Issuing Bank for amounts drawn under Letters
        of
        Credit, as contemplated by this §2.2.3, shall be absolute and unconditional and
        shall not be affected by any circumstance, including (i) any setoff,
        counterclaim, recoupment, defense or other right which such Lender may have
        against the Issuing Bank, any of the Borrowers or any other Person for any
        reason whatsoever; (ii) the occurrence or continuance of an Event of Default,
        or
        (iii) any other occurrence, event or condition, whether or not similar to
        any of
        the foregoing; provided, however, that each such Lender’s obligation to make
        Revolving Credit Loans pursuant to this §2.2.3 is subject to the applicable
        conditions set forth in §6.  No such making of an L/C Advance shall
        relieve or otherwise impair the obligation of the U.S. Borrowers or Foreign
        Borrowers, as applicable, to reimburse the Issuing Bank for the amount of
        any
        payment made by the Issuing Bank under any Letter of Credit, together with
        interest as provided herein.

       

      (g)           If
        any Revolving Credit Lender fails to make available to the Administrative
        Agent
        for the account of the Issuing Bank any amount required to be paid by such
        Lender pursuant to the foregoing provisions of this §2.2.3 by the time specified
        therein, the Issuing Bank shall be entitled to recover from such Lender (acting
        through the Administrative Agent), on demand, such amount with interest thereon
        for the period from the date such payment is required to the date on which
        such
        payment is immediately available to the Issuing Bank at a rate per annum
        equal
        to the greater of the Federal Funds Rate and a rate determined by the Issuing
        Bank in accordance with banking industry rules on interbank
        compensation.  A certificate of the Issuing Bank submitted to any
        Revolving Credit Lender (through the Administrative Agent) with respect to
        any
        amounts owing under this clause (g) shall be conclusive absent manifest
        error.

       

      (h)           At
        any time after the Issuing Bank has made a payment under any Letter of Credit
        and has received from any Revolving Credit Lender such Lender’s L/C Advance in
        respect of such payment in accordance with this §2.2.3, if the Administrative
        Agent receives for the account of the Issuing Bank any payment in respect
        of the
        related Unreimbursed Amount or interest thereon (whether directly from a
        U.S.
        Borrower or Foreign Borrower or otherwise, including proceeds of Cash Collateral
        applied thereto by the Administrative Agent), the Administrative Agent will
        distribute to such Lender its Applicable Percentage thereof (appropriately
        adjusted, in the case of interest payments, to reflect the period of time
        during
        which such Lender’s L/C Advance was outstanding) in the same funds as those
        received by the Administrative Agent.

       

      (i)           If
        any payment received by the Administrative Agent for the account of the Issuing
        Bank pursuant to §2.2.3 is required to be returned under any of the
        circumstances described in §14.5 (including pursuant to any settlement entered
        into by the Issuing Bank in its discretion), each Revolving Credit Lender
        shall
        pay to the Administrative Agent for the account of the Issuing Bank its
        Applicable Percentage thereof on demand of the Administrative Agent, plus
        interest thereon from the date of such demand to the date such amount is
        returned by such Revolving Credit Lender, at a rate per annum equal to the
        Federal Funds Rate from time to time in effect.  The obligations of
        the Revolving Credit Lenders under this clause (i) shall survive the payment
        in
        full of the Obligations and the termination of this Agreement.

       

      §
        2.2.4  Letters of Credit Obligations Absolute.

       

      (a)           The
        obligation of the U.S. Borrowers and Foreign Borrowers to reimburse the Issuing
        Bank for each drawing under each Letter of Credit shall be absolute,
        unconditional and irrevocable, and

       

      
        
          
          

        

        
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      shall
        be
        paid strictly in accordance with the terms of this Agreement under all
        circumstances, including the following:

       

      (i)           any
        lack of validity or enforceability of such Letter of Credit, this Agreement,
        or
        any other agreement or instrument relating thereto;

       

      (ii)           the
        existence of any claim, counterclaim, set-off, defense or other right that
        the
        U.S. Borrowers or Foreign Borrowers may have at any time against any beneficiary
        or any transferee of such Letter of Credit (or any Person for whom any such
        beneficiary or any such transferee may be acting), the Issuing Bank, the
        Administrative Agent, any of the Lenders or any other Person, whether in
        connection with this Agreement, the transactions contemplated hereby or by
        such
        Letter of Credit or any agreement or instrument relating thereto, or any
        unrelated transaction;

       

      (iii)           any
        draft, demand, certificate or other document presented under such 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; or any
        loss
        or delay in the transmission or otherwise of any document required in order
        to
        make a drawing under such Letter of Credit; or

       

      (iv)           any
        payment by the Issuing Bank under such Letter of Credit against presentation
        of
        a draft or certificate that does not strictly comply with the terms of such
        Letter of Credit; or any payment made by the Issuing Bank under such Letter
        of
        Credit to any Person purporting to be a trustee in bankruptcy,
        debtor-in-possession, assignee for the benefit of creditors, liquidator,
        receiver or other representative of or successor to any beneficiary or any
        transferee of such Letter of Credit, including any arising in connection
        with
        any proceeding under any Debtor Relief Law.

       

      (b)           The
        applicable U.S. Borrower or Foreign Borrower shall promptly examine a copy
        of
        each Letter of Credit and each amendment thereto that is delivered to it
        and, in
        the event of any claim of noncompliance with such the U.S. Borrower’s or Foreign
        Borrower’s instructions or other irregularity, such U.S. Borrower or Foreign
        Borrower, as applicable, will immediately notify the Issuing Bank in connection
        thereof.  Such U.S. Borrower or Foreign Borrower, as applicable, shall
        be conclusively deemed to have waived any such claim against the Issuing
        Bank
        and its correspondents unless such notice is given as aforesaid.

       

      §
        2.2.5  Role of Issuing Bank with Letters of
        Credit.   

       

      Each
        of
        the U.S. Borrowers and each of the Foreign Borrowers agrees that, in paying
        any
        drawing under a Letter of Credit, the Issuing Bank shall not have any
        responsibility to obtain any document (other than any sight draft, certificates
        and documents expressly required by the Letter of Credit) or to ascertain
        or
        inquire as to the validity or accuracy of any such document or the authority
        of
        the Person executing or delivering any such document.  Each of the
        U.S. Borrowers and each of the Foreign Borrowers hereby assumes all risks
        of the
        acts or omissions of any beneficiary or transferee with respect to its use
        of
        any Letter of Credit; provided, however, that this assumption is
        not intended to, and shall not, preclude the U.S. Borrowers or Foreign Borrowers
        from pursuing such rights and remedies as it may have against the beneficiary
        or
        transferee at law or under any other agreement.  None of the Issuing
        Bank, any of its Affiliates, any of the respective officers, directors,
        employees, agents or attorneys-in-fact of the Issuing Bank and its Affiliates,
        nor any of the respective correspondents, participants or assignees of the
        Issuing Bank shall be liable or responsible for any of the matters described
        in
        clause (a) of §2.2.4; provided, however, that anything in such clauses to the
        contrary notwithstanding, the U.S. Borrowers or Foreign Borrowers may have
        a
        claim against the Issuing Bank, and the Issuing Bank may be liable to the
        U.S.
        Borrowers or the Foreign Borrowers, to the extent, but only to the extent,
        of
        any direct, as opposed to

       

      
        
          
          

        

        
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      consequential
        or exemplary, damages suffered by the U.S. Borrowers or Foreign Borrowers,
        as
        applicable, which the U.S. Borrowers or Foreign Borrowers prove were caused
        by
        the Issuing Bank’s willful misconduct or gross negligence or the Issuing Bank’s
        willful failure to pay under any Letter of Credit after the presentation
        to it
        by the beneficiary of a sight draft and certificate(s) strictly complying
        with
        the terms and conditions of a Letter of Credit.  In furtherance and
        not in limitation of the foregoing, the Issuing Bank may accept documents
        that
        appear on their face to be in order, without responsibility for further
        investigation, regardless of any notice or information to the contrary, and
        the
        Issuing Bank shall not be responsible for the validity or sufficiency of
        any
        instrument transferring or assigning or purporting to transfer or assign
        a
        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.

       

      §
        2.2.6  Cash Collateral for Letters of
        Credit.    

       

      Upon
        the
        request of the Administrative Agent, if, as of the Letter of Credit Expiration
        Date or upon the occurrence and continuance of an Event of Default, any Letter
        of Credit may for any reason remain outstanding and partially or wholly undrawn,
        the applicable U.S. Borrowers or Foreign Borrowers shall immediately Cash
        Collateralize the then Outstanding Amount of all L/C Obligations in respect
        thereto.  Each of the U.S. Borrowers and each of the Foreign Borrowers
        hereby grants to the Administrative Agent, for the benefit of the Issuing
        Bank
        and the Lenders, a security interest in all such cash and all proceeds of
        the
        foregoing.  Cash collateral shall be maintained in blocked, interest
        bearing deposit accounts in the name of the Administrative Agent.

       

      §
        2.2.7  Applicability of ISP98 and UCP to Letters of
        Credit.  

       

      Unless
        otherwise expressly agreed by the Issuing Bank and, as applicable, the U.S.
        Borrowers or the Foreign Borrowers when a Letter of Credit is issued (including
        any such agreement applicable to an Existing Letter of Credit), (i) the rules
        of
        the “International Standby Practices 1998” published by the Institute of
        International Banking Law & Practice (or such later version thereof as may
        be in effect at the time of issuance) shall apply to each standby Letter
        of
        Credit, and (ii) the rules of the Uniform Customs and Practice for Documentary
        Credits, as most recently published by the International Chamber of Commerce
        (the “ICC”) at the time of issuance, shall apply to each commercial Letter of
        Credit.

       

      §
        2.2.8  Letter of Credit Fees.  

       

      Each
        applicable U.S. Borrower or Foreign Borrower shall pay to the Administrative
        Agent for the account of each Revolving Credit Lender a Letter of Credit
        fee for
        each standby Letter of Credit equal to the Applicable Margin for standby
        Letters
        of Credit times the daily amount available to be drawn under such standby
        Letter
        of Credit.  Such standby Letter of Credit fees shall be computed on a
        quarterly basis in arrears on the Dollar Equivalent of the Drawing
        Amount.  Such standby Letter of Credit fees shall be due and payable
        on the first Business Day after the end of each March, June, September and
        December of each calendar year, commencing with the first such date to occur
        after the issuance of such standby Letter of Credit, on the Letter of Credit
        Expiration Date and thereafter on demand.  Each applicable U.S.
        Borrower or Foreign Borrower shall pay to the Administrative Agent, for the
        account of the Issuing Bank, an amount with respect to each trade Letter
        of
        Credit equal to an amount determined by the Issuing Bank based on the Issuing
        Bank’s fees then in effect for such trade Letter of Credit.

       

      §
        2.2.9  Documentary and Processing Charges Payable to Issuing Bank for
        Letters of Credit.

       

      The
        applicable U.S. Borrowers or Foreign Borrowers shall pay to the Issuing Bank
        the
        customary issuance, presentation, amendment and other processing fees, and
        other
        standard costs and charges, of the

       

      
        
          
          

        

        
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      Issuing
        Bank relating to letters of credit as from time to time in
        effect.  Such customary fees and standard costs and charges are due
        and payable on demand and are nonrefundable.

       

      §
        2.2.10  Conflict with Letter of Credit
        Application.  

       

      In
        the
        event of any conflict between the terms in this Agreement and the terms of
        any
        Letter of Credit Application, the terms in this Agreement shall
        control.

       

      §
        2.3  Swing Line Facility.

       

      (a)           Subject
        to the terms and conditions set forth herein, and so long as no Event of
        Default
        has occurred, the U.S. Borrowers may request, pursuant to a notice in the
        form
        of Exhibit D attached hereto, the Swing Line Lender to make, and the
        Swing Line Lender may, if in its sole discretion it elects to do so, make,
        on
        the terms and conditions hereinafter set forth and in reliance upon the
        agreements of Lenders set forth in this Section 2.3, Swing Line Advances
        in
        Dollars to the U.S. Borrowers from time to time on any Business Day prior
        to the
        Maturity Date in an amount not to exceed $2,500,000 in the aggregate outstanding
        at any time (after giving effect to the Swing Line Advance requested) (the
        “Swing Line Facility”).  Each Swing Line Advance shall be in a
        minimum amount of $100,000 or an integral multiple of $500,000 in excess
        thereof
        and shall consist of a Base Rate Loan.

       

      (b)           Any
        Swing Line Advance not repaid by the Maturity Date shall be due and payable
        on
        such date.  Any Swing Line Advance not repaid on any date when due
        (other than the Maturity Date) shall be deemed to be a Revolving Credit Loan
        made pursuant to Section 2.1.1.

       

      (c)           In
        the event that any Swing Line Advance is not repaid when due, upon conversion
        of
        such Swing Line Advance to a Revolving Credit Loan, each other Revolving
        Credit
        Lender shall be deemed to have purchased from the Swing Line Lender, and
        the
        Swing Line Lender shall be deemed to have sold and assigned to each such
        other
        Revolving Credit Lender, such Revolving Credit Lender’s Applicable Percentage of
        such Revolving Credit Loan as of the date of such conversion (the “Swing Loan
        Purchase Price”), and upon notice from the Administrative Agent (a
“Notice of Purchase”) shall make available to the Administrative Agent
        for the account of the Swing Line Lender, in immediately available funds,
        an
        amount equal to the portion of the outstanding principal amount of such
        Revolving Credit Loan to be purchased by such Revolving Credit Lender on
        (i) the
        Business Day on which a Notice of Purchase is given, provided that such notice
        is given not later than 11:00 A.M. (Boston, Massachusetts time) on such Business
        Day, or (ii) the first Business Day next succeeding the date such notice
        is
        given.  If and to the extent that any such Revolving Credit Lender
        shall not have so made such Revolving Credit Lender’s Swing Loan Purchase Price
        available to the Administrative Agent, such Revolving Credit Lender agrees
        to
        pay to the Administrative Agent forthwith on demand for the account of the
        Swing
        Line Lender such amount together with interest thereon, for each day from
        the
        date such amount was due under this subsection (iii) until the date such
        amount
        is paid to the Administrative Agent, at the Federal Funds Rate.  The
        obligation of each Revolving Credit Lender to deliver to the Administrative
        Agent an amount equal to its respective participation pursuant to this section
        shall be absolute and unconditional and such remittance shall be made
        notwithstanding the occurrence or continuation of an Event of Default or
        the
        failure to satisfy any condition set forth in §6 of this Agreement.

       

      §
        3.  THE CANADIAN CREDIT FACILITY.

       

      §
        3.1  Definitions; Schedules.

       

      Schedule
        3.1-A and Schedule 3.1-B are incorporated into this § 3 (and, whenever
        applicable, this Credit Agreement) by reference.  Schedule 3.1-A
        contains definitions of capitalized terms used in this § 3

       

      
        
          
          

        

        
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      and
        not
        otherwise defined in this Credit Agreement.  Unless otherwise
        provided, all Dollar amounts used in this § 3 or in connection with the
        Canadian Credit Facility (as defined below) are in Canadian
        Dollars.

       

      §
        3.2  The Canadian Credit Facility.  

       

      Subject
        to the terms and conditions set forth in this § 3 and other applicable
        provisions of this Credit Agreement the Canadian Lender agrees to provide
        a
        revolving credit facility (the “Canadian Credit Facility”) to the
        Canadian Revolving Borrowers in Dollars or Canadian Dollars up to the amount
        of
        the Canadian Revolving Credit Commitment by way of:

       

      (a)           RBP
        based loans and/or overdrafts (“RBP Loans”);

       

      (b)           RBUSBR
        based loans and/or overdrafts in Dollars (“RBUSBR Loans”);

       

      (c)           Bankers’
        Acceptances (“BAs”);

       

      (d)           LIBOR
        based loans in Dollars (“Libor Loans”);

       

      (e)           Letters
        of Credit (“LCs”); and

       

      (f)           Letters
        of Guarantee (“LGs”).

       

      Each
        use
        of the Canadian Credit Facility is a “Borrowing” and all such usages outstanding
        at any time are “Borrowings”; the total amount of Borrowings outstanding at any
        time under the Canadian Credit Facility is the total amount of all RBP Loans,
        RBUSBR Loans and Libor Loans outstanding at that time plus the total face
        amount
        of all Bankers’ Acceptances outstanding at that time and the total amount of all
        LCs and LGs outstanding hereunder at that time. Schedule 3.1-B contains
        terms and conditions applicable to Borrowings made other than by way of RBP
        Loans or RBUSBR Loans, which must be complied with.

       

      §
        3.3  [Reserved]

       

      §
        3.4  Availability; Repayment.  

       

      (a)           Availability.  The
        Canadian Revolving Borrowers may borrow, convert, repay and re-borrow up
        to the
        amount of the Canadian Revolving Credit Commitment, provided an Event of
        Default
        shall not have occurred and be continuing at the time of any
        Borrowing.  Upon five (5) Business Days’ written notice to the
        Canadian Lender, the Canadian Revolving Borrowers may cancel any undrawn
        portion
        of the Canadian Credit Facility without penalty.  Any such
        cancellation is irrevocable and any amounts cancelled shall not be
        reinstated.

       

      (b)           Repayment.  Borrowings
        under the Canadian Credit Facility shall be repayable on the Maturity
        Date.

       

      §
        3.5  Interest Rates and Fees.  

       

      (a)           Loans
        under the Canadian Credit Facility shall bear interest at the following rates
        and BAs, LCs and LGs shall accrue the following fees:

       

      (i)           RBP
        Loans, at the rate of RBP plus 0% per annum;

       

      (ii)           RBUSBR
        Loans, at the rate of RBUSBR plus 0% per annum;

       

      
        
          
          

        

        
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      (iii)           BAs,
        at the Discount Rate plus the Acceptance Fee;

       

      (iv)           Libor
        Loans, at the rate of LIBOR plus the Applicable Margin then in effect per
        annum;

       

      (v)           LCs,
        a fee calculated using the Applicable Margin then in effect per annum;
        and

       

      (vi)           LGs,
        a fee calculated using the Applicable Margin then in effect per
        annum.

       

      (b)           Commitment
        Fee.  The Canadian Revolving Borrowers shall pay to the Canadian
        Lender a commitment fee quarterly in arrears on the last day of each fiscal
        quarter and on the Maturity Date at a rate per annum equal to the Applicable
        Margin then in effect, partial fiscal quarters pro rata.  This fee
        will be payable in Canadian Dollars and calculated quarterly on the unused
        and
        uncancelled portion of the Canadian Credit Facility from and including the
        date
        of this Agreement.

       

      (c)           RBP
        Loans and RBUSBR Loans.  The Canadian Revolving Borrowers shall
        pay to the Canadian Lender interest on each RBP Loan and RBUSBR Loan, monthly
        in
        arrears, on the last calendar day of each month.  Such interest will
        be calculated monthly and will accrue daily on the basis of the actual number
        of
        days elapsed and a year of 365 days, any change in the rate of interest
        applicable to any RBP Loan or RBUSBR Loan shall be effective as of the opening
        of business on the day such change takes place.  Interest on RBUSBR
        Loans shall be paid in Dollars and interest on any RBP Loans shall be paid
        in
        Canadian Dollars.

       

      (d)           LC
        Fees.  The Canadian Revolving Borrowers shall pay to the Canadian
        Lender the LC fee in relation to each LC issued hereunder in the currency
        in
        which each such LC is stated on the date of any payment made by the Canadian
        Lender pursuant to a drawing under any such LC calculated on the amount
        drawn.  If the total amount available under any such LC has not been
        drawn prior to the expiry of such LC, the Canadian Revolving Borrowers shall
        pay
        the LC fee calculated on the undrawn portion of such LC on the expiry date
        thereof.

       

      (e)           LG
        Fees.  The Canadian Revolving Borrowers shall pay to the Canadian
        Lender the LG fee in the currency (Dollars or Canadian Dollars) in which
        each
        such LG is stated (for other currencies, the LG fee will be paid in the
        currency’s Canadian Dollar equivalent) on the date of issuance of any such LG
        calculated on the face amount of such LG issued based upon the number of
        days in
        the term thereof and a year of 365 days.

       

      (f)           BAs.  The
        Canadian Revolving Borrowers shall pay to the Canadian Lender the Acceptance
        Fee
        in Canadian Dollars in advance on the date of issue of each
        BA.  Acceptance Fees shall be calculated on the face amount of each BA
        issued and based upon the number of days in the term thereof and a year of
        365 days.  The Canadian Revolving Borrowers authorize and direct
        the Canadian Lender to deduct from the Discounted Proceeds of BAs purchased
        by
        the Canadian Lender for its own account the amount of each such Acceptance
        Fee
        upon the issue of each BA.

       

      (g)           Libor
        Loans.  The Canadian Revolving Borrowers shall pay to the Canadian
        Lender interest in Dollars on each Libor Loan, on each Libor Interest Date,
        calculated in arrears.  Such interest will accrue daily on the basis
        of the actual number of days elapsed and a year of 360 days.

       

      (h)           Limit
        on Interest.  The Canadian Revolving Borrowers shall not be
        obligated to pay any interest, fees or costs under or in connection with
        this
        Agreement in excess of what is permitted by law.

       

      
        
          
          

        

        
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      (i)           Overdue
        Payments.  Any amount that is not paid when due hereunder in
        respect of the Canadian Credit Facility shall, unless interest is otherwise
        payable in respect thereof in accordance with the terms of this Credit Agreement
        or the instrument or contract governing same, bear interest until paid at
        the
        rate of RBP plus 2% in the case of an amount in Canadian Dollars per annum
        or,
        in the case of an amount in Dollars, RBUSBR plus 2% per annum.

       

      (j)           Upfront
        Fee.  The Canadian Revolving Borrowers shall pay to the Canadian
        Lender in cash on the date hereof an upfront non-refundable fee equal to
        Canadian $6,250.

       

      (k)           Equivalent
        Yearly Rates.  The annual rates of interest or fees to which the
        rates calculated in accordance with this § 3 are equivalent, are the rates
        so calculated multiplied by the actual number of days in the calendar year
        in
        which such calculation is made and divided by 365 or, in the case of Libor
        Loans, divided by 360.

       

      (l)           Time
        and Place of Payment.  Amounts payable by the Canadian Revolving
        Borrowers under the Canadian Credit Facility shall be paid in the applicable
        currency. Amounts due on a day other than a Business Day shall be deemed
        to be
        due on the Business Day next following such day.  Interest and fees
        payable under this § 3 are payable both before and after any or all of
        default, demand and judgment.  All payments by the Canadian Revolving
        Borrowers are to be made without set-off, compensation or counterclaim, and
        (subject to § 5.13) without any deduction or withholding for or on account
        of any tax.

       

      §
        3.6  Evidence of Indebtedness.  

       

      (a)           The
        Canadian Lender shall maintain accounts and records evidencing the Borrowings
        made available to each of the Canadian Revolving Borrowers by the Canadian
        Lender under this § 3. The Canadian Lender shall record the principal
        amount of each Borrowing, the payment of principal and interest and all other
        amounts becoming due to the Canadian Lender under this § 3.

       

      (b)           The
        Canadian Lender’s accounts and records constitute, in the absence of manifest
        error, prima facie evidence of the indebtedness of each of the Canadian
        Revolving Borrowers to the Canadian Lender pursuant to this
§ 3.

       

      (c)           Each
        Canadian Revolving Borrower authorizes and directs the Canadian Lender to
        automatically debit, by mechanical, electronic or manual means, any bank
        account
        of the Canadian Revolving Borrowers for all amounts payable under the Canadian
        Credit Facility, including, but not limited to the repayment of principal
        and
        the payment of interest, fees and all charges for the keeping of such bank
        account(s).

       

      §
        3.7  General Account.

       

      Each
        of
        the Canadian Revolving Borrowers shall each establish a current account with
        the
        Canadian Lender in Canadian Dollars and, if applicable, in Dollars (each
        a
“General Account”) for the conduct of each of the Canadian Revolving Borrowers’
day-to-day banking business.  If the balance in a General
        Account:

       

      (a)           is
        a credit, the Canadian Lender shall apply, at any time in its discretion,
        the
        amount of such credit or part thereof, rounded down to the nearest Can. $5,000
        in Canadian Dollars or Dollars, as applicable, as a repayment of Borrowings
        outstanding and due by way of RBP Loans or RBUSBR Loans, as applicable, under
        the Canadian Credit Facility, or

       

      
        
          
          

        

        
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      (b)           is
        a debit, the Canadian Lender may, subject to availability under this § 3,
        make available a Borrowing by way of an RBP Loan or RBUSBR Loans, as applicable,
        under the Canadian Credit Facility in an amount, rounded up to the nearest
        Can.
        $5,000  in Canadian Dollars or Dollars, as applicable, as is required
        to place the General Account at not less than a zero balance.

       

      §
        3.8  Exchange Rate Fluctuations

       

      If,
        for
        any reason, the amount of Borrowings outstanding under the Canadian Credit
        Facility, when converted to the Equivalent Amount in Canadian Dollars, exceeds
        the amount available under the Canadian Credit Facility, the Canadian Revolving
        Borrowers shall immediately repay such excess or shall secure such excess
        to the
        satisfaction of the Canadian Lender.

       

      §
        3.9  Indemnity

       

      Whether
        or not a Default or an Event of Default has occurred and without limiting
        the
        indemnification provisions elsewhere contained in this Agreement for the
        benefit
        of the Lenders, including the Canadian Lender, each of the Canadian Revolving
        Borrowers covenants and undertakes to indemnify, defend, protect and hold
        harmless the Canadian Lender and its directors, officers, employees, attorneys,
        trustees and agents (collectively, the “Indemnitees”) against and from
        all losses, damages, expenses, liabilities, obligations, penalties, actions,
        judgments, suits, claims, costs, expenses and disbursements (including
        reasonable attorneys' and consultants' fees and disbursements) (hereinafter,
        “Losses”) which any Indemnitee may sustain or incur (including, without
        limitation, any loss of profit and expenses the Canadian Lender may incur
        (a) by reason of the liquidation, re-employment or
        redeployment of deposits or other funds acquired by the Canadian Lender to
        fund
        or to maintain the Canadian Revolving Loans, (b) by reason of any interest,
        charges or other amounts paid or payable by the Canadian Lender to providers
        of
        funds borrowed or acquired in order to make, to fund or to maintain the Canadian
        Revolving Loans or any amount unpaid by the Canadian Revolving Borrowers
        hereunder or (c) by reason of the termination, or otherwise in connection
        with,
        any Letter of Credit as a consequence of or in connection with:

       

      (a)           any
        failure of the Canadian Revolving Borrowers to borrow in the amount and on
        the
        date specified therefor in any notice of Borrowing pursuant to this Agreement
        in
        respect of a Libor Loan or a Canadian Bankers’ Acceptance,

       

      (b)           any
        failure of the Canadian Revolving Borrowers to make a payment, repayment,
        prepayment or conversion specified in a notice of repay­ment, prepayment or
        conversion hereunder, or when otherwise due hereunder, in respect of a Libor
        Loan or a Canadian Bankers’ Acceptance, and

       

      (c)           the
        payment by the Canadian Revolving Borrowers of principal amounts in respect
        of a
        Libor Loan or a Canadian Bankers' Acceptance on any day other than the last
        day
        of the related Libor Interest Period or other than the date of maturity of
        such
        Canadian Bankers’ Acceptance, as the case may be,

       

      §
        4.  THE TERM LOAN.

       

      §
        4.1  The Term Loan; Commitment to Lend Term Loan.

       

      Subject
        to the terms and conditions set forth in this Agreement, each Term Loan Lender
        agrees to lend to the Term Loan Borrower on the Closing Date the amount of
        its
        Applicable Percentage of the principal amount of the Twenty Six Million Canadian
        Dollars (Can. $26,000,000) (the “Term Loan”).

       

      
        
          
          

        

        
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      §
        4.2  The Term Notes.

       

      The
        Term
        Loan shall be evidenced by separate promissory notes of the Term Loan Borrower
        in form and substance satisfactory to the Term Loan Lenders (each, a “Term
        Note”), dated as of the Closing Date (or such other date on which a Term
        Loan Lender may become a party hereto in accordance with §14.6 hereof) and
        completed with appropriate insertions.  The Term Loan Borrower
        irrevocably authorizes each Term Loan Lender to make or cause to be made,
        in
        connection with a change in interest rate with respect to any portion of
        the
        Term Loan pursuant to §5.2 or at the time of receipt of any payment of principal
        on the Term Loan, an appropriate notation on such Lender’s records reflecting
        the change in interest rate of any portion of the Term Loan or the receipt
        of
        such payment (as the case may be). The Outstanding Amount of the Term Loan
        set
        forth on each Term Loan Lender’s record shall be prima facie evidence (absent
        manifest error) of the principal amount thereof owing and unpaid to each
        Lender,
        but the failure to record, or any error in so recording, any such amount
        shall
        not limit or otherwise affect the obligations of the Term Loan Borrower
        hereunder or under the Term Loan to make payments of principal of or interest
        on
        the Term Loan when due.

       

      §
        4.3  Maturity of the Term Loan.  

       

      The
        Term
        Loan shall mature and shall be due and payable on the applicable Maturity
        Date.  The Term Loan Borrower promises to pay on the Maturity Date,
        and there shall become absolutely due and payable on the Maturity Date, the
        principal amount of the Term Loan outstanding on such date, together with
        any
        and all accrued and unpaid interest thereon and any other amounts owing
        hereunder.

       

      §
        4.4  [Reserved.]  

       

      §
        4.5  Interest on Term Loan.  

       

      Except
        as
        forth in §5.12, the Term Loan shall bear interest during each Interest Period
        relating to all or a portion (as applicable) of the Term Loan at the following
        rates:

       

      (a)           To
        the extent that the Term Loan Borrower has elected all or any portion of
        the
        Term Loan to be a Canadian Base Rate Loan, the Term Loan or such portion
        thereof, shall bear interest during such Interest Period at the Canadian
        Base
        Rate.

       

      (b)           To
        the extent that all or a portion of the Term Loan bears interest during such
        Interest Period at the CDOR Rate, the Term Loan or such portion thereof shall
        bear interest during such Interest Period at the rate per annum equal to
        the
        CDOR Rate plus the Applicable Margin determined for such Interest Period
        as in effect from time to time.

       

      (c)           The
        Term Loan Borrower promises to pay interest on the Term Loan or any portion
        thereof outstanding during each Interest Period in arrears on each Interest
        Payment Date applicable to such Interest Period.

       

      §
        4.6  5/25 Savings Clause.

       

      Each
        of
        the Term Loan Lenders, the Administrative Agent and the Term Loan Borrower
        agree
        that, except upon the occurrence of an Event of Default, notwithstanding
        any
        other provision herein contained, in no event shall the aggregate amount
        of
        optional or mandatory repayments of principal by the Term Loan Borrower in
        respect of the Term Loan prior to the Maturity Date exceed twenty-five percent
        (25%) of the aggregate of the principal amounts of that Loan.

       

      
        
          
          

        

        
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      §
        5.  PROVISIONS RELATING TO ALL LOANS.

       

      The
        following provisions are applicable
        to all Loans unless the context requires otherwise, provided 
that, §§ 5.1 to 5.7 shall not apply to the Canadian Revolving Credit
        Loans:

       

      §
        5.1  Interest on Loans. 

       

      (a)           The
        outstanding principal amount of the Revolving Credit Loans shall bear interest
        at (i) the Base Rate (except for Revolving Credit Loans in Alternative
        Currencies), or (ii) the Adjusted Eurodollar Rate plus the Applicable
        Margin for each Interest Period, in accordance with the applicable Borrowers’
election under §5.2.  The outstanding principal amount of the Swing
        Line Advances will bear interest at the applicable Base Rate.

       

      (b)           The
        outstanding principal amount of the Term Loan shall bear interest at the
        rate
        provided for in §4.5.

       

      (c)           Interest
        shall be payable in arrears (x) based on a 360-day year on the Interest Payment
        Date for Eurodollar Rate Loans, (y) based on a 365/366-day year on the Interest
        Payment Date for CDOR Rate Loans, and (z) on the applicable Maturity Date
        with
        respect to each of the Loans.

       

      §
        5.2  Election of Interest Rate; Notice of Election; Interest Periods;
        Minimum Amounts.

       

      (a)           At
        the applicable Borrowers’ option, so long as no Event of  Default has
        occurred and is then continuing:

       

      (b)           with
        respect to Revolving Credit Loans, the U.S. Borrowers may (1) elect at any
        time
        to convert any Base Rate Loan or a portion thereof to a Eurodollar Rate Loan,
        or
        (2) upon expiration of the applicable Interest Period, elect to maintain
        an
        existing Eurodollar Rate Loan as such, or convert such Eurodollar Rate Loan
        to a
        Base Rate Loan, provided that the U.S. Borrowers give notice to the
        Administrative Agent pursuant to §5.2(d) hereof; and provided,
further, that Loans in Alternative Currencies may not be converted
        to
        Base Rate Loans; and

       

      (c)           with
        respect to the Term Loan, the Term Loan Borrower may, (1) elect at any time
        to
        convert any Canadian Base Rate Loan or a portion thereof to a CDOR Rate Loan,
        or
        (2) upon expiration of the applicable Interest Period, elect to maintain
        an
        existing CDOR Rate Loan as such, or convert such CDOR Rate Loan to a Canadian
        Base Rate Loan, provided that the Term Loan Borrower give notice to the
        Administrative Agent pursuant to §5.2(d) hereof

       

      (d)           Each
        Loan shall initially be the type of Loan specified prior to the making thereof
        and shall bear interest at the applicable rate, determined as provided herein,
        until (i) in the case of a Eurodollar Rate Loan or CDOR Rate Loan, the end
        of
        the initial Interest Period applicable thereto; or (ii) in the case of a
        Base
        Rate Loan or Canadian Base Rate Loan, the date on which such Loan is repaid
        in
        full or the type of interest rate applicable thereto is changed pursuant
        to
§5.2(c).

       

      (e)           Each
        Borrower may from time to time elect to change the type of interest rate
        borne
        by any Loan or, in the case of a Eurodollar Rate Loan or CDOR Rate Loan,
        continue the type of interest rate borne by such, as applicable, Eurodollar
        Rate
        Loan or CDOR Rate Loan for an additional Interest Period (subject, in each
        case,
        to the following):

       

      (i)           with
        respect to Base Rate Loans or Canadian Base Rate Loans, the election shall
        be
        effective on any Business Day; and

       

      
        
          
          

        

        
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      (ii)           with
        respect to Eurodollar Rate Loans or CDOR Rate Loans, the election shall be
        effective on the day following the last day of the applicable Interest
        Period

       

      (f)           Three
        (3) Business Days prior to the conversion of any Base Rate Loan to a Eurodollar
        Rate Loan or Canadian Base Rate Loan to a CDOR Rate Loan, or in the case
        of an
        outstanding Eurodollar Rate Loan or CDOR Rate Loan, the expiration date of
        the
        applicable Interest Period, the applicable Borrower shall give written, telex
        or
        telecopy notice received by the Administrative Agent not later than 10:00
        a.m.
        (Boston time) of its election pursuant to §5.2(a).  Each such notice
        delivered to the Administrative Agent shall, specify the aggregate principal
        amount of the Loan to be maintained as or converted to, as applicable, a
        Eurodollar Rate Loan or CDOR Rate Loan, and the requested duration of the
        Interest Period that will be applicable to such Eurodollar Rate Loan or CDOR
        Rate Loan, and shall be irrevocable and binding upon such
        Borrower.  If the applicable Borrower shall fail to give the
        Administrative Agent notice hereunder together with all of the other information
        required by this §5.2(d) with respect to any Loan, whether at the end of an
        Interest Period or otherwise, such Loan shall be deemed to be (1) for Revolving
        Credit Loans or any portion thereof, a LIBOR Rate Loan with an Interest Period
        of one month and (2) for the Term Loan, the Canadian Revolving Credit Loan,
        or
        any portion thereof, a CDOR Rate Loan with an Interest Period of one
        month.

       

      (g)           All
        Eurodollar Rate Loans shall be in a minimum amount of the Dollar Equivalent
        of
        $500,000.

       

      (h)           All
        CDOR Rate Loans shall be in a minimum amount of Can. $1,000,000 and in multiples
        of Can. $100,000.

       

      §
        5.3  Optional Prepayments or Repayments of the
        Loans.  

       

      Subject
        to §4.6 in respect of the Term Loan, the Borrowers shall have the right, at
        their election, to repay or prepay the Outstanding Amount of the Loans, as
        a
        whole or in part, at any time without penalty or premium.  The
        Borrowers shall give the Administrative Agent, (a) no later than 10:00 a.m.
        (Boston time) on the Business Day of such proposed prepayment or repayment
        of
        any Base Rate Loan or Canadian Base Rate Loan and (b) no later than 1:00
        p.m.
        (Boston time) three (3) Business Days prior to any proposed prepayment or
        repayment of any Eurodollar Rate Loan or CDOR Rate Loan written notice (or
        telephonic notice confirmed in writing) of any proposed prepayment or repayment
        pursuant to this §5.3, specifying the proposed date of prepayment or repayment
        of the Loans and the principal amount to be paid (in integral multiples of
        $500,000); provided, that any applicable Borrowers may not make any prepayment
        of any Loan on a date other than the Interest Payment Date unless, in connection
        with any such prepayment, such Borrowers reimburse the Administrative Agent
        for
        the benefit of the Lenders pursuant to §5.9.  Amounts prepaid or
        repaid with respect to the Term Loan may not be reborrowed.

       

      §
        5.4  Fees. 

       

      (a)           The
        applicable Borrowers agree to pay to the Administrative Agent in cash on
        the
        Closing Date, for the ratable account of each Lender, an upfront fee equal
        to
        0.125% of the sum of (i) Revolving Credit Commitment plus (ii) the
        principal amount of the Term Loan, each as of the Closing Date.

       

      (b)           The
        applicable Borrowers agree to pay to the Administrative Agent for the ratable
        account of each Lender making Revolving Credit Loans, a commitment fee (the
        “Commitment Fee”), which shall accrue at the rate per annum which is
        equal to the applicable percentages set forth under the heading “Commitment Fee”
in the table contained in the definition of Applicable Margin on the average
        daily amount of the Available Revolving Credit Commitment of such Lender
        during
        the period from and

       

      
        
          
          

        

        
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      including
        the Effective Date to but excluding the date on which such Revolving Credit
        Commitment terminates; provided that, if such Lender continues to have
        any Revolving Credit Exposure after its Revolving Credit Commitment terminates,
        then such Commitment Fee shall continue to accrue on the amount of such Lender’s
        Revolving Credit Exposure from and including the date on which its Revolving
        Credit Commitment terminates to but excluding the date on which such Lender
        ceases to have any Revolving Credit Exposure.  Accrued Commitment Fees
        shall be payable in arrears on the last day of March, June, September and
        December of each year and on the date on which the Revolving Credit Commitments
        terminate, commencing on the first such date to occur after the date hereof;
        provided that any Commitment Fees accruing after the date on which the
        Revolving Credit Commitments terminate shall be payable on
        demand.  All Commitment Fees shall be computed on the basis of a year
        of 360 days and shall be payable for the actual number of days elapsed
        (including the first day but excluding the last day).  For purposes of
        calculating the Commitment Fee for any period during which Loans in Dollars
        and
        Alternative Currencies were outstanding, the Administrative Agent shall use
        the
        Dollar Equivalent of such Alternative Currencies, calculated on the basis
        of the
        Spot Rate for such Alternative Currencies, on or as of the most recent
        Revaluation Date provided for in § 1.3(a).

       

      §
        5.5  Payments.

       

      (a)           All
        payments of principal, interest, fees and any other amounts due hereunder
        or
        under any of the other Loan Documents shall be made to the Administrative
        Agent
        at the Administrative Agent’s Office for the respective accounts of the Lenders
        and the Administrative Agent, in immediately available funds, as follows:
        (i) in
        respect of Loans made in Dollars, in Dollars, and (ii) in respect of Loans
        made
        in an Alternate Currency, in the Alternate Currency in which such Loan was
        made.  Whenever a payment hereunder or under any of the other Loan
        Documents becomes due on a day that is not a Business Day, the due date for
        such
        payment shall be extended to the next succeeding Business Day, and interest
        shall accrue during such extension.

       

      (b)           All
        payments to be made by the Borrowers shall be made without condition or
        deduction for any counterclaim, defense, recoupment or setoff and free and
        clear
        of and without deduction or withholding for any taxes, levies, imposts,
        assessments, duties, charges, deductions, withholdings (including to the
        extent
        provided in Section 5.13, any withholding taxes or other charges imposed
        as a
        direct result of any of the Lenders’ non-resident status), compulsory loans,
        restrictions or conditions of any nature now or hereafter imposed or levied
        by
        any jurisdiction, authority, agency or any political subdivision thereof
        or
        taxing or other authority therein unless the applicable Borrower is compelled
        by
        law to make such deduction or withholding.  If any such obligation is
        imposed upon any Borrower with respect to any amount payable by it hereunder
        or
        under any of the other Loan Documents, such Borrower will pay to the
        Administrative Agent, for the account of the Lenders and the Administrative
        Agent, on the date on which such amount is due and payable hereunder or under
        such other Loan Document, such additional amount as shall be necessary to
        enable
        the Lenders to receive the same net amount which the Lenders would have received
        on such due date had no such obligation been imposed upon such
        Borrower.  Each Borrower will deliver promptly to the Administrative
        Agent certificates or other valid vouchers for all taxes or other charges
        deducted from or paid with respect to payments made by the Borrowers hereunder
        or under such other Loan Document.

       

      §
        5.6  Computations.

       

      (a)           All
        computations of interest on Base Rate Loans and of any fees shall, unless
        otherwise expressly provided herein, be based on a 360-day year, and shall
        be
        paid for the actual number of days elapsed.  All computations of
        interest on Eurodollar Rate Loans, CDOR Rate Loans, the Commitment Fee and
        other
        fee calculations shall be based on a 360-day year and paid for the actual
        number
        of days elapsed.  Interest shall accrue on each Loan for the day on
        which the Loan is made, and shall not accrue

       

      
        
          
          

        

        
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      on
        a
        Loan, or any portion thereof, for the day on which the Loan or such portion
        is
        paid, provided that any Loan that is repaid on the same day on which it is
        made
        shall, bear interest for one day.

       

      (b)           For
        the purposes of the Interest Act (Canada), any amount of interest or fees
        calculated herein using 360, 365 or 366 days per year and expressed as an
        annual
        rate is equal to the said rate of interest or fees multiplied by the actual
        number of days comprised within the calendar year, divided by 360, 365 or
        366,
        as the case may be.  The parties agree that all interest accruing with
        respect to the Term Loan will be calculated using the nominal rate method
        and
        not the effective rate method, and that the deemed re-investment principle
        shall
        not apply to such calculations.  In addition, the parties acknowledge
        that there is a material distinction between the nominal and effective rates
        of
        interest and that they are capable of making the calculations necessary to
        compare such rates.

       

      §
        5.7  Interest on Overdue Amounts; Default
        Rate.  

       

      Overdue
        principal and (to the extent permitted by applicable law) interest on the
        Loans
        and all other overdue amounts payable hereunder or under any of the other
        Loan
        Documents shall bear interest compounded monthly and payable on demand at
        a rate
        per annum equal to the applicable rate for such Loan plus two percentage
        points
        (2.0%) until such amount shall be paid in full (after as well as before
        judgment).  During the continuance of an Event of Default hereunder,
        the Loans shall bear interest at the rate per annum equal to the applicable
        rate
        for such Loan plus two percentage points (2.0%) (the “Default
        Rate”).

       

      §
        5.8  Interest Limitation.  

       

      Notwithstanding
        any other term of this Agreement or the Notes or any other document referred
        to
        herein or therein, the maximum amount of interest which may be charged to
        or
        collected from any person liable hereunder or under the Notes by the Lenders
        shall be absolutely limited to, and shall in no event exceed, the maximum
        amount
        of interest which could lawfully be charged or collected under applicable
        law
        (including, to the extent applicable, the provisions of the Criminal Code
        of
        Canada and Section 5197 of the Revised Statutes of the United States of America,
        as amended, 12 U.S.C. Section 85, as amended), so that the maximum of all
        amounts constituting interest under applicable law, howsoever computed, shall
        never exceed as to any Person liable therefor such lawful maximum, and any
        term
        of this Agreement, any Note or any other document referred to herein or therein
        which could be construed as providing for interest in excess of such lawful
        maximum shall be and hereby is made expressly subject to and modified by
        the
        provisions of this paragraph.

       

      §
        5.9  Funding Losses.  

       

      (a)           Upon
        demand of any Lender from time to time, the Borrowers shall promptly compensate
        each such Lender for and hold each such Lender harmless from any loss, and
        pay
        to such Lender an amount (the “Eurodollar Breakage Fee”), as calculated
        by each such Lender, equal to the amount of any losses, costs, expense and/or
        liabilities incurred by it as a result of:

       

      (i)           any
        continuation, conversion, payment or prepayment of any Loan other than a
        Base
        Rate Loan on a day other than the last day of the Interest Period for such
        Loan
        (whether voluntary, mandatory, automatic, by reason of acceleration, or
        otherwise); or

       

      (ii)           any
        failure by the applicable Borrowers (for a reason other than the failure
        of the
        applicable Lender to make a Loan) to prepay, borrow, continue or convert
        any
        Loan other than a Base Rate Loan on the date or in the amount notified by
        the
        applicable Borrower, including any loss of anticipated profits and any loss
        or
        expense arising from the liquidation or reemployment

       

      
        
          
          

        

        
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      of
        funds
        obtained by it to maintain such Loan or from fees payable to terminate the
        deposits from which such funds were obtained.  The Borrowers shall
        also pay any customary administrative fees charged by the Lender and the
        Administrative Agent in connection with the foregoing.

       

      (b)           For
        purposes of calculating the Eurodollar Breakage Fee payable by the Borrowers
        to
        a Lender under this §5.9, the applicable Lender shall be deemed to have funded
        (i) each Eurodollar Rate Loan at the Eurodollar Rate, whether or not such
        Eurodollar Rate Loan was in fact so funded, and (ii) each CDOR Rate Loan
        at the
        CDOR Rate, whether or not such CDOR Rate Loan was in fact so
        funded.

       

      (c)           Each
        of the Borrowers understands, agrees and acknowledges that: (i) none of the
        Lenders have any obligation to purchase, sell and/or match funds in connection
        with the use of the Eurodollar Rate as a basis for calculating the rate of
        interest on a Eurodollar Rate Loan, (ii) the Eurodollar Rate may be used
        merely
        as a reference in determining such rate, and (iii) each of the Borrowers
        has
        accepted the Eurodollar Rate as a reasonable and fair basis for calculating
        the
        Eurodollar Breakage Fee and other funding losses incurred by the
        Lenders.  Each of the Borrowers further agrees to pay the Eurodollar
        Breakage Fee and other funding losses, if any, whether or not the applicable
        Lenders elect to purchase, sell and/or match funds.

       

      §
        5.10  Illegality.  

       

      If
        any
        Lender determines that any law has made it unlawful, or that any Governmental
        Authority has asserted that it is unlawful, for such Lender or its Lending
        Office to make, maintain or fund Eurodollar Rate Loans or CDOR Rate Loans,
        or to
        determine or charge interest rates based upon the Eurodollar Rate or CDOR
        Rate,
        then, on notice thereof by such Lender to the applicable Borrower, any
        obligation of such Lender to make or continue Eurodollar Rate Loans or CDOR
        Rate
        Loans or to convert, as the case may be Base Rate Loans to Eurodollar Rate
        Loans
        or Canadian Base Rate Loans to CDOR Rate Loan shall be suspended with respect
        to
        such Borrower until the Lender notifies the applicable Borrower that the
        circumstances giving rise to such determination no longer exist.  Upon
        receipt of such notice, the applicable Borrower shall, upon demand from such
        Lender, prepay or convert all Eurodollar Rate Loans to Base Rate Loans in
        Dollars or CDOR Rate Loans to Canadian Base Rate Loans, either on the last
        day
        of the Interest Period therefor, if such Lender may lawfully continue to
        maintain such Eurodollar Rate Loans or CDOR Rate Loans to such day, or
        immediately, if the Lender may not lawfully continue to maintain such Eurodollar
        Rate Loans or CDOR Rate Loans.  Upon any such prepayment or
        conversion, the applicable Borrower shall also pay accrued interest on the
        amount so prepaid or converted.  The applicable Lender agrees to
        designate a different Lending Office if such designation will avoid the need
        for
        such notice and will not, in the good faith judgment of the Lender, otherwise
        be
        materially disadvantageous to the Lender.

       

      §
        5.11  Inability to Determine Eurodollar Rate or CDOR
        Rate.  

       

        If
        the Administrative Agent or any
        Lender determines that for any reason adequate and reasonable means do not
        exist
        for determining the Eurodollar Rate or CDOR Rate for any requested Interest
        Period with respect to a proposed Eurodollar Rate Loan or CDOR Rate Loan,
        that
        the Eurodollar Rate or CDOR Rate for any requested Interest Period with respect
        to, as applicable, a proposed Eurodollar Rate Loan or CDOR Rate Loan does
        not
        adequately and fairly reflect the cost to such Lender or the Administrative
        Agent of funding such Loan, then such Lender or the Administrative Agent
        will
        promptly so notify the Borrowers.  Upon such notification by such
        Lender or the Administrative Agent, the obligation of such Lender or the
        Administrative Agent to make or maintain Eurodollar Rate Loans or CDOR Rate
        Loans shall be suspended until such Lender or the Administrative Agent revokes
        such notice.  Upon receipt of such notice, the Borrowers may revoke
        any pending request for a borrowing of, conversion to or continuation of
        a
        Eurodollar Rate Loan Rate Loan or CDOR Rate Loan or, failing that,

       

      
        
          
          

        

        
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      will
        be
        deemed to have converted such request into a request for a borrowing of,
        as
        applicable, a Base Rate Loan in Dollars or Canadian Base Rate Loan in Canadian
        Dollars in the Dollar Equivalent of the amount specified therein.  The
        agreements in this §5.11 shall survive the termination of the Commitments and
        repayment, satisfaction or discharge of all other Obligations.

       

      §
        5.12  Increased Costs.

       

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

       

      (i)           impose,
        modify or deem applicable any reserve, special deposit, compulsory loan,
        insurance charge or similar requirement against assets of, deposits with
        or for
        the account of, or credit extended or participated in by, any Lender or the
        Issuing Bank;

       

      (ii)           subject
        any Lender or the Issuing Bank to any tax of any kind whatsoever with respect
        to
        this Agreement, any Letter of Credit (including for greater certainty under
        the
        Canadian Credit Facility), any participation in a Letter of Credit or any
        Eurodollar Rate Loan, Libor Loan, BA or CDOR Rate Loan made by it, or change
        the
        basis of taxation of payments to such Lender or the Issuing Bank in respect
        thereof (except for Indemnified Taxes or Other Taxes covered by § 5.13 and
        the imposition of, or any change in the rate of, any Excluded Tax payable
        by
        such Lender or the Issuing Bank); or

       

      (iii)           impose
        on any Lender or the Issuing Bank or the London interbank market any other
        condition, cost or expense affecting this Agreement or Eurodollar Rate Loans,
        Libor Loans, BAs or CDOR Rate Loans made by such Lender or any Letter of
        Credit
        (including for greater certainty under the Canadian Credit Facility) or
        participation therein;

       

      and
        the
        result of any of the foregoing shall be to increase the cost to such Lender
        of
        making or maintaining any Eurodollar Rate Loan, Libor Loan, BA or CDOR Rate
        Loan
        (or of maintaining its obligation to make any such Loan), or to increase
        the
        cost to such Lender or the Issuing Bank of participating in, issuing or
        maintaining any Letter of Credit (including for greater certainty under the
        Canadian Credit Facility) (or of maintaining its obligation to participate
        in or
        to issue any Letter of Credit), or to reduce the amount of any sum received
        or
        receivable by such Lender or the Issuing Bank hereunder (whether of principal,
        interest or any other amount) then, upon request of such Lender or the Issuing
        Bank, the applicable Borrowers will pay to such Lender or the Issuing Bank,
        as
        the case may be, such additional amount or amounts as will compensate such
        Lender or the Issuing Bank, as the case may be, for such additional costs
        incurred or reduction suffered.

       

      (b)           Capital
        Requirements.  If any Lender or the Issuing Bank determines that
        any Change in Law affecting such Lender or the Issuing Bank or any lending
        office of such Lender or such Lender’s or the Issuing Bank’s holding company, if
        any, regarding capital requirements has or would have the effect of reducing
        the
        rate of return on such Lender’s or the Issuing Bank’s capital or on the capital
        of such Lender’s or the Issuing Bank’s holding company, if any, as a consequence
        of this Agreement, the Commitments of such Lender or the Loans made by, or
        participations in Letters of Credit (including for greater certainty under
        the
        Canadian Credit Facility) held by, such Lender, or the Letters of Credit
        issued
        by the Issuing Bank or the Canadian Lender under the Canadian Credit Facility,
        to a level below that which such Lender or the Issuing Bank or such Lender’s or
        the Issuing Bank’s holding company could have achieved but for such Change in
        Law (taking into consideration such Lender’s or the Issuing Bank’s policies and
        the policies of such Lender’s or the Issuing Bank’s holding company with respect
        to capital adequacy), then from time to time the Borrowers will pay to such
        Lender or the Issuing Bank, as the case may be, such additional amount or
        amounts as will compensate such Lender or the Issuing Bank or such Lender’s or
        the Issuing Bank’s holding company for any such reduction suffered.

       

      
        
          
          

        

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

       

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

       

      (e)           Survival.  The
        agreements in this §5.12 shall survive the termination of the Commitments and
        repayment, satisfaction or discharge of all other Obligations.

       

      §
        5.13  Taxes.

       

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

       

      (b)           Payment
        of Other Taxes by the Borrower.  Without limiting the provisions
        of paragraph (a) above, the Borrower shall timely pay any Other Taxes to
        the
        relevant Governmental Authority in accordance with applicable law.

       

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

       

      (d)           Evidence
        of Payments.  As soon as practicable after any payment of
        Indemnified Taxes or Other Taxes by any Borrowers to a Governmental Authority,
        such Borrowers shall deliver to the Administrative Agent the original or
        a
        certified copy of a receipt issued by such Governmental Authority

       

      
        
          
          

        

        
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      evidencing
        such payment, a copy of the return reporting such payment or other evidence
        of
        such payment reasonably satisfactory to the Administrative Agent.

       

      (e)           Status
        of Lenders.  Any Foreign Lender that is entitled to an exemption
        from or reduction of withholding tax under the law of the jurisdiction in
        which
        any Borrower is resident for tax purposes, or any treaty to which such
        jurisdiction is a party, with respect to payments hereunder or under any
        other
        Loan Document shall deliver to such Borrower (with a copy to the Administrative
        Agent), at the time or times prescribed by applicable law or reasonably
        requested by such Borrower or the Administrative Agent, such properly completed
        and executed documentation prescribed by applicable law as will permit such
        payments to be made without withholding or at a reduced rate of
        withholding.  In addition, any Lender, if requested by such Borrower
        or the Administrative Agent, shall deliver such other documentation prescribed
        by applicable law or reasonably requested by such Borrower or the Administrative
        Agent as will enable such Borrower or the Administrative Agent to determine
        whether or not such Lender is subject to backup withholding or information
        reporting requirements.

       

      (f)           Without
        limiting the generality of the foregoing, in the event that any of the Borrowers
        is resident for tax purposes in the United States of America, any Foreign
        Lender
        shall deliver to such Borrowers and the Administrative Agent (in such number
        of
        copies as shall be requested by the recipient) on or prior to the date on
        which
        such Foreign Lender becomes a Lender under this Agreement (and from time
        to time
        thereafter upon the request of such Borrowers or the Administrative Agent,
        but
        only if such Foreign Lender is legally entitled to do so), whichever of the
        following is applicable:

       

      (i)           duly
        completed copies of Internal Revenue Service Form W-8BEN claiming eligibility
        for benefits of an income tax treaty to which the United States of America
        is a
        party,

       

      (ii)           duly
        completed copies of Internal Revenue Service Form W-8ECI,

       

      (iii)           in
        the case of a Foreign Lender claiming the benefits of the exemption for
        portfolio interest under section 881(c) of the Code, (x) a certificate to
        the
        effect that such Foreign Lender is not (A) a “bank” within the meaning of
        section 881(c)(3)(A) of the Code, (B) a “10 percent shareholder” of the Borrower
        within the meaning of section 881(c)(3)(B) of the Code, or (C) a “controlled
        foreign corporation” described in section 881(c)(3)(C) of the Code and (y) duly
        completed copies of  Internal Revenue Service Form W-8BEN,
        or

       

      (iv)           any
        other form prescribed by applicable law as a basis for claiming exemption
        from
        or a reduction in United States Federal withholding tax duly completed together
        with such supplementary documentation as may be prescribed by applicable
        law to
        permit the Borrower to determine the withholding or deduction required to
        be
        made.

       

      (g)           Treatment
        of Certain Refunds.  If the Administrative Agent, a Lender or the
        Issuing Bank determines, in its sole discretion, that it has received a refund
        of any Taxes or Other Taxes as to which it has been indemnified by any of
        the
        Borrowers or with respect to which any such Borrower has paid additional
        amounts
        pursuant to this Section, it shall pay to any such Borrower an amount equal
        to
        such refund (but only to the extent of indemnity payments made, or additional
        amounts paid, by any such Borrower under this Section with respect to the
        Taxes
        or Other Taxes giving rise to such refund), net of all out-of-pocket expenses
        of
        the Administrative Agent, such Lender or the Issuing Bank, as the case may
        be,
        and without interest (other than any interest paid by the relevant Governmental
        Authority with respect to such refund), provided that any such Borrower,
        upon the request of the Administrative Agent, such Lender or the Issuing
        Bank,
        agrees to repay the amount paid over to such Borrower (plus any penalties,
        interest or other charges imposed by the relevant Governmental Authority)
        to the
        Administrative Agent, such Lender or the Issuing Bank in the event the
        Administrative Agent, such Lender or the Issuing Bank

       

      
        
          
          

        

        
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      is
        required to repay such refund to such Governmental Authority.  This
        paragraph shall not be construed to require the Administrative Agent, any
        Lender
        or the Issuing Bank to make available its tax returns (or any other information
        relating to its taxes that it deems confidential) to the Borrower or any
        other
        Person.

       

      (h)           Survival.  The
        agreements in this §5.13 shall survive the termination of the Commitments and
        repayment, satisfaction or discharge of all other Obligations.

       

      §
        5.14  Mitigation Obligations; Replacement of Lenders.

       

      (a)           Designation
        of a Different Lending Office.  If any Lender requests
        compensation under § 5.12, or requires any of the Borrowers to pay any
        additional amount to any Lender or any Governmental Authority for the account
        of
        any Lender pursuant to § 5.13, then such Lender shall use reasonable
        efforts to designate a different lending office for funding or booking its
        Loans
        hereunder or to assign its rights and obligations hereunder to another of
        its
        offices, branches or affiliates, if, in the judgment of such Lender, such
        designation or assignment (i) would eliminate or reduce amounts payable
        pursuant to §§ 5.12 or 5.13, as the case may be, in the future and
        (ii) would not subject such Lender to any unreimbursed cost or expense and
        would not otherwise be disadvantageous to such Lender.  The Borrowers
        hereby agree to pay all reasonable costs and expenses incurred by any Lender
        in
        connection with any such designation or assignment.

       

      (b)           Replacement
        of Lenders.  If any Lender requests compensation under
§ 5.12, or if any Borrower is required to pay any additional amount to
        any
        Lender or any Governmental Authority for the account of any Lender pursuant
        to
§ 5.13, or if any Lender defaults in its obligation to fund Loans
        hereunder, then the Borrowers may, at their sole expense and effort, upon
        notice
        to such Lender and the Administrative Agent, require such Lender to assign
        and
        delegate, without recourse (in accordance with and subject to the restrictions
        contained in, and consents required by, § 14.6), all of its interests,
        rights and obligations under this Agreement and the related Loan Documents
        to an
        assignee that shall assume such obligations (which assignee may be another
        Lender, if a Lender accepts such assignment), provided that:

       

      (i)           the
        Borrowers shall have paid to the Administrative Agent the fee specified in
        § 14.6(b)(iv);

       

      (ii)           such
        Lender shall have received payment of an amount equal to the outstanding
        principal of its Loans, Swing Line Advances and participations in
        LC Advances, accrued interest thereon, accrued fees and all other amounts
        payable to it hereunder and under the other Loan Documents (including any
        amounts under § 5.9) from the assignee (to the extent of such outstanding
        principal and accrued interest and fees) or the Borrowers (in the case of
        all
        other amounts);

       

      (iii)           in
        the case of any such assignment resulting from a claim for compensation under
        § 5.12 or payments required to be made pursuant to § 5.13, such
        assignment will result in a reduction in such compensation or payments
        thereafter; and

       

      (iv)           such
        assignment does not conflict with applicable law.

       

      A
        Lender
        shall not be required to make any such assignment or delegation if, prior
        thereto, as a result of a waiver by such Lender or otherwise, the circumstances
        entitling the Borrowers to require such assignment and delegation cease to
        apply.

       

      
        
          
          

        

        
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      §
        6.  CONDITIONS PRECEDENT TO CREDIT EXTENSIONS.

       

      The
        obligation of each Lender to advance, continue or convert any Loan (other
        than
        the continuation of, or conversion into, a Base Rate Loan or Canadian Base
        Rate
        Loan, as applicable) or of the Issuing Bank to issue, extend the expiration
        date
        (including by not giving notice of non-renewal) of or increase the amount
        of any
        Letter of Credit under this Agreement, shall be subject to the following
        conditions precedent:

       

      §
        6.1  Conditions to All Credit Extensions.  

       

      (a)           each
        of the representations and warranties set forth herein and in the other Loan
        Documents shall be and remain true and correct as of said time, except to
        the
        extent the same expressly relate to an earlier date;

       

      (b)           no
        Default or Event of Default shall have occurred and be continuing or would
        occur
        as a result of such Credit Extension;

       

      (c)           in
        the case of a Borrowing, the Administrative Agent or the Canadian Lender,
        as
        applicable, shall have received the notice required by § 2.1.4 or
§ 2.2.4 hereof, as applicable, in the case of the issuance of any Letter of
        Credit the Issuing Bank shall have received a duly completed Letter of Credit
        Application for such Letter of Credit together with any fees called for by
        § 2.2.8 hereof, and, in the case of an extension or increase in the amount
        of a Letter of Credit, a written request therefor in a form acceptable to
        the
        Issuing Bank together with fees called for by § 2.2.8 hereof;
        and

       

      (d)           such
        Credit Extension shall not violate any order, judgment or decree of any court
        or
        other authority or any provision of law or regulation applicable to the
        Administrative Agent, the Issuing Bank, or any Lender (including, without
        limitation, Regulation U of the Board of Governors of the Federal Reserve
        System) as then in effect.

       

      Each
        request for a Credit Extension shall be deemed to be a representation and
        warranty by the relevant Borrower on the date on such Credit Extension as
        to the
        facts specified in subsections (a) through (c), both inclusive, of this
        Section.

       

      §
        6.2  Conditions to Initial Credit Extension. 

       

      Before
        or
        concurrently with the initial Credit Extension:

       

      (a)           the
        Administrative Agent shall have received for each Lender this Agreement duly
        executed by the Borrowers, any applicable Loan Party and the
        Lenders;

       

      (b)           the
        Administrative Agent shall have received for each Lender such Lender’s duly
        executed Revolving Notes of the U.S. Borrowers and Foreign Borrowers, and
        the
        duly executed Term Notes by the Term Loan Borrower and otherwise in compliance
        with the provisions of, as applicable, Sections 2.1.3, 2.2.3 and 4.2
        hereof;

       

      (c)           the
        Administrative Agent shall have received for each Lender certified copies
        of the
        charter, articles of incorporation and bylaws (or comparable organizational
        documents for the applicable jurisdiction) of the Loan Parties and any
        amendments thereto, certified in each instance by its Secretary, Assistant
        Secretary or other duly authorized officer of such Loan Party;

       

      
        
          
          

        

        
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      (d)           the
        Administrative Agent shall have received for each Lender copies of resolutions
        of the Board of Directors of the Loan Parties (or similar governing body)
        authorizing the execution, delivery and performance of this Agreement and
        the
        other Loan Documents to which it is a party and the consummation of the
        transactions contemplated hereby and thereby, together with specimen signatures
        of the persons authorized to execute such documents on its behalf, all certified
        in each instance by its Secretary, Assistant Secretary or other duly authorized
        officer of such Loan Party;

       

      (e)           the
        Administrative Agent shall have received for each Lender copies of the
        certificates of good standing for each of the Loan Parties (or the substantive
        equivalent certificates for Loan Parties outside of the United States) from
        the
        office of the secretary of the state of its incorporation or organization
        and of
        each state or jurisdiction in which it is qualified to do business as a foreign
        corporation or organization;

       

      (f)           (i)
        the Administrative Agent shall have received upfront fee set forth in
§ 5.4(a) and the reasonable fees and expenses of the Administrative Agent’s
        counsel, and (ii) the Canadian Lender shall have received the upfront fee
        set
        forth  in § 3.5(j);

       

      (g)           the
        Administrative Agent shall have received for the benefit of each Lender the
        favorable written opinion of counsel to each Borrower, in form and substance
        satisfactory to the Administrative Agent;

       

      (h)           the
        Administrative Agent shall have received financing statement and tax lien
        search
        results against the Property of the U.S. Borrowers, and PPSA searches for
        the
        Canadian Borrowers evidencing the absence of Liens on such Property except
        as
        permitted by Section 9.2 hereof;

       

      (i)           the
        Administrative Agent shall have received satisfactory evidence of payoff
        of the
        Existing Credit Facilities and release of any Borrowers’ obligations of any kind
        thereunder;

       

      (j)           the
        Administrative Agent shall have received for the account of the Lenders such
        other agreements, instruments, documents, certificates, and opinions as the
        Administrative Agent may reasonably request.

       

      §
        7.  REPRESENTATIONS AND WARRANTIES

       

      Each
        of
        the Borrowers represents and warrants to the Administrative Agent and the
        Lenders as follows:

       

      §
        7.1  Organization and Qualification. 

       

      (a)           Each
        of the U.S. Borrowers and each of the U.S. Guarantors is duly organized,
        validly
        existing, and in good standing under the laws of the United States jurisdiction
        in which it is organized, has full and adequate power to own its Property
        and
        conduct its business as now conducted, and is duly licensed or qualified
        and in
        good standing in each jurisdiction in which the nature of the business conducted
        by it or the nature of the Property owned or leased by it requires such
        licensing or qualifying, except where the failure to do so would not have
        a
        Material Adverse Effect.

       

      (b)           Each
        of the Canadian Borrowers and each of the Canadian Guarantors is duly organized,
        validly existing, and in good standing as a corporation under the laws of
        Canada, has full and adequate power to own its Property and conduct its business
        as now conducted, and is duly licensed or qualified and in good standing
        in each
        jurisdiction in which the nature of the business conducted by it or the
        nature

       

      
        
          
          

        

        
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      of
        the
        Property owned or leased by it requires such licensing or qualifying, except
        where the failure to do so would not have a Material Adverse
        Effect.

       

      (c)           Each
        Foreign Borrower is duly organized, validly existing, and in good standing
        under
        the laws of the jurisdiction in which it is organized, has full and adequate
        power to own its Property and conduct its business as now conducted, and
        is duly
        licensed or qualified and in good standing in each jurisdiction in which
        the
        nature of the business conducted by it or the nature of the Property owned
        or
        leased by it requires such licensing or qualifying, except where the failure
        to
        do so would not have a Material Adverse Effect.

       

      §
        7.2  Subsidiaries.  

       

      Schedule
        7.2 hereto (as the same may be deemed amended from time to time pursuant
        to
§ 8.9 hereof) identifies each Subsidiary, the jurisdiction of its
        organization, the percentage of issued and outstanding shares of each class
        of
        its capital stock or other equity interests owned by LoJack and the other
        Subsidiaries and, if such percentage is not 100% (excluding directors'
        qualifying shares as required by law), a description of each class of its
        authorized capital stock and other equity interests and the number of shares
        of
        each class issued and outstanding. All of the outstanding shares of capital
        stock and other equity interests of each Subsidiary are validly issued and
        outstanding and fully paid and nonassessable and all such shares and other
        equity interests indicated on Schedule 7.2 (as so amended) as owned by
        LoJack or another Subsidiary are owned, beneficially and of record, by LoJack
        or
        such Subsidiary free and clear of all Liens. There are no outstanding
        commitments or other obligations of any Subsidiary to issue, and no options,
        warrants or other rights of any Person to acquire, any shares of any class
        of
        capital stock or other equity interests of any Subsidiary.

       

      §
        7.3  Authority and Validity of Obligations. 

       

      Each
        of
        the Borrowers and each of the Guarantors has full right and authority to
        enter
        into this Agreement and the other Loan Documents executed by it, to make
        the
        borrowings herein provided for, to issue its applicable Notes in evidence
        thereof, and to perform all of its obligations hereunder and under the other
        Loan Documents executed by it.  The Loan Documents delivered by the
        Borrowers and the Guarantors have been duly authorized, executed, and delivered
        by such Persons and constitute valid and binding obligations of each of the
        Borrowers and each of the Guarantors, enforceable against them in accordance
        with their terms, except as enforceability may be limited by bankruptcy,
        insolvency, fraudulent conveyance or similar laws affecting creditors' rights
        generally and general principles of equity (regardless of whether the
        application of such principles is considered in a proceeding in equity or
        at
        law); and this Agreement and the other Loan Documents do not, nor does the
        performance or observance by any of the Borrowers or any of the Guarantors
        of
        any of the matters and things herein or therein provided for, (a) contravene
        or
        constitute a default under any provision of law or any judgment, injunction,
        order or decree binding upon any of the Borrowers or any of the Guarantors
        or
        any provision of the organizational documents (e.g., charter, certificate
        or
        articles of incorporation and by-laws, certificate or articles of association
        and operating agreement, partnership agreement, or other similar organizational
        documents) of any Borrower or Guarantor, (b) contravene or constitute a default
        under any covenant, indenture or agreement of or affecting any Borrower or
        Guarantor or any of their Property, in each case where such contravention
        or
        default, individually or in the aggregate, could reasonably be expected to
        have
        a Material Adverse Effect, or (c) result in the creation or imposition of
        any
        Lien on any Property of any Borrower or Guarantor.

       

      §
        7.4  Use of Proceeds; Margin Stock. 

       

      
        
          
          

        

        
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      The
        proceeds of (a) the Revolving Credit Loans and Canadian Revolving Credit
        Loans
        shall be used for working capital purposes, general corporate purposes, the
        repurchase of LoJack common stock, Permitted Acquisitions and Permitted
        Investments and (b) the proceeds of the Term Loan shall be used to refinance
        the
        outstanding obligations under the Existing Credit Facilities.  None of
        the Borrowers is engaged in the business of extending credit for the purpose
        of
        purchasing or carrying margin stock (within the meaning of Regulation U of
        the
        Board of Governors of the Federal Reserve System), and no part of the proceeds
        of any Loan or any other extension of credit made hereunder 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.  Margin stock
        (as hereinabove defined) constitutes less than 25% of the assets of the
        Borrowers which are subject to any limitation on sale, pledge or other
        restriction hereunder.

       

      §
        7.5  Financial Reports. 

       

      (a)           The
        consolidated balance sheet of LoJack and its Subsidiaries as at December
        31,
        2006, and the related consolidated statements of income, retained earnings
        and
        cash flows of LoJack and its Subsidiaries for the fiscal year then ended,
        and
        accompanying notes thereto, which financial statements are accompanied by
        the
        audit report of Deloitte & Touche LLP, independent public accountants, and
        the unaudited interim consolidated balance sheet of LoJack and its Subsidiaries
        as at March 31, 2007, and the related consolidated statements of income,
        retained earnings and cash flows of LoJack and its Subsidiaries for the 3
        months
        then ended, heretofore furnished to the Administrative Agent and the Lenders,
        fairly present (subject, in the case of the March 31, 2007 financial statements,
        to year-end audit adjustments) the consolidated financial condition of the
        Borrowers and their Subsidiaries as at said dates and the consolidated results
        of their operations and cash flows for the periods then ended in conformity
        with
        GAAP applied on a consistent basis.

       

      (b)           Neither
        LoJack nor any of its Subsidiaries has contingent liabilities which are material
        to it other than as indicated on such financial statements or, with respect
        to
        future periods, on the financial statements furnished pursuant to §  8.5
        hereof or as otherwise disclosed in writing by LoJack to the Administrative
        Agent and the Lenders.

       

      §
        7.6  No Material Adverse Change. 

       

      Since
        the
        date of the last audited financial statements on December 31, 2006, there
        has
        been no change in the condition (financial or otherwise) or business prospects
        of LoJack and its Subsidiaries, taken as a whole, that has or could reasonably
        be expected to have a Materially Adverse Effect.

       

      §
        7.7  Full Disclosure. 

       

      The
        statements and information furnished to the Administrative Agent and the
        Lenders
        in connection with the negotiation of this Agreement and the other Loan
        Documents and the commitments by the Lenders to provide all or part of the
        financing contemplated hereby, taken as a whole, do not contain any untrue
        statements of a material fact or omit a material fact necessary to make the
        material statements contained herein or therein not misleading, the
        Administrative Agent and the Lenders acknowledging that as to any projections
        furnished to the Administrative Agent and the Lenders, LoJack only represents
        that the same were prepared on the basis of information and estimates LoJack
        believed to be reasonable on the date hereof.

       

      §
        7.8  Trademarks, Franchises, and Licenses. 

       

      Each
        of
        LoJack and its Subsidiaries own, possess, or have the right to use all necessary
        patents, licenses, franchises, trademarks, trade names, trade styles,
        copyrights, trade secrets, know how, and

       

      
        
          
          

        

        
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      confidential
        commercial and proprietary information to conduct their businesses as now
        conducted, without known conflict with any patent, license, franchise,
        trademark, trade name, trade style, copyright or other proprietary right
        of any
        other Person that could reasonably be expected to have a Material Adverse
        Effect.

       

      §
        7.9  Governmental Authority and Licensing. 

       

      LoJack
        and its Subsidiaries have received all licenses, permits, and approvals of
        all
        federal, state, provincial, and local governmental authorities, if any,
        necessary to conduct their businesses, in each case where the failure to
        obtain
        or maintain the same could reasonably be expected to have a Material Adverse
        Effect. No investigation or proceeding which, if adversely determined, could
        reasonably be expected to result in revocation or
        denial of
        any material license, permit or approval is pending or, to the knowledge
        of
        LoJack, threatened.

       

      §
        7.10  Good Title. 

       

      LoJack
        and its Subsidiaries have good and defensible title (or valid leasehold
        interests) to their assets as reflected on the most recent consolidated balance
        sheet of LoJack and its Subsidiaries furnished to the Administrative Agent
        and
        the Lenders (except for sales of assets in the ordinary course of business
        and
        as otherwise permitted under Section 8.10 hereof), subject to no Liens other
        than such thereof as are permitted by Section 8.8 hereof.

       

      §
        7.11  Litigation and Other Controversies. 

       

      Except
        as
        disclosed in LoJack’s letter to the Administrative Agent and the Lenders dated
        as of the date hereof, there is no litigation or governmental or arbitration
        proceeding or labor controversy pending, nor to the knowledge of LoJack
        threatened, against LoJack or any of its Subsidiaries or any of their Property
        which, individually or in the aggregate, could reasonably be expected to
        have a
        Material Adverse Effect.

       

      §
        7.12  Taxes. 

       

      All
        material tax returns required to be filed by LoJack and its Subsidiaries
        in any
        jurisdiction have, in fact, been filed, and all taxes, assessments, fees,
        and
        other governmental charges upon such Persons or upon any of their Property,
        income or franchises, which are shown to be due and payable in such returns,
        have been paid, except such taxes, assessments, fees and governmental charges,
        if any, as are being contested in good faith and by appropriate proceedings
        which prevent enforcement of the matter under contest and as to which adequate
        reserves established in accordance with GAAP have been
        provided.  Neither LoJack nor any of its Subsidiaries knows of any
        proposed additional tax assessment that is material against it or its
        Subsidiaries for which adequate provisions in accordance with GAAP have not
        been
        made on their accounts.  Adequate provisions in accordance with GAAP
        for taxes on the books of LoJack and its Subsidiaries have been made for
        all
        open years, and for its current fiscal period.

       

      §
        7.13  Approvals. 

       

      No
        authorization, consent, license or exemption from, or filing or registration
        with, any court or governmental department, agency or instrumentality, nor
        any
        approval or consent of any other Person, is or will be necessary to the valid
        execution, delivery or performance by any of the Borrowers or any of the
        Guarantors of any Loan Document, except for such approvals which have been
        obtained prior to the date of this Agreement and remain in full force and
        effect.

       

      
        
          
          

        

        
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      §
        7.14  Affiliate Transactions. 

       

      Neither
        LoJack nor any of its Subsidiaries is a party to any contracts or agreements
        with any of its Affiliates on terms and conditions which are materially less
        favorable to such Person than would be usual and customary in similar contracts
        or agreements between Persons not affiliated with each other.

       

      §
        7.15  Investment Company; Public Utility Holding Company.

       

      Neither
        LoJack nor any of its Subsidiaries is an “investment company” or a company
“controlled” by an “investment company” within the meaning of the Investment
        Company Act of 1940, as amended, or a “public utility holding company” within
        the meaning of the Public Utility Holding Company Act of 1935, as amended.

       

      §
        7.16  ERISA. 

       

      LoJack
        and each member of the controlled group of corporations and all trades or
        businesses (whether incorporated or not) under common control which, together
        with LoJack, are treated as a single employer under Section 414 of the Internal
        Revenue Code of 1986 (as amended), and any successor statute thereto (the
        “Controlled Group”) has fulfilled its obligations under the minimum funding
        standards of and is in compliance in all material respects with ERISA and
        the
        Code to the extent applicable to it and has not incurred any liability to
        the
        PBGC or a Plan under Title IV of ERISA other than a liability to the PBGC
        for
        premiums under Section 4007 of ERISA.  None of the Borrowers or the
        Guarantors has any contingent liabilities with respect to any post-retirement
        benefits under a Welfare Plan, other than liability for continuation coverage
        described in article 6 of Title I of ERISA.

       

      §
        7.17  Compliance with Laws. 

       

      Each
        of
        LoJack and its Subsidiaries are in compliance with the requirements of all
        federal, state, provincial, and local laws, rules and regulations applicable
        to
        or pertaining to their Property or business operations (including, without
        limitation, the Occupational Safety and Health Act of 1970, the Americans
        with
        Disabilities Act of 1990, and laws and regulations establishing quality criteria
        and standards for air, water, land and toxic or hazardous wastes and
        substances), where any such non-compliance, individually or in the aggregate,
        could reasonably be expected to have a Material Adverse
        Effect.  Neither LoJack nor any of its Subsidiaries has received
        notice to the effect that its operations are not in compliance with any of
        the
        requirements of applicable federal, state, provincial, or local environmental,
        health, and safety statutes and regulations or is the subject of any
        governmental investigation evaluating whether any remedial action is needed
        to
        respond to a release of any toxic or hazardous waste or substance into the
        environment, where any such non-compliance or remedial action, individually
        or
        in the aggregate, could reasonably be expected to have a Material Adverse
        Effect.

       

      §
        7.18  Other Agreements. 

       

      Neither
        LoJack nor any of its Subsidiaries is in default under the terms of any
        covenant, indenture or agreement of or affecting such Person or any of its
        Property, which default if uncured could reasonably be expected to have a
        Material Adverse Effect.

       

      §
        7.19  No Default. 

       

      No
        Default or Event of Default has occurred and is continuing.

       

      
        
          
          

        

        
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      §
        8.  AFFIRMATIVE COVENANTS.

       

      Each
        of
        the Borrowers agrees that, so long as any credit is available to or in use
        by
        any of the Borrowers hereunder, except to the extent compliance in any case
        or
        cases is waived in writing pursuant to the terms of Section 14.11
        hereof:

       

      §
        8.1  Maintenance of Business. 

       

      Each
        of
        the Borrowers shall, and shall cause each Subsidiary to, preserve and maintain
        its existence, except as otherwise provided in Section 9.4 hereof. Each of
        the
        Borrowers shall, and shall cause each Subsidiary to, preserve and keep in
        force
        and effect all licenses, permits, franchises, approvals, patents, trademarks,
        trade names, trade styles, copyrights, and other proprietary rights necessary
        to
        the proper conduct of its business where the failure to do so could reasonably
        be expected to have a Material Adverse Effect.

       

      §
        8.2  Maintenance of Properties. 

       

      Each
        of
        the Borrowers shall, and shall cause each Subsidiary to, maintain, preserve,
        and
        keep its property, plant, and equipment in good repair, working order and
        condition (ordinary wear and tear excepted), and shall from time to time
        make
        all needful and proper repairs, renewals, replacements, additions, and
        betterments thereto so that at all times the efficiency thereof shall be
        fully
        preserved and maintained, except to the extent that, in the reasonable business
        judgment of such Person, any such Property is no longer necessary for the
        proper
        conduct of the business of such Person.

       

      §
        8.3  Taxes and Assessments. 

       

      Each
        of
        the Borrowers shall duly pay and discharge, and shall cause each Subsidiary
        to
        duly pay and discharge, all material taxes, rates, assessments, fees, and
        governmental charges upon or against it or its Property, in each case before
        the
        same become delinquent and before penalties accrue thereon, unless and to
        the
        extent that the same are being contested in good faith and by appropriate
        proceedings which prevent enforcement of the matter under contest and adequate
        reserves are provided therefor.

       

      §
        8.4  Insurance. 

       

      Each
        of
        the Borrowers shall insure and keep insured, and shall cause each Subsidiary
        to
        insure and keep insured, with good and responsible insurance companies, all
        insurable Property owned by it which is of a character usually insured by
        Persons similarly situated and operating like Properties against loss or
        damage
        from such hazards and risks, and in such amounts, as are insured by Persons
        similarly situated and operating like Properties; and each of the Borrowers
        shall insure, and shall cause each Subsidiary to insure, such other hazards
        and
        risks (including, without limitation, employers' and public liability risks)
        with good and responsible insurance companies as and to the extent usually
        insured by Persons similarly situated and conducting similar businesses.
        Each of
        the Borrowers shall, upon the request of the Administrative Agent, furnish
        to
        the Administrative Agent and the Lenders a certificate setting forth in summary
        form the nature and extent of the insurance maintained pursuant to this
        Section.

       

      §
        8.5  Financial Reports. 

       

      Each
        of
        the Borrowers shall, and shall cause each Subsidiary to, maintain a standard
        system of accounting in accordance with GAAP and shall furnish to the
        Administrative Agent, each Lender and each of their duly authorized
        representatives such information respecting the business and
        financial

       

      
        
          
          

        

        
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      condition
        of each of the Borrowers and each Subsidiary as the Administrative Agent
        or such
        Lender may reasonably request; and without any request, shall furnish to
        the
        Administrative Agent and the Lenders:

       

      (a)           as
        soon as available, and in any event within 45 days after the last day of
        each of
        the first three fiscal quarters of each fiscal year of LoJack, a copy of
        the
        consolidated balance sheet of the LoJack and its Subsidiaries as of the last
        day
        of such fiscal quarter and the consolidated statements of income, retained
        earnings, and cash flows of the LoJack and its Subsidiaries for the fiscal
        quarter and for the fiscal year-to-date period then ended, each in reasonable
        detail showing in comparative form the figures for the corresponding date
        and
        period in the previous fiscal year, prepared by LoJack in accordance with
        GAAP
        (subject to the absence of footnote disclosures and year-end audit adjustments)
        and certified to by its chief financial officer or another officer of LoJack
        acceptable to the Administrative Agent;

       

      (b)           as
        soon as available, and in any event within 90 days after the last day of
        each
        fiscal year of LoJack, a copy of the consolidated balance sheet of LoJack
        and
        its Subsidiaries as of the last day of the fiscal year then ended and the
        consolidated statements of income, retained earnings, and cash flows of LoJack
        and its Subsidiaries for the fiscal year then ended, and accompanying notes
        thereto, each in reasonable detail showing in comparative form the figures
        for
        the previous fiscal year, accompanied in the case of the consolidated financial
        statements by an unqualified opinion of Deloitte & Touche LLP or another
        firm of independent public accountants of recognized national standing, selected
        by LoJack (and reasonably satisfactory to the Administrative Agent and the
        Required Lenders acting in good faith and in a commercially reasonable manner),
        to the effect that the consolidated financial statements have been prepared
        in
        accordance with GAAP and present fairly in accordance with GAAP the consolidated
        financial condition of LoJack and its Subsidiaries as of the close of such
        fiscal year and the results of their operations and cash flows for the fiscal
        year then ended and that an examination of such accounts in connection with
        such
        financial statements has been made in accordance with generally accepted
        auditing standards and, accordingly, such examination included such tests
        of the
        accounting records and such other auditing procedures as were considered
        necessary in the circumstances;

       

      (c)           notice
        of any Change of Control;

       

      (d)           promptly
        after knowledge thereof shall have come to the attention of any responsible
        officer of LoJack, written notice of (i) any threatened or pending litigation
        or
        governmental or arbitration proceeding or labor controversy against any of
        the
        Borrowers or any of their Property which could reasonably be expected to
        have a
        Material Adverse Effect or (ii) the occurrence of any Default or Event of
        Default hereunder;

       

      (e)           with
        each of the financial statements furnished to the Lenders pursuant to
        subsections (a) and (b) above, a written certificate in the form attached
        hereto
        as Exhibit E (a “Compliance Certificate”) signed by the chief
        financial officer of LoJack or another officer of LoJack acceptable to the
        Administrative Agent to the effect that to the best of such officer's knowledge
        and belief no Default or Event of Default has occurred during the period
        covered
        by such statements or, if any such Event of Default has occurred during such
        period, setting forth a description of such Event of Default and specifying
        the
        action, if any, taken by LoJack or any Subsidiary to remedy the same;
        and

       

      (f)           with
        each of the financial statements furnished to the Lenders pursuant to
        subsections (a) and (b) above, copies of internally-prepared unconsolidated
        financial statements for LoJack and its Subsidiaries (in substantially the
        form
        furnished to the Lenders prior to the date hereof).

       

      §
        8.6  Inspection. 

       

      
        
          
          

        

        
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      Each
        of
        the Borrowers shall, and shall cause each Subsidiary to, permit the
        Administrative Agent, each Lender, and each of their duly authorized
        representatives and agents to visit and inspect any of its Property, corporate
        books, and financial records, to examine and make copies of its books of
        accounts and other financial records, and to discuss its affairs, finances,
        and
        accounts with, and to be advised as to the same by, its officers, employees
        and
        independent public accountants (and by this provision each of the Borrowers
        hereby authorizes such accountants to discuss with the Administrative Agent
        and
        such Lenders the finances and affairs of each of the Borrowers and its
        Subsidiaries) at such reasonable times and intervals as the Administrative
        Agent
        or any such Lender may designate and with reasonable prior notice to
        LoJack.

       

      §
        8.7  ERISA. 

       

      Each
        of
        the Borrowers shall, and shall cause each Subsidiary to, promptly pay and
        discharge all obligations and liabilities arising under ERISA of a character
        which if unpaid or unperformed could reasonably be expected to result in
        the
        imposition of a Lien against any of its Property. Each of the Borrowers shall,
        and shall cause each Subsidiary to, promptly notify the Administrative Agent
        and
        each Lender of: (a) the occurrence of any reportable event (as defined in
        ERISA)
        with respect to a Plan, (b) receipt of any notice from the PBGC of its intention
        to seek termination of any Plan or appointment of a trustee therefor, (c)
        its
        intention to terminate or withdraw from any Plan, and (d) the occurrence
        of any
        event with respect to any Plan which would result in the incurrence by LoJack
        or
        any Subsidiary of any material liability, fine or penalty, or any material
        increase in the contingent liability of LoJack or any Subsidiary with respect
        to
        any post-retirement Welfare Plan benefit.

       

      §
        8.8  Compliance with Laws. 

       

      Each
        of
        the Borrowers shall, and shall cause each Subsidiary to, comply in all respects
        with the requirements of all federal, state, provincial, and local laws,
        rules,
        regulations, ordinances and orders applicable to or pertaining to its Property
        or business operations, where any such non-compliance, individually or in
        the
        aggregate, could reasonably be expected to have a Material Adverse Effect
        or
        result in a Lien upon any of its Property.

       

      §
        8.9  Formation of Subsidiaries. 

       

      (a)           Promptly
        upon the formation or acquisition of any Subsidiary, LoJack shall provide
        the
        Administrative Agent and the Lenders notice thereof (at which time, Schedule
        1 and Schedule 7.2 shall be deemed amended to include reference to
        such Subsidiary) and timely comply with the requirements of § 11 hereof to
        the extent applicable.

       

      (b)           Any
        new U.S. Subsidiary or Canadian Subsidiary created or acquired by a Borrower
        as
        permitted under §9.4 shall become a U.S. Guarantor or Canadian Guarantor
        hereunder on or before the fifth (5th) Business Day after creation or
        acquisition of such Subsidiary by (i) signing a joinder agreement in
        substantially the form attached hereto as Exhibit G or entering into an
        amendment to this Credit Agreement and any other applicable Loan Documents,
        as
        applicable, with the other parties hereto and thereto, in form and substance
        satisfactory to the Administrative Agent, providing that such Subsidiary
        shall
        become a U.S. Guarantor or Canadian Guarantor hereunder, as the case may
        be,
        pursuant to § 11.1, and (ii) providing such other documentation as the
        Administrative Agent may reasonably request, including, without limitation,
        documentation with respect to the conditions specified in §6 hereof;
provided, however, that upon LoJack’s written request and subject
        to, as applicable, the Lenders’ or the Canadian Lender’s consent and compliance
        with the other requirements in this § 8.9(b), any such new U.S. Subsidiary
        or Canadian Subsidiary may become, as the case may be, a U.S. Borrower or
        Canadian Revolving Borrower hereunder.

       

      
        
          
          

        

        
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      §
        8.10  Use of Proceeds. 

       

      The
        Borrowers shall use the credit extended under this Agreement solely for the
        purposes set forth in, or otherwise permitted by, Section 7.4
        hereof.

       

      §
        8.11  Insolvency Applications. 

       

      The
        Canadian Borrowers, for themselves and each of its Subsidiaries (if any),
        acknowledge that their business and financial relationships with the Lenders
        are
        unique, and that the Lenders do not have a common interest with any other
        of
        their creditors. The Canadian Borrowers, for themselves and each of its
        Subsidiaries (if any), agrees that if any of them files any
        plan of arrangement under the Companies' Creditors Arrangement Act or makes
        any
        proposal under the Bankruptcy and Insolvency Act, the Lenders will be placed
        in
        their own class for voting and distribution purposes, and that none of them
        will
        permit, directly or indirectly, the Lenders to be classified with any other
        creditor for any purpose of such plan or proposal or otherwise.

       

      §
        9.  NEGATIVE COVENANTS.

       

      Each
        of
        the Borrowers agrees that, so long as the Commitments shall be in effect,
        or any
        Loan or Letter of Credit or other Obligation is outstanding:

       

      §
        9.1  Borrowings and Guaranties. 

       

      None
        of
        the Borrowers shall, nor shall it permit any Subsidiary to, issue, incur,
        assume, create or have outstanding any Indebtedness, or be or become liable
        as
        endorser, guarantor, surety or otherwise for any debt, obligation or undertaking
        of any other Person, or otherwise agree to provide funds for payment of the
        obligations of another, or supply funds thereto or invest therein or otherwise
        assure a creditor of another against loss, or apply for or become liable
        to the
        issuer of a letter of credit which supports an obligation of another, or
        subordinate any claim or demand it may have to the claim or demand of any
        other
        Person; provided, however, that the foregoing shall not restrict
        nor operate to prevent:

       

      (a)           the
        Obligations;

       

      (b)           purchase
        money indebtedness and Capitalized Lease Obligations of LoJack and its
        Subsidiaries in an amount not to exceed the Dollar Equivalent of $10,000,000
        in
        the aggregate at any one time outstanding;

       

      (c)           obligations
        arising out of non-speculative interest rate, foreign currency, and commodity
        hedging agreements entered into with financial institutions in the ordinary
        course of business;

       

      (d)           endorsement
        of items for deposit or collection of commercial paper received in the ordinary
        course of business;

       

      (e)           intercompany
        advances from time to time owing by any Guarantor to LoJack or another Guarantor
        or Borrower, or owing by LoJack or any Guarantor to any Borrower;

       

      (f)           intercompany
        advances from time to time owing by any Subsidiary (other than a Borrower
        or
        Guarantor) to LoJack or any Guarantor, to the extent permitted under Section
        9.3;

       

      (g)           indebtedness
        under unsecured lines of credit by commercial banks or other financing
        institutions in favor of any Foreign Subsidiary (which may be guaranteed
        by
        LoJack) provided that the

       

      
        
          
          

        

        
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      aggregate
        Dollar Equivalent of the aggregate unpaid principal amount of all such
        Indebtedness may not exceed the Dollar Equivalent of $3,500,000 in the aggregate
        at any time;

       

      (h)           indebtedness
        of LoJack and its Subsidiaries disclosed on Schedule 9.1 hereof;
        and

       

      (i)           subject
        to §§ 9.6 and 9.9, Seller Subordinated Debt.

       

      §
        9.2  Liens. 

       

      None
        of
        the Borrowers shall, nor shall it permit any Subsidiary to, create, incur
        or
        permit to exist any Lien of any kind on any Property owned by any such Person;
        provided, however, that the foregoing shall not apply to nor operate to
        prevent:

       

      (a)           Liens
        arising by statute in connection with worker's compensation, unemployment
        insurance, old age benefits, social security obligations, taxes, assessments,
        statutory obligations or other similar charges (other than Liens arising
        under
        ERISA), good faith cash deposits in connection with tenders, contracts or
        leases
        to which LoJack or any Subsidiary is a party or other cash deposits required
        to
        be made in the ordinary course of business, provided in each case that the
        obligation is not for borrowed money and that the obligation secured is not
        overdue or, if overdue, is being contested in good faith by appropriate
        proceedings which prevent enforcement of the matter under contest and adequate
        reserves have been established therefor or which do not exceed the Dollar
        Equivalent of $3,000,000 in the aggregate at any time outstanding;

       

      (b)           mechanics',
        workmen's, materialmen's, landlords', carriers' or other similar Liens arising
        in the ordinary course of business with respect to obligations which are
        not due
        or which are being contested in good faith by appropriate proceedings which
        prevent enforcement of the matter under contest or which do not exceed the
        Dollar Equivalent of $3,000,000 in the aggregate at any time
        outstanding;

       

      (c)           judgment
        liens and judicial attachment liens not constituting an Event of Default
        under
        Section 12.1(g) hereof and the pledge of assets for the purpose of securing
        an
        appeal, stay or discharge in the course of any legal proceeding, provided
        that
        the aggregate amount of such judgment liens and attachments and liabilities
        of
        LoJack and its Subsidiaries secured by a pledge of assets permitted under
        this
        subsection, including interest and penalties thereon, if any, shall not be
        in
        excess of the Dollar Equivalent of $3,000,000 at any one time
        outstanding;

       

      (d)           Liens
        on equipment of LoJack or any Subsidiary created solely for the purpose of
        securing indebtedness permitted by Section 9.1(b) hereof, representing or
        incurred to finance the purchase price of such Property, provided that no
        such
        Lien shall extend to or cover other Property of LoJack or such Subsidiary
        other
        than the respective Property so acquired, and the principal amount of
        indebtedness secured by any such Lien shall at no time exceed the purchase
        price
        of such Property, as reduced by repayments of principal thereon;

       

      (e)           any
        interest or title of a lessor under any operating lease;

       

      (f)           Liens,
        if any, described on Schedule 9.2 hereof; and

       

      (g)           easements,
        rights-of-way, restrictions, and other similar encumbrances against real
        property incurred in the ordinary course of business which, in the aggregate,
        are not substantial in amount and which do not materially detract from the
        value
        of the Property subject thereto or materially interfere with the ordinary
        conduct of the business of LoJack or any Subsidiary.

       

      
        
          
          

        

        
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      §
        9.3  Investments. 

       

      None
        of
        the Borrowers shall, nor shall it permit any Subsidiary to, directly or
        indirectly, make, retain or have outstanding any investments (whether through
        purchase of stock or obligations or otherwise) in, or loans or advances to
        (other than for travel advances and other similar cash advances made to
        employees in the ordinary course of business), any other Person, or acquire
        all
        or any substantial part of the assets or business of any other Person or
        division thereof; provided, however, that the foregoing shall not apply to
        nor
        operate to prevent:

       

      (a)           investments
        in direct obligations of the United States of America or of any agency or
        instrumentality thereof whose obligations constitute full faith and credit
        obligations of the United States of America, provided that any such obligations
        shall mature within 18-months of the date of acquisition thereof;

       

      (b)           investments
        in commercial paper rated at least P-1 by Moody's and at least A-1 by S&P
        maturing within 18-months of the date of acquisition thereof;

       

      (c)           investments
        in certificates of deposit issued by any Lender or by any United States
        commercial bank having capital and surplus reasonably acceptable to the
        Administrative Agent;

       

      (d)           investments
        in repurchase obligations with a term of not more than 7 days for underlying
        securities of the types described in subsection (a) above entered into with
        any
        bank meeting the qualifications specified in subsection (c) above, provided
        all
        such agreements require physical delivery of the securities securing such
        repurchase agreement, except those delivered through the Federal Reserve
        Book
        Entry System;

       

      (e)           investments
        in money market funds that invest solely, and which are restricted by their
        respective charters to invest solely, in investments of the type described
        in
        the immediately preceding subsections (a), (b), (c), and (d) above;

       

      (f)           investments
        existing on the date of this Agreement;

       

      (g)           investments
        from time to time in Guarantors hereunder;

       

      (h)           intercompany
        advances made from time to time by LoJack, a Borrower or a Guarantor to LoJack,
        another Borrower or a Guarantor or by any direct or indirect wholly-owned
        (except for directors qualifying shares) Subsidiary to LoJack or any
        Guarantor;

       

      (i)           investments
        in, and loans or advances to, any Subsidiary that is not a Borrower or Guarantor
        made after the date hereof in an aggregate amount not to exceed the Dollar
        Equivalent of $25,000,000 at any one time outstanding;

       

      (j)           other
        investments, loans, and advances in addition to those otherwise permitted
        by
        this Section made after the date hereof in an aggregate amount not to exceed
        the
        Dollar Equivalent of $10,000,000 at any one time outstanding; and

       

      (k)           any
        Permitted Acquisition.

       

      In
        determining the amount of investments, acquisitions, loans, and advances
        permitted under this §9.3, investments and acquisitions shall always be taken at
        the original cost thereof (regardless of any

       

      
        
          
          

        

        
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      subsequent
        appreciation or depreciation therein), less any cash return in respect of
        any
        investment, and loans and advances shall be taken at the principal amount
        thereof then remaining unpaid.

       

      §
        9.4  Mergers, Consolidations and Sales and Acquisitions.

       

      None
        of
        the Borrowers shall, nor shall it permit any Subsidiary to, be a party to
        any
        amalgamation, merger or consolidation, or sell, transfer, lease or otherwise
        dispose of all or any part of its Property, including any disposition of
        Property as part of a sale and leaseback transaction, or in any event sell
        or
        discount (with or without recourse) any of its notes or accounts receivable;
        provided, however, that this Section shall not apply to nor operate to
        prevent:

       

      (a)           the
        sale or lease of inventory in the ordinary course of business;

       

      (b)           the
        sale, transfer, lease or other disposition of Property of (i) LoJack and
        the
        Guarantors to one another and (ii) any Foreign Subsidiary to another Foreign
        Subsidiary;

       

      (c)           the
        merger or amalgamation of any Subsidiary with and into LoJack or any other
        Subsidiary, provided that, (i) in the case of any merger or amalgamation
        involving a Borrower, the Borrower is the surviving corporation, (ii) in
        the
        case of any merger or amalgamation involving a Guarantor, the Guarantor is
        the
        surviving corporation and (iii) in the case of any merger or amalgamation
        involving LoJack, LoJack is the surviving corporation;

       

      (d)           the
        sale of delinquent notes or accounts receivable in the ordinary course of
        business for purposes of collection only (and not for the purpose of any
        bulk
        sale or securitization transaction);

       

      (e)           the
        sale, transfer or other disposition of any tangible personal property that,
        in
        the reasonable business judgment of LoJack or its Subsidiary, has become
        obsolete or worn out, and which is disposed of in the ordinary course of
        business;

       

      (f)           the
        license of any intellectual property assets in the ordinary course of business,
        and the license or transfer of any rights to use intellectual property outside
        of the United States to any Borrower or any Subsidiary;

       

      (g)           any
        Permitted Acquisition, and any investment permitted under Section
        9.3;

       

      (h)           the
        sale, transfer, lease or other disposition of Property of LoJack or any
        Subsidiary (including any disposition of Property as part of a sale and
        leaseback transaction) aggregating for LoJack and its Subsidiaries not more
        than
        the Dollar Equivalent of $2,500,000 during any fiscal year of
        LoJack;

       

      (i)           contracts,
        agreements or business arrangements among any of the Borrowers.

       

      §
        9.5  [Reserved]. 

       

      §
        9.6  Burdensome Contracts With Affiliates. 

       

      Except
        for any transactions permitted under § 9.4, none of the Borrowers shall,
        nor shall it permit any Subsidiary to, enter into any contract, agreement
        or
        business arrangement with any of its Affiliates on terms and conditions which
        are materially less favorable to such Borrower or such Subsidiary than would
        be
        usual and customary in similar contracts, agreements or business arrangements
        between Persons not affiliated with each other.

       

      §
        9.7  No Changes in Fiscal Year. 

       

      
        
          
          

        

        
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      The
        fiscal year of LoJack ends on December 31st of each year; and LoJack shall
        not
        change its fiscal year from its present basis without the prior written consent
        of the Required Lenders.

       

      §
        9.8  Change in the Nature of Business. 

       

      None
        of
        the Borrowers shall, nor shall it permit any Subsidiary to, engage in any
        business or activity if as a result the general nature of the business of
        LoJack
        and its Subsidiaries, taken as a whole, would be changed in any material
        respect
        from the general nature of the business engaged in by it as of the Closing
        Date.

       

      §
        9.9  No Restrictions. 

       

      Except
        as
        provided herein or in any agreements documenting purchase money indebtedness
        or
        Capitalized Lease Obligations permitted under Section 9.1(b) or a line of
        credit
        permitted under Section 9.1(g), none of the Borrowers shall, nor shall it
        permit
        any Subsidiary to, directly or indirectly create or otherwise cause or suffer
        to
        exist or become effective any consensual encumbrance or restriction of any
        kind
        on the ability of any Borrower or any Subsidiary to: (a) pay dividends or
        make
        any other distribution on any Subsidiary’s capital stock or other equity
        interests owned by any Borrower or any other Subsidiary, (b) pay any
        indebtedness owed to any Borrower or any other Subsidiary, (c) make loans
        or
        advances to any Borrower or any other Subsidiary, (d) transfer any of its
        Property to any Borrower or any other Subsidiary, (e) guarantee the Obligations
        as required by the Loan Documents, or (f) create, incur or permit to exist
        any
        Lien upon any of its property or assets.

       

      §
        9.10  No Stock Repurchase.

       

      The
        Borrowers shall not, and shall not permit any other Loan Party to, unless
        otherwise consented to in writing by the Administrative Agent, redeem, convert,
        retire or otherwise acquire shares of any class of Capital Stock of the
        Borrowers; provided, that, so long as no Default or Event of Default exists
        or
        would otherwise be created by the consummation of such a repurchase transaction,
        any Loan Party may (i) repurchase Capital Stock of the Borrowers if the Funded
        Debt to EBITDA Ratio is less than or equal to 2.5 to 1 (both before and after
        giving effect to such repurchase); or (ii) if Funded Debt to EBITDA Ratio
        is
        greater than 2.5 to 1 (both before and after giving effect to such repurchase)
        repurchase Capital Stock of the Borrowers for a consideration (excluding
        consideration consisting of common shares of LoJack) of not exceeding
        $10,000,000 in the aggregate for the twelve-month period preceding such
        repurchase.

       

      §
        10.  FINANCIAL COVENANTS.

       

      Each
        of
        the Borrowers covenants and agrees that, so long as the Commitments shall
        be in
        effect, or any Loan, Letter of Credit or other Obligation hereunder shall
        remain
        outstanding:

       

      §
        10.1  Fixed Charge Coverage Ratio. 

       

      As
        at the
        end of any quarter commencing with the quarter ending June 30, 2007, the
        ratio
        of Consolidated EBITDA for the four (4) consecutive fiscal quarters ending
        on
        that date to Consolidated Fixed Charges for such period (the “Fixed Charge
        Coverage Ratio”) shall not at any time be less than 1.25:1.00.

       

      §
        10.2  Funded Debt to EBITDA Ratio.  

       

      As
        at the
        end of any quarter commencing with the quarter ending June 30, 2007, the
        ratio
        of Consolidated Funded Debt to Consolidated EBITDA for the four (4) consecutive
        fiscal quarters of the

       

      
        
          
          

        

        
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      Borrowers
        ending on such date (the “Funded Debt to EBITDA Ratio”) shall not at any time
        exceed 3:1.00.

       

      §
        10.3  Capital Expenditures.  

       

      The
        Borrowers shall not suffer or permit their Consolidated Capital Expenditures
        in
        any fiscal year to exceed $15,000,000 in the aggregate.

       

      §
        11.  GUARANTIES; PLEDGE OF CERTAIN STOCK.

       

      §
        11.1  Guaranties.

       

      (a)           In
        order to induce the Lenders to extend credit to the other Borrowers
        hereunder:

       

      (i)           each
        of the U.S. Borrowers and each of the U.S. Guarantors hereby irrevocably
        and
        unconditionally guarantees, as a primary obligor and not merely as a surety,
        the
        payment when and as due of the Obligations of, in the case of a U.S. Borrower,
        such other Borrowers, and, in the case of the U.S. Guarantors, the Borrowers,
        and agrees that the due and punctual payment of such Obligations may be extended
        or renewed, in whole or in part, without notice to or further assent from
        it,
        and that it will remain bound upon its guarantee hereunder notwithstanding
        any
        such extension or renewal of any such Obligation; and

       

      (ii)           each
        of the Canadian Borrowers and any Canadian Guarantor hereby irrevocably and
        unconditionally guarantees, as a primary obligor and not merely as a surety,
        the
        payment when and as due of the Canadian Obligations of, in the case of a
        Canadian Borrower, such other Canadian Borrowers and, in the case of any
        Canadian Guarantor, the Canadian Borrowers, and agrees that the due and punctual
        payment of such Canadian Obligations may be extended or renewed, in whole
        or in
        part, without notice to or further assent from it, and that it will remain
        bound
        upon its guarantee hereunder notwithstanding any such extension or renewal
        of
        any such Canadian Obligations.

       

      (b)           Each
        of the U.S. Borrowers and the Canadian Borrowers, and each U.S. Guarantor
        and
        Canadian Guarantor waives presentment to, demand of payment from and protest
        to
        any other Loan Party of any of the Obligations, and also waives notice of
        acceptance of its obligations and notice of protest for
        nonpayment.  The obligations of the Guarantors hereunder shall not be
        affected by (i) the failure of either Administrative Agent, the Issuing Bank
        or
        any Lender to assert any claim or demand or to enforce any right or remedy
        against any Loan Party under the provisions of this Agreement, any other
        Loan
        Document or otherwise; (ii) any extension or renewal of any of the Obligations;
        (iii) any rescission, waiver, amendment or modification of, or release from,
        any
        of the terms or provisions of this Agreement, or any other Loan Document
        or
        agreement; (iv) any default, failure or delay, willful or otherwise, in the
        performance of any of the Obligations; (v) the failure of either Administrative
        Agent to take any steps to perfect and maintain any security interest in,
        or to
        preserve any rights to, any security or collateral for the Obligations, if
        any;
        (vi) any change in the corporate, partnership or other existence, structure
        or
        ownership of any Loan Party or any other guarantor of any of the Obligations;
        (vii) the enforceability or validity of the Obligations or any part thereof
        or
        the genuineness, enforceability or validity of any agreement relating thereto
        or
        with respect to any collateral securing the Obligations or any part thereof,
        or
        any other invalidity or unenforceability relating to or against any Loan
        Party
        or any other guarantor of any of the Obligations, for any reason related
        to this
        Agreement, any Swap Contract, any other Loan Document, or any provision of
        applicable law, decree, order or regulation of any jurisdiction purporting
        to
        prohibit the payment by such Borrower or any other guarantor of the Obligations,
        of any of the Obligations or otherwise affecting any term of any of the
        Obligations; or (viii) any other act, omission or

       

      
        
          
          

        

        
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      delay
        to
        do any other act which may or might in any manner or to any extent vary the
        risk
        of such Borrower or otherwise operate as a discharge of a guarantor as a
        matter
        of law or equity or which would impair or eliminate any right of such Loan
        Party
        to subrogation.

       

      (c)           Each
        of the Loan Parties further agrees that its agreement hereunder constitutes
        a
        guarantee of payment when due (whether or not any bankruptcy or similar
        proceeding shall have stayed the accrual or collection of any of the Obligations
        or operated as a discharge thereof) and not merely of collection, and waives
        any
        right to require that any resort be had by either Administrative Agent, the
        Issuing Bank or any Lender to any balance of any deposit account or credit
        on
        the books of either Administrative Agent, the Issuing Bank or any Lender
        in
        favor of any Loan Party or any other Person.

       

      (d)           The
        obligations of the Loan Parties hereunder shall not be subject to any reduction,
        limitation, impairment or termination for any reason, and shall not be subject
        to any defense or set-off, counterclaim, recoupment or termination whatsoever,
        by reason of the invalidity, illegality or unenforceability of any of the
        Obligations, any impossibility in the performance of any of the Obligations
        or
        otherwise, except for the prior indefeasible payment in full in cash of all
        the
        Obligations.

       

      (e)           Each
        of the Loan Parties further agrees that its obligations hereunder shall continue
        to be effective or be reinstated, as the case may be, if at any time payment,
        or
        any part thereof, of any Obligation is rescinded or must otherwise be restored
        by either Administrative Agent, the Issuing Bank or any Lender upon the
        bankruptcy or reorganization of any Loan Party or otherwise.

       

      (f)           Upon
        payment by any of the Loan Parties of any sums as provided above, all rights
        of
        the Loan Parties, as the case may be, against any other Loan Party arising
        as a
        result thereof by way of right of subrogation or otherwise shall in all respects
        be subordinated and junior in right of payment to the prior indefeasible
        payment
        in full in cash of all the Obligations owed by such Loan Party to the
        Administrative Agent, the Issuing Bank and the Lenders.

       

      (g)           Nothing
        herein shall discharge or satisfy the liability of the Loan Parties hereunder
        except the full performance and payment in cash of the Obligations.

       

      §
        11.2  Pledge of Stock ofLoJack Equipment Ireland
        Limited

       

      (a)           
        Concurrently herewith, LoJack shall execute a pledge agreement (the “Pledge
        Agreement”) in favor of and in form and substance reasonably satisfactory to
        the Administrative Agent for the benefit of the Lenders with respect to the
        65%
        of all of the outstanding Capital Stock (the “Pledged Equity”) of LoJack
        Equipment Ireland Limited, an Irish company (“LoJack
        Ireland”).  LoJack further agrees to deliver to the Administrative
        Agent all such documentation (including customary legal opinions of its U.S.
        counsel, the stock certificates representing the Pledged Equity subject to
        such
        pledge, stock powers with respect thereto executed in blank, and such other
        documents as shall be reasonably requested to perfect the Lien of such pledge)
        in each case in form and substance reasonably satisfactory to the Administrative
        Agent, and in a manner that the Administrative Agent shall be reasonably
        satisfied that it has a first priority perfected pledge of or charge over
        the
        Pledged Equity related thereto.

       

      (b)           If,
        on the last day of any fiscal year, that portion of Consolidated EBITDA
        contributed by all Loan Parties, LoJack Ireland and any existing Additional
        Pledged Foreign Subsidiary in the aggregate during such fiscal year represents
        less than 75% of Consolidated EBITDA for such fiscal year, then, within 120
        days
        after the date a Compliance Certificate is required to be delivered under
        §8.5(d) hereof for such fiscal year, LoJack shall execute a pledge agreement
        (an
“Additional Pledge Agreement”) in favor of and in form and substance
        reasonably satisfactory to the Administrative Agent for the benefit of the
        Lenders with respect to 65% of all of the outstanding Capital Stock (the
        “Additional Pledged Equity”)

       

      
        
          
          

        

        
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      of
        one or
        more of its Foreign Subsidiaries (each an “Additional Pledged Foreign
        Subsidiary”) such that the portion of Consolidated EBITDA contributed by all
        Loan Parties, LoJack Ireland, any existing Additional Pledged Foreign Subsidiary
        and any such new Additional Pledged Foreign Subsidiary in the aggregate during
        such fiscal year represents at least 85% of Consolidated EBITDA for such
        fiscal
        year.  LoJack further agrees to deliver to the Administrative Agent
        all such documentation (including customary legal opinions of its U.S. counsel,
        the stock certificates representing the Additional Pledged Equity subject
        to
        such pledge, stock powers with respect thereto executed in blank, and such
        other
        documents as shall be reasonably requested to perfect the Lien of such pledge)
        in each case in form and substance reasonably satisfactory to the Administrative
        Agent, and in a manner that the Administrative Agent shall be reasonably
        satisfied that it has a first priority perfected pledge of or charge over
        the
        Additional Pledged Equity related thereto.

       

      §
        11.3  Further Assurances

       

      In
        the
        event any Borrower forms or acquires any U.S. Subsidiary after the date hereof,
        such newly formed or acquired U.S. Subsidiary shall join this Agreement as
        a
        Borrower and as a guarantor under § 11.1 in accordance with the provisions
        of § 8.9(b).

       

      §
        12.  EVENTS OF DEFAULT; ACCELERATION.

       

      §
        12.1  Events of Default and Acceleration. 

       

      Any
        one
        or more of the following shall constitute an “Event of Default”
hereunder:

       

      (a)           default
        in the payment when due of all or any part of the principal of or interest
        on
        any Note (whether at the stated maturity thereof or at any other time provided
        for in this Agreement) or of any Reimbursement Obligation or default for
        a
        period of 5 Business Days in the payment when due of any interest, fee, or
        other
        Obligation payable hereunder or under any other Loan Document;

       

      (b)           default
        in the observance or performance of any covenant set forth in Sections 8.1,
        8.5,
        9 or 10 hereof;

       

      (c)           default
        in the observance or performance of any other provision hereof or of any
        other
        Loan Document which is not remedied within 30 days after the earlier of (i)
        the
        date on which such failure shall first become known to any officer of LoJack
        or
        (ii) written notice thereof is given to LoJack by the Administrative
        Agent;

       

      (d)           any
        representation or warranty made herein or in any other Loan Document or in
        any
        certificate furnished to the Administrative Agent or the Lenders pursuant
        hereto
        or thereto or in connection with any transaction contemplated hereby or thereby
        proves untrue in any material respect as of the date of the issuance or making
        or deemed making thereof;

       

      (e)           any
        event occurs or condition exists (other than those described in subsections
        (a)
        through (d) above) which is specified as an event of default under any of
        the
        other Loan Documents, or any of the Loan Documents shall for any reason not
        be
        or shall cease to be in full force and effect or is declared to be null and
        void, or the Borrowers or any of their Subsidiaries takes any action for
        the
        purpose of repudiating or rescinding any Loan Document executed by it or
        any of
        its obligations thereunder;

       

      (f)           default
        shall occur under any Indebtedness issued, assumed or guaranteed by any of
        the
        Borrowers or any of their Subsidiaries (other than an Immaterial Foreign
        Subsidiary) aggregating in excess of the Dollar Equivalent of $3,000,000,
        or
        under any indenture, agreement or other instrument

       

      
        
          
          

        

        
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      under
        which the same may be issued, and such default shall continue for a period
        of
        time sufficient to permit the acceleration of the maturity of any such
        Indebtedness (whether or not such maturity is in fact accelerated), or any
        such
        Indebtedness shall not be paid when due (whether by demand, lapse of time,
        acceleration or otherwise), subject to the passage of any applicable grace
        or
        notice period;

       

      (g)           any
        judgment or judgments, writ or writs or warrant or warrants of attachment,
        or
        any similar process or processes, shall be entered or filed against any
        Borrower, or any of their Subsidiaries (other than an Immaterial Foreign
        Subsidiary), or against any of their Property, in an aggregate amount in
        excess
        of the Dollar Equivalent of $3,000,000 (except to the extent fully covered
        by
        insurance pursuant to which the insurer has accepted liability therefor in
        writing), and which remains undischarged, unvacated, unbonded or unstayed
        for a
        period of 30 days;

       

      (h)           Any
        of the Borrowers, or any of their Subsidiaries, or any member of its Controlled
        Group, shall fail to pay when due an amount or amounts aggregating in excess
        of
        the Dollar Equivalent of $3,000,000 which it shall have become
        liable to pay to the PBGC or to a Plan under Title IV of ERISA; or notice
        of
        intent to terminate a Plan or Plans having aggregate Unfunded Vested Liabilities
        in excess of the Dollar Equivalent of $3,000,000 (collectively, a "Material
        Plan") shall be filed under Title IV of ERISA by any of the Borrowers, or
        any of their Subsidiaries, or any other member of its Controlled Group, any
        plan
        administrator or any combination of the foregoing; or the PBGC shall institute
        proceedings under Title IV of ERISA to terminate or to cause a trustee to
        be
        appointed to administer any Material Plan or a proceeding shall be instituted
        by
        a fiduciary of any Material Plan against the any of the Borrowers, or any
        of
        their Subsidiaries, or any member of its Controlled Group, to enforce Section
        515 or 4219(c)(5) of ERISA and such proceeding shall not have been dismissed
        within 30 days thereafter; or a condition shall exist by reason of which
        the
        PBGC would be entitled to obtain a decree adjudicating that any Material
        Plan
        must be terminated;

       

      (i)           any
        Change of Control shall occur;

       

      (j)           any
        of the Borrowers, or any of their Subsidiaries (other than an Immaterial
        Foreign
        Subsidiary) shall (i) have entered involuntarily against it an order for
        relief
        under the United States Bankruptcy Code, the Bankruptcy and Insolvency Act
        (Canada), the Companies' Creditors Arrangement Act (Canada), or any other
        legislation respect of bankruptcy, insolvency, or the relief of debtors (all
        as
        amended) in any jurisdiction outside of the United States of Canada in which
        any
        Borrower or Subsidiary is located, (ii) not pay, or admit in writing its
        inability to pay, its debts generally as they become due, (iii) make an
        assignment for the benefit of creditors, (iv) apply for, seek, consent to
        or
        acquiesce in, the appointment of a receiver, interim receiver, custodian,
        trustee, examiner, liquidator or similar official for it or any substantial
        part
        of its Property, (v) institute any proceeding (including, without limitation,
        any assignment, proposal, or notice of intention to make a proposal) seeking
        relief under the United States Bankruptcy Code, the Bankruptcy and Insolvency
        Act (Canada), the Companies' Creditors Arrangement Act (Canada), or any other
        legislation respect of bankruptcy, insolvency, or the relief of debtors (all
        as
        amended), to adjudicate it insolvent, or seeking dissolution, winding up,
        liquidation, reorganization, arrangement, adjustment or composition of it
        or its
        debts under any law relating to bankruptcy, insolvency or reorganization
        or
        relief of debtors or fail to file an answer or other pleading denying (or
        shall
        admit) the material allegations of any such proceeding filed against it,
        (vi)
        take any action in furtherance of any matter described in parts (i) through
        (v)
        above, or (vii) fail to contest in good faith any appointment or proceeding
        described in Section 9.1(k) hereof; or

       

      (k)           a
        custodian, monitor, receiver, receiver and manager, interim receiver, trustee,
        examiner, liquidator or similar official (a “Receiver”) shall be
        appointed for any of the Borrowers, or any of their Subsidiaries (other than
        an
        Immaterial Foreign Subsidiary), or any substantial part of any of their
        Property, or a proceeding described in Section 12.1(j)(v) shall be instituted
        against the Borrowers or any

       

      
        
          
          

        

        
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      of
        their
        Subsidiaries, and such appointment continues undischarged or such proceeding
        continues undismissed or unstayed for a period of 60 days or if, within such
        period, a Receiver or creditor shall take possession of any Property of any
        of
        the Borrowers, or any of their Subsidiaries.

       

      §
        12.2  Remedies Upon Event of Default.  

       

      If
        any
        Event of Default occurs and is continuing, the Administrative Agent may,
        and at
        the request of the Required Lenders shall, take any or all of the following
        actions:

       

      (a)           declare
        the Commitments (including, for the avoidance of doubt, the Canadian Revolving
        Credit Commitments) to be terminated, whereupon the Commitments (including,
        for
        the avoidance of doubt, the Canadian Revolving Credit Commitments) shall
        be
        terminated;

       

      (b)           declare
        the unpaid principal amount of all outstanding Loans, all interest accrued
        and
        unpaid thereon, the face amount of all Bankers’ Acceptances accepted by the
        Canadian Lender and outstanding and acceptances thereunder and all other
        amounts
        owing or payable hereunder or under any other Loan Document to be immediately
        due and payable, without presentment, demand, protest or other notice of
        any
        kind, all of which are hereby expressly waived by the Borrowers;

       

      (c)           require
        that the applicable Borrowers Cash Collateralize the L/C Obligations including
        for greater certainty those resulting from the Letters of Credit issued by
        the
        Canadian Lender (in an amount equal to the then Outstanding Amount thereof);
        and

       

      (d)           exercise
        all rights and remedies available to it under the Loan Documents or applicable
        law;

       

      provided,
        however, that upon the occurrence of an actual or deemed entry of an
        order for relief with respect to the Borrowers under any of the proceedings
        or
        laws described in § 12.1(j) or (k), the Commitments shall automatically
        terminate, the Outstanding Amount of all Loans and all interest, the face
        amount
        of all Bankers’ Acceptances accepted by the Canadian Lender and outstanding
        thereunder and all other amounts as aforesaid shall automatically become
        due and
        payable, and the obligation of the applicable Borrowers to Cash Collateralize
        the L/C Obligations as aforesaid shall automatically become effective, in
        each
        case without further act of the Lenders.

       

      §
        12.3  Judgment Currency.  

       

      If,
        for
        the purposes of obtaining judgment in any court, it is necessary to convert
        a
        sum due hereunder or any other Loan Document in one currency into another
        currency, the rate of exchange used shall be that at which in accordance
        with
        normal banking procedures the Administrative Agent could purchase the first
        currency with such other currency on the Business Day preceding that on which
        final judgment is given.  The obligation of the Borrowers in respect
        of any such sum due from it to the Lenders or under the other Loan Documents
        shall, notwithstanding any judgment in a currency (the “Judgment Currency”)
        other than that in which such sum is denominated in accordance with the
        applicable provisions of this Agreement (the “Agreement Currency”), be
        discharged only to the extent that on the Business Day following receipt
        by the
        Lenders of any sum adjudged to be so due in the Judgment Currency, each of
        the
        Lenders may in accordance with normal banking procedures purchase the Agreement
        Currency with the Judgment Currency.  If the amount of the Agreement
        Currency so purchased is less than the sum originally due to a Lender, the
        Borrowers agree, as a separate obligation and notwithstanding any such judgment,
        to indemnify such Lender.  If the amount of the Agreement Currency so
        purchased is greater than the sum originally due to a Lender in such currency,
        such Lender

       

      
        
          
          

        

        
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      agrees
        to
        return the amount of any excess to the Borrowers (or to any other Person
        who may
        be entitled thereto under applicable law).

       

      §
        12.4  Distribution of Collateral Proceeds.

       

      In
        the
        event that, following the occurrence or during the continuance of any Default
        or
        Event of Default, the Administrative Agent receives any monies in connection
        with the enforcement of the Pledge Agreement or any Additional Pledge
        Agreements, or otherwise with respect to the realization upon any of the
        Pledged
        Equity or Additional Pledged Equity, such monies shall be distributed for
        application as follows:

      

      (a)           First,
        to the payment of, or (as the case may be) the reimbursement of the
        Administrative Agent for or in respect of all reasonable out-of-pocket costs,
        expenses, disbursements and losses which shall have been incurred or sustained
        by the Administrative Agent in connection with the collection of such monies
        by
        the Administrative Agent, for the exercise, protection or enforcement by
        the
        Administrative Agent of all or any of the rights, remedies, powers and
        privileges of the Administrative Agent under this Credit Agreement or any
        of the
        other Loan Documents or in respect of the Pledged Equity or in support of
        any
        provision of adequate indemnity to the Administrative Agent against any taxes
        or
        liens which by law shall have, or may have, priority over the rights of the
        Administrative Agent to such monies;

       

      (b)           Second,
        to all other Obligations; provided that distributions shall be made
        (A)  pari  passu among the Obligations (including the
        Drawing Amount of all outstanding Letters of Credit); provided, that upon
        the
        reduction, cancellation, expiration or termination of any Letter of Credit,
        the
        Drawing Amount of all outstanding Letters of Credit which has been included
        as
        an Obligation and any cash collateral held for the benefit of the Lenders
        in
        respect thereto will be redistributed  pari  passu to
        the Lenders in accordance with this § 12.4(b)(A), and (B) with respect to each
        type of Obligation owing to the Lenders, such as interest, principal, fees
        and
        expenses, among the Lenders  pro rata in accordance with
        the amount of all such Obligations outstanding;

       

      (c)           Third,
        upon payment and satisfaction in full or other provisions for payment in
        full
        satisfactory to the Lenders and the Administrative Agent of all of the
        Obligations, to the payment of any obligations required to be paid pursuant
        to §
9-608(a)(1)(C) or 9-615(a)(3) of the Uniform Commercial Code of the Commonwealth
        of Massachusetts; and

       

      (d)           Fourth,
        the excess, if any, shall be returned to the Borrowers or to such other Persons
        as are entitled thereto.

       

      §
        13.  ADMINISTRATIVE AGENT.

       

      §
        13.1  Appointment and Authority.  

       

      Each
        of
        the Lenders and the Issuing Bank hereby irrevocably appoints Citizens Bank
        of
        Massachusetts to act on its behalf as the Administrative Agent hereunder
        and
        under the other Loan Documents and authorizes the Administrative Agent to
        take
        such actions on its behalf and to exercise such powers as are delegated to
        the
        Administrative Agent by the terms hereof or thereof, together with such actions
        and powers as are reasonably incidental thereto.  The provisions of
        this Article are solely for the benefit of the Administrative Agent, the
        Lenders
        and the Issuing Bank, and neither the Borrowers nor any other Loan Party
        shall
        have rights as a third party beneficiary of any of such provisions.

       

      §
        13.2  Rights as Lender.  

       

      
        
          
          

        

        
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      The
        Person serving as the Administrative Agent hereunder shall have the same
        rights
        and powers in its capacity as a Lender as any other Lender and may exercise
        the
        same as though it were not the Administrative Agent and the term “Lender” or
“Lenders” shall, unless otherwise expressly indicated or unless the context
        otherwise requires, include the Person serving as the Administrative Agent
        hereunder in its individual capacity.  Such Person and its Affiliates
        may accept deposits from, lend money to, act as the financial advisor or
        in any
        other advisory capacity for and generally engage in any kind of business
        with
        any of the Borrowers or any Subsidiary or other Affiliate thereof as if such
        Person were not the Administrative Agent hereunder and without any duty to
        account therefor to the Lenders.

       

      §
        13.3  Exculpatory Provisions.  

       

      (a)           The
        Administrative Agent shall not have any duties or obligations except those
        expressly set forth herein and in the other Loan Documents.  Without
        limiting the generality of the foregoing, the Administrative Agent:

       

      (i)           shall
        not be subject to any fiduciary or other implied duties, regardless of whether
        an Event of Default has occurred and is continuing;

       

      (ii)           shall
        not have any duty to take any discretionary action or exercise any discretionary
        powers, except discretionary rights and powers expressly contemplated hereby
        or
        by the other Loan Documents that the Administrative Agent is required to
        exercise as directed in writing by the Required Lenders (or such other number
        or
        percentage of the Lenders as shall be expressly provided for herein or in
        the
        other Loan Documents), provided that the Administrative Agent shall not be
        required to take any action that, in its opinion or the opinion of its counsel,
        may expose the Administrative Agent to liability or that is contrary to any
        Loan
        Document or applicable law; an

       

      (iii)           shall
        not, except as expressly set forth herein and in the other Loan Documents,
        have
        any duty to disclose, and shall not be liable for the failure to disclose,
        any
        information relating to any of the Borrowers or any of its Affiliates that
        is
        communicated to or obtained by the Person serving as the Administrative Agent
        or
        any of its Affiliates in any capacity.

       

      (b)           The
        Administrative Agent shall not be liable for any action taken or not taken
        by it
        (i) with the consent or at the request of the Required Lenders (or such other
        number or percentage of the Lenders as shall be necessary, or as the
        Administrative Agent shall believe in good faith shall be necessary, under
        the
        circumstances as provided in §§14.11) or (ii) in the absence of its own gross
        negligence or willful misconduct.  The Administrative Agent shall be
        deemed not to have knowledge of any Event of Default unless and until notice
        describing such Event of Default is given to the Administrative Agent by
        the
        Borrowers, a Lender or the Issuing Bank.

       

      (c)           The
        Administrative Agent shall not be responsible for or have any duty to ascertain
        or inquire into (i) any statement, warranty or representation made in or
        in
        connection with this Agreement or any other Loan Document, (ii) the contents
        of
        any certificate, report or other document delivered hereunder or thereunder
        or
        in connection herewith or therewith, (iii) the performance or observance
        of any
        of the covenants, agreements or other terms or conditions set forth herein
        or
        therein or the occurrence of any Event of Default, (iv) the validity,
        enforceability, effectiveness or genuineness of this Agreement, any other
        Loan
        Document or any other agreement, instrument or document or (v) the satisfaction
        of any condition set forth in §6 or elsewhere herein, other than to confirm
        receipt of items expressly required to be delivered to the Administrative
        Agent.

       

      §
        13.4  Reliance by Administrative Agent.  

       

      
        
          
          

        

        
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      The
        Administrative Agent shall be entitled to rely upon, and shall not incur
        any
        liability for relying upon, any notice, request, certificate, consent,
        statement, instrument, document or other writing (including any electronic
        message, Internet or intranet website posting or other distribution) believed
        by
        it to be genuine and to have been signed, sent or otherwise authenticated
        by the
        proper Person.  The Administrative Agent also may rely upon any
        statement made to it orally or by telephone and believed by it to have been
        made
        by the proper Person, and shall not incur any liability for relying
        thereon.  In determining compliance with any condition hereunder to
        the making of a Loan, or the issuance of a Letter of Credit, that by its
        terms
        must be fulfilled to the satisfaction of a Lender or the Issuing Bank, the
        Administrative Agent may presume that such condition is satisfactory to such
        Lender or the Issuing Bank unless the Administrative Agent shall have received
        notice to the contrary from such Lender or the Issuing Bank prior to the
        making
        of such Loan or the issuance of such Letter of Credit.  The
        Administrative Agent may consult with legal counsel (who may be counsel for
        the
        Borrowers), independent accountants and other experts selected by it, and
        shall
        not be liable for any action taken or not taken by it in accordance with
        the
        advice of any such counsel, accountants or experts.

       

      §
        13.5  Delegation of Duties.  

       

      The
        Administrative Agent may perform any and all of its duties and exercise its
        rights and powers hereunder or under any other Loan Document by or through
        any
        one or more sub agents appointed by the Administrative Agent.  The
        Administrative Agent and any such sub agent may perform any and all of its
        duties and exercise its rights and powers by or through their respective
        agents.  The exculpatory provisions of this §13 shall apply to any
        such sub agent and to the Related Parties of the Administrative Agent and
        any
        such sub agent, and shall apply to their respective activities in connection
        with the syndication of the credit facilities provided for herein as well
        as
        activities as Administrative Agent.

       

      §
        13.6  Resignation of Administrative
        Agent.  

       

      The
        Administrative Agent may at any time give notice of its resignation to the
        Lenders, the Issuing Bank and the Borrowers.  Upon receipt of any such
        notice of resignation, the Required Lenders shall have the right, in
        consultation with the Borrowers, to appoint a successor, which shall be a
        bank
        or other financial institution.  If no such successor shall have been
        so appointed by the Required Lenders and shall have accepted such appointment
        within 30 days after the retiring Administrative Agent gives notice of its
        resignation, then the retiring Administrative Agent may on behalf of the
        Lenders
        and the Issuing Bank, appoint a successor Administrative Agent meeting the
        qualifications set forth above provided that if the Administrative Agent
        shall
        notify the Borrowers and the Lenders that no qualifying Person has accepted
        such
        appointment, then such resignation shall nonetheless become effective in
        accordance with such notice and (a) the retiring Administrative Agent shall
        be
        discharged from its duties and obligations hereunder and under the other
        Loan
        Documents (except that in the case of any collateral security held by the
        Administrative Agent on behalf of the Lenders or the Issuing Bank under any
        of
        the Loan Documents, the retiring Administrative Agent shall continue to hold
        such collateral security until such time as a successor Administrative Agent
        is
        appointed) and (b) all payments, communications and determinations provided
        to
        be made by, to or through the Administrative Agent shall instead be made
        by or
        to each Lender and the Issuing Bank directly, until such time as the Required
        Lenders appoint a successor Administrative Agent as provided for above in
        this
§13.6.  Upon the acceptance of a successor’s appointment as
        Administrative Agent hereunder, such successor shall succeed to and become
        vested with all of the rights, powers, privileges and duties of the retiring
        (or
        retired) Administrative Agent, and the retiring Administrative Agent shall
        be
        discharged from all of its duties and obligations hereunder or under the
        other
        Loan Documents (if not already discharged therefrom as provided above in
        this
§13.6).  The fees payable by the Borrowers to a successor
        Administrative Agent shall be the same as those payable to its predecessor
        unless otherwise agreed between the Borrowers and such
        successor.  After the retiring Administrative Agent’s resignation
        hereunder and under the other Loan Documents, the provisions of
        this

       

      
        
          
          

        

        
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      §13
        shall
        continue in effect for the benefit of such retiring Administrative Agent,
        its
        sub agents and their respective Related Parties in respect of any actions
        taken
        or omitted to be taken by any of them while the retiring Administrative Agent
        was acting as Administrative Agent.

       

      §
        13.7  Non-Reliance on Administrative Agent and the Other
        Lenders.

       

      Each
        Lender and the Issuing Bank acknowledges that it has, independently and without
        reliance upon the Administrative Agent or any other Lender or any of their
        Related Parties and based on such documents and information as it has deemed
        appropriate, made its own credit analysis and decision to enter into this
        Agreement.  Each Lender and the Issuing Bank also acknowledges that it
        will, independently and without reliance upon the Administrative Agent or
        any
        other Lender or any of their Related Parties and based on such documents
        and
        information as it shall from time to time deem appropriate, continue to make
        its
        own decisions in taking or not taking action under or based upon this Agreement,
        any other Loan Document or any related agreement or any document furnished
        hereunder or thereunder.

       

      §
        13.8  No Other Duties, etc.  

       

      Anything
        herein to the contrary notwithstanding, no other parties listed on the cover
        page hereof, if any, shall have any powers, duties or responsibilities under
        this Agreement or any of the other Loan Documents, except in its capacity,
        as
        applicable, as the Administrative Agent, a Lender or the Issuing Bank
        hereunder.

       

      §
        13.9  Payments to Administrative Agent  

       

      A
        payment
        by any of the Borrowers to the Administrative Agent hereunder or any of the
        other Loan Documents for the account of any Lender shall constitute a payment
        to
        such Lender.  The Administrative Agent agrees promptly to distribute
        to each Lender such Lender’s pro rata share of payments received by the
        Administrative Agent for the account of the Lenders (except as otherwise
        expressly provided herein or in any of the other Loan Documents).

       

      §
        14.  MISCELLANEOUS.

       

      §
        14.1  Setoff Rights. 

       

      (a)           In
        addition to any rights and remedies of the Lender provided by law, if an
        Event
        of Default shall have occurred and be continuing, each Lender, the Issuing
        Bank,
        and each of their respective Affiliates is hereby authorized at any time
        and
        from time to time, to the fullest extent permitted by applicable law, to
        set off
        and apply any and all deposits (general or special, time or demand, provisional
        or final, in whatever currency) at any time held and other obligations (in
        whatever currency) at any time owing by such Lender, the Issuing Bank or
        any
        such Affiliate to or for the credit or the account of the Borrowers or any
        other
        Loan Party against any and all of the obligations of the Borrowers or such
        Loan
        Party now or hereafter existing under this Agreement or any other Loan Document
        to such Lender or the Issuing Bank, irrespective of whether or not such Lender
        or the Issuing Bank shall have made any demand under this Agreement or any
        other
        Loan Document and although such obligations of the Borrower or such Loan
        Party
        may be contingent or unmatured or are owed to a branch or office of such
        Lender
        or the Issuing Bank different from the branch or office holding such deposit
        or
        obligated on such indebtedness.  The rights of each Lender, the
        Issuing Bank and their respective Affiliates under this Section are in addition
        to other rights and remedies (including other rights of setoff) that such
        Lender, the Issuing Bank or their respective Affiliates may
        have.  Each Lender and the Issuing Bank agrees to notify

       

      
        
          
          

        

        
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      the
        Borrowers and the Administrative Agent promptly after any such setoff and
        application, provided that the failure to give such notice shall not affect
        the
        validity of such setoff and application.

       

      (b)           If
        any Lender shall, by exercising any right of setoff or counterclaim or
        otherwise, obtain payment in respect of any principal of or interest on any
        of
        its Loans or other obligations hereunder resulting in such Lender’s receiving
        payment of a proportion of the aggregate amount of its Loans and accrued
        interest thereon or other such obligations greater than its pro rata share
        thereof as provided herein, then the Lender receiving such greater proportion
        shall (a) notify the Administrative Agent of such fact, and (b) purchase
        (for
        cash at face value) participations in the Loans and such other obligations
        of
        the other Lenders, or make such other adjustments as shall be equitable,
        so that
        the benefit of all such payments shall be shared by the Lenders ratably in
        accordance with the aggregate amount of principal of and accrued interest
        on
        their respective Loans and other amounts owing them, provided that:

       

      (i)           if
        any such participations are purchased and all or any portion of the payment
        giving rise thereto is recovered, such participations shall be rescinded
        and the
        purchase price restored to the extent of such recovery, without interest;
        and

       

      (ii)           the
        provisions of this §14.1 shall not be construed to apply to (x) any payment made
        by the Borrowers pursuant to and in accordance with the express terms of
        this
        Agreement or (y) any payment obtained by a Lender as consideration for the
        assignment of or sale of a participation in any of its Loans or participations
        in LC Obligations to any assignee or participant, other than to the Borrowers
        or
        any Subsidiary thereof (as to which the provisions of this paragraph shall
        apply).

       

      (c)           Each
        of the Borrowers consents to the foregoing and agrees, to the extent it may
        effectively do so under applicable law, that any Lender acquiring a
        participation pursuant to the foregoing arrangements may exercise against
        each
        Borrower rights of setoff and counterclaim with respect to such participation
        as
        fully as if such Lender were a direct creditor of such Borrower in the amount
        of
        such participation.

       

      §
        14.2  Attorney Costs; Expenses. 

       

      The
        Borrowers agree (a) to pay or reimburse the Administrative Agent for all
        costs
        and expenses reasonably incurred in connection with the development, due
        diligence review, preparation, negotiation and execution of this Agreement
        and
        the other Loan Documents and any amendment, waiver, consent or other
        modification of the provisions hereof and thereof (whether or not the
        transactions contemplated hereby or thereby are consummated), and the
        consummation and administration of the transactions contemplated hereby and
        thereby, including all Attorney Costs, and (b) to pay or reimburse the
        Administrative Agent for all reasonable costs and expenses incurred in
        connection with the enforcement, attempted enforcement, or preservation of
        any
        rights or remedies under this Agreement or the other Loan Documents (including
        all such costs and expenses incurred during any “workout” or restructuring in
        respect of the Obligations and during any legal proceeding, including any
        proceeding under any Debtor Relief Law), including all Attorney
        Costs.  The foregoing costs and expenses shall include, without
        limitation, all search, filing and recording fees and any taxes related thereto,
        and other out-of-pocket expenses incurred by the Administrative Agent and
        the
        cost of independent public accountants and other outside experts retained
        by the
        Administrative Agent.  All amounts due under this §14.2 shall be
        payable within two (2) Business Days after demand therefor.  The
        agreements in this §14.2 shall survive the termination of the Commitments and
        repayment, satisfaction or discharge of all other Obligations.

       

      §
        14.3  Indemnification. 

       

      
        
          
          

        

        
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      Whether
        or not the transactions contemplated hereby are consummated, the Borrowers
        shall
        indemnify and hold harmless the Administrative Agent, its Affiliates and
        the
        Lenders, its Affiliates, and their respective directors, officers, employees,
        counsel, agents and attorneys-in-fact (collectively the “Indemnitees”) from and
        against any and all liabilities, obligations, losses, damages, penalties,
        claims, demands, actions, judgments, suits, costs, expenses and disbursements
        (including Attorney Costs) of any kind or nature whatsoever which may at
        any
        time be imposed on, incurred by or asserted against any such Indemnitee in
        any
        way relating to or arising out of or in connection with (a) the execution,
        delivery, enforcement, performance or administration of any Loan Document
        or any
        other agreement, letter or instrument delivered in connection with the
        transactions contemplated thereby or the consummation of the transactions
        contemplated thereby, (b) the Commitments, any Loan or Letter of Credit or
        the
        use or proposed use of the proceeds therefrom (including any refusal by the
        Issuing Bank to honor a demand for payment under a Letter of Credit if the
        documents presented in connection with such demand do not strictly comply
        with
        the terms of such Letter of Credit), (c) any Environmental Liability related
        in
        any way to any of the Borrowers, any Subsidiary or any other Loan Party,
        or (d)
        any actual or prospective claim, litigation, investigation or proceeding
        relating to any of the foregoing, whether based on contract, tort or any
        other
        theory (including any investigation of, preparation for, or defense of any
        pending or threatened claim, investigation, litigation or proceeding) and
        regardless of whether any Indemnitee is a party thereto (all the foregoing,
        collectively, the “Indemnified Liabilities”), provided that such indemnity shall
        not, as to any Indemnitee, be available to the extent that such liabilities,
        obligations, losses, damages, penalties, claims, demands, actions, judgments,
        suits, costs, expenses or disbursements are determined by a court of competent
        jurisdiction by final and nonappealable judgment to have resulted from the
        gross
        negligence or willful misconduct of such Indemnitee.  No Indemnitee
        shall have any liability for any indirect or consequential damages relating
        to
        this Agreement or any other Loan Document or arising out of its activities
        in
        connection herewith or therewith (whether before or after the Closing
        Date).  All amounts due under this §14.3 shall be due and payable
        within five (5) Business Days after demand therefor.  The agreements
        in this §14.3 shall survive the termination of the Commitment and the repayment,
        satisfaction or discharge of all the other Obligations.

       

      §
        14.4  Representations and Warranties. 

       

      All
        representations and warranties made hereunder and in any other Loan Document
        or
        other document delivered pursuant hereto or thereto or in connection herewith
        or
        therewith shall survive the execution and delivery hereof and
        thereof.  Such representations and warranties have been or will be
        relied upon by the Administrative Agent and the Lenders, regardless of any
        investigation made by the Administration Agent or any Lender or on its behalf
        and notwithstanding that the Administration Agent or any Lender may have
        had
        notice or knowledge of any Event of Default at the time of any Credit Extension,
        and shall continue in full force and effect as long as the Commitments, any
        Loan
        or any other Obligation hereunder shall remain unpaid or unsatisfied or any
        Letter of Credit shall remain outstanding.

       

      §
        14.5  Payments; Set Aside. 

       

      To
        the
        extent that any payment by or on behalf of any Borrower is made to the
        Administrative Agent or any Lender, or the Administrative Agent or any Lender
        exercises its right of set-off, and such payment or the proceeds of such
        set-off
        or any part thereof is subsequently invalidated, declared to be fraudulent
        or
        preferential, set aside or required (including pursuant to any settlement
        entered into by the Administrative Agent or any Lender in its discretion)
        to be
        repaid to a trustee, receiver or any other party, in connection with any
        proceeding under any debtor relief or similar law or otherwise, then, to
        the
        extent of such recovery, the obligation or part thereof originally intended
        to
        be satisfied shall be revived and continued in full force and effect as if
        such
        payment had not been made or such set-off had not occurred.

       

      §
        14.6  Successors and Assigns; Participations. 

       

      
        
          
          

        

        
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      (a)           Binding
        Agreement.  The provisions of this Agreement shall be binding upon
        and inure to the benefit of the parties hereto and their respective successors
        and assigns permitted hereby, except that the Borrowers may not assign or
        otherwise transfer any of their rights or obligations hereunder without the
        prior written consent of the Lenders, to be granted in the sole discretion
        of
        the Lenders, and the Lenders may not assign or otherwise transfer any of
        their
        rights or obligations hereunder except (i) to an Eligible Assignee in accordance
        with the provisions of subsection (b) of this Section or (ii) any bank or
        financial institution with the prior consent of the Borrowers, not to be
        unreasonably withheld or delayed.  Nothing in this Agreement,
        expressed or implied, shall be construed to confer upon any Person (other
        than
        the parties hereto, their respective successors and assigns permitted hereby,
        and, to the extent expressly contemplated hereby, the Indemnitees) any legal
        or
        equitable right, remedy or claim under or by reason of this
        Agreement.

       

      (b)           Assignments
        by Lenders.  Any Lender may at any time assign to one or more
        assignees all or a portion of its rights and obligations under this Agreement
        (including all or a portion of its Commitment and the Loans at the time owing
        to
        it); provided that any such assignment shall be subject to the following
        conditions:

       

      (i)           Minimum
        Amounts.

       

      
        	
                 

              	
                (A)

              	
                in
                  the case of an assignment of the entire remaining amount of the
                  assigning
                  Lender’s Commitment and the Loans at the time owing to it or in the case
                  of an assignment to a Lender, an Affiliate of a Lender or an Approved
                  Fund, no minimum amount need be assigned;
                  and

              

      

       

      
        	
                 

              	
                (B)

              	
                in
                  any case not described in paragraph (b)(i)(A) of this §14.6, the aggregate
                  amount of the Commitment (which for this purpose includes Loans
                  outstanding thereunder) or, if the applicable Commitment is not
                  then in
                  effect, the Outstanding Amount of the Loans of the assigning Lender
                  subject to each such assignment (determined as of the date the
                  Assignment
                  and Assumption with respect to such assignment is delivered to
                  the
                  Administrative Agent or, if “Trade Date” is specified in the Assignment
                  and Assumption, as of the Trade Date) shall not be less than $5,000,000,
                  in the case of any assignment in respect of Revolving Credit Loans
                  or the
                  Revolving Credit Commitment, $1,000,000, in the case of any assignment
                  in
                  respect of the Term Loan or Can. $1,000,000, in the case of any
                  assignment
                  in respect of Canadian Revolving Credit Loans or the Canadian Revolving
                  Credit Commitment, unless each of the Administrative Agent (except
                  with
                  respect to any assignment in respect of the Canadian Credit Facility)
                  and,
                  so long as no Event of Default has occurred and is continuing,
                  the
                  Borrowers otherwise consent (each such consent not to be unreasonably
                  withheld or delayed).

              

      

       

      (ii)           Proportionate
        Amounts.  Each partial assignment shall be made as an assignment
        of a proportionate part of all the assigning Lender’s rights and obligations
        under this Agreement with respect to the Loan or the Commitment
        assigned.

       

      (iii)          Required
        Consents.  No consent shall be required for any assignment except
        to the extent required by paragraph (b)(i)(B) of this §14.6 and, in
        addition:

       

      
        	
                 

              	
                (A)

              	
                the
                  consent of the Borrowers (such consent not to be unreasonably withheld
                  or
                  delayed) shall be required unless (x) Event of Default
                  has

              

      

       

      
        
          
          

        

        
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      occurred
        and is continuing at the time of such assignment or (y) such assignment is
        to a
        Lender, an Affiliate of a Lender or an Approved Fund;

       

      
        	
                 

              	
                (B)

              	
                the
                  consent of the Administrative Agent (such consent not to be unreasonably
                  withheld or delayed) shall be required for assignments in respect
                  of (i)
                  any unfunded portion of the Revolving Credit Facility if such assignment
                  is to a Person that is not a Lender with a Commitment in respect
                  of such
                  unfunded facility, an Affiliate of such Lender or an Approved Fund
                  with
                  respect to such Lender or (ii) a funded term facility to a Person
                  who is
                  not a Lender, an Affiliate of a Lender or an Approved Fund;
                  and

              

      

       

      
        	
                 

              	
                (C)

              	
                the
                  consent of the Issuing Bank (such consent not to be unreasonably
                  withheld
                  or delayed) shall be required for any assignment that increases
                  the
                  obligation of the assignee to participate in exposure under one
                  or more
                  Letters of Credit (whether or not then
                  outstanding).

              

      

       

      (iv)           Assignment
        and Assumption.  The parties to each assignment shall execute and
        deliver to the Administrative Agent an Assignment and Assumption, together
        with
        a processing and recordation fee of $3,500, and the assignee, if it is not
        a
        Lender, shall deliver to the Administrative Agent a questionnaire provided
        by
        the Administrative Agent.

       

      (v)           No
        Assignment to Borrower.  No such assignment shall be made to any
        of the Borrowers or any of the Borrowers’ Affiliates or
        Subsidiaries.

       

      (vi)           No
        Assignment to Natural Persons.  No such assignment shall be made
        to a natural person.

       

      (vii)           Canadian
        Lender.  Prior to the occurrence of an Event of Default, the
        Canadian Lender shall only be permitted to make such assignment to a Qualified
        Canadian Lender.

       

      Subject
        to acceptance and recording thereof by the Administrative Agent pursuant
        to
        paragraph (c) of this §14.6, from and after the effective date specified in each
        Assignment and Assumption, the assignee thereunder shall be a party to this
        Agreement and, to the extent of the interest assigned by such Assignment
        and
        Assumption, have the rights and obligations of a Lender under this Agreement,
        and the assigning Lender thereunder shall, to the extent of the interest
        assigned by such Assignment and Assumption, be released from its obligations
        under this Agreement (and, in the case of an Assignment and Assumption covering
        all of the assigning Lender’s rights and obligations under this Agreement, such
        Lender shall cease to be a party hereto) but shall continue to be entitled
        to
        the benefits of §§5.10, 5.14, 5.17 and 13.2 with respect to facts and
        circumstances occurring prior to the effective date of such
        assignment.  Any assignment or transfer by a Lender of rights or
        obligations under this Agreement that does not comply with this paragraph
        shall
        be treated for purposes of this Agreement as a sale by such Lender of a
        participation in such rights and obligations in accordance with paragraph
        (d) of
        this Section.

       

      (c)           Register.  The
        Administrative Agent, acting solely for this purpose as an agent of the
        Borrower, shall maintain at one of its offices in Boston, Massachusetts a
        copy
        of each Assignment and Assumption delivered to it and a register for the
        recordation of the names and addresses of the Lenders, and the Commitments
        of,
        and principal amounts of the Loans owing to, each Lender pursuant to the
        terms
        hereof from time to time (the “Register”).  The entries in the
        Register shall be conclusive, and the Borrowers, the Administrative Agent
        and
        the Lenders may treat each Person whose name is recorded in the Register
        pursuant to the terms hereof as a Lender hereunder for all purposes of this
        Agreement,

       

      
        
          
          

        

        
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      notwithstanding
        notice to the contrary.  The Register shall be available for
        inspection by the Borrowers and any Lender, at any reasonable time and from
        time
        to time upon reasonable prior notice.

       

      (d)           Participations.

       

      (i)           Any
        Lender may at any time, without the consent of, or notice to, the Borrowers
        or
        the Administrative Agent, sell participations to any Person (other than a
        natural person or any of the Borrowers or any of the Borrowers’ Affiliates or
        Subsidiaries) (each, a “Participant”) in all or a portion of such Lender’s
        rights and/or obligations under this Agreement (including all or a portion
        of
        its Commitment and/or the Loans owing to it); provided that (i) such Lender’s
        obligations under this Agreement shall remain unchanged, (ii) such Lender
        shall
        remain solely responsible to the other parties hereto for the performance
        of
        such obligations and (iii) the Borrower, the Administrative Agent, the Lenders
        and the Issuing Bank shall continue to deal solely and directly with such
        Lender
        in connection with such Lender’s rights and obligations under this
        Agreement.

       

      (ii)           Any
        agreement or instrument pursuant to which a Lender sells such a participation
        shall provide that such Lender shall retain the sole right to enforce this
        Agreement and to approve any amendment, modification or waiver of
        any  provision of this Agreement; provided that such agreement or
        instrument may provide that such Lender will not, without the consent of
        the
        Participant, agree to any amendment, modification or waiver with respect
        any
        actions set forth in §14.11 that the require the unanimous consent of the
        Lenders and that affects such Participant.  Subject to paragraph (e)
        of this §14.6, the Borrower agrees that each Participant shall be entitled to
        the benefits of §§5.9, 5.12 and 5.13 to the same extent as if it were a Lender
        and had acquired its interest by assignment pursuant to paragraph (b) of
        this
§§14.6.  To the extent permitted by law, each Participant also shall
        be entitled to the benefits of §14.1 as though it were a Lender, provided such
        Participant agrees to be subject to §§2.1.5 as though it were a
        Lender.

       

      (e)           Limitations
        upon Participant Rights.  A Participant shall not be entitled to
        receive any greater payment under Sections §§5.9, 5.12 and 5.13 than the
        applicable Lender would have been entitled to receive with respect to the
        participation sold to such Participant, unless the sale of the participation
        to
        such Participant is made with the Borrowers’ prior written consent.  A
        Participant that would be a Foreign Lender if it were a Lender shall not
        be
        entitled to the benefits of §5.13 unless the Borrowers are notified of the
        participation sold to such Participant and such Participant agrees, for the
        benefit of the Borrower, to comply with §5.13(e) as though it were a
        Lender.

       

      (f)           Certain
        Pledges.  Any Lender may at any time pledge or assign a security
        interest in all or any portion of its rights under this Agreement to secure
        obligations of such Lender, including any pledge or assignment to secure
        obligations to a Federal Reserve Bank; provided that no such pledge or
        assignment shall release such Lender from any of its obligations hereunder
        or
        substitute any such pledgee or assignee for such Lender as a party
        hereto.

       

      §
        14.7  Notices and Other Communications; Facsimile Copies.

       

      (a)           General.  Unless
        otherwise expressly provided herein, all notices and other communications
        provided for hereunder shall be in writing (including by facsimile
        transmission). All such written notices shall be mailed, faxed or delivered
        to
        the address, facsimile number or (subject to subsection (c) below) electronic
        mail address specified for notices to the applicable party on Schedule
        14.7; or to such other address, facsimile number or electronic mail address
        as shall be designated by such party in a notice to the other
        party.  All notices and other communications expressly permitted
        hereunder

       

      
        
          
          

        

        
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      to
        be
        given by telephone shall be made to the telephone number specified for notices
        to the applicable party on Schedule 14.7, or to such other telephone
        number as shall be designated by such party in a notice to the other
        party.  All such notices and other communications shall be deemed to
        be given or made upon the earlier to occur of (i) actual receipt by the relevant
        party hereto and (ii) (A) if delivered by hand or by courier, when signed
        for by
        or on behalf of the relevant party hereto; (B) if delivered by mail, four
        Business Days after deposit in the mails, postage prepaid; (C) if delivered
        by
        facsimile, when sent and receipt has been confirmed by telephone; and (D)
        if
        delivered by electronic mail (which form of delivery is subject to the
        provisions of subsection (c) below), when delivered; provided, however, that
        notices and other communications to the Administrative Agent pursuant to
§§2, 3,
        4 and 5 shall not be effective until actually received by the Administrative
        Agent.  In no event shall a voicemail message be effective as a
        notice, communication or confirmation hereunder.

       

      (b)           Effectiveness
        of Facsimile Documents and Signatures.  Loan Documents may be
        transmitted and/or signed by facsimile.  The effectiveness of any such
        documents and signatures shall, subject to applicable law, have the same
        force
        and effect as manually-signed originals and shall be binding on all Loan
        Parties
        and the Lender.  The Lender may also require that any such documents
        and signatures be confirmed by a manually-signed original thereof;
        provided, however, that the failure to request or deliver the same shall
        not
        limit the effectiveness of any facsimile document or signature.

       

      (c)           Reliance
        by Lender.  The Administrative Agent and the Lenders shall be
        entitled to rely and act upon any notices (including telephonic Loan Requests)
        purportedly given by or on behalf of any Borrower even if (i) such notices
        were
        not made in a manner specified herein, were incomplete or were not preceded
        or
        followed by any other form of notice specified herein, or (ii) the terms
        thereof, as understood by the recipient, varied from any confirmation
        thereof.  The Borrowers shall indemnify the Administrative Agent, the
        Lenders, their respective Affiliates, and their respective officers, directors,
        employees, agents and attorneys-in-fact from all losses, costs, expenses
        and
        liabilities resulting from the reliance by such Person on each notice
        purportedly given by or on behalf of any Borrower.  All telephonic
        notices to and other communications with the Lender may be recorded by the
        Lender, and the Borrowers hereby consent to such recording.

       

      §
        14.8  Cumulative Remedies; Captions; Counterparts. 

       

      The
        rights and remedies herein expressed are cumulative and not exclusive of
        any
        other rights which the Lender would otherwise have.  The captions in
        this Agreement are for convenience of reference only and shall not define
        or
        limit the provisions hereof.  This Agreement and any amendment hereof
        may be executed in several counterparts and by each party on a separate
        counterpart, each of which when so executed and delivered shall be an original,
        but all of which together shall constitute one instrument.  In proving
        this Agreement it shall not be necessary to produce or account for more than
        one
        such counterpart signed by the party against whom enforcement is
        sought.

       

      §
        14.9  USA Patriot Act Notice. 

       

      Each
        Lender that is subject to the Act (as hereinafter defined) and the
        Administrative Agent hereby notifies the Borrowers that, pursuant to the
        requirements of the USA PATRIOT Act (Title III of Pub. L. 107-56 (signed
        into
        law October 26, 2001)) (the “Act”), it is required to obtain, verify and record
        information that identifies the Borrowers, which information includes the
        names
        and addresses of the Borrowers and other information that will allow each
        of the
        Lenders and the Administrative Agent to identify the Borrowers in accordance
        with the Act.

       

      §
        14.10  Entire Agreement; Etc. 

       

      
        
          
          

        

        
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      The
        Loan
        Documents and any other documents executed in connection herewith or therewith
        express the entire understanding of the parties with respect to the transactions
        contemplated hereby.  Neither this Agreement nor any term hereof may
        be changed, waived, discharged or terminated, except as provided in
§14.11.

       

      §
        14.11  Consents; Amendments; Waivers; Etc. 

       

      No
        amendment or waiver of any provision of this Agreement or any other Loan
        Document, and no consent to any departure by the Borrowers therefrom, shall
        be
        effective unless in writing signed by the Required Lenders and the Borrowers,
        and acknowledged by the Administrative Agent, and each such waiver or consent
        shall be effective only in the specific instance and for the specific purpose
        for which given; provided, however, that no such amendment, waiver
        or consent shall:

       

      (a)           waive
        any condition set forth in §§6.1 and 6.2 without the written consent of each
        Lender;

       

      (b)           extend
        or increase the Commitment of any Lender (or reinstate any Commitment terminated
        pursuant to §§12.1 and 12.2) without the written consent of such
        Lender;

       

      (c)           postpone
        any date fixed by this Agreement or any other Loan Document for any payment
        or
        mandatory prepayment of principal, interest, fees or other amounts due to
        the
        Lenders (or any of them) hereunder or under any other Loan Document without
        the
        written consent of each Lender directly affected thereby;

       

      (d)           reduce
        the principal of, or the rate of interest specified herein on any Loan or
        Letter
        of Credit, or any fees or other amounts payable hereunder or under any other
        Loan Document without the written consent of each Lender directly affected
        thereby; provided, however, that only the consent of the Required Lenders
        shall
        be necessary (i) to amend the definition of “Default Rate” or to waive any
        obligation of the Borrowers to pay interest at the Default Rate or (ii) to
        amend
        any financial covenant hereunder (or any defined term used therein) even
        if the
        effect of such amendment would be to reduce the rate of interest on any Loan
        or
        to reduce any fee payable hereunder;

       

      (e)           release
        any Guarantor from its obligations under § 11.1 or release all or
        substantially all of the Pledged Equity, as applicable, without the consent
        of
        each Lender; or

       

      (f)           change
        any provision of this §14.11 or the definition of “Required Lenders” or any
        other provision hereof specifying the number or percentage of Lenders required
        to amend, waive or otherwise modify any rights hereunder or make any
        determination or grant any consent hereunder without the written consent
        of each
        Lender;

       

      and, provided 
        further, that (i) no amendment, waiver or consent shall, unless in
        writing and signed by the Issuing Bank in addition to the Lenders required
        above, affect the rights or duties of the Issuing Bank under this Agreement
        or
        any documents relating to any Letter of Credit issued or to be issued by
        it; and
        (ii) no amendment, waiver or consent shall, unless in writing and signed
        by the
        Administrative Agent in addition to the Lenders required above, affect the
        rights or duties of the Administrative Agent under this Agreement or any
        other
        Loan Document.  Notwithstanding anything to the contrary herein, no
        Defaulting Lender shall have any right to approve or disapprove any amendment,
        waiver or consent hereunder, except that the Commitment of such Lender may
        not
        be increased or extended without the consent of such Lender.

       

      §
        14.12  Concerning Joint and Several Liability. 

       

      
        
          
          

        

        
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      Notwithstanding
        anything herein to the contrary, in consideration of the financial
        accommodations to be provided by the Administrative Agent and the Lenders
        under
        this Agreement, for the mutual benefit, directly and indirectly, of each
        applicable Borrower and in consideration of the undertakings of the other
        applicable Borrowers to accept limited joint and several liability as set
        forth
        herein:

       

      (a)           Each
        U.S. Borrower, jointly and severally, hereby irrevocably and unconditionally
        accepts, not merely as a surety but also as a co-debtor, joint and several
        liability with the other U.S. Borrowers, Canadian Borrowers and Foreign
        Borrowers with respect to the payment and performance of all of the Obligations,
        it being the intention of the parties hereto that all of the Obligations
        shall
        be the joint and several obligations and liabilities of each U.S. Borrower
        without preferences or distinction among them.

       

      (b)           Each
        Canadian Borrower, jointly and severally, hereby irrevocably and unconditionally
        accepts, not merely as a surety but also as a co-debtor, joint and several
        liability with the other Canadian Borrowers with respect to the payment and
        performance of all of the Canadian Obligations, it being the intention of
        the
        parties hereto that all of the Canadian Obligations shall be the joint and
        several obligations of each Canadian Borrower without preferences or distinction
        among them.

       

      (c)           If
        and to the extent that any of the Borrowers shall fail to make any payment
        with
        respect to any of the applicable Obligations of such Borrower as and when
        due or
        to perform any such Obligations in accordance with the terms thereof, then
        in
        each such event all other U.S. Borrowers will make such payment with respect
        to,
        or perform, such Obligation, in accordance with the terms thereof.

       

      (d)           If
        and to the extent that any of the Canadian Borrowers shall fail to make any
        payment with respect to any of the Canadian Obligations as and when due or
        to
        perform any of the Canadian Obligations in accordance with the terms thereof,
        then in each such event the other Canadian Borrowers will make such payment
        with
        respect to, or perform, such Canadian Obligations, in accordance with the
        terms
        thereof.

       

      (e)           The
        respective Obligations of each applicable Borrower under the provisions of
        this
§14.12 constitute full recourse Obligations of each such Borrower enforceable
        against each such Borrower to the full extent of its properties and assets,
        irrespective of the validity, regularity or enforceability of this Agreement
        or
        any other circumstance whatsoever.

       

      (f)           Except
        as otherwise expressly provided in this Agreement, each Borrower, to the
        fullest
        extent permitted by applicable law, hereby waives notice of acceptance of
        its
        joint and several liability, as applicable, notice of any Loans made under
        this
        Agreement, notice of any action at any time taken or omitted by the
        Administrative Agent or the Lenders under or in respect of any of the
        Obligations, and, generally, to the extent permitted by applicable law, all
        demands, notices and other formalities of every kind in connection with this
        Agreement.  Each Borrower, to the fullest extent permitted by
        applicable law, hereby waives all defenses which may be available by virtue
        of
        any valuation, stay, moratorium law or other similar law now or hereafter
        in
        effect, any right to require the marshaling of assets of the Borrowers and
        any
        other Person primarily or secondarily liable with respect to any of the
        Obligations and all suretyship defenses generally.  Each Borrower, to
        the fullest extent permitted by applicable law, hereby assents to, and waives
        notice of, any extension or postponement of the time for the payment of any
        of
        the Obligations, the acceptance of any payment of any of the Obligations,
        the
        acceptance of any partial payment thereon, any waiver, consent or other action
        or acquiescence by the Lenders at any time or times in respect of any default
        by
        any of the Borrowers in the performance or satisfaction of any term, covenant,
        condition or provision of this Agreement, any and all other indulgences
        whatsoever by the Lenders in respect of any of the Obligations, and the taking,
        addition, substitution or release, in whole or in part, at

       

      
        
          
          

        

        
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      any
        time
        or times, of any security for any of the Obligations or the addition,
        substitution or release, in whole or in part, of any of the
        Borrowers.  Without limiting the generality of the foregoing, each
        Borrower assents to any other action or delay in acting or failure to act
        on the
        part of the Lenders with respect to the failure by any of the Borrowers to
        comply with any of its respective Obligations, including, without limitation,
        any failure strictly or diligently to assert any right or to pursue any remedy
        or to comply fully with applicable laws or regulations thereunder, which
        might,
        but for the provisions of this  Section 14.12, afford grounds for
        terminating, discharging or relieving any of the Borrowers, in whole or in
        part,
        from any of its Obligations under this Section 14.12, it being the intention
        of
        each Borrower that, so long as any of the Obligations hereunder remain
        unsatisfied, the Obligations of such Borrowers under this Section 14.12 shall
        not be discharged except by performance and then only to the extent of such
        performance.  The Obligations of each Borrower under this Section
        14.12 shall not be diminished or rendered unenforceable by any winding up,
        reorganization, arrangement, liquidation, re-construction or similar proceeding
        with respect to any of the Borrowers, the Administrative Agent or the
        Lenders.  The joint and several liability of the Borrowers hereunder
        shall continue in full force and effect notwithstanding any absorption, merger,
        amalgamation or any other change whatsoever in the name, membership,
        constitution or place of formation of any of the Borrowers, the Administrative
        Agent, the Canadian Lender or the Lenders.

       

      (g)           To
        the extent any Borrower makes a payment hereunder in excess of the aggregate
        amount of the benefit received by such Borrower in respect of the extensions
        of
        credit under the Agreement (the “Benefit Amount”), then such Borrower,
        after the payment in full, in cash, of all of the Obligations, shall be entitled
        to recover from each other applicable Borrower such excess payment, pro rata,
        in
        accordance with the ratio of the Benefit Amount received by each such other
        Borrower to the total Benefit Amount received by all applicable Borrowers,
        and
        the right to such recovery shall be deemed to be an asset and property of
        such
        Borrower so funding; provided, that each Borrower hereby agrees that it will
        not
        enforce any of its rights of contribution or subrogation against the other
        Borrowers with respect to any liability incurred by it hereunder or under
        any of
        the other Loan Documents, any payments made by it to any of the Lenders or
        the
        Administrative Agent with respect to any of the Obligations or any collateral
        security therefor until such time as all of the Obligations have been
        irrevocably paid in full in cash, the Commitments have terminated and no
        Letters
        of Credit shall be outstanding (or have been backstopped or cash collateralized
        on terms reasonably acceptable to the Administrative Agent).  Any
        claim which any Borrower may have against any other Borrower with respect
        to any
        payments to the Lenders or the Administrative Agent hereunder or under any
        other
        Loan Document are hereby expressly made subordinate and junior in right of
        payment, without limitation as to any increases in the Obligations arising
        hereunder or thereunder, to the prior payment in full of the Obligations
        and, in
        the event of any insolvency, bankruptcy, receivership, liquidation,
        reorganization or other similar proceeding under the laws of any jurisdiction
        relating to any Borrower, its debts or its assets, whether voluntary or
        involuntary, all such Obligations shall be paid in full before any payment
        or
        distribution of any character, whether in cash, securities or other property,
        shall be made to any other Borrower therefor.

       

      (h)           Each
        Borrower hereby agrees that the payment of any amounts due with respect to
        the
        Indebtedness owing by any Borrower to any other Borrower is hereby subordinated
        to the prior payment in full in cash of the Obligations.  Each
        Borrower hereby agrees that after the occurrence and during the continuance
        of
        any Event of Default, such Borrower will not demand, sue for or otherwise
        attempt to collect any such Indebtedness of any other Borrower owing to such
        Borrower until the Obligations shall have been paid in full in cash, the
        Commitments have terminated and no Letters of Credit shall be outstanding
        (or
        have been backstopped or cash collateralized on terms reasonably acceptable
        to
        the Administrative Agent).  If, notwithstanding the foregoing
        sentence, such Borrower shall collect, enforce or receive any amounts in
        respect
        of such Indebtedness before payment in full in cash of the Obligations, such
        amounts shall be collected, enforced, received by such Borrower as trustee
        for
        the Administrative Agent and be paid over to the Administrative Agent for
        the
        pro rata accounts of the Lenders to be applied

       

      
        
          
          

        

        
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      to
        repay
        (or be held as security for the repayment of) the Obligations, provided that
        nothing in this section shall be effective to create a registrable
        charge.

       

      (i)           The
        provisions of this § 14.12 are made for the benefit of the Administrative
        Agent and the Lenders and their successors and assigns, and may be enforced
        in
        good faith by them from time to time against any or all of the Borrowers
        as
        often as the occasion therefor may arise and without requirement on the part
        of
        the Administrative Agent or the Lenders first to marshal any of their claims
        or
        to exercise any of their rights against any other Borrower or to exhaust
        any
        remedies available to them against any other Borrower or to resort to any
        other
        source or means of obtaining payment of any of the Obligations hereunder
        or to
        elect any other remedy.  The provisions of this Section 14.12 shall
        remain in effect until all of the Obligations shall have been paid in full
        in
        cash or otherwise fully satisfied, the Commitments have terminated and no
        Letters of Credit shall be outstanding (or have been backstopped or cash
        collateralized on terms reasonably acceptable to the Administrative
        Agent).  If at any time, any payment, or any part thereof, made in
        respect of any of the Obligations, is rescinded or must otherwise be restored
        or
        returned by the Administrative Agent or the Lenders upon the insolvency,
        bankruptcy or reorganization of any of the Borrowers or is repaid in good
        faith
        settlement of a pending or threatened avoidance claim, or otherwise, the
        provisions of this Section 14.12 will forthwith be reinstated in effect,
        as
        though such payment had not been made.

       

      (j)           It
        is the intention and agreement of each of the Borrowers and the Lenders that
        the
        obligations of such Borrower under this Agreement shall be valid and enforceable
        against such Borrower to the maximum extent permitted by applicable
        law.  Accordingly, if any provision of this Agreement creating any
        obligation of a Borrower in favor of the Lenders shall be declared to be
        invalid
        or unenforceable in any respect or to any extent, it is the stated intention
        and
        agreement of such Borrower and the Lenders that any balance of the obligation
        created by such provision and all other obligations of the Borrower to the
        Lenders created by other provisions of this Agreement shall remain valid
        and
        enforceable.  Likewise, if by final order a court of competent
        jurisdiction shall declare any sums which the Lenders may be otherwise entitled
        to collect from any Borrower under this Agreement to be in excess of those
        permitted under any law (including any federal or state fraudulent conveyance
        or
        like statute or rule of law) applicable to such Borrower’s obligations under
        this Agreement, it is the stated intention and agreement of the Borrower
        and the
        Lenders that all sums not in excess of those permitted under such applicable
        law
        shall remain fully collectible by the Lenders from such Borrower.

       

      (k)           Notwithstanding
        anything in this Agreement or any other Loan Document to the contrary, in
        no
        event or circumstance shall (i) any Canadian Borrower or Canadian Guarantor
        be
        liable or obligated in any way as a guarantor, surety or otherwise for the
        payment or performance of any of the Obligations of any U.S. Borrower or
        Foreign
        Borrower (the obligations of the Canadian Borrowers and any Canadian Guarantor
        under the Loan Documents being limited to the payment of the Canadian Revolving
        Credit Loans, the Term Loans, all applicable L/C Obligations in respect of
        any
        Canadian Letter of Credit, any Swap Contract or Bank Product Obligations
        entered
        into by any Canadian Borrower and all related obligations in respect thereof
        included in the definition of Canadian Obligations and Canadian Revolving
        Credit
        Obligations) or (ii) any Foreign Borrower be liable or obligated in any way
        as a
        guarantor, surety or otherwise for the payment or performance of any of the
        Obligations of any U.S. Borrower, Canadian Borrower or any other Foreign
        Borrower (the obligations of such Foreign Borrower under the Loan Documents
        being limited to the payment of the Revolving Credit Loans borrowed by such
        Foreign Borrower, any Swap Contract or Bank Product Obligations entered into
        by
        such Foreign Borrower and all related obligations in respect thereof (in
        the
        nature of interest, fees, costs and expenses in relation to the foregoing)
        included in the definition of Obligations.

       

      §
        14.13  Governing Law. 

       

      
        
          
          

        

        
          -82-

          
            

          

        

        
          
          

        

      

      THIS
        AGREEMENT AND EACH OF THE OTHER LOAN DOCUMENTS (EXCEPT AS EXPRESSLY SET FORTH
        THEREIN) ARE CONTRACTS UNDER AND SHALL FOR ALL PURPOSES BE CONSTRUED IN
        ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE COMMONWEALTH OF MASSACHUSETTS
        (EXCLUDING THE LAWS APPLICABLE TO CONFLICTS OR CHOICE OF LAW).  THE
        BORROWERS CONSENT TO THE JURISDICTION OF ANY OF THE STATE OR FEDERAL OR COURTS
        LOCATED IN THE COMMONWEALTH OF MASSACHUSETTS IN CONNECTION WITH ANY SUIT
        TO
        ENFORCE THE RIGHTS OF THE LENDERS UNDER THIS AGREEMENT OR ANY OF THE OTHER
        LOAN
        DOCUMENTS.

       

      §
        14.14  Waiver of Jury Trial. 

       

      EACH
        PARTY HERETO HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE
        LAW,
        ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY
        OR
        INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT, ANY OTHER LOAN DOCUMENT
        OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY (WHETHER BASED ON CONTRACT,
        TORT OR ANY OTHER THEORY).  EACH PARTY HERETO (A) CERTIFIES THAT NO
        REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY
        OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION,
        SEEK
        TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER
        PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER
        THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION

       

      §
        14.15Severability. 

       

      The
        provisions of this Agreement are severable and if any one clause or provision
        hereof shall be held invalid or unenforceable in whole or in part in any
        jurisdiction, then such invalidity or unenforceability shall affect only
        such
        clause or provision, or part thereof, in such jurisdiction, and shall not
        in any
        manner affect such clause or provision in any other jurisdiction, or any
        other
        clause or provision of this Agreement in any jurisdiction.

       

      The
        parties confirm their express wish that this Agreement and all documents
        including notices, relating thereto be drawn up in English.  Les
        parties confirment avoir requis que cette convention ainsi que tous les
        documents et avis s’y rattachant soient rédigés en anglais.

       

      

       

      
        
          
          

        

        
          -83-

          
            

          

        

        
          
          

        

      

      IN
        WITNESS WHEREOF, the parties hereto
        have caused this Agreement to be

      duly
        executed and delivery as of the day and year first above written.

      

      
        	 	 
	 	
                BORROWER:

              
	 	 
	 	
                LOJACK
                  CORPORATION

              
	 	 
	 	 
	 	
                By:
                  /s/ Richard T. Riley

              
	 	
                Name:  Richard
                  T. Riley

              
	 	
                Title:  CEO

              

      

      
        
                

                    

          

          Signature
            Page to Credit Agreement 

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

      
        	 	 
	 	
                CANADIAN
                  BORROWER:

              
	 	 
	 	
                LOJACK
                  EXCHANGEGO CANADA INC.

              
	 	 
	 	 
	 	
                By:
                  /s/ Richard T. Riley

              
	 	
                Name:  Richard
                  T. Riley

              
	 	
                Title:  CEO

              

      

      

      

      

      
        
          Signature
            Page to Credit Agreement 

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

      
        	 	 
	 	
                U.S.
                  GUARANTORS:

              
	 	 
	 	
                LOJACK
                  INTERNATIONAL CORPORATION

              
	 	 
	 	 
	 	
                By:
                  /s/ Richard T. Riley

              
	 	
                Name:  Richard
                  T. Riley

              
	 	
                Title:  Vice
                  President

              
	 	 
	 	 

      

      
        
          Signature
            Page to Credit Agreement 

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

      
        	 	
                LOJACK
                  GLOBAL LLC

              
	 	 
	 	 
	 	
                By:
                  /s/ Richard T. Riley

              
	 	
                Name:  Richard
                  T. Riley

              
	 	
                Title:  President

              
	 	 

      

      
        
          Signature
            Page to Credit Agreement 

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

      
        	 	
                LOJACK
                  OPERATING COMPANY, L.P.

              
	 	 
	 	 
	 	
                By:
                  /s/ Richard T. Riley

              
	 	
                Name:  Richard
                  T. Riley

              
	 	
                Title:  President

              
	 	 

      

      
        
          Signature
            Page to Credit Agreement 

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

      
        	 	
                CANADIAN
                  GUARANTORS

              
	 	 
	 	
                6292887
                  CANADA INC.

              
	 	 
	 	 
	 	
                By:
                  /s/ Richard T. Riley

              
	 	
                Name:  Richard
                  T. Riley

              
	 	
                Title:  CEO

              
	 	 
	 	 

      

      
        
          Signature
            Page to Credit Agreement 

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

      
        	 	
                BOOMERANG
                  TRACKING INC.

              
	 	 
	 	 
	 	
                By:
                  /s/ Richard T. Riley

              
	 	
                Name:  Richard
                  T. Riley

              
	 	
                Title:  CEO

              
	 	 
	 	 

      

      
        
          Signature
            Page to Credit Agreement 

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

      
        	 	
                CITIZENS
                  BANK OF MASSACHUSETTS,

              
	 	
                as
                  Lender, Issuing Bank and Administrative Agent

              
	 	 
	 	 
	 	
                By:
                  /s/ David J. Bugbee

              
	 	
                Name:  David
                  J. Bugbee

              
	 	
                Title:  Vice
                  President

              
	 	 
	 	 

      

      
        
          Signature
            Page to Credit Agreement 

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

      
        	 	
                JPMorgan
                  Chase Bank, N.A.

              
	 	 
	 	 
	 	
                By:
                  /s/ Peter M. Killea

              
	 	
                Name:  Peter
                  M. Killea

              
	 	
                Title:  Vice
                  President

              
	 	 
	 	 

      

      
        
          Signature
            Page to Credit Agreement 

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

      
        	 	
                ROYAL
                  BANK OF CANADA, acting through a 

                New
                  York branch, as Revolving Credit Lender

              
	 	 
	 	 
	 	
                By:
                  /s/ Dustin Craven

              
	 	
                Name:  Dustin
                  Craven

              
	 	
                Title:  Attorney-in-Fact

              
	 	 
	 	 

      

      
        
          Signature
            Page to Credit Agreement 

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

      
        	 	
                SOVEREIGN
                  BANK

              
	 	 
	 	 
	 	
                By:
                  /s/ Tony Zhang

              
	 	
                Name:  Tony
                  Zhang

              
	 	
                Title:  Sr.
                  Vice President

              
	 	 

      

      
        
          Signature
            Page to Credit Agreement 

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

      
        	 	
                JPMORGAN
                  CHASE BANK, N.A., TORONTO BRANCH

              
	 	 
	 	 
	 	
                By:
                  /s/ Michael N. Tam

              
	 	
                Name:  Michael
                  N. Tam

              
	 	
                Title:  Senior
                  Vice President

              
	 	 
	 	
                 

              
	 	
                 

              
	 	 
	 	 

      

      
        
          Signature
            Page to Credit Agreement 

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

      
        	 	 
                
                ROYAL
                  BANK OF CANADA, as Term Loan

              
	 	 Lender
                and Canadian Lender
	 	 
	 	
                By:
                  /s/ Amy S. Promaine

              
	 	
                Name:  Amy
                  S. Promaine

              
	 	
                Title:  Authorized
                  Signatory

              
	 	 

      

      

      

      

      

      

      

      

      Signature
        Page to Credit Agreement

    

    
       

       

       

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

        SCHEDULE
          1

         

        SUBSIDIARIES
          AND AFFILIATES

         

        

        U.S.
          Borrowers:

         

        LoJack
          Corporation

         

        

         

        Canadian
          Revolving Borrowers:

         

        LoJack
          Exchangeco Canada Inc.

         

        

         

        Term
          Loan Borrower:

         

        LoJack
          Exchangeco Canada Inc.

         

        

         

        Foreign
          Borrowers:

         

        None

         

        

         

        U.S.
          Guarantors:

         

        
          	
                  1.

                	
                  LoJack
                    Corporation

                

        

         

        
          	
                  2.

                	
                  LoJack
                    Global LLC

                

        

         

        
          	
                  3.

                	
                  LoJack
                    International Corporation

                

        

         

        
          	
                  4.

                	
                  LoJack
                    Operating Company, L.P.

                

        

         

        

         

        Canadian
          Guarantors:

         

        
          	
                  1.

                	
                  6292887
                    Canada Inc.

                

        

         

        
          	
                  2.

                	
                  Boomerang
                    Tracking Inc.

                

        

         

        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

        SCHEDULE
          2

         

        LENDERS,
          COMMITMENTS, APPLICABLE PERCENTAGES

        

        

        

        

        

        

        LENDERS

        

        Revolving
          Credit Lenders:

        

        Citizens
          Bank of Massachusetts

        JP
          Morgan
          Chase Bank, N.A.

        Royal
          Bank of Canada, acting through a New York branch

        Sovereign
          Bank

        

        Term
          Loan Lenders:

        

        Citizens
          Bank of Massachusetts

        JP
          Morgan
          Chase Bank, N.A., Toronto Branch

        Royal
          Bank of Canada

        Sovereign
          Bank

        

        Canadian
          Lender:

        

        Royal
          Bank of Canada

        

        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

        COMMITMENTS;
          APPLICABLE PERCENTAGES

        

        

         

          

          
            	 	
                    REVOLVING
                      CREDIT FACILITY

                  
	
                     

                    Lender

                  	
                     

                    Commitment

                  	
                     

                    Applicable
                      Percentage

                  
	 	 	 
	
                    Citizens
                      Bank of Massachusetts

                  	
                    $23,333,333.33

                  	
                    46.67%

                  
	
                    JPMorgan
                      Chase Bank, N.A.

                  	
                    $13,333,333.33

                  	
                    26.67%

                  
	
                    Royal
                      Bank of Canada, acting through a New York Branch

                  	
                    $10,000,000.00

                  	
                    20.00%

                  
	
                    Sovereign
                      Bank

                  	
                    $3,333,333.34

                  	
                    6.67%

                  
	
                    TOTAL

                  	
                    $50,000,000.00

                  	
                    100.00%

                  

          

          

          

          

          
            	 	
                    THE
                      TERM LOAN

                  
	
                     

                    Lender

                  	
                     

                    Term
                      Loan Amount

                  	
                     

                    Applicable
                      Percentage

                  
	 	 	 
	
                    Citizens
                      Bank of Massachusetts

                  	
                    Can.
                      $12,133,333.33

                  	
                    46.67%

                  
	
                    JPMorgan
                      Chase Bank, N.A., Toronto Branch

                  	
                    Can.
                      $6,933,333.33

                  	
                    26.67%

                  
	
                    Royal
                      Bank of Canada

                  	
                    Can.
                      $5,200,000.00

                  	
                    20.00%

                  
	
                    Sovereign
                      Bank

                  	
                    Can.
                      $1,733,333.34

                  	
                    6.67%

                  
	
                    TOTAL

                  	
                    Can.
                      $26,000,000.00

                  	
                    100.00%

                  

          

          

          

          
            	 	
                    CANADIAN
                      CREDIT FACILITY

                  
	
                     

                    Lender

                  	
                     

                    Commitment

                  	
                     

                    Applicable
                      Percentage

                  
	 	 	 
	
                    Royal
                      Bank of Canada

                  	
                    Can.
                      $5,000,000.00

                  	
                    100.00%

                  
	
                    TOTAL

                  	
                    Can.,
                      $5,000,000.00

                  	
                    100.00%

                  

          

          
            
              
              

            

            
              
              

              
                

              

            

            
              
              

            

          

        

        

        

         

        

        

        SCHEDULE
          3

         

        LENDING
          OFFICES

         

        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

        

         

        SCHEDULE
          3.1-A

         

        ADDITIONAL
          DEFINITIONS FOR CANADIAN CREDIT FACILITY

         

        For
          the
          purpose of the Canadian Credit Facility, the following terms and phrases
          shall
          have the following meanings (it being understood that capitalized terms
          not
          otherwise defined in this Schedule 3.1-A shall have the meanings assigned
          to such terms in § 1.1 or § 3 of the Credit Agreement, as
          applicable):

         

        Acceptance
          Fee.  Means the fee payable at the time of the acceptance of
          Bankers' Acceptances established by multiplying the face amount of such
          Bankers'
          Acceptances by the Applicable Margin and by multiplying the product so
          obtained
          by a fraction having a numerator equal to the number of days in the term
          of such
          Bankers' Acceptances and a denominator of 365.

         

        Bankers’
          Acceptance or BA.  Means a bill of exchange denominated in
          Canadian Dollars, including a depository bill issued in accordance with
          the
Depository Bills and Notes Act (Canada), drawn on the Canadian Lender
          by, and payable to the order of, any Canadian Revolving Borrower which
          have been
          accepted by the Canadian Lender.

         

        Banking
          Day.  Means a Business Day on which dealings in US Dollar deposits
          may be carried on by and between banks in the London interbank eurodollar
          market.

         

        Business
          Day.  Means a day, excluding Saturday, Sunday and any other day
          which is a legal holiday, on which banking institutions are open for normal
          business in Montreal and Toronto and, in respect of any payments in US
          Dollars,
          a day on which banking institutions are also open for business in New York,
          N.Y., U.S.A. and furthermore, in respect of a Libor Loan, means a day which
          is
          also a Banking Day.

         

        Canadian
          Lender CDOR Rate.  Means, on any day, the rate per annum which is
          the rate determined by the Canadian Lender as being the arithmetic average
          (rounded to the nearest one-thousandth of 1%, with five ten-thousandths
          of 1%
          being rounded upwards) of the rates applicable to Canadian Dollar bankers’
acceptances for the appropriate term displayed and identified on the “Reuters
          Screen CDOR Page” (as defined in the International Swaps and Derivatives
          Association, Inc. definitions, as modified and amended from time to time)
          at
          approximately 10:00 a.m. on such day, or if such day is not a Business
          Day then
          on the immediately preceding Business Day (as adjusted by the Canadian
          Lender
          after 10:00 a.m. to reflect any error in a posted rate of interest or in
          the
          posted average annual rate of interest); provided, however, if such rates
          do not appear on the Reuters Screen CDOR Page as contemplated, then the
          Canadian
          Lender CDOR Rate on any day shall be the discount rate applicable to Canadian
          Dollar bankers’ acceptances for the appropriate term of the Canadian Lender at
          approximately 10:00 a.m. on such day, or if such day is not a Business Day,
          then on the immediately preceding Business Day.

         

        Discount.  Means
          with respect to any issue of Bankers' Acceptances with the same maturity
          date,
          the amount by which the face value of such Bankers' Acceptances exceeds
          the
          Discounted Proceeds of such Bankers' Acceptances.

         

        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

        Discounted
          Proceeds.  Means, in respect of any Bankers' Acceptance to be
          accepted by the Canadian Lender on any day, an amount calculated on the
          date of
          issue thereof which is (rounded to the nearest whole cent, and with one-half
          of
          one cent being rounded up) calculated on such day by multiplying:

         

        (a)           the
          face amount of such Bankers' Acceptance, by

         

        (b)           the
          price, where the price is determined by dividing one by the sum of one
          plus the
          product of:

         

        
          	
                   

                	
                  (i)

                	
                  the
                    Discount Rate (expressed as a
                    decimal);  and

                

        

         

        
          	
                   

                	
                  (ii)

                	
                  a
                    fraction, the numerator of which is the number of days in the
                    term of such
                    Bankers' Acceptance and the denominator of which is
                    365;

                

        

         

        with
          the
          price as so determined being rounded up or down to the fifth decimal place
          and
          .000005 being rounded up.

         

        Discount
          Rate.  Means, with respect to an issue of Bankers' Acceptances
          with the same maturity date, the rate determined by the Canadian Lender
          as being
          the discount rate, calculated on the basis of a year of 365 days, of the
          Canadian Lender established in accordance with its normal practice at or
          about
          9:30 a.m. on the date of issue and acceptance of such Bankers' Acceptances,
          for
          bankers' acceptances accepted by the Canadian Lender and having a comparable
          face value and an identical maturity date to the face value and maturity
          date of
          the Bankers' Acceptances forming part of such issue of Bankers'
          Acceptances.

         

        Equivalent
          Amount.  Means the amount of Dollars into which Canadian Dollars
          may be converted or the amount of Canadian Dollars into which Dollars may
          be
          converted using the Bank of Canada's noon mid-point spot rate for such
          currencies on such date.

         

        Eurocurrency.  Means
          US Dollars, Sterling, Deutsche Marks, Swiss Francs, Japanese Yen or any
          other
          currency which is freely convertible on the London Interbank
          Market.

         

        LC.  Means
          a documentary credit issued by the Canadian Lender on behalf of any Canadian
          Revolving Borrower for the purpose of paying suppliers of goods.

         

        Letter
          of Credit.  Means, in connection with the Canadian Credit
          Facility, a LC or a LG.

         

        LG.  Means
          a documentary credit issued by the Canadian Lender on behalf of any Canadian
          Revolving Borrower for the purpose of providing security to a third party
          that
          such Canadian Revolving Borrower or a person designated by such Canadian
          Revolving Borrower will perform a contractual obligation owed to such third
          party.

         

        Libor.  Means,
          with respect to each Libor Interest Period applicable to a Libor Loan,
          the
          annual rate of interest (rounded upwards, if necessary, to the nearest
          whole
          multiple of one sixteenth of one percent (1/16th%)), at which the Canadian
          Lender, in accordance with its normal practice, would be prepared to offer
          deposits to leading banks in the London Interbank Market for delivery on
          the
          first day of each such Libor Interest Period, for a period equal to
          each

         

        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

        such
          Libor Interest Period, such deposits being in Dollars (or other agreed
          upon
          Eurocurrency specified herein) of comparable amounts to be outstanding
          during
          such Libor Interest Period, at or about 10:00 a.m. (Toronto time) on the
          Interest Determination Date.

         

        Libor
          Interest Date.  Means, with respect to any Libor Loan, the last
          day of each Libor Interest Period and, if the relevant Canadian Revolving
          Borrower selects a Libor Interest Period for a period longer than 3 months,
          the
          Libor Interest Date shall be the date falling every 3 months after the
          beginning
          of such Libor Interest Period as well as the last day of such Libor Interest
          Period.

         

        Libor
          Interest Period.  Means, with respect to any Libor Loan, the
          initial period (subject to availability) of approximately 1 month (or longer
          whole multiples of 1 month to and including 6 months as selected by the
          relevant
          Canadian Revolving Borrower and notified to the Canadian Lender by written
          notice) or such shorter or longer period as the Canadian Lender in its
          sole
          discretion shall make available commencing on the date on which such Libor
          Loan
          is made or another method of Borrowing is converted to a Libor Loan, as
          the case
          may be, and thereafter, while such Libor Loan is outstanding, each successive
          period (subject to availability) of 1 month (or longer whole multiples
          of 1
          month to and including 6 months, as selected by the relevant Canadian Revolving
          Borrower and notified to the Canadian Lender by written notice) commencing
          on
          the last day of the immediately preceding Libor Interest Period.

         

        RBP
          and Royal Bank Prime.  In effect on any day, means the higher of
          (a) the annual rate of interest announced by the Canadian Lender from time
          to time as its “prime rate”, being its reference rate then in effect for
          determining interest rates on commercial loans made by it in Canadian Dollars
          in
          Canada and (b) the annual rate of interest equal to the Canadian Lender
          CDOR Rate, plus 1% per annum, in each case as adjusted from time to time
          without
          notice to the Canadian Revolving Borrowers.

         

        RBUSBR
          and Royal Bank US Base Rate.  In effect on any day, means the rate
          of interest per annum that is the greater of (a) the rate of interest publicly
          announced by the Canadian Lender from time to time as its "US Base Rate",
          being
          its reference rate then in effect for determining interest rates on commercial
          loans in US Dollars made by it in Canada, and (b) the annual rate of interest
          equal to the sum of the daily Federal Funds Effective Rate (converted to
          a rate
          based on, as the case may be, a 365 or 366-day period) then in effect
plus 1 % per annum, in each case, as adjusted from time to time
          without notice to the Canadian Revolving Borrowers.

         

        

         

        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

        Schedule
          3.1-B

         

        Borrowing
          Conditions Under Canadian Credit Facility

         

        Borrowings
          made other than by way of RBP Loans or RBUSBR Loans will be subject to
          the
          following terms and conditions:

         

        BAs:

         

        
          	
                   

                	
                  (a)

                	
                  The
                    Canadian Revolving Borrowers may effect Canadian Revolving Credit
                    Loans by
                    way of Bankers' Acceptances denominated in Canadian Dollars in
                    accordance
                    with the provisions hereinbelow.  For the purposes of this
                    Agreement, the full face value of Bankers' Acceptances, without
                    Discount,
                    shall be used when calculations are made to determine the amount
                    of
                    Canadian Revolving Credit Loans.  Each determination by the
                    Canadian Lender of the Acceptance Fee, of the Discount Rate,
                    of the
                    Discounted Proceeds and of the Discount shall, in the absence
                    of manifest
                    error be final, conclusive and binding on the Canadian Revolving
                    Borrowers;

                

        

         

        
          	
                   

                	
                  (b)

                	
                  the
                    relevant Canadian Revolving Borrower shall give to the Canadian
                    Lender an
                    irrevocable telephone notice at least by 10:30 a.m. two (2) Business
                    Days prior to any Borrowing by way of a BA (including renewal
                    or
                    conversion thereof) followed by a written confirmation substantially
                    in
                    the form of Exhibit C to the Credit
                    Agreement;

                

        

         

        
          	
                   

                	
                  (c)

                	
                  BAs
                    shall be issued and mature on a Business Day and shall be issued
                    in
                    minimum face amounts of $100,000 or such larger amount as is
                    a whole
                    multiple of $100,000 for terms of not less than 30 and not more
                    than 180
                    days;

                

        

         

        
          	
                   

                	
                  (d)

                	
                  upon
                    each issue of Bankers' Acceptances:

                

        

         

        
          	
                   

                	
                  (i)

                	
                  which
                    are purchased by the Canadian Lender for its own account, the
                    relevant
                    Canadian Revolving Borrower shall be entitled to be credited
                    by the
                    Canadian Lender with the Discounted Proceeds thereof, less the
                    Acceptance
                    Fee,

                

        

         

        
          	
                   

                	
                  (ii)

                	
                  as
                    a result of the conversion of out­standing Canadian Revolving Credit
                    Loans into Bankers' Acceptances or as a result of the renewal
                    of
                    outstanding Bankers' Acceptances, the relevant Canadian Revolving
                    Borrower
                    shall, concurrently with the conversion or renewal, pay in advance
                    out of
                    its own funds to the Canadian Lender an amount equal to the Discount
                    applicable to such issue, to be applied against the principal
                    of the
                    Canadian Revolving Credit Loan being so converted or renewed,
                    plus the
                    applicable Acceptance Fee.

                

        

         

        
          	
                   

                	
                  (e)

                	
                  notwithstanding
                    any other provision of this Agreement, the Canadian Revolving
                    Borrowers
                    shall indemnify the Canadian Lender against any loss, cost or
                    expense

                

        

         

        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

        incurred
          by the Canadian Lender if any BA is repaid, prepaid, converted or cancelled
          other than on the maturity date of such BA;

         

        
          	
                   

                	
                  (f)

                	
                  any
                    BA issued hereunder must have a maturity on or before the Maturity
                    Date,
                    unless otherwise agreed by the Canadian
                    Lender;

                

        

         

        
          	
                   

                	
                  (g)

                	
                  prior
                    to the issue of any BA the Canadian Revolving Borrowers shall
                    execute the
                    Canadian Lender’s standard form of undertaking and agreement in respect of
                    BAs.  If there is any inconsistency at any time between the
                    terms of this Agreement and the terms of the Canadian Lender’s standard
                    form of undertaking and agreement, the terms of this Agreement
                    shall
                    govern;

                

        

         

        
          	
                   

                	
                  (h)

                	
                  if
                    Bankers' Acceptances are outstanding hereunder, the relevant
                    Canadian
                    Revolving Borrower shall prior to the date of maturity of the
                    then current
                    Bankers' Acceptances, irrevo­cably notify the Canadian Lender of the
                    intention of such Canadian Revolving Borrower to repay, renew
                    or convert
                    such Canadian Revolving Credit Loan at the maturity of the related
                    Bankers' Acceptances, such notice to be given by telephone within
                    notice
                    periods similar to those provided in paragraph (b) above, followed by
                    a written confirmation substantially in the form of Exhibit C to
                    the Credit Agreement on the same
                    day;

                

        

         

        
          	
                   

                	
                  (i)

                	
                  if
                    the relevant Canadian Revolving Borrower shall choose to renew
                    a Canadian
                    Revolving Credit Loan outstanding by way of Bankers' Acceptances
                    in the
                    same form of Canadian Revolving Credit Loan, such Canadian Revolving
                    Borrower shall cause the term of the new Bankers' Acceptances
                    to commence
                    on and include the date of maturity of the relative Bankers'
                    Acceptances
                    being renewed.  If such Canadian Revolving Borrower fails to so
                    notify the Canadian Lender as provided in paragraph (h) above, such
                    Canadian Revolving Borrower shall be deemed to have notified
                    the Canadian
                    Lender of its intention to convert the relevant Canadian Revolving
                    Credit
                    Loan by way of Bankers' Acceptances into a RBP
                    Loan;

                

        

         

        
          	
                   

                	
                  (j)

                	
                  the
                    relevant Canadian Revolving Borrower shall, by no later than
                    10:30 a.m. on
                    the maturity date of each Bankers' Acceptance, pay to the Canadian
                    Lender
                    an amount equal to the face amount of all Bankers' Acceptances
                    accepted by
                    the Canadian Lender and maturing on that day by effecting such
                    payment out
                    of its own funds to the Canadian Lender, or by converting such
                    Canadian
                    Revolving Credit Loan by way of Bankers' Acceptances into another
                    form of
                    Canadian Revolving Credit Loan then available hereunder or by
                    renewing
                    such Bankers' Acceptances hereunder, the whole subject to the
                    payment of
                    the Discount as provided in paragraph (d)(ii) above, and in each case
                    of conversion or renewal, the Discounted Proceeds, together with
                    the
                    Discount paid to the Canadian Lender in respect thereof, shall
                    be applied
                    by the Canadian Lender to the reduction of the Canadian Revolving
                    Credit
                    Loan being converted or renewed, as the case may
                    be;

                

        

         

        
          	
                   

                	
                  (k)

                	
                  in
                    the event that the relevant Canadian Revolving Borrower fails
                    to provide
                    payment of the face amount of a Bankers' Acceptance on its maturity
                    date
                    as

                

        

         

        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

        required
          pursuant to paragraph (j) above, then the Canadian Dollar amount of such
          failed payment shall be deemed for all purposes of this Agreement to be
          and
          shall be treated in all respects as a Canadian Revolving Credit Loan by
          way of a
          RBP Loan as and from such maturity date;

         

        
          	
                   

                	
                  (l)

                	
                  to
                    facilitate availment of Borrowings by way of BAs, each Canadian
                    Revolving
                    Borrower hereby appoints the Canadian Lender as its agent to
                    sign and
                    endorse on its behalf, in handwriting or by facsimile or mechanical
                    signature as and when deemed necessary by the Canadian Lender,
                    blank forms
                    of BAs in order to allow the Canadian Lender to complete and
                    accept from
                    time to time such instruments in the aggregate and face amounts
                    and for
                    the maturities chosen by such Canadian Revolving Borrower. Each
                    Canadian
                    Revolving Borrower recognizes and agrees that all BAs signed
                    and/or
                    endorsed on its behalf by the Canadian Lender shall bind such
                    Canadian
                    Revolving Borrower as fully and effectually as if signed in the
                    handwriting of and duly issued by the proper signing officers
                    of such
                    Canadian Revolving Borrower. In this connection, the parties
                    also agree
                    that the Canadian Lender shall not be liable for any damage,
                    loss or other
                    claim arising by reason of any loss or improper use of any BAs
                    issued
                    hereunder except if same results from the gross negligence or
                    wilful
                    misconduct of the Canadian Lender or its officers, employees,
                    agents or
                    representatives. On request by or on behalf of any Canadian Revolving
                    Borrower, the Canadian Lender shall cancel all forms of BAs which
                    have
                    been pre-signed or pre-endorsed by or on behalf of such Canadian
                    Revolving
                    Borrower and which are held by the Canadian Lender and have not
                    yet been
                    issued;

                

        

         

        
          	
                   

                	
                  (m)

                	
                  if
                    at any time during the term of this Agreement, the Canadian Lender
                    determines in good faith (which determination shall be final,
                    conclusive
                    and binding upon the Canadian Revolving Borrowers) that by reasons
                    of
                    circumstances or changes affecting the market for Bankers'
                    Acceptances:

                

        

         

        
          	
                   

                	
                  (i)

                	
                  it
                    is no longer possible to establish the Discount Rate in respect
                    of
                    Bankers' Acceptances, or

                

        

         

        
          	
                   

                	
                  (ii)

                	
                  the
                    market for Bankers' Acceptances no longer exists, is too weak
                    for its
                    normal use by the Canadian Lender or is not capable in the normal
                    course
                    of business to absorb Bankers' Acceptances accepted by the Canadian
                    Lender,

                

        

         

        then,
          the
          Canadian Lender shall immediately notify the Canadian Revolving Borrowers
          of its
          determination in writing.  For so long as the circumstances referred
          to in paragraphs (i) or (ii) of this paragraph (m) shall continue, the
          Canadian Lender shall not be obligated to make any further Canadian Revolving
          Credit Loans available by way of Bankers' Acceptances and thereafter, until
          notice to the contrary is given to the Canadian Revolving Borrowers by
          the
          Canadian Lender, the Canadian Lender shall only be obligated to make other
          forms
          of Canadian Revolving Credit Loans available to the Canadian Revolving
          Borrowers
          hereunder, and the principal amount of all Canadian Revolving
          Credit

         

        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

        Loans
          outstanding by way of Bankers' Acceptances shall, at the expiry of the
          related
          Bankers' Acceptances, be converted without novation into such other form
          of
          Canadian Revolving Credit Loan as the Canadian Revolving Borrowers may
          request
          by notice to the Canadian Lender or failing such notice, into RBP
          Loans;

         

        
          	
                   

                	
                  (n)

                	
                  the
                    Canadian Revolving Borrowers shall have no right to set up as
                    against the
                    Canadian Lender any defense or right of action, of indemnification
                    or of
                    set-off or compensation or any similar claim of any nature whatsoever
                    which the Canadian Revolving Borrowers may have had at any time
                    or may
                    have in the future with respect to any holder of one or more
                    Banker's
                    Acceptance(s) issued hereunder;

                

        

         

        
          	
                   

                	
                  (o)

                	
                  on
                    the maturity date of each Bankers' Acceptance issued hereunder,
                    the
                    Canadian Lender will pay to the redeeming holder, if any, of
                    each Bankers'
                    Acceptance, at the time of presentment thereof, the face amount
                    of such
                    Bankers' Acceptance.

                

        

         

        LCs
          or LGs:

         

        
          	
                   

                	
                  (a)

                	
                  each
                    Letter of Credit shall expire on a Business Day (in no event
                    later than
                    five Business Days prior to the Maturity Date) and shall have
                    a term of
                    not more than 365 days;

                

        

         

        
          	
                   

                	
                  (b)

                	
                  at
                    least  2 Business Days prior to the issue of a Letter of Credit,
                    the relevant Canadian Revolving Borrower shall execute a duly
                    authorized
                    application with respect to such Letter of Credit and each Letter
                    of
                    Credit shall be governed by the terms and conditions of the relevant
                    application for such contract;

                

        

         

        
          	
                   

                	
                  (c)

                	
                  a
                    Letter of Credit may not be revoked prior to its expiry date
                    unless the
                    consent of the beneficiary of the Letter of Credit has been
                    obtained;

                

        

         

        
          	
                   

                	
                  (d)

                	
                  if
                    there is any inconsistency at any time between the terms of this
                    Agreement
                    and the terms of the application for a Letter of Credit, the
                    terms of the
                    application for such Letter of Credit shall
                    govern;

                

        

         

        
          	
                   

                	
                  (e)

                	
                  subject
                    to paragraph (f) below, if the Canadian Lender makes a payment under
                    a Letter of Credit issued or outstanding in accordance herewith,
                    the
                    amount or amounts so paid by the Canadian Lender shall, unless
                    otherwise
                    funded by or for the account of the Canadian Revolving Borrowers,
                    be
                    deemed to constitute a RBP Loan in the case of a payment made
                    in Canadian
                    Dollars or in any currency other than US Dollars and a RBUSBR
                    Loan in the
                    case of a payment made in US Dollars, which shall bear interest
                    accordingly from the date of payment by the Canadian Lender until
                    full
                    repayment by the Canadian Revolving Borrowers and shall be repayable
                    on
                    demand.  If such payment is made in a currency other than
                    Canadian Dollars or US Dollars, the amount of such payment shall
                    be deemed
                    to constitute a RBP Loan in an amount equal to the Equivalent
                    Amount in
                    Canadian Dollars, as determined using the spot buying rate of
                    the Canadian
                    Lender as in effect at the time of
                    determination;

                

        

         

        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

        
          	
                   

                	
                  (f)

                	
                  if
                    and when a payment which the Canadian Lender is obliged to pay
                    pursuant to
                    a Letter of Credit issued or outstanding in accordance herewith
                    is made by
                    the Canadian Lender pursuant to such Letter of Credit, the Canadian
                    Revolving Borrowers shall forthwith pay to the Canadian Lender,
                    in the
                    currency(ies) in which such payment was made, the whole amount
                    so paid
                    under the said Letter of Credit and if the Canadian Revolving
                    Borrowers
                    fails to make such payment, the amount of such payment shall
                    be deemed to
                    constitute a demand RBP Loan or RBUSBR Loan, as the case may
                    be, hereunder
                    in accordance with paragraph (e)
                    above.

                

        

         

        Without
          restriction to the foregoing, the Canadian Revolving Borrowers shall, in
          addition, indemnify the Canadian Lender and hold it harmless from and against
          any claims, demands, losses, costs, liabilities, actions, judgments or
          suits,
          damages and expenses, including legal fees and expenses reasonably incurred
          which the Canadian Lender may suffer or incur by reason of having issued
          any
          Letter of Credit or having accepted drafts or documents thereunder or by
          reason
          of false or incomplete information being provided by the Canadian Revolving
          Borrowers to the Canadian Lender in respect of Canadian Revolving Credit
          Loans
          or proposed Canadian Revolving Credit Loans by way of Letters of Credit
          or
          acceptances thereunder or by reason of any action taken, admitted or suffered
          to
          be taken in good faith in reliance upon any instructions, applications,
          request
          or order from the Canadian Revolving Borrowers or any other party for whose
          account such Letter of Credit was issued or upon other paper or documents
          reasonably believed by the Canadian Lender to be genuine in connection
          with a
          Letter of Credit or acceptances under a Letter of Credit.

         

        The
          reimbursement and indemnity obligations of the Canadian Revolving Borrowers
          herein shall not be released, discharged or otherwise affected by any
          circumstance or occurrence whatsoever including, without limitation,
(a) the lack of validity or enforceability of the underlying
          Letter of Credit or any acceptance or other documentation presented for
          drawing
          thereunder, or (b) any dealing by the Canadian Lender with a
          beneficiary or negotiating, advising or confirming bank in connection with
          Letters of Credit and acceptances thereunder.

         

        Libor
          Loans:

         

        
          	
                   

                	
                  (a)

                	
                  The
                    relevant Canadian Revolving Borrower shall give to the Canadian
                    Lender an
                    irrevocable telephone notice at least by 10:30 a.m. on the Interest
                    Determination Date prior to any Borrowing by way of a Libor Loan
                    (including renewal or conversion thereof) followed by a written
                    confirmation substantially in the form of Exhibit C to the Credit
                    Agreement;

                

        

         

        
          	
                   

                	
                  (b)

                	
                  Libor
                    Loans shall be issued and mature on a Business Day and shall
                    be made in
                    minimum amounts of $1,000,000 in US currency or the Equivalent
                    Amount in
                    Eurocurrency as selected by the relevant Canadian Revolving Borrower
                    and
                    approved by the Canadian Lender or such larger amount as is a
                    whole
                    multiple of US$100,000 for terms of not less than 30 days and
                    not more
                    than 180 days;

                

        

         

        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

        
          	
                   

                	
                  (c)

                	
                  if
                    a Canadian Revolving Borrower fails to select and to notify the
                    Canadian
                    Lender of the Libor Interest Period applicable to any Libor Loan
                    of such
                    Canadian Revolving Borrower, such Canadian Revolving Borrower
                    shall be
                    deemed to have selected a 3 month Libor Interest
                    Period;

                

        

         

        
          	
                   

                	
                  (d)

                	
                  the
                    Canadian Revolving Borrowers shall indemnify and hold the Canadian
                    Lender
                    harmless against any loss, cost or expense (including without
                    limitation,
                    any loss incurred by the Canadian Lender in liquidating or redeploying
                    deposits acquired to fund or maintain any Libor Loan) incurred
                    by the
                    Canadian Lender as a result of:

                

        

         

        
          	
                   

                	
                  (i)

                	
                  repayments,
                    prepayments, conversions, rollovers or cancellations of a Libor
                    Loan other
                    than on the last day of the Libor Interest Period applicable
                    to such Libor
                    Loan, or

                

        

         

        
          	
                   

                	
                  (ii)

                	
                  failure
                    to draw down a Libor Loan on the first day of the Libor Interest
                    Period
                    selected by the relevant Canadian Revolving
                    Borrower;

                

        

         

        
          	
                   

                	
                  (e)

                	
                  if
                    the Canadian Lender determines, which determination is final,
                    conclusive
                    and binding upon the Canadian Revolving Borrowers,
                    that:

                

        

         

        
          	
                   

                	
                  (i)

                	
                  adequate
                    and fair means do not exist for ascertaining the rate of interest
                    on a
                    Libor Loan,

                

        

         

        
          	
                   

                	
                  (ii)

                	
                  the
                    making or the continuance of a Libor Loan has become impracticable
                    by
                    reason of circumstances which materially and adversely affect
                    the London
                    Interbank Market,

                

        

         

        
          	
                   

                	
                  (iii)

                	
                  deposits
                    in US currency (or other Eurocurrency selected) are not available
                    to the
                    Canadian Lender in the London Interbank Market in sufficient
                    amounts in
                    the ordinary course of business for the applicable Libor Interest
                    Period
                    to make or maintain a Libor Loan during such Libor Interest Period,
                    or

                

        

         

        
          	
                   

                	
                  (iv)

                	
                  the
                    cost to the Canadian Lender of making or maintaining a Libor
                    Loan does not
                    accurately reflect the effective cost to the Canadian Lender
                    thereof
                    or  the costs to the Canadian Lender are increased or the income
                    receivable by the Canadian Lender is reduced in respect of a
                    Libor
                    Loan,

                

        

         

        then
          the
          Canadian Lender shall promptly notify the relevant Canadian Revolving Borrower
          of such determination and such Canadian Revolving Borrower shall, prior
          to the
          next Interest Determination Date, notify the Canadian Lender as to the
          basis of
          Borrowing it has selected in substitution for such Libor Loan.  If
          such Canadian Revolving Borrower does not so notify the Canadian Lender,
          such
          Libor Loan will automatically be converted into an RBUSBR Loan on the expiry
          of
          the then current Libor Interest Period; and

         

        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

        
          	
                   

                	
                  (f)

                	
                  if
                    the adoption of any applicable law, or any change therein or
                    in the
                    interpretation or application thereof by any court or by any
                    governmental
                    or other authority or central bank or comparable agency or any
                    other
                    entity charged with the interpretation or administration thereof
                    or
                    compliance by the Canadian Lender with any request or direction
                    (whether
                    or not having the force of law) of any such authority, central
                    bank or
                    comparable agency or entity now or hereafter makes it unlawful
                    or
                    impossible for the Canadian Lender to make, fund or maintain
                    the Libor
                    Loans or a portion thereof or to perform its obligations under
                    this
                    Agreement, the Canadian Lender may, by written notice thereof
                    to the
                    Canadian Revolving Borrowers, suspend its obligations under this
                    Agreement
                    with respect to the Libor Loans affected by such illegality or
                    prohibition
                    (the "Affected Loans") for the duration of the period of such
                    illegality
                    or prohibition, and the Canadian Revolving Borrowers shall, to
                    the extent
                    possible and subject to the provisions of Section 3.9 of the
                    Agreement,
                    forthwith (or at the end of such period as the Canadian Lender
                    in its
                    discretion agrees) convert without novation the Affected Loans
                    or such
                    portion thereof together with accrued interest thereon for the
                    remainder
                    of the related Libor Interest Period(s) into such other forms
                    of Canadian
                    Revolving Credit Loans as the Canadian Revolving Borrowers may
                    request by
                    notice to the Canadian Lender within not more than two Business
                    Days after
                    receipt by the Canadian Revolving Borrowers of the notice of
                    the Canadian
                    Lender, and, for the period between such notice by the Canadian
                    Lender and
                    such notice by the Canadian Revolving Borrowers or failing such
                    notice by
                    the Canadian Revolving Borrowers, into RBUSBR Loans, and thereafter
                    the
                    Canadian Lender shall only be obligated to extend such Affected
                    Loans in
                    such other forms of Canadian Revolving Credit Loans or RBUSBR
                    Loans, as
                    the case may be.

                

        

         

        

        

        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

        SCHEDULE
          4

        

        MANDATORY
          COST

        

        

        
          	
                  1.

                	
                  The
                    Mandatory Cost is an addition to the interest rate to compensate
                    Lenders
                    for the cost of compliance with (a) the requirements of the Bank
                    of
                    England and/or the Financial Services Authority (or, in either
                    case, any
                    other authority which replaces all or any of its functions) or
                    (b) the
                    requirements of the European Central
                    Bank.

                

        

         

        
          	
                  2.

                	
                  On
                    the first day of each Interest Period (or as soon as possible
                    thereafter)
                    the Administrative Agent shall calculate, as a percentage rate,
                    a rate
                    (the “Associated Costs Rate”) for each Lender, in accordance with
                    the paragraphs set out below.  The Mandatory Cost will be
                    calculated by the Administrative Agent as a weighted average
                    of the
                    Lenders’ Associated Costs Rates (weighted in proportion to the percentage
                    participation of each Lender in the relevant Loan) and will be
                    expressed
                    as a percentage rate per annum.

                

        

         

        
          	
                  3.

                	
                  The
                    Associated Costs Rate for any Lender lending from a Facility
                    Office in a
                    Participating Member State will be the percentage notified by
                    that Lender
                    to the Administrative Agent.  This percentage will be certified
                    by that Lender in its notice to the Administrative Agent to be
                    its
                    reasonable determination of the cost (expressed as a percentage
                    of that
                    Lender’s participation in all Loans made from that Facility Office)
                    of
                    complying with the minimum reserve requirements of the European
                    Central
                    Bank in respect of loans made from that Facility
                    Office.

                

        

         

        
          	
                  4.

                	
                  The
                    Associated Costs Rate for any Lender lending from a Facility
                    Office in the
                    United Kingdom will be calculated by the Administrative Agent
                    as
                    follows:

                

        

         

        
          	
                   

                	
                  (a)

                	
                  in
                    relation to a Loan in Pounds
                    Sterling:

                

        

         

         
per
          cent. per annum

         

        
          	
                   

                	
                  (b)

                	
                  in
                    relation to a Loan in any currency other than Pounds
                    Sterling:

                

        

         

          per
          cent. per annum.

        

         

        Where:

         

        
          	
                   

                	
                  A

                	
                  is
                    the percentage of Eligible Liabilities (assuming these to be
                    in excess of
                    any stated minimum) which that Lender is from time to time required
                    to
                    maintain as an interest free cash ratio deposit with the Bank
                    of England
                    to comply with cash ratio
                    requirements.

                

        

         

        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

        
          	
                   

                	
                  B

                	
                  is
                    the percentage rate of interest (excluding the Applicable Rate
                    and the
                    Mandatory Cost and, if the Loan is an Unpaid Sum, the additional
                    rate of
                    interest specified in Section 2.13(c)) payable for the relevant
                    Interest
                    Period on the Loan.

                

        

         

        
          	
                   

                	
                  C

                	
                  is
                    the percentage (if any) of Eligible Liabilities which that Lender
                    is
                    required from time to time to maintain as interest bearing Special
                    Deposits with the Bank of England.

                

        

         

        
          	
                   

                	
                  D

                	
                  is
                    the percentage rate per annum payable by the Bank of England
                    to the
                    Administrative Agent on interest bearing Special
                    Deposits.

                

        

         

        
          	
                   

                	
                  E

                	
                  is
                    designed to compensate Lenders for amounts payable under the
                    Fees Rules
                    and is calculated by the Administrative Agent as being the average
                    of the
                    most recent rates of charge supplied by the Reference Banks to
                    the
                    Administrative Agent pursuant to paragraph 7 below and expressed
                    in pounds
                    per £1,000,000.

                

        

         

        
          	
                  5.

                	
                  For
                    the purposes of this Schedule:

                

        

         

        
          	
                   

                	
                  (a)

                	
                  “Eligible
                    Liabilities” and “Special Deposits” have the
                    meanings given to them from time to time under or pursuant to
                    the Bank of
                    England Act 1998 or (as may be appropriate) by the Bank of
                    England;

                

        

         

        
          	
                   

                	
                  (b)

                	
                  “Facility
                    Office” means the office or offices notified by a Lender to
                    the
                    Administrative Agent in writing on or before the date it becomes
                    a Lender
                    (or, following that date, by not less than five Business Days’ written
                    notice) as the office or offices through which it will perform
                    its
                    obligations under this Agreement.

                

        

         

        
          	
                   

                	
                  (c)

                	
                  “Fees
                    Rules” means the rules on periodic fees contained in the FSA
                    Supervision Manual or such other law or regulation as may be
                    in force from
                    time to time in respect of the payment of fees for the acceptance
                    of
                    deposits;

                

        

         

        
          	
                   

                	
                  (d)

                	
                  “Fee
                    Tariffs” means the fee tariffs specified in the Fees Rules under
                    the activity group A.1 Deposit acceptors (ignoring any minimum
                    fee or zero
                    rated fee required pursuant to the Fees Rules but taking into
                    account any
                    applicable discount rate);

                

        

         

        
          	
                   

                	
                  (e)

                	
                  “Participating
                    Member State” means any member state of the European Union that
                    adopts or has adopted the euro as its lawful currency in accordance
                    with
                    legislation of the European Union relating to economic and monetary
                    union.

                

        

         

        
          	
                   

                	
                  (f)

                	
                  “Reference
                    Banks” means, in relation to Mandatory Cost, the principal
                    London
                    offices of JPMorgan Chase Bank, National
                    Association.

                

        

         

        
          	
                   

                	
                  (g)

                	
                  “Tariff
                    Base” has the meaning given to it in, and will be calculated
                    in
                    accordance with, the Fees Rules.

                

        

         

        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

        
          	
                   

                	
                  (h)

                	
                  “Unpaid
                    Sum” means any sum due and payable but unpaid by any Borrower
                    under the Loan Documents.

                

        

         

        
          	
                  6.

                	
                  In
                    application of the above formulae, A, B, C and D will be included
                    in the
                    formulae as percentages (i.e. 5 per cent. will be included in
                    the formula
                    as 5 and not as 0.05).  A negative result obtained by
                    subtracting D from B shall be taken as zero.  The resulting
                    figures shall be rounded to four decimal
                    places.

                

        

         

        
          	
                  7.

                	
                  If
                    requested by the Administrative Agent, each Reference Bank shall,
                    as soon
                    as practicable after publication by the Financial Services Authority,
                    supply to the Administrative Agent, the rate of charge payable
                    by that
                    Reference Bank to the Financial Services Authority pursuant to
                    the Fees
                    Rules in respect of the relevant financial year of the Financial
                    Services
                    Authority (calculated for this purpose by that Reference Bank
                    as being the
                    average of the Fee Tariffs applicable to that Reference Bank
                    for that
                    financial year) and expressed in pounds per £1,000,000 of the Tariff Base
                    of that Reference Bank.

                

        

         

        
          	
                  8.

                	
                  Each
                    Lender shall supply any information required by the Administrative
                    Agent
                    for the purpose of calculating its Associated Costs Rate.  In
                    particular, but without limitation, each Lender shall supply
                    the following
                    information on or prior to the date on which it becomes a
                    Lender:

                

        

         

        
          	
                   

                	
                  (i)

                	
                  the
                    jurisdiction of its Facility Office;
                    and

                

        

         

        
          	
                   

                	
                  (j)

                	
                  any
                    other information that the Administrative Agent may reasonably
                    require for
                    such purpose.

                

        

         

        Each
          Lender shall promptly notify the Administrative Agent of any change to
          the
          information provided by it pursuant to this paragraph.

         

        
          	
                  9.

                	
                  The
                    percentages of each Lender for the purpose of A and C above and
                    the rates
                    of charge of each Reference Bank for the purpose of E above shall
                    be
                    determined by the Administrative Agent based upon the information
                    supplied
                    to it pursuant to paragraphs 7 and 8 above and on the assumption
                    that,
                    unless a Lender notifies the Administrative Agent to the contrary,
                    each
                    Lender’s obligations in relation to cash ratio deposits and Special
                    Deposits are the same as those of a typical bank from its jurisdiction
                    of
                    incorporation with a Facility Office in the same jurisdiction
                    as its
                    Facility Office.

                

        

         

        
          	
                  10.

                	
                  The
                    Administrative Agent shall have no liability to any person if
                    such
                    determination results in an Associated Costs Rate which over
                    or under
                    compensates any Lender and shall be entitled to assume that the
                    information provided by any Lender or Reference Bank pursuant
                    to
                    paragraphs 3, 7 and 8 above is true and correct in all
                    respects.

                

        

         

        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

        
          	
                  11.

                	
                  The
                    Administrative Agent shall distribute the additional amounts
                    received as a
                    result of the Mandatory Cost to the Lenders on the basis of the
                    Associated
                    Costs Rate for each Lender based on the information provided
                    by each
                    Lender and each Reference Bank pursuant to paragraphs 3, 7 and
                    8
                    above.

                

        

         

        
          	
                  12.

                	
                  Any
                    determination by the Administrative Agent pursuant to this Schedule
                    in
                    relation to a formula, the Mandatory Cost, an Associated Costs
                    Rate or any
                    amount payable to a Lender shall, in the absence of manifest
                    error, be
                    conclusive and binding on all parties
                    hereto.

                

        

         

        The
          Administrative Agent may from time to time, after consultation with the
          Company
          and the relevant Lenders, determine and notify to all parties hereto any
          amendments which are required to be made to this Schedule 2.02 in order
          to
          comply with any change in law, regulation or any requirements from time
          to time
          imposed by the Bank of England, the Financial Services Authority or the
          European
          Central Bank (or, in any case, any other authority which replaces all or
          any of
          its functions) and any such determination shall, in the absence of manifest
          error, be conclusive and binding on all parties hereto.

        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

        

        SCHEDULE
          7.2

         

        SUBSIDIARIES

         

        

        
          	
                  NAME

                	
                  JURISDICTION
                    OF 

                  ORGANIZATION

                	
                  PERCENTAGE
                    

                  OWNERSHIP

                	 	
                  OWNER

                
	
                  LoJack
                    Exchangeco Canada Inc

                	
                  Canada

                	
                  100%

                	 	
                  LoJack
                    Corporation

                
	
                  LoJack
                    International Corporation

                	
                  Delaware

                	
                  100%

                	 	
                  LoJack
                    Corporation

                
	
                  LoJack
                    Global LLC

                	
                  Delaware

                	
                  100%

                	 	
                  LoJack
                    Corporation

                
	
                  LoJack
                    Operating Company, L.P

                	
                  Delaware

                	
                  100%

                	 	
                  LoJack
                    Corporation

                
	
                  6292887
                    Canada Inc.

                	
                  Canada

                	
                  100%

                	 	
                  LoJack
                    Corporation

                
	
                  Vehicle
                    Recovery Systems Company*

                	
                  Nova
                    Scotia

                	
                  100%

                	 	
                  LoJack
                    Corporation

                
	
                  LoJack
                    de Mexico, S. de R.L. de CV

                	
                  Mexico

                	
                  100%

                	 	
                  LoJack
                    Corporation

                
	
                  LoJack
                    do Brasil LTDA

                	
                  Brazil

                	
                  100%

                	 	
                  LoJack
                    Corporation

                
	
                  LoJack
                    International Benelux SPRL**

                	
                  Belgium

                	
                  94.59%

                	 	
                  LoJack
                    Corporation

                
	
                  LoJack
                    Italia Srl

                	
                  Italy

                	
                  100%

                	 	
                  LoJack
                    Corporation

                
	
                  Boomerang
                    Tracking Inc.

                	
                  Canada

                	
                  100%

                	 	
                  LoJack
                    Corporation

                
	
                  LoJack
                    Equipment Ireland Limited

                	
                  Ireland

                	
                  100%

                	 	
                  LoJack
                    Corporation

                
	
                  LoJack
                    Network SRL

                	
                  Italy

                	
                  100%

                	 	
                  LoJack
                    Corporation

                
	
                  An
                    Jie China Holdings Limited

                	
                  Cyprus

                	
                  100%

                	 	
                  LoJack
                    Corporation

                
	
                  LJPR

                	
                  Puerto
                    Rico

                	
                  100%

                	 	
                  LoJack
                    Corporation

                
	
                  LoJack
                    Uruguay

                	
                  Uruguay

                	
                  100%

                	 	
                  LoJack
                    Corporation

                
	
                  LoJack
                    European Network BV

                	
                  Netherlands

                	
                  100%

                	 	
                  LoJack
                    Corporation

                

        

        
          

           

          

        

         

        *Inactive
          Subsidiary

                      
          **5.41%
          owned by Traquer, S.A., a French
          company in which LoJack Corporation owns a 12.5% interest.

         

         

        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

        SCHEDULE
          9.1/9.2

         

        PERMITTED
          INDEBTEDNESS AND LIENS

        

        
          	
                  DESCRIPTION
                    OF INDEBTEDNESS

                	
                  DESCRIPTION
                    OF

                  COLLATERAL/SECURITY,
                    IF ANY

                
	 	 
	
                  1.  Indebtedness
                    of the Borrowers under the existing Credit Agreement to be repaid
                    on the
                    closing.

                	
                  None.

                
	 	 
	
                  2.
                    Indebtedness of the Borrowers to Citizens Bank under two Letters
                    of
                    Credit  with $1,111,000 outstanding as of December 31,
                    2006.

                	
                  None.

                
	 	 
	
                  DESCRIPTION
                    OF LIENS

                	 
	 	 
	
                  1.
                    Deposit Certificate in favor of Royal Bank

                	 
	 	 
	
                  2.
                    See attached

                	 

        

        

        --------

        *  Amount
          should combine principal together with accrued interest and breakage
          compensation, if any, to be paid by the Assignee, net of any portion of
          any
          upfront fee to be paid by the Assignor to the Assignee. It may be preferable
          in
          an appropriate case to specify these amounts generically or by formula
          rather
          than as a fixed sum

        

        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

        SCHEDULE
          14.7

        

        ADDRESSES
          FOR NOTICES 

         

         

        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

        EXHIBITS

        

        
          	
                  EXHIBIT
                    A

                	
                  Form
                    of Assumption and Assignment

                
	
                  EXHIBIT
                    B

                	
                  Form
                    of Revolving Credit Loan Request

                
	
                  EXHIBIT
                    C

                	
                  Form
                    of Canadian Revolving Credit Loan Request

                
	
                  EXHIBIT
                    D

                	
                  Form
                    of Swing Line Loan Request

                
	
                  EXHIBIT
                    E

                	
                  Form
                    of Compliance Certificate

                
	
                  EXHIBIT
                    F

                	
                  Form
                    of Instrument of Accession

                
	
                  EXHIBIT
                    G

                	
                  Form
                    of Joinder AgreementEXHIBIT 4.2  

KODIAK OIL & GAS
CORP.

INCENTIVE STOCK OPTION AGREEMENT 

        This
INCENTIVE STOCK OPTION AGREEMENT (the “Agreement”) is made this
_____ day of _______, ___, by and between Kodiak Oil & Gas Corp., a Yukon
Territory corporation (the “Company”) and ________, an individual
resident of _________________ (“Employee”). 

     
        
1.       
          Grant of Option.  The Company hereby grants Employee the option (the
          “Option”) to purchase all or any part of an aggregate of
          ________ shares (the “Shares”) of Common Stock of the Company
          at the exercise price of _____ per share according to the terms and conditions
          set forth in this Agreement and in the Kodiak Oil & Gas Corp. 2007
          Stock Incentive Plan (the “Plan”). The Option will be
          treated as an incentive stock option within the meaning of Section 422 of
          the Internal Revenue Code of 1986, as amended (the “Code”). The Option
          is issued under the Plan and is subject to its terms and conditions. A copy of
          the Plan will be furnished upon request of Employee. 

          The
Option shall terminate at the close of business ten years from the date hereof. 

             2.       
          Vesting of Option Rights. 

             (a)       
          Except as otherwise provided in this Agreement, the Option may be exercised by
          Employee in accordance with the following schedule: 

	

        On or after each of           

        the following dates           

________________________

                                      

   [Each of the first, second and     

 third anniversaries of the date of   

             the grant]               	
           Number of Shares              

        with respect to which            

      the Option is exercisable          

________________________

                                         

                [1/3]
 

             (b)       
          During the lifetime of Employee, the Option shall be exercisable only by
          Employee and shall not be assignable or transferable by Employee, other than by
          will or the laws of descent and distribution. 

             (c)       
          Employee understands that to the extent that the aggregate fair market value
          (determined at the time the option was granted) of the shares of Common Stock of
          the Company with respect to which all options that are incentive stock options
          within the meaning of Section 422 of the Code are exercisable for the first time
          by Employee during any calendar year exceed $100,000, in accordance with Section
          422(d) of the Code, such options shall be treated as options that do not qualify
          as incentive stock options. 

             3.    
          Exercise of Option after Death or Termination of Employment 

        The
Option shall terminate and may no longer be exercised if Employee ceases to be employed by
the Company or its affiliates, except that: 

          		    (a)       
               If Employee’s employment shall be terminated for any reason, voluntary or
               involuntary, other than for “Cause” (as defined in Section 3(e)) or
               Employee’s death or disability (within the meaning of Section 22(e)(3)
               of the Code), Employee may at any time within a period of 3 months after such
               termination exercise the Option to the extent the Option was exercisable by
               Employee on the date of the termination of Employee’s employment. 

               

          		    (b)       
               If Employee’s employment is terminated for Cause, the Option shall be
               terminated as of the date of the act giving rise to such termination. 

               

          		    (c)       
               If Employee shall die while the Option is still exercisable according to its
               terms or if employment is terminated because Employee has become disabled
               (within the meaning of Section 22(e)(3) of the Code) while in the employ of
               the Company and Employee shall not have fully exercised the Option, such Option
               may be exercised at any time within 12 months after Employee’s death or
               date of termination of employment for disability by Employee, personal
               representatives or administrators or guardians of Employee, as applicable or by
               any person or persons to whom the Option is transferred by will or the
               applicable laws of descent and distribution, to the extent of the full number of
               Shares Employee was entitled to purchase under the Option on (i) the earlier of
               the date of death or termination of employment or (ii) the date of termination
               for such disability, as applicable. 

               

          		    (d)       
               Notwithstanding the above, in no case may the Option be exercised to any extent
               by anyone after the termination date of the Option. 

               

          		    (e)       
               “Cause” shall mean (i) the willful and continued failure
               by Employee substantially to perform his or her duties and obligations (other
               than any such failure resulting from his or her incapacity due to physical or
               mental illness), (ii) Employee’s conviction or plea bargain of any
               felony or gross misdemeanor involving moral turpitude, fraud or misappropriation
               of funds or (iii) the willful engaging by Employee in misconduct which
               causes substantial injury to the Company or its affiliates, its other employees
               or the employees of its affiliates or its clients or the clients of its
               affiliates, whether monetarily or otherwise. For purposes of this paragraph, no
               action or failure to act on Employee’s part shall be considered
               “willful” unless done or omitted to be done, by Employee in bad faith
               and without reasonable belief that his or her action or omission was in the best
               interests of the Company. 

               

             4.       
          Method of Exercise of Option. Subject to the foregoing, the Option may be
          exercised in whole or in part from time to time by serving written notice of
          exercise on the Company at its principal office within the Option period. The
          notice shall state the number of Shares as to which the Option is being
          exercised and shall be accompanied by payment of the exercise price. Payment of
          the exercise price shall be made in cash (including bank check, personal check
          or money order payable to the Company). 

2 

             5.       
          Miscellaneous 

             (a)       
          Plan Provisions Control. In the event that any provision of the Agreement
          conflicts with or is inconsistent in any respect with the terms of the Plan, the
          terms of the Plan shall control. 

             (b)       
          No Rights of Stockholders. Neither Employee, Employee’s legal
          representative nor a permissible assignee of this Option shall have any of the
          rights and privileges of a stockholder of the Company with respect to the
          Shares, unless and until such Shares have been issued in the name of Employee,
          Employee’s legal representative or permissible assignee, as applicable. 

             (c)       
          No Right to Employment. The grant of the Option shall not be construed as
          giving Employee the right to be retained in the employ of, or as giving a
          director of the Company or an Affiliate (as defined in the Plan) the right to
          continue as a director of the Company or an Affiliate with, the Company or an
          Affiliate, nor will it affect in any way the right of the Company or an
          Affiliate to terminate such employment or position at any time, with or without
          cause or remove a Director in accordance with applicable law. In addition, the
          Company or an Affiliate may at any time dismiss Employee from employment, or
          terminate the term of a director of the Company or an Affiliate, free from any
          liability or any claim under the Plan or the Agreement. Nothing in the Agreement
          shall confer on any person any legal or equitable right against the Company or
          any Affiliate, directly or indirectly, or give rise to any cause of action at
          law or in equity against the Company or an Affiliate. The Option granted
          hereunder shall not form any part of the wages or salary of Employee for
          purposes of severance pay or termination indemnities, irrespective of the reason
          for termination of employment. Under no circumstances shall any person ceasing
          to be an employee of the Company or any Affiliate be entitled to any
          compensation for any loss of any right or benefit under the Agreement or Plan
          which such employee might otherwise have enjoyed but for termination of
          employment, whether such compensation is claimed by way of damages for wrongful
          or unfair dismissal, breach of contract or otherwise. By participating in the
          Plan, Employee shall be deemed to have accepted all the conditions of the Plan
          and the Agreement and the terms and conditions of any rules and regulations
          adopted by the Committee and shall be fully bound thereby. 

             (d)       
          Governing Law. The validity, construction and effect of the Plan and the
          Agreement, and any rules and regulations relating to the Plan and the Agreement,
          shall be determined in accordance with the internal laws, and not the law of
          conflicts, of the Yukon Territory. 

             (e)       
          Severability. If any provision of the Agreement is or becomes or is
          deemed to be invalid, illegal or unenforceable in any jurisdiction or would
          disqualify the Agreement under any law deemed applicable by the Committee (as
          defined in the Plan), such provision shall be construed or deemed amended to
          conform to applicable laws, or if it cannot be so construed or deemed amended
          without, in the determination of the Committee, materially altering the purpose
          or intent of the Plan or the Agreement, such provision shall be stricken as to
          such jurisdiction or the Agreement, and the remainder of the Agreement shall
          remain in full force and effect. 

             (f)       
          No Trust or Fund Created. Neither the Plan nor the Agreement shall create
          or be construed to create a trust or separate fund of any kind or a fiduciary
          relationship between the Company or any Affiliate and Employee or any other
          person. To the extent that any Person  

3 

acquires a right to receive payments
from           the Company or any Affiliate pursuant to an Award, such right shall be no
          greater than the right of any unsecured general creditor of the Company or any
          Affiliate. 

             (g)       
          Headings. Headings are given to the Sections and subsections of the
          Agreement solely as a convenience to facilitate reference. Such headings shall
          not be deemed in any way material or relevant to the construction or
          interpretation of the Agreement or any provision thereof. 

             (h)       
          Conditions Precedent to Issuance of Shares. Shares shall not be issued
          pursuant to the exercise of the Option unless such exercise and the issuance and
          delivery of the applicable Shares pursuant thereto shall comply with all
          relevant provisions of law, including, without limitation, the Securities Act of
          1933, as amended, the Exchange Act of 1934, as amended, the rules and
          regulations promulgated thereunder, the requirements of any applicable stock
          exchange and the laws of the Yukon Territory. As a condition to the exercise of
          the purchase price relating to the Option, the Company may require that the
          person exercising or paying the purchase price represent and warrant that the
          Shares are being purchased only for investment and without any present intention
          to sell or distribute such Shares if, in the opinion of counsel for the Company,
          such a representation and warranty is required by law. 

             (i)       
          Withholding. If Employee shall dispose of any of the shares of Common
          Stock acquired upon exercise of the Option within two (2) years from the date
          the Option was granted or within one (1) year after the date of exercise of the
          Option, then, in order to provide the Company with the opportunity to claim the
          benefit of any income tax deduction, Employee shall promptly notify the Company
          of the dates of acquisition and disposition of such shares, the number of shares
          so disposed of, and the consideration, if any, received for such shares. In
          order to comply with all applicable federal or state income tax laws or
          regulations, the Company may take such action as it deems appropriate to assure
          (i) notice to the Company of any disposition of the shares of the Company
          within the time periods described above, and (ii) that, if necessary, all
          applicable federal or state payroll, withholding, income or other taxes are
          withheld or collected from Employee. 

             (j)       
          Consultation With Professional Tax and Investment Advisors. The holder of
          this Option acknowledges that the grant, exercise, vesting or any payment with
          respect to this Option, and the sale or other taxable disposition of the Shares
          acquired pursuant to the exercise thereof, may have tax consequences pursuant to
          the Code or under local, state or international tax laws. The holder further
          acknowledges that such holder is relying solely and exclusively on the
          holder’s own professional tax and investment advisors with respect to any
          and all such matters (and is not relying, in any manner, on the Company or any
          of its employees or representatives). Finally, the holder understands and agrees
          that any and all tax consequences resulting from the Option and its grant,
          exercise, vesting or any payment with respect thereto, and the sale or other
          taxable disposition of the Shares acquired pursuant to the Plan, is solely and
          exclusively the responsibility of the holder without any expectation or
          understanding that the Company or any of its employees or representatives will
          pay or reimburse such holder for such taxes or other items. 

4 

        IN
WITNESS WHEREOF, the Company and Employee have executed this Agreement on the date set
forth in the first paragraph. 

	  	
KODIAK OIL & GAS CORP. 

By:  __________________________________

Name:  ________________________________

Title:  _________________________________

EMPLOYEE

______________________________________

Name:  ________________________________

 

5

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