Document:

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Exhibit 10.1

                                                                  EXECUTION COPY

                                 AMENDMENT NO. 1
                                       TO
                  SECOND AMENDED AND RESTATED CREDIT AGREEMENT

         This Amendment No. 1 (this "AMENDMENT") is entered into as of August
14, 2001 by and among INSILCO TECHNOLOGIES, INC., a Delaware corporation (the
"COMPANY"), T.A.T. TECHNOLOGY INC., a company organized under the laws of Quebec
(the "CANADIAN BORROWER"), the undersigned lenders (collectively, the
"LENDERS"), BANK ONE, NA, having its principal office in Chicago, Illinois, both
as one of the Lenders and as Administrative Agent (the "AGENT") on behalf of
itself and the other Lenders, and DLJ Capital Funding, Inc., as Syndication
Agent for the Lenders.

                                    RECITALS:

         WHEREAS, the Company, the Canadian Borrower, certain of the Lenders
(the "ORIGINAL LENDERS") and the Agent are parties to that certain Second
Amended and Restated Credit Agreement dated as of August 25, 2000 (as amended,
supplemented or otherwise modified prior to the date hereof, the "CREDIT
AGREEMENT"); and

         WHEREAS, the parties hereto desire to (i) waive certain currently
existing Defaults under the Credit Agreement and (ii) amend the Credit Agreement
in certain respects more fully described below;

         NOW, THEREFORE, in consideration of the premises herein contained and
for good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto hereby agree as follows:

         SECTION 1. DEFINED TERMS. Capitalized terms used herein and not
otherwise defined herein shall have the meanings attributed to such terms in the
Credit Agreement.

         SECTION 2. AMENDMENT TO CREDIT AGREEMENT. Upon the effectiveness of
this Amendment in accordance with the provisions of SECTION 4 below, the Credit
Agreement is hereby amended as set forth in this SECTION 2 below:

         SECTION 2.1. SECTION 1.1 of the Credit Agreement is hereby amended by
amending each of the following defined terms in its entirety, in each case to
read as follows:

                  "AGENTS" means the Administrative Agent.

                  "AGGREGATE PRO RATA SHARE" means, with respect to any Lender,
         the percentage obtained by dividing (a) the sum of (i) such Lender's
         Revolving Loan

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         Commitment at such time and (ii) such Lender's Term Loans (other than
         Term-C Loans) outstanding at such time by (b) the sum of (i) the
         aggregate amount of all Revolving Loan Commitments at such time and
         (ii) the aggregate amount of all Term Loans (other than Term-C Loans)
         outstanding at such time; PROVIDED, HOWEVER, if all of the Commitments
         are terminated pursuant to the terms hereof, then "Aggregate Pro Rata
         Share" means the percentage obtained by dividing (x) such Lender's
         outstanding Term Loans (other than Term-C Loans) and Revolving Loans by
         (y) the aggregate outstanding amount of all Term Loans (other than
         Term-C Loans) and Revolving Loans.

                  "CHANGE IN CONTROL" means (a) the failure of Holdco at any
         time to own, free and clear of all Liens and encumbrances (other than
         Liens of the types permitted to exist under CLAUSES (B), (D) and (g) of
         SECTION 7.2.3), all right, title and interest in 100% of the Capital
         Stock of the Company (other than (i) warrants to purchase common stock
         and (ii) shares of common stock of the Company issued upon exercise of
         such warrants); (b) the failure of the Equity Investors, their
         Affiliates and members of management of the Company and the Restricted
         Subsidiaries, in the aggregate, at any time to own, free and clear of
         all Liens and encumbrances (other than Liens of the types permitted to
         exist under CLAUSE (D) or (G) of SECTION 7.2.3) all right, title and
         interest in at least 51% (on a fully diluted basis) of the economic and
         voting interest in the Voting Stock of Holdco.

                  "COMMITTED LOAN" means a Term Loan (other than Term-C Loans),
         a Committed Revolving Loan or a Swing Line Loan.

                  "EBITDA" means, (I) for any applicable period ending on or
         prior to December 31, 2001, subject to CLAUSE (B) of SECTION 1.4, the
         sum for the Company and its Restricted Subsidiaries on a consolidated
         basis of

                  (a) Net Income;

         PLUS

                  (b) the amount deducted in determining Net Income for such
         period representing non-cash charges or expenses, including
         depreciation, amortization, non-cash periodic post-retirement benefits
         and non-cash expenses related to employee stock options and stock
         incentive plans (excluding any non-cash charges representing an accrual
         of or reserve for cash charges to be paid within the next twelve
         months);

         PLUS

                  (c) the amount deducted in determining Net Income for such
         period representing income taxes (whether paid or deferred);

         PLUS

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                  (d) the amount deducted in determining Net Income for such
         period representing interest expense and Transaction Payments;

         PLUS

                  (e) the amount deducted in determining Net Income for such
         period representing all transaction-related costs and expenses incurred
         in connection with or relating to the Taylor Sale or the T.A.T.
         Acquisition;

         PLUS

                  (f) the "Performance Bonus" payable by the Canadian Borrower
         to David Mesri pursuant to Section 4.1 of the Employment Agreement
         attached as Schedule B to the T.A.T. Acquisition Agreement and accrued
         bonuses payable in connection with the Acquisition;

         PLUS

                  (g) to the extent not included in Transaction Payments,
         deferred compensation or performance bonuses actually paid in cash to
         members of management in connection with an acquisition permitted
         pursuant to CLAUSE (B) of SECTION 7.2.8;

         MINUS

                  (h) Restricted Payments of the type referred to in CLAUSE (a)
         of SECTION 7.2.6 made during such period;

         and (II) for any applicable period ending after December 31, 2001,
         subject to CLAUSE (B) of SECTION 1.4, the sum for the Company and its
         Restricted Subsidiaries on a consolidated basis of

                  (a) Net Income;

         PLUS

                  (b) the amount deducted in determining Net Income for such
         period representing non-cash charges or expenses, including
         depreciation, amortization, non-cash periodic post-retirement benefits
         and non-cash expenses related to employee stock options and stock
         incentive plans (excluding any non-cash charges representing an accrual
         of or reserve for cash charges to be paid in any subsequent period,
         other than non-cash charges for post-retirement benefits not exceeding
         $1,000,000 for any four-Fiscal Quarter period);

         PLUS

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                  (c) the amount deducted in determining Net Income for such
         period representing income taxes (whether paid or deferred);

         PLUS

                  (d) the amount deducted in determining Net Income for such
         period representing interest expense and Transaction Payments
         (excluding Transaction Payments incurred after the Fiscal Quarter ended
         on or about June 30, 2001, other than fees and expenses incurred in
         connection with Amendment No. 1);

         PLUS

                  (e) the amount deducted in determining Net Income for such
         period representing all transaction-related costs and expenses incurred
         in connection with or relating to the Taylor Sale or the T.A.T.
         Acquisition (excluding such costs and expenses incurred after the
         Fiscal Quarter ended on or about June 30, 2001);

         PLUS

                  (f) the "Performance Bonus" payable by the Canadian Borrower
         to David Mesri pursuant to Section 4.1 of the Employment Agreement
         attached as Schedule B to the T.A.T. Acquisition Agreement and accrued
         bonuses payable in connection with the Acquisition (excluding any bonus
         payments (or similar payments pursuant to any acquisition) made after
         the Fiscal Quarter ended on or about June 30, 2001).

                  "LENDER PARTIES" means, collectively, the Lenders, the Issuers
         and the Administrative Agent.

                  "LOAN" means, as the context may require, a Revolving Loan, a
         Term-A Loan, a Term-B Loan, a Term-C Loan or a Swing Line Loan, of any
         type, PROVIDED, HOWEVER, that as used in the Collateral Documents,
         "Loan" shall not include a Term-C Loan.

                  "LOAN DOCUMENT" means this Agreement, the Notes, the Letters
         of Credit, each Rate Protection Agreement, each Borrowing Request, each
         Issuance Request, the Administrative Agent Fee Letter, each Pledge
         Agreement, the Subsidiary Guaranty, the Canadian Collateral Documents,
         each Mortgage (upon execution and delivery thereof), and each other
         agreement, document or instrument delivered in connection with this
         Agreement or any other Loan Document, whether or not specifically
         mentioned herein or therein, PROVIDED, HOWEVER, that as used in the
         Collateral Documents, "Loan Document" shall not include the Term-C
         Notes.

                  "NOTE" means, as the context may require, a Revolving Note, a
         Term-A Note, a Term-B Note, a Term-C Note or a Swing Line Note,
         PROVIDED, HOWEVER,

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         that as used in the Collateral Documents, "Note" shall not include the
         Term-C Notes.

                  "OBLIGATIONS" means all obligations (monetary or otherwise,
         whether absolute or contingent, matured or unmatured) of the Borrowers
         and each other Obligor arising under or in connection with a Loan
         Document, including Reimbursement Obligations and the principal of and
         premium, if any, and interest (including interest accruing during the
         pendency of any proceeding of the type described in Section 8.1.9,
         whether or not allowed in such proceeding) on the Loans, PROVIDED,
         HOWEVER, that as used in the Collateral Documents, "Obligations" shall
         not include the Term-C Obligations.

                  "OBLIGOR" means a Borrower or any other Person (other than any
         Secured Party or any Term-C Lender) obligated under any Loan Document.

                  "SECURED PARTIES" means, collectively, the Lender Parties
         other than the Term-C Lenders and each counterparty to a Rate
         Protection Agreement that is (or at the time such Rate Protection
         Agreement was entered into, was) a Lender other than a Term-C Lender or
         an Affiliate of a Lender other than a Term-C Lender; PROVIDED, HOWEVER,
         that the Term-C Lenders shall be deemed to be "Secured Parties" solely
         for the purpose of effectuating, and only to the extent required to
         effectuate, the Subsidiary Guaranty and the guaranty contained in
         ARTICLE III of the Holdco Guaranty and Pledge Agreement and the
         covenants of Holdco set forth in SECTIONS 5.6, 5.7, 5.8 and 5.9 thereof
         (but not for purposes of the benefits of the Collateral covered by the
         Holdco Guaranty and Pledge Agreement).

                  "STATED MATURITY DATE" means (a) in the case of any Committed
         Loan (other than a Term- B Loan), the sixth anniversary of the
         Effective Date, (b) in the case of any Term-B Loan, March 25, 2007, (c)
         in the case of any Term-C Loan, June 25, 2007 and (d) in the case of
         any Uncommitted Revolving Loan, the earlier of (i) the Stated Maturity
         Date for Committed Revolving Loans and (ii) the maturity date that
         shall have been agreed between the Company and the Lender or Lenders
         that shall have made, or offered or agreed to make, such Uncommitted
         Revolving Loan, or, in the case of any such day that is not a Business
         Day, the first Business Day following such day.

                  "TERM LOANS" means, collectively, the Term-A Loans, the Term-B
         Loans and the Term-C Loans, PROVIDED, HOWEVER, that as used in the
         Collateral Documents, "Term Loans" shall not include the Term C-Loans.

                  "TOTAL EXPOSURE AMOUNT" means,

                  (I) on any date of determination on which any Commitments or
         any Obligations other than Term-C Obligations are outstanding, (a) with
         respect to any provision of this Agreement other than the declaration
         of the acceleration of

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         the maturity of all or any portion of the outstanding principal amount
         of the Loans and other Obligations to be due and payable pursuant to
         SECTION 8.3, the sum of (i) the aggregate principal amount of all Term
         Loans (other than Term-C Loans) outstanding at such time, (ii) the
         aggregate undrawn amount of any Additional Term Loan Commitments then
         outstanding and (iii) (A) the then effective Revolving Loan Commitment
         Amount, if there are any Revolving Loan Commitments then outstanding,
         or (B) if all Revolving Loan Commitments shall have expired or been
         terminated, the sum of (1) the aggregate principal amount of all
         Revolving Loans and Swing Line Loans outstanding at such time and (2)
         the Letter of Credit Outstandings at such time; and (b) with respect to
         the declaration of the acceleration of the maturity of all or any
         portion of the outstanding principal amount of the Loans and other
         Obligations to be due and payable pursuant to SECTION 8.3, the sum of
         (i) the aggregate principal amount of all Loans (other than Term-C
         Loans) outstanding at such time and (ii) the Letter of Credit
         Outstandings at such time, and

                  (II) on any date of determination on which no Commitments or
         any Obligations other than Term-C Obligations are outstanding, the sum
         of (a) the aggregate principal amount of all Term-C Loans outstanding
         at such time and (b) the aggregate amount of accrued and unpaid
         interest on Term-C Loans outstanding at such time.

                  "TRANCHE" means, as the context may require, the Loans or
         Commitments constituting Term-A Loans or Additional Term-A Loan
         Commitments, Term-B Loans or Additional Term-B Loan Commitments, Term-C
         Loans, Revolving Loans or Revolving Loan Commitments, Swing Line Loans
         or the Swing Line Loan Commitment.

         SECTION 2.2. SECTION 1.1 of the Credit Agreement is hereby further
amended by amending the definition of "APPLICABLE COMMITMENT FEE" by:

                  (i) deleting the word "and" at the end of CLAUSE (a) thereof;

                  (ii) adding immediately after the words "each day thereafter"
         in CLAUSE (b) thereof the words "to but excluding the First Amendment
         Date"; and

                  (iii) adding immediately following the table set forth
         therein, a new CLAUSE (C) to read as follows:

                  and (c) from and after the First Amendment Date, a fee which
                  shall accrue at a rate of 0.75% per annum.

         SECTION 2.3. SECTION 1.1 of the Credit Agreement is hereby further
amended by amending the definition of "APPLICABLE MARGIN" by:

                  (i) amending clause (a) thereof to read in its entirety as
         follows:

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                           (a) with respect to the unpaid principal amount of
                  each Term-B Loan maintained as a (i) Base Rate Loan, (x) prior
                  to the First Amendment Date, 2.50% per annum and (y) from and
                  after the First Amendment Date, 3.25% per annum and (ii) LIBO
                  Rate Loan, (x) prior to the First Amendment Date, 3.75% per
                  annum and (y) from and after the First Amendment Date, 4.50%
                  per annum;

                  (ii) deleting the word "and" at the end of CLAUSE (b) thereof;

                  (iii) adding immediately after the words "Compliance
         Certificate described in CLAUSE (B) above" in CLAUSE (c) thereof the
         words "to but excluding the First Amendment Date" and replacing the
         period at the end of CLAUSE (c) thereof with a colon; and

                  (iv) adding immediately after the table set forth therein a
         new CLAUSE (d) to read as follows:

                           (d) at all times on and after the First Amendment
                  Date, with respect to the unpaid principal amount of each (i)
                  Swing Line Loan, Committed Revolving Loan and Term-A Loan
                  maintained as a Base Rate Loan, 2.75% per annum, and (ii)
                  Committed Revolving Loan and Term-A Loan maintained as a LIBO
                  Rate Loan, 4.00% per annum.

         SECTION 2.4. SECTION 1.1 of the Credit Agreement is hereby further
amended by adding the word "Adjusted" immediately before the word "EBITDA" in
the definition of "FIXED CHARGE COVERAGE RATIO".

         SECTION 2.5. SECTION 1.1 of the Credit Agreement is hereby further
amended by deleting the second proviso at the end of the definition of "INTEREST
PERIOD" in its entirety and substituting therefor the following:

         PROVIDED, FURTHER, that the applicable Borrower shall not select an
         Interest Period longer than one month until after the date on which the
         Compliance Certificate for a four-Fiscal Quarter period ending after
         the Fiscal Quarter ending on or about March 31, 2002 reports EBITDA for
         such four-Fiscal Quarter period greater than $45,000,000.

         SECTION 2.6. SECTION 1.1 of the Credit Agreement is hereby further
amended by adding at the end of the definition of "UNRESTRICTED SUBSIDIARY" the
following sentence:

         Notwithstanding the foregoing, from and after the First Amendment Date,
         each Subsidiary of the Company shall be a Restricted Subsidiary, and
         the Company shall not have the right to designate any Subsidiary of the
         Company as an Unrestricted Subsidiary.

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<PAGE>   8

         SECTION 2.7. SECTION 1.1 of the Credit Agreement is hereby further
amended by adding thereto the following defined terms:

                  "ADJUSTED EBITDA" means, for any applicable period, the sum of
         EBITDA PLUS Supplemental EBITDA for such period.

                  "AMENDMENT NO. 1" means Amendment No. 1 to Second Amended and
         Restated Credit Agreement dated as of August __, 2001 among the
         Company, the Canadian Borrower, the Lenders party thereto, the
         Administrative Agent and the Syndication Agent.

                  "APPLICABLE TERM-C RATE" means at all times during the
         applicable periods set forth below,

                  (a) from the First Amendment Date to (but excluding) the date
         upon which the Compliance Certificate for the Fiscal Quarter ending on
         or about June 30, 2001 is delivered by the Company to the
         Administrative Agent pursuant to CLAUSE (c) of SECTION 7.1.1, 30.0% per
         annum; and

                  (b) at all times after the date of delivery of the Compliance
         Certificate described in CLAUSE (a) above, the rate determined by
         reference to the applicable Leverage Ratio set forth below:

                                                                Applicable
                         Leverage Ratio                         Term-C Rate
                         --------------                         -----------
                    greater than 6.0:1                             30.0%

                    greater than 5.0:1 but not
                    greater than 6.0:1                             25.0%

                    greater than 4.0:1 but not
                    greater than 5.0:1                             20.0%

                       less than or equal to 4.0:1                 15.0%

                  The Leverage Ratio used to compute the Applicable Term-C Rate
         for any day referred to in CLAUSE (b) above shall be the Leverage Ratio
         set forth in the Compliance Certificate most recently delivered by the
         Company to the Administrative Agent on or prior to such day pursuant to
         CLAUSE (c) of SECTION 7.1.1. Changes in the Applicable Term-C Rate
         resulting from a change in the Leverage Ratio shall become effective on
         the first day following delivery by the Company to the Administrative
         Agent of a new Compliance Certificate pursuant to CLAUSE (c) of SECTION
         7.1.1. If the Company shall fail to deliver a Compliance Certificate
         within the number of days after the end of any Fiscal Quarter as

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         required pursuant to CLAUSE (c) of SECTION 7.1.1 (without giving effect
         to any grace period), the Applicable Term-C Rate from and including the
         first day after the date on which such Compliance Certificate was
         required to be delivered to the date the Company delivers to the
         Administrative Agent the next Compliance Certificate shall conclusively
         equal the highest Applicable Term-C Rate set forth above.

                  "COLLATERAL DOCUMENTS" means each Pledge Agreement, the
         Canadian Collateral Documents, each Mortgage and each other security
         agreement, pledge agreement, mortgage, deed of trust, collateral
         assignment, financing statement or other agreement, document or
         instrument delivered in connection with this Agreement or any other
         Loan Document intended to create or evidence any Lien to secure the
         Obligations (other than Obligations owing to the Term-C Lenders);
         PROVIDED, HOWEVER, that the Holdco Guaranty and Pledge Agreement shall
         not be deemed to be a Collateral Document for purposes of the guaranty
         contained in Article III thereof or SECTIONS 5.6, 5.7, 5.8 and 5.9
         thereof.

                  "DEFERRED ACCRUAL DATE" means the date on which the Compliance
         Certificate for a Fiscal Quarter ending on or after December 31, 2002
         is delivered by the Company to the Administrative Agent pursuant to
         CLAUSE (c) of SECTION 7.1.1 and EBITDA for any period of two
         consecutive Fiscal Quarters during the four-Fiscal Quarter Period
         covered by such Compliance Certificate was greater than $38,000,000;
         PROVIDED, HOWEVER, that the Deferred Accrual Date shall not occur on
         any date on which a Default shall have occurred and be continuing.

                  "DEFERRED AMENDMENT FEE" means the fee, if any, determined in
         accordance with SECTION 3.3.4.

                  "DEFERRED INTEREST" means at any time the aggregate amount of
         interest accrued on Base Rate Loans and LIBO Rate Loans (other than
         Uncommitted Revolving Loans) pursuant to SECTION 3.2.1(d).

                  "DEFERRED LETTER OF CREDIT FEE" means at any time the letter
         of credit fee accrued pursuant to SECTION 3.3.3(b).

                  "DEFERRED PAYMENT ALLOCATION DATE" means the earlier to occur
         of the Deferred Accrual Date and the Deferred Payment Date.

                  "DEFERRED PAYMENT DATE" means the earliest of (i) the date on
         which all Obligations (other than principal of and accrued interest on
         the Term-C Loans) have been paid in full in cash, all Letters of Credit
         have been terminated, expired or Cash Collateralized, all Rate
         Protection Agreements have been terminated and all Commitments have
         been terminated, (ii) the date on which the Obligations are accelerated
         pursuant to SECTION 8.2 or 8.3, and (iii) the applicable Stated
         Maturity Date.

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                  "FIRST AMENDMENT DATE" means the effective date of Amendment
         No. 1.

                  "FUNDED INDEBTEDNESS" means the outstanding principal amount
         of all Indebtedness of the Company and its Restricted Subsidiaries that
         (i) is of the type referred to in CLAUSE (a) (PROVIDED, HOWEVER, that
         any Earn-Outs included in Indebtedness under such CLAUSE (A) shall be
         included as "Funded Indebtedness" at the after-tax amount thereof), (b)
         or (c), in each case of the definition of "Indebtedness" and (ii) any
         Contingent Liability in respect of any of the foregoing types of
         Indebtedness; PROVIDED, HOWEVER, that "Funded Indebtedness" shall not
         include (A) Deferred Interest, Deferred Letter of Credit Fees or
         Deferred Amendment Fees, (B) the Term-C Loans or deferred interest
         thereon or (C) the New Subordinated Notes or deferred interest thereon.

                  "INITIAL TERM-C LENDER" means each of the following:

                        DLJ Merchant Banking Partners II, L.P.
                        DLJ Merchant Banking Partners II-A, L.P.
                        DLJ Offshore Partners II, C.V.
                        DLJ Diversified Partners, L.P.
                        DLJ Diversified Partners-A, L.P.
                        DLJ Millenium Partners, L.P.
                        DLJ Millenium Partners-A, L.P.
                        DLJ EAB Partners, L.P.
                        DLJ ESC II, L.P.
                        Donaldson, Lufkin & Jenrette Securities Corporation (as
                        nominee for EMA 2001 Plan, L.P., DLJ First ESC, L.P.,
                        Paradeplatz 2001 Plan, L.P., Credit Suisse First Boston
                        Private Equity, Inc. and CSFB 2001 Investors, L.P.)

                  "NEW SUBORDINATED NOTE" means a note (an "INITIAL NOTE") in
         the form of EXHIBIT K hereto and any note issued in exchange for, or
         upon transfer of, any Initial Note (or any note so issued upon exchange
         or transfer), in each case in accordance with the terms of the Initial
         Notes or an indenture in the form of Exhibit A to the Initial Notes.

                  "NEW SUBORDINATED NOTES DOCUMENTS" means the New Subordinated
         Notes and all other instruments, agreements, indentures or other
         documents evidencing or governing any of the New Subordinated Notes or
         pursuant to which any New Subordinated Notes are issued.

                  "SUPPLEMENTAL EBITDA" means, for any Fiscal Quarter of the
         Company, the amount of Net Debt Proceeds deemed received by the Company
         during such Fiscal Quarter from the incurrence of additional Term-C
         Loans pursuant to SECTION 2.1.6 (b) and/or the sale or issuance of New
         Subordinated Notes (in each case calculated as if the term "Net Debt
         Proceeds" applied to such incurrence, sale

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         or issuance). The aggregate of Supplemental EBITDA for all Fiscal
         Quarters during the term of this Agreement shall not exceed
         $30,000,000. Such Net Debt Proceeds shall be deemed to have been
         received by the Company during a particular Fiscal Quarter to the
         extent that they are received on or prior to the tenth Business Day
         after the date on which the Company is required to deliver its
         Compliance Certificate pursuant to SECTION 7.1.1 (c) with respect to
         such Fiscal Quarter; PROVIDED, HOWEVER, that (i) if the Company intends
         to receive such Net Debt Proceeds after the date on which it delivers
         its Compliance Certificate for such Fiscal Quarter, it shall deliver a
         notice to such effect together with such Compliance Certificate and
         shall give the Administrative Agent written notice of the receipt of
         such Net Debt proceeds within one Business Day after such receipt, and
         (ii) any such Net Debt Proceeds counted as Supplemental EBITDA for a
         particular Fiscal Quarter shall not count as Supplemental EBITDA for
         any other Fiscal Quarter. Notwithstanding the foregoing, Net Debt
         Proceeds shall be deemed to have been received by the Company during
         any Fiscal Quarter at the end of which the Company is required to
         comply with the last paragraph of SECTION 7.1.1 only if the Company
         shall have received such Net Debt Proceeds, and shall have given the
         Administrative Agent written notice to such effect, not later than the
         second Business Day prior to the next interest payment date on the 1998
         Subordinated Notes.

                  "TERM-C COMMITMENT" means, with respect to each Initial Term-C
         Lender, such Initial Term-C Lender's commitment to make a Term-C Loan
         to the Company pursuant to SECTION 2.1.6 (a) in the amount set forth
         below opposite such Initial Term-C Lender's name:
<TABLE>
<CAPTION>

                            INITIAL TERM-C LENDER                      TERM-C COMMITMENT
                            ---------------------                      -----------------

<S>                                                                        <C>
                  DLJ Merchant Banking Partners II, L.P.                   $ 9,449,000
                  DLJ Merchant Banking Partners II-A, L.P.                 $   376,000
                  DLJ Offshore Partners II, C.V.                           $   465,000
                  DLJ Diversified Partners, L.P.                           $   552,000
                  DLJ Diversified Partners-A, L.P.                         $   205,000
                  DLJ Millenium Partners, L.P.                             $   153,000
                  DLJ Millenium Partners-A, L.P.                           $    30,000
                  DLJ EAB Partners, L.P.                                   $    42,000
                  DLJ ESC II, L.P.                                         $ 1,035,000
                  Donaldson, Lufkin & Jenrette Securities Corporation      $ 2,693,000
                  (as nominee for EMA 2001 Plan, L.P., DLJ First ESC,
                  L.P., Paradeplatz 2001 Plan, L.P., Credit Suisse First
                  Boston Private Equity, Inc. and CSFB 2001 Investors,
                  L.P.)
                                                                           -----------
                                                                           $15,000,000
</TABLE>

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<PAGE>   12

                  "TERM-C LENDERS" means, collectively, the Initial Term-C
         Lenders, any Person that shall make a Term-C Loan pursuant to SECTION
         2.16(b) and their respective successors and assigns as holders of the
         Term-C Loans from time to time.

                  "TERM-C LOAN" means a loan made pursuant to SECTION 2.16.

                  "TERM-C OBLIGATIONS" means the Obligations in respect of the
         Term-C Loans or any guaranty thereof (including, without limitation,
         pursuant to the Subsidiary Guaranty and the Holdco Guaranty and Pledge
         Agreement) or otherwise owing to the Term-C Lenders in their capacity
         as holders of the Term-C Loans, including, without limitation, rights
         to reimbursement of expenses pursuant to SECTION 11.3 and
         indemnification pursuant to SECTION 11.4.

         SECTION 2.8. SECTION 1.4(b) of the Credit Agreement is hereby amended
by adding at the end thereof the following sentence:

         Notwithstanding the foregoing, for any period ending after December 31,
         2001, such computations and calculations shall be made in accordance
         with the preceding sentence in the case of any Disposition, but not in
         the case of any acquisition.

         SECTION 2.9. SECTION 2.1.4 of the Credit Agreement is hereby amended by
deleting the period at the end of CLAUSE (e) thereof and substituting a
semicolon and the word "or" therefor and by adding a new CLAUSE (f) at the end
thereof to read as follows:

                  (f) any Uncommitted Revolving Loans on or after the First
         Amendment Date without the prior written consent of the Required
         Lenders.

         SECTION 2.10. SECTION 2.1 of the Credit Agreement is hereby amended by
adding at the end thereof a new SECTION 2.1.6 to read as follows:

                  SECTION 2.1.6. TERM-C LOANS.

                  (a) On the First Amendment Date, each Initial Term-C Lender
         shall make a Term-C Loan to the Company in a principal amount equal to
         the amount of such Initial Term-C Lender's Term-C Commitment by
         delivering to the Administrative Agent on such date same day funds in
         Dollars in such amount. To the extent such funds are received from the
         Initial Term-C Lenders, the Administrative Agent shall make such funds
         available to the Company by wire transfer to the account the Company
         shall have specified to the Administrative Agent in writing.

                                       12
<PAGE>   13

                  (b) From time to time on any Business Day occurring on or
         after the First Amendment Date but prior to the Stated Maturity date of
         the Term-C Loans, the Company may request in writing (with a copy to
         the Administrative Agent) that one or more of the Initial Term-C
         Lenders or any of their respective Affiliates that shall have been
         consented to by the Administrative Agent make additional Term-C Loans
         to it in an aggregate principal amount not to exceed $15,000,000. The
         Initial Term-C Lenders or any such Affiliate may, but shall have no
         obligation to, make such Loans. If and to the extent any Initial Term-C
         Lender or any such Affiliate agrees to make any such additional Term-C
         Loan, such Initial Term-C Lender or Affiliate shall deliver to the
         Administrative Agent on the date such additional Term-C Loan is to be
         made same day funds in Dollars in the principal amount of such
         additional Term-C Loan. To the extent such funds are received from such
         Initial Term-C Lender or Affiliate, the Administrative Agent shall make
         such funds available to the Company by wire transfer to the account the
         Company shall have specified to the Administrative Agent in writing.

         SECTION 2.11. SECTION 3.1.1(a)(i) of the Credit Agreement is hereby
amended (I) by deleting the word "and" at the end of CLAUSE (c) thereof, (ii) by
deleting the word "or" at the end of CLAUSE (d) thereof and substituting the
word "and" therefor and (iii) by adding a new CLAUSE (e) at the end thereof to
read as follows:

                  (E) so long as any Commitments or Obligations other than
         Term-C Obligations are outstanding, the Company may not voluntarily
         prepay any Term-C Loans, in whole or in part, or any accrued interest
         thereon without the prior written consent of the Required Lenders; or

         SECTION 2.12. SECTION 3.1.1(b) of the Credit Agreement is hereby
amended by deleting the percentage "50%" therein and substituting the percentage
"80%" therefor.

         SECTION 2.13. SECTION 3.1.1(c) of the Credit Agreement is hereby
amended by deleting the number "365" in both places such number appears therein
and substituting the number "90" therefor.

         SECTION 2.14. SECTION 3.1.1(d) of the Credit Agreement is hereby
amended by deleting the percentage "50%" therein and substituting the percentage
"100%" therefor and by deleting the ratio "3.50:1" therein and substituting the
ratio "2.25:1" therefor.

         SECTION 2.15. SECTION 3.1.1(g) of the Credit Agreement is hereby
amended (A) by deleting therefrom in its entirety the table of scheduled
principal repayments of the Term-B Loans and substituting the following
therefor:

                                                                   Scheduled
                           Period                            Principal Repayment
                           ------                            -------------------

                                       13
<PAGE>   14
                                                                   Scheduled
                           Period                            Principal Repayment
                           ------                            -------------------

                       First Amendment Date to (and
                           including) 10/15/06                        $375,000

                     10/16/06 to (but not including)
                       the Stated Maturity Date for
                               Term-B Loans
                                                                   $35,250,000

                           Stated Maturity Date                   $105,812,500

and (b) by adding at the end thereof a new paragraph to read as follows:

                  On the Stated Maturity Date for Term-C Loans, the Company
         shall repay the entire outstanding principal amount of, and all accrued
         and unpaid interest on, the Term-C Loans. The Company may not (either
         directly or indirectly through any of its Subsidiaries) voluntarily
         prepay, redeem or repurchase the Term-C Loans, in whole or in part, or
         any accrued interest thereon, prior to the Stated Maturity Date for
         Term-C Loans.

         SECTION 2.16. SECTION 3.1.1(h) of the Credit Agreement is hereby
amended by deleting the words "such excess;" at the end thereof and substituting
therefor the phrase "the excess of such sum over 100% of the Revolving Loan
Commitment Amount then in effect."

         SECTION 2.17. SECTION 3.1.2(b) of the Credit Agreement is hereby
amended in its entirety to read as follows:

                  (b) Each prepayment of Loans pursuant to CLAUSES (b), (c), (d)
         and (e) of SECTION 3.1.1 or CLAUSE (d) of this SECTION 3.1.2 shall be
         applied (i) FIRST, to the prepayment of Term Loans (other than Term-C
         Loans), until all Term Loans (other than Term-C Loans) shall have been
         repaid in full, (ii) SECOND, to the prepayment of Swing Line Loans,
         until all Swing Line Loans shall have been repaid in full, (iii) THIRD,
         to the prepayment of Revolving Loans, until all Revolving Loans shall
         have been repaid in full and (iv) FOURTH, to the Cash Collateralization
         of Letter of Credit Outstandings.

         SECTION 2.18. SECTION 3.1.2(c) of the Credit Agreement is hereby
amended in its entirety to read as follows:

                  (c) Each prepayment of Term Loans made pursuant to CLAUSES
         (a), (b), (c), (d) and (e) of SECTION 3.1.1 shall be applied, (i)
         except in the case of a payment made pursuant to the last sentence of
         SECTION 3.1.3, on a pro rata basis, to the outstanding principal amount
         of all remaining Term-A Loans and Term-B Loans

                                       14
<PAGE>   15

         (PROVIDED, HOWEVER, that prepayments of Term-B Loans shall be applied,
         FIRST, to Initial U.S. Term-B Loans and Additional Term-B Loans until
         all Initial U.S. Term-B Loans and Additional Term-B Loans have been
         repaid in full and, SECOND, to Initial Canadian Term-B Loans) and (ii)
         in respect of each Tranche of Term Loans, in inverse order of maturity
         of the remaining scheduled principal payments in respect thereof, until
         all such Term-A Loans and Term-B Loans have been repaid in full;
         PROVIDED, HOWEVER, that if the Company at any time elects in writing,
         in its sole discretion, to permit any Lender that has Term-B Loans to
         decline to have such Loans prepaid, then any Lender having Term-B Loans
         outstanding may, by delivering a notice to the Agents at least one
         Business Day prior to the date that such prepayment is to be made,
         decline to have such Loans prepaid with the amounts set forth above, in
         which case 100% of the amounts that would have been applied to a
         prepayment of such Lender's Term-B Loans, shall instead be applied to a
         prepayment of the Term-A Loans (until paid in full).

         SECTION 2.19. SECTION 3.1.2(d) of the Credit Agreement is hereby
amended by inserting therein immediately after the words "Term Loans" in each
place such words appear therein the parenthetical phrase "(other than the Term-C
Loans)".

         SECTION 2.20. SECTION 3.2.1 of the Credit Agreement is hereby amended
by adding at the end thereof new CLAUSES (d), (e) and (f) read as follows:

                  (d) In addition to interest at the applicable rate set forth
         in CLAUSES (a) and (b) above, each Base Rate Loan and each LIBO Rate
         Loan (in each case other than an Uncommitted Revolving Loan) in any
         currency shall accrue interest on the unpaid principal amount thereof
         for each day from and including July 1, 2001 to but excluding the
         earlier of the Deferred Accrual Date and the date such Loan is repaid
         at the rate of 2% per annum.

                  (e) As of the Deferred Payment Allocation Date, the total sum
         of each Lender's (other than Term-C Lenders) Deferred Interest,
         Deferred Letter of Credit Fee and Deferred Amendment Fee on such date
         shall, if such date is not the Deferred Payment Date, be payable on the
         Stated Maturity Date applicable to such Lender's Loans and shall in any
         event bear interest from the Deferred Payment Allocation Date until
         paid in full at a per annum rate from time to time equal to the LIBO
         Rate (Reserve Adjusted) for successive one-month Interest Periods
         commencing on the Deferred Payment Allocation Date plus 4.00% per
         annum.

                  (f) Each Term-C Loan shall accrue interest on the unpaid
         principal amount thereof for each day from and including the day upon
         which such Term-C Loan was made to but excluding the date such Term-C
         Loan is repaid at a rate per annum equal to the Applicable Term-C Rate
         on such day. As of each Quarterly Payment Date, all accrued and unpaid
         interest on the Term-C Loans and on any deferred interest theretofore
         accrued shall be deemed to be deferred interest, and

                                       15
<PAGE>   16

         interest shall thereafter accrue on such deferred interest for each day
         from and including such Quarterly Payment Date to but excluding the
         date such deferred interest is repaid at a rate per annum equal to the
         Applicable Term-C Rate on such day.

         SECTION 2.21. SECTION 3.2.2 of the Credit Agreement is hereby amended
in its entirety to read as follows:

                  SECTION 3.2.2. POST-MATURITY AND POST-DEFAULT RATES.

                  (a) After the date any principal amount of any Loan (other
         than a Term-C Loan) shall have become due and payable (whether on the
         applicable Stated Maturity Date, upon acceleration or otherwise), or
         any other monetary Obligation (other than accrued interest, including
         deferred interest, on Term-C Loans, and other than overdue
         Reimbursement Obligations which shall bear interest as provided in
         SECTION 2.6.2) of any Borrower shall have become due and payable, the
         applicable Borrower shall pay, but only to the extent permitted by law,
         interest (after as well as before judgment) on such amounts at a rate
         per annum equal to (a) in the case of any overdue principal of Loans,
         overdue interest thereon, overdue commitment fees or other overdue
         amounts in respect of Loans or other obligations (or the related
         Commitments) under a particular Tranche, the rate that would otherwise
         be applicable to Base Rate Loans (or, in the case of Foreign Currency
         Loans denominated in a Foreign Currency other than Canadian Dollars,
         LIBO Rate Loans having an Interest Period of one month beginning on the
         date such amount shall have become due or the last day of the prior
         Interest Period applicable thereto) under such Tranche pursuant to
         SECTION 3.2.1 plus 2% per annum, (b) in the case of Uncommitted
         Revolving Loans, the rate that would otherwise be applicable to such
         Loans pursuant to CLAUSE (c) of SECTION 3.2.1 plus 2% per annum, and
         (c) in the case of other overdue monetary Obligations, the rate that
         would otherwise be applicable to Revolving Loans maintained as Base
         Rate Loans pursuant to SECTION 3.2.1 plus 2% per annum.

                  (b) During the continuance of an Event of Default, the
         Required Lenders may, at their option, by notice to the Borrowers,
         declare that each outstanding Loan (other than Term-C Loans) shall bear
         interest at a rate equal to the rate otherwise applicable thereto plus
         2% per annum (but without duplication with respect to overdue principal
         of Loans or other overdue monetary Obligations to which CLAUSE (A)
         above shall apply).

         SECTION 2.22. SECTION 3.2.3 of the Credit Agreement is hereby amended
by adding at the end thereof a new sentence to read as follows:

         Notwithstanding anything to the contrary contained in this SECTION
         3.2.3, Deferred Interest shall be payable on the Deferred Payment Date.

                                       16
<PAGE>   17

         SECTION 2.23. SECTION 3.3.3 of the Credit Agreement is hereby amended
by designating the existing SECTION 3.3.3 as CLAUSE (a) thereof, by deleting the
percentage "1.25%" therein and substituting the percentage "2.00%" therefor, and
by adding thereto new CLAUSES (B) and (C) to read follows:

                  (b) In addition to the letter of credit fee at the applicable
         rate set forth in CLAUSE (a) above, each Borrower that shall have
         requested the issuance of a Letter of Credit agrees to pay to the
         Administrative Agent, for the PRO RATA account of the applicable Issuer
         and each other Lender that has a Revolving Loan Commitment, a letter of
         credit fee, in Dollars, for each day from and including July 1, 2001 to
         but excluding the Deferred Accrual Date on which there shall be any
         Letters of Credit requested by it outstanding, with respect to each
         Letter of Credit requested by it, at the rate of 2% per annum on the
         Dollar Equivalent of the Stated Amount of each such Letter of Credit
         outstanding on such day, such fees being payable on the Deferred
         Payment Date.

                  (c) During the continuance of an Event of Default, the
         Required Lenders may, at their option, by notice to the Borrowers,
         declare that the letter of credit fee set forth in CLAUSE (a) above
         shall be increased by 2% per annum.

         SECTION 2.24. SECTION 3.3 of the Credit Agreement is hereby further
amended by adding at the end thereof a new SECTION 3.3.4 to read as follows:

                  SECTION 3.3.4. DEFERRED AMENDMENT FEE. If, as of the Deferred
         Payment Allocation Date, the sum of the Deferred Interest and the
         Deferred Letter of Credit Fee payable on such date is less than
         $7,000,000, the Company agrees to pay to the Administrative Agent, for
         the account of each Lender (other than the Term-C Lenders) in
         accordance with its Aggregate Pro Rata Share as of the Deferred Payment
         Allocation Date, a deferred amendment fee equal to the amount by which
         $7,000,000 exceeds such sum, such fee being payable on the Deferred
         Payment Date.

         SECTION 2.25. SECTION 4.8(c) of the Credit Agreement is hereby amended
by adding immediately after the word "Lenders" each place such word appears
therein the parenthetical phrase "(other than the Term-C Lenders)".

         SECTION 2.26. SECTION 4.9 of the Credit Agreement is hereby amended by
adding immediately after the words "Each Lender" and "each Lender" each place
such words appear therein the parenthetical phrase "(other than the Term-C
Lenders)".

         SECTION 2.27. SECTION 6.6 of the Credit Agreement is hereby amended by
deleting the date "March 31, 2000" therein and substituting the date "June 30,
2001" therefor.

         SECTION 2.28. SECTION 6.8 of the Credit Agreement is hereby amended in
its entirety to read as follows:

                                       17
<PAGE>   18

                  SECTION 6.8. SUBSIDIARIES. The Company has only those
         Subsidiaries (a) which are identified in AMENDED ITEM 6.8 ("Existing
         Subsidiaries") of the Disclosure Schedule, or (b) which are permitted
         to have been acquired in accordance with SECTION 7.2.5 or 7.2.8. As of
         the First Amendment Date, the Company has only those Subsidiaries which
         are identified in AMENDED ITEM 6.8 of the Disclosure Schedule.

         SECTION 2.29. SECTION 7.1.1 of the Credit Agreement is hereby amended
(a) by amending CLAUSES (a) and (b) thereof in their entirety to read as
follows:

                  (a) as soon as available and in any event within 45 days after
         the end of each of the first three Fiscal Quarters of each Fiscal Year
         of the Company (or, if the Company is required to file such information
         on a Form 10-Q with the Securities and Exchange Commission, promptly
         following such filing), consolidated and consolidating (on a business
         segment basis) balance sheets of the Company and its Subsidiaries as of
         the end of such Fiscal Quarter, together with the related consolidated
         and consolidating (on a business segment basis) statement of operations
         for such Fiscal Quarter and the related consolidated and consolidating
         (on a business segment basis) statements of operations and cash flows
         for the period commencing at the end of the previous Fiscal Year and
         ending with the end of such Fiscal Quarter (it being understood that
         the foregoing requirement (other than with respect to consolidating
         statements) may be satisfied by delivery of the Company's report to the
         Securities and Exchange Commission on Form 10-Q, if any), certified by
         an Authorized Officer that is the president, chief executive officer,
         treasurer, assistant treasurer, controller or chief financial or
         accounting officer of the Company;

                  (b) as soon as available and in any event within 90 days after
         the end of each Fiscal Year of the Company (or, if the Company is
         required to file such information on a Form 10-K with the Securities
         and Exchange Commission, promptly following such filing), a copy of the
         annual audit report for such Fiscal Year for the Company and its
         Subsidiaries, including therein a consolidated balance sheet for the
         Company and its Subsidiaries as of the end of such Fiscal Year,
         together with the related consolidated statements of operations and
         cash flows for such Fiscal Year (it being understood that the foregoing
         requirement may be satisfied by delivery of the Company's report to the
         Securities and Exchange Commission on Form 10-K, if any), in each case
         certified (without any Impermissible Qualification) by KPMG LLP or
         another "Big Five" firm of independent public accountants, together
         with (i) a certificate from such accountants as to whether, in making
         the examination necessary for the signing of their report on such
         annual report by such accountants, they have become aware of any
         Default in respect of any term, covenant, condition or other provision
         of this Agreement (including any Default in respect of any of the
         financial covenants contained in Section 7.2.4) that relates to
         accounting matters that has occurred and is continuing or, if in the
         opinion of such accounting firm such a Default has

                                       18
<PAGE>   19

         occurred and is continuing, a statement as to the nature thereof, and
         (ii) a consolidating (on a business segment basis) balance sheet for
         the Company and its Subsidiaries as of the end of such Fiscal Year,
         together with the related consolidating (on a business segment basis)
         statements of operations and cash flows for such Fiscal Year.

and (b) by redesignating CLAUSE (i) thereof as CLAUSE (k) and adding thereto
immediately after CLAUSE (h) thereof new CLAUSES (i) and (j) to read as follows:

                  (i) as soon as available and in any event within 30 days after
         the end of each of the first two Fiscal Months of each Fiscal Quarter
         of the Company, consolidated and consolidating (on a business segment
         basis) balance sheets of the Company and its Subsidiaries as of the end
         of such Fiscal Month, together with the related consolidated and
         consolidating (on a business segment basis) statements of operations
         for such Fiscal Month and the related consolidated and consolidating
         (on a business segment basis) statements of operations and cash flows
         for the period commencing at the end of the previous Fiscal Year and
         ending with the end of such Fiscal Month, certified by an Authorized
         Officer that is the president, chief executive officer, treasurer,
         assistant treasurer, controller or chief financial or accounting
         officer of the Company;

                  (j) as soon as available and in any event written 20 days
         after the end of each Fiscal Month of the Company, (A) a cash
         management report showing the location of all deposit accounts in which
         cash is maintained, cash balances by business segment as of the end of
         such Fiscal Month, and the changes in such cash balances from the end
         of the previous Fiscal Month, and (B) a cash forecast for the three
         Fiscal Months following such Fiscal Months, in each case such report or
         forecast to be in a form reasonably acceptable to the Administrative
         Agent; PROVIDED, HOWEVER, that if any cash management report shows that
         the sum of total cash as of the date such report plus the unused
         portion of the Revolving Loan Commitment Amount (net of Letter of
         Credit Outstandings) as of such date is less than $8,000,000, the
         Company shall thereafter furnish such cash management report on a
         weekly basis within 10 days after the end of each week until the
         Company shall deliver a cash management report showing that such
         condition has been rectified as of the date of such subsequent report;
         and

         SECTION 2.30. SECTION 7.1.1 of the Credit Agreement is hereby further
amended by adding at the end thereof a new paragraph to read as follows:

                  The Company further agrees that (x) if the Company shall not
         have complied with CLAUSE (a) above within 40 days after the end of the
         Fiscal Quarter ending on or about June 30 in any Fiscal Year, then the
         Company shall, within such 40 days, deliver to the Administrative Agent
         preliminary (but complete, except with respect to notes) copies of the
         consolidated financial statements required by CLAUSE (a) (which may be
         a draft of the Company's report on Form

                                       19
<PAGE>   20

         10-Q) together with a preliminary (but completed) Compliance
         Certificate; and (y) within 40 days after the end after the end of each
         Fiscal Year of the Company, the Company shall deliver to the
         Administrative Agent preliminary (but complete, except with respect to
         notes) copies of the consolidated financial statements required by
         CLAUSE (b) above together with a preliminary (but completed) Compliance
         Certificate. The delivery of such preliminary copies shall not relieve
         the Company from its obligation to provide the final documents required
         by CLAUSES (a), (b) and (c) above within the periods set forth therein.
         The Administrative Agent shall be entitled to rely on a preliminary
         Compliance Certificate delivered pursuant to CLAUSE (x) or (y) above
         that shows the existence of a Default as the basis for delivery of a
         payment blockage notice pursuant to Section 13.03 of the 1998
         Subordinated Note Indenture, but for all other purposes of this
         Agreement (including the following sentence), a reference to a
         Compliance Certificate shall mean a final Compliance Certificate
         delivered pursuant to CLAUSE (c) above. After the date on which a
         Compliance Certificate reports EBITDA greater than $55,700,000 for a
         four-Fiscal Quarter period, the Company shall no longer be required to
         comply with CLAUSE (y) above.

         SECTION 2.31. SECTION 7.2.2 of the Credit Agreement is hereby amended
by adding the word "and" at the end of CLAUSE (I) thereof and immediately
thereafter adding a new CLAUSE (J) thereto to read as follows:

                  (j) Indebtedness evidenced by New Subordinated Notes of the
         Company in an aggregate principal amount (excluding accrued and unpaid
         interest, whether or not deferred) not to exceed $15,000,000 at any
         time outstanding;

         SECTION 2.32. SECTION 7.2.3 of the Credit Agreement is hereby amended
by adding immediately after the word "Obligations" in CLAUSE (b) thereof the
parenthetical phrase "(other than Term-C Obligations)".

         SECTION 2.33. SECTION 7.2.4 of the Credit Agreement is hereby amended
and restated in its entirety to read as follows:

                  SECTION 7.2.4. FINANCIAL COVENANTS.

                           (a) ADJUSTED EBITDA. The Company will not permit
                  Adjusted EBITDA for the period of four consecutive Fiscal
                  Quarters ending on the last day of any Fiscal Quarter to be
                  less than the amount set forth below opposite such Fiscal
                  Quarter:

                               Fiscal Quarter                   Adjusted
                             Ending on or about                  EBITDA
                             ------------------                  ------
                                  9/30/01                     $30,000,000
                                  12/31/01                    $12,000,000

                                       20
<PAGE>   21

                                  3/31/02                     $10,000,000
                                  6/30/02                     $18,000,000
                                  9/30/02                     $27,000,000
                                  12/31/02                    $37,000,000
                                  3/31/03                     $40,000,000
                                  6/30/03                     $43,000,000
                                  9/30/03                     $44,000,000
                                  12/31/03                    $45,000,000
                                  3/31/04                     $46,000,000
                                  6/30/04                     $47,500,000
                                  9/30/04                     $49,000,000
                                  12/31/04                    $50,000,000
                                  3/31/05                     $52,000,000
                                  6/30/05                     $53,000,000
                                  9/30/05                     $55,000,000
                                  12/31/05                    $56,000,000
                                  3/31/06                     $58,000,000
                                  6/30/06                     $59,000,000
                                  9/30/06                     $60,000,000
                                  12/31/06                    $65,000,000
                                 Thereafter                   $68,000,000

                  The foregoing schedule shall be modified automatically for
         periods ending after December 31, 2003 as follows: If the Compliance
         Certificate delivered pursuant to SECTION 7.1.1(c) with respect to any
         Fiscal Year financial statements, beginning with the Fiscal Year ending
         December 31, 2003, reports EBITDA in an amount exceeding 125% of the
         scheduled minimum Adjusted EBITDA for such Fiscal Year set forth above,
         then for each Fiscal Quarter ending after such Fiscal Year, the minimum
         Adjusted EBITDA shall be the greater of (i) the scheduled minimum
         Adjusted EBITDA set forth above with respect to such Fiscal Quarter and
         (ii) an amount equal to the lesser of (A) 80% of EBITDA reported for
         the period of four consecutive Fiscal Quarters ended on the last day of
         the Fiscal Quarter immediately prior to such Fiscal Quarter and (B)
         $72,000,000.

                                       21
<PAGE>   22

                  (b) FUNDED INDEBTEDNESS. The Company will not permit Funded
         Indebtedness at any time during any period set forth below to be
         greater than the amount set forth opposite such period:

                                   Period                    Funded Indebtedness
                                   ------                    -------------------
                  6/30/01 through and including the last
                  day of the Fiscal Quarter ending
                  12/31/02                                       $355,000,000

                  1/1/03 through and including the last
                  day of the Fiscal Quarter ending
                  12/31/03                                       $350,000,000

                  1/1/04 through and including the last
                  day of the Fiscal Quarter ending
                  12/31/04                                       $340,000,000

                  1/1/05 through and including the last
                  day of the Fiscal Quarter ending
                  12/31/05                                       $330,000,000

                  1/1/06 through and including the last
                  day of the Fiscal Quarter ending
                  12/31/06                                       $320,000,000

                  Thereafter                                     $315,000,000

                  (c) FIXED CHARGE COVERAGE RATIO. The Company will not permit
         the Fixed Charge Coverage Ratio as of the end of any Fiscal Quarter
         ending on or after December 31, 2003 to be less than 1.00:1.

         SECTION 2.34. SECTION 7.2.5 of the Credit Agreement is hereby amended
as follows:

         (a) CLAUSE (b) of SECTION 7.2.5 is amended by adding at the end thereof
the following:

         PROVIDED, HOWEVER, that from and after the date that is 30 days after
         the First Amendment Date, Cash Equivalent Investments of the Company
         and its U.S. Subsidiaries in excess of $8,000,000 in the aggregate at
         any time shall not be

                                       22
<PAGE>   23

         permitted unless such Cash Equivalent Investments are held or
         maintained in accounts at Bank One or an Affiliate of Bank One and
         subject to a first priority perfected security interest in favor of
         the Administrative Agent pursuant to Collateral Documents in form and
         substance reasonably satisfactory to the Administrative Agent;

         (b) CLAUSES (e), (g) and (k) of SECTION 7.2.5 are deleted in their
entirety and in each case "[intentionally omitted]" substituted therefor;

         (c) CLAUSES (o) and (q) of SECTION 7.2.5 are each amended by adding at
the end of each thereof the following:

         PROVIDED, HOWEVER, that no such Investment shall be made on or after
the First Amendment Date;

         (d) CLAUSE (p) of SECTION 7.2.5 is deleted in its entirety and
"[intentionally omitted]" substituted therefor.

         SECTION 2.35. SECTION 7.2.6 of the Credit Agreement is hereby amended
by deleting CLAUSE (c) thereof in its entirety and substituting "[intentionally
omitted]" therefor.

         SECTION 2.36. SECTION 7.2.7 of the Credit Agreement is hereby amended
by amending CLAUSE (a) thereof in its entirety to read as follows:

                  (a) The Company will not, and will not permit any Restricted
         Subsidiary to, make or commit to make Capital Expenditures in any
         Fiscal Year ending on or after December 31, 2001, except Capital
         Expenditures of the Company and the Restricted Subsidiaries not to
         exceed $8,000,000 in the aggregate in the case of any Fiscal Year
         ending on or prior to December 31, 2004, and $10,000,000 in the
         aggregate in the case of any Fiscal year ending after December 31,
         2004; PROVIDED, HOWEVER, that (i) if any Compliance Certificate
         delivered pursuant to SECTION 7.1.1 (c) reports EBITDA greater than
         $45,000,000 but less than or equal to $55,000,000 for the four-Fiscal
         Quarter period covered by such Compliance Certificate, then maximum
         permitted Capital Expenditures for the Fiscal Year in which such
         four-Fiscal Quarter period ends (or, if such period is a Fiscal Year,
         then for the following Fiscal Year) shall be $10,000,000, and (ii) if
         any Compliance Certificate delivered pursuant to SECTION 7.1.1(c)
         reports EBITDA greater than $55,000,000 for the four-Fiscal Quarter
         period covered by such Compliance Certificate, then maximum permitted
         Capital Expenditures for the Fiscal Year in which such four-Fiscal
         Quarter period ends (or, if such period is a Fiscal Year, then for the
         following Fiscal Year) shall be $12,000,000.

         SECTION 2.37. SECTION 7.2.10 of the Credit Agreement is hereby amended
in its entirety to read as follows:

                                       23
<PAGE>   24

                  SECTION 7.2.10. MODIFICATION OF CERTAIN AGREEMENTS. The
         Company will not, and will not permit any of its Restricted
         Subsidiaries to, consent to any amendment, supplement, amendment and
         restatement, waiver or other modification of any of the terms or
         provisions contained in, or applicable to, the Transaction Agreement,
         the Investors' Agreement, the 1998 Subordinated Note Documents or the
         New Subordinated Note Documents or any schedules, exhibits or
         agreements related thereto (the "RESTRICTED AGREEMENTS"), in each case
         which would materially adversely affect the rights or remedies of the
         Lenders, or any Obligor's ability to perform under any Loan Document or
         which would (a) decrease the cash consideration payable in respect of
         the Divestiture, (b) increase the Company's or any Restricted
         Subsidiary's obligations or liabilities, contingent or otherwise (other
         than adjustments to the cash consideration payable in respect of the
         Divestiture made pursuant to the terms of such Transaction Agreement),
         (c) increase the principal amount of, or increase the interest rate on,
         or add or increase any fee with respect to the Indebtedness evidenced
         by the 1998 Subordinated Notes, the New Subordinated Notes or any such
         Restricted Agreement, advance any dates upon which payments of
         principal or interest are due thereon or change any of the covenants
         with respect thereto in a manner which is more restrictive to the
         Borrower or any of its Restricted Subsidiaries or (d) in the case of
         any 1998 Subordinated Notes Documents or any New Subordinated Note
         Documents, change the subordination provisions thereof (including any
         default or conditions to an event of default relating thereto), or
         change any collateral therefor (other than to release such collateral),
         if (in the case of this CLAUSE (d)), the effect of such amendment or
         change, individually or together with all other amendments or changes
         made, is to increase the obligations of the obligor thereunder or to
         confer any additional rights on the holders of the 1998 Subordinated
         Notes, the New Subordinated Notes or any such Restricted Agreement (or
         a trustee or other representative on their behalf)

         SECTION 2.38. SECTION 7.2.11 of the Credit Agreement is hereby amended
by adding at the end of CLAUSE (c) thereof a new proviso to read as follows:

         PROVIDED, HOWEVER, that payments in respect of such obligations to DLJ
         Merchant Banking II, Inc. and its successors and assigns shall not
         exceed $250,000 in the aggregate during any twelve-month period,

         SECTION 2.39. SECTION 7.2 of the Credit Agreement is hereby further
amended by adding at the end thereof two new subsections to read as follows:

                  SECTION 7.2.16. CONTINGENT PAYMENTS. The Company will not, and
         will not permit any Restricted Subsidiary to, enter into any contract
         or agreement with, or otherwise become obligated to, any Person for
         professional financial advisory, restructuring, investment banking or
         other similar services providing for actual and/or contingent payments
         by the Company and/or any Restricted Subsidiary in excess of $2,000,000
         in the aggregate.

                                       24
<PAGE>   25

                  SECTION 7.2.17. PREPAYMENTS. The Company will not, and will
         not permit any Restricted Subsidiary to, either directly or indirectly,
         voluntarily redeem, retire or otherwise pay or defease prior to their
         scheduled maturity, or accelerate the maturity of, the 1998
         Subordinated Notes or the New Subordinated Notes.

         SECTION 2.40. SECTION 8.1.4 of the Credit Agreement is hereby amended
by deleting therefrom the words "at the direction of" and substituting the word
"or" therefor.

         SECTION 2.41. SECTION 8.3 of the Credit Agreement is hereby amended by
adding at the end thereof the following sentences:

         Anything in this SECTION 8.3 to the contrary notwithstanding, if the
         Administrative Agent shall declare any portion of the Revolving Loans,
         Term-A Loans or Term-B Loans outstanding to be due and payable, or
         require any Borrower to Cash Collateralize any Letter of Credit
         Outstandings, in any such case pursuant to this SECTION 8.3, it shall,
         unless consented to in writing by Term-C Lenders holding at least 51%
         of the aggregate principal amount of Term-C Loans then outstanding,
         declare an equal portion of the Term-C Loans outstanding to be due and
         payable. Upon and after the acceleration of any Term-C Obligations
         pursuant to this SECTION 8.3, (i) each Term-C Lender shall have the
         right to seek payment directly from the Company or any other Obligor
         with respect to such Term-C Obligations that have become due and
         payable and to pursue any available remedies to enforce payment of its
         Term-C Obligations, and (ii) neither the Administrative Agent nor any
         Lender other than the Term-C Lenders shall be required to pay to or
         share with any Term-C Lender any portion of any payment or other
         recovery the Administrative Agent or such other Lender receives
         pursuant to this Agreement or any other Loan Document or otherwise
         applies to any of the Obligations other than the Term-C Obligations.

         SECTION 2.42. SECTION 9.9 of the Credit Agreement is hereby amended in
its entirety to read as follows:

                  SECTION 9.9. CO-DOCUMENTATION AGENTS, ETC. Notwithstanding
         anything else to the contrary contained in this Agreement or any other
         Loan Document, neither the Lead Arranger nor any Lender identified on
         the signature pages of this Agreement as the "Syndication Agent" or a
         "Co-Documentation Agent" shall have any right, power, obligation,
         liability, responsibility or duty under this Agreement (or any other
         Loan Document) other than those applicable to all Lenders as such.
         Without limiting the foregoing, the Lenders so identified as the
         "Syndication Agent" or a "Co-Documentation Agent" shall not have or be
         deemed to have any fiduciary relationship with any other Lender. Each
         Lender acknowledges that it has not relied, and will not rely, on any
         Lender so identified as the "Syndication Agent" or a "Co-Documentation
         Agent" in deciding to enter

                                       25
<PAGE>   26

         into this Agreement and each other Loan Document to which it is a party
         or in taking or not taking action hereunder or thereunder.

         SECTION 2.43. SECTION 9.11 of the Credit Agreement is hereby amended by
adding immediately after the words "Lender Party" and "Lender Parties" in each
place such words appear therein the parenthetical phrase "(other than the Term-C
Lenders)".

         SECTION 2.44. SECTION 11.1(a) of the Credit Agreement is hereby amended
by adding at the end thereof the following proviso:

         ; PROVIDED, HOWEVER, that the release of all or substantially all of
         the Collateral shall not require the consent of any Term-C Lender.

         SECTION 2.45. SECTION 11.1(c) of the Credit Agreement is hereby amended
by adding thereto, immediately after the words "any Loan or any Reimbursement
Obligation" in the second place such words appear therein and prior to the
comma, the words "or change the currency in which any Loan or any Reimbursement
Obligation is payable".

         SECTION 2.46. SECTION 11.1(e) of the Credit Agreement is hereby amended
in its entirety to read as follows:

                  (e) No such amendment, modification or waiver shall be
         effective if it would amend, modify or waive the provisions of CLAUSE
         (a)(i) of SECTION 3.1.1 or CLAUSE (b) of SECTION 3.1.2 or effect any
         amendment, modification or waiver that by its terms adversely affects
         the rights of Lenders participating in any Tranche (other than the
         Tranche consisting of Term-C Loans) differently from those of Lenders
         participating in other Tranches, unless such amendment, modification or
         waiver shall have been consented to by the holders of at least 51% of
         the aggregate amount of Loans outstanding under the Tranche or Tranches
         (other than the Tranche consisting of Term-C Loans) affected by such
         modification, or, in the case of a modification affecting the Revolving
         Loan Commitments, the Lenders holding at least 51% of the Revolving
         Loan Commitments.

         SECTION 2.47. SECTION 11.1 of the Credit Agreement is hereby further
amended by adding immediately after CLAUSE (e) thereof a new CLAUSE (f) to read
as follows:

                  (f) No such amendment, modification or waiver of any Loan
         Document other than a Collateral Document shall be effective if it
         would (i) modify the last two sentences of SECTION 8.3 or (ii) by its
         terms expressly impose any additional obligation on, or change or
         condition any rights of, the Term-C Lenders without imposing such
         additional obligation on, or so changing or conditioning the rights of,
         the other Lenders, unless, in each such case, such amendment,
         modification or waiver shall have been consented to by the holders of
         at least 51% of the aggregate principal amount of Term-C Loans
         outstanding.

                                       26
<PAGE>   27

         SECTION 2.48. SECTION 11.3 of the Credit Agreement is hereby amended by
adding a sentence at the end thereof to read as follows:

         Notwithstanding anything contained in this SECTION 11.3 to the
         contrary, any reimbursement or other payment by the Company pursuant to
         this SECTION 11.3 to any Term-C Lender shall be payable on the earliest
         of (i) the Stated Maturity Date for Term-C Loans, (ii) the date upon
         which all principal of and interest on the Term-C Loans is paid in full
         and (iii) the date on which any Term-C Obligations are accelerated
         pursuant to SECTION 8.3; PROVIDED, HOWEVER, that this sentence shall
         not apply to any Person to the extent that such Person has a right to
         reimbursement from the Company in any capacity other than as a Term-C
         Lender.

         SECTION 2.49. SECTION 11.4 of the Credit Agreement is hereby amended by
adding a sentence at the end thereof to read as follows:

         Notwithstanding anything contained in this SECTION 11.4 to the
         contrary, any indemnification or other payment by the Company pursuant
         to this SECTION 11.4 to any Term-C Lender or any Affiliate of a Term-C
         Lender, or any of their respective partners, officers, directors,
         employees or agents, or any other Person controlling any of the
         foregoing within the meaning of either Section 15 of the Securities Act
         of 1933, as amended, or Section 20 of the Securities Exchange Act of
         1934, as amended, shall be due and payable on the earliest of (i) the
         Stated Maturity Date for the Term-C Loans, (ii) the date upon which all
         principal of and interest on the Term-C Loans is paid in full and (iii)
         the date on which any Term-C Obligations are accelerated pursuant to
         SECTION 8.3; PROVIDED, HOWEVER, that this sentence shall not apply to
         any such Indemnified Party to the extent that its right to
         indemnification arises other than as a Term-C Lender or by virtue of
         its relationship to a Term-C Lender.

         SECTION 2.50. SECTION 11.11.1 of the Credit Agreement is hereby amended
by amending CLAUSE (a) thereof in its entirety to read as follows:

                  (a) with the written consents of the Administrative Agent and
         (in the case of any assignment of participations in Letters of Credit
         or Revolving Loan Commitments) the Issuers (which consents (i) shall
         not be unreasonably delayed or withheld and (ii) shall not be required
         in the case of assignments made by DLJ or any of its Affiliates), may
         at any time assign and delegate to one or more commercial banks, funds
         that are regularly engaged in making, purchasing or investing in loans
         or securities, or other financial institutions, and

         SECTION 2.51. The Disclosure Schedule to the Credit Agreement is hereby
amended by amending ITEMS 6.8 (Existing Subsidiaries), 7.2.2(a)(i) (Ongoing
Indebtedness), 7.2.3(a) (Ongoing Liens) and 7.2.5(A) (Ongoing Investments) in
their entirety as set forth in the Disclosure Schedules attached hereto.

                                       27
<PAGE>   28

         SECTION 2.52. The Credit Agreement is hereby further amended by
deleting EXHIBITS E (Form of Compliance Certificate) and I (Form of Lender
Assignment Agreement) thereto in their entirety and substituting therefor
AMENDED EXHIBITS E and I, respectively, attached hereto, and by adding thereto a
new EXHIBIT A-5 (Form of Term-C Note) in the form of EXHIBIT A-5 attached hereto
and a new EXHIBIT K (Form of New Subordinated Note) in the form of EXHIBIT K
attached hereto.

         SECTION 3. WAIVER. Upon the effectiveness of this Amendment in
accordance with the provisions of SECTION 4 below, the Lenders hereby
specifically waive the violation of SECTIONS 7.2.4(a), (b) and (c) of the Credit
Agreement and any Default caused thereby to the extent such violation or Default
was caused by the Company's failure to maintain the Leverage Ratio, the Interest
Coverage Ratio and the Fixed Charge Coverage Ratio as of the end of the Fiscal
Quarter ended on or about June 30, 2001. This specific waiver applies only to
the above-specified violation and Default and only during the period from June
30, 2001 through the date hereof. This specific waiver is limited to the express
circumstances described herein and shall not be construed to constitute (i) a
waiver of any other event, circumstance or condition or of any other right or
remedy available to the Administrative Agent or any Lender pursuant to the
Credit Agreement or any other Loan Document or (ii) a consent to any departure
by the Company or any Restricted Subsidiary from any other term or requirement
of the Credit Agreement.

         SECTION 4. CONDITIONS OF EFFECTIVENESS. This Amendment shall become
effective and be deemed effective as of the date hereof (the "EFFECTIVE DATE")
if, and only if, each of the following conditions shall have been satisfied:

         SECTION 4.1. The Agent shall have received each of the following:

                  (a) counterparts of this Amendment duly executed by the
         Company, the Canadian Borrower, the Required Lenders, the Initial
         Term-C Lenders (as defined in the Credit Agreement as amended hereby)
         and the Administrative Agent;

                  (b) counterparts of the Master Reaffirmation Agreement of even
         date herewith duly executed by each of the Obligors pursuant to which
         each Obligor reaffirms each of the other Loan Documents to which it is
         a party;

                  (c) a Secretary's Certificate from each Obligor duly executed
         by the Secretary or an Assistant Secretary of such Obligor certifying
         (i) the incumbency of officers of such Obligor executing and delivering
         documents on behalf of such Obligor, (ii) a resolution of the Board of
         Directors of such Obligor authorizing the transactions contemplated by
         this Amendment, (iii) the Certificate or Articles of Incorporation of
         such Obligor and (iv) the By-laws of such Obligor; and

                  (d) an opinion addressed to the Agent and the Lenders from
         Davis Polk & Wardwell, special New York counsel to each of the
         Obligors, in form and substance satisfactory to the Agent.

                                       28
<PAGE>   29

         SECTION 4.2. The Agent shall have received from the Company, for the
account of the Original Lenders, an amendment fee equal to 0.25% of the sum of
the Revolving Loan Commitment Amount and the aggregate outstanding principal
balance of the Term-A Loans and Term-B Loans as of the Effective Date.

         SECTION 4.3. The Agent shall have received from the Initial Term-C
Lenders, for the account of the Company, funds in the aggregate amount of
$15,000,000 as proceeds of the Term-C Loans contemplated to be made on the
Effective Date pursuant to the Credit Agreement as amended hereby.

         SECTION 4.4. Prior to the Effective Date, the Company shall have
voluntarily reduced the Revolving Loan Commitment Amount to $44,000,000 pursuant
to SECTION 2.2.1 of the Credit Agreement.

         SECTION 4.5. The Agent shall have received from the Company payment of
all fees and expenses of Sidley Austin Brown & Wood then invoiced.

         SECTION 5. DIRECTION BY LENDERS. The Required Lenders hereby authorize
and direct the Agent to execute and deliver the Intercreditor Agreement on
behalf of the Original Lenders.

         SECTION 6. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company
hereby represents and warrants to the Lenders that, as of the Effective Date
after giving effect to this Amendment, (a) there exists no Default, and (b) the
representations and warranties contained in ARTICLE VI of the Credit Agreement
are true and correct as of the Effective Date after giving effect to this
Amendment, except to the extent any such representation or warranty is stated to
relate solely to an earlier date, in which case such representation or warranty
was true and correct on and as of such earlier date.

         SECTION 7. COVENANT. The Company hereby agrees as follows:

         SECTION 7.1. The Company will, and will cause each applicable
Subsidiary to, execute and deliver to the Agent, promptly upon the Agent's
request, account control agreements in form and substance reasonably
satisfactory to the Agent with respect to the deposit accounts listed on
SCHEDULE 1 attached hereto.

         SECTION 7.2. Within 60 days after the Effective Date, the Company will,
and will cause each applicable Subsidiary to, comply with SECTION 7.1.7(B) of
the Credit Agreement, as amended hereby, with respect to the Capital Stock of
the Subsidiaries listed on SCHEDULE 2 attached hereto.

         SECTION 7.3. Within 60 days after the Effective Date, the Company will,
and will cause each applicable Subsidiary to, comply with SECTION 7.1.8(b) of
the Credit Agreement, as amended hereby, with respect to the real properties
listed on SCHEDULE 3 attached hereto; PROVIDED, HOWEVER, that title insurance
and surveys shall not be required except as requested by the Administrative
Agent in its reasonable discretion.

                                       29
<PAGE>   30

         SECTION 8. REFERENCE TO AND EFFECT ON THE CREDIT AGREEMENT.

         SECTION 8.1. Upon the effectiveness of this Amendment pursuant to
SECTION 4 hereof, on and after the Effective Date each reference in the Credit
Agreement to "this Agreement," "hereunder," "hereof," "herein" or words of like
import and each reference to the Credit Agreement in each Loan Document shall
mean and be a reference to the Credit Agreement as modified hereby.

         SECTION 8.2. Except as specifically waived or amended herein, all of
the terms, conditions and covenants of the Credit Agreement and the other Loan
Documents shall remain in full force and effect and are hereby ratified and
confirmed.

         SECTION 8.3. The execution, delivery and effectiveness of this
Amendment shall not, except as expressly provided herein, operate as a waiver of
(i) any right, power or remedy of any Lender or the Agent under the Credit
Agreement or any of the other Loan Documents, or (ii) any Default under the
Credit Agreement.

         SECTION 9. CHOICE OF LAW. THIS AMENDMENT SHALL BE CONSTRUED IN
ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK.

         SECTION 10. COUNTERPARTS. This Amendment may be executed in any number
of counterparts, each of which when so executed shall be deemed an original and
all of which taken together shall constitute one and the same agreement.
Delivery of an executed counterpart of this Amendment by telecopier shall be
effective as delivery of a manually executed counterpart of this Amendment.

         SECTION 11. HEADINGS. Section headings in this Amendment are included
herein for convenience of reference only and shall not constitute a part of this
Amendment for any other purpose.

                                       30
<PAGE>   31

                                 BANK ONE, NA,
                                 as Administrative Agent

                                 By:  /s/ Kevin Christensen
                                    ---------------------------------
                                          Name: Kevin Christensen
                                          Title: First Vice President

                                 DLJ MERCHANT BANKING PARTNERS II, L.P.,
                                 a Delaware Limited Partnership

                                 By:  DLJ Merchant Banking II, Inc.,
                                       as managing general partner

                                 By: /s/ George Peinado
                                    ---------------------------------
                                          Name: George Peinado
                                          Title:

                                 DLJ MERCHANT BANKING PARTNERS II-A,
                                 L.P., a Delaware Limited Partnership

                                 By:  DLJ Merchant Banking II, Inc.,
                                       as managing general partner

                                 By: /s/ George Peinado
                                    ---------------------------------
                                          Name: George Peinado
                                          Title:

                                 DLJ OFFSHORE PARTNERS II, C.V.,
                                  a Netherlands Antilles Limited Partnership

                                 By:  DLJ Merchant Banking II, Inc.,
                                       as advisory general partner

                                 By: /s/ George Peinado
                                    ---------------------------------
                                          Name: George Peinado
                                          Title:

                                       31
<PAGE>   32

                                 DLJ DIVERSIFIED PARTNERS, L.P.,
                                 a Delaware Limited Partnership

                                 By:  DLJ Diversified Partners, Inc.,
                                       as managing general partner

                                 By: /s/ George Peinado
                                    ---------------------------------
                                          Name: George Peinado
                                          Title:

                                 DLJ DIVERSIFIED PARTNERS-A, L.P.,
                                 a Delaware Limited Partnership

                                 By:  DLJ Diversified Partners, Inc.,
                                       as managing general partner

                                 By: /s/ George Peinado
                                    ---------------------------------
                                          Name: George Peinado
                                          Title:

                                 DLJ MILLENIUM PARTNERS, L.P.,
                                 a Delaware Limited Partnership

                                 By:  DLJ Merchant Banking II, Inc.,
                                       as managing general partner

                                 By: /s/ George Peinado
                                    ---------------------------------
                                          Name: George Peinado
                                          Title:

                                 DLJ MILLENIUM PARTNERS-A, L.P.

                                 By:  DLJ Merchant Banking II, Inc.,

                                       32

<PAGE>   33

                                       as managing general partner

                                 By: /s/ George Peinado
                                    ---------------------------------
                                          Name: George Peinado
                                          Title:

                                 DLJ EAB PARTNERS, L.P.

                                 By:  DLJ LBO Plans Management Corporation,
                                       as managing general partner

                                 By: /s/ George Peinado
                                    ---------------------------------
                                          Name: George Peinado
                                          Title:

                                 DLJ ESC II, L.P.

                                 By:  DLJ LBO Plans Management Corporation,
                                       as general partner

                                 By: /s/ George Peinado
                                    ---------------------------------
                                          Name: George Peinado
                                          Title:

                                 DONALDSON, LUFKIN & JENRETTE SECURITIES
                                 COPORATION as authorized signatory and nominee
                                 for EMA 2001 Plan, L.P., DLJ First ESC, L.P.,
                                 Docklands 2001 Plan, L.P., Paradeplatz 2001
                                 Plan, L.P., Credit Suisse First Boston Private
                                 Equity, Inc. and CSFB 2001 Investors, L.P.

                                 By: /s/ George Peinado
                                    ---------------------------------
                                          Name: George Peinado
                                          Title:

                                       33<PAGE>   1
                                 EXHIBIT 10.18
                                                                        [ LOGO ]

                                    Quotation

COMPANY:                 NSC

COMPANY CONTACT:         Graham Clark

NMRC REF NO.             718/2001

QUOTATION DATE:          30/05/01

Proposal of Work as described in document "Proposal for National Scientific
Corporation revision B 30th May 2001.

5 sections: Simulation, Process Short Loops, Device Fabrication, Design and
Testing

<TABLE>
<S>      <C>                                <C>
1.       Simulation                         Total Cost IRL 9,000
2.       Process Short Loops                Total Cost IRL 19,200
3.       Device Fabrication                 Total Cost IRL 36,000
4.       Design                             Total Cost IRL 7,000
5.       Testing                            Total Cost IRL 9,000
</TABLE>

The proposal of work is given with the clear recognition that making tunnel
diodes is a high risk process and while every effort will be made to make tunnel
diodes this can not be guaranteed.

Quotation valid for three months from above date and subject to [  ] terms and
conditions at contract stage.

Credit terms: Payment due strictly within 30 days from date of invoice.

--------------------------------------------
Name:
     ---------------------------------------
Title:
      --------------------------------------
<PAGE>   2
                  Proposal for National Scientific Corporation
                           Prepared by Julie Donnelly
                            Revision B 30th May 2001.

         The following proposal is broken own in to 5 sections: Simulation,
Process short loops, Device Fabrication, Design and Testing. There is a brief
summary of the work involved in each section and then a cost for the work
involved. The various sections will operate in parallel so that an integrated
approach is taken to the overall work. It should be noted that making tunnel
diodes is a high risk process and while every effort will be made to make the
diodes successfully, there are no published results on working silicon substrate
diodes.

1.       SIMULATION

The simulation will concentrate on obtaining "best" process parameters for the
devices and will cover three areas of interest:

a) Simulation of depletion mode device in the NMRC 1.5um process. There is a
target specification of - 0.4V for the Vt of the depletion mode device. The
effect of the blanket NMRC Vt adjust will be investigated and there may be a
recommendation for the masked Vt.

b) Simulation of substrate N+/P+ tunnel diode (hereafter referred to as
"substrate diode") using existing NMRC implants or recommending unique implants.
The impact of any additional anneals on the 1.5um process will also be assessed.

c) Simulation of P+ doping in polysilicon (hereafter referred to as "poly
diode") with the objective being to try and locate the peak doping concentration
as close to the lower interface as possible. The impact of any additional
anneals on the 1.5um process will also be assessed.

Simulation Cost:  IRL 9,000.  Projected time:  3 - 4 weeks.

2.       PROCESS SHORT LOOPS

1.       Depletion mode Vt

                 There are no short loop processes being proposed for this
device, as it would require too many process steps to check out.

2.       Substrate diode + poly diode

                  9 mask process [zero, active, nwell, N+ S/D, P+ S/D, contact,
                  metal 1]. 1 run of 16 wafers with a matrix of various implants
                  using the standard NMRC anneal.

                  Cost: 16 wafers at L 1,200 each. Total cost = IRL 19,200.
                  Project Time: 8 weeks.
<PAGE>   3
3.       FULL DEVICE RUN

A full device run (17 masks) will be run in parallel with the process
short-loops but held at key stages if short loop wafer results are required.
This cost is based on an initial estimate of the process and may change if there
are additional steps added (eg: additional Vt mask or additional substrate diode
mask and implant).

Cost: 20 wafers at L 1,800 each. Total cost = IRL 36,000. Projected Time: 15
weeks.

4.       DESIGN

CHIP FINISHING COST                 IRL 1,000

RETICLES:         Currently require 14 layers (NMRC zero will be used).

COST: 5 reticles at L 1,200 each + chip finishing. Total cost = IRL 7,000.
Projected Time: 3 weeks.

Current layers:

Nwell

Pwell

Active

Gate

Nplus

Pplus

Contact

Metal 1

Via

Metal 2

Passivation

  * Depletion Device Vt

  * Tunnel Poly contact

  * Tunnel poly definition

Possible layers:

CMOS Vt mask

Tunnel N+ mask

Tunnel P+ mask

5.       TESTING

The testing will involve device testing of the short loop wafers and full
process wafers. The short loop wafer testing characteristic device
characteristics that will be used to give good guidelines for the implant/anneal
matrix for the main device batch.
<PAGE>   4
Estimated cost of testing:  IRL 9,000.  Projected Time:  3 - 4 weeks.

PAYMENT SCHEDULE:

<TABLE>
<CAPTION>
PAYMENT             SECTION           MILESTONE                                     COST               PROJECTED
                                                                                                       TIMESCALE
-------             -------           ---------                                     ----               ---------
<S>                 <C>               <C>                                        <C>                   <C>
Payment 1           Design            Design approved at Compugraphics.          IRL  7,000              Week 1
Payment 2           Simulation        Simulation Report delivered.               IRL  9,000              Week 4
Payment 3           Fabrication       All processing complete.                   IRL 55,200             Week 15
Payment 4           Testing           Testing Report delivered.                  IRL  9,000             Week 17
</TABLE>

SUMMARY

This project will use process short loops to characterise substrate and
polysilicon tunnel diodes. Using the feedback from test results a full batch of
device wafers will be fabricated which will incorporate the tunnel diodes in to
a well-characterised CMOS process.

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